Exhibit 10.1

 

AGREEMENT

 

This AGREEMENT (the “Agreement”), dated January 28, 2014 and effective for all
purposes as of December 31, 2013 (the “Effective Date”), is entered into by and
between Oren Fuerst (“Fuerst”) and LabStyle Innovations Corp., a Delaware
corporation (collectively with its subsidiaries, the “Company” and together with
Fuerst, each a “Party” and collectively, the “Parties”).

 

WHEREAS, the Parties entered into an Employment Agreement, dated March 15, 2012,
as amended on August 8, 2012 (the “Employment Agreement”), whereby Fuerst was
appointed Chief Executive Officer and Chairman of the Board of the Company;

 

WHEREAS, on August 9, 2013, the Board of Directors of the Company implemented a
certain internal management restructuring whereby Fuerst’s title was changed
from Chief Executive Officer and Chairman of the Board to Executive Chairman;

 

WHEREAS, Fuerst and the Company now desire to redefine Fuerst’s position in the
Company by changing Fuerst’s title from Executive Chairman to Chairman of the
Board and desire to memorialize the terms under which Fuerst shall serve as
Chairman of the Board of the Company as set forth herein; and

 

WHEREAS, in furtherance of the foregoing, Fuerst and the Company further desire
to terminate the Employment Agreement on the terms set forth herein.

 

NOW, THEREFORE, in consideration of the mutual agreements and covenants set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the Parties, and intending to be
bound hereby, the Parties hereby agree as follows:

 

1.                  Incorporation of Recitals. The above recitals are
incorporated herein by reference as operative and integral premises and parts of
this Agreement.

 

2.                  Mutually Agreed Termination of the Employment Agreement.
Pursuant to Section 6 of the Employment Agreement, as of the Effective Date, the
Parties hereby mutually agree to terminate the Employment Agreement in its
entirety, except for those provisions expressly intended to survive such
termination. Fuerst further voluntarily resigns as an officer or employee of the
Company and an officer, director or employee of any of the Company’s
subsidiaries. The Parties both waive any requirement of further advance notice
of such termination and any payment in lieu of such advance notice, except as
expressly set forth herein. Any confidentiality, nonsolicitation,
non-competition or intellectual property assignment agreement between the
Company and Fuerst (including Exhibit B to the Employment Agreement) shall
remain unmodified hereby and in full force and effect.

 

3.                  Appointment as Chairman of the Board; Payments.

 

3.1.            Duties. Following the Effective Date, Fuerst shall perform the
duties customarily associated with the position of Chairman of the Board of the
Company. Notwithstanding the foregoing, Fuerst shall not undertake any role or
duties in or related to, nor shall he have any responsibility or authority to
manage, the day-to-day operations of the Company. Fuerst agrees to devote such
time as is reasonably and customarily necessary to perform completely the duties
as a Chairman of the Board of the Company and will perform such duties described
herein in accordance with (i) the Certificate of Incorporation and Bylaws of the
Company as amended from time to time, (ii) the fiduciary duties of directors
arising under the Delaware General Corporation Law and (iii) all other
applicable laws, rules and regulations.

 

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3.2.            Term. The term of this Agreement shall commence following the
Effective Date and shall continue until the expiration of Fuerst’s term as a
director of the Company (as such term may be extended by the vote of the
Company’s stockholders from time to time in accordance with applicable law, rule
or regulation) or his earlier death, removal, incapacity or resignation.

 

3.3.            Compensation. For all services to be rendered by Fuerst in any
capacity hereunder, the Company agrees to pay Fuerst a cash director’s fee of
$100,000 per annum, payable in equal quarterly installments in arrears, with the
first quarter’s payment due April 1, 2014 and each subsequent payment due by no
later than the last day of each quarter of service. In the event that Fuerst's
term as director of the Company expires on a day falling during a quarter, then
Fuerst shall be entitled to a pro rated portion of the quarterly installment
through the date of conclusion of his service.

 

3.4.            Bonus. The Company shall pay Fuerst a one lump sum bonus in the
amount of $250,000 following the Effective Date, subject to the achievement by
the Company of the following milestones: (i) the Company has initiated and
achieved commercial sales, regardless of sales volumes, and (ii) the Company
shall have received or earned cash in the aggregate gross amount of US$20
million through any combination of equity or debt financing or sales revenue
during the period from and after the Effective Date.

 

3.5.            Vesting of Options. For as long as Fuerst remains a member of
the Board of Directors of the Company, any unvested options to purchase shares
of Company common stock previously granted to Fuerst under the Company’s 2012
Equity Incentive Plan (the “Plan”) or otherwise shall continue to vest as such
are scheduled to vest as of and following the Effective Date pursuant to the
applicable Stock Option Agreements between Fuerst and the Company. The Company
agrees that the entry into this Agreement shall not impair Fuerst’s rights under
his vested employee options as of the Effective Date, even if and when he ceases
to be a director of the Company (including, but not limited to, not requiring
Fuerst to exercise the options following the Effective Date in spite of ceasing
to be an employee of the Company, if such a requirement exists under the Plan).
Provided Fuerst is at the applicable time a director of the Company, all options
held by Fuerst upon a Change of Control (as defined in the Employment
Agreement), will be subject to immediate full vesting.

 

3.6.            No Additional Payments. Except as expressly provided for herein
and other than as reimbursement for expenses or as entitled as a member of the
Board of Directors of the Company, Fuerst shall not be entitled to any other
fees, payments, bonuses, benefits or perquisites of any kind as an officer or
employee of the Company or otherwise from the Company, whether or not arising
under the Employment Agreement. Company agrees that it has paid or that it shall
be responsible for any required U.S. and Israeli employment taxes due on payment
made or due to Fuerst as part of the Employment Agreement.

 

3.7.            No Withholding. The Company shall not be required to withhold
any tax or social benefit from any payments made hereunder, and Fuerst shall be
solely responsible for any taxes or similar items due on any payments made to
him hereunder.

 

4.                  Lock-Up. Fuerst agrees that he shall, while he continues to
serve as a director of the Company enter into any lock-up agreement that is also
entered into by each member of the Board of Directors in connection with any
financing by the Company.

 

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5.                  Release of Claims. Fuerst agrees that the foregoing
consideration represents settlement in full of all outstanding obligations owed
to Fuerst by the Company. Fuerst and the Company, on behalf of themselves, and
their respective heirs, family members, executors, officers, directors,
employees, stockholders, administrators, affiliates, divisions, subsidiaries,
predecessor and successor corporations, and assigns, hereby fully and forever
release each other and their respective heirs, family members, executors,
officers, directors, employees, stockholders, administrators, affiliates,
divisions, subsidiaries, predecessor and successor corporations, and assigns,
from, and agree not to sue concerning, any claim, duty, obligation or cause of
action relating to any matters of any kind, whether presently known or unknown,
suspected or unsuspected, that any of them may possess arising from any
omissions, acts or facts that have occurred up until and including the Effective
Date of this Agreement which relate to or arise from the Employment Agreement,
Fuerst’s employment relationship with the Company and the termination of that
relationship. This release does not extend to: (i) any obligations incurred
under this Agreement, (ii) any claims of the Company under Exhibit B to the
Employment Agreement, or (iii) any claims of fraud, gross negligence,
misrepresentation, breach of fiduciary duty or breach of any securities laws,
rules or regulations.

 

6.                  No Pending or Future Lawsuits. Fuerst represents that he has
no lawsuits, claims, or actions pending in his name, or on behalf of any other
person or entity, against the Company or any other person or entity referred to
herein. Company represents that it has no lawsuits, claims, or actions pending
in its name, or on behalf of any other person or entity, against Fuerst.

 

7.                  Indemnification. The Company shall indemnify, defend and
hold harmless Fuerst in his capacity as a director of the Company, to the full
extent allowed by the law of the State of Delaware, and as provided by, or
granted pursuant to, any charter provision, bylaw provision, vote of
disinterested directors or otherwise, as to action taken in Fuerst’s capacity as
a director of the Company. The Company shall use reasonable commercial efforts
continue to cause Fuerst to be covered under the Company’s director and officers
liability policy for so long as he is a director of the Company.

 

8.                  Construction. Any controversy regarding the construction of
this Agreement shall be decided neutrally, in light of its conciliatory purpose,
and without regard to the events of authorship or negotiation.

 

9.                  Binding Effect. This Agreement is binding upon and inures to
the benefit of the Parties hereto and their respective successors and assigns.

 

10.              Assignment. This agreement is not assignable without written
consent of the other party.

 

11.              Governing Law; Arbitration. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of Delaware
without giving effect to any choice or conflict of law provision or rule
(whether of the State of Delaware or any other jurisdiction) that would cause
the application of laws of any jurisdiction other than those of the State of
Delaware. Except as provided for in Section 17 of Exhibit B to the Employment
Agreement, in the event that the Company or Fuerst, his spouse or any other
person claiming benefits on behalf of or through Fuerst, has a dispute or claim
based upon this Agreement including the interpretation or application of the
terms and provisions of this Agreement, the sole and exclusive remedy is for
that party to submit the dispute to binding arbitration in accordance with the
rules of arbitration of the American Arbitration Association (“AAA”) in the City
and County of New York, USA. Any arbitrator selected to arbitrate any such
dispute shall be independent and neutral and will have the power to interpret
this Agreement. Any determination or decision by the arbitrator shall be binding
upon the parties and may be enforced in any court of law. The expenses of the
arbitrator will be paid 50% by the Company and 50% by Fuerst, his spouse or
other person, as the case may be, provided that the arbitrator shall be free to
apportion such fees between the parties as he/she may determine in their
discretion as permitted by the AAA rules of arbitration.

 

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12.              Severability. If any term or provision of this Agreement or the
performance thereof shall be invalid or unenforceable to any extent, such
invalidity or unenforceability shall not affect or render invalid or
unenforceable any other provision of this Agreement and this Agreement shall be
valid and enforced to the fullest extent permitted by law.

 

13.              Entire Agreement. This Agreement represents the entire
agreement and understanding between the Company and Fuerst concerning the
subject matter hereof and supersedes and replaces any and all prior agreements
and understandings related to such subject matter.

 

14.              No Oral Modification. This Agreement may only be amended in
writing signed by Fuerst and the President of the Company.

 

15.              Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one instrument.
Execution and delivery of this Agreement by facsimile or other electronic
signature is legal, valid and binding for all purposes.

 

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, this Agreement is made and entered into as of the date first
set forth above.

 

 

LABSTYLE INNOVATIONS CORP.

 

/s/ Erez Raphael

By: _______________________________

Name: Erez Raphael

Title: President and CEO

 

 

/s/ Oren Fuerst

_______________________________

Oren Fuerst

 

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