NEWCARDIO, INC. EMPLOYMENT AGREEMENT

Exhibit 10.28

 

NewCardio, Inc.

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into as of August 18, 2008 (the “Effective Date”) by and between NewCardio, Inc., a Delaware corporation (the “Company”), and Vincent W. Renz, Jr., MBA (the “Executive”).

BACKGROUND

A.           The Company desires to retain the services of the Executive as the President & Chief Operating Officer of the Company from the Effective Date.  The Company also desires to provide employment security to the Executive, thereby inducing the Executive to continue employment with the Company and enhancing the Executive’s ability to perform effectively.

B.           The Executive is willing to be employed by the Company on the terms and subject to the conditions set forth in this Agreement.

1.           Title, Duties and Responsibilities.

1.1           Title.  The Executive will be employed by the Company as its President & Chief Operating Officer, at the pleasure of the Board of Directors of the Company (the “Board”).  Executive shall report directly to the Chief Executive Officer.

1.2           Duties.  The Executive’s duties shall be described generally to include, but not be limited to, sales, marketing, regulatory, business operations that shall include IT infrastructure,  systems validation, tactical systems development, professional services, customer service, corporate systems, and human resources, and such other duties consistent with Executive’s title or as requested by the Board.  The Executive will devote all of the Executive’s business time, energy, and skill to the affairs of the Company; provided, however, that reasonable time for the activities set forth on Exhibit A and such other activities which have been approved in advance by the Board will be permitted, in any case so long as such activities do not materially interfere with the Executive’s performance of services under this Agreement.

1.3           Performance of Duties.  The Executive will discharge the duties described herein and duties as set forth by the Board from time to time, in a diligent and professional manner.  The Executive will further comply with the Company’s business policies, rules and regulations, as adopted from time to time by the Board.

2.           Terms of Employment.

2.1           Definitions.  For purposes of this Agreement, the following terms will have the following meanings:

 

 

(a)           “Accrued Compensation” means any accrued Total Cash Compensation, any benefits under any plan of the Company in which the Executive is a participant to the full extent of the Executive’s rights under such plans, any accrued vacation pay, and any appropriate business expenses incurred by the Executive in connection with the performance of the Executive’s duties hereunder, all to the extent unpaid on the date of termination.

(b)           “Base Salary” will have the meaning set forth in Section 3.1 hereof.

(c)            “Death Termination” means termination of the Executive’s employment due to the death of the Executive.

(d)           “Disability Termination” means termination of the Executive’s employment by the Company due to the Executive’s incapacitation due to disability.  The Executive will be deemed to be incapacitated due to disability if at the end of any month the Executive is unable to perform substantially all of the Executive’s duties under this Agreement in the normal and regular manner due to illness, injury or mental or physical incapacity, and has been unable so to perform for either (i) three consecutive full calendar months then ending, or (ii) 90 or more of the normal working days during the 12 consecutive full calendar months then ending.  Nothing in this paragraph will alter the Company’s obligations under applicable law, which may, in certain circumstances, result in the suspension or alteration of the foregoing time periods.

(e)           “Termination For Cause” means termination of the Executive’s employment by the Company due to (i) the Executive’s dishonesty or fraud, or negligence in the performance of the Executive’s duties and responsibilities; (ii) the Executive’s conviction of a felony involving moral turpitude; (iii) the Executive’s incurable material breach of the terms of this Agreement or the Confidentiality Agreement (as defined below); or (iv) the willful and continued refusal by Executive to substantially perform Executive’s duties or responsibilities for the Company described herein and as set forth by the Board from time to time.

(f)           “Termination Other Than For Cause” means termination of the Executive’s employment by the Company due to any reason other than as specified in Sections 2.1(c), (d), or (e) hereof.

(g)           “Total Cash Compensation” means the Executive’s Base Salary plus any cash bonuses, commissions or similar payment accrued during the preceding calendar year, and if there is no complete preceding calendar year, then the preceding twelve (12) month period, and if there is no complete preceding twelve (12) month period, then the preceding employment period annualized to a twelve (12) month period.

(h)           “Voluntary Termination” means termination of the Executive’s employment by the voluntary action of the Executive, other than by reason of a Disability Termination or a Death Termination.

 

2.2           Employee at Will.  The Executive is an “at will” employee of the Company, and the Executive’s employment may be terminated by the Company at any time by giving the Executive written notice thereof, subject to the terms and conditions of this Agreement and the At-Will Employment, Confidential Information, Invention Assignment and Arbitration Agreement and attached as Exhibit B hereto (the “Confidentiality Agreement”), the terms of which are herein incorporated by reference.

2.3           Termination For Cause.  Upon a Termination For Cause, the Company shall provide 30 days notice, and the Company will pay the Executive Accrued Compensation, if any.

2.4           Termination Other Than For Cause.

(a)           Upon a Termination Other Than For Cause, the Company shall provide 30 days notice, and provided Executive executes and delivers to the Company a release and waiver of claims in the form attached hereto as Exhibit C and such release and waiver of  claims is not revoked and has become effective pursuant to its terms, the Company will pay or reimburse, as applicable, the Executive upon the effectiveness of such release and waiver of claims: (a) Accrued Compensation, if any, and (b) a monthly cash severance payment equal to six (6) months of Executive’s then Base Salary, and (c) six (6) months of Executive’s COBRA-related expenses, provided that such COBRA-related reimbursement shall cease upon such date that Executive is afforded health benefits from a subsequent employer, , and (d)  six (6) months of accelerated vesting of the unvested common stock held by Executive at the time of such termination.

2.5           Disability Termination.  The Company will have the right to effect a Disability Termination by giving written notice thereof to the Executive.  Upon a Disability Termination, the Company will pay the Executive Accrued Compensation, if any.

2.6           Death Termination.  Upon a Death Termination, the Executive’s employment will be deemed to have terminated as of the last day of the month during which her death occurs, and the Company will promptly pay to the Executive’s estate Accrued Compensation, if any.

2.7           Voluntary Termination.  In the event the Executive wishes to consummate a Voluntary Termination, the Company requests that Executive give the Company ninety (90) days advance written notice.  During such period, the Executive will continue to receive regularly scheduled Base Salary payments and benefits.  Following the effective date of a Voluntary Termination, the Company will pay the Executive Accrued Compensation, if any.

2.8           Timing of Termination Payments.  Unless expressly provided otherwise, the foregoing termination payments will be made at the usual and agreed times provided for in Section 3.1 of this Agreement or as otherwise made during the normal course of employment.

 

3.           Compensation and Benefits.

3.1           Base Salary.  As payment for the services to be rendered by the Executive as provided in Section 1 and subject to the provisions of Section 2 of this Agreement, the Company will pay the Executive a “Base Salary” at the rate of $270,000.00 per year, payable on the Company’s normal payroll schedule.  The Executive’s “Base Salary” may be increased in accordance with the provisions hereof or as otherwise determined from time to time, but reviewed at least annually, by the Board or the Compensation Committee of the Board.

3.2           Additional Benefits.

(a)           Benefit Plans.  The Executive will be eligible to participate in such of the Company’s benefit plans as are now generally available or later made generally available to senior officers of the Company, including, without limitation, medical, dental, life, and disability insurance plans.

(b)           Expense Reimbursement.  The Company agrees to reimburse the Executive for all reasonable, ordinary and necessary travel and entertainment expenses incurred by the Executive in conjunction with the Executive’s services to the Company consistent with the Company’s standard reimbursement policies.  The Company will pay travel costs incurred by the Executive in conjunction with the Executive’s services to the Company consistent with the Company’s standard travel policies.

(c)           Vacation.  The Executive will be entitled to vacation as fitting the position, whereby it is discretionary and the executive will provide contact information while away. Vacation is not specifically accrued.

(d)           Bonus.  For fiscal year 2008, the Executive will be entitled to earn a prorated annual bonus based on Executive’s achievement of certain milestones to be defined by the Board and discussed with the Executive as soon as practicable following the date hereof, not exceed forty-five percent (45%) of Executive’s Base Salary as of the Effective Date. Bonuses to be paid to Executive in subsequent years shall be on terms and conditions determined by the Board.  Each annual (or prorated) bonus shall be paid not later than March 15 of the year following the year (or prorated year) for which the bonus is being paid.

3.3           Option to Purchase Common Stock.  Promptly following the Effective Date, the senior management of the Company will recommend that the Board grant the Executive an option (the “Option”) to purchase 800,000 shares of the Company’s Common Stock (the “Shares”) pursuant to the Company’s 2004 Equity Incentive Plan as Amended (the “Plan”) at an exercise price per share equal to the fair market value of a share of the Company’s Common Stock as of the date of such grant, as determined by the Board, and subject to the following vesting schedule: