exv10w4



 




Exhibit 10.4









October 31, 2006




To:    Jeffrey Janus




From:    International Stem Cell Corporation




Dear Jeff:




The following sets for the terms of your proposed employment with International Stem Cell
Corporation (“ISCC”). ISCC hereby offers you employment with ISCC on the terms and conditions set
forth below, such employment to commence October 31, 2006. As referred to herein, “ISCC” shall
include the public entity of which ISCC expects to become a wholly owned subsidiary (the “Parent”)
through a pending “reverse merger takeover (the “RTO”) and Lifeline Cell Technology, LLC, as the
context requires.




	 	1.	 	You will be President of ISCC and Lifeline and report directly to the Boards of
Directors of those entities. Your duties and responsibilities will include leadership and
management of the ISCC’s and Lifeline’s research and product development, marketing,
product production, and sales. Responsibilities may be added, removed or otherwise
modified, as the Board deems necessary. It is expected that Jeff Krstich will continue to
be the CEO of ISCC and that you and he will function in collaboration rather than in a
senior/subordinate role. At such time as Lifeline ceases to be a wholly owned subsidiary,
these roles may be modified as needed.

	 
	 	2.	 	You will serve on the Boards of both ISCC and Lifeline.







	 	3.	 	You will receive a base salary of $220,000, payable semi-monthly. Your status will
be salary exempt. In anticipation of your collaborative relationship to the CEO, your
base salary shall at all times during the 24 months hereafter be not less than that paid
to the CEO of ISCC, but bonuses may be based on different standards reflecting your
differing areas of primary responsibility. You will be entitled to 15 days paid vacation
each year, accruing on a monthly basis. You will be eligible for coverage under such group
health plan and other benefits as the Company provides to comparable employees, as they
are established. (A group health plan is now being established and is expected to be in
place prior to your commencement date. You will be paid a bonus of $50,000 on or before
December 31, 2007 if milestones mutually agreed between you and Board of ISCC are met.
Because you are already a significant shareholder, you will not receive any additional
stock options at commencement of employment, but will be eligible for future stock option
awards based on performance and results as President of ISCC and Lifeline
without regard or deduction for your existing stock ownership. Options will vest monthly
over a 4-year term.





 


 









 
















	 	4.	 	If you are requested to relocate to San Diego County, California. Your actual moving
expenses will be reimbursed up to a maximum of $25,000. Additional reasonable relocation
expenses incurred by you may be reimbursed to you upon consideration and approval by the
Board of Directors of Lifeline. In the event that you are required to move a second time,
ISCC will pay all reasonable moving costs associated with such move and, if such move is
required within 2 years of your move to San Diego County, ISCC will reimburse you for your
moving costs and any actual loss in value upon the sale of your home in San Diego County
in an amount not to exceed $200,000, provided such home is placed on the market at or near
the time of such relocation.







	 	5.	 	Employment with ISCC or Parent is at the mutual consent of the employee and the
company. Accordingly, while the company has every hope that employment relationships will
be mutually beneficial and rewarding, employees and the company retain the right to
terminate the employment relationship at will, at any time, with or without cause.
However, termination pay equal to 12 months of the initial base salary shall be paid in
the event of termination by the company for any reason other than “for cause”, as
customarily defined. Please note that no individual has the authority to make any contrary
agreement or representation. Accordingly, this constitutes a final and fully binding
integrated agreement with respect to the at-will nature of the employment relationship.
How will the termination pay be paid? Over time, lump sum?







	 	6.	 	You agree to abide by the Company’s policies and procedures, including those set
forth in a Company Employee Handbook when such document is drafted. You will be required
to sign the signature page of this Employee Handbook when it is completed.







	 	7.	 	For a period of one year after your termination of employment for any reason, you
agree not to, directly or indirectly, hire, attempt to hire, induce or entice the hire of
or interview for hire any employee of ISCC or Lifeline or any former employee who had been
an employee at any time during the one year period prior to your termination.







	 	8.	 	You further agree that you will upon termination of employment, return to ISCC and
Lifeline all books, records, computer files, manuals, customer lists and other written,
typed, printed, or electronic materials, whether furnished by ISCC or Lifeline or prepared
by you, which contain any information relating to the ISCC or Lifeline businesses, and you
further agree that you will neither make nor retain copies of such materials after
termination of employment.





 


 









 
















	 	9.	 	If you voluntary terminate your employment under this Agreement, you will not, for a
period of one year after you are no longer employed by ISCC or Lifeline, solicit customers
of ISCC or Lifeline directly or indirectly, either as a proprietor, stockholder, partner,
officer, employee, or otherwise of any other entity engaged in the stem cell business in
the United States, producing and/or selling same or substantially similar products and
services as ISCC or Lifeline produces and/or sells at such time your employment with ISCC
and/or Lifeline may terminate.







	 	10.	 	In the event of any lawsuit or charge filed with an administrative agency, or other
form of litigation brought against or involving you as a result of alleged activity,
negligence, or any other conduct by you in connection with your duties and
responsibilities on behalf of ISCC or Lifeline, ISCC shall provide and pay for legal
defense on your behalf, as well as indemnify you against any judgment or other liability
that may result from such proceedings unless such activity or conduct represented willful
misconduct on your part.







	 	11.	 	You will be required to sign an Employee Proprietary Information Agreement as well as the
necessary tax and benefit enrollment forms before starting full time employment. You will
also be required to provide proof of your identity and authorization to work in the United
States as required by Federal immigration laws.







	 	12.	 	Jeffrey, we look forward to you joining our effort and hope the opportunity will be
mutually rewarding. To confirm that you agree to the terms stated in this letter, please
sign, date and return the enclosed copy of this letter.






Sincerely,




International Stem Cell Corporation




By:      /S/ KENNETH C. ADLRICH     

Kenneth C. Aldrich

Chairman of the Board




This will acknowledge my acceptance of this offer of employment.



	 	 	 
	/S/ JEFFREY JANUS
	 	 
	Jeffrey Janus

	 	Date:      October 31, 2006