Exhibit 10.15
Cambridge Heart,
Inc.
One Oak Park Drive
Bedford, MA 01730
EMPLOYMENT
AGREEMENT
Effective as of December 14,
2007
Ali Haghighi-Mood
c/o Cambridge Heart, Inc.
One Oak Park Drive
Bedford, MA 01730
Dear Ali:
You have agreed to serve as
President and Chief Executive Officer of Cambridge Heart, Inc. (the
“Company”). This Agreement sets forth the terms of your
employment by the Company effective as of December 14, 2007
(the “Effective Date”), when the Company’s Board
of Directors (the “Board”) elected you (the
“Executive”) as the Company’s President and Chief
Executive Officer.
1. CAPACITY AND
PERFORMANCE :
(a) The Executive will serve as the
Company’s President and Chief Executive Officer at the
pleasure of the Board or until the Executive resigns his employment
with the Company. The Board of Directors will elect the Executive
to serve as a director of the Company until at least the next
annual meeting of stockholders of the Company, and the Executive
agrees to serve in such capacity without further
compensation.
(b) Subject to the direction and
control of the Board and any committee thereof, the Executive shall
have full discretionary authority during the term of his employment
to control the Company’s day-to-day operations and shall have
all other powers and duties consistent with his position as
President and Chief Executive Officer. The Executive shall perform
such other duties and responsibilities on behalf of the Company as
may be designated from time to time by the Board, provided that
such duties shall be reasonably consistent with those duties
assigned to Chief Executive Officers in organizations comparable to
the Company.
(c) During the term of his
employment, the Executive shall devote substantially all of his
full business time and his best efforts, business judgment, skill
and knowledge to the advancement of the business and interests of
the Company and to the discharge of his duties and responsibilities
hereunder. The Executive shall comply with all lawful written
policies of the Company in effect from time to time. The Executive
shall not engage in any other business activity or serve in any
industry, trade, professional, governmental or academic position
during the term of this Agreement, except as may be expressly
approved in advance by the Board in
writing or to the extent that any such activity
or service does not adversely affect the performance of his duties
and responsibilities hereunder.
2. SALARY : The
Company shall pay the Executive a base salary at the rate of Two
Hundred Seventy Five Thousand Dollars ($275,000) per annum, payable
in accordance with the payroll practices of the Company for its
executives. Such base salary, as from time to time increased by the
Board in its sole discretion, is hereafter referred to as the
“Base Salary.”
3. BONUS : The
Executive shall have the opportunity to earn an annual performance
bonus for each of the years ended December 31, 2007 and 2008
in the amount, and contingent upon the achievement by the Company
of the performance criteria, set forth on Exhibit A hereto.
The Executive shall have the opportunity to earn an annual
performance bonus for subsequent years in the amount, and
contingent upon the achievement by the Company or the Executive, as
the case may be, of performance goals to be agreed upon by the
Executive and the Board or a compensation committee thereof. The
Company may, from time to time, pay such other bonus or bonuses to
the Executive as the Board or a compensation committee of the
Board, in its sole discretion, deems appropriate. Except as
otherwise provided herein, bonuses shall be paid at such time as
bonuses for the applicable period are regularly paid to senior
executives of the Company. In the event that the Executive’s
employment is terminated by the Company without Cause (as defined
hereafter) prior to December 31 of any year after 2008, the
Executive shall be entitled to receive a pro rated amount of the
portion of the performance bonus that is based upon the financial
results of the Company, if any, calculated based upon the
Company’s financial results through the end of the most
recent calendar quarter ended prior to the termination of the
Executive’s employment.
4. STOCK OPTIONS
:
(a) The Executive shall receive two
stock options (the “Stock Options”): (a) a stock
option to purchase Nine Hundred Thousand (900,000) shares of
common stock of the Company, which will be granted under, and shall
be subject to the terms and conditions of, the Company’s 2001
Stock Incentive Plan (the “2001 Plan”) and (b) a
stock option to purchase Four Hundred Fifty Thousand
(450,000) shares of common stock of the Company, which will be
granted as a stand-alone award outside of the Company’s
equity incentive plans but will be nevertheless governed by the
terms and conditions of the 2001 Plan as though they were granted
under the 2001 Plan. The Stock Options shall have an exercise price
equal to the closing price for shares of common stock of the
Company as reported on the OTC Bulletin Board on December 11,
2007, the date on which the Board of Directors awarded the Stock
Options subject to the execution of this Agreement by the Company
and the Executive. The Stock Options shall have a term of 10 years,
shall become exercisable in three equal annual installments
beginning on the first anniversary of the Effective Date, and shall
otherwise contain such terms and conditions consistent with the
terms and conditions of options regularly granted to senior
executives of the Company. The Stock Options shall become
exercisable in full in the event that a Change in Control of the
Company occurs (except with respect to any portion of such stock
options that have been exercised, forfeited or terminated prior to
the date of the Change in Control), provided that all such Stock
Options (including the portion accelerated upon a Change of
Control) must be exercised within the time periods set forth in the
applicable stock option agreement and the 2001 Plan.
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(b) Notwithstanding anything to the
contrary contained in the Severance Agreement dated
September 17, 2003 between the Company and the Executive, as
amended by letter agreement dated December 14, 2006, a copy of
which is attached hereto as Appendix A (the “Severance
Agreement”) or in the applicable stock option award
agreements, all stock options previously granted to the Executive
that are outstanding as of the date hereof, as more specifically
set forth on Exhibit B attached hereto, are hereby amended
to provide (i) that such options will immediately become
exercisable in full in the event that a Change in Control of the
Company occurs (except with respect to any portion of such stock
options that have been exercised, forfeited or terminated prior to
the date of the Change in Control) and (ii) that,
notwithstanding the foregoing, all such stock options (including
the portion accelerated upon a Change of Control) must be exercised
within the time periods set forth in the applicable stock option
agreement and the 2001 Plan.
5. VACATIONS : During
the term of his employment, the Executive shall be entitled to four
weeks of vacation per annum, to be taken at such times and
intervals as shall be determined by the Executive, subject to the
reasonable business needs of the Company. The Executive shall
accrue paid vacation leave in accordance with the same terms
applicable to other senior members of management, provided,
however, that up to four weeks of accrued vacation leave that
remains unused as of December 31 of each calendar year ending
during the term of the Executive’s employment shall be
carried forward into the immediately subsequent calendar year, and
provided further that in no event shall the vacation carry forward
attributable to any one or more years exceed four weeks.
6. BENEFITS : During
the term of his employment and subject to any contribution therefor
generally required of employees of the Company, the Executive shall
be entitled to participate in any and all employee benefit plans
from time to time in effect for employees of the Company generally,
except to the extent such plans are in a category of benefit
(including, without limitation, bonus compensation) otherwise
provided to the Executive. Such participation shall be subject to
(i) the terms of the applicable plan documents,
(ii) generally applicable Company policies and (iii) the
discretion of the Board or any administrative or other committee
provided for in or contemplated by such plan. The Company may
alter, modify, add to or delete its employee benefit plans at any
time as it, in its sole judgment, determines to be appropriate,
without recourse by the Executive.
7. BUSINESS EXPENSES :
The Company shall pay or reimburse the Executive for all reasonable
and necessary business expenses incurred or paid by the Executive
in the performance of his duties and responsibilities hereunder,
subject to reasonable substantiation and documentation as may be
specified by the Company from time to time.
8. TERMINATION AND
SEVERANCE :
(a) In the event of the
Executive’s death, the Executive’s employment shall
immediately and automatically terminate.
(b) The Company may terminate the
Executive’ employment upon notice to the Executive
(a) if Executive is disabled within the meaning of the
long-term disability insurance
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policy applicable to similarly situated
employees of the Company or (b) for “Cause” (as
defined in the Severance Agreement). The Executive agrees to submit
to medical examinations to determine whether he is disabled
pursuant to reasonable requests the Company may make from time to
time. Upon the giving of notice of termination of the
Executive’s employment hereunder due to the Executive’s
disability or for Cause, the Company shall not have any further
obligation or liability to the Executive, other than for Base
Salary earned and unpaid through the date of
termination.
(b) The Company also may terminate
the Executive’s employment without Cause upon notice to the
Executive. In the event the Company terminates the
Executive’s employment without Cause, the Executive shall
receive the severance benefits to which the Executive is entitled
under Paragraph 1 of the Severance Agreement. In the event that a
Change in Control occurs and the Executive’s employment with
the Company or the successor/acquiror of the Company is terminated
without Cause or by the Executive for Good Reason, in each case
within 12 months after a Change in Control Date, the Executive
shall receive the severance benefits to which the Executive is
entitled under Paragraph 3 of the Severance Agreement.
(c) The Executive may terminate his
employment with the Company, with or without cause, upon notice to
the Company. Subject to the Company’s right to terminate the
Executive’s employment pursuant to Sections 8(a) and (b), the
Executive may terminate his employment within 30 days following the
occurrence of Changed Circumstances (as defined below) upon written
notice to the Company describing the Changed Circumstances giving
rise to the Executive’s termination of employment. In the
event the Executive terminates his employment within 30 days
following the occurrence of Changed Circumstances, the Executive
shall be entitled to receive the severance benefits to which the
Executive is entitled under Paragraph 1 of the Severance Agreement
as though his employment had been terminated by the Company without
Cause. “Changed Circumstances” shall mean the
occurrence of one or both of the following events:
(i) a material reduction in the
nature or scope of the Executive’s responsibilities,
authority or powers as President and Chief Executive Officer of the
Company, including, without limitation, due to the Board having
hired or appointed another senior executive officer to whom the
Executive is requested by the Board to report or who reports
directly to the Board or who is given responsibilities or authority
normally exercised by an executive in the positions of President
and Chief Executive Officer of a Company generally comparable to
the Company, in each case without the Executive’s prior
written consent; and
(ii) any failure by the Company to
nominate and recommend to shareholders that they reelect the
Executive to serve as a director of the Company upon the expiration
of his term.
(d) For purposes of this Agreement,
the terms “Cause”, “Change in Control”,
“Change in Control Date”, and “Good Reason”
shall have the meanings set forth in the Severance
Agreement.
(e) Notwithstanding anything to the
contrary contained in this Agreement or the Severance Agreement,
the Executive agrees as follows:
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(i) The Executive’s right to
receive severance benefits hereunder and under the Severance
Agreement is conditioned upon (A) the Executive’s prior
execution and delivery to the Company of a general release of any
and all claims and causes of action of the Executive against the
Company and its officers and directors, excepting only (y) the
right to any salary and/or reimbursable expenses then accrued and
unpaid under Sections 2 and 7 of this Agreement and (z) rights
arising under applicable law, including, without limitation, rights
to extended health insurance coverage pursuant to the Consolidated
Omnibus Budget Reconciliation Act of 1986, as in effect from time
to time, and (B) the Executive’s continued performance
of those obligations hereunder that continue by their express terms
after the termination of his employment, including without
limitation those set forth in Sections 9 and 10 of this
Agreement.
(ii) Any severance benefits paid to
the Executive hereunder or under the Severance Agreement shall be
payable in accordance with the payroll practices of the Company for
its executives generally as in effect from time to time.
(iii) All amounts payable to the
Executive under this Agreement and the Severance Agreement are
intended meet the requirements of Section 409A of the Internal
Revenue Code of 1986, as amended, to the extent applicable, and
this Agreement and the Severance Agreement shall be interpreted in
accordance with such intent. Without limiting the scope of the
immediately preceding sentence, the severance payments provided for
under this Agreement and the Severance Agreement shall be deferred
for six months from the effective date of the termination of the
Executive’s employment if immediately prior to such
termination the Executive is, or in the Company’s sole
opinion may be, a “specified employee” as that term is
defined in Section 409A(a)(2)(B)(i) of the Code (a
“Specified Employee”). Notwithstanding the foregoing,
subject to the dollar limit set forth in Treasury Regulation
1.409A-1(b)(9)(iii), to the extent that the benefit distributions
to be made under this Agreement or the Severance Agreement
constitute deferred compensation subject to Code Section 409A
payable on account of separation from service withi
