Document:

EXHIBIT 10.11

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (this “Agreement”) is dated as of the 2nd day of August, 2011, by and between Omthera Pharmaceuticals, Inc., a Delaware corporation (the “Company”), and Chris Schade (the “Executive”).

 

WITNESSETH:

 

The Company desires to employ the Executive, and the Executive wishes to accept such employment with the Company, upon the terms and conditions set forth in this Agreement.

 

In consideration of the mutual promises and agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:

 

1.             Employment.  The Company, effective as of September 6, 2011 (the “Effective Date”), hereby employs the Executive as the Executive Vice President and Chief Financial Officer, and the Executive hereby accepts such employment by the Company upon the terms and conditions  hereinafter set forth.

 

2.             Employment Period.  Subject to the provisions set forth herein, the Executive’s employment will be “at-will,” meaning that either the Executive or the Company may terminate the Executive’s employment relationship at any time, for any reason, with or without prior notice.  Notwithstanding the at-will relationship, the Executive agrees to give the Employer at least fourteen (14) days prior written notice if he decides to terminate his employment.  Except in the case of a termination for Cause, the Company agrees that it will provide identical notice.  The term of the Executive’s employment hereunder shall continue until this Agreement is terminated as provided below, and is hereinafter referred to as the “Employment Period.”

 

3.             Compensation.  For performance of all services rendered under this Agreement, the Company shall pay the Executive a base salary at an annual rate of $300,000 (the “Base Salary”) in installments payable in accordance with the Company’s customary payroll practices but no less frequently than once each month.  The Executive shall also be eligible for a merit bonus. in such amount and payable at such time or times as the Board of Directors of the Company (the “Board”) may in its sole discretion determine.  The Executive has a target bonus opportunity of thirty percent (30%) of the Base Salary, assuming achievement of a series of mutually agreed upon performance milestones set each fiscal year.  During the first year of employment, if earned, the bonus will not be pro-rated and will be paid in full to the Executive upon the completion of the Company’s first fiscal year following the commencement of the Executive’s employment.  The actual milestones and the amounts attributable to such milestones, shall be determined by the Board of Directors of the Company (the “Board”) in its sole discretion.  The Executive shall receive a performance review on an annual basis, which will include a determination of potential adjustment of the Executive’s Base Salary, along with an assessment of the afore-mentioned merit bonus.  Nothing herein should be interpreted as a

 

 

guarantee of a salary increase or merit bonus.  The Company shall pay any cash bonuses that the Executive receives by March 15th of the following year.

 

4.             Duties.  The Executive shall be employed as an Executive Vice President and the Chief Financial Officer of the Company, and shall have such duties as are assigned or delegated to him by the Chief Executive Officer.  The Executive shall devote his full time working time, attention and energy exclusively to the business of the Company and shall cooperate fully with the Board in the advancement of the best interests of the Company.  The Executive agrees not to engage in any activities outside of the scope of the Executive’s employment that would detract from, or interfere with, the fulfillment of his responsibilities or duties under this Agreement.  The Executive agrees that the Executive will not serve as a director or the equivalent position of any company or entity, and will not render services of a business, professional or commercial nature to any other person or firm, except for not-for-profit entities, without the prior written consent of the Board, which consent shall not be unreasonably withheld.  It is expressly agreed that the Executive shall be permitted to remain on the Board of Directors of Integra Life Sciences Corporation, and that such permission will not be withdrawn by the Company, unless there is a conflict between such director role of the Executive and the Executive’s obligations to the Company.  If elected as a director of the Company, the Executive agrees to fulfill the duties of such offices without additional compensation.

 

5.             Expenses.  Subject to compliance by the Executive with such policies regarding expenses and expense reimbursement as may be adopted from time to time by the Company, the Executive is authorized to incur reasonable expenses in the performance of his duties hereunder in furtherance of the business and affairs of the Company, and the Company will reimburse the Executive for all such reasonable expenses, upon the presentation by the Executive of an itemized account satisfactory to the Company in substantiation of such expenses when claiming reimbursement.  The Executive shall be reimbursed his attorneys’ fees and costs incurred during the review and/or negotiation of this Agreement, up to an amount not to exceed Five Thousand Five Hundred Dollars ($5,500), upon submission by the Executive of a non-itemized invoice for legal services rendered.

 

6.             Employee Benefits; Vacations.  The Executive shall be eligible to participate in such life insurance, medical and other employee benefit plans of the Company that may be in effect from time to time, to the extent he is eligible under the terms of those plans, on the same basis as other similarly situated executive officers of the Company.  The Company may from time to time modify or eliminate any or all benefits extended or provided in its sole discretion.  The Executive shall be entitled to paid vacations of twenty-five (25) days per year in accordance with the policies of the Company in effect from time to time, as determined by the Board.

 

7.             Stock Options.  Subject to approval of the Board or an appropriate committee thereof, the Executive shall be granted by the Company an option (the “Option”) to purchase 441,323 shares (the “Option Shares”) of the Company’s common stock, $0.001 par value per share (the “Common Stock”).  Twenty five percent (25%) of the Option Shares shall vest on the first anniversary of the Effective Date, and the remaining seventy five percent (75%) shall vest in equal monthly installments thereafter over the subsequent thirty-six (36) months, subject to the Executive’s continued employment by the Company on each such date.  The Option shall be exercisable at a price per share equal to the fair market value of the Common Stock of the

 

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Company on the date of grant, as the Board will determine in its sole discretion.  Concurrently with or after a “Deemed Liquidation Event” (as defined in the Company’s certificate of incorporation, as it may be amended and/or restated from time to time) resulting in the payment of proceeds to the stockholders of the Company in accordance with the provisions of such certificate of incorporation, all then unvested shares underlying all Options shall immediately become vested.  In the event that the Executive’s employment is terminated by the Company for reasons other than Cause (as such term is defined in Section 15) or in the event the Executive terminates his employment for Good Reason (as such term is defined in Section 15), twenty five percent (25%) of then unvested Option Shares underlying the Option shall immediately become vested.  The Options will be granted under and subject to the Company’s 2010 Stock Option Plan, in the form attached hereto as Exhibit C, as it may be amended and/or restated from time to time, and form option grant, in the form attached hereto as Exhibit D.

 

8.             Taxation of Payments and Benefits.  The Company shall make deductions, withholdings and tax reports with respect to payments and benefits under this Agreement to the extent that it reasonably and in good faith believes that it is required to make such deductions, withholdings and tax reports.  Payments under this Agreement shall be in amounts net of any such deductions or withholdings.  Nothing in this Agreement shall be construed to require the Company to make any payments to compensate the Executive for any adverse tax effect associated with any payments or benefits or for any deduction or withholding from any payment or benefit.

 

9.             Termination.  The Executive’s employment relationship with the Company is at-will.  Either the Executive or the Company may terminate the employment relationship at any time, with or without Cause (as such term is defined in Section 15) on advance notice as provided herein or with immediate effect if the termination is for Cause. Upon termination of the Executive’s employment, the Executive will be entitled to any earned but unpaid Base Salary as well as the following additional benefits:

 

(a)           Subject to compliance with Section 9(f), before a Change of Control, in the event that the Executive’s employment is terminated by the Company for reasons other than Cause (as such term is defined in Section 15) or in the event the Executive terminates his employment for Good Reason (as defined in Section 15),the Executive will be provided a severance package equal to nine (9) months of Base Salary, health benefits and such percentage of health premiums as would have been paid during the term of the Executive’s employment.  The salary continuation will be paid out in substantially equal installments in accordance with the Company’s payroll practice over a period of nine (9) months from the date of notice of termination, beginning on the first payroll date that occurs 55 days from the date of termination.  Solely for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), each installment payment is considered a separate payment.  Any bonus that has been previously earned as of the most recent fiscal year end but not paid to Executive will be paid in a lump sum within 10 days after the 55th day after the date of termination.

 

(b)           In the event that the Executive’s employment is terminated for Cause or the Executive resigns without Good Reason, the Executive will not be entitled to a severance package.

 

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(c)           Subject to compliance with Section 9(f), in the event that the Executive’s employment is terminated by reason of his death or Disability (as such term is defined in Section 15) the Executive will be provided a severance package equal to six (6) months of Base Salary, health benefits and such percentage of health premiums as would have been paid during the term of the Executive’s employment.  The salary continuation will be paid in substantially equal installments in accordance with the Company’s payroll practice over a period of six (6) months, beginning on the date of death or Disability, beginning on the first payroll date that occurs 55 days from the date of termination.  Solely for purposes of Section 409A of the Code, each installment payment is considered a separate payment.  Any bonus that has been previously granted but not paid to Executive will be paid in a lump sum within 10 days after the 55th day after the date of termination.

 

(d)           Subject to compliance with Section 9(f), concurrently with or after a Change of Control, in the event that the Executive’s employment is terminated by the Company for reasons other than Cause (as such term is defined in Section 15) or in the event the Executive terminates his employment for Good Reason (as defined in Section 15), the Executive will be provided a severance package with continuation of Base Salary and benefits for twelve (12) months from the date of termination.  The salary continuation will be paid out in substantially equal installments in accordance with the Company’s payroll practice over the time period stated above, beginning on the first payroll date that occurs 55 days from the date of termination.  Solely for purposes of Section 409A of the Code, each installment payment is considered a separate payment.  Any bonus that has been previously granted but not paid to Executive will be paid in a lump sum within 10 days after the 55th day after the date of termination.

 

(e)           Notwithstanding any termination of the Executive’s employment for any reason (with or without Cause or Good Reason), the Executive will continue to be bound by the provisions of the Confidentiality Agreement (as defined below).

 

(f)            All payments and benefits provided pursuant to Sections 9(a), (c) (for Disability but not death) and (d) shall be conditioned upon the Executive’s execution and non-revocation of a general release substantially in the form attached hereto as Exhibit A at the time of termination.  The Executive’s refusal to execute a general release shall constitute a waiver by the Executive of any and all benefits referenced in Sections 9(a), (c) and (d).  The Company will not be obligated to commence or continue any such payments to the Executive under Sections 9(a), (c) and (d) in the event the Executive materially breaches the terms of the Confidentiality Agreement (as defined below) and fails to cure such breach within thirty (30) days of written notice thereof detailing such breach.

 

10.          Employee Confidentiality, Non-Competition, Non-Solicitation and Assignment Agreement.  The Company considers the protection of its confidential information and proprietary materials to be very important.  Therefore, as a condition of the Executive’s employment, the Executive will be required to execute a standard confidentiality, non-competition, non-solicitation and invention assignment agreement substantially in the form attached hereto as Exhibit B (the “Confidentiality Agreement”) on the date hereof.

 

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11.          Documents, Records, etc.  All documents, records, data, apparatus, equipment and other physical property, whether or not pertaining to Proprietary Information (as defined in the Confidentiality Agreement), which are furnished to the Executive by the Company or are produced by the Executive in connection with the Executive’s employment will be and remain the sole property of the Employer.  The Executive will return to the Company all such materials and property as and when requested by the Employer.  In any event, the Executive will return all such materials and property immediately upon termination of the Executive’s employment for any reason.

 

12.          Litigation and Regulatory Cooperation.  During and after the Executive’s employment, the Executive shall cooperate fully with the Company in the defense or prosecution of any claims or actions now in existence or which may be brought in the future against or on behalf of the Company which relate to events or occurrences that transpired while the Executive was employed by the Company.  The Executive’s full cooperation in connection with such claims or actions shall include, but not be limited to, being available to meet with counsel to prepare for discovery or trial and to act as a witness on behalf of the Company at mutually convenient times.  During and after the Executive’s employment, the Executive also shall cooperate fully with the Company in connection with any investigation or review of any federal, state or local regulatory authority as any such investigation or review relates to events or occurrences that transpired while the Executive was employed by the Company.  The Company shall reimburse Executive for all his reasonable attorneys fees and costs associated with such efforts under this Section 12. Notwithstanding the foregoing, the Executive’s obligations under this Section 12 shall not apply in the event of any dispute, claim or action between the Executive and the Company.

 

13.          Cooperation with the Company after Termination.  Following termination of this Agreement for any reason (with or without Cause), the Executive shall fully cooperate with the Company in all matters relating to the winding up of the Executive’s services under this Agreement and the orderly transfer of such matters to any person designated by the Company and shall promptly return to the Company all of the property of the Company and any other materials or information related to the Company, including all work product, whether finished or unfinished, prepared or produced by the Executive for the benefit of the Company under this Agreement. The Executive agrees not attend the premises of the Company during any period following any notice of termination should the Board of Directors so request.

 

14.          No Conflict.  The Executive hereby represents and warrants to the Company that (a) this Agreement constitutes the Executive’s legal and binding obligation, enforceable against him in accordance with its terms, (b) his execution and performance of this Agreement does not and will not breach any other agreement, arrangements, understanding, obligation of confidentiality or employment relationship to which he is a party or by which he is bound, and (c) during the Employment Period, he will not enter into any agreement, either written or oral, in conflict with this Agreement or his obligations hereunder.

 

15.          Definitions.

 

(a)           The term “Cause” shall mean (i) the Executive’s intentional, willful or knowing failure or refusal to perform the Executive’s duties (other than as a result of

 

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physical or mental illness, accident or injury) or any other material breach of this Agreement by the Executive; (ii) dishonesty that could reasonably be expected to damage the Company, willful or gross misconduct, or illegal conduct by the Executive in connection with the Executive’s employment with the Company; (iii) the Executive’s conviction of, or plea of guilty or nolo contendere to, a charge of commission of a felony (exclusive of any felony relating to negligent or unlawful operation of a motor vehicle); and (iv) a material breach by the Executive of the Confidentiality Agreement; provided, however, in the case of clauses (i) and (iv) above, the Company shall be required to give the Executive thirty (30) calendar days prior written notice of its intention to terminate the Executive for Cause and the Executive shall have the opportunity during such thirty (30) day period to cure such event if such event is capable of being cured.

 

(b)           The term “Change of Control” shall mean, in one or a series of related transactions, (1) the sale or other disposition of all or substantially all of the assets of the Company, (2) the sale or other disposition of all of the issued and outstanding stock of the Company, (3) a “Deemed Liquidation Event” (as defined in the Company’s certificate of incorporation, as it may be amended and/or restated from time to time) or (4) the merger or consolidation of the Company with or into another entity in which all of the issued and outstanding stock of the Company is converted into or exchanged for cash, securities of another entity, or other property; provided, in each case, that the stockholders of the Company immediately before such transaction do not, immediately thereafter, beneficially own (as such term is used in Rule 13d-3 under the Securities Exchange Act of 1934, as amended) a majority of the outstanding equity of the entity that acquires the Company’s assets or stock or of the surviving or resulting entity in such a merger or consolidation.

 

(c)           The term “Disability” shall mean if the Executive is incapacitated or disabled by accident or sickness or otherwise so as to render him mentally or physically incapable of performing the services required to be performed by him under this Agreement for a period of 120 consecutive days or longer, or for an aggregate of 120 days during any twelve-month period.

 

(d)           The term “Good Reason” shall mean (i) any material adverse change in Executive’s title, (ii) any material diminution in the Executive’s authority or responsibilities taken as a whole, (ii) any reduction of the Executive’s base salary, other than pursuant to an across-the-board reduction in the compensation of all senior management of the Company; provided that such reduction is proportionately equal among all such members of senior management, (iii) any material breach by the Company of its obligations under this Agreement, and (iv) a material change without the Executive’s consent in the principal location of the Company’s office to an office that is more than fifty miles from Flemington, New Jersey; provided that in any case the Executive provides the Company with written notice of the Executive’s intention to terminate the Executive’s employment for Good Reason and the reason(s) upon which the Good Reason termination is based, and gives the Company an opportunity to cure for thirty (30) days following receipt of such notice from the Executive, if the event is capable of being cured or, if not capable of being cured, to have the Company’s representatives meet with the Executive and the Executive’s counsel to be heard regarding whether Good Reason exists for the Executive to terminate the Executive’s employment with the Company and the Executive terminates employment within thirty days after the end of the cure period if the Good Reason condition is not cured.

 

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(e)           The term “person” shall mean any individual, corporation, firm, association, partnership, other legal entity or other form of business organization.

 

16.          Section 409A.

 

(a)           Anything in this Agreement to the contrary notwithstanding, if at the time of the Executive’s separation from service within the meaning of Section 409A of the Code, the Company determines that the Executive is a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit that the Executive becomes entitled to under this Agreement on account of the Executive’s separation from service would be considered deferred compensation subject to the 20 percent additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and such benefit shall not be provided until the date that is the earlier of (A) six months and one day after the Executive’s separation from service, or (B) the Executive’s death.  If any such delayed cash payment is otherwise payable on an installment basis, the first payment shall include a catch-up payment covering amounts that would otherwise have been paid during the six-month period but for the application of this provision, and the balance of the installments shall be payable in accordance with their original schedule.

 

(b)           The parties intend that this Agreement will be administered in accordance with Section 409A of the Code.  To the extent that any provision of this Agreement is ambiguous as to its compliance with Section 409A of the Code, the provision shall be read in such a manner so that all payments hereunder comply with Section 409A of the Code.  The parties agree that this Agreement may be amended, as reasonably requested by either party, and as may be necessary to fully comply with Section 409A of the Code and all related rules and regulations in order to preserve the payments and benefits provided hereunder without additional cost to either party.

 

(c)           The determination of whether and when a separation from service has occurred shall be made by the Company in accordance with the presumptions set forth in Treasury Regulation Section 1.409A-1(h).

 

(d)           The Company makes no representation or warranty and shall have no liability to the Executive or any other person if any provisions of this Agreement are determined to constitute deferred compensation subject to Section 409A of the Code but do not satisfy an exemption from, or the conditions of, such Section.

 

17.          Successors and Assigns; Entire Agreement; No Assignment.  This Agreement shall bind and inure to the benefit of the parties hereto and their respective successors or heirs, distributes and personal representatives.  This Agreement and the Confidentiality Agreement contain the entire agreement between the parties with respect to the subject matter hereof and supersede other prior and contemporaneous arrangements or understandings with respect thereto.  The Executive may not assign this Agreement without the prior written consent of the Company.

 

18.          Notices.  All notices and other communications required or permitted hereunder or necessary or convenient in connection herewith shall be in writing and shall be deemed to

 

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have been given when hand-delivered, mailed by registered or certified mail (three days after deposited), faxed (with confirmation received) or sent by a nationally recognized courier service, as follows (provided that notice of change of address shall be deemed given only when received):

 

If to the Company:                                      90 Washington Valley Road

Bedminster, NJ 07921

Attn: CEO

 

If to the Executive:                                       Chris Schade

 

or to such other names and addresses as the Company or the Executive, as the case may be, shall designate by notice to each other person entitled to receive notices in the manner specified in this Section 18.

 

19.          Changes; No Waiver; Remedies Cumulative.  The terms and provisions of this Agreement may not be modified or amended, or any of the provisions hereof waived, temporarily or permanently, without the prior written consent of each of the parties hereto.  Either party’s waiver or failure to enforce the terms of this Agreement or any similar agreement in one instance shall not constitute a waiver of its or his rights hereunder with respect to other violations of this or any other agreement.  No remedy conferred upon the Company or the Executive by this Agreement is intended to be exclusive of any other remedy, and each and every such remedy shall be cumulative and shall be in addition to any other remedy given hereunder or now or hereafter existing at law or in equity.

 

20.          Governing Law; Jurisdiction.  This Agreement and (unless otherwise provided) all amendments hereof and waivers and consents hereunder shall be governed by the law of the State of New Jersey, without regard to the conflicts of law principles.  Each party hereby submits himself and itself, for the sole purpose of this Agreement, the Confidentiality Agreement, and any controversy arising hereunder and thereunder, to the exclusive jurisdiction of the state and Federal courts located in the State of New Jersey, and waives any objection (on the grounds of lack of jurisdiction, forum non conveniens or otherwise) to the exercise of such jurisdiction over it by any such court in the State of New Jersey.  Each party hereby agrees that service of process may be served on him or it by certified mail, return receipt requested, or overnight courier, sent to address of such entity listed in Section 17 above (or such other address as any such party notifies the others thereof by written notice).  THE PARTIES HEREBY EXPRESSLY WAIVE THEIR RIGHTS TO HAVE A JURY TRIAL.

 

21.          Severability.  The Executive and the Company agree that should any provision of this Agreement be judicially determined invalid or unenforceable, that portion of this Agreement may be modified to comply with the law.  The Executive and the Company further agree that the invalidity or unenforceability of any provision of this Agreement will not affect the validity or enforceability of its remaining provisions.

 

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22.          Execution of Other Agreements.  The Confidentiality Agreement is hereby incorporated into this Agreement in its entirety and is made an integral part of this Agreement.

 

23.          Headings; Counterparts.  All section headings are for convenience only.  This Agreement may be executed in several counterparts, each of which is an original.

 

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IN WITNESS WHEREOF, the parties have executed this Employment Agreement as of the date first above written.

 

	
 
    	
OMTHERA   PHARMACEUTICALS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   /s/ Gerald Wisler
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
EXECUTIVE:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Chris Schade
    
	
 
    	
Chris   Schade
    

 

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EXHIBIT A

 

GENERAL RELEASE OF CLAIMS

 

For and in consideration of the payments and other benefits described in the Employment Agreement dated as of [                ], 2011 (the “Agreement”) by and among Omthera Pharmaceuticals, Inc. (the “Company”), and Chris Schade (the “Employee”) and for other good and valuable consideration, the Employee hereby releases the Company and its respective divisions, operating companies, affiliates, subsidiaries, parents, branches, predecessors, successors, assigns, officers, directors, trustees, employees, agents, shareholders, administrators, representatives, attorneys, insurers and fiduciaries, past, present and future (the “Released Parties”) from any and all claims of any kind arising out of or related to the Employee’s employment with the Company, the Employee’s separation from employment with the Company or derivative of the Employee’s employment, which the Employee now has or may have against the Released Parties, whether known or unknown to the Employee, by reason of facts which have occurred on or prior to the date that the Employee has signed this General Release of claims.  Such released claims include, without limitation, any alleged violation of the Age Discrimination in Employment Act, as amended, the Older Worker Benefits Protection Act; Title VII of the civil Rights of 1964, as amended; Sections 1981 through 1988 of Title 42 of the United States Code; the Civil Rights Act of 1991; the Equal Pay Act; the Americans with Disabilities Act; the Rehabilitation Act; the Family and Medical Leave Act; the Fair Labor Standards Act; the Employee Retirement Income Security Act of 1974 as amended; the Worker Adjustment and Retraining Notification Act; the National Labor Relations Act; the Fair Credit Reporting Act; the Occupational Safety and Health Act; the Uniformed Services Employment and Reemployment Act; the Employee Polygraph Protection Act; the Immigration Reform control Act; the retaliation provisions of the Sarbanes-Oxley Act of 2002; the Federal False claims Act; the New Jersey Law Against Discrimination; the New Jersey Domestic Partnership Act; the New Jersey Conscientious Employee Protection Act; the New Jersey Family Leave Act; the New Jersey Wage and Hour Law; the New Jersey Equal Pay Law; the New Jersey Occupational Safety and Health Law; the New Jersey Smokers’ Rights Law; the New Jersey Workers’ Compensation Law (and including any and all amendments to the above) and/or any other alleged violation of any federal, state or local law, regulation or ordinance, and/or contract or any other alleged violation of any federal, state or local law, regulation or ordinance, and/or contract or implied contract or tort law or public policy or whistleblower claim, having any bearing whatsoever on the Employee’s employment by and the termination of the Employee’s employment with the Company, including, but not limited to, any claim for wrongful discharge, back pay, vacation pay, sick pay, wage, commission or bonus payment, money or equitable relief or damages of any kind, attorneys’ fees, costs, and/or future wage loss.

 

It is understood that this General Release of Claims is not intended to and does not affect or release any future rights or any claims arising after the date hereof. Notwithstanding the foregoing, nothing herein shall release the Company against the benefits of or any claims by the Employee under the indemnification provisions of the Company’s certificate of incorporation as may be amended or restated from time to time. In addition the Company agrees that with respect to any liability arising from Employee’s actions while employed by the Company, the Employee will continue to be covered by the applicable directors and officers insurance generally covering directors and officers of the Company following his last date of employment.  Notwithstanding

 

 

the foregoing provisions of this General Release of Claims, to the extent there is a conflict between this General Release of Claims, on one hand, and the applicable directors and officers insurance, on the other, the Employee’s benefits under the applicable insurance plan/policy will remain in full force and effect control.

 

The Employee understands that the consideration provided to him under the terms of the Agreement or otherwise does not constitute any admission by the Company that it has violated any law or legal obligation.

 

The Employee agrees, to the fullest extent permitted by law, that he will not commence, maintain, prosecute or participate in any action or proceeding of any kind against the Company based on any of the claims waived herein occurring up to and including the date of his signature.  The Employee represents and warrants that he has not done so as of the effective date of this General Release of Claims.  Notwithstanding the foregoing agreement, representation and warranty, if the Employee violates any of the provisions of this paragraph, the Employee agrees to indemnify and hold harmless the Company from and against any and all costs, attorneys’ fees and other expenses authorized by law which result from, or are incident to, such violation.  This paragraph is not intended to preclude the Employee from (1) enforcing the terms of the Agreement; (2) challenging the knowing and voluntary nature of this General Release of Claims; or (3) filing a charge or participating in any investigation or proceeding conducted by the Equal Employment Opportunity Commission.

 

The Employee further agrees to waive his right to any monetary or equitable recovery should any federal, state or local administrative agency pursue any claims on his behalf arising out of or related to his employment with and/or separation from employment with the company and promises not to seek or accept any award, settlement or other monetary or equitable relief from any source or proceeding brought by any person or governmental entity or agency on his behalf or on behalf of any class of which he is a member with respect to any of the claims he has waived.

 

The Employee acknowledges and agrees that the Employee has read this General Release of Claims carefully, and acknowledges that he has been given at least twenty one (21) days from the date of receipt of this General Release of Claims to consider all of its terms and has been advised to consult with any attorney and any other advisors of the Employee’s choice prior to executing this General Release of Claims.  The Employee fully understands that, by signing below, the Employee is voluntarily giving up any right which the Employee may have to sue or bring any other claims against the Released Parties, including any rights and claims under the Age Discrimination in Employment Act.  The terms of this General Release of Claims shall not become effective or enforceable until eight (8) days following the date of its execution by the Employee, during which time the Employee may revoke the Agreement.  The Employee may revoke the Agreement by notifying the Company in writing (to the attention of the President and Chief Executive Officer).  For the Employee’s revocation to be effective, written notice must be received by the Company no later than the close of business on the eighth (8th) day after the Employee signs this General Release of Claims.  The terms of this offer to provide the payments and other benefits described in Section 8(a) of the Agreement will expire if not accepted during the twenty one (21) day review period.

 

 

The Employee agrees to keep confidential all information contained in this General Release of Claims and relating to this General Release of Claims, except (1) to the extent the Company consents in writing to such disclosure; (2) if the Employee is required by process of law to make such disclosure and the Employee promptly notifies the Company of his receipt of such process; or (3) because the Employee must disclose certain terms on a confidential basis to his financial consultant, attorney or spouse.

 

This General Release of Claims shall be construed and enforced in accordance with, and governed by, the laws of the State of New Jersey, without regard to principles of conflict of laws.  If any clause of this General Release of Claims should ever be determined to be unenforceable, it is agreed that this will not affect the enforceability of any other clause or the remainder of this General Release of Claims.

 

This General Release of Claims is final and binding and may not be changed or modified except as set forth herein or in a writing signed by both parties.  The parties have executed this General Release of Claims with full knowledge of any and all rights they may have, and they hereby assume the risk of any mistake in fact in connection wit the true facts involved, or with regard to any facts which are now unknown to them.

 

By signing this General Release of claims, the Employee acknowledges that: (1) he has read this General Release of Claims completely; (2) he has had an opportunity to consider the terms of this General Release of Claims; (3) he has had the opportunity to consult with an attorney of his choosing prior to executing this General Release of Claims to explain this General Release of Claims and its consequences; (4) he knows that he is giving up important legal rights by signing this General Release of Claims; (5) he has not relied on any representation or statement not set forth in this General Release of Claims; (6) he understands and means everything that he has said in this General Release of Claims, and he agrees to all its terms; and (7) he has signed this General Release of Claims voluntarily and entirely of his own free will.

 

	
 
    	
 
    	
 
    
	
Date
    	
 
    	
Chris   Schade
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Date
    	
 
    	
Omthera   Pharmaceuticals, Inc.
    
	
 
    	
 
    	
 
    

 

 

EXHIBIT B

 

CONFIDENTIALITY AGREEMENT

 

OMTHERA PHARMACEUTICALS, INC.

 

Employee Confidentiality, Non-Competition, Non-Solicitation and Assignment Agreement

 

In consideration and as a condition of my employment or continued employment by Omthera Pharmaceuticals, Inc. (the “Company”), I agree as follows:

 

1.                                      Proprietary Information.  I agree that all information, whether or not in writing, and whether or not disclosed before or after I was first employed by the Company, concerning the Company’s business, technology, business relationships or financial affairs which the Company has not released to the general public (collectively, “Proprietary Information”), and all tangible embodiments thereof, are and will be the exclusive property of the Company.  By way of illustration, Proprietary Information may include information or material which has not been made generally available to the public, such as:  (a) corporate information, including plans, strategies, methods, policies, resolutions, notes, email correspondence, negotiations or litigation; (b) marketing information, including strategies, methods, customer identities or other information about customers, prospect identities or other information about prospects, or market analyses or projections; (c) financial information, including cost and performance data, debt arrangements, equity structure, investors and holdings, purchasing and sales data and price lists; and (d) operational and technological information, including plans, specifications, manuals, forms, templates, software, designs, methods, procedures, formulas, discoveries, inventions, improvements, biological or chemical materials, concepts and ideas; and (e) personnel information, including personnel lists, reporting or organizational structure, resumes, personnel data, compensation structure, performance evaluations and termination arrangements or documents.  Proprietary Information also includes, without limitation, (i) information received in confidence by the Company from its customers or suppliers or other third parties and (ii) all biological or chemical materials and other tangible embodiments of the Proprietary Information.

 

2.                                      Recognition of Company’s Rights.  I will not, at any time, without the Company’s prior written permission, either during or after my employment, disclose or transfer any Proprietary Information to anyone outside of the Company, or use or permit to be used any Proprietary Information for any purpose other than the performance of my duties as an employee of the Company.  I will cooperate with the Company and use my best efforts to prevent the unauthorized disclosure of all Proprietary Information.  I will deliver to the Company all copies and other tangible embodiments of Proprietary Information in my possession or control upon the earlier of a request by the Company or termination of my employment.

 

3.                                      Rights of Others.  I understand that the  Company is now and may hereafter be subject to non-disclosure or confidentiality agreements with third persons which require the Company to protect or refrain from use of Proprietary Information.  I agree to be bound by the terms of such agreements in the event I have access to such Proprietary Information.

 

4.                                      Commitment to Company; Avoidance of Conflict of Interest.  While an employee of the  Company, I will devote my full-time efforts to the Company’s business and I will not engage in any other business activity that conflicts with my duties to the Company.  I will advise the president of the Company or his or her nominee at such time as any activity of either the Company or another business presents me with a conflict of interest or the appearance of a conflict of interest as an employee of the Company.  I will take whatever action is requested of me by the Company to resolve any conflict or appearance of conflict which it finds to exist.

 

5.                                      Developments.  I will make full and prompt disclosure to the Company of all inventions, discoveries, designs, developments, methods, modifications, improvements, processes, biological or chemical materials, algorithms, databases, computer programs, formulae, techniques, trade secrets, graphics or images, audio or visual works, and other works of authorship (collectively “Developments”), whether or not patentable or copyrightable, that are created, made, conceived or reduced to practice by me (alone or jointly with others) or under my direction during the period of my employment.  I acknowledge that all work performed by me is on a “work for hire” basis, and I hereby do assign and transfer and, to the extent any such assignment cannot be made at present, will assign and transfer, to the  Company and its successors and assigns all my right, title and interest in and to all Developments that (a) relate to therapies targeted at disorders caused by dyslipidemia; or (b) result from tasks assigned to me by the Company; or (c) result from the use of premises or personal property (whether tangible or intangible) owned, leased or

 

 

contracted for by the Company (“Company-Related Developments”), and all related patents, patent applications, trademarks and trademark applications, copyrights and copyright applications, and other intellectual property rights in all countries and territories worldwide and under any international conventions (“Intellectual Property Rights”).

 

To preclude any possible uncertainty, I have set forth on Exhibit A attached hereto a complete list of Developments that I have, alone or jointly with others, conceived, developed or reduced to practice prior to the commencement of my employment with the Company that I consider to be my property or the property of third parties and that I wish to have excluded from the scope of this Agreement (“Prior Inventions”).  If disclosure of any such Prior Invention would cause me to violate any prior confidentiality agreement, I understand that I am not to list such Prior Inventions in Exhibit A but am only to disclose a cursory name for each such invention, a listing of the party(ies) to whom it belongs and the fact that full disclosure as to such inventions has not been made for that reason.  I have also listed on Exhibit A all patents and patent applications in which I am named as an inventor, other than those which have been assigned to the Company (“Other Patent Rights”).  If no such disclosure is attached, I represent that there are no Prior Inventions or Other Patent Rights.  If, in the course of my employment with the Company, I incorporate a Prior Invention into a Company product, process, machine or research or development program or other work done for the Company, I hereby grant to the Company a nonexclusive, royalty-free, fully paid-up, irrevocable, worldwide license (with the full right to sublicense through multiple tiers) to make, have made, modify, use, sell, offer for sale and import such Prior Invention.  Notwithstanding the foregoing, I will not incorporate, or permit to be incorporated, Prior Inventions in any Company-Related Development without the Company’s prior written consent.

 

This Agreement does not obligate me to assign to the Company any Development which, in the sole judgment of the Company, reasonably exercised, is developed entirely on my own time and does not relate to the business efforts or research and development efforts in which, during the period of my employment, the Company actually is engaged or reasonably would be engaged, and does not result from the use of premises or equipment owned or leased by the Company.  However, I will also promptly disclose to the Company any such Developments for the purpose of determining whether they qualify for such exclusion.  I understand that to the extent this Agreement is required to be construed in accordance with the laws of any state which precludes a requirement in an employee agreement to assign certain classes of inventions made by an employee, this paragraph 5 will be interpreted not to apply to any invention which a court rules and/or the Company agrees falls within such classes.  I also hereby waive all claims to any moral rights or other special rights which I may have or accrue in any Company-Related Developments.

 

6.                                      Documents and Other Materials.  I will keep and maintain adequate and current records of all Proprietary Information and Company-Related Developments conceived by me during my employment, which records will be available to and remain the sole property of the Company at all times.

 

All files, letters, notes, memoranda, reports, records, data, sketches, drawings, notebooks, layouts, charts, quotations and proposals, specification sheets, program listings, blueprints, models, prototypes, or other written, photographic or other tangible material containing Proprietary Information, whether created by me or others, which come into my custody or possession, are the exclusive property of the Company to be used by me only in the performance of my duties for the Company.  Any property situated on the Company’s premises and owned by the Company, including without limitation computers, disks and other storage media, filing cabinets or other work areas, is subject to inspection by the Company at any time with or without notice.  In the event of the termination of my employment for any reason, I will deliver to the Company all files, letters, notes, memoranda, reports, records, data, sketches, drawings, notebooks, layouts, charts, quotations and proposals, specification sheets, program listings, blueprints, models, prototypes, materials or other written, photographic or other tangible material containing or embodying Proprietary Information, and other materials of any nature pertaining to the Proprietary Information of the Company and to my work, and will not take or keep in my possession any of the foregoing or any copies.

 

7.                                      Enforcement of Intellectual Property Rights.  I will cooperate fully with the Company, both during and after my employment with the Company, with respect to the procurement, maintenance and enforcement of Intellectual Property Rights in Company-Related Developments, as well as all other patent rights, trademarks, copyrights and other Intellectual Property Rights in all countries and territories worldwide owned by or licensed to the Company.  I will sign, both during and after the term of this Agreement,  all papers, including without limitation copyright applications, patent applications,

 

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declarations, oaths, assignments of priority rights, and powers of attorney, which the Company may deem necessary or desirable in order to protect its rights and interests in any Company-Related Development or Intellectual Property Rights.  If the Company is unable, after reasonable effort, to secure my signature on any such papers, I hereby irrevocably designate and appoint each officer of the Company as my agent and attorney-in-fact to execute any such papers on my behalf, and to take any and all actions as the Company may deem necessary or desirable in order to protect its rights and interests in the same.

 

8.                                      Non-Competition and Non-Solicitation.  In order to protect the Company’s Proprietary Information and good will, during my employment and for a period of twelve months following the termination of my employment for any reason (the “Restricted Period”), I will not directly or indirectly, whether as owner, partner, shareholder, director, consultant, agent, employee, co-venturer or otherwise, engage, participate or invest in any business activity anywhere in the world that develops, manufactures or markets any products, or performs any services, that are otherwise competitive with or similar to the products or services of the Company, or products or services that the Company has under development or that are the subject of active planning at any time during my employment; provided that this will not prohibit any possible investment in publicly traded stock of a company representing less than one percent of the stock of such company.  In addition, during the Restricted Period, I will not, directly or indirectly, in any manner, other than for the benefit of the Company, (a) call upon, solicit, divert or take away any of the customers, business or prospective customers of the Company or any of its suppliers, and/or (b) solicit, entice or attempt to persuade any other employee or consultant of the Company to leave the services of the Company for any reason.  I acknowledge and agree that if I violate any of the provisions of this paragraph 8, the running of the Restricted Period will be extended by the time during which I engage in such violation(s).

 

9.                                      Government Contracts.  I acknowledge that the Company may have from time to time agreements with other persons or with the United States Government or its agencies which impose obligations or restrictions on the Company regarding inventions made during the course of work under such agreements or regarding the confidential nature of such work.  I agree to comply with any such obligations or restrictions upon the direction of the Company. In addition to the rights assigned under paragraph 5, I also assign to the Company (or any of its nominees) all rights which I have or acquired in any Developments, full title to which is required to be in the United States under any contract between the Company and the United States or any of its agencies.

 

10.                               Prior Agreements.  I hereby represent that, except as I have fully disclosed previously in writing to the Company, I am not bound by the terms of any agreement with any previous employer or other party to refrain from using or disclosing any trade secret or confidential or proprietary information in the course of my employment with the Company or to refrain from competing, directly or indirectly, with the business of such previous employer or any other party.  I further represent that my performance of all the terms of this Agreement as an employee of the Company does not and will not breach any agreement to keep in confidence proprietary information, knowledge or data acquired by me in confidence or in trust prior to my employment with the Company. I will not disclose to the Company or induce the Company to use any confidential or proprietary information or material belonging to any previous employer or others.

 

11.                               Remedies Upon Breach.  I understand that the restrictions contained in this Agreement are necessary for the protection of the business and goodwill of the Company and I consider them to be reasonable for such purpose.  Any breach of this Agreement is likely to cause the Company substantial and irrevocable damage and therefore, in the event of such breach, the  Company, in addition to such other remedies which may be available, will be entitled to specific performance and other injunctive relief.

 

12.                               Use of Voice, Image and Likeness.  I give the Company permission to use any and all of my voice, image and likeness, with or without using my name, in connection with the products and/or services of the Company, for the purposes of advertising and promoting such products and/or services and/or the Company, and/or for other purposes deemed appropriate by the Company in its reasonable discretion, except to the extent expressly prohibited by law.

 

13.                               Publications and Public Statements.  I will obtain the Company’s written approval before publishing or submitting for publication any material that relates to my work at the Company and/or incorporates any Proprietary Information.  To ensure that the Company delivers a consistent message about its products, services and operations to the public, and further in recognition that even positive

 

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statements may have a detrimental effect on the Company in certain securities transactions and other contexts, any statement about the Company which I create, publish or post during my period of employment and for six (6) months thereafter, on any media accessible by the public, including but not limited to electronic bulletin boards and Internet-based chat rooms, must first be reviewed and approved by an officer of the Company before it is released in the public domain.

 

14.                               No Employment Obligation.  I understand that this Agreement does not create an obligation on the  Company or any other person to continue my employment.  I acknowledge that, unless otherwise agreed in a formal written employment agreement signed on behalf of the Company by an authorized officer, my employment with the Company is at will and therefore may be terminated by the Company or me at any time and for any reason.

 

15.                               Survival and Assignment by the Company.  I understand that my obligations under this Agreement will continue in accordance with its express terms regardless of any changes in my title, position, duties, salary, compensation or benefits or other terms and conditions of employment. I further understand that my obligations under this Agreement will continue following the termination of my employment regardless of the manner of such termination and will be binding upon my heirs, executors and administrators.  The Company will have the right to assign this Agreement to its affiliates, successors and assigns.  I expressly consent to be bound by the provisions of this Agreement for the benefit of the Company or any parent, subsidiary or affiliate to whose employ I may be transferred without the necessity that this Agreement be resigned at the time of such transfer.

 

16.                               Exit Interview.  If and when I depart from the Company, I may be required to attend an exit interview and sign an “Employee Exit Acknowledgement” to reaffirm my acceptance and acknowledgement of the obligations set forth in this Agreement.  For twelve (12) months following termination of my employment, I will notify the Company of any change in my address and of each subsequent employment or business activity, including the name and address of my employer or other post-Company employment plans and the nature of my activities.

 

17.                               Disclosure to Future Employers. I will provide a copy of this Agreement to any prospective employer, partner or coventurer prior to entering into an employment, partnership or other business relationship with such person or entity.

 

18.                               Severability.  In case any provisions (or portions thereof) contained in this Agreement shall, for any reason, be held invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect the other provisions of this Agreement, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein.  If, moreover, any one or more of the provisions contained in this Agreement shall for any reason be held to be excessively broad as to duration, geographical scope, activity or subject, it shall be construed by limiting and reducing it, so as to be enforceable to the extent compatible with the applicable law as it shall then appear.

 

19.                               Entire Agreement.  This Agreement constitutes the entire and only agreement between the Company and me respecting the subject matter hereof, and supersedes all prior agreements and understandings, oral or written, between us concerning such subject matter.  No modification, amendment, waiver or termination of this Agreement or of any provision hereof will be binding unless made in writing and signed by an authorized officer of the Company.  Failure of the Company to insist upon strict compliance with any of the terms, covenants or conditions hereof will not be deemed a waiver of such terms, covenants or conditions.  In the event of any inconsistency between this Agreement and any other contract between the Company and me, the provisions of this Agreement will prevail.

 

20.                               Interpretation.  This Agreement will be deemed to be made and entered into in the State of New Jersey, and will in all respects be interpreted, enforced and governed under the laws of the State of New Jersey.  I hereby agree to consent to personal jurisdiction of the state and federal courts situated within New Jersey for purposes of enforcing this Agreement, and waive any objection that I might have to personal jurisdiction or venue in those courts.

 

[End of Text]

 

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I UNDERSTAND THAT THIS AGREEMENT AFFECTS IMPORTANT RIGHTS.  BY SIGNING BELOW, I CERTIFY THAT I HAVE READ IT CAREFULLY AND AM SATISFIED THAT I UNDERSTAND IT COMPLETELY.

 

IN WITNESS WHEREOF,  the undersigned has executed this agreement as a sealed instrument as of the date set forth below.

 

 

	
Signed:
    	
 
    	
 
    
	
(Employee’s   full name)
    	
 
    
	
 
    	
 
    	
 
    
	
Type or print name:
    	
 
    	
 
    	
 
    
	
Social   Security Number:
    	
 
    	
 
    	
Date:
    	
 
    
							

 

 

EXHIBIT A

 

To:                                                                         Omthera Pharmaceuticals, Inc.

 

From:

 

Date:

 

SUBJECT:                                 Prior Inventions

 

The following is a complete list of all inventions or improvements relevant to the subject matter of my employment by the Company that have been made or conceived or first reduced to practice by me alone or jointly with others prior to my engagement by the Company:

 

No inventions or improvements

 

See below:

 

 

Additional sheets attached

 

The following is a list of all patents and patent applications in which I have been named as an inventor:

 

None

 

See below:

 

 

 

 

 

EXHIBIT C

 

2010 OPTION PLAN

 

Please see attached.

 

 

EXHIBIT D

 

FORM OF OPTION AGREEMENT

 

Please see attached.Exhibit 10.12

 

AMENDED AND RESTATED STOCK PURCHASE AND RESTRICTION AGREEMENT

 

THIS AMENDED AND RESTATED STOCK PURCHASE AND RESTRICTION AGREEMENT (this “Agreement”), made as of November 13th, 2009 by and between Omthera Pharmaceuticals, Inc., a Delaware corporation (the “Company”), and Gerald Wisler (the “Stockholder”).

 

WHEREAS, pursuant to the Stock Purchase and Restriction Agreement dated as of December 18, 2008 by and between the Company and Stockholder (the “Original Agreement”), the Company sold to Stockholder, Two Million (2,000,000) shares (the “Shares”) of common stock, par value $0.001 per share, of the Company (the “Common Stock”); and

 

WHEREAS, it was a condition of the Company’s willingness to sell the Shares to Stockholder that Stockholder and the Company enter into the Original Agreement placing certain restrictions on transfer of the Shares and giving the Company certain rights to purchase the Shares.

 

WHEREAS, the Company and Stockholder desire to amend and restate the Original Agreement in its entirety;

 

NOW, THEREFORE, for good and valuable consideration, the parties hereby agree as follows:

 

1. Purchase Transfer of Shares.  Stockholder has purchased, and the Company has sold to Stockholder the Shares at a purchase price of $0.001 per share (the “Purchase Price”), or $2,000.00 in the aggregate, which Purchase Price was delivered to the Company. An aggregate of 1,000,000 of the Shares have been transferred in accordance with Section 8 and the transferees have agreed to become bound by this Agreement, which joinder agreements are attached hereto as Exhibit C.

 

2. Prohibited Transfers.  Stockholder will not (whether voluntarily, involuntarily, by operation of law or otherwise) sell, assign, gift, loan, pledge, mortgage, hypothecate, encumber or otherwise transfer or dispose of (collectively, “transfer”) any Shares or any interest in any of the Shares, except (i) to the Company, (ii) as permitted by Section 8, or (iii) in the case of Vested Shares (as defined below), in compliance with Section 5, and then only in compliance with the terms of this Agreement.

 

3. Vesting of Shares.

 

(a) Time Vesting.  As long as Stockholder maintains a Business Relationship (as defined below) with the Company on each of the following dates, the number of Shares set forth opposite each such date will vest on such date:

 

	
Date
    	
 
    	
Vested Shares
    
	
As   of the date of this Agreement
    	
 
    	
500,000 (25% of the   Shares)
    
	
 
    	
 
    	
 
    
	
On   the last day of each calendar month commencing one year from the date of this   Agreement
    	
 
    	
41,667   Shares (2.083% of the Shares); such that all Shares shall be vested on the   fourth anniversary of the date hereof.
    

 

For purposes of this Agreement, Stockholder will be deemed to have a “Business Relationship” with the Company as long as Stockholder is rendering substantial services as a director, employee or consultant to the Company.  The Board of Directors of the Company (the “Board”) will have the discretion to determine whether the Business Relationship between Stockholder and the Company has terminated and the effective date of that termination.

 

(b) Acceleration of Vesting upon Acquisition Event.  If an Acquisition Event (as defined below) occurs while Stockholder has a Business Relationship with the Company, then immediately prior

 

 

to the closing of such Acquisition Event, all of the remaining Unvested Shares will vest, provided, however, that if the acquirer of the Company requests that Stockholder continues to work with the acquirer of the Company (provided that the compensation paid to the Stockholder for this work is at least comparable to his compensation by the Company at the time of the Acquisition Event) for a period of up to two years after the Acquisition Event, then 25% of the consideration received by the Stockholder for his Shares in connection with the Acquisition Event (the “Unvested Consideration”) shall be subject to vesting to secure the Stockholders continued work with the acquirer of the Company, and the amount of consideration set forth opposite each such date will vest on such date:

 

	
Date
    	
 
    	
Vested Consideration
    
	
As   of the First Anniversary of the Acquisition Event
    	
 
    	
50% of the Unvested   Consideration
    
	
 
    	
 
    	
 
    
	
As   of the Second Anniversary of the Acquisition Event
    	
 
    	
50% of the Unvested   Consideration
    

 

For purposes of this Agreement, the term “Acquisition Event” will mean, in one or a series of related transactions, (1) the sale or other disposition of all or substantially all of the assets of the Company, (2) the sale or other disposition of all of the issued and outstanding stock of the Company, or (3) the merger or consolidation of the Company with or into another entity in which all of the issued and outstanding stock of the Company is converted into or exchanged for cash, securities of another entity, or other property; provided, in each case, that the stockholders of the Company immediately before such transaction do not, immediately thereafter, beneficially own (as such term is used in Rule 13d-3 under the Securities Exchange Act of 1934, as amended) a majority of the outstanding equity of the entity that acquires the Company’s assets or stock or of the surviving or resulting entity in such a merger or consolidation.

 

(c) Definitions.

 

(i) For purposes of this Agreement, the term “Cause” will mean (i) Stockholder’s intentional, willful or knowing failure or refusal to perform Stockholder’s duties (other than as a result of physical or mental illness, accident or injury) or any other material breach by Stockholder of the Employment Agreement between the Company and Stockholder (the “Employment Agreement”); (ii) dishonesty, willful or gross misconduct, or illegal conduct by Stockholder in connection with Stockholder’s employment with the Company; (iii) Stockholder’s conviction of, or plea of guilty or nolo contendere to, a charge of commission of a felony (exclusive of any felony relating to negligent operation of a motor vehicle); and (iv) a material breach by Stockholder of the confidentiality, non-competition and invention assignment agreement entered into between the Company and Stockholder; provided, however, in the case of clauses (i) and (iv) above, the Company shall be required to give Stockholder fifteen (15) calendar days prior written notice of its intention to terminate Stockholder for Cause and Stockholder shall have the opportunity during such fifteen (15) day period to cure such event if such event is capable of being cured; provided, further, that in the event that Stockholder terminates his employment with the Company during such fifteen (15) day period for any reason, such termination shall be considered a termination for Cause.

 

(ii) For purposes of this Agreement, the term “Good Reason” will mean (i) any adverse change in Stockholder’s title or any material diminution in Stockholder’s authority or responsibilities taken as a whole, (ii) any reduction of Stockholder’s base salary, other than pursuant to an across-the-board reduction in the compensation of all senior management of the Company; provided that such reduction is proportionately equal among all such members of senior management, (iii) any material breach by the Company of its obligations under the Employment Agreement, and (iv) a change without Stockholder’s consent in the principal

 

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location of Stockholder’s office to an office that is outside of the state of New Jersey, Pennsylvania or the New York City metropolitan area, such consent not to be unreasonably withheld; provided that in any case Stockholder provides the Company with written notice of Stockholder’s intention to terminate Stockholder’s employment for Good Reason within thirty (30) days after the occurrence of the event that Stockholder believes would constitute Good Reason, give the Company an opportunity to cure for thirty (30) days following receipt of such notice from Stockholder, if the event is capable of being cured or, if not capable of being cured, to have the Company’s representatives meet with Stockholder and Stockholder’s counsel to be heard regarding whether Good Reason exists for Stockholder to terminate Stockholder’s employment with the Company.

 

(d) Vested and Unvested Shares.  The term “Vested Shares” will mean all of the Shares that have vested pursuant to Sections 3(a), 3(b) and 3(c).  The term “Unvested Shares” will mean all of the Shares other than Vested Shares.

 

4. Company’s Purchase Option for Unvested Shares.

 

(a) Purchase Option.  Upon the occurrence of one or more of the following events, the Company will have the option (the “Purchase Option”) to purchase any or all of the Unvested Shares from Stockholder or her personal representative, as the case may be, at the Purchase Price per Share and on the other terms set forth in Section 4(b):

 

(A) Stockholder ceases to maintain a Business Relationship with the Company for any reason, including because of Stockholder’s resignation, death, disability or involuntary termination or removal, with or without cause; or

 

(B) Stockholder purports to transfer any Shares (whether voluntarily, involuntarily or by operation of law) in violation of the terms of this Agreement, including (i) any such transfer pursuant to a decree of divorce, dissolution or separate maintenance, any property settlement or any separation or other agreement under which any Shares are transferred or awarded to a spouse or required to be transferred (a “Divorce or Separation Transfer”), (ii) any such transfer pursuant to execution of judgment against any Shares, or (iii) any such transfer in connection with any bankruptcy or insolvency proceeding.

 

(b) Exercise of Purchase Option.  If the Company desires to exercise the Purchase Option, it will do so by delivering or sending to Stockholder, within one hundred and twenty (120) days after the Company first has written notice of the occurrence of the triggering event described in Section 4(a), a written notice specifying the number of Unvested Shares which the Company elects to purchase, the aggregate Purchase Price, and a date for the closing under this Section 4, which date will not be more than thirty (30) days from the date of such notice.  The closing of the purchase and sale of such Shares will take place at the principal offices of the Company or such other place as the Company and Stockholder may agree.  At the closing, Stockholder (along with any transferees permitted pursuant to the terms of Section 8 of this Agreement) will transfer to the Company the number of Unvested Shares specified in the Company’s notice, free of all liens, encumbrances and rights of others, by delivery of a certificate or certificates representing those Shares, duly endorsed for transfer or accompanied by duly executed stock powers.  Upon its receipt of such certificate or certificates, the Company will pay for such Unvested Shares by any of the following methods, chosen in sole discretion: (i) by delivery to Stockholder of a check in the amount of the aggregate Purchase Price; (ii) by reduction of indebtedness owed by Stockholder to the Company in that amount; or (iii) by a combination of the foregoing methods; provided, however, that in the event the funds of the Company legally available are insufficient to make such payment, in whatever method the Company may choose, those funds which are legally available will be used to make such payment and any unpaid portion of such payment will be paid at such time as funds

 

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become legally available.  Alternatively, the Company may assign the Purchase Option to one or more Persons.

 

5. Company’s Repurchase Right on Vested Shares.  If the Stockholder is terminated for Cause or leaves without Good Reason before the first anniversary of the date of this Agreement, the Company shall have the right (the “Repurchase Right”) to repurchase from the Stockholder (or any transferees permitted pursuant to the terms of Section 8 of this Agreement) 15% of the total number of Shares held by the Stockholder (or any transferees permitted pursuant to the terms of Section 8 of this Agreement) at the Purchase Price per Share.  The Repurchase Right may be exercised by the Company within the six (6) months following the date of such termination (the “Repurchase Period”).  The Repurchase Right shall be exercised by the Company by giving the Stockholder (or any transferees permitted pursuant to the terms of Section 8 of this Agreement) written notice on or before the last day of the Repurchase Period of its intention to exercise the Repurchase Right, and, together with such notice, tendering to the Stockholder (or any transferees permitted pursuant to the terms of Section 8 of this Agreement) an amount equal to the Purchase Price per Share.  The Company may assign the Repurchase Right to one or more Persons.  Upon such notification, the Stockholder (or any transferees permitted pursuant to the terms of Section 8 of this Agreement) shall promptly surrender to the Company any certificates representing the Vested Shares being purchased, together with a duly executed stock power for the transfer of such Vested Shares to the Company or the Company’s assignee or assignees.

 

6. Company’s Right of First Refusal on Vested Shares.

 

(a) Notice and Offer.  Subject to termination pursuant to Section 6(d), before any sale or other transfer of any Vested Shares in any manner (whether voluntary, involuntary, by operation of law or otherwise), Stockholder will give written notice thereof to the Company identifying the proposed transferee, the purchase price, if any, the terms of the proposed transaction, and offering such Shares (the “Offered Shares”) to the Company for purchase or other acquisition by it at the same price, if any, and on the same terms.  If the proposed transaction is a transfer for value, Stockholder must have a good faith reasonable expectation of being able to effect the transfer at the purchase price set forth in the notice, and the notice will state the basis for that expectation.

 

(b) Right of Refusal.  The Company will have thirty (30) days after actual receipt of such offer (the “Option Period”) to notify Stockholder in writing whether the Company elects to purchase or otherwise acquire all or any part of the Offered Shares.  Any such notice will specify the number of Offered Shares which the Company elects to purchase or otherwise acquire and a date for the closing under this Section 6, which date will not be more than thirty (30) days from the date of such notice.  The closing of the purchase or other acquisition of such Shares will take place at the principal offices of the Company or such other place as the Company and Stockholder may agree.  At the closing, Stockholder will transfer to the Company the number of Offered Shares specified in the Company’s notice, free of all liens, encumbrances and rights of others, by delivery of a certificate or certificates representing those Shares, duly endorsed for transfer or accompanied by duly executed stock powers, against payment therefor at the same price, if any, and according to the same terms as were offered by the proposed transferee (or, at the Company’s option, in full on the closing date).  In the event that all or part of the price, if any, stated in Stockholder’s offer is not cash or cash equivalents, the Company may elect instead to pay the fair value in cash (as determined by the Board) of that part of the stated price.  The Company will have no obligation to purchase or otherwise acquire any of the Offered Shares, and failure by the Company to notify Stockholder within the Option Period of an election to purchase will be deemed an election not to purchase.

 

(c) Transfer to Third Party.  If the Company has not elected within the Option Period to purchase all of the Offered Shares, then within thirty (30) days from the end of the Option Period Stockholder may transfer any Offered Shares which the Company has not elected to purchase or

 

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otherwise acquire, but only to the proposed transferee at the same price, if any, and according to the same terms as Stockholder previously notified the Company.  Shares that are so transferred will remain subject to the rights of the Company set forth in this Agreement.

 

(d) Lapse.  All of Stockholder’s obligations, and all of the Company’s rights, with respect to future transfer of Vested Shares under this Section 5 will terminate and will be of no further force or effect upon the earlier to occur of (i) an underwritten public offering of the Company’s equity pursuant to an effective registration statement under the Securities Act of 1933, as amended, or (ii) an Acquisition Event.

 

7. Further Agreements Regarding Transfers.

 

(a) Stock Transfer Records.  Any attempted transfer of any Shares in violation of the terms of this Agreement will be ineffective to vest any legal or beneficial interest in the Shares in any transferee and will be null and void.  The Company will not be required to transfer any Shares on its stock transfer records unless the transfer is in compliance with the provisions of this Agreement.  Nor will the Company be required to treat as the owner of the Shares, or to accord the right to vote or to pay dividends to, any person or entity to which such Shares have purportedly been transferred in violation of this Agreement.  Nevertheless, the Board may in any particular circumstances waive any of the restrictions on transfer of the Shares provided for hereunder.

 

(b) Custody of Certificates.  To facilitate the exercise of the Company’s rights hereunder, the Company or its counsel will hold all certificates representing Unvested Shares, together with such number of undated and otherwise blank stock powers executed by Stockholder as the Company may request in the form of Exhibit A attached hereto.  Without limiting the generality of the foregoing, the Company will have the right to cause transfers of such Unvested Shares to be effected pursuant to Section 4(b) of this Agreement; provided, however that no transfer of Unvested Shares will be effected hereunder unless the Company has complied with its obligations under this Agreement.

 

8. Certain Permitted Transfers.  Notwithstanding the foregoing, Stockholder may transfer any or all of the Shares to: (i) any member of Stockholder’s immediate family or any trust for the benefit of Stockholder or any such family member, other than pursuant to any Divorce or Separation Transfer; or (ii) by will or the laws of descent and distribution.  Prior to and as a condition of any transfer described in the preceding sentence, the transferee will agree (in a written agreement which will be satisfactory in form and substance to the Company and its counsel) to be bound by all of the provisions of this Agreement in the same manner as Stockholder, and, whether or not the transferee so agrees, the Shares will remain subject to, and the transferee will be bound by, those provisions (including the vesting provisions, which will continue to relate to Stockholder’s Business Relationship with the Company).  Upon any permitted transfer and absent the Company’s prior written approval to the contrary, the number of Unvested Shares and Vested Shares transferred to the transferee will be in the same proportion as the number of Unvested and Vested Shares held by Stockholder immediately prior to the transfer, and all subsequent vesting of Unvested Shares will be attributed in the same proportion between Stockholder and the transferee.  For purposes of this Section 8, “immediate family” will mean Stockholder’s spouse and lineal descendants (including stepchildren and adopted children).

 

9. Adjustments for Stock Splits, Mergers, etc.

 

(a) If from time to time during the term of this Agreement there is any stock split, stock dividend, combination of shares, recapitalization or reclassification affecting the Common Stock, then the provisions of this Agreement will apply to all securities received by Stockholder in respect of the Shares, in the same manner and to the same extent as the Shares, and thereafter such securities will for all purposes be deemed to be Shares hereunder.  In any such event, the Purchase Price and the other

 

5

 

provisions hereof will be appropriately adjusted, if necessary, so that they will continue to apply with similar effect to such newly constituted Shares.

 

(b) If the Shares are converted into or exchanged for, or stockholders of the Company receive by reason of any distribution in total or partial liquidation, securities of another entity, or other property (including cash), pursuant to any merger or consolidation of the Company or acquisition of its assets, then provided that the agreement by which any such transaction is effected does not expressly provide otherwise, the rights of the Company under this Agreement will inure to the benefit of the Company’s successor and the provisions of this Agreement will apply to all securities or other property received by Stockholder upon such conversion, exchange or distribution in respect of the Shares, in the same manner and to the same extent as the Shares, and thereafter such securities or other property will for all purposes be deemed to be Shares hereunder.  In any such event, the Purchase Price and the other provisions hereof will be appropriately adjusted, if necessary, so that they will continue to apply with similar effect to such newly constituted Shares.

 

10. Certain Remedies of the Company.

 

(a) Failure to Deliver Shares to the Company.  The Company will have a continuing right and option (but not an obligation) to purchase or acquire the Shares purported to be transferred by or for Stockholder for a price, if any, and on terms the same as those at which such Shares could have been purchased hereunder at the time of the transfer.  Thus, if Stockholder becomes obligated to sell any Shares to the Company under this Agreement and fails to deliver such Shares in accordance with the terms of this Agreement, the Company, may, at its option at any time, in addition to all other remedies it may have, send to Stockholder the purchase price for such Shares which is specified in this Agreement.  Thereupon, upon written notice to Stockholder, the Company may cancel on its books the certificate or certificates representing the Shares to be sold, and may issue, in lieu thereof, in the name of the Company a new certificate or certificates representing such Shares, and thereupon all of Stockholder’s rights in and to such Shares will terminate.

 

(b) Specific Enforcement.  Stockholder expressly agrees that the Company will be irreparably damaged if this Agreement is not specifically enforced.  Upon a breach or threatened breach of this Agreement by Stockholder, the Company will, in addition to all other remedies, be entitled to a temporary or permanent injunction or a decree for specific performance, without showing any actual damage or posting any bond, in accordance with the provisions hereof.

 

(c) Cumulative.  The rights and remedies of the Company hereunder will be cumulative and in addition to all other rights and remedies the Company may have, at law, in equity, or otherwise.

 

11. Representations and Acknowledgments of Stockholder.  Stockholder hereby represents, warrants and agrees that:

 

(a) Investment.  Stockholder is acquiring the Shares for Stockholder’s own account, and not directly or indirectly for the account of any other person or entity.  Stockholder is acquiring the Shares for investment and not with a view to distribution or resale thereof except in compliance with the Act and any applicable state law regulating securities.

 

(b) Access to Information.  Stockholder has had the opportunity to ask questions of, and to receive answers from, appropriate executive officers of the Company with respect to the transactions contemplated hereby and with respect to the business, affairs, financial condition and results of operations of the Company.  Stockholder has had access to such financial and other information as is necessary in order for Stockholder to make a fully informed decision as to investment in the Company, and has had the opportunity to obtain any additional information necessary to verify any of such information to which Stockholder has had access.

 

6

 

(c) Pre-Existing Relationship.  Stockholder further represents and warrants that Stockholder has either (i) a pre-existing relationship with the Company or one or more of its officers or directors consisting of personal or business contacts of a nature and duration which enable Stockholder to be aware of the character, business acumen and general business and financial circumstances of the Company or the officer or director with whom such relationship exists or (ii) such business or financial expertise as to be able to protect Stockholder’s own interests in connection with the purchase of the Shares.

 

(d) Speculative Investment.  Stockholder’s investment in the Company represented by the Shares is highly speculative in nature and is subject to a high degree of risk of loss in whole or in part; the amount of such investment is within Stockholder’s risk capital means and is not so great in relation to Stockholder’s total financial resources as would jeopardize the personal financial needs of Stockholder and Stockholder’s family in the event such investment were lost in whole or in part.

 

(e) Unregistered Securities.  Stockholder will bear the economic risk of investment for an indefinite period of time because the Shares have not been registered under the under the Securities Act of 1933, as amended, (the “Act”) and therefore cannot and will not be sold unless they are subsequently registered under the Act or an exemption from such registration is available.  The Company has made no representations, warranties or covenants whatsoever as to whether any exemption from the Act, including, without limitation, any exemption for limited sales in routine brokers’ transactions pursuant to Rule 144 under the Act, will become available and any such exemption pursuant to Rule 144, if available at all, will not be available unless: (i) a public trading market in the Common Stock then exists, (ii) adequate information as to the Company’s financial and other affairs is then available to the public, and (iii) all requirements of Rule 144 have been satisfied.  Transfer of the Shares has not been registered or qualified under any applicable state law regulating securities and therefore the Shares cannot and will not be sold unless they are subsequently registered or qualified under any such law or an exemption therefrom is available.  The Company has made no representations, warranties or covenants whatsoever as to whether any exemption from any such act will become available.

 

12. Legends.  Stockholder hereby agrees that the Company may maintain “stop transfer” orders with respect to the Shares, and that each certificate or other document evidencing the Shares will bear conspicuous legends in substantially the following forms as well as such other legends as the Company may reasonably require:

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.  THE SECURITIES MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER SUCH ACT, OR AN OPINION OF COUNSEL FOR THE CORPORATION THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT.

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES OR “BLUE SKY” LAWS OF ANY JURISDICTION.  THEY MAY NOT BE OFFERED OR SOLD WITHOUT AN OPINION OF COUNSEL TO THE CORPORATION TO THE EFFECT THAT THE PROPOSED TRANSACTION WILL BE EXEMPT FROM REGISTRATION, QUALIFICATION AND FILINGS IN ALL APPLICABLE JURISDICTIONS.

 

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RIGHTS OF PURCHASE AND RESTRICTIONS ON TRANSFER SET FORTH IN AN AMENDED AND RESTATED STOCK PURCHASE AND

 

7

 

RESTRICTION AGREEMENT DATED AS OF NOVEMBER       , 2009, A COPY OF WHICH THE COMPANY WILL FURNISH TO THE HOLDER OF THIS CERTIFICATE UPON REQUEST AND WITHOUT CHARGE.

 

13. “Lock-Up” Agreement.  Stockholder will not sell, offer, pledge, contract to sell, grant any option or contract to purchase, purchase any option or contract to sell, grant any right or warrant to purchase, lend or otherwise transfer or encumber, directly or indirectly, any Shares or other securities of the Company, nor will Stockholder enter into any swap, hedging or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Shares or other securities of the Company, during the period from the filing of the first registration statement of the Company under the Act that includes securities to be sold on behalf of the Company to the public in an underwritten public offering under the Act through the end of the 180-day period following the effective date of such registration statement (or such other period as may be requested by the Company or the underwriters to accommodate regulatory restrictions on (i) the publication or other distribution of research reports and (ii) analyst recommendations and opinions, including, without limitation, the restrictions contained in NASD Rule 2711, or any successor provisions or amendments thereto).  Stockholder further agrees, if so requested by the Company or any representative of the underwriters, to enter into such underwriter’s standard form of “lockup” or “market standoff” agreement in a form satisfactory to the Company and such underwriter.  The Company may impose stop-transfer instructions with respect to securities subject to the foregoing restrictions until the end of any such restriction period.

 

14. Tax Matters.

 

(a) No Reliance.  Stockholder acknowledges that Stockholder has not relied and will not rely upon the Company or the Company’s counsel with respect to any tax consequences related to the ownership, purchase, or disposition of the Shares.  Stockholder assumes full responsibility for all such consequences and for the preparation and filing of all tax returns and elections which may or must be filed in connection with such Shares.

 

(b) 83(b) Election.  Stockholder understands that Section 83(a) of the Internal Revenue Code of 1986, as amended (the “Code”) taxes as ordinary income the difference between the amount paid for the Shares and the fair market value of the Shares as of the date any restrictions on the Shares lapse.  In this context, “restriction” means the right of the Company to buy back the Unvested Shares pursuant to Section 4.  Stockholder understands that Stockholder may elect to be taxed at the time the Shares are purchased, rather than when and as the Purchase Option expires, by filing an election under Section 83(b) (an “83(b) Election”) of the Code with the Internal Revenue Service within 30 days from the date of purchase.  Even if the fair market value of the Shares at the time of the execution of this Agreement equals the amount paid for the Shares, the election must be made to avoid income under Section 83(a) in the future.  Stockholder understands that failure to file such an election in a timely manner may result in adverse tax consequences for Stockholder.  Stockholder further understands that an additional copy of such election form should be filed with her federal income tax return for the calendar year in which the date of this Agreement falls.  Stockholder acknowledges that the foregoing is only a summary of the effect of United States federal income taxation with respect to purchase of the Shares hereunder, and does not purport to be complete.  Stockholder further acknowledges that the Company has directed Stockholder to seek independent advice regarding the applicable provisions of the Code, the income tax laws of any municipality, state or foreign country in which Stockholder may reside, and the tax consequences of Stockholder’s death.

 

(c) Stockholder Decision.  Stockholder agrees that she will execute and deliver to the Company with this executed Agreement a copy of the Acknowledgment and Statement of Decision Regarding Section 83(b) Election (the “Acknowledgment”), attached hereto as Exhibit B.

 

8

 

15. General.

 

(a) Notices.  Any and all notices, requests or other communications hereunder will be given in writing and delivered in person or sent by registered or certified mail, return receipt requested, postage prepaid; and such notices will be addressed: (i) if to the Company, to the President of the Company at its principal office, and (ii) if to Stockholder, to the address of Stockholder as reflected in the records of the Company, unless notice of a change of address is furnished to all parties by written notice in accordance with this Section 15(a).  Any notice which is required to be made within a stated period of time will be considered timely if delivered or mailed as provided above before midnight of the last day of such period.

 

(b) Severability.  The invalidity or unenforceability of any provision of this Agreement will not affect the other provisions hereof, and each provision of this Agreement will be enforced to the maximum extent permitted by law and, to the extent invalid or unenforceable, will be severable.  Without limiting the generality of the foregoing, if the exercise of the Company’s right of first refusal set forth in Section 6 is deemed to be unenforceable by a court of competent subject matter because the price paid or to be paid by the Company in accordance with the terms of Section 6 would give rise to an inequitable result on account of Stockholder, the Company will have the right, but not the obligation, to pay the fair market value, as determined by the Board, for the Offered Shares in lieu of such price.

 

(c) Independent Counsel.  Stockholder acknowledges that this Agreement has been prepared on behalf of the Company by Goodwin Procter LLP, counsel to the Company, and that Goodwin Procter LLP does not represent, and is not acting on behalf of, Stockholder.  Stockholder has been provided with an opportunity to consult with Stockholder’s own counsel with respect to this Agreement.

 

(d) Benefit and Burden; Assigns.  This Agreement will inure to the benefit of, and be binding upon, the Company and its successors and assigns and Stockholder and Stockholder’s legal representatives, heirs, legatees, distributees, assigns and transferees, provided this will not limit any of Company’s rights hereunder, and whether or not any such person or entity will have become a party to this Agreement and have agreed in writing to join herein and be bound by the terms hereof.  Without limiting the foregoing, the Company may assign its rights under Sections 3 and 5, in whole or in part, to one or more persons or entities designated by the Board.

 

(e) Participation by Stockholder in Company Decisions.  Stockholder will not participate (whether as a director, stockholder or otherwise) in any decision of the Company whether to exercise its purchase rights or any other rights or remedies hereunder in relation to the Shares, except that, if Stockholder’s vote as a director or stockholder is required for valid corporate action she will vote in accordance with the decision of the majority of the other directors or stockholders, as the case may be.

 

(f) Withholding Taxes.  If, with respect to the transactions contemplated by this Agreement, including the 83(b) Election described in Section 14, the Company will be required to withhold amounts under applicable federal, state, local or other tax laws, the Company will be entitled, at its option, to (i) deduct and withhold such amounts from any cash payment to be made by the Company to Stockholder or to such other person or entity with respect to whom such withholding may arise, (ii) require Stockholder (or such other person or entity) to make payment to the Company in such amount as is required to be withheld, or (iii) retain and withhold such number of Shares as will have a fair market value, valued on the date on which such withholding requirement arises, equal to such amount as is required to be withheld.

 

(g) Headings; Construction.  The headings, subheadings and other captions in this Agreement are for convenience of reference only and will not be used in interpreting, construing or enforcing any of the provisions of this Agreement.  Except as may be expressly provided to the contrary, all Section references in this Agreement refer to the sections of this Agreement.  As used herein,

 

9

 

“including” will mean “including but not limited to,” and “herein” and “hereunder” refer to this Agreement as a whole.

 

(h) Other Agreements and Restrictions.  This Agreement does not and will not be construed to limit or impair the rights of the Company under any other agreement or understanding with Stockholder, now in effect or arising hereafter.  The restrictions on transfer of the Shares set forth in this Agreement are in addition to any other restrictions on transfer of the Shares, including restrictions arising under contract and applicable securities laws.

 

(i) Entire Agreement; Amendments.  This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and neither this Agreement nor any provision hereof may be modified, amended or terminated except by a written agreement signed by the parties hereto.  This Agreement replaces the Original Agreement.

 

(j) Governing Law; Jurisdiction.  This Agreement, and any claims relating to the relationship of the parties contemplated herein, whether or not arising directly under this Agreement, will be governed by the laws of the State of New Jersey without reference to its conflicts of laws provisions.  All litigation arising from or relating to this Agreement will be filed and prosecuted before any court of competent subject matter jurisdiction in the State of New Jersey.  Stockholder consents to the jurisdiction of such courts over Stockholder, stipulates to the convenience, efficiency and fairness of proceeding in such courts, and covenants not to allege or assert the inconvenience, inefficiency or unfairness of proceeding in such courts.

 

(k) Stockholder Undertaking.  Stockholder hereby agrees to take whatever additional action and execute whatever additional documents the Company may in its judgment deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on Stockholder or the Shares pursuant to this Agreement.

 

(l) Waivers.  No waiver of any breach or default hereunder will be considered valid unless in writing, and no such waiver will be deemed a waiver of any subsequent breach or default of the same or similar nature.

 

(m) No Right to Employment.  Nothing in this Agreement will impose any obligation on the Company to hire, appoint or retain Stockholder as an employee, officer, director, consultant or otherwise, or to maintain any Business Relationship with Stockholder.

 

(n) Counterparts.  This Agreement may be executed in two counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

 

[remainder of this page intentionally left blank]

 

10

 

IN WITNESS WHEREOF, this Amended and Restated Stock Purchase and Restriction Agreement has been executed as of the date first above written.

 

	
 
    	
COMPANY:
    
	
 
    	
 
    
	
 
    	
OMTHERA   PHARMACEUTICALS, INC.
    
	
 
    	
a   Delaware corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Michael Davidson
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Michael   Davidson
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
Chief   Medical Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
STOCKHOLDER:
    
	
 
    	
 
    
	
 
    	
GERALD   WISLER
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
/s/   Gerald Wisler
    

 

CONSENT OF SPOUSE
 (if applicable)

 

By execution of this Agreement, the undersigned spouse of Stockholder agrees to be bound by the terms of this Agreement as to his or her interest, whether as community property or otherwise, if any, in the Shares purchased hereby.  The undersigned spouse acknowledges that he or she has been advised to obtain independent counsel to represent his or her interests with respect to this Agreement but that he or she have declined to do so and he or she hereby expressly waives his or her right to such independent counsel.

 

	
 
    	
 
    	
/s/   Damarys G. Wisler
    
	
 
    	
Stockholder’s   Spouse, if applicable
    

 

 

Exhibit A

 

STOCK POWER

 

FOR VALUE RECEIVED,                                          hereby sell(s), assign(s) and transfer(s) unto Omthera Pharmaceuticals, Inc. (the “Company”)                                      (                        ) shares of the Common Stock of the Company standing in                              name on the books of the Company represented by Certificate No.            herewith and do hereby irrevocably constitute and appoint                                              Attorney to transfer the said stock on the books of the Company with full power of substitution in the premises.

 

	
Date:
    	
 
    	
 
    	
 
    
	
 
    	
Gerald   Wisler
    

 

 

Exhibit B

 

ACKNOWLEDGEMENT AND STATEMENT OF DECISION
 REGARDING SECTION 83(b) ELECTION

 

The undersigned, a purchaser of shares of Common Stock of Omthera Pharmaceuticals, Inc. (the “Company”) and a party to a Stock Purchase and Restriction Agreement with the Company (the “Agreement”), hereby states as follows:

 

1.              I acknowledge receipt of a copy of the Agreement.  I have carefully reviewed the Agreement and in particular Section 14 of the Agreement.

 

2.              I either [check as applicable]

 

o (a)                                          have consulted, and have been fully advised by, my tax advisor, whose name and business address are:

 

 

 

regarding the federal, state, and local tax consequences of purchasing shares of Common Stock under the Agreement, and particularly regarding the advisability of making elections pursuant to Section 83(b) of the Internal Revenue Code of 1986, (the “Code”), and pursuant to any corresponding provisions of applicable state laws; or

 

o (b)                                          have knowingly chosen not to consult such a tax advisor.

 

3.              I have decided [check as applicable]:

 

o (a)                                          to make an election pursuant to Section 83(b) of the Code by filing an election form with the appropriate tax authorities within 30 days of the undersigned’s purchase under the Agreement, and am submitting to the Company, together with my executed Agreement, a copy of an executed election form; or

 

o (b)                                          not to make an election pursuant to Section 83(b) of the Code.

 

I acknowledge that, even if the Company files, or engages another party to file, a Section 83(b) election form with the Internal Revenue Service as an accommodation to me, I have the primary responsibility for timely filing any Section 83(b) election with the Internal Revenue Service and any state revenue authorities, and will hold the Company and its agents harmless from any failure to timely file a copy of the Section 83(b) election.

 

	
Date:
    	
 
    	
 
    	
 
    
	
 
    	
Gerald   Wisler
    

 

 

ELECTION UNDER SECTION 83(b)
 OF THE INTERNAL REVENUE CODE

 

I hereby elect, under Section 83(b) of the Internal Revenue Code, to include in gross income any excess of the fair market value of the property described in paragraph 2, disregarding any lapse restrictions on that property, over the amount I paid for such property, as described below.

 

1.              My name, address and taxpayer identification number are:

 

	
Name:
    	
 
    	
Gerald   Wisler
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Social   Security Number:
    	
 
    	
 
    

 

2.              The property with respect to which this election is made consists of 2,000,000 shares of common stock (the “Shares”) of Omthera Pharmaceuticals, Inc. (the “Company”).

 

3.              The date on which the Shares were acquired was December       , 2008, and the taxable year to which this election relates is calendar year 2008.

 

4.              The Shares are subject to the following restrictions: the right of the Company to repurchase 75% of the Shares at the initial purchase price.  This right lapses based on my continued performance of services over time.

 

5.              The fair market value of the Shares at the time of transfer (determined without regard to any restrictions other than restrictions which by their terms will never lapse) was $         per share.

 

6.              The amount paid for the Shares was $0.001 per share.

 

7.              A copy of this election has been furnished to the Company.  I am the person performing services and the transferee of the Shares.

 

 

	
 
    	
 
    	
 
    
	
Signature
    	
Date
    

 

The spouse of the taxpayer acknowledges the making of this election.

 

 

	
 
    	
 
    	
 
    
	
Signature
    	
 
    

 

 

Exhibit C

 

JOINDER AGREEMENT

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