MODIFICATION, SETTLEMENT AND RELEASE AGREEMENT
THIS
MODIFICATION SETTLEMENT AND RELEASE AGREEMENT (the “Agreement”) is made
as of March 4, 2009 (the “Effective Date”) by
and between Xxxx X. Xxxxxxxxx, (the “Executive”) and
Hemobiotech Inc. (the “Company”).
WHEREAS,
the Company and the Executive have previously entered into an employment
agreement dated April 1, 2005, which was extended on April 23, 2008 (the “Employment
Agreement”); and
WHEREAS,
the Company and the Executive desire to modify the Employment Agreement between
the parties and set forth certain other agreements between the
parties.
NOW
THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged, the
Company and the Executive hereby agree as follows:
1. Lump Sum
Payment. Upon the signing of this Agreement, the Executive
shall receive (i) a lump sum payment of $25,000 and (ii) 65,000 shares of
unregistered and restricted shares of the Company’s common stock (the “Shares”) that will
vest one (1) year after the Effective Date. If the Executive shall no
longer be employed by the Company within one year of the Effective Date, unless
the Company is bankrupt, insolvent, or the Executive’s employment with the
Company has been terminated pursuant to Section 6(c) of the Employment
Agreement, the Executive shall (i) pay $25,000 to the Company (the “Refund”) and (ii)
forfeit the Shares. On the date hereof, the Executive shall execute a confession
of judgment, substantially in the form attached hereto as Exhibit A, relating
to the payment of the Refund as set forth in the previous sentence. The Company
and the Executive acknowledge and agree that the Company shall have the right to
file the executed confession of judgment, substantially in the form attached
hereto as Exhibit
A, only if the Executive shall no longer be employed by the Company
within one year of the Effective Date, and the Company is not bankrupt or
insolvent, or the Executive’s employment with the Company has not been
terminated pursuant to Section 6(c) of the Employment Agreement.
2. Amendment of Employment
Agreement. Section 3(a) of the Employment Agreement is hereby
amended to provide that the Executive’s salary for the twelve (12) month period
following the date of this Agreement shall be $10,115 per
month. Notwithstanding the forgoing, if the Company consummates a
financing for gross proceeds of at least three million dollars ($3,000,000)
within twelve (12) months from the Effective Date, then this Section 2 shall be
null and void following the closing of such financing and the Executive shall
receive such salary as was in place immediately prior to the salary reduction on
October 17, 2008 (Monthly salary of $14,452) pursuant to Section 3(a)
of the Employment Agreement.
3. Further Salary
Reduction. Notwithstanding anything contained herein to the
contrary, if the Company reduces the Executive’s salary below the $10,115 amount
specified in Section 2, the Executive shall: (i) be released from the confession
of judgment and (ii) not be obligated to make the Refund nor return the 65,000
shares and the shares shall immediately vest, as liquidated damages in
connection with such reduction.
4. Release: Each
of the Company and the Executive hereby agree and acknowledge that as
consideration for entering this Agreement and performing hereunder, and other
good and valuable consideration, each party hereby agrees to waive all claims,
now and in the future, against the other party and release and discharge the
other party, its respective parents, subsidiaries, successors, assigns,
representatives, agents, shareholders, partners, beneficiaries, officers,
directors, attorneys, consultants, advisors and employees from any liability for
any claims or damages, now and in the future, that the releasing party may have
against it and its respective parents, subsidiaries, successors, assigns,
representatives, agents, shareholders, partners, beneficiaries, officers,
directors, attorneys, consultants, advisors and employees as of the Effective
Date, whether known or unknown, including, but not limited to, any claims
arising out of the employment relationship with the Company or with its
respective parents, subsidiaries, successors, assigns, representatives, agents,
shareholders, partners, beneficiaries, officers, directors, attorneys,
consultants, advisors and employees, or termination thereof, or violations of
any federal, state, or local fair employment practices law, including but not
limited to the Age Discrimination in Employment Act (“ADEA”), 29 U.S.C.
§ 621 et
seq., the
Americans with Disabilities Act (“ADA”), 42 U.S.C. § 12101 et seq., the Civil
Rights Act of 1991, 42 U.S.C. § 1981a et seq., the Executive
Retirement Income Security Act (“ERISA”), 29 U.S.C.
§ 1001 et
seq., the Fair
Labor Standards Act (“FLSA”),
29 U.S.C. § 201 et seq., the Family and
Medical Leave Act (“FMLA”), Title VII of
the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., the
Xxxxxxxx-Xxxxx Act of 2002, or of any other similar federal, state, or municipal
statutes or ordinances prohibiting discrimination or pertaining to employment,
and any contract, tort, or common law theories with respect to the Executive’s
hiring by the Company, the terms and conditions of his employment with the
Company, or other obligations or any right under any employment agreement, stock
plan, bonus plan, incentive plan, vacation, or other benefits, all claims for
compensation including back wages, front pay, or any other form of economic
loss.
5. Effectiveness. The
terms of this Agreement shall be effective as of the Effective
Date.
6. Confirmation of the
Employment Agreement. Except as amended or modified hereby,
all of the terms of the Employment Agreement shall remain and continue in full
force and effect and are hereby confirmed in all respects, and all references to
the Employment Agreement shall be deemed to refer to the Employment Agreement as
amended or modified hereby.
7. Entire
Agreement. This Agreement, together with Exhibit A,
constitutes the entire agreement between the parties hereto relating to the
subject matter hereof, and supersedes all prior agreements and understandings,
whether oral or written, with respect to the same. No modification, alteration,
amendment or revision of or supplement to this Agreement shall be valid or
effective unless the same is in writing and signed by both parties
hereto.
8. Governing
Law. This Agreement and the rights and duties of the parties
hereunder shall be governed by, construed under and enforced in accordance with
the laws of the State of Texas.
9. Severability. The
invalidity of any provision of this Agreement under the applicable laws of the
State of Texas or any other jurisdiction, shall not affect the other provisions
hereby declared to be severable from all other provisions. The
intention of the parties, as expressed in any provision held to be void or
ineffective, shall be given such full force and effect as may be permitted by
law.
10. Counterparts. This
Agreement may be executed and delivered (including by facsimile or portable
document format (PDF) transmission) in one or more counterparts, and by the
different parties hereto in separate counterparts, each of which when executed
shall be deemed to be an original, but all of which taken together shall
constitute one and the same Agreement.
[Signature
page follows]
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date set
forth above.
Hemobiotech Inc.
By ____________________________________
Name:
Title:
By ______________________________________
Xxxx X.
Xxxxxxxxx
