EMPLOYMENT AGREEMENT (Rouslan Semechkin)
Exhibit 10.5
(Xxxxxxx
Xxxxxxxxx)
THIS AGREEMENT is made as of the 30th
day
of
December,
2008
("Commencement Date"), by and between International Stem Cell Corporation, a Delaware corporation with a principal place of business at 0000 Xxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxxx (the "Company"), and
Xxxxxxx Xxxxxxxxx (the "Employee"), with an address
at 0 Xxxxxxxx Xxxxx, Xxxx 00, Xxxxxxx, Xxx Xxxxxxxxx
("Agreement").
FACTUAL
BACKGROUND:
A. On
December 30, 2008, the Company entered into a Preferred Stock Purchase Agreement
with Xxxxxx Xxxxxxxxx, Xxxxxxx Xxxxxxxxx and X-Master, Inc., (the "Investors")
pursuant to which the Investors agreed to purchase at least ten (10) shares of
Series D Preferred Stock from the Company for a purchase price of up to Five
Million Dollars ($5,000,000 USD). As a material and essential inducement for the
Investors to enter into the Preferred Stock Purchase Agreement, the Company
agreed to employ Xxxxxxx Xxxxxxxxx and Xxxxxx Xxxxxxxxx in accordance with the
terms thereof.
B. The
Company wishes to employ Employee initially as a research scientist reporting
directly to the Chief Scientist and upon Employee attaining his PhD, as Senior
Research Scientist (or such other senior research position commensurate with
Employee's experience and status with the Company) and Employee wishes to accept
such employment subject to the terms and conditions of this
Agreement.
NOW,
THEREFORE, in consideration of the foregoing, the employment provided hereunder,
and other valuable consideration, receipt of which is hereby acknowledged, the
parties hereto agree as follows:
1. EMPLOYMENT.
Upon Employee providing Company with documentation verifying Employee's identity
and legal authorization to work in the United States, Company agrees to employ
Employee, and Employee agrees to perform the duties assigned to him for the Term
of this Agreement (as defined in Section 2 of the Agreement) pursuant to the
terms and conditions set forth herein.
2.
TERM. The
term of Employee's employment hereunder shall be for a period of five (5) years,
beginning on the Commencement Date set forth above and continuing for a period
of five (5) years following such date ("Term"), unless sooner terminated in
accordance with section 4 below.
3. COMPENSATION.
For all services to be rendered by Employee in any capacity hereunder, the
Company shall pay Employee the following:
(a)
SALARY. The Company shall initially pay Employee an annual salary of Eighty
Thousand Dollars ($80,000) while he is employed as a research scientist, and an
annual salary of One Hundred Twenty Thousand Dollars ($120,000) upon Employee
attaining his PhD and corresponding promotion by the Company to Senior Research
Scientist or a similar position commensurate with Employee's experience and
status with the Company, less withholding and other taxes required by federal
and state law (the "Annual Base Salary"). Employee's Annual Base Salary shall,
in any event, be not less than the annual base salaries paid to employees of
similar position and status within the Company. Employee's Annual Base Salary
shall be payable in equal installments at such payment intervals as are the
usual custom of the Company, but not less often than monthly. Employee shall be
eligible to receive increases in his Annual Base Salary pursuant to periodic
salary reviews by the Company it being understood such increases are not
guaranteed, but are subject to Employee's job performance and the determination
by the Company, in its sole discretion, to award salary increases to Employee.
The Annual Base Salary shall not be decreased during the Term, unless the
reduction is made as part of, and is consistent with, a general reduction
of the annual base salaries paid to employees of similar position and
status within the Company.
(b)
BENEFITS. During the Term, Employee shall be entitled to participate in all
employee welfare and health benefit plans and other employee benefit plans
established or maintained by the Company for the benefit of its employees.
Employee shall be required to comply with all conditions attendant to coverage
by such plans and shall be entitled to benefits only in accordance with the
terms and conditions of such plans as they may be amended from time to time.
Nothing herein shall be construed as requiring the Company to establish or
continue any particular benefit plan.
(c)
VACATION AND LEAVE. During the Term, Employee shall be
entitled to accrue and carry over vacation benefits in a manner consistent with
employees of similar position and status within the Company, in accordance with
the Company's vacation policy as in effect from time to time. In addition,
Employee shall be allowed to take up to thirty (30) days
unpaid leave (or such greater amount as Employee deems necessary to attend to
his business and personal affairs) during each year of the Term.
(d)
BONUS. Employee may also be awarded a bonus or bonuses from time to time during
the Term in such amounts, if any, and at such time, if any, as the Company may
determine, in its sole discretion. Employee shall be entitled to participate in
any annual performance bonus program for employees with bonus amounts and
performance criteria to achieve the bonus amounts as set and formally approved
by the Company in its sole discretion.
4.
TERMINATION.
(a) FOR
CAUSE. Although Company anticipates a mutually rewarding employment relationship
with Employee, Company may terminate Employee's employment immediately at any
time for Cause. For purposes of this Agreement, "Cause" is defined as: (i)
Employee's conviction or entry of a plea of nolo contendere for fraud,
misappropriation or embezzlement, or any felony or crime of moral turpitude or
that otherwise negatively impacts Employee's ability to effectively perform
Employee's duties hereunder; (ii)
Employee's inability to perform the essential functions of Employee's position,
with or without reasonable accommodation, due to a mental or physical disability
for a period of 120 days; or
(iii) Employee's death. In the event Employee's employment is terminated in
accordance with this section 4(a), Employee shall not be entitled to payment of
any further compensation, salary or benefits under the terms of this Agreement
except (i) Annual Base Salary through the date of termination; (ii) any vested
benefits under the then current employee benefit plans in which the Employee
participates; (iii) accrued but unused vacation; and (iv) any benefit
continuation or conversion rights under the then current employee benefit
plans in which the Employee participates.
(b)
VOLUNTARY RESIGNATION BY EMPLOYEE. Employee may resign from employment at any
time for any reason by giving sixty (60) days written notice to Company of such
intention. In such event, Company may, in its discretion, permit Employee to
work through the notice period or accept Employee's immediate resignation. In
the event of a voluntary resignation or other termination by the Employee,
Employee shall not be entitled to payment of any further compensation,
salary or benefits under the terms of this Agreement except (i) Annual Base
Salary through the date of termination; (ii) any vested benefits under the then
current employee benefit plans in which the Employee participates; (iii) accrued
but unused vacation; and (iv) any benefit continuation or conversion rights
under the then current employee benefit plans in which the Employee
participates.
5.
CONFLICTS OF INTEREST. During the term of Employee's employment with Company,
Employee must not engage in any work, paid or unpaid, that creates a conflict of
interest which materially and substantially disrupts the operations of Company.
Such work shall include, but is not limited to, directly competing with Company
in any way, or acting as an officer, director, employee, or consultant of any
business enterprise of the same nature as, or which is in direct competition
with, the business in which Company is now engaged or in which Company becomes
engaged during the term of Employee's employment with Company, as may be
determined by Company in its reasonable discretion. If Company believes such a
conflict exists during the term of this Agreement, Company may ask Employee to
choose to discontinue the other work and/or activities or resign employment with
Company. Notwithstanding the foregoing, the Company acknowledges that the
Employee may become an investor in companies and business enterprises who may be
in the same or similar business to the Company's business, and the Company
hereby agrees and acknowledges that such investments shall not violate this
section 5.
6. CONFIDENTIALITY
AND PROPRIETARY RIGHTS. As a condition of employment, Employee agrees to read,
sign and abide by Company's Employee Invention and Confidentiality Agreement
(which agreement shall be modified to allow investment in business enterprises
who may be in the same or similar business to the Company's business), which is
provided with this Agreement and incorporated herein by reference.
7. GOVERNING
LAW, JURISDICTION AND VENUE. This Agreement shall be governed by and construed
in accordance with the laws of the State of California.
8. HEADINGS.
The descriptive headings of the several sections of this Agreement are
inserted for convenience of reference only and shall not control or affect the
meanings or construction of any of the provisions hereof.
9. SEVERABILITY
AND VIOLATION OF LAWS. If any provision of this Agreement shall be held invalid
or unenforceable according to law, such provision shall be modified to the
extent necessary to bring it within the legal requirements. Any such invalidity
or unenforceability shall not affect the remaining provisions of this Agreement,
and such remaining provisions shall continue in full force and
effect.
10. NOTICES.
Any notice or other communication required or permitted under this agreement
shall be in writing and shall be deemed to have been duly given (a) upon hand
delivery, or (b) on the third day following delivery to the U.S. Postal Service
as certified or registered mail, return receipt requested and postage prepaid,
(c) on the first day following delivery to a nationally recognized United States
overnight courier services for next business day delivery with fee prepaid, or
(d) when telecopied or sent by facsimile transmission if an additional notice is
also given under (a), (b) or (c) above within three (3) days thereafter. Any
such notice or communication shall be directed to a party at its address set
forth below or at such other address as may be designated by a party in a
notice given to all other parties hereto in accordance with the provisions of
this section.
FOR THE
COMPANY:
Xx.
Xxxxxxx X. Xxxxxxx
Chairman
of the Board
0000
Xxxxx Xxxxx
Xxxxxxxxx,
XX 00000
Telephone:
(000) 000-0000
Telecopy:
(000) 000-0000
with a
copy to:
XX
Xxxxx
0000
Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxx
Xxxxx, Xxxxxxxxxx 00000-0000
Attention:
Xxxxxxx X. Xxxx, Esquire
Telephone:
000-000-0000
Fax:
000-000-0000
FOR THE
EMPLOYEE:
Xx.
Xxxxxxx Xxxxxxxxx
0
Xxxxxxxx Xxxxx, Xxxx 00
Xxxxxxx,
XX 00000
with a
copy to:
McLane,
Graf, Xxxxxxxxx & Xxxxxxxxx,
Professional
Association
000 Xxx
Xxxxxx
X.X. Xxx
000
Xxxxxxxxxx,
XX 00000-0000
Attention:
Xxxxxx X. Xxxxxxxx, Esq.
Telephone:
000-000-0000
Telecopy:
000-000-0000
11.
ASSIGNMENT. The rights and obligations of Company together with its obligations
and all of Employee's covenants and agreements hereunder may be assigned by
Company to any parent, subsidiary or other affiliate of the Company by operation
of law or by contractual assignment; provided, however, that the Company shall
continue to guarantee the obligations, agreements, duties and covenants
hereunder. The rights and obligations of Employee under this Agreement are not
assignable.
12. COMPLETE
AND ENTIRE AGREEMENT. This Agreement, including the Company's Employee Invention
and Confidentiality Agreement, contains all of the terms agreed upon by the
parties with respect to the subject matter hereof and supersedes all prior
agreements, representations and warranties of the parties as to the subject
matter hereof.
13. AMENDMENTS.
This Agreement may be amended, or any provision of the Agreement may be waived,
provided that any such amendment or waiver will be binding on the parties only
if such amendment or waiver is set forth in a writing executed by all parties
hereto. The waiver by any party hereto of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any other
breach.
14. SURVIVAL.
Sections 5, 6, 7, 9 and 10 shall survive expiration of the Term of this
Agreement and/or termination of Employee's employment under this
Agreement.
[Signature
Page Follows]
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement, all as of the
date first written above.
|
INTERNATIONAL
STEM CELL CORPORATION
|
||
| By: /s/ Xxxxxxx X. Xxxxxxx | ||
|
Witness
|
Xxxxxxx
X. Xxxxxxx, CEO
|
|
| /s/ signature | /s/ Xxxxxxx Xxxxxxxxx | |
| Witness | Xxxxxxx Xxxxxxxxx | |
