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Exhibit 10.18

October 28, 2019

 

Mr. Tom Wilkinson

Via E-mail Delivery

 

Re: Employment Agreement

 

Dear Tom:

 

This letter agreement (the “Agreement”) confirms the terms of your employment
with Sonim

Technologies, Inc. (the “Company” or “Sonim”).

 

1.         Position and Duties. Beginning on October 29, 2019 (your “Start
Date”), you will serve as the Company’s Chief Executive Officer (the “CEO”),
reporting to the Company’s Board of Directors (the “Board”). You will also serve
as a member of the Company’s Board. You will work primarily at your office in
Austin, TX but may be required to work out of the Company’s office in San Mateo,
CA from time to time when required by the Company. Of course, Sonim may change
your position, duties, and work location from time to time, as it deems
necessary. You will devote your full business time and attention to the business
affairs of the Company, except for reasonable vacations and periods of illness
or incapacity. Notwithstanding the foregoing, you will be permitted to continue
as Interim CEO for Cipherloc Corporation through November 30, 2019, and to serve
on the Board of Directors of the following three entities: (1) Astrotech; (2)
Cipherloc; and (3) FourBurner Services. You must obtain approval from the
Company’s Board prior to your membership as a member of the Board of Directors
of any other entity. As a Sonim employee, you will be expected to abide by
Company rules and policies and to acknowledge in writing that you have read the
Company’s Employee handbook.

 

2.Compensation and Benefits.

 

(a)       Base Salary. You will receive a base salary of $400,000 per year, less
required and designated payroll deductions and withholdings, and payable
according to the Company’s regular payroll schedule. Your annual base salary
will be reviewed from time to time and is subject to change at the discretion of
the Board. Salary will begin on November 1, 2019.

 

(b)       Benefits. You will be eligible to participate in the Company’s
standard employee benefits pursuant to the terms, conditions and limitations of
the applicable benefit plans. The Company will fund up to $15,000 per year for
your participation in World Presidents Organization activities, following
submission of invoices or receipts for any such expenses. In addition, the
Company will provide you with a monthly $2,000 stipend through July 2020 to
assist you in maintaining an office space in Austin, TX. In the event of the
consummation of a Change in Control, the Company will use its reasonable best
efforts to ensure that the benefits provided to you following the Change in
Control (assuming your employment continues) will be equal to or greater than
the benefits provided to you as of the date of this Agreement.

 

(c)       Cash Bonus Plan. Beginning with the Company’s 2020 fiscal year, as a
member of senior management of the Company, you will be eligible to participate
under the Company’s Cash Bonus Plan, the current terms of which are set forth on
Exhibit A attached hereto.

 

(d)       Discretionary Bonus. You will be eligible to receive a bonus based on
the achievement of specific initiatives that create incremental value the
Company, when such specific initiatives are set forth by the Board. There is no
guarantee that any specific initiatives for which you may receive a bonus will
be developed at any time. Any specific initiatives for which you may be eligible
to receive a bonus will be developed by the Board and communicated to you in
writing. Any determination as to whether the specific initiatives are achieved
and the amount of any bonus earned as a result of the

 

 

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achievement of specific initiatives is determined by the Board in its sole
discretion. Any bonus shall be paid within thirty (30) days after the Board’s
determination that a bonus shall be awarded. You must be employed on the day
that your bonus (if any) is paid in order to earn the bonus. Therefore, if your
employment is terminated either by you or the Company for any reason prior to
the bonus being paid, you will not have earned the bonus and no partial or
prorated bonus will be paid.

 

(e)       Equity Incentive Compensation. Subject to approval by the Board, at
the first Board meeting following the Start Date, the Company will grant you an
option to purchase 200,000 shares of the Company’s common stock (the “Option”).
The Option shall vest over a four-year period, with one quarter (1/4) of the
shares subject to the Option vesting on the one year anniversary of the date of
grant, and 1/48th   of the shares  vesting in equal monthly installments
thereafter, subject to your continued service to the Company. The Option shall
be issued pursuant to the terms and conditions of the Company’s 2012 Equity
Incentive Plan (the “Plan”), at an exercise price equal to 100% of the fair
market value of the Company’s common stock on the date of grant, as provided in
the Plan and consistent with the requirements for an exemption from the
application of Section 409A of the Internal Revenue Code (the “Code”), and shall
be governed in all respects by the terms of the Plan, the grant notices and the
option agreements. In addition, you may be eligible for additional annual equity
grants as determined annually by the Board in its sole discretion. The terms of
any such additional grants will be governed by the Plan and the applicable grant
notices and options agreements.

 

(f)         Transaction Bonus. The Company will develop a bonus program in which
you will be eligible to participate, to incentivize and reward senior managers
of the Company in the event of a Change in Control (as defined below) of the
Company during a timeframe (the “Term”) to be established by the Company (a
“Transaction”), subject to your continued employment at the completion of the
Transaction (and with protection for terminations without Cause (as defined
below) or resignations for Good Reason (as defined below) after the signing and
before completion of a Transaction). Upon the completion of a Transaction during
the Term, a bonus pool (the “Transaction Bonus Pool”) shall be established in an
amount that is equal to ten percent (10%) of the consideration payable to
Company stockholders in such Transaction after deducting the transaction
expenses. You will have a 50% interest in such Transaction Bonus Pool, and the
Board, in consultation with you, shall determine which other members of the
Company’s senior management team shall be eligible to participate in the
Transaction Bonus Pool and the percentage of the Transaction Bonus Pool that
shall be awarded to each.

 

3.         Proprietary Information Agreement and Company Policies. As a
condition of your employment, you must sign and abide by the Company’s standard
for of Employment, Confidential Information and Invention Assignment Agreement
(the “Proprietary Information Agreement”), a copy of which is attached hereto as
Exhibit B. In your work for the Company, you will be expected not to use or
disclose any confidential information, including trade secrets, of any former
employer or other person to whom you have an obligation of confidentiality.
Rather, you will be expected to use only that information which is generally
known and used by persons with training and experience comparable to your own,
which is common knowledge in the industry or otherwise legally in the public
domain, or which is otherwise provided or developed by the Company. You agree
that you will not bring onto Company premises any unpublished documents or
property belonging to any former employer or other person to whom you have an
obligation of confidentiality. You hereby represent that your employment does
not create a conflict with any agreement between you and a third-party.

 

4.         No Conflicts. During the term of your employment with the Company,
except on behalf of the Company, you agree not to directly or indirectly,
whether as an officer, director, employee, stockholder, partner, proprietor,
associate, representative, consultant, agent, or in any capacity whatsoever,
engage in, become financially interested in, be employed by or have any business

 

 

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connection with any other person, corporation, firm, partnership or other entity
whatsoever which is known by you to compete directly with the Company,
throughout the world, in any line of business engaged in (or planned to be
engaged in) by the Company; provided, however, that you may own, as a passive
investor, securities of any publicly-held competitor corporation, so long as
your direct holdings in any one such corporation shall not in the aggregate
constitute more than 1% of the voting stock of such corporation.

 

5.         At-Will Employment Relationship; Board Resignation. Your employment
relationship is at will, meaning either you or the Company may terminate your
employment relationship at any time, with or without Cause, and with or without
advance notice. In addition, the Company may modify the other terms and
conditions of your employment, including, but not limited to, compensation,
benefits, position, title, reporting relationship and office location, from time
to time in its sole discretion. Your at-will employment relationship can only
be  changed in  a written agreement signed by you  and a duly authorized member
of the Board. If you cease serving as the Company’s CEO for any reason, you
agree that this Agreement constitutes your resignation from the Board as of the
date of such cessation of service.

 

6.Severance Benefits.

 

(a)       Termination by the Company without Cause; Termination Due to Death or
Disability; Resignation for Good Reason, Prior to a Change in Control. If at any
time prior to a Change in Control, or more than thirteen (13) months after a
Change in Control, the Company terminates your employment without Cause,
or  your employment terminates due to  your death or  permanent disability, or
you resign for Good Reason, and provided such termination constitutes a
“separation from service” (as defined under Treasury Regulation Section
1.409A-1(h), without regard to any alternative definition thereunder, a
“Separation from Service”), and if such termination occurs more than 90 days
after your Start Date, then subject to your obligations below, the Company will
provide you the following severance benefits:

 

(i)         the Company will make severance payments to you in the form of
salary continuation payments for a period of twelve (12) months at the rate of
your base salary in effect as of your termination date, less required and
designated payroll deductions and withholdings; and

 

(ii)       if you timely elect continued health insurance coverage under COBRA,
the Company will reimburse you the cost of your COBRA premiums to continue your
coverage (including coverage for eligible dependents, if applicable) (“COBRA
Premiums”) through the period (the “COBRA Premium Period”) starting on the
Separation Date and ending on the earliest to occur of: (x) twelve (12) months
after your termination (y) the date you become eligible for group health
insurance coverage through a new employer; or (z) the date you cease to be
eligible for COBRA continuation coverage for any reason, including plan
termination. In the event you become covered under another employer's group
health plan or otherwise cease to be eligible for COBRA during the COBRA Premium
Period, you must immediately notify the Company in writing of such event.

 

(b)       Termination by the Company without Cause; Resignation for Good Reason,
Following a Change in Control. If at any time within thirteen (13) months after
a Change in Control, the Company terminates your employment without Cause, or
you resign for Good Reason, and provided such termination constitutes a
Separation from Service, then subject to your obligations below, the Company
will provide you with the following severance benefits:

 

 

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(i)      continuation payments for a period of eighteen (18) months at the rate
of your base salary in effect as of your termination date, less required and
designated payroll deductions and withholdings;

 

(ii)       if you timely elect continued health insurance coverage under COBRA,
the Company will reimburse you for your COBRA Premiums through the period (the
“CIC COBRA Premium Period”) starting on the Separation Date and ending on the
earliest to occur of: (x) eighteen (18) months after your termination (y) the
date you become eligible for group health insurance coverage through a new
employer; or (z) the date you cease to be eligible for COBRA continuation
coverage for any reason, including plan termination. In the event you become
covered under another employer's group health plan or otherwise cease to be
eligible for COBRA during the CIC COBRA Premium Period, you must immediately
notify the Company in writing of such event; and

 

(iii)       Notwithstanding the terms of the Company’s Cash Bonus Plan that
require your continued employment through the determination date of payment of
an earned cash bonus, you will be entitled to receive 150% of your Target Bonus
for the year of your termination based on full achievement (but no
over-achievement) of the Company’s performance targets then in effect under the
Cash Bonus Plan.

 

(iv)     the vesting of any then-outstanding stock options/awards as of your
termination date shall be accelerated in full as of your termination date.

 

(v)       For purposes of clarity, if you receive severance benefits under this
section 6(b), you shall not be eligible for severance benefits under section
6(a).

 

(c)       The severance benefits described above are conditional upon (a) your
continuing to comply with your obligations under your Proprietary Information
Agreement, including the non- competition and non-solicitation provisions
thereof; (b) your delivering to the Company an effective, general release of
claims in favor of the Company in a form acceptable to the Company within 30
days following your Separation from Service; and (d) if requested by the Company
to confirm your Board resignation pursuant to Section 5 of this Agreement, if
you are a member of the Board, your resignation from the Board, to be effective
no later than the date of your termination date (or such other date as requested
by the Board). The salary continuation payments will be paid in equal
installments on the Company’s regular payroll schedule and will be subject to
applicable tax withholdings over the period outlined above following the date of
your Separation from Service; provided, however, that no payments will be made
prior to the 30th day following your Separation from Service. On the 30th day
following your Separation from Service, the Company will pay you in a lump sum
the salary continuation payments that you would have received on or prior to
such date under the original schedule but for the delay while waiting for the
30th day in compliance with Section 409A of the Internal Revenue Code of 1986,
as amended (the “Code”) and the effectiveness of the release, with the balance
of the salary continuation payments being paid as originally scheduled.

 

7.Definitions.

 

(a)       Cause. For purposes of this Agreement, “Cause” is defined as any of
the following: (i) your commission of any felony or any crime involving fraud,
dishonesty or moral turpitude under the laws of the United States, any state
thereof, or any applicable foreign jurisdiction; (ii) your attempted commission
of, or participation in, a fraud or act of dishonesty against the Company or any
affiliate of the Company; (iii) your intentional, material violation of any
contract or agreement between you and the Company or any affiliate of the
Company or of any statutory duty owed to the Company or any

 

 

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affiliate of the Company; (iv) your unauthorized use or disclosure of the
Company’s or any affiliate of the Company’s confidential information or trade
secrets; or (v) your gross misconduct. The determination that a termination of
your employment is either for Cause or without Cause shall be made by the
Company in its sole discretion.

 

(b)       Change in Control. For purposes of this Agreement, the definition of a
“Change in Control” is as defined in section 13(i) of the Company’s 2019 Equity
Incentive Plan (as in effect on the date hereof).

 

(c)       Good Reason. For purposes of this Agreement, you will have “Good
Reason” for your resignation from your employment with the Company if any of the
following actions are taken by the Company without your express written consent:

 

(i)       any failure by the Company to pay, or any material reduction by the
Company of (a) your base salary in effect immediately prior to such failure to
pay or reduction (unless reductions comparable in amount and duration are
concurrently made generally for employees of the Company with responsibilities,
organizational level and title comparable to your own), or (b) your bonus
compensation amount eligibility, if any, in effect immediately prior to the date
of such failure to pay or such reduction (subject to applicable performance
requirements with respect to the actual amount of bonus compensation you earn);

 

(ii)       the assignment of any duties, or the reduction of your
responsibilities or duties, that are materially inconsistent with your position,
duties, responsibilities and status with the Company immediately prior to such
assignment or reduction; provided, however, that your assignment to an operating
division of an acquiring company that includes the business of the Company
following an acquisition, pursuant to which your duties are commensurate with
the duties you had before the acquisition, except that the business of the
Company is no longer independent but contained in a division, shall not be
deemed a material reduction of your responsibilities, duties, or status
hereunder and your resignation in connection therewith shall not be deemed for
“Good Reason;” or

 

(iii)       the relocation of your principal place of employment to a location
that is more than fifty (50) miles from your then-current Board-approved place
of work;

 

provided, however, that to resign for Good Reason, you must (1) provide written
notice to the Company’s CFO within 30 days after the first occurrence of the
event giving rise to Good Reason setting forth the basis for your resignation,
(2) allow the Company at least 30 days from receipt of such written notice to
cure such event, and (3) if such event is not reasonably cured within such
period, your resignation from all positions you then hold with the Company and
its subsidiaries (including Board memberships) is effective not later than 90
days after the expiration of the cure period.

 

8.Code Section 409A. It is intended that all of the benefits and payments under
this

Agreement satisfy, to the greatest extent possible, the exemptions from the
application of Code Section

409A provided under Treasury Regulations 1.409A-1(b)(4), 1.409A-1(b)(5) and
1.409A-1(b)(9), and this Agreement will be construed to the greatest extent
possible as consistent with those provisions. If not so exempt, this Agreement
(and any definitions hereunder) will be construed in a manner that complies with
Code Section 409A and incorporates by reference all required definitions and
payment terms. For purposes of Code Section 409A (including, without limitation,
for purposes of Treasury Regulation Section

1.409A-2(b)(2)(iii)), your right to receive any installment payments under this
Agreement (whether severance payments, reimbursements or otherwise) will be
treated as a right to receive a series of separate payments and, accordingly,
each installment payment hereunder will at all times be considered

 

 

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a separate and distinct payment. Notwithstanding any provision to the contrary
in this Agreement, if you are deemed by the Company at the time of your
Separation from Service to be a “specified employee” for purposes of Code
Section 409A(a)(2)(B)(i), and if any of the payments upon Separation from
Service set forth herein and/or under any other agreement with the Company are
deemed to be “deferred compensation”, then if delayed commencement of any
portion of such payments is required to avoid a
prohibited  distribution  under  Code  Section  409A(a)(2)(B)(i)  and  the  related  adverse  taxation  under
Section 409A, the timing of the payments upon a Separation from Service will be
delayed as follows: on the earlier to occur of (i) the date that is six months
and one day after the effective date of your Separation from Service, and (ii)
the date of the your death (such earlier date, the “Delayed Initial Payment
Date”), the Company will (A) pay to you a lump sum amount equal to the sum of
the payments upon Separation from Service that  you would
otherwise  have  received through the  Delayed Initial Payment Date if the
commencement of the payments had not been delayed pursuant to this paragraph,
and (B) commence paying the balance of the payments in accordance with the
applicable payment schedules set forth above. No interest will be due on any
amounts so deferred.

 

9.         Entire Agreement. This Agreement, including Exhibit A and Exhibit B,
constitutes the complete, final and exclusive embodiment of the entire agreement
between you and the Company with respect to the terms and conditions of your
employment. If you enter into this Agreement, you are doing so voluntarily, and
without reliance on any promise, warranty, representation or agreement, written
or oral, other than those expressly contained herein. This Agreement supersedes
any and all promises, warranties, representations or agreements, whether oral or
written, including the Offer Letter. This Agreement may not be amended or
modified except by a written instrument signed by you and a duly authorized
member of the Board.

 

10.     Enforceability. If any provision of this Agreement is determined to be
invalid or unenforceable, in whole or in part, this determination will not
affect any other provision of this Agreement,
and  the  Agreement,  including  the  invalid  or unenforceable provisions,
shall be enforced insofar as possible to achieve the intent of the parties.

 

11.       Binding Nature. This Agreement will be binding upon and inure to the
benefit of the personal representatives and successors of the respective parties
hereto.

 

12.       Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the State of California without regard to conflicts
of law principles.

 

13.       Miscellaneous. With respect to the enforcement of this Agreement, no
waiver of any right hereunder shall be effective unless it is in writing. For
purposes of construction of this Agreement, any ambiguity shall not be construed
against either party as the drafter. This Agreement may be executed in more than
one counterpart, and signatures transmitted via facsimile shall be deemed
equivalent to originals.

 

 

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If these revised terms of your employment with Sonim are acceptable to you,
please sign this Agreement and return it to me.

 

 

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EXHIBIT A: CASH BONUS PLAN

 

 

 

A.

Subject to the discretion of the Board of Directors of the Company (the
“Board”), you will be eligible for an annual Bonus that will be based upon
performance targets set by the Board:

 

 

 

 

 

2020 and beyond

 

100% of Annual Salary

 

 

 

B.

The Board will determine the actual bonus to which you are entitled each year
using a formula mutually agreed upon at the beginning of each year.

 

 

 

C.

The Company’s performance against targets for each year shall be approved by the
Board as soon as practicable following completion of the respective year-end
audit (the date of such determination, the “Determination Date”).   The
Company’s performance against targets for a year in which a Change in Control
occurs shall be determined without taking into consideration any costs
associated with the Change in Control that affect the Company’s financial
results for that year.

 

 

 

D.

If approved, bonus payments will be made annually and in accordance with
Company’s standard policies and procedures. Payment shall be conditioned on (1)
you being in the Company’s continuous service through the relevant year’s
Determination Date and (2) Sonim maintaining an agreed upon minimum cash balance
at the end of the fiscal quarter immediately preceding the respective
Determination Date. In the event any approved bonus amounts are not paid
pursuant to the foregoing subsection (2), such amounts shall be paid to you when
and if Sonim achieves the cash balance, at which time you must be in the
Company’s continuous service to earn and receive such bonus payment.