Document:

Exhibit 10.6

 

FOURTH
ACKNOWLEDGEMENT AND AMENDMENT AGREEMENT

 

This Fourth Acknowledgement and Amendment
Agreement (the “Acknowledgement”) is dated December 23, 2008, and
is entered into by and between Richard J. Faleschini (the “Employee”),
and BioSphere Medical, Inc., a Delaware corporation (the “Company”).

 

WHEREAS, the Employee and the Company have
entered into (i) a certain Employment Agreement dated November 2,
2004, as amended by an Acknowledgement and Amendment Agreement dated March 16,
2007, a Second Acknowledgement and Amendment Agreement dated April 5,
2007, and a Third Acknowledgement and Amendment Agreement dated October 10,
2007, regarding the Employee’s employment with the Company (the “Employment
Agreement”) and (ii) a certain Executive Retention Agreement made
effective as of November 2, 2004 (the “Retention Agreement”);

 

WHEREAS, the parties desire to modify the
provisions of the Employment Agreement and the Retention Agreement as set forth
herein.

 

NOW, THEREFORE, in consideration of the mutual
covenants contained herein and for other good and valuable consideration, the
sufficiency of which is hereby acknowledged, the undersigned hereby agree as
follows:

 

1.                                       The Employment Agreement is
hereby amended as follows:

 

(a)                                  Section 4.3 is deleted
in its entirety and a new Section 4.3 is inserted in lieu thereof which
reads as follows:

 

“4.3.  At the election of the Employee for Good
Reason (as defined below), immediately upon written notice by the Employee to
the Company, which notice shall identify the Good Reason upon which the
termination is based.  For the purpose of
this Section 4.3, “Good Reason” for termination shall mean (i) a
material adverse change in Employee’s authority, duties or compensation without
the prior consent of the Employee, or (ii) the commission by the Company
of a material breach of this Agreement. 
Notwithstanding the occurrence of any such event or circumstance, such
occurrence shall not be deemed to constitute Good Reason unless (x) the
Employee gives the Company the notice of termination no more than 90 days after
the initial existence of such event or circumstance, (y) such event or
circumstance has not been fully corrected and the Employee has not been
reasonably compensated for any losses or damages resulting therefrom within 30
days of the Company’s receipt of such notice and (z) the Employee’s
termination of employment occurs within 2 years following the Company’s receipt
of such notice.

 

(b)                                 Section 5.1(b) is
deleted in its entirety and a new Section 5.1(b) is inserted in lieu
thereof which reads as follows:

 

 

“(b)                           In the event
the Employee’s employment is terminated pursuant to Section 4.1 because
the Company has elected not to renew the Agreement, or is terminated by the
Employee pursuant to Section 4.3 or by the Company pursuant to Section 4.5,
the Company shall continue to pay to the Employee his salary as in effect on
the date of termination and the amount of the annual bonus paid to him for the
fiscal year immediately preceding the date of termination (payable in
annualized monthly installments) and continue to provide to the Employee the
other benefits owed to him under Section 3.2 (to the extent such benefits
can be provided to non-employees, or to the extent such benefits cannot be
provided to non-employees, then the cash equivalent thereof) for a period of 12
months, provided, however, that the Company’s obligation to make the aforesaid
payments or provide the aforesaid benefits shall immediately terminate in the
event that the Employee violates the provisions of Section 6.1 or Section 7
during such 12 month period. 
Notwithstanding the foregoing, to the extent such payments are
reimbursement to the Employee of medical expenses incurred by the Employee as
described in Reg. § 1.409A-1(b)(9)(v)(B), reimbursements may not be made beyond
the period of time during which the Employee would be entitled (or would, but
for such arrangement, be entitled) to COBRA continuation coverage under a group
health plan of the Company.  The payment
to the Employee of the amounts payable under this Section 5.1(b) (i) shall
be contingent upon the execution and non-revocation by the Employee of a
release in a form reasonably acceptable to the Company within 30 days of the
date of termination and (ii) shall constitute the sole remedy of the
Employee in the event of a termination of the Employee’s employment in the
circumstances set forth in this Section 5.1(b).  The payments and benefits shall
commence 60 days following the date of termination, provided that the
release has been properly executed and not revoked as of such date, or, if the
release has been executed and any applicable revocation period has expired
prior to the 60th day following the date of termination, then
the payments and benefits may commence prior to the 60th day but no sooner than the 30th day following the date of termination. 
Notwithstanding the foregoing, if the 60th day following
the date of termination occurs in the calendar year following the termination,
then the payments shall commence no earlier than January 1 of such
subsequent calendar year.

 

Payments to the Employee
under this Section 5.1(b) shall be bifurcated into two portions,
consisting of a portion that does not constitute “nonqualified deferred
compensation” within the meaning of Section 409A of the Internal Revenue
Code of 1986, as amended (the “Code”) and a portion that does constitute
nonqualified deferred compensation. 
Payments hereunder shall first be made from the portion that does not
consist of nonqualified deferred compensation until it is exhausted and then
shall be made from the portion that does constitute nonqualified deferred
compensation.  Notwithstanding the
foregoing, because the Employee is a “specified employee” as defined in Section 409A(a)(3)(B)(i) of
the Code, the commencement of the delivery of any such payments that constitute
nonqualified deferred compensation will be delayed to the date that is 6 months
and one day after the Employee’s termination of employment (the “Earliest
Payment Date”) unless payable upon the Employee’s death.  Any payments that are delayed pursuant to the
preceding sentence shall be paid on the Earliest Payment Date.  The determination of whether, and the extent
to which, any of the payments to be made to the Employee hereunder are
nonqualified deferred compensation shall be made after the application of all
applicable exclusions under Treasury Reg. § 1.409A-1(b)(9).  

 

2

 

Any payments that are intended to qualify for
the exclusion for separation pay due to involuntary separation from service set
forth in Reg. § 1.409A-1(b)(9)(iii) must be paid no later than the last
day of the second taxable year of the Employee following the taxable year of
the Employee in which the Employee’s termination of employment occurs.”

 

(c)                                  Section 9.10 is hereby
deleted in its entirety and replaced with the following new Section 9.10:

 

“9.10                     Section 409A.  Notwithstanding anything else to the contrary
in this agreement, to the extent that any of the payments that may be made hereunder
constitute “nonqualified deferred compensation”, within the meaning of Section 409A
and the Employee is a “specified employee” upon his separation (as defined
under Section 409A), the timing of any such payment following the
separation date shall be modified if, absent such modification, such payment
would otherwise be subject to penalty under Section 409A.  In any event, the Company makes no
representation or warranty and shall have no liability to the Employee or to
any other person if any provisions of this agreement are determined to
constitute “nonqualified deferred compensation” subject to Section 409A
but do not satisfy the requirements of that section.

 

It is intended that each
installment of the severance payments and benefits provided hereunder shall be
treated as a separate “payment” for purposes of Section 409A.  Neither the Company nor the Employee shall
have the right to accelerate or defer the delivery of any such payments or
benefits except to the extent specifically permitted or required by Section 409A.”

 

2.                                       The Retention Agreement is
hereby amended as follows:

 

(a)                                  Section 7.10 is hereby
deleted in its entirety and replaced with the following new Section 7.10:

 

“7.10                     Section 409A.  Notwithstanding anything else to the contrary
in this agreement, to the extent that any of the payments that may be made
hereunder constitute “nonqualified deferred compensation”, within the meaning
of Section 409A and the Executive is a “specified employee” upon his
separation (as defined under Section 409A), the timing of any such payment
following the separation date shall be modified if, absent such modification,
such payment would otherwise be subject to penalty under Section 409A.  In any event, the Company makes no
representation or warranty and shall have no liability to the Executive or to
any other person if any provisions of this agreement are determined to
constitute “nonqualified deferred compensation” subject to Section 409A
but do not satisfy the requirements of that section.

 

It is intended that each
installment of the severance payments and benefits provided hereunder shall be
treated as a separate “payment” for purposes of Section 409A.  Neither the Company nor the Employee shall
have the right to accelerate or defer the delivery of any such payments or
benefits except to the extent specifically permitted or required by Section 409A.”

 

3

 

3.                                       The parties acknowledge and
agree that all other provisions of the Employment Agreement and Retention
Agreement shall remain in full force and effect.

 

4.                                       This Acknowledgement shall
be governed by and construed and interpreted in accordance with the substantive
laws of the Commonwealth of Massachusetts without regard to its principles of
conflicts of law.

 

5.                                       This Acknowledgement may be
executed in any number of counterparts, and each such counterpart shall be
deemed to be an original instrument, but all such counterparts together shall
constitute but one agreement.

 

 

[Remainder of Page Intentionally
Left Blank]

 

4

 

IN WITNESS WHEREOF, the Parties have executed
this Fourth Acknowledgement and Amendment Agreement as of the date first above
written.

 

	
   

  	
  BIOSPHERE MEDICAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Martin J. Joyce

  
	
   

  	
  Title:

  	
  Martin J. Joyce

  
	
   

  	
   

  	
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Richard J. Faleschini

  
	
   

  	
  Name:

  	
  Richard J. Faleschini

  
	
   

  	
  Title:

  	
  President and Chief Executive Officer

  
				

 

5Exhibit 4.1

 

	
  

  	
   

  	
  

  	
   

  	
  

  
	
  VIST FINANCIAL CORP.

  
	
  INCORPORATED UNDER THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SERIES A PREFERRED STOCK

  	
   

  	
   

  	
   

  	
  SERIES A PREFERRED STOCK

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  THIS CERTIFIES that

  	
   

  	
   

  	
   

  	
  SEE REVERSE FOR

  CERTAIN DEFINITIONS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  is the owner of

  	
   

  	
   

  	
   

  	
   

  

 

FULLY PAID AND NON-ASSESSABLE SHARES OF FIXED RATE CUMULATIVE PERPETUAL
PREFERRED STOCK, SERIES A, $.01 PAR VALUE, PER SHARE OF

 

VIST FINANCIAL CORP.

 

transferable
on the books of the Company by the holder hereof in person or by duly
authorized attorney upon surrender of this certificate properly endorsed.

 

This certificate is not
valid until countersigned and registered by the Transfer Agent and Registrar.

 

Witness the facsimile seal
of the Company and the facsimile signatures of its duly authorized officers.

 

CERTIFICATE
OF STOCK

 

	
  Dated:

  	
   

  	
  

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  

  	
   

  	
   

  	
  

  
	
  SECRETARY

  	
   

  	
   

  	
  PRESIDENT AND
  CHIEF EXECUTIVE OFFICER

  

 

COUNTERSIGNED AND REGISTERED:

AMERICAN
STOCK TRANSFER & TRUST COMPANY, LLC

(NEW
YORK, NY)

TRANSFER
AGENT

AND
REGISTRAR

BY

AUTHORIZED
SIGNATURE

 

	
  AMERICAN
  BANK NOTE COMPANY

  	
   

  	
  PRODUCTION
  COORDINATOR: DENISE LITTLE 931-490-1706

  
	
  711 ARMSTRONG LANE

  	
   

  	
  PROOF
  OF DECEMBER 10, 2008

  
	
  COLUMBIA, TENNESSEE 38401

  	
   

  	
  VIST FINANCIAL CORP.

  
	
  (931) 388-3003

  	
   

  	
  TSB 31623 FC

  
	
  SALES:
     C. SHARKEY 302-731-7088

  	
   

  	
  Operator:
  BA

  
	
  /
  ETHER 7 / LIVE JOBS / V / 31623 VIST FC

  	
   

  	
  NEW

  

 

PLEASE INITIAL THE APPROPRIATE SELECTION FOR THIS PROOF:
     OK AS IS      OK WITH
CHANGES      MAKE CHANGES AND SEND ANOTHER PROOF

 

Colors
Selected for Printing: Logo prints Black. Intaglio prints in SC-13 Red.

 

COLOR: This
proof was printed from a digital file or artwork on a graphics quality, color
laser printer. It is a good representation of the color as it will appear on
the final product. However, it is not an exact color rendition, and the final
printed product may appear slightly different from the proof due to the
difference between the dyes and printing ink.

 

©  SECURITY-COLUMBIAN    UNITED
STATES BANKNOTE COMPANY    1960

 

 

VIST FINANCIAL CORP.

 

THE
SECURITIES REPRESENTED BY THIS INSTRUMENT ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR
OTHER OBLIGATIONS OF A BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.

 

THE
SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES
LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED
OF EXCEPT WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER
SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER SUCH ACT OR SUCH LAWS. EACH PURCHASER OF THE SECURITIES
REPRESENTED BY THIS INSTRUMENT IS NOTIFIED THAT THE SELLER MAY BE RELYING
ON THE EXEMPTION FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A THEREUNDER. ANY TRANSFEREE OF THE SECURITIES REPRESENTED BY THIS
INSTRUMENT BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT IT IS A “QUALIFIED
INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES
THAT IT WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED
BY THIS INSTRUMENT EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT WHICH
IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS THE
SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL
BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO
THE ISSUER OR (D) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT
WILL GIVE EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY THIS INSTRUMENTARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

The following abbreviations,
when used in the inscription on the face of this certificate, shall be
construed as though they were written out in full according to applicable laws
or regulations:

 

	
  TEN COM

  	
  –
  

  	
   as tenants in common

  	
   

  	
  UNIF
  GIFT MIN ACT– 

  	
                 Custodian               

  
	
  TEN ENT

  	
  –
  

  	
   as tenants by the
  entireties

  	
   

  	
   

  	
     (Cust)                    (Minor)

  
	
  JT TEN

  	
  –
  

  	
   as joint tenants with
  right of

  	
   

  	
   

  	
  under Uniform Gifts to
  Minors

  
	
   

  	
   

  	
   survivorship and not
  as tenants 

  	
   

  	
   

  	
  Act

  
	
   

  	
   

  	
   in common

  	
   

  	
   

  	
                      (State)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  UNIF
  TRANS MIN ACT– 

  	
                 Custodian               

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
     (Cust)                    (Minor)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  under Uniform Transfers to
  Minors

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Act

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
                      (State)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Additional
  abbreviations may also be used though not in the above list.

  

 

For value received,                             hereby sell, assign and transfer unto

 

	
  PLEASE
  INSERT SOCIAL SECURITY OR OTHER

  	
   

  
	
  IDENTIFYING NUMBER OF ASSIGNEE

  	
   

  
	
   

  	
   

  
	
  (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  shares

  
	
  of
  the preferred stock represented by the within Certificate, and do hereby
  irrevocably constitute and appoint

  
	
   

  
	
   

  	
  Attorney

  
	
  to
  transfer the said stock on the books of the within named Company with full
  power of substitution in the premises.

  
	
   

  
	
  Dated

  	
   

  	
   

  
					

 

	
   

  	
   

  
	
  NOTICE: 

  	
  THE SIGNATURE TO THIS
  ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE
  IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE
  WHATEVER.

  
	
   

  	
   

  
	
   

  	
   

  
	
  SIGNATURE(S) GUARANTEED: 

  	
   

  
	
   

  	
  THE
  SIGNATURE(S) SHOULD BE GUARANTEED BYAN ELIGIBLE GUARANTOR INSTITUTION
  (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH
  MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO
  S.E.C. RULE 17Ad-15.

  

 

	
  AMERICAN
  BANK NOTE COMPANY

  711 ARMSTRONG LANE

  COLUMBIA, TENNESSEE 38401

  (931) 388-3003

  	
   

  	
  PRODUCTION COORDINATOR:
  DENISE LITTLE 931-490-1706

  PROOF OF DECEMBER 15,
  2008
 VIST
  FINANCIAL CORP.

  TSB 31623 BK

  
	
  SALES:  C. SHARKEY
  302-731-7088

  	
   

  	
  Operator:
  BA/AP

  
	
  /
  ETHER 7 / LIVE JOBS / V / 31623 VIST BK

  	
   

  	
  REV. 1

  

 

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