Exhibit 10.1

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

THIS AMENDED AND RESTATED AGREEMENT (the “Agreement”) is entered into as of
March 15, 2019 d between Lishan Aklog MD, residing at 10 Hickory Pine Court,
Purchase, NY 10577 (“Executive”), and PAVmed Inc., a Delaware corporation having
its principal office at One Grand Central Place, Suite 4600, New York, NY 10165
(“Company”) to become effectively immediately;

 

WHEREAS, the Company and Executive are party to an employment agreement entered
into and effective October 24, 2014 (the “Prior Agreement”);

 

WHEREAS, this Agreement amends and supersedes the Prior Agreement and any other
agreement with respect to the matters contained herein.

 

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and
agreements hereinafter set forth, the Company and the Executive hereby agree as
follows:

 

1. Employment, Duties and Acceptance.

 

1.1 General. The Company hereby agrees to employ the Executive as its Chief
Executive Officer (“CEO”) and Chairman of the Board of Directors (“Chairman”).
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 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 Chief Executive Officer
and Chairman. The Company and Executive acknowledge that Executive’s primary
functions and duties as Chief Executive Officer shall be general management and
control of the affairs and business of the Company.

 

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. 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 initial term of this agreement shall commence on March 15, 2019
(the “Effective Date”) and terminate on the third anniversary of the Effective
Date (the “Initial Term”) unless terminated earlier as hereinafter provided in
this Agreement. In addition, the term of this Agreement shall thereafter
automatically renew for periods of one-year (the “Renewal Term”) unless either
party gives written notice to the other party at least 60 days prior to the end
of the term or at least 60 days prior to any one-year renewal period, that the
Agreement shall not be further extended. The period commencing on the Effective
Date and ending on the date on which the term of the Executive’s employment
under the Agreement terminates is referred to herein as the “Term”

 

3. Compensation and Benefits.

 

3.1 Salary. The Company shall pay to Executive a salary (“Base Salary”) at the
annual rate of $431,000. 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 a bonus
(“Bonus”) on January 1st of each year beginning in 2020 equal to 50% of the Base
Salary, then in effect, plus additional performance bonuses to be determined by
the Board.3.3 Restrictive Common Stock Awards and 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. Upon the Effective Date, the Company shall grant
Executive 200,000 shares of the Company’s Restricted Common Stock under the
Company’s Second Amended 2014 Long-Term Incentive Plan (“Plan”). Subject to
continued service to the Company through the applicable vesting date and the
provisions of the Plan, the Restricted Common Stock shall become non-forfeitable
over three years in equal amounts on each anniversary date. Any unvested
forfeitable shares, shall become immediately vested and non-forfeitable in the
event of a termination for Good Reason or immediately after any Change of
Control as defined in the Restricted Common Stock Agreement and Indemnification
Agreement.

 

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. The Executive shall be eligible to
participate in the Company’s annual and long-term incentive plans and programs
in accordance with the terms of such plans and programs as in effect and
afforded to other senior executives of the Company at levels determined by the
Board (or committee of the Board).

 

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. Reimbursable
expenses do not include any expenses in respect of Executive’s commuting
transportation or his membership and activities at the Harvard Club of NY, which
are covered by Sections 3.7 and 3.8 below.

 

3.7 Transportation Allowance – The Company shall provide Executive an allowance
in the amount of $2,100 per month for commuting transportation or make direct
payments to Executive’s transportation company for up to $2,100 per month to
offset the costs incurred for travel during non-rush hour traffic as a result of
limited options to travel to/from Executive’s home base by public
transportation.

 

3.8 Harvard Club expense reimbursement – The Company shall provide Executive an
allowance of $1,200 per month to offset the cost of maintaining his membership
and activities at the Harvard Club of NY where the Company frequently engages
and hosts potential customers, vendors, bankers, and other Company related
personnel for the benefit of Company related business.

 

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 Chief Executive 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 thirty (30) 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; (d) a liquidation, bankruptcy or receivership of the
Company; (e) a change in the principal office or work place assigned to the
Executive to a location more than 35 miles distant from its location immediately
prior to such change; (f) a material reduction of the Executive’s base salary or
bonus opportunity, unless pursuant to a reduction in such items applicable
proportionally to all senior management and board members; or (g) any reason or
no reason following a Change of Control (as defined in the Restricted Common
Stock Agreement and the Indemnification Agreement) and the Executive’s notice of
resignation under this subsection is provided to the surviving entity following
a Change of Control within the 60-day period following the closing of the Change
of Control. Notwithstanding the foregoing, no “Good Reason” shall be deemed to
exist with respect to the Company’s acts described in clauses (a), (b), (c),
(e), or (f) above, unless Executive shall have given written notice to the
Company within a period not to exceed thirty (30) 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), (c),
(e) or (f) 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 sixty (60) 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 (iii) 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) 100% of the Base Salary due Executive pursuant to
Section 3.1 hereof for twelve (12) months or twenty-four (24) months in the
event of a Change of Control that occurred within 60 days of termination,
payable in full; (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) the Base Salary due Executive
pursuant to Section 3.1 hereof through the date of termination; (iv) all valid
expense reimbursements; (v) all accrued but unused vacation pay and (vi) to the
extent the Executive timely elects to receive continuation coverage pursuant to
the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“COBRA”), the Company shall pay or reimburse the Executive, on a monthly basis,
an amount equal to the full monthly premium for such coverage, from the date of
termination until the earlier of (A) the date twelve (12) months following the
date of termination, and (B) the date of Executive becoming eligible for
coverage under a new employer’s health insurance plan (the COBRA health care
continuation coverage period under Section 4980B of the Internal Revenue Code of
1986, as amended (the “Code”) shall run concurrently with the foregoing period),
subject, in the case of clause (i) and (ii), to Executive’s compliance with
Section 5 and to Executive’s execution of a release of claims in favor of the
Company, its affiliates and their respective officers and directors in a form
provided by the Company and such release becoming effective,.

 

(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 one (1) year
thereafter, or two (2) years thereafter in the event of a Change of Control
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,” (Good Reason for purposes of this Section shall not include
termination for Good Reason defined in Section 4.4 (g) in connection with a
Change of Control and while Executive is receiving payments in accordance with
Section 4.6 (c)) 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.

 

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:

Lishan Aklog, M.D.

10 Hickory Pine Court

Purchase, NY 10577

 

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 and the Restricted Common Stock
Award 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; Non-assignability. 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.

 

7. Arbitration; Expenses.

 

In the event of any dispute under the provisions of this Agreement, other than a
dispute in which the primary relief sought is an equitable remedy such as an
injunction, the parties shall be required to have the dispute, controversy or
claim settled by arbitration in the non-moving parties jurisdiction in
accordance with the Employment Arbitration Rules and Mediation Procedures then
in effect of the American Arbitration Association, before an arbitrator agreed
to by both parties. If the parties cannot agree upon the choice of arbitrator,
the Company and the Executive will each choose an arbitrator. The two
arbitrators will then select a third arbitrator who will serve as the actual
arbitrator for the dispute, controversy or claim. Any award entered by the
arbitrator shall be final, binding and nonappealable and judgment may be entered
thereon by either party in accordance with applicable law in any court of
competent jurisdiction. This arbitration provision shall be specifically
enforceable. The arbitrator shall have no authority to modify any provision of
this Agreement or to award a remedy for a dispute involving this Agreement other
than a benefit specifically provided under or by virtue of the Agreement. Each
party shall be responsible for its own expenses relating to the conduct of the
arbitration (including reasonable attorneys’ fees and expenses) and shall share
the fees of the American Arbitration Association.

 

8. Attorneys’ Fees.

 

Except as provided in Section 7 above, in any action at law or in equity to
enforce or construe any provisions or rights under this Agreement, the
unsuccessful party or parties to such litigation, as determined by the courts
pursuant to a final judgment or decree, shall pay the successful party or
parties all costs, expenses, and reasonable attorneys’ fees incurred by such
successful party or parties (including, without limitation, such costs,
expenses, and fees on any appeals), and if such successful party or parties
shall recover judgment in any such action or proceedings, such costs, expenses,
and attorneys’ fees shall be included as part of such judgment.

 

[Signature page follows:]

 

   

   

 

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

 

  PAVMED INC.         By: /s/ Ronald M. Sparks   Name:  Ronald M. Sparks  
Title: Chairman of Compensation Committee           /s/ Lishan Aklog, M.D.    
Lishan Aklog, M.D.