Exhibit 10.16
HEARTWARE LIMITED
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
EXECUTIVE SERVICE
AGREEMENT
.
.
.
CONTENTS
1 INTERPRETATION 1
1.1 Definitions 1
1.2 Interpretation 3
1.3 Headings 4
2 EMPLOYMENT OF EXECUTIVE 4
2.1 Appointment 4
2.2 Term 4
2.3 Continuous employment 5
2.4 Warranty 5
3 LOCATION 5
3.1 Place of employment 5
3.2 Travel 5
4 HOURS OF WORK 5
5 DUTIES 5
5.1 General Duties 5
5.2 Specific Duties 6
5.3 Corporate Offices 6
5.4 Other employment 7
6 REMUNERATION 7
6.1 Remuneration package 7
6.2 Cash salary payments 8
6.3 Remuneration Package review 8
6.4 Additional benefits 8
7 EXPENSES 9
8 RELOCATION 10
8.1 Relocation costs on commencement 10
8.2 Relocation costs on termination 10
9 ANNUAL LEAVE 10
9.1 Entitlement to annual leave 10
9.2 Taking annual leave 10
10 SICK LEAVE 10
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11 LONG SERVICE LEAVE 11
12 INTELLECTUAL PROPERTY 11
13 CONFIDENTIAL INFORMATION 11
13.1 Duty of confidentiality 11
13.2 Use of Confidential Information 12
13.3 Security of Confidential Information 12
13.4 Uncertainty 12
14 TERMINATION 12
14.1 Termination at the end of the Initial Term or Extended Term 12
14.2 Termination by the Executive on notice 12
14.3 Termination by the Company on notice 13
14.4 Termination by the Company for Cause 13
14.5 Payment in lieu of notice 14
14.6 Garden leave 14
14.7 Termination benefit 15
14.8 Acceleration of Options 16
14.9 Disciplinary and grievance procedures 16
14.10 Payment of accrued entitlements upon termination 16
14.11 No compensation 16
14.12 Right of set-off 17
15 NON-COMPETITION 17
15.1 Non-compete 17
15.2 Construction of Non-compete clause 18
15.3 Severability 18
15.4 Executive may hold shares 18
16 ACKNOWLEDGMENT 19
16.2 Relief 19
17 RETURN OF PROPERTY 19
17.1 Return of property 19
17.2 Destruction of property 20
18 SEVERANCE 20
19 NOTICES 20
19.1 General 20
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19.2 How to give a communication 20
19.3 Particulars for delivery of notices 20
19.4 Communications by post 21
19.5 Communications by fax 21
19.6 After hours communications 21
19.7 Process service 22
20 MISCELLANEOUS 22
20.1 Governing law 22
20.2 Assignment 22
20.3 No waiver 22
20.4 Amendment 22
20.5 Entire understanding 22
SCHEDULE 1 25
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DATE 15 DECEMBER 2004
PARTIES
HEARTWARE Limited ACN 111 970 256 of ▇▇▇▇▇ ▇, ▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ (COMPANY)
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ of ▇▇▇▇ Farm Barn, Town Street, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (EXECUTIVE)
BACKGROUND
A The Company wishes to appoint the Executive to the position of Chief
Executive Officer, and the Executive has agreed to accept appointment as
Chief Executive Officer on the terms and conditions set out in this
document.
AGREED TERMS
1 INTERPRETATION
1.1 DEFINITIONS
In this document:
BOARD means the board of directors of the Company.
BUSINESS means any corporation, partnership, joint venture, undertaking,
trust or enterprise.
BUSINESS DAY means a day other than a Saturday, Sunday or bank or public
holiday in New South Wales.
CASH SALARY means the amount of the Executive's Remuneration Package as
defined in CLAUSE 6.1 that he elects to receive by way of cash payment.
COMMENCEMENT DATE means the date upon which the Company is admitted to the
Official List of the Australian Stock Exchange Limited.
CONFIDENTIAL INFORMATION means any information, however communicated or
recorded, relating to the business of the Company or any Group Company to
which the Executive gains access, whether before, during or after the
Executive's employment with the Company, and includes:
(a) any trade secret or other commercially sensitive or confidential
information of or possessed by the Company or any Group Company, or
any person or entity with which the Company or any Group Company deals
or is concerned;
(b) any techniques, methods, computer software, materials, documents or
manuals of the Company or any Group Company used in their businesses;
(c) information concerning products developed or used by the Company or
any Group Company, their customers and suppliers;
(d) inventions, improvements or products discovered or developed by any
employee, officer, contractor or consultant of the Company or any
Group Company;
(e) information relating to the business affairs, accounts, business
plans, market research, marketing plans, sales plans, customer lists,
prospects, management or finances of the Company or any Group Company,
or any person or entity with which the Company or any Group Company
deals or is concerned;
(f) the identity of the customers, suppliers, consultants, distributors,
agents, contractors and employees of the Company or any Group Company
and the arrangements between any of these persons or entities;
(g) any information of or possessed by the Company or any Group Company
which is marked as confidential, is by its nature confidential, or the
Executive knows or ought to know is confidential; and
(h) the terms of this document,
but excludes any information which, without breach of this document or
other breach of confidence by the Executive, is or becomes public
knowledge.
EMPLOYEE SHARE OPTION PLAN means the Company's employee share option plan
as varied by the Company from time to time.
EMPLOYMENT means the employment of the Executive under this document.
EXTENDED TERM means the employment of the Executive under this Agreement
for any period after the Initial Term.
GROUP means the Company and the Group Companies.
GROUP COMPANY means a body corporate which is related to the Company within
the meaning of section 50 of the Corporations ▇▇▇ ▇▇▇▇ and any associated
company, including but not limited to HeartWare Inc.
INITIAL TERM means the period of two years commencing on the Commencement
Date.
INTELLECTUAL PROPERTY includes, but is not limited to, ideas, designs,
patents, trade marks, copyright (including moral rights) and designs
whether registered or unregistered, software developments, computer
programs, security codes, circuit layout rights and know-how, inventions
and improvements in procedures made or discoveries conceived.
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MATERIAL ADVERSE CHANGE means a downgrading or diminution of the
Executive's position, functions, status or authority within the Company
that is so substantial in effect as to deprive the Executive of the role,
functions, status and authority customarily expected of a Chief Executive
Officer, excluding any downgrading or diminution arising:
(i) through the termination of employment pursuant to this Agreement;
or
(ii) with the consent of the Executive.
RELEVANT PERIOD means the period of 12 months immediately preceding the
date on which the Employment terminates.
1.2 INTERPRETATION
Unless expressed to the contrary, in this document:
(a) words in the singular include the plural and vice versa;
(b) any gender includes the other genders;
(c) if a word or phrase is defined, its other grammatical forms have
corresponding meanings;
(d) "includes" means includes without limitation;
(e) a reference to:
(i) a person includes a partnership, joint venture, unincorporated
association, corporation and a government or statutory body or
authority;
(ii) a person includes its legal personal representatives, successors
and assigns;
(iii) any legislation includes subordinate legislation under it and
includes that legislation and subordinate legislation as modified
or replaced;
(iv) an obligation includes a warranty or representation and a
reference to a failure to comply with an obligation includes a
breach of warranty or representation;
(v) a right includes a benefit, remedy, discretion and power;
(vi) "$" or "dollars" is a reference to the lawful currency of
Australia;
(vii) writing includes any mode of representing or reproducing words
in tangible and permanently visible form, and includes facsimile
transmission;
(viii) this document includes all schedules and annexures to it; and
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(ix) a policy of the Company means any policy of the Company in
relation to the relevant subject matter as created, varied or
replaced from time to time.
1.3 HEADINGS
Headings do not affect the interpretation of this document.
2 EMPLOYMENT OF EXECUTIVE
2.1 APPOINTMENT
The Company will employ the Executive and the Executive will serve the
Company as Chief Executive Officer and as President and Chief Executive
Officer of HeartWare, Inc.
2.2 TERM
(A) INITIAL TERM
The Employment will commence on the Commencement Date and will
continue until the second anniversary of the Commencement Date unless
terminated earlier in accordance with this document.
(B) EXTENDED TERM
(ii) After the Initial Term, the Employment will be automatically
extended for additional terms of 12 months' duration unless
either Party gives notice in accordance with CLAUSE 14.1. On each
occasion that the Employment is extended in accordance with this
CLAUSE 2.2(B) the Employment will continue for a period of 12
months unless terminated earlier in accordance with this
document.
(iii) Unless otherwise agreed, the Executive's employment during any
Extended Term will continue on the terms and conditions set out
in this document.
2.3 CONTINUOUS EMPLOYMENT
For the purposes of calculating the Executive's continuous service with the
Company, the Executive's employment is deemed to have commenced on 1
December 2004.
2.4 WARRANTY
The Executive represents and warrants to the Company that he has the legal
right to enter into this Agreement and in performing his duties and
obligations under this document, he will not be in breach of any obligation
to a third party, including any restrictive covenant or confidentiality
obligation.
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3 LOCATION
3.1 PLACE OF EMPLOYMENT
The Employment will be based at the Company's premises in Sydney or such
other place or places as the Company may reasonably direct.
3.2 TRAVEL
The Executive may be required to travel extensively within and outside
Australia in the performance of the Executive's duties. The Executive will
not be entitled to any additional remuneration for such travel but the
expenses of such travel, including accommodation and meals, will be paid
for by the Company in accordance with its policies.
4 HOURS OF WORK
The Executive will work during the normal business hours of the Company and
such other hours as are necessary for the Executive to perform the
Executive's duties in a satisfactory manner. The Executive will not be
entitled to any additional remuneration for work outside normal business
hours.
5 DUTIES
5.1 GENERAL DUTIES
The Executive will:
(a) perform the duties assigned to the Executive from time to time and
comply with all lawful and reasonable directions given to the
Executive by the Board and any person duly authorised by the Board;
(b) subject to any written consent given by the Board under CLAUSE 5.4(B)
and except in the case of absence by reason of illness or incapacity
or while on leave in accordance with this document, devote the whole
of the Executive's time, attention and abilities during normal
business hours and such other hours as are necessary for the Executive
to perform the Executive's duties in a satisfactory manner,
exclusively to the business of the Company and the Group Companies;
(c) use the Executive's best endeavours to promote and enhance the
interests, welfare, business, profitability, growth and reputation of
the Company and the Group Companies;
(d) act in the best interests of the Group and not intentionally do
anything which is or may be harmful to the Company or any Group
Company;
(e) perform the Executive's duties and responsibilities in a proper and
efficient manner;
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(f) subject to the terms of this document, comply with the Company's
policies as varied from time to time;
(g) promptly report to the Board or such person as the Board may from time
to time determine, all information and explanations as it may require
in connection with matters relating to the Employment or the business
of the Company or any Group Company;
(h) not act, or be seen to be acting, in conflict with the best interests
of the Company or any Group Company.
5.2 SPECIFIC DUTIES
Without limiting the generality of CLAUSE 5.1, the Board may assign
specific duties to the Executive and may alter the Executive's duties from
time to time after discussion with the Executive.
5.3 CORPORATE OFFICES
The Executive agrees:
(a) upon request by the Board, to accept appointment to and to serve in
any other office or offices as director, secretary, public officer or
otherwise of the Company or any Group Company without additional
compensation or reward; and
(b) upon request by the Board and unless otherwise agreed by the Board, to
resign, on termination of the Employment, from any office or offices
held at that time.
5.4 OTHER EMPLOYMENT
(a) Subject to CLAUSE 5.4(B), the Executive will not, during the
Employment:
(i) carry on, advise, provide services to or be engaged, concerned or
interested in or associated with any business or activity which
is in competition with any business carried on by the Company or
any Group Company; or
(ii) without the prior written consent of the Company, be engaged or
interested in any other public or private work or duties, either
directly or indirectly, in any capacity (including as principal,
agent, partner, employee, shareholder, unitholder, joint
venturer, director, trustee, beneficiary, manager, consultant or
advisor),
(b) The Executive may:
(i) hold or acquire shares (whether directly or through nominees) in
aggregate not more than 5% of the issued ordinary shares in the
capital of any body corporate listed on a recognised stock
exchange;
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(ii) hold or acquire shares (whether directly or through nominees) in
aggregate more than 5% of the issued ordinary shares in the
capital of any body corporate listed on a recognised stock
exchange with the prior written consent of the Company;
(iii) manage his private investments;
(iv) participate in charitable, civic, educational, professional or
community affairs or serve on the board of directors or advisory
committees of non-profit entities; or
(v) undertake work for Jarvik Heart Inc (JARVIK) for a short period
after the Commencement Date to assist Jarvik to obtain CE ▇▇▇▇
approval for the Jarvik 2000 until such approval is obtained and
to act as Jarvik's European Authorised Representative until such
time as Jarvik appoints a new European Authorised Representative
provided that such activities do not interfere with the
Executive's capacity to discharge his duties pursuant to CLAUSES
5.1, 5.2 and 5.3 of this Agreement.
6 REMUNERATION
6.1 REMUNERATION PACKAGE
The Company will provide the Executive with the remuneration package
(REMUNERATION PACKAGE) specified in SCHEDULE 1 or such other rate as may be
determined from time to time on review under CLAUSE 6.3.
The Remuneration Package will comprise Cash Salary, superannuation
contributions made by the Company to a complying fund on the Executive's
behalf and other non-salary benefits as set out in SCHEDULE 1 or as
otherwise agreed from time to time, provided that the superannuation
component shall be at least the minimum amount required in accordance with
the Superannuation Guarantee Administration ▇▇▇ ▇▇▇▇. The Executive will be
required to meet the costs of any fringe benefits tax or other tax payable
by the Company in consequence of the provision of the Remuneration Package
(including goods and services tax but excluding any pay-roll tax and tax on
the corporate profits of the Company).
6.2 CASH SALARY PAYMENTS
The Executive's Cash Salary will be paid monthly by electronic deposit into
an account nominated by the Executive.
6.3 REMUNERATION PACKAGE REVIEW
The Remuneration Package will be reviewed by the Board each year, on such
basis as the Board in its absolute discretion may determine having regard
to the performance of the Executive and the circumstances of the Company.
The Remuneration will not be reduced without the consent of the Executive
unless the Board decides to reduce the remuneration
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of all senior executives of the Group, in which case the Executive's
Remuneration Package will be reduced by the same percentage as the
percentage reduction applied to the remuneration of other senior executives
within the Group.
6.4 ADDITIONAL BENEFITS
(A) BONUS SCHEME
(i) In addition to the Remuneration Package, the Executive is
eligible to participate in the Company's performance-based bonus
scheme.
(ii) The amount of the bonus payable to the Executive (if any) will be
determined by the Board in its absolute discretion having regard
to the performance of the Company and the Executive against key
performance indicators as determined by the Board in consultation
with the Executive. It is expected that the performance reviews
will be conducted annually by the Executive and the Board.
(B) EMPLOYEE SHARE OPTION PLAN
(i) The Executive will be entitled to be granted options under the
Company's Employee Share Option Plan (OPTIONS) equal to 3% of the
issued capital of the Company on Listing. The number, exercise
price and vesting of the Options will be as follows:
% of Options Exercise Price Vesting Date
------------ -------------- ------------
25% AUDS0.60 First Anniversary of Commencement Date
25% AUDS0.75 Second Anniversary of Commencement Date
25% AUDS1.00 Third Anniversary of Commencement Date
25% AUD$1.50 Fourth Anniversary of Commencement Date
(ii) Except as provided for in CLAUSE 14.8, the Executive's right to
exercise the options granted pursuant to CLAUSE 6.4(B)(I) is
subject to the Executive's continued employment with the Company
on the relevant vesting date and the terms of the Employee Share
Option Plan.
(iii) Should there be a significant dilutionary event affecting the
Company, the Board will, at its sole discretion, review the
Executive's share option entitlements having taken into account
factors such as the achievement of specific milestones and other
performance measures. The Board will also take into account the
overall level of the Company's Employee Share Option Plan.
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(C) HOUSING ASSISTANCE
The Board has the option of providing the Executive with housing assistance
in recognition of the costs associated with relocation from the primary
residence in the UK. This assistance may take the form of a long term loan
at a reasonable rate of interest, payable within six month's of termination
or one year vesting of the Executive's fourth package of share options.
(D) OTHER BENEFITS
The Executive will be entitled to other benefits, such as participation In
group insurance schemes, in accordance with Company policies.
7 EXPENSES
The Company will reimburse the Executive for all reasonable expenses
properly incurred by the Executive in the performance of the Executive's
duties, subject to Company policies and provision of any documentary
evidence (including goods and services tax receipts) reasonably required by
the Company.
8 RELOCATION
8.1 RELOCATION COSTS ON COMMENCEMENT
The Company will reimburse the Executive for all reasonable expenses
incurred in the relocation of the Executive's family to Sydney, including
the removal of household items, two motor vehicles, airfares and costs
associated with the sale of the Executive's principal residence in the UK
(including broker's fees and taxes incurred in connection with the sale).
Such reimbursement will be up to a maximum amount of $50,000 and subject to
the provision of any documentary evidence (including goods and services tax
receipts) reasonably required by the Company. The Company will also pay for
three months rental in an appropriate apartment or house. The Company will
also cover one business class return airfare to the UK each year for the
Executive's spouse.
8.2 RELOCATION COSTS ON TERMINATION
If the Executive's employment is terminated by the Company pursuant to
CLAUSE 14.3 of this Agreement during the 12 months immediately following
the Commencement Date, the Company will reimburse the Executive for all
reasonable expenses incurred in the relocation of the Executive's family to
London, UK, including the removal of household items, two motor vehicles,
airfares and costs associated with the sale of the Executive's principal
residence in the UK (including broker's fees and taxes incurred in
connection with the sale). Such reimbursement will be up to a maximum
amount of $50,000 and subject to the provision of any documentary evidence
(including goods and services tax receipts) reasonably required by the
Company.
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9 ANNUAL LEAVE
9.1 ENTITLEMENT TO ANNUAL LEAVE
The Executive will be entitled to four weeks' paid annual leave for each
year of continuous service with the Company, accruing on a pro- rata basis.
9.2 TAKING ANNUAL LEAVE
Annual leave will be taken at times approved by the Board. If the Executive
accrues more than eight weeks of annual leave, the Board may direct the
Executive to take some or all of the Executive's accrued annual leave
entitlement upon eight weeks' written notice.
10 SICK LEAVE
The Executive is entitled to ten days' paid sick leave in each complete
year of service. Sick leave is cumulative, but no payment will be made in
respect of untaken sick leave on termination of the Employment. Additional
paid sick leave may be approved by the Board in its absolute discretion.
The Company may require a medical certificate for absences of more than
five days.
11 LONG SERVICE LEAVE
The Executive will be entitled to long service leave in accordance with the
Long Service Leave ▇▇▇ ▇▇▇▇ (NSW).
12 INTELLECTUAL PROPERTY
The Executive acknowledges and agrees that all Intellectual Property
developed, created or conceived by the Executive (whether alone or with
others) during the Employment and which is related to or may be adapted to
the business of the Company or any Group Company is and will be the sole
and exclusive property of the Company. The Executive further acknowledges
and agrees that:
(a) full right, title and interest in copyright works created by the
Executive will vest in the Company immediately on creation;
(b) full right, title and interest in all other Intellectual Property is
assigned to the Company by the Executive;
(c) the Executive will promptly execute all documents and do all things
necessary to vest or assign full right, title and interest in the
Intellectual Property in and to the Company; and
(d) the Executive irrevocably and unconditionally waives all moral rights
and any equivalent or analogous rights.
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13 CONFIDENTIAL INFORMATION
13.1 DUTY OF CONFIDENTIALITY
The Executive must keep confidential all Confidential Information and must
not, both during the Employment and after it ends, disclose or allow to be
disclosed any Confidential Information to any person except:
(a) if the Executive has been authorised in writing by the Board to do so;
(b) to the agents, employees or advisers of the Company or a Group Company
in the proper performance of the Executive's responsibilities and
duties;
(c) if the Executive is required by law to do so. In this case, no more
Confidential Information must be disclosed than is strictly required
and the Executive must take all reasonable steps to ensure the
disclosed Confidential Information is treated confidentially; or
(d) In respect of the terms of this document, in confidence to the
Executive's legal or financial advisers or members of the Executive's
immediate family.
13.2 USE OF CONFIDENTIAL INFORMATION
The Executive must not use any Confidential Information for the benefit of
any person other than the Company or a Group Company.
13.3 SECURITY OF CONFIDENTIAL INFORMATION
The Executive must maintain effective security measures to protect all
Confidential Information from unauthorised access, use, copying or
disclosure.
13.4 UNCERTAINTY
If there is any uncertainty as to whether any information is Confidential
Information, that information must be treated as Confidential Information
unless the Executive is advised by the Board in writing to the contrary.
14 TERMINATION
14.1 TERMINATION AT THE END OF THE INITIAL TERM OR EXTENDED TERM
Either Party may give written notice not less than three months prior to
the expiry of the Initial Term or any Extended Term indicating that they do
not wish to renew the Employment for a further term, and where such notice
is given the Employment shall be terminated at the end of the Term.
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14.2 TERMINATION BY THE EXECUTIVE ON NOTICE
(a) After the Initial Term, the Executive may terminate this Agreement
upon giving six months' written notice.
(b) The Executive may terminate this Agreement upon giving 30 days'
written notice that, in his opinion, acting reasonably and in good
faith, a Material Adverse Change has occurred. Such notice must set
out in reasonable details the grounds upon which he considers that
such a change has occurred. If during the notice period the Company
reverses the Material Adverse Change, any notice given under this
CLAUSE 14.2(B) will cease to have effect.
14.3 TERMINATION BY THE COMPANY ON NOTICE
The Company may at any time terminate the Employment by giving six months'
written notice to the Executive.
14.4 TERMINATION BY THE COMPANY FOR CAUSE
Without limiting the generality of CLAUSE 14.3, the Company may at any time
immediately terminate the Employment by giving written notice to the
Executive if the Executive:
(a) commits any act of serious misconduct;
(b) fails or refuses to comply with any lawful and reasonable direction
given by the Company;
(c) intentionally commits a serious or persistent breach of this document
which is detrimental to the Company or any Group Company and is
incapable of rectification;
(d) commits any serious or persistent breach of this document which
continues unremedied for 10 days after written notice of that breach
has been given to the Executive;
(e) commits any act (whether in the course of the Employment or not) which
in the reasonable opinion of the Board brings the Executive into
disrepute or may cause damage to the reputation of the Executive, the
Board, the Company or any Group Company or otherwise affect adversely
the interests of the Company or any Group Company;
(f) is convicted of any offence (whether in the course of the Employment
or not) involving fraud or dishonesty or any other serious offence
(except for a traffic offence) which is punishable by imprisonment
(whether the Executive is imprisoned or not);
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(g) is bankrupt, is declared bankrupt or enters into any composition or
arrangement with or makes any assignment of the Executive's property
in favour of the Executive's creditors generally;
(h) is precluded from taking part in the management of a corporation by
the provisions of the Corporations ▇▇▇ ▇▇▇▇;
(i) becomes of unsound mind or a person whose person or estate is liable
to be dealt with in any way under laws relating to mental health; or
(j) is incapacitated by physical or mental illness, accident or any other
circumstances beyond the Executive's control:
(A) for a period of 120 consecutive days or an aggregate period
of 120 days in any 12 month period, or
(B) for a period of less than 120 consecutive days or an
aggregate period of 120 days in any 12 month period where a
medical practitioner nominated by the Company and its
Insurers determines that the Executive is totally and
permanently incapacitated, and such determination is
accepted by the Executive or his legal representative, such
acceptance not being unreasonably withheld.
Where the Executive's employment is terminated pursuant to CLAUSE 14.4, the
Company must specify in reasonable detail in the notice of termination the
basis for such termination.
Where the Executive's employment is terminated pursuant to CLAUSE 14.4(J)
he will be paid six months' Remuneration.
14.5 PAYMENT IN LIEU OF NOTICE
The Company may substitute payment in lieu of any part or all of any period
of notice of termination. Such payment shall be calculated at the rate of
the Remuneration Package payable to the Executive immediately prior to the
termination of his employment.
14.6 GARDEN LEAVE
During:
(a) part or all of any period of notice of termination given by the
Executive or the Company; or
(b) any period not exceeding two weeks during which the Company is
investigating any disciplinary issue involving the Executive,
the Company may, at its sole discretion:
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(c) require the Executive to perform only such duties as the Company may
determine or not to perform any duties at all; and/or
(d) require the Executive not to have any contact with any employees,
customers or business associates of the Company or any Group Company
other than normal social contact; and/or
(e) exclude the Executive from all or any part of the Company's and any
Group Company's premises.
Provided that the Executive's remuneration will not be withheld or reduced
as a result of the Executive complying with such directions.
14.7 TERMINATION BENEFIT
(a) If the Executive's employment is terminated by the Executive pursuant
to CLAUSE 14.2(B) or by the Company pursuant to CLAUSE 14.3, the
Executive will be entitled to a Termination Benefit in accordance with
this CLAUSE 14.7.
(b) The Company will pay to the Executive a maximum amount equivalent to
the Executive's annual Remuneration Package payable to him immediately
prior to the termination of his employment, subject to deduction of
tax and any other statutory deductions, and subject to CLAUSES
14.7(C), 14.7(D) and 14.7(E).
(c) The Termination Benefit is payable by monthly instalments equivalent
to one-twelfth of the Executive's annual Remuneration Package and such
payments are conditional upon:
(i) the Executive executing and delivering to the Company a general
release and waiver (in a form reasonably satisfactory to the
Company) of all claims against the Company, its parent,
subsidiaries and their respective shareholders, officers and
directors (RELEASE);
(ii) the Executive's compliance with the terms and conditions set out
in this Agreement;
(iii) the Executive making all commercially reasonable efforts
following such termination to obtain a position at substantially
the level at which he had been operating at the Company prior to
the termination of his employment
(d) If at any time during the 12 month period commencing on the date upon
which notice of termination is given the Executive obtains a position
at substantially the level at which he had been operating at the
Company prior to the termination of his employment, he must notify the
Company of the commencement date of such employment and the Company
shall not be required to make any further payments under this CLAUSE
14.7 from the date such employment commences.
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(e) The amount of any Termination Benefit payable to the Executive shall
be offset by:
(i) any payment made to the Executive by the Company during any
period of notice of termination, including any payment made
during any period of Garden Leave;
(ii) any payment made to the Executive in lieu of notice of
termination of the Employment;
(iii) any amount earned pursuant to any employment, consulting or
other arrangements made directly or indirectly by the Executive
(including without limitation by The Bridge Medical, Ltd, or
other entity formed by or on behalf of the Executive or in which
he has a substantial interest) following the termination of the
Employment.
14.8 ACCELERATION OF OPTIONS
If the Executive's employment is terminated by the Executive pursuant to
CLAUSE 14.2(B) or by the Company pursuant to CLAUSE 14.3 the unvested share
options that the Executive holds shall, on the date of termination of the
Executive's employment, accelerate in respect of the immediately following
12 months of vesting, and become immediately exercisable, notwithstanding
any share option plan of the Company or any term of this document.
14.9 DISCIPLINARY AND GRIEVANCE PROCEDURES
In view of the seniority of the Executive's position, the Company is not
required to follow any performance review, disciplinary, warning or
grievance procedures before terminating the Employment.
14.10 PAYMENT OF ACCRUED ENTITLEMENTS UPON TERMINATION
On termination of the Employment, whether pursuant to this CLAUSE 14 or
otherwise, the Executive will be entitled to receive from the Company:
(a) Remuneration up to and including the date of termination;
(b) payment in lieu of any accrued annual leave to which the Executive is
entitled up to and including the date of termination, calculated at
the rate of the Remuneration Package payable to the Executive
immediately prior to termination;
(c) payment in lieu of any long service leave to which the Executive is
entitled up to and including the date of termination calculated at the
rate of the Remuneration Package payable to the Executive immediately
prior to termination.
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14.11 NO COMPENSATION
Upon termination of the Employment in accordance with the express terms of
this document, the Executive will not be entitled to claim any compensation
or damages from the Company in respect of that termination beyond those
specified in this document.
14.12 RIGHT OF SET-OFF
(a) Termination of the Employment under any circumstances will not
abrogate, impair, release, or extinguish any debt, obligation or
liability of the Executive to the Company which may have accrued under
this document or otherwise including any debt, obligation or liability
which was the cause of termination or arose out of that cause.
(b) On termination of the Employment, the Company may set-off any debt,
obligation or liability of the Executive to the Company against the
Executive's entitlements on termination.
15 NON-COMPETITION
15.1 NON-COMPETE
In the event that the Employment is terminated for whatever reason, the
Executive will not without the written consent of the Company directly or
indirectly whether on the Executive's own account or for any person:
(a) (i) perform any services of the type the Executive performed for the
Company or any Group Company under this document for any Business
engaged in whole or part in competition with any business of the
Company or any Group Company;
(ii) solicit or endeavour to solicit any director, manager, officer,
senior employee or contractor of the Company known personally to
the Executive or knowingly employ, assist in or procure the
employment by any Business of any such person;
(iii) solicit or endeavour to solicit any person who was during the
Executive's employment with the Company a customer or client of
the Company with a view to providing services to that customer or
client which are the same as or similar to the services which the
Executive was involved in providing to that customer or client
during the Relevant Period;
(iv) deal with or accept any approach from or work on any account of
any person who was during the Executive's employment with the
Company a customer or client of the Company with a view to
providing services to that customer or client which are the same
as or similar to the services which the Executive was involved in
providing to that customer or client during the Relevant Period;
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(b) for a period of:
(i) 12 months;
(ii) 9 months
(iii) 6 months;
(iv) 3 months;
(c) throughout:
(i) the world
(ii) Australia, Europe (including the United Kingdom), and the United
States
(iii) Australia and Europe (including the United Kingdom),
(iv) Australia
15.2 CONSTRUCTION OF NON-COMPETE CLAUSE
CLAUSE 15.1 will be construed and have effect as if it were the number of
separate sub-clauses which results from combining the commencement of
CLAUSE 15.1 with each sub-paragraph of paragraph (a) and combining each
such combination with each sub-paragraph of paragraph (b) and combining
each such combination with each sub-paragraph of paragraph (c), each such
resulting sub-clause being severable from each other such resulting
sub-clause and it is agreed that if any of the resulting sub-clauses shall
be invalid or unenforceable for any reason, such invalidity or
unenforceability will not prejudice or in any way affect the validity or
enforceability of any other such resulting sub-clause.
15.3 SEVERABILITY
The Executive agrees that if any of the above restraints or any part of
them is held to be invalid or unenforceable for any reason, that restraint
or part shall be severed so that the remainder shall remain valid and
effective.
15.4 EXECUTIVE MAY HOLD SHARES
This CLAUSE 15 shall not restrict the Executive from holding or acquiring
(either directly or indirectly) a passive interest in aggregate not more
than 3% of the issued ordinary shares in the capital of any Business which
is same as or substantially similar to or in competition with any part of
the business of the Company or any Group Company, or 5% of the issued
ordinary shares in the capital of any other body corporate listed on any
recognised stock exchange or from being employed in or engaged by any
Business which is same as or substantially similar to or in competition
with any part of the business of the
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Company or any Group Company in a position which is not concerned with the
management, strategic direction, marketing or sales functions of that
Business.
16 ACKNOWLEDGMENT
The Executive acknowledges and agrees that:
(a) the Company has spent and will spend effort and money in establishing
and maintaining its customer base, employee skills and the
Confidential Information;
(b) the only fair and reasonable manner in which the interests of Company
can be protected is by the restraints imposed on the Executive in this
Agreement;
(c) the Executive has received adequate consideration for the restraint
obligations imposed on the Executive in this Agreement; and
(d) the duration, extent and application of the respective restraints
contained in this Agreement are at the date of this Agreement (and as
the parties can at that date foresee) not greater than is reasonably
necessary for the protection of the interests of the Company given the
nature of the business and undertaking of the Company.
16.2 RELIEF
The Executive acknowledges that an order for damages would be an inadequate
remedy for any breach of CLAUSES 12, 13 or 15.1 and hereby consents and
agrees that in the event he commits any breach of any of these clauses:
(a) the Company will be entitled to immediate relief by way of injunction
without the necessity to prove any loss or damage; and
(b) the Company will be entitled to such permanent orders in restraint of
the Executive and to such orders for damages and to such other orders
as any Court of competent jurisdiction may think fit upon trial and
determination of the issues in dispute.
17 RETURN OF PROPERTY
17.1 RETURN OF PROPERTY
Upon termination of the Employment, or at any time upon request by the
Board, the Executive will immediately deliver to the Company all property
of any description belonging to the Company or any Group Company and all
documentation or other material on which is recorded any Confidential
Information, whether in physical or electronic form, which is in the
Executive's possession, custody or control which is physically capable of
delivery.
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17.2 DESTRUCTION OF PROPERTY
The Executive will, upon request by the Board, destroy any or all of the
above items or in relation to any Confidential Information contained in
computer software or data, destroy it by erasing it from the medium on
which it is stared so that the information cannot be recovered or
reconstructed, and certify in writing to the Board that such items or
Confidential Information have been destroyed or erased.
18 SEVERANCE
Any provision of this document which is or becomes illegal, void or
unenforceable in any jurisdiction will be ineffective and severable in that
jurisdiction to the extent of the illegality, voidness or unenforceability
and will not invalidate the remaining provisions of this document nor
affect the validity or enforceability of that provision in any other
jurisdiction.
19 NOTICES
19.1 GENERAL
A notice, demand, certification, process or other communication relating to
this document must be in writing in English and may be given by an agent of
the sender.
19.2 HOW TO GIVE A COMMUNICATION
In addition to any other lawful means, a communication may be given by
being:
(a) personally delivered;
(b) left at the party's current address for notices;
(c) sent to the party's current address for notices by pre-paid ordinary
mail or, if the address is outside Australia, by pre-paid airmail; or
(d) sent by fax to the party's current fax number for notices.
19.3 PARTICULARS FOR DELIVERY OF NOTICES
(a) The particulars for delivery of notices are initially:
COMPANY:
Address: as set out above
Fax: ▇▇▇ ▇▇▇▇ ▇▇▇▇
Attention: The Chairman
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EXECUTIVE:
Address: as set out above
Fax: ▇▇▇ ▇▇▇▇ ▇▇▇▇
(b) Each party may change its particulars for delivery of notices by
notice to each other party.
19.4 COMMUNICATIONS BY POST
Subject to clause 19.6, a communication is given if posted:
(a) within Australia to an Australian address, three Business Days after
posting; or
(b) in any other case, ten Business Days after posting.
19.5 COMMUNICATIONS BY FAX
(a) Subject to CLAUSE 19.6, a communication is given if sent by fax, when
the sender's fax machine produces a report that the fax was sent in
full to the addressee. That report is conclusive evidence that the
addressee received the fax in full at the time indicated on that
report.
(b) A party is not entitled to object to a fax being illegible unless the
party requests retransmission within four hours (being between 8.30 am
and 5.00 pm on a Business Day) of completion of the transmission. This
CLAUSE 19.5 applies to any retransmission.
19.6 AFTER HOURS COMMUNICATIONS
If a communication is given:
(a) after 5.00 pm in the place of receipt; or
(b) on a day which is not a Business Day in the place of receipt,
it is taken as having been given on the next Business Day.
19.7 PROCESS SERVICE
Any process or other document relating to litigation, administrative or
arbitrage proceedings relating to this document may be served by any method
contemplated by this clause 19 or in accordance with any applicable law.
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20 MISCELLANEOUS
20.1 GOVERNING LAW
This document is governed by and is to be construed in accordance with the
laws in force in New South Wales and the parties irrevocably and
unconditionally submit to the non-exclusive jurisdiction of the Courts of
New South Wales and any Courts which have jurisdiction to hear appeals from
any of those Courts.
20.2 ASSIGNMENT
Neither party will assign any of its rights under this document.
20.3 NO WAIVER
No failure to exercise or any delay in exercising any right, power or
remedy under this document will operate as a waiver. Nor will any single or
partial exercise of any right, power or remedy preclude any other or
further exercise of that or any other right, power or remedy.
20.4 AMENDMENT
This document may only be varied or replaced by a document duly executed by
the parties. No change to the duties, title, remuneration or
responsibilities of the Executive will amount to a variation or termination
of this document except to the extent agreed in writing between the
parties.
20.5 ENTIRE UNDERSTANDING
(a) This document embodies the entire understanding and agreement between
the parties as to the subject matter of this document.
(b) All previous negotiations, understandings, representations,
warranties, memoranda or commitments in relation to, or in any way
affecting, the subject matter of this document are merged in and
superseded by this document and will be of no force or effect whatever
and no party will be liable to any other party in respect of those
matters.
(c) No oral explanation or information provided by any party to another
will:
(i) affect the meaning or interpretation of this document; or
(ii) constitute any collateral agreement, warranty or understanding
between any of the parties.
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SCHEDULE 1
REMUNERATION PACKAGE
The Remuneration Package as at the date of this document is as follows:
(a) Salary inclusive of superannuation contributions AUD$470,000
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EXECUTED as an agreement
EXECUTED by HEARTWARE LIMITED )
)
/s/ ▇▇▇▇▇ ▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------- ----------------------------------------
Company Secretary/Director Director Director
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Name of Director (print) Name of Director (print)
SIGNED by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ in the )
presence of: )
/s/ ▇▇▇▇▇ ▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------------- ----------------------------------------
Witness
▇▇▇▇▇ ▇▇▇▇▇
Name of Witness (print)
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