Exhibit 10.28

 

November 18, 2004

 

Gary M. Saxton

1622 Eagle Drive

Sunnyvale, CA  94087

 

Dear Gary:

 

We are pleased to invite you to join us as an employee of BioSphere Medical,
Inc. (the “Company”).  On behalf of the Company, I set forth in this letter
agreement the terms of your offer of at-will employment with the Company:

 

1.                                       Employment; Location; Duties.

 

You will be employed to serve on a full-time basis as Vice President, Marketing
and Sales, and will be based at the Company’s headquarters.  You will be subject
to the supervision of, and shall have such authority as is delegated to you by,
the Chief Executive Officer of the Company.  Assuming you accept this offer,
your employment will begin on November 18, 2004.

 

By accepting employment with the Company, you will be agreeing to undertake the
duties and responsibilities inherent in such position and such other duties and
responsibilities as the Chief Executive Officer shall from time to time
reasonably assign to you.  You agree to devote your entire business time,
attention and energies to the business and interests of the Company during your
employment.  You also agree to abide by the rules, regulations, instructions,
personnel practices and policies of the Company and any changes therein which
may be adopted from time to time by the Company.

 

2.                                       Compensation.

 

2.1                                 BASE SALARY.  YOUR INITIAL BASE SALARY WILL
BE $195,000, LESS APPLICABLE TAXES AND WITHHOLDINGS, PAID SEMI-MONTHLY IN
ACCORDANCE WITH THE COMPANY’S PAYROLL PRACTICES (“BASE SALARY”).  SUCH SALARY
AND PAY SCHEDULE MAY BE ADJUSTED FROM TIME TO TIME, IN ACCORDANCE WITH NORMAL
BUSINESS PRACTICE AND IN THE SOLE DISCRETION OF THE COMPANY’S BOARD OF
DIRECTORS.

 

2.2                                 BONUS.  YOU WILL BE ENTITLED TO RECEIVE AN
ANNUAL BONUS IN AN AMOUNT EQUAL TO UP TO 40% OF YOUR THEN CURRENT BASE SALARY,
TO BE PAID BASED UPON YOUR ACHIEVEMENT OF MILESTONES AND OBJECTIVES TO BE
MUTUALLY AGREED UPON ANNUALLY BY YOU AND THE COMPENSATION COMMITTEE OF THE BOARD
OF DIRECTORS, PROVIDED THAT YOU REMAIN AN EMPLOYEE OF THE COMPANY AT THE TIME
SUCH BONUSES ARE CUSTOMARILY PAID.

 

2.3                                 OTHER BENEFITS. YOU SHALL BE ELIGIBLE TO
PARTICIPATE IN ALL BENEFIT PROGRAMS THAT THE COMPANY ESTABLISHES AND GENERALLY
MAKES AVAILABLE TO ITS EMPLOYEES, IF ANY, TO THE EXTENT THAT YOUR POSITION,
TENURE, SALARY, AGE, HEALTH AND OTHER QUALIFICATIONS MAKE YOU ELIGIBLE TO

 

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PARTICIPATE, INCLUDING BUT NOT LIMITED TO THE COMPANY’S HEALTH INSURANCE PLAN,
401(K) PLAN, AND POLICIES GOVERNING PAID TIME OFF.  IN ADDITION, YOU SHALL BE
ENTITLED TO THREE (3) WEEKS PAID VACATION PER YEAR, SUBJECT TO THE COMPANY’S
POLICIES AND PROCEDURES, TO BE TAKEN AT SUCH TIMES AS MAY BE APPROVED BY THE
COMPANY’S CHIEF EXECUTIVE OFFICER OR HIS DESIGNEE.  THE COMPANY RESERVES THE
RIGHT TO AMEND AND/OR TERMINATE ANY PLAN, BENEFIT, OR PROGRAM AT ANY TIME WITH
OR WITHOUT NOTICE OR PUBLICATION.

 

2.4                                 OPTION.  SUBJECT TO APPROVAL BY THE
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS, ON OR ABOUT THE COMMENCEMENT
DATE YOU WILL BE GRANTED, PURSUANT TO THE COMPANY’S 1997 STOCK INCENTIVE PLAN
(THE “PLAN”) (A) AN OPTION TO PURCHASE 150,000 SHARES OF COMMON STOCK, $0.01 PAR
VALUE (“COMMON STOCK”) OF THE COMPANY PURSUANT TO THE TERMS AND CONDITIONS OF
THE PLAN AND A STOCK OPTION AGREEMENT ISSUED THEREUNDER, SUCH OPTION TO BE
EXERCISABLE AT A PRICE PER SHARE EQUAL TO THE CLOSING PRICE OF THE COMPANY’S
COMMON STOCK ON THE NASDAQ STOCK MARKET ON DATE OF GRANT, SUCH OPTION TO VEST
AND BECOME EXERCISABLE, SUBJECT TO YOUR CONTINUED EMPLOYMENT, AT A RATE OF 20%
OF THE TOTAL SHARES UNDERLYING THE OPTION ON THE FIRST ANNIVERSARY OF THE DATE
OF GRANT AND AS TO AN ADDITIONAL 20% AT THE END OF EACH FULL YEAR THEREAFTER AND
(B) AN OPTION, TO PURCHASE 50,000 SHARES OF THE COMPANY’S COMMON STOCK PURSUANT
TO THE TERMS AND CONDITIONS OF THE PLAN AND A STOCK OPTION AGREEMENT ISSUED
THEREUNDER, SUCH OPTION TO BE EXERCISABLE AT A PRICE PER SHARE EQUAL TO THE
CLOSING PRICE OF THE COMPANY’S COMMON STOCK ON THE DATE OF GRANT, SUCH OPTION TO
VEST AND BECOME EXERCISABLE, SUBJECT TO YOUR CONTINUED EMPLOYMENT, AT A RATE OF
33.3333% OF THE TOTAL SHARES UNDERLYING THE OPTION ON THE FIRST ANNIVERSARY OF
THE DATE ON WHICH THE COMPANY BOOKS REVENUE FROM THE COMMERCIAL SALE OF ITS
PRODUCTS IN EXCESS OF $25.0 MILLION (AS REFLECTED ON THE COMPANY’S FINANCIAL
STATEMENTS PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
IN THE UNITED STATES) IN ANY CONTINUOUS 12-MONTH PERIOD AND AS TO AN ADDITIONAL
33.3333% AT THE END OF EACH FULL YEAR THEREAFTER; PROVIDED THAT SUCH OPTION
SHALL VEST, IN ANY EVENT, ON THE END OF THE SEVENTH YEAR AFTER THE DATE OF
GRANT.

 

2.5                                 REIMBURSEMENT OF EXPENSES.  THE COMPANY
SHALL REIMBURSE YOU FOR ALL REASONABLE TRAVEL, ENTERTAINMENT AND OTHER EXPENSES
INCURRED OR PAID BY YOU IN CONNECTION WITH, OR RELATED TO, THE PERFORMANCE OF
YOUR DUTIES, RESPONSIBILITIES OR SERVICES AS AN EMPLOYEE OF THE COMPANY, IN
ACCORDANCE WITH POLICIES AND PROCEDURES, AND SUBJECT TO LIMITATIONS, ADOPTED BY
THE COMPANY FROM TIME TO TIME.

 

2.6                                 MOVING EXPENSES.  THE COMPANY SHALL
REIMBURSE YOU FOR (A) CUSTOMARY MOVING EXPENSES, (B) COMMISSION, ORIGINATION AND
CLOSING COSTS ASSOCIATED WITH THE SALE OF YOUR HOME IN CALIFORNIA AND PURCHASE
OF A HOME IN MASSACHUSETTS, AND (C) TEMPORARY LIVING AND COMMUTING EXPENSES
(CONSISTING OF AIRFARE, TEMPORARY HOUSING AND EXPENSES INCIDENT THERETO), IN AN
AGGREGATE AMOUNT NOT TO EXCEED $175,000, SUBJECT TO ANY APPLICABLE TAXES OR
WITHHOLDINGS.

 

3.                                       Termination Upon or in Anticipation of
a Change in Control.

 

3.1                                 IN THE EVENT YOUR AT-WILL EMPLOYMENT IS
TERMINATED BY THE COMPANY WITHOUT CAUSE (AS DEFINED BELOW) IN ANTICIPATION OF,
OR WITHIN TWELVE MONTHS AFTER, A CHANGE IN

 

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CONTROL (AS DEFINED BELOW), THE COMPANY SHALL CONTINUE TO PAY TO YOU YOUR SALARY
AS IN EFFECT ON THE DATE OF TERMINATION AND THE AMOUNT OF THE ANNUAL BONUS PAID
TO YOU FOR THE FISCAL YEAR IMMEDIATELY PRECEDING THE DATE OF TERMINATION
(PAYABLE IN ANNUALIZED MONTHLY INSTALLMENTS) AND SHALL, PROVIDED YOU ELECT TO
RECEIVE GROUP MEDICAL INSURANCE PURSUANT TO THE FEDERAL “COBRA” LAW,  29 U.S.C.
§ 1161 ET SEQ., PROVIDE TO YOU REIMBURSEMENT FOR THE SHARE OF THE PREMIUM FOR
GROUP MEDICAL AND DENTAL THAT IS PAID BY THE COMPANY FOR ACTIVE AND
SIMILARLY-SITUATED EMPLOYEES WHO RECEIVE THE SAME TYPE OF COVERAGE, UNTIL THE
DATE 12 MONTHS AFTER THE DATE OF TERMINATION, PROVIDED, HOWEVER, THAT THE
COMPANY’S OBLIGATION TO MAKE THE AFORESAID PAYMENTS OR PROVIDE THE AFORESAID
BENEFITS SHALL IMMEDIATELY TERMINATE IN THE EVENT THAT YOU VIOLATE THE
PROVISIONS OF SECTION 4 OR SECTION  5 DURING SUCH 12 MONTH PERIOD.  THE PAYMENT
TO YOU OF THE AMOUNTS PAYABLE UNDER THIS SECTION 3.1  SHALL BE CONTINGENT UPON
YOUR EXECUTION OF A RELEASE IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY AND
(II) SHALL CONSTITUTE YOUR SOLE REMEDY IN THE EVENT OF A TERMINATION OF YOUR
EMPLOYMENT IN THE CIRCUMSTANCES SET FORTH IN THIS SECTION 3.1.

 

3.2                                 “CAUSE” SHALL, FOR THE PURPOSES OF
SECTION 3.1, MEAN (A) YOUR WILLFUL AND CONTINUED FAILURE TO SUBSTANTIALLY
PERFORM YOUR REASONABLE ASSIGNED DUTIES (OTHER THAN ANY SUCH FAILURE RESULTING
FROM INCAPACITY DUE TO PHYSICAL OR MENTAL ILLNESS), WHICH FAILURE IS NOT CURED
WITHIN 30 DAYS AFTER A WRITTEN DEMAND FOR SUBSTANTIAL PERFORMANCE IS RECEIVED BY
YOU FROM THE BOARD WHICH SPECIFICALLY IDENTIFIES THE MANNER IN WHICH THE BOARD
BELIEVES YOU HAVE NOT SUBSTANTIALLY PERFORMED YOUR DUTIES; OR (B) YOUR WILLFUL
ENGAGEMENT IN ILLEGAL CONDUCT OR GROSS MISCONDUCT WHICH IS MATERIALLY AND
DEMONSTRABLY INJURIOUS TO THE COMPANY.  FOR PURPOSES OF THIS SECTION 3.2, NO ACT
OR FAILURE TO ACT BY YOU SHALL BE CONSIDERED “WILLFUL” UNLESS IT IS DONE, OR
OMITTED TO BE DONE, IN BAD FAITH AND WITHOUT REASONABLE BELIEF THAT YOUR ACTION
OR OMISSION WAS IN THE BEST INTERESTS OF THE COMPANY.

 

3.3                                 “CHANGE IN CONTROL” MEANS AN EVENT OR
OCCURRENCE SET FORTH IN ANY ONE OR MORE OF SUBSECTIONS (A) THROUGH (D) BELOW
(INCLUDING AN EVENT OR OCCURRENCE THAT CONSTITUTES A CHANGE IN CONTROL UNDER ONE
OF SUCH SUBSECTIONS BUT IS SPECIFICALLY EXEMPTED FROM ANOTHER SUCH SUBSECTION):

 

(A)                                  THE ACQUISITION BY AN INDIVIDUAL, ENTITY OR
GROUP (WITHIN THE MEANING OF SECTION 13(D)(3) OR 14(D)(2) OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED (THE “EXCHANGE ACT”)) (A “PERSON”) OF
BENEFICIAL OWNERSHIP OF ANY CAPITAL STOCK OF THE COMPANY IF, AFTER SUCH
ACQUISITION, SUCH PERSON BENEFICIALLY OWNS (WITHIN THE MEANING OF RULE 13D-3
PROMULGATED UNDER THE EXCHANGE ACT) 50% OR MORE OF EITHER (X) THE
THEN-OUTSTANDING SHARES OF COMMON STOCK OF THE COMPANY (THE “OUTSTANDING COMPANY
COMMON STOCK”) OR (Y) THE COMBINED VOTING POWER OF THE THEN-OUTSTANDING
SECURITIES OF THE COMPANY ENTITLED TO VOTE GENERALLY IN THE ELECTION OF
DIRECTORS (THE “OUTSTANDING COMPANY VOTING SECURITIES”); PROVIDED, HOWEVER, THAT
FOR PURPOSES OF THIS SUBSECTION (A), THE FOLLOWING ACQUISITIONS SHALL NOT
CONSTITUTE A CHANGE IN CONTROL: (I) ANY ACQUISITION DIRECTLY FROM THE COMPANY
(EXCLUDING AN ACQUISITION PURSUANT TO THE EXERCISE, CONVERSION OR EXCHANGE OF
ANY SECURITY EXERCISABLE FOR, CONVERTIBLE INTO OR EXCHANGEABLE FOR COMMON STOCK
OR VOTING SECURITIES OF THE COMPANY, UNLESS THE PERSON EXERCISING, CONVERTING OR
EXCHANGING SUCH SECURITY ACQUIRED SUCH SECURITY DIRECTLY FROM THE COMPANY OR AN
UNDERWRITER OR AGENT OF THE COMPANY), (II) ANY ACQUISITION BY THE COMPANY, (III)

 

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ANY ACQUISITION BY ANY EMPLOYEE BENEFIT PLAN (OR RELATED TRUST) SPONSORED OR
MAINTAINED BY THE COMPANY OR ANY CORPORATION CONTROLLED BY THE COMPANY, OR (IV)
ANY ACQUISITION BY ANY CORPORATION PURSUANT TO A TRANSACTION WHICH COMPLIES WITH
CLAUSES (I) AND (II) OF SUBSECTION (C) OF THIS SECTION 1.1; OR

 

(B)                                 SUCH TIME AS THE CONTINUING DIRECTORS (AS
DEFINED BELOW) DO NOT CONSTITUTE A MAJORITY OF THE BOARD (OR, IF APPLICABLE, THE
BOARD OF DIRECTORS OF A SUCCESSOR CORPORATION TO THE COMPANY), WHERE THE TERM
“CONTINUING DIRECTOR” MEANS AT ANY DATE A MEMBER OF THE  BOARD (I) WHO WAS A
MEMBER OF THE BOARD ON THE DATE OF THE EXECUTION OF THIS LETTER AGREEMENT OR
(II) WHO WAS NOMINATED OR ELECTED SUBSEQUENT TO SUCH DATE BY AT LEAST A MAJORITY
OF THE DIRECTORS WHO WERE CONTINUING DIRECTORS AT THE TIME OF SUCH NOMINATION OR
ELECTION OR WHOSE ELECTION TO THE BOARD WAS RECOMMENDED OR ENDORSED BY AT LEAST
A MAJORITY OF THE DIRECTORS WHO WERE CONTINUING DIRECTORS AT THE TIME OF SUCH
NOMINATION OR ELECTION; PROVIDED, HOWEVER, THAT THERE SHALL BE EXCLUDED FROM
THIS CLAUSE (II) ANY INDIVIDUAL WHOSE INITIAL ASSUMPTION OF OFFICE OCCURRED AS A
RESULT OF AN ACTUAL OR THREATENED ELECTION CONTEST WITH RESPECT TO THE ELECTION
OR REMOVAL OF DIRECTORS OR OTHER ACTUAL OR THREATENED SOLICITATION OF PROXIES OR
CONSENTS, BY OR ON BEHALF OF A PERSON OTHER THAN THE BOARD; OR

 

(C)                                  THE CONSUMMATION OF A MERGER,
CONSOLIDATION, REORGANIZATION, RECAPITALIZATION OR STATUTORY SHARE EXCHANGE
INVOLVING THE COMPANY OR A SALE OR OTHER DISPOSITION OF ALL OR SUBSTANTIALLY ALL
OF THE ASSETS OF THE COMPANY IN ONE OR A SERIES OF TRANSACTIONS (A “BUSINESS
COMBINATION”), UNLESS, IMMEDIATELY FOLLOWING SUCH BUSINESS COMBINATION, EACH OF
THE FOLLOWING TWO CONDITIONS IS SATISFIED: (I) ALL OR SUBSTANTIALLY ALL OF THE
INDIVIDUALS AND ENTITIES WHO WERE THE BENEFICIAL OWNERS OF THE OUTSTANDING
COMPANY COMMON STOCK AND OUTSTANDING COMPANY VOTING SECURITIES IMMEDIATELY PRIOR
TO SUCH BUSINESS COMBINATION BENEFICIALLY OWN, DIRECTLY OR INDIRECTLY, MORE THAN
50% OF THE THEN-OUTSTANDING SHARES OF COMMON STOCK AND THE COMBINED VOTING POWER
OF THE THEN-OUTSTANDING SECURITIES ENTITLED TO VOTE GENERALLY IN THE ELECTION OF
DIRECTORS, RESPECTIVELY, OF THE RESULTING OR ACQUIRING CORPORATION IN SUCH
BUSINESS COMBINATION (WHICH SHALL INCLUDE, WITHOUT LIMITATION, A CORPORATION
WHICH AS A RESULT OF SUCH TRANSACTION OWNS THE COMPANY OR SUBSTANTIALLY ALL OF
THE COMPANY’S ASSETS EITHER DIRECTLY OR THROUGH ONE OR MORE SUBSIDIARIES) (SUCH
RESULTING OR ACQUIRING CORPORATION IS REFERRED TO HEREIN AS THE “ACQUIRING
CORPORATION”) IN SUBSTANTIALLY THE SAME PROPORTIONS AS THEIR OWNERSHIP,
IMMEDIATELY PRIOR TO SUCH BUSINESS COMBINATION, OF THE OUTSTANDING COMPANY
COMMON STOCK AND OUTSTANDING COMPANY VOTING SECURITIES, RESPECTIVELY; AND (II)
NO PERSON (EXCLUDING ANY EMPLOYEE BENEFIT PLAN (OR RELATED TRUST) MAINTAINED OR
SPONSORED BY THE COMPANY OR BY THE ACQUIRING CORPORATION) BENEFICIALLY OWNS,
DIRECTLY OR INDIRECTLY, 50% OR MORE OF THE THEN OUTSTANDING SHARES OF COMMON
STOCK OF THE ACQUIRING CORPORATION, OR OF THE COMBINED VOTING POWER OF THE
THEN-OUTSTANDING SECURITIES OF SUCH CORPORATION ENTITLED TO VOTE GENERALLY IN
THE ELECTION OF DIRECTORS (EXCEPT TO THE EXTENT THAT SUCH OWNERSHIP EXISTED
PRIOR TO THE BUSINESS COMBINATION); OR

 

(D)                                 APPROVAL BY THE STOCKHOLDERS OF THE COMPANY
OF A COMPLETE LIQUIDATION OR DISSOLUTION OF THE COMPANY.

 

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4.                                       Non-Competition and Non-Solicitation.

 

4.1                                 RESTRICTED ACTIVITIES.  WHILE YOU ARE
EMPLOYED BY THE COMPANY AND FOR A PERIOD OF ONE YEAR AFTER THE TERMINATION OR
CESSATION OF SUCH EMPLOYMENT FOR ANY REASON, YOU WILL NOT DIRECTLY OR
INDIRECTLY:

 

(A)                                  ENGAGE IN ANY BUSINESS OR ENTERPRISE
(WHETHER AS OWNER, PARTNER, OFFICER, DIRECTOR, EMPLOYEE, CONSULTANT, INVESTOR,
LENDER OR OTHERWISE, EXCEPT AS THE HOLDER OF NOT MORE THAN 1% OF THE OUTSTANDING
STOCK OF A PUBLICLY-HELD COMPANY) THAT IS COMPETITIVE WITH THE COMPANY’S
BUSINESS IN THE FIELD OF EMBOLOTHERAPY, INCLUDING BUT NOT LIMITED TO ANY
BUSINESS OR ENTERPRISE THAT DEVELOPS, MANUFACTURES, MARKETS, LICENSES, SELLS OR
PROVIDES ANY PRODUCT OR SERVICE IN THE FIELD OF EMBOLOTHERAPY THAT COMPETES WITH
ANY PRODUCT OR SERVICE IN THE FIELD OF EMBOLOTHERAPY DEVELOPED, MANUFACTURED,
MARKETED, LICENSED, SOLD OR PROVIDED, OR PLANNED TO BE DEVELOPED, MANUFACTURED,
MARKETED, LICENSED, SOLD OR PROVIDED, BY THE COMPANY OR ANY OF ITS SUBSIDIARIES
WHILE YOU WERE EMPLOYED BY THE COMPANY; OR

 

(B)                                 EITHER ALONE OR IN ASSOCIATION WITH OTHERS
(I) SOLICIT, OR PERMIT ANY ORGANIZATION DIRECTLY OR INDIRECTLY CONTROLLED BY YOU
TO SOLICIT, ANY EMPLOYEE OF THE COMPANY TO LEAVE THE EMPLOY OF THE COMPANY, OR
(II) SOLICIT FOR EMPLOYMENT, HIRE OR ENGAGE AS AN INDEPENDENT CONTRACTOR, OR
PERMIT ANY ORGANIZATION DIRECTLY OR INDIRECTLY CONTROLLED BY YOU TO SOLICIT FOR
EMPLOYMENT, HIRE OR ENGAGE AS AN INDEPENDENT CONTRACTOR, ANY PERSON WHO WAS
EMPLOYED BY THE COMPANY AT THE TIME OF THE TERMINATION OR CESSATION OF YOUR
EMPLOYMENT WITH THE COMPANY; PROVIDED, THAT THIS CLAUSE (II) SHALL NOT APPLY TO
THE SOLICITATION, HIRING OR ENGAGEMENT OF ANY INDIVIDUAL WHOSE EMPLOYMENT WITH
THE COMPANY HAS BEEN TERMINATED FOR A PERIOD OF SIX MONTHS OR LONGER.

 

4.2                                 EXTENSION.  IF YOU VIOLATE THE PROVISIONS OF
SECTION 4.1, YOU SHALL CONTINUE TO BE BOUND BY THE RESTRICTIONS SET FORTH IN
SECTION 4.1 UNTIL A PERIOD OF ONE YEAR HAS EXPIRED WITHOUT ANY VIOLATION OF SUCH
PROVISIONS.

 

4.3                                 INTERPRETATION.  IF ANY RESTRICTION SET
FORTH IN SECTION 4.1 IS FOUND BY ANY COURT OF COMPETENT JURISDICTION TO BE
UNENFORCEABLE BECAUSE IT EXTENDS FOR TOO LONG A PERIOD OF TIME OR OVER TOO GREAT
A RANGE OF ACTIVITIES OR IN TOO BROAD A GEOGRAPHIC AREA, IT SHALL BE INTERPRETED
TO EXTEND ONLY OVER THE MAXIMUM PERIOD OF TIME, RANGE OF ACTIVITIES OR
GEOGRAPHIC AREA AS TO WHICH IT MAY BE ENFORCEABLE.

 

4.4                                 EQUITABLE REMEDIES.  THE RESTRICTIONS
CONTAINED IN THIS SECTION 4 ARE NECESSARY FOR THE PROTECTION OF THE BUSINESS AND
GOODWILL OF THE COMPANY AND ARE CONSIDERED BY YOU TO BE REASONABLE FOR SUCH
PURPOSE.  YOU AGREE THAT ANY BREACH OF THIS SECTION 4 IS LIKELY TO CAUSE THE
COMPANY SUBSTANTIAL AND IRREVOCABLE DAMAGE WHICH IS DIFFICULT TO MEASURE. 
THEREFORE, IN THE EVENT OF ANY SUCH BREACH OR THREATENED BREACH, YOU AGREE THAT
THE COMPANY, IN ADDITION TO SUCH OTHER REMEDIES WHICH MAY BE AVAILABLE, SHALL
HAVE THE RIGHT TO OBTAIN AN INJUNCTION FROM A COURT RESTRAINING SUCH A BREACH OR
THREATENED BREACH AND THE RIGHT TO SPECIFIC PERFORMANCE OF THE PROVISIONS OF
THIS SECTION 4 AND YOU HEREBY WAIVE THE ADEQUACY OF A REMEDY AT LAW AS A DEFENSE
TO SUCH RELIEF.

 

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5.             Proprietary Information and Developments.

 

5.1                                 PROPRIETARY INFORMATION.

 

(A)                                  YOU AGREE THAT ALL INFORMATION, WHETHER OR
NOT IN WRITING, OF A PRIVATE, SECRET OR CONFIDENTIAL NATURE CONCERNING THE
COMPANY’S BUSINESS, BUSINESS RELATIONSHIPS OR FINANCIAL AFFAIRS (COLLECTIVELY,
“PROPRIETARY INFORMATION”) IS AND SHALL BE THE EXCLUSIVE PROPERTY OF THE
COMPANY.  BY WAY OF ILLUSTRATION, BUT NOT LIMITATION, PROPRIETARY INFORMATION
MAY INCLUDE INVENTIONS, PRODUCTS, PROCESSES, METHODS, TECHNIQUES, FORMULAS,
COMPOSITIONS, COMPOUNDS, PROJECTS, DEVELOPMENTS, PLANS, RESEARCH DATA, CLINICAL
DATA, FINANCIAL DATA, PERSONNEL DATA, COMPUTER PROGRAMS, CUSTOMER AND SUPPLIER
LISTS, AND CONTACTS AT OR KNOWLEDGE OF CUSTOMERS OR PROSPECTIVE CUSTOMERS OF THE
COMPANY.  YOU WILL NOT DISCLOSE ANY PROPRIETARY INFORMATION TO ANY PERSON OR
ENTITY OTHER THAN EMPLOYEES OF THE COMPANY OR USE THE SAME FOR ANY PURPOSES
(OTHER THAN IN THE PERFORMANCE OF YOUR DUTIES AS AN EMPLOYEE OF THE COMPANY)
WITHOUT WRITTEN APPROVAL BY AN OFFICER OF THE COMPANY, EITHER DURING OR AFTER
YOUR EMPLOYMENT WITH THE COMPANY, UNLESS AND UNTIL SUCH PROPRIETARY INFORMATION
HAS BECOME PUBLIC KNOWLEDGE WITHOUT FAULT BY YOU OR UNLESS REQUIRED BY LAW.

 

(B)                                 YOU AGREE THAT ALL FILES, LETTERS,
MEMORANDA, REPORTS, RECORDS, DATA, SKETCHES, DRAWINGS, LABORATORY NOTEBOOKS,
PROGRAM LISTINGS, OR OTHER WRITTEN, PHOTOGRAPHIC, OR OTHER TANGIBLE MATERIAL
CONTAINING PROPRIETARY INFORMATION, WHETHER CREATED BY YOU OR OTHERS, WHICH
SHALL COME INTO YOUR CUSTODY OR POSSESSION, SHALL BE AND ARE THE EXCLUSIVE
PROPERTY OF THE COMPANY TO BE USED BY YOU ONLY IN THE PERFORMANCE OF YOUR DUTIES
FOR THE COMPANY.  ALL SUCH MATERIALS OR COPIES THEREOF AND ALL TANGIBLE PROPERTY
OF THE COMPANY IN YOUR CUSTODY OR POSSESSION SHALL BE DELIVERED TO THE COMPANY,
UPON THE EARLIER OF (I) A REQUEST BY THE COMPANY OR (II) TERMINATION OF YOUR
EMPLOYMENT.  AFTER SUCH DELIVERY, YOU SHALL NOT RETAIN ANY SUCH MATERIALS OR
COPIES THEREOF OR ANY SUCH TANGIBLE PROPERTY.

 

(C)                                  YOU AGREE THAT YOUR OBLIGATION NOT TO
DISCLOSE OR TO USE INFORMATION AND MATERIALS OF THE TYPES SET FORTH IN
PARAGRAPHS (A) AND (B) ABOVE, AND YOUR OBLIGATION TO RETURN MATERIALS AND
TANGIBLE PROPERTY, SET FORTH IN PARAGRAPH (B) ABOVE, ALSO EXTENDS TO SUCH TYPES
OF INFORMATION, MATERIALS AND TANGIBLE PROPERTY OF CUSTOMERS OF THE COMPANY OR
SUPPLIERS TO THE COMPANY OR OTHER THIRD PARTIES WHO MAY HAVE DISCLOSED OR
ENTRUSTED THE SAME TO THE COMPANY OR TO YOU.

 

5.2                                 DEVELOPMENTS.

 

(A)                                  YOU WILL MAKE FULL AND PROMPT DISCLOSURE TO
THE COMPANY OF ALL INVENTIONS, IMPROVEMENTS, DISCOVERIES, METHODS, DEVELOPMENTS,
SOFTWARE, AND WORKS OF AUTHORSHIP, WHETHER PATENTABLE OR NOT, WHICH ARE CREATED,
MADE, CONCEIVED OR REDUCED TO PRACTICE BY YOU OR UNDER YOUR DIRECTION OR JOINTLY
WITH OTHERS DURING YOUR EMPLOYMENT BY THE COMPANY, WHETHER OR NOT DURING NORMAL
WORKING HOURS OR ON THE PREMISES OF THE COMPANY (ALL OF WHICH ARE COLLECTIVELY
REFERRED TO IN THIS LETTER AGREEMENT AS “DEVELOPMENTS”).

 

(B)                                 YOU AGREE TO ASSIGN AND DO HEREBY ASSIGN TO
THE COMPANY (OR ANY PERSON OR ENTITY DESIGNATED BY THE COMPANY) ALL YOUR RIGHT,
TITLE AND INTEREST IN AND TO ALL DEVELOPMENTS AND ALL RELATED PATENTS, PATENT
APPLICATIONS, COPYRIGHTS AND COPYRIGHT APPLICATIONS.

 

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HOWEVER, THIS PARAGRAPH (B) SHALL NOT APPLY TO DEVELOPMENTS WHICH DO NOT RELATE
TO THE BUSINESS OR RESEARCH AND DEVELOPMENT CONDUCTED OR PLANNED TO BE CONDUCTED
BY THE COMPANY AT THE TIME SUCH DEVELOPMENT IS CREATED, MADE, CONCEIVED OR
REDUCED TO PRACTICE AND WHICH ARE MADE AND CONCEIVED BY YOU NOT DURING NORMAL
WORKING HOURS, NOT ON THE COMPANY’S PREMISES AND NOT USING THE COMPANY’S TOOLS,
DEVICES, EQUIPMENT OR PROPRIETARY INFORMATION.  YOU UNDERSTAND THAT, TO THE
EXTENT THIS LETTER AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
ANY STATE WHICH PRECLUDES A REQUIREMENT IN AN EMPLOYEE AGREEMENT TO ASSIGN
CERTAIN CLASSES OF INVENTIONS MADE BY AN EMPLOYEE, THIS PARAGRAPH (B) SHALL BE
INTERPRETED NOT TO APPLY TO ANY INVENTION WHICH A COURT RULES AND/OR THE COMPANY
AGREES FALLS WITHIN SUCH CLASSES.  YOU ALSO HEREBY WAIVE ALL CLAIMS TO MORAL
RIGHTS IN ANY DEVELOPMENTS.

 

(C)                                  YOU AGREE TO COOPERATE FULLY WITH THE
COMPANY, BOTH DURING AND AFTER YOUR EMPLOYMENT WITH THE COMPANY, WITH RESPECT TO
THE PROCUREMENT, MAINTENANCE AND ENFORCEMENT OF COPYRIGHTS, PATENTS AND OTHER
INTELLECTUAL PROPERTY RIGHTS (BOTH IN THE UNITED STATES AND FOREIGN COUNTRIES)
RELATING TO DEVELOPMENTS.  YOU SHALL SIGN ALL PAPERS, INCLUDING, WITHOUT
LIMITATION, COPYRIGHT APPLICATIONS, PATENT APPLICATIONS, DECLARATIONS, OATHS,
FORMAL ASSIGNMENTS, ASSIGNMENTS OF PRIORITY RIGHTS, AND POWERS OF ATTORNEY,
WHICH THE COMPANY MAY DEEM NECESSARY OR DESIRABLE IN ORDER TO PROTECT ITS RIGHTS
AND INTERESTS IN ANY DEVELOPMENT.  YOU FURTHER AGREE THAT IF THE COMPANY IS
UNABLE, AFTER REASONABLE EFFORT, TO SECURE YOUR SIGNATURE ON ANY SUCH PAPERS,
ANY EXECUTIVE OFFICER OF THE COMPANY SHALL BE ENTITLED TO EXECUTE ANY SUCH
PAPERS AS YOUR AGENT AND ATTORNEY-IN-FACT, AND YOU HEREBY IRREVOCABLY DESIGNATE
AND APPOINT EACH EXECUTIVE OFFICER OF THE COMPANY AS YOUR AGENT AND
ATTORNEY-IN-FACT TO EXECUTE ANY SUCH PAPERS ON HIS BEHALF, AND TO TAKE ANY AND
ALL ACTIONS AS THE COMPANY MAY DEEM NECESSARY OR DESIRABLE IN ORDER TO PROTECT
ITS RIGHTS AND INTERESTS IN ANY DEVELOPMENT, UNDER THE CONDITIONS DESCRIBED IN
THIS SENTENCE.

 

5.3                                 UNITED STATES GOVERNMENT OBLIGATIONS.  YOU
ACKNOWLEDGE THAT THE COMPANY FROM TIME TO TIME MAY HAVE AGREEMENTS WITH OTHER
PARTIES OR WITH THE UNITED STATES GOVERNMENT, OR AGENCIES THEREOF, WHICH IMPOSE
OBLIGATIONS OR RESTRICTIONS ON THE COMPANY REGARDING INVENTIONS MADE DURING THE
COURSE OF WORK UNDER SUCH AGREEMENTS OR REGARDING THE CONFIDENTIAL NATURE OF
SUCH WORK.  YOU AGREE TO BE BOUND BY ALL SUCH OBLIGATIONS AND RESTRICTIONS WHICH
ARE MADE KNOWN TO YOU AND TO TAKE ALL APPROPRIATE ACTION NECESSARY TO DISCHARGE
THE OBLIGATIONS OF THE COMPANY UNDER SUCH AGREEMENTS.

 

5.4                                 EQUITABLE REMEDIES.  THE RESTRICTIONS
CONTAINED IN THIS SECTION 4 ARE NECESSARY FOR THE PROTECTION OF THE BUSINESS AND
GOODWILL OF THE COMPANY AND ARE CONSIDERED BY YOU TO BE REASONABLE FOR SUCH
PURPOSE.  YOU AGREE THAT ANY BREACH OF THIS SECTION 4 IS LIKELY TO CAUSE THE
COMPANY SUBSTANTIAL AND IRREVOCABLE DAMAGE WHICH IS DIFFICULT TO MEASURE. 
THEREFORE, IN THE EVENT OF ANY SUCH BREACH OR THREATENED BREACH, YOU AGREE THAT
THE COMPANY, IN ADDITION TO SUCH OTHER REMEDIES WHICH MAY BE AVAILABLE, SHALL
HAVE THE RIGHT TO OBTAIN AN INJUNCTION FROM A COURT RESTRAINING SUCH A BREACH OR
THREATENED BREACH AND THE RIGHT TO SPECIFIC PERFORMANCE OF THE PROVISIONS OF
THIS SECTION 4 AND YOU HEREBY WAIVE THE ADEQUACY OF A REMEDY AT LAW AS A DEFENSE
TO SUCH RELIEF.

 

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6.                                       Conflicts.

 

You represent that you are not bound by any employment contract, restrictive
covenant or other restriction preventing you from entering into employment with
or carrying out your responsibilities for the Company, or which is in any way
inconsistent with the terms of this letter.

 

7.                                       Successors and Assigns. 

 

This letter agreement shall be binding upon and inure to the benefit of both
parties and their respective successors and assigns, including any corporation
with which, or into which, the Company may be merged or which may succeed to the
Company’s assets or business, provided, however, that your obligations are
personal and shall not be assigned by you.  Notwithstanding the foregoing, if
the Company is merged with or into a third party which is engaged in multiple
lines of business, or if a third party engaged in multiple lines of business
succeeds to the Company’s assets or business, then for purposes of
Section 4.1(a), the term “Company” shall mean and refer to the business of the
Company as it existed immediately prior to such event and as it subsequently
develops and not to the third party’s other businesses.

 

8.                                       At-Will Status, Authorization to Work
and Choice of Law.

 

This letter shall not be construed as an agreement, either express or implied,
to employ you for any stated term, and shall in no way alter the Company’s
policy of employment at will, under which both you and the Company remain free
to terminate the employment relationship, with or without cause, at any time,
with or without notice.  Similarly, nothing in this letter shall be construed as
an agreement, either express or implied, to pay you any compensation or grant
you any benefit beyond the end of your employment with the Company except as
described in Section 3.1.

 

You agree to provide to the Company, within three days of your hire date,
documentation of your eligibility to work in the United States, as required by
the Immigration Reform and Control Act of 1986.  You may need to obtain a work
visa in order to be eligible to work in the United States.  If that is the case,
your employment with the Company will be conditioned upon your obtaining a work
visa in a timely manner as determined by the Company.

 

This letter agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts (without reference to the conflicts of
laws provisions thereof).  Any action, suit or other legal proceeding arising
under or relating to any provision of this letter agreement shall be commenced
only in a court of the Commonwealth of Massachusetts (or, if appropriate, a
federal court located within Massachusetts), and the Company and the Employee
each consents to the jurisdiction of such a court.  The Company and the Employee
each hereby irrevocably waive any right to a trial by jury in any action, suit
or other legal proceeding arising under or relating to any provision of this
letter agreement.

 

If this letter correctly sets forth the terms under which the Company will
employ you, please sign the enclosed duplicate of this letter in the space
provided below and return it to me.

 

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Sincerely,

 

 

 

By:

/s/ Richard J. Faleschini

 

 

Name:

Richard J. Faleschini

 

Title:

President and Chief Executive Officer

 

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The foregoing correctly sets forth the terms of my

at-will employment by BioSphere Medical, Inc.,

including but not limited to Sections 4 and 5 above.

 

/s/ Gary M. Saxton

 

 

Gary M. Saxton

 

 

 

 

 

Date:

11/18/04

 

 

 

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