Exhibit 10.21
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EMPLOYMENT AGREEMENT
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This Employment Agreement (the "Agreement") is entered into by and between
CARDIMA, INC. (the "Company") and XXXXXXX X. XXXX ("Xxxx").
1. Term of the Agreement. The Company hereby employs Xxxx and Xxxx hereby
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accepts employment with the Company in an "at-will" employment relationship
subject to the termination provisions set forth in paragraph 6 hereof.
2. Duties and Obligations.
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x. Xxxx shall be a member of the Board of Directors of the Company
pursuant to the terms specified herein and shall be considered a founder of the
Company.
x. Xxxx'x duties while employed by the Company shall initially be as
Executive Vice President and Chief Operating Officer of the Company. In such
position, Xxxx shall initially have responsibility for all operations of the
Company, including product development and sales and marketing, and at all times
report to and follow the instructions of the Board of Directors of the Company.
It is understood and agreed that the Company intends to hire a Chief Executive
Officer as determined in the discretion of the Board of Directors. After the
hiring of a Chief Executive Officer, Xxxx shall have such title and bear such
responsibilities as shall be assigned by the Board of Directors; provided,
however, that if (i) such position is not considered an officer of the Company
and (ii) Xxxx shall not have responsibility for, at a minimum, specified and
substantial product development and operational activities, then Xxxx may treat
such assignment as a termination of employment for purposes of Section 6 of this
Agreement.
x. Xxxx agrees that to the best of his ability and experience he will at
all times loyally and conscientiously perform all of the duties and obligations
required of and from him pursuant to the express and implicit terms hereof, and
to the reasonable satisfaction of the Company.
x. Xxxx will execute the Company's Proprietary Information and Inventions
Agreement upon his acceptance of employment with the Company.
3. Equity Interest in the Company. In consideration of his agreement with
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the Company, Xx. Xxxx shall, concurrent with the execution of this Agreement,
enter into a Restricted Stock Purchase
Agreement (the "Stock Agreement"), pursuant to which he shall be issued 466,667
shares of Common Stock of the Company (the "Shares") for a purchase price of
$.01 per share. Under the terms of the Stock Agreement, the Shares shall vest
according to the following schedule: (i) 25% immediately and (ii) the remaining
75% over three years ratably on a monthly basis.
4. Devotion of Entire Business Time to the Company's Business.
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a. During the term of his employment, Xxxx shall devote all of his
business time and attention to the business of the Company and the Company shall
be entitled to all of the benefits and profits arising from or incident to all
such work, services, and advice of Xxxx.
b. During the term of this Agreement, Xxxx shall not, whether directly or
indirectly, render any services of a commercial or professional nature to any
person or organization, whether for compensation or otherwise, without the prior
written consent of the Board of Directors of the Company; provided, however,
that it is agreed and acknowledged that Xxxx is a stockholder and member of the
Board of Directors of Armus Corporation, Inc. ("Armus"), a company engaged in
the development, marketing and sale of software to automate the detection of
cardiac arrhythmias. If requested by the Board of the Company, after
declaration that the business of Armus represents a corporate opportunity of the
Company, then Xxxx shall resign his position as a member of the Board of
Directors of Armus.
c. During the term of his employment, Xxxx shall not, directly or
indirectly, either as an employee, employer, consultant, agent, principal,
partner, stockholder, (other than in Target Therapeutics, Inc.), corporate
officer, director, or in any other individual or representative capacity, engage
or participate in any business that is competitive in any manner whatsoever with
the business of the Company; provided, however, that it is agreed and
acknowledged that this representation is subject to the same limitation as b.
above.
5. Compensation and Benefits.
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a. The Company shall pay to Xxxx a monthly salary of Eleven Thousand Two
Hundred Fifty Dollars ($11,250.00), less all applicable withholdings, prorated
for any partial employment period and payable in accordance with the Company's
payroll schedule. In addition, Xxxx shall (a) be paid a bonus equal to 11.1% of
the amount paid to him during the current fiscal year, less applicable
deductions, as soon as practicable after the end of such fiscal year, and (b) be
eligible to receive an additional bonus, at the
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discretion of the Board of Directors of the Company, of up to 11.1% of the
amount paid to him during the current fiscal year, less applicable deductions.
After such fiscal year, any adjustments in the monthly salary and any and all
bonuses shall be determined by the Board of Directors or an appropriate
committee thereof.
x. Xxxx shall be eligible to receive all employee benefits provided to
other Company employees pursuant to the Company's policy regarding said
benefits, including health insurance coverage.
6. Termination of Employment.
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a. This Agreement is terminable at any time for any reason, with or
without cause, by either party hereto. In the event that (i) Xxxx'x employment
is involuntarily terminated by the Company other than for "good cause" or (ii)
Xxxx voluntarily terminates his employment with the Company directly as a result
of the last sentence of Section 2b. of this Agreement, then in either such case,
Xxxx shall immediately resign from all positions with the Company, including as
a member of the Board of Directors, and enter into a consulting arrangement for
six months commencing immediately after his termination date during which he
shall not compete with the Company. In consideration for such consulting
arrangement, he shall continue to be paid his salary and benefits for six
months; provided, however, if he shall obtain new employment during such six
months, any salary paid pursuant to such arrangement shall be offset from
amounts due under this Agreement. For purposes of this Agreement, "good cause"
shall mean any of the following: gross misconduct or acts or omission that
involve fraud, embezzlement or misappropriation of any property or proprietary
information of the Company.
b. In the event that Xxxx dies or is mentally or physically disabled for
one hundred twenty (120) consecutive days or for 150 days within any 365 day
period, he shall be considered to have terminated his employment and continue to
be paid his salary and benefits for one year. As used in this paragraph 6b.,
"disabled" means the inability of Xxxx to diligently and expeditiously perform
his duties and obligations under this Agreement.
c. If the events described in Section 6a. occur or the events described in
6b. occur otherwise than while Xxxx is performing his duties, Xxxx shall become
vested over the following six months in the lesser of (i) an additional six
months of shares covered by the Stock Agreement or (ii) the remaining unvested
shares pursuant to the Stock Agreement. If the events described in 6b. above
occur while Xxxx is performing his duties, he shall
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immediately become vested in all remaining shares covered by the Stock
Agreement.
d. In the event that Xxxx'x employment is involuntarily terminated by the
Company for "good cause," Xxxx shall immediately resign from all positions with
the Company, including as a member of the Board of Directors and the Company's
obligations hereunder shall immediately terminate.
7. Miscellaneous.
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a. Effective Date. This Agreement shall become effective as of the date
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last written below.
b. Governing Law. This agreement shall be interpreted, construed,
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governed and enforced according to the laws of the State of California. If any
provision of this Agreement is determined by a court of law to be illegal or
unenforceable, then such provision will be enforced to the maximum extent
possible and the other provisions will remain in full force and effect.
c. Arbitration. Any dispute between the parties hereto involving the
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construction or application of any terms or conditions of this Agreement, or any
claims arising out of or relating to this Agreement, or the breach thereof, or
any claims arising out of the Xxxx'x employment with the Company or the
termination thereof (including but not limited to any claim of violation of
statutory right) will be submitted to and settled by final and binding
arbitration in Palo Alto, California, in accordance with the rules of the
American Arbitration Association then in effect, and judgment upon the award
rendered by the arbitrator may be entered in any court having jurisdiction
thereof.
d. Successors and Assigns. The rights and obligations of the Company
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under this Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of the Company. Xxxx shall not be entitled to assign any
of his rights or obligations under this Agreement.
e. Entire Agreement. This Agreement together with the Stock Agreement and
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the Proprietary Information and Inventions Agreement constitute the entire
agreement between the parties with respect to the employment of Xxxx. This
Agreement can be amended or modified only in a writing signed by the Xxxx and an
authorized representative of the Company.
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Dated: May 21, 1993 /s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
CARDIMA, INCORPORATED
Dated: May 16, 1993 By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx, Chairman of the Board
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