EMPLOYEE EMPLOYMENT AGREEMENT

Exhibit 10.26

EMPLOYEE EMPLOYMENT AGREEMENT

THIS AGREEMENT is made as of the 1st day of January 2000, between THERAGENICS CORPORATION, a Georgia corporation (the “Company”), and Michael O’Bannon (the “Employee”).

INTRODUCTION

The Company and the Employee desire to enter into an employment agreement embodying the terms and conditions of the Employee’s employment.

NOW, THEREFORE, the parties agree as follows:

1.   Definitions

(a)     “Affiliate” means any person, firm, corporation, partnership, association or entity that, directly or indirectly or through one or more intermediaries, controls, is controlled by or is under common control with the Company.

(b)     “Applicable Period” means the period of the Employee’s employment hereunder and for two (2) years after termination of his employment with the Company.

(c)     “Area” means the United States.

(d)     “Board of Directors” means the Board of Directors of the Company

(e)     “Business of the Company” means any business that involves the manufacture, production, sale, marketing, promotion, exploitation, development and distribution of radiological pharmaceutical products or implantable radiation devices used in the treatment of cancer.

(f)     “Cause” means the occurrence of any of the following events: (i) willful and continued failure (other than such failure resulting from his incapacity during physical or mental illness) by the Employee to substantially perform his duties with the Company or an Affiliate; (ii) conduct by the Employee that amounts to willful misconduct or gross negligence; (iii) any act by the Employee of fraud, misappropriation, dishonesty, embezzlement or similar conduct against the Company or an Affiliate; (iv) commission by the Employee of a felony or any other crime involving dishonesty; (v) the habitual and disabling use by the Employee of alcohol or drug; (vi) failure of any drug screening test required by the Company or an Affiliate; (vii) material violation of any policy of the Company or an Affiliate; or (viii) a material breach of the Agreement by the Employee.

(g) “Change in Control” means

(1)     the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of voting securities of the corporation where such acquisition causes such person to own thirty-five percent (35%) or more of the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this Subsection (1), the following acquisitions shall not be deemed to result in a Change of Control: (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company or (iv) any acquisition by any corporation pursuant to a transaction that complies with clauses (i), (ii) and (iii) of Subsection (3) below; and provided, further, that if any Person’s beneficial ownership of the Outstanding Company Voting Securities reaches or exceeds thirty-five percent (35%) as a result of a transaction described in clause (i) or (ii) above, and such Person subsequently acquires beneficial ownership of additional voting securities of the Company, such subsequent acquisition shall be treated as an acquisition that causes such Person to own thirty-five percent (35%) or more of the Outstanding Company Voting Securities; or

(2)     individuals who as of the date hereof, constitute the Board of Directors (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board of Directors; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board of Directors; or

(3)     the approval by the shareholders of the Company of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (“Business Combination”) or, if consummation of such Business Combination is subject, at the time of such approval by shareholders, to the consent of any government or governmental agency, the obtaining of such consent (either explicitly or implicitly by consummation); excluding, however, such a Business Combination pursuant to which (i) all or substantially all of the individuals and entities who were the beneficial owners of the Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 60% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation that as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the Outstanding Company Voting Securities, (ii) no Person (excluding any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, thirty-five percent (35%) or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (iii) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or

(4)     approval by the shareholders of the Company of a complete liquidation or dissolution of the Company.

Notwithstanding the foregoing, no Change of Control shall be deemed to have occurred for purposes of this Agreement by reason of any actions or events in which the Employee participates in a capacity other than in his capacity as Employee.

(h)     “Company Invention” means any Invention which is conceived by the Employee alone or in a joint effort with others during the period of the Employee’s employment hereunder which (i) may be reasonably expected to be used in a product of the Company, or a product similar to a Company product, (ii) results from work that the Employee has been assigned as part of his duties as an employee of the Company, (iii) is in an area of technology which is the same or substantially related to the areas of technology with which the Employee is involved in the performance of his duties as an employee of the Company, or (iv) is useful, or which the Employee reasonably expects may be useful, in any manufacturing or product design process of the Company.

(i)     “Competing Business” means any person, firm, corporation, joint venture or other business entity which is engaged in the Business of the Company (or any aspect thereof) within the Area.

(j)     “Confidential Information” means data and information relating to the business of the Company (which does not rise to the status of a Trade Secret) which is or has been disclosed to the Employee or of which the Employee became aware as a consequence of or through its relationship to the Company and which has value to the Company and is not generally known to its competitors. Confidential Information shall not include any data or information that has been voluntarily disclosed to the public by the Company (except where such public disclosure has been made by the Employee without authorization) or that has been independently developed and disclosed by others, or that otherwise enters the public domain through lawful means. The provisions in this Agreement restricting the use of Confidential Information shall survive for a period of two (2) years following termination of this Agreement.

(k)     “Disability” means the inability of the Employee to perform any of his duties hereunder due to a physical, mental, or emotional impairment, as determined by an independent qualified physician (who may be engaged by the Company), for a ninety (90) consecutive day period or for an aggregate of one hundred eighty (180) days during any three hundred sixty-five (365) day period.

(l)     “Good Reason” means the occurrence of any of the following events which is not corrected by the Company within thirty (30) days after the Employee’s written notice to the Company of the same: (i) the nature of the Employee’s duties or the scope of his responsibilities are materially modified without the Employee’s written consent, (ii) the Employee is required to report to a different position without the Employee’s written consent, (iii) the Company changes the location of the Employee’s place of employment to more than fifty (50) miles from its present location, or (iv) a material breach of this Agreement by the Company.

(m)     “Invention” means any discovery, whether or not patentable, including, but not limited to, any useful process, method, formula, technique, machine, manufacture, composition of matter, algorithm or computer program, as well as improvements thereto, which is new or which the Employee has a reasonable basis to believe may be new.

(n)     “Public Offering” means the offering or sale by the Company of equity securities pursuant to a registration statement filed in accordance with the Securities Act of 1933, as amended, or any comparable law then in effect, and the effective date of any such Public Offering shall be the first day on which the securities covered thereby may lawfully be offered and sold pursuant to such registration statement.

(o)     “Termination Date” means the date which corresponds to the first to occur of (i) the death or Disability of the Employee, (ii) the last day of the Term as provided in Section 4(a) below or (iii) the date set forth in a notice given pursuant to Section 4(b) below.

(p)     “Trade Secrets” means information including, but not limited to, technical or nontechnical data, formulas, patterns, compilations, programs, devices, methods, techniques, drawings, processes, financial data, financial plans, product plans or lists of actual or potential customers or suppliers which (i) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. The provisions in this Agreement restricting the use of Trade Secrets shall survive termination of this Agreement for so long as is permitted by the Georgia Trade Secrets Act of 1990, O.C.G.A. §§ 10-1-760-10-1-767.

(q)     “Work” means a copyrightable work of authorship, including without limitation, any technical descriptions for products, user’s guides, illustrations, advertising materials, computer programs (including the contents of read only memories) and any contribution to such materials.

2.     Terms and Conditions of Employment.

(a)     Employment. The Company hereby employs the Employee as its Executive Vice President of Organizational Development and the Employee accepts such employment with the Company in such capacity. The Employee shall report to the Chief Executive Officer and shall have such authority and responsibilities and perform such duties as shall reasonably be assigned to the Employee from time to time by the Chief Executive Officer of the Company.

(b)     Exclusivity. Throughout the Employee’s employment hereunder, the Employee shall devote substantially all the Employee’s time, energy and skill during regular business hours to the performance of the duties of the Employee’s employment (vacations and reasonable absences due to illness excepted), shall faithfully and industriously perform such duties, and shall diligently follow and implement all management policies and decisions of the Company.

3.     Compensation.

(a)     Base Salary. In consideration for the Employee’s services hereunder, the Company shall pay to the Employee an annual base salary in the amount of $130,000 initially. The Employee’s annual base salary shall be reviewed at least annually by the Company, and the Company may increase the Employee’s annual base salary from time to time. The Company shall pay annual base salary in accordance with the normal payroll payment practices of the Company and subject to such deductions and withholdings as law or policies of the Company, from time to time in effect, require.

(b)     Bonus. In addition to the annual base salary payable under Section 3(a) hereof, the Employee shall be entitled to discretionary annual bonuses. The maximum annual bonus shall be equal to 20% of the Employee’s annual base salary. The actual amount of bonus paid annually will be determined by the Chief Executive Officer based upon the Chief Executive Officer’s evaluation of the Employee’s performance. However, in the event that the Company adopts a bonus program that applies to a category of employees which includes Employee, such program will apply for the Employee, in lieu of, and notwithstanding the provisions of this Subsection (b).

(c)     Stock Based Compensation. Stock options or other stock-based compensation will be awarded to the Employee at the discretion of the Board of Directors, or a committee thereof, and pursuant to the Company’s stock incentive plan.

(d)     Vacation. The Employee shall be entitled to four weeks of vacation per year, to be taken at times mutually convenient to the Company and the Employee.

(e)     Licenses. The Company will reimburse the Employee for the costs associated with keeping in full force the professional licenses he possessed prior to this contract including two (2) trips per year to attend professional meetings necessary for maintaining licenses and credentials.

(f)     Financial, Tax and Estate Planning. The Company will reimburse the Employee for the cost of personal financial, tax, and estate planning and services in an amount not to exceed $4,000 per year from the date hereof.

(g)     Annual Physical. The Company will pay the expenses associated with an annual physical examination for the Employee.

(h)     Life Insurance. During the term of this Agreement, the Company will provide the Employee with term life insurance coverage in accordance with its group term life insurance program. Subject to the availability of supplemental coverage under the terms of the Company’s program, the Company will reimburse the Employee for his cost of premiums under its group term life insurance program for additional optional coverage up to the lesser of an additional $200,000 death benefit or an aggregate death benefit up to $450,000.

(i)     Expenses. The Employee shall be entitled to be reimbursed in accordance with the policies of the Company, as adopted and amended from time to time, for all reasonable and necessary expenses incurred by the Employee in connection with the performance of the Employee’s duties of employment hereunder; provided, however, the Employee shall, as a condition of such reimbursement, submit verification of the nature and amount of such expenses in accordance with the reimbursement policies from time to time adopted by the Company.

(j)     Benefits. In addition to the benefits payable to the Employee specifically described herein, the Employee shall be entitled to such benefits as generally may be made available to employees of the Company from time to time; provided, however, that nothing contained herein shall require the establishment or continuation of any particular plan or program.

4.     Term, Termination and Termination Payments