EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into as of November 8, 2004 (the "Effective
Date"), by and between BrainStorm Cell Therapeutics Ltd., a company incorporated
under the laws of the State of Israel and maintaining its principal place of
business at Petach Tikva, Israel (the "Company"), Golden Hand Resources Inc., a
company incorporated under the laws of the State of Washington and maintaining
its principal place of business at 00 Xxxxxx Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxx
00000 ("GDNH"), and Xx. Xxxxx Xxxx, Israeli I.D. number _________, residing at
___________ Tel-Aviv, Israel (the "Executive").
WHEREAS: The Company is engaged, inter alia, in the research, development,
manufacturing and marketing of adult stem cell therapeutics for
neurological diseases (the "Technology"); and
WHERAS: The Company is a wholly owned subsidiary of GDNH; and
WHERAS: The Company has entered into an agreement with GDNH whereby the
Company agreed to provide GDNH with certain management and
development services, including to provide Executive as President
and CEO of GDNH; and
WHEREAS: The Company desires to employ the Executive as the President and
Chief Executive Officer (the "CEO") of the Company and GDNH also
desires to engage the Executive's services as President and CEO of
GDNH; and
WHEREAS: the Executive represents that she has the requisite skill and
knowledge to serve as the President and CEO of the Company and GDNH
and she desires to engage in such employment, according to the terms
and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, the parties agree as follows:
1. Employment
a) The Company and GDNH agree to employ the Executive and the Executive
agrees to be employed by the Company and GDNH on the terms and
conditions set out in this Agreement.
b) The Executive shall be employed as the President and CEO of the
Company and of GDNH. The Executive shall perform the duties,
undertake the responsibilities and exercise the authority
customarily performed, undertaken and exercised by persons situated
in a similar capacities, subject to the direction of the Board of
Directors (the "Israel BOD") of the Company and of GDNH (the "US
BOD"), as applicable. The Executive shall report regularly to the US
BOD and the Israel BOD with respect to her activities, as
applicable.
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c) All provisions relating to the Company as Executive's employer,
shall apply, mutatis mutandis, to GDNH.GDNH shall undertake to
procure the appointment of the Executive as a Director in the US BOD
and the Israel BOD.
d) The Company agrees that the Executive may provide consulting
services and own equity in a limited number of other business
entities, to be agreed upon in writing between the Company and
Executive within the first month of the Executive's employment
hereunder, provided that such activities do not conflict with the
business and affairs of the Company and/or GDNH; or interfere with
her ability to perform her duties to the Company and GDNH. Subject
to the above, Executive shall devote her business time, energy and
best efforts to the business and affairs of the Company and GDNH.
e) The Executive's position, duties and responsibilities hereunder
shall be in the nature of management duties that demand a special
degree of personal loyalty and the terms of Executive's employment
hereunder shall not permit application to this Agreement of the Law
of Work Hours and Rest 5711 - 1951. Accordingly, the statutory
limitations of such law shall not apply to this Agreement. The
Executive shall not be entitled to additional compensation from the
Company for working additional hours or working on holidays or
Sabbaths, as required by the Company.
2. Base Salary
The Company agrees to pay to the Executive in consideration for the
Executive's obligations to Company and GDNH specified herein, beginning on
the Effective Date an initial gross salary of $8,000 per month (the "Base
Salary"). As of six (6) months subsequent to the Effective Date, the Base
Salary of the Executive shall be adjusted to $12,000 per month.
The Base Salary shall be payable monthly in arrears, in New Israeli
Shekels ("NIS") according to the representative rate of exchange on day of
payment, no later than the 10th day of each month.
3. Stock Options
GDNH hereby undertakes to grant the Executive an option (the "Option") in
accordance with the terms and conditions set forth on Appendix 1 attached
hereto, constituting an integral part hereof.
4. Bonuses
Executive shall be entitled to an annual bonus in connection with the
achievement of milestones and/or objectives as determined by the BOD. In
addition, within a 10-day period following the 12 months anniversary of
the Effective Date, Executive will receive an additional bonus determined
by the BOD of at least $50,000.
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5. Executive Benefits
The Executive shall be entitled to the following benefits:
(a) Sick Leave. The Executive shall be entitled to fully paid sick leave
pursuant to the Sick Pay Law 5736 - 1976.
(b) Vacation. The Executive shall be entitled to an annual vacation of
22 working days per year. Executive shall be entitled to accumulate
vacation days and/or redeem their value, at her sole discretion.
(c) Manager's Insurance. The Company shall obtain on behalf of the
Executive and in her name, a manager's insurance policy, a pension
fund or a combination thereof (the "Manager's Insurance Policy"), as
determined by the Executive. The Manager's Insurance Policy shall be
payable as follows: A sum equal to 8.33% of the Executive's Base
Salary shall be allocated to severance pay; a sum equal to 5% of the
Executive's Base Salary shall be allocated to pension fund payments,
provided that the Executive contributes an additional 5% of the
Executive's Base Salary; and a sum equal to 2.5% of the Executive's
Base Salary shall be allocated to disability pension payments.
Contribution of the Company to the Manager's Insurance Policy shall
be on account of the Company's severance pay obligations.
(d) Continuing Education Fund. The Company shall contribute a sum equal
to 7.5% of the Executive's gross salary toward a continuing
education fund (the "Continuing Education Fund"), provided that the
Executive contributes an additional 2.5% of the Executive's gross
salary to such Continuing Education Fund. Use of the funds in the
Continuing Education Fund shall be in accordance with its by-laws.
(e) Telephone Costs; Cellular Phone. The Company shall provide the
Executive, at the Company's sole cost and expense, a cellular phone
and shall reimburse the Executive on telephone expenses.
(f) Out of Pocket Expenses. The Company shall pay or reimburse the
Executive for expenses incurred on behalf of the Company during
business trips outside Israel in accordance with Company's
applicable policy (including business class airline tickets and
accomodation). Reimbursement of such expenses shall be made upon the
presentation by the Executive to the Company of itemized accounts or
receipts, satisfactory to the Company.
(g) Company car. The Company shall purchase or lease for the Executive
an executive car (of no less than 2L engine). All taxes with respect
to the purchase or lease of the executive car shall be borne by the
Company.
(h) Directors and Officers' (D&O) Liability Insurance. Upon signature of
this agreement, the Company shall obtain on behalf of the Executive
directors & officers liability insurance with coverage that is
sufficient to cover Executive's activities hereunder, and shall
provide the Executive with a written undertaking of the Company and
of GDNH to indemnify and release the Executive to the full extent
possible in accordance with the Israeli Companies Law 5759-1999 and
the applicable Law of the State of Washington, USA.
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The Company undertakes to maintain said insurance and pay all
premiums thereof during the term of the Agreement and for a period
of 5 years following expiration and/or termination of the Agreement
for any reason whatsoever.
6. Termination
(a) Either party may terminate this Agreement and the employee-employer
relationship between the Executive and the Company and/or GDNH at
any time without "Cause"(as defined below) upon ninety (90) days
(the "Notice Period") written notice to the other party specifying
the effective date of termination (the "Termination Date").
Notwithstanding the aforesaid, the Company and/or GDNH may terminate
Executive's employment for Cause (as defined herein below), in which
event the Notice Period shall be thirty (30) days from the Company's
written notice with respect to such termination; provided however,
that the Company and/or GDNH has specified the basis for the
termination in the written notice delivered to the Executive, and
has given the Executive at least 15 days of the Notice Period, to
cure such basis. . For the purposes hereof, "Cause" shall mean: (i)
conviction of Executive of any felony; (ii) embezzlement of funds of
the Company and/or GDNH by the Executive; or (iii) activity by
Executive constituting direct competition with the Company and/or
GDNH, other than as specified in Appendix 1 hereto.
During the Notice Period the Executive shall be entitled to
compensation pursuant to Section 2 and to all of the benefits set
forth in Section5.
(b) During the Notice Period, the Executive shall transfer her position
to her replacement in an orderly and complete manner and shall
return to the Company all documents, professional literature and
equipment belonging to the Company, which may be in her possession
at such time. Notwithstanding the foregoing, the Company and/or GDNH
may elect to immediately cease Executive's employment under this
Agreement, provided that the Company and/or GDNH continues to pay
the compensation pursuant to Section 2 and to all of the benefits
set forth in Section 5 for the duration of the Notice Period.
(c) In the event of termination by the Company without Cause and/or in
the event that Executive resigns as a result of Constructive
Discharge (as such term is defined in Section of Appendix 2 hereto),
as of the end of the Notice Period and during the following period
of six (6) months, the Executive shall be entitled to full payment
of her Base Salary as set forth in Section 2 (the "Termination
Pay").
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(d) At the end of the Notice Period, the Company shall automatically
transfer to the Executive ownership of her Manager's Insurance
Policy, including severance payments and Continuing Education Fund.
The Company and Executive agree and acknowledge that in the event
the Company transfers ownership of Executive's Manager's Insurance
Policy to the Executive, the severance portion thereof shall
constitute payment towards any severance pay the Company may be
required to pay to the Executive pursuant to the Severance Pay Law
5727-1963, as long as the Insurance Policy contains all payments due
by law.
7. Competitive Activity
During the term of this Agreement and for a period of twelve (12) months
from the Termination Date of this Agreement, the Executive will not
directly or indirectly:
(i) Carry on or hold an interest in any company, venture, entity or
other business (other than a minority interest in a publicly traded
company) which directly competes with the Technology;
(ii) Act as a consultant or executive or officer or in any managerial
capacity in a business directly competing with the Technology;
(iii) Solicit, canvass or approach or endeavor to solicit, canvass or
approach any person who, to her knowledge, was provided with
services by the Company or its subsidiaries at any time during the
twelve (12) months immediately prior to the Termination Date, for
the purpose of offering restricted services or products which
directly compete with the Technology; or
(iv) Employ, solicit or entice away or endeavor to solicit or entice away
from the Company or its subsidiaries any person employed by the
Company or its subsidiaries any time during the twelve (12) months
immediately prior to the Termination Date with a view to inducing
that person to leave such employment and to act for another employer
in the same or a similar capacity.
8. Ownership and Protection of Intellectual Property and Confidential
Information:
(a) All information, ideas, concepts, improvements, discoveries, and
inventions, whether patentable or not, which are conceived, made,
developed or acquired by Executive, individually or in conjunction
with others, during Executive's employment by Company, which
directly relate to the Company's business, Technology, products or
services and all writings or materials of any type embodying any of
such items, shall be the sole and exclusive property of Company.
(b) Executive acknowledges that the businesses of Company and its
affiliates are highly competitive and that their strategies,
methods, books, records, and documents, their technical information
concerning their Technology, products, equipment, services, and
processes, procurement procedures and pricing techniques, the names
of and other information (such as credit and financial data)
concerning their customers and business affiliates, all comprise
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confidential business information and trade secrets which are
valuable, special, and unique assets which Company uses in its
business to obtain a competitive advantage over its competitors (the
"Confidential Information"). Executive further acknowledges that
protection of such Confidential Information against unauthorized
disclosure and use is of critical importance to Company in
maintaining its competitive position. Executive hereby agrees that
Executive will not, at any time during or after her employment by
Company, make any unauthorized disclosure of any Confidential
Information of Company, or make any use thereof, except in the
carrying out of her employment responsibilities hereunder.
Confidential Information shall not include (i) information in the
public domain (but only if the same becomes part of the public
domain through a means other than a disclosure prohibited hereunder)
or (ii) information which was lawfully in the possession of the
Executive prior to the Executive's employment by Company. The above
notwithstanding, a disclosure shall not be unauthorized if (i) it is
required by law or by a court of competent jurisdiction or (ii) it
is in connection with any judicial or other legal proceeding in
which Executive's legal rights and obligations as an Executive under
this Agreement are at issue; provided, however, that Executive
shall, to the extent practicable and lawful in any such events, give
prior notice to Company of her intent to disclose any such
confidential business information in such context so as to allow
Company an opportunity (which Executive will not oppose) to obtain
such protective orders or similar relief with respect thereto as it
may deem appropriate.
(c) All written materials, records, and other documents made by, or
coming into the possession of, Executive during the period of
Executive's employment by Company which contain or disclose
Confidential Information of Company or its affiliates shall be and
remain the property of Company or its affiliates, as the case may
be. Upon termination of Executive's employment by Company, for any
reason, Executive promptly shall deliver the same, and all copies
thereof, to Company.
9. Notice
For the purpose of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to
have been duly given when personally delivered or sent by registered mail,
postage prepaid, addressed to the respective addresses set forth below or
last given by each party to the other, except that notice of change of
address shall be effective only upon receipt.
The initial addresses of the parties for purposes of this Agreement shall
be as set forth in the preamble hereto.
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10. Miscellaneous
(a) No provision of this Agreement may be modified, waived or discharged
unless such waiver, modification or discharge is agreed to in
writing and signed by the Executive and the Company. No waiver by
either party hereto at any time of any breach by the other party
hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a
waiver of similar or dissimilar provisions or conditions at the same
or at any prior or subsequent time.
(b) This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Israel and sole
jurisdiction shall be granted to the competent courts in Tel-Aviv.
(c) The provisions of this Agreement shall be deemed severable and the
invalidity or unenforceability of any provision shall not affect the
validity or enforceability of the other provisions hereof.
(d) This Agreement constitutes the entire agreement between the parties
hereto and supersedes all prior agreements, understandings and
arrangements, oral or written, between the parties hereto with
respect to the subject matter hereof. No agreement or
representations, oral or otherwise, express or implied, with respect
to the subject matter hereof have been made either party which are
not expressly set forth in this Agreement.
(e) This Agreement shall be binding upon and shall inure to the benefit
of the Company, its successors and assigns, and the Company shall
require such successor or assign to expressly assume and agree to
perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no such
succession or assignment had taken place. The term "successors and
assigns" as used herein shall mean a corporation or other entity
acquiring all or substantially all the assets and business of the
Company (including this Agreement) whether by operation of law or
otherwise.
(f) Neither this Agreement nor any right or interest hereunder shall be
assignable or transferable by the Executive, his beneficiaries or
legal representatives, except by will or by the laws of descent and
distribution. This Agreement shall inure to the benefit of and be
enforceable by the Executive's legal personal representative.
(g) The provisions of Section 7 of this Agreement shall survive the
rescission or termination, for any reason, of this Agreement, and
shall survive the termination of the Executive's employment with the
Company.
(h) The section headings contained herein are for reference purposes
only and shall not in any way affect the meaning or interpretation
of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
BrainStorm Cell Therapeutics Ltd. Xxxxx Xxxx
/s/ Xxxxx Xxxxxxx /s/ Xxxxx Xxxx
--------------------- ------------------
By: Xxxxx Xxxxxxx
Title: Director
/s/ Xxxx Xxxxx
----------------------------
Golden Hand Resources, Inc.
By: Xxxx Xxxxx
Title: Director
Appendix 1
1. GDNH hereby undertakes to grant the Executive an option (the "Option") to
purchase 1,828,692 Shares of Common Stock of GDNH (the "Option Shares")
representing four percent (4%) of the issued and outstanding share capital
of GDNH on the Effective Date, on a fully diluted and as converted basis.
The Option shall vest and become exercisable in thirty six equal monthly
installments from the Effective Date (as defined in the Agreement) and
shall be exercisable by the Executive at any time during a period of ten
(10) years from the Effective Date (the "Option Expiration Date"), but in
any case not later than four (4) years after termination of the Agreement.
2. GDNH also undertakes that two (2) years from the Effective Date (the
"Additional Option Date"), it will grant the Executive an option (the
"Additional Option") to purchase such number of Shares of Common Stock of
GDNH (the "Additional Option Shares") representing two percent (2%) of the
issued and outstanding share capital of GDNH as of the Additional Option
Date, on a fully diluted and as converted basis.The Additional Option
shall vest and become exercisable in thirty six equal monthly installments
commencing as of the Additional Option Date and shall be exercisable by
the Executive at any time during a period of ten (10) years from the
Additional Option Date (the "Additional Expiration Date"), but in any case
not later than four (4) years after termination of the Agreement.
3. The Option and the Additional Option (collectively the "Options") shall be
granted to Executive pursuant to GDNH Share Option Plan (SOP). The SOP
will be made and approved in accordance with Section 102 of the Israeli
Tax Ordinance, as amended ("Section 102"), and shall be classified as
Section 102 Capital Gains Options.
4. The exercise price per each share underlying the Options shall be equal to
$0.15. The exercise of all or part of the Options shall be effected at
Executive's discretion.
5. GDNH hereby agrees to register the shares underling the Options on a Form
S-8 Registration Statement; however, GDNH's obligation to register the
shares shall not take effect until the one year anniversary of the grant
of the option agreement.
6. In the event that the Company terminates Executive's employment without
Cause (as defined in the Agreement) or in the event that Executive resigns
as a result of Constructive Discharge (as defined below) or in the event
of termination of Executive's employment by reason of Disability (as
defined hereinbelow) or death of the Executive, all of the remaining
unvested Options shall vest immediately as of the date of the notice of
termination, and Executive or her legal representative, estate or other
person to whom her rights are transferred by will or by laws of descent or
distribution, shall be entitled to exercise the vested Options from said
date until the earlier of (i) the lapse of four (4) years thereafter, or
until the Option Expiration Date or Additional Expiration Date, as
applicable. Notwithstanding the above, in the event of termination of
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Executive's employment by reason of Disability or death of the Executive
within two (2)years of the Effective Date, only 67% of the remaining
unvested Options shall vest immediately as of the date of the notice of
termination and the Executive or her legal representative, estate or other
person to whom her rights are transferred by will or by laws of descent or
distribution, shall be entitled to exercise the vested Options as above.
The term "Constructive Discharge" shall mean (i) material reduction in
Executive's compensation; (ii) material reduction in the level, scope of
job responsibility or status or material change in the position of
Executive occurring without the consent of Executive; (iii) relocation to
an office of the Company which is more than sixty (60) kilometers from the
office where Executive was previously located to which Executive has not
agreed; or (iv) voluntary termination by Executive as a result of an M&A
Transaction or within 6 months thereafter. For the purposes hereof, "M&A
Transaction" shall mean a merger, consolidation, corporate reorganization,
or any transaction in which all or substantially all of the assets or
shares of GDNH and/or the Company are sold, leased or transferred to
another company or otherwise disposed of; and the term "Disability" shall
mean a physical or mental infirmity which impairs Executive's ability to
substantially perform her duties under the Agreement and which continues
for a period of at least 90 (ninety) consecutive days.
7. In the event that the Company terminates Executive's employment for Cause
(as defined in the Agreement), Executive shall be entitled to exercise the
Options vested as of the date of the notice of termination until the lapse
of twelve (12) months thereof, and all Options which are not yet vested on
the date of such termination shall immediately expire.
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