exv10w5









Exhibit 10.5




August 5, 2008




Dear Mr. Rydin,




     This letter agreement confirms the material compensation terms of your continued employment
with NuVasive. This letter agreement supersedes all prior agreements relating to your compensation
arrangements and is in addition to any and all benefits that are made generally available to
NuVasive employees. It is also in addition to benefits available to you as an executive of
NuVasive. Defined terms used herein have the meanings set forth in the attached Appendix of
Defined Terms.



     This letter agreement has no impact on other types of agreements or arrangements between you
and NuVasive, including agreements related to confidentiality, intellectual property ownership,
non-solicitation or non-competition obligations, etc. You agree to continue abiding by all such
arrangements, as well as all NuVasive policies and procedures.



     Your current annual base salary is $300,000, payable in installments in accordance with
NuVasive’s regular payroll practices. Your base salary is subject to change and is reviewed at
least annually. You are eligible to receive a performance bonus on an annual basis. The
performance bonus is determined at the discretion of the Board of Directors and is based on a
combination of company performance and your individual performance. Your current target annual
bonus is 75% — 100% of your base salary (with ability to over-perform), with the actual amount
being determined at the discretion of the Board of Directors. Additionally, the Board of Directors
has established an unvested stock option target for you of 250,000 shares, and to reach that target
has established an intention to grant you an additional 75,000 stock options in early 2009, subject
to individual and company performance and at the Board’s discretion.



     You also have certain severance benefits related to an Involuntary Termination of your
employment or a Change of Control of NuVasive. In the event of an Involuntary Termination of your
employment, you shall be entitled to the Severance Benefit. In the event of a Change of Control of
NuVasive, you shall be entitled to the Change of Control Benefit. In addition, the Section 409A
Terms shall be applicable to the Severance Benefit.



     We look forward to your continued success with NuVasive.



	 	 	 	 	 
	Truly Yours,
	 	 	 	 
	 
	 	 	 	 
	NUVASIVE, INC.
	 	 	 	 
	 
	 	 	 	 
	/s/ Alexis V. Lukianov 
	 	/s/ Eileen  M. More 	 	 
	 

Alexis V. Lukianov

	 	 

Eileen  M. More
	 	 
















 






Page 2 – Compensation Letter



I have read and accept the terms of this letter.




	 	 	 
	/s/ Jeffrey Rydin 
	 	 
	 

     Jeffrey Rydin

	 	 
















 






Defined Terms:



“Change of Control Benefit” is defined as follows: Company Acceleration Plan applies except that,
for these purposes, an involuntary termination shall include a Voluntary Resignation.



“Severance Benefit” upon an Involuntary Termination at any time, severance is equal to 100% of
Compensation. Such amount shall be due and payable immediately upon any such termination and upon
the condition that you execute NuVasive’s standard form of release of claims.



“Change of Control” is defined as either a Change in Control or Fundamental Transaction as
defined in the 2004 Equity Incentive Plan.



“Company Acceleration Plan” is defined as the Company’s policy pursuant to which 50% of all
unvested options under any of the Company’s equity compensation plans (including the 1998 Stock
Option/Stock Issuance Plan and 2004 Equity Incentive Plan) immediately accelerate upon a Change of
Control of the Company, and all remaining stock options immediately accelerate upon an involuntary
termination (except for death, disability or Cause) of service within 18 months following such an
event.



“Compensation” is defined as annual salary and bonus most recently paid (even if not in prior
year).



“Involuntary Termination” is defined as an involuntary Termination (as defined in the 2004 Equity
Incentive Plan) for reasons other than death, disability or Cause. “Cause” is defined as any of
the following: (i) the Executive’s repeated failure to satisfactorily perform the Executive’s job
duties; (ii) the Executive’s refusal or failure to follow lawful directions of the Board; (iii) the
Executive’s conviction of a crime involving moral turpitude; (iv) the Executive engaging or in any
manner participating in any activity which is directly competitive with or injurious to the
Company. The term Involuntary Termination shall include a voluntary resignation by the Executive
following any of the following (each a “Voluntary Resignation”): a significant reduction of the
Executive’s job responsibilities or title, a requirement (refused by the Executive) that the
Executive move for his/her principal place of employment more than 50 miles from the then-current
principal place of employment, or a reduction of greater than 15% in the Executive’s base pay or
bonus opportunity (where not all Executives are similarly affected).



“Section 409A Terms” – the following terms shall be applicable to the Severance Benefit:
Notwithstanding anything in this Agreement to the contrary, no Severance Benefit payable pursuant
to this Agreement which constitutes a “deferral of
compensation” within the meaning of the Treasury Regulations issued pursuant to Section 409A of the
Code (the “Section 409A Regulations”) shall be paid until Executive has incurred a “separation from
service” within the meaning of the Section 409A Regulations. Furthermore, to the extent that
Executive is a “specified employee” within the meaning of the Section 409A Regulations no Severance
Benefit that constitutes a deferral of compensation shall paid to Executive before the date (the
“Delayed Payment Date”) which is first day of the seventh month after the date of Executive’s
separation from service or, if earlier, the date of Executive’s death following












 






such separation
from service. All such amounts that would, but for these defined terms, become payable prior to
the Delayed Payment Date will be accumulated and paid on the Delayed Payment Date. The Company
intends that the Severance Benefit will not be subject to taxation under Section 409A of the Code.
The provisions of this Letter Agreement shall be interpreted and construed in favor of satisfying
any applicable requirements of Section 409A of the Code. However, the Company does not guarantee
any particular tax effect for income provided to Executive pursuant to this Agreement. In any
event, except for the Company’s responsibility to withhold applicable income and employment taxes
from compensation paid or provided to Executive, the Company shall not be responsible for the
payment of any applicable taxes on compensation paid or provided to Executive pursuant to this
Agreement.