EMPLOYMENT AGREEMENT
EXHIBIT 10.18
THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into as of September 22, 2008
(“Effective Date”) by and between OSI Systems, Inc., a California corporation (the “Company”), and
Xxxx Xxxxxx (“Executive”).
1. ENGAGEMENT AND DUTIES.
1.1 Commencing upon the Effective Date, and upon the terms and subject to the conditions set
forth in this Agreement, the Company hereby engages and employs Executive with the title and
designation of Executive Vice President and Chief Financial Officer of the Company. Executive
shall report to the Company’s Chief Executive Officer.
1.2 Executive agrees to devote his primary business time, energies, skills, efforts and
attention to his duties hereunder and will not, without the prior consent of the Company, which
consent will not be unreasonably withheld, render any material services to any other business
concern. Reasonable bases for the Company to withhold consent include, without limitation,
unreasonable interference with, or other incompatibility with, Executive’s duties to the Company,
so long as such bases are stated in writing by the Company.
1.3 Except for routine travel incident to the business of the Company or the performance of
his duties, Executive shall perform services hereunder primarily at the Company’s offices in
Hawthorne, California, or at such other place as Executive and the Company may from time to time
agree.
2. TERM. This Agreement shall commence as of the Effective Date and, unless sooner
terminated pursuant to Section 4 of this Agreement, shall end upon the later of (i) the third
anniversary of the Effective Date or (ii) one (1) year following the date that the Company notifies
the Executive in writing that the Company elects to end the term of Executive’s employment. The
“Term” of this Agreement shall be the period from the Effective Date until the date on which this
Agreement concludes, whether by action of the parties as described in Section 4 herein, or by
expiration of any renewal period in which notice of non-renewal is provided by either party. For
purposes of this Agreement, the “Completion Date” shall be defined as the final date of the Term.
3. COMPENSATION.
3.1 Base Salary. The Base Salary shall be payable at such times and in such manner as
the Company customarily pays other similarly situated executives but in no event less frequently
than twice per month. Executive’s Base Salary shall be reviewed annually, and shall be subject to
upward adjustment on the basis of such review but shall not in any event be reduced.
3.2 Equity Participation.
3.2.1 To the extent that the Company or its Affiliates maintain one or more equity
participation plans, Executive shall be eligible to participate in such plans; provided, however,
that Executive’s participation in such equity participation plans, and the extent of any such
participation, shall be at the Company’s sole discretion.
3.2.2 Notwithstanding anything to the contrary herein, all stock options and equity awards
granted to Executive by the Company shall become fully vested and nonforfeitable upon a Change in
Control (as defined herein).
3.3 Bonuses. Executive shall participate in the Company’s bonus pool and Executive’s
bonus (if any) shall be determined and paid on the same or similar basis as the bonuses of other
similarly-situated executives. Each bonus payment shall be made no later than September 30 of the
calendar year that contains the last day of the fiscal year or performance year to which the bonus
payment is attributable.
3.4 Fringe Benefits. Executive shall be entitled to participate in and receive
benefits under any plan of the Company made available from time to time to any other similarly
situated executive, provided he is otherwise eligible to participate. Such benefits may include,
without limitation, life insurance, disability insurance, medical/dental/vision insurance, and
retirement benefits, including participation in the Company’s deferred compensation plan.
3.5 Business Expenses. Company shall advance to or reimburse Executive for all
reasonable, ordinary and necessary business expenses incurred by Executive as a result of
Executive’s services hereunder, in accordance with Company policy as established from time to time.
3.6 Vacation and PTO. Executive shall be entitled to vacation and paid time off in
accordance with the Company’s policy applying to other similarly-situated executives, but in no
event less than three weeks vacation and one week paid time off in each year during the Term.
3.7 Relocation Package. In the event of relocation, during the Term, of Executive’s
principal office location more than 25 miles from its location as of the Effective Date, and, as a
result thereof, Executive relocates his principal residence, the Company shall offer Executive a
reasonable relocation package.
4. TERMINATION OF EMPLOYMENT.
4.1 By the Company For Cause. The Company may terminate Executive’s employment under
this Agreement “for cause” at any time upon notice to Executive. “Cause” is defined as: (a)
Executive’s admission or conviction of, or entering of a plea of nolo contendere as to any felony,
or any lesser crime involving fraud, embezzlement or theft; (b) Executive’s failure to
substantially perform his duties, which failure cannot be cured or is not cured within ten (10)
business days after written notice from the Company, as long as Executive is not prevented from
performing or curing by actions outside his control; or (c) Executive’s material breach of any
provision of this Agreement, which breach cannot be cured or is not cured within thirty (30)
business days after written notice from the Company, as long as Executive is not prevented from
performing or curing by actions outside his control.
4.2 By the Company Other Than For Cause. The Company may terminate this Agreement at
any time other than for cause, for the following additional reasons:
4.2.1 Death. In the event of Executive’s death, this Agreement shall
automatically
terminate and all rights of Executive and his heirs, executors and administrators to compensation
and other benefits under this Agreement shall cease; provided, however, that Executive’s
participation in the Company’s employee benefit plans or programs shall cease in accordance with
the terms of such plans or programs as then in effect.
4.2.2 Disability. The Company may, at its option, terminate this Agreement upon
written notice to Executive if Executive, because of physical or mental incapacity or disability,
fails to perform the essential functions of his position required of him hereunder for an aggregate
period of 60 days within any six-month period. Upon such termination, all obligations of the
Company hereunder shall cease; provided, however, that Executive’s participation in the
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Company’s employee benefit plans or programs shall cease in accordance with the terms of such
plans or programs as then in effect.
4.2.3 Without Cause. The Company may terminate Executive’s employment without
cause
upon 30 days’ written notice (“Notice Period”) to Executive. The Company may elect whether or not
Executive shall perform duties under this Agreement during all or a portion of the Notice Period
but shall be required to pay Executive all wages and other compensation as provided for in
Section 3 until the end of the Notice Period (“Notice Period Compensation”).
4.3 Termination By Executive. Executive may terminate this Agreement at any time upon
30 calendar days’ notice (“Executive Notice Period”) to the Company, whether or not such
termination is for Good Reason as described below. The Company may elect whether or not Executive
shall perform duties under this Agreement during all or a portion of the Executive Notice Period
but shall be required to pay Executive all wages and other compensation as provided for in
Section 3 until the end of the Executive Notice Period.
4.3.1 Good Reason. Executive may terminate this Agreement for “Good Reason,”
which
shall mean the occurrence of any of the following events unless the Executive specifically agrees
in writing that such event is not Good Reason provided that (x) Executive terminates this Agreement
within 6 months following the initial existence of one or more of the following events that occur
without Executive’s consent and (y) Executive provides written notice to the Company of the
existence of one or more of the following events within 90 days of the initial existence of such
event or events and the Company fails to remedy such event or events within 30 days of receiving
such notice:
(a) Substantial Reduction in Duties. Any
substantial reduction in duties whereby
Executive’s job responsibilities are markedly and significantly reduced in scope, complexity,
and/or importance to overall Company operations;
(b) Relocation. Following a Change in Control, the
relocation of Executive’s
principal office location more than 25 miles from its location as of the Effective Date;
(c) Reduction in Salary. Executive’s Base
Salary is reduced from any prior year;
(d) Material Breach. Any material breach of the
Agreement by the Company that is not
cured within 10 business days after written notice from Executive;
(e) Change in Title. Any change in Executive’s
titles such that Executive no longer
holds the titles (and duties and privileges commensurate with such titles) set forth in Section
1.1 and instead is given a title with duties and privileges of less importance and stature;
(f) Change in Reporting Relationship. Any change in
the reporting relationship, such
that Executive no longer reports to the Company’s Chief Executive Officer; and
(g) Change in Role. In the event that, for whatever
reason, the Company is no longer
the parent entity in its organizational framework, such that Executive is no longer the Executive
Vice President and Chief Financial Officer of the parent entity.
4.3.2 Without Good Reason. Executive may terminate this Agreement without Good Reason
as defined herein.
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4.4 Payments Upon Termination. Upon expiration or termination of this Agreement for
any reason by either party as described in this Section 4, Executive shall be entitled to receive
payment of (a) Base Salary through the Completion Date; (b) any unused vacation and paid time off
accrued through the Completion Date; and (c) applicable employee benefits to which Executive is
entitled upon the cessation of employment with the Company, in accordance with the terms of the
plans or programs of the Company then in effect. In addition to the above, and subject to
Executive’s execution of a customary and reasonable release of liabilities in favor of the Company,
the following shall apply:
4.4.1 In the event of termination of Executive’s employment by the Company without cause
pursuant to Section 4.2.3 or by Executive for Good Reason pursuant to Section
4.3.1, subject to the provisions of Section 4.4.2 below, Executive shall also be entitled to
the following in addition to the payments described in Section 4.4 above: (a) an amount
equal to 18 months’ salary at Executive’s then-current Base Salary; (b) an amount equal to 1.5
times the average of bonuses paid by the Company to Executive in the three years preceding such
termination; and (c) acceleration of vesting of all stock options and equity grants from the
Company to Executive, and an extension of time to exercise such stock options such that Executive’s
right to exercise such stock options shall continue until the first anniversary of the Completion
Date, but in no event later than the Expiration Date of the options, as defined under the stock
option agreement covering such options.
4.4.2 Within 90 days prior to or 12 months after a Change of Control, if there is either
(A) a
termination of this Agreement by the Company without cause pursuant to Section 4.2.3, or
(B) a termination of this Agreement by Executive for Good Reason pursuant to Section 4.3.1,
then:
(a) Equity and stock options granted by the Company to Executive
shall, to the extent
unvested, immediately vest, and such stock options shall remain exercisable by Executive for no
less than 12 months after the date of such termination.
(b) In addition to the provisions of Section 4.4 above, and
in lieu of the payments described
in Sections 4.4.1(a) and 4.4.1(b) above, Executive shall be entitled to (a) an amount equal to 24
months’ salary at Executive’s then-current Base Salary; and (b) an amount equal to twice the
average of bonuses paid by the Company to Executive in the three years preceding such termination.
(c) If a termination of this Agreement covered by this
Section 4.4.2 is contingent
upon a change in ownership or effective control of Company or a change in the ownership of a
substantial portion of the assets of the Company (within the meaning of Section 280G(b)(2)(i) of
the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations thereunder
(collectively, a “280G Event”)), then Executive, at his option, may elect to receive the
compensation and benefits otherwise payable under Sections 4.4.2(a) and (b), or the
Alternative Payment (as defined below) in lieu of the compensation and benefits otherwise payable
under Sections 4.4.2(a) and (b). In order to elect the Alternative Payment, Executive must
give written notice to Company of such election: (i) within fifteen (15) days after his resignation
with good reason; or (ii) within fifteen (15) days after he is terminated by Company without cause
(each, a “Alternative Payment Notice”). For purposes of this Agreement, “Alternative Payment”
means a lump sum payment made by Company to Executive in immediately available funds in an amount
equal to the product of 2.99 (or, if Code Section 280G(b)(2)(A)(ii) is amended providing for a
multiple other than 3, then the multiple as amended, less 0.01) multiplied by Executive’s “base
amount” (as defined in Code Section 280G(b)(3)); provided, however, that in the case of a 280G
Event, the amount of the Alternative
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Payment shall be reduced by the value of acceleration (as determined under Code Section 280G
and the regulations thereunder) of any equity or stock options accelerated hereunder. Payments to
Executive upon termination of this Agreement under this Section 4.4.2 shall be subject to
mitigation as provided in Treasury Regulations Section 1.280G-1 Q&A 42(c)(5). The value (as
determined under Code Section 280G and the regulations thereunder) of acceleration of vesting of
equity or stock options granted by the Company to Executive shall be taken into account to the
minimum extent necessary so as not to violate Treasury Regulations Section 1.280G-1 Q&A 42(c).
4.4.3 “Change in Control” means the occurrence of any of the following events during the
Term
of the Agreement: (i) any sale, lease, license, exchange or other transfer (in one transaction or
a series of related transactions) of all, or substantially all, of the business and/or assets of
the Company; (ii) a merger or consolidation of the Company and the Company is not the surviving
entity; (iii) a reorganization or liquidation of the Company; (iv) a merger, consolidation, tender
offer or any other transaction involving the Company if the equity holders of the Company
immediately before such merger, consolidation, tender offer or other transaction do not own,
directly or indirectly, immediately following such merger, consolidation, tender offer or other
transaction, more than fifty percent (50%) of the combined voting power of the outstanding voting
securities of the entity resulting from such merger, consolidation, tender offer or other
transaction; (v) Xxxxxx Xxxxxx ceases to be Chief Executive Officer of the Company, unless his
termination from employment with the Company is by reason of a voluntary termination; (vi) a change
in the composition of the Company’s Board as a result of which fewer than a majority of the
directors are Incumbent Directors; or (v) the consummation of any other transaction involving a
significant issuance of the Company’s securities, or other material event, that the Company’s Board
determines to be a Change in Control. The term “Incumbent Directors” shall mean directors who
either: (A) are directors of the Company as of the Effective Date hereof; or (B) are nominated for
election to the Board of the Company with the affirmative votes of at least a majority of the
directors of the Company who are Incumbent Directors (“Approved Successors”) described in (A) above
at the time of such nomination; or (C) are nominated for election to the Board of the Company with
the affirmative votes of at least a majority of the directors of the Company who are Incumbent
Directors or their Approved Successors. Notwithstanding the foregoing, “Incumbent Directors” shall
not include an individual whose election or nomination is in connection with an actual or
threatened proxy contest relating to the election of directors to the Company.
4.4.4 Subject to the terms of the Company’s benefit plans, in the event of a termination of
this Agreement by the Company without cause pursuant to Section 4.2.3 or by Executive for
Good Reason pursuant to Section 4.3.1, if at the Completion Date, the Executive was covered
as an active employee under the Company’s group health plan(s), the Executive will be entitled to
purchase continuation coverage under Company’s group health plan pursuant to the provisions of the
Consolidated Omnibus Budget Reconciliation Act, 29 U.S.C. Section 1161, et. seq. (“COBRA”) and
applicable state law (“Continuation Coverage”) for himself and his dependents, if such dependents
constitute “qualified beneficiaries” under COBRA, and the following provisions will apply thereto:
(a) The Company will pay the premiums for the Executive’s
and, as applicable, his eligible
dependents’ Continuation Coverage for coverage at the same level in which the Executive and, as
applicable, his eligible dependents were enrolled as of the day before the Executive’s termination
of employment for the period beginning on his termination from employment and ending on the last
day of the twenty fourth calendar month after the Executive’s termination of employment (the
“Continuation Period”). For purposes of this
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Agreement, the amounts contributed by the Company for Continuation Coverage on behalf of the
Executive and, as applicable, his eligible dependents, are referred to as the “Premium Payments.”
(b) In the event and on the date that the Executive becomes
covered under another group health
plan without any preexisting condition limitations or exclusions, the Company’s obligation to pay
the premiums for Continuation Coverage will cease. The Executive acknowledges that he is not
entitled to the Premium Payments except as a contribution for Continuation Coverage and only as
specifically provided herein. The Executive will promptly notify the Company in writing if he
becomes covered under another group health plan prior to the end of the Continuation Period.
4.4.5 Subject to Section 8.12, payments upon termination under this Section
4.4 shall be made in a single lump-sum cash payment, less appropriate deductions and
withholding, on the Completion Date or, with respect to payments described in Sections 4.4.1 and
4.4.2, upon Executive’s “separation from service” within the meaning of Section 409A (as such term
is defined in Section 8.12) if such separation from service occurs after the Completion Date. The
Company’s liability for wages and benefits upon termination of this Agreement is limited to the
obligations set forth herein.
5. PROTECTION OF CONFIDENTIAL INFORMATION; NON-SOLICIT.
5.1 Executive acknowledges that his work for the Company will bring him into close contact
with many confidential affairs of the Company not readily available to the public, and hereby
agrees that he will not at any time (both during the Term and thereafter) disclose to any person,
including any legal entity (except the Company and its Affiliates), any Confidential Information,
and will only use Confidential Information for the Company’s benefit; provided, however, that
Executive may use and disclose Confidential Information to the extent necessary to assert any right
or defend against any claim arising under this Agreement or pertaining to Confidential Information
or its use, to the extent necessary to comply with any applicable statute, constitution, treaty,
rule, regulation, ordinance or order, or if Executive receives a request to disclose all or any
part of the information contained in the Confidential Information under the terms of a subpoena,
order, civil investigative demand or similar process issued by a court of competent jurisdiction or
by a governmental body or agency after giving prior notice to the Company. “Confidential
Information” includes but is not limited to information or documents Executive has access to during
the Term which relate to the Company’s operations, marketing, sales, or product development
including, without limitation, records that are identified as, or that can reasonably be
characterized as, confidential; employee names, duties and contact information; customer identities
and lists, customer contacts, information about customer requirements and preferences; forecasts,
budgets, and other financial information; plans, strategic, tactical or otherwise; data, computer
programs, manuals, formulae, specifications, processes, methods, intangible rights and other
similar items; provided that “Confidential Information” does not include information that at the
time of disclosure has previously been made generally available to the public by any authorized
action of the Company or is otherwise available to the public. “Affiliate” is a person or entity
that directly, or indirectly, through one or more intermediaries, controls, is controlled by, or is
under common control with, the Company.
5.2 Upon termination of this Agreement for any reason, Executive shall return to the Company
all Confidential Information in his possession, custody or control.
5.3 Executive agrees that he will not, during the Term and for a period of two years
thereafter, solicit, directly or indirectly, any individual who was an executive, supervisor or
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manager of the Company as of the Completion Date, or within 90 days prior to the Completion
Date, to terminate his/her employment with the Company. Nothing herein shall prevent Executive
from, at some point in the future, working for an entity which may also employ former employees of
the Company.
6. GRANT OF RIGHTS.
6.1 Executive hereby grants, transfers, conveys and assigns to the Company, its successors and
assigns, all right, title, and interest in and to all work, materials and intellectual property of
any and all forms constituting or otherwise relating to his performance of his duties hereunder,
including the copyright, patent, trade secret rights, and all other right, title, and interest
therein, and consisting of all source code, object code, documentation, flow charts, design
documents, and record and file layouts relating thereto, and all trademarks, service marks, logos
and trade dress associated therewith, and any discovery, concept or idea, whether or not
patentable, made during such performance including, but not limited to, processes, methods,
formulae and techniques, improvements thereof and know-how relating thereto (collectively, the
“Property”). This exclusive conveyance shall include, but is not limited to, all rights to publish,
reproduce, transmit, adapt, prepare derivative works, sell, or otherwise make use of the Property
(including all subsequent additions, revisions, supplements to, and versions of the Property and
derivatives, regardless of nature) throughout the world, in any form or medium and in any language,
and to license or otherwise transfer to others the rights commensurate herewith in connection with
the Property, to file copyright and patent applications in the United States and throughout the
world for the Property in the name of the Company, its successors and assigns. Executive hereby
agrees that the Company, it successors and assigns may act as attorney-in-fact to execute any
document that the Company, its successors or assigns deem necessary to record this grant with the
United States Copyright Office, the United States Patent and Trademark Office, or elsewhere. If
requested, Executive agrees to execute any and all copyright, patent, or trade secret assignments,
certificates, applications or documents requested by the Company, its successors and assigns
related to the Property. Executive’s grant of rights in this Agreement is irrevocable and without
right of rescission by Executive.
6.2 In furtherance of, and not in contravention, limitation and/or in place of, the provisions
of Section 6.1 above, Company hereby notifies Executive of California Labor Code Section
2870, which provides:
6.2.1 “(a) Any provision in an employment agreement which provides that an employee shall
assign, or offer to assign, any of his or her rights in an invention to his or her employer shall
not apply to an invention that the employee developed entirely on his or her own time without using
the employer’s equipment, supplies, facilities, or trade secret information except for those
inventions that either: (1) Relate at the time of conception or reduction to practice of the
invention to the employer’s business, or actual or demonstrably anticipated research or development
of the employer; or (2) Result from any work performed by the employee for the employer.
6.2.2 (b) To the extent a provision in an employment agreement purports to require an employee
to assign an invention otherwise excluded from being required to be assigned under subdivision (a),
the provision is against the public policy of this state and is unenforceable.”
6.3 Executive acknowledges that he has been notified by the Company of this law, and
understands that this Agreement does not apply to Property which is otherwise fully
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protected under the provisions of said Labor Code Section 2870. Therefore, Executive agrees
to promptly disclose in writing to the Company all Property, whether or not Executive personally
considers it patentable, which Executive alone, or with others, conceives or makes during his
employment with Company or as is otherwise required and set forth under this Section 6.2.
Company shall hold said information in strict confidence to determine the applicability of
California Labor Code Section 2870 to said Property and, to the extent said Section 2870 does not
apply, Executive hereby assigns and agrees to assign all his right, title and interest in and to
the Property which relates to business of the Company and Executive agrees not to disclose any of
such Property to others without the prior written express consent of Company. Executive agrees to
notify Company in writing prior to making any disclosure or performing any work during the term of
his employment with Company which may conflict with any proprietary rights or technical know-how
claimed by Executive as his property. In the event Executive fails to give Company notice of such
conflict, Executive agrees that Executive shall have no further right or claim with respect to any
such conflicting proprietary rights or technical know-how.
7. EQUITABLE REMEDIES. The parties hereto intend that the covenants contained in
Sections 5 and 6 shall be enforced to the fullest extent permissible under the laws
of the State of California. Executive acknowledges and agrees that his breach of any provision of
Sections 5 and 6 will result in irreparable harm and injury to the Company, and
further acknowledges and agrees that in the event of any such breach it would be extremely
difficult to fix or assess actual damages resulting therefrom. In addition to any other remedy
that may be available to the Company at law or in equity, the Company shall be entitled, from any
court of competent jurisdiction, to a decree of specific performance and to a temporary and
permanent injunction enjoining and restricting the breach, or a threatened breach, by Executive of
any such provision of this Agreement.
8. MISCELLANEOUS.
8.1 Entire Agreement. This Agreement constitutes the entire agreement between the
parties pertaining to the subject matter hereof and supersedes and preempts any prior
understandings, agreements or representations by or between the parties, written or oral, which may
have related in any manner to the subject matter hereof. No supplement, modification or amendment
of this Agreement shall be binding unless executed in writing by all the parties. The rule that a
contract is construed against the party drafting the contract is hereby waived, and shall have no
applicability in construing this Agreement or the terms hereof.
8.2 Counterparts. This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
8.3 Successors and Assigns. Except as provided herein, this Agreement shall be
binding on, and shall inure to the benefit of, the parties to it and their respective heirs, legal
representatives, and permitted successors and assigns.
8.4 Notices. All notices required under this Agreement shall be given in writing and
shall be served in person, by express mail, by certified mail, by overnight delivery, or by
facsimile. Delivery shall be deemed conclusively made (i) at the time of service, if personally
served, (ii) five days after deposit in the United States mail, properly addressed and postage
prepaid, if delivered by express mail or certified mail, (iii) upon confirmation of delivery by the
private overnight deliverer, if served by overnight delivery, and (iv) at the time of electronic
transmission (as confirmed in writing), provided a copy is mailed within 24 hours after such
transmission. Notices to the Company shall be delivered to the Company’s then-current
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principal offices, to the attention of the Chief Executive Officer. Notices to the Executive
shall be delivered to the address (or facsimile number, if any) provided to the Company by the
Executive as his principal residence, or such other address or facsimile number as Executive may
designate by written notice.
8.5 Governing Law. This Agreement shall be construed in accordance with and governed
by the laws of the State of California.
8.6 Venue. The parties hereto agree that all actions or proceedings arising directly
or indirectly from this Agreement shall be arbitrated or litigated by arbitrators or in courts
having a situs within Los Angeles, California and hereby consent to the jurisdiction of any local,
state or federal court in which such an action is commenced that is located in Los Angeles,
California, agree not to disturb such choice of forum, waive the personal service of any and all
process upon them, and consent that all such service of process may be made by certified or
registered mail, return receipt requested, addressed to the respective parties at the address set
forth herein.
8.7 Severability. If any provision of this Agreement, as applied to any party or to
any circumstance, shall be found by a court or arbitrator of competent jurisdiction to be void,
invalid or unenforceable, the same shall in no way affect any other provision of this Agreement,
the application of any such provision in any other circumstance, or the validity or enforceability
of this Agreement, and any provision which is found to be void, invalid or unenforceable shall be
curtailed and limited only to the extent necessary to bring such provision within the requirements
of the law.
8.8 Headings. Titles or captions contained herein are inserted as a matter of
convenience and for reference, and in no way, define, limit, extend or describe the scope of this
Agreement or any provision thereof. No provision in this Agreement is to be interpreted for or
against either party because that party or its legal representative drafted such provision.
8.9 Further Assurances. Each party agrees to execute and acknowledge such other
instruments as may be reasonably necessary to effect the transactions contemplated herein.
8.10 Remedies Cumulative. All remedies shall be cumulative and pursuit of any one
shall not waive any other.
8.11 Waiver. No waiver by any party at any time of any breach by any other party of,
or compliance with, any condition or provision of the Agreement to be performed by any other party
shall be deemed a waiver of any other provisions or conditions at the same time or at any prior or
subsequent time.
8.12 Application of Section 409A. To the extent applicable, it is intended that this
Agreement comply with the provisions of Section 409A of the Internal Revenue Code and the guidance
promulgated thereunder (“Section 409A”). This Agreement shall be administered in a manner
consistent with this intent, and any provision that would cause the Agreement to fail to satisfy
Section 409A shall have no force and effect until amended by the parties to comply with Section
409A (which amendment may be retroactive to the extent permitted by Section 409A). Consistent with
this intent and notwithstanding anything to the contrary in this Agreement, if Executive is a
“specified employee” (as defined under Section 409A and determined pursuant to procedures adopted
by the Company) as of the date of Executive’s “separation from service” (within the meaning of
Section 409A) and any payment or portion thereof that otherwise would
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become payable to Executive pursuant to Section 4 of this Agreement during the first six
months following Executive’s separation from service is determined by the Company to constitute a
“deferral of compensation” under Section 409A, such payment or portion thereof shall be paid (a) to
the Executive by the Company in cash and in full, as soon as practicable after the first day of the
seventh month following such separation from service or (b) if Executive dies before such payment
or portion of thereof has been paid, such unpaid amounts shall be paid as soon as practicable
following Executive’s death to the personal representative of Executive’s estate. Thereafter, any
remaining payments shall resume in accordance with this Agreement Within five (5) days of
Executive’s request, the Company shall provide Executive with a written detailed explanation of the
Company’s analysis supporting its determination that Executive constitutes a “specified employee”
(as defined under Section 409A) and that any payment is covered by Section 409A.
8.13 Attorneys Fees. Should any litigation or arbitration occur between the parties
relating to this Agreement, the prevailing party shall be entitled to recover its reasonable
attorneys’ fees and other costs in connection with such litigation, including reasonable attorneys’
fees incurred after a judgment has been rendered by a court of competent jurisdiction, provided
that such recovery of fees and costs shall not exceed $150,000 regardless of whether actual fees
and costs exceed such amount. Any judgment shall include an attorneys’ fees clause that shall
entitle the judgment creditor to recover attorneys’ fees incurred to enforce a judgment on this
Agreement, which attorneys’ fees shall be an element of post-judgment costs.
IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement to be effective
as of the date first set forth above.
| EXECUTIVE |
||||
| /s/ Xxxx Xxxxxx | ||||
| Xxxx Xxxxxx | ||||
| OSI SYSTEMS, INC. |
||||
| /s/ Xxxxxx Xxxxxx | ||||
| By: Xxxxxx Xxxxxx, CEO | ||||
10
