exv10w11



 







Exhibit 10.11




Tatum CFO Partners, LLP




Interim Executive Services Agreement




	 	 	 
	 

	 	August 1, 2005






Mr. Javier Baz

Chairman

Lifeline Therapeutics, Inc.

6400 S. Fiddler’s Green Circle, Suite 1750

Englewood, CO 80111




Dear Javier:



Tatum CFO Partners, LLP (“Tatum”) understands that Lifeline Therapeutics, Inc. (the “Company”)
desires to engage a partner of Tatum to serve as interim chief executive officer. This Interim
Executive Services Agreement sets forth the conditions under which such services will be provided.




Services; Fees



Tatum will make available to the Company Brenda March (the “Tatum Partner”) as of July 19, 2005
(“Effective Date”), who will serve as interim chief executive officer of the Company. The Tatum
Partner will become an employee and, a duly elected or appointed officer of the Company and subject
to the supervision and direction of the board of directors of the Company. Tatum will have no
control or supervision over the Tatum Partner.



The Company will pay the Tatum Partner directly a salary of $1,200.00 a day (“Salary”). During the
term of this agreement the Company will also issue to the Tatum Partner warrants to purchase 2,400
shares of common stock per month, or prorated for each fraction of a month, payable within five
business days after the end of the month for which they apply, with the exercise price of each
warrant equal to the VWAP (as defined below) for that month and with an exercise period of two
years. The “VWAP” means, for each month, the volume weighted average trading price for the
Company’s common stock for each Friday in that month determined by multiplying the number of shares
of common stock in each trade made on each Friday in that month by the sale price for that trade,
and dividing the sum of all those amounts for all Fridays in that month by the total number of
shares of common stock traded during all of the Fridays in that month.



In addition, the Company will pay directly to Tatum a fee of $300.00 a day as partial compensation
for resources provided. During the term of this agreement the Company will also issue to Tatum
warrants to purchase 600 shares of common stock per month, or prorated for each fraction of a
month, payable within five business days after the end of the month for which they apply, with the
exercise price of each warrant equal to the VWAP for that month and with an exercise period of two
years.



The Company will have no obligation to provide the Tatum Partner any health or major medical
benefits, stock, or bonus payments. The Tatum Partner will remain on his or her current medical
plan.



As an employee, the Tatum Partner will be eligible for any Company employee retirement and/or
401(k) plan and for vacation and holidays consistent with the Company’s policy as it applies to





 









 







senior management, and the Tatum Partner will be exempt from any delay periods otherwise required
for eligibility.




Payments; Deposit



Payments to Tatum should be made by direct deposit through the Company’s payroll, or by an
automated clearing house (“ACH”) payment at the same time as payments are made to the Tatum
Partner. If such payment method is not available and payments are made by check, Tatum will issue
invoices to the Company, and the Company agrees to pay such invoices no later than ten (10) days
after receipt of invoices.



The Company will reimburse the Tatum Partner directly for out-of-pocket expenses incurred by the
Tatum Partner in providing services hereunder to the same extent that the Company is responsible
for such expenses of senior managers of the Company.



Company agrees to pay Tatum and to maintain a security deposit of $0.00 for the Company’s future
payment obligations to both Tatum and the Tatum Partner under this agreement (the “Deposit”). If
the Company breaches this agreement and fails to cure such breach as provided in this agreement,
Tatum will be entitled to apply the Deposit to its damages resulting from such breach. Upon
termination or expiration of this agreement, Tatum will return to the Company the balance of the
Deposit remaining after application of any amounts to unfulfilled payment obligations of the
Company to Tatum or the Tatum Partner as provided for in this agreement.




Converting Interim to Permanent



The Company will have the opportunity to make the Tatum Partner a permanent member of Company
management at any time during the term of this agreement by entering into another form of Tatum
agreement, the terms of which will be negotiated at such time.




Hiring Tatum Partner Outside of Agreement



During the twelve (12)-month period following termination or expiration of this agreement, other
than in connection with another Tatum agreement, the Company will not employ the Tatum Partner, or
engage the Tatum Partner as an independent contractor, to render services of substantially the same
nature as those to be performed by the Tatum Partner as contemplated by this agreement. The
parties recognize and agree that a breach by the Company of this provision would result in the loss
to Tatum of the Tatum Partner’s valuable expertise and revenue potential and that such injury will
be impossible or very difficult to ascertain. Therefore, in the event this provision is breached,
Tatum will be entitled to receive as liquidated damages an amount equal to twenty-five percent
(25%) of the Tatum Partner’s Annualized Compensation (as defined below), which amount the parties
agree is reasonably proportionate to the probable loss to Tatum and is not intended as a penalty.
If, however, a court or arbitrator, as applicable, determines that liquidated damages are not
appropriate for such breach, Tatum will have the right to seek actual damages. The amount will be
due and payable to Tatum upon written demand to the Company. For this purpose, ''Annualized
Compensation’’ will mean monthly salary equivalent to what the Tatum Partner would receive on a
full-time basis under this agreement multiplied by twelve (12), plus the maximum amount of any
bonus for which the Tatum Partner was eligible with respect to the then current bonus year.




Term & Termination



Effective upon thirty (30) days’ advance written notice, the Company may terminate this agreement
at any time, such termination to be effective on the date specified in the notice,





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provided that such date is no earlier than thirty (30) days after the date of delivery of the
notice. Tatum will continue to render services and will be paid during such notice period. Tatum
may terminate this agreement on the same terms and conditions described in the preceding two
sentences, except that (i) any notice of termination by Tatum cannot be delivered prior to 30 days
before the six-month anniversary of the effective date of this agreement, and (ii) any such
termination by Tatum cannot be effective before the six-month anniversary of this agreement.



Tatum retains the right to terminate this agreement immediately if (1) the Company is engaged in or
asks the Tatum Partner to engage in or to ignore any illegal or unethical activity, (2) the Tatum
Partner dies or becomes disabled, (3) the Tatum Partner ceases to be a partner of Tatum for any
other reason, or (4) upon written notice by Tatum of non-payment by the Company of amounts due
under this agreement. For purposes of this agreement, disability will be as defined by the
applicable policy of disability insurance or, in the absence of such insurance, by Tatum’s
management acting in good faith.



In the event that either party commits a breach of this agreement, other than for reasons described
in the above paragraph, and fails to cure the same within seven (7) days following delivery by the
non-breaching party of written notice specifying the nature of the breach, the non-breaching party
will have the right to terminate this agreement immediately effective upon written notice of such
termination.




Insurance



The Company will maintain its current directors’ and officers’ insurance, or a policy substantially
as beneficial to the Tatum Partner, at all times while this agreement remains in effect.



Furthermore, the Company will maintain such insurance coverage with respect to occurrences arising
during the term of this agreement for at least three years following the termination or expiration
of this agreement or will purchase a directors’ and officers’ extended reporting period, or “tail,”
policy to cover the Tatum Partner.




Disclaimers, Limitations of Liability & Indemnity



Tatum assumes no responsibility or liability under this agreement other than to render the services
called for hereunder and will not be responsible for any action taken by the Company in following
or declining to follow any of Tatum’s advice or recommendations. Tatum represents to the Company
that Tatum has conducted its standard screening and investigation procedures with respect to the
Tatum Partner becoming a partner in Tatum, and the results of the same were satisfactory to Tatum.
Tatum disclaims all other warranties, either express or implied. Without limiting the foregoing,
Tatum makes no representation or warranty as to the accuracy or reliability of reports,
projections, forecasts, or any other information derived from use of Tatum’s resources, and Tatum
will not be liable for any claims of reliance on such reports, projections, forecasts, or
information. Tatum will not be liable for any non-compliance of reports, projections, forecasts, or
information or services with federal, state, or local laws or regulations. Such reports,
projections, forecasts, or information or services are for the sole benefit of the Company and not
any unnamed third parties.



In the event that any partner of Tatum (including without limitation the Tatum Partner to the
extent not otherwise entitled in his or her capacity as an officer of the Company) is subpoenaed or
otherwise required to appear as a witness or Tatum or such partner is required to provide evidence,
in either case in connection with any action, suit, or other proceeding initiated by a third party
or by the Company against a third party, then the Company shall reimburse Tatum for





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the costs and expenses (including reasonable attorneys’ fees) actually incurred by Tatum or such
partner and provide Tatum with compensation at Tatum’s customary rate for the time incurred.



The Company agrees that, with respect to any claims the Company may assert against Tatum in
connection with this agreement or the relationship arising hereunder, Tatum’s total liability will
not exceed the total amount paid to Tatum and the Tatum Partner hereunder.



Tatum will not be liable in any event for incidental, consequential, punitive, or special damages,
including without limitation, any interruption of business or loss of business, profit, or
goodwill.




Arbitration



If the parties are unable to resolve any dispute arising out of or in connection with this
agreement, either party may refer the dispute to arbitration by a single arbitrator selected by the
parties according to the rules of the American Arbitration Association (“AAA”), and the decision of
the arbitrator will be final and binding on both parties. Such arbitration will be conducted by
the Denver, Colorado, office of the AAA. In the event that the parties fail to agree on the
selection of the arbitrator within thirty (30) days after either party’s request for arbitration
under this paragraph, the arbitrator will be chosen by AAA. The arbitrator may in his discretion
order documentary discovery but shall not allow depositions without a showing of compelling need.
The arbitrator will render his decision within ninety (90) days after the call for arbitration.
The arbitrator will have no authority to award punitive damages. Judgment on the award of the
arbitrator may be entered in and enforced by any court of competent jurisdiction. The arbitrator
will have no authority to award damages in excess or in contravention of this agreement and may not
amend or disregard any provision of this agreement, including this paragraph. Notwithstanding the
foregoing, either party may seek appropriate injunctive relief from a court of competent
jurisdiction, and either party may seek injunctive relief in any court of competent jurisdiction.




Miscellaneous



Tatum will be entitled to receive all reasonable costs and expenses incidental to the collection of
overdue amounts under this Resources Agreement, including but not limited to attorneys’ fees
actually incurred.



Neither the Company nor Tatum will be deemed to have waived any rights or remedies accruing under
this agreement unless such waiver is in writing and signed by the party electing to waive the right
or remedy. This agreement binds and benefits the respective successors of Tatum and the Company.



Neither party will be liable for any delay or failure to perform under this agreement (other than
with respect to payment obligations) to the extent such delay or failure is a result of an act of
God, war, earthquake, civil disobedience, court order, labor dispute, or other cause beyond such
party’s reasonable control.



The provisions concerning payment of compensation and reimbursement of costs and expenses,
limitation of liability, directors’ and officers’ insurance, and arbitration will survive the
expiration or any termination of this agreement.



This agreement will be governed by and construed in all respects in accordance with the laws of the
State of Colorado, without giving effect to conflicts-of-laws principles.




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The terms of this agreement are severable and may not be amended except in writing signed by the
party to be bound. If any portion of this agreement is found to be unenforceable, the rest of the
agreement will be enforceable except to the extent that the severed provision deprives either party
of a substantial benefit of its bargain.



Nothing in this agreement shall confer any rights upon any person or entity other than the parties
hereto and their respective successors and permitted assigns and the Tatum Partner.



Each person signing below is authorized to sign on behalf of the party indicated, and in each case
such signature is the only one necessary.




Bank Lockbox Mailing Address for Deposit and Fees:




Tatum CFO Partners, LLP

P.O. Box 403291

Atlanta, GA 30384-3291




Electronic Payment Instructions for Deposit and Fees:




	 	 	 	 	 
	 	 	Bank Name: Bank of America
	 	 	Branch: Atlanta
	 

	 	Routing Number:
	 	For ACH Payments: 061 000 052
	 

	 	 	 	For Wires: 026 009 593
	 	 	Account Name: Tatum CFO Partners, LLP
	 	 	Account Number: 003 279 247 763
	 	 	Please reference  Lifeline Therapeutics, Inc.  in the body of the wire.





Please sign below and return a signed copy of this letter to indicate the Company’s agreement with
its terms and conditions.



We look forward to serving you.



Sincerely yours,




	 	 	 	 	 
	TATUM CFO PARTNERS, LLP

	 	Acknowledged and agreed by:
	 	 
	 
	 	 	 	 
	/s/
Doug Payne
	 	 	 	 
	 

Signature

	 	Lifeline Therapeutics, Inc. 	 	 
	 
	 	 	 	 
	 
	 	/s/ Javier Baz	 	 
	 

Doug Payne

	 	 

Signature 
	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	Javier Baz	 	 
	Area Managing Partner for TATUM CFO
	 	 	 	 
	PARTNERS, LLP

	 	 

Chairman
	 	 
	 
	 	 	 	 
	 

	 	 

(Date)
	 	 







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