Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement (“Agreement”) is made as of the 6th day of November,
2014, between Aastrom Biosciences, Inc., a Michigan corporation (the “Company”),
and Gerard Michel (the “Executive”).

 

WHEREAS, the Company desires to continue to employ the Executive and the
Executive desires to continue to be employed by the Company on the terms
contained herein.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties agree as follows:

 

1.             Position and Duties.  The Executive shall serve as Chief
Financial Officer and VP Corporate Development, and shall have such other powers
and duties as may from time to time be prescribed by the Chief Executive Officer
of the Company (the “CEO”) or other authorized executive, provided that such
duties are consistent with the Executive’s position or other positions that he
may hold from time to time.  The Executive shall devote his full working time
and efforts to the business and affairs of the Company.  Notwithstanding the
foregoing, the Executive may engage in religious, charitable or other community
activities as long as such services and activities are disclosed to the Company
and do not materially interfere with the Executive’s performance of his duties
to the Company as provided in this Agreement.  The first day of Executive’s
employment with the Company was June 2, 2014 and shall be referred to herein as
the “Start Date”.

 

2.             Compensation and Related Matters.

 

(a)           Base Salary.  The Executive’s annual base salary rate shall be
$350,000.  The Executive’s base salary shall be reviewed annually by the
Company. The base salary in effect at any given time is referred to herein as
“Base Salary.”  The Base Salary shall be payable in a manner that is consistent
with the Company’s usual payroll practices for senior employees.

 

(b)           Incentive Compensation.  The Executive shall be eligible to
receive cash incentive compensation as determined by the Company from time to
time.  The Executive’s target annual incentive compensation shall be forty
percent (40%) of his Base Salary with the actual amount to be determined by the
Company in its discretion.  To be eligible for an incentive compensation
payment, the Executive must be employed by the Company on the day such incentive
compensation is paid.

 

(c)           Options.  In connection with the commencement of Executive’s
employment, the Company granted Executive 45,000 options to purchase shares of
the Company’s common stock at an exercise price equal to the fair market value
of the Company’s common stock on the effective date of grant. Such options

 

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are subject to the terms and conditions of the Company’s 2009 Stock Option Plan,
as may be amended and/or restated from time to time, and the associated stock
option agreement (collectively with any such other similar equity plan and form
of stock option agreement, in each case duly adopted by the Company, the “Equity
Documents”).  Subject to approval by the Company’s Board of Directors, the
Company may grant Executive additional options or other equity grants in its
discretion.  All equity grants shall be governed by the Equity Documents.

 

(d)           Commuting Expenses.  The Company will reimburse Executive for
reasonable travel and lodging expenses incurred in connection with Executive’s
commute to Boston during the period starting on the State Date and ending on
earlier of:  (i) fifteen (15) months from the Start Date; or (ii) the date
Executive relocates to the Boston area, provided in no event shall such travel
and lodging expenses exceed $30,000 of actual expenses.

 

(e)           Relocation Reimbursement.  Executive agrees to relocate to the
Boston area within 15 months of the Start Date.  Upon Executive’s relocation to
the Boston area during this period (the “Relocation Date”), he will be eligible
for reimbursement of relocation expenses including temporary housing, moving
expenses, closing costs associated with selling Executive’s current home and
purchasing a new residence in the Boston area and other reasonable move-related
items (collectively “Relocation Expenses”) in accordance with the Company’s
expense reimbursement policy, including provisions relating maximum amounts and
appropriate supporting documentation (i.e., itemized receipts).  If Executive
resigns other than for Good Reason (defined below) or is terminated by the
Company for Cause (defined below) at any time prior to the one year anniversary
of the Relocation Date, Executive must repay all relocation expenses to the
Company within ten (10) days of the Date of Termination (defined below) (the
“Relocation Reimbursement”).

 

(f)            Tax Reporting.  The Company will determine in its reasonable,
good faith judgment what, if any, of Executive’s reimbursed travel and lodging
and relocation expenses are for nondeductible expenses in accordance with
applicable law and will comply with associated withholding and tax reporting
obligations.

 

(g)           Business Expenses.  The Executive shall be entitled to receive
prompt reimbursement for all reasonable business expenses incurred by him in
performing services hereunder, in accordance with the policies and procedures
then in effect and established by the Company for its senior executive officers.

 

(h)           Other Benefits.  The Executive shall be entitled to continue to
participate in or receive benefits under all of the Company’s employee benefit
plans and programs, as may be in effect from time to time, subject to the terms
and conditions of such plans and programs.

 

(i)            Paid Time Off.  The Executive shall be entitled to accrue up to
twenty-five (25) days of paid time off in each year, which shall be accrued
ratably at

 

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the rate of 16.67 hours per month.  The Executive shall also be entitled to all
paid holidays given by the Company to its executives.

 

3.             Termination.  The Executive’s employment hereunder may be
terminated without any breach of this Agreement under the following
circumstances:

 

(a)           Death.  The Executive’s employment hereunder shall terminate upon
his death.

 

(b)           Disability.  The Company may terminate the Executive’s employment
if he is disabled and unable to perform the essential functions of the
Executive’s then existing position or positions under this Agreement with or
without reasonable accommodation for a period of 180 days (which need not be
consecutive) in any 12-month period.  If any question shall arise as to whether
during any period the Executive is disabled so as to be unable to perform the
essential functions of the Executive’s then existing position or positions with
or without reasonable accommodation, the Executive may, and at the request of
the Company shall, submit to the Company a certification in reasonable detail by
a physician selected by the Company to whom the Executive or the Executive’s
guardian has no reasonable objection as to whether the Executive is so disabled
or how long such disability is expected to continue, and such certification
shall for the purposes of this Agreement be conclusive of the issue.  The
Executive shall cooperate with any reasonable request of the physician in
connection with such certification.  If such question shall arise and the
Executive shall fail to submit such certification, the Company’s determination
of such issue shall be binding on the Executive.  Nothing in this Section 3(b)
shall be construed to waive the Executive’s rights, if any, under existing laws
including, without limitation, the Family and Medical Leave Act of 1993, 29
U.S.C. §2601 et seq. and the Americans with Disabilities Act, 42 U.S.C. §12101
et seq.

 

(c)           Termination by Company for Cause.  The Company may terminate the
Executive’s employment hereunder for Cause. For purposes of this Agreement,
“Cause” shall mean: (i) conduct by the Executive constituting a material act of
misconduct in connection with the performance of his duties, including, without
limitation, misappropriation of funds or property of the Company or any of its
subsidiaries or affiliates other than the occasional, customary and de minimis
use of Company property for personal purposes; (ii) the commission by the
Executive of any felony or a misdemeanor involving moral turpitude, deceit,
dishonesty or fraud, or any conduct by the Executive that would reasonably be
expected to result in material injury or reputational harm to the Company or any
of its subsidiaries and affiliates if he were retained in his position; (iii)
continued unsatisfactory performance or non-performance by the Executive of his
duties hereunder (other than by reason of the Executive’s physical or mental
illness, incapacity or disability) which has continued for more than 15 days
following written notice from the CEO of such unsatisfactory performance or such
non-performance; (iv) a breach by the Executive of any of the provisions
contained in Section 6 of this Agreement; (v) a material violation by the
Executive of the Company’s written employment policies, or (vi) failure to
cooperate with a bona fide internal investigation or an investigation by

 

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regulatory or law enforcement authorities, after being instructed by the Company
to cooperate, or the willful destruction or failure to preserve documents or
other materials known to be relevant to such investigation or the inducement of
others to fail to cooperate or to produce documents or other materials in
connection with such investigation.

 

(d)           Termination Without Cause.  The Company may terminate the
Executive’s employment hereunder at any time without Cause.  Any termination by
the Company of the Executive’s employment under this Agreement which does not
constitute a termination for Cause under Section 3(c) and does not result from
the death or disability of the Executive under Section 3(a) or (b) shall be
deemed a termination without Cause.

 

(e)           Termination by the Executive.  The Executive may terminate his
employment hereunder at any time for any reason, including but not limited to
Good Reason. For purposes of this Agreement, “Good Reason” shall mean that the
Executive has complied with the “Good Reason Process” (hereinafter defined)
following the occurrence of any of the following events: (i) a material
diminution in the Executive’s responsibilities, authority or duties; (ii) a
material diminution in the Executive’s Base Salary except for across-the-board
salary reductions based on the Company’s financial performance similarly
affecting all or substantially all senior management employees of the Company;
or (iii) the material breach of this Agreement by the Company.  “Good Reason
Process” shall mean that (i) the Executive reasonably determines in good faith
that a “Good Reason” condition has occurred; (ii) the Executive notifies the
Company in writing of the first occurrence of the Good Reason condition within
15 days of the first occurrence of such condition; (iii) the Executive
cooperates in good faith with the Company’s efforts, for a period not less than
15 days following such notice (the “Cure Period”), to remedy the condition; (iv)
notwithstanding such efforts, the Good Reason condition continues to exist; and
(v) the Executive terminates his employment within 15 days after the end of the
Cure Period. If the Company cures the Good Reason condition during the Cure
Period, Good Reason shall be deemed not to have occurred.

 

(f)            Notice of Termination.  Except for termination as specified in
Section 3(a), any termination of the Executive’s employment by the Company or
any such termination by the Executive shall be communicated by written Notice of
Termination to the other party hereto.  For purposes of this Agreement, a
“Notice of Termination” shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon.

 

(g)           Date of Termination.  “Date of Termination” shall mean: (i) if the
Executive’s employment is terminated by his death, the date of his death; (ii)
if the Executive’s employment is terminated on account of disability under
Section 3(b) or by the Company for Cause under Section 3(c), the date on which
Notice of Termination is given; (iii) if the Executive’s employment is
terminated by the Company without Cause under Section 3(d), on the date on which
a Notice of Termination is given; (iv) if the Executive’s employment is
terminated by the

 

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Executive under Section 3(e) without Good Reason, 30 days on the date on which a
Notice of Termination is given, and (v) if the Executive’s employment is
terminated by the Executive under Section 3(e) with Good Reason, the date on
which a Notice of Termination is given after the end of the Cure Period. 
Notwithstanding the foregoing, in the event that the Executive gives a Notice of
Termination to the Company, the Company may unilaterally accelerate the Date of
Termination and such acceleration shall not result in a termination by the
Company for purposes of this Agreement.

 

4.             Compensation Upon Termination.

 

(a)           Termination Generally.  If the Executive’s employment with the
Company is terminated for any reason, the Company shall pay or provide to the
Executive (or to his authorized representative or estate) any earned but unpaid
base salary, incentive compensation earned but not yet paid, unpaid expense
reimbursements, accrued but unused paid-time-off and any vested benefits the
Executive may have under any employee benefit plan of the Company (the “Accrued
Benefit”) on or before the time required by law but in no event more than 30
days after the Executive’s Date of Termination.

 

(b)           Termination by the Company Without Cause or by the Executive with
Good Reason.  If the Executive’s employment is terminated by the Company without
Cause as provided in Section 3(d), or the Executive terminates his employment
for Good Reason as provided in Section 3(e), then the Company shall, through the
Date of Termination, pay the Executive his Accrued Benefit. In addition:

 

(i)            subject to the Executive signing a separation agreement including
a general release of claims in favor of the Company and related persons and
entities in a form and manner satisfactory to the Company (the “Release”) within
the time period set forth in the Release, the Company shall pay the Executive an
amount equal to nine (9) months of the Executive’s Base Salary (the “Severance
Amount”).  The Severance Amount shall be paid out in substantially equal
installments in accordance with the Company’s payroll practice over nine (9)
months, beginning on the first payroll date that occurs 30 days after the Date
of Termination.  Solely for purposes of Section 409A of the Internal Revenue
Code of 1986, as amended (the “Code”), each installment payment is considered a
separate payment. Notwithstanding the foregoing, if the Executive breaches any
of the provisions contained in Section 6 of this Agreement, all payments of the
Severance Amount shall immediately cease; and

 

(ii)           subject to the Executive’s copayment of premium amounts at the
active employees’ rate, the Executive may continue to participate in the
Company’s group health, dental and vision program for nine (9) months; provided,
however, that the continuation of health benefits under this Section shall only
apply if Executive elects and remains eligible under the Consolidated Omnibus
Budget Reconciliation Act of 1985, as amended (“COBRA”).

 

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5.             Section 409A.

 

(a)           Anything in this Agreement to the contrary notwithstanding, if at
the time of the Executive’s separation from service within the meaning of
Section 409A of the Code, the Company determines that the Executive is a
“specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code,
then to the extent any payment or benefit that the Executive becomes entitled to
under this Agreement on account of the Executive’s separation from service would
be considered deferred compensation subject to the 20 percent additional tax
imposed pursuant to Section 409A(a) of the Code as a result of the application
of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and
such benefit shall not be provided until the date that is the earlier of (A) six
months and one day after the Executive’s separation from service, or (B) the
Executive’s death.  If any such delayed cash payment is otherwise payable on an
installment basis, the first payment shall include a catch-up payment covering
amounts that would otherwise have been paid during the six-month period but for
the application of this provision, and the balance of the installments shall be
payable in accordance with their original schedule.

 

(b)           All in-kind benefits provided and expenses eligible for
reimbursement under this Agreement shall be provided by the Company or incurred
by the Executive during the time periods set forth in this Agreement.  All
reimbursements shall be paid as soon as administratively practicable, but in no
event shall any reimbursement be paid after the last day of the taxable year
following the taxable year in which the expense was incurred.  The amount of
in-kind benefits provided or reimbursable expenses incurred in one taxable year
shall not affect the in-kind benefits to be provided or the expenses eligible
for reimbursement in any other taxable year.  Such right to reimbursement or
in-kind benefits is not subject to liquidation or exchange for another benefit.

 

(c)           To the extent that any payment or benefit described in this
Agreement constitutes “non-qualified deferred compensation” under Section 409A
of the Code, and to the extent that such payment or benefit is payable upon the
Executive’s termination of employment, then such payments or benefits shall be
payable only upon the Executive’s “separation from service.”  The determination
of whether and when a separation from service has occurred shall be made in
accordance with the presumptions set forth in Treasury Regulation Section
1.409A-1(h).

 

(d)           The parties intend that this Agreement will be administered in
accordance with Section 409A of the Code.  To the extent that any provision of
this Agreement is ambiguous as to its compliance with Section 409A of the Code,
the provision shall be read in such a manner so that all payments hereunder
comply with Section 409A of the Code.  The parties agree that this Agreement may
be amended, as reasonably requested by either party, and as may be necessary to
fully comply with Section 409A of the Code and all related rules and regulations
in order to preserve the payments and benefits provided hereunder without
additional cost to either party.

 

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(e)           The Company makes no representation or warranty and shall have no
liability to the Executive or any other person if any provisions of this
Agreement are determined to constitute deferred compensation subject to Section
409A of the Code but do not satisfy an exemption from, or the conditions of,
such Section.

 

6.             Confidential Information, Noncompetition and Cooperation.

 

(a)           Confidential Information.  As used in this Agreement,
“Confidential Information” means information belonging to the Company which is
of value to the Company in the course of conducting its business and the
disclosure of which could result in a competitive or other disadvantage to the
Company. Confidential Information includes, without limitation, financial
information, reports, and forecasts; inventions, improvements and other
intellectual property; trade secrets; know-how; designs, processes or formulae;
software; market or sales information or plans; customer lists; and business
plans, prospects and opportunities (such as possible acquisitions or
dispositions of businesses or facilities) which have been discussed or
considered by the management of the Company.  Confidential Information includes
information developed by the Executive in the course of the Executive’s
employment by the Company, as well as other information to which the Executive
may have access in connection with the Executive’s employment.  Confidential
Information also includes the confidential information of others with which the
Company has a business relationship.  Notwithstanding the foregoing,
Confidential Information does not include information in the public domain,
unless due to breach of the Executive’s duties under Section 6(b).

 

(b)           Confidentiality.  The Executive understands and agrees that the
Executive’s employment creates a relationship of confidence and trust between
the Executive and the Company with respect to all Confidential Information.  At
all times, both during the Executive’s employment with the Company and after its
termination, the Executive will keep in confidence and trust all such
Confidential Information, and will not use or disclose any such Confidential
Information without the written consent of the Company, except as may be
necessary in the ordinary course of performing the Executive’s duties to the
Company.

 

(c)           Documents, Records, etc.  All documents, records, data, apparatus,
equipment and other physical property, whether or not pertaining to Confidential
Information, which are furnished to the Executive by the Company or are produced
by the Executive in connection with the Executive’s employment will be and
remain the sole property of the Company.  The Executive will return to the
Company all such materials and property as and when requested by the Company. 
In any event, the Executive will return all such materials and property
immediately upon termination of the Executive’s employment for any reason.  The
Executive will not retain with the Executive any such material or property or
any copies thereof after such termination.

 

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(d)           Noncompetition and Nonsolicitation.  During the Executive’s
employment with the Company and for twelve (12) months thereafter, regardless of
the reason for the ending of Executive’s employment, the Executive (i) will not,
directly or indirectly, whether as owner, partner, shareholder, consultant,
agent, employee, co-venturer or otherwise, engage, participate, assist or invest
in any Competing Business (as hereinafter defined); (ii) will refrain from
directly or indirectly employing, attempting to employ, recruiting or otherwise
soliciting, inducing or influencing any person to leave employment with the
Company (other than terminations of employment of subordinate employees
undertaken in the course of the Executive’s employment with the Company); and
(iii) will refrain from soliciting or encouraging any customer or supplier to
terminate or otherwise modify adversely its business relationship with the
Company.  The Executive understands that the restrictions set forth in this
Section 6(d) are intended to protect the Company’s interest in its Confidential
Information and established employee, customer and supplier relationships and
goodwill, and agrees that such restrictions are reasonable and appropriate for
this purpose.  For purposes of this Agreement, the term “Competing Business”
shall mean an autologous or allogeneic cell therapy technology business focused
on the development of therapies for the treatment of severe, chronic
cardiovascular diseases conducted anywhere in the world which is competitive
with the business which the Company or any of its affiliates at any time during
the employment of the Executive.  Notwithstanding the foregoing, the Executive
may own up to one percent (1%) of the outstanding stock of a publicly held
corporation which constitutes or is affiliated with a Competing Business.

 

(e)           Third-Party Agreements and Rights.  The Executive hereby confirms
that the Executive is not bound by the terms of any agreement with any previous
employer or other party which restricts in any way the Executive’s use or
disclosure of information or the Executive’s engagement in any business.  The
Executive represents to the Company that the Executive’s execution of this
Agreement, the Executive’s employment with the Company and the performance of
the Executive’s proposed duties for the Company will not violate any obligations
the Executive may have to any such previous employer or other party.  In the
Executive’s work for the Company, the Executive will not disclose or make use of
any information in violation of any agreements with or rights of any such
previous employer or other party, and the Executive will not bring to the
premises of the Company any copies or other tangible embodiments of non-public
information belonging to or obtained from any such previous employment or other
party.

 

(f)            Litigation and Regulatory Cooperation.  During and after the
Executive’s employment, the Executive shall cooperate fully with the Company in
the defense or prosecution of any claims or actions now in existence or which
may be brought in the future against or on behalf of the Company which relate to
events or occurrences that transpired while the Executive was employed by the
Company. The Executive’s full cooperation in connection with such claims or
actions shall include, but not be limited to, being available to meet with
counsel to prepare for discovery or trial and to act as a witness on behalf of
the Company at mutually convenient times. During and after the Executive’s
employment, the Executive also shall cooperate

 

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fully with the Company in connection with any investigation or review of any
federal, state or local regulatory authority as any such investigation or review
relates to events or occurrences that transpired while the Executive was
employed by the Company. The Company shall reimburse the Executive for any
reasonable out-of-pocket expenses incurred in connection with the Executive’s
performance of obligations pursuant to this Section 6(f).

 

(g)           Injunction.  The Executive agrees that it would be difficult to
measure any damages caused to the Company which might result from any breach by
the Executive of the promises set forth in this Section 6, and that in any event
money damages would be an inadequate remedy for any such breach.  Accordingly,
subject to Section 7 of this Agreement, the Executive agrees that if the
Executive breaches, or proposes to breach, any portion of this Agreement, the
Company shall be entitled, in addition to all other remedies that it may have,
to an injunction or other appropriate equitable relief to restrain any such
breach without showing or proving any actual damage to the Company.

 

7.             Arbitration of Disputes.  Any controversy or claim arising out of
or relating to this Agreement or the breach thereof or otherwise arising out of
the Executive’s employment or the termination of that employment (including,
without limitation, any claims of unlawful employment discrimination whether
based on age or otherwise) shall, to the fullest extent permitted by law, be
settled by arbitration in any forum and form agreed upon by the parties or, in
the absence of such an agreement, under the auspices of the American Arbitration
Association (“AAA”) in Detroit, Michigan in accordance with the Employment
Dispute Resolution Rules of the AAA, including, but not limited to, the rules
and procedures applicable to the selection of arbitrators. In the event that any
person or entity other than the Executive or the Company may be a party with
regard to any such controversy or claim, such controversy or claim shall be
submitted to arbitration subject to such other person or entity’s agreement.
Judgment upon the award rendered by the arbitrator may be entered in any court
having jurisdiction thereof.  This Section 7 shall be specifically enforceable.
Notwithstanding the foregoing, this Section 7 shall not preclude either party
from pursuing a court action for the sole purpose of obtaining a temporary
restraining order or a preliminary injunction in circumstances in which such
relief is appropriate; provided that any other relief shall be pursued through
an arbitration proceeding pursuant to this Section 7.

 

8.             Consent to Jurisdiction.  To the extent that any court action is
permitted consistent with or to enforce Section 7 of this Agreement, the parties
hereby consent to the jurisdiction of the Superior Court of the State of
Michigan and the United States District Court for the District of Michigan.
Accordingly, with respect to any such court action, the Executive (a) submits to
the personal jurisdiction of such courts; (b) consents to service of process;
and (c) waives any other requirement (whether imposed by statute, rule of court,
or otherwise) with respect to personal jurisdiction or service of process.

 

9.             Integration.  This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes all
prior agreements between the parties concerning such subject matter, including
without limitation the May 13, 2014 offer letter provided the Employee
Proprietary Information Nondisclosure and Assignment of Intellectual

 

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Property Agreement you entered into on June 3, 2014, the Acknowledgment
regarding the Statement of Company Policy on Insider Trading and Disclosure
dated June 3, 2014, the Acknowledgment of the Statement of Company Policy on the
Code of Business Conduct and Ethics dated June 3, 2014 and the Company’s
Colleague Handbook Acknowledgment dated June 3, 2014 all remain in full force
and effect.

 

10.          Withholding.  All payments made by the Company to the Executive
under this Agreement shall be net of any tax or other amounts required to be
withheld by the Company under applicable law.

 

11.          Successor to the Executive.  This Agreement shall inure to the
benefit of and be enforceable by the Executive’s personal representatives,
executors, administrators, heirs, distributees, devisees and legatees. In the
event of the Executive’s death after his termination of employment but prior to
the completion by the Company of all payments due him under this Agreement, the
Company shall continue such payments to the Executive’s beneficiary designated
in writing to the Company prior to his death (or to his estate, if the Executive
fails to make such designation).

 

12.          Enforceability.  If any portion or provision of this Agreement
(including, without limitation, any portion or provision of any section of this
Agreement) shall to any extent be declared illegal or unenforceable by a court
of competent jurisdiction, then the remainder of this Agreement, or the
application of such portion or provision in circumstances other than those as to
which it is so declared illegal or unenforceable, shall not be affected thereby,
and each portion and provision of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.

 

13.          Survival.  The provisions of this Agreement shall survive the
termination of this Agreement and/or the termination of the Executive’s
employment to the extent necessary to effectuate the terms contained herein.

 

14.          Waiver.  No waiver of any provision hereof shall be effective
unless made in writing and signed by the waiving party.  The failure of any
party to require the performance of any term or obligation of this Agreement, or
the waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.

 

15.          Notices.  Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by a nationally recognized overnight courier service or by
registered or certified mail, postage prepaid, return receipt requested, to the
Executive at the last address the Executive has filed in writing with the
Company or, in the case of the Company, at its main offices, attention of the
Board.

 

16.          Amendment.  This Agreement may be amended or modified only by a
written instrument signed by the Executive and by a duly authorized
representative of the Company.

 

17.          Governing Law.  This is a Michigan contract and shall be construed
under and be governed in all respects by the laws of the State of Michigan,
without giving effect to the conflict of laws principles of such State.  With
respect to any disputes concerning federal law, such

 

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disputes shall be determined in accordance with the law as it would be
interpreted and applied by the United States Court of Appeals for the Sixth
Circuit.

 

18.          Counterparts.  This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

 

19.          Successor to Company.  The Company shall require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the business or assets of the Company expressly to
assume and agree to perform this Agreement to the same extent that the Company
would be required to perform it if no succession had taken place.  Failure of
the Company to obtain an assumption of this Agreement at or prior to the
effectiveness of any succession shall be a material breach of this Agreement.

 

20.          Gender Neutral.  Wherever used herein, a pronoun in the masculine
gender shall be considered as including the feminine gender unless the context
clearly indicates otherwise.

 

IN WITNESS WHEREOF, the parties have executed this Agreement effective on the
date and year first above written.

 

 

AASTROM BIOSCIENCES, INC.

 

 

 

/s/ Dominick C. Colangelo

 

By: Dominick Colangelo

 

Its: CEO and President

 

 

 

EXECUTIVE

 

 

 

/s/ Gerard Michel

 

Gerard Michel

 

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