EMPLOYMENT AGREEMENT
Exhibit 10.19
EXECUTION COPY
THIS EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”) dated as of January 7, 2008 (the
“Effective Date”), is by and between Isolagen, Inc., a Delaware corporation (together with its
subsidiaries, the “Company” or “Isolagen”), and Xxxxxx Xxxx, an individual residing in Ireland (the
“Executive”).
WITNESSETH:
WHEREAS, the Executive has served the Company as Executive Vice President — Europe and Chief
Financial Officer since June 5, 2006 pursuant to an employment agreement with the Company dated
March 2007 (the “2007 Employment Agreement”) and the Executive has served the Company as Chief
Operating Officer since June 27, 2007; and
WHEREAS, the Company now desires to employ the Executive as the Company’s Chief Executive
Officer; and
WHEREAS, the Executive desires to serve as the Chief Executive Officer; and
WHEREAS, the Company and the Executive desire that the 2007 Employment Agreement be terminated
and superseded and that Executive resign as Chief Operating Officer effective as of the Effective
Date; and
NOW THEREFORE, in consideration of the mutual benefits to be derived from this Agreement, and
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the Company and the Executive hereby agree as follows:
| 1. | Term of Employment; Office and Duties. |
(a) Commencing on the Effective Date (the “Employment Date”), and for an initial term ending
on December 31, 2010 (the “Initial Term”), the Company shall employ the Executive as a senior
executive of the Company with the title of Chief Executive Officer. As Chief Executive Officer
Executive shall perform all duties and responsibilities which are consistent with the positions and
such additional duties and responsibilities consistent with such positions as may from time to time
be assigned to the Executive by the Board of Directors. Executive agrees to perform such duties
and discharge such responsibilities in accordance with the terms of this Agreement. Executive also
agrees to continue to serve the Company as Chief Financial Officer until such time as the Company
selects, in consultation with Executive, a qualified individual to assume that position. This
Agreement shall be automatically renewed for an additional one (1) year term (the “Renewal Period”)
unless the Company notifies the Executive one hundred eighty (180) days prior to the expiration of
the Agreement of the Company’s intention not to renew the Agreement. The Initial Term and any
Renewal Period that has commenced shall be collectively referred to herein as the “Term” in effect
as of the relevant time. The Executive will continue to work out of Ireland; provided that it is
part of the essence of this Agreement from the perspective of the Company that the Executive will
physically be on the premises of the Company’s facility in Exton, Pennsylvania and in the United
States when and as appropriate and reasonable to effectively discharge his duties and responsibilities under
this Agreement.
(b) The Executive shall devote substantially all of his working time to the business and
affairs of the Company other than during vacations of four weeks per year and periods of illness or
incapacity; provided, however, that nothing in this Agreement shall preclude the Executive from
devoting time required: (i) for serving as a director or officer of any organization or entity not
in a competing business with the Company, and any other businesses in which the Company becomes
involved; (ii) delivering lectures, writing articles or books, or fulfilling speaking engagements;
or (iii) engaging in charitable and community activities provided that such activities do not
interfere with the performance of his duties hereunder.
(c) The Board of Directors shall nominate Executive to serve on the Board of Directors during
the Term of this Agreement, and shall first nominate Executive to serve on the Board of Directors
at the first meeting of the Board of Directors following the Company’s filing of its Form 10-K with
respect to the year ending December 31, 2007.
| 2. | Compensation and Benefits. |
For all services rendered by the Executive in any capacity during the period of Executive’s
employment by the Company, including without limitation, services as an executive officer or member
of any committee of the Board of Directors or any subsidiary, affiliate or division thereof, from
and after the Effective Date, the Executive shall be compensated as follows:
(a) Base Salary. The Company shall pay the Executive a fixed salary (“Base Salary”) at
a rate of Four Hundred Thirty Thousand United States Dollars (US $430,000) per year. The Board of
Directors may periodically review the Executive’s Base Salary and may determine to increase (but
not decrease) the Executive’s salary, in accordance with such policies as the Company may hereafter
adopt from time to time, if it deems appropriate. Base Salary will be payable in accordance with
the customary payroll practices of the Company.
(b) Signing Bonus. Executive shall be entitled to a one-time bonus in the amount of
Twenty-Five Thousand United States Dollars (US $25,000), payable to Executive within thirty (30)
days of the Employment Date.
(c) Bonus. Executive is entitled to receive an annual bonus (the “Annual Bonus”),
payable each year subsequent to the issuance of final audited financial statements, but in no case
later than 120 days after the end of the Company’s most recently completed fiscal year. The final
determination on the amount of the Annual Bonus will be made by the Compensation Committee of the
Board of Directors, based primarily on mutually agreed upon criteria, established with respect to
the ensuing fiscal year, within thirty (30) days following the adoption by the Board of Directors
of a budget relating to the ensuing year. Criteria for the Annual Bonus for 2008 shall be agreed
upon prior to or within sixty (60) days after the execution of this Agreement. The Compensation
Committee may also consider other more subjective factors in making its determination. The
targeted amount of the Annual Bonus shall be fifty percent (50%) of the Executive’s base salary.
The actual Annual Bonus for any given period may be higher or
lower than fifty percent (50%). For any fiscal year in which Executive is employed for less
than the full year, Executive shall receive a bonus which is prorated based on the number of full
months in the year which are worked.
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(d) Fringe Benefits, Option Grants and Miscellaneous Employment Matters.
(i) The Executive shall be entitled to participate in such disability, health and life
insurance and other fringe benefit plans or programs offered to all employees of the Company, as
well as to the key executive employees of Company, including a Section 401(k) and retirement plan
of the Company as may be established from time to time by the Board of Directors, subject to the
rules and regulations applicable thereto. At the Executive’s option, in lieu of providing group
medical benefits, the Company will reimburse the Executive for health insurance premium payments
made pursuant to a private supplemental health insurance policy in Ireland by the Executive
(currently approximately US $500 per month). Upon termination of Executive’s coverage under such
private supplemental health insurance policy, he shall have the option of enrolling in the
Company’s group plan or converting his prior coverage to an individual policy, at which time the
Company would reimburse him for an amount equal to its monthly cost of covering Executive under its
plan, and Executive would pay any additional amounts necessary to provide individual coverage. In
addition, the Executive shall be entitled to the following benefits:
(ii) Contemporaneous with the execution of this Employment Agreement, Executive received a
grant (the “Stock Option Grant”) of stock options (the “Stock Options”) to purchase 350,000 shares
at an exercise price equal to the closing transaction price of the Company’s Common Stock on the
last trading day preceding execution of this Employment Agreement. The Stock Options shall have a
term of ten (10) years, shall become exercisable when vested, and shall vest pro rata in twelve
equal quarterly installments (1/12th each at the end of each fiscal quarter), with the first
installment vesting on March 31, 2008. Notwithstanding the foregoing, the Stock Options shall
terminate ninety (90) days following a termination of the Executive for “Cause” or upon the
voluntary termination of service by the Executive that is not for “Good Reason.” However, if
Executive’s employment with the Company is terminated (i) without “Cause” or (ii) “For Good
Reason”, all unvested portions of the Stock Option Grant shall vest immediately upon such
termination.
(iii) Contemporaneous with the execution of this Employment Agreement, the Executive received
a grant (the “Performance Stock Option Grant”) of stock options to purchase 100,000 shares at an
exercise price equal to the closing transaction price of the Company’s Common Stock on the last
trading day preceding execution of this Employment Agreement. The Performance Stock Option Grant
shall have a term of ten (10) years, shall become exercisable when vested, shall terminate ninety
(90) days following a termination of the Executive for “Cause” or upon the voluntary termination of
service by the Executive that is not for “Good Reason.” Fifty percent (50%) of the Performance
Stock Option Grant shall vest, and no longer be subject to forfeiture, upon the Company’s accepted
filing of a Biologics License Application by the U.S. Food and Drug Administration (the “FDA”) and
the remaining fifty percent (50%) of the Performance Stock Option Grant shall vest, and no longer
be subject to forfeiture, upon the FDA’s approval of the Company’s Biologics License Application
filing; provided in each case that Executive is the Company’s Chief Executive Officer at the time of
said event.
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(iv) The vesting of the Stock Options and the Performance Stock Option Grant shall accelerate
and vest immediately upon a change in control of the Company as defined in Rule 405 of the
Securities Act of 1933 or upon sale of substantially all of the assets of the Company or the merger
out of existence of the Company.
(e) Withholding and Employment Tax. Payment of all compensation hereunder shall be
subject to customary withholding tax and other employment taxes as may be required with respect to
compensation paid by an employer/corporation to an employee.
(f) Disability. The Company shall provide the Executive with a policy of disability
insurance benefits of at least sixty percent (60%) of his gross Base Salary per month. To the
extent permitted by the Company’s existing disability policy, the Executive’s disability policy
will be a portable policy. The Executive agrees to pay for any additional premium payments
resulting from providing a portable policy (in comparison to a group policy) and further agrees to
have the additional premium payments deducted from his pay. In the event of the Executive’s
Disability (as hereinafter defined), the Executive and his family shall continue to be covered by
all of the Company’s life, medical, health and dental plans, at the Company’s expense, to the
extent such benefits can be obtained at a reasonable cost, for the lesser of the term of such
Disability (as hereinafter defined) or eighteen (18) months, in accordance with the terms of such
plans.
(g) Death. The Company shall provide the Executive with a policy of term life
insurance benefits in the amount of at least One Million United States Dollars (US $1,000,000). To
the extent permitted by the Company’s existing life insurance policy, the Executive’s life
insurance policy will be a portable policy. The Executive agrees to pay for any additional premium
payments resulting from providing a portable policy (in comparison to a group policy) and further
agrees to have the additional premium payments deducted from his pay. In the event of the
Executive’s death, the Executive’s family shall continue to be covered by all of the Company’s
medical, health and dental plans, at the Company’s expense, to the extent such benefits can be
obtained at a reasonable cost, for eighteen (18) months following the Executive’s death in
accordance with the terms of such plans.
(h) Vacation. Executive shall receive four (4) weeks of vacation annually,
administered in accordance with the Company’s existing vacation policy.
| 3. | Business Expenses. |
The Company shall pay or reimburse all reasonable travel and entertainment expenses incurred
by the Executive in connection with the performance of his duties under this Agreement, including
travel to the Company’s various offices and facilities in the United States and abroad,
reimbursement for attending out-of-town meetings of the Board of Directors, and such other travel
as may be required or appropriate in Executive’s discretion, consistent with duly approved Company
budgets, to fulfill the responsibilities of his office, all in accordance with such policies and
procedures as the Company may from time to time establish for senior officers and as
required to preserve any deductions for federal income taxation purposes to which the Company
may be entitled and subject to the Company’s normal requirements with respect to reporting and
documentation of such expenses. The Company shall also pay or reimburse Executive for all
membership fees and dues in appropriate professional associations and organizations utilized by
Executive in the course of his service for the Company, as well as all expenses incurred by the
Executive for Executive’s cellular telephone and portable text messaging including monthly service
charges, equipment maintenance and all other ancillary charges including, but not limited to, text
messaging, paging, and wireless communications.
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| 4. | Termination of Employment. |
Notwithstanding any other provision of this Agreement, Executive’s employment with the Company
may be terminated upon written notice to the other party as follows:
(a) By the Company, in the event of the Executive’s death or Disability (as hereinafter
defined) or for Cause (as hereinafter defined). For purposes of this Agreement, “Cause” shall mean
either: (i) the indictment of, or the bringing of formal charges against Executive on charges
involving criminal fraud or embezzlement; (ii) the conviction of Executive of a crime involving an
act or acts of dishonesty, fraud or moral turpitude by the Executive, which act or acts constitute
a felony; (iii) Executive negligently or knowingly having caused the Company to violate the
Company’s Bylaws; (iv) Executive having committed acts or omissions constituting gross negligence
or willful misconduct with respect to the Company, including with respect to any valid contract to
which the Company is a party; (v) Executive having committed acts or omissions constituting a
breach of Executive’s duty of loyalty or fiduciary duty to the Company or any material act of
dishonesty or fraud with respect to the Company which are not cured or substantially cured to the
satisfaction of the Board of Directors of the Company in a reasonable time, which time shall be at
least 30 days from receipt of written notice from the Company of such material breach; (vi)
Executive’s failure to relocate his residence to a location in the United States within a
reasonable proximity of the Company’s headquarters within one hundred and eighty (180) days
following a written determination of the Board of Directors of the Company that Executive is unable
to effectively discharge his duties and responsibilities under this Agreement without Executive
relocating his residence to the United States within a reasonable proximity of the Company’s
headquarters, provided, however, Executive shall provide the Board of Directors
with written notice of his decision to relocate his residence to the United States within thirty
(30) days of his receipt of such written determination and, in the event the Executive decides not
to relocate his residence, Executive shall continue to serve as Chief Executive Officer until the
one hundred and twentieth (120th) day following the Board of Directors’ written
determination as described above and his employment shall thereafter be terminated; or (vii)
Executive having committed acts or omissions constituting a material breach of this Agreement which
are not cured or substantially cured to the satisfaction of the Board of Directors of the Company
in a reasonable time, which time shall be at least 30 days from receipt of written notice from the
Company setting forth with specificity the particulars of any such material breach as well as the
corrective actions required. A determination that Cause exists as defined in clauses (iv), (v), or
(vii) (as to this Agreement) of the preceding sentence shall be made by at least a majority of the
members of the Board of Directors. For purposes of this Agreement, “Disability” shall mean the
inability of Executive, in the reasonable judgment of a physician jointly appointed by the
Executive and Board of Directors, to perform, even with reasonable accommodation,
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his duties of employment for the Company or any of its subsidiaries
because of any physical or mental disability or incapacity, where such disability shall exist for
an aggregate period of more than 120 days in any 365-day period or for any period of 90 consecutive
days. The Company shall by written notice to the Executive specify the event relied upon for
termination pursuant to this Section 4(a), and Executive’s employment hereunder shall be deemed
terminated as of the date of such notice. In the event of any termination under this Subsection
4(a), the Company shall pay all amounts then due to the Executive under Section 2 (a) of this
Agreement for any portion of the payroll period worked but for which payment had not yet been made
up to the date of termination, and, if such termination was for Cause, the Company shall have no
further obligations to Executive under this Agreement, and any and all options granted hereunder
shall terminate according to their terms; provided, however, that in the event of a termination for
Cause pursuant to clause (vi) above, the Company shall continue to pay to Executive the Base Salary
(at a monthly rate equal to the rate in effect immediately prior to such termination) for six (6)
months from the date of termination, when, as and if such payments would have been made in the
absence of Executive’s termination and any and all options granted hereunder shall terminate
according to their terms. In the event of a termination due to Executive’s Disability or death,
the Company shall comply with its obligations under Sections 2(f) and 2(g).
(b) By the Company, in the absence of Cause, for any reason and in its sole and absolute
discretion, provided that in such event the Company shall, as liquidated damages or severance pay,
or both, continue to pay to Executive the Base Salary (at a monthly rate equal to the rate in
effect immediately prior to such termination) for the longer of (x) the remaining Term or (y)
twelve (12) months from the date of termination (the “Termination Payments”), when, as and if such
payments would have been made in the absence of Executive’s termination. The Termination Payments
shall be made regardless of Executive’s subsequent re-employment as long as any new employment is
not in violation of Sections 5 or 6 of this Agreement.
(c) By the Executive for “Good Reason,” (as the Executive shall reasonably determine in good
faith) which shall be deemed to exist: (i) if the Company’s Board of Directors or that of any
successor entity of the Company fails to appoint or reappoint the Executive or removes the
Executive from the title and/or office of Chief Executive Officer of the Company or from any
successor entity operating the Company; (ii) if the Company’s Board of Directors or that of any
successor entity of the Company fails to appoint the Executive to serve on the Board of Directors
within thirty (30) days of the Employment Date or fails to renominate the Executive to serve on the
Board of Directors; (iii) if Executive is assigned any duties materially inconsistent with the
duties or responsibilities of the Chief Executive Officer of the Company as contemplated by this
Agreement or any other action by the Company that results in a material diminution in such
position, authority, duties, or responsibilities, excluding an isolated, insubstantial, and
inadvertent action not taken in bad faith and which is remedied by the Company promptly after
receipt of notice thereof given by Executive (but not excluding changes resulting from a sale of
the Company, whether by merger, tender offer or otherwise) provided that Executive shall act within
30 days of becoming aware of any such diminution in the scope of his duties, responsibilities,
authority or position; (iv) if the Company shall breach or shall have continued to fail to comply
with any material provision of this Agreement after a 30-day period to cure (if such failure is
curable) following written notice to the Company of such non-compliance; (v) if the Board of
Directors requires Executive without his express written consent to relocate to any area outside of Ireland, other than pursuant to Section 4(a)(vi); or (vi)
upon a change in control of the Company or within twelve (12) months of any such change in control
(for these purposes the term “change in control” shall have the meaning set forth in Rule 405 of
the Securities Act of 1933), or within twelve (12) months of a sale of substantially all of the
assets of the Company or the merger out of existence of the Company. In the event of any
termination for “Good Reason” under this Section 4(c), the Company shall, as liquidated damages or
severance pay, or both, pay the Termination Payments, as defined in (b) of this Section 4, to
Executive, when, as and if such payments would have been made in the absence of Executive’s
termination.
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(d) During any period in which Executive is obligated not to compete with the Company pursuant
to Section 5 hereof (unless Executive was terminated for Cause as defined herein), Executive and
his family shall continue to be covered by the Company’s life, medical, health and death plans.
Such coverage shall be at the Company’s expense to the same extent as if Executive were still
employed by the Company. In the event of a termination pursuant to Sections 4(a)(vi), 4(b) or 4(c),
the Company shall provide to Executive the pro-rata share of his annual bonus, to the extent one is
awarded by the Compensation Committee the consideration of which shall be taken in good faith,
giving a full month’s credit for any partial month worked in that bonus year. Additionally, in the
event of a termination pursuant to Sections 4(a)(vi), 4(b) or 4(c), the Company shall provide to
Executive, at the Company’s expense, outplacement services of a nature customarily provided to a
senior executive. Notwithstanding the foregoing, the obligations of the Company pursuant to this
Section 4(d) shall remain in effect no longer than the term of the Termination Payments.
(e) In the event that any amounts payable and/or any benefits provided to the Executive under
the terms of this Agreement and/or under any other plan, agreement or arrangement by which he is to
receive payments or benefits in the nature of compensation would constitute “excess parachute
payments” as that term is defined for purposes of Section 280G of the Internal Revenue Code of
1986, as amended (“Code”) and Treasury Regulations promulgated pursuant thereto, then the amounts
payable under the terms of this Agreement and/or under any other plan, agreement or arrangement
shall be reduced so that no payments are deemed “excess parachute payments.” Any decisions
regarding this requirement or implementation of reductions shall be made by tax counsel selected by
the Company.
(f) If any payment to Executive under the terms of this Agreement is determined to constitute
a payment of nonqualified deferred compensation for purposes of Section 409A of the Code, such
payment shall be delayed until the date that is six months after the date of Executive’s separation
from service with the Company, so as to comply with the special rule for certain “specified
employees” set forth in Code Section 409A(a)(2)(B)(i) unless it is determined that immediate
distribution is permissible (and does not trigger any additional tax liability pursuant to Code
Section 409A(a)(1)) pursuant to Code Section 409A(a)(2)(A)(v) by reason of being payable in
connection with a change in the ownership or effective control of the Company or in the ownership
of a substantial position of the assets of the Company.
(g) The Executive agrees that as of or following the termination of the Executive’s employment
for any reason or for no reason, he shall immediately resign as a member of the Company’s Board of
Directors if so requested by the Company.
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| 5. | Non-Competition. |
During the period of Executive’s employment hereunder and during the period, if any, during
which payments are required to be made to the Executive by the Company pursuant to Sections
4(a)(vi), 4(b) or 4(c), the Executive shall not, within any state or foreign jurisdiction in which
the Company or any subsidiary of the Company is then providing services or products or marketing
its services or products (or engaged in active discussions to provide such services), or within a
fifty (50) mile radius of any such state or foreign jurisdiction, directly or indirectly own any
interest in, manage, control, participate in, consult with, render services for, or in any manner
engage in any business engaged in by the Company (unless the Board of Directors shall have
authorized such activity and the Company shall have consented thereto in writing). The term
“business engaged in by the Company” shall mean the development and commercialization of autologous
fibroblast system technology for application in, among other therapies, dermatology, surgical and
post-traumatic scarring, skin ulcers, cosmetic surgery, periodontal disease, reconstructive
dentistry, vocal chord injuries, urinary incontinence, and digestive and gastroenterological
disorders and other applications relating to the market for autologous fibroblast or UMC cells and
the five derivative cell lines: osteoblast, chondroblast, fibroblast, adipocyte, and neuroectoderm.
Investments in less than five percent of the outstanding securities of any class of a corporation
subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act
of 1934, as amended, shall not be prohibited by this Section 5. At the option of Executive,
Executive’s obligations under this Section 5 arising after the termination of Executive shall be
suspended during any period in which the Company fails to pay to him Termination Payments required
to be paid to him pursuant to this Agreement. The provisions of this Section 5 are subject to the
provisions of Section 14 of this Agreement.
| 6. | Inventions and Confidential Information. |
The parties hereto recognize that a major need of the Company is to preserve its specialized
knowledge, trade secrets, and confidential information. The strength and good will of the Company
is derived from the specialized knowledge, trade secrets, and confidential information generated
from experience with the activities undertaken by the Company and its subsidiaries. The disclosure
of this information and knowledge to competitors would be beneficial to them and detrimental to the
Company, as would the disclosure of information about the marketing practices, pricing practices,
costs, profit margins, design specifications, analytical techniques, and similar items of the
Company and its subsidiaries. The Executive acknowledges that the proprietary information,
observations and data obtained by him while employed by the Company concerning the business or
affairs of the Company are the property of the Company. By reason of his being a senior executive
of the Company, the Executive has or will have access to, and has obtained or will obtain,
specialized knowledge, trade secrets and confidential information about the Company’s operations
and the operations of its subsidiaries, which operations extend throughout the United States. For
purposes of this Section 6, “Company” shall mean the Company and each of its controlled
subsidiaries. Therefore, subject to the provisions of Section 14 hereof, the Executive hereby
agrees as follows, recognizing that the Company is relying on these agreements in entering into
this Agreement:
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(i) During the period of Executive’s employment with the Company and thereafter, the Executive
will not use, disclose to others, or publish or otherwise
make available to any other party any inventions or any confidential business information
about the affairs of the Company, including but not limited to confidential information concerning
the Company’s products. “Confidential Information” shall include commercial or trade secrets about
Company’s products, methods, engineering designs and standards, analytical techniques, technical
information, customer information, employee information, or financial and business records, any of
which contains proprietary information created or acquired by the Company and which information is
held in confidence by Company. Confidential Information does not include information which: (i)
becomes generally available to the public, unless said Confidential Information was disclosed in
violation of a confidentiality agreement; or (ii) becomes available to Executive on a
non-confidential basis from a source other than the Company or its agents, provided that such
source is not bound by a confidentiality agreement with the Company.
(ii) During the period of Executive’s employment with the Company and for twelve (12) months
thereafter, (a) the Executive will not directly or indirectly through another entity induce any
employee of the Company to leave the Company’s employ (unless the Board of Directors shall have
authorized such employment and the Company shall have consented thereto in writing) or in any way
interfere with the relationship between the Company and any employee thereof or (b) tortiously
interfere with the Company’s business relationship with any customer, supplier, licensee, licensor
or other business relation of the Company.
| 7. | Indemnification. |
The Company will indemnify (and advance the costs of defense of) and hold harmless the
Executive (and his legal representatives) to the fullest extent permitted by the laws of the state
in which the Company is incorporated, as in effect at the time of the subject act or omission, or
by the Certificate of Incorporation and Bylaws of the Company, as in effect at such time or on the
date of this Agreement, whichever affords greater protection to the Executive, and the Executive
shall be entitled to the protection of any insurance policies the Company may elect to maintain
generally for the benefit of its executive officers, against all judgments, damages, liabilities,
costs, charges and expenses whatsoever incurred or sustained by him or his legal representative in
connection with any action, suit or proceeding to which he (or his legal representatives or other
successors) may be made a party by reason of his being or having been an officer of the Company or
any of its subsidiaries except that the Company shall have no obligation to indemnify Executive for
liabilities resulting from conduct of the Executive with respect to which a court of competent
jurisdiction has made a final determination that Executive committed gross negligence or willful
misconduct.
| 8. | Litigation Expenses. |
In the event of any litigation or other proceeding between the Company and the Executive with
respect to the subject matter of this Agreement and the enforcement of the rights hereunder, the
losing party shall reimburse the prevailing party for all of his/its reasonable costs and expenses
relating to such litigation or other proceeding, including, without limitation, his/its reasonable
attorneys’ fees and expenses.
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| 9. | Consolidation; Merger; Sale of Assets; Change of Control. |
Nothing in this Agreement shall preclude the Company from combining, consolidating or merging
with or into, transferring all or substantially all of its assets to, or entering into a
partnership or joint venture with, another corporation or other entity, or effecting any other kind
of corporate combination provided that the corporation resulting from or surviving such
combination, consolidation or merger, or to which such assets are transferred, or such partnership
or joint venture assumes this Agreement and all obligations and undertakings of the Company
hereunder. Upon such a consolidation, merger, transfer of assets or formation of such partnership
or joint venture, this Agreement shall inure to the benefit of, be assumed by, and be binding upon
such resulting or surviving transferee corporation or such partnership or joint venture, and the
term “Company,” as used in this Agreement, shall mean such corporation, partnership or joint
venture or other entity, and this Agreement shall continue in full force and effect and shall
entitle the Executive and his heirs, beneficiaries and representatives to exactly the same
compensation, benefits, perquisites, payments and other rights as would have been their entitlement
had such combination, consolidation, merger, transfer of assets or formation of such partnership or
joint venture not occurred.
| 10. | Survival of Obligations. |
Sections 4, 5, 6, 7, 8, 9, 11, 12 and 14 shall survive the termination for any reason of this
Agreement (whether such termination is by the Company, by the Executive, upon the expiration of
this Agreement or otherwise).
| 11. | Executive’s Representations. |
The Executive hereby represents and warrants to the Company that to the best of his knowledge:
(i) the execution, delivery and performance of this Agreement by the Executive do not and shall not
conflict with, breach, violate or cause a default under any contract, agreement, instrument, order,
judgment or decree to which the Executive is a party or by which he is bound, (ii) the Executive is
not a party to or bound by any employment agreement, non-compete agreement or confidentiality
agreement with any other person or entity and (iii) upon the execution and delivery of this
Agreement by the Company, this Agreement shall be the valid and binding obligation of the
Executive, enforceable in accordance with its terms. The Executive hereby acknowledges and
represents that he has consulted with legal counsel regarding his rights and obligations under this
Agreement and that he fully understands the terms and conditions contained herein.
| 12. | Company’s Representations. |
The Company hereby represents and warrants to the Executive that (i) the execution, delivery
and performance of this Agreement by the Company do not and shall not conflict with, breach,
violate or cause a default under any contract, agreement, instrument, order, judgment or decree to
which the Company is a party or by which it is bound; (ii) upon the execution and delivery of this
Agreement by the Executive, this Agreement shall be the valid and binding obligation of the
Company, enforceable in accordance with its terms; and (iii) the Company’s representations made by
the Board of Directors and members of senior management prior to the
execution of this Agreement regarding the science, business or fiscal propriety of the Company
are accurate in all material respects.
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| 13. | Enforcement. |
Because the Executive’s services are unique and because the Executive has access to
confidential information concerning the Company, the parties hereto agree that money damages would
not be an adequate remedy for any breach of this Agreement. Therefore, in the event of a breach of
this Agreement, the Company may, in addition to other rights and remedies existing in its favor,
apply to any court of competent jurisdiction for specific performance and/or injunctive or other
relief in order to enforce, or prevent any violations of, the provisions hereof (without posting a
bond or other security).
| 14. | Severability. |
In case any one or more of the provisions or part of a provision contained in this Agreement
shall for any reason be held to be invalid, illegal or unenforceable in any respect in any
jurisdiction, such invalidity, illegality or unenforceability shall be deemed not to affect any
other jurisdiction or any other provision or part of a provision of this Agreement, nor shall such
invalidity, illegality or unenforceability affect the validity, legality or enforceability of this
Agreement or any provision or provisions hereof in any other jurisdiction; and this Agreement shall
be reformed and construed in such jurisdiction as if such provision or part of a provision held to
be invalid or illegal or unenforceable had never been contained herein and such provision or part
reformed so that it would be valid, legal and enforceable in such jurisdiction to the maximum
extent possible. In furtherance and not in limitation of the foregoing, the Company and the
Executive each intend that the covenants contained in Sections 5 and 6 shall be deemed to be a
series of separate covenants, one for each and every state of the United States and any foreign
country set forth therein. If, in any judicial proceeding, a court shall refuse to enforce any of
such separate covenants, then such unenforceable covenants shall be deemed eliminated from the
provisions hereof for the purpose of such proceedings to the extent necessary to permit the
remaining separate covenants to be enforced in such proceedings. If, in any judicial proceeding, a
court shall refuse to enforce any one or more of such separate covenants because the total time,
scope or area thereof is deemed to be excessive or unreasonable, then it is the intent of the
parties hereto that such covenants, which would otherwise be unenforceable due to such excessive or
unreasonable period of time, scope or area, be enforced for such lesser period of time, scope or
area as shall be deemed reasonable and not excessive by such court.
| 15. | Entire Agreement: Amendment. |
This Agreement sets forth the entire agreement and understanding of the parties hereto with
respect to the matters covered hereby and supersedes any prior agreement or understanding,
including without limitation the 2007 Employment Agreement, which is as of the Effective Date
terminated and of no further legal force or effect. Executive acknowledges and agrees that he
resigns from the position of Chief Operating Officer as of the Effective Date. This Agreement may
not be amended, waived, changed, modified or discharged except by an instrument in writing executed
by or on behalf of the party against whom enforcement of any amendment,
waiver, change, modification or discharge is sought. No course of conduct or dealing shall be
construed to modify, amend or otherwise affect any of the provisions hereof.
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| 16. | Notices. |
All notices, requests, demands and other communications hereunder shall be in writing and
shall be deemed to have been duly given if physically delivered, delivered by express mail or other
expedited service or upon receipt if mailed, postage prepaid, via registered mail, return receipt
requested, addressed as follows:
(a)
|
To the Company: | (b) | To the Executive: | |||
| Isolagen | Xxxxxx Xxxx | |||||
| 000 Xxxxxxxxx Xxxx. | 00 Xxxxx Xxxx | |||||
| Xxxxx 000 | Xxxxxxxxx, | |||||
| Xxxxx, XX 00000 | Co. Dublin | |||||
| Ireland |
and/or to such other persons and addresses as any party shall have specified in writing to the
other.
| 17. | Assignability. |
This Agreement shall not be assignable by either party and shall be binding upon, and shall
inure to the benefit of, the heirs, executors, administrators, legal representatives, successors
and assigns of the parties. In the even that all or substantially all of the business of the
Company is sold or transferred, then this Agreement shall be binding on the transferee of the
business of the Company whether or not this Agreement is expressly assigned to the transferee.
| 18. | Governing Law. |
This Agreement shall be governed by and construed under the laws of the Commonwealth of
Pennsylvania.
| 19. | Waiver and Further Agreement. |
Any waiver of any breach of any terms or conditions of this Agreement shall not operate as a
waiver of any other breach of such terms or conditions or any other term or condition, nor shall
any failure to enforce any provision hereof operate as a waiver of such provision or of any other
provision hereof. Each of the parties hereto agrees to execute all such further instruments and
documents and to take all such further action as the other party may reasonably require in order to
effectuate the terms and purposes of this Agreement.
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| 20. | Headings of No Effect. |
The paragraph headings contained in this Agreement are for reference purposes only and shall
not in any way affect the meaning or interpretation of this Agreement.
13
IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement as of the date
first above written.
| COMPANY: | ||||
| ISOLAGEN, INC. | ||||
| By | ||||
| EXECUTIVE: | ||||
| Xxxxxx Xxxx | ||||
