Vice President of Business Development Employment Agreement

Exhibit 10.3

AMENDED AND RESTATED

EXECUTIVE EMPLOYMENT AGREEMENT


This Amended and Restated Executive Employment Agreement (" Amended Agreement" ), made and entered into as of this 12th day of May, 2007 (" Effective Date" ) , constitutes a voluntary and negotiated modification of the September 14, 2006 Executive Employment Agreement by and between MonoSol RX, LLC (the " Company" ) and Joseph M. Fuisz, Esq., an individual (the " Executive" ) (the " September 14th Agreement" ).

WITNESSETH:

WHEREAS , the Company desires to continue to employ the Executive as its Senior Vice President of Business Development and Licensing, and Executive is willing to accept such employment by the Company, on the terms and subject to the conditions set forth in this Amended Agreement;

WHEREAS , the September 14th Agreement replaced and superseded the prior consulting agreement between the Company and the Executive;

WHEREAS , the September 14th Agreement shall be replaced and superseded by this Amended Agreement as of the Effective Date;

WHEREAS , the parties agree that this Amended Agreement constitutes a written instrument signed by them, as required by Section 13 hereof, which is sufficient to effectuate the modifications set forth herein; and

WHEREAS , the parties understand that the Company, through its successor by merger, Monosol Rx Inc., intends to file a registration statement with the Securities and Exchange Commission and to become a publicly held company pursuant to U.S. securities laws. This Amended Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their heirs, legatees, personal representatives, successors, and assigns. In the event of any merger of the Company with and into Monosol Rx Inc., all rights of the Company under this Amended Amendment shall survive such merger and shall become the rights of Monosol Rx Inc.

NOW, THEREFORE , in consideration of the promises and the mutual covenants herein set forth, and for other good and valuable consideration, the parties hereto, intending to be legally bound, hereby agree as follows:

1. Emplovment. During the term of this Amended Agreement, the Executive agrees to be employed by and to serve the Company as its Senior Vice President of Business Development and Licensing, and the Company agrees to employ and retain Executive in such capacity. The Executive shall report directly to the President and CEO (hereafter the " CEO" ). The Executive shall: (i) devote his entire business time, energy and skill to the affairs of the Company; (ii) faithfully, loyally, and industriously perform all duties incident to the position of Senior Vice President of Business Development and Licensing, as well as any other duties consistent with the stature and responsibility of the Executive' s position as may from time to time be assigned by the CEO of MonoSol RX, LLC; and (iii) diligently follow and implement all policies, practices, procedures, and rules of the Company. The Executive shall be based in Washington, D.C.


2. Emplovment Term . The employment term (the " Employment Term" ) of the Executive


under this Amended Agreement shall be for a period of eight (8) months, concluding December 31, 2007. The Employment Term shall commence on the Effective Date and shall not extend beyond December 31, 2007 for any reason.


Upon conclusion of the Employment Term, the Executive shall continue to provide services to the Company as an independent contractor pursuant to the Consulting Agreement attached hereto as Exhibit A, provided that the Executive' s employment is not otherwise terminated in 2007 pursuant to Section 5(A) or 5(D) hereof. In the event the Executive' s employment is terminated during the Employment Term pursuant to Section 5(A) or 5(D) hereof, the Consulting Agreement attached as Exhibit A shall immediately become null and void and shall have no further force or effect, even if signed by the parties, and the terms of this Agreement shall remain valid and enforceable. If, however, the Consulting Agreement commences on its effective date of January 1, 2008, the Consulting Agreement shall supersede this Amended Agreement, with the exception of Section 8 hereof which shall survive any termination of this Amended Agreement or the Executive' s employment or consultancy. The term of the Consulting Agreement shall be for a one (1) year period, from January 1, 2008 through December 31, 2008, provided the Consulting Agreement is not revoked, rescinded or otherwise terminated pursuant to the terms of that Agreement.


If, during the Employment Term, the Executive' s employment is terminated pursuant to Section 5(A) or 5(D) hereof, the Executive understands and agrees that such termination shall extinguish all of his rights to or interests in any Consulting Agreement with the Company, including those set forth in the Consulting Agreement attached hereto as Exhibit A. The Executive further understands and agrees that he shall not be entitled to any payments, compensation, or benefits other than those set forth in Section 6(A) or 6(D), whichever may be applicable.


If, during the Employment Term, the Executive' s employment is terminated for any reason other than those set forth in Section 5(A) or 5(D) hereof, the Executive shall remain eligible for the applicable payments and benefits set forth in Section 6 for the duration of the Employment Term, which ends on December 31, 2007. The Executive shall also remain eligible to return to the Company on January 1, 2008 to provide services as an independent contractor pursuant to the Consulting Agreement attached hereto as Exhibit A. The Executive understands that, under those circumstances, health care coverage following his termination of employment with the Company would be through COBRA, if elected by the Executive, and that the Company would reimburse the Executive for the COBRA premiums required to maintain the same level and type of health care coverage he had during his employment with MonoSol RX, LLC. The Executive understands and agrees that COBRA coverage is usually limited to a maximum of eighteen (18) months and that, therefore, his COBRA coverage may be exhausted prior to or shortly after completion of his one (1) year assignment as a consultant and that the Company shall have no further obligation once COBRA is exhausted. A termination of employment during the Employment Term for any reason other than those set forth in Section 5(A) or 5(D) hereof shall not effect the vesting schedule of Executive' s Performance Units pursuant to the Performance Unit Plan. The Company agrees that a such a break in service shall be bridged for purposes of the Executive' s Performance Units. This bridging will not occur if the termination is pursuant to Section 5(A) or 5(D) hereof.


3. Compensation .

A. Base Salary . As compensation for services rendered to the Company pursuant to this


2

Amended Agreement, the Company shall pay to Executive a base salary (the " Base Salary" ) at a rate of $280,000.00 per annum, payable at a rate of $23,333.33 per month. The Base Salary will be paid in accordance with the standard payroll policies of the Company as from time to time are in effect, from which shall be deducted federal and, if applicable, state income taxes, social security taxes, and such other and similar payroll taxes and charges as may be required or appropriate under applicable law. The Base Salary shall be considered by the CEO for increase based upon performance and other considerations as appropriately determined by the CEO, including without limitation performance assessment, market assessment for comparable executive and employment terms and awards as may be deemed appropriate from time to time.

B. Annual Bonus. In addition to the Base Salary, on December 31, 2007, Executive shall become eligible, if then employed with the Company, for a bonus (the " Annual Bonus" ) of fifty percent (50%) of Executive' s Base Salary, provided Company achieves established performance targets. Executive must be employed by the Company on the day any bonus payment is due and payable under this Amended Agreement in order to receive said bonus payment. The bonus shall be paid in cash and/or performance units (or other form of equity in the event of any merger of the Company with and into Monosol Rx Inc.), as determined by the Company. If the Company exceeds established performance targets, the Company may, in its sole discretion, increase the amount of the Annual Bonus.

4. Additional Benefits .

A. Executive Benefits. During the Employment Term, Executive shall receive such benefits and participate in such executive benefit plans as set forth in the MonoSol RX, LLC, Benefit Summary, attached hereto as Exhibit B and incorporated herein by reference.

B. Vacation: Sick Leave. The Executive shall, during the Employment Term, be allowed to take up to four (4) weeks of vacation (minus any vacation time already taken in 2007), and shall be eligible for such sick leave each year as shall be established by the Company for senior executives of the Company.

5. Termination.

A. Termination for Cause . Notwithstanding anything to the contrary contained in this Amended Agreement, Termination for Cause may be effected by the Company at any time during the term of this Amended Agreement by written notification to the Executive in accordance with Section 7(A) of this Amended Agreement. For purposes of this Amended Agreement, " Termination for Cause" shall mean:

(1) the willful and continued failure of such Executive to perform his duties,

including, without limitation, such Executive' s failure or refusal to follow the legitimate directions of the Company and/or of any of the persons to whom such Executive reports (other than any such failure resulting from his death or permanent disability); or

(2) the engaging by such Executive in willful, reckless or negligent conduct in

connection with his employment or other relationship which is materially detrimental to the Company; or,

(3) the conviction of such Executive of any felony or any crime involving


3

moral turpitude; or,


(4) such Executive' s reporting to work impaired by or under the influence of

alcohol or illegal drugs; or,

(5) such Executive' s engaging in the unlawful use (including being under the

influence) or possession of illegal drugs on the Company' s premises; or,

(6) such Executive' s engaging in sexual harassment or other violation of any

harassment or discrimination law; or,

(7) Executive' s commission of fraud in connection with Executive' s

employment or theft, misappropriation or embezzlement of the Company' s funds; or,

(8) the demonstrated use or disclosure by Executive of any confidential

proprietary or trade secret information of Executive' s former employer or that Executive learned or obtained through his former employer; or,

(9) the demonstrated use or disclosure by the Executive of any confidential

information of the Company except when such disclosure is made pursuant to the directions of the Company or in accordance with Company policy; or,

(10) such Executive' s engaging in competitive behavior against the Company, purposely aiding a competitor of the Company, or misappropriating or aiding in misappropriating a material opportunity of the Company.

All determinations of " Cause" shall be made by the Board of Managers of the Company (the " Board" ). If the Company elects to terminate Executive' s employment for Cause pursuant to clause (1) of the definition of " Cause" and the action or inaction prompting such termination is capable of cure, the Company shall first give Executive written notice thereof, including a description of the evidence upon which the Board has relied to support such finding and a period of thirty (30) days (the " Cause Notice Period" ) from the date of such notice to cure the action or inaction giving rise to the written notice. If such action or inaction is not cured by Executive by the end of the Cause Notice Period, as determined by the Board and communicated to the Executive in writing, such termination shall be effective upon the first day after the expiration of the Cause Notice Period.

B. Termination bv Reason of Disabilitv. In a manner consistent with the Americans with Disabilities Act and the Family and Medical Leave Act, this Amended Agreement may be terminated at the Company' s option immediately upon notice to Executive if Executive shall suffer a Permanent Disability. For purposes of this Amended Agreement, the term " Permanent Disability" shall mean the Executive' s inability to perform the essential functions of his job under this Amended Agreement, with or without reasonable accommodation, for a period of ninety (90) consecutive days or for an aggregate of one hundred twenty (120) days, whether or not consecutive, in any twelve (12) month period, due to illness, accident or other physical or mental incapacity, as determined by a board certified physician mutually agreed to by both the Executive and the Company.


C. Termination by Reason of Death. In the event of the Executive' s death, the Executive' s employment shall be deemed to have terminated on the date of Executive' s death.

D. Voluntary Resignation. Executive may terminate this Amended Agreement at any


4

time, subject to providing sixty (60) days' written notice to the Company in accordance with Section 7(B) of this Amended Agreement; provided, however, that Executive' s covenants and obligations under Section 8 herein shall survive Executive' s voluntary resignation.

E. Involuntary Termination. Notwithstanding anything to the contrary contained in this Amended Agreement, involuntary termination may be effected by the Company by giving written notification to the Executive in accordance with Section 7(A) of this Amended Agreement. For purposes of this Amended Agreement, the term " Involuntary Termination" shall mean termination by the Company of the Executive' s employment with the Company other than: (i) Termination for Cause; (ii) Termination by Reason of Disability; or (iii) Termination by Reason of Death.

F. Termination for Good Reason . The Executive may terminate this Amended Agreement for " Good Reason" at any time during the term of this Amended Agreement by providing written notification to the Company in accordance with Section 7(B) of this Amended Agreement. For purposes of this Amended Agreement, " Good Reason" shall mean (l) any action by the Company which results in a substantial diminution in Executive' s position, authority, duties or responsibilities (including status, offices, titles and reporting requirements contemplated by this Amended Agreement), or (2) material breach by the Company of its obligations under this Amended Agreement.

6. Obligations of the Company Upon Termination .

A. Termination for Cause. In the event that the Executive' s employment under this Amended Agreement is terminated for Cause, the Company shall have no obligation to pay the salary or any other compensation provided under this Amended Agreement, to or for the benefit of the Executive for any period after the date of such termination, or to pay any bonus for the fiscal year in which such termination occurs; provided, however, that the Company shall promptly pay: (i) all Base Salary earned by the Executive prior to the date of such termination; and (ii) any benefits under any plans of the Company in which the Executive is a participant, to the full extent of the Executive' s rights under such plan.

B. Termination by Reason of Disability. In the event that the Executive' s employment under this Amended Agreement is terminated by Reason of Disability, the Company shall have no obligation to pay the Base Salary provided under this Amended Agreement to or for the benefit of the Executive for any period after the date of such termination; provided, however, that the Company shall promptly pay: (i) all Base Salary earned by the Executive prior to the date of such termination; (ii) any benefits under any plans of the Company in which the Executive is a participant, to the full extent of the Executive' s rights under such plan; (iii) a cash payment equal to the Annual Bonus received by the Executive for the previous year, pro-rated for the number of days employed during the year of termination up to the date of termination; and (iv) accrued, unused vacation pay.


C. Termination by Reason of Death . If the employment of the Executive hereunder shall terminate because of death of the Executive, the Company shall have no obligation to pay the Base Salary provided under this Amended Agreement to or for the benefit of the Executive for any period after the date of such termination; provided, however, that the Company shall promptly pay: (i) all Base Salary earned by the Executive prior to the date of such termination; (ii) any benefits under any plans of the Company in which the Executive was a participant to the full extent of the Executive' s rights under such plans; (iii) accrued, unused vacation pay; and (iv) a cash payment equal to the Annual Bonus received by the Executive for the previous year, proadrated for the


5


number of days employed during the year of termination up to the date of termination.

D. Voluntary Resignation. In the event that the Executive voluntarily resigns from his employment with the Company, the Company may, at its discretion, continue the Executive' s employment with the Company for the full amount of the notice period. In the event of said termination, the Company shall have no obligation to pay the Base Salary provided under this Amended Agreement to or for the benefit of the Executive for any period after the end of said notice period; provided, however, that the Company shall promptly pay: (i) all salary earned by the Executive prior to the date of such termination as well as Base Salary for the notice period; and (ii) any benefits under any plans of the Company in which Executive is a participant, to the full extent of the Executive' s rights under such plans (with the exception of any bonus and/or incentive compensation).

E. Involuntary Termination or Termination for Good Reason . In the event that the Executive' s employment under this Amended Agreement is involuntarily terminated as defined in Section 5(E) of this Amended Agreement, the Company shall: (i) continue to pay the Executive the Base Salary for the remainder of the Employment Term (the " Severance Period" ), at such intervals as the same would have been paid had the Executive remained in the active service of the Company; and (ii) pay any benefits under any plans of the Company in which the Executive is a participant, to the full extent of the Executive' s rights under such plans for the remainder of the Severance Period. If, during the Severance Period, the Executive materially breaches his obligations under Section 8 of this Amended Agreement, the Company may, upon written notice to the Executive, terminate the Severance Period and cease to make any further payments to Executive.

7. Notice of Termination .

A. The Company may effect a termination of this Amended Agreement pursuant to the provisions of Section 5 of this Amended Agreement upon giving thirty (30) days' written notice to the Executive of such termination; provided, however, that a Termination for Cause under Section 5(A) shall take effect immediately, at the option of the CEO.

B. The Executive may effect a termination of this Amended Agreement pursuant to the provisions of Section 5(D) of this Amended Agreement upon giving sixty (60) days' written notice to the Company.

8. Covenants of the Executive .

In order to induce the Company to enter into this Amended Agreement and employ the Executive hereunder, the Executive hereby covenants and agrees as follows. For all purposes under this Section 8 herein, the Company' s " business" shall mean film based delivery systems to deliver drug actives, nutraceuticals, cosmaceuticals or flavors, and soluble film based packaging systems.

A. Non-Competition. During the Employment Term, Executive shall not, without the prior written consent of Company, which consent may be withheld at the sole discretion of Company, engage in or in any manner be connected or concerned, directly or indirectly, whether as an officer, director, stockholder, partner, owner, employee, advisor, creditor, or otherwise, with the operation, management, or conduct of any business that competes with Company. Executive shall not in any manner disrupt or attempt to disrupt any relationships which Company may have with any of its


6

employees, suppliers, customers, lessors, banks, consultants, or other persons or entities with whom business dealings or ongoing relationships exist, nor induce any such parties to terminate or otherwise alter the manner in which such relationships are being conducted with Company.

B. Confidentiality . During the Employment Term, and following the termination of this Amended Agreement for any reason for as long as the information remains confidential, Executive shall not make any use, for his own benefit or for the benefit of a business or entity other than Company, of any verbal or written secret or confidential information. Such confidential information shall include, but not be limited to, customer lists, trade secrets, sales, marketing or consignment information, vendor lists or operational resource information, forms, processes or procedures, budget and financial statements or information, files, records, documents, compilation of data, engineering drawings, computer print-outs, or any other data of or pertaining to Company, its business, customers and financial affairs, or its services not generally known within Company' s trade and which was acquired by him during his affiliation with Company. Executive shall not remove from Company premises or retain without the Company' s written consent any of Company' s confidential information as defined herein, or copies of or extracts therefrom. Executive shall hold in a fiduciary capacity for the benefit of Company all secret or confidential information, knowledge, or data of Company or its business or production operations obtained by Executive during his employment by Company, which shall not be generally known to the public or recognized as standard practice (whether or not developed by Executive) and shall not, during his employment hereunder or after the termination of such employment, communicate or divulge any such information, knowledge or data to any person, firm or corporation other than Company or persons, firms or corporations designated by Company. Executive acknowledges that this information is treated as confidential by Company, that Company takes meaningful steps to protect the confidentiality of this information, and that Company has at all times directed Executive to maintain the confidentiality of this information. Immediately upon termination of this Amended Agreement, Executive shall return all of Company' s property to it, including any and all copies of said property.

C. Ownership of Work Product. Executive agrees that Company shall own all intellectual property including trade secrets, patents, patentable inventions, discoveries and improvements that relate to Company' s business that Executive conceives, develops during the Employment Term or delivers to the Company while performing services pursuant to this Amended Agreement (" Work Product" ). Executive further agrees to deliver to the Company, and that the Company shall thereafter own for all purposes, all Work Product conceived or developed by the Executive relating to the business of the Company which does not otherwise belong to Employee' s former employer or to which the former employer has no legal right or claim. Executive hereby irrevocably extinguishes for the benefit of the Company and its assigns any moral right to the Work Product recognized by applicable law. All Work Product shall be considered a work made for hire by Executive and owned by Company. If any of the Work Product may not, by operation of law, be considered work made for hire by Executive for Company, or if ownership of all right, title and interest of the intellectual property rights therein shall not otherwise vest exclusively in the Company, Executive agrees to assign, and upon creation thereof automatically assign, without further consideration, the ownership of all trade secrets, copyrights, patentable inventions, and other intellectual property rights therein to Company, its successors and assigns. Company, its successors, and assigns, shall have the right to obtain and hold in its or their own name copyrights, patents, registrations and any other protection available in the foregoing. For purposes hereof, a " trade secret" shall mean any information, including, but not limited to, technical or nontechnical data, formulae, patterns, compilations, programs, devices, methods, techniques, drawings, processes, financial data, financial plans, product


7


plans or lists of actual or potential customers or suppliers that derive economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from their disclosure or use and are the subject of efforts that are reasonable under the circumstances to maintain their secrecy. Executive agrees to perform, upon the reasonable request of Company and at no cost to the Company (other than travel out of pocket costs where applicable), during or after the period(s) that this Amended Agreement remains in effect, such further acts as may be necessary or desirable to transfer, perfect and defend the Company' s ownership of Work Product, or to enforce the Company' s Work Product against third parties. When requested, Executive shall promptly and at no cost to the Company (other than travel out of pocket costs, where applicable): (a) execute, acknowledge and deliver any requested affidavits and documents of assignment and conveyance; (b) obtain and aid in the enforcement of copyright and, if applicable, patents with respect to the Work Product in any countries; (c) provide testimony in connection with any enforcement proceeding or any proceeding affecting the right, title or interest of Company in any Work Product; and (d) perform any other acts deemed necessary or desirable to carry out the purposes of this Amended Agreement.

D. Inventions . All discoveries, designs, improvements, ideas and inventions, whether patentable or not, relating to (or suggested by or resulting from) products, services, or other technology of Company or relating to (or suggested by or resulting from) methods or processes used or usable in connection with the business of Company that have been, or may be, conceived, developed or made by Executive during the Employment Term (hereinafter " Inventions" ), either solely or jointly with others, shall automatically become the sole property of Company. Executive shall immediately disclose to Company all such Inventions and shall, without additional compensation, execute all assignments and other documents deemed necessary by Company to perfect Company' s title thereto, or to the patents issued thereon, or to otherwise secure and protect Company' s property rights therein. These obligations shall continue beyond the termination of Executive' s employment with respect to Inventions conceived, developed or made by Executive during employment with Company. The Company acknowledges and agrees that the provisions of this paragraph shall not apply to any invention for which no equipment, supplies, facilities or trade secret (or proprietary) information of Company is used by Executive and which is developed entirely on Executive' s own time, unless (a) such invention related to the business of Company or to Company' s actual or demonstrably anticipated research or development; or (b) such invention results from any work performed by Executive for Company.

E. Intellectual Property Rights Agreement. The terms of the Company' s Intellectual Property Rights Agreement are hereby incorporated into this Amended Agreement and any subsequent Consulting Agreement. Executive agrees to voluntarily execute and deliver to the Company the Intellectual Property Rights Agreement as a condition of his continued employment and in exchange for the offer to continue to provide services to the Co ...