EMPLOYMENT AGREEMENT
Exhibit 10.8(i)
This EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into in Tel Aviv and effective as of
the 25th day of April, 2001 (“Effective Date”), by and between: TOPSPIN MEDICAL (ISRAEL)
LTD., (“Company”), an Israeli company, whose principal place of business address is Xxxx Xxxxxx 0,
0 Xxx Xxxxxx St., North Industrial Zone, Lod, Israel; and Xxxx Xxxxx (I.D 027865088) of Ramat Gan,
Israel (“Employee”).
WHEREAS Employee wishes to be employed by Company and Company wishes to employ Employee at a
Position as defined below, subject to the terms and conditions detailed below in this Agreement;
and
WHEREAS Employee represents and warrants that he has the qualifications and skills required for the
purposes of performing his obligations hereunder and that there is no hindrance — legal,
contractual or otherwise — for the execution by him of this Agreement, and he has expressed his
wish to be employed with Company in the Position, and;
WHEREAS the parties wish to set forth in writing the terms and conditions of Employee’s
employment with Company, all as detailed below herein and subject to the terms and conditions
contained herein;
NOW, THEREFORE, in consideration of the premises and the mutual promises herein made, and in
consideration of the representations, warranties, and covenants herein contained, the parties agree
as follows:
1. EMPLOYMENT — GENERAL
1.1. Employment. Company hereby employs Employee and Employee hereby accepts
employment upon the terms and conditions set forth hereinafter. Employee’s employment
according to this Agreement shall commence on the Effective Date.
1.2. The Position. The Employee shall be employed as a Chief Financial Officer
and Senior Vice President — Business Development (“Position”) and in such capacity, he
shall be subject to the direction and control of the Board of Directors of the Company and
its CEO.
1.3. Personal Service Contract. The Parties hereto confirm that this is a
personal service contract and that the relationship between the parties hereto shall not be
subject to any general or special collective employment agreement or any custom or practice
of Company in respect to any of its other employees or contractors. Except as expressly
provided in this Agreement, Employee shall not be entitled to any payments or other
benefits in respect of his employment and the termination of his employment with Company.
1.4. Special Degree of Personal Trust. Employee acknowledges and agrees, that
from the perspective of the status, responsibility and terms of employment of Employee, he
shall be counted amongst those employees whose functions require a special degree of
personal trust, and the conditions and circumstances of whose employment do not facilitate
the supervision of their work and rest hours as those expressions are defined in the Hours
of Work and Rest Law, 5711-1951 and accordingly the restrictions specified in the
aforementioned Law and in the Wage Protection Law shall not apply to his employment.
Employee shall not be entitled to demand or receive, inter alia, payment for overtime, as
may be required by the Company, and the amount paid to him as a Salary (as defined below),
shall also include full compensation for overtime hours and for non competition obligations
as specified below.
2. EMPLOYEE’S UNDERTAKINGS. Employee hereby undertakes as follows:
2.1. Carry out of Instructions. To carry out all of the instructions related
to his employment in accordance with all the resolutions of Company’s Board of Directors or
the instructions of the CEO, all as set forth in Section 1.2 above.
2.2. Fidelity. To perform the duties and assignments imposed upon himself in
the scope of his employment with Company with devotion, honesty and fidelity, subject to
Company’s policy in existence from time to time, and to dedicate to the performance of the
said duties all his know-how, qualifications and experience and all the time, diligence and
attention required for the performance thereof efficiently, with fidelity and in accordance
with the requirements of this Agreement, and to use his best endeavors in order to
consolidate Company and to advance the affairs and business of Company and the realization
of its objectives.
2.3. Conflict of Interest. Employee declares that he is not presently
involved, and he undertakes not to become involved in the future, for so long as he is an
employee of Company, in any obligations towards any third party whatsoever which entail any
form of conflict of interest with his employment with Company.
3. COMPENSATION
3.1. Salary. In consideration for Employee’s obligations under this Agreement,
Company shall pay Employee a monthly gross salary of NIS 11,000 for the four months
commencing on the Effective Date and ending on August 24th and a monthly gross
salary of NIS 35,000 afterwards (“Salary”). Every three (3) months the Salary shall be
adjusted in a manner that it shall be linked to the increase of the Consumer Price Index as
known at the date of payment.
Notwithstanding the aforesaid, during the four months commencing
on the Effective Date and ending on August 24th the CEO may decide that it is for
the company’s interest to renegotiate the Employee’s terms of employment. In such case, the
CEO and the Employee will negotiate in good faith, and will agree upon the overall terms of employment.
3.2. Payment. The Salary shall be paid in New Israel Shekels and shall be paid
to him by no later than the 9th of the following month. Review of Employee’s
Salary shall take place by agreement between the Employee and the Board of Directors of
the Company or the CEO of the Company. As provided in Section 3.1 above, the Salary
includes remuneration for working overtime, on days of rest and in consideration for
Employees non competition obligations, and Employee shall not be entitled to any further
remuneration or payment whatsoever other than the Salary and/or benefits, unless expressly
specified in this Agreement. Employee acknowledges that the Salary to which he is entitled
constitutes due consideration for him working overtime and for his non-competition
obligations towards the Company. The Salary, as mentioned in Section 3.1 hereto, and it
alone, shall constitute the sole basis for calculating any of Employee’s rights under any
applicable law, and any other benefits provided under this Agreement shall not be deemed as
the Salary or any part thereof.
3.3. Statuary Deductions. Company shall make the required statutory deductions
from the Salary and from any other amount paid to Employee by Company under this Agreement,
including income tax, social security and healthcare tax, and make the appropriate payments
on behalf of Employee to the Income Tax Authorities, to the Institute of National Insurance
and any other relevant authority.
3.4. Manager’s Insurance Policy. In respect of the term commencing from the
beginning of Employee’s employment in the Company, the Company shall contribute funds on
behalf the Employee to a Managers Insurance Fund in the name of the Employee and/or a
comprehensive financial arrangement at the election of the Employee (“Fund”) and disability
insurance for loss of ability to work (“Disability Insurance”) as specified below.
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3.4.1. The Company shall allocate to the Fund, an aggregated amount equal to
thirteen and a third percent (13.33%) in the following portions; five percent (5%) of
each monthly Salary for pension compensation and eight and a third percent (8.33%) of
each monthly Salary to severance compensation, which shall be payable to the Employee
upon severance whether compensation is required by law or not. The contributions to
the Manager’s Insurance policy shall be paid by the Company in lieu of any other
legal obligation to make payments on account of severance or pension in respect of
Employee’s employment during the Employment Term. Should the provisions made for
severance pay not cover the amount owed by the Company to Employee by law, then the
Company shall pay Employee the difference, all in accordance with Israeli law.
Moreover, the Company will allocate for the purpose of the Disability Insurance a
maximum premium of 2.5% of Employee’s monthly Salary, as provided by the general
approval of the Minister of Labor and Social Welfare regarding payments by employers
to a pension fund and insurance fund in lieu of severance pay, (“General Approval”)
annexed hereto as Exhibit A. The Company shall deduct from Employee’s monthly
Salary an aggregated amount equal to five percent (5%) of Employee’s monthly Salary
for the Fund.
3.4.2. It is hereby agreed, and the parties agree that an agreement providing
the same shall be executed between the parties as an appendix to the Employee’s
Management Insurance policy, that the Employee shall, in the event of any termination
of his employment with the Company (including resignation of Employee), be entitled
to receive a transfer of ownership of the policy into his name, or be entitled to
redeem the policy, in the full amount thereof, all the premiums in respect thereof,
including the severance pay component and the aggregate amount of contributions made
by the Company and by the Employee to the pension fund, due until termination having
been paid in full.
3.5. Education Fund. In respect of the term commencing from the beginning of
Employee’s employment in the Company, the Company shall pay a sum of 7.5% of the Salary and
shall deduct 2.5% from the Salary to be paid on behalf of Employee toward a further
education fund. The Company shall make all the required payments to the tax authorities
with respect to such contribution, if required, on behalf of the Employee, and the income
tax liability on such surplus on such an amount shall be deducted from the Employees gross
Salary. Use of these funds shall be in accordance with the by-laws of the fund. The
Employee hereby grants his consent to such a deduction provided in this section herein.
3.6. Expenses. The Company will reimburse Employee for any documented,
out-of-pocket expenses from time to time properly incurred by Employee in connection with
his employment by Company. Employee shall provide the Company with copies of all invoices,
receipts and other evidence of expenditures as might be required by Company policy from
time to time. It is hereby agreed that with respect to any expense, which exceeds the
amount of $1,500 the Employee shall be required to receive the prior approval of the
Company’s CEO.
3.7. Sick Leave and Recuperation Pay. Employee shall be entitled to sick leave
and Recuperation Pay as provided by law.
3.8. Vacation. Employee shall accrue paid vacation at the rate of twenty
(2020) business days for the first twelve (12) months of his employment, and an extra 1
(one) day for every consecutive year of employment thereafter. Employee may accumulate his
vacation days.
3.9. Reserve Duty. Employee shall continue to receive the Salary (and Company
shall continue to make contributions to the Policy and the education fund) during periods
of military reserve duty. Employee hereby assigns and undertakes to pay to Company any
amounts received from the National Insurance Institute as compensation for such reserve
duty service.
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3.10. Options. The Employee shall be entitled to participate in the Company’s
approved Employee Stock Option Plan. The Employee shall be granted options to purchase a
total of 40,000 Common Stock of Topspin Medical Inc. at an exercise price of $2 per share,
and upon such terms and conditions set forth within the Employee Stock Option Plan. This
total number of stock options includes 12,500 stock options already vested as of the
Effective Date, additional 5,000 stock options to be vested on August 24th, and
additional 22,500 stock options to be vested quarterly and proportionally during a 3 years
period commencing on the Effective Date.
3.11. Car. During the term of this Agreement and the Adaptation Compensation
Period as defined in Section 4.5 below, the Company shall provide Employee with the use of
a company car (the “Company Car”). The Company shall bear all the fixed and variable costs
of the Company Car, including licenses, insurance, gas and repairs. Employee shall bear
the value of the benefit to Employee in placing the car at his disposal as aforesaid in the
amount of the tax applicable to him in respect of the said benefit. It is hereby agreed
that the Employee may use and utilize the Company Car for his personal needs.
3.12. Cell Phone. The Employee shall be entitled to the use of a Company
cellular phone. The Company shall bear all costs and expenses regarding such use.
3.13. Bonuses. The Company’s CEO and/or Board of Directors, by the end of
each calendar year of Employee’s employment, shall consider granting the Employee a bonus
for the year past. In making such a decision, the Company’s CEO and/or Board of Directors
shall take into account the Company’s growth and business performances and Employee’s
contribution at each such year.
4. TERM OF AGREEMENT
4.1. Term. This Agreement is entered into for an indefinite period of time.
4.2. Termination by Employee. Employee shall be entitled to terminate this
Agreement by giving Company a prior notice, to be delivered to Company, in writing, of 60
(sixty) days; It being understood that during such period, Employee shall (subject to the
needs of the Company) continue to perform his duties for Company, including the training
and initiation of his replacement, and, subject to the performance of such obligations,
Company shall make all payments as required hereunder.
4.3. Termination by Company. The Company shall be entitled to terminate this
Agreement, at any time, by giving Employee a prior notice, to be delivered to Employee, in
writing, of 60 (sixty) days. In such an event Employee shall (subject to the needs of the
Company) continue to perform his duties for the Company, including the training and
initiation of his replacement, and, subject to the performance of such obligations, Company
shall make all payments as required hereunder. The Company shall be entitled to terminate
the actual employment of Employee at any time forthwith, including prior to the notice, and
to make a payment to Employee in lieu of such prior notice.
4.4. Termination For Cause. Notwithstanding the foregoing provisions of this
Section 4, Company shall be entitled to terminate this Agreement forthwith, and without
prior notice, and Employee shall not be entitled to any severance pay or other compensation
whatsoever, in any of the following events: (i) Employee breaches any of his obligations
pursuant to this Agreement, including those provided in Sections 5, 6 and 7; (ii) Employee
is convicted of a crime or misdemeanor vis-a-vis the Company; (iii) any employee of Company
and/or any director thereof, or the Company has tangible evidence that Employee (A) has
committed an act of fraud
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vis-a-vis the Company or its directors or any of its employees, or (B) has embezzled in any way
Company moneys, or (C) has, by intentional act or omission, caused damage to Company, or
(D) has in a material conflict of interest situation with the Company, acted to advance
his own private interests, (iv) in any other event according to any applicable law that
entitles an employer not to pay, in whole or in part, severance pay and not to grant prior
notice.
4.5. Adaptation Compensation. Upon the termination of
the employment of the Employee for whatever reason, except for Termination For Cause as
defined in section 4.4, and subject to the Employee serving as an Employee in the Company
for a period of more than one year, the Employee will be entitled to Adaptation
Compensation for a period of two months after the termination of
the agreement and three months in case of serving as an Employee for a period of more than
two years. In such period Employee shall be entitled to compensation detailed in section 3
for the said period.
5. PROPREITARY INFORMATION
5.1. Proprietary Information. The Employee acknowledge and agrees that he will
have access to confidential and proprietary information concerning the business and
financial activities of the Company and information and technology regarding the Company’s
product research and development, including without limitation, the Company’s banking
investments, investors, properties, employees, marketing plans, customers, trade secrets,
and test results, processes, data and know-how, improvements, inventions, techniques and
products (actual or planned). Such information, whether documentary; written oral or
computer generated, shall be deemed to be and referred to as “Proprietary Information”.
Proprietary Information shall be deemed to include any and all preparatory information
disclosed by or on behalf of the Company and irrespective of form, but excluding
information that (i) shall have appeared in any printed publication or patent or shall
have become a part of the public knowledge except as a result of a breach of this
Agreement by the Employee; (ii) reflects general skills and experience gained during the
Employee’s engagement by the Company or (iii) reflects information and data generally
known within the industries or trades in which the Company transacts business.
5.2. Nondisclosure. Employee agrees and declares that all Proprietary
Information, patents and other rights in connection therewith shall be the sole property of
the Company and its assignees at all times. Both during his engagement by the Company and
after its termination. Employee will keep in confidence and trust all Proprietary
Information and the Employee will not use or disclose any Proprietary Information or
anything relating to it without the written consent of the Company, except as may be
necessary in the ordinary course of performing the Employee’s duties hereunder and in the
best interests of the Company.
5.3. Return of Documents. Upon termination of his employment with the Company,
and upon the Company’s request, the Employee will promptly deliver to the Company all
documents and materials of any nature pertaining to his work with the Company, including
but not limited to notebooks, notes, memoranda, records, diagrams, blueprints, bulletins,
formulas, reports, computer programs, other data of any kind coming into Employee’s
possession or prepared by him in connection with his Employment, and he will not take with
him any documents or materials or copies thereof containing any Proprietary Information.
5.4. Third Party Information. Employee recognize that the Company received and
will receive confidential or proprietary information from third parties subject to a duty
on the Company’s part to maintain the confidentiality of such information and to use it
only for certain limited purposes at all times. Both during his employment and after its
termination, the Employee
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undertakes to keep and hold all such information in strict confidence and trust. He will not trust or
disclose any of such information without the prior written consent of the Company, except
as may be necessary to perform his duties as an employee of the Company and consistent
with the Company’s agreement with such third party. Upon termination of his employment
with the Company, Employee shall act with respect to such information as set forth in
Section 5.3, mutatis mutandis.
5.5. Survival. The Employee’s undertakings in this Section 5 shall remain in
full force and effect after termination of this Agreement.
6. DISCLOSURE AND ASSIGNMENT OF INVENTIONS
6.1. Contributions. The Employee understandings that the Company is engaged in
a continuous program of research, development, production and marketing in connection with
its business and that, as an essential part of his employment with the Company, he is
expected to make new contributions to and create inventions of value for the Company.
Employee agrees to share with the Company all his knowledge and experience.
6.2. Obligation to Keep the Company Informed. From and after the date he first
became associated with the Company; Employee undertakes and covenants that he will promptly
disclose in confidence to the Company all inventions, improvements, designs, original works
of authorship formulas, concepts, techniques, methods, systems, processes, compositions of
matter, computer software programs, databases, mask works, and trade secrets, related to
the Company’s business or current or anticipated research and development, whether or not
patentable, copyrightable or protactible as trade secretes, that are made or conceived or
first reduced to practice or created by him, either alone or jointly with others during the
period of his employment, whether or not in the course of his employment (“Inventions”).
6.3. Ownership. All Inventions that (a) are or were developed, whole or in
part on Company’s time or with the use of any equipment, supplies, facilities or trade
secrets of the Company, (b) result directly from any work performed by him for the Company,
or (c) relate to the Company’s business or current or anticipated research and development,
are and will be the sole and exclusive property of the Company (“Company Invention”).
6.4. Assignment of Inventions. The Employee hereby irrevocably transfers and
assigns and will transfer and assign in the future to the Company (a) all worldwide
patents, patent applications, copyrights, mask works, trade secrets and other intellectual
property rights in any Company Invention; and (b) any and all “Moral Rights” (as defined
below) that he may have in or with respect to any Company Invention. Employee also hereby
forever waives and agrees never to assert any and all Moral Rights he may have in or with
respect to any Company Invention, even after termination of his work on behalf of the
Company. “Moral Rights” mean any rights of paternity any right to claim authorship of any
Invention and all right, title and interest worldwide in such Inventions and in all
intellectual property rights based upon such Inventions. To object to any distortion,
mutilation or other modification of, or other derogatory action in relation to any
Invention whether or not such would be prejudicial to his honor or reputation and any
similar right, existing under judicial or statutory law of any country in the world or
under any treaty, regardless of whether or not such right is denominated or generally
referred to as a “Moral Right”.
6.5. Assistance in Obtaining Patents and other Legal Protections. The Employee
agrees to assist the Company to obtain for the Company and enforce patents, copyrights,
mask work rights and other legal protections for the Company’s Inventions in any and all
countries. Employee will execute any documents that the Company may reasonably request for
use in obtaining or
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enforcing such patents, copyrights, mask work rights, trade secrets and other legal
protections. Employees obligation under this Section 6.5 will continue beyond the
termination of his employment with the Company, provided that the Company will compensate
him at a reasonable rate after such termination for time or expenses actually spent by him
at the Company’s request on such assistance. The Employee hereby irrevocably appoints the
Secretary of the Company as his attorney-in-fact to execute documents on his behalf for
this purpose.
7. NON — COMPETITION
7.1. Non Competition. The Employee agrees and undertakes that he will not, so
long as he is employed by the Company and for a period of 18 months following termination
of his employment for whatever reason, directly or indirectly as owner, partner, joint
venturer, stockholder, employee, broker, agent principal, corporate officer, director,
licensor or in any other capacity whatever, engage in, become financially interested in, be
employed by, or have any connection with any business or venture that is engaged in any
activities competing with products or services offered by the Company; provided,
however, that the Employee may own securities of any corporation which is engaged
in such business and is publicly owned and traded but in an amount not exceed at any one
time, one percent of any class of stock or securities of such company, so long as Employee
has no active role in the publicly owned and traded company as director, employee,
consultant or otherwise.
7.2. No Solicitation. Employee agrees and undertakes that during the period of
his employment and for a period of 18 months following termination, he will not, directly
or indirectly, including personally or in any business in which he is an officer, director
or shareholder, for any purpose or in any place, employ in any activity that competes with
Company’s activities, products or services offered by the Company, any key employee
employed by the Company or retained by the Company as a consultant on the date of such
termination or during the preceding twelve months. Employee agrees that during the period
of his Employment with the Company and for 24 months thereafter, he will not solicit or
encourage or cause others to solicit or encourage any key employees of the Company to
terminate their employment with the Company.
7.3. Severability. If any one or more of the terms contained in this Section 7
shall, for any reason be held to be excessively broad with regard to time, geographic scope
or activity, the term shall be construed in a manner to enable it to be enforced to the
extent compatible with applicable law.
8. MISCELLANEOUS
8.1. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Israel.
8.2. Assignments. Employee may not assign or transfer any right, claim or
obligation provided herein. The Company may assign or transfer any right, claim or
obligation provided herein, provided that any right of the Employee under this Agreement
shall not be diminished.
8.3. Notices. The addresses of the parties for the purposes of this Agreement
shall be as specified in the preamble hereto and/or any other address as notified by either
party to the other from time to time.
8.4. Construction. Words in the masculine gender shall include the feminine
and vice versa.
8.5. Entire Agreement. This Agreement contains the entire understanding of the
parties. There are no restrictions, agreements, promises, warranties, covenants or
undertakings between the parties with respect to the subject matter hereof.
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8.6. Amendments. This Agreement may not be altered, modified or amended except
by a written instrument signed by the parties.
IN WITNESS WHEREOF the parties have duly executed this Agreement as of the date first above
written:
/s/ Xxxxx Xxxxxxx /s/ Xxxx Xxxxx
|
/s/ Xxxx Xxxxx | |
TOPSPIN MEDICAL (ISRAEL) LTD. |
EMPLOYEE | |
By: Xxxxx Xxxxxxx & Xxxx Xxxxx |
||
Title: Chairman , CEO |
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