Exhibit 10.1

 

AMENDED AND RESTATED PERSONAL EMPLOYMENT AGREEMENT

 

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) is made and
entered into this 25 day of July 2017 (the “Effective Date”) by and between
LabStyle Innovation Ltd., a company incorporated under the laws of the State of
Israel, with its offices at Halamish 9 Caesarea, Israel (the “Company”), and
Erez Raphael (Israeli I.D. No. 025423351) residing at Tavor 135 Nofit, Israel
(the “Executive”) (the Company and the Executive, collectively, the “Parties”).

 

WHEREAS, the Parties are parties to a Personal Employment Agreement entered into
and effective as of October 11, 2012 (the “2012 Agreement”);

 

WHEREAS, the Parties amended the Original Agreement three (3) times: as of April
13, 2013, August 30, 2013, and August 1, 2014;

 

WHEREAS, the Parties desire to fully restate and further amend the 2012
Agreement, as amended;

 

NOW THEREFORE, in consideration of the promises and mutual covenants and
agreements of the Parties set forth herein, the Parties agree as follows:

 

1.            Employment.

 

a.             Term.

 

i.            The term of this Agreement shall begin on the Effective Date and
shall continue until the date set forth in Schedule A annexed hereto (the
“Scheduled Term”), unless earlier terminated by either party or extended as
hereinafter provided. The period commencing on the Effective Date and ending on
the date on which the Executive’s employment ends pursuant to this Agreement is
referred herein as the “New Employment Term”.

 

ii.            Except as the Parties otherwise agree in writing, if the Parties
do not mutually agree in writing to extend or terminate this Agreement on or
prior to the end of the Scheduled Term, the Executive’s employment with the
Company shall renew and continue for additional one (1) year terms following
expiration of the Scheduled Term, subject to the terms and conditions set forth
in this Agreement.

 

b.             Title and Duties.

 

i.            The Executive shall continue to serve as President, Chief
Executive Officer, and Chairman of the Board of Directors (the “Board”) of the
Company and Parent Company, DarioHealth Corporation (the “Parent Company”), with
duties responsibilities and authority commensurate therewith. The Executive
shall report to the Board. The Executive shall perform all duties and accept all
responsibilities incident to such position as may be reasonably assigned to him
by the Board, consistent with his positions. In addition, during the New
Employment Term, without compensation other than that herein provided, the
Executive shall continue to be elected and serve as a member of the Board of the
Parent Company.

 

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ii.           The Executive represents that he is not subject to or a party to
any employment agreement, non-competition covenant, understanding or restriction
that would be breached by or prohibit the Executive from executing this
Agreement and performing fully his duties and responsibilities hereunder.

 

c.             Best Efforts.

 

i.            The Executive will be employed on a full-time basis (i.e., 45
hours per workweek). The Executive’s weekly rest day shall be Saturday, unless
otherwise determined by the Company in a written notice to the Executive. Except
as provided herein, the Executive shall devote his full time and attention to
promote the business of the Company, and shall be engaged in other business
activities only to the extent that such activities do not materially interfere
with his obligations to the Company or materially breach this Agreement.

 

ii.         Notwithstanding Section 1(c)(i) herein, nothing in this Agreement
shall prohibit the Executive from (a) serving on civic, educational,
philanthropic, or charitable boards or committees; (b) serving on other
corporate boards or committees, so long as such activities do not materially
violate this Agreement; (c) making and managing personal investments so long as
such activities do not materially violate this Agreement, and (d) participate as
a passive co-founder of other businesses that do not materially interfere with
the Executive’s obligations to the Company or materially breach this Agreement.
Further, the Company expressly acknowledges and agrees that the affiliations and
activities set forth in Schedule B annexed hereto are expressly permitted.

 

d.             Location. Executive shall perform his duties hereunder at the
Company’s facilities in Israel, but understands and agrees that his position may
involve significant domestic and international travel.

 

2.            Special Agreement; Salary and Special Compensation; Insurance.

 

a.             Special Agreement. The Parties agree that this Agreement is a
personal agreement, and that the position the Executive holds within the Company
is a senior position which requires a special measure of personal trust, as such
terms are defined in the Working Hours and Rest Law 5711 - 1951, as amended (the
“Law’). The provisions of any collective bargaining agreement which exist or
shall exist do not, and will not, apply to the employment of the Executive,
whether such agreement was signed among the government, the General Federation
of Labor and Employers organizations, or any of such parties, or whether signed
by others, in relation to the field or fields of the business of the Company or
in relation to the position held by or the profession of the Executive. In light
of this relationship of trust, the provisions of the Law, or any other law which
may apply, will not apply to the performance by the Executive of his duties
hereunder. Thus, the Executive may be required, from time to time and according
to the work load demanded of his, to work beyond the regular working hours and
the Executive shall not be entitled to any further compensation other than as
specified in this Agreement.

 

b.            Salary; Deferred Salary.

 

i.            The Company shall pay to the Executive as compensation for the
employment services an aggregate base salary at the monthly rate set forth in
Schedule A annexed hereto (the “Salary”).

 

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ii.           The Company shall pay the Executive the Salary or Deferred Salary,
as applicable, no later than the ninth (9th) day of each calendar month after
the month for which the Salary, after deduction of applicable taxes and like
payments. The Executive’s Salary or Deferred Salary, as applicable, shall be
reviewed periodically for increase by the Board (or a committee of the Board)
pursuant to the Board’s normal performance review policies for senior level
executives.

 

c.             Bonus. The Executive shall receive a cash bonus payments to the
extent determined by the Board (or, as applicable, the Compensation Committee of
the Board), which additional bonus payments (if any) shall be based on the
attainment of certain individual and corporate performance goals and targets as
mutually agreed between the Parties, the achievement of which will be determined
by the Board (the “Bonus”). Such Bonus shall be targeted at sixty percent (60%)
of your Salary. Promptly after the Board’s receipt of the financial information
on which any such performance goals are based after the end of the fiscal year,
the Board shall review actual performance against the applicable performance
goals and targets and shall notify the Executive of the amount of his Bonus.
Each Bonus shall be paid to the Executive not later than sixty (60) days
following the end of the preceding fiscal year, subject to applicable taxes and
like payments.

 

d.            Equity Grants.

 

i.            Prior Stock Option Grants. The Parent Company previously granted
the Executive options to purchase shares of common stock of LabStyle Innovations
Corp. and its successor, DarioHealth Corp., as identified in Schedule C annexed
hereto. These award and grants shall remain in full force and effect pursuant to
the applicable award documents, except to the extent otherwise specified in this
Agreement.

 

ii.         Future Stock Option Grants. The Company may, from time to time, at
its sole discretion, also grant the Executive options to purchase additional
shares of common stock in DarioHealth Corp., and/or in other entities (the
“Options”). The Options shall be subject to the terms of the DarioHealth Corp.
2012 Equity Incentive Plan and the 2012 Israeli Sub Plan thereto, as may be
amended from time to time, or any successor plans, and an Option Agreement to be
executed between Parent and the Executive. The Executive acknowledges that he
may be required to execute additional documents in compliance with the
applicable tax laws and/or other applicable laws. In no event, however shall the
Executive be offered Options at any less favorable basis than other senior
Company executives.

 

3.           Insurance and Social Benefits.

 

The Company will insure the Executive under a “Manager's Insurance Scheme”
and/or a pension plan, as per the Executive’s request (the “Insurance Scheme”)
as follows: (i) the Company will pay an amount equal to five percent (5%) of the
Salary towards a fund for life insurance and pension; (ii) the Company will pay
an amount of up to two and one-half percent (2.5%) of the Salary for a fund for
the event of loss of working ability ("Ovdan Kosher Avoda"); and (iii) the
Company will pay an amount equal to eight and one third percent (8 1/3%) of the
Salary towards a fund for severance compensation (the “Company’s Severance
Contribution”). Similarly, at the beginning of each month the Company shall
deduct from the Salary an amount equal to five percent (5%) of the Salary for
the preceding month, and shall pay such amount as premium payable in respect of
the provident compensation component of the Insurance Scheme. Additionally, the
Company together with the Executive will maintain an advanced study fund (“Keren
Hishtalmut”) and the Executive and the Company shall contribute to such fund an
amount equal to two and one half percent (2.5%) of the Salary and seven and one
half percent (7.5%) of the Salary, respectively. All of the Executive’s
aforementioned contributions shall be transferred to the above referred to plans
and funds by the Company by deducting such amounts from each monthly Salary
payment.

 

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4.           Vacation; Holidays; Sick Leave; Convalescence Pay.

 

a.             Executive shall be entitled to the number of vacation days per
year as set forth in Schedule A annexed hereto, as coordinated with the Company
(with unused days to be accumulated up to the limit set pursuant to applicable
law). The Executive shall be entitled to the paid time off for observance of
national holidays pursuant to Schedule A annexed hereto.

 

b.             The Executive shall be entitled to an annual medical executives’
checkup at the expense of the Company.

 

c.             The Executive shall be entitled to a fully paid sick leave until
the end of the waiting period for coverage against disability or incapacity as
defined in the Executive’s medical insurance policy.

 

d.             The Executive shall be entitled to that number of paid sick leave
per year as set forth in Schedule A (with unused days to be accumulated up to
the limit set pursuant to applicable law), and also to Convalescence Pay (“Dmei
Havra’a”) pursuant to applicable law.

 

5.           Additional Employment Benefits.

 

a.             Expenses. The Company shall pay or reimburse the Executive for
all business expenses borne by the Executive, provided that such expenses were
approved in advance by the Company, and against valid invoices therefore
furnished by the Executive to the Company, all in accordance with the Company's
policy as amended from time to time. Notwithstanding any other Company policy,
all expense reimbursements under this Agreement shall be made no later than
ninety (90) days from when expenses are incurred and properly submitted for
reimbursement.

 

b.             Company Car. The Company will continue to provide the Executive
with a car of make and model pursuant to the Company's car policy, as adopted,
as may be amended from time to time by the Company (the “Car”). The Car shall
belong to or be leased by the Company and shall be registered in the Company’s
name for use by the Executive during the period of his employment with the
Company. The Car will be returned to the Company by the Executive following
Executive’s separation from employment. The Executive shall use the Car only in
a manner that is consistent with Company policy, as the Company may be amend
from time to time. The Company shall bear all the fixed and variable costs of
the Car, including licenses, insurance, gasoline, regular maintenance and
repairs. The Company shall not, at any time, bear the costs of any tickets,
traffic offense or fines of any kind and insurance self-participation payment.
The Executive shall bear all the personal tax consequences of the allocation of
the Car to his benefit. Any expenses, payments or other benefits that are made
in connection with the Car are not part of the Salary, for any purpose or
matter, and no social benefits or other payments shall be paid on its account.
It is hereby agreed that the Executive may waive his right to receive the Car in
consideration for the receipt of additional salary in the amount determined by
the Company. In addition, the Executive will be reimbursed for his train
expenses. The Company will gross up for tax purposes the employee’s tax benefit
charged to his salary for using the Company car.

 

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c.             Mobile Phone. At the request of the Executive, the Company shall
provide the Executive with a Company mobile phone for use in connection with his
duties hereunder, pursuant to Company's policy, as adopted and as may be amended
from time to time by the Company (the “Mobile Phone”). The Company shall bear
all expenses relating to the Executive’s use and maintenance of the Mobile Phone
attributed to the Executive under this Section. The Executive shall bear all the
personal tax consequences of the allocation of the Mobile Phone his benefit. Any
expenses, payments or other benefits that are made in connection with the Mobile
Phone shall not be regarded as part of the Salary, for any purpose or matter,
and no social benefits or other payments shall be paid on its account.

 

d.             Attorneys’ and Accountants’ Fees and Costs. The Company shall
reimburse the Executive or pay directly to such attorney(ies) and accountant(s)
of the Executive’s choosing the fees and costs he incurs for legal and
accounting advice and representation with respect to formulation and execution
of this Agreement. The Company shall reimburse or pay directly such fees and
costs within thirty (30) days of receipt of any invoice.

 

6.            Employment Termination; Non-Renewal; Change of Control.

 

a.             Employment Termination Without Cause; Resignation for Good
Reason; Change of Control. If the Executive’s employment is terminated by the
Company without Cause, if the Executive resigns for Good Reason, or if the
Company terminates the Executive’s employment pursuant to or in anticipation of
Change of Control (all as defined in Section 9 herein), then the following
provisions of this Section 6(a) shall apply.

 

i.            The Company may terminate the Executive’s employment with the
Company at any time without Cause upon written notice to the Executive of not
less than the duration of the Notice Period set forth in Schedule A annexed
hereto. If the Company notifies the Executive of termination without Cause, such
separation from employment shall not be effective until the end of the Notice
Period, and the Executive shall be under no obligation to render any additional
services to the Company and shall be allowed to seek other employment during the
Notice Period.

 

ii.            The Executive may resign his employment with the Company for Good
Reason. In such case, the Notice Period shall not apply, but the cure period as
provided in the definition of “Good Reason” shall apply.

 

iii.           The Company may terminate the Executive’s employment pursuant to
or in anticipation of a Change of Control upon the same terms and conditions as
set forth in Section 6(a)(i) herein.

 

iv.           As of the effective termination of employment as described in
Sections 6(a)(i) - (iii) herein (the “Separation Date”), the Executive agrees to
resign all positions with the Company, including as an officer and, if
applicable, as a director or member of the Board, related to the Company and its
parents, subsidiaries and affiliates.

 

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v.           If the Executive fails to provide notice of resignation for Good
Reason pursuant to Section 9(d) herein, the Executive shall be entitled to
receive only the amount due to the Executive under the Company’s then current
severance pay plan or arrangement for employees, if any, but only to the extent
not conditioned on the execution of a release by the Executive or such greater
amount as may be required pursuant to applicable law. Except as expressly
provided herein, no other payments or benefits shall be due under this Agreement
to the Executive, but the Executive shall be entitled to receive any amounts
earned, accrued and owing but not yet paid to him and any benefits accrued and
due under any applicable benefit plans and programs of the Company, in each
case, subject to and in accordance with the terms thereof.

 

vi.         Upon the Separation Date pursuant to Sections 6(a)(i) – (iii)
herein, if, within sixty (60) days following the Separation Date, the Executive
timely executes and delivers to the Company written release of claims against
the Company and related parties with respect to all matters arising out of the
Executive’s employment by the Company or the termination thereof (other than
claims for any entitlements under the terms of this Agreement), in substantially
the form set forth in Exhibit A hereto (the “Release”), the Executive shall be
entitled to receive the following payments and benefits in lieu of the payment
described in Section 6(a)(v) and in lieu of any other payments due under any
severance plan or program for employees or executives (the “Severance
Benefits”):

 

(a)          From the Separation Date through the balance of the Scheduled Term
(if any), the Executive shall continue to receive an amount equal to his Salary
(at the rate in effect immediately before the Separation Date), provided,
however, that such payments in lieu of salary shall continue for a maximum of
twenty-four (24) months (the “Salary Continuation”). Salary Continuation shall
be paid in installments during the Severance Period no less frequently than and
pursuant to terms no less favorable than the Company’s normal payroll practices.
Salary Continuation payments shall commence no later than the sixtieth (60th)
day following the Separation Date.

 

(b)          Notwithstanding Section 6(a)(vi)(a) herein, if the Executive’s
employment is terminated pursuant to Sections 6(a)(i) – (iii) herein either
during the final year of the Scheduled Term or during the final six (6) months
of any subsequently renewed one (1)-year term, then the duration of Severance
Period shall be twelve (12) months.

 

(c)          The Company shall pay the Executive any earned but unpaid Bonus
applicable to any past fiscal year in one (1) lump sum payment no later than the
sixtieth (60th) day following the Separation Date.

 

(d)          At the end of the Severance Period, and simultaneous with the
Company’s payment of the Executive’s final Salary Continuation payment, the
Company shall make the Executive whole with respect to any unpaid Bonus for the
Scheduled Term by paying the Executive an amount equal to any unpaid Bonus or
Bonuses applicable to the remaining applicable Severance Period. For purposes of
such Bonus “make whole” payment, the Bonus shall be calculated using the Bonus
the Company paid the Executive for the fiscal year prior to the Executive’s
employment termination without Cause or resignation for Good Reason.

 

(e)          Beginning on the sixtieth (60th) day following the Separation Date,
and on the first payroll date of each month thereafter during the remainder of
the Scheduled Term (if any), the Company shall pay the Executive a monthly
payment equal to the premium cost for the long and short-term disability
coverage that was in effect for the Executive under plans of the Company
immediately before his termination or resignation. To the extent requested by
the Executive no later than the sixtieth (60th) day following the Separation
Date, the Company shall take all action necessary, if any, to facilitate the
Executive’s exercise of all conversion and/or portability privileges, if any,
under such long and short-term disability coverage.

 

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(f)          Beginning on the sixtieth (60th) day following the Separation Date,
and on the first payroll date of each month thereafter during the remainder of
the Scheduled Term (if any), the Company shall pay the Executive a monthly
payment equal to the full cost of any Company life insurance coverages in effect
for the Executive immediately before his termination or resignation to maintain
life insurance coverage. To the extent requested by the Executive no later than
the sixtieth (60th) day following the Separation Date, the Company shall take
all action necessary, if any, to facilitate the Executive’s exercise of all
conversion privileges, if any, under such life insurance program or policy.

 

vii.         Notwithstanding any provision to the contrary in any applicable
plan, program or agreement, all outstanding equity awards held by the Executive
as of the date of his termination of employment pursuant to this Section 6(a)
shall become fully vested and exercisable as of the Separation Date, and the
Company shall ensure that such associated plan documents, agreements, Option
awards, and other grant agreements accurately reflect this understanding. In
addition, any outstanding stock options held by the Executive, including any
stock options that previously became exercisable and have not expired or been
exercised, shall remain exercisable, notwithstanding any provision to the
contrary in any other agreement governing such options, for the shorter of (i)
the 60-month period following the date of the Executive’s termination pursuant
to this Section 6(a) and (ii) the then remaining term of such stock option, and,
as above, the Company shall ensure that such associated plan documents,
agreements, Option awards, and other grant agreements accurately reflect this
understanding.

 

b.             Non-Renewal. If the Executive’s employment terminates due to the
Company’s decision not to renew this Agreement as provided in Section 1(a)(ii)
herein, then the Executive shall be entitled to the Severance Benefits set forth
in Section 6(a)(v) herein, except that the Severance Period shall be twelve (12)
months.

 

c.             Termination for Cause; Resignation without Good Reason.

 

i.             The Company may terminate the Executive for Cause, in which case
the Notice Period shall not be required (but the cure period as provided in the
definition of “Cause” shall apply).

 

ii.           The Executive may voluntarily terminate his employment for any
reason upon written notice to the Company of not less than the duration of the
Notice Period set forth in Schedule A annexed hereto. During the Notice Period,
the Executive shall faithfully perform his duties for the Company unless
otherwise instructed by the Company or agreed by the Parties.

 

iii.           In the event of termination for Cause or resignation for Good
Reason, the Executive’s entitlement to severance pay will be subject to Sections
16 and 17 of the Severance Law. The Executive shall not receive any other salary
or compensation except as required by law.

 

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7.            Disability.

 

a.           If the Executive incurs a Disability (as defined below), the
Company may terminate the Executive’s employment on account of Disability
subject to the requirements of applicable law.

 

b.           If the Company terminates the Executive’s employment on account of
his Disability, the Executive shall be entitled to receive any amounts earned,
accrued and owing but not yet paid under Section 2 above and any benefits
accrued and due under any applicable benefit plans and programs of the Company,
payable in accordance with the terms and conditions thereof.

 

c.           Notwithstanding any provision to the contrary in any applicable
plan, program or agreement, all outstanding equity awards held by the Executive
as of the date of his employment termination due to Disability shall become
fully vested and exercisable as of such date, and the Company shall ensure that
such associated plan documents, agreements, Option awards, and other grant
agreements accurately reflect this understanding. In addition, any outstanding
stock options held by the Executive, including any stock options that previously
became exercisable and have not expired or been exercised, shall remain
exercisable, notwithstanding any provision to the contrary in any other
agreement governing such options, for the shorter of (i) the 60-month period
following the date of the Executive’s termination or resignation, as applicable,
and (ii) the then remaining term of such stock option, and the Company shall
ensure that such associated plan documents, agreements, Option awards, and other
grant agreements accurately reflect this understanding.

 

d.           If the Executive’s employment is terminated due to Disability,
payments due to the Executive pursuant to this Paragraph 7 shall be offset by
payments the Executive receives pursuant to the applicable disability insurance
plans and programs that provide continuation of Salary, Bonus, health insurance,
or the like.

 

8.            Death.

 

a.           If the Executive dies while employed by the Company, the
Executive’s employment shall terminate on the date of death and the Company
shall pay to the Executive’s executor, legal representative, administrator or
designated beneficiary, as applicable, any amounts earned, accrued and owing but
not yet paid under Section 2 above and any benefits accrued and due under any
applicable benefit plans and programs of the Company, payable in accordance with
the terms and conditions thereof.

 

b.           Notwithstanding any provision to the contrary in any applicable
plan, program or agreement, all outstanding equity awards held by the Executive
as of the date of his employment termination due to Disability shall become
fully vested and exercisable as of such date, and the Company shall ensure that
such associated plan documents, agreements, Option awards, and other grant
agreements accurately reflect this understanding. In addition, any outstanding
stock options held by the Executive, including any stock options that previously
became exercisable and have not expired or been exercised, shall remain
exercisable, notwithstanding any provision to the contrary in any other
agreement governing such options, for the shorter of (i) the 60-month period
following the date of the Executive’s termination or resignation, as applicable,
and (ii) the then remaining term of such stock option, and the Company shall
ensure that such associated plan documents, agreements, Option awards, and other
grant agreements accurately reflect this understanding.

 

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c.           Except as provided in this Section 8(c), the Company shall have no
further liability or obligation under this Agreement to the Executive’s
executors, legal representatives, administrators, heirs or assigns or any other
person claiming under or through the Executive

 

d.           If the Executive’s employment is terminated due to Death, payments
due to the Executive pursuant to this Paragraph 7 shall be offset by payments
the Executive receives pursuant to the applicable Company-provided insurance
plans and programs that provide continuation of Salary, Bonus, health insurance,
or the like.

 

9.            Definitions.

 

a.           For purposes of this Agreement, “Cause” shall mean any of the
following grounds for termination of the Executive’s employment:

 

i.            conviction of any felony by the Executive involving moral
turpitude affecting the Company or its affiliates or any crime involving fraud;

 

ii.           action taken by the Executive intentionally to materially harm the
Company;

 

iii.           embezzlement of funds of the Company or its affiliates by the
Executive;

 

iv.           falsification of the Company’s or affiliates’ records or reports
by the Executive;

 

v.           failure to follow the lawful instruction of the Board, as
authorized by a majority of the Board;

 

vi.          any material breach of the Executive’s fiduciary duties or duties
of care to the Company (except for conduct taken in good faith) which, to the
extent such breach is curable, has not been cured by the Executive within
fifteen (15) days after its receipt of notice thereof from Company containing a
description of the breach or breaches alleged to have occurred;

 

vii.          any material breach of the Proprietary Information, Assignment of
Inventions and Non-Competition Agreement attached as Exhibit B by the Executive;
and

 

viii.         any other act or omission that constitutes “cause” under the laws
of the State of Israel.

 

b.             Change of Control. For purposes of this Agreement, a “Change of
Control” shall be deemed to have occurred if:

 

i.            Any “person,” as such term is used in sections 13(d) and 14(d) of
United States Securities Exchange Act of 1934, as amended (the “Exchange Act”)
(other than a person who is a stockholder of the Parent Company on the effective
date of the Plan), becomes a “beneficial owner” (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the Company
representing more than 50% of the voting power of the then outstanding
securities of the Company; provided that a Change of Control shall not be deemed
to occur as a result of a transaction in which the Company becomes a subsidiary
of another corporation and in which the stockholders of the Company, immediately
prior to the transaction, will beneficially own, immediately after the
transaction, shares entitling such stockholders to more than 50% of all votes to
which all stockholders of the parent corporation would be entitled in the
election of directors; or

 

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ii.           During any period of two consecutive years, individuals who at the
beginning of such period were members of the Board of Directors of the Company
cease for any reason to constitute at least a majority thereof (unless the
appointment, election, or the nomination for election by the Company’s
stockholders, of each director elected during such consecutive two-year period
was approved by a vote of at least two-thirds of the directors then still in
office who were directors at the beginning of such period); or

 

iii.          The consummation of (a) a merger or consolidation of the Company
with another corporation where the stockholders of the Company, immediately
prior to the merger or consolidation, will not beneficially own, immediately
after the merger or consolidation, shares entitling such stockholders to more
than 50% of all votes to which all stockholders of the surviving corporation
would be entitled in the election of directors, (b) a sale or other disposition
of all or substantially all of the assets of the Company, or (c) a liquidation
or dissolution of the Company.

 

c.            Disability. Disability shall be defined as the Executive’s
permanent inability to perform his job duties to the Company. Such Disability
shall be verified by a medical professional at the request of the Company.

 

d.            Good Reason. The occurrence of one or more of the following
actions; provided, however, that the Executive shall give the Company not less
than 30 days’ prior written notice of such resignation setting forth in
reasonable specificity the event that constitutes Good Reason, which written
notice, to be effective, must be provided to the Company within thirty (30) days
following initial notification of its occurrence or proposed occurrence, and
during such thirty (30) day notice period, the Company shall have a cure right
(if curable), and if not cured within such period and which action is not then
rescinded within 30 days after delivery of such notice, the Executive’s
termination will be effective upon the expiration of such cure period:

 

i.             A change of the principal office or work place assigned to the
Executive to a location more than 35 miles distant from its location immediately
prior to such change.

 

ii.           A material reduction by the Company of the Executive’s title,
duties, responsibilities, authority, status, reporting relationship or the
Executive’s position.

 

iii.           A material reduction of the Executive’s Salary, Bonus, or other
compensation, unless pursuant to a reduction in such items applicable
proportionally to all senior management and members of the Board of Directors.

 

iv.           Any breach of this Agreement or other agreement between you and
the Company by the Company, without limitation, a material failure to pay
Executive’s Salary in accordance with the terms and conditions of Sections 2(a)
and (b) of this Agreement.

 

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v.           Any reason or no reason following a Change of Control, provided
that the Executive’s notice of resignation under this subsection 9(c)(v) is
provided to the surviving entity following the Change of Control, within the
30-day period following the closing of such Change of Control.

 

10.          Covenants; Compensation for Non-Competition Obligations.

 

a.             The Proprietary Information, Assignment of Inventions and
Non-Competition Agreement, as amended and restated, annexed hereto as Exhibit B
shall govern the Executive’s obligations with respect to such matters, subject
to the terms and conditions of this Agreement.

 

b.             The Parties acknowledge and agree that the Company’s Proprietary
Information, Assignment of Inventions and Non-Competition Agreement does not
prohibit the Executive from the activities set forth in Schedule B annexed
hereto.

 

c.             Executive acknowledges that twenty percent (20%) of the Salary is
paid as special supplementary monthly compensation in consideration for
Executive’s non-competition undertakings and obligations set forth in Exhibit B
hereto (the “Special Non-Competition Monthly Compensation”). Executive warrants
and represents that the Special Non-Competition Monthly Compensation constitutes
a real, appropriate and full consideration to any prejudice he may suffer due to
his non-competition undertakings and obligations set forth in Exhibit B hereto,
including but not limited to restriction of his freedom of employment.

 

11.          Miscellaneous. The laws of the State of Israel shall apply to this
Agreement and the sole and exclusive place of jurisdiction in any matter arising
out of or in connection with this Agreement shall be the Tel-Aviv Regional Labor
Court. The provisions of this Agreement are in lieu of the provisions of any
collective bargaining agreement, and therefore, no collective bargaining
agreement shall apply with respect to the relationship between the parties
hereto (subject to the applicable provisions of law). No failure, delay or
forbearance of either party in exercising any power or right hereunder shall in
any way restrict or diminish such party's rights and powers under this
Agreement, or operate as a waiver of any breach or nonperformance by either
party of any terms or conditions hereof. In the event it shall be determined
under any applicable law that a certain provision set forth in this Agreement is
invalid or unenforceable, such determination shall not affect the remaining
provisions of this Agreement, unless the business purpose of this Agreement is
substantially frustrated thereby. The preface, exhibits, and schedules to this
Agreement constitute an integral and indivisible part hereof. This Agreement
constitutes the entire understanding and agreement between the parties hereto,
supersedes any and all prior discussions, agreements and correspondence with
regard to the subject matter hereof, and may not be amended, modified or
supplemented in any respect, except by a subsequent writing executed by both
parties hereto. The Executive acknowledges and confirms that all terms of the
Executive’s employment are personal and confidential, and undertake to keep such
terms in confidence and refrain from disclosing such terms to any third party.
All references to applicable law are deemed to include all applicable and
relevant laws and ordinances and all regulations and orders promulgated there
under, unless the context otherwise requires. The Parties agree that this
Agreement constitutes, among others, notification in accordance with the Notice
to Employees (Employment Terms) Law, 2002. Nothing in this Agreement shall
derogate from the Executive’s rights according to any applicable law, extension
order, collective agreement or other agreement with respect to the terms of
Executive’s employment.

 

Page 11 of 12  

 

 

IN WITNESS WHEREOF the parties hereto have signed this Agreement as of the date
first hereinabove set forth.

 

LABSTYLE INNOVATION LTD.   EREZ RAPHAEL       /s/ Dennis M. McGrath   /s/ Erez
Raphael By: Dennis M. McGrath     Title: Chairman of the Compensation    
Committee of the Board of Directors    

 

Page 12 of 12  

 

 

SCHEDULE A

 

To the Amended and Restated Personal Employment Agreement by and between

LabStyle Innovation Ltd. and the Employee Whose Name is Set Forth Herein

 

1. Name of Employee: Erez Raphael       2. I.D. No. of Employee: 025423351      
3. Address of Employee: Tavor 135, Nofit, ISRAEL       4. Position in the
Company: Chairman, President and Chief Executive Officer of the Company and of
the parent Company DarioHealth Corp       5. Under the Direct Direction of:
Board of Directors of Dario Health Corp       6. Employment Commencement Date:
August 17th, 2012       7. Agreement Effective Date: July 25, 2017       8.
Agreement Termination Date: December 31, 2020       9. Notice Period: 180 days  
    10. Salary: NIS 80,000       11. Vacation Days Per Year: The greater of what
is authorized pursuant to applicable law or 24 days per year       12. Sick
Leave Days Per Year: Pursuant to applicable law       13. Holidays Per Year: The
greater of what is authorized pursuant to applicable law or 10 days per year

 

 

 

 

SCHEDULE B

 

To the Amended and Restated Personal Employment Agreement by and between

LabStyle Innovation Ltd. and the Employee Whose Name is Set Forth Herein

  

Name of Employee: Erez Raphael     I.D. No. of Employee: 025423351     Date:
July 25, 2017

 

Board Seat – Precise Bio

Board Seat - Mavrin Health

 

 

 

 

SCHEDULE C

 

To the Amended and Restated Personal Employment Agreement by and between

LabStyle Innovation Ltd. and the Employee Whose Name is Set Forth Herein

  

Name of Employee: Erez Raphael     I.D. No. of Employee: 025423351     Date:
July 25, 2017

  

Option grants outstanding

 

Grant date  Options Granted   Exercise Price  15/3/13   2,001   $121.50  6/6/13 
 223   $270.00  29/8/13   3,334   $240.30  7/1/14   889   $166.50  7/7/14 
 4,667   $88.20  3/9/15   168,904   $5.76  30/1/17   143,164   $3.202 

 

 

 

 

EXHIBIT A

 

To the Personal Employment Agreement by and between

LabStyle Innovation Ltd. and the Employee whose name is set forth herein

 

 

 

 

 

EXHIBIT B

 

To the Personal Employment Agreement by and between

LabStyle Innovation Ltd. and the Employee whose name is set forth herein

  

Name of Employee: Erez Raphael     I.D. No. of Employee: 025423351     Date:
July 25, 2017 (the “Effective Date”)

 

General

 

1.Capitalized terms herein shall have the meanings ascribed to them in the
Agreement to which this Exhibit is attached (the "Agreement"). For purposes of
any undertaking of the Employee toward the Company, the term "Company" shall
include any parent company, subsidiaries and affiliates of the Company. The
Employee's obligations and representations and the Company's rights under this
Exhibit shall apply as of the Effective Date, regardless of the date of
execution of the Agreement.

 

Confidentiality; Proprietary Information

 

2."Proprietary Information" means confidential and proprietary information
concerning the business and financial activities of the Company, including,
without limitation, patents, patent applications, trademarks, copyrights and
other intellectual property, and information relating to the same, technologies
and products (actual or planned), know how, inventions, research and development
activities, inventions, trade secrets and industrial secrets, and also
confidential commercial information such as investments, investors, employees,
customers, suppliers, marketing plans, etc., all the above - whether
documentary, written, oral or computer generated. Proprietary Information shall
also include information of the same nature which the Company may obtain or
receive from third parties.

 

3.Proprietary Information shall be deemed to include any and all proprietary
information disclosed by or on behalf of the Company and irrespective of form
but excluding information that (i) was known to Employee prior to Employee's
association with the Company, as evidenced by written records; (ii) is or shall
become part of the public knowledge except as a result of the breach of the
Agreement or this Exhibit by Employee; (iii) reflects general skills and
experience; or (iv) reflects information and data generally known in the
industries or trades in which the Company operates.

 

4.Employee recognizes that the Company received and will receive confidential or
proprietary information from third parties, subject to a duty on the Company's
part to maintain the confidentiality of such information and to use it only for
certain limited purposes. In connection with such duties, such information shall
be deemed Proprietary Information hereunder, mutatis mutandis.

 

 

 

 

5.Employee agrees that all Proprietary Information, and patents, trademarks,
copyrights and other intellectual property and ownership rights in connection
therewith shall be the sole property of the Company and its assigns. At all
times, both during the employment relationship and after the termination of the
engagement between the parties, Employee will keep in confidence and trust all
Proprietary Information, and will not use or disclose any Proprietary
Information or anything relating to it without the written consent of the
Company, except as may be necessary in the ordinary course of performing
Employee's duties under the Agreement.

 

6.Upon termination of Employee's engagement with the Company, Employee will
promptly deliver to the Company all documents and materials of any nature
pertaining to Employee's engagement with the Company, and will not take with him
any documents or materials or copies thereof containing any Proprietary
Information.

 

7.Employee's undertakings set forth in Section 1 through Section 6 shall remain
in full force and effect after termination of the Agreement or any renewal
thereof.

 

Disclosure and Assignment of Inventions

 

8."Inventions" means any and all inventions, improvements, designs, concepts,
techniques, methods, systems, processes, know how, computer software programs,
databases, mask works and trade secrets, whether or not patentable,
copyrightable or protectable as trade secrets; "Company Inventions" means any
Inventions that are made or conceived or first reduced to practice or created by
Employee, whether alone or jointly with others, during the period of Employee's
engagement with the Company, and which are: (i) developed using equipment,
supplies, facilities or Proprietary Information of the Company, (ii) result from
work performed by Employee for the Company, or (iii) related to the field of
business of the Company, or to current or anticipated research and development.

 

9.Employee hereby confirms that all rights that he may have had at any time in
any and all Company's Inventions, are and have been from inception in the sole
ownership of the Company, including during the process of its incorporation. If
ever any doubt shall arise as to the Company’s rights or title in any Invention
and it shall be asserted that the Employee, allegedly, is the owner of any such
rights or title, then Employee hereby irrevocably transfer and assign in whole
to the Company without any further royalty or payment any and all rights, title
and interest in any and all Inventions. Employee has listed below in this
Section 9 a complete list of all inventions to which he claim ownerships (the
"Prior Inventions") and that he desires to remove from the operation of this
Agreement, and acknowledges and agrees that such list is complete. If no such
list is attached to this Agreement, Employee represents that he has no such
Inventions at the time of signing this Agreements. The Prior Inventions, if any,
patented or unpatented, are excluded from the scope of this Agreement. If, in
the course of employment with the Company, Employee incorporates a Prior
Invention into a Company product, process or machine, the Company is hereby
granted and shall have a nonexclusive, royalty-free, irrevocable, perpetual,
worldwide license (with rights to sublicense through multiple tiers of
sublicensees) to make, have made, modify, use and sell such Prior Invention.
Notwithstanding the foregoing, Employee agrees that he will not incorporate, or
permit to be incorporated, Prior Inventions in any Company Inventions without
the Company's prior written consent. Employee hereby represents and undertakes
that none of his previous employers or any entity with whom he was engaged, has
any rights in the Inventions or Prior Inventions and such employment with the
Company will not grant any of them any right in the results of the Employee’s
work.

 

 

 

 

  Prior Inventions: [fill-in, if any.]

  

  None.    

 

10.Employee undertakes and covenants he will promptly disclose in confidence to
the Company all Inventions deemed as Company Inventions. The Employee agrees and
undertakes not to disclose to the Company any confidential information of any
third party and, in the framework of his employment by the Company, not to make
any use of any intellectual property rights of any third party.

 

11.Employee hereby irrevocably transfers and assigns to the Company all
worldwide patents, patent applications, copyrights, mask works, trade secrets
and other intellectual property rights in any Company Invention, and any and all
moral rights that he may have in or with respect to any Company Invention. For
the removal of any doubt, it is hereby clarified that the provisions concerning
assignment of Inventions contained in Section 8 and this Section ‎11 will apply
also to any "Service Inventions" as defined in the Israeli Patent Law, 1967 (the
"Patent Law"). However, in no event will such Service Invention become the
property of the Employee and the provisions contained in Section 132(b) of the
Patent Law shall not apply unless the Company provides in writing otherwise. The
Employee will not be entitled to royalties or other payment with regard to any
Prior Inventions, Company Inventions, Service Inventions or any of the
intellectual property rights set forth above, including any commercialization of
such Prior Inventions, Company Inventions, Service Inventions or other
intellectual property rights. The Employee irrevocably confirms that the
consideration explicitly set forth in the employment agreement is in lieu of any
rights for compensation that may arise in connection with the Inventions under
applicable law and the employee hereby expressly and irrevocably confirms that
the provisions contained in Section 134 of the Patent Law shall not apply and he
waives any right to claim royalties or other consideration with respect to any
Invention.

 

 

 

  

12.Employee agrees to assist the Company, at the Company's expense, in every
proper way to obtain for the Company and enforce patents, copyrights, mask work
rights, and other legal protections for the Company Inventions in any and all
countries. Employee will execute any documents that the Company may reasonably
request for use in obtaining or enforcing such patents, copyrights, mask work
rights, trade secrets and other legal protections. Such obligation shall
continue beyond the termination of Employee's engagement with the Company.
Employee hereby irrevocably designates and appoints the Company and its
authorized officers and agents as Employee's agent and attorney in fact, coupled
with an interest to act for and on Employee's behalf and in Employee's stead to
execute and file any document needed to apply for or prosecute any patent,
copyright, trademark, trade secret, any applications regarding same or any other
right or protection relating to any Proprietary Information (including Company
Inventions), and to do all other lawfully permitted acts to further the
prosecution and issuance of patents, copyrights, trademarks, trade secrets or
any other right or protection relating to any Proprietary Information (including
Company Inventions), with the same legal force and effect as if executed by
Employee himself.

 

Non-Competition

 

13.In consideration of Employee's terms of employment hereunder, which include
special compensation for his undertakings under this Section 13 and the
following Section 14, and in order to enable the Company to effectively protect
its Proprietary Information, Employee agrees and undertakes that he will not, so
long as the Agreement is in effect and for a period of twelve (12) months
following termination of the Agreement, for any reason whatsoever, directly or
indirectly, in any capacity whatsoever, engage in, become financially interested
in, be employed by, or have any connection with a business or venture that is
engaged in glucose monitoring and is competitive with the activities of the
Company. Employee hereby acknowledges and agrees that the Salary and social
benefits to which the Employee is or shall be entitled to, if any, as set forth
in the Agreement, is set to a level which reflects adequate compensation
sufficient to reimburse prejudice, if any, including but not limited to any of
Employee's legitimate rights and interests. Employee further warrants and
represents that the Special Non-Competition Monthly Compensation (as defined in
the Agreement) constitutes a real, appropriate and full consideration to any
prejudice Employee may suffer due to his non-competition undertakings and
obligations set forth in this Exhibit, including but not limited to restriction
of his freedom of employment.

 

14.Employee agrees and undertakes that during the employment relationship and
for a period of twelve (12) months following termination of this engagement for
whatever reason, Employee will not, directly or indirectly, including personally
or in any business in which Employee may be an officer, director or shareholder,
solicit for employment any person who is employed by the Company, or any person
retained by the Company as a consultant, advisor or the like who is subject to
an undertaking towards the Company to refrain from engagement in activities
competing with the activities of the Company (for purposes hereof, a
"Consultant"), or was retained as an employee or a Consultant during the six
months preceding termination of Employee's employment with the Company.

 

 

 

 

Reasonableness of Protective Covenants

 

15.Insofar as the protective covenants set forth in this Exhibit are concerned,
Employee specifically acknowledges, stipulates and agrees as follows: (i) the
protective covenants are reasonable and necessary to protect the goodwill,
property and Proprietary Information of the Company, and the operations and
business of the Company; and (ii) the time duration of the protective covenants
is reasonable and necessary to protect the goodwill and the operations and
business of Company, and does not impose a greater restrain than is necessary to
protect the goodwill or other business interests of the Company. Nevertheless,
if any of the restrictions set forth in this Exhibit is found by a court having
jurisdiction to be unreasonable or overly-broad as to geographic area, scope or
time or to be otherwise unenforceable, the parties hereto intend for the
restrictions set forth in this Exhibit to be reformed, modified and redefined by
such court so as to be reasonable and enforceable and, as so modified by such
court, to be fully enforced.

 

Remedies for Breach

 

16.Employee acknowledges that the legal remedies for breach of the provisions of
this Exhibit may be found inadequate and therefore agrees that, in addition to
all of the remedies available to Company in the event of a breach or a
threatened breach of any of such provisions, the Company may also, in addition
to any other remedies which may be available under applicable law, obtain
temporary, preliminary and permanent injunctions against any and all such
actions.

 

Intent of Parties

 

17.Employee recognizes and agrees: (i) that this Exhibit is necessary and
essential to protect the business of Company and to realize and derive all the
benefits, rights and expectations of conducting Company’s business; (ii) that
the area and duration of the protective covenants contained herein are in all
things reasonable; and (iii) that good and valuable consideration exists under
the Agreement, for Employee's agreement to be bound by the provisions of this
Exhibit.

 

IN WITNESS WHEREOF the Employee has signed this Agreement as of the date first
hereinabove set forth.

 

        Erez Raphael  

 

 

 

 

EXHIBIT C

 

GENERAL APPROVAL REGARDING PAYMENTS BY EMPLOYERS TO A PENSION FUND AND INSURANCE
FUND IN LIEU OF SEVERANCE PAY UNDER THE SEVERANCE PAY LAW, 5723-1963

 

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