Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

AGREEMENT dated as of July 1, 2016 between Brian deGuzman, residing at
____________________________ (“Executive”), and PAVmed Inc., a Delaware
corporation having its principal office at One Grand Central Place, Suite 4600,
New York, New York 10165 (“Company”);

 

WHEREAS, the Company desires to employ Executive, and Executive desires to be
employed by the Company, on the terms and conditions herein set forth;

 

IT IS AGREED:

 

1.             Employment, Duties and Acceptance.

 

1.1         General. The Company hereby agrees to employ the Executive as its
Executive Vice President and Chief Medical Officer. All of Executive’s powers
and authority in any capacity shall at all times be subject to the direction and
control of the Company’s Chief Executive Officer and Board of Directors
(“Board”). The Board may assign to Executive such management and supervisory
responsibilities and executive duties for the Company or any subsidiary of the
Company, including serving as an executive officer and/or director of any
subsidiary, as are consistent with Executive’s status as executive vice
president and chief medical officer.

 

1.2         Duties. Executive accepts such employment and agrees to devote such
time as he reasonably deems necessary to the performance of his duties
hereunder. Nothing herein shall be construed as preventing Executive from (i)
making and supervising investments on a personal or family basis (including
trusts, funds and investment entities in which Executive or members of his
family have an interest) and (ii) in serving as a consultant to, or on boards of
directors of, or in any other capacity to other companies, for profit and not
for profit, provided they will not interfere with the performance of Executive’s
duties hereunder or violate the provisions of Section 5.4 hereof.

 

1.3         Location. Executive will perform his duties in New York, New York
and in Phoenix, Arizona, as determined by the Board. Executive shall undertake
such occasional travel, within or outside the United States, as is reasonably
necessary in the interests of the Company.

 

 

 

 

2.             Term. The term of Executive’s employment hereunder shall commence
on July 1, 2016 (“Commencement Date”) and terminate on the five year anniversary
of such Commencement Date (“Term”) unless terminated earlier as hereinafter
provided in this Agreement, or unless extended by mutual written agreement of
the Company and Executive. Unless the Company and Executive have otherwise
agreed in writing, if Executive continues to work for the Company after the
expiration of the Term, his employment thereafter shall be under the same terms
and conditions provided for in this Agreement, except that his employment will
be on an “at will” basis and the provisions of Sections 4.4 and 4.6(c) shall no
longer be in effect.

 

3.             Compensation and Benefits.

 

3.1         Salary. The Company shall pay to Executive a salary (“Base Salary”)
at the annual rate of $285,000. Executive’s compensation shall be paid in equal,
periodic installments in accordance with the Company’s normal payroll
procedures.

 

3.2         Bonus. In addition to the Base Salary, Executive shall be paid an
initial bonus of $50,000 on the execution of this Agreement in consideration of
the services previously provided to the Company and be eligible to receive an
annual discretionary performance bonus (“Bonus”) with a target of forty percent
(40%) of the Executive’s annualized Base Salary based on Executive’s and the
Company’s performance over the preceding year in the sole discretion of the
Board.

 

3.3         Stock Options. The Board (or Compensation Committee) may, in its
sole discretion, grant Employee options to purchase shares of the Company’s
common stock from time to time under the Company’s equity compensation plans,
but Executive understands that it is under no obligation to do so.

 

3.4         Benefits. Executive shall be entitled to such medical, life,
disability and other benefits as are generally afforded to other executives of
the Company, subject to applicable waiting periods and other conditions, as well
as participation in all other company-wide employee benefits, including a
defined contribution pension plan and 401(k) plan, as may be made available
generally to executive employees from time to time.

 

3.5         Vacation and Sick Days. Executive shall be entitled to twenty five
(25) days of paid vacation and five (5) days of paid sick days in each year
during the Term and to a

 

 

 

 

reasonable number of other days off for religious and personal reasons in
accordance with customary Company policy.

 

3.6         Expenses. The Company shall pay or reimburse Executive for all
transportation, hotel and other expenses reasonably incurred by Executive on
business trips and for all other ordinary and reasonable out-of-pocket expenses
actually incurred by him in the conduct of the business of the Company,
including expenses relating to his laptop, cell phone and Blackberry or other
similar devices, against itemized vouchers submitted with respect to any such
expenses and approved in accordance with customary procedures.

 

4.             Termination.

 

4.1         Death. If Executive dies during the Term, Executive’s employment
hereunder shall terminate and the Company shall pay to Executive’s estate the
amount set forth in Section 4.6(a).

 

4.2         Disability. The Company, by written notice to Executive, may
terminate Executive’s employment hereunder if Executive shall fail because of
illness or incapacity to render services of the character contemplated by this
Agreement for one hundred eighty (180) days. Upon such termination, the Company
shall pay to Executive the amount set forth in Section 4.6(a).

 

4.3         By Company for “Cause”. The Company, by written notice to Executive,
may terminate Executive’s employment hereunder for “Cause”. As used herein,
“Cause” shall mean: (a) the refusal or failure by Executive to carry out
specific directions of the Board which are of a material nature and consistent
with his status as Executive Vice President and Chief Medical Officer (or
whichever positions Executive holds at such time), or the refusal or failure by
Executive to perform a material part of Executive’s duties hereunder; (b) the
commission by Executive of a material breach of any of the provisions of this
Agreement; (c) fraud or dishonest action by Executive in his relations with the
Company or any of its subsidiaries or affiliates (“dishonest” for these purposes
shall mean Executive’s knowingly or recklessly making of a material misstatement
or omission for his personal benefit); or (d) the conviction of Executive of a
felony under federal or state law. Notwithstanding the foregoing, no “Cause” for
termination shall be deemed to exist with respect to Executive’s acts described
in clauses (a) or (b) above, unless the Company shall have given written notice
to Executive within a period not to exceed

 

 

 

 

ten (10) calendar days of the initial existence of the occurrence, specifying
the “Cause” with reasonable particularity and, within thirty (30) calendar days
after such notice, Executive shall not have cured or eliminated the problem or
thing giving rise to such “Cause;” provided, however, no more than two cure
periods need be provided during any twelve-month period. Upon such termination,
the Company shall pay to Executive the amount set forth in Section 4.6(b).

 

4.4         By Executive for “Good Reason”. The Executive, by written notice to
the Company, may terminate Executive’s employment hereunder if a “Good Reason”
exists. For purposes of this Agreement, “Good Reason” shall mean the occurrence
of any of the following circumstances without the Executive’s prior written
consent: (a) a substantial and material adverse change in the nature of
Executive’s title, duties or responsibilities with the Company that represents a
demotion from his title, duties or responsibilities as in effect immediately
prior to such change (such change, a “Demotion”); (b) material breach of this
Agreement by the Company; (c) a failure by the Company to make any payment to
Executive when due, unless the payment is not material and is being contested by
the Company, in good faith; or (d) a liquidation, bankruptcy or receivership of
the Company. Notwithstanding the foregoing, no “Good Reason” shall be deemed to
exist with respect to the Company’s acts described in clauses (a), (b) or (c)
above, unless Executive shall have given written notice to the Company within a
period not to exceed ten (10) calendar days of the initial existence of the
occurrence, specifying the “Good Reason” with reasonable particularity and,
within thirty (30) calendar days after such notice, the Company shall not have
cured or eliminated the problem or thing giving rise to such “Good Reason”;
provided, however, that no more than two cure periods shall be provided during
any twelve-month period of a breach of clauses (a), (b) or (c) above. Upon such
termination, the Company shall pay to Executive the amount set forth in Section
4.6(c).

 

4.5         By Company Without “Cause”. The Company may terminate Executive’s
employment hereunder without “Cause” by giving at least one hundred eighty (180)
days written notice to Executive. Upon such termination, the Company shall pay
to Executive the amount set forth in Section 4.6(c).

 

4.6         Compensation Upon Termination. In the event that Executive’s
employment hereunder is terminated, the Company shall pay to Executive the
following compensation:

 

 

 

 

(a)          Payment Upon Death or Disability. In the event that Executive’s
employment is terminated pursuant to Sections 4.1 or 4.2, the Company shall no
longer be under any obligation to Executive or his legal representatives
pursuant to this Agreement except for: (i) the Base Salary due Executive
pursuant to Section 3.1 hereof through the date of termination; (ii) any Bonus
which would have become payable under Section 3.2 for the year in which the
employment was terminated prorated by multiplying the full amount of the Bonus
by a fraction, the numerator of which is the number of “full calendar months”
worked by Executive during the year of termination and the denominator of which
is 12 (a “full calendar month” is a month in which the Executive worked at least
two weeks); (iii) all earned and previously approved but unpaid Bonuses for any
year prior to the year of termination; (iv) all valid expense reimbursements,
and (v) all accrued but unused vacation pay.

 

(b)          Payment Upon Termination by the Company For “Cause”. In the event
that the Company terminates Executive’s employment hereunder pursuant to Section
4.3, the Company shall have no further obligations to the Executive hereunder,
except for: (i) the Base Salary due Executive pursuant to Section 3.1 hereof
through the date of termination (ii) all valid expense reimbursements and (ii)
all unused vacation pay through the date of termination required by law to be
paid.

 

(c)          Payment Upon Termination by Company Without Cause or by Executive
for Good Reason. In the event that Executive’s employment is terminated pursuant
to Sections 4.4 or 4.5, the Company shall have no further obligations to
Executive hereunder except for: (i) the Base Salary due Executive pursuant to
Section 3.1 hereof through the end of the Term, payable in full; (ii) all valid
expense reimbursements; and (iii) all accrued but unused vacation pay.

 

(d)          Executive shall have no duty to mitigate awards paid or payable to
him pursuant to this Agreement, and any compensation paid or payable to
Executive from sources other than the Company will not offset or terminate the
Company’s obligation to pay to Executive the full amounts pursuant to this
Agreement.

 

5.             Protection of Confidential Information; Non-Competition.

 

5.1         Acknowledgment. Executive acknowledges that:

 

 

 

 

(a)          As a result of his current and prior employment with the Company,
Executive has obtained and will obtain secret and confidential information
concerning the business of the Company and its subsidiaries (referred to
collectively in this Section 5 as the “Company”), including, without limitation,
financial information, proprietary rights, trade secrets and “know-how,”
customers and sources (“Confidential Information”).

 

(b)          The Company will suffer substantial damage which will be difficult
to compute if, during the period of his employment with the Company or
thereafter, Executive should enter a business competitive with the Company or
divulge Confidential Information.

 

(c)          The provisions of this Agreement are reasonable and necessary for
the protection of the business of the Company.

 

5.2         Confidentiality. Executive agrees that he will not at any time,
during the Term or thereafter, divulge to any person or entity any Confidential
Information obtained or learned by him as a result of his employment with the
Company, except (i) in the course of performing his duties hereunder, (ii) with
the Company’s prior written consent; (iii) to the extent that any such
information is in the public domain other than as a result of Executive’s breach
of any of his obligations hereunder; or (iv) where required to be disclosed by
law, regulation, stock exchange rule, court order, subpoena or other government
process. If Executive shall be required to make disclosure pursuant to the
provisions of clause (iv) of the preceding sentence, Executive promptly, but in
no event more than 48 hours after learning of such subpoena, court order, or
other government process, shall notify, confirmed by mail, the Company and, at
the Company’s expense, Executive shall: (a) take all reasonably necessary and
lawful steps required by the Company to defend against the enforcement of such
subpoena, court order or other government process, and (b) permit the Company to
intervene and participate with counsel of its choice in any proceeding relating
to the enforcement thereof.

 

5.3         Documents. Upon termination of his employment with the Company,
Executive will promptly deliver to the Company all memoranda, notes, records,
reports, manuals, drawings, blueprints and other documents (and all copies
thereof) relating to the business of the Company and all property associated
therewith, which he may then possess or

 

 

 

 

have under his control; provided, however, that Executive shall be entitled to
retain copies of such documents reasonably necessary to document his financial
relationship with the Company.

 

5.4         Non-competition. During the Term and for a period of six (6) months
thereafter, Executive, without the prior written permission of the Company,
shall not, anywhere in the world, (i) be employed by, or render any services to,
any person, firm or corporation engaged in the medical device industry or any
other business which is directly in competition with any “material” business
conducted by the Company or any of its subsidiaries at the time of termination
(as used herein “material” means a business which generated at least 10% of the
Company’s consolidated revenues for the last full fiscal year for which audited
financial statements are available) (“Competitive Business”); (ii) engage in any
Competitive Business for his or its own account; (iii) be associated with or
interested in any Competitive Business as an individual, partner, shareholder,
creditor, director, officer, principal, agent, employee, trustee, consultant,
advisor or in any other relationship or capacity; (iv) employ or retain, or have
or cause any other person or entity to employ or retain, any person who was
employed or retained by the Company while Executive was employed by the Company
(other than Executive’s personal secretary and assistant); or (v) solicit,
interfere with, or endeavor to entice away from the Company, for the benefit of
a Competitive Business, any of its customers or other persons with whom the
Company has a contractual relationship. Notwithstanding the foregoing, nothing
in this Agreement shall preclude Executive from investing his personal assets in
any manner he chooses, provided, however, that Executive may not, during the
period referred to in this Section 5.4, own more than 4.9% of the equity
securities of any Competitive Business.

 

5.5         Injunctive Relief. If Executive commits a breach, or threatens to
commit a breach, of any of the provisions of Sections 5.2 or 5.4, the Company
shall have the right and remedy to seek to have the provisions of this Agreement
specifically enforced by any court having equity jurisdiction, it being
acknowledged and agreed by Executive that the services being rendered hereunder
to the Company are of a special, unique and extraordinary character and that any
such breach or threatened breach will cause irreparable injury to the Company
and that money damages will not provide an adequate remedy to the Company. The
rights and remedies enumerated in this Section 5.5 shall be in addition to, and
not in lieu of, any other rights and remedies available to the Company under law
or equity. In connection with any legal action or proceeding arising out of or
relating to this Agreement, the prevailing party in such

 

 

 

 

action or proceeding shall be entitled to be reimbursed by the other party for
the reasonable attorneys’ fees and costs incurred by the prevailing party.

 

5.6         Modification. If any provision of Sections 5.2 or 5.4 is held to be
unenforceable because of the scope, duration or area of its applicability, the
tribunal making such determination shall have the power to modify such scope,
duration, or area, or all of them, and such provision or provisions shall then
be applicable in such modified form.

 

5.7         Survival. The provisions of this Section 5 shall survive the
termination of this Agreement for any reason, except in the event Executive is
terminated by the Company without “Cause,” or if Executive terminates this
Agreement with “Good Reason,” in either of which events, clauses (i), (ii) and
(iii) of Section 5.4 shall be null and void and of no further force or effect.
The non-renewal of this Agreement at the end of the Term shall not be a
termination by the Company without “Cause”.

 

6.             Miscellaneous Provisions.

 

6.1         Notices. All notices provided for in this Agreement shall be in
writing, and shall be deemed to have been duly given when (i) delivered
personally to the party to receive the same, or (ii) when mailed first class
postage prepaid, by certified mail, return receipt requested, addressed to the
party to receive the same at his or its address set forth below, or such other
address as the party to receive the same shall have specified by written notice
given in the manner provided for in this Section 6.1. All notices shall be
deemed to have been given as of the date of personal delivery or mailing
thereof.

 

If to Executive:

 

Brian deGuzman

__________________

__________________

 

If to the Company:

 

PAVmed Inc.

One Grand Central Place, Suite 4600

New York, NY 10165

 

With a copy in either case to:

 

 

 

 

Graubard Miller

The Chrysler Building

405 Lexington Ave, 11th Floor

New York, NY 10170

 

6.2         Entire Agreement; Waiver. This Agreement sets forth the entire
agreement of the parties relating to the employment of Executive and is intended
to supersede all prior negotiations, understandings and agreements. No
provisions of this Agreement may be waived or changed except by a writing by the
party against whom such waiver or change is sought to be enforced. The failure
of any party to require performance of any provision hereof or thereof shall in
no manner affect the right at a later time to enforce such provision.

 

6.3         Governing Law. All questions with respect to the construction of
this Agreement, and the rights and obligations of the parties hereunder, shall
be determined in accordance with the law of the State of New York applicable to
agreements made and to be performed entirely in New York.

 

6.4         Binding Effect; Nonassignability. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of the Company. This
Agreement shall not be assignable by Executive, but shall inure to the benefit
of and be binding upon Executive’s heirs and legal representatives.

 

6.5         Severability. Should any provision of this Agreement become legally
unenforceable, no other provision of this Agreement shall be affected, and this
Agreement shall continue as if the Agreement had been executed absent the
unenforceable provision.

 

6.6         Section 409A. This Agreement is intended to comply with the
provisions of Section 409A of the Internal Revenue Code (“Section 409A”). To the
extent that any payments and/or benefits provided hereunder are not considered
compliant with Section 409A, the parties agree that the Company shall take all
actions necessary to make such payments and/or benefits become compliant.

 

6.7         Preparation of Agreement. This Agreement has been prepared by
Graubard Miller (“GM”) solely as counsel to the Company.  GM is not acting as
legal counsel nor providing any legal representation or consultative services to
Executive in connection with

 

 

 

 

the Agreement and the Company has advised Executive to seek the advice of other
counsel in connection with the negotiation and preparation of this Agreement.

 

 

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement on the date first
above written.

 

  PAVMED INC.           /s/ Lishan Aklog, M.D.     By:  Lishan Aklog, M.D.      
    /s/ Brian deGuzman, M.D.     Brian deGuzman, M.D.