Exhibit 10.16
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as of November
27, 2000 (the "Effective Date") by and between NxSTAGE Medical, Inc., a Delaware
corporation (the "Company" or "NXS"), and Xxxxxx Xxxx, an individual ("Xx.
Xxxx"), residing at 000 Xxxxxx Xxxxxx Xxxx 0, Xxxxxx, XX 00000.
WITNESSETH
WHEREAS, the Company desires to employ Xx. Xxxx to provide certain
services to the Company subject to the terms set forth herein; and
WHEREAS, Xx. Xxxx desires to be employed by the Company in return for
certain compensation and benefits.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. EMPLOYMENT BY THE COMPANY.
Subject to the terms and conditions set forth in this Agreement, the Company
agrees to employ Xx. Xxxx to render full-time services to the Company as its
General Counsel. Xx. Xxxx shall perform the duties and have the responsibilities
and authorities that are customarily associated with her then current title, and
such other duties of an executive nature as may be assigned from time to time by
the President of the Company, consistent with the Bylaws of the Company. As
General Counsel, Xx. Xxxx agrees to devote her best efforts and substantially
all of her business time and attention (except for vacation periods as set forth
herein and reasonable periods of illness or other incapacities permitted by the
Company's general employment policies or, in the absence of such policies,
consistent with the employment policies common to the industry at large) to the
business of the Company and to use the highest degree of professionalism in
performing services for the Company.
2. COMPENSATION.
2.1 Salary. During the term of this Agreement, as compensation for the
proper and satisfactory performance of all duties to be performed and services
to be provided under this Agreement, the Company agrees to pay Xx. Xxxx a base
salary ("Base Salary") in the amount of One Hundred Sixty Five Dollars
($165,000) per year of employment, payable on a semi-monthly basis and in
accordance with the Company's standard payroll practices, less required
deductions for state and federal withholding taxes, Social Security and all
other employee taxes and payroll deductions (the "Semi-Monthly Base Payment").
Xx. Xxxx'x base salary shall be reviewed annually by the President and may be
increased or decreased in the sole discretion of the President; provided,
however, that if at any time during the Period of Employment Xx. Xxxx'x Base
Salary is reduced by more than 15% from the previous fiscal year, except for
across-the-board salary reductions similarly affecting all or substantially all
management employees and
reductions related to the her job performance, then Xx. Xxxx shall be entitled
to terminate her employment with the Company and such termination shall be
considered a Company initiated termination without cause in accordance with
Section 7.3(a) hereof.
2.2 Equity.
(a) As of the Effective Date and subject to the terms of this
Agreement, the Company shall grant to Xx. Xxxx an Qualified stock option,
exercisable at any time during the Period of Employment (as defined below) and
within ten (10) years after the grant of the option (the "Stock Option"), to
purchase an aggregate of fifty one thousand, nine hundred fifty (51,950) shares
of the Company's Common Stock at a price of ($2.00) per share (the "Shares").
Such number of shares of Common Stock constitutes 3/4 of one percent (.75%) of
the fully-diluted shares of capital stock of the Company as of the Effective
Date.
(b) The terms of this Stock Option shall be governed by that certain
Qualified Stock Option Agreement executed by Xx. Xxxx and the Company as of the
Effective Date (the "Option Agreement"), Exhibit B.
(c) In the event that Xx. Xxxx exercises the Stock Option, then,
upon the death or complete and permanent disability of Xx. Xxxx, or upon the
termination of Xx. Xxxx'x employment for any reason, the Company shall have the
right but not the obligation to repurchase from Xx. Xxxx all Shares subject to
such exercise that have not yet vested as of the date of such death, disability
or termination.
3. ADDITIONAL BENEFITS.
3.1 Standard Company Benefits. Xx. Xxxx shall be entitled to all rights
and benefits for which she would be eligible under the terms and conditions of
the Company's standard benefits package in effect from time to time for its
executive employees, including by way of illustration only, long-term disability
insurance, family health care insurance, vacation and sick leave (the "Fringe
Benefits"). For the purpose of calculating vacation benefits, Xx. Xxxx will be
recognized as having >10 years of industry experience as of the Effective Date.
The Company reserves the right to change such Fringe Benefits from time to time
in its sole discretion.
3.2 Accumulation of Fringe Benefits. Xx. Xxxx shall not earn or
accumulate unused vacation or sick leave, or other Fringe Benefits, in excess of
an unused amount equal to the amount of such benefit earned during a one (1)
year period. Furthermore, Xx. Xxxx shall not be entitled to receive payments in
lieu of such unused Fringe Benefits, other than for unused vacation earned and
accumulated at the time the employment relationship terminates. All unused sick
leave and other Fringe Benefits earned during the twelve (12) month period
ending on each anniversary of the Commencement Date shall be forfeited if not
used within ninety (90) days following such anniversary date. Notwithstanding
the foregoing, in the event that the Company adopts a more favorable
accumulation policy for its executive officers, Xx. Xxxx shall be entitled to
the benefits of such more favorable accumulation policy as of the adoption by
the Company thereof.
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4. OUTSIDE ACTIVITIES.
Xx. Xxxx agrees that she will not, without first obtaining the President's prior
written approval, directly or indirectly engage or prepare to engage in any
activity in competition with the Company, provide services to, or establish a
business relationship with, a business or individual engaged in or preparing to
engage in competition with the Company, or accept a seat on the board of
directors or other managing committee or team for any other business entity,
except as otherwise provided herein. For purposes of this paragraph, the holding
of less than one percent (1%) of the outstanding voting securities of any firm,
business or organization in competition with the Company shall not constitute
activities or services precluded by this section.
5. PROPRIETARY AND CONFIDENTIAL INFORMATION OBLIGATIONS.
Xx. Xxxx hereby agrees to execute and acknowledges her obligations pursuant to
the Employee Proprietary Information and Inventions Agreement attached hereto as
Exhibit A (the "Proprietary Information Agreement"), including but not limited
to, the obligation to refrain from using or disclosing the proprietary and
confidential information of the Company. Xx. Xxxx further acknowledges that
these obligations shall survive the termination of Xx. Xxxx'x employment with
the Company.
6. NONSOLICITATION.
While employed by the Company and for one (1) year thereafter, Xx. Xxxx agrees
that in order to protect the Company's confidential and proprietary information
from unauthorized use, Xx. Xxxx will not, either directly or through others,
solicit or attempt to solicit (i) any employee, consultant or independent
contractor of the Company to terminate her relationship with the Company in
order to become an employee, consultant or independent contractor to or for any
other person or business entity or (ii) the business of any customer, vendor or
distributor of the Company which, at the time of termination or one (1) year
immediately prior thereto, was listed on the Company's customer, vendor or
distributor list to the extent that the business solicited relates to products
or services which are directly competitive with those of the Company.
7. TERM AND TERMINATION OF EMPLOYMENT.
7.1 Period of Employment. Xx. Xxxx'x period of employment by the Company
pursuant to this Agreement shall commence on November 27, 2000 (the
"Commencement Date") and shall end upon the date that the employment
relationship is terminated pursuant to this Section 7 (the "Termination Date").
The period of employment commencing on the Commencement Date and ending on the
Termination Date shall be known as the Period of Employment (the "Period of
Employment").
7.2 Termination at Will. Although Xx. Xxxx and the Company anticipate a
long and mutually rewarding employment relationship, Xx. Xxxx and the Company
each acknowledge that either party has the right to terminate Xx. Xxxx'x
employment with the Company at any time for any reason whatsoever, with or
without cause subject, however, to the terms of this Agreement. This at-will
employment relationship cannot be changed except in writing signed by a duly
authorized officer of the Company and Xx. Xxxx.
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7.3 Termination Without Cause or for Good Reason.
(a) The Company may terminate this employment relationship
immediately without Cause upon written notice to Xx. Xxxx. Xx. Xxxx may
terminate her employment for Good Reason (as defined in the Option Agreement) 30
days after the Company has been given written notice specifying the occurrence
of an event in reasonable detail demanding its cure, and provided that the
Company has not cured within, or, if it is not possible to cure such event
within 30 days, if the Company has not taken appropriate steps to begin to cure
such event within such 30 day period. In the event such a termination occurs for
either Good Reason or without Cause as defined by the option agreement, and
provided that Xx. Xxxx has executed a release of liability in favor of NxSTAGE
Medical in a form reasonably acceptable to NxSTAGE Medical, Xx. Xxxx shall
receive a lump sum payment equivalent to her then accumulated but unused
vacation time through the date of termination and, as severance, continued
payment of her Semi-Monthly Base Payment and Consolidated Omnibus Budget
Reconciliation Act (COBRA) payments for a period of time not to exceed six (6)
months after the Termination Date, or until Xx. Xxxx has secured full-time
employment or consulting assignment(s), which ever first occurs (the "Severance
Period"). No other employee benefits will not be continued during this Severance
Period.
i. In the event that, during the Severance Period, Xx. Xxxx
secures full-time employment in which she is paid less per semi-monthly period
than the amount of the Semi-Monthly Base Payment to be received as severance
hereunder, then Xx. Xxxx shall be entitled to be paid reduced severance payments
by the Company equal to the difference between the amount of the Semi-Monthly
Base Payment and the semi-monthly compensation to be paid to Xx. Xxxx pursuant
to such full-time employment or consulting assignment(s).
ii. During this Severance Period and provided Xx. Xxxx does
not secure full time employment, Xx. Xxxx'x options shall continue to vest
according to the vesting schedule outlined in the Option Agreement. In no event
shall Xx. Xxxx'x cumulative vested options at the end of this period be less
than 25% of those granted.
iii. IN THE EVENT THAT XX. XXXX ELECTS TO AND DOES RECEIVE ANY
OF THE BENEFITS PROVIDED UNDER THIS SUBSECTION 7.3, XX. XXXX AGREES THAT SUCH
PAYMENTS SHALL CONSTITUTE HER SOLE AND EXCLUSIVE RIGHTS AND ENTITLEMENTS IN
CONNECTION WITH HER EMPLOYMENT BY THE COMPANY, THE TERMINATION OF SUCH
EMPLOYMENT AND ANY AND ALL MATTERS RELATING TO OR ARISING IN CONNECTION WITH
SUCH EMPLOYMENT, AND AGREES THAT HER ACCEPTANCE OF ANY SUCH PAYMENTS SHALL
RELEASE THE COMPANY AND ANY AND ALL AFFILIATED PERSONS AND ENTITIES (INCLUDING
ALL DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS) FROM ANY CLAIMS THAT XX. XXXX MAY
OTHERWISE HAVE OR ASSERT IN CONNECTION WITH SUCH MATTERS. IF XX. XXXX DESIRES TO
PURSUE OR ENFORCE ANY RIGHTS, ENTITLEMENTS OR REMEDIES THAT WOULD OTHERWISE BE
WAIVED OR RELEASED, THEN SHE SHALL REFUSE ANY PAYMENTS PROVIDED FOR IN THIS
SUBSECTION 7.3. IF XX. XXXX ACCEPTS ANY SUCH SEVERANCE PAYMENT OR PAYMENTS, SHE
SHALL BE DEEMED TO HAVE AGREED TO THE FOREGOING EXCLUSIVITY OF RIGHTS AND WAIVER
OF CLAIMS.
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(b) The Company may immediately terminate this employment
relationship for Cause as defined in the option agreement upon written notice to
Xx. Xxxx. In the event Xx. Xxxx'x employment is terminated at any time with
Cause, all of Xx. Xxxx'x compensation and benefits will cease immediately, and
Xx. Xxxx shall not be entitled to any compensation, severance, acceleration of
vesting or other benefits as of the date of such termination. For purposes of
this Agreement, "for Cause" shall be as that term is defined in the Option
Agreement.
(c) Except as expressly provided herein, Xx. Xxxx will not be
entitled to any other compensation, severance, pay-in-lieu of notice or any
other such compensation upon the termination of her employment by the Company.
This severance provision does not affect the "at will" nature of Xx. Xxxx'x
employment.
7.4 Xx. Xxxx Initiated Termination. Xx. Xxxx may voluntarily terminate
her employment with the Company at any time by giving the Board thirty (30) days
written notice. In the event Xx. Xxxx voluntarily terminates her employment with
the Company for other than Good Reason, all of Xx. Xxxx'x compensation and
benefits will cease as of the termination date. Xx. Xxxx acknowledges that she
will not receive any severance pay or other benefits upon such voluntary
termination, other than a lump sum payment equivalent to her then accumulated
but unused vacation time together with any unpaid benefits and compensation
through the date of termination.
7.5 Exclusive Remedy. The parties agree that the payments and/or
benefits described in subsection 7.3 shall be Xx. Xxxx'x sole and exclusive
remedy in the event the Company terminates Xx. Xxxx'x employment, and Xx. Xxxx
shall be entitled to no further compensation for any damage or injury arising
out of the termination of her employment by NxSTAGE Medical; provided, however,
that nothing contained in this paragraph shall limit Xx. Xxxx'x right to be
indemnified by NxSTAGE Medical for her actions as its officer or employee.
7.6 Obligations Upon Termination.
(a) The obligations of the parties under Sections 5, 6, 7, and 9
shall survive the termination of this Agreement.
(b) Upon the end of the Period of Employment, Xx. Xxxx shall
promptly deliver to the Company all materials, property, documents, data and
other information belonging to the Company or containing the Company's trade
secrets or other Proprietary Information, as such term is defined in the
Proprietary Information Agreement attached hereto as Exhibit A. Xx. Xxxx shall
not take any materials, property, documents or other information, or any
reproduction or excerpt thereof, belonging to the Company or containing any of
the Company's Proprietary Information.
(c) Upon termination of the Period of Employment, Xx. Xxxx shall be
deemed to have resigned from any and all offices then held with the Company.
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8. NOTICES.
All notices, requests, consents and other communications required or permitted
to be given hereunder shall be in writing and shall be deemed to have been duly
given if personally delivered or delivered by registered or certified mail
(return receipt requested), or private overnight mail (delivery confirmed by
such service) to the address listed below, or to such other address as either
party shall designate by notice in writing to the other in accordance with the
terms hereof:
If to the Company:
NxSTAGE Medical, Inc.
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attn: President
If to Xx. Xxxx:
Xx. Xxxx
000 Xxxxxx Xxxxxx
Xxxx 0
Xxxxxx, Xxxxxxxxxxxxx 00000
9. ARBITRATION/ATTORNEYS' FEES.
To ensure rapid and economical resolution of any and all disputes directly or
indirectly arising out of or in any way connected or related to Xx. Xxxx'x
employment with the Company or the termination of that employment, with the sole
exception of disputes which arise under Xx. Xxxx'x Proprietary Information
Agreement (collectively, the "Arbitrable Claims"), the Company and Xx. Xxxx each
agree that any and all such disputes, whether of law or fact of any nature
whatsoever, shall, if such dispute cannot be resolved within thirty (30) days
despite good faith negotiation, be resolved by final and binding arbitration by
Judicial Arbitration and Mediation Services, Inc. ("JAMS") in Boston,
Massachusetts. The Arbitrable Claims include, but are not limited to: any and
all such claims related to salary, bonuses, commissions, stock, stock options,
or any other ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance benefits, or any other form of compensation;
claims pursuant to any federal, state or local law or cause of action including,
but not limited to, the federal Civil Rights Act of 1964, as amended; the
federal Age Discrimination in Employment Act of 1967, as amended; the federal
Americans with Disabilities Act of 1990; tort law; contract law; wrongful
discharge; discrimination; fraud; defamation; emotional distress; and breach of
the implied covenant of good faith and fair dealing. Xx. Xxxx and the Company
acknowledge and agree that any and all rights she may otherwise have to resolve
such Arbitrable Claims by jury trial, by a court, or in any forum other than the
JAMS, are hereby expressly waived. If any party to this Agreement brings an
action under this Agreement, the prevailing party will be entitled to recover
her or its attorneys' fees and costs, as well as any, other relief to which that
party may be entitled.
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10. GENERAL.
10.1 Without in any way limiting the foregoing, this Agreement does not
supersede the terms of Xx. Xxxx'x Option Agreement.
10.2 Entire Agreement. This Agreement, and Exhibit A and B is the
complete, final and exclusive embodiment of the entire agreement between Xx.
Xxxx and the Company with respect to the subject matter hereof. This Agreement
is entered into without reliance upon any promise, warranty or representation,
written or oral, other than those expressly contained herein, and it supersedes,
replaces and substitutes for all prior negotiations, representations, promises,
warranties, or agreements made between Xx. Xxxx and the Company, whether written
or oral, concerning the terms and conditions of Xx. Xxxx'x employment or the
termination of such employment.
10.3 Severability. If a court of competent jurisdiction determines that
any term or provision of this Agreement is invalid or unenforceable, then the
remaining terms and provisions shall be unimpaired. Such court shall have the
authority to modify or replace the invalid or unenforceable term or provision
with a valid and enforceable term or provision which most accurately represents
the parties' intention with respect to the invalid or unenforceable term or
provision.
10.4 Successors and Assigns. This Agreement shall bind the heirs, personal
representatives, successors, assigns, executors and administrators of each
party, and inure to the benefit of each party, its heirs, successors and
assigns. However, because of the unique and personal nature of Xx. Xxxx'x duties
under this Agreement, Xx. Xxxx agrees that she shall not be entitled to delegate
the performance of her duties or assign any of her rights or obligations under
this Agreement.
10.5 Applicable Law. This Agreement shall be deemed to have been entered
into and shall be construed and enforced in accordance with the laws of the
Commonwealth of Massachusetts as applied to contracts made and to be performed
entirely within Massachusetts.
10.6 Jurisdiction and Venue. In the event that any legal proceedings are
commenced in any court with respect to any matter arising under this Agreement,
Xx. Xxxx and the Company specifically consent and agree that the courts of the
Commonwealth of Massachusetts and/or the United States Federal Courts located in
the Commonwealth of Massachusetts shall have exclusive jurisdiction over each of
the parties and such proceedings.
10.7 Headings. The section headings contained herein are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.
10.8 Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original, all of which together shall constitute one
and the same instrument.
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IN WITNESS WHEREOF, the parties have duly authorized and caused this
Agreement to be executed as follows:
Xx. Xxxx, NxSTAGE MEDICAL, INC.
an individual a Delaware corporation
/s/ Xxxxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------- ----------------------------
Date: Nov 27, 00 Name: Xxxxxxx X. Xxxxxxx
Title: President & CEO
Date: Nov-27-2000
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