EMPLOYMENT AGREEMENT
Exhibit 10.9
This EMPLOYMENT AGREEMENT (the “Agreement”) dated April 10, 2006, is made by and between
SANUWAVE, Inc., a Delaware corporation (the “Company”), and Xxxxx X. Xxxxxxx (“Executive”).
The Company desires to employ Executive and to enter into an agreement embodying the terms of
such employment; and
Executive desires to accept such employment and to enter into such an agreement; and
In consideration of the premises and mutual covenants herein and for other good and valuable
consideration, the parties agree as follows:
1. Term of Employment. Subject to the provisions of Section 8 of this Agreement,
Executive shall be employed by the Company and its affiliates on the terms and subject to the
conditions set forth in this Agreement. The period of time during which Executive shall be
providing services under this Agreement to the Company and its affiliates shall be known as the
“Employment Term”. The Employment Term shall commence as of the date set forth above and be of no
specific duration. Notwithstanding anything to the contrary herein, Executive shall be an “at
will” employee of the Company during the Employment Term.
2. Position.
a. During the Employment Term, Executive shall serve as the Company’s Chief Financial Officer.
In such position, Executive shall have such duties and authority as shall be determined from time
to time by the Board of Directors, the President, and/or CEO of the Company (the “Board”)
consistent with such position.
b. During the Employment Term, Executive will devote substantially all of Executive’s business
time and attention to the performance of Executive’s duties hereunder and will not engage in any
other business, profession or occupation for compensation or otherwise, without the prior written
consent of the Board.
3. Base Salary. During the Employment Term, the Company shall pay Executive a base
salary at the annual rate of $205,000, payable in regular installments in accordance with the
Company’s usual payment practices but not less often than monthly. Executive shall be entitled to
a performance and compensation review not less often than annually at which time compensation may
be adjusted as may be determined in the sole discretion of the Board. Executive’s annual base
salary, as in effect is hereinafter referred to as the “Base Salary.”
4. Annual Bonus. With respect to each full fiscal year during the Employment Term,
Executive shall be eligible to earn an annual bonus award (an “Annual Bonus”) of forty percent
(40%) of Executive’s Base Salary (the “Target”) based upon the achievement of certain performance
goals established by the Board and generally consistent with the Company’s budget and performance
goals established for other management employees. The Annual Bonus, if any, shall be paid to Executive within two and one-half (2.5) months
after the end of the applicable fiscal year.
5. Equity Arrangements.
a. Options. Simultaneously with the execution of this Agreement, Executive shall be
granted options to acquire 3,057.75 shares of common stock of the Company (“Shares”), which number
is equal to two and three fifths percent (2.6%) of the Company on a fully diluted basis (the
“Options”). The Options shall have an exercise price of $100 per Share, which is equal to the
price that Prides Capital Partners, LLC paid in its initial acquisition of Shares (the “Base
Price”), and which is the fair market value of one Share, as determined by the Board in good faith.
The Options will vest and become exercisable as to twenty-five percent (25%) of the total number
of Shares subject to the Option on each twelve (12) month anniversary of the date of grant.
b. Direct Purchase of Shares. Contingent upon Executive’s commencement of employment
with the Company, Executive shall have the opportunity to purchase up to 1,025 Shares, which number
is equal to one percent (1%) of the Company on a fully diluted basis, at a per share purchase price
equal to $1,000 (the “Investment Shares”), by providing written notice to the Company’s President
prior to September 30, 2006. The Investment Shares acquired by Executive under this Section 5.b
shall be fully vested on the date of such acquisition.
c. Supplemental Options. In addition to the foregoing, simultaneously with the
execution of this Agreement Executive shall be granted three (3) options, which will be in addition
to the Option described in Section 5.a above (the “Supplemental Options”). Two Supplemental
Options will each provide Executive with the right to acquire ) 294 Shares, which is intended to
equal 0.25% each of the Company on a fully diluted basis (the Supplemental Options described in
this sentence will hereinafter be referred to as “Supplemental Option 1” and “Supplemental Option
2”). The third Supplement Option will provide Executive with the right to acquire 441 Shares,
which is intended to equal 0.375% of the Company on a fully diluted basis (the Supplemental Option
described in this sentence will hereinafter be referred to as “Supplemental Option 3”).
Supplemental Option 1 will have an exercise price of $400 per Share, Supplemental Option 2 will
have an exercise price of $800 per Share, and Supplemental Option 3 will have an exercise price of
$1,200 per Share. Supplemental Option 1 will vest and become exercisable as to 100 percent (100%)
of the total number of Shares subject to Supplemental Option 1 on the earlier of (i) the six year
anniversary of the date of grant and (ii) the date that the Company or its shareholders (A) enters
into an agreement or adopts a plan of liquidation pursuant to which Prides Capital Partners, LLC
and its affiliates can reasonably be expected to receive 4.0 times Prides Capital Partners, LLC’s
initial aggregate investment in the Company, (B) enters into a transaction with any person or
entity (including an issuance of options or the sale of equity interests in or assets of the
Company) that establishes a value for the Company on a per share basis equal to at least $400 per
Share or (C) receives a valuation from the Company’s usual financial advisor, or from another
financial firm retained by the Company for the purpose of obtaining such valuation, that
establishes a value for the Company on a per share basis equal to at least $400 per Share.
Supplemental Option 2 will vest and
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become exercisable as to 100 percent (100%) of the total number of Shares subject to
Supplemental Option 2 on the earlier of (i) the six year anniversary of the date of grant and (ii)
the date that the Company or its shareholders (A) enters into an agreement or adopts a plan of
liquidation pursuant to which Prides Capital Partners, LLC and its affiliates can reasonably be
expected to receive 8.0 times Prides Capital Partners, LLC’s initial aggregate investment in the
Company, (B) enters into a transaction with any person or entity (including an issuance of options
or the sale of equity interests in or assets of the Company) that establishes a value for the
Company on a per share basis equal to at least $800 per Share or (C) receives a valuation from the
Company’s usual financial advisor, or from another financial firm retained by the Company for the
purpose of obtaining such valuation, that establishes a value for the Company on a per share basis
equal to at least $800 per Share. Supplemental Option 3 will vest and become exercisable as to 100
percent (100%) of the total number of Shares subject to Supplemental Option 3 on the earlier of (i)
the six year anniversary of the date of grant and (ii) the date that the Company or its
shareholders (A) enters into an agreement or adopts a plan of liquidation pursuant to which Prides
Capital Partners, LLC and its affiliates can reasonably be expected to receive 12.0 times Prides
Capital Partners, LLC’s initial aggregate investment in the Company, (B) enters into a transaction
with any person or entity (including an issuance of options or the sale of equity interests in or
assets of the Company) that establishes a value for the Company on a per share basis equal to at
least $1,200 per Share or (C) receives a valuation from the Company’s usual financial advisor, or
from another financial firm retained by the Company for the purpose of obtaining such valuation,
that establishes a value for the Company on a per share basis equal to at least $1,200 per Share.
For the avoidance of doubt, Executive shall not have the right to require the Company or Prides
Capital Partners, LLC to obtain a valuation of the Company to determine whether any of the
Supplemental Options would vest as provided above. In the event of any change in the outstanding
shares of common stock of the Company after the date hereof by reason of any share dividend or
split, reorganization, recapitalization, merger, consolidation, spin-off, combination, combination
or transaction or exchange of shares or other corporate exchange, any distribution to stockholders,
or any transaction similar to the foregoing, the Board shall make an equitable adjustment to the
specified per Share values and vesting criteria described in this paragraph 5.c.
d. Terms. Executive’s acquisition of Shares under this Section 5 shall be subject to
the stock option agreement pursuant to which the grants are made.
6. Employee Benefits. During the Employment Term, Executive shall be entitled to
participate in the Company’s employee benefit plans (other than annual bonus and incentive plans)
as in effect from time to time (collectively “Employee Benefits”), on the same basis as those
benefits are generally made available to other senior executives of the Company. Executive shall be
entitled to four (4) weeks paid vacation per year during the Employment Term.
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7. Business Expenses and Perquisites. During the Employment Term, reasonable business
expenses incurred by Executive in the performance of Executive’s duties hereunder shall be advanced
or reimbursed by the Company in accordance with Company policies.
8. Termination and Change of Control. The Employment Term and Executive’s employment
hereunder may be terminated by either party at any time and for any reason; provided that Executive
will be required to give the Company at least 30 days advance written notice of any resignation of
Executive’s employment. Notwithstanding any other provision of this Agreement, the provisions of
this Section 8 shall exclusively govern Executive’s rights upon termination of employment with the
Company and its affiliates.
a. By the Company For Cause or By Executive Resignation Without Good Reason.
(i) The Employment Term and Executive’s employment hereunder may be terminated by the Company
for Cause (as defined below) and shall terminate automatically upon Executive’s resignation without
Good Reason (as defined in Section 8(b)); provided that Executive will be required to give the
Company at least 30 days advance written notice of a resignation without Good Reason.
(ii) For purposes of this Agreement, “Cause” shall mean (A) Executive’s continued failure
substantially to perform Executive’s duties hereunder (other than as a result of total or partial
incapacity due to physical or mental illness) for a period of 20 days following written notice by
the Company to Executive of such failure, (B) dishonesty in the performance of Executive’s duties
hereunder, (C) an act or acts on Executive’s part constituting (x) a felony under the laws of the
United States or any state thereof or (y) a misdemeanor involving moral turpitude that could
reasonably be expected to damage the Company or its reputation, (D) Executive’s willful malfeasance
or willful misconduct in connection with Executive’s duties hereunder or (E) Executive’s breach of
the provisions of Sections 9 or 10 of this Agreement.
(iii) If Executive’s employment is terminated by the Company for Cause, or if Executive
resigns without Good Reason, or in the event that Executive’s employment terminates due to
Executive’s death or disability, Executive (or Executive’s beneficiaries, in the event of
Executive’s death) shall be entitled to receive:
| (A) | the Base Salary through the date of termination; | ||
| (B) | any Annual Bonus earned, but unpaid, as of the date of termination for the immediately preceding fiscal year, paid in accordance with Section 4 (except to the extent payment is otherwise deferred pursuant to any applicable deferred compensation arrangement with the Company); |
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| (C) | reimbursement, within 60 days following
submission by Executive to the Company of appropriate supporting
documentation) for any unreimbursed business expenses properly incurred
by Executive in accordance with Company policy prior to the date of
Executive’s termination; provided claims for such reimbursement
(accompanied by appropriate supporting documentation) are submitted to
the Company within 90 days following the date of Executive’s
termination of employment; and |
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| (D) | such Employee Benefits, if any, as to which
Executive may be entitled under the employee benefit plans of the
Company (the amounts described in clauses (A) through (D) hereof being
referred to as the “Accrued Rights”). |
Following such termination of Executive’s employment by the Company for Cause or resignation
by Executive without Good Reason, or on account of Executive’s death or disability, except as set
forth in this Section 8(a)(iii), Executive shall have no further rights to any compensation or any
other benefits under this Agreement.
b. By the Company Without Cause or Resignation by Executive for Good Reason.
(i) The Employment Term and Executive’s employment hereunder may be terminated by the Company
without Cause or by Executive’s resignation for Good Reason.
(ii) For purposes of this Agreement, “Good Reason” shall mean (A) the Company’s substantial
breach of this Agreement including the failure of the Company to pay or cause to be paid
Executive’s Base Salary or Annual Bonus, hereunder, (B) any substantial and sustained diminution in
Executive’s authority or responsibilities as Chief Financial Officer of the Company or (C) any
relocation of the location at which Executive is required to provide his services to a location
that is more than 45 miles from its location as of the date hereof; provided that either of
the events described in clauses (A) and (B) of this Section 8(b)(ii) shall constitute Good Reason
only if the Company fails to cure such event within 30 days after receipt from Executive of written
notice of the event which constitutes Good Reason; provided, further, that “Good
Reason” shall cease to exist for an event on the 60th day following the later of its
occurrence or Executive’s knowledge thereof, unless Executive has given the Company written notice
thereof prior to such date.
(iii) If Executive’s employment is terminated by the Company without Cause or if Executive
resigns for Good Reason, Executive shall be entitled to receive:
| (A) | the Accrued Rights; and | ||
| (B) | subject to Executive’s continued compliance
with the provisions of Sections 9 and 10, and subject to Executive’s
execution of an effective release of claims in a form reasonably
acceptable to the Company, continued payment of the Base Salary in
accordance with the Company’s normal payroll practices, as in effect on
the date of termination of Executive’s employment, until six months
following the date of such termination; and |
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| (C) | continued coverage for Executive and his
qualified beneficiaries under the Company’s health insurance programs
for a period of up to six (6) months through Company reimbursement of
premiums paid by Executive for coverage required under the Consolidated
Omnibus Budget Reconciliation Act of 1985. |
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Following Executive’s termination of employment by the Company without Cause or by Executive’s
resignation for Good Reason, except as set forth in this Section 8(b)(iii), Executive shall have no
further rights to any compensation or any other benefits under this Agreement.
c. Change of Control. In addition to the benefits that Executive may be entitled to
receive under Section 8.b above, if a Change of Control of the Company (as defined below) occurs,
then subject to Executive’s continued compliance with the provisions of Sections 9 and 10, and
subject to Executive’s execution of an effective release of claims in a form reasonably acceptable
to the Company, Executive shall be entitled to receive 100% accelerated vesting of the Options.
d. For purposes of this Agreement, a “Change of Control” means the occurrence of any of the
following events: (1) the sale, exchange, lease or other disposition of all or substantially all of
the assets of the Company to a person or group of related persons, as such terms are defined or
described in Sections 3(a)(9) and 13(d)(3) of the Exchange Act of 1934, as amended (the “Exchange
Act”) (other than Prides Capital Partners, LLC and its affiliates, NightWatch Capital LLC and its
affiliates, or any group controlled by any of the foregoing persons), that will continue the
business of the Company in the future; (2) a merger or consolidation involving the Company in which
the voting securities of the Company owned by the shareholders of the Company immediately prior to
such merger or consolidation do not represent, after conversion if applicable, more than fifty
percent (50%) of the total voting power of the surviving controlling entity outstanding immediately
after such merger or consolidation; provided that any person who (A) was a beneficial owner (within
the meaning of Rules 13d-3 and 13d-5 promulgated under the Exchange Act) of the voting securities
of the Company immediately prior to such merger or consolidation, and (B) is a beneficial owner of
more than 20% of the securities of the Company immediately after such merger or consolidation,
shall be excluded from the list of “shareholders of the Company immediately prior to such merger or
consolidation” for purposes of the preceding calculation; or (3) any person or group (other than
Prides Capital Partners, LLC and its affiliates, NightWatch Capital LLC and its affiliates, or any
group controlled by any of the foregoing persons) is or becomes the Beneficial Owner, directly or
indirectly, of more than 50% of the total voting power of the voting stock of the Company
(including by way of merger, consolidation or otherwise) and the representatives of Prides Capital
Partners, LLC and its affiliates, NightWatch Capital LLC and its affiliates, or any group in which
any of the foregoing persons is a member, individually or in the aggregate, cease to have the
ability to elect a majority of the Board (for the purposes of this clause (3), a member of a group
will not be considered to be the Beneficial Owner of the securities owned by other members of the
group).
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e. Notice of Termination. Any purported termination of employment by the Company or
by Executive (other than due to Executive’s death) shall be communicated by written Notice of
Termination to the other party hereto in accordance with Section 12(h) hereof. For purposes of
this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of employment under the
provision so indicated.
9. Non-Competition.
a. Executive acknowledges and recognizes the highly competitive nature of the businesses of
the Company and its affiliates and accordingly agrees as follows:
(i) During the Employment Term and, for a period of two years following the date Executive
ceases to be employed by the Company (the “Restricted Period”), Executive will not, whether on
Executive’s own behalf or on behalf of or in conjunction with any person, firm, partnership, joint
venture, association, corporation or other business organization, entity or enterprise whatsoever
(“Person”), directly or indirectly solicit or assist in soliciting in competition with the Company
the business of any client or prospective client for the purpose of selling or providing a
Competitive Product or Service.
(ii) During the Restricted Period, Executive will not directly or indirectly:
| (A) | engage in any business that competes with the
business of the Company or its affiliates in selling or providing a
Competitive Product or Service (including, without limitation,
businesses which the Company or its affiliates have specific plans to
conduct in the future and as to which Executive is aware of such
planning) in any geographical area that is within 100 miles of any
geographical area where the Company or its affiliates manufactures,
produces, sells, leases, rents, licenses or otherwise provides its
products or services (a “Competitive Business”); |
||
| (B) | enter the employ of, or render any services to,
any Person who or which (or any division or controlled or controlling
affiliate of such Person) engages in a Competitive Business; provided,
however, that Executive shall be permitted to become an employee of, or
render services to, a Person that engages in a Competitive Business (or
that is a controlled or controlling affiliate of any Person that
engages in a Competitive Business) if Executive’s employment or
provision of services is limited to a line of business of such Person
that does not constitute a Competitive Business, Executive does not
sell or provide a Competitive Product or Service, and Executive does
not otherwise indirectly violate the restrictive covenants set forth
herein; |
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| (C) | acquire a financial interest in, or otherwise
become actively involved with, any Competitive Business, directly or
indirectly, as an individual, partner, shareholder, officer, director,
principal, agent, trustee or consultant; or |
||
| (D) | interfere with, or attempt to interfere with,
business relationships (whether formed before, on or after the date of
this Agreement) between the Company or any of its affiliates and
customers, clients,
suppliers partners, members or investors of the Company or its
affiliates with respect to a Competitive Product or Service. |
(iii) Notwithstanding anything to the contrary in this Agreement, Executive may, directly or
indirectly own, solely as an investment, securities of any Person engaged in the business of the
Company or its affiliates which are publicly traded on a national or regional stock exchange or on
the over-the-counter market if Executive (A) is not a controlling person of, or a member of a group
which controls, such person and (B) does not, directly or indirectly, own 5% or more of any class
of securities of such Person.
(iv) During the Restricted Period, Executive will not, whether on Executive’s own behalf or on
behalf of or in conjunction with any Person, directly or indirectly:
| (A) | solicit or encourage any employee of the
Company or its affiliates to leave the employment of the Company or its
affiliates; or |
||
| (B) | hire any such employee who is at the time
employed by the Company or its affiliates; provided, however, that
nothing herein shall prevent Executive, whether on Executive’s own
behalf or on behalf of or in conjunction with any Person, from hiring
any such employee if such employee initially contacted Executive and
initially solicited an offer of employment from Executive. |
(v) During the Restricted Period, Executive will not, directly or indirectly, solicit or
encourage to cease to work with the Company or its affiliates any consultant then under contract
with the Company or its affiliates.
(vi) For purposes of this Agreement, the term “Competitive Product or Service” means the
products that use or incorporate Extracorporeal Shock Wave Technology for orthopedic or urology
procedures, and any services related to such products.
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b. It is expressly understood and agreed that although Executive and the Company consider the
restrictions contained in this Section 9 to be reasonable, if a final judicial determination is
made by a court of competent jurisdiction that the time or territory or any other restriction
contained in this Agreement is an unenforceable restriction against Executive, the provisions of
this Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum
time and territory and to such maximum extent as such court may judicially determine or indicate to
be enforceable. Alternatively, if any court of competent jurisdiction finds that any restriction
contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make
it enforceable, such finding shall not affect the enforceability of any of the other restrictions
contained herein.
10. Confidentiality; Intellectual Property.
a. Confidentiality.
(i) Executive will not at any time (whether during or after Executive’s employment with the
Company) (A) retain or use for the benefit, purposes or account of Executive or any other Person;
or (B) disclose, divulge, reveal, communicate, share, transfer or provide access to any Person
outside the Company (other than its professional advisers who are bound by confidentiality
obligations), any non-public, proprietary or confidential information —including without
limitation trade secrets, know-how, research and development, software, databases, inventions,
processes, formulae, technology, designs and other intellectual property, information concerning
finances, investments, profits, pricing, costs, products, services, vendors, customers, clients,
partners, investors, personnel, compensation, recruiting, training, advertising, sales, marketing,
promotions, government and regulatory activities and approvals — concerning the past, current or
future business, activities and operations of the Company, its subsidiaries or affiliates and/or
any third party that has disclosed or provided any of same to the Company on a confidential basis
(“Confidential Information”) without the prior written authorization of the Board.
(ii) “Confidential Information” shall not include any information that is (A) generally known
to the industry or the public other than as a result of Executive’s breach of this covenant; (B)
made legitimately available to Executive by a third party without breach of any confidentiality
obligation; or (C) required by law to be disclosed; provided that Executive shall give
prompt written notice to the Company of such requirement, disclose no more information than is so
required, and cooperate with any attempts by the Company to obtain a protective order or similar
treatment.
(iii) Except as required by law, Executive will not disclose to anyone, other than Executive’s
immediate family and legal or financial advisors, the existence or contents of this Agreement;
provided that Executive may disclose to any prospective future employer the provisions of
Sections 9 and 10 of this Agreement provided they agree to maintain the confidentiality of such
terms.
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(iv) Upon termination of Executive’s employment with the Company for any reason, Executive
shall (A) cease and not thereafter commence use of any Confidential Information or intellectual
property (including without limitation, any patent, invention, copyright, trade secret, trademark,
trade name, logo, domain name or other source indicator) owned or used by the Company, its
subsidiaries or affiliates; (B) immediately destroy, delete, or return to the Company, at the
Company’s option, all originals and copies in any form or medium (including memoranda, books,
papers, plans, computer files, letters and other data) in Executive’s possession or control
(including any of the foregoing stored or located in Executive’s office, home, laptop or other
computer, whether or not Company property) that contain Confidential Information or otherwise
relate to the business of the Company, its affiliates and subsidiaries, except that Executive may
retain only those portions of any personal notes, notebooks and diaries that do not contain any
Confidential Information and copies of any agreements to which Executive is a party; and (C) notify
and fully cooperate with the Company regarding the delivery or destruction of any other Confidential Information of which Executive
is or becomes aware.
b. Intellectual Property.
(i) If Executive has created, invented, designed, developed, contributed to or improved any
works of authorship, inventions, intellectual property, materials, documents or other work product
(including without limitation, research, reports, software, databases, systems, applications,
presentations, textual works, content, or audiovisual materials) (“Works”), either alone or with
third parties, prior to Executive’s employment by the Company, that are relevant to or implicated
by such employment (“Prior Works”), Executive hereby grants the Company a perpetual, non-exclusive,
royalty-free, worldwide, assignable, sublicensable license under all rights and intellectual
property rights (including rights under patent, industrial property, copyright, trademark, trade
secret, unfair competition and related laws) therein for all purposes in connection with the
Company’s current and future business. A list of all such material Works, if any, as of the date
hereof is attached hereto as Exhibit A.
(ii) If Executive creates, invents, designs, develops, contributes to or improves any Works,
either alone or with third parties, at any time during Executive’s employment by the Company and
within the scope of such employment and/or with the use of any the Company resources (“Company
Works”), Executive shall promptly and fully disclose same to the Company and hereby irrevocably
assigns, transfers and conveys, to the maximum extent permitted by applicable law, all rights and
intellectual property rights therein (including rights under patent, industrial property,
copyright, trademark, trade secret, unfair competition and related laws) to the Company to the
extent ownership of any such rights does not vest originally in the Company.
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(iii) Executive agrees to keep and maintain adequate and current written records (in the form
of notes, sketches, drawings, and any other form or media requested by the Company) of all Company
Works. The records will be available to and remain the sole property and intellectual property of
the Company at all times.
(iv) Executive shall take all requested actions and execute all requested documents (including
any licenses or assignments required by a government contract) at the Company’s expense (but
without further remuneration) to assist the Company in validating, maintaining, protecting,
enforcing, perfecting, recording, patenting or registering any of the Company’s rights in the Prior
Works and Company Works. If the Company is unable for any other reason to secure Executive’s
signature on any document for this purpose, then Executive hereby irrevocably designates and
appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney
in fact, to act for and in Executive’s behalf and stead to execute any documents and to do all
other lawfully permitted acts in connection with the foregoing.
(v) Executive shall not improperly use for the benefit of, bring to any premises of, divulge,
disclose, communicate, reveal, transfer or provide access to, or share with the Company any
confidential, proprietary or non-public information or intellectual property relating to a former
employer or other third party without the prior written permission of such
third party. Executive hereby indemnifies, holds harmless and agrees to defend the Company
and its officers, directors, partners, employees, agents and representatives from any breach of the
foregoing covenant. Executive shall comply with all relevant policies and guidelines of the
Company, including regarding the protection of confidential information and intellectual property
and potential conflicts of interest. Executive acknowledges that the Company may amend any such
policies and guidelines from time to time, and that Executive remains at all times bound by their
most current version.
(vi) The provisions of Section 10 shall survive the termination of Executive’s employment for
any reason.
11. Specific Performance. Executive acknowledges and agrees that the Company’s
remedies at law for a breach or threatened breach of any of the provisions of Section 9 or Section
10 would be inadequate and the Company would suffer irreparable damages as a result of such breach
or threatened breach. In recognition of this fact, Executive agrees that, in the event of such a
breach or threatened breach, in addition to any remedies at law, the Company, without posting any
bond, shall be entitled to cease making any payments or providing any benefit otherwise required by
this Agreement and obtain equitable relief in the form of specific performance, temporary
restraining order, temporary or permanent injunction or any other equitable remedy which may then
be available.
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12. Miscellaneous.
a. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Georgia, without regard to conflicts of laws principles thereof.
b. Entire Agreement/Amendments. This Agreement contains the entire understanding of
the parties with respect to the employment of Executive by the Company. There are no restrictions,
agreements, promises, warranties, covenants or undertakings between the parties with respect to the
subject matter herein other than those expressly set forth or referenced herein. This Agreement
may not be altered, modified, or amended except by written instrument signed by the parties hereto.
c. No Waiver. The failure of a party to insist upon strict adherence to any term of
this Agreement on any occasion shall not be considered a waiver of such party’s rights or deprive
such party of the right thereafter to insist upon strict adherence to that term or any other term
of this Agreement.
d. Severability. In the event that any one or more of the provisions of this
Agreement shall be or become invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions of this Agreement shall not be affected
thereby.
e. Assignment. This Agreement, and all of Executive’s rights and duties hereunder,
shall not be assignable or delegable by Executive. Any purported assignment or delegation by
Executive in violation of the foregoing shall be null and void ab initio and of
no force and effect. This Agreement may be assigned by the Company to a person or entity
which is an affiliate or a successor in interest to substantially all of the business operations of
the Company. Upon such assignment, the rights and obligations of the Company hereunder shall
become the rights and obligations of such affiliate or successor person or entity.
f. Compliance with IRC Section 409A. Notwithstanding anything herein to the contrary,
(i) if at the time of Executive’s termination of employment with the Company Executive is a
“specified employee” as defined in Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”) and the deferral of the commencement of any payments or benefits otherwise payable
hereunder as a result of such termination of employment is necessary in order to prevent any
accelerated or additional tax under Section 409A of the Code, then the Company will defer the
commencement of the payment of any such payments or benefits hereunder (without any reduction in
such payments or benefits ultimately paid or provided to Executive) until the date that is six
months following Executive’s termination of employment with the Company (or the earliest date as is
permitted under Section 409A of the Code) and (ii) if any other payments of money or other benefits
due to Executive hereunder could cause the application of an accelerated or additional tax under
Section 409A of the Code, such payments or other benefits shall be deferred if deferral will make
such payment or other benefits compliant under Section 409A of the Code, or otherwise such payment
or other benefits shall be restructured, to the extent possible, in a manner, determined by the
Board, that does not cause such an accelerated or additional tax.
g. Successors; Binding Agreement. This Agreement shall inure to the benefit of and be
binding upon personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
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h. Notice. For the purpose of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to have been duly given when
delivered by hand or overnight courier or three days after it has been mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the respective addresses
set forth below in this Agreement, or to such other address as either party may have furnished to
the other in writing in accordance herewith, except that notice of change of address shall be
effective only upon receipt.
If to the Company:
0000 Xxxx Xxx Xxxxxxx, Xxxxx X
Xxxxxxxx, XX 00000
Attention: President
Xxxxxxxx, XX 00000
Attention: President
If to Executive:
To the most recent address of Executive set forth in the personnel records of the Company.
i. Executive Representation. Executive hereby represents to the Company that the
execution and delivery of this Agreement by Executive and the Company and the performance by
Executive of Executive’s duties hereunder shall not constitute a breach of, or otherwise
contravene, the terms of any employment agreement or other agreement or policy to which Executive
is a party or otherwise bound.
j. Prior Agreements This Agreement supersedes all prior agreements and understandings
(including verbal agreements) between Executive and the Company and/or its affiliates regarding the
terms and conditions of Executive’s employment with the Company and/or its affiliates.
k. Cooperation. Executive shall provide Executive’s reasonable cooperation in
connection with any action or proceeding (or any appeal from any action or proceeding) which
relates to events occurring during Executive’s employment hereunder. This provision shall survive
any termination of this Agreement.
l. Withholding Taxes. The Company may withhold from any amounts payable under this
Agreement such Federal, state and local taxes as may be required to be withheld pursuant to any
applicable law or regulation.
m. Counterparts. This Agreement may be signed in counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were upon the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and
year first above written.
| SANUWAVE, INC. | Xxxxx X. Xxxxxxx | |||||
By: |
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Title: |
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