EMPLOYMENT AGREEMENT

 

This Employment Agreement (together with any Exhibits hereto, this “Agreement”) is made and entered into effective this 6^th day of June, 2016, between Cogentix Medical, Inc., a Minnesota corporation (the “Company”) and Brett Reynolds (“Employee”) (each a “Party” and together the “Parties.”).

 

WHEREAS, the Company is a global medical company that provides proprietary, innovative technologies to specialty markets including urology, gynecology, bariatric medicine, critical care, gastroenterology, otolaryngology, and pulmonology.

 

WHEREAS, the Company and the Employee desire to set forth in this Agreement the terms under which Employee will serve as Chief Financial Officer of the Company.

 

NOW, THEREFORE, the Parties agree as follows.

 

1.             EMPLOYMENT. The Company hereby employs Employee as the Senior Vice President and Chief Financial Officer of the Company and Employee accepts such employment. Employee agrees to serve the Company with undivided loyalty, to the best of his ability promote the interests and business of the Company, and devote his full business time, energy and skill to such employment.

 

 

 

 

3.             TERM. The term of this Agreement shall commence on June 13, 2016 (the “Start Date”) and shall continue indefinitely, until such time, if any, that this Agreement is terminated pursuant to Section 11 herein.

 

4.             BASE SALARY. The Company shall pay to Employee a Base Salary of Two Hundred Sixty Thousand Dollars ($260,000) per year, which shall be paid in installments at least twice per month in accordance with the Company’s normal payroll practices as are in effect from time to time. Such amount shall be reviewed on an annual basis and may be adjusted pursuant to the mutual agreement of the Company and Employee.

 

5.             BONUS. During the Term, beginning with the fiscal year ending December 31, 2016, Employee shall be entitled to participate in the annual cash incentive program established by the Board of Directors, and such bonus program shall include provisions allowing Employee to achieve a bonus equal to 40% of the base salary paid to Employee for such fiscal year if performance is achieved at the target performance established for such plan, prorated for days of service in Calendar Year 2016 to include days of service from previous employment dates The Bonus, if any, will be paid no later than seventy-five (75) days following the last day of the fiscal year in which such incentive compensation is earned. Employee must be employed on the date the Bonus is paid to be eligible for the Bonus, except as otherwise provided in Section II of this Agreement.

 

 

 

 

9.             REIMBURSEMENT OF BUSINESS EXPENSES. The Company shall reimburse Employee for the reasonable and necessary expenses incurred in connection with the performance of him duties in accordance with the rules and regulations of the Internal Revenue Service under the Internal Revenue Code of 1986, as amended (the “Code”) and the policies and procedures of the Company governing such expenses, upon presentation of appropriate vouchers for said expenses.

 

 

 

 

 

(i)

by the Company or its successors or assigns without Cause at any time other than during the two years following a Change of Control, the Company, or such successors or assigns, shall pay to Employee an amount equal to twelve times his monthly base salary and an amount equal to the Employee’s targeted bonus; or

 

(ii)

by the Company or its successors or assigns without Cause, or by the Employee for Good Reason, within the two years following a Change of Control, the Company, or such successors or assigns, shall pay to Employee an amount equal to twelve times Employee’s monthly base salary and an amount equal to Employee’s targeted bonus.

 

 

(i)

“Change in Control” shall have the meaning set forth in Section 12(i) of the Company’s 2015 Omnibus Incentive Plan award agreement.

 

(ii)

“Good Reason” shall mean:

 

(A)

the Company’s imposition of material and adverse changes, without the Employee’s consent, in the Employee’s principal duties, responsibilities, status, reporting relationship, title or authority, or the Company’s assignment of duties inconsistent with the Employee’s position;

 

(B)

a material reduction in the Employee’s annual base salary or target annual incentive compensation opportunity;

 

(C)

the Company moving its principal executive offices (Minnetonka, MN) more than 50 miles from its current location without the Employee’s consent; or

 

(D)

the Company’s material breach of this Agreement; and

 

 in the case of each of (iii)(A)— (D), such condition remains uncured by the Company after receipt of thirty (30) days prior written notice of the existence of such condition.

 

 

 

 

 

14.          EXCISE TAX. Notwithstanding anything contained in this Agreement to the contrary, to the extent that the payments and benefits provided under this Agreement and benefits provided to, or for the benefit of, the Employee under any other Company plan or agreement (such payments or benefits are collectively referred to as the “Payments”) would be subject to the excise tax (the “Excise Tax”) imposed under Section 4999 of the Code, the Payments shall be reduced (but not below zero) if and to the extent necessary so that no Payment to be made or benefit to be provided to Employee shall be subject to the Excise Tax (such reduced amount is hereinafter referred to as the “Limited Payment Amount”). Unless the Employee shall have given prior written notice specifying a different order to the Company to effectuate the foregoing, the Company shall reduce or eliminate the Payments, by first reducing or eliminating the portion of the Payments which are not payable in cash and then by reducing or eliminating cash payments, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time from the Determination (as hereinafter defined). Any notice given by Employee pursuant to the preceding sentence shall take precedence over the provisions of any other plan, arrangement or agreement governing the Employee’s rights and entitlements to any benefits or compensation.

 

 

 

 

 

 

 

 

 

 

 

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above:

 

 

 

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