Exhibit 10.5
AMENDMENT TO EMPLOYMENT AGREEMENT
This Amendment to Employment Agreement (this "Amendment"), dated as of
the 2 day of April 2009, is made by and between Ivivi Technologies, Inc. (the
"Employer") and Xxxxxx X. Xxxxxxxxxx (the "Employee").
WITNESSETH THAT:
WHEREAS, the Employer and the Employee are parties to an Employment
Agreement, dated as of December 31, 2008 (the "Agreement"); and
WHEREAS, the Employer has determined to enter into certain financing
transactions (the "Transaction") pursuant to that certain Loan Agreement, dated
as of the date hereof, by and between the Employer and Emigrant Capital Corp.
(the "Loan Agreement"); and
WHEREAS, Emigrant Capital Corp. has required, as a condition to its
execution of the Loan Agreement and the closing of the Transaction, that the
Employee agree to certain amendments to the Agreement that may reduce the amount
of severance pay and benefits that may otherwise be paid or provided and/or
delay or defer the date upon which such severance pay and benefits may otherwise
be paid or provided (the "Severance Delay"); and
WHEREAS, the Employer and the Employee have determined that the
execution of the Loan Agreement, the execution of this Amendment, and the
consummation of the Transaction are necessary in order for the Employer to
remain a viable going concern; and
WHEREAS, the Employer and the Employee have determined that, in light
of the current financial position of the Employer, neither the execution of this
Amendment, nor the occurrence of the Severance Delay, should cause any payments
or benefits paid or provided under the Agreement to become subject to any
"additional tax" within the meaning of Section 409A of the Internal Revenue Code
of 1986, as amended.
NOW THEREFORE, for and in consideration of the foregoing, the Employer
and the Employee hereby agree as follows:
1. The Agreement is hereby amended to provide as follows:
(i) Notwithstanding any other provision of the Agreement to the
contrary, in the event that, at any time during the Severance Rights
Restriction Period (as defined in Annex 2 of the Loan Agreement) but
prior to the occurrence of the Maturity Date (as defined in Annex 2 of
the Loan Agreement), the employment of the Employee is terminated by
the Employer without Cause or by the Employee for Good Reason (a
"PRE-MATURITY APPLICABLE TERMINATION") and, as a result of such
Pre-Maturity Applicable Termination, the Employee would otherwise
become entitled to receive, pursuant to the terms of the Agreement, any
1
severance or other payment in the form of cash (but excluding the
payment of the Accrued Obligations, reimbursements relating to COBRA
coverage, and the acceleration of vesting of equity-based awards)
following, or in connection with, such Pre-Maturity Applicable
Termination (collectively, a "SEVERANCE PAYMENT"), the Employer's
obligation to make such Severance Payment, and the Employee's right to
receive such Severance Payment, shall be limited solely to the
obligation to pay severance in the form of continuation of Base Salary
for a period commencing on the effective date of such Pre-Maturity
Applicable Termination and ending on the Maturity Date (the
"PRE-MATURITY SEVERANCE"), and the Employer's obligation to make, and
the Employee's right to receive, any such Severance Payment in excess
of such Pre-Maturity Severance shall commence to be paid (as one or
more separate payments as provided for in the Agreement) on the date
that is the later of (i) the date such an applicable payment would
otherwise have been made pursuant to the terms of the Agreement and
(ii) the date that is immediately following the expiration of the
Severance Rights Restriction Period.
(ii) For the purpose of greater clarity, the Severance Payments that
are subject to the provisions of this Section 1 shall include, without
limitation, the payments described in Sections 4.02(C)(ii),
4.02(D)(ii)(1) and 4.02(E) of the Agreement.
(iii) Notwithstanding any other provision of the Agreement to the
contrary, in the event that, at any time during the Severance Rights
Restriction Period, the employment of the Employee is terminated (other
than pursuant to a Pre-Maturity Applicable Termination, which shall be
governed by clause (i) above) and, as a result of such termination, the
Employee would otherwise become entitled to receive, pursuant to the
terms of the Agreement, a Severance Payment following, or in connection
with, such termination, the Employer's obligation to make such
Severance Payment, and the Employee's right to receive such Severance
Payment, shall be limited solely to the obligation to pay severance in
the form of continued Base Salary for a period of 60 days immediately
following such termination of employment (the "60 DAY SEVERANCE"), and
the Company's obligation to make, and the Employee's right to receive,
any such Severance Payment in excess of such 60 Day Severance shall
commence to be paid (as one or more separate payments as provided for
in the Agreement) on the date that is the later of (i) the date such an
applicable payment would otherwise have been made pursuant to the terms
of the Agreement and (ii) the date that is immediately following the
expiration of the Severance Rights Restriction Period.
(iv) Notwithstanding any other provision of the Agreement or this
Amendment to the contrary, upon the occurrence of a Severance Rights
Termination Event (as defined in Annex 2 of the Loan Agreement), any
and all rights of the Employee to receive, and all obligations of the
Employer to pay, any Severance Payment (other than the Pre-Maturity
Severance or 60 Day Severance, as applicable) pursuant to the terms of
the Agreement, including any Severance Payment that was previously
delayed pursuant to clause (i) or (iii) above and any future Severance
Payment (other than the Pre-Maturity Severance or 60 Day Severance, as
applicable) that the Employee may in the future be entitled to receive,
shall terminate and cease to be of effect.
(v) Nothing contained in this Amendment shall relieve the Employee of
the requirement of executing the Release as a condition to the receipt
of any payment under the Agreement.
2. This Amendment may be executed in counterparts, each of which shall
constitute an original, but both of which together shall constitute one and same
instrument. This Amendment shall be governed by, and construed and interpreted
in accordance with, the laws of the State of New Jersey, without giving effect
to its principles of conflicts of laws. Except as specifically amended hereby,
the Agreement remains otherwise unmodified and in full force and effect, and is
hereby ratified by Employer and Employee.
IN WITNESS WHEREOF, the parties have signed this Amendment to Agreement
as of the day and year set forth above.
IVIVI TECHNOLOGIES, INC.
By: /s/ Xxxxxx Xxxxxx
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Title: SVP & CAO
Date: April 3, 2009
/s/ XXXXXX X. XXXXXXXXXX
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XXXXXX X. XXXXXXXXXX
