Exhibit 10.13
HEARTWARE LIMITED
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
EXECUTIVE SERVICE
AGREEMENT
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CONTENTS
1 INTERPRETATION 4
1.1 Definitions 4
1.2 Interpretation 5
1.3 Headings 6
2 EMPLOYMENT OF EXECUTIVE 6
2.1 Term 6
2.2 Warranty 7
3 LOCATION 7
3.1 Place of employment 7
3.2 Travel 7
4 HOURS OF WORK 7
5 DUTIES 7
5.1 General Duties 7
5.2 Specific Duties 8
5.3 Other employment 8
6 REMUNERATION 9
6.1 Remuneration package 9
6.2 Cash salary payments 9
6.3 Remuneration Package review 9
6.4 Additional benefits 9
7 EXPENSES 11
8 ANNUAL LEAVE 11
8.1 Entitlement to annual leave 11
8.2 Taking annual leave 11
9 SICK LEAVE 11
10 LONG SERVICE LEAVE 11
11 INTELLECTUAL PROPERTY 11
12 CONFIDENTIAL INFORMATION 12
12.1 Duty of confidentiality 12
12.2 Use of Confidential Information 12
12.3 Security of Confidential Information 12
12.4 Uncertainty 12
13 TERMINATION 13
13.1 Termination by the Executive on notice 13
13.2 Termination by the Company on notice 13
13.3 Termination by the Company for Cause 13
13.4 Payment in lieu of notice 14
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13.5 Garden leave 14
13.6 Disciplinary and grievance procedures 15
13.7 Payment of accrued entitlements upon termination 15
13.8 No compensation 15
13.9 Right of set-off 15
14 NON-COMPETITION 16
14.1 Non-compete 16
14.2 Construction of Non-compete clause 17
14.3 Severability 17
14.4 Executive may hold shares 17
15 ACKNOWLEDGMENT 17
16 RETURN OF PROPERTY 18
16.1 Return of property 18
16.2 Destruction of property 18
17 SEVERANCE 18
18 NOTICES 18
18.1 General 18
18.2 How to give a communication 19
18.3 Particulars for delivery of notices 19
18.4 Communications by post 19
18.5 Communications by fax 19
18.6 After hours communications 20
18.7 Process service 20
19 MISCELLANEOUS 20
19.1 Governing law 20
19.2 Assignment 20
19.3 No waiver 20
19.4 Amendment 20
19.5 Entire understanding 21
SCHEDULE 1 22
SCHEDULE 2 24
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DATE 23RD MARCH 2005
PARTIES
HEARTWARE Limited ACN 111 970 256 of ▇▇▇▇▇ ▇, ▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ (COMPANY)
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ OF ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
(EXECUTIVE)
BACKGROUND
A The Company wishes to employ the Executive in the position of Director
Corporate Development, and the Executive has agreed to accept employment as
Corporate Development Executive 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 the Executive elects to receive by way of cash
payment.
COMMENCEMENT DATE means the date agreed by the Executive and the Company as
the date upon which the Executive commences employment with the Company.
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 from time to time.
EMPLOYMENT means the employment of the Executive under this document.
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.
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.
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;
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(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
(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 TERM
The Employment will commence on the Commencement Date and will continue
until terminated in accordance with CLAUSE 13 of this Agreement. There will
be a probationary period of three months from the Commencement Date during
which the Company can determine that the employee is not meeting the
requirements of the position and may Terminate the employee without
penalty.
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2.2 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.
3 LOCATION
3.1 PLACE OF EMPLOYMENT
The Employment will be based primarily at the Company's premises in Sydney
or such other place or places as the Company may reasonably direct.
3.2 TRAVEL
The Executive will be required to travel regularly to the Group's other
offices and may be required to undertake other travel within and outside
Australia in the performance of his 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 Company and any person duly authorised by the
Company;
(b) subject to any written consent given by the Company under CLAUSE
5.3(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 Group;
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(d) act in the best interests of the Group and not intentionally do
anything which is or may be harmful to the Group;
(e) perform the Executive's duties and responsibilities in a proper and
efficient manner;
(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 Company or such person as the Company 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 Group.
5.2 SPECIFIC DUTIES
Without limiting the generality of CLAUSE 5.1, the Executive's duties at
the commencement of the Employment will be as specified in SCHEDULE 1. The
Company may assign additional duties to the Executive and may alter the
Executive's duties from time to time after discussion with the Executive.
5.3 OTHER EMPLOYMENT
(a) Subject to CLAUSE 5.3(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;
(ii) manage his private investments; or
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(iii) participate in charitable, civic, educational, professional or
community affairs or serve on the board of directors or advisory
committees of non-profit entities,
provided that such activities do not interfere with the Executive's
capacity to discharge his duties pursuant to CLAUSES 5.1 and 5.2 of this
Agreement.
6 REMUNERATION
6.1 REMUNERATION PACKAGE
The Company will provide the Executive with the remuneration package
(REMUNERATION PACKAGE) specified in SCHEDULE 2 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 and superannuation
contributions made by the Company to a complying fund on the Executive's
behalf as set out in SCHEDULE 2 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 Package will not be reduced without the consent of the
Executive unless the Board decides to reduce the remuneration 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
In addition to the Remuneration Package, the Executive will be entitled to
a one-off cash bonus of $200,000 (inclusive of superannuation) on the
successful closing of the Company's next capital raising provided that:
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(i) the amount raised is not less than AUD$20 million, or if a lesser
target amount for the capital raising is set at the discretion of
the Board of Directors;
(ii) the date of closing is not later than 31 July 2006 (or such later
date as may, in the absolute discretion of the Company, be
nominated by the Company); and
(iii) the Executive is still an employee of the Company at the date of
closing.
Subsequent to this one-off performance based cash bonus, the HeartWare
Limited Management and Board of Directors will develop a bonus structure
which is related to the then current activities and responsibilities of the
Executive. This replacement structure will be discussed with the Executive
within three months of the closing of the next capital raising.
(B) EMPLOYEE SHARE OPTION PLAN
NOTE: THE GRANTING OF SHARE OPTIONS TO ANY INDIVIDUAL OR INDIVIDUALS, WHO
ARE NOT DIRECTORS, CAN ONLY BE AUTHORISED BY THE HEARTWARE LIMITED
BOARD OF DIRECTORS
(i) On signing this Agreement, the Executive will be entitled to be
granted 764,204options under the Company's Employee Share Option
Plan (OPTION SHARES). The number, exercise price and vesting of
the Options will be as follows:
% of Options Exercise Price Vesting Date
------------ -------------- ---------------------------------------
25 A$0.60 First anniversary of commencement date
25 A$0.75 Second anniversary of commencement date
25 A$1.00 Third anniversary of commencement date
25 A$1.50 Fourth anniversary of commencement date
(ii) 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 and the terms of the Employee Share
Option Plan.
(iii) On an annual basis, the HeartWare Limited Board will, at its
sole discretion, review the Executives share option entitlements
and having taken into account factors such as the achievement of
specific milestones and other performance measures, consider the
granting of further options under the ESOP. The Board will also
take into account the overall level of the Company's Employee
Share Option Plan.
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(C) OTHER BENEFITS
(i) 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 ANNUAL LEAVE
8.1 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.
8.2 TAKING ANNUAL LEAVE
Annual leave will be taken at times approved by the Chief Executive
Officer. If the Executive accrues more than eight weeks of annual leave,
the Chief Executive Officer may direct the Executive to take some or all of
the Executive's accrued annual leave entitlement upon eight weeks' written
notice.
9 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 two
days.
10 LONG SERVICE LEAVE
The Executive will be entitled to long service leave in accordance with the
Long Service Leave ▇▇▇ ▇▇▇▇ (NSW).
11 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:
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(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.
12 CONFIDENTIAL INFORMATION
12.1 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 Company 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.
12.2 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.
12.3 SECURITY OF CONFIDENTIAL INFORMATION
The Executive must maintain effective security measures to protect all
Confidential Information from unauthorised access, use, copying or
disclosure.
12.4 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 Company in writing to the contrary.
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13 TERMINATION
13.1 TERMINATION BY THE EXECUTIVE ON NOTICE
The Executive may terminate this Agreement upon giving three months'
written notice to the Chief Executive Officer.
13.2 TERMINATION BY THE COMPANY ON NOTICE
The Company may at any time terminate the Employment by giving three
months' written notice to the Executive.
13.3 TERMINATION BY THE COMPANY FOR CAUSE
Without limiting the generality of CLAUSE 13.2, 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 Company 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);
(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 ▇▇▇ ▇▇▇▇;
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(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 Executives 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 13.3, 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 13.3(J)
he will be paid three months' remuneration calculated at the rate of the
Remuneration Package payable to the Executive immediately prior to the
termination of his employment.
13.4 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.
13.5 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:
(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
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(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.
13.6 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 except as provided
for in this document.
13.7 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) All amounts due and payable to the Executive in accordance with the
Remuneration Package, 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;
13.8 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.
13.9 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 provided that the Company
gives reasonable details in writing of such set-off, including the
relevant calculation thereto.
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14 NON-COMPETITION
14.1 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;
(b) for a period of:
(i) 6 months;
(ii) 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.
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14.2 CONSTRUCTION OF NON-COMPETE CLAUSE
CLAUSE 14.1 will be construed and have effect as if it were the number of
separate sub-clauses which results from combining the commencement of
CLAUSE 14.1 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.
14.3 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.
14.4 EXECUTIVE MAY HOLD SHARES
This CLAUSE 14 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 Company or any Group Company in a
position which is not concerned with the management, strategic direction,
marketing or sales functions of that Business.
15 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.
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The Executive acknowledges that an order for damages would be an inadequate
remedy for any breach of CLAUSES 11, 12 or 14.1 and hereby consents and
agrees that in the event he commits any breach of any of these clauses:
(e) the Company will be entitled to immediate relief by way of injunction
without the necessity to prove any loss or damage; and
(f) 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.
16 RETURN OF PROPERTY
16.1 RETURN OF PROPERTY
Upon termination of the Employment, or at any time upon request by the
Company, 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.
16.2 DESTRUCTION OF PROPERTY
The Executive will, upon request by the Company, 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 stored so that the information cannot be recovered or
reconstructed, and certify in writing to the Company that such items or
Confidential Information have been destroyed or erased.
17 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.
18 NOTICES
18.1 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.
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18.2 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.
18.3 PARTICULARS FOR DELIVERY OF NOTICES
(a) The particulars for delivery of notices are initially:
COMPANY:
Address: as set out above
Fax: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
Attention: The Chairman
EXECUTIVE:
Address: as set out above
(b) Each party may change its particulars for delivery of notices by
notice to each other party.
18.4 COMMUNICATIONS BY POST
Subject to CLAUSE 18.6, 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.
18.5 COMMUNICATIONS BY FAX
(a) Subject to CLAUSE 18.6, 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
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Business Day) of completion of the transmission. This CLAUSE 18.5
applies to any retransmission.
18.6 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.
18.7 PROCESS SERVICE
Any process or other document relating to litigation, administrative or
arbitral proceedings relating to this document may be served by any method
contemplated by this CLAUSE 18 or in accordance with any applicable law.
19 MISCELLANEOUS
19.1 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.
19.2 ASSIGNMENT
Neither party will assign any of its rights under this document.
19.3 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.
19.4 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.
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19.5 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.
page 18
SCHEDULE 1
DESCRIPTION OF ROLE
POSITION TITLE DIRECTOR, CORPORATE DEVELOPMENT
-------------- -------------------------------
POSITION RATIONALE HeartWare has successfully raised $30 million.
This funding has been provided on the expectation
that the company will achieve certain critical
milestones over the next 12-18 months. The
overriding focus of the management team in the
short term must therefore be operational, with
the goal of accelerating the development of the
HVAD towards the commencement of clinical trials.
The success of the company in the longer term,
however, is contingent on its ability to access
further capital. Strategies need to be
implemented today to ensure that future funds can
be secured on optimal terms. Given the complexity
of the company's structure and the critical stage
of product development, management focus is
currently consumed by near term operational
imperatives. There is insufficient management
capacity to develop and implement these financing
strategies.
The Director, Corporate Development will be
responsible for securing the future financing of
the business.
POSITION DESCRIPTION To proactively manage the relationships with all
external stakeholders both to minimize the
company's future cost of capital and to optimise
its strategic positioning for a future liquidity
event.
RESPONSIBILITIES 1. Manage and / or assist the CEO in
relationships with external stakeholders to
help drive market value:
a. shareholders;
b. stockbrokers and analysts;
c. journalists and commentators;
d. company advisers - both medical and
corporate
e. opinion leaders, in both the medical
and financial communities;
f. customers and suppliers;
g. competitors; and collaborators
RESPONSIBILITIES 2. Identify and secure new institutional
(continued) investors, both in Australia and overseas,
to consolidate the shareholder base;
3. Develop and implement optimal capital
raising strategy to secure funds for the
next stage of the company's development;
4. Identify and secure any available
alternative (non-equity) sources of
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funding;
5. Ensure that HeartWare is positioned
advantageously relative to competitors in
order to maximise its relative value and
facilitate access to capital;
6. Develop and implement a long-term plan that
positions HeartWare to maximize shareholder
value on exit. (For instance, identify
preferred future corporate partners,
distributors or acquirers and begin to
▇▇▇▇▇▇ strategic relationships.)
7. Determine (in time) the optimal exit
strategy - whether by way of a US listing or
strategic sale - and facilitate execution.
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SCHEDULE 2
REMUNERATION PACKAGE
The Remuneration Package as at the date of this document is as follows:
(a) $250,000 (inclusive of superannuation)
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EXECUTED as an agreement
EXECUTED BY HEARTWARE LIMITED )
)
/s/ ▇▇▇▇▇▇ Rain ▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------------- ----------------------------------------
Company Secretary/Director Director
▇▇▇▇▇▇ Rain ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Name of Company Secretary/Director Name of Director (print)
(print)
SIGNED by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ in the )
presence of: )
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇ /s/ ▇. ▇▇▇▇▇▇▇
------------------------------------- ----------------------------------------
Witness
▇▇▇▇▇▇▇ ▇▇▇▇
Name of Witness (print)
page 22
