Preview | Employment Agreement |

THIS EMPLOYMENT AGREEMENT (the Agreement) is made as of the 1st day of January, 1998 by and between METAMORPHIX, INC., a Delaware corporation (hereinafter referred to as the Employer) and EDWIN C. QUATTLEBAUM, PH.D., a Maryland resident (hereinafter referred to as the Employee).

A. Employer desires to employ Employee as its Executive Vice President of Agriculture, in accordance with the terms and conditions of this Agreement.

B. Employee desires to serve in the employ of the Employer on a full-time basis subject to the terms and conditions of this Agreement.

C. Contemporaneously with the execution and delivery of this Agreement, Employer and Employee have entered into an Incentive Stock Option Agreement (the Stock Option Agreement) and a Non-Disclosure and Confidentiality Agreement (the Confidentiality Agreement).

NOW, THEREFORE, in consideration of the mutual covenants, promises, agreements, representations, and warranties of Employer and Employee, each to the other made, the Explanatory Statement which shall be deemed a substantial part hereof, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Employer and Employee hereby covenant, promise, agree, represent, and warrant as follows:

1.1. Engagement of Employment. Employer hereby employs Employee, and Employee accepts such employment, on an at will basis, as Employers Executive Vice President of Agriculture, as of January 1, 1998, and Employee agrees to render such duties as are set forth in Section 1.2, subject to the terms and conditions of this Agreement.

1.2. Duties. During Employees employment under this Agreement, Employee shall render to the best of Employees ability, on behalf of Employer, on an exclusive basis, and at the direction of Employers Board of Directors, services as Employers Executive Vice President of Agriculture, and such other duties as the Board of Directors shall direct. In particular, subject to oversight and direction of the Board of Directors and the President, Employee shall:

(a) identify, develop, and direct Employers agricultural business opportunities for GDF-8 and other Growth in Differentiation Factors;

(b) working with Employers Scientific Founder, Scientific Advisory Board, Research Management Committee, and Chief Scientific Officer (or other officers), propose plans of research (and related timetables, strategies, business plans, and budgets) to Employers President and Board of Directors;

(d) develop and oversee policies and procedures of confidentiality and non-disclosure; and

(e) coordinate patent-filing efforts.

Employee shall not pursue other employment, consulting, or professional endeavors except his continued service upon the Board of Directors of Dominion BioScience and (until June 30, 1998) two days each month as a consultant for such company. To the extent approved by Employers Board of Directors in its sole discretion, Employee may serve from time-to-time upon additional Boards.

SECTION 2. COMPENSATION.

2.1. Annual Salary. Employer shall pay Employee (in addition to any benefits or bonuses provided for in this Agreement) an annual salary (the Annual Salary), payable in semi-monthly or other regular installments, and subject to customary payroll deductions in accordance with the general practice of Employer. The Annual Salary shall be Two Hundred Thousand Dollars ($200,000.00) per annum, subject to later adjustments as may be agreed upon between Employer and Employee.

2.2 Salary Review. Employer shall re-examine the Annual Salary after: (a) the anticipated GDF-8 Agricultural Opportunity transgenic animal-focused Research and Development contracts (in swine and chicken) and a GDF-8 Inhibitor Partnership have been established; (b) Employer has received at least Ten Million Dollars ($10,000,000) in aggregate up-front payments from strategic partnering and licensing agreements and/or from equity investments in Employer; and (c) Employer has hired a full-time Chief Executive Officer. Upon any adjustment, the Bonus Compensation provisions may be eliminated or modified.

2.3. Bonus Compensation. In addition to the Annual Salary provided for by Section 2.1, subject to customary payroll deductions in accordance with the general practice of Employer, Employer shall pay Employee additional compensation in the form of an annual bonus (the Annual Performance-Based Bonus) as follows:

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