CONSULTING AGREEMENT
Exhibit
10.47
This
Consulting Agreement (this “Agreement”)
is
entered into by and between Cytori Therapeutics, Inc., a Delaware corporation
(the “Company”),
and
Xxxxxxxx X. Xxx (“Consultant”),
effective as of May 3, 2007 (the “Retirement Date”).
WHEREAS,
Consultant is retiring and resigning from his positions as a Company director
and employee, and
WHEREAS,
the Company wishes to honor Consultant with recognition as Chairman Emeritus
and
to retain access to his advice and counsel during a transition
period.
NOW,
THEREFORE, in consideration of the foregoing and the mutual agreements set
forth
herein, the parties agree as follows.
1. Consulting
Relationship.
During
the term of this Agreement, Consultant will provide consulting
services
(the “Services”) on an as-needed basis to the Company as may be specified from
time to time by the Company’s Chief Executive Officer (the “CEO”) as to scope,
subject matter, timing, format and location, all in the CEO’s reasonable
discretion. Notwithstanding the foregoing, Consultant will not be required
to
travel or to perform services in the Company’s offices, nor shall he be required
to provide more than ten hours of service per month. Consultant generally
will
perform services in his own facility. When Consultant deems it necessary
or
appropriate to spend time in the Company’s facility, the Company will provide
Consultant with space to work, but Consultant will not have a regularly assigned
workspace.
2. Compensation.
As
consideration for the Services to be provided by Consultant, the Company
shall
pay to Consultant $5,000 per month, payable in arrears, during the term of
this
Agreement. Consultant shall be responsible for all taxes on such amount.
The
Company shall promptly reimburse Consultant for all reasonable out-of-pocket
incurred in carrying out the Services requested pursuant to this Agreement,
subject to documentation in accordance with the Company’s business expense
reimbursement policy, as in effect from time to time.
It is
also understood and acknowledged that, during the term of this Agreement,
and in
accordance with the existing terms of the applicable stock option plans and
agreements, Consultant’s outstanding stock options shall continue to vest and be
exercisable.
3 Term
of Agreement.
The
term of this Agreement shall begin on the Retirement Date and end on March
1,
2009. The Company may terminate this Agreement prior to the expiration of
such
term only in the event that Consultant commits fraud in the commission of
his
Services on behalf of the Company hereunder, and has failed to cure such
acts or
failures to act which are alleged to constitute fraud within sixty days after
receipt of written notice from the Company stating in detail the particular
acts
or failures to act that constitute the grounds on which the proposed termination
is based.
4. Retirement.
This
Agreement constitutes Consultant’s retirement and resignation as a Company
director and employee as of the Retirement Date. This
Agreement also constitutes the Company’s appointment of Consultant as Chairman
Emeritus for life effective upon the Retirement Date. The parties confirm
that
the position of Chairman Emeritus is an honorary, unpaid position and does
not
itself constitute Consultant an employee or consultant of the
Company.
5. Independent
Contractor.
Consultant’s relationship with the Company during the term of this Agreement
will be that of an independent contractor and not that of a director, officer,
employee or agent. During the term of this Agreement:
(a) No
Authority to Bind Company.
Consultant has no authority to enter into contracts that bind the Company
or
create obligations on the part of the Company, and he agrees not to purport
to
do so.
(b) No
Benefits.
Consultant acknowledges and agrees that Consultant will not, by virtue of
this
consultancy, be eligible for any Company employee benefits, except as provided
under Sections 2, 6 and 10.
6. Other
Agreements.
Except
as otherwise specified in this Agreement, all agreements between the Company
and
Consultant pertaining to his service and compensation as an employee and/or
director are hereby terminated by mutual agreement and without any further
obligation of either party, with the exception of Consultant’s stock option
agreements, any indemnification and/or insurance rights Consultant may have
pursuant to the Company’s certificate of incorporation, bylaws or insurance
policies for officers and directors liability (provided, that the Company
shall
have no obligation to purchase future directors and officers liability
insurance, nor renew any directors and officers liability insurance, for
the
purpose of covering Consultant for periods after the Retirement Date or for
maintaining the benefit of coverage under past or current policies), and
any
employee benefit plans or agreements the provisions of which will continue
to
govern the Consultant’s and the Company’s rights and obligations with respect to
benefits accrued through the Retirement Date.
7. Consulting
or Other Services for Competitors.
Consultant represents and warrants that Consultant does not presently perform
or
intend to perform, during the term of this Agreement, consulting or director
or
other services for, or engage in or intend to engage in an employment
relationship with, companies whose businesses or proposed businesses in any
way
involve products or services which would be competitive with the Company’s
regenerative-cell products or services. If, however, Consultant decides to
do
so, Consultant agrees that, in advance of accepting such work, Consultant
will
promptly notify the Company in writing, specifying the organization with
which
Consultant proposes to consult, provide services, or become employed
by.
8. The
Employment, Confidentiality and Assignment Agreement.
Consultant represents that, immediately before signing this Agreement, he
has
signed and delivered to the Company an Employment, Confidentiality and
Assignment Agreement on the Company’s standard form of such agreement, and has
dated it “May 3, 2007, as of July 31, 2000” (the “Confidentiality
Agreement”). The Confidentiality Agreement remains in full force and effect, and
will continue to persist during the term of and after the termination or
expiration of this Consulting Agreement. In addition, Consultant and the
Company
mutually understand and agree that the terms of the Confidentiality Agreement
shall also apply to and during the term of this Consulting Agreement, with
all
applicable changes to reflect and cover the fact that his service will be
as a
consultant rather than as an employee; provided, that this Consulting Agreement
shall control in the event of any inconsistency between the provisions of
the
Confidentiality Agreement and this Consulting Agreement. (For example, Section
3
and the first paragraph of Section 4 of the Confidentiality Agreement shall
be
inapplicable during the term of consultancy.) Moreover, the Company further
agrees that its remedies for any breach of the Confidentiality Agreement
shall
not include the right to terminate this Consulting Agreement due to such
breach.
Consultant confirms that his fiduciary duty as a director with regard to
confidentiality of all confidential or proprietary information he learned
in his
capacity as a Company director persists even after his retirement and
resignation from the Board of Directors and will continue to persist during
the
term of and after the termination or expiration of this Consulting
Agreement.
9. Works
Made for Hire.
All
works of authorship created by Consultant in connection with the Services
shall
be deemed “works made for hire,” and shall be owned by the Company.
10. Post-Employment
Matters.
(a) Salary
and Vacation Time.
The
Company confirms its obligation to pay forthwith to Consultant all of his
accrued base salary and his accrued and unused vacation/holiday/paid-time-off
time through the date of this Agreement.
(b) COBRA.
The
Company and Consultant acknowledge that the Company has provided Consultant
with
forms pursuant to which he may maintain his and his eligible dependents’
participation in the Company’s group health insurance plan pursuant to the terms
of the Consolidated Omnibus Budget Reconciliation Act and corresponding
provisions of state law (“COBRA”). If Consultant elects such coverage, he
understands and agrees that he shall be fully responsible for making the
necessary premium payments in order to continue such coverage. Nothing herein
shall limit the right of the Company to change the provider and/or the terms
of
its group health insurance plans or other benefit plans at any time hereafter,
nor its right to terminate any or all plans at any time hereafter.
11. Dribble-Out.
(a) Limitation.
Consultant
agrees that in each of the five successive three-month periods beginning
immediately after the end of the (90-day) Lock-Up Period contemplated by
his
Lock-Up Agreement dated February 23, 2007 given to Xxxxx Xxxxxxx & Co. in
connection with the Company’s February 2007 registered-direct offering (the
“Lock-Up
Agreement”),
he
will sell no more than 160,000 shares of Company common stock in the three-month
period. These 160,000 share amounts are not cumulative, e.g., it is not the
case
that if he sells no shares in the first three-month period he could sell
up to
320,000 shares in the second three-month period.
(b) Definition.
This
agreement not to “sell” means that Consultant agrees not to (and
will
cause the spouse and any immediate family member of Consultant
or his spouse
living in Consultant’s
household not to) directly or indirectly, sell (including without limitation
any
short sale and also including without limitation any
sale
pursuant to a Rule 10b5-1 stock selling plan),
offer,
pledge, transfer, contract or grant any option to sell, establish an open
“put
equivalent position” within the meaning of Rule 16a-1(h) under the Securities
Exchange Act, or otherwise dispose of any shares of Common Stock, options
or
warrants to acquire shares of Common Stock, or securities exchangeable or
exercisable for or convertible into shares of Common Stock currently or
hereafter owned either of record or beneficially by Consultant
(or
such
spouse or family member), or publicly announce an intention to do any of
the
foregoing, except as expressly allowed by this Section 11, during the
(90-day) Lock-Up Period and also for
the
period commencing immediately
after the end of the (90-day) Lock-Up Period contemplated by the Lock-Up
Agreement and
ending 15 months thereafter (the “Dribble-Out
Period”).
The
foregoing sentence shall not apply to (i) any
exercise of outstanding stock options; (ii)
any
transfer to the immediate family (for the purposes of this Agreement, “immediate
family” shall mean any relationship by blood, marriage or adoption, no more
remote than first cousin) of Consultant or to a trust the beneficiaries of
which
are exclusively Consultant and/or a member or members of his immediate family;
or (iii) any transfer upon Consultant’s death; provided, however, that in any
such case of item (ii) above it shall be a condition to such transfer that
the
transferee executes and delivers to the Company an agreement stating that
the
transferee is receiving and holding the Common Stock subject to the provisions
of this Section 11, and there shall be no further transfer of such Common
Stock
during the Dribble-Out Period except in accordance with this Agreement (with
all
sales by Consultant and such item (ii) transferees within the same three-month
period being combined).
(c) Stop
Transfer.
Consultant agrees
and
consents to the entry of stop transfer instructions with the Company’s transfer
agent and registrar against the transfer of shares of Common Stock or securities
convertible into or exchangeable or exercisable for Common Stock held by
Consultant
except
in
compliance with the foregoing restrictions.
(d) Securities
Law Compliance.
Consultant acknowledges his responsibility to ensure that any and all sales
by
him comply not only with this Section 11 but also with all applicable securities
laws and regulations.
12. Miscellaneous.
(a) Amendments
and Waiver.
Any
term of this Agreement maybe amended or waived only with the written consent
of
the parties.
(b) Sole
Agreement.
This
Agreement constitutes the sole agreement of the parties, and (except to the
extent specific other agreements are expressly provided for herein for
preservation) supersedes all prior and contemporaneous negotiations, commitments
and agreements, with respect to the subject matter hereof. For avoidance
of
doubt: the stock option and other agreements specified in Section 6, the
Lock-Up
Agreement dated February 23, 2007 given to Xxxxx Xxxxxxx & Co. in connection
with the Company’s February 2007 registered-direct offering and, except as
specifically provided herein, the Confidentiality Agreement, are not
superseded.
(c) Choice
of Law.
The
validity, interpretation, construction and performance of this Agreement
shall
be governed by the laws of the State of California, without giving effect
to the
principles of conflict of laws.
(d) Arbitration.
Any
dispute or claim arising out of or in connection with any provision of this
Agreement will be finally settled by binding arbitration in Orange County,
California, in accordance with the commercial arbitration rules of the American
Arbitration Association by one arbitrator appointed in accordance with said
rules. The arbitrator shall apply California law, without reference to rules
of
conflicts of law or rules of statutory arbitration, to the substantive
resolution of any dispute. Judgment on the award rendered by the arbitrator
may
be entered in any court having jurisdiction thereof. Notwithstanding the
foregoing, the parties may apply to any court of competent jurisdiction for
preliminary or interim equitable relief, or to compel arbitration in accordance
with this paragraph, without breach of this arbitration provision. This
Section 12(d) shall not apply to the Confidentiality
Agreement.
(e) Advice
of Counsel.
Each
party acknowledges that, in negotiating and executing this Agreement,
(i) such party has had the right and the opportunity to seek the advice of
independent legal counsel of his or its own choosing, (ii) such party has
read and understood all of the terms and provisions of this Agreement, and
(iii) Xxxxxx Xxxxxx LLP and Xxxxxx Xxxxxxx, and Xxxxxxxx Xxxxxx, represent
only the Company and did not represent and are not representing
Consultant. The
Company will reimburse Consultant for up to $5,000 in reasonable attorneys’ fees
incurred by Consultant in connection with the negotiation and preparation
of
this Agreement and any related agreements contemplated hereunder.
(f) Construction.
This
Agreement shall not be construed against either party by reason of who drafted
or prepared it.
(g) Notices.
Every notice or other communication relating to this Agreement shall
be in writing, and shall be mailed to or delivered to the party for whom
it is
intended at such address as may from time to time be designated by it in
a
notice mailed or delivered to the other party as herein provided, provided
that,
unless and until some other address be so designated, all notices or
communications by Consultant to the Company shall be mailed or delivered
to the
Company at its principal executive office, and all notices or communications
by
the Company to Consultant may be given to Consultant personally or may
be mailed
to Consultant at the following address:
Xxxxxxxx
X. Xxx
[address]
[address]
with
a copy to:
Xxxxx
del Xxxxx and Xxxxx X. Xxxxxxxxx
Xxxxxxxxx
Xxxxxxxx Xxxx Xxxxxxx LLP
0000
Xxxxxxx Xxxxxx
Xxxx
Xxxx, XX 00000
Any
notice so addressed shall be deemed
to be given: (i) if delivered by hand, or by courier or overnight mail,
on the
date of such delivery; and (ii) if mailed by registered or certified mail,
on
the third business day after the date of such mailing.
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By:
/s/ Xxxx Xxxxxxx
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Title:
President
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XXXXXXXX X.
XXX
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/s/
Xxxxxxxx X. Xxx
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