Amendment No. 1 to Employment Agreement with Michael Wittekind, PhD.
This Amendment No. 1 (the Amendment) is entered into by and between ContraFect Corporation (the Employer), and Michael Wittekind, (the Employee), as of November 12, 2015.
WHEREAS, pursuant to Section 15 of the Employment Agreement, the Employer and the Employee desire to amend the Employment Agreement in accordance with the terms of this Amendment, as more fully set forth herein.
THEREFORE, in consideration of the mutual agreements set forth below, the Employer and the Employee agree to amend the Employment Agreement as follows:
|1.||Section 4 of the Employment Agreement is amended by adding the following:|
You will be eligible for an annual incentive bonus of 35% of your annual base salary, subject to performance against mutually agreed-upon goals (effective January 1, 2016, 70% corporate/30% individual). You will also be eligible for stock option grants on an annual basis.
|2.||Section 7d of the Employment Agreement is amended to read as follows:|
In the event that you are terminated by the Company without Cause, or in the event that you resign with Good Reason, as defined below, you will be given (i) a severance payment in the amount that is equal to twelve (12) months of your then-current base salary, (ii) a payment equal to twelve (12) months of bonus and (iii) a payment equal to twelve (12) months of applicable health insurance premiums (inclusive of dental and vision insurance) due under COBRA, provided that you first sign a Severance and Release Agreement in a form prescribed by the Company. These severance payments shall be paid over twelve (12) months as any regular paycheck.
Good Reason shall mean the occurrence of any of the events or conditions as described here: (i) a material diminution of your authority, duties and responsibilities; (ii) a material reduction in your then-effective base salary, or (iii) the relocation of your principal place of employment to a location that is more than fifty (50) miles as the crow flies from Yonkers, New York. Employee must provide written notice (Notice of Good Reason) to Employer of the existence of a condition described in subsections (i) through (iii) above within 30 days of Employees knowledge of the initial existence of the condition or such right is waived. The Notice of Good Reason shall fully set forth the facts
comprising the event(s) or circumstance(s) giving rise to Good Reason. Employer shall have a period (the Good Reason Notice Period) of 30 days during which it may remedy the condition so that it shall not constitute Good Reason or inform Employee that it does not believe Good Reason exists. If Employee believes that the condition has not been cured, or that Good Reason exists notwithstanding Employers belief that it does not, then Employee shall either abandon the contention that Good Reason exists or terminate employment within 30 days of the Employers written response. If Employee continues to work beyond the 30th day without resigning, Employee shall be deemed to have waived Good Reason for the event(s) or circumstance(s) set forth in the Notice of Good Reason.
If there is a Change of Control Event and, within twelve (12) months of such Change of Control Event, you resign for Good Reason or you are terminated without Cause, you will receive the severance benefits as outlined above, and, in addition, your then-outstanding stock options and other equity awards, if any, will become immediately fully vested and exercisable. All such benefits are conditioned upon the execution of a Severance and Release Agreement in a form prescribed by the Company or its successors.
A Change of Control Event means any of the following: (i) any person, or persons acting as a group, or entity (except for a current stockholder) becomes the beneficial owner of greater than 50% of the then-outstanding voting power of the Company; (ii) a change in the composition of the Board of Directors, as a result of which fewer than a majority of the directors are Incumbent Directors. Incumbent Directors shall mean directors who either (a) are directors of the Company as of the date hereof, or (a) are elected, or nominated for election, to the Board with the affirmative votes of at least a majority of those directors whose election or nomination was not in connection with any transaction described in subsections (i), (iii) or (iv) or in connection with an actual or threatened proxy contest relating to the election of directors of the Company; (iii) a merger or consolidation with another entity where the voting securities of the Company outstanding immediately before the transaction constitute less than a majority of the voting power of the voting securities of the surviving entity outstanding immediately after the transaction, or (iv) the sale or disposition of all or substantially all of the Companys assets.
|3.||Section 10 of the Employment Agreement is amended to read as follows:|
(a) Non-competition. Employee acknowledges that Employees duties hereunder and the services Employee will provide to Employer are of a special,
unique, unusual and extraordinary character, which gives this Agreement particular value to Employer, and that the knowledge Employee will learn while working for Employer is such that it will necessarily be valuable to a competitor and almost impossible to keep confidential if Employee were to work for a competitor. Therefore, during the Term and for a period of one year after Employees termination of employment for any reason (such period, the Restricted Period), Employee will not, directly or indirectly, enter into, organize, control, engage in, be employed by, serve as a consultant to, be an officer or director of, or have any direct investment of more than 5% of the outstanding shares in, any business, person, partnership, association, firm, corporation, or other entity engaged in any business activity (including, but not limited to, research, development, manufacturing, selling, leasing, licensing or providing services) which is competitive with the business of Employer. For purposes of this Agreement, a business activity is competitive with the business of Employer if it is being done on behalf of any business, person, partnership, association, firm, corporation, or other entity that owns, develops, sells, researches, or licenses scientific information or products involving any lysins; or antibodies specific for the treatment of human pathogens being addressed by any of the Employers current or planned research or development antibody programs. This does not preclude Employee working for a diversified biotech company that discovers and develops therapies to address multiple therapeutic areas (including, without limitation, oncology, inflammation, metabolic disease or neurology in addition to infectious disease), as long as Employee does not directly or indirectly engage in work and projects aimed at addressing infectious disease using lysins or antibodies in ways that would directly compete with Employer during the Restricted Period.
(b) Non-diversion. During the Restricted Period, Employee will not divert or attempt to divert or take advantage of or attempt to take advantage of any actual or potential business or opportunities of Employer.
(c) Non-recruitment. Employee acknowledges that Employer has and will continue to invest substantial time and effort in assembling its workforce. Accordingly, Employee agrees that, during the Restricted Period, Employee will not directly or indirectly (i) hire away any individuals who were employed by, or providing independent contractor services to, Employer during the one-year period prior to the date of termination of Employees service with Employer, or (ii) directly or indirectly, entice, solicit or seek to induce or influence any such employees or independent contractors to leave or curtail their service with Employer or to provide services to others. In addition, during the Restricted Period, Employee agrees that Employee will not directly or indirectly solicit or induce or attempt to solicit or induce any customer of Employer for the benefit of Employee or any other business venture to discontinue its business relationship
with Employer or its business with Employer, reduce the amount of business which any such customer has customarily done or contemplating doing with Employer or to refrain from entering into a new business relationship with Employer.
Section 409A. The Company and you intend, and this Amendment No. 1 to the Employment Agreement shall be construed, that any amounts or benefits payable or provided under this Amendment and the Companys and your exercise of authority or discretion hereunder shall either be exempt from or comply with the provisions of Section 409A of the Internal Revenue Code of 1986, as amended (the Code) and the treasury regulations relating thereto so as not to subject you to the payment of the tax, interest and any tax penalty which may be imposed under Code Section 409A. The provisions of this Amendment shall be interpreted and construed in a manner consistent with such intent. In the event that any provision of this Amendment would otherwise fail to satisfy the requirements of Section 409A and the treasury regulations relating thereto, the Company and you agree to further amend this Amendment to maintain to the maximum extent practicable the original intent of the provision without violating the requirements of Code Section 409A. Notwithstanding anything in this Amendment, you acknowledge and agree that the Company has not made any representations to you as to the tax treatment of any payments or benefits under this Amendment, and the Company does not guarantee the tax treatment of any payments or benefits under this Agreement, including without limitation pursuant to Section 409A of the Code, federal, state, or local tax laws or regulations.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed and delivered as of the date first written above.
|/s/ Julia P. Gregory|
|Julia P. Gregory|
|Chief Executive Officer|
|/s/ Michael Wittekind|
|Michael Wittekind, PhD.|