8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported): May 12, 2005 (May 6, 2005)

THERAGENICS CORPORATION^®

(Exact name of Registrant as specified in its charter)

Delaware	000-15443	58-1528626
(State of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

5203 Bristol Industrial Way

Buford, Georgia 30518

(Address of principal executive offices / Zip Code)

(770) 271-0233

(Company’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Company under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act.

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act.

o Pre-commencement communications pursuant to Rule 14d—2(b) under the Exchange Act.

o Pre-commencement communications pursuant to Rule 13e—4(c) under the Exchange Act.

ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

Agreements Entered into in Connection with CP Medical Acquisition

On May 6, 2005, as a result of the acquisition of CP Medical Corporation, an Oregon corporation (“CP Medical”) by Theragenics Corporation^®, a Delaware corporation (the “Company”), described in Item 2.01 below, CP Medical became a wholly-owned subsidiary of the Company. In connection with the acquisition, CP Medical entered into an employment agreement (the “Employment Agreement”) with Patrick J. Ferguson (the “Employee”). Mr. Ferguson may be deemed to be an executive officer of the Company by virtue of his role as President of CP Medical. The execution of the Employment Agreement was contingent upon consummation of the acquisition of CP Medical by the Company pursuant to the Stock Purchase Agreement dated as of April 26, 2005 by and among the Company, Patrick J. Ferguson, Cynthia L. Ferguson and CP Medical (the “Stock Purchase Agreement”).

The Employment Agreement provides for the Employee to continue to serve as President of CP Medical until May 6, 2008, with automatic extensions for successive additional one-year terms unless either party gives prior notice of termination ninety (90) days before the anniversary of the execution date. The Employee’s base salary is set at $200,000 per year (the “Base Salary”) and the Employee became eligible to participate in the Company’s short-term and long-term incentive compensation programs. The Employment Agreement also contains customary non-competition, non-solicitation and confidentiality provisions.

The Employment Agreement may be immediately terminated upon the occurrence of any of the following events (capitalized terms as defined in the Employment Agreement):

·   CP Medical and the Employee reach a mutual agreement in writing as to termination;

·   by the Employee with Good Reason;

·   by the Employee without Good Reason upon not less than thirty (30) days prior written notice to CP Medical;

·   by CP Medical without Cause;

·   by CP Medical for Cause; and

·   by CP Medical or the Employee due to the Disability of the Employee.

If the Employee is terminated for Cause, the Employee will not be entitled to any compensation or other benefits of employment from and after the effective date of the termination. If termination is by CP Medical without Cause or by the employee for Good Reason, he will be entitled to salary continuation for two (2) years; provided, however, if such termination is within ninety (90) days preceding or within one year following a Change in Control (as defined in the Employment Agreement), the Employee will be entitled to salary continuation for two (2) years (or if less, the maximum amount that can be paid without causing a parachute payment under the Internal Revenue Code).

The above description of the Employment Agreement is a summary of the material terms of the Employment Agreement and does not purport to be complete. The description is qualified in its entirety by reference to the full text of the Employment Agreement, which is attached as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.

2

The Compensation Committee of the Board of Directors of the Company recommended, and the Board of Directors approved, the Incentive Compensation for the Employee, as set forth below.

Short-Term Incentive Compensation Award for 2005:

The Employee will have a cash bonus opportunity based on both financial and individual performance in 2005. His targeted short-term incentive opportunity is 35% of his base salary actually paid in 2005 after the closing date of the purchase of CP Medical by the Company, with a minimum opportunity of 0% and a maximum opportunity of 70% of base salary actually paid in 2005. Sixty percent (60%) of the target bonus opportunity is tied to CP Medical performance against target revenue and net profit before tax of CP Medical. Forty percent (40%) of the target bonus opportunity is tied to the Employee’s individual performance objectives and achievement of strategic objectives established for CP Medical, which have been determined by the Chief Executive Officer of the Company, and reviewed by the Compensation Committee and the Board of Directors.

Long-Term Incentive Compensation Award for 2005:

The Compensation Committee of the Board of Directors of the Company recommended, and the Board of Directors approved, an award of 5,000 performance restricted stock rights to the Employee. The number of shares of common stock actually issued to the Employee will be determined based on the Company’s common stock price appreciation plus dividends paid (total stockholder return) relative to an industry peer group (as determined by the Board of Directors) over a performance cycle beginning January 1, 2004 and ending December 31, 2006:

Theragenics Total Stockholder Return Peer Percentile Ranking	Number of Shares of Common Stock to be Issued for Each Performance Right
> 85th   ≥ 75th to < 85th   ≥ 50th to < 75th   < 30th to < 50th	2.0   1.5*   1.0*   0.30*

* The Employee will receive a number of shares as shown in the chart above plus a number of shares of common stock for each performance restricted stock right determined by interpolation for the total stockholder return peer percentile ranking that falls between 30^th and 50^th, 50^th and 75^th, or 75^th and 85^th.

3

If the Employee ceases to perform services as an employee of the Company or an affiliate of the Company before December 31, 2006 due to death, Disability (as defined in the Employment Agreement), retirement upon or after reaching age 65, or termination of employment by the Company or an affiliate of the Company without “Cause” (as defined in the Employment Agreement), the Employee would be entitled to a prorated portion of the shares of common stock determined pursuant to the preceding schedule. If the Employee’s employment is terminated for any other reason before December 31, 2006, the performance restricted stock rights will be forfeited. If a Change in Control occurs before December 31, 2006, one share of common stock will be issuable as of the date of a Change of Control for each performance restricted stock right if the Employee is still employed by the Company or an affiliate of the Company on the date of the Change in Control and the performance restricted stock rights will terminate.

Registration Rights Agreement

The Company also entered into a registration rights agreement dated as of May 6, 2005 (the “Registration Rights Agreement”) with the sellers of CP Medical (the “Sellers”) for the purpose of registering the shares of the Company’s common stock issued to the Sellers. Pursuant to the terms of the Registration Rights Agreement, the Company has agreed to file a Registration Statement on Form S-3 with the Securities and Exchange Commission no later than August 15, 2005 registering the resale of the shares issued to the Sellers, and to keep such Registration Statement effective for a period equal to (i) five years from the initial date that the Securities and Exchange Commission declares such Registration Statement effective, or (ii) such shorter period which shall terminate when all of the registrable securities have been sold or are eligible for resale without restriction under Rule 144 of the Securities Act of 1933, as amended. The Company has agreed to pay all expenses associated with the registration of the Company’s common stock owned by the Sellers, except for the filing fees which are the responsibility of the Sellers. Sales of substantial additional amounts of the Company’s common stock in the public market, or the perception that such sales may occur, could adversely affect the prevailing market of the Company’s common stock.

The above description of the Registration Rights Agreement is a summary of the material terms of the Registration Rights Agreement and does not purport to be complete. The description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is attached as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated herein by reference.

Director Compensation

On May 10, 2005, the Compensation Committee of the Board of Directors of the Company recommended, and the Board of Directors approved, changing the form of the equity component of Director compensation to shares of restricted stock rather than restricted stock rights. The number of shares subject to the annual award was not changed. In lieu of the restricted stock units for non-officer Directors as approved by the Board of Directors in its meeting of February 8, 2005, each non-officer Director shall receive an annual restricted stock grant as of the effective date of the annual meeting of the Company, for the lesser of 5,000 shares of common stock of the Company or a number of shares of the Company’s common stock calculated by dividing $50,000 by the closing trading price of one share of Company common stock on the last business day preceding the date of the annual meeting, subject to three year ratable vesting (one-third per year of service from the date of grant).  Vesting is accelerated upon the death of the Director, disability of the Director, change in control of the Company, or subject to the Board of Directors’ discretion at the time of the event, the resignation of the Director with the consent of the Board of Directors.

4

The Compensation Committee also recommended, and the Board of Directors approved, the form of restricted stock agreement for director awards (“Restricted Stock Agreement”). The above description of the Restricted Stock Agreement is a summary of the material terms and does not purport to be a complete description of all terms.

ITEM 2.01. Completion of Acquisition or Disposition of Assets.

On May 6, 2005, the Company purchased all of the issued and outstanding shares of capital stock of CP Medical from Patrick J. Ferguson and Cynthia L. Ferguson (the “Acquisition”), pursuant to the terms and conditions of the Stock Purchase Agreement, dated as of April 26, 2005, under which the Company paid $19,032,353 in cash at closing and issued 1,885,370 shares of the Company’s common stock, which shares were valued at approximately $6,250,000 based on the average trading price over a 20-day period from March 28, 2005 through April 22, 2005.

At the closing, 904,977 shares of the Company’s common stock issued to the Sellers were placed in escrow for the purpose of compensating the Company in the event the Sellers must indemnify the Company pursuant to the terms of the Stock Purchase Agreement. In addition, the Company has agreed to make additional payments in cash to the Sellers in the event that some portion of the gain from the sale is taxable at ordinary income (instead of capital gain) tax rates. The stock portion of the purchase price is subject to adjustment based on the difference between the working capital of CP Medical on the closing and CP Medical’s working capital as of December 31, 2004. The Company estimates the final purchase price to be approximately $25,400,000.

CP Medical will maintain its operational headquarters at 803 NE 25^th Avenue, Portland OR 97232 and will operate as a wholly-owned subsidiary of the Company, and the Company will continue to be based in Buford, Georgia. Patrick J. Ferguson will continue to serve as President of CP Medical.

ITEM 9.01.  Financial Statements and Exhibits.

(a) Financial statements of business acquired.

Not required pursuant to Rule 3-05 of Regulation S-X (17 CFR 210.3-05).

(b) Pro forma financial information.

Not required pursuant to Article 11 of Regulation S-X (17 CFR 210).

(c) Exhibits

5

Exhibit No.	Document
10.1	Employment Agreement between CP Medical Corporation and Patrick J. Ferguson, dated as of May 6, 2005.
10.2	Registration Rights Agreement by and amongTheragenics Corporation®, Patrick J. Ferguson and Cynthia L. Ferguson, dated as of May 6, 2005.

6

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	THERAGENICS CORPORATION® (Registrant)
Dated: May 12, 2005	By:	/s/  M. Christine Jacobs
		M. Christine Jacobs Chief Executive Officer

7

EX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is dated as of May 6, 2005 between CP Medical Corporation, an Oregon corporation (the “Company”) and Patrick J. Ferguson (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, effective as of, and contingent upon, the closing of the purchase and sale transactions contemplated by the Stock Purchase Agreement dated as of April 26, 2005, with respect to the Company by and among Theragenics Corporation and Patrick J. Ferguson and Cynthia L. Ferguson (the “Closing”).

NOW, THEREFORE, the parties agree as follows, effective as of, and contingent upon, the Closing:

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. For these purposes, “control” shall mean the direct or direct ownership of equity securities of the applicable entity possessing the right to more than fifty percent (50%) of the combined ordinary voting power of the outstanding voting equity securities of such entity.

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

(c) “Area” means the United States.

(d) “Board of Directors” means the Board of Directors of Theragenics Corporation.

(e) “Business of the Company” means any business that involves the manufacture, production, sale, marketing, promotion, exploitation, development and distribution of wound closure medical devices (including but not limited to sutures, cassettes, and glues), cardiac pacing cables, brachytherapy needles, brachytherapy seed spacers, brachytherapy sleeves, palladium-103, temporary or permanently implantable devices for use in the treatment of cancer, restenosis or macular degeneration, or other medical products manufactured or sold by the Company or any of its subsidiaries, in each case that is the same as or similar to a product manufactured, produced, sold, marketed, promoted, exploited, developed or distributed by the Company or any of its subsidiaries at any time during the period of the Employee’s employment under this Agreement, or is in an active state of development by the Company or any of its subsidiaries as evidenced by establishment of a design history file at any time during the period of the Employee’s employment under this Agreement.

(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) illegal use by the Employee of alcohol or drugs; or (vi) 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 Theragenics 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 Theragenics Corporation entitled to vote generally in the election of directors (the “Outstanding 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 Theragenics Corporation, (ii) any acquisition by Theragenics Corporation, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by Theragenics Corporation or any corporation controlled by Theragenics Corporation 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 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 Theragenics Corporation, such subsequent acquisition shall be treated as an acquisition that causes such Person to own thirty-five percent (35%) or more of the Outstanding 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 shareholders of Theragenics Corporation, 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

-2-

(3) the approval by the shareholders of Theragenics Corporation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of Theragenics Corporation (“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 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 Theragenics Corporation or all or substantially all of Theragenics Corporation’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 Voting Securities, (ii) no Person (excluding any employee benefit plan (or related trust) of Theragenics Corporation 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 Theragenics Corporation of a complete liquidation or dissolution of Theragenics Corporation.

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) “Closing” shall have the meaning set forth in the Introduction to this Agreement.

(i) “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 or prior thereto while an employee of or consultant to the Company or an Affiliate which (i) may be reasonably expected to be used in a product of the Company or an Affiliate, or a product similar to a product of the Company or an Affiliate, (ii) results from work that the Employee has been assigned as part of his duties as an employee of or consultant to the Company or an Affiliate, (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 an Affiliate, or (iv) is useful, or which the Employee reasonably expects may be useful, in any manufacturing or product design process of the Company or an Affiliate.

-3-

(j) “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.

(k) “Confidential Information” means data and information relating to the business of the Company or an Affiliate which is or has been disclosed to the Employee or of which the Employee became aware as a consequence of or through his relationship to the Company or an Affiliate and which has value to the Company or an Affiliate 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 or an Affiliate (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.

(l) “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.

(m)“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; provided that with respect to any of the foregoing events, the Employee gives the Company notice of the event within thirty (30) days of the date of the event and provided the Employee resigns effective upon not less than fourteen (14) days, and not more than thirty (30) days notice to the Company after the expiration of the Company’s thirty (30) day cure period.

(n) “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.

(o) “Stock Purchase Agreement” means the stock purchase agreement referred to in the Introduction to this Agreement.

(p) “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.

-4-

(q) “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.

(r) “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 President and the Employee accepts such employment with the Company in such capacity and agrees to serve as President as long as he is appointed to such position, subject to the terms and conditions hereof. The Employee shall report to the Theragenics Corporation Chief Executive Officer and the Board of Directors of the Company and shall have such authority and responsibilities not inconsistent with his position as shall reasonably be assigned to the Employee from time to time.

(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 $200,000. The Employee’s annual base salary shall be reviewed at least annually by the Compensation Committee of the Board of Directors (the “Compensation Committee”), and the Board of Directors or the Compensation Committee may approve an increase in 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) Short-Term Incentive Plan. The Employee shall be entitled to participate in short-term incentive plans or programs applicable generally to similarly situated management employees of the Company, subject to the terms of the plan or program and the conditions established by the Compensation Committee or the Board of Directors, and subject to the Company’s right to amend or terminate the plan or program at any time.

-5-

(c) Stock Based Compensation. Stock options or other stock-based compensation will be awarded to the Employee at the discretion of the Compensation Committee or the Board of Directors, and pursuant to the stock incentive plan of the Company or an Affiliate.

(d) Vacation. The Employee shall be entitled to vacation in accordance with Company policy, but in any event the Employee shall be entitled to no less than four (4) weeks of vacation per year. Vacation shall be taken at times mutually convenient to the Company and the Employee.

(f) Memberships. The Company will reimburse the Employee for one professional membership which has a business related purpose and is approved by the Company.

(g)Licenses. The Company will reimburse the Employee for the costs associated with keeping in full force the professional licenses he possessed prior to the date of this Agreement, provided that the licenses have a business-related purpose. This benefit shall include two (2) trips per year to attend professional meetings necessary for maintaining the licenses and credentials.

(h)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 $1,000 per year.

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

(j) 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.

(k)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.

(l) 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 similarly situated management 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.

-6-

(m) Automobile Allowance. The Company will pay Employee $500 per month as an automobile allowance.

4. Term, Termination and Termination Payments.

(a) Term. The term of this Agreement (the “Term”) shall commence as of the date of the Closing (the “Commencement Date”) and shall expire on the third (3^rd) anniversary of the Commencement Date, with automatic extensions for successive additional one-year terms, as provided herein. Ninety (90) days before the third (3^rd) anniversary of the Commencement Date and ninety (90) days before each subsequent anniversary of the Commencement Date, the Agreement is extended for an additional one year period unless either party gives prior notice of termination. In the event prior notice of termination is given, this Agreement shall terminate at the end of the remaining Term then in effect.

(b) Termination. The Employee’s employment by the Company hereunder may only be terminated before expiration of the Term (i) by mutual agreement of the Employee and the Company; (ii) by the Employee with Good Reason; (iii) by the Employee without Good Reason upon not less than thirty (30) days written prior notice to the Company; (iv) by the Company without Cause; (v) by the Company for Cause; or (vi) by the Company or the Employee due to the Disability of the Employee. This Agreement shall also terminate immediately upon the death of the Employee. Notice of termination by either the Company or the Employee shall be given in writing and shall specify the basis for termination and the effective date of termination.

(c) Effect of Termination. Upon termination of the Employee’s employment hereunder, the Company shall have no further obligation to the Employee or the Employee’s estate with respect to this Agreement, except for payment of salary and bonus amounts, if any, accrued pursuant to Section 3(a) or 3(b) hereof and unpaid at the Termination Date, and termination payments, if any, set forth in Section 4(e) or 4(f) hereof, as applicable, subject to the provisions of Section 11 hereof. Neither Section 4(e) nor 4(f) applies to a Termination due to the Employee’s Disability or death. Nothing contained herein shall limit or impinge any other rights or remedies of the Company or the Employee under any other agreement or plan to which the Employee is a party or of which the Employee is a beneficiary.

(d) Survival. The covenants of the Employee in Sections 5, 6, 7, 8 and 9 hereof shall survive the termination of the Employee’s employment hereunder and shall not be extinguished thereby.

(e) Certain Terminations not in Connection with a Change in Control. If either the Company terminates the Employee’s employment without Cause or the Employee terminates his employment for Good Reason, and in either event a Change in Control has not occurred within the one year preceding the termination of employment and does not occur within ninety (90) days after the termination of employment, the Company shall be obligated to continue to pay the Employee his annual base salary at the time of termination of employment for two (2) yearsafter termination of employment. Payments made under this Section 4(e) shall be paid as a salary continuation. Notwithstanding the foregoing, if the payment of severance hereunder would fail to meet the requirements of Section 409A(a)(1) of the Internal Revenue Code, no payment

-7-

hereunder shall be made until six months after the Employee’s termination of employment, at which time the Employee shall be paid a lump sum equal to what would otherwise have been the first six months’ of such payments, and thereafter payment of the unpaid balance shall continue on what would otherwise have been the original payment schedule for such unpaid balance.

(f) Certain Terminations in Connection with a Change in Control. If, within ninety (90) days preceding or within one year following a Change in Control, either the Company terminates the Employee’s employment without Cause or the Employee terminates his employment for Good Reason, the Company shall be obligated to pay the Employee an amount equal to whichever of the following results in the Employee receiving a larger after-tax amount: (i) two (2) times the Employee’s annual base salary at the time of termination of employment or (ii) if less than two (2) times the Employee’s annual base salary at the time of termination of employment, then the largest amount that could be paid to the Employee, which will not result in a nondeductible “parachute payment” under Section 280G of the Internal Revenue Code. Such amount shall be paid to the Employee ratably, no less frequently than monthly, over two (2) years following termination. Notwithstanding the foregoing, if the payment of severance hereunder would fail to meet the requirements of Section 409A(a)(1) of the Internal Revenue Code, no payment hereunder shall be made until six months after the Employee’s termination of employment, at which time the Employee shall be paid a lump sum equal to what would otherwise have been the first six months’ of such payments, and thereafter payment of the unpaid balance shall continue on what would otherwise have been the original payment schedule for such unpaid balance.

(g) Notwithstanding any other provision hereof, the Company’s obligation to pay the severance benefit set forth in Section 4(e) or 4(f), if applicable, will be contingent upon the Employee executing and providing to the Company (and not revoking within the revocation period, if any, provided pursuant to the applicable release agreement) the form of release agreement attached hereto as Exhibit A, Exhibit B, or Exhibit C, whichever is determined by the Company to be appropriate. The Employee shall execute the release within such period as is provided for in the applicable release agreement, following the Company’s provision of such release agreement to the Employee in connection with the Employee’s termination of employment.

5. Agreement Not to Compete and Not to Solicit Customers.

(a) Agreement Not to Compete. The Employee agrees that commencing on the Commencement Date and continuing through the Applicable Period, he will not (except on behalf of or with the prior written consent of the Company, which consent may be withheld in Company’s sole discretion), within the Area, either directly or indirectly, on the Employee’s own behalf, or in the service of or on behalf of others, provide services of a similar type or nature as he performs for the Company to any Competing Business. For purposes of this Section 5, the Employee acknowledges and agrees that the Business of the Company is conducted in the Area.

(b) Agreement Not to Solicit Customers. The Employee agrees that commencing on the Commencement Date and continuing through the Applicable Period, he will not, either directly or indirectly, on the Employee’s own behalf or in the service of or on behalf of others, solicit or divert, or attempt to solicit or divert any individual or entity which was an actual or

-8-

actively sought prospective client or customer of the Company or an Affiliate and with whom the Employee had material contact during the Employee’s last two year(s) of employment with the Company to a Competing Business for the purpose of providing products or services in competition with the Business of the Company.

6. Agreement Not to Solicit Employees.

The Employee agrees that commencing on the Commencement Date and continuing through the Applicable Period, he will not, either directly or indirectly, on the Employee’s own behalf or in the service of or on behalf of others, solicit, divert or hire, or attempt to solicit, divert or hire, to any Competing Business in the Area any person employed by the Company or an Affiliate with whom he has had material contact during his employment, whether or not such employee is a full-time employee or a temporary employee of the Company or an Affiliate and whether or not such employment is pursuant to written agreement and whether or not such employment is for a determined period or is at will.

7. Ownership and Protection of Proprietary Information.

(a) Confidentiality. All Confidential Information and Trade Secrets and all physical embodiments thereof received or developed by the Employee while employed by the Company are confidential to and are and will remain the sole and exclusive property of the Company. Except to the extent necessary to perform the duties assigned to him by the Company, the Employee will hold such Confidential Information and Trade Secrets in trust and strictest confidence, and will not use, reproduce, distribute, disclose or otherwise disseminate the Confidential Information and Trade Secrets or any physical embodiments thereof and may in no event take any action causing or fail to take the action necessary in order to prevent, any Confidential Information and Trade Secrets disclosed to or developed by the Employee to lose its character or cease to qualify as Confidential Information or Trade Secrets.

(b) Return of Company Property. Upon request by the Company, and in any event upon termination of the employment of the Employee with the Company for any reason, as a prior condition to receiving any final compensation hereunder (including payments pursuant to Section 4(e) or 4(f) hereof), the Employee will promptly deliver to the Company all property belonging to the Company, including, without limitation, all Confidential Information and Trade Secrets (and all embodiments thereof) then in the Employee’s custody, control or possession.

(c) Survival. The covenants of confidentiality set forth herein will apply on and after the date hereof to any Confidential Information and Trade Secrets disclosed by the Company or developed by the Employee prior to or after the date hereof. The covenants restricting the use of Confidential Information will continue and be maintained by the Employee for a period of two years following the termination of this Agreement. The covenants restricting the use of Trade Secrets will continue and be maintained by the Employee following termination of this Agreement for so long as permitted by the Georgia Trade Secrets Act of 1990, O.C.G.A. § 10-1-760, et seq. and as amended hereafter.

-9-

8. Inventions.

(a) Company Inventions. The Employee agrees that all Company Inventions conceived or first reduced to practice by the Employee during the Term or prior to the Term while an employee of or consultant of the Company, and all patent rights and copyrights to such Company Inventions shall become and remain the property of the Company, and the Employee hereby irrevocably and unconditionally sells, transfers, conveys, assigns and delivers to Company (a) Employee’s entire worldwide right, title and interest in and to the Company Inventions, any continuations, continuations-in-part, divisionals, reissues, re-exams, or extensions thereof, together with the right to sue for and recover and retain damages with respect to past infringements of the Company Inventions by third parties, both foreign and domestic, the same to be held and enjoyed by Company for the Company’s own use and enjoyment, and for the use and enjoyment of its successors, assigns or other legal representatives as fully and entirely as the same would have been held and enjoyed by Employee if this assignment had not been made, (b) all applications for industrial property protection, including, without limitation, all applications for patents, utility models and designs which may heretofore have been filed or may hereafter be filed for said inventions in any country, together with the right to file such applications and the right to claim the same priority rights derived from said patent applications under the patent laws of the United States, the International Convention for the Protection of Industrial Property, or any international agreement or the domestic laws of the country in which any such application is filed, as may be applicable, and (c) all forms of industrial property protection, including, without limitation, patents, utility models and designs which may heretofore have been granted or may hereafter be granted for said inventions in any country and all extensions, renewals and reissues thereof If the Employee conceives an Invention during the Term of this Agreement for which there is a reasonable basis to believe that the conceived Invention is a Company Invention, the Employee shall promptly provide a written description of the conceived Invention to the Company adequate to allow evaluation thereof for a determination by the Company as to whether the Invention is a Company Invention. Notwithstanding the foregoing, the provisions of this Section 8(a) shall not apply to any Invention that the Employee may develop without using the Company’s equipment, supplies, facilities, or trade secret information, except for any Inventions that either (i) relate at the time of conception or reduction to practice of the Invention to the Business of the Company, or to actual or demonstrably anticipated research or development of the Company; or (ii) result from any work performed by the Employee for the Company. 

(b) Prior Inventions. If prior to the Commencement Date the Employee conceived any Invention or acquired any ownership interest in any Invention which (i) is the property of the Employee, or of which the Employee is a joint owner with another person or entity, (ii) is not described in any issued patent as of the Commencement Date, and (iii) would be a Company Invention if such Invention were made during the Term of this Agreement, then (A) with respect to any such Invention described in Exhibit D attached hereto, the Employee hereby agrees that such written description (but no rights to the Invention) is and shall remain the property of the Company and (B) with respect to any such Invention not described in Exhibit D attached hereto, the Employee hereby grants to the Company a nonexclusive, paid up, royalty-free license to use and practice such Invention, including a license under all patents to issue in any country which pertain to such Invention. 

-10-

(c) Prior Patents. The Employee represents to the Company that the Employee owns or has rights to no patents or copyrights, individually or jointly with others, except those described in Exhibit D attached hereto.

(d) Patent Applications. The Employee agrees that should the Company elect to file an application for patent protection, either in the United States or in any foreign country, on a Company Invention of which the Employee was an inventor, the Employee for himself and his successors, heirs and assigns, but at Company’s expense, shall execute all applications, amended specifications, deeds or other instruments, and to do all acts necessary or proper to secure the grant of Letters Patent in the United States and in all other countries to the Company, with specifications and claims in such form as shall be approved by the counsel of the Company and to vest and confirm in Company its successors and assigns, the legal title to all such patents. The Employee further agrees to cooperate with any attorneys or other persons designated by the Company by explaining the nature of any Company Invention for which the Company elects to file an application for patent protection, reviewing applications and other papers and providing any other cooperation reasonably required for orderly prosecution of such patent applications; provided, however, that if the Employee is required to provide such assistance after he has left employment with the Company, the Company shall pay the Employee an hourly rate for his assistance, which shall be determined by converting the Employee’s then current annual salary into an hourly rate of pay. The Company shall be responsible for all expenses incurred for the preparation and prosecution of all patent applications on Company Inventions filed by the Company.  Employee agrees, and Employee further authorizes and grants a limited power of attorney to the Company or its designee, to execute on Employee’s behalf any documents necessary to evidence the assignments granted herein for the United States or any other country without further notice to Employee.

9. Copyrights.

(a) Ownership and Assignment. The Employee acknowledges and agrees that any Works created by the Employee in the course of his employment during the Term or prior to the Term while an employee of or consultant to the Company, are subject to the “Work for Hire” provisions contained in Sections 101 and 201 of the United States Copyright Law, Title 17 of the United States Code, and that all right, title and interest to copyrights in all Works which have been or will be prepared by the Employee within the scope of his employment hereunder shall be the property of the Company.  The Employee further acknowledges and agrees that, to the extent the provisions of Title 17 of the United States Code do not vest in the Company the copyrights to any Works, the Employee hereby assigns to the Company all right, title and interest to copyrights which the Employee may have in such Works, including the right the right to sue for and recover and retain damages with respect to past infringement.

(b) Registration. The Employee agrees to disclose to the Company all Works referred to in the immediately preceding paragraph and execute and deliver all applications for registration, registrations, and other documents relating to the copyrights to the Works and provide such additional assistance, as the Company may deem necessary and desirable to secure the Company’s title to the copyrights in the Works.  The Company shall be responsible for all expenses incurred in connection with the registration of all such copyrights.

-11-

(c) Prior Works. The Employee claims no ownership rights in any Works, except as described in Exhibit D attached hereto.

10.Contracts or Other Agreements with Former Employer or Business.

The Employee hereby represents and warrants that he is not subject to any employment agreement or similar document, except as previously disclosed and delivered to the Company, with a former employer or any business with which the Employee has been associated, which on its face prohibits the Employee during a period of time which extends through the Commencement Date from any of the following: (i) competing with, or in any way participating in a business which competes with the Employee’s former employer or business; (ii) soliciting personnel of such former employer or business to leave such former employer’s employment or to leave such business; or (iii) soliciting customers of such former employer or business on behalf of another business. The Employee hereby further represents and warrants that he has not executed any agreement with any other party which, on its face, purports to require the Employee to assign any Work or any Invention created, conceived or first reduced to practice by the Employee during a period of time which extends through the Commencement Date except as previously disclosed in writing to the Company.

11. Remedies.

(a) The Employee agrees that the covenants and agreements contained in Sections 5, 6, 7, 8 and 9 hereof are of the essence of this Agreement; that each of such covenants is reasonable and necessary to protect and preserve the interests and properties of the Company and the Business of the Company; that the Company is engaged in and throughout the Area in the Business of the Company; that the Employee has access to and knowledge of the Company’s business and financial plans; that irreparable loss and damage will be suffered by the Company should the Employee breach any of such covenants and agreements; that each of such covenants and agreements is separate, distinct and severable not only from the other of such covenants and agreements but also from the other and remaining provisions of this Agreement; that the unenforceability of any such covenant or agreement shall not affect the validity or enforceability of any other such covenant or agreements or any other provision or provisions of this Agreement; and that, in addition to other remedies available to it, the Company shall be entitled to specific performance of this Agreement and to both temporary and permanent injunctions to prevent a breach or contemplated breach by the Employee of any of such covenants or agreements.

(b) In addition to any other rights the Company may have pursuant to this Agreement, if Employee engages in or provides managerial, supervisory, sales, marketing, financial, management information, administrative or consulting services or assistance (collectively “Prohibited Services”) to, or owns (other than ownership of less than five percent (5%) of the outstanding voting securities of an entity whose voting securities are traded on a national securities exchange or quoted on the National Association of Securities Dealers, Inc. Automated Quotation System) a beneficial or legal interest in, any Competing Business within the Area during the Applicable Period, Employee will forfeit any amounts owed to Employee under Section 4(e) or 4(f), as applicable, which have not been paid to Employee by the Company and Employee shall immediately repay to the Company all amounts previously paid to Employee pursuant to Section 4(e) or 4(f), as applicable.

-12-

12. No Set-Off.

The existence of any claim, demand, action or cause of action by the Employee against the Company, or any Affiliate of the Company, whether predicated upon this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of any of its rights hereunder. The existence of any claim, demand, action or cause of action by the Company against the Employee, whether predicated upon this Agreement or otherwise, shall not constitute a defense to the enforcement by the Employee of any of his rights hereunder.

13. Notice.

All notices, requests, demands and other communications required hereunder shall be in writing and shall be deemed to have been duly given if delivered or if mailed, by United States certified or registered mail, prepaid to the party to which the same is directed at the following addresses (or at such other addresses as shall be given in writing by the parties to one another):

If to the Company:	Theragenics Corporation
	5203 Bristol Industrial Way
	Buford, Georgia 30518
:	Attn: Bruce Smith
If to the Employee:	Patrick J. Ferguson
	5433 SE Scenic Lane, #2
	Vancouver, WA 98661

Notices delivered in person shall be effective on the date of delivery.  Notices delivered by mail as aforesaid shall be effective upon the third calendar day subsequent to the postmark date thereof.

14. Miscellaneous.

(a) Assignment.  Neither this Agreement nor any right of the parties hereunder may be assigned or delegated by any party hereto without the prior written consent of the other party.

(b) Waiver.  The waiver by the Company of any breach of this Agreement by the Employee shall not be effective unless in writing, and no such waiver shall constitute the waiver of the same or another breach on a subsequent occasion.

-13-

(c) Arbitration.  Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be adjudicated through binding arbitration before a single arbitrator in accordance with the Commercial Arbitration Rules of the American Arbitration Association (“AAA”) in Atlanta, Georgia, with the Company bearing responsibility for the filing costs charged by the AAA for such arbitration. However the provisions of this Section will not prevent the Company from instituting an action in a court of law under this Agreement for specific performance of this Agreement or temporary or permanent injunctive relief as provided in Section 11 hereof. The parties hereto agree that the exclusive venue for any such lawsuit will be Gwinnett County, Georgia and the Employee consents to the exercise of personal jurisdiction by the Superior Court of Gwinnett County for the purposes of such lawsuit.

Any party who desires to submit a claim to arbitration in accordance with this Section shall file its demand for arbitration with AAA within thirty (30) days of the event or incident giving rise to the claim. A copy of said demand shall be served on the other party in accordance with the notice provisions in Section 13 of this Agreement. The parties agree that they shall attempt in good faith to select an arbitrator by mutual agreement within twenty (20) days after the responding party’s receipt of the demand for arbitration. If the parties do not agree on the selection of an arbitrator within that timeframe, the selection shall be made pursuant to the rules from the panels of arbitrators maintained by the AAA. If the Employee prevails in the dispute, the Company will pay and be financially responsible for all costs, expenses, reasonable attorneys’ fees and reasonable expenses of the arbitrator incurred by the Employee (or the Employee’s estate in the event of his death) in connection with the dispute. Any award rendered by the arbitrator shall be accompanied by a written opinion providing the reasons for the award.

By the Company: __________

By Employee:       __________

The arbitrator’s award shall be final and non-appealable. Nothing in this Subsection shall prevent the parties from settling any dispute or controversy by mutual agreement at any time.

(d) Applicable Law. This Agreement shall be construed and enforced under and in accordance with the laws of the State of Georgia.

(e) Entire Agreement.  This Agreement embodies the entire agreement of the parties hereto relating to the subject matter hereof and supersedes all oral agreements, and to the extent inconsistent with the terms hereof, all other written agreements. Notwithstanding the foregoing, nothing provided herein supersedes any portion of the Stock Purchase Agreement or any other agreement entered into in connection therewith, including, without limitation, the Noncompetition Agreement between Theragenics Corporation and Patrick J. Ferguson.

(f) Amendment.  This Agreement may not be modified, amended, supplemented or terminated except by a written instrument executed by the parties hereto.

(g) Severability.  Each of the covenants and agreements hereinabove contained shall be deemed separate, severable and independent covenants, and in the event that any covenant shall be declared invalid by any court of competent jurisdiction, such invalidity shall not in any manner affect or impair the validity or enforceability of any other part or provision of such covenant or of any other covenant contained herein.

-14-

(h) Captions and Section Headings.  Except as set forth in Section 1 hereof, captions and section headings used herein are for convenience only and are not a part of this Agreement and shall not be used in construing it.

IN WITNESS WHEREOF, the Company and the Employee have each executed and delivered this Agreement as of the date first shown above.

THE COMPANY:

CP MEDICAL CORPORATION

By:/s/ Lynn Rogers

Title: Treasurer and Secretary

ATTEST:

______________________________
Title:______________________________

[CORPORATE SEAL]

THE EMPLOYEE:

By: /s/ Patrick J. Ferguson

Patrick J. Ferguson

::ODMA\PCDOCS\ATL\849670\8

P. Ferguson Employment

-15-

Employee

Under 40

EXHIBIT A

RELEASE AGREEMENT

This Release Agreement (this “Agreement”) is made this _____ day of ________, by ________________________ (the “Employer”) and ____________ (the “Employee”).

Introduction

Employee and the Employer entered into a ________________ Agreement dated ______________ (the “Severance Agreement”) which provides certain severance benefits.

The Severance Agreement requires that as a condition to the payment of severance benefits under the Severance Agreement (the “Severance Benefits”), the Employee must provide a release and agree to certain other conditions.

NOW, THEREFORE, the parties agree as follows:

1. The effective date of this Agreement shall be the date on which Employee signs this Agreement (“the Effective Date”), at which time this Agreement shall be fully effective and enforceable. Employee has been offered twenty-one (21) days from receipt of this Agreement within which to consider this Agreement. Employee understands that he or she may sign this Agreement at any time before the expiration of the twenty-one (21) day review. To the degree Employee chooses not to wait twenty-one (21) days to execute this Agreement, it is because Employee freely and unilaterally chooses to execute this Agreement before that time.

2. In exchange for Employee’s execution of this Agreement and in full and complete settlement of any and all claims, the Employer will provide Employee with the Severance Benefits.

3. The release given by Employee in this Agreement is given solely in exchange for the consideration set forth in this Agreement and such consideration is in addition to anything of value that Employee was entitled to receive prior to entering into this Agreement.

Employee has been advised to consult an attorney prior to entering into this Agreement.

By entering into this Agreement, Employee does not waive rights or claims that may arise after the date this Agreement is executed.

4. This Agreement shall in no way be construed as an admission by the Employer that it has acted wrongfully with respect to Employee or any other person or that Employee has any rights whatsoever against the Employer. The Employer specifically disclaims any liability to or wrongful acts against Employee or any other person on the part of itself, its employees or its agents.

5. As a material inducement to the Employer to enter into this Agreement, Employee hereby irrevocably releases the Employer and each of the owners, stockholders, predecessors, successors, directors, officers, employees, representatives, attorneys, and affiliates (and agents, directors, officers, employees, representatives and attorneys of such affiliates) of the Employer, and all persons acting by, through, under or in concert with them (collectively “Releasees”), from any and all charges, claims, liabilities, agreements, damages, causes of action, suits, costs, losses, debts and expenses (including attorneys’ fees and costs actually incurred) of any nature whatsoever, known or unknown, including, but not limited to, rights arising out of alleged violations of any contracts, express or implied, any covenant of good faith and fair dealing, express or implied, or any tort, or any legal restrictions on the Employer’s right to terminate employees, or any federal, state or other governmental statute, regulation, or ordinance, including, without limitation: (1) Title VII of the Civil Rights Act of 1964, as amended by the Civil Rights Act of 1991 (race, color, religion, sex, and national origin discrimination); (2) the Employee Retirement Income Security Act (“ERISA”); (3) 42 U.S.C. § 1981 (discrimination); (4) the Americans with Disabilities Act (disability discrimination); (5) the Equal Pay Act; (6) Employee Order 11246 (race, color, religion, sex, and national origin discrimination); (7) Employee Order 11141 (age discrimination); (8) Section 503 of the Rehabilitation Act of 1973 (disability discrimination); (9) negligence; (10) negligent hiring and/or negligent retention; (11) intentional or negligent infliction of emotional distress or outrage; (12) defamation; (13) interference with employment; (14) wrongful discharge; (15) invasion of privacy; or (16) violation of any other legal or contractual duty arising under the laws of the State of Georgia or the laws of the United States (“Claim” or “Claims”), which Employee now has, or claims to have, or which Employee at any time heretofore had, or claimed to have, or which Employee at any time hereinafter may have, or claim to have, against each or any of the Releasees, in each case as to acts or omissions by each or any of the Releasees occurring up to and including the Effective Date. Employee covenants and agrees not to institute, or participate in any way in anyone else’s actions involved in instituting any action against any of the Releasees with respect to any Claim released herein.

Notwithstanding the foregoing, this Agreement shall not release any claims the Employee has to any unpaid benefits under any employee benefit plan (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) or to Employee’s right to exercise vested stock options, if any, pursuant to any stock option agreements provided by the Employer to Employee.

6. The Employer and Employee agree that the terms of this Agreement shall be final and binding and that this Agreement shall be interpreted, enforced and governed under the laws of the State of Georgia. The provisions of this Agreement can be severed, and if any part of this Agreement is found to be unenforceable, the remainder of this Agreement will continue to be valid and effective.

-2-

7. This Agreement sets forth the entire agreement between the Employer and Employee and fully supersedes any and all prior agreements or understandings, written and/or oral, between the Employer and Employee pertaining to the subject matter of this Agreement.

8. Employee is solely responsible for the payment of any fees incurred as the result of an attorney reviewing this agreement.

Your signature below indicates your understanding and agreement with all of the terms in this Agreement.

Please take this Agreement home and carefully consider all of its provisions before signing it. Again, you are free and encouraged to discuss the contents and advisability of signing this Agreement with an attorney of your choosing.

PLEASE READ CAREFULLY. THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. YOU ARE STRONGLY ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING THIS DOCUMENT.

IN WITNESS WHEREOF, Employee and Employer have executed this agreement effective as of the date first written above.

EMPLOYEE

________________________

Print Name

________________________ 

 Signature

________________________ 

 Date Signed

CP MEDICAL CORPORATION

By: __________________________

Title:_________________________

-3-

Employee

40 and over

EXHIBIT B

RELEASE AGREEMENT

This Release Agreement (this “Agreement”) is made this _____ day of ________, by ________________________ (the “Employer”) and ____________ (the “Employee”).

Introduction

Employee and the Employer entered into an Employment Agreement dated ________________ (the “Severance Agreement”) which provides certain severance benefits.

The Severance Agreement requires that as a condition to the payment of severance benefits under the Severance Agreement (the “Severance Benefits”), the Employee must provide a release and agree to certain other conditions.

NOW, THEREFORE, the parties agree as follows:

1. Employee has been offered twenty-one (21) days from receipt of this Agreement within which to consider this Agreement. The effective date of this Agreement shall be the date eight (8) days after the date on which Employee signs this Agreement (“the Effective Date”). For a period of seven (7) days following Employee’s execution of this Agreement, Employee may revoke this Agreement, and this Agreement shall not become effective or enforceable until such seven. (7) day period has expired. Employee must communicate the desire to revoke this Agreement in writing. Employee understands that he or she may sign the Agreement at any time before the expiration of the twenty-one (21) day review period. To the degree Employee chooses not to wait twenty-one (21) days to execute this Agreement, it is because Employee freely and unilaterally chooses to execute this Agreement before that time. Employee’s signing of the Agreement triggers the commencement of the seven (7) day revocation period.

2. In exchange for Employee’s execution of this Agreement and in full and complete settlement of any and all claims, the Employer will provide Employee with the Severance Benefits.

3. Employee acknowledges and agrees that this Agreement is in compliance with the Age Discrimination in Employment Act and the Older Workers Benefit Protection Act and that the releases set forth in this Agreement shall be applicable, without limitation, to any claims brought under these Acts.

The release given by Employee in this Agreement is given solely in exchange for the consideration set forth in this Agreement and such consideration is in addition to anything of value that Employee was entitled to receive prior to entering into this Agreement.

Employee has been advised to consult an attorney prior to entering into this Agreement, and this provision of the Agreement satisfies the requirement of the Older Workers Benefit Protection Act that Employee be so advised in writing.

By entering into this Agreement, Employee does not waive rights or claims that may arise after the date this Agreement is executed.

4. This Agreement shall in no way be construed as an admission by the Employer that it has acted wrongfully with respect to Employee or any other person or that Employee has any rights whatsoever against the Employer. The Employer specifically disclaims any liability to or wrongful acts against Employee or any other person on the part of itself, its employees or its agents.

5. As a material inducement to the Employer to enter into this Agreement, Employee hereby irrevocably releases the Employer and each of the owners, stockholders, predecessors, successors, directors, officers, employees, representatives, attorneys, and affiliates (and agents, directors, officers, employees, representatives and attorneys of such affiliates) of the Employer, and all persons acting by, through, under or in concert with them (collectively “Releasees”), from any and all charges, claims, liabilities, agreements, damages, causes of action, suits, costs, losses, debts and expenses (including attorneys’ fees and costs actually incurred) of any nature whatsoever, known or unknown, including, but not limited to, rights arising out of alleged violations of any contracts, express or implied, any covenant of good faith and fair dealing, express or implied, or any tort, or any legal restrictions on the Employer’s right to terminate employees, or any federal, state or other governmental statute, regulation, or ordinance, including, without limitation: (1) Title VII of the Civil Rights Act of 1964, as amended by the Civil Rights Act of 1991 (race, color, religion, sex, and national origin discrimination); (2) the Employee Retirement Income Security Act (“ERISA”); (3) 42 U.S.C. § 1981 (discrimination); (4) the Americans with Disabilities Act (disability discrimination); (5) the Age Discrimination in Employment Act; (6) the Older Workers Benefit Protection Act; (7) the Equal Pay Act; (8) Employee Order 11246 (race, color, religion, sex, and national origin discrimination); (9) Employee Order 11141 (age discrimination); (10) Section 503 of the Rehabilitation Act of 1973 (disability discrimination); (11) negligence; (12) negligent hiring and/or negligent retention; (13) intentional or negligent infliction of emotional distress or outrage; (14) defamation; (15) interference with employment; (16) wrongful discharge; (17) invasion of privacy; or (18) violation of any other legal or contractual duty arising under the laws of the State of Georgia or the laws of the United States (“Claim” or “Claims”), which Employee now has, or claims to have, or which Employee at any time heretofore had, or claimed to have, or which Employee at any time hereinafter may have, or claim to have, against each or any of the Releasees, in each case as to acts or omissions by each or any of the Releasees occurring up to and including the Effective Date. Employee covenants and agrees not to institute, or participate in any way in anyone else’s actions involved in instituting, any action against any of the Releasees with respect to any Claim released herein.

-2-

Notwithstanding the foregoing, this Agreement shall not release any claims the Employee has to any unpaid benefits under any employee benefit plan (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) or to Employee’s right to exercise vested stock options, if any, pursuant to any stock option agreements provided by the Employer to Employee.

6. The Employer and Employee agree that the terms of this Agreement shall be final and binding and that this Agreement shall be interpreted, enforced and governed under the laws of the State of Georgia. The provisions of this Agreement can be severed, and if any part of this Agreement is found to be unenforceable, the remainder of this Agreement will continue to be valid and effective.

7. This Agreement sets forth the entire agreement between the Employer and Employee and fully supersedes any and all prior agreements or understandings, written and/or oral, between the Employer and Employee pertaining to the subject matter of this Agreement.

8. Employee is solely responsible for the payment of any fees incurred as the result of an attorney reviewing this agreement.

Your signature below indicates your understanding and agreement with all of the terms in this Agreement.

Please take this Agreement home and carefully consider all of its provisions before signing it. You may take up to twenty-one (21) days to decide whether you want to accept and sign this Agreement. Also, if you sign this Agreement, you will then have an additional seven (7) days in which to revoke your acceptance of this Agreement after you have signed it. This Agreement will not be effective or enforceable, nor will any consideration be paid, until after the seven (7) day revocation period has expired. Again, you are free and encouraged to discuss the contents and advisability of signing this Agreement with an attorney of your choosing.

PLEASE READ CAREFULLY. THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. YOU ARE STRONGLY ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING THIS DOCUMENT.

-3-

IN WITNESS WHEREOF, Employee and Employer have executed this agreement effective as of the date first written above.

EMPLOYEE

________________________

Print Name

________________________ 

 Signature

________________________ 

 Date Signed

CP MEDICAL CORPORATION

By: __________________________

Title:_________________________

-4-

Employee

40 and over -

Group of terminations

EXHIBIT C

RELEASE AGREEMENT

This Release Agreement (this “Agreement”) is made this _____ day of ________, by ________________________ (the “Employer”) and ____________ (the “Employee”).

Introduction

Employee and the Employer entered into an Employment Agreement dated __________________  (the “Severance Agreement”) which provides certain severance benefits.

The Severance Agreement requires that as a condition to the payment of severance benefits under the Severance Agreement (the “Severance Benefits”), the Employee must provide a release and agree to certain other conditions.

NOW, THEREFORE, the parties agree as follows:

1. Employee has been offered forty-five (45) days from receipt of this Agreement within which to consider this Agreement. The effective date of this Agreement shall be the date eight (8) days after the date on which Employee signs this Agreement (“the Effective Date”). For a period of seven (7) days following Employee’s execution of this Agreement, Employee may revoke this Agreement, and this Agreement shall not become effective or enforceable until such seven (7) day period has expired. Employee must communicate the desire to revoke this Agreement in writing. Employee understands that he or she may sign the Agreement at any time before the expiration of the forty-five (45) day review period. To the degree Employee chooses not to wait forty-five (45) days to execute this Agreement, it is because Employee freely and unilaterally chooses to execute this Agreement before that time. Employee’s signing of the Agreement triggers the commencement of the seven (7) day revocation period.

2. In exchange for Employee’s execution of this Agreement and in full and complete settlement of any and all claims, the Employer will provide Employee with the Severance Benefits.

3. Employee acknowledges and agrees that this Agreement is in compliance with the Age Discrimination in Employment Act and the Older Workers Benefit Protection Act and that the releases set forth in this Agreement shall be applicable, without limitation, to any claims brought under these Acts.

The release given by Employee in this Agreement is given solely in exchange for the consideration set forth in this Agreement and such consideration is in addition to anything of value that Employee was entitled to receive prior to entering into this Agreement.

Employee has been advised to consult an attorney prior to entering into this Agreement, and this provision of the Agreement satisfies the requirement of the Older Workers Benefit Protection Act that Employee be so advised in writing.

By entering into this Agreement, Employee does not waive rights or claims that may arise after the date this Agreement is executed.

4. The Employer has ______________________________________________________________[Employer to describe class, unit, or group of individuals covered by termination program, any eligibility factors, and time limits applicable] and such employees comprise the “Decisional Unit.” Attached as “Attachment 1” to this Agreement is a list of ages and job titles of persons in the Decisional Unit who were and who were not selected for termination and the offer of consideration for signing the Agreement.

5. This Agreement shall in no way be construed as an admission by the Employer that it has acted wrongfully with respect to Employee or any other person or that Employee has any rights whatsoever against the Employer. The Employer specifically disclaims any liability to or wrongful acts against Employee or any other person on the part of itself, its employees or its agents.

6. As a material inducement to the Employer to enter into this Agreement, Employee hereby irrevocably releases the Employer and each of the owners, stockholders, predecessors, successors, directors, officers, employees, representatives, attorneys, and affiliates (and agents, directors, officers, employees, representatives and. attorneys of such affiliates) of the Employer, and all persons acting by, through, under or in concert with them (collectively “Releasees”), from any and all charges, claims, liabilities, agreements, damages, causes of action, suits, costs, losses, debts and expenses (including attorneys’ fees and costs actually incurred) of any nature whatsoever, known or unknown, including, but not limited to, rights arising out of alleged violations of any contracts, express or implied, any covenant of good faith and fair dealing, express or implied, or any tort, or any legal restrictions on the Employer’s right to terminate employees, or any federal, state or other governmental statute, regulation, or ordinance, including, without limitation: (1) Title VII of the Civil Rights Act of 1964, as amended by the Civil Rights Act of 1991 (race, color, religion, sex, and national origin discrimination); (2) the Employee Retirement Income Security Act (“ERISA”); (3) 42 U.S.C. § 1981 (discrimination); (4) the Americans with Disabilities Act (disability discrimination); (5) the Age Discrimination in Employment Act; (6) the Older Workers Benefit Protection Act; (7) the Equal Pay Act; (8) Employee Order 11246 (race, color, religion, sex, and national origin discrimination); (9) Employee Order 11141 (age discrimination); (10) Section 503 of the Rehabilitation Act. of 1973 (disability discrimination); (11) negligence; (12) negligent hiring and/or negligent retention; (13) intentional or negligent infliction of emotional distress or outrage; (14) defamation; (15) interference with employment; (16) wrongful discharge; (17) invasion of privacy; or (18) violation of any other legal or contractual duty arising under the laws of the State of Georgia or the laws of the United States (“Claim” or “Claims”), which Employee now has, or claims to have, or which Employee at any time heretofore had, or claimed to have, or which

Employee at any time hereinafter may have, or claim to have, against each or any of the Releasees, in each case as to acts or omissions by each or any of the Releasees occurring up to and including the Effective Date. Employee covenants and agrees not to institute, or participate in any way in anyone else’s actions involved in instituting, any action against any of the Releasees with respect to any Claim released herein.

Notwithstanding the foregoing, this Agreement shall not release any claims the Employee has to any unpaid benefits under any employee benefit plan (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) or to Employee’s right to exercise vested stock options, if any, pursuant to any stock option agreements provided by the Employer to Employee.

7. The Employer and Employee agree that the terms of this Agreement shall be final and binding and that this Agreement shall be interpreted, enforced and governed under the laws of the State of Georgia. The provisions of this Agreement can be severed, and if any part of this Agreement is found to be unenforceable, the remainder of this Agreement will continue to be valid and effective.

8. This Agreement sets forth the entire agreement between the Employer and Employee and fully supersedes any and all prior agreements or understandings, written and/or oral, between the Employer and Employee pertaining to the subject matter of this Agreement.

9. Employee is solely responsible for the payment of any fees incurred as the result of an attorney reviewing this agreement. 

Your signature below indicates your understanding and agreement with all of the terms in this Agreement.

Please take this Agreement home and carefully consider all of its provisions before signing it. You may take up to forty-five (45) days to decide whether you want to accept and sign this Agreement. Also, if you sign this Agreement, you will then have an additional seven (7) days in which to revoke your acceptance of this Agreement after you have signed it. This Agreement will not be effective or enforceable, nor will any consideration be paid, until after the seven (7) day revocation period has expired. Again, you are free and encouraged to discuss the contents and advisability of signing this Agreement with an attorney of your choosing.

PLEASE READ CAREFULLY. THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. YOU ARE STRONGLY ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING THIS DOCUMENT.

-3-

IN WITNESS WHEREOF, Employee and Employer have executed this agreement effective as of the date first written above.

EMPLOYEE

________________________

Print Name

________________________ 

 Signature

________________________ 

 Date Signed

CP MEDICAL CORPORATION

By: __________________________

Title:_________________________

-4-

ATTACHMENT I

Employees Comprising the “Decisional Unit”

Job Title: Age: Participating: Not Participating:

-5-

Exhibit D

Inventions, Patents and Copyrights

1.  Previously Conceived Inventions

[DESCRIBE ANY INVENTIONS WHICH THE EMPLOYEE DEVELOPED OR HAS AN OWNERSHIP INTEREST IN. IF NONE, INSERT “NONE”. Note: With respect to any such Inventions not described herein, the Company shall have a nonexclusive, paid up, royalty-free license to use and practice such Invention, including a license under all patents to issue in any country which pertain to such Invention.]

2.  Patents

[LIST OR DESCRIBE ALL PATENTS WHICH THE EMPLOYEE OWNS INDIVIDUALLY, WITH OTHERS, OR FOR WHICH APPLICATIONS ARE PENDING. IF NONE, INSERT “NONE”.]

3.  Copyrights

[DESCRIBE ANY WORKS FOR WHICH THE EMPLOYEE CLAIMS THE COPYRIGHT EITHER INDIVIDUALLY OR WITH OTHERS. IF NONE, INSERT “NONE”.]

EX-10.2

Exhibit 10.2

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of May 6, 2005, is made and entered into by and amongTheragenics Corporation, a Delaware corporation (the “Company”), Patrick J. Ferguson and Cynthia L. Ferguson, each a resident of the State of Washington (collectively, the “Stockholders”). The Company and the Stockholders are sometimes herein individually referred to as a “Party” and, collectively, as the “Parties.”

WITNESSETH:

WHEREAS, in connection with the sale of one hundred percent (100%) of the issued and outstanding capital stock of C.P. Medical Corporation, an Oregon corporation (the “Transaction”), pursuant to the terms and conditions of that certain Stock Purchase Agreement, dated as of April 26, 2005 (the “Stock Purchase Agreement”), by and among the Company and the Stockholders, the Company will issue shares of common stock, par value $.01 per share (the “Common Stock”) to the Stockholders;

WHEREAS, as a condition to the consummation of the Transaction, the Company is obligated to provide the Stockholders with certain registration rights with respect to the Common Stock; and

WHEREAS, the Company and the Stockholders desire to enter into this Agreement pursuant to which the Company shall register with the SEC the offer and sale by the Stockholders of the shares of Common Stock received by the Stockholders in connection with the Transaction, subject to the terms and conditions of this Agreement.

NOW, THEREFORE, for good and valuable consideration, the premises and the mutual covenants herein contained, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

Section 1. Definitions.

As used in this Agreement, the capitalized terms shall have the meanings set forth below.

(a)          “Agent” shall mean any Person authorized to act and who acts on behalf of a Party with respect to the transactions contemplated by this Agreement.

(b)          “Agreement” shall have the meaning set forth in the introductory paragraph to this Agreement.

(c)          “Business Day” shall mean any day on which commercial banks are not authorized or required by law to close in the State of Georgia.

(d)          “Common Stock” shall have the meaning set forth in the first recital of this Agreement.

(e)          “Company” shall have the meaning set forth in the introductory paragraph to this Agreement.

(f)          “Effectiveness Period” shall have the meaning set forth in Section 3 of this Agreement.

(g)          “Indemnified Party” shall have the meaning set forth in Section 6(c) of this Agreement.

(h)          “Indemnifying Party” shall have the meaning set forth in Section 6(c) of this Agreement.

(i)          “Party” shall have the meaning set forth in the introductory paragraph to this Agreement.

(j)          “Person” shall mean an individual, partnership, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof.

(k)          “Prospectus” shall mean the prospectus included in the Registration Statement, as amended or supplemented by any prospectus supplement with respect to the terms of the offering of any portion of the Registrable Securities covered by the Registration Statement and all other amendments and supplements to the Prospectus, including post-effective amendments and all material incorporated by reference in such Prospectus.

(l)          “Required Registration Filing Date” shall mean August 15, 2005.

(m)          “Registration Statement” shall have the meaning set forth in Section 3 of this Agreement.

(n)          “Registrable Securities” shall mean shares of Common Stock issued by, or issuable to, the Company to a Stockholder pursuant to the Stock Purchase Agreement.

(o)          “Restricted Securities” shall mean the Registrable Securities upon original issuance thereof, subject to the provisions of Section 2(a) of this Agreement.

(p)          “Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, as in effect from time to time.

(q)          “SEC” shall mean the Securities and Exchange Commission.

(r)          “Stock Purchase Agreement” shall have the meaning set forth in the first recital of this Agreement.

(s)          “Transaction” shall have the meaning set forth in the first recital of this Agreement.

- 2 - -

(t)           “Withdrawn Registration Statement” shall have the meaning set forth in Section 5(a) of this Agreement.

Section 2.             Securities Subject to this Agreement.

(a)          Registrable Securities. The securities entitled to the benefits of Sections 3 and 4 of this Agreement are the Registrable Securities; however, with respect to any particular Registrable Security, only so long as such security continues to be a Restricted Security. A Registrable Security ceases to be a Restricted Security when (i) it has been effectively registered under the Securities Act and disposed of in accordance with the Registration Statement, (ii) it has been distributed pursuant to Rule 144 or Rule 145 (or any similar provisions then in force) under the Securities Act, (iii) it has otherwise been transferred in a private transaction in which the transferor’s rights under this Agreement are not assigned, or (iv) it ceases to be outstanding.

(b)          Holders of Registrable Securities. Any reference herein to a “Holder” or “Holders” of Registrable Securities shall mean any Stockholder.

Section 3.             Required Registration.

The Company shall prepare and file with the SEC, as soon as practicable following the date hereof, but no later than the Required Registration Filing Date, a Registration Statement on Form S-3 pursuant to Rule 415 of the Securities Act(the “Registration Statement”) with respect to all ofthe Registrable Securities, and use its commercially reasonable efforts to cause such Registration Statement to become effective as soon as practicable thereafter. After the Registration Statement filed pursuant to this Section 3 has become effective, the Company shall use its commercially reasonable efforts to keep such Registration Statement (on Form S-3 or such other form as may then be available to the Company) effective for a period (the “Effectiveness Period”) equal to (i) five years from the initial date that the SEC declares such Registration Statement effective (subject to any extension pursuant to Sections 5(b) and 5(c) hereof, or, if such Registration Statement is not effective during any period within such five-year period, such five-year period shall be extended by the number of days that the Registration Statement is not effective), or (ii) such shorter period which shall terminate when all of the Registrable Securities have been sold, or are eligible to be sold within a single three-month period pursuant to Rule 144 or any successor thereto. The Company represents and warrants that it is eligible to register the Registrable Securities on Form S-3 under the Securities Act.

Section 4. Registration Procedures.

With respect to the registration of the Registrable Securities pursuant to this Agreement, the Company will as promptly as reasonably practicable:

(a)          before filing the Registration Statement, the Prospectus or any amendments or supplements thereto (excluding documents to be incorporated by reference therein filed after the effectiveness of the Registration Statement), the Company will, no later than five (5) Business Days prior to filing, furnish to the Holders copies of all such documents in substantially the form proposed to be filed (including documents incorporated therein by

- 3 - -

reference other than documents previously filed with the SEC), to enable the Holders to review such documents prior to the filing thereof, and the Company shall make such reasonable changes thereto (including changes to documents incorporated by reference other than documents previously filed with the SEC) as may be reasonably requested by the Holders;

(b)          prepare and file with the SEC such amendments and post-effective amendments to the Registration Statement as may be necessary to keep the Registration Statement continuously effective for the Effectiveness Period; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed with the SEC pursuant to Rule 424 under the Securities Act; and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such Registration Statement during the applicable period in accordance with this paragraph (b) and the intended methods of disposition by the Holders thereof set forth in such Registration Statement or supplement to the Prospectus;

(c)          notify the Holders promptly, and confirm such notice in writing, (1) when the Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to the Registration Statement or any post-effective amendment, when the same has become effective, (2) of any request by the SEC for amendments or supplements to the Registration Statement or the Prospectus or for additional information, (3) of the issuance by the SEC of any stop order suspending the effectiveness of the Registration Statement or the initiation of any proceedings for that purpose, (4) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, (5) of the happening of any event which makes any statement made in the Registration Statement, the Prospectus or any document incorporated therein by reference untrue or which requires the making of any changes in the Registration Statement, the Prospectus or any document incorporated therein by reference in order to make the statements therein not misleading, so that, in the case of the Registration Statement, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, not misleading, and that in the case of the Prospectus, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and (6)of the Company’s good faith determination that it is appropriate to amend the Registration Statement or supplement the Prospectus before sales of the Registrable Securities continue.

(d)          use its commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of the Registration Statement at the earliest possible time;

(e)          furnish to the Holders, without charge, a reasonable number of conformed copies of the Registration Statement and any post-effective amendment thereto, including financial statements and schedules, all documents incorporated therein by reference and all exhibits (including those incorporated by reference);

- 4 - -

(f)          deliver to the Holders as many copies of the Prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Persons may reasonably request; the Company hereby consents to the use of the Prospectus or any amendment or supplement thereto by the Holders in connection with the offering and sale of the Registrable Securities covered by the Prospectus or any amendment or supplement thereto;

(g)          prior to the date on which the Registration Statement is declared effective, use its commercially reasonable efforts to register or qualify such Registrable Securities for offer and sale under the securities or blue sky laws of such jurisdictions as any Stockholder reasonably requests in writing and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Registrable Securities covered by the Registration Statement; provided, that the Company will not be required to qualify generally to do business in any jurisdiction where it is not then so qualified or to take any action which would subject it to general service of process in any such jurisdiction where it is not then so subject;

(h)          cooperate with the Holders to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold and not bearing any restrictive legends; and enable such Registrable Securities to be in such denominations and registered in such names as the Holders may request at least two (2) Business Days prior to any such sale of Registrable Securities;

(i)          upon the occurrence of any event contemplated by paragraph (c)(5) above, prepare a supplement or post-effective amendment to the Registration Statement or the Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of the Registrable Securities, the Prospectus will not contain an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and

(j)          provide a transfer agent and registrar for all Registrable Securities.

The Company may require the Holders to furnish to the Company such information and documents regarding the distribution of the Registrable Securities by the Holders as the Company may from time to time reasonably request in writing, and the Company’s obligations with respect to registration are subject to such information being provided on a timely basis.

Each of the Holders hereby agrees by acquisition of the Registrable Securities that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 4(c)(5) hereof, such Holder will forthwith discontinue disposition of Registrable Securities until such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 4(i) hereof, or until it is advised in writing by the Company that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings which are incorporated by reference in the Prospectus, and, if so directed by the Company, each Holder will deliver to the Company (at the Company’s expense) all copies, other than permanent file copies then in such Holder’s possession, of the Prospectus covering such Registrable Securities current at the time of receipt of such notice.

- 5 - -

Section 5.          Effect of Withdrawal and Suspension.

(a)          Withdrawal. If the Company shall withdraw the Registration Statement prior to the expiration of the Effectiveness Period (a “Withdrawn Registration Statement”), the Holders that continue to hold the Registrable Securities, which shares were covered by the Withdrawn Registration Statement, shall be entitled to an additional Registration Statement, and the Company shall use its commercially reasonable efforts to (i) prepare and file with the SEC, as soon as practicable following the date of withdrawal of the Withdrawn Registration Statement, an additional Registration Statement on Form S-3, and (ii) keep such additional Registration Statement effective for the remainder of the Effectiveness Period of the Withdrawn Registration Statement. The Company shall reimburse the Holders for all reasonable legal and other advisory fees incurred by the Stockholders in connection with the Withdrawn Registration Statement.

(b)          Intentionally Omitted.

(c)          Suspended Sales. If the Company shall give any notice to suspend the disposition of Registrable Securities pursuant to Section 4(c)(5) hereof, the Company shall extend the period of time during which the Company is required to maintain the effectiveness of the Registration Statement pursuant to Section 3 of this Agreement by the number of days during the period from and including the date of the giving of such notice to and including the date the Holders either are advised by the Company that the use of the Prospectus may be resumed or receive copies of the supplemented or amended Prospectus contemplated by Section 4(j).

Section 6.          Indemnification.

(a)          Indemnification by Company. The Company will indemnify and hold harmless, to the full extent permitted by law, each Holder and their Agents against all losses, claims, damages, liabilities and expenses to which any such Person may be subject, under the Securities Act or otherwise, and reimburse all such Persons for any legal or other expenses incurred with investigating or defending against any such losses, claims, damages or liabilities, insofar as such losses, claims, damages or liabilities arise out of or are based upon any untrue or alleged untrue statement of a material fact contained in a Registration Statement, Prospectus or preliminary prospectus or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or any violation or alleged violation by the Company of the Securities Act, the Securities Exchange Act of 1934, as amended, or applicable “blue sky” laws, except insofar as the same arise out of or are based upon an untrue statement of a material fact or omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, which statement or omission is made therein in reliance upon and in conformity with information furnished to the Company by such Holder, expressly for use therein.

(b)          Indemnification by Holders. Each Holder will, severally but not jointly, indemnify and hold harmless, to the full extent permitted by law, the Company, its directors and officers and each Person who controls the Company (within the meaning of the Securities Act) against any losses, claims, damages, liabilities and expenses to which any such Person may be subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities arise out of or are based upon any untrue or alleged untrue statement of a material fact

- 6 - -

contained in the Registration Statement or Prospectus or preliminary prospectus or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, to the extent, but only if and to the extent, that such untrue or alleged untrue statement or omission or alleged omission is made therein in reliance upon and in conformity with the information furnished by such Holder or any Agent of a Holder specifically for inclusion therein.

(c)          Conduct of Indemnification Proceedings. Any Person entitled to indemnification (the “Indemnified Party”) hereunder will (i) give prompt notice to the indemnifying party (the “Indemnifying Party”) of any claim with respect to which it seeks indemnification, and (ii) unless, in such Indemnified Party’s reasonable judgment, a conflict of interest may exist between such Indemnified Party and Indemnifying Party with respect to such claim, permit such Indemnifying Party to assume at its own expense the defense of such claim with counsel reasonably satisfactory to the Indemnified Party. The Indemnified Party shall have the right to participate in the conduct of such defense by the Indemnifying Party provided that it will pay for the fees of its own counsel. Whether or not such defense is assumed by the Indemnifying Party, the Indemnifying Party will not be subject to any liability for any settlement made without its consent. No Indemnifying Party will consent to entry into any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation. An Indemnifying Party who is not entitled to, or elects not to, assume the defense of a claim will not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such Indemnifying Party with respect to such claim, unless in the reasonable judgment of any Indemnified Party and any other of such Indemnified Parties with respect to such claim, such Indemnified Parties reasonably believe that due to conflict of interests, one counsel will not be in a position to adequately represent all Indemnified Parties, in which event the Indemnifying Party shall be obligated to pay the fees and expenses of such additional counsel or counsels. Failure to give prompt written notice shall not release the Indemnifying Party from its obligations hereunder, except to the extent that the Indemnifying Party demonstrates that the defense of such claim has been materially prejudiced by the Indemnified Party’s failure to give such notice.

(d)          Continued Effect. The indemnification provided for under this Agreement shall remain in full force and effect regardless of any investigation made by or on behalf of the Indemnified Party or any officer, director, Agent or person who controls such Indemnified Party and shall survive the transfer of securities.

(e)          Contribution. If the indemnification provided for in Section 6(a) or 6(b) is due in accordance with the terms hereof, but is held by a court of competent jurisdiction to be unavailable or unenforceable with respect to any losses, claims, damages, liabilities or expenses referred to herein, then each Indemnifying Party in lieu of indemnifying such Indemnified Party shall contribute to the amount paid or payable by such Indemnified Party as a result of the losses, liabilities, claims or damages referred to in Section 6(a) or 6(b) in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and any Indemnified Party on the other hand in connection with the statements or omissions which resulted in such losses, liabilities, claims or damages. The relative fault shall be determined by

- 7 - -

reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information initially supplied or developed by the Indemnifying Party or such Indemnified Party and the Parties’ relative intent, knowledge, access to information and opportunity to correct such untrue statement or omission. The amount paid by an Indemnified Party as a result of the losses, liabilities, claims or damages referred to in the first sentence of this Section 6(e) shall be deemed to include any legal or other expenses reasonably incurred by such Indemnified Party in connection with investigating or defending any action or claim which is the subject of this Section 6(e). No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

Section 7.          Miscellaneous.

(a)          Termination. This Agreement shall terminate upon termination of the Company’s obligations under Section 3 of this Agreement, and shall thereupon be of no further force and effect; provided that Section 6 shall survive the termination of this Agreement.

(b)          No Inconsistent Agreements. The Company will not on or after the date of this Agreement enter into any agreement with respect to its securities which is inconsistent with the rights granted to the Stockholders or otherwise conflicts with the provisions hereof.

(c)          Notices. All notices, requests, demands and other communications required or permitted to be given hereunder shall be given in accordance with Section 10.01 of the Stock Purchase Agreement.

(d)          Entire Agreement. This Agreement contains the entire agreement among the Parties with respect to the subject matter hereof, and supersedes all prior agreements, written or oral, with respect thereto.

(e)          Waivers and Amendments. This Agreement may be amended, superseded, cancelled, renewed or extended, and the terms hereof may be waived, only by a written instrument signed by the Parties or, in the case of a waiver, by the Party waiving compliance. No delay on the part of any Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof.

(f)          Remedies Cumulative. No remedy made available by any of the provisions of this Agreement is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity; provided, however, that in no event shall any party be entitled to recover more than once in respect of any claim.

(g)          Binding Effect; No Assignment. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors. This Agreement is not assignable by the Stockholders without the prior written consent of the Company and any other purported assignment shall be null and void.

- 8 - -

(h) Counterparts. This Agreement may be executed by the Parties hereto in multiple counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same instrument.

(i) Interpretive Provisions.

(i) The words “hereof,” “herein,” “hereunder” and “hereto” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. Except as expressly set forth herein, the term “including” when used with or without the term “without limitation” shall be deemed to be inclusive, and not to the exclusion of any other item except when used with a negative predicate.

(ii) All references herein to Sections, subsections, and clauses shall be deemed references to such parts of this Agreement, unless the context shall otherwise require.

(j) Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

(k)Severability of Provisions. If any provision or any portion of any provision of this Agreement or the application of such provision or any portion thereof to any Person or circumstance, shall be held invalid or unenforceable, the remaining portion of such provision and the remaining provisions of this Agreement, or the application of such provision or portion of such provision as is held invalid or unenforceable to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby.

(l) Choice of Law.This Agreement shall be governed and construed in accordance with the laws of the State of Georgia without regard to the conflicts of laws principles thereof. Each Party hereby irrevocably submits to the exclusive jurisdiction of Fulton County, State of Georgia, in any action or proceeding arising out of or relating to this Agreement and hereby irrevocably agrees, on behalf of itself and on behalf of such Party’s successor’s, that all claims in respect of such action or proceeding may be heard and determined in any such court and irrevocably waives any objection such Party may now or hereafter have as to the venue of any such suit, action or proceeding brought in such a court or that such court is an inconvenient forum.

(m)Waiver of Jury Trial. The Parties hereby waive trial by jury in any judicial proceeding involving, directly or indirectly, any matter (whether in tort, contract or otherwise) in any way arising out of, related to, or connected with this Agreement.

(n) Expenses. The Company shall pay all expenses associated with the preparation of the Registration Statement and the maintaining of its effectiveness. However, the Holders shall be responsible for the filing fees.

[The Remainder of This Page Has Been Intentionally Left Blank]

- 9 - -

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

COMPANY:

THERAGENICS CORPORATION

By: /s/ M. Christine Jacobs        

Name: M. Christine Jacobs        

Title: Chief Executive Officer

STOCKHOLDERS:

By: /s/ Patrick J. Ferguson         

            Patrick J. Ferguson

By: /s/ Cynthia L. Ferguson      

            Cynthia L. Ferguson

[Signature Page to Registration Rights Agreement]