**EXHIBIT 10.4**

 

**FOURTHAMENDMENT TO EMPLOYMENT AGREEMENT**

 

This Fourth Amendment to Employment Agreement (the “Amendment”) is madeand entered into by and between Enchira Biotechnology Corporation, a Delawarecorporation (the “Company”), and Daniel J. Monticello (the “Employee”), as ofthis 15th day of August, 2002 (the “Effective Date”).

 

WHEREAS, the Employee and the Company entered into that certainEmployment Agreement dated January 31, 1996, as amended by that certain FirstAmendment to Employment Agreement dated April 10, 1998, as further amended bythat certain Second Amendment to Employment Agreement dated April 9, 2001, andas further amended by that certain Third Amendment to Employment Agreementdated April 2, 2002, to be effective as of January 1, 2002 (collectively, the“Agreement”), all of which are incorporated herein in their entirety byreference; and

 

WHEREAS, the Company and Employee entered into that certain Settlementand Release Agreement (the “Original Release”) dated May 7, 2002 whereby inexchange for certain retention payments by the Company to Employee, whichEmployee accepted, Employee agreed to, among other things, forgo certainseverance obligations set forth in his Agreement; and

 

WHEREAS, concurrently with the execution of the Original Release, theCompany paid to Employee an initial payment of $80,000 and deposited with theSouthwest Bank of Texas, N.A., a Texas banking corporation, a second payment inthe amount of $80,000 to be held in escrow (the “Second Payment”) payable to Employeeunder certain conditions as set forth in Section 1B. of the Original Release,including, but not limited to, the termination of the Agreement and theexecution of a settlement and release agreement containing terms substantiallysimilar to those provided in the Original Release (the “Settlement and ReleaseAgreement”); and

 

WHEREAS, the Company and Employee entered into the Settlement andRelease Agreement dated of even date herewith which waives the requirementsthat the Agreement be terminated and that Employee resign as an officer and/ordirector of the Company as conditions to Employee’s receipt of the SecondPayment; and

 

WHEREAS, Employee and the Company desire to extend the term of theAgreement from its stated expiration date of August 15, 2002.

 

NOW, THEREFORE, for and in consideration of the mutual covenants andpromises and representations contained herein, and other good and valuableconsideration, the receipt and sufficiency of which are acknowledged herein,the Company and Employee agree as follows:

 

# 1.        Section 4.1of the Agreement is hereby amended by deleting the section in its entirety andsubstituting the following in replacement thereof:

 

4.1                                 The term of this Agreement shall commenceon the Effective Date and shall continue on a month-to-month basis (i) unlessearlier terminated as

 

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hereinafter provided or (ii) until the completion of a sale, license orother disposition of all or substantially all of the assets of the Company.

 

# 2.        Section 4.9of the Agreement is hereby amended by deleting the section in its entirety andsubstituting the following in replacement thereof:

 

4.9                                 In the event of Employee’s termination ofemployment from the Company pursuant to Sections 4.5 or 4.6 hereof, or in theevent that Employee’s employment with the Company, or successor entity, isterminated within twelve months following a Change of Control, except forCause, all outstanding options to purchase stock of the Company held byEmployee and not previously vested (excluding any that have lapsed, terminatedor expired) will vest automatically upon such termination, and Employee shallhave a period of 90 days to exercise such options.

 

# 3.        Company andEmployee acknowledge that Employee has received his Second Payment of $80,000,with such interest thereon, if any, as contemplated by the Original Release andthe Settlement and Release Agreement.

 

# 4.        ThisAmendment shall be governed by the laws of the State of Texas.

 

# 5.        ThisAgreement, as amended by this Amendment, and the Settlement and ReleaseAgreement supersede any and all other agreements, either oral or in writing,between the Company and Employee with respect to the employment of Employee bythe Company and contains all of the representations, covenants and agreementsbetween the Company and the Employee with respect to such employment.  The Agreement, as amended hereby, may not belater modified except by a further writing signed by the Company and theEmployee, and no term of this Agreement may be waived except by writing signedby the party waiving the benefit of such term.

 

# 6.        Except asmodified by this Amendment, all other terms of the Agreement shall continue infull force and effect without modification.

 

# 7.        ThisAmendment may be executed in one or more counterparts, each of which shall bedeemed an original and all of which, taken together, constitute one and thesame instrument.

 

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IN WITNESS WHEREOF, the parties have executed this Fifth Amendment toEmployment Agreement in duplicate originals as of the date first above written.

 
|   | ENCHIRA  BIOTECHNOLOGY CORPORATION |
|--------|------------------------------------|
|   |                               |
|   |                               |   |
|   | By:                                |   /s/  Paul G. Brown, III |   |
|   |                               |  Paul  G. Brown, III, President |   |
|   |                               |   |   |
|   |                               |   |   |
|   |   Daniel  J. Monticello  |   |
|   | Daniel  J. Monticello              |   |
|        |                                    |  |  |  |

 

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