**Exhibit 10.14**

 

**CandelaCorporation**

 

# Executive Employment,Non-competition and Non-disclosure Agreement

 

THISEMPLOYMENT, NONCOMPETITION AND NONDISCLOSURE AGREEMENT (this “EmploymentAgreement”), effective as of[              ,2007](the “Effective Date”) is made by and between Candela Corporation, aDelaware corporation (the “Company”), and[                        ](the “Executive”).  The Companyand the Executive are sometimes referred to, individually, as a “Party”or, collectively, as the “Parties.”

 

BACKGROUND

 

The Executive is employed by the Company. The Companydesires to maintain the employment of the Executive, and the Executive wishesto remain employed by the Company, upon the terms and conditions hereinafterset forth.

 

The Executive acknowledges that in the course ofrendering services to the Company, he may have and will in the future becomeacquainted, with information about the business and financial affairs of theCompany, and may have contributed or may in the future contribute to such information.The Executive recognizes that in order to protect the legitimate interests ofthe Company it is necessary for the Company to protect all such information bykeeping it secret or confidential.

 

To evidence the understanding and agreement of the Companyand the Executive with regard to various aspects of the Executive’s continuingemployment and post-employment benefits, the Executive and the Company evidencetheir various agreements in this Employment Agreement.

 

INCONSIDERATION of the premises, the mutual covenants and conditions set forthherein, for the Company continuing to employ the Executive, and for other goodand valuable consideration, the receipt and sufficiency of which are herebyacknowledged, the parties agree as follows:

 

1.     EMPLOYMENT

 

1.1.    Employmentat Will.  The Company herebyoffers the Executive, and Executive hereby accepts, employment or continuedemployment as [**Position**] (the “Position”)of the Company upon the terms and conditions hereinafter set forth herein.  Employment by the Company is terminable atany time, for any reason, at the will of either the Executive or theCompany.  Executive understands andacknowledges that he serves in such Position under the direct or indirectdirection of the Chief Executive Officer and President (the “CEO”) of theCompany, and his service may be terminated in the sole discretion of theCEO.  No statement of policy orprocedure, whether written or oral, or set forth in any manual or guide, shallbe deemed or construed to be a promise by the Company to continue employment ofthe Executive for any definite term, nor shall any such statement, policy orprocedure require the Company to follow any special procedure, such asprogressive discipline, before terminating employment.

 

1.2.    Exclusive Employment.  The Executive shall devote his full-timeefforts during normal business hours, and as otherwise reasonably required, tofulfill Executive’s employment responsibilities, exclusively for the benefit ofthe Company as required hereunder, and shall perform no services for, and shallnot become employed or engaged by, any other person, firm or entity whileemployed by the Company. The foregoing shall not prevent Executive from (i) servingon corporate, civic or charitable boards or committees; (ii) deliveringlectures or fulfilling speaking engagements; and/or (iii) managingpersonal investments, so long as such activities do not interfere with theperformance of Executive’s responsibilities under this Employment Agreement.

 

1.3.    Duties.  The Executive’s duties and responsibilitiesshall be as assigned by the CEO of the 

 

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Company in hisdiscretion but shall be consistent with Executive’s position.  At all times the CEO shall be subject to thedirection and control of the Board of Directors of the Company, and theExecutive shall be subject to the direction and control of the CEO.

 

2.     COMPENSATION

 

Duringthe Term (as defined in Section 13.1 hereof), as compensation tothe Executive for all of the services to be provided by the Executive to theCompany, the Company agrees to pay, and the Executive agrees to and doesaccept, the payments set forth below in this Section 2, unlessotherwise agreed to by the Company and the Executive:

 

2.1.    Salary.  For so long as the Executive shall remainemployed by the Company in the present Position during or after the Term, heshall be entitled to receive an annual salary of [    **Insert Salary**    ]($                  )(“Salary”).  Salary shall be paid,in arrears, on such legal basis as the Company shall generally follow from timeto time, net of all taxes and other legally required or mutually agreedwithholdings.  Salary may be modifiedfrom time to time by the CEO without formal amendment to this EmploymentAgreement.  In this regard, the Executivehereby authorizes the Company to withhold from salary payments any amounts owedto the Company by Executive hereunder or any other amounts as may be agreed tosubsequently, including, but not limited to, overpayments and 401kcontributions.

 

2.2.    Benefits.  The Executive shall be entitled to thebenefits, such as health insurance, dental insurance, life insurance, long-termcare, vacation, paid and unpaid leave as the Company may from time to timeoffer to employees generally as a standard benefit, and shall be entitled tosuch additional benefits as are offered to other senior officers by the Companyat the same general level of responsibility and title as the Executive.  Benefits are subject to change at any timewith such notice to employees as may be required by applicable employee benefitplans and laws governing them.  Nospecial or different terms shall apply to Executive unless set forth in writingand signed by an authorized executive officer of the Company.

 

2.3.    Cash Bonuses.  The Executive may or may not receive a bonusin respect of any fiscal year depending on the parameters set by the CEO andapproved by the Compensation Committee of the Board of Directors, based uponthe performance, respectively, of the Executive and/or the Company, and theachievement of targets established in such bonus plan.  If the bonus plan for a particular year ispremised solely upon the performance of the Company (rather than eitherspecific metrics for an officer, or such officer-specific metrics andperformance of the Company together), then the CEO may recommend, and in suchcase the Board of Directors or Compensation Committee thereof shall consider,approval of bonus arrangements outside of the bonus plan for an individualExecutive based upon the Executive’s performance evaluation.  Nothing herein shall be deemed to compel theCEO or the Board of Directors or Compensation Committee thereof to establish abonus pool for any particular period, nor shall the Executive be deemed to be entitledto any bonus irrespective of the achievement of various targets contained in aformal bonus program approved as aforesaid, provided, however, ifthe Board of Directors or Compensation Committee has approved your eligibilityto participate in a bonus pool, your targets have been identified and approved,the time period for the achievement of your targets has been completed, and youhave achieved one or more targets that were to give rise to specified amountsof bonus, then, in such case, you shall be entitled to receive your bonus inrespect of that bonus period.

 

2.4.    EquityAwards.  Subject to theapproval of the Board of Directors, or the Compensation Committee thereof, theExecutive shall be entitled to receive options to purchase common stock of theCompany, Stock Appreciation Rights, shares of restricted stock, or such otherequity grants as may be determined by the Board of Directors, or CompensationCommittee thereof, in its or their sole and complete discretion.

 

2.5.    Review ofSalary and Bonus. Salary and bonus potential shall be reviewed at least annually by theCEO.

 

2.6.    SupplementalRetirement Plan. Executive will be eligible to participate in any supplemental retirementplan, if adopted by the Company upon the standard terms that may be offered toother executives of the same or similar level of the Company.

 

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2.7.    Company Car.  The Employee will be entitled to the use of aCompany car, leased by the Company, in a price range determined by the CEO fromtime to time.  In the event theEmployee’s employment is terminated at any time by the Company, for reasonsother than for Cause, the Company will continue to make two full monthlypayments on the lease.

 

2.8.    No Assurances.  The Executive acknowledges that there can beno assurance that the performance of the Company will be sufficient to achievethe conditions prerequisite to the payment of any of the bonus compensationprovided for above, nor can there be any assurance at any time with respect tothe value of any of the equity compensation provided for above, includingwithout limitation, at the time of any exercise of stock options, StockAppreciation Rights, or similar equity instruments.

 

3.     INTELLECTUALPROPERTY PROTECTION

 

For purposes of thisEmployment Agreement, the following terms shall have the meanings assigned tothem below:

 

3.1.    Definitions:

 

3.1.1.  ConfidentialInformation: The term “Confidential Information” shall mean any trade secret,proprietary or confidential information concerning the organization, personnel,business or finances of the Company, or of any third party which the Company isunder an obligation to keep confidential, and that is maintained by the Companyas confidential.  Such ConfidentialInformation shall include, but is not limited to, trade secrets, proprietary orconfidential information respecting existing and future products and services, designs, methods, formulas, drafts ofpublications, research, know-how, techniques, systems, databases, processes,software programs or code, developments or experimental work, works ofauthorship, customer and prospect lists and/or customer information and relatedinformation, business plans, marketing plans, price lists, financialinformation, sales techniques, projects, the Company’s salary and/or pay rates,other Company personnel information, and all other plans and proposals.  Failure to mark any of the ConfidentialInformation as confidential shall not affect its status as part of theConfidential Information covered under the terms of this Employment Agreement.

 

3.1.2.  Developments:  The term “Developments” shall mean anyinvention, modification, discovery, design, development, improvement, process,software program, work of authorship, documentation, formula, data, technique,know-how, trade secret or intellectual property right whatsoever or anyinterest therein (whether or not patentable or registrable under copyright,trademark or similar statutes, including, but not limited to, the SemiconductorChip Protection Act, or subject to analogous protection).

 

3.2.    Disclosureof Developments

 

3.2.1.  TheExecutive agrees that he will communicate in writing to the Board of Directorsof the Company, or such officer or individual as the Board of Directors of theCompany may from time to time designate, a full and complete disclosure of anyand all Developments, research and other information, discoveries andimprovements made, developed, conceived and/or reduced to practice by theExecutive, alone, or jointly with others during a one (1) year periodfollowing the termination of my employment or other association with theCompany, if such Developments, research, discoveries or improvements relate tothe business of the Company.

 

3.2.2.  The businessof the Company includes any technical or business interest that has been workedon by the Company in the past, or in which there is work in progress at theCompany during the period of Executive’s employment with the Company.  The business interests of the Company includeCompany operations or activities in the planning stages.

 

3.2.3.  Executive’sWorks.  The Executivehereby represents and warrants that the Executive has fully disclosed to theCompany and attached hereto a description of any Developments which, prior tohis employment with the Company, the 

 

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Executive conceived of or developed, wholly orin part, but which has not been published or filed with the United StatesPatent or Copyright Offices, and any such Developments which, following hisemployment with the Company, he believes he retains some individual rights tosame.

 

3.3.    Assignmentof Developments

 

3.3.1.  If at anytime or times during the Executive’s employment or other association with theCompany, the Executive shall (either alone or with others) make, conceive,create, discover, invent or reduce to practice any Development that (i) relatesto the business of the Company or any of the products or services beingdeveloped, manufactured or sold by the Company or which may be used in relationtherewith; or (ii) results from tasks assigned to Executive by theCompany; or (iii) results from the use of premises or personal property(whether tangible or intangible) owned, leased or contracted for by theCompany, then all such Developments and the benefits thereof are and shallimmediately become the sole and absolute property of the Company and itsassigns, as works made for hire or otherwise. The Executive shall promptly disclose to the Company (or any personsdesignated by it) each such Development. The Executive hereby assigns to the Company all rights (including, butnot limited to, rights to inventions, patentable subject matter, copyrights andtrademarks) that the Executive may have or may acquire in the Developments andall benefits and/or rights resulting therefrom to the Company and its assignswithout further compensation and shall communicate, without cost or delay, andwithout disclosing to others the same, all available information relatingthereto (with all necessary plans and models) to the Company.

 

3.3.2.  TheExecutive will assist, upon request, in locating writings and other physicalevidence of the making of his Developments and provide unrecorded informationrelating to them, and give testimony in any proceeding in which any of theExecutive’s Developments or any application or patent directed thereto may beinvolved, provided that if Executive is no longer employed by the Company,reasonable compensation shall be paid for such services.  Notwithstanding the foregoing, no obligationis imposed on the Company to remunerate at a higher rate for the giving oftestimony than the rate established by law for the compensation of witnesses inthe court or tribunal where the testimony is taken.  To the extent feasible, the Company will useits best efforts to request such assistance at times and places as will leastinterfere with any other employment of the Executive.

 

3.3.3.  TheExecutive will promptly disclose to the Company all material which theExecutive produces, composes or writes, individually or in collaboration withothers, which arises out of work delegated to the Executive by theCompany.  The Executive agrees that allsuch material constitutes a work for hire, and at the expense of the Company,the Executive hereby assigns to the Company all his interest in suchcopyrightable material and will sign all papers and do all other acts necessaryto assist the Company to obtain copyrights on such material in any and allcountries.

 

3.3.4.  AnyDevelopment relating to the Company’s business made by Executive within one (1) yearfollowing the termination of his employment (and which is required to bedisclosed in accordance with Section 3.2 above) shall be presumed to beowned by the Company.

 

3.3.5.  The Executiveunderstands and acknowledges that this Article 3 does not apply to aninvention for which no equipment, supplies, facilities and/or trade secretinformation of the Company was used and which was developed entirely on theExecutive’s own time, unless the invention relates directly to the business ofthe Company, or to the Company’s actual or demonstrably anticipated research ordevelopment, or the invention results from any work performed by the Executivefor the Company.

 

3.4.    Non-Disclosure:

 

3.4.1.  TheExecutive recognizes that he has been exposed, prior to the date of thisAgreement, and hereafter will be exposed to the Company’s ConfidentialInformation.  The Executive agrees thathe will not, at any time, whether during or after the termination of Executive’semployment, without first obtaining the written approval of the Board ofDirectors of the 

 

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Company, or of such officer or individual as theBoard of Directors of the Company may from time to time designate, divulge,reveal, publish, transfer or disclose to any person or entity outside of theCompany, whether by private communications or by public address or publication,or otherwise, any Confidential Information, except to the extent that such disclosureis necessary to perform the Executive’s duties and fulfill his responsibilitiesas an employee of the Company.  Alloriginal and copies of any Confidential Information or other written materialsrelating to the business of the Company, however and whenever produced, shallbe the sole property of the Company, not to be removed from the premises orcustody of the Company unless necessary to fulfill the essential functions ofthe Executive’s job responsibilities.

 

3.4.2.  TheExecutive shall keep confidential all matters entrusted to the Executive andshall not use or attempt to use any Confidential Information, includingconfidential information related to third parties which the Company isobligated to maintain as confidential, except as may be required in theordinary course of performing Executive’s duties as an employee of the Company,nor shall Executive use any Confidential Information in any manner which mayinjure or cause loss or may be calculated to injure or cause loss to theCompany, whether directly or indirectly.

 

3.5.    Works andInterests of Others. The Executive hereby represents and warrants that employment by theCompany will not violate any agreement or promise of the Executive to any otherperson, and that the Executive will not use any property or ConfidentialInformation of others in his work for the Company.

 

4.     RECORDS ANDTANGIBLE MATERIALS

 

All notes, data, tapes, reference materials, sketches,drawings, memoranda and records in any way relating to any of the informationreferred to in Section 3, and hereof (including, withoutlimitation, any Confidential Information) or otherwise prepared by Executive in the course of hisemployment, and all copies thereof, shall belong exclusively to the Company,and the Executive agrees to deliver to the Company on request all copies ofsuch materials in his possession or then under his control. In the absence ofsuch a request, Executive shall deliver such items to the Company upon thetermination for any reason of the Executive’s employment with the Company.

 

5.     PROTECTION OF INFORMATIONAND GOODWILL

 

5.1.    Nature of Business.  The Executive and the Company recognize thatthe Executive will acquire knowledge as a result of working for the Company,especially in his Position, and that such knowledge will include not onlygeneral knowledge about the Company’s industry, but specific knowledge of theCompany’s business, secrets, products and customers, including ConfidentialInformation.  The Executive and theCompany recognize that upon termination of employment by the Company, theExecutive could use such specific knowledge and information to the detriment ofthe Company by disclosing it to competitors, customers and prospects, and usingit to obtain or win business. The Executive and the Company recognize thatproof of such disclosure would be difficult, yet the harm caused thereby couldbe significant to the Company. Therefore, the Executive and the Company are willing to agree thatConfidential Information will be disclosed to the Executive, and, to protectthe Company, its relationship with its customers, its competitive position, andits goodwill, the Executive will not engage in a competitive venture for atwelve (12) month period after employment by the Company, as specified below.

 

5.2.    The Executive agrees while inthe employ of the Company and for one (1) year thereafter (the“Prohibition Period”), regardless of the reasons for the Executive’stermination, he will not directly or indirectly, do any of the following:

 

5.2.1.  Acceptemployment with a company that competes with the Company in the cosmetic andaesthetic/medical laser and light based system market, or engage in competitiveactivities related thereto, including any business engaged in the business ofdeveloping, producing, marketing or selling products or services of the typeunder development, developed, produced, marketed or sold by the Company whilethe Executive was employed by the Company.

 

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5.2.2.  Withoutlimiting or narrowing the foregoing restriction, accept employment with and/orenter into a competitive relationship with the following list of competitorsand/or any affiliated companies of such competitors also engaged in competitionwith the Company:  Aesthera Alderm, AlmaLasers, CoolTouch, Cutera, Cynosure, DDD, HOYA, ComBio, Laserscope, Lumenis,Palomar Medical Technologies, Radiancy, Reliant, Rhytec, Sciton, Syneron andThermage.

 

5.2.3.  TheExecutive agrees that this Section 5 shall be treated as a separate andindependent clause, and the unenforceability of any provision of it shall in noway impair the enforceability of any of the other clauses of thisAgreement.  Moreover, if any portion of Section 5shall for any reason be held to excessively broad as to the scope, activity,subject or otherwise, so as to be unenforceable by law, it shall be construedby the appropriate judicial body by limiting or reducing it, so as to beenforceable to the maximum extent compatible with the applicable law as itshall then appear.

 

5.2.4.  IrreparableHarm.  Executive and theCompany acknowledge that a breach of this Section 5.2 will causeirreparable harm to the Company.

 

5.2.5.  GeographicalLimitations. The Executive’s obligations under this Section 5 shallextend to all geographical areas in which the Company, or any of its relatedcompanies, is offering its products and services, either directly or indirectlythrough licenses or otherwise, during the Prohibition Period.

 

5.2.6.  Non-Solicitation.  The Executive further agrees that for aperiod of twelve (12) months****fromthe date of termination of his employment, he will not, on behalf of himself orany person or entity, (i) compete for, or engage in competitivesolicitation of, any customer or account of the Company which was contacted,solicited or served by the Company while the Executive was employed by theCompany, or any person or entity that he has, during the twelve (12) monthsimmediately preceding such termination, solicited or serviced on behalf of theCompany or that has been so solicited or serviced, during such period, by anyperson under the Executive’s supervision, or (ii) attempt to hire orengage any individual who was an employee of the Company at any time during thetwelve (12) months immediately prior to such termination.

 

**THEEMPLOYEE REPRESENTS AND WARRANTS THAT THE KNOWLEDGE, SKILLS AND ABILITIES HEPOSSESSES ARE SUFFICIENT TO PERMIT HIM, IN THE EVENT OF TERMINATION OF HISEMPLOYMENT HEREUNDER FOR ANY REASON, TO EARN A LIVELIHOOD SATISFACTORY TO HIMWITHOUT VIOLATING ANY PROVISION OF SECTION 5 HEREOF.**

 

6.     INJUNCTIVE RELIEF

 

TheExecutive understands and agrees that the Company will probably sufferirreparable harm if Proprietary Information is disclosed, or Section 5is breached in any other respect, and that monetary damages will be inadequateto compensate the Company for such breach. Accordingly, the Executive agrees that, in the event of a breach orthreatened breach by the Executive of any of the provisions of this EmploymentAgreement, the Company, in addition to and not in limitation of any otherrights, remedies or damages available to the Company at law or in equity, willbe entitled to, and Executive hereby consents to, a permanent injunction inorder to prevent or to restrain any such breach by the Executive, or by theExecutive’s partners, agents, representatives, servants, employers, employeesand/or any and all persons directly or indirectly acting for or with him.

 

7.     ACCOUNTING FOR PROFITS

 

TheExecutive covenants and agrees that, if he shall violate any of his covenantsor agreements under this Employment Agreement, the Company shall be entitled toan accounting and repayment of all profits, compensation, commissions,remunerations or benefits which the Executive directly or indirectly hasrealized and/or may realize as a result of, growing out of or in connectionwith any such violation; such remedy shall be in addition to and not inlimitation of any 

 

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injunctiverelief or other rights or remedies to which the Company is or may be entitled atlaw, in equity or under this Employment Agreement.

 

8.     REASONABLENESS OFRESTRICTIONS

 

The Executive has carefully read and considered theprovisions of Sections 1 through 7 hereof and, having done so,agrees that the restrictions set forth therein are fair and reasonable and arereasonably required for the protection of the interests of the Company, itsofficers, directors, stockholders and employees.

 

9.     SUCCESSORS AND ASSIGNS

 

ThisEmployment Agreement shall inure to the benefit of, be binding upon, and beenforceable by the Executive, his personal or legal representative orrepresentatives, executors, administrators, successors, heirs, testate orintestate distributees, devisees and legatees and this Employment Agreementshall inure to the benefit of and be binding upon the Company and itssuccessors and assigns.  The term “Company”as used herein shall include such successors and assigns and also shall includeany corporation which is at any time the parent or a subsidiary of the Company,or any corporation or entity which is an affiliate of the Company by virtue ofcommon (although not identical) ownership, and for which the Executive isproviding services in any form during his employment with the Company or anysuch other corporation or entity.  Theterm successors and assigns as used herein shall include a corporation or otherentity acquiring all or substantially all of the assets and business of theCompany (including this Employment Agreement) whether by operation of law orotherwise.  If the Executive should diewhile any amount would still be payable to the Executive or his familyhereunder if the Executive had continued to live, all such amounts, unlessotherwise provided herein, shall be paid in accordance with the terms of thisAgreement to the executors, personal representatives or administrators of theExecutive’s estate.

 

10.   AGREEMENT TO BE BINDING ONSUCCESSOR

 

The Company shall requireany successor (whether direct or indirect, by purchase, merger,consolidation, reorganization or otherwise) to all or substantially all of thebusiness or assets of the Company (the “Acquisition”), as acondition precedent to the Acquisition, to expressly assume andagree  in writing, with a copy to the Executive, to perform thisAgreement in the same manner and to the same extent as the Company would berequired to perform this Agreement as if no such succession had takenplace.  The Executive acknowledges and agrees, and the Companyacknowledges and agrees, that, without limitation to any other provisionof this Agreement which is also “material”, this provision is amaterial term of this Agreement and an important clausebenefiting the Executive, to assure the Executive that the obligation ofthe Company to provide the Executive with the existing benefits madeavailable under this Agreement is adhered to by any successor to theCompany, and the provision also benefits the Company in that the assurance toyou afforded by this provision is an important retention incentive to have theExecutive remain in the employment of the Company.

 

11.   NOTICES

 

Anynotice required or permitted by this Employment Agreement shall be given byregistered or certified mail, return receipt requested, addressed to theCompany at its then principal office, or to the Executive at his then currentaddress set forth in the payroll records of the Company, or to either partyhereto at such other address or addresses as he or it may from time to timespecify for the purpose in a notice similarly given.

 

12.   ENFORCEABILITY AND SCOPE

 

If anyprovision of this Employment Agreement is subsequently determined by a court ofcompetent jurisdiction to be void or unenforceable for any reason, thatprovision shall be deemed stricken and the remainder of the EmploymentAgreement shall not be affected thereby and shall be binding upon the partieshereto insofar as it remains a workable instrument to accomplish the intent andpurposes of the parties. The parties shall negotiate the severed provision tobring the same within the applicable legal requirements to the extent possible.Executive agrees to take any 

 

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andall actions, including without limitation, execution and delivery of any andall instruments and documents necessary or advisable to complete, perfect,evidence or otherwise confirm any of the matters set forth herein.

 

13.   TERM AND OTHER CONDITIONS

 

13.1.  Term.  This Employment Agreement shall take effectas of the Effective Date and shall remain in full force and effect through December 31,2009,and unless notice of termination is provided by one Party to theother Party within 60 days in advance of each June 30 thereafter, thisEmployment Agreement shall be deemed to be renewed for another one-year periodwithout any action on the part of the parties (the “Term”), or until theExecutive’s employment by the Company terminates, or until superseded byanother written employment agreement based upon good and proper considerationand executed by the Executive and the Company, whichever first occurs.  Notwithstanding the foregoing, in the eventof the termination of this Employment Agreement by reason of the termination ofthe Executive’s employment, those provisions hereof which by their terms extendin accordance with such terms, such as, without limitation, the provisions of Section 7,shall survive.  No amendment ormodification of the terms and conditions hereof shall be effective unless setforth in a written document signed by the Executive and the Company, except forthe year-to-year extension hereof by non-objecting Parties provided for above.

 

13.2.  Termination of Employment.

 

13.2.1.     VoluntaryResignation or Discharge For Cause. In the event that either (i) the Executive resigns his employmentduring the Term of this Employment Agreement for any reason other thanInvoluntary Termination (as defined below) (and not due to the Executive’sdeath or Disability), or (ii) the Company discharges the Executive duringthe term of this Employment Agreement for Cause (as hereinafter defined):

 

a)             any stock options orother equity awards previously granted or hereafter granted pursuant to theterms of this Employment Agreement shall continue to be bound by the termsthereof.;

 

b)**           **the Company will pay the Executive:  (i) his base salary then in effectthrough the day of his termination of employment; (ii) any accrued butunused vacation pay; (iii) any reimbursement of business expenses andother amounts earned, accrued or owing, but not yet paid, or to be reimbursedunder Sections **2.1**, **2.2**, or **2.3**;and (iv) any other payments and benefits required by law (together the“Accrued Obligations”); and

 

c)             Executive shall not receive the SeverancePayment (as defined below).

 

For the purposes of this Employment Agreement,“Involuntary Termination” means the Executive’s voluntary resignation from hisemployment, within sixty (60) days following (i) any material diminutionin the Executive’s authority, duties or responsibilities; provided, however,that a change in job position (including a change in title) shall not be deemeda “material diminution” unless Executive’s new authority, duties orresponsibilities are substantially reduced from the prior authority, duties orresponsibilities, (ii) any material diminution of the Executive’s basecompensation, other than an across-the-board reduction in the base compensationof the Company’s officers and senior management employees necessitated by thebusiness or financial condition of the Company, and that does not adverselyaffect the Executive to a greater extent than other such persons, or (iii) amaterial change in the geographic location at which the Executive must performhis duties which is more than 50 miles from the current location, and (iv) amaterial breach by the Company of the terms of this Agreement; provided thatthe Executive’s termination of employment shall not be deemed to be anInvoluntary Termination unless the Company shall have been provided withadvance notice of the termination and a period of not less than 30 days to curethe event or condition described in (i), (ii), (iii) or (iv), and shallhave either failed to so cure the event or waived its right to cure the event.

 

For the purposes of this Employment Agreement, “forCause” shall mean (i) the Executive’s abject failure to work cooperativelywith the Company’s other officers and 

 

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senior employees, as determined in good faith by theCEO, following reasonable notice and opportunity to cure; (ii) the Executive’sgross negligence or willful misconduct in performing any action, or notperforming any action, that has had or could have, alone or in the aggregate, amaterial negative impact on the Company; (iii) the Executive’s theft,dishonesty, willful misconduct, breach of fiduciary duty for personal profit,or falsification of any Company documents or records; (iv) the Executive’sunauthorized use, misappropriation, destruction or diversion of any materialasset or corporate opportunity of the Company (including, without limitation,the Executive’s improper use or disclosure of the Company’s confidential orproprietary information or his failure to abide by Company policies relating toconfidentiality); (v) any intentional act by the Executive which has amaterial detrimental effect on the Company’s reputation or business; (vi) anymaterial breach by the Executive of this Agreement and any other agreementbetween the Company and Executive, including without limitation, the Company’sExecutive Non-Disclosure and Assignment Agreement, which breach is not curedwithin fifteen (15) days after Executive receives notice from the Companyspecifying such breach; (vii) the Executive’s conviction (including anyplea of guilty or *nolo contendere*)of any criminal act involving fraud, dishonesty, misappropriation or moralturpitude, or which impairs the Employee’s ability to perform his duties withthe Company.

 

For purposes of this Employment Agreement,“Disability” means the Executive’s absence from the full-time performance ofthe Executive’s duties with the Company for 180 consecutive calendar days as aresult of incapacity due to mental or physical illness which is determined tobe total and permanent by a physician selected by the Company or its insurersand acceptable to the Executive or the Executive’s legal representative.

 

13.2.2  Discharge Without Cause orInvoluntary Termination.  In theevent the Company discharges Executive during the Term of this EmploymentAgreement without Cause (as defined below) (and not due to the Executive’sdeath or Disability) or the Executive resigns for Involuntary Termination (asdefined above), then:

 

a)             any stock options orother equity awards previously granted or hereafter granted pursuant to thisEmployment Agreement shall continue to be bound by the terms thereof.  The Board of Directors retains its authority,in its sole discretion, to extend the exercise period of any equity instrumentgranted to the Executive, or to accelerate the vesting of any suchinstrument.  If such instrument was originally awarded in the form of anIncentive Stock Option, such adjustments would cause such option to become anon-qualified option;

 

b)            theCompany shall pay Executive the Accrued Obligations;

 

c)             subject to Sections12.3 and Sections 12.4, the Executive shall be entitled to receive his Salaryfor a one-year period, payable in regular monthly installments for a period oftwelve (12) months following such date and if the Executive chooses to electhealth and dental insurance continuation in accordance with the ConsolidatedOmnibus Budget Reconciliation Act of 1985 (“COBRA”), the Company will pay theentire premium payments for his health and dental insurance coverage underCOBRA for a period of twelve (12) months (collectively the “Severance Payment”);

 

d)            the Company shallcontinue to make available to the Executive, and to make payments on, oneleased vehicle, for an additional two full monthly payments from and after hisTermination Date; and

 

e)             the Company shallprovide outplacement services through one or more of the Executive’s choosingup to an aggregate of $10,000, with such services to extend until the earlierof (i) 12 months following the termination of Executive’s employment, or (ii) theday the Executive secures full time employment.

 

Discharge “without Cause”shall mean any discharge that is not for Cause.

 

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13.2.3  Death or Disability.  In the event the Executive’s employment withthe Company terminates due to Executive’s death or Disability:

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a)             any stock options orother equity awards previously granted or hereafter granted pursuant to thisEmployment Agreement shall continue to be bound by the terms thereof;

 

b)            the Company shall paythe Executive the Accrued Obligations in a lump sum in cash within 30 daysafter the date of termination; and

 

c)             neither the Executivenor the heirs, legatees, executors, permitted assigns, or legal representativesof the Executive shall receive the Severance Payment.

 

## **13.3**        Satisfaction of Claims.

## ** **

TheExecutive acknowledges that any of the foregoing payments in Section **13.2** shall satisfy any and all claims of any kind andnature, including without limitation claims for compensation to which he may beentitled in the event the Company terminates the Executive’s employment otherthan for Cause, and agrees to execute and deliver a full and complete releaseof claims substantially in the form of Exhibit A or Exhibit Bhereto, as applicable, simultaneously with the receipt of any such payments,and as a condition precedent to the rights to receive any such payments.

 

## **13.4**        Section 409A.

## ** **

It is the intent of the parties hereto that allseverance payments and benefits provided pursuant to this Employment Agreementqualify as short-term deferrals, as defined in Treasury Regulation§1.409A-1(a)(4), separation pay due to an involuntary separation from serviceunder Treasury Regulation §1.409A-1(b)(9)(iii), reimbursement of medicalbenefits under Treasury Regulation §1.409A-1(b)(9)(v)(B), and/or limitedpayments, as defined in Treasury Regulation §1.409A-1(b)(9)(v)(D).  If (a) it is determined that anypayments or benefits provided pursuant to this Employment Agreement that arepaid upon “separation from service” (as that term is used in Section 409Aof the Internal Revenue Code of 1986, as amended, and any related regulationsor other applicable guidance promulgated thereunder (collectively, “Section 409A”))constitute deferred compensation for purposes of Section 409A (aftertaking into account the exceptions listed in the prior sentence and/or anyother applicable exceptions) and (b) the Executive is a “specifiedemployee” (as that term is used in Section 409A) on the date on which theseparation from service occurs, such payments or benefits (or portions thereof)that constitute deferred compensation and that are to be paid or providedduring the six (6) month period following the Executive’s separation fromservice shall not be paid or provided until the first business day after thedate that is six (6) months following the Executive’s separation fromservice or, if the Executive dies during such six (6) month period, on thefirst business day after the date of the Executive’s death.  The payment that is made pursuant to theprior sentence shall include the cumulative amount of any amounts that couldnot be paid during the six (6) month period.  All other payments or benefits under thisEmployment Agreement shall be paid or provided in accordance with theapplicable provision of this Employment Agreement.  Each installment payment under thisEmployment Agreement shall be treated as a separate payment as defined underTreasury Regulation §1.409A-2(b)(2).  Forall purposes under this Employment Agreement, references to termination of theExecutive’s employment and similar terms shall be interpreted to mean“separation from service,” as that term is used in Section 409A, and theExecutive’s employment shall not be deemed to have terminated for purposes ofthis Section 12 unless and until a separation from service shallhave occurred for purposes of Section 409A.

 

14.           GOVERNINGLAW AND FORUM

 

TheExecutive and the Company agree that this Employment Agreement shall begoverned by and construed in accordance with the internal laws of theCommonwealth of Massachusetts, and any legal proceeding regarding theinterpretation or enforcement of this Employment Agreement shall be institutedin a court of competent jurisdiction located within Commonwealth ofMassachusetts.

 

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15.           CONTROLLING AGREEMENT

 

THEEXECUTIVE AND THE COMPANY HAVE PREVIOUSLY SIGNED ONE OR MORE AGREEMENTS CONTAINING, WITHOUTLIMITATION, NON-DISCLOSURE OBLIGATIONS, AND ASSIGNMENT OF INVENTIONSOBLIGATIONS ON THE PART OF THE EXECUTIVE. THE EXECUTIVE AGREES THAT ALL SUCH UNDERTAKINGS FOR PERIODS PRIOR TO THEDATE OF THIS AGREEMENT SHALL CONTINUE TO BE IN FULL FORCE AND EFFECT.

 

NOTWITHSTANDINGANY OTHER PROVISIONS OF ANY OTHER AGREEMENT OR DOCUMENT TO THE CONTRARY, IN THEEVENT OF ANY CONFLICT OR APPARENT CONFLICT BETWEEN THIS EMPLOYMENT AGREEMENTAND THE TERMS AND CONDITIONS OF SUCH DOCUMENT OR AGREEMENT, INCLUDING BUT NOTLIMITED TO ANY DOCUMENTATION PERTAINING TO STOCK OPTION GRANTS, STOCKAPPRECIATION RIGHTS, RESTRICTED SHARE ISSUES OR OTHER EQUITY INSTRUMENTSGRANTED TO THE EXECUTIVE, THE TERMS AND CONDITIONS OF THIS EMPLOYMENT AGREEMENTSHALL CONTROL AND SUCH OTHER AGREEMENTS OR DOCUMENTS SHALL NOT IMPOSE ANYGREATER LIMITATIONS UPON OR CONDITIONS UPON THE VESTING, RECEIPT OR SALE OFSUCH EQUITY INTERESTS THAN ARE CONTAINED IN THIS EMPLOYMENT AGREEMENT.

 

16.           ENTIRE AGREEMENT

 

Exceptfor any written agreements entered into between the Company and the Executiveprior to the date hereof, pertaining to any of the matters in Sections 4, 5 or6 of this Agreement, which written agreements shall survive the execution ofthis Employment Agreement, this instrument contains the entire agreement of theparties relating to the subject matter hereof, and it supersedes any prior orcontemporaneous oral or written understandings of any kind or nature; provided,however, that this Agreement shall not affect the Executive’s rights under theCandela Corporation Senior Officer Executive Retention Agreement dated [        ], 2007, as may be amended from time totime (the “Retention Agreement”). Notwithstanding the foregoing, in no event shall the Executive beentitled to receive severance payments or benefits under this Agreement if heis entitled to receive severance payments or benefits under the RetentionAgreement. Executive represents that he is not relying on any agreement,representation or warranty pertaining to the subject matter hereof that is notexpressly set forth herein.  The waiveror breach of any term or condition of this Employment Agreement shall not bedeemed to constitute a waiver of any subsequent breach of the same or any otherterm or condition.

 

17.           ARBITRATION

 

Anydispute between the Company and the Executive arising out of or in any mannerconnected with employment or employment practices, including but not limited toclaims of discrimination of any kind and wrongful discharge, under state,federal or local law, shall be submitted to binding arbitration in accordancewith the rules of the American Arbitration Association, to be conducted inBoston, Massachusetts.

 

THE UNDERSIGNED EXECUTIVE HEREBY REPRESENTSTHAT I UNDERSTAND THAT THIS EMPLOYMENT AGREEMENT CONTAINS AN AGREEMENT TOARBITRATE.  AFTER SIGNING THIS DOCUMENT,I UNDERSTAND THAT I WILL NOT BE ABLE TO BRING A LAWSUIT CONCERNING ANY DISPUTETHAT MAY ARISE THAT IS COVERED BY THE ARBITRATION AGREEMENT, UNLESS ITINVOLVES A QUESTION OF CONSTITUTIONAL OR CIVIL RIGHTS.  INSTEAD, I AGREE TO SUBMIT ANY SUCH DISPUTETO AN IMPARTIAL ARBITRATOR.

 

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**Form of Release of Claims**

**(Exhibit A: For Residents ofStates Other than California)**

 

In consideration for receiving benefitspursuant to your Employment, Noncompetition and Nondisclosure Agreement dated[                          ] between youand Candela Corporation. (the “Company”) (the “Agreement”), you, on behalf ofyourself and your representatives, agents, estate, heirs, successors andassigns, agree to and do hereby forever waive, release and discharge theCompany, and each of its affiliated or related entities, parents, subsidiaries,predecessors, successors, assigns, divisions, owners, stockholders, partners,directors, officers, attorneys, insurers, benefit plans, employees and agents,whether previously or hereinafter affiliated in any manner, as well as allpersons or entities acting by, through, or in concert with any of them(collectively, the “Released Parties”), from any and all claims (other than“Excluded Claims” as hereinafter defined), debts, contracts, obligations,promises, controversies, agreements, liabilities, demands, wage claims,expenses, charges of discrimination, harassment or retaliation, disputes,agreements, damages, attorneys’ fees, or complaints of any nature whatsoever,whether or not now known, suspected, claimed, matured or unmatured, existing orcontingent, from the beginning of time until the moment you have signed thisAgreement, against the Released Parties (whether directly or indirectly), orany of them, by reason of any act, event or omission concerning any matter,cause or thing, including, without limiting the generality of the foregoing,any claims related to or arising out of (i) your employment  or its termination, (ii) any contract oragreement (express or implied) between you and any of the Released Parties, (iii) anytort or tort-type claim, (iv) any federal, state or governmentalconstitution, statute, regulation or ordinance, including but not limited tothe U.S. Constitution; Title VII of the Civil Rights Act of 1964, asamended; the Civil Rights Act of 1991; the Age Discrimination in Employment Actof 1967, as amended (including the Older Workers Benefit Protection Act); theEqual Pay Act of 1963, as amended; the Americans With Disabilities Act of 1990;the Family and Medical Leave Act of 1993; the Worker Adjustment Retraining andNotification Act; the Employee Retirement Income Security Act of 1974; the FairLabor Standards Act; any applicable Executive Order Programs; any similar stateor local statutes or laws; and any other federal, state, or local civil orhuman rights law, (v) any public policy, contract or tort law, or undercommon law, (vi) any policies, practices or procedures of the Company, (vii) anyclaim for wrongful discharge, breach of contract, infliction of emotional distress,defamation, (vii) any claim for costs, fees, or other expenses, includingattorneys’ fees incurred in these matters, (viii) any impairment of yourability to obtain subsequent employment, and (ix) any permanent ortemporary disability or loss of future earnings.  It is acknowledged that you may be entitledto satisfaction by the Company of claims you may presently have, or may in thefuture have, for indemnification arising out of the performance of your dutiesas an officer of the Company, pursuant to the terms of the Company’s charter,or its By-laws, or pursuant to the provisions of one or more directors’ andofficers’ (D&O) insurance (D&O) policies.  Any such claim brought by you shall beconsidered an Excluded Claim, but it shall not be presumed that any such claimis valid on its face.

 

For the purpose of implementing a full and complete release anddischarge of the Released Parties, you expressly acknowledge that thisAgreement is intended to include and does include in its effect, without limitation,all claims which you do not know or suspect to exist in your favor against theReleased Parties, or any of them, at the moment of execution hereof, and thatthis Agreement expressly contemplates the extinguishment of all such claims.

 

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**Form of Release of Claims**

**(Exhibit B: For CaliforniaResidents)**

 

In consideration for receiving benefitspursuant to your Employment, Noncompetition and Nondisclosure Agreement dated[                          ] between youand Candela Corporation. (the “Company”) (the “Agreement”), you, on behalf ofyourself and your representatives, agents, estate, heirs, successors andassigns, agree to and do hereby forever waive, release and discharge theCompany, and each of its affiliated or related entities, parents, subsidiaries,predecessors, successors, assigns, divisions, owners, stockholders, partners,directors, officers, attorneys, insurers, benefit plans, employees and agents,whether previously or hereinafter affiliated in any manner, as well as allpersons or entities acting by, through, or in concert with any of them(collectively, the “Released Parties”), from any and all claims other than “Excluded Claims” as herinafter defined, debts, contracts, obligations, promises,controversies, agreements, liabilities, demands, wage claims, expenses, chargesof discrimination, harassment or retaliation, disputes, agreements, damages,attorneys’ fees, or complaints of any nature whatsoever, whether or not nowknown, suspected, claimed, matured or unmatured, existing or contingent, fromthe beginning of time until the moment you have signed this Agreement, againstthe Released Parties (whether directly or indirectly), or any of them, byreason of any act, event or omission concerning any matter, cause or thing,including, without limiting the generality of the foregoing, any claims relatedto or arising out of (i) your employment or its termination, (ii) any contract or agreement (express orimplied) between you and any of the Released Parties, (iii) any tort ortort-type claim, (iv) any federal, state or governmental constitution,statute, regulation or ordinance, including but not limited to the U.S.Constitution; Title VII of the Civil Rights Act of 1964, as amended; theCivil Rights Act of 1991; the Age Discrimination in Employment Act of 1967, asamended (including the Older Workers Benefit Protection Act); the Equal Pay Actof 1963, as amended; the Americans With Disabilities Act of 1990; the Familyand Medical Leave Act of 1993; the Worker Adjustment Retraining andNotification Act; the Employee Retirement Income Security Act of 1974; the FairLabor Standards Act; any applicable Executive Order Programs; any similar stateor local statutes or laws; and any other federal, state, or local civil orhuman rights law, (v) any public policy, contract or tort law, or undercommon law, (vi) any policies, practices or procedures of the Company, (vii) anyclaim for wrongful discharge, breach of contract, infliction of emotionaldistress, defamation, (vii) any claim for costs, fees, or other expenses,including attorneys’ fees incurred in these matters, (viii) any impairmentof your ability to obtain subsequent employment, and (ix) any permanent ortemporary disability or loss of future earnings. .  It is acknowledged that you may be entitledto satisfaction by the Company of claims you may presently have, or may in thefuture have, for indemnification arising out of the performance of your dutiesas an officer of the Company, pursuant to the terms of the Company’s charter,or its By-laws, or pursuant to the provisions of one or more directors’ andofficers’ (D&O) insurance (D&O) policies.  Any such claim brought by you shall beconsidered an Excluded Claim, but it shall not be presumed that any such claimis valid on its face.

 

This Agreement includes a waiver of anyrights you may have under Section 1542 of the California Civil Code, orany other similar state statutes or laws, regarding the waiver of unknownclaims.

 

Section 1542 states:

 

“A GENERAL RELEASE DOESNOT EXTEND TO CLAIMS WHICH THE EMPLOYEE DOES NOT KNOW OR SUSPECT TO EXIST INHIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVEMATERIALLY AFFECTED HIS SETTLEMENT WITH THE EMPLOYER.”

 

Not withstanding the provisions of Section 1542, or any similarstate statutes or laws, and for the purpose of implementing a full and completerelease and discharge of the Released Parties, you expressly acknowledge thatthis Agreement is intended to include and does include in its effect, withoutlimitation, all claims which you do not know or suspect to exist in your favoragainst the Released Parties, or any of them, at the moment  of execution hereof, and that this Agreementexpressly contemplates the extinguishment of all such claims.

 

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