CTO Employment Agreement, Oren Becker, PH.D.

Exhibit 10.14


BIO-I.T. (BIO INFORMATION TECHNOLOGIES) LTD.


EMPLOYMENT AGREEMENT


WITH


DR. OREN BECKER


AGREEMENT dated as of October 31, 2000, between Dr. Oren Becker (the "EMPLOYEE"), whose address is [ADDRESS], and BIO-I.T. (BIO INFORMATION TECHNOLOGIES) LTD. (the "COMPANY"), a corporation incorporated under the laws of the State of Israel, having its address at 12A Kibush Ha'voda Street, Hertzeliya, Israel.


WITNESSETH


WHEREAS the Employee is a Co-Founder of the Company, and the Company desires to employ the Employee as its Chief Technology Officer ("CTO") with duties as set forth in Section 2 below; and


WHEREAS the Employee represents he has the desired skills and knowledge to serve in such positions.


NOW THEREFORE, in consideration of the premises and mutual agreements hereinafter contained, the parties hereto agree as follows:


1. Employment


From the Effective Date (as defined in Section 3), the Company hereby employs Employee and Employee accepts employment with Company upon the conditions set forth herein.


2. Duties


(a) The Company hereby engages Employee to serve as its CTO to be
responsible for the following: (i) the technological aspect of the
Company's research and development; (ii) preparation and demonstration of
scientific presentations and as otherwise may be determined by the
Company; (iii) assist and support the management and operation of the
Company's business and development; and (iv) to perform other tasks, as
shall be determined, from time to time by the Company's board of directors
(the "DUTIES"). During the term hereof, Employee shall report to the
Company's.


(b) In addition to the discharge of his Duties hereunder in the premises
of the Company, Employee shall make his services hereunder available by
telephone during normal business hours, and at such times or at such other
places as may mutually be agreed upon between the Company and the
Employee. Without derogating from the foregoing, at the request and
pursuant to the instructions of


the Company, Employee shall discharge his Duties and/or perform any
specific task hereunder outside of Israel.


(c) Employee shall provide the services hereunder on a full-time basis and
shall devote all necessary time and attention to the furtherance of the
business and interests of the Company, and shall perform his Duties
diligently and promptly for the benefit of Company, strictly and
faithfully upholding the Company's policies. During his engagement
hereunder, Employee shall not, without prior written consent of the board
of directors, undertake or accept any other paid or unpaid employment,
occupation of services as a consultant or otherwise, or engage in or be
associated with, directly or indirectly, any other businesses, duties or
pursuits, including, without limitation, any academic occupation, except
for strictly de-minimus non-commercial or non-business activities, which
do not affect the adequate performance of the Employee's obligations
hereunder.


3. Term


(a) The Employee's employment under this Agreement shall commence
immediately after the Closing of the Company's 1st Round of Financing (as
defined in the Founders Agreement to which this Agreement constitutes a
schedule) (the "EFFECTIVE DATE") and shall end on the earliest of: (i) the
death or disability (as defined herein) of the Employee; (ii) the
termination of Employee's services by Company for Cause (as defined
herein); or (iii) four (4) years from the Effective Date, unless earlier
terminated without cause by either party on sixty (60) days prior written
notice to the other (the "INITIAL TERM"). This Agreement may be extended
by the mutual written consent of the parties. Any period of extension
shall be referred to as an "EXTENDED TERM."


(b) For the purpose of this Section 3, "DISABILITY" shall mean any
physical or mental illness or injury as a result of which the Employee
remains absent from work for a period of two (2) successive months, or an
aggregate of two (2) months in any twelve (12) month period. Disability
shall occur upon the end of such two (2) month period.


(c) For the purpose of this Section 3, "CAUSE" shall exist if the Employee
(i) breaches any of the material terms or conditions hereof including
without limitation, any of the terms of Sections 7, 8, 9 and 10; (ii)
fails to perform a significant portion of his tasks as determined by the
board of directors; or (iii) engages in willful misconduct or acts in bad
faith towards Company or any of its subsidiaries and/or affiliates with
and related to the employment hereunder; or (iv) commits a felony or
perpetrates fraud against the Company and/or any of its subsidiaries
and/or affiliates.


(d) During the sixty (60) day period following the notice of termination
by any party to this Agreement, Employee shall cooperate with Company and
use his best efforts to assist the integration into Company of the person
or persons who will assume Employee's responsibilities.


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4. Compensation


(a) The Company shall pay Employee a salary payable monthly and in accordance with Company's normal and reasonable payroll practices, in a yearly gross amount of NIS 413,7000 (the "YEARLY GROSS SALARY"). This Yearly Gross Salary shall be payable over a period of twelve months, in equal monthly payments of NIS 34,475 each (the "MONTHLY GROSS SALARY"). The Monthly Gross Salary is exclusive of amounts payable by Company for the social benefits set forth in Sections 4(b), 4(c), 4(d) an 4(e) and exclusive of the benefit in Section 5A below, for the duration of this Agreement. The Monthly Gross Salary shall be linked to the Israeli Consumer Price Index.


(a1) If and subject to the Company completing a second round of financing in which the investors in such round invest at least USD$4,000,000 (the "2ND FINANCING ROUND"), then following 2nd Financing Round the Employee's Yearly Gross Salary shall be increased by ten percent (10%). This newly increased Yearly Gross Salary shall be payable in accordance with the provisions of sub-section (a) above and the other sub-sections of this Section 4.


(a2) Following the 2nd Financing Round, at the end of each year of employment hereunder, the Company shall conduct a review of Employee's Yearly Gross Salary. Any changes in Employee's Yearly Gross Salary after such 2nd Financing Round shall be in the sole discretion of the Company's Board of Directors. When reviewing the Employee's Yearly Gross Salary, the Board of Directors shall take into account the following considerations: (i) the Company's financial situation and profitability; (ii) whether or not the Employee performed his duties hereunder to the Company's satisfaction and in accordance with his projections and reports to the Company, and those other considerations as may be appropriate in the circumstances. For the removal of doubt, for as long as the Employee is a member of the Company's Board of Directors, any change in the Employee's Yearly Gross Salary as aforesaid and any other changes to the terms of employment hereunder, shall require the approval of the Company's shareholders, all in accordance with the provisions of the Companies Law 5759-1999, as same may be amended from time to time.


(b) The Employee shall receive the Monthly Gross Salary payable in respect to periods of Employee's military reserve duty. The Company shall be entitled to receive and to retain any amounts payable by the National Insurance Institute or any other agency or entity in respect of such periods.


(c) (I) The Company and Employee will obtain and maintain Managers Insurance ("BITUACH MENAHALIM") for the exclusive benefit of Employee and in customary form, with respect to which the Company shall be the owner. The Company shall contribute an amount equal to thirteen and one-third percent (13.333%) of each Monthly Gross Salary payment (out of which 8.33% are designated for severance payments and 5% are designated for premium payments) (the "COMPANY CONTRIBUTION") and the Employee shall contribute five percent (5%) of the Monthly Gross Salary payment (the "EMPLOYEE'S CONTRIBUTION") toward the premiums payable in respect of such insurance, all amounts in the aggregate not to exceed the Monthly


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Gross Salary of Employee (the "INSURANCE POLICY"). The Employee hereby instructs the Company to make the necessary transfers to the insurance company of the amounts representing the Employee's and the Company's Contributions on account of the Insurance Policy.


(II) It is hereby agreed that, should the Employee be or become entitled to severance pay under any applicable Israeli law, the amounts accrued in the Insurance Policy on account of that portion of the Company's Contribution which is designated for severance pay, [i.e., the 8.33%] (the "SEVERANCE PORTION") shall be in lieu thereof and in full and final substitution therefor.


Notwithstanding subsection (c)(II) above, if the Severance Portion accrued in the Insurance Policy is less than the amount of severance pay the Employee is or will be entitled to under applicable Israeli law, then the Company shall pay the Employee the difference thereof.


(III) It is hereby agreed that upon termination of employment under this Agreement, the Company shall release to the Employee all amounts accrued in the Insurance Policy on account of both the Company's and Employee's Contributions.


Notwithstanding subsection (c)(III) above, the Company will not be obligated to release to the Employee the Severance Portion of the Insurance Policy, or pay the Employee any other form of severance pay, under any one of the following circumstances:


(xx) Termination of employment by the Company for `cause' (as
defined in Section 3(c) above); and


(yy) Termination of employment for reasons which under Israeli law
would deprive the Employee of rights to severance pay.


(d) The Company and the Employee shall open and maintain a Keren Hishtalmut Fund (the "FUND") for the benefit of the Employee. The Company shall contribute to the Fund an amount equal to 7.5% of each Monthly Gross Salary payment and the Employee shall contribute to such Fund 2.5% of each Monthly Gross Salary payment. It is hereby clarified, that any tax liabilities that are due on account of the Company's contribution to the Fund shall be born solely by the Employee. The Employee hereby instructs Company to make the necessary transfers to the Fund of the amounts representing both the Employee's and the Company's contributions.


(d1) The Company shall obtain Disability Insurance ("Ovdan Kosher Avoda"), which may be included within the Insurance Policy, for the exclusive benefit of the Employee and shall contribute therefor an amount up to two and a half percent (2.5%) of each Monthly Gross Salary payment.


(e) Bonus. The Company's board of directors shall in its sole discretion, determine the amount of any bonus, the method of its computation, the periods for which any such bonus shall be paid and the performance targets required to be achieved by the


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Employee prior to receipt of any such bonus. When determining the amount of bonus to be paid hereunder, the Company's board or directors shall also consider factors such as the Company's financial condition and the Employee's achievement of any of the targets set by the Company's Board of Directors.


5. Vacation


(a) During the first year of employment hereunder, the Employee shall be entitled to fifteen (15) working days of paid vacation.


(b) Thereafter, during each year of employment hereunder, the Employee shall be entitled to an additional two (2) working days of paid vacation (i.e., in the second year of employment - 17 days, in the third year of employment - 19 days and so on), up to a maximum aggregate of twenty-one (21) working days of paid vacation for any given year of employment hereunder.


(c) Vacation time may be taken at times subject to the reasonable approval of the Company and may be accumulated for no more than thirty (30) days for a period of two (2) years after which time Employee shall forfeit any unused vacation remaining at the end of such two year period.


(d) Accumulated vacation time shall be paid according to the regular payroll practice in Company, only upon termination of the employment by Company.


5A. Company Car


The Company shall provide the Employee with an automobile for his exclusive use, of a make, model and size as determined by the Company in its sole discretion. Notwithstanding the foregoing, the car provided shall be a category 3 car. The Company shall pay all actual maintenance (including gasoline) and insurance expenses in connection with the automobile and its use by the Employee. For the removal of doubt, the Company shall only be required to provide said insurance in connection with the use of such automobile solely by the Employee. The Company shall bear the cost of the taxes payable in connection with the provision of such automobile and the use of same by the Employee. For the removal of doubt, the Company shall not be liable to pay any tickets in connection with any traffic violations, whether such tickets were issued by the police or by a municipality and the Employee hereby agrees to indemnify and hold harmless the Company, its officers, directors and employees (the "INDEMNIFIED PERSONS") from and against any claim and/or liability made and/or imposed upon such Indemnified Persons, arising from any such traffic violation and/or tickets related thereto, regardless of whether such violations and/or tickets are recorded or issued by the police of a municipality.


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6. Expenses


The Company shall reimburse the Employee for all ordinary and reasonably necessary business expenditures incurred directly in connection with or in furtherance of a specific task or services rendered to the Company by the Employee at the request of the Company (e.g., performance of activities outside of Israel), upon presentation of the appropriate invoices, receipts, vouchers or such other supporting information and documents as may be requested by the Company from time to time. Notwithstanding the foregoing, expenses exceeding USD$2,000 shall be subject to the prior written approval of the Company. Except as provided for in this Section 6 or unless otherwise agreed to in writing by the Company, the Company shall have no liability to reimburse the Employee for any expenses incurred by him in connection with this Agreement or the discharge of his regular or ordinary duties or services as an employee of the Company hereunder. Employee will be reimbursed as soon as practicable following the presentation to the Company of appropriate information and documentation evidencing such expenses, as provided in this Section 6.


7. Undertaking


Simultaneously with the execution of this Agreement, the Employee shall execute the undertaking attached hereto as EXHIBIT A, including any exhibits attached thereto, including but not limited to the deeds of transfer of shares and the escrow agreement.


8. Proprietary Rights and Information


Subject to the provisions of the License Agreement between Company and Ramot-University Authority for Applied Research and Industrial Development Ltd., dated as of same date (the "LICENSE AGREEMENT") with respect to proprietary rights in the Technology (as defined in the License Agreement:


(a) any and all patentable and unpatentable inventions, discoveries, ideas or applications conceived, originated or developed by Employee during the term of his employment under this Agreement or in connection therewith and directly relating to Company's business (which on the Effective Date relates to drug discovery to membrane embedded proteins and De Novo protein design), and as may be adjusted from time to time (the "COMPANY'S BUSINESS") shall be the sole and exclusive property of Company in every territory in which Company conducts its business, whether directly or indirectly. Without derogating from the foregoing, Employee hereby irrevocably transfers and assigns to the Company for no consideration any and all such present and future patentable and unpatentable inventions, discoveries, ideas or applications, including but not limited to any intellectual property related rights to or in the same, which were invented, discovered, thought of, produced, developed or applied during the term of employment hereunder. In addition, without derogating from any of the foregoing provisions, the Employee, at the request and sole expense of Company, shall execute such documents and perform such acts as the Company or its counsel may deem necessary or advisable to irrevocably confer upon the Company for no consideration all rights in and title and interest to such invention, discovery or idea, and all patent


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application, patents and copyrights thereon, and to enable and assist the Company in procuring, maintaining, enforcing and defending patents, copyrights and other applicable statutory protection on any such invention, discovery, idea or application which may be patentable or copyrightable.


(b) Employee shall promptly disclose to the Company in such form and manner as the Company may reasonably require all inventions, systems, services and other information or data directly relating to the Company's Business conceived, originated, discovered or developed by the Employee hereunder and during the term hereof. It is understood that such information is proprietary in nature and shall (as between the Company and the Employee) be for the exclusive use and benefit of the Company. In addition, the Employee shall keep the Company informed on a regular basis of the progress of the Employee's research and development efforts hereunder.


9. Secrecy and Nondisclosure


The Employee agrees to treat as secret and confidential all of the processes, methods, formulas, procedures, techniques, software, designs, data, drawings and other information which are not of public knowledge or record pertaining at any time to the Company's Business of which the Employee becomes aware. The Employee agrees not to disclose, use, publish, or in any other manner reveal, directly or indirectly, at any time during or after the term of this Agreement, without the prior written consent of the Company in each instance, any such processes, methods, formulas, procedures, techniques, software, designs, data, drawings and other information pertaining at any time to the Company's Business. The Company undertakes to establish a policy or general guidelines relating to the publication of scientific contributions by its employees which is intended to encourage such publication and, at the same time, provide for the Company with adequate protection of its intellectual property and proprietary rights. For the removal of doubt, the Employee shall, prior to releasing any scientific or like publication relating to the Company's proprietary information, present such proposed publication materials to the Company's Chief Executive Officer or any other person designated for such purpose by the Company's Chief Executive Officer for his/her approval for such publication. For the purposes of this Section 9, the Company's proprietary information shall include but not be limited to information, in any form, obtained by the Employee for and on behalf of the Company in the fulfillment of his duties hereunder.


10. Non-Competition


(a) Employee agrees that, during the term of this Agreement, including any extensions thereto and for a period of eighteen (18) months thereafter, he will not directly or indirectly, for his own account or as an employee, officer, director, partner, joint venturer, shareholder, investor, consultant or otherwise (except as an investor in a corporation whose stock is publicly traded and in which Employee holds less than five (5%) percent of the outstanding shares):


(i) in the following territories: Israel, U.S.A., Germany, Switzerland, the United Kingdom, France and Japan, interest himself in, be connected with or engage


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in any projects, which are competitive with the Company's Business in which the Company is engaged or is actively pursuing engagement, during the term of this Agreement or following termination, or is proposed in writing by Company prior to the time of termination of this Agreement, unless otherwise specifically permitted under this Agreement;


(ii) hire, engage or employ or solicit, contact or communicate with for the purposes of hiring, employing or engaging, any person who is then or was an employee and/or consultant of Company at any time within the twelve-month period immediately prior thereto.


(b) The restrictions in subsection 10(a) shall not apply to any activities that are disclosed by Employee in advance to the Company, and are consented to in writing by the Company.


(c) Notwithstanding anything contained in this Section 10 to the contrary, if the period of time or the geographical area specified under subsection 10(a) above should be determined to be unreasonable in any judicial proceeding, then the period of time and area of the restriction shall be reduced so that this Agreement may be enforced in such area during such period of time as shall be determined to be reasonable by such judicial proceeding.


11. Representations of Employee


Employee hereby represents and warrants to Company that:


(a) The execution and delivery of this Agreement and the fulfillment of the terms hereof (including any duties and obligations of or transactions executed by Employee hereunder) (i) do not and will not constitute a default under or conflict with any agreement or other instrument to which he is a party or by which he is bound, including but not limited under his agreement with the University of Tel Aviv, Israel, (ii) does not require the consent of any person or entity, or alternatively, that if it does not require the consent of any person or entity, that such consent has been obtained, in writing, prior to the execution of this Agreement, and (iii) do not and will not violate, interfere with or infringe upon, any rights of any other person or entity; and


(b) This Agreement constitutes the valid and binding obligation of Employee enforceable against him in accordance with its terms subject to applicable bankruptcy, insolvency, moratorium and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless if enforcement is sought in a proceeding in equity or at law).


(c) Employee acknowledges that his Position requires a special measure of personal trust, as defined in the Law of the Hours of Work, and Rest - 1951, and therefore, Employee shall not be entitled to any additional compensation for extra hours of work.


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12. Representations of Company


Company hereby represents and warrants to Employee that:


(a) The execution and delivery of this Agreement and the fulfillment of the terms hereof (i) will not constitute a default under or conflict with any agreement or other instrument to which Company is a party or by which it is bound, and (ii) does not require the consent of any person or entity; and


(b) This Agreement constitutes the valid and binding obligation of Company enforceable against it in accordance with its terms subject to applicable insolvency, moratorium and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless if enforcement is sought in a proceeding in equity or at law).


13. Miscellaneous


13.1 Waiver. Failure by either party to insist upon compliance with any of the terms, covenants, or conditions hereof shall not be deemed a waiver of such term, covenant, or condition, nor shall any waiver or relinquishment of any right or power hereunder at any one time or more times be deemed a waiver or relinquishment of such right or power at any other time or times.


13.2 Severability. The invalidity or non enforceability or any provision hereof shall in no way affect the validity or enforceability of any other provision. The parties to this Agreement agree and intend that this Agreement shall be enforced as fully as it may be enforced consistent with applicable statutes and rules of law.


13.3 Benefit. Except as otherwise herein expressly provided, this Agreement shall inure to the benefit of and be binding upon Company, its successors and assigns, including, without limitation, any company which may acquire all or substantially all of Company's assets or business or with or into which Company may be consolidated or merged, and to the benefit of, and be binding upon, Employee, his heirs, executors, administrators and legal representatives. Notwithstanding the foregoing, the obligations of Employee hereunder shall not be assignable or delegable.


13.4 Entire Agreement. This Agreement constitutes the entire understanding and agreement between the parties hereto, supersedes any and all prior discussions, agreements and correspondence with regard to the subject matter hereof, and may not be amended, modified or supplemented in any respect, except by a subsequent writing executed by both parties hereto. For the removal of doubt, if a conflict exists between the provisions of this Agreement relating to confidentiality and non-competition and any other agreement containing similar undertakings of the Employee, then the provisions of this Agreement shall prevail and supersede any such conflicting provisions.


13.5 Taxes. From all payments made by the Company hereunder, all applicable taxes will be deducted.


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13.6 Notices. Any notice or other communication required or permitted hereunder shall be in writing and shall be delivered personally of sent by facsimile or sent by certified, registered or express mail, postage prepaid. Any such notice shall be deemed given when so delivered personally or sent by facsimile transmission or, if mailed, five days after the date of deposit in the mail, as follows:


(i) if to Dr. Oren Becker
[ADDRESS]


(ii) if to Company:
12A Kibush Ha'voda Street
Hertzeliya, Israel
Attn: Dr. Silvia Noiman


Any party may, by notice given in accordance with this Section 13.6 to the other parties, designate another address or person for receipt of notices hereunder.


13.7 Applicable Law. This Agreement shall be governed by, construed and enforced in accordance with the laws of the State of Israel, without giving effect to principles of conflicts of law.


13.8 Jurisdiction. The parties agree that the District Courts located in Tel Aviv shall have jurisdiction to settle any disputes that may arise out of or in connection with this Agreement and that, accordingly, any suit, action or proceeding arising out of or in connection with this Agreement may be brought in such courts.


13.9 Counterparts. This Agreement may be executed in one or more counterparts but all such separate counterparts shall constitute but one and the same instrument; provided that, although executed in counterparts, the executed signature pages of each such counterparts may be a ...