EXHIBIT 10.10
HEMACARE CORPORATION
LOAN REIMBURSEMENT AGREEMENT
This Loan Reimbursement Agreement is made and
entered into by and between HemaCare Corporation, a
California corporation having its principal place of business
at 4954 Van Nuys Boulevard, Sherman Oaks, California 91403
(hereinafter, "HemaCare") and Joshua Levy, M.D., a resident
of Valley Village, California (hereinafter, the "Medical
Director"), effective July 31, 1997.
RECITALS
A. WHEREAS, the Medical Director is currently employed by HemaCare;
B. WHEREAS, Hemabiologics, Inc. ("Hemabiologics"), a
wholly-owned subsidiary of HemaCare, loaned the Medical
Director a total of Ninety-Eight Thousand, Three Hundred and
Seven Dollars ($98,307.00) in 1994 and 1995 (the "Loan"); and
C. WHEREAS, the Medical Director and Hemabiologics desire
to set forth in writing their agreement with respect to the
outstanding loan.
D. WHEREAS, it is agreed that this Loan Reimbursement
Agreement supersedes the terms, conditions, and limitations
of any prior loan notes.
AGREEMENT
NOW, THEREFORE, for and in consideration of the
promises, covenants and agreements herein contained, the
parties agree as follows:
ARTICLE 1
Employment
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1.1 Employment. The Medical Director is currently
an employee of HemaCare.
1.2 Term. This agreement shall be for a five
(5) year term commencing on July 31, 1997, subject to the
provisions of Article 3.
1.3 Supersedes Prior Agreement. This agreement
supersedes the loan agreement dated January 1996 between the
Medical Director and Hemabiologics.
ARTICLE 2
Loan Repayment
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The outstanding balance of the loan, adjusted for
accrued interest, will be reduced each year of the Medical
Director's employment as follows:
August 1
Year Annual Reduction Loan Balance
- -------- ---------------- ------------
1996/97 $92,909
1997/98 $23,689 77,833
1998/99 23,689 61,178
1999/2000 23,689 42,779
2000/01 23,689 24,226
2001/02 23,689 0
Hemabiologics currently holds 40,000 shares of HemaCare stock
as collateral against the loan. If the value of the shares
exceeds the loan balance value on any of the loan reduction
dates above, after loan reduction, Hemabiologics will return
any excess shares to the Medical Director. If the value of
the shares is less than the loan balance value on any of the
loan reduction dates above, no shares will be returned to the
Medical Director.
ARTICLE 3
Termination of Agreement
------------------------
Either the Medical Director or HemaCare may
terminate this Agreement, at any time, without cause, and
without notice.
3.1 Termination by HemaCare Without Cause. In the
event that HemaCare exercises its right to terminate this
Agreement without cause, Hemabiologics shall agree to fully
forgive the then outstanding Loan balance owed by the Medical
Director and return all HemaCare stock held as collateral
against the loan at that date.
3.2 Termination by HemaCare With Cause. In the
event that HemaCare terminates this agreement for cause (as
defined below), the Medical Director will be obligated to
immediately repay the then outstanding Loan balance to
Hemabiologics, and Hemabiologics will return all HemaCare
stock held as collateral against the loan at that date
For purposes of this Agreement, the term "for
cause" shall include, but not be limited to, any of the
following:
a) Any actual conflict of interest or competition
against HemaCare. The willful failure of the Medical
Director to substantially perform his duties as Medical
Director. No act, or failure to act, on the Medical
Director's part shall be considered "willful" unless done, or
omitted to be done, by him not in good faith and without
reasonable belief that his action or omission was in the best
interest of HemaCare;
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b) The Medical Director's conviction of a crime
involving a felony, fraud, embezzlement or the like; or
c) The engaging by the Medical Director in
conduct, or the taking by the Medical Director of any action,
which is materially injurious to HemaCare or any of its
affiliated entities.
3.3 Resignation. In the event that the Medical
Director resigns from his employment, the Medical Director
will be required to immediately reimburse the full amount of
the then outstanding Loan balance to Hemabiologics, and
thereafter, Hemabiologics will return all HemaCare stock held
as collateral against the loan at that date.
3.4 Termination on Disability or Death. This
Agreement will terminate automatically upon the death of the
Medical Director or upon the legal, physical or mental
incapacity of the Medical Director to perform his duties for
any period in excess of six (6) months. If the Medical
Director dies or is mentally and/or physically incapacitated
for a period of more than six (6) months, Hemabiologics will
fully forgive the outstanding Loan balance and return all
HemaCare stock held as collateral against the loan at that
date.
3.5 Loan Balance. For purposes of this agreement,
the outstanding Loan balance shall be determined by
increasing the Loan balance at the July 31st date immediately
preceding the event of employment termination as follows:
Interest will be calculated at an annual interest rate of 10%
(the "Updated Loan"), decreasing the Updated Loan by a pro
rata share of the annual reduction amount. The pro rata
share will be calculated by multiplying the annual reduction
amount of $24,212 by a fraction of the numerator of the
number of days of employment since the August 1st date
immediately preceding the date of employment termination, the
denominator of which is 365. For example, if employment
termination occurred on September 12, 2000, the Loan balance
would be calculated as follows:
Loan Balance at July 31, 2000 $42,779
Interest at 10% from August 1 to September 12, 2000 494
--------
Updated Loan 43,273
Pro Rata Share of Annual Reduction (43/365 x $23,689) (2,790)
--------
Loan Balance $40,483
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ARTICLE 4
Miscellaneous
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4.1 Entire Agreement. This Agreement constitutes
the entire agreement and understanding between the parties
with respect to the subject matter hereof and supersedes any
and all other agreements, communications, understandings,
promises, stipulations, arrangements, whether any of the same
are either oral or in writing, or express or implied, between
the parties hereto with respect to the subject matter hereof
. No change to or modification of this Agreement shall be
valid or binding unless the same shall be in writing and
signed by both the Medical Director and the president of
HemaCare.
4.2 Waivers. A waiver of any provision of this
Agreement shall not be valid unless such waiver is in writing
and signed by the party or person to be charged, and no
waiver of any provision hereof shall be deemed or construed
as a waiver of the same or any different provisions in the
future. Furthermore, the failure of a party to insist upon
strict adherence to any term of this provision of this
Agreement, shall not (a) be a waiver of that term or
provision, (b) estop the party from enforcing that term or
provision, or (c) preclude that party from enforcing that
term or provision by laches. The receipt of a party of any
benefit under this Agreement shall not effect a waiver or
estoppel of the right of that party to enforce any provision
of this Agreement.
4.3 Assignment. This Agreement shall not be
assignable, in whole or in part, by the Medical Director.
HemaCare shall have the right and power to assign this
Agreement, as well as its rights and obligations hereunder,
by advising the Medical Director of such an assignment in
writing.
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4.4 Severability. In the event that any one or
more of the provisions of this Agreement shall be held
invalid, illegal, or unenforceable, in any respect, by a
court of competent jurisdiction, the validity, legality, and
enforceability of the remaining provisions contained herein
shall not in any way be affected thereby.
IN WITNESS WHEREOF, the parties hereto acknowledge
that they have read this Agreement, fully understand it, and
have freely and voluntarily entered into it.
"Medical Director:
Dated: 1/30/98 By: /s/ Joshua Levy
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Joshua Levy, M.D.
HemaCare"
Dated: 1/30/98 By: /s/ Hal I. Lieberman
------------------- --------------------------
Hal Lieberman, President
and Chief Executive Officer
for HemaCare Corporation
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