Exhibit 10.95

  

EXECUTIVE EMPLOYMENT AGREEMENT

 

This EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement"), effective as of May 14,
2019, (the "Effective Date"), is made and entered into by and between CUI
GLOBAL, INC., a Colorado corporation (the "Company"), and WILLIAM J. CLOUGH,
Chief Executive Officer, President and General Counsel (the "Executive").

 

WITNESSETH:

 

WHEREAS, the Executive is currently and shall continue to be employed as the
Company's Chief Executive Officer, President and General Counsel as well as the
Chief Executive Officer of the Company’s wholly owned subsidiaries, CUI Global
Holdings, Inc. and Orbital Systems, Ltd. and has made, and is expected to
continue to make, major contributions to the Company and its subsidiaries
strategic short and long-term goals, growth, and financial strength of the
Company; and

 

WHEREAS, the Company has determined that appropriate arrangements should be
taken to encourage the continued attention and dedication of the Executive to
his assigned duties without distraction; and

 

WHEREAS, in consideration of the Executive's past and continued employment with
the Company, the Company desires to provide the Executive with certain
compensation and benefits as set forth in this Agreement; and

 

WHEREAS, the Executive is agreeable to the Restrictive Covenants, which is in
the best interests of the Company and its shareholders as part of this
Agreement; and

 

WHEREAS, the Compensation Committee has determined that entering into this
Agreement is in the best interests of the Company and its shareholders.

 

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements hereinafter set forth and intending to be legally bound hereby, the
Company and the Executive agree as follows:

 

1.           Duties of Executive; Employment Rights; Terms.

 

(a)     Duties of Executive. The duties of Executive shall be those that are
commensurate with the position of Chief Executive Officer, President and General
Counsel of a corporation, and such duties shall be rendered at the Company's
office and at such other place or places as the Company shall in good faith
require or as the interest, needs, business, or opportunity of the Company shall
require. Executive agrees that Executive will at all times faithfully,
industriously , and to the best of Executive's ability, experience, and talents,
perform all of the services and duties that may be required of and from
Executive pursuant to the terms hereof. Executive, shall during the term of his
employment hereunder, subject to control of the board of directors, have the
executive powers of the chief executive officer and exercise active management
and supervision over the business and affairs of the Company and its
subsidiaries and its several officers, and shall perform such executive and/or
administrative duties consistent with the offices of Chief Executive Officer,
President and General Counsel.

 

(b)     Employment Rights. Nothing expressed or implied in this Agreement shall
create any right or duty on the part of the Company or the Executive to have the
Executive remain in the employment of the Company or any subsidiary prior to or
following any Change in Control.

 

 

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2.           Executive Compensation.

 

(a)     Annual Base Compensation. Executive’s Annual Base Salary shall equal the
following amounts per annum:

 

 

Period

 

Amount

 

Year 1 (May 15, 2019 – May 14, 2020)

$750,000

 

Year 2 (May 15, 2020 – May 14, 2021)

$800,000

 

Year 3 (May 15, 2021 – May 14, 2022)

$850,000

 

 

The Annual Base Salary payable in periodic installments in accordance with the
Company’s customary payroll practices, but no less frequently than monthly. The
Executive’s Annual Base Salary shall be reviewed at least annually by the
Compensation Committee, and the Compensation Committee may, but shall not be
required to, increase the Executive’s Annual Base Salary. The Executive’s Annual
Base Salary shall not be reduced without the written consent of the Executive.

 

(b)     Future Bonuses. Executive shall be entitled to receive a minimum annual
bonus payment targeted at seventy-five percent (75%) of his Annual Base Salary
(“Target Bonus”). Said bonus shall be based on performance objectives, goals,
and milestones agreed to by the Executive and the Compensation Committee. Said
bonus shall also be based on the reasonable judgment of the Compensation
Committee. In addition, Executive shall be entitled to a discretionary bonus
targeted at twenty-five percent (25%) of his Annual Base Salary. In the event
Executive exceeds the stated goals and objectives, Executive shall have the
ability to earn a larger bonus based on the performance criteria set forth above
and the reasonable judgment and discretion of the Compensation Committee. The
parties acknowledge that the Company’s previous Equity Incentive Plan that was
approved by the Company’s shareholders, has expired. The Company intends to
submit a new Equity Incentive Plan for approval by its shareholders. Until an
Equity Incentive Plan is approved by the Company’s shareholders, any bonus
compensation payable to the Executive shall be in the form of cash. If and when
a new Equity Incentive Plan is approved by the Company’s shareholders, the
Executive shall have the right to have any bonuses paid in the form of
restricted stock units or other equity incentive arrangements provided for under
the proposed new Equity Incentive Plan. Any issuance of equity based
compensation to the Executive shall be consistent with the provisions of NASDAQ
Listing Rule 5635(c).

 

(c)     Stock Options. Executive shall be granted, subject to the restrictions
and understandings described below, options to acquire up to 1,600,000 shares of
the Company’s common stock at an exercise price equal to the closing price of
the Company’s common stock for the trading day immediately prior to the
Effective Date as reported on NASDAQ.COM. Such stock options shall vest in equal
monthly installments over thirty six (36) months commencing on May 15, 2019. The
options granted to Executive shall have a ten (10) year term from the Effective
Date. Said options shall have a cashless exercise provision and shall be subject
to full acceleration in the event of an involuntary termination of the Executive
by the Company for any reason other than Cause, death or disability or
termination of this Agreement by Executive for Good Reason. Notwithstanding the
foregoing, the Executive and the Company understand that the issuance of these
options is subject to shareholder approval of an equity incentive plan of which
the Executive is entitled to participate. If shareholders do not approve an
equity incentive plan which includes the options issued to the Executive
hereunder within one (1) year of the date of this Agreement, then the Executive
agrees that he shall forfeit all right, title and interest in and to these
options. No options may be exercised by Executive prior to the latter of (i) six
months from the Effective date or (ii) shareholder approval of an equity
incentive plan, which includes these options issued to Executive. The issuance
of these options shall be subject to NASDAQ Listing Rule 5635(c). The options
shall be further evidenced by a stock option agreement, substantially in the
form attached hereto as Annex A, and shall be subject to the provisions as
contemplated by the future equity incentive plan. A form of the Option to
Purchase Common Stock is set forth as Annex A.

 

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(d)     PTO (Paid Time Off). Executive may take up to four (4) weeks of paid PTO
in each calendar year at in accordance with the terms and conditions of such PTO
policies generally applicable to Company's executive employees.

 

(e)     Reimbursement of Expenses. During the term hereof, Executive shall be
entitled to reimbursement for all normal and reasonable expenses necessarily
incurred by Executive in the performance of his obligations hereunder, subject
to such substantiation requirements as may be imposed by the Company.

 

(f)     Other Benefits. Executive shall be entitled to participate in any other
group hospitalization, health, dental care or sick-leave plan, life or other
insurance or death benefit plan, travel or accident insurance, or executive
contingent compensation plan, including, without limitation, stock option plan,
retirement, income or pension plans, or other present or future group employee
benefit plans, programs or arrangements of the Company for which executives are
or shall become eligible, and Executive shall be eligible to receive during the
term of this Agreement all benefits for which executives are eligible under
every such plan, program or arrangement to the extent permissible under the
general terms and provisions of such plans, programs or arrangements and in
accordance with the provisions thereof.

 

(g)     Life Insurance. The Company shall pay up to a $9,999 per year annual
premium for a life insurance policy with a face amount equal to one (1) year’s
salary plus the Target Bonus, which names the Executive’s wife as the sole
beneficiary. Any premiums above $9,999 are the responsibility of the Executive.

 

(h)     Past Bonuses. If Executive’s employment with the Company terminates for
any reason other than Cause, any bonus amounts previously approved by the
Compensation Committee but not yet paid to Executive shall be payable to the
Executive within sixty (60) days of the Termination Date and require no further
actions or approvals.

 

3.           Involuntary Termination or Resignation for Good Reason.

 

(a)     Payments/Benefits. In no event will the Company involuntarily terminate
the Executive’s employment for any reason other than death, disability or Cause
for a period of one (1) year after the occurrence of a Change in Control event.
In the event of: (i) an involuntary termination of Executive's employment by the
Company for any reason other than Cause, death, or Disability, or (ii)
Executive's resignation for Good Reason, Executive shall be entitled to the
following benefits:

 

(i)     2.5 times the sum of Annual Base Salary and Target Bonus, paid in a
single lump sum cash payment on or before the sixtieth (60th) day following
Executive's Termination Date. Annual Base Salary shall mean: Executive's Annual
Base Salary immediately prior to Executive’s Termination Date. Target Bonus
shall mean Executive's Target Bonus immediately prior to Executive's Termination
Date.

 

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(ii)     For a period of up to eighteen (18) months following Executive's
Termination Date, Executive and, where applicable, Executive's spouse and
eligible dependents, will continue to be eligible to receive medical coverage
under the Company's medical plans in accordance with the terms of the applicable
plan documents; provided, however, that in order to receive such continued
coverage at such rates, Executive will be required to pay the applicable
premiums directly to the plan provider, and the Company will reimburse the
Executive, within thirty (30) days following the date such monthly premium
payment is due, an amount equal to the monthly COBRA premium payment, less
applicable tax withholdings. Notwithstanding the foregoing, if Executive obtains
full-time employment during the aforementioned eighteen (18) month period which
employment entitles him and his spouse and eligible dependents to comprehensive
medical coverage, Executive must immediately notify the Company in writing and
no further reimbursements will be paid by the Company to the Executive pursuant
to this subsection. In addition, if Executive does not pay the applicable
monthly COBRA premium for a particular month at any time during the eighteen
(18) month period and coverage is lost as a result, no further reimbursements
will be paid by the Company to the Executive. Notwithstanding the foregoing, if
the Company determines, in its sole discretion, that it cannot provide the
foregoing COBRA benefits without potentially violating applicable law
(including, without limitation, Section 2716 of the Public Health Service Act),
the Company shall in lieu thereof provide to Executive a taxable lump sum
payment in an amount equal to the monthly (or then remaining) COBRA premium that
Executive would be required to pay to continue his group health coverage in
effect on the Termination Date (which amount shall be based on the premium for
the first month of COBRA coverage). The payment of any tax relating to such
lump-sum payment shall be the sole responsibility of Executive

 

(iii)     Executive shall receive any amounts earned, accrued or owing but not
yet paid to Executive as of his Termination Date, payable in a lump sum, and any
benefits accrued or earned in accordance with the terms of any applicable
benefit plans and programs of the Company on or before the sixtieth (60th) day
following Executive’s Termination Date.

 

(iv)     All unvested stock options, issued to Executive shall immediately vest
in full, and shall be exercisable at any time prior to such instruments stated
expiration date.

 

(v)     Any deferred past bonuses that have been earned but not paid shall be
payable in a lump sum on or before the sixtieth (60th) day following Executive’s
Termination Date.

 

4.            Termination of Employment on Account of Disability, Death, Cause
or Voluntarily Without Good Reason.

 

(a)     Termination on Account of Disability. Notwithstanding anything in this
Agreement to the contrary, if Executive's employment terminates on account of
Executive's Disability, Executive shall be entitled to receive (i) 75% of his
then current Annual Base Salary for six (6) months payable over such six (6)
month period, and (ii) disability benefits under any disability program
maintained by the Company that covers Executive, and Executive shall not receive
benefits pursuant to Section 3 hereof, except that, subject to the provisions of
Section 6 hereof, the Executive shall be entitled to the following benefits
provided that Executive executes and does not revoke the Release: For a period
of up to eighteen (18) months following Executive's Termination Date, Executive
and where applicable, Executive's spouse and eligible dependents, will continue
to be eligible to receive medical coverage under the Company's medical plans in
accordance with the terms of the applicable plan documents; provided, however,
that in order to receive such continued coverage at such rates, Executive will
be required to pay the applicable premiums directly to the plan provider, and
the Company will reimburse the Executive, within thirty (30) days following the
date such monthly premium payment is due, an amount equal to the monthly COBRA
premium payment, less applicable tax withholdings. Notwithstanding the
foregoing, if Executive obtains full-time employment during the aforementioned
eighteen (18) month period that entitles him and his spouse and eligible
dependents to comprehensive medical coverage, Executive must immediately notify
the Company in writing and no further reimbursements will be paid by the Company
to the Executive pursuant to this subsection (i) of Section 4(a). In addition,
if Executive does not pay the applicable monthly COBRA premium for a particular
month at any time during the eighteen (18) month period and coverage is lost as
a result, no further reimbursements will be paid by the Company to the Executive
pursuant to this subsection (i) of Section 4(a). Notwithstanding the above, if
the Company determines in its sole discretion that it cannot provide the
foregoing COBRA benefits without potentially violating applicable law
(including, without limitation, Section 2716 of the Public Health Service Act),
the Company shall in lieu thereof provide to Executive a taxable lump-sum
payment in an amount equal to the monthly (or then remaining) COBRA premium that
Executive would be required to pay to continue his group health coverage in
effect on the Termination Date (which amount shall be based on the premium for
the first month of COBRA coverage). The payment of any tax relating to such
lump- sum payment shall be the sole responsibility of Executive.

 

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(b)     Termination on Account of Death. Notwithstanding anything in this
Agreement to the contrary, if Executive's employment terminates on account of
Executive's death, Executive shall be entitled to receive death benefits under
any death benefit program maintained by the Company that covers Executive, and
Executive not receive benefits pursuant to Sections 3 hereof.

 

(c)     Termination on Account of Cause. Notwithstanding anything in this
Agreement to the contrary, if Executive's employment terminates by the Company
on account of Cause, Executive shall not receive benefits pursuant to Sections 3
hereof and all unvested options or other equity compensation interests shall be
immediately forfeited.

 

(d)     Termination on Account of Voluntary Resignation Without Good Reason.
Notwithstanding anything in this Agreement to the contrary, if Executive's
employment terminates on account of a resignation by Executive for no reason or
any reason other than on account of Good Reason, Executive shall not receive
benefits pursuant to Sections 3 hereof.

 

(e)     Options and Other Equity Compensation Interests. Notwithstanding the
foregoing, Executive, his estate or legal representation shall be entitled to
all rights that are provided to Executive under under any stock options,
restricted stock or other equity compensation arrangements through the
expiration date for such instruments in the event of death, disability or
termination of employment without Cause by the Company.

 

5.           [Reserved]

 

6.          Release. Notwithstanding the foregoing, no payments or other
benefits under this Agreement shall be made to Executive unless Executive
executes, and does not revoke, the Company's standard written release,
substantially in the form as attached hereto as Annex “B” (the "Release"), of
any and all claims against the Company and all related parties with respect to
all matters arising out of Executive's employment with the Company (other than
entitlements under the terms of this Agreement or under any other plans or
programs of the Company in which Executive participated and under which
Executive has accrued or become entitled to a benefit) or a termination thereof,
with such release being effective not later than sixty (60) days following
Executive's Termination Date.

 

7.          No Mitigation Obligation. Except as otherwise provided herein,
Executive shall not be required to mitigate the amount of any payment or benefit
provided for in this Agreement by seeking other employment or otherwise, nor
shall the amount of any payment or benefit provided for herein be reduced by any
compensation earned by other employment or otherwise.

 

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8.          Term of Agreement. This Agreement shall continue in full force and
effect until the third (3rd) anniversary of the Effective Date (the "Initial
Term"). This Agreement may be extended following the Initial Term (or any
successor, extended, or renewal term, (a "Renewal Term")) by mutual written
consent of the Company and Executive within ninety (90) days prior to the
expiration of the Initial Term or any Renewal Term; provided, however, that
within the ninety (90) day period prior to the expiration of the Initial Term or
any Renewal Term, at its discretion, the Compensation Committee or the Board may
propose for consideration by Executive, such amendments to the Agreement as it
deems appropriate. If Executive's employment with the Company terminates during
the Initial Term or a Renewal Term, this Agreement shall remain in effect until
all of the obligations of the parties hereunder are satisfied or have expired.

 

9.          Certain Defined Terms. In addition to terms defined elsewhere
herein, the following terms have the following meanings when used in this
Agreement with initial capital letters:

 

(a)     "Annual Base Salary" means the Executive's annual base salary, exclusive
of bonuses, commissions, and other incentive pay, as in effect immediately
preceding Executive's Termination Date. For informational purposes, as of the
Effective Date, Executive's Annual Base Salary is $750,000.00.

 

(b)     "Board" means the Board of Directors of the Company.

 

(c)     "Change in Control" means:

 

(i)     any persons or entities becoming the beneficial owners, directly or
indirectly, of securities of the Company representing greater than fifty percent
(50%) of the total voting power of all of the Company's then outstanding voting
securities in one or a series of related transactions;

 

(ii)     a merger or consolidation of the Company in which the Company's voting
securities immediately prior to such merger or consolidation do not represent,
or are not converted into securities that represent, a majority of the voting
power of all voting securities of the surviving entity immediately following the
merger or consolidation;

 

(iii)     a sale of substantially all of the assets of the Company or a
liquidation or dissolution of the Company; or

 

(iv)     individuals who, as of the date of execution of this Agreement,
constitute the Board (the "Incumbent Board") cease for any reason to constitute
at least a majority of such Board; provided, however, that any individual who
becomes a director of the Company subsequent to the date of execution of this
Agreement, whose election, or nomination for election by the Company's
stockholders, was approved by the vote of at least a majority of the directors
then in office shall be deemed a member of the Incumbent Board.

 

(d)     "Cause" means:

 

(i)     Executive’s final conviction by a court of competent jurisdiction for
fraud, misappropriation or embezzlement;

 

(ii)     Executive’s material breach of this Agreement or serious, willful gross
misconduct or willful gross neglect of duties (other than any such neglect
resulting from Executive’s incapacity due to physical or mental illness or
Disability or any such neglect after the issuance of a notice of termination by
Executive for Good Reason), which breach or conduct is not cured or corrected by
Executive within thirty (30) days of receiving written notice thereof from the
Company; or

 

(iii)     Executive’s material breach of any written policy of the Company,
including but not limited to the Code of Ethics for the Chief Executive Officer
and Senior Financial Officers, which breach is not cured or corrected by
Executive within thirty (30) days of receiving written notice thereof from the
Company.

 

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(e)     "COBRA" means the Consolidated Omnibus Budget Reconciliation Act of
1986, as amended.

 

(f)     "Compensation Committee" shall mean committee of the Board appointed in
accordance with related listing requirements of NASDAQ, NYSE, AMEX or other
exchange in which the Company’s securities are listed.

 

(g)     "Disability" means (i) the Executive's incapacity by bodily injury,
illness, or disease so as to prevent Executive from engaging in the performance
of the Executive's duties (provided, however, that the Company acknowledges its
obligations to provide reasonable accommodation to the extent required by
applicable law); (ii) such incapacity shall have continued for a period of six
(6) consecutive months; and (iii) such incapacity will, in the opinion of a
qualified physician to be selected by the Company, be permanent and continuous
during the remainder of the Executive's life.

 

(h)     "Good Reason" means

 

(i)     a material diminution in the Executive's base compensation or target
bonus below the amount as of the date of this Agreement, or as increased during
the course of Executive's employment with the Company, excluding one or more
reductions (totaling no more than twenty percent (20%) in the aggregate)
generally applicable to all senior executives; or

 

(ii)     any action or inaction that constitutes a material breach by the
Company of this Agreement; provided, however, that for the Executive to be able
to terminate his employment with the Company on account of Good Reason,
Executive must provide notice of the occurrence of the event constituting Good
Reason and his desire to terminate his employment with the Company on account of
such within ninety (90) days following the initial existence of the condition
constituting Good Reason. Thereafter, the Company shall have a period of thirty
(30) days following receipt of such notice in which to cure the condition. If
the Company does not cure the event constituting Good Reason within such thirty
(30) day period, the Executive's Termination Date shall be the day immediately
following the end of such thirty (30) day period, unless the Company provides
for an earlier Termination Date.

 

(i)     "Termination Date" means the last day of Executive's employment with the
Company.

 

(j)     "Termination of Employment" means the termination of Executive's
employment relationship with the Company, for any reason.

 

10.          Tax Matters.

 

(a)     Withholding of Taxes. The Company may withhold from any amounts payable
under this Agreement all federal, state, city or other taxes as the Company is
required to withhold pursuant to any applicable law, regulation, or ruling.

 

(b)     Indemnity. If the Company breaches its covenant not to terminate the
Executive involuntarily for any reason other than death, disability or Cause
within one (1) year of a Change in Control event, as set forth in Section 3(a),
then the Company shall indemnify the Executive for any taxes, penalties,
interests, fees and costs, including accounting and legal fees, grossed up for
any additional taxable income resulting from such indemnification that the
Executive incurs relating to any IRS determinations or proceedings that would
subject the Executive to assessment of the Excise Tax imposed by Section 4999 of
the Internal Revenue Code, or any comparable successor provision.

 

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11.          Section 409A of the Code.

 

(a)     Interpretation. Notwithstanding the other provisions hereof, this
Agreement is intended to comply with the requirements of Section 409A of the
Code, to the extent applicable, and this Agreement shall be interpreted to avoid
any penalty sanctions under Section 409A of the Code. Accordingly, all
provisions herein, or incorporated by reference, shall be construed and
interpreted to comply with Section 409A of the Code and, if necessary, any such
provision shall be deemed amended to comply with Section 409A of the Code and
regulations thereunder. If any payment or benefit cannot be provided or made at
the time specified herein without incurring sanctions under Section 409A of the
Code, then such benefit or payment shall be provided in full at the earliest
time thereafter when such sanctions will not be imposed. Any amount payable
under this Agreement that constitutes deferred compensation subject to Section
409A of the Code shall be paid at the time provided under this Agreement or such
other time as permitted under Section 409A of the Code. No interest will be
payable with respect to any amount paid within a time period permitted by, or
delayed because of, Section 409A of the Code. All payments to be made upon a
termination of Executive's employment under this Agreement that are deferred
compensation may only be made upon a "separation from service" under Section
409A of the Code. For purposes of Section 409A of the Code, each payment made
under this Agreement shall be treated as a separate payment. In no event may
Executive, directly or indirectly, designate the calendar year of payment.

 

(b)     Payment Delay. To the maximum extent permitted under Section 409A of the
Code, the severance benefits payable under this Agreement are intended to comply
with the "short- term deferral exception" under Treasury Regulation
§l.409A-l(b)(4), and any remaining amount is intended to comply with the
"separation pay exception" under Treasury Regulation §l.409A-1(b)(9)(iii);
provided , however, any amount payable to Executive during the six (6) month
period following Executive's Termination Date that does not qualify within
either of the foregoing exceptions and constitutes deferred compensation subject
to the requirements of Section 409A of the Code, then such amount shall
hereinafter be referred to as the "Excess Amount". If at the time of Executive's
separation from service, the Company's (or any entity required to be aggregated
with the Company under Section 409A of the Code) stock is publicly-traded on an
established securities market or otherwise and Executive is a "specified
employee" (as defined in Section 409A of the Code and determined in the sole
discretion of the Company (or any successor thereto) in accordance with the
Company's (or any successor thereto) "specified employee" determination policy),
then the Company shall postpone the commencement of the payment of the portion
of the Excess Amount that is payable within the six (6) month period following
Executive's Termination Date with the Company (or any successor thereto) for six
(6) months following Executive's Termination Date with the Company (or any
successor thereto). The delayed Excess Amount shall be paid in a lump sum to
Executive within ten (10) days following the date that is six (6) months
following Executive's Termination Date with the Company (or any successor
thereto). If Executive dies during such six (6) month period and prior to the
payment of the portion of the Excess Amount that is required to be delayed on
account of Section 409A of the Code, such Excess Amount shall be paid to the
personal representative of Executive's estate within sixty (60) days after
Executive's death.

 

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(c)     Reimbursements. All reimbursements provided under this Agreement shall
be made or provided in accordance with the requirements of Section 409A of the
Code, including, where applicable, the requirement that (i) any reimbursement is
for expenses incurred during Executive's lifetime (or during a shorter period of
time specified in this Agreement), (ii) the amount of expenses eligible for
reimbursement during a calendar year may not affect the expenses eligible for
reimbursement in any other calendar year, (iii) the reimbursement of an eligible
expense will be made on or before the last day of the taxable year following the
year in which the expense is incurred, and (iv) the right to reimbursement is
not subject to liquidation or exchange for another benefit. Any tax gross up
payments to be made hereunder shall be made not later than the end of
Executive's taxable year next following Executive's taxable year in which the
related taxes are remitted to the taxing authority.

 

12.          Restrictive Covenants.

 

(a)     Legitimate Business Interests. The Company is entitled to protection of
its legitimate business interests, and the parties agree that these interests
include without limitation: the Company's confidential business and professional
information; the Company's substantial relationships with existing or
prospective clients and customers, prospects and referral sources; the Company's
trade secrets; the Company's patented and unpatented technology and user
manuals; marketing plans; and business strategies. The parties further agree
that the Company has a legitimate business interest in its employees and
independent contractors who are an integral part of its business and a valuable
resource due to the Company's substantial investment in the training of its
employees and independent contractors. The parties further agree that the
Company has a legitimate business interest in client and referral source
goodwill associated with the marketing area in the United States. The parties
agree that the Restrictive Covenants in this Section 12 are reasonably necessary
to protect these legitimate business interests.

 

(b)     Non-Competition. Executive covenants and agrees that during the
Restricted Period, Executive will not directly or indirectly own, manage,
operate, control, be employed by, act as an agent for, participate in or be
connected in any manner with the ownership, management , operation or control of
any business which is engaged in businesses which are competitive to the
business of the Company. Executive agrees that this restrictive covenant shall
encompass the United States. For purposes of this Section 12(b), the term
"Restricted Period" shall mean the term of this Agreement (including any renewal
or extended terms), and for a period of twenty-four (24) months following
termination of this Agreement or termination of Executive's relationship with
the Company, for any reason.

 

(c)     Non-Solicitation.

 

(i)     Non-Solicitation of Customers/Clients. Executive covenants and agrees
that during the Restricted Period, Executive shall not, directly or indirectly,
on behalf of himself or through another person or entity, solicit, induce,
entice, divert, take away or interfere with or attempt to do any of the
foregoing with respect to, or trade of or trade with, any Customer of the
Company on behalf of a competing business. The term "Customer" shall include,
without limitation, any client, customer, supplier, consultant, advisor, or
contractor of the Company, as well as those current and prospective persons or
entities having a business relationship with the Company during the term of
Executive's employment or at the time of Executive's solicitation, inducement,
enticement, diversion, take away or interference (or attempt) or at any time
within the twenty-four (24) month period prior to such action by Executive. For
purposes of this Section 12(c), the term "Restricted Period" shall mean the term
of this Agreement (including any renewal or extended terms), and for a period of
twenty-four (24) months following termination of this Agreement or termination
of Executive's relationship with the Company for any reason.

 

(ii)     Non-Solicitation of Employees. Executive covenants and agrees that
during the Restricted Period, he shall not, directly or indirectly, solicit or
induce or attempt to solicit or induce, initiate or have contact with any
employee of the Company for the purpose of persuading them to leave the employ
of the Company for any reason whatsoever, or offer such employee employment with
anyone or otherwise hire or engage the services of any employee of the Company.

 

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(d)     Intellectual Property; Work for Hire. The following provisions shall
apply with respect to the Company's Intellectual Property (as defined below):

 

(i)     Executive has disclosed and will continue to disclose promptly to the
Company all Intellectual Property made, conceived, created, discovered, reduced
to practice or learned by Executive, either alone or jointly with others, during
the term of this Agreement, including the period preceding the execution of this
Agreement during which services may have been provided by Executive. As used in
this Agreement, "Intellectual Property" means all intellectual property,
including all Works (including all works of authorship), computer programs,
methods, systems, processes, formulae, data, functional specifications,
know-how, improvements, inventions, discoveries, developments, techniques,
licenses, Confidential Information and all information relating thereto,
patents, patent applications, copyrights, moral rights, trademarks, trade names,
service marks and trade dress, in each case whether or not patentable,
registrable under copyright or similar statutes, or subject to analogous
protection.

 

(ii)     All Works which are or may be protected by a copyright, are works made
for hire within the meaning of applicable copyright laws and are the sole
property of the Company. For purposes of this Agreement, "Works" means all
subject matter invented, conceived, developed, created or enhanced by Executive
in connection with the Company's Intellectual Property or while performing
services prior to or during the term of this Agreement.

 

(iii)     All Intellectual Property that Executive has, may have or may acquire
prior to or during the term of this Agreement, is and will be the sole property
of the Company. Executive assigns to the Company all of Executive's present
rights, title and interests in and to that Intellectual Property. Executive
waives and irrevocably quitclaims to the Company any claims that Executive now
or in the future has for infringement of that Intellectual Property. Executive
agrees to take all measures requested by the Company to witness and record the
assignment of all of Executive's rights, title and interests in or to that
Intellectual Property to the Company or its designee. Executive agrees to take
all measures requested by the Company to help the Company in obtaining
protection for, and benefit from, that Intellectual Property. The Company will
bear all costs of such measures taken by Executive.

 

(iv)     Executive hereby grants to the Company a nonexclusive, royalty free,
perpetual, irrevocable, worldwide license (with the right to sublicense) to
make, have made, copy, modify, make derivative works of, publicly display and
perform, use, sell and otherwise distribute any and all Intellectual Property
that Executive made, conceived, created, discovered, reduced to practice or
learned before the execution of this Agreement with the Company and that
Executive incorporates or may incorporate into any products, process or other
property of the Company.

 

(v)     Executive hereby irrevocably designates and appoints the Company and his
duly authorized officers and agents as the Executive's agent and
attorney-in-fact in the following limited capacity: to act for and on
Executive's behalf and to execute and file any such application or applications
and to perform all other lawfully permitted acts to further the prosecution and
issuance of patents, copyrights or similar protections with the same legal force
and effect as if executed by Executive but only if the Company is unable, after
reasonable effort, to secure Executive's cooperation.

 

(e)     Confidentiality.

 

(i)     Nature and Restriction. Executive agrees that during the term of this
Agreement (including any renewal or extended terms), Executive shall not (i)
disclose to any other person or entity, (ii) use for the benefit of Executive or
persons or entities other than the Company, directly or indirectly, or (iii)
provide for use by other persons or entities any Confidential Information of the
Company. Executive also agrees that upon termination of this Agreement or of the
relationship between Executive and the Company, for any reason, the Executive
shall return to the Company any and all documents and materials of any type
related to the Company's business or other documents and material, including any
and all Confidential Information, that Executive received in connection within
the scope of Executive's employment with the Company.

 

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(ii)     Confidential Information. For purposes of this Agreement, the term
"Confidential Information" shall mean the Company's (i) trade secrets, (ii)
lists of existing and prospective clients, trade vendors, contractors, and other
persons or entities with whom the Company has or contemplates business
relationships, (iii) pricing and cost information related to the Business, (iv)
marketing techniques, plans, and know-how, (v) computer programs and software,
(vi) coding systems and processes, (vii) networking concepts and processes,
(viii) contract terms and prospective contract terms with existing and
prospective clients, accounts and other persons or entities with whom the
Company has or contemplates business relationships, (ix) existing and
prospective geographic locations, and (x) other business information, financing
strategies and practices, training and operational procedures, strategies,
methodologies and processes which are not generally and lawfully known of public
record, public domain or by third parties.

 

(f)     Non-Disparagement. Executive agrees that he will not, whether orally or
in writing, make any disparaging statements or comments, either as fact or as
opinion, about the Company or its products and services, business, technologies,
market position, agents, representatives, directors, officers, shareholders,
attorneys, employees, vendors, affiliates, successors or assigns, or any person
acting by, through, under or in concert with any of them.

 

(g)     Reasonableness of Restrictive Covenants. Executive has carefully read,
reviewed, and considered the provisions of this Section 12 (collectively,
"Restrictive Covenants"), and having done so, stipulates and agrees that that
the understandings and restrictions set forth in the Restrictive Covenants are
fair and reasonable, and are reasonably necessary for the protection of the
interests of the Company. The parties acknowledge that legitimate business
interests of the Company can be protected under applicable Florida law with
respect to covenants like the Restrictive Covenants.

 

(h)     Rights and Remedies Upon Breach of Restrictive Covenants. If Executive
breaches, or threatens to commit a breach of, the Restrictive Covenants, the
Company shall have the right to have the Restrictive Covenants specifically
enforced or to have any actual or threatened breach thereof enjoined by a court
having competent jurisdiction, including a temporary restraining order, in
addition to any and all other remedies. The Company will not be required to post
a bond or provide other collateral in any such proceeding. It is further
expressly understood that and stipulated that a violation of the Restrictive
Covenants by Executive will inherently result in irreparable harm to the
Company. Executive hereby waives any adequate remedy at law defense and failure
or lack of consideration defense to the remedy of injunctive relief. In the
event of any litigation for the construction, interpretation, or enforcement of
any of the terms or provisions of the Restrictive Covenants, reasonable
attorney's fees and costs shall be awarded to the substantially prevailing
party(ies). Executive covenants and agrees that the obligations contained herein
shall be extended by the length of time which Executive shall have been in
breach of any of said provisions. Accordingly, Executive recognizes that the
time periods included in the Restrictive Covenants contained herein shall begin
on the date a court of competent jurisdiction enters an order enjoining
Executive from violating such provisions unless good cause can be shown as to
why the periods described should not begin at that time.

 

(i)     Considerations of the Restrictive Covenants. Executive acknowledges and
understands that but for Executive's execution of this Agreement and the
agreement to the Restrictive Covenants, the Company will/would not engage the
continued services of Executive and that the offer to Executive, together with
any compensation paid (including any compensation payable to Executive following
termination), the Company considers sufficient consideration for the execution
of this Agreement.

 

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(j)     Enforcement. Executive and the Company desire that the provisions of
this Agreement be enforced to the fullest extent permissible under the laws and
public policies of the State of Texas. Executive acknowledges and confirms that
enforcement of the Restrictive Covenants shall not impair his ability to earn a
livelihood. Executive acknowledges that the restrictions contained herein are
reasonable. If a court of competent jurisdiction, however, determines that any
restrictions imposed on Executive under this Agreement are unreasonable or
unenforceable because of duration or otherwise, Executive and the Company agree
and intend that the court shall enforce this Agreement to the maximum extent the
court deems reasonable and that the court shall have the right to strike or
change any provisions of this Agreement and substitute therefor different
provisions to effect the intent of this Agreement to the maximum extent
possible.

 

(k)     Independent Covenants. The Restrictive Covenants set forth in this
Section 12 are given and made by Executive to induce the Company to continue to
employ Executive, and Executive hereby acknowledges the sufficiency of the
consideration for such covenants, and acknowledges that but for such covenants,
the Company would not have agreed to employ Executive. These covenants on the
part of Executive shall be construed as an agreement independent of any other
terms of employment, and the existence of any claim or cause of action of
Executive against the Company shall not constitute a defense to the enforcement
by the Company of these covenants.

 

13.         Successors; Binding Agreement; Assignment.

 

(a)     This Agreement will be binding upon and inure to the benefit of the
Company and any successor to the Company, including without limitation any
persons acquiring directly or indirectly all or substantially all of the
business or assets of the Company whether by purchase, merger, consolidation,
reorganization or otherwise (and such successor will thereafter be deemed the "
Company" for the purposes of this Agreement).

 

(b)     This Agreement will inure to the benefit of, and be enforceable by, the
Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, and legatees. This Agreement will supersede the
provisions of any employment, severance or other agreement between the Executive
and the Company that relate to any matter that is also the subject of this
Agreement, and such provisions in such other agreements will be null and void.

 

(c)     This Agreement is personal in nature and Executive shall not, without
the consent of the Company, assign, transfer, or delegate this Agreement or any
rights or obligations hereunder. Without limiting the generality or effect of
the foregoing, the Executive's right to receive payments hereunder will not be
assignable, transferable, or delegable, whether by pledge, creation of a
security interest, or otherwise, other than by a transfer by the Executive's
will or by the laws of descent and distribution and, in the event of any
attempted assignment or transfer contrary to this Section 13(c), the Company
will have no liability to pay any amount so attempted to be assigned,
transferred, or delegated. The rights and obligations of the Company under this
Agreement (including, without limitation, the Restrictive Covenants in Section
12 hereof) may be assigned by the Company at any time without the consent of
Executive, and shall inure to the benefit of and be enforceable by the
successors and assigns of the Company.

 

12

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14.         Notices. For purposes of this Agreement, all communications,
including without limitation notices, consents, requests or approvals, required
or permitted to be given hereunder will be in writing and will be deemed to have
been duly given when hand delivered or dispatched by electronic facsimile
transmission (with receipt thereof orally confirmed), or five (5) business days
after having been mailed by United States registered or certified mail, return
receipt requested, postage prepaid, or three (3) business days after having been
sent by a nationally recognized overnight courier service such as FedEx or UPS,
addressed to the Company (to the attention of the Secretary of the Company) at
its principal executive office and to the Executive at his principal residence,
or to such other address as any party may have furnished to the other in writing
and in accordance herewith, except that notices of changes of address will be
effective only upon receipt.

 

15.        Gender, Etc. Words used herein, regardless of the number and gender
specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine or neuter, as the
context indicates is appropriate.

 

16.         Governing Law. The validity, interpretation, construction, and
performance of this Agreement will be governed by and construed in accordance
with the substantive laws of the State of Texas, without giving effect to the
principles of conflict of laws of such State

 

17.         Validity. If any provision of this Agreement or the application of
any provision hereof to any person or circumstances is held invalid,
unenforceable or otherwise illegal, the remainder of this Agreement and the
application of such provision to any other person or circumstances will not be
affected, and the provision so held to be invalid, unenforceable or otherwise
illegal will be reformed to the extent (and only to the extent) necessary to
make it enforceable, valid or legal.

 

18.         Miscellaneous. No provision of this Agreement may be modified,
waived, or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto or compliance with
any condition or provision of this Agreement to be performed by such other party
will be deemed a waiver of similar or dissimilar provisions or conditions at the
same or at any prior or subsequent time. No agreements or representations, oral
or otherwise, expressed or implied with respect to the subject matter hereof
have been made by either party that are not set forth expressly in this
Agreement. References to Sections are to references to Sections of this
Agreement. Any reference in this Agreement to a provision of a statute, rule or
regulation will also include any successor provision thereto.

 

19.         Indemnification and D&O Insurance. Executive will be provided
indemnification to the maximum extent permitted by the Company' s and its
subsidiaries' and affiliates' Articles of Incorporation or Bylaws, including, if
applicable, any directors and officers insurance policies, with such
indemnification to be on terms determined by the Board or any of its committees,
but on terms no less favorable than provided to any other Company executive
officer or director and subject to the terms of any separate written
indemnification agreement.

 

20.         Employee Benefits. Executive will be eligible to participate in the
Company employee benefit plans, policies and arrangements that are applicable to
other executive officers of the Company, as such plans, policies and
arrangements may exist from time to time and on terms at least as favorable as
provided to any other executive officer of the Company.

 

21.         No Duplication of Benefits. The benefits provided to Executive in
this Agreement shall offset substantially similar benefits provided to Executive
pursuant to another Company policy, plan or agreement.

 

22.        Survival. Notwithstanding any provision of this Agreement to the
contrary, the parties' respective rights and obligations under this Agreement,
will survive any termination or expiration of this Agreement or the termination
of the Executive's employment for any reason whatsoever.

 

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23.         Counterparts. This Agreement may be executed in multiple
counterparts, and it is not necessary that signatures of all parties appear on
the same counterpart, but such counterparts together will constitute a single
binding agreement between and among all parties hereto. Counterparts may be
executed by hand or by any electronic signature complying with the U.S. federal
ESIGN Act of 2000 (the “ESIGN Act”). Executed counterparts may be delivered via
facsimile, electronic mail or other similar transmission method, and any
executed counterpart so delivered shall be valid and effective for all purposes.
No party shall raise the use of any electronic signature that complies with the
ESIGN Act (including www.docusign.com), or the use of a facsimile machine,
electronic mail or other similar transmission method as a means to deliver a
signature to this Agreement or any amendment hereto as a defense to the
formation or enforceability of a contract and each party forever waives any such
defense.

 

24.         Headings; Captions. The headings and captions of the various
Sections (including any subsections) herein contained are intended for ease of
reference only and are not to be construed as evidence of the intent as to the
content thereof.

 

25.        Construction. The parties acknowledge that each party and its counsel
have reviewed and revised this Agreement and that the normal rule of
construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement, or
any amendments or exhibits hereto or thereto.

 

26.         Legal Fees. If a legal action is initiated by any party to this
Agreement against the other party arising out of or relating to the alleged
performance or non-performance of any right or obligation established hereunder,
any and all fees, costs and expenses reasonably incurred by the successful party
or his or its legal counsel in investigating, preparing for, prosecuting,
defending against, or providing evidence, producing documents or taking any
other action in respect of, such action will be the obligation of and will be
paid or reimbursed by the unsuccessful party.

 

27.         Representation by Independent Legal Counsel. Executive hereby
acknowledges that he has been provided with a copy of this Agreement for review
prior to signing it, that he has been given the opportunity to have this
Agreement reviewed by his own attorney prior to signing it, that he understands
the purposes and effects of this Agreement and that the counsel for the Company,
Johnson, Pope, Bokor, Ruppel & Burns, LLP prepared this Agreement on behalf of
and in the course of its representation of the Company.

 

28.         Supersedes all Prior Agreements. This Agreement supersedes and
replaces in their entirety any previous written agreements or oral
understandings regarding Executive’s employment relationship with the Company
and its subsidiaries.

 

14

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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
and delivered as of the date first above written.

 

 

CUI GLOBAL, INC. 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Corey Lambrecht

 

 

 

Corey Lambrecht, Chairman 

 

 

 

Compensation Committee

 

            “Company”               /s/ William J. Clough      

WILLIAM J. CLOUGH

              “Executive”                  

 

MTC/ej/5390221v1

 

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Annex A

CUI Global, Inc.

Option to Purchase Common Stock

 

Optionee Name: William J. Clough

 

Optionee Address: CUI Global, Inc.

1924 Aldine Western Road

Houston, TX 77038

 

Date of Grant: May 14, 2019

 

Number of Underlying Common Shares: One Million Six Hundred Thousand
(1,600,000).

 

Option Price: $1.14. The NASDAQ.COM closing price per share for the trading day
immediately preceding the date of grant.

 

Vesting: Thirty Six (36) equal monthly installments (May 15, 2019 thru May 15,
2022). 44,444.44 options vest per month.

 

Time of Exercise of Option: The vested options shall be exercisable, in whole or
in part, and from time to time, at any time before ten years from the date of
vesting; provided, that no single exercise of the Option shall be for fewer than
10 shares, unless the number of shares purchased is the total number at the time
available for purchase under this Option to Purchase Common Stock.

 

Cashless Exercise: The holder of the option, at his election, may exercise this
option in a cashless exercise transaction. In order to effect this cashless
exercise, the holder of the option shall give written notice (email is
acceptable) to the company of his intention to use the cashless election and the
date of the cashless exercise. The Company shall issue to the option holder a
number of shares of common stock computed using the following formula:

 

X = Y (A-B)/A

 

where: X = the number of shares of common stock to be issued to the option
holder.   Y = the number of shares of common stock for which the option is being
exercised.   A = the market price of one (1) share of common stock. The "market
price" shall be defined as the average closing price of the common stock for the
five (5) trading days prior to the designated date of exercise of the option
(the "average closing price"), as reported by The NASDAQ Stock Market. If the
Common Stock is/was not traded during the five (5) trading days prior to the
date of exercise, then the closing price for the last publicly traded day shall
be deemed to be the closing price for any and all (if applicable) days during
such five (5) trading day period.   B = the exercise price.

 

This Option to purchase Common Stock is subject to acceleration, termination or
to forfeiture pursuant to the terms of the Optionee’s Employment Agreement with
the Company, the terms of which are incorporated herein by reference. Optionee
expressly acknowledges that this Option to Purchase Common Stock is subject to
shareholder approval of an equity incentive plan of which the Executive is
entitled to participate. If shareholders do not approve an equity incentive
plan, which includes this Option to Purchase Common Stock within one (1) year of
the date of this Option to Purchase Common Stock, then the Executive agrees that
he shall forfeit all right, title and interest in and to this Option to Purchase
Common Stock. The issuance of this Option to Purchase Common Stock shall be
subject to NASDAQ Listing Rule 5635(c). No options may be exercised until
shareholders approve an equity incentive plan, of which the Executive is
entitled to participate. The number of options and exercise price shall be
proportionately and equitably adjusted for any stock splits or other similar
recapitalizations. In no event may the Optionee exercise any Options within six
(6) months of the grant date.

 

IN WITNESS WHEREOF, the Company has duly executed this Option to Purchase Common
Stock as of the 14th day of May, 2019.

 

CUI Global, Inc.

 

By:          /s/ Corey A. Lambrecht              

Corey A. Lambrecht, Chairman

Compensation Committee

 

 

Optionee Signature:

 

/s/ William J. Clough                                       Date: May 14, 2019

 

MTC/ej/5523856v1

 

 

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ANNEX “B”

 

RELEASE OF CLAIMS

 

This RELEASE OF CLAIMS ("Agreement") is made by and between CUI GLOBAL, INC., a
Colorado corporation (the "Company"), and WILLIAM J. CLOUGH (hereinafter
referred to as "You").

 

WHEREAS, You have agreed to enter into a release of claims in favor of the
Company upon certain events specified in the Executive Employment Agreement by
and between the Company and You.

 

NOW, THEREFORE, in consideration of the mutual promises made herein, the Company
and You agree as follows:

 

1.     Termination Date. This means the last day of Your employment with the
Company.

 

2.     Acknowledgement of Payment of Wages. You acknowledge that the Company has
paid you all accrued wages, salary, bonuses, accrued but unused vacation pay and
any similar payment due and owing, with the exception of the payments and
benefits owed to you under the Executive Employment Agreement and/or under any
equity-based compensation awards.

 

3.     Confidential Information. You hereby acknowledge that you are bound by
all confidentiality agreements that you entered into with the Company and/or any
and all past and current parent, subsidiary, related, acquired and affiliated
companies, predecessors and successors thereto, and with any customers or
clients of the Company (which agreements are incorporated herein by this
reference), that as a result of Your employment you have had access to the
Confidential Information (as defined in such agreement(s)), that you will hold
all such Confidential Information in strictest confidence and that You may not
make any use of such Confidential Information on Your own behalf or on behalf of
any third party. You further confirm that within five (5) business days
following the Termination Date, You will deliver to the Company all documents
and data of any nature containing or pertaining to such Confidential Information
and that You will not take with you any such documents or data or any
reproduction thereof.

 

4.     Release and Waiver of Claims. In consideration of the benefits provided
in this Agreement, You release the Company, and any and all past, current and
future parent, subsidiary, related and affiliated companies, predecessors and
successors thereto, as well as their officers, directors, shareholders, agents,
employees, affiliates, representatives, attorneys, insurers, successors and
assigns, from any and all claims, liability, damages or causes of action
whatsoever, whether known or unknown, which exist or may in the future exist
arising from or relating to events, acts or omissions on or before the Effective
Date of this Agreement, other than those rights which as a matter of law cannot
be waived, or may represent post termination payments or benefits to be received
pursuant to the Executive Employment Agreement by and between Company and You.

 

You understand and acknowledge that this release includes, but is not limited to
any claim for reinstatement , re-employment , damages, attorney fees, stock
options (but on the exercise of any previously granted stock options), bonuses
or additional compensation in any form, and any claim, including but not limited
to those arising under tort, contract and local, state or federal statute,
including but not limited to Title VII of the Civil Rights Act of 1964, the
Civil Rights Act of 1991, the Post Civil War Civil Rights Act (42 U.S.C.
1981-88), the Equal Pay Act, the Age Discrimination in Employment Act, the
Americans with Disabilities Act, the Vietnam Era Veterans Readjustment
Assistance Act, the Fair Labor Standards Act, the Family Medical Leave Act of
1993, the Uniformed Services Employment and Re-employment Rights Act, the
Employee Retirement Income Security Act of 1974, and the civil rights,
employment, and labor laws of any state and any regulation under such
authorities relating to Your employment or association with the Company or the
termination of that relationship.

 

 

--------------------------------------------------------------------------------

 

 

You also acknowledge that you are waiving and releasing any rights You may have
under the Age Discrimination in Employment Act (ADEA) and that this waiver and
release is knowing and voluntary. You acknowledge that (1) You have been, and
hereby are, advised in writing to consult with an attorney prior to executing
this Agreement, (2) as consideration for executing this Agreement, You have
received additional benefits and compensation of value to which You would
otherwise not be entitled, and (3) by signing this Agreement, You will not waive
rights or claims under the Act which may arise after the execution of this
Agreement, and (4) You have twenty- one (21) calendar days within which to
consider this Agreement and in the event You sign the Agreement prior to
twenty-one (21) days, You do so voluntarily. Once You have accepted the terms of
this Agreement, You will have an additional seven (7) calendar days in which to
revoke such acceptance. To revoke, You must send a written statement of
revocation to the Vice President of Human Resources. If You revoke within seven
(7) days, You will receive no benefits under this Agreement. In the event You do
not exercise your right to revoke this Agreement, the Agreement shall become
effective on the date immediately following the seven day (7) waiting period
described above.

 

This release does not waive any rights You may have under any directors and
officers insurance or indemnity provision, agreement or policy in effect as of
the Termination Date, nor does it affect vested rights You may have under any
equity-based compensation plan, retirement plan, 401(k) plan or other benefits
plan.

 

5.     No Pending or Future Lawsuits. You represent that You have no lawsuits,
claims, or actions pending in Your name or on behalf of any other person or
entity, against the Company or any other person or entity referred to herein.
You also represent that You do not intend to bring any claims on Your own behalf
or on behalf of any other person or entity against the Company or any other
person or entity referred to herein.

 

6.     Non-Disparagement. You agree that You will not, whether orally or in
writing, make any disparaging statements or comments, either as fact or as
opinion, about the Company or its products and services, business, technologies,
market position, agents, representatives, directors, officers, shareholders,
attorneys, employees, vendors, affiliates, successors or assigns, or any person
acting by, through, under or in concert with any of them.

 

7.     Additional Terms.

 

(a)     Legal and Equitable Remedies. You agree that the Company shall have the
right to enforce this Agreement and any of its provisions by injunction,
specific performance or other equitable relief without prejudice to any other
rights or remedies the Company may have at law or in equity for breach of this
Agreement.

 

 

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(b)     Attorney's Fees. If any action at law or in equity is brought to enforce
the terms of this Agreement, the prevailing party shall be entitled to recover
from the other party its reasonable attorneys' fees, costs and expenses at trial
or arbitration and any appeal therefrom, in addition to any other relief to
which such prevailing party may be entitled.

 

(c)     Non-Disclosure. You agree to keep the contents, terms and conditions of
this Agreement confidential; provided, however, that You may disclose this
Agreement with Your spouse, attorneys, and accountants, or pursuant to subpoena
or court order. Any breach of this non-disclosure paragraph is a material breach
of this Agreement.

 

(d)     No Admission of Liability. This Agreement is not, and the parties shall
not represent or construe this Agreement, as an admission or evidence of any
wrongdoing or liability on the part of the Company, its officers, shareholders,
directors, employees, subsidiaries, affiliates, divisions, successors or
assigns. Neither party shall attempt to admit this Agreement into evidence for
any purpose in any proceeding except in a proceeding to construe or enforce the
terms of this Agreement.

 

(e)     Entire Agreement. This Agreement along with the Executive Employment
Agreement, constitutes the entire agreement between You and the Company with
respect to Your separation from the Company and supersedes all prior
negotiations and agreements, whether written or oral, relating to its subject
matter.

 

(f)     Modification/Successors. This Agreement may not be altered, amended,
modified, or otherwise changed in any respect except by another written
agreement that specifically refers to this Agreement, and that is duly executed
by You and an authorized representative of the Company. This Agreement shall be
binding upon Your heirs, executors, administrators and other legal
representatives and may be assigned and enforced by the Company, its successors
and assigns.

 

(g)     Severability. The provisions of this Agreement are severable. If any
provision of this Agreement or its application is held invalid, the invalidity
shall not affect other obligations, provisions, or applications of this
Agreement that can be given effect without the invalid obligations, provisions,
or applications.

 

(h)     Waiver. The failure of either party to demand strict performance of any
provision of this Agreement shall not constitute a waiver of any provision,
term, covenant, or condition of this Agreement or of the right to demand strict
performance in the future.

 

(i)     Governing Law and Jurisdiction. This Agreement shall be interpreted and
enforced in accordance with the laws of the State of Texas. The exclusive
jurisdiction for any action to interpret or enforce this Agreement shall be the
State of Texas.

 

(j)     Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and same instrument.

 

(k)     Voluntary Execution of Agreement. This Agreement is executed voluntarily
and without any duress or undue influence on the part of the parties hereto,
with the full intent of releasing all claims. You acknowledge that:

 

(i)     You have read this Agreement;

 

(ii)     You understand the terms and consequences of this Agreement and the
releases it contains;

 

(iii)     You have been advised to consult with an attorney prior to executing
this Agreement;

 

(iv)     You knowingly and voluntarily agree to all the terms in this Agreement;
and

 

(v)     You knowingly and voluntarily intend to be bound by this Agreement.

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
and delivered as of the date first above written.

 

 

CUI GLOBAL, INC. 

 

 

 

 

 

 

 

 

 

 

By:

   

 

 

 

Print Name:

 

 

 

Title:

 

 

 

                          WILLIAM J. CLOUGH  

 

 

MTC/ej/5525702v1