exh10_1.htm


    EXECUTION
      COPY

    


    EXHIBIT
      10.1

     

    EMPLOYMENT
      AGREEMENT

     

    EMPLOYMENT
      AGREEMENT effective as of October 15, 2007 (the “Commencement Date”) by and
      between Stephen Ferrone (“Executive”), and Immunosyn Corporation, a Delaware
      corporation (the “Company”) by or through its officers (this
“Agreement”).

     

    The
      parties hereto wish to enter into an employment agreement on the terms and
      conditions set forth below.  Accordingly, in consideration of the
      premises and the respective covenants and agreements of the parties herein
      contained, and intending to be legally bound hereby, the parties hereto agree
      as
      follows:

     

    1.           Term.  The
      Executive’s employment under this Agreement shall commence on the Commencement
      Date and shall end, unless terminated earlier pursuant to Section 4, at the
      close of business on December 31st, 2009 (the “Term”);
provided, however, that the Term shall thereafter be automatically
      extended for each succeeding one (1) year period unless either party hereto
      shall provide the other party with a written notice at least thirty (30) days
      prior to the end of the then current Term, advising that the party providing
      the
      notice shall not agree to so extend the Term.

     

    2.           Title,
      Duties and Authority.  The Executive shall serve as Chief
      Executive Officer and President of the Company, and shall have such
      responsibilities and duties consistent with such position and/or as may from
      time to time be assigned to the Executive by the board of directors of the
      Company (the “Board”), and shall have all of the powers and duties usually
      incident to such offices.  In addition, Argyll Biotechnologies, LLC
      agrees to nominate and/or cause the Executive to be elected to the Company’s
      Board of Directors at each annual meeting of stockholders during the Term of
      the
      Executive’s employment hereunder or, if there shall at any time be director
      classes, at each such meeting at which Executive’s director class comes up for
      election, and Argyll agrees to vote all, or cause (to the extent within its
      control) to be voted, shares of the Company owned or controlled by Argyll,
      directly or indirectly, to be voted, to elect Executive to serve on the
      Company’s Board.  Executive hereby agrees to serve on the Company’s
      Board if elected.  The Executive shall devote substantially all of his
      working time and efforts to the business and affairs of the Company, except
      for
      vacations, illness and incapacity; provided, however, that the
      Executive may serve on the boards of directors of non-public companies and
      charitable organizations and may devote reasonable time to charitable and civic
      organizations, in all cases provided that the performance of his duties and
      responsibilities on such boards and in such service does not interfere
      substantially with the performance of his duties and responsibilities under
      this
      Agreement.

     

    3.           Compensation
      and Benefits.

     

    (a)           Base
      Salary.  During the Term, the Company shall pay the Executive a
      base salary (“Base Salary”).  The Base Salary shall be Four Hundred
      Thousand Dollars ($400,000 USD) per year for calendar year 2007 (pro rated
      for
      the portion of the year included in the Term) payable semi-monthly (less
      applicable taxes and withholdings); Five Hundred Thousand Dollars ($500,000
      USD)
      per year for calendar year 2008 and Six Hundred Thousand Dollars ($600,000
      USD)
      per year for calendar year 2009.  The Base Salary shall be subject to


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    annual
      review by the Board or the Compensation Committee thereof for discretionary
      periodic increases but not decreases; provided, however, that for
      each subsequent calendar year during the Term, commencing with the 2010 calendar
      year, the amount of the Executive’s Base Salary shall be increased by not less
      than the United States benchmark annualized rate of inflation of the previous
      calendar year.  Should Company capital subsequent to Executive’s
      Commencement Date be insufficient to meet the Executive’s salary requirements in
      3(a), said salary claim accrues and is payable when said funds become available
      to the Company.

     

    (b)           Bonus
      – Revenue Share.  Executive shall receive a bonus for each year of
      the Term determined in accordance with the following formula and paid between
      January 1 and March 15 of the following year (“Bonus”):

     

    
      	
               

            	
              ·

            	
              one
                half of one percent (0.005%) on gross revenues (GR) less the Company’s
                cost of product (GR) of $0.00-$500 Million Dollars
                (USD)

            


    

    
      	
               

            	
              ·

            	
              three
                quarters of one percent (0.075%) on GR of $500-One Billion Dollars
                (USD)

            


    

    
      	
               

            	
              ·

            	
              one
                percent (.01%) on GR above $One Billion Dollars
                (USD)

            


    

    


    (c)           Stock
      Options.  For each partial and full year of the Term, the
      Executive shall be eligible to participate in the Company’s Stock Option Plan;
      otherwise the Executive shall be granted Company options subject to approval
      by
      the Compensation Committee of the Board of Directors and in a manner customary
      for like companies in the industry (such option exercise price being equal
      to
      the fair market value of the stock on December 31st of the term year for which
      they are being granted).

     

    (d)           Employee
      Benefits and Incentive Arrangements.  The Executive shall be
      entitled to participate in all of the Company’s employee benefit and incentive
      compensation plans and arrangements made available during the Term to the senior
      executives of the Company as may be in effect from time to time.  If
      health insurance is not in place as of the Commencement Date, the Company will
      make reasonable efforts to make such benefits available to employees of the
      Company within a reasonable time following the Commencement Date.

     

    (e)           Expenses.  The
      Executive shall be entitled to receive prompt reimbursement of his expenses
      incurred in the performance of his employment hereunder upon his submission
      to
      the Company of reasonable and customary expense claims pursuant to the Company’s
      Expense Reimbursement Policy.  All expense submissions shall be
      subject to review and approval by the Company.  The Company shall
      reimburse Executive no later than the end of the year following the year in
      which any such expense is incurred.  The amount of Executive’s
      expenses eligible for reimbursement during any taxable year will not affect
      the
      expenses eligible for reimbursement in any other taxable year.

     

    (f)           Vacations.  The
      Executive shall be entitled to four (4) weeks paid vacation in each calendar
      year during the Term.  Subject to applicable laws and Company policy,
      the Executive may not accrue more than four (4) weeks of paid vacation days
      at
      any given time; such that he shall never have an accrual of greater than four
      (4) weeks of vacation days at any given time, subject to provision changes
      in
      the benefits and compensation policy of the Company.

     

    
      
        
        

      

      
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    (g)           Sick
      Days.  The Executive shall be entitled to five (5) days off per
      calendar year due to sickness or illness.  Executive shall provide
      notice to the Company of such sick days as soon as reasonably
      possible.

     

    (h)           Any
      element of compensation herein described may be re-evaluated and revised but
      not
      reduced by joint written agreement of the Executive and the Board of
      Directors.  Factors to be considered in the course of said
      re-evaluation and revision include performance specific to the Company as well
      as what is customary for like companies in the industry.

     

    4.           Termination.  The
      Executive’s employment hereunder with the Company may be terminated under the
      following circumstances:

     

    (a)           Death
      or Disability.  If the Executive shall die or become entitled to
      the receipt of benefits under the Company’s long-term disability plan, if any,
      the Company may terminate the Executive’s employment hereunder for death or
“Disability,” as applicable.

     

    (b)           Cause.  The
      Company may terminate the Executive’s employment hereunder for
      Cause.  For purposes of this Agreement, the Company shall have “Cause”
to terminate the Executive’s employment hereunder upon:

     

    (i)           the
      failure by the Executive to substantially perform the Executive’s duties for the
      Company, whether or not during the Term (other than any such failure resulting
      from the Executive’s Disability which shall be subject to the provisions of
      Section 4(a));

     

    (ii)           the
      willful violation by the Executive of any of the Executive’s material
      obligations hereunder;

     

    (iii)           the
      willful engaging by the Executive in misconduct which is materially injurious
      to
      the business or reputation of the Company or any of its affiliates;
      or

     

    (iv)           the
      Executive’s conviction of a felony (or plea of nolo
      contendere).

     

    Notwithstanding
      the foregoing, if practicable under the circumstances, the Executive shall
      not
      be terminated for Cause without:

     

    (A)           delivery
      of a written notice to the Executive setting forth the reasons for the Company’s
      intention to terminate the Executive’s employment hereunder for
      Cause;

     

    (B)           the
      failure of the Executive to cure the nonperformance, violation or misconduct
      described in the notice referred to in clause (A) of this paragraph, if cure
      thereof is possible, to the reasonable satisfaction of the Board, within fifteen
      (15) days of the Executive’s receipt of such notice; and

     

    
      
        
        

      

      
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    (C)           an
      opportunity for the Executive to be heard before the Board.

     

    (c)           Good
      Reason.  The Executive may terminate his employment hereunder for
“Good Reason” upon the occurrence, without the Executive’s consent, of any of
      the following events that has occurred within ninety (90) days of Executive
      giving written notice thereof to the Company and that has not been cured within
      thirty (30) days after written notice thereof has been given to the Company
      by
      the Executive;

     

    (i)           a
      material diminution in the Executive’s authority, duties or
      responsibilities;

     

    (ii)           a
      material diminution in the Executive’s Base Salary;

     

    (iii)           a
      material change in the geographic location at which Executive must perform
      the
      services; or

     

    (iv)           any
      other action or inaction that constitutes a material breach by the Company
      of
      this Agreement.

     

    (d)           Without
      Cause.  The Company may terminate the Executive’s employment
      hereunder without Cause.

     

    (e)           Without
      Good Reason.  The Executive may terminate the Executive’s
      employment hereunder without Good Reason.

     

    (f)           Termination
      Obligations.

     

    (i)           The
      Executive hereby acknowledges and agrees that all personal property and
      equipment furnished to or prepared by the Executive in the course of or incident
      to his or her employment, belongs to the Company and shall, if physically
      returnable, be promptly returned to the Company upon termination of his or
      her
      employment.  “Personal property” includes, without limitation, all
      books, manuals, records, reports, notes, contracts, lists, blueprints, and
      other
      documents, or materials, or copies thereof, and Proprietary Information (as
      defined below).  Following termination, Executive will not retain any
      written or other tangible material containing any proprietary or confidential
      information belonging to the Company.

     

    (ii)           Upon
      termination of his employment, Executive shall be deemed to have resigned from
      all offices, board positions and directorships then held with the Company,
      and
      will execute a letter of resignation if requested.

     

    5.           Compensation
      upon Termination.

     

    (a)           Death
      or Disability.  If the Executive’s employment with the Company
      hereunder is terminated on account of the Executive’s death or Disability
      pursuant to Section 4(a), the Company shall as soon as practicable pay to the
      Executive or the Executive’s estate, as applicable, or as may be directed by the
      legal representatives of the Executive or the Executive’s estate, as


     

    
      
        
        

      

      
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    applicable,
      any Base Salary and/or Bonus accrued and due to the Executive under Section
      3(a)
      and/or 3(b) through the date of the Executive’s death or termination for
      Disability, as applicable.  Other than the foregoing, the Company
      shall have no further obligations to the Executive hereunder.

     

    (b)           By
      the Company for Cause or By the Executive Without Good Reason.  If
      the Executive’s employment with the Company hereunder is terminated by the
      Company for Cause pursuant to Section 4(b) or by the Executive without Good
      Reason pursuant to Section 4(e), the Company shall as soon as practicable
      pay the Executive any Base Salary accrued and due to the Executive under
      Section 3(a) through the Executive’s date of termination and the Executive
      shall forfeit his entire unpaid Bonus, if any.  Other than the
      foregoing, the Company shall have no further obligations to the Executive
      hereunder.

     

    (c)           By
      the Company Without Cause or By the Executive for Good Reason.  If
      the Executive’s employment with the Company hereunder is terminated by the
      Company Without Cause pursuant to Section 4(d) or the Executive for Good
      Reason pursuant to Section 4(c), the Company shall as soon as practicable
      (until such earlier time that the Executive violates the provisions of Section
      6(b) or (c) wherein the Company shall have no further obligations to the
      Executive hereunder) (i) pay the Executive any Base Salary and/or pro-rata
      Bonus accrued and due to the Executive under Section 3(a) and/or 3(b)
      through the Executive’s date of termination; and (ii) pay to the Executive
      on the final day of employment, or as soon as practicable thereafter, an amount
      equal to the greater of:  (A) twelve (12) months of Executive’s
      then current Base Salary or (B) Four Hundred Thousand Dollars ($400,000
      USD); and (iii) at the Company’s expense, continuation of Executive’s
      medical, dental and life insurance benefits coverage for a period of no less
      than one year following said termination date; and (iv) pay any amounts
      unconditionally accrued under any pension or benefit plans of the Company in
      accordance with the terms thereof; and (v) pay amounts earned,
      unconditionally accrued or owing to Executive but not yet paid, including,
      without limitation, any salary (including deferred salary, if applicable),
      bonus
      or stock options plus accrued interest thereon earned through the date of
      termination, and (vi) provide other benefits unconditionally accrued and
      vested on the date of termination, if any, in accordance with applicable plans
      and programs of the Company.

     

    The
      Executive shall not be required to mitigate the amount of his severance benefit
      payable pursuant to this Section 5(c).

     

    6.           Restrictive
      Covenants.

     

    (a)           Reasonable
      Covenants.  It is expressly understood by and between the Company
      and the Executive that the covenants contained in this Section 6 are an
      essential element of this Agreement and that but for the agreement by the
      Executive to comply with these covenants and thereby not to diminish the value
      of the organization and goodwill of the Company or any affiliate or subsidiary
      of the Company, including relations with their employees, clients, customers
      and
      accounts, the Company would not enter into this Agreement.  The
      Executive has independently consulted with his legal counsel and after such
      consultation agrees that such covenants are reasonable and proper.

     

    
      
        
        

      

      
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    (b)           No
      Diversion of Customers; No Solicitation of Employees, Etc.  During
      the Term and for twelve (12) months after the end of the Term the Executive
      shall not:

     

    (i)           divert
      to any competitor of the Company or any of its affiliates or subsidiaries,
      any
      customer, supplier or business partner of the Company or any of its affiliates
      or subsidiaries; or

     

    (ii)           solicit
      or encourage any officer, employee or consultant of the Company or any of its
      affiliates or subsidiaries to leave the employ of the Company or any of its
      affiliates or subsidiaries for employment by or with any competitor of the
      Company or any of its affiliates or subsidiaries;

     

    provided,
      however, that the Executive may invest in stocks, bonds or other
      securities of any competitor of the Company or any of its affiliates or
      subsidiaries if:

     

    (A)           such
      stocks, bonds, or other securities are listed on any national or regional
      securities exchange or have been registered under Section 12(g) of the
      Securities Exchange Act of 1934;

     

    (B)           his
      investment does not exceed, in the case of any class of the capital stock of
      any
      one issuer, one percent (1%) of the issued and outstanding shares, or, in the
      case of other securities, one percent (1%) of the aggregate principal amount
      thereof issued and outstanding; and

     

    (C)           such
      investment would not prevent, directly or indirectly, the transaction of
      business by the Company and/or of its affiliates or subsidiaries with any state,
      district, territory or possession of the United States or any governmental
      subdivision, agency or instrumentality thereof by virtue of any statute, law,
      regulation or administrative practice.

     

    If,
      at
      any time, the provisions of this Section 6(b) shall be determined to be invalid
      or unenforceable by reason of being vague or unreasonable as to area, duration
      or scope of activity, this Section 6(b) shall be considered severable and shall
      become and shall be immediately amended solely with respect to such area,
      duration and scope of activity as shall be determined to be reasonable and
      enforceable by the court or other body having jurisdiction over the matter
      and
      the Executive hereby agrees that this Section 6(b) as so amended shall be valid
      and binding as though any invalid or unenforceable provision had not been
      included herein.  Except as provided in this Section 6, nothing in
      this Agreement shall prevent or restrict the Executive from engaging in any
      business or industry in any capacity.

     

    (c)           Nondisclosure
      of Confidential Information.  The Executive shall keep secret and
      confidential and shall not disclose to any third party in any fashion or for
      any
      purpose whatsoever, any information regarding this Agreement, or any other
      information regarding the Company or its affiliates or subsidiaries which is
      not
      available to the general public, and/or  not generally known outside
      the Company or any such affiliate or subsidiary, to which he has or shall have
      had access at any time during the course of his employment with the Company,
      including, without limitation, any information relating to the Company’s (and
      its affiliates’ or subsidiaries’):

     

    
      
        
        

      

      
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    (i)           business,
      operations, plans, strategies, prospects or objectives;

     

    (ii)           products,
      technologies, processes, specifications, research and development operations
      and
      plans;

     

    (iii)           customers
      and customer lists;

     

    (iv)           distribution,
      sales, service, support and marketing practices and operations;

     

    (v)           financial
      condition and results of operations;

     

    (vi)           operational
      strengths and weaknesses; and

     

    (vii)           personnel
      and compensation policies and procedures.

     

    Notwithstanding
      the foregoing provisions of this Section 6, the Executive may discuss this
      Agreement with the members of his immediate family and with his personal legal
      and tax advisors and may disclose the existence of his employment with the
      Company to any third party.  Executive understands that this Agreement
      and the terms hereof shall be filed with the U.S. Securities and Exchange
      Commission and disclosed in the Company’s securities filings and disclosures, as
      required by law.

     

    (d)           Specific
      Performance.  Without intending to limit the remedies available to
      the Company or its affiliates or subsidiaries, the Executive hereby agrees
      that
      damages at law would be an insufficient remedy to the Company or its affiliates
      or subsidiaries in the event that the Executive violates any of the provisions
      of this Section 6, and that, in addition to money damages, the Company or its
      affiliates or subsidiaries may apply for and, upon the requisite showing, have
      injunctive relief in any court of competent jurisdiction to restrain the breach
      or threatened breach of or otherwise to specifically enforce any of the
      covenants contained in this Section 6.

     

    7.           Successors.  This
      Agreement cannot be assigned by any of the parties hereto without the prior
      written consent of the other party hereto, except that it shall be binding
      automatically on any successors and assigns of all or substantially all of
      the
      business and/or assets of the Company (whether direct or indirect, by purchase,
      merger, consolidation or otherwise).

     

    8.           Inventions.  Executive
      agrees to make prompt and full written disclosure to the Company, to hold in
      trust for the sole right and benefit of the Company, and hereby assigns to
      the
      Company, or its designee, all right, title, and interest in and to any and
      all
      inventions, original works of authorship, developments, concepts, improvements
      or trade secrets, whether or not patentable or registrable under copyright
      or
      similar laws, which Executive may solely or jointly conceive or develop or
      reduce to practice, or cause to be conceived or developed or reduced to
      practice, during the period of time Executive is in the employ of the Company
      that (1) are created using the Company’s facilities, supplies, information,
      trade secrets or time; (2) directly or indirectly relate to or arise out of
      the
      business of the Company, including without limitation the research and
      development activities, of the Company; or (3) relate to or arise out of any
      task 

     

    
      
        
        

      

      
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    assigned
      to Executive or work Executive performs for the Company (collectively
“Inventions”).  Employee further acknowledges that all original works
      of authorship which are made by the Employee (solely or jointly with others)
      within the scope of and during the period of employment with the Company and
      which are protectible by copyright are “works made for hire,” as that term is
      defined in the United States Copyright Act.  The assignment of
      inventions does not apply to an invention that Executive developed entirely
      on
      his or her time without using the Company’s equipment, supplies, facilities or
      trade secret information except for those inventions that either:  (1)
      relate at the time of conception or reduction to practice of the invention
      to
      the Company’s business, or actual or demonstrably anticipated research or
      development of the Company; or (2) result from any work performed by Executive
      for the Company.

     

    9.           Maintenance
      of Records.  Executive agrees to keep and maintain adequate and
      current written records of all Inventions made by Executive (solely or jointly
      with others) during the term of Executive’s employment with the
      Company.  The records will be in the form of notes, sketches,
      drawings, and any other format that may be specified by the
      Company.  The records will be available to and remain the sole
      property of the Company at all times.

     

    10.           Arbitration.  Except
      as provided in Section 6(d), all controversies, claims or disputes arising
      out
      of or relating to this Agreement shall be settled by binding arbitration before
      and under the Commercial Rules of the American Arbitration Association, as
      the
      sole and exclusive remedy of either party, and judgment upon such award rendered
      by the arbitrators(s) may be entered in any court of competent
      jurisdiction.  The costs of arbitration shall be borne by the
      unsuccessful party or otherwise as determined by the arbitrators in their
      discretion.

     

    11.           Governing
      Law.  The validity, interpretation, construction and performance
      of this Agreement shall be governed by the laws of the State of California
      without regard to conflicts of law principles.

     

    12.           Amendments.  No
      provision of this Agreement may be modified, waived or discharged unless such
      waiver, modification or discharge is agreed to in writing signed by the
      Executive and such officers of the Company as may be specifically designated
      for
      such purpose by the Board.

     

    13.           Entire
      Agreement.  This Agreement sets forth the entire agreement of the
      parties hereto in respect of the subject matter contained herein and supersedes
      all prior agreements, promises, covenants, arrangements, communications,
      representations or warranties, whether oral or written, by any officer, employee
      or representative of any party hereto.

     

    14.           Indemnification.  The
      Company shall indemnify the Executive to the full extent permitted by applicable
      Delaware law, as well as its charter and by-laws, for all liabilities incurred
      by the Executive in connection with his reasonable execution of his duties
      hereunder.  The Company agrees to provide directors and officers
      insurance coverage on behalf of the Company and its directors and
      officers.

     

    15.           Survival.  The
      obligations of the parties hereto contained in Sections 5, 6, 10 and 14 shall
      survive the termination of this Agreement.

     

    
      
        
        

      

      
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    16.           Notices.  For
      all purposes of this Agreement, notices and all other communications under
      or in
      connection with this Agreement shall be deemed to have been duly given when
      delivered or mailed by United States certified or registered mail, return
      receipt requested, postage prepaid, addressed as follows:

     

    


    If
      to the
      Executive:               Stephen
      Ferrone

    220
      Savanna Ct.

    Lake
      Forest,
      Illinois  60045

    


    If
      to the
      Company:               Immunosyn
      Corporation

    4225
      Executive Square

    Suite
      260

    LaJolla,
      California  92037

    


     

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

     

    
      


      
        	 	
                IMMUNOSYN
                  CORPORATION

                 

                 

                 

              
	 	
                By:

              	 /s/
                Douglas A. McClain Jr.
	 	 	
                Name: 
                  Douglas A. McClain Jr.

              
	 	 	
                Title: 
                  Chief Financial Officer

              


      

       

       

      
        	 	
                /s/
                  Stephen D. Ferrone

              
	 	
                STEPHEN
                  D. FERRONE

              


      

      
 

    

     

    
      
        
        

      

      
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