Document:

<PAGE>   1
                                                                   Exhibit 10.53

                             OFFICER'S CERTIFICATE

     I, the undersigned, do hereby certify and represent that:

     1.   I am the duly elected Executive VP, Senior Business and Finance
Officer of deCODE genetics, Inc., a Delaware Corporation.

     2.   Pursuant to Rule 306(a) of Regulation S-T, the Power of Attorney,
dated October 10, 2000, which is attached as part of exhibit 10.53, to deCODE
genetics, Inc.'s Annual Report on Form 10-K is a fair and accurate English
translation of a document prepared in the Icelandic language.

     IN WITNESS WHEREOF, I have signed this Officer's Certificate in my capacity
as Executive VP, Senior Business and Finance Officer of deCODE genetics, Inc. on
this 15 day of March, 2001.

                                        By:    /s/ Hannes P. Smarason
                                               ---------------------------------
                                        Name:  Hannes P. Smarason
                                        Title: Executive VP, Senior Business and
                                               Finance Officer
<PAGE>   2
                                                                   Exhibit 10.53

                                      STOCK
                               PURCHASE AGREEMENT

     1.   Islensk erfoagreining ehf., Lynghals 1, 110 Reykjavik, Iceland, an
          Icelandic private limited company, hereinafter referred to as
          "PURCHASER", a subsidiary of deCODE genetics, Inc. ("deCODE")
          registered in Delaware, USA, with a principle offices at Lynghals 1,
          110 Reykjavik, for the purpose of this Agreement represented by its
          sole board member Kari Stefansson;

     2.   KACE TRADERS LTD. a company under the laws of Cyprus, Arcimidous, 24A,
          Egkomi, D.C. 2411, Nicosa, Cyprus, for the purpose of this Agreement
          represented by Gunnar Sturluson, hereinafter referred to as "VENDOR";

     3.   THE "FOUNDERS". Mr. Einar Stefansson, Idno. 190552-2769, Fjaroarasi
          13, 110 Reykjavik, and Mr. Thorsteinn Loftsson, Idno. 010350-7519,
          Sorlaskjoli 44, 107 Reykjavik;

WHEREAS:

     1.   Vendor is the owner of 64.32% of the shares ('the sold Shares') in
          CYCLOPS EHF., Idno. 420394-2259, the nominal value being ISK 338,000 a
          private limited liability company under Icelandic law, "THE COMPANY",
          each share with a par value of 1 ISK. Nominal value of all outstanding
          shares of the company is ISK 525,500.

     2.   Purchaser wishes to purchase the sold Shares and Vendor wishes to sell
          the same;

     3.   Whereas the Company itself is the owner of shares of nominal value of
          ISK 11.983.

     4.   The "FOUNDERS" have entered into a contractual relationship Mr.
          Stefansson with the Purchaser for employment and Mr. Loftsson with the
          Company for employment;

HAVE AGREED AS FOLLOWS:

                                    ARTICLE 1
                               CONTRACT DOCUMENTS

The following documents are annexed to this agreement and shall be included as
contractual documents forming the relationship between the parties:

     1.   The annual accounts 1999 for the Company.

     2.   Preliminary financial statement for year 2000.

                                                                               1
<PAGE>   3
                                    ARTICLE 2
                               PURCHASE OF SHARES

     1.   Subject to the terms and conditions hereof Vendor sells to the
          Purchaser, and the Purchaser buys and accepts from the Vendor the
          following shares: 64,32% of the share capital of the Company. The
          nominal value of the sold Shares is ISK 338,000.

     2.   At the closing of this Agreement, all outstanding options, warrants
          and other rights to purchase capital stock of the Company (whether or
          not then exercisable) shall be terminated. Purchaser is purchasing the
          remaining shares in the Company from an unrelated third party
          shareholder at the time of the closing of this purchase.

                                    ARTICLE 3
                                 PURCHASE PRICE

     1.   Purchaser and Vendor declare that the purchase and sale of the Shares
          is effected in return for 110,000 (one hundred and ten thousand)
          assigned Common Stock shares in deCODE genetics, Inc. (the "deCODE
          SHARES"), assigned for the benefit of the Vendor. A portion of the
          deCODE shares are subject to a repurchase option pursuant to the terms
          and conditions set forth on Joint Escrow Agreement Appendix 1.

                                    ARTICLE 4
                        THE COMPANY'S ANNUAL ACCOUNTS

          Except for any changes mentioned in this agreement the balance sheet
          of the Company's Annual Accounts for 1999 has not changed in the
          period between 31 December 1999 and the date of this agreement.

                                    ARTICLE 5
                              CONDITIONS PRECIDENT

     1.   The closing of the Transaction is contingent on satisfaction of the
          following conditions:

          The Founders will continue to work for the Company and the Purchaser
          and are in agreement with the Purchaser on the terms thereof.
          The Founders will terminate their preemptive rights to purchasing
          stock of the Company which become effective at this transaction and
          also at the purchase, by the Purchaser, of the minority shares from a
          third party on behalf of the company and on their own behalf.

     2.   Vendor hereby represents and warrants against the Purchaser as
          follows:

          (a)  The Company at present owns 3 patents and 4 patent applications:

               1.   Thorsteinn Loftsson, "Cyclodextrin/drug complexation", U.S.
                    Patent No.: 5,324,718 (June 28, 1994).

               2.   Thorsteinn Loftsson, "Cyclodextrin complexation", European
                    Patent No.: 0579435 (March 17, 1999).

                                                                               2
<PAGE>   4
               3.   Thorsteinn Loftsson, "Cyklodextrinflettun", Icelandic Patent
                    Application No.: 4049 (July 8, 1993).

               4.   Thorsteinn Loftsson, "Cyclodextrin Complexation", U.S.
                    Patent No. 5,472,954 (December 5, 1995).

               5.   Thorsteinn Loftsson, "Cyclodextrin Complexation", Singapore
                    Patent Application No. 9607266-5 (1996).

               6.   Thorsteinn Loftsson, Mar Masson and Einar Stefansson,
                    "High-Energy Cyclodextrin Complexes", U.S. Provisional
                    Patent Application No. 60/075,544 (Filed: February 23, 1998)
                    U.S. Patent Application No. (Filed February 16, 1999).

               7.   Thorsteinn Loftsson, Mar Masson and Einar
                    Stefansson, "High-Energy Cyclodextrin Complexes", PCT
                    Application No.: PCT/IS99/00003 (Filed February 16, 1999).

         (b)      The company at present owns: All other patents and/or patent
                  applications that have been filed or will be filed, claiming
                  priority from the patents/patent applications listed in a) and
                  the subject matter claimed therein.

         (c)      The Company is presently in negotiations with:
                  AstraZeneca, Inc.,
                  Procter&Gamble, Inc.
                  Merck Co., Inc.;
                  for upcoming projects in connection with cyclodextrin.

         (d)      The Company has not aggregate liabilities outside the balance
                  sheet of the Company's Annual accounts 1999, and preliminary
                  financial statement for 2000.

                                    ARTICLE 6
                         REPRESENTATIONS AND WARRANTIES

     1.   The Vendor hereby explicitly and unconditionally guarantees, warrants,
          represents, undertakes and agrees with the Purchaser that:

     a)   Vendor is sole, lawful owner of the Shares sold and transferred under
          this Stock Purchase Agrement and its representatives signing this
          Agreement are fully entitled and vested with all required power of
          authority to transfer the Shares to Purchaser;

     b)   The Shares sold and transferred under this deed have been fully paid
          up and correctly registered at the Icelandic registry of limited
          companies ("hlutafelagaskra");

     c)   The Company is a company properly established and existing and in good
          standing under Icelandic law, entitled to carry on such business as is
          described in this Agreement;

     d)   The annexed Annual Accounts and preliminary financial statement fairly
          state the Company's assets and liabilities as of the date hereof and
          that there are no liabilities, neither actual, contingent or latent,
          which are not

                                                                               3
<PAGE>   5
          disclosed in those balance sheets, no other liabilities will arise or
          amounts become due that those connected with the normal day-to-day
          management of the Company;

     e)   There exist no options or other rights under which any person may
          demand the transfer of one or more of the Shares sold and transferred
          under this deed;

     f)   No person holds any right of lien or any other right to pledge in
          respect of the Shares sold and transferred under this deed, and no
          person is entitled to demand that he be granted any such right of lien
          or other right of pledge and that none of the Shares have been seized;

     g)   No registered depository receipts of the Shares sold and transferred
          under this deed have been issued or assigned;

     h)   No person is entitled to demand from the Company that shares in the
          share capital of the Company be issued to him or to a third party. No
          person is entitled to options and warrants in the Company except for
          as specifically disclosed at time of the closing;

     i)   Vendor will not and can not make any claims whatsoever vis-a-vis the
          Company regarding the payments of a final or interim dividend over
          past financial years or over the current financial year;

     j)   No resolutions or decisions exist, having been made by the general
          meeting of shareholders or any other body of the Company before the
          above transfer balance sheet date, which have not yet been executed by
          the effective date of the sale of the Shares;

     k)   No legal actions have been taken against the Company at this moment
          nor are there any grounds known to Vendor or Founders for taking legal
          action against the Company;

     l)   No legal actions have been taken by the Public Prosecutor for the
          dissolution of the Company;

     m)   All obligations concerning any tax law and/or social security law have
          been complied with, that no liabilities concerning tax law and/or
          social security laws exist, except those disclosed in the attached
          balance sheet, as per the effective date of the sale of the Shares,
          and thus further the Company has conformed to obligations concerning
          any other legal provisions;

                                    ARTICLE 7
                           PREFERENCE PURCHASE RIGHTS

          Vendor declares that, in as far there are preference purchase rights,
          such as preemptive rights, concerning the transfer of the Shares sold
          and transferred by this deed, which preference rights are based on the
          rule prohibiting the sale of the Shares in the articles of
          association, this prohibiting rule will not be applicable.
          Vendor declares that no third party consent is needed for the transfer
          of the ownership of shares to take place from Vendor to Purchaser.

                                                                               4
<PAGE>   6
                                    ARTICLE 8
                                  DUE DILIGENCE

          Purchaser has performed due diligence on the operations, condition and
          affairs of the Company as he deems appropriate.

                                    ARTICLE 9
                                 NON-DISCLOSURE

          Each party will keep confidential and will not use or disclose to
          unauthorized third parties, and will cause its representatives and
          authorized third parties to whom disclosure is made to keep
          confidential and not use or disclose, (except in connection with
          evaluating and implementing the Transaction) all confidential
          information obtained from the other as a result of its review and
          investigation of the other in connection with the Transaction.

                                   ARTICLE 10
                            VENUE AND APPLICAPLE LAW

          In as far as parties have a free choice of law the validity
          construction and performance of this agreement will be governed by the
          laws of Iceland and all disputes arising out of or in connection with
          this agreement will be brought before the competent Court in Iceland.

Thus made, in fourfold drawn up and signed in Reykjavik, on 8 November, 2000.

                               For the Purchaser:

                              /s/ Kari Stefansson
                             ----------------------
                                 Kari Stefansson

                                 for the Vendor:

                              /s/ Gunnar Sturluson
                             ----------------------
                                Gunnar Sturluson

                                  the Founders:

                              /s/ Einar Stefansson
                             ----------------------
                                Einar Stefansson

                            /s/ Thorsteinn Loftsson
                            -----------------------
                              Thorsteinn Loftsson

                                                                               5

<PAGE>   7
                     Consent on the behalf of deCODE, Inc.,
                           to issue the deCODE shares

                              /s/ Kari Stefansson
                          ---------------------------

LEGALIZATION OF SIGNATURE

/s/ illegible

080263-2289
                                                                               6

<PAGE>   8
                                   Attachments

                          to a STOCK PURCHASE AGREEMENT
                       BETWEEN ISLENSK ERFDAGREINING EHF.
                                KACE traders Ltd.
                              dated 8 November 2000
                  about the purchase of shares in Cyclops ehf.
                               ("the Transaction")

APPENDIX 1
Joint Escrow Agreement and Instructions on the Issuance and delivery of the
deCODE shares

APPENDIX 2
Net royalty payment agreement

APPENDIX 3
Warranties and Representations of Founders

                                                                               7
<PAGE>   9
ATTACHMENTS
to a STOCK PURCHASE AGREEMENT
BETWEEN ISLENSK ERFDAGREINING EHF.
KACE traders Ltd.
dated 8 November 2000
about the purchase of shares in Cyclops ehf.
("the Transaction")

APPENDIX 1 - JOINT ESCROW AGREEMENT AND INSTRUCTIONS ON THE ISSUANCE AND
DELIVERY OF deCODE SHARES

<PAGE>   10
APPENDIX 1

                             JOINT ESCROW AGREEMENT
                               AND INSTRUCTIONS ON
                          THE ISSUANCE AND DELIVERY OF
                                  deCODE SHARES

AMONG:            The parties to the Stock Purchase Agreement
                  (deCODE, Vendor and the Founders);

                  and

                  Kari Stefansson, Secretary of deCODE,
                  as Escrow Agent

WHEREAS:

         A. Following the Transaction, the Founders have agreed to continue to
provide services to deCODE and/or the Company, Mr. Stefansson as an employee of
the Purchaser and Mr. Loftsson as an employee of the Company, for a period of at
leat four years after the closing of the Transaction.

         B. A portion of the consideration being provided to Vendor in the form
of deCODE shares in consideration for the Shares of the Company are being
provided as compensation for these services to be provided by the Founders.

         C. Therefore, the Vendor and the Purchaser have agreed that such
portion of the deCODE shares will be held in escrow and subject to repurchase by
deCODE in the event that either of the Founders fails to continue to provide
services to deCODE or the Company during such four year period for any reason
(other than death).

         NOW, THEREFORE, the parties have agreed as follows:

     1.  80.000 of the deCODE shares will unconditionally be delivered to the
         Vendor at the closing of the Transaction under the Agreement.

     2.  30.000 of the deCODE shares being issued to the Vendor at the closing
         of the Transaction pursuant to the Agreement will be subject to the
         repurchase option by deCODE as described below (the "Repurchase
         Option"):

         (a) In the event that either of the Founders cease to provide services
         to deCODE as a result of termination of a Founder's employment or
         consulting arrangement by either party for any reason (except as a
         result of death of a Founder), deCODE shall have the right to exercise
         its Repurchase Option. deCODE may, by exercising its Repurchase Option
         at any time within ninety (90) business days after said cessation or
         such longer period as may be determined by deCODE if such later
         repurchase is deemed necessary by deCODE for treatment of its stock as
         Qualified Small Business Stock under

<PAGE>   11
         Section 1202 of the Internal Revenue Code of 1986, as amended and
         regulations promulgated thereunder, repurchase from the Vendor at the
         par value per share of such deCODE shares (the "Repurchase Price"), up
         to but not exceeding the number of deCODE shares which have not vested
         under the provisions of paragraph (b) below. As used herein, employment
         and consulting arrangement with deCODE shall include employment or a
         consulting arrangement with a "parent" or "subsidiary" of deCODE as
         those terms are defined in Sections 424(e) and (f) of the Internal
         Revenue Code of 1986, as amended.

         (b) The right of deCODE to exercise its Repurchase Option as to the
         maximum portion of the deCODE shares specified in the event of
         termination shall be by reference to the following schedule:

                  (1)      7,500 of the deCODE shares issued to the Vendor shall
                           vest on the first anniversary of the closing of the
                           Transaction under the Agreement; and

                  (2)      7,500 of the deCODE shares issued to the Vendor shall
                           vest on the second anniversary of the closing of the
                           Transaction under the Agreement; and

                  (3)      7,500 of the deCODE shares issued to the Vendor shall
                           vest on the third anniversary of the closing of the
                           Transaction under the Agreement; and

                  (4)      7,500 of the deCODE shares issued to the Vendor shall
                           vest on the fourth anniversary of the closing of the
                           Transaction under the Agreement.

         (c) Nothing in this Annex shall affect in any manner whatsoever the
         right or power of deCODE (or a parent or subsidiary of deCODE) to
         terminate either Founder's employment or consulting arrangement.

         (d) The Repurchase Option shall be exercised by written notice signed
         by an officer of deCODE and delivered or mailed to Vendor, the Founders
         and the Escrow Agent at their respective addresses set forth in the
         Agreement or such other address as may be provided by such party from
         time to time. Such notice shall identify the number of deCODE shares to
         be purchased and shall notify the Vendor and the Founders of the time,
         place and date for settlement of such purchase, which shall be
         scheduled by deCODE within one hundred fifty (150) business days from
         the date of cessation of the employment or consulting arrangment.

         (e) If, from time to time during the term of the Repurchase Option:

                  (1)      There is any stock dividend or other distribution of
                           cash and/or property, stock split or other change in
                           the character or amount of any of the outstanding
                           securities of deCODE genetics, Inc.; or

                  (2)      There is any consolidation, merger or sale of all, or
                           substantially all of the assets of deCODE genetics,
                           Inc.;
<PAGE>   12
         then, in such event, any and all new, substituted or additional
         securities or other property to which the Vendor is entitled by reason
         of its ownership of the deCODE shares which are subject to the
         Repurchase Option shall be immediately subject to the Repurchase Option
         with the same force and effect as the deCODE shares presently subject
         to the Repurchase Option. While the total Option Price shall remain the
         same after each such event, the Option Price per share of deCODE shares
         upon exercise of the Repurchase Option shall be appropriately adjusted.

         Upon the occurrence of any event specified in clause (b) above, the
         Repurchase Option may be assigned to any successor to deCODE, and the
         Repurchase Option shall apply if either of the Founders does not become
         or shall cease for any reason to be employed by or have a consulting
         arrangement with such successor (or its parent or subsidiaries). In
         such case, the references herein to "deCODE" shall be deemed to refer
         to such successor.

     3.  As security for the performance of the terms of the Repurchase Option
         by Vendor and the Founders, and to insure the availability for delivery
         of the deCODE shares subject to the Repurchase Option upon exercise of
         the Repurchase Option provided for above, the Vendor agrees, at the
         closing or the Transaction, to deliver to and deposit with the
         Secretary of deCODE ("Escrow Agent"), as Escrow Agent in the
         Transaction, three stock assignments duly endorsed (with date and
         number of shares blank) in the form attached hereto as Attachment A,
         together with a certificate or certificates evidencing all of the
         deCODE shares subject to the Repurchase Option; said documents are to
         be held by the Escrow Agent and delivered by said Escrow Agent pursuant
         to the following instructions:

         (a) In the event deCODE provides notice of its exercise of the
         Repurchase Option, deCODE, Vendor and the Founders hereby irrevocably
         authorize and direct the Escrow Agent to close the transaction
         contemplated by such notice in accordance with the terms of said
         notice, and to (i) date the stock assignments necessary for the
         transfer in question, (ii) fill in the number of shares being
         transferred, and (iii) deliver the same, together with the certificate
         evidencing the deCODE shares to be transferred, to deCODE against the
         simultaneous delivery to Vendor of the Option Price for the number of
         deCODE shares being purchased pursuant to the exercise of the
         Repurchase Option.

         (b) Vendor and the Founders: (i) irrevocably authorize deCODE to
         deposit with Escrow Agent any certificates evidencing deCODE shares to
         be held by Escrow Agent and any additions and substitutions to said
         shares as specified herein, and (ii) hereby irrevocably appoints Escrow
         Agent as attorney-in-fact and agent for the term of this escrow to
         execute with respect to such securities all documents necessary or
         appropriate to make such securities negotiable and complete any
         transaction herein contemplated.

         (c) Escrow Agent shall be obligated only for the performance of such
         duties as are specifically set forth herein and may rely and shall be
         protected in
<PAGE>   13
         relying or refraining from acting on any instrument reasonable believed
         by Escrow Agent to be genuine and to have been signed or presented by
         the proper party or parties. Escrow Agent shall not be personally
         liable for any act he may do or omit to do hereunder as Escrow Agent or
         as attorney-in-fact for Vendor or Founders while acting in good faith
         and in the exercise of good judgment, and any act done or omitted by
         Escrow Agent pursuant to the advice of his own attorneys shall be
         conclusive evidence of such good faith. Escrow Agent is authorized to
         disregard any and all warnings given by any of the parties or by any
         other person or corporation, excepting only orders or process of courts
         of law, and is authorized to comply with and obey orders, judgments or
         decrees of any court, in which case Escrow Agent shall not be liable to
         any of the parties or to any other person or entity by reason of such
         compliance, notwithstanding any such order, judgment or decree being
         subsequently reversed, modified, annulled, set aside, vacated or found
         to have been entered without jurisdiction.

     4.  Subject to provisions of paragraph 3 above, the Vendor shall exercise
         all rights and privileges of a shareholder of deCODE with respect to
         the deCODE shares.

     5.  Paragraphs 2 and 3 above shall terminate upon the exercise in full or
         expiration of the Repurchase Option, whichever occurs first.

     6.  The Vendor and the Founders shall reimburse deCODE for all costs
         incurred by deCODE in enforcing the performance of, or protecting its
         rights under, the Repurchase Option, including reasonable costs of
         investigation and attorney's fees. It is the intention of the parties
         that deCODE, upon exercise of the Repurchase Option and payment of the
         Option Price, pursuant to the terms of the Repurchase Option, shall be
         entitled to receive the deCODE shares, in specie, in order to have such
         deCODE shares available for future issuance without dilution of the
         holdings of other shareholders. Furthermore, it is expressly agreed
         between the parties that money damages are inadequate to compensate
         deCODE for the deCODE shares and that deCODE shall, upon proper
         exercise of the Repurchase Option, be entitled to specific enforcement
         of its rights to purchase and receive said deCODE shares.

     7.  Any notice required or permitted under this Agreement shall be given in
         writing and shall be deemed effectively given upon personal delivery,
         including delivery by express courier, or three (3) days after deposit
         with the local postal service, by registered or certified mail with
         postage and fees prepaid, addressed to each of the other parties
         entitled to such notice at the addresses set forth for each of deCODE,
         the Vendor and the Founders at the beginning of the Stock Purchase
         Agreement and, with respect to the Escrow Agent, to Kari Stefansson,
         Escrow Agent, at the address for deCODE, or at such other addresses as
         a party may designate by ten days' advance written notice to each of
         the other parties hereto.

     8.  This instrument shall be binding upon and inure to the benefit of the
         parties hereto and their respective successors and permitted assigns.
<PAGE>   14
     9.  This Agreement shall be governed by and interpreted and determined in
         accordance with the laws of the State of Delaware as such laws are
         applied by Delaware courts to contracts made and to be performed
         entirely in Delaware by residents of that state.

     ISLENSK ERFOAGREINING EHF.             ESCROW AGENT

     By: /s/ Kari Stefansson                /s/ Kari Stefansson
        --------------------------------    ------------------------------------
          Kari Stefansson, sole director         Kari Stefansson
                                                 Secretary of deCODE

     KACE TRADERS LTD.                      FOUNDERS

     By: /s/ Gunnar Sturluson               /s/ Einar Stefansson
        --------------------------------    ------------------------------------
          Gunnar Sturluson                       Einar Stefansson

     8 November 2000

                                            /s/ Thorsteinn Loftsson
                                            ------------------------------------
                                                 Thorsteinn Loftsson

<PAGE>   15
                                  ATTACHMENT A

                   STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE

         FOR VALUE RECEIVED, KACE traders Ltd., hereby sells, assigns, and
transfers unto deCODE genetics, Inc. a Delaware corporation (the "Company"),
pursuant to the Repurchase Option under that certain Stock Purchase Agreement,
dated 8 November, 2000, by and between the undersigned and the Company (the
"Agreement"),        shares of Common Stock of the Company standing in the
undersigned's name on the books of the Company represented by Certificate
No.        and does hereby irrevocably constitute and appoint the Company's
Secretary attorney to transfer said stock on the books of the Company with full
power of substitution in the premises. This Assignment may be used only in
accordance with and subject to the terms and conditions of the Agreement, in
connection with the repurchase of shares of Common Stock issued to the
undersigned pursuant to the Agreement, and only to the extent that such shares
remain subject to the Company's Repurchase Option under the Agreement.

Dated: 20, December 2000                 /s/ Gunnar Sturluson
      ------------------------------     --------------------------------------
                                         (Signature)

                                                  KACE traders Ltd.
                                         --------------------------------------
                                         (Print Name)

<PAGE>   16
                                  STOCK POWER

     FOR VALUE RECEIVED, ______________________________________________________
hereby sells, assigns and transfers unto ______________________________________
_______________________________ Shares of the common stock of deCODE genetics,
Inc. standing in my name on the books of said Corporation represented by
Certificate(s) No(s) ______________________________________ and does hereby
irrevocably constitute and appoint ____________________________________
attorney to transfer the said stock on the books of said Corporation with full
power of substitution in the premises.

Dated____________________________

                                   For KACE Traders

                                   /s/ Gunnar Sturluson
                                   ______________________________________
                                   (This signature must be identical to the
                                   name as written on the face of the
                                   certificate)
<PAGE>   17
                                  STOCK POWER

     FOR VALUE RECEIVED, ______________________________________________________
hereby sells, assigns and transfers unto ______________________________________
_______________________________ Shares of the common stock of deCODE genetics,
Inc. standing in my name on the books of said Corporation represented by
Certificate(s) No(s) ______________________________________ and does hereby
irrevocably constitute and appoint ____________________________________
attorney to transfer the said stock on the books of said Corporation with full
power of substitution in the premises.

Dated____________________________

                                   For KACE Traders

                                   /s/ Gunnar Sturluson
                                   ______________________________________
                                   (This signature must be identical to the
                                   name as written on the face of the
                                   certificate)

<PAGE>   18
                                  STOCK POWER

     FOR VALUE RECEIVED, ______________________________________________________
hereby sells, assigns and transfers unto ______________________________________
_______________________________ Shares of the common stock of deCODE genetics,
Inc. standing in my name on the books of said Corporation represented by
Certificate(s) No(s) ______________________________________ and does hereby
irrevocably constitute and appoint ____________________________________
attorney to transfer the said stock on the books of said Corporation with full
power of substitution in the premises.

Dated____________________________

                                   For KACE Traders

                                   /s/ Gunnar Sturluson
                                   ______________________________________
                                   (This signature must be identical to the
                                   name as written on the face of the
                                   certificate)

<PAGE>   19
                                   APPENDIX 2
                          to a STOCK PURCHASE AGREEMENT
                       BETWEEN ISLENSK ERFDAGREINING EHF.
                                KACE traders Ltd.
                              dated 8 November 2000
                  about the purchase of shares in Cyclops ehf.
                               ("the Transaction")

WHEREAS:

     A.  Following the Transaction, the Founders have agreed to continue to
         provide services to deCODE and/or the Company, Mr. Stefansson as an
         employee of the Purchaser and Mr. Loftsson as an employee of the
         Company and the Purchaser would like to aknowlegde the existence of
         certain R&D projects they have contributed to as of the date of the
         signing of this agreement and as a result of certain ongoing projects
         the Purchaser has agreed to a following additional payment.

     B.  The Vendor shall receive: 30% of all net royalties from the ongoing R&D
         projects of Cyclops ehf. with Merck Co. (Carbonic Anhydrase Inhibitors)
         and Procter & Gamble (Triclosan in oral care products). Net royalties
         to be defined as gross income less attributable out of pocked expenses
         (or payments) such as for example translation, patent applications,
         infringement expenses, annual fees, costs for outside consultants and
         other direct expenses connected with the patents. All the expenses for
         such patents shall have been fully paid before any payments are made to
         the Vendor.)

8 November 2000.

For the Vendor:
/s/ Gunnar Sturluson
-----------------------------

For the Purhaser:
/s/ Tanya Zharov
-----------------------------
Tanya Zharov
signing on the basis of a written Power of Attorney.

The Founders:
/s/ Einar Stefansson
-----------------------------
Einar Stefansson

/s/ Thorsteinn Loftsson
-----------------------------
Thorsteinn Loftsson

LEGALIZATION OF SIGNATURES:

    /s/ Illegible

080263-2289

<PAGE>   20
                                   APPENDIX 3
                          to a STOCK PURCHASE AGREEMENT
                       BETWEEN ISLENSK ERFDAGREINING EHF.
                                KACE traders Ltd.
                              dated 8 November 2000
                  about the purchase of shares in Cyclops ehf.
                               ("the Transaction")

                         REPRESENTATIONS AND WARRANTIES
                                   OF FOUNDERS

     1.  Islensk erfoagreining ehf., Lynghals 1, 110 Reykjavik, Iceland, an
         Icelandic private limited company, hereinafter referred to as
         "PURCHASER" a subsidiary of deCODE genetics, Inc. ("deCODE") Delaware,
         USA, for the purpose of this Agreement represented by its sole board
         member Kari Stefansson

     2.  KACE TRADERS LTD. a company under the laws of Cyprus, Arcimidous, 24A,
         Egkomi, D.C. 2411, Nicosa, Cyprus, for the purpose of this Agreement
         represented by Einar Stefansson and Thorsteinn Loftsson, the majority
         of directors, hereinafter referred to as `VENDOR';

     3.  THE "FOUNDERS". Mr. Einar Stefansson, Idno. 190552-2769, Fjaroarasi 13,
         110 Reykjavik, and Mr. Thorsteinn Loftsson, Idno. 010350-7519,
         Sorlaskjoli 44, 107 Reykjavik;

WHEREAS:

     1.  Vendor is the owner of 64,32% of the shares (`the sold Shares') in
         CYCLOPS EHF., Idno. 420394-2259, the nominal value being ISK 338.000, a
         private limited liability company under Icelandic law, "THE COMPANY",
         each share with a par value of 1 ISK. Nominal value of all outstanding
         shares of the Company is ISK 525,500.

     2.  Purchaser wishes to purchase the sold Shares and Vendor wishes to sell
         the same and have today entered into a Stock Purchase Agreement for the
         sold Shares;

     3.  The Company itself is the owner of shares of nominal value of ISK
         11.983.

     4.  The "FOUNDERS" were the owners of the sold shares and the controlling
         majority shareholders of the Company, but recently conveyed them to the
         Vendor as a part of this transaction. The Purchaser therefore has
         requested the following representations and warranties from the
         Founders personally;

                                                                               1

<PAGE>   21
THE FOUNDERS HEREBY WARRANT AND REPRESENT THE FOLLOWING:

                                    ARTICLE 1
                          THE COMPANY'S ANNUAL ACCOUNTS

         Except for any changes mentioned in this agreement the balance sheet of
         the Company's Annual Accounts for 1999 has not changed in the period
         between 31 December 1999 and the date of this agreement.

                                    ARTICLE 2
                                  CONTINGENCIES

     1.  The closing of the Transaction is contingent on satisfaction of the
         following conditions:

         The Founders will continue to work for the Company and for the
         Purchaser are in agreement with the Purchaser on the terms thereof.

         The Founders will terminate their preemptive rights to purchasing stock
         of the Company which become effective at this transaction and also at
         the purchase, by the Purchaser, of the minority shares from a third
         party on behalf of the Company and on their own behalf.

     2.  Founders hereby represent and warrants against the Purchaser as
         follows:

            (a)   The Company at present owns 3 patents and 4 patent
                  applications:

               1. Thorsteinn Loftsson, "Cyclodextrin/drug complexation", U.S.
                  Patent No.: 5,324,718 (June 28, 1994).

               2. Thorsteinn Loftsson, "Cyclodextrin complexation", European
                  Patent No.: 0579435 (March 17, 1999).

               3. Thorsteinn Loftsson, "Cyklodextrinflettun", Icelandic Patent
                  Application No.: 4049 (July 8, 1993).

               4. Thorsteinn Loftsson, "Cyclodextrin Complexation", U.S. Patent
                  No. 5,472,954 (December 5, 1995).

               5. Thorsteinn Loftsson, "Cyclodextrin Complexation", Singapore
                  Patent Application No. 9607266-5 (1996).

               6. Thorsteinn Loftsson, Mar Masson and Einar Stefansson,
                  "High-Energy Cyclodextrin Complexes", U.S. Provisional Patent
                  Application No. 60/075,544 (Filed: February 23, 1998) U.S.
                  Patent Application No. (Filed February 16, 1999).

               7. Thorsteinn Loftsson, Mar Masson and Einar Stefansson,
                  "High-Energy Cyclodextrin Complexes", PCT Application No.:
                  PCT/IS99/00003 (Filed February 16, 1999).

            (b)   The company at present owns: All other patents and/or patent
                  applications that have been filed or will be filed, claiming
                  priority from the patents/patent applications listed in a) and
                  the subject matter claimed therein.

                                                                               2
<PAGE>   22
            (c)   The Company is presently in negotiations with:
                  AstraZeneca, Inc.,
                  Procter&Gamble, Inc.
                  Merck Co., Inc.;
                  for upcoming projects in connection with cyclodextrin.

            (d)   The Company has no aggregate liabilities outside the balance
                  sheet of the Company's Annual accounts 1999, and preliminary
                  financial statement for 2000.

            (e)   To the best knowledge of the Founders: (i) the Intellectual
                  Property does not infringe on the intellectual property of any
                  third party, (ii) no third party is infringing on any of the
                  Intellectual Property or claiming any ownership interest in
                  any of the Intellectual roperty, and (iii) no officer,
                  director or employee of the Company has disclosed any of the
                  Intellectual Property to any third party without appropriate
                  confidentiality obligations.

            (f)   The founders warrant and represent that all Intellectual
                  Property rights to the patents and patent applications listed
                  in (a) and (b) is held by the Company and not by them
                  personally.

                                    ARTICLE 3
                         REPRESENTATIONS AND WARRANTIES

     1.  The Founders hereby explicitly and unconditionally guarantee, warrant,
         represent, undertake and agree with the Purchaser that:

     a)  Vendor is sole, lawful owner of the Shares sold and transferred under
         this Stock Purchase Agrement and its representatives signing this
         Agreement are fully entitled and vested with all required power of
         authority to transfer the Shares to Purchaser;

     b)  The Shares sold and transferred under this deed have been fully paid up
         and correctly registered at the Icelandic registry of limited companies
         ("hlutafelagaskra");

     c)  The Company is a company properly established and existing and in good
         standing under Icelandic law, entitled to carry on such business as is
         described in this Agreement;

     d)  The annexed Annual Accounts and preliminary financial statement fairly
         state the Company's assets and liabilities as of the date hereof and
         that there are no liabilities, neither actual, contingent or latent,
         which are not disclosed in those balance sheets, no other liabilities
         will arise or amounts become due that those connected with the normal
         day-to-day management of the Company;

     e)  There exist no options or other rights under which any person may
         demand the transfer of one or more of the Shares sold and transferred
         under this deed;

     f)  No person holds any right of lien or any other right to pledge in
         respect of the Shares sold and transferred under this deed, and no
         person is entitled to demand that he be granted any such right of lien
         or other right of pledge and that none of the Shares have been seized;

                                                                               3
<PAGE>   23
     g)  No registered depository receipts of the Shares sold and transferred
         under this deed have been issued or assigned;

     h)  No person is entitled to demand from the Company that shares in the
         share capital of the Company be issued to him or to a third party. No
         person is entitled to options, warrants or other rights to company
         shares except for as specifically disclosed at time of the closing;

     i)  Vendor will not and can not make any claims whatsoever vis-a-vis the
         Company regarding the payments of a final or interim dividend over past
         financial years or over the current financial year;

     j)  No resolutions or decisions exist, having been made by the general
         meeting of shareholders or any other body of the Company before the
         above transfer balance sheet date, which have not yet been executed by
         the effective date of the sale of the Shares;

     k)  No legal actions have been taken against the Company at this moment nor
         are there any grounds known to Vendor or Founders for taking legal
         action against the Company;

     l)  No legal actions have been taken by the Public Prosecutor for the
         dissolution of the Company;

     m)  All obligations concerning any tax law and/or social security law have
         been complied with, that no liabilities concerning tax law and/or
         social security laws exist, except those disclosed in the attached
         balance sheet, as per the effective date of the sale of the Shares, and
         thus further the Company has conformed to obligations concerning any
         other legal provisions;

                                    ARTICLE 4
                           PREFERENCE PURCHASE RIGHTS

         The Founders declare that, in as far there are preference purchase
         rights, such as preemptive rights, concerning the transfer of the
         Shares sold and transferred by either the Stock Purchase Agreement
         between Purchaser and Vendor or between themselves and Vendor, which
         preference rights are based on the rule prohibiting the sale of the
         Shares in the articles of association, they warrant and represent that
         this prohibiting rule will not be applicable.

         The Founders declares that no third party consent is needed for the
         transfer of the ownership shares to take place from Vendor to
         Purchaser.

                                    ARTICLE 5
                                 NON-DISCLOSURE

         The Founders will keep confidential and will not use or disclose to
         unauthorized third parties, and will cause its representatives and
         authorized third parties to whom disclosure is made to keep
         confidential and not use or disclose, (except in connection with
         evaluating and implementing the Transaction) all confidential
         information obtained from the other as a result

                                                                               4
<PAGE>   24
         of its review and investigation of the other in connection with the
         Transaction.

                                    ARTICLE 6
                            VENUE AND APPLICAPLE LAW

         In as far as parties have a free choice of law the validity
         construction and performance of this agreement will be governed by the
         laws of Iceland and all disputes arising out of or in connection with
         this agreement will be brought before the competent Court in Iceland.

Thus made, in fourfold drawn up and signed in Reykjavik, on 8 November, 2000.

                               For the Purchaser:

                              /s/ Kari Stefansson
                             ---------------------
                                 Kari Stefansson

                                  The Founders:

                              /s/ Einar Stefansson
                             ----------------------
                                Einar Stefansson

                            /s/ Thorsteinn Loftsson
                           -------------------------
                              Thorsteinn Loftsson

LEGALIZATION OF SIGNATURE

Seen for legalization of the signature of Mr. Einar Stefansson, and
Mr. Porsteinn Loftsson residing in Reykjavik, Iceland, by me, Gunnar
Sturluson, Supreme Court Attorney, practising in Reykjavik, Iceland, on this
day, the 8 November 2000.

/s/ Gunnar Sturluson

                                                                               5
<PAGE>   25
                               POWER OF ATTORNEY

I, the undersigned, Kari Stefansson, Id. No. 060449-3849, CEO and the sole
Member of the Board of Directors of Islensk Erfoagreining ehf., and CEO of
deCODE genetics, Inc. hereby grant to Helga Tatjana Zharov, Attorney at Law, Id.
No. 080966-4749, domiciled at Granaskjol 16, 107 Reykjavik, full and unlimited
power of attorney to sign on behalf of the company documents pertaining to the
purchase by the company of a 100% share in the company Cyclops ehf. This power
of attorney also covers the signing of the purchase agreement, conveyance of
title and all other documents relating to the said purchase including the
signing of a confirmation of the issue of shares in deCODE in payment for the
purchase.

     Her signature on these documents shall be the equivalent of my own.

                                                      Reykjavik, 10 October 2000

/s/ Kari Stefansson
----------------------

Witnesses to the correct signature,
date and legal competence:

/s/ Hannes Por Smarason         Id. No.  251167-3389
---------------------------             -------------

/s/ Edward Mcneil Farmer        Id. No.  010568-2349
----------------------------            -------------

Reykjavik 13 March 2001
CERTIFIED TRANSLATION
Jon Skaptason

/s/ Jon Skaptason
<PAGE>   26
                              KACE TRADERS LIMITED

                             MINUTES OF THE MEETING
                           OF THE BOARD OF DIRECTORS
                    HELD ON THE 26TH OCTOBER 2000 AT 9 A.M.
                    AT THE REGISTERED OFFICE OF THE COMPANY
                              IN NICOSIA - CYPRUS

--------------------------------------------------------------------------------

Present:  NAIRY MERHEJE                 -        Director

          BEDROS DER ARAKELIAN          -        Director

          DORINA PAPAKYRIACOU
          for ARAKEL SERVICES LTD       -        Secretary
--------------------------------------------------------------------------------

Mrs. Nairy Merheje acted as the Chairman of the meeting and Mrs. Dorina
Papakyriacou as Secretary thereof. The Chairman ascertained that there was a
quorum in accordance with the Company's Articles of Association, called the
meeting to order and said that the meeting had been called for the purpose of
appointing the below mentioned as representative and lawful Attorney of the
Company.

MR. GUNNAR STURLUSON

ID No. 170767-4119
of Reykjavik, Iceland

After discussion and upon motion duly made, seconded and unanimously carried, it
was resolved as follows:

                                 "RESOLUTIONS

1.    That MR. GUNNAR STURLUSON ID No. 170767-4119 of Reykjavik, Iceland, be and
      is hereby appointed the lawful attorney of the Company in order to act on
      behalf of the Company in any matters to do with the operations of the
      Company anywhere in the world and to sign and/or execute any documents
      whatsoever on behalf of the Company.

2.    That a special Power of Attorney in the terms of the draft presented to
      the meeting and approved, be issued to the above mentioned, such Power of
      Attorney to be executed by a Director and the Secretary of the Company."

There being no further matters for discussion the meeting was adjourned at
10:00 a.m.

/s/ NAIRY MERHEJE                         /s/ DORINA PAPAKYRIACOU
-----------------------                   ----------------------------
NAIRY MERHEJE                             DORINA PAPAKYRIACOU
Chairman/Director                         Secretary
                                          for ARAKEL SERVICES LTD.<PAGE>   1
                                                                   Exhibit 10.54

                             OFFICER'S CERTIFICATE

     I, the undersigned, do hereby certify and represent that:

     1. I am the duly elected Executive VP, Senior Business and Finance Officer
of deCODE genetics, Inc. a Delaware Corporation.

     2. Pursuant to Rule 306(a) of Regulation S-T, the following exhibit 10.54
to deCODE genetics, Inc's Annual Report on Form 10-K is a fair and accurate
English translation of a document prepared in the Icelandic language.

     IN WITNESS WHEREOF, I have signed this Officer's Certificate in my
capacity as Executive VP, Senior Business and Finance Officer of deCODE
genetics, Inc. on this 14 day of March, 2001.

                                       By:    /s/ Hannes P. Smarason
                                              ---------------------------------
                                       Name:  Hannes P. Smarason
                                       Title: Executive VP, Senior Business and
                                              Finance Officer
<PAGE>   2
                                                                   Exhibit 10.54

                            [deCODE genetics - LOGO]

                              EMPLOYMENT AGREEMENT

deCODE genetics Ltd. (Islensk erfoagreining ehf.), State Registration No.
691295-3549, of Lynghals 10, Reykjavik ("the employer"), on the one hand, and

         Einar Stefansson                                 190552-2769
-------------------------------                    ---------------------------
         (employee name)                             (identification number)

whose address is  Fjaroarasi 13, 110 Reykjavik  (" the employee") on the other
                  ----------------------------
hand

enter into the following employment agreement:

      1. FIELD OF WORK.

      The employee is hired to work for the employer as a Vice President of the
      Database Division of IE. In his work he will participate in the management
      of the company and will, as such, [influence] its strategic planning and
      development.

      The workplace is the employer's base of operations at Hlioarsmara 15,
      Kopavogur and/or Lynghals 1, Reykjavik. If the employer's base of
      operations in Reykjavik changes or their number increases, the work place
      of the employee may change accordingly.

      The employee will work under the supervision of the CEO.

      The employer reserves the right to make changes in the employee's projects
      or supervision if the employer deems this necessary.

      2. PERIOD OF EMPLOYMENT

      The employee began work for the employer on  1 September 2000

      Einar Stefansson (ES) and IE agree that IE may not terminate the
      Employment Agreement with ES for two years, counting from the first day of
      employment. At the end of said period the mutual notice period for
      termination shall be 6 months.
<PAGE>   3
      ES, on the other hand, may terminate this agreement with a 6 month notice
      period from the first day of his employment.

      3. JOB OBLIGATIONS AND OTHER JOBS

      The employee pledges to do the work he undertakes with a sense of duty and
      diligence. While working for the employer, the employee may not, unless
      with the employer's written consent, work at other jobs or participate in
      other employment that competes with the employer's operations, or that can
      conflict in some other way with the employee's work for the employer.

      It is agreed that ES shall continue to hold his position as professor at
      the University of Iceland, which is in part sponsored by IE in accordance
      with a special agreement on the said position between the University of
      Iceland and IE which agreement shall form an appendix to this Agreement.

      ES shall also be permitted to continue to work as a physician and on
      genetic research on eye diseases. To begin with ES may spend between half
      to one full day per week for the said work with no reduction of his wages
      from IE. This research relates to patients at the Centre for Eye Diseases
      on Oldugata 17.

      It is agreed that during his term of employment ES will act as a contact
      person between IE and the University of Iceland on behalf of IE.

      ES shall be authorised to hold lectures in his special field in Icelandic
      and foreign institutions and at conferences but shall ensure that the
      timing of such lectures does not interfere with his duties at the company.

      Upon termination of his employment, the employee has a duty to turn over
      all documents and identification papers in his custody that pertain to the
      employer.

      4. WORKING HOURS

      The employee's fixed working hours are from 9 o'clock to 5 o'clock Monday
      through Friday, unless otherwise agreed. The employee shall also work
      other hours, if necessary, depending on to what extent the nature of his
      projects so require, unless urgent circumstances prevent his doing so. The
      days off are the holidays of the National Church, the First Day of Summer,
      1 May, 17 June and the first Monday in August.

      If an urgent necessity comes up, the employer can call the employee to
      work at any time outside normal working hours.

      During the period of employment, the employer and employee can agree on an
      arrangement of working hours other than the one above.

                                       2
<PAGE>   4
      5. WAGES

      The employee's fixed monthly wages are ISK 1,000,000.- . Payment for work
      done outside regular working hours and for any kind of work-related tasks
      is included in the above monthly wages.

      Wages shall be paid monthly on the last working day of each month.

      The wages stated above are complete remuneration for the work done by the
      employee.

      Wages and other wage terms shall be re-examined every year, taking into
      consideration general wage changes and work results.

      The rights of the employee to vacation and maternity leave will be
      according to law.

      In addition to the above fixed wage ES shall be paid a performance-linked
      wage bonus which shall be based on his performance in the job and the
      general performance of the company, according to a decision and strategic
      targets established by the Compensation Committee, which is a committee
      elected by the Board of Directors of deCODE genetics, Inc. The aim is that
      such wage supplement should be 20-40% of the fixed wages based on the
      above criteria.

      When the employee has earned a full right to vacation by working for the
      employer in the last vacation year, upon beginning his vacation or no
      later than 15 August each year, he shall receive a special lump-sum
      payment. This vacation supplement, based on full-time employment in the
      last vacation year, shall be ISK 8,400, or a proportional amount of this
      sum if part-time work or a shorter period of work is involved. Vacation
      pay is not paid for vacation supplements.

      The employee pays 4% of his total wages as a premium into a pension fund
      of his own choice, and the employer pays 6% of the same amount.

      6. INSTANCES OF ACCIDENT AND ILLNESS AND INSURANCE

      When the employee has an accident at work, the employer pays for getting
      the employee home or to hospital and, for each instance, reimburses him
      for up to four weeks of normal, out-of-pocket medical expenses that
      district health insurance or Social Security does not pay.

      In each instance of an accident at work or a work-related illness caused
      on the job or by it, or occurring during transport to and from the
      workplace, the employer pays up to three months' wages according to the
      employee's wage scale in effect when the accident or illness occurs,
      provided that per diem paid for these days by the State Social Security
      Institute and/or the district health insurance is paid to the employer.
      The provisions of this paragraph do not prejudice any additional rights
      the employee may have under the law.

      Wage payments to the employee during absences due to illness shall be
      arranged the first year so that two days are paid for each month worked.
      When the employee has worked for the employer for one year or longer, wage
      payments during absences due to illness shall be arranged as follows:
      After one year, two months for every 12

                                       3
<PAGE>   5
      months. After five years of work for the employer, four months for every
      12 months, and after 10 years working for the employer, six months for
      every 12 months.

      If an employee becomes ill and for this reason cannot go to work, he shall
      immediately notify his superior, who decides whether a health certificate
      shall be provided. The certificate shall be from a consulting physician if
      this is requested. The employer shall pay for the health certificate if
      the above conditions are met.

      After the first month at work a parent shall, without any deduction from
      wages, be entitled to spend a total of seven workdays of every 12-month
      period in ministering to his sick children under the age of 13, provided
      that other care cannot be procured.

      The employer is obligated to insure the employee against death and chronic
      or temporary disability caused be an accident while at work or while
      travelling a normal route between his home and the workplace.

      If, because of his work, the employee has accommodations away from his
      home, the accommodations replace his home, but the insurance also covers
      normal trips between his home and these accommodations.

      Compensation for death will be (as of 1 Jan. 1998):

      1. If the deceased was not married and is not survived by a child and has
         not been supporting an aged parent 67 years of age or older, ISK
         342,100.

      2. If the deceased was not married but is survived by a child (children)
         under 17 and/or has provably supported an aged parent or parents (aged
         67 or older), ISK 1,083,500.

      3. If the deceased was married, the compensation to the spouse is ISK
         1,479,700.

      4. If the deceased is survived by a child (adopted child, foster child)
         under 17 years of age, for each child ISK 284,800.

      5. Compensation is paid under only one of the sub-paragraphs, no. 1, 2
         or 3.

      In addition to sub-paragraphs 2 and 3, compensation can be paid under
      sub-paragraph 4.

      The beneficiaries of death compensation provisions are:

      1) Legal heirs.
      2) Relevant parties equally
      3) Surviving spouse.
      4) Relevant children, but paid to surviving spouse if he/she is one of the
         parents, or to an executor and/or trustee.

      Compensation for chronic disability is paid in proportion to the insurance
      amount of ISK 2,589,000 so that each degree of disability from 26% to 50%
      is counted double, and each degree of disability from 51% to 100% works
      triple.

      For temporary disability, per diem of ISK 5,884 is paid per week four
      weeks after the accident occurred and until the injured person becomes
      able to work, although for no more than 48 weeks. ISK 785 per week are
      added to the per diem for each child under the age of 17 that the injured
      person is supporting.

                                       4
<PAGE>   6
      The amounts of insurance will be reconsidered twice a year, 1 January and
      1 July, and increased in correspondence with changes in the cost-of-living
      index.

      The insurance goes into force as soon as the employee begins work and
      expires as soon as he stops working.

      The policy terms of the insurance shall be the general policy terms in
      force for wage earner job accident insurance at the Association of
      Icelandic Insurance Companies when this employment agreement is signed.

      If the employer becomes liable for damages in respect of the employee,
      accident compensation and per diem paid to the employee under provisions
      of this employment agreement shall be fully deductible from any damages
      that the employer may be made to pay. While the payment of wages
      continues, per diem is paid to the employer.

      7. CONFIDENTIALITY

      The employee fills a job of responsibility and trust for the employer. He
      shall maintain the utmost confidentiality about whatever he has become
      aware of in his job regarding the employer and the employer's customers,
      and which can damage the interests of these parties. Due to the nature of
      his work, the employee is obligated to handle all information, documents
      and data to which he has access in his work with the utmost
      confidentiality. This confidentiality continues in force after termination
      of employment.

      The substance of this employment agreement, as well as any other
      agreements that the employer may enter into with the employee, are
      confidential. Particular emphasis is placed on the employee maintaining
      confidentiality with regard to wages and wage terms.

      While the employee works for the employer and for one (1) year thereafter,
      the employee shall not encourage any of the employer's employees to quit
      working for the employer.

      If the employee quits working for the employer, he obligates himself not
      to accept work either directly or indirectly at competing companies or
      other competing parties, or to start up or join such operations for at
      least two years after termination of employment.

      8. PROPRIETARY INFORMATION AND INVENTIONS

      In parallel with the signing of this employment contract, the employer and
      employee enter into an agreement on proprietary information and
      inventions. That agreement is deemed a premise for and part of this
      employment agreement.

      All previous employment agreements, offers and memos on employment terms
      between the employee and the employer are declared void as of the date of
      effect of this agreement.

                               Reykjavik, 22 November 2000

                                       5
<PAGE>   7
      Employee                               On behalf of DECODE GENETICS, INC.

      /s/ Einar Stefansson                   /s/ Kari Stefansson
      ------------------------               -----------------------

                                       6
<PAGE>   8
APPENDIX I

Agreement between the University of Iceland and deCODE genetics, Inc on the work
undertaken by Professor Einar Stefansson, of 1 November 2000.

                                       7

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