Exhibit
10.4
  Execution
Copy
 
  TERMINATION
AGREEMENT
  THIS AGREEMENT (this “Agreement”) is made as of the
6th
day of October, 2008 by and between Elias Vamvakas (the “Employee”), a resident of the
Province of Ontario, and OccuLogix, Inc. (the “Employer”), a corporation
incorporated under the laws of the State of Delaware, and having its executive
offices at 2600 Skymark Avenue, Building 9, Suite 201, Mississauga, Ontario, L4W
5B2.
  WHEREAS, the Employer and the
Employee entered into an employment agreement dated as of September 1, 2004,
pursuant to which the Employee has been serving the Employer as its Chairman and
Chief Executive Officer (the “Employment
Agreement”);
  AND WHEREAS,capitalized terms
used in this Agreement, but not otherwise defined, shall have the respective
meanings attributed to such terms in the Employment Agreement;
  AND WHEREAS,the Employee and
the Employer mutually have agreed that the services of the Employee as an
executive are no longer required and, accordingly, have agreed to the
termination of the Employee’s employment with the Employer pursuant to Section
8.1.2 of the Employment Agreement;
  AND WHEREAS,the Employee and
the Employer hereby further acknowledge and agree that, pursuant to Section 9 of
the Employment Agreement, when the Employee’s employment under the Employment
Agreement has been terminated by the Employer for any reason other than Just
Cause pursuant to Section 8.1.2 of the Employment Agreement, the Employee is
entitled to receive from the Employer, in addition to accrued but unpaid salary,
if any, a lump sum payment equal to the greater of (i) U.S.$1,400,000 and (ii)
24 months’ of his Basic Salary and Bonus and 5% of his Basic Salary in respect
of his entitlement to Benefits, less any amounts payable to the Employee in lieu
of notice where a Stop Work Notice has been given pursuant to Section 8.2 of the
Employment Agreement and any amounts owing by the Employee to the Employer for
any reason;
  AND WHEREAS,the Employee has
not been given a Stop Work Notice pursuant to Section 8.2 of the Employment
Agreement;
  AND WHEREAS,between February
1, 2008 and the date hereof inclusive, the Employee worked for the Employer at
50% of his Basic Salary;
  AND WHEREAS,the Employer owes
severance pay to each of the former members, and the other soon-to-be former
member, of the senior management team of the Employer, being Nozait Chaudry-Rao,
John Cornish, David C. Eldridge, Julie A. Fotheringham, Stephen J. Kilmer, Suh
Kim, Stephen B. Parks, Thomas P. Reeves and Stephen H. Westing, and,
notwithstanding William G. Dumencu’s continuing employment with the Employer,
voluntarily has agreed to pay him the amount that would be owing to him pursuant
to his employment agreement if his employment were terminated without cause (all
such individuals, collectively, the “Affected
Individuals”);
  
  AND WHEREAS,the Employee has
agreed that the Severance Amount (defined below) may be paid to him, as to 100%,
by the grant of stock options under the Employer’s 2002 Stock Option Plan, as
amended (the “Stock Option
Plan”), in a number to be calculated in accordance with the methodology
therefor described in the Proxy Statement for the Employer’s Annual and Special
Meeting of Stockholders held on September 30, 2008 (the “Proxy
Statement”);
  AND WHEREAS,the Employer will
effect a recapitalization in which the issued and outstanding shares of its
common stock will be reverse split in a ratio of 1:25 (the “Reverse Stock
Split”);
  AND WHEREAS,the Employment
Agreement is further amended by this Agreement;
  AND WHEREAS,the Employee has
been elected a non-executive member of the Employer’s board of directors (the
“Board”) and has been
appointed the Chairman of the Board and, in such capacity, will be remunerated
in accordance with the Board’s policies with respect to the compensation of
directors;
  NOW, THEREFORE,in
consideration of the mutual promises and covenants contained in this Agreement
(the receipt and sufficiency of which are hereby acknowledged by the parties
hereto), the parties hereto agree as follows:
  1.
              TERMINATION
  1.1           The
Employee and the Employer hereby agree that the Employee’s employment with the
Employer is terminated pursuant to Section 8.1.2 of the Employment Agreement,
effective at the close of business on the date hereof (the “Termination
Date”).  The Employer shall pay the Employee, on the next
regularly scheduled payday, all accrued (to and including the Termination Date)
but unpaid salary.  For greater certainty, the Employee hereby waives
the requirement, under Section 8.1.2 of the Employment Agreement, to provide 24
months’ prior written notice to the Employee of the Employer’s intention to
terminate his employment with the Employer.
  2.
              RETURN
      OF PROPERTY
  2.1           The
Employee hereby certifies that he has returned to the Employer all property of
the Employer in the Employee’s possession, including, without limitation, all
keys, business cards, computer hardware, including, without limitation,
Blackberry units, printers, mice and other hardware accessories, and computer
software.  The Employee hereby further certifies that he has returned
to the Employer, or destroyed, all tangible material embodying Confidential
Information in any form whatsoever, including, without limitation, all paper
copy copies, summaries and excerpts of Confidential Information and all
electronic media or records containing or derived from Confidential
Information.
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  3.
              SEVERANCE
  3.1           The
Employee and the Employer hereby agree that, for reason of the termination of
the Employee’s employment with the Employer pursuant to Section 8.1.2 of the
Employment Agreement and effected by this Agreement, the Employee is entitled to
receive from the Employer U.S.$1,570,007.76 (the “Severance Amount”), being an
amount equal to:  (i) 24 months’ of his Basic Salary and Bonus; plus (ii) 5% of his
Basic Salary in respect of his entitlement to Benefits; minus (iii)
U.S.$12,533.50, being the aggregate amount that the Employer disbursed in 2008,
on the Employee’s behalf, for certain perquisites to which he is entitled under
the Employment Agreement.  For clarity, the purposes of calculating
the Severance Amount, “Basic Salary” means the amount of the Employee’s Basic
Salary on January 31, 2008.
  3.2           Concurrently
with the discharge by the Employer of the severance obligations owing to the
Affected Individuals, the Employer shall pay the Severance Amount to the
Employee, as to 100%, by the grant of stock options under the Stock Option Plan,
in a number calculated in accordance with the methodology therefor described in
the Proxy Statement (the “Severance Stock Options”),
provided that the Severance Stock Options shall be exercisable immediately upon
grant, have a term expiring on the tenth anniversary of the date of grant and
have an exercise price determined and set in accordance with the policy of the
Employer’s board of directors with respect to the granting of stock options and
provided, further, that the number of the Severance Stock Options and the
exercise price thereof shall be adjusted appropriately following the Reverse
Stock Split, in accordance with the provisions of the Stock Option
Plan.
  4.
              RELEASE
      AND TERMINATION
  4.1           The
Employee hereby agrees, on behalf of himself and his administrators, heirs,
assigns and anyone claiming through him, to release completely and forever
discharge the Employer and its affiliates and subsidiaries, and their respective
officers, directors, shareholders, agents, servants, representatives,
underwriters, successors, heirs and assigns, from any and all claims, demands,
obligations and causes of action (“Claims”), of any nature
whatsoever, whether known or unknown, which the Employee ever had, now has or
might have in the future as a result of the Employee’s employment with the
Employer as its Chairman and Chief Executive Officer or the termination thereof
hereunder, including, without limitation, any claim relating to the Employment
Agreement or the termination thereof hereunder or any claim relating to any
violation of any Canadian federal or provincial statute or regulation, any claim
for wrongful discharge or breach of contract or any claim relating to Canadian
federal or provincial laws (including, without limitation, the Employment Standards Act(Ontario) and the Ontario Human Rights Code), provided, however,
that such release and discharge shall be effective only upon the payment in full
by the Employer of the Severance Amount pursuant to Article 3 of this
Agreement.  For greater certainty, the release and discharge by the
Employee pursuant to this Section 4.1 are not, and shall not be construed as, a
release or discharge of any Claims resulting from or in connection with, or
arising from or otherwise relating to, the Employee’s past, present or future
service as a member of the Board or any action or omission in such capacity. In
addition, nothing herein shall be construed as depriving the Employee of (i) any
indemnification rights to which he is entitled under the Amended and Restated
By-laws of the Employer or under the Indemnification Agreement, dated as of the
date hereof, between the Employer and the Employee or (ii) any protection to
which he may be entitled, on, prior to or after the Termination Date, under the
Employer’s directors’ and officers’ liability insurance policy from time to
time.
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  4.2           Section
12 of the Employment Agreement (Non-Competition) is hereby amended by replacing,
in the first paragraph thereof, the words “which is the same as or substantially
similar to or which competes with or would compete with the business carried on
during the Employment Period or at the end thereof, as the case may be, by the
Corporation or any of its Subsidiaries.” with the words “(i) the Corporation’s
RHEO business and/or (ii) the business of OcuSense, Inc., as each of them was
carried on during the Employment Period.”.
  4.3           The
Employment Agreement is hereby terminated and rendered null and void, save and
except for those provisions thereof that are expressly stated to survive the
termination thereof, including, without limitation, Section 12
(Non-Competition), as amended by Section 4.2 of this Agreement, and Sections 13
(No Solicitation of Patients), 14 (No Solicitation of Employees) 15
(Confidentiality) and 16 (Remedies).  The Employee hereby agrees to
abide by such provisions, including, for greater certainty, Section 12 of the
Employment Agreement (Non-Competition), as amended by Section 4.2 of this
Agreement.
  5.
              FUTURE
      EMPLOYMENT
  5.1           The
mitigation by the Employee of any damages or losses arising from the termination
hereunder of his employment with the Employer and the termination of the
Employment Agreement hereunder (including, without limitation, by obtaining
other employment) shall not, in any way, derogate from, or otherwise affect, the
Employee’s rights or the Employer’s obligations under this
Agreement.  For greater certainty, and without derogating from the
generality of the foregoing statement, no amount to be paid by the Employer
under this Agreement shall be reduced, or made refundable to the Employer, by
any compensation earned by the Employee as a result of employment by another
employer or otherwise after the Termination Date.
  6.
              THIRD
      PARTY COMMUNICATIONS
  6.1           In
consideration of the mutual promises and covenants contained herein, each of the
parties hereto hereby agrees that he and it will not make any statements to, or
initiate or participate in any discussions with, any other person, including,
without limitation, the Employer’s customers, which are derogatory, disparaging
or injurious to the reputation of the Employee or the Employer.  This
Section 6.1, in no way, shall be construed as prohibiting either party hereto
from responding truthfully to any question or interrogatory to which such party
is requested to respond.
  7.
              ACKNOWLEDGEMENT
  7.1
              The
      Employee hereby acknowledges that:  4
  (a)
              He
      has had sufficient time to review and consider this Agreement
      thoroughly;
  (b)
              He
      has read and understands the terms of this Agreement and his obligations
      hereunder;
  (c)
              He
      has been given an opportunity to obtain independent legal advice, or such
      other advice as he may desire, concerning the interpretation and effect of
      this Agreement; and
  (d)
              He
      is entering this Agreement voluntarily and without any pressure from the
      Employer.
  8.
              MISCELLANEOUS
  8.1           The
headings in this Agreement are included solely for convenience of reference and
shall not affect the construction or interpretation hereof.
  8.2           The
parties hereto expressly agree that nothing in this Agreement shall be construed
as an admission of liability.
  8.3           This
Agreement shall be binding upon, and inure to the benefit of, the parties hereto
and their respective heirs, trustees, administrators, successors and
assigns.
  8.4           This
Agreement constitutes the entire agreement between the parties hereto pertaining
to the subject matter of the termination of the Employee’s employment with the
Employer.  This Agreement supersedes and replaces all prior
agreements, if any, written or oral, with respect to such subject matter and any
rights which the Employee may have by reason of any such prior agreements or by
reason of the Employee’s employment with the Employer.  There are no
representations, warranties or agreements between the parties hereto in
connection with the subject matter of this Agreement, except as specifically set
forth in this Agreement.  No reliance is placed on any representation,
opinion, advice or assertion of fact made by the Employer or any of its
officers, directors, agents or employees to the Employee, except to the extent
that the same has been reduced to writing and included as a term of this
Agreement.  Accordingly, there shall be no liability, either in tort
or in contract, assessed in relation to any such representation, opinion, advice
or assertion of fact, except to the extent aforesaid.
  8.5           Each
of the provisions contained in this Agreement is distinct and severable, and a
declaration of invalidity or unenforceability of any provision or part thereof
by a court of competent jurisdiction shall not affect the validity or
enforceability of any other provision hereof.
  8.6           This
Agreement shall be governed by, and construed in accordance with, the laws of
the Province of Ontario and the federal laws of Canada applicable
therein.
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  8.7           This
Agreement may be signed in counterparts and delivered by facsimile transmission
or other electronic means, and each of such counterparts shall constitute an
original document, and such counterparts, taken together, shall constitute one
and the same instrument.
  
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  IN WITNESS WHEREOF,the
parties have executed this Agreement as of the date set forth
above.
  
  OCCULOGIX,
      INC.By:
                  /s/ Suh KimSuh
      KimGeneral
      Counsel
 
  /s/
      Elias VamvakasSignature
      of Witness
                
                Elias
      VamvakasName
      of Witness (please
      print)


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