Document:

nvro-ex102_277.htm

Exhibit 10.2

NEVRO CORP.

 

Non-Employee DIRECTOR COMPENSATION PROGRAM

 

Non-employee members of the board of directors (the “Board”) of Nevro Corp. (the “Company”) shall be eligible to receive cash and equity compensation as set forth in this Non-Employee Director Compensation Program (this “Program”), as amended by the Board and effective May 20, 2019 (the “Effective Date”).  The cash and equity compensation described in this Program shall be paid or be made, as applicable, automatically and without further action of the Board, to each member of the Board who is not an employee of the Company or any parent or subsidiary of the Company (each, a “Non-Employee Director”) who may be eligible to receive such cash or equity compensation, unless such Non-Employee Director declines the receipt of such cash or equity compensation by written notice to the Company.  This Program shall remain in effect until it is revised or rescinded by further action of the Board.  This Program may be amended, modified or terminated by the Board at any time, without advance notice, in its sole discretion.  The terms and conditions of this Program shall supersede any prior cash and/or equity compensation arrangements for service as a member of the Board between the Company and any of its Non-Employee Directors.  

1.Cash Compensation.  

(a)Annual Retainers.  Each Non-Employee Director shall be eligible to receive an annual retainer of $55,000 for service on the Board.  

(b)Additional Annual Retainers.  In addition, a Non-Employee Director shall receive the following annual retainers:

(i)Non-Executive Chair or Lead Director.  A Non-Employee Director serving as Non-Executive Chair or Lead Director of the Board shall receive an additional annual retainer of $50,000 for such service.  

(ii) Audit Committee.   A Non-Employee Director serving as Chairperson of the Audit Committee shall receive an additional annual retainer of $25,000 for such service.  A Non-Employee Director serving as a member of the Audit Committee (other than the Chairperson) shall receive an additional annual retainer of $12,000 for such service.

(iii)Compensation Committee.  A Non-Employee Director serving as Chairperson of the Compensation Committee shall receive an additional annual retainer of $18,250 for such service.  A Non-Employee Director serving as a member of the Compensation Committee (other than the Chairperson) shall receive an additional annual retainer of $8,000 for such service.

(iv) Nominating and Corporate Governance Committee.   A Non-Employee Director serving as Chairperson of the Nominating and Corporate Governance Committee shall receive an additional annual retainer of $12,000 for such service.  A Non-Employee Director serving as a member of the Nominating and Corporate Governance Committee (other than the Chairperson) shall receive an additional annual retainer of $6,000 for such service.

(c)Payment of Retainers.  The annual retainers described in Sections 1(a) and 1(b) shall be earned on a quarterly basis based on a calendar quarter and shall be paid by the Company in arrears not later than the fifteenth day following the end of each calendar quarter.  In the event a Non-Employee Director does not serve as a Non-Employee Director, or in the applicable positions described in Section 1(b), for an entire calendar quarter, the retainer paid to such Non-Employee Director shall be prorated for 

 

 

 

 

 

 

the portion of such calendar quarter actually served as a Non-Employee Director, or in such position, as applicable. A director may elect, at his or her option, to receive the payment of all or a portion of the annual retainers in the form of Stock Payments (as defined in the Equity Plan (as defined below)) under the Equity Plan. The number of shares of fully vested Company common stock comprising such Stock Payment shall be calculated by dividing (i) the quarterly portion of the annual retainer elected to be received as a Stock Payment (denominated in dollars) by (ii) closing trading price of the Company’s common stock on the last trading day of the applicable fiscal quarter, rounded down to the next whole number of shares. The Stock Payment shall be made on the date the Company makes the payment of the annual retainers.

 

2.Equity Compensation.  Non-Employee Directors shall be granted the equity awards described below.  The awards described below shall be granted under and shall be subject to the terms and provisions of the Company’s 2014 Equity Incentive Award Plan or any other applicable Company equity incentive plan then-maintained by the Company (the “Equity Plan”) and shall be evidenced by the execution and delivery of award agreements, including attached exhibits, in substantially the forms previously approved by the Board.  All applicable terms of the Equity Plan apply to this Program as if fully set forth herein, and all grants of equity awards hereby are subject in all respects to the terms of the Equity Plan.  

(a)Initial Awards.  Each Non-Employee Director who is initially elected or appointed to the Board on or after the Effective Date shall automatically be granted, on the date of such initial election or appointment, an award of restricted stock units (an “Initial Award”) with respect to that number of shares of Company common stock calculated by dividing (x) $300,000 by (y) the per share Fair Market Value (as defined in the Equity Plan) of the Company’s common stock on the date of grant, rounded down to the next whole number of shares. No Non-Employee Director shall be granted more than one Initial Award.  

(b)Annual Awards. A Non-Employee Director who has served at least six (6) months prior to, and will continue to serve as a Non-Employee Director immediately following, any annual meeting of the Company’s stockholders after the Effective Date (an “Annual Meeting”) shall be automatically granted, on the date of such Annual Meeting, an award of restricted stock units (a “Annual Award”) with respect to that number of shares of Company common stock calculated by dividing (x) $175,000 by (y) the per share Fair Market Value (as defined in the Equity Plan) of the Company’s common stock on the date of grant, rounded down to the next whole number of shares.

(c)Pro-rata Awards. Any Non-Employee Director who is elected or appointed to the Board after January 1, 2019 and prior to the Effective Date, shall be granted, on the Effective Date, an award of restricted stock units (a “Pro-rata Award”) with respect to that number of shares of Company common stock calculated by subtracting the number of shares of Company common stock subject to restricted stock units previously granted to the Non-Employee Director from the quotient obtained by dividing (i) $300,000 by (ii) the per share Fair Market Value of the Company’s common stock on the date of the Non-Employee Director was initially elected or appointed to the Board, rounded down to the next whole number of shares.   

(d)Vesting.  Each Initial Award and Pro-Rata Award shall vest in three (3) equal annual installments on the anniversary of the date the Non-Employee Director was initially elected or appointed to the Board, subject to the Non-Employee Director continuing to provide services to the Company through such vesting date. Each Annual Award shall vest in full upon the earlier of (i) the first anniversary of the date of grant or (ii) the next Annual Meeting following the date of grant, subject to the Non-Employee Director continuing to provide services to the Company through such vesting date.  Each Initial Award, Annual Award and Pro-rata Award, along with any other stock options or other equity-based awards held by any Non-Employee Director, shall vest in full immediately prior to the occurrence of a Change in Control (as defined in the Equity Plan), to the extent outstanding at such time.

2

 

 

 

 

	
3.
	
Reimbursements.  The Company shall reimburse each Non-Employee Director for all reasonable, documented, out-of-pocket travel and other business expenses incurred by such Non-Employee Director in the performance of his or her duties to the Company in accordance with the Company’s applicable expense reimbursement policies and procedures as in effect from time to time. 

* * * * *

3nvro-ex103_278.htm

Exhibit 10.3

“[***] Certain information in this document has been excluded pursuant to Regulation S-K, Item 601(b)(10).  Such excluded information is not material and would likely cause competitive harm to the registrant if publicly disclosed.”

FIRST AMENDMENT TO THE SUPPLY AGREEMENT

 

This First Amendment to the Supply Agreement (the “Amendment”) is effective as of April 30, 2019, by and between Nevro Corp., having a mailing address of 1800 Bridge Parkway, Redwood City, CA 94065 (“Nevro”), and Centro De Construccion De Cardioestimuladores Del Uruguay S.A., having an address, at General Paz 1371, Montevideo, Uruguay, CP 11400 (“CCC”).

 

WHEREAS, Nevro and CCC are parties to that certain Supply Agreement, dated effective as of November 11, 2016 (the “Agreement”), whereby CCC provides certain services as described; and 

 

WHEREAS, the parties wish to amend the Agreement, as further set forth below; 

 

NOW, THEREFORE, in consideration of the mutual promises, covenants and agreements set forth, the parties agree:

 

SECTION 1: Amendment to the Agreement

 

	
 
	
(a)
	
Add the following definitions in the Agreement as Subsection 1.1 and 1.2 respectively: 

 

1.39“PCBA” shall mean Printed Circuit Board Assembly.

 

1.40“[***]” shall mean [***].

 

	
 
	
(b)
	
Add the following paragraph as Section 3.7 in the Agreement: 

 

3.7PCBA Rejections. In the event that CCC rejects PCBAs in accordance with section 3.6 (d) of this Agreement, but [***], CCC will notify Nevro immediately and Nevro shall [***]. 

	
 
	
(c)
	
Exhibit A of the Agreement is hereby amended by replacing it in its entirety with Appendix I attached hereto. 

 

	
 
	
(d)
	
Exhibit B of the Agreement is hereby amended by replacing it in its entirety with Appendix II attached hereto. 

 

	
 
	
(e)
	
Exhibit F of the Agreement is hereby amended by replacing it in its entirety with Appendix III attached hereto. 

 

 

 

 

	
 
	
(e)
	
The Agreement is hereby amended by adding Exhibit G attached hereto as Appendix IV.

	
 
	
(f)
	
The Agreement is hereby amended by adding Exhibit H attached hereto as Appendix V. 

 

SECTION 2: Confirmation of the Agreement

 

Except as set forth in this Amendment, this Amendment shall not by implication or otherwise, limit, impair, constitute a waiver of, or otherwise affect the rights, remedies, duties and obligations of Nevro or CCC under the Agreement.

 

SECTION 3: Miscellaneous

 

	
 
	
(a)
	
Counterparts. This Amendment may be executed in two or more counterparts, each of which shall be deemed an original and all of which shall constitute the same instrument.

 

	
 
	
(b)
	
Entire Agreement. Regarding the subject matter above, this Amendment shall supersede anything to the contrary in the Agreement. 

 

	
 
	
(c)
	
Terms Not Defined. Terms not defined herein shall have the meaning assigned to them in the Agreement.

 

[Remainder of page left intentionally blank.]

 

 

2

 

 

 “[***] Certain information in this document has been excluded pursuant to Regulation S-K, Item 601(b)(10).  Such excluded information is not material and would likely cause competitive harm to the registrant if publicly disclosed.”

IN WITNESS WHEREOF, the parties have caused this Amendment to be executed by their duly authorized representatives as of the date first written above.

 

	
 
	
 
	
 
	
 

	
 
	
Nevro Corp.
	
 
	
Centro De Construccion de

	
 
	
 
	
 
	
Cardioestimuladores Del Uruguay S.A.

	
 
	
 
	
 
	
 

	
 
	
/s/ Andrew Galligan
	
 
	
/s/ Antonio Gonzalez

	
 
	
Signature
	
 
	
Signature

	
 
	
 
	
 
	
 

	
 
	
Andrew Galligan
	
 
	
Antonio Gonzalez

	
 
	
Name
	
 
	
Name

	
 
	
 
	
 
	
 

	
 
	
Chief Financial Officer
	
 
	
President, CRMN

	
 
	
Title
	
 
	
Title

	
 
	
 
	
 
	
 

	
 
	
5/1/2019
	
 
	
April 30, 2019

	
 
	
Date
	
 
	
Date

 

 

 

 

 

 “[***] Certain information in this document has been excluded pursuant to Regulation S-K, Item 601(b)(10).  Such excluded information is not material and would likely cause competitive harm to the registrant if publicly disclosed.”

APPENDIX I

 

Exhibit A

Products

For IPG 1500, IPG 2000 and IPG 2500:

			
	
PRODUCTS
	
Minimum Purchase Thresholds
	
Lead Time

	
[***]
	
[***]
	
[***]

	
[***]
	
[***]
	
[***]

	
[***]
	
[***]
	
[***]

Pricing For IPG Model 1500:

		
	
IPG Model 1500

CCC P/N 999391

	
Product Unit Year
	
Price

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

 

The prices in the table above reflect incremental volume pricing (for example, the price for the first [***] units in a Contract Year is $[***] per unit and the price for the next [***] units is $[***] per unit in that Contract Year). The IPG volumes above are measured by the volumes of units ordered during a Contract Year.

 

 

 

 “[***] Certain information in this document has been excluded pursuant to Regulation S-K, Item 601(b)(10).  Such excluded information is not material and would likely cause competitive harm to the registrant if publicly disclosed.”

Pricing For IPG Model 2000 and IPG Model 2500:

Subject to the terms and conditions of the Agreement, Nevro commits to a Minimum Purchase Threshold of [***]% of the IPG Model 2000 and IPG Model 2500 worldwide requirements through the term of the Agreement.  Nevro’s Forecast provided on or about December 31 of each year shall include Nevro’s projected volume of Products and share commitment for the IPG Model 2000 and IPG Model 2500 Product for the following Contract Year.  Nevro’s price per Product for each IPG Model 2000 and IPG Model 2500 Product for such Contract Year shall be determined based upon such projected volume and share commitment in accordance with the following tables:

 

				
	
Annual Units of Product

(Year [***]) 
	
[***]% share
commitment
	
[***]% share

commitment
	

[***]% share 
commitment

	
PRICE

	
[***]
	
$[***]
	
$[***]
	
$[***]

	
[***]
	
$[***]
	
$[***]
	
$[***]

	
[***]
	
$[***]
	
$[***]
	
$[***]

	
[***]
	
$[***]
	
$[***]
	
$[***]

	
[***]
	
$[***]
	
$[***]
	
$[***]

 

For [***] only, Nevro will purchase the first [***] units of IPG Model 2000 at [***] Unit Volume Price (ref. $[***]) and the remainder of the IPG Model 2000 and Model 2500 units shipped in [***] will be at the [***] pricing tier (ref. $[***]).  Volumes considered above are the combination of IPG Model 2000 and Model 2500.  The [***] prices include a [***]% yield factor for [***] only.  

 

For year [***] and thereafter through the Term, the following table will be used to determine IPG Model 2000 and Model 2500 pricing.

				
	
Annual Units of Product

(Year [***]+) 
	
[***]% share
commitment
	
[***]% share

commitment
	

[***]% share 
commitment

	
PRICE

	
[***]
	
$[***]
	
$[***]
	
$[***]

	
[***]
	
$[***]
	
$[***]
	
$[***]

	
[***]
	
$[***]
	
$[***]
	
$[***]

	
[***]
	
$[***]
	
$[***]
	
$[***]

 

 

				
	
[***]
	
$[***]
	
$[***]
	
$[***]

Volumes considered above are the combination of IPG Model 2000 and Model 2500.

 

On or about September 1 of each Contract Year, the parties shall meet to review the next Contract Year Forecast and Nevro commitment and the per unit price for the Products for the next Contract Year will be determined using the initial forecasted volume’s price per the appropriate pricing tier set out above. If the forecasted volume is within [***]% of Products of the next tier’s volume break, the parties agree to set the initial pricing at the higher price (i.e., lower volume) and review such pricing twice per year for any material changes in the Forecast. A credit will be issued to Nevro immediately and the per unit price will be reset once shipments scheduled for delivery during the binding portion of the Forecast (pursuant to Section 2.1) exceed the current volume/pricing tier and subsequent Purchase Orders scheduled for delivery during the same Contract Year would be placed at the lower price (i.e., higher volume pricing tier).  In the event that Nevro purchases in any Contract Year an amount of Products which is less than the initial Forecast for such Contract Year and the total amount of Products purchased during such Contract Year is in a higher price tier than the price tier offered based on the initial Forecast for such Contract Year, Nevro shall make a payment to CCC, by the end of such Contract Year, an amount equal to [***].

Certain Price Adjustments.  If Nevro agrees to purchase from CCC or any of its Affiliates a minimum of [***] percent ([***]%) of its finished leads products in a Contract Year, Nevro shall receive an additional [***] percent ([***]%) reduction in price for each IPG Model 2000 Product and IPG 2500 Product ordered in accordance with such Forecast.  

 

 

 

 

 

APPENDIX II

 

Exhibit B

Specifications

Omitted pursuant to Regulation S-K, Item 601(a)(5).

 

 

 

 

 

 

 

 

 “[***] Certain information in this document has been excluded pursuant to Regulation S-K, Item 601(b)(10).  Such excluded information is not material and would likely cause competitive harm to the registrant if publicly disclosed.”

APPENDIX III

 

Exhibit F

Bill of Materials

Omitted pursuant to Regulation S-K, Item 601(a)(5).

 

 

 

 

 

 

APPENDIX IV

 

Exhibit G

 

Additional Services

 

At Nevro's request, CCC will provide the following services with respect to the Products and implantable pulse generators substantially similar to the implantable pulse generator Products (“Third Party IPGs”):

 

	
1.
	
Expedite complaint investigation and follow-up, according to the following criteria*:

	
 
	
o
	
Nevro shall complete an initial investigation of any Defective Products or defective Third Party IPGs, as the case may be. If upon completion of this initial investigation, a decision is made to send a Defective Product or defective Third Party IPG to CCC for further analysis, Nevro shall send such Defective Product or defective Third Party IPG to CCC with all relevant information related thereto, including, but not limited to, Nevro’s initial investigation. 

	
 
	
o
	
In the event that Nevro (i) requests an RMA# from CCC to return a Product that Nevro reasonably believes to be a Defective Product or (ii) desires to send a Third Party IPG to CCC that it reasonably believes to be defective, Nevro shall provide the following information to CCC together with the request: the patient’s complaint, if verified by Nevro ́s personnel, a description of the conditions the Product or Third Party IPG, as applicable, worked and when the defect appeared, programmer logs (if the involved Product or Third Party IPG is an IPG), and any other information reasonably requested by CCC.  

	
 
	
o
	
With the goal of enabling Nevro to close complaints within [***] days; CCC will target submission of a draft report of complaint investigations with known causes within [***] days from receipt of the Product or Third Party IPG, as applicable.

	
 
	
o
	
Complaint handling and meeting regulatory requirements for reporting and assessing complaints is the responsibility of Nevro and CCC shall have no obligation related thereto other than to provide reasonable assistance to Nevro at Nevro's request where CCC has information, or otherwise provided products or services, related to such requirement or complaint.

 

*CCC may charge the fees described in EXHIBIT H with respect to these services, provided that CCC may not charge such fees for any such services provided in connection with a Defective Product that fails to meet the limited warranty in Section 10.3(a) due solely to the acts or omissions of CCC.

 

 

 

 

APPENDIX V

 

Exhibit H

 

Fees for Additional Services

In addition to any other fees to be paid by Nevro under this Agreement, CCC may charge the following fees with respect to the services listed in #1 of EXHIBIT G.

 

[***]

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