EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (this “Agreement”) with an effective date of May 30,
2014 (the “Effective Date”), is by and between Cytomedix, Inc., a Delaware
corporation (together with its affiliates and subsidiaries, the “Company”), and
Dean Tozer (the “Employee”).

 

WITNESSETH:

 

WHEREAS, the Employee and the Company previously entered into a letter agreement
dated March 30, 2014; and

 

WHEREAS, the Company and the Employee desire the Employee to continue serving as
Executive Vice President, Chief Commercial Officer; and

 

WHEREAS, the parties desire to provide that the Employee be employed by the
Company under the terms of this Agreement.

 

NOW THEREFORE in consideration of the mutual covenants contained herein as well
as other good and valuable consideration, the Company and the Employee hereby
agree as follows:

 

1.           Term of Employment; Office and Duties.

 

(a)          Unless earlier terminated as provided herein, the term of this
Agreement (the “Term”) shall be for a period of thirty (30) months commencing on
the Effective Date. During the Term, and subject to the terms and conditions
herein, the Company agrees to employ Employee as Executive Vice President, Chief
Commercial Officer, based in and around the Nashville, TN area. By Employee’s
acceptance of this Agreement, Employee accepts employment in those capacities.
Employee shall report to the Company’s Chief Executive Officer and shall have
such reporting relationships to the Board of Directors as are required by and
set forth in the Company’s Bylaws, and rules and regulations applicable to the
Company. Employee shall have the powers, responsibilities, restrictions and
authorities as are assigned to Employee by the Chief Executive Officer and/or
the Board of Directors and shall devote his full working time and efforts to the
best of his ability, experience and talent to the performance of services,
duties and responsibilities as the Company’s Executive Vice President, Chief
Commercial Officer.

 

(b)          The Employee agrees to provide the services set forth hereunder on
a full-time basis and to devote all necessary time and attention to the
furtherance of the business and interests of the Company, and to perform his
duties set forth herein diligently and promptly for the benefit of Company,
strictly and faithfully upholding the Company’s policies; provided, however,
that nothing in this Agreement shall preclude the Employee from devoting time
required: (i) delivering lectures or fulfilling speaking engagements; and (ii)
engaging in charitable and community activities, including sitting on any boards
of directors and/or committees of such organizations related to such activities;
provided, however, that such activities do not unreasonably interfere with the
performance of his duties hereunder. Notwithstanding the above, Employee may
with the prior consent of the Board and prior written consent of the Chief
Executive Officer of the Company (such consent not to be unreasonably withheld)
pursue during his employment hereunder other business interests.

 

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2.           Compensation and Benefits.

 

For all services rendered by the Employee in any capacity during Employee’s
employment hereunder, 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 Employee
shall be compensated as follows:

 

(a)          Base Salary. The Company shall pay the Employee a fixed salary (the
“Base Salary”) in the gross amount of Three Hundred Thousand Dollars ($300,000)
per year. The Base Salary is subject to applicable deductions as required by law
or authorized in writing by the Employee. The Board may periodically review the
Base Salary with a view to increasing such Base Salary if, in the judgment of
the Board the Employee merits such an increase. Any increase in Base Salary
which has been approved by the Board shall constitute “Base Salary” hereunder. 
The Base Salary will be paid to the Employee in accordance with the customary
payroll practices of the Company.

 

(b)          Annual Bonus. Upon the conclusion of each Fiscal Year during the
Term, provided that the applicable Evaluation Criteria, as defined herein, have
been attained, the Employee shall be entitled to receive an annual bonus in the
amount of 40% of your Base Salary (the “Annual Bonus”). The “Fiscal Year” is the
period beginning on each January 1 and ending on the following December 31. In
order for the Employee to receive the Annual Bonus, the Evaluation Criteria as
established by the Board on the recommendation of the Compensation Committee of
the Board (the "Compensation Committee"), in consultation with the Company’s
Chief Executive Officer and the Employee, for each respective Fiscal Year mustbe
satisfied, such that eighty percent (80%) of the Annual Bonus shall be based
upon the Company’s corporate and financial performance goals during the
applicable Fiscal Year and twenty percent (20%) of the Annual Bonus shall be
based upon the Employee’s individual performance goals. As used herein, the term
“Evaluation Criteria” refers to such corporate, financial and/or individual
performance goals and objectives for each Fiscal Year as may be determined
within the first sixty (60) days such Fiscal Year by the CEO and Compensation
Committee in consultation with the Employee.

 

(c)          The Annual Bonus, if any, shall be paid to the Employee in a lump
sum, cash amount on or before March 15 following the end of the Fiscal Year to
which the Annual Bonus relates. If, before the end of such Fiscal Year, the
Employee’s employment with the Company is terminated by the Company without
Cause, or by the Employee for Good Reason, the Employee shall be entitled to
receive, at the time and in the manner set forth in the first sentence of this
subparagraph, a pro rata portion of the Annual Bonus that would have been
earned, if any, if the Employee had remained employed until the last day of the
Fiscal Year, such pro rata portion to be determined based upon the Employee’s
period of service during such Fiscal Year prior to the termination of
employment. If the Employee’s employment with the Company is terminated for any
other reason before the end of a Fiscal Year, the Employee will not have any
right to receive an Annual Bonus, or any portion thereof, for such Fiscal Year.

 

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(d)          Fringe Benefits, Option Grants and Miscellaneous Employment
Matters.

 

(i)          The Employee shall be entitled to participate in such employee
benefit plans or programs, including, without limitation, a Section 401(k)
retirement plan, of the Company established and amended and/or terminated from
time to time by the Board, available to other executives of the Company if any,
subject to the terms and conditions of such plans and programs.

 

(ii)         Except as otherwise provided herein, the Employee may be granted in
the sole and absolute discretion of the Board incentive and nonqualified stock
options (the “Employment Options”) on the last business day of each Fiscal Year
(provided the Employee is in the active employment of the Company on such day)
to purchase shares of the Company’s common stock (the “Common Stock”) with an
exercise price to be determined in the manner specified in the stock option or
equity incentive plan under which the grant is issued (which shall be no less
than the fair market value of the Common Stock on the date of grant). Any such
Employment Options shall be evidenced by a separate agreement between the
Company and the Employee, the terms of which will exclusively govern the
Employment Options. Notwithstanding the foregoing, with respect to any Fiscal
Year, the Company may grant in its sole and absolute discretion Employee a form
of equity award other than Employment Options, provided that any such award
shall have substantially similar vesting terms as the nonqualified stock options
described herein. Employee shall continue to have such rights (if any) to any
stock options granted previously by the Company, including but not limited to
the stock options granted to Employee on April 8, 2014 evidenced by the minutes
of the April 8, 2014 Board Meeting whereby Employee shall have the right to
purchase 1,540,800 shares of common stock upon the exercise of such options, in
accordance with the terms and conditions of any such options granted.

 

(e)          Withholding and Employment Tax. The Company will be entitled to
deduct and/or withhold from any amounts owing to Employee any federal, state,
city, local or foreign withholding taxes, excise taxes, or employment taxes
imposed with respect to Employee’s compensation or other payments from the
Company or Employee’s ownership interest in the Company (including, without
limitation, wages, bonuses, dividends, the receipt or exercise of options and/or
other equity interest).

 

(f)          Vacation. Employee shall receive four (4) weeks of paid vacation
annually, administered in accordance with the Company’s existing vacation
policy.

 

(g)          Company Policies.         Employee agrees to comply to the extent
not inconsistent with this Agreement with all personnel policies and procedures
of the Company as the same now exist or may be hereafter implemented by the
Company from time to time, including (without limitation) those policies
contained in the Company’s employee manual or handbook which sets forth policies
and procedures generally for employees of the Company.

 

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3.           Business Expenses.

 

The Company shall pay or reimburse all reasonable travel and entertainment
expenses incurred by the Employee in connection with the performance of his
duties under this Agreement, including such travel as may be required or
appropriate in your discretion, consistent with duly approved Company guidelines
and budgets, to fulfill the responsibilities of your office, all in accordance
with such 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.

 

4.           Termination of Employment.

 

Notwithstanding any other provision of this Agreement, Employee’s employment
with the Company may be terminated during the Term upon written notice to the
other Party as follows:

 

(a)          By the Company, in the event of the Employee’s death or Disability
(as hereinafter defined) or for Cause (as hereinafter defined). For purposes of
this Agreement, “Cause” shall mean: (i) the conviction of Employee of a crime
involving an act or acts of dishonesty, fraud or moral turpitude, which act or
acts constitute a felony; (ii) Employee’s refusal to perform the duties and
responsibilities required of him hereunder or (iii) Employee’s willfully
engaging in conduct that is, in the Board’s reasonable determination, materially
injurious to the Company or its affiliates (monetarily or otherwise). A
determination that Cause exists shall be made by at least a majority of the
members of the Board. Furthermore, the foregoing events or conditions will not
constitute Cause unless Company provides Employee with written notice of the
event or condition and fifteen (15) days to cure such event or condition (if
curable) and the event or condition is not cured within such 15-day period. For
purposes of this Agreement, “Disability” shall mean a determination that
Employee suffers from illness or other physical or mental impairment that
prevents Executive from substantially performing his duties for a period of 180
days during any consecutive 360-day period during the Term. The determination of
whether (and, if appropriate, when) a Disability has occurred shall be made by
two licensed physicians, one chosen by a majority of the Board and one chosen by
Employee (or his personal representative); provided, however, that if the two
physicians do not agree with respect to whether (or, if appropriate, when) a
Disability has occurred, such determination shall be made by a third licensed
physician chosen by said two physicians. The Company shall by written notice to
the Employee specify the event relied upon for termination pursuant to this
Section 4(a), and Employee’s employment hereunder shall be deemed terminated as
of the date set forth in such notice (such date having incorporated applicable
cure periods), except as otherwise set forth herein. In the event of the
expiration of the Term or any termination under Section 4(a), 4(b), 4(c)4(d) or
4(e) the Company shall pay, no later than fourteen (14) days following such
termination, all amounts then due to the Employee by the Company under Sections
2(a),2(b) and 2(c) of this Agreement for any portion of the payroll period
worked and/or any amounts earned but for which payment had not yet been made up
to the date of termination, any unreimbursed business expenses and any amounts
to which Employee is entitled under the Company’s benefit plans pursuant to
Section 2(d) hereof shall be paid in accordance with the applicable terms and
conditions of such plans. If such termination was for Cause or results from the
expiration of the Term, the Company shall have no further obligations to
Employee under this Agreement. The Company and Employee expressly agree that, to
the extent Employee’s employment terminates because of death, any amounts
payable shall be made to Employee’s estate, except to the extent otherwise
provided under the terms of the instrument pursuant to which any such amount is
paid.

 

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(b)          By the Company, in the absence of Cause, for any or no reason and
in its sole and absolute discretion, upon thirty (30) days prior written notice
to the Employee provided that in such event the Company shall pay to Employee
after the termination date (A) an amount equal to the monthly Base Salary (at a
monthly rate equal to the rate in effect immediately prior to the date of the
termination of the Employee’s employment) on the same schedule and in the same
manner as such payments would have been made in the absence of Employee’s
termination, for a period of six (6) months, and (B) COBRA premiums for the
Employee and his dependants under the Company’s employee benefit plans for a
period of twelve (12) months on the same schedule and in the same manner as such
payments would have been made in the absence of Employee’s termination
(together, the “No Cause Termination Payments”) provided the Release described
in paragraph (f) below has been executed and any revocation period for such
Release has expired (the “Release Date”). The first payment of the No Cause
Termination Payments shall be made on the first regular Company pay date that
occurs following the Release Date.

 

(c)          By the Employee for “Good Reason” following (i) a material breach
by the Company of the terms and provisions of this Agreement, (ii) a requirement
to relocate from Nashville, TN, (iii) a diminution in Employee’s title
authority, duties or responsibilities from title, authority, duty or
responsibilities consistent with the position of Executive Vice President, Chief
Commercial Officer of the Company. Resignation by Employee for Good Reason shall
be communicated by delivery to the Company of a written notice from Employee
stating that Employee shall resign for Good Reason, stating the particulars
thereof, and the effective date of the resignation being no later than 180 days
from the date of the delivery of the notice (and no sooner than 30 business
days). The Company shall have 30 days from the receipt of such notice to effect
a cure of the actions or conditions constituting Good Reason, if and to the
extent that such actions or conditions are subject to cure in the reasonable
judgment of the Board. Upon a cure or correction thereof by the Company, such
actions shall no longer constitute Good Reason for purposes of this Agreement
and Employee and Company shall agree and acknowledge in writing the cure of the
actions or conditions constituting Good Reason and Employee’s employment shall
continue pursuant to the terms of this Agreement uninterrupted. In the event of
a termination by the Employee for Good Reason, the Company shall pay, as
liquidated damages or severance pay, or both, to Employee the same Termination
Payments in accordance with the same terms and conditions as set forth in (b)
above.

 

Page 5 of 14

 

 

(d)         Employee may terminate his employment under this Agreement for no
reason upon thirty (30) days prior written notice to the Company.

 

(e)         In the event of Employee’s termination by the Company without Cause
or by the Employee for Good Reason within sixty (60) days prior to or during the
twelve (12)month period following the consummation of a Change of Control (as
defined below), then provided that the Release described in paragraph (f) below
has been executed, the Employee shall receive the following payments and
benefits:

 

(i)          a severance payment in an amount equal to the Employee’s annual
Base Salary in effect as of the termination date less applicable deductions and
withholdings, which amount shall be payable in a single lump sum within 30 days
after the termination date.

 

(ii)         a lump-sum payment in an amount equal to (A) the monthly COBRA
premium in effect under the Company’s group health plan as of the termination
date for the coverage in effect under such plan for the Employee (and his spouse
and dependents ) on such date multiplied by (B) 12, which amount shall be
payable in a single lump sum within 30 days after the termination date; and

 

(iii)        notwithstanding any provision to the contrary in any applicable
equity compensation plan or any outstanding equity award agreement, the
treatment of the Employee’s outstanding equity awards shall be governed solely
by the following provisions: (A) all of the Employee’s then-outstanding equity
awards shall fully vest and all restrictions thereon shall lapse, and (B) to the
extent vested, all of the Employee’s outstanding stock options shall remain
exercisable until the first to occur of 12 months following the termination date
and each such stock option’s original expiration date.

 

As used herein, the term “Change in Control” shall mean the occurrence of any of
the following circumstances after the date hereof: (i) any “person” (as such
term is used in Section 13(d) or 14(d) of the Securities Exchange Act of 1934
(“Exchange Act”)), other than a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or a corporation or other entity
owned directly or indirectly by the shareholders of the Company in substantially
the same proportions as their ownership of stock of the Company, shall have
become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing 30% or more of
the combined voting power of the Company’s then outstanding voting securities;
(ii) the Company is a party to a merger, consolidation, share exchange, sale of
assets or other reorganization, or a proxy contest, as a consequence of which
members of the Company’s Board of Directors (the “Board”) in office immediately
prior to such transaction or event constitute less than a majority of the Board
thereafter; or (iii) during any 15-month period, individuals who at the
beginning of such period constituted the Board (including for this purpose any
new director whose election or nomination for election by the Company’s
shareholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who were directors at the beginning of such
period) cease for any reason to constitute at least a majority of the Board.

 

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For the avoidance of doubt, the payments and benefits described under this
Section 4(e) shall be the only payments to which the Employee is entitled in the
event that the Employee’s employment terminates under this Section 4(e). Any
payments made to the Employee under Section 4(b) or 4(c) hereof shall offset
payments to which the Employee is otherwise entitled under this Section 4(e),
and vice versa.

 

(f)          Any other provision of this Agreement notwithstanding, the payments
and benefits to the Employee set forth in Subsection (b) and (d) of this Section
4 shall not be paid/provided unless the Employee (i) has timely executed and not
revoked a usual and customary general release of all known and unknown claims
that the Employee may then have against the Company or persons affiliated with
the Company in the form reasonably acceptable to the Company (the “Release”) and
(ii) has agreed not to prosecute any legal action or other proceeding based upon
any of such claims.

 

5.           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 affiliates. 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
affiliates. The Employee acknowledges that the proprietary information,
observations and data that will be 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 him 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. Employee shall not, without the prior written
consent of the Company, use, divulge, disclose or make accessible to any other
person, firm, partnership, corporation or other entity any Confidential
Information (as defined below) pertaining to the business of the Company or any
of its affiliates, except (i) while employed by the Company, in the business of
and for the benefit of the Company, or (ii) when required to do so by a court of
competent jurisdiction, by any governmental agency having supervisory authority
over the business of the Company, or by any administrative body or legislative
body (including a committee thereof) with jurisdiction to order Employee to
divulge, disclose or make accessible such information. “Confidential
Information” shall mean non-public information concerning the financial data,
strategic business plans, product development (or other proprietary product
data), customer lists, marketing plans and other non-public, proprietary and
confidential information of the Company or its affiliates (hereinafter referred
to as the “Protected Group”) or the Company's existing or potential customers.
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.

 

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6.           Restrictive Covenants

 

(a)          Noncompete. During the period of Employee’s employment hereunder
and six (6) months thereafter (“Non-Competition Period”), the Employee 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 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, as defined herein, (unless the Board shall have
authorized such activity and the Company shall have consented thereto in
writing). The term “Business Engaged In by the Company” shall mean any person or
entity engaged in (i) the use of products or technology similar to the Company’s
platelet rich plasma platform technology, including the Angel® Whole Blood
Separation System and the AutoloGelTM System as well as the ALDH bright
cell-based therapies, (ii) any use of products or technology competitive with
those which the Company is actively developing during the Term, or (iii) the
direct competition with either (i) or (ii) above. Investments in less than 5% 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.

 

Employee and the Company agree that this covenant not to compete is a reasonable
covenant under the circumstances, and further agree that if in the opinion of
any court of competent jurisdiction such restraint is not reasonable in any
respect, such court shall have the right, power and authority to excise or
modify such provision or provisions of this covenant as to the court shall
appear not reasonable and to enforce the remainder of the covenant as so
modified. Employee agrees that any breach of the covenants contained in this
Exhibit A would irreparably injure the Company. Accordingly, Employee agrees
that the Company may, in addition to pursuing any other remedies it or they may
have in law or in equity, cease making any payments otherwise required by this
Agreement and obtain an injunction against Employee from any court having
jurisdiction over the matter restraining any further violation of this Agreement
by Employee.

 

(b)           Non-solicitation. Employee agrees that for the term of his
employment with the Company and for the period of six (6) months after the
termination of Employee’s employment with the Company, he shall not, except with
the prior written consent of the Company signed by the CEO, solicit, any persons
or entities who are members of the Company as of the date of this Agreement or
any persons or entities who hereafter become members of the Company.

 

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(c)          Non-Disparagement.   Employee agrees that he will not, directly or
indirectly, individually or in concert with others, engage in any conduct or
make any statement that is likely to have the effect of undermining or
disparaging the reputation of the Company or any member of the Protected Group,
or their good will, products, or business opportunities, or that is likely to
have the effect of undermining or disparaging the reputation of any officer,
director, agent, representative or employee, past or present, of the Company or
any member of the Protected Group. The Company agrees that it shall not,
directly or indirectly, engage in any conduct or make any statement that is
likely to have the effect of undermining or disparaging the reputation of
Employee.

 

(d)          Notification to New Employer. In the event that Employee leaves the
employ of the Company, Employee hereby gives his consent to notification by the
Company to his new employer about Employee's obligations under this Agreement,
including providing such new employer a copy of this Agreement. The Company
shall provide Employee a copy of such written notification (if any) given to
Employee's new employer pursuant to the immediately preceding sentence. Employee
hereby agrees to provide (prior to his commencement of employment with such new
employer) any such new employer a copy of this Agreement.

 

(e)          Property of the Company. Employee agrees that all records, files,
memoranda, reports, client lists, programs, work product, or any other similar
records or documents relating to the Company's business (including without
limitation those which may have been used or prepared by Employee, whether or
not part of the Confidential Information), remain the sole personal property of
the Company and remain at all times, both during and after Employee's employment
with the Company, in the control of the Company. Employee hereby waives and
releases all claims of right of ownership thereto and Employee hereby agrees
that upon the termination of his employment with the Company for any reason
whatsoever, Employee shall immediately surrender all such records and documents,
and all copies thereof, together with any other property of the Company in
Employee's possession, to the Company at its principal business office or such
other location as directed by the Company.

 

7.           Dispute Resolution.

 

All disputes between the Parties arising from the construction or performance
of, or otherwise in connection with this Agreement, shall be finally settled in
Maryland, before one arbitrator appointed by agreement between the parties
pursuant to the rules of the American Arbitration Association. If the parties
cannot agree on an arbitrator then such arbitrator shall be appointed by the
American Arbitration Association. The arbitration procedure and all decisions
made by the arbitrator shall be kept confidential, unless the Parties expressly
consent to the publication thereof in whole or in part. Unless oral hearings are
requested by a party, the arbitrator shall make his/her award on the basis of
written submissions. In the event of any proceeding between the Company and the
Employee with respect to the subject matter of this Agreement and the
enforcement of the rights hereunder and such proceeding results in final
judgment or order in favor of one of the Parties, which judgment or order is
substantially inconsistent with the positions asserted by the other Party in
such litigation or proceeding, the losing Party in such event shall reimburse
the prevailing Party for all of its reasonable costs and expenses relating to
such litigation or other proceeding, including, without limitation, its
reasonable attorneys’ fees and expenses. Such payments shall be made no later
than sixty (60) days after the final judgment or order is entered.

 

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8.           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 business combination
provided that the entity 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 in accordance with its terms and shall
entitle the Employee and his heirs, beneficiaries and representatives to
substantially the same compensation, benefits, 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.

 

9.           Survival of Obligations.

 

Sections 2(c), 2(e), 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18,
19, 20 and 21 shall survive the termination for any reason of this Agreement
(whether such termination is by the Company, by the Employee, upon the
expiration of this Agreement or otherwise).

 

10.         Employee’s Representations.

 

The Employee hereby represents and warrants to the Company that (i) the
execution, delivery and performance of this Agreement by the Employee do not and
shall not materially conflict with, breach, violate or cause a default under any
contract, agreement, instrument, order, judgment or decree to which the Employee
is a party or by which he is bound, (ii) the Employee 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 and the Employee, this Agreement shall be the
valid and binding obligation of the Employee, enforceable in accordance with its
terms. The Employee 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.

 

11.         Company’s Representations.

 

The Company hereby represents and warrants to the Employee that (i) the
execution, delivery and performance of this Agreement by the Company do not and
shall not materially 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 and (ii) upon the execution and delivery of
this Agreement by the Employee and the Company, this Agreement shall be the
valid and binding obligation of the Company, enforceable in accordance with its
terms.

 

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12.         Enforcement.

 

Because the Employee’s services are unique and because the Employee has access
to Confidential Information concerning the Company, the parties hereto agree
that money damages alone may not be an adequate remedy for any breach of this
Agreement. In the event of a breach or threatened breach of this Agreement,
either party may, in addition to other rights and remedies existing in its
favor, apply to any court of competent jurisdiction in Maryland for injunctive
relief in order to enforce, or prevent any violations of, the provisions hereof
(without posting a bond or other security).

 

13.         Severability.

 

In case any one or more of the provisions or part(s) of provisions 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. 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.

 

14.         Entire Agreement; Amendment; Indemnification; Fees.

 

(a)          Entire Agreement. Except as otherwise set forth in this Agreement,
this Agreement contains the entire agreement between the Company and the
Employee with respect to the subject matter hereof and thereof and supersedes
and nullifies all previous agreements between the parties about the Company’s
employment of the Employee. 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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(b)          Indemnification. The Company shall enter into an Indemnification
Agreement with Employee that is customary for an executive officer of a public
reporting company and in the same form as provided to the members of the Board
of Directors.

 

(c)          Reimbursement. The Company will reimburse Employee an amount not to
exceed $7,500 for legal fees relating to the review of this Agreement by counsel
on behalf of Employee.

 

15.         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 overnight mail or other expedited service and contains tracking
information to show delivery or upon receipt if mailed, postage prepaid, via
registered mail, return receipt requested, addressed as follows:

 

(a) To the Company: (b) To the Employee:           Cytomedix, Inc.   Dean Tozer
  209 Perry Parkway, Suite 7       Gaithersburg, MD 20877       Attn: Chairman
of the Compensation Committee               and to:   and to:           Alec
Orudjev, Esq. Kolin B. Holladay, Esq.   Schiff Hardin LLP Adams and Reese LLP  
901 K Street, NW, Suite 700 424 Church Street, Suite 2700           Washington,
DC 20001 Nashville, Tennessee 37219

 

and/or to such other persons and addresses as any party shall have specified in
writing to the other.

 

16.         Assignability.

 

This Agreement shall be assignable by the Company but not the Employee, and
shall be binding upon, and shall inure to the benefit of, the heirs, executors,
administrators, legal representatives, successors and permitted assigns of the
parties. This Agreement shall inure to the benefit of and be enforceable by the
Employee’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.

 

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17.         Governing Law.

 

This Agreement shall be governed by and construed under the laws of the State of
Delaware.

 

18.         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.

 

19.         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.

 

20.         Section 409A of the Internal Revenue Code.

 

Each payment under this Agreement is intended to be exempt from Section 409A of
the Internal Revenue Code of 1986, as amended (the “Code”) or in compliance with
Code Section 409A, and the provisions of this Agreement will be administered,
interpreted and construed accordingly. Without limiting the generality of the
foregoing, the term “termination of employment” or any similar term under this
Agreement will be interpreted to mean “separation from service” within the
meaning of Code Section 409A to the extent necessary to comply with Code Section
409A. Furthermore, the right to a series of installment payments or in-kind
benefits under this Agreement is to be treated as a right to a series of
separate payments for purposes of Code Section 409A.

 

Notwithstanding anything in this Agreement to the contrary, for any year in
which the stock of the Company is tradable on an established securities market,
and the Employee meets the requirements of Code Section 416(i)(1)(A)(i), (ii),
or (iii) (applied in accordance with the regulations thereunder, but without
regard to Code Section 416(i)(5)) at any time during the 12 month period ending
on the last occurring December 31st (and is therefore a “Specified Employee”),
then, to the extent required by Code Section 409A, and the final regulations
thereunder, the Company shall pay any benefit which constitutes “deferred
compensation” under this Agreement within the meaning of the Code Section 409A
no earlier than the earliest of the following:

 

(1)the expiration of the six month period (the “Deferral Period”) measured from
the date of the Employee’s ‘separation from service’ under Code Section 409A; or

 

(2)the date of the Employee’s death.

 

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Upon the expiration of the Deferral Period, all payments that would have been
made during the Deferral Period (whether in a single lump sum or in
installments) shall be paid as a single lump sum to the Employee or, if
applicable, his or her beneficiary. This section shall not apply to any payment
which constitutes “separation pay” as described in Treasury Regulation
1.409A-1(b)(9)(iii).

 

To the extent required by Code Section 409A, with regard to any provision that
provides for the reimbursement of costs and expenses, or for the provision of
in-kind benefits:

 

(1)The right to such reimbursement or in-kind benefit shall not be subject to
liquidation or exchange for another benefit;

 

(2)The amount of expenses or in kind benefits available or paid in one year
shall not affect the amount available or paid in any subsequent year; and

 

(3)Such payments shall be made on or before the last day of the Employee’s
taxable year following the taxable year in which the expense occurred.

 

21.         Code Section 280G

 

Notwithstanding anything contained in this Agreement to the contrary, to the
extent that any of the payments and benefits provided for under this Agreement,
together with any payments or benefits under any other agreement or arrangement
between the Company or any of their subsidiaries or affiliates and Employee
(collectively, the “Payments”) would constitute a “parachute payment” within the
meaning of Section 280G of the Code, Employee shall receive total payments equal
to the greater, after the application of the excise tax imposed pursuant to
Section 4999 of the Code, of the Payments provided under this Agreement or the
amount of such Payments reduced to the greatest amount that would result in no
portion of the Payments being subject to such excise tax.

 

IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
as of the date first above written.

 

  COMPANY:       CYTOMEDIX, INC.

 

  By: /s/ Martin Rosendale       Martin Rosendale       Chief Executive Officer
              EMPLOYEE:               /s/ Dean Tozer       Dean Tozer  

 

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