Document:

Exhibit

Exhibit 10.2

FORM OF EXECUTIVE CHANGE IN CONTROL AGREEMENT

This Executive Change in Control Agreement (this “Agreement”), is made as of the 2ND day of May, 2018 (the “Effective Date”), by and between Advanced Energy Industries, Inc., a Delaware corporation (the “Company”), and Paul Oldham (the “Executive”).
Recitals
A. The Executive is expected to serve as the Executive Vice President and Chief Financial Officer of the Company.
B. The Board of Directors of the Company (the “Board”) acknowledges that consolidation within the industries in which the Company operates is likely to continue and the potential for a change in control of the Company, whether friendly or hostile, currently exists and from time to time in the future will exist, which potential can give rise to uncertainty among the senior executives of the Company. The Board considers it essential to the best interests of the Company to reduce the risk of the Executive’s departure and/or the inevitable distraction of the Executive’s attention from his duties to the Company, which are normally attendant to such uncertainties.
C.  The Executive confirms that the terms of this Agreement reduce the risks of his departure and distraction of his attention from his duties to the Company and, accordingly, desires to enter into this Agreement.
Agreement
              In consideration of the foregoing and the mutual covenants contained herein, the Company and the Executive agree as follows:
              1. Definitions. Capitalized terms used herein shall have the meanings given to them in Annex A attached hereto, except where the context requires otherwise.
              2. Term of Agreement.
This Agreement shall be effective as of the Effective Date and shall continue in effect until the first anniversary of the Effective Date (the “ Initial Expiration Date ”),  provided,  however , that the term of this Agreement automatically shall be extended for one additional year effective as of the Initial Expiration Date and each anniversary thereof (each, a “ Scheduled Expiration Date ”), unless either the Company or the Executive provides written notice to the other that the term of this Agreement shall terminate on the upcoming Scheduled Expiration Date,  provided  such notice is received by the receiving party not less than ninety (90) days prior to the applicable Scheduled Expiration Date, and  provided further  that the Company shall not be entitled to deliver to the Executive such notice in the event of a Change in Control or a Pending Change in Control. Notwithstanding the foregoing, this Agreement shall terminate immediately upon the termination of the Executive’s employment prior to a Change in Control or upon mutual written agreement of Executive and the Company.  
 
              3. At Will Employment; Reasons for Termination.
The Executive’s employment shall continue to be at-will, as defined under applicable law. If the Executive’s employment terminates for any reason or no reason, the Executive shall not be entitled to any compensation, benefits, damages, awards or other payments in respect of such termination, except as provided in this Agreement or pursuant to the terms of any Applicable Benefit Plan. “Applicable Benefit Plan” means any written employee benefit plan in effect and in which the Executive participates as of the time of the termination of his employment.
              4. Benefits Upon Separation.
              (a) Compensation and Benefits Required by Law or Applicable Benefit Plan. Notwithstanding anything to the contrary herein, the Executive or his estate shall be entitled to any and all compensation, benefits, awards and other payments required by any Applicable Benefit Plan, the COBRA Act or other applicable law, after taking into account the agreements set forth herein.

              (b) No Payments Without Release. The Executive shall not be entitled to any of the compensation (other than Accrued Compensation), benefits or other payments provided herein in respect of the termination of his employment, unless and until he has provided to the Company a full release of claims, substantially in the form of Appendix I attached hereto, which release shall be dated not earlier than the date of the termination of his employment, which release shall be executed within 30 days of Executive’s termination of employment.
             (c) Voluntary Resignation or Termination for Cause.
                      (i) In the event of the Executive’s Voluntary Resignation or termination of his employment by the Company for Cause, the Executive shall not be entitled to any compensation, benefits, awards or other payments in connection with such termination of his employment, except as provided in paragraph (a) of this Section 4.
                    (ii) The Executive shall not be deemed to have been terminated for Cause under this Agreement, unless the following procedures have been observed: To terminate the Executive for Cause, the Board must deliver to the Executive notice of such termination in writing, which notice must specify the facts purportedly constituting Cause in reasonable detail. The Executive will have the right, within 10 calendar days of receipt of such notice, to submit a written request for review by the Board. If such request is timely made, within a reasonable time thereafter, the Board (with all directors attending in person or by telephone) shall give the Executive the opportunity to be heard (personally or by counsel). Following such hearing, unless a majority of the directors then in office confirm that the Executive’s termination was for Cause, the Executive’s termination shall be deemed to have been made by the Company without Cause for purposes of this Agreement.
             (d) Death or Long-Term Disability. In the event of the Executive’s death or Long-Term Disability, the Executive (or his estate or personal representative) shall be entitled to receive (i) the proceeds of any life insurance policy carried by the Company with respect to the Executive, or (ii) payments pursuant to any long-term disability insurance policy carried by the Company with respect to the Executive, as applicable. 
             (e) Involuntary Termination. In the event Executive’s employment is terminated under circumstances constituting an Involuntary Termination, the Executive shall be entitled to receive:
                    (i) within fifteen (15) calendar days after the Date of Termination, the Executive’s Accrued Compensation and Pro-Rata Bonus through the Date of Termination; and
                    (ii) within fifteen (15) calendar days after the period for revocation of the release has elapsed, the amount in cash equal to the sum of (x) one (1) times the Executive’s annual Base Salary and (y) the Executive’s Target Bonus in effect as of the Date of Termination; and
                    (iii) for eighteen (18) months after the period for revocation of the release has elapsed continuation of the Benefits, as if the Executive’s employment had not been terminated; provided, however, that if the Executive commences employment with another employer during such eighteen (18) month period and is eligible to receive medical benefits under the new employer’s plan(s), the Benefits shall terminate as of the date the Executive becomes eligible to receive such benefits;
                    (iv) within fifteen (15) calendar days after the after the period for revocation of the release has elapsed, an amount equal to the contributions to the Company’s retirement plans on behalf of the Executive that would have been made for the benefit of the Executive if the Executive’s employment had continued for twelve (12) months after the Date of Termination, assuming for this purpose that all benefits under any such retirement plans were fully vested and that the Executive’s compensation during such twelve (12) months were the same as it had been immediately prior to the Date of Termination; and
                    (v) reimbursement, up to $4,870, for outplacement services reasonably selected by the Executive incurred by the end of the second calendar year after termination of employment such reimbursement to occur by the end of the following calendar year.

              5. Effect on Option and Restricted Unit Agreements.
              (a) In the event Options held by the Executive are assumed by the surviving entity in connection with a Change in Control, if an Involuntary Termination of Executive’s employment occurs following the Change of Control before the end of the CIC Period, vesting of any and all assumed Options held by the Executive shall be accelerated so that all unexpired Options then held by the Executive shall be fully vested and exercisable immediately upon the Involuntary Termination.
             (b) In the event RSUs held by the Executive are assumed by the surviving entity in connection with a Change in Control, if an Involuntary Termination of Executive’s employment occurs following the Change of Control before the end of the CIC Period, vesting of any and all assumed RSUs held by the Executive shall be accelerated so that all RSUs then held by the Executive shall be fully vested and exercisable immediately upon the Involuntary Termination. 
             (c) The termination of the Executive’s employment by the Company without Cause during a Pending Change in Control shall have no effect on the vesting of the Options, RSUs then held by the Executive, and no shares of Common Stock shall be delivered to the Executive in connection with the RSUs held by the Executive at the time of the termination of his employment unless the Change in Control is effected within three (3) months following the Date of Termination. If the Change in Control is effected, then the Options and RSUs held by the Executive as of the Date of Termination shall be treated as if the Executive’s employment had not been terminated and the Executive shall have rights as set forth under Section 5(a) above. If the Change in Control is not effected within three (3) months following the Date of Termination, then the Options and RSUs held by the Executive as of the Date of Termination shall be treated as if the Executive’s employment had been terminated as of such three-month anniversary of the Date of Termination.
             (d) In the event the Executive’s employment is terminated by the Company under any circumstances other than those described in paragraphs (a) through (c) of this Section 5, the effect of such termination of employment on the Options and/or RSUs then held by the Executive shall be as set forth in the agreements representing such Options and/or RSUs.
              6. Mitigation. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement, and except as set forth in Section 4, such amounts shall not be reduced whether or not the Executive obtains other employment.
              7. Successors.
               (a) This Agreement is personal to the Executive, and, without the prior written consent of the Company, shall not be assignable by the Executive other than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
           (b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.
              (c) The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.
              8. Miscellaneous.
              (a) The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement constitutes the entire agreement and understanding of the parties in respect of the subject matter hereof and supersedes all prior understanding, agreements, or representations by or among the parties, written or oral, to the extent they relate in any away to the subject matter hereof; provided, however, this Agreement shall have no effect on any confidentiality agreements or assignment of inventions agreements between the parties. This Agreement may not be amended or modified other than by a written agreement executed by the parties hereto or their respective successors and legal representatives.
             (b) All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

          if to the Executive:
  
Paul Oldham 
              16929 SW Arbutus Drive
               Beaverton, OR 97007

          if to the Company:
Advanced Energy Industries, Inc.
1625 Sharp Point Drive
     Fort Collins, CO 80525
     Attention: General Counsel
or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.
      (c) The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.
          (d) The Company may withhold from any amounts payable under this Agreement such United States federal, state or local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
           (e) The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
           (f) All claims by the Executive for payments or benefits under this Agreement shall be promptly forwarded to and addressed by the Compensation Committee and shall be in writing. Any denial by the Compensation Committee of a claim for benefits under this Agreement shall be delivered to the Executive in writing and shall set forth the specific reasons for the denial and the specific provisions of this Agreement relied upon. The Compensation Committee shall afford the Executive a reasonable opportunity for a review of the decision denying a claim and shall further allow the Executive make a written demand upon the Company to submit the disputed matter to arbitration in accordance with the provisions of paragraph (g) below. The Company shall pay all expenses of the Executive, including reasonable attorneys and expert fees, in connection with any such arbitration. If for any reason the arbitrator has not made his award within one hundred eighty (180) days from the date of Executive’s demand for arbitration, such arbitration proceedings shall be immediately suspended and the Company shall be deemed to have agreed to Executive’s position. Thereafter, the Company shall, as soon as practicable and in any event within 10 business days after the expiration of such 180-day period, pay Executive his reasonable expenses and all amounts reasonably claimed by him that were the subject of such dispute and arbitration proceedings.
          (g) Subject to the terms of paragraph (f) above, any dispute arising from, or relating to, this Agreement shall be resolved at the request of either party through binding arbitration in accordance with this paragraph (g). Within 10 business days after demand for arbitration has been made by either party, the parties, and/or their counsel, shall meet to discuss the issues involved, to discuss a suitable arbitrator and arbitration procedure, and to agree on arbitration rules particularly tailored to the matter in dispute, with a view to the dispute’s prompt, efficient, and just resolution. Upon the failure of the parties to agree upon arbitration rules and procedures within a reasonable time (not longer than 15 business days from the demand), the Commercial Arbitration Rules of the American Arbitration Association shall be applicable. Likewise, upon the failure of the parties to agree upon an arbitrator within a reasonable time (not longer than 15 business days from demand), there shall be a panel comprised of three arbitrators, one to be appointed by each party and the third one to be selected by the two arbitrators jointly, or by the American Arbitration Association, if the two arbitrators cannot decide on a third arbitrator. At least 30 days before the arbitration hearing (which shall be set for a date no later than 60 days from the demand), the parties shall allow each other reasonable written discovery including the inspection and copying of documents and other tangible items relevant to the issues that are to be presented at the arbitration hearing. The arbitrator(s) shall be empowered to decide any disputes regarding the scope of discovery. The award rendered by the arbitrator(s) shall be final and binding upon both parties. The arbitration shall be conducted in Larimer County in the State of Colorado. The Colorado District Court located in Larimer County shall have exclusive 

jurisdiction over disputes between the parties in connection with such arbitration and the enforcement thereof, and the parties consent to the jurisdiction and venue of such court for such purpose.
         (h) This Agreement shall be governed by the laws of the State of Colorado, without giving effect to any choice of law provision or rule (whether of the State of Colorado or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Colorado.
              9. Other Terms Relating to Section 409A
            (a) Except as provided in Section 9(b), amounts payable under this Agreement following Executive’s termination of employment, other than those expressly payable on a deferred or installment basis or as reimbursement of expenses, will be paid as promptly as practicable after such a termination of employment and, in any event, within 2 1 / 2  months after the end of the year in which employment terminates and amounts payable as reimbursements of expenses to the Executive must be made on or before the last day of the calendar year following the calendar year in which such expense was incurred.
             (b) Anything in this Agreement to the contrary notwithstanding, if (A) on the date of termination of Executive’s employment with the Company or a subsidiary, any of the Company’s stock is publicly traded on an established securities market or otherwise (within the meaning of Section 409A(a)(2)(B)(i) of the Internal Revenue Code, as amended (the “Code”)), (B) if Executive is determined to be a “specified employee” within the meaning of Section 409A(a)(2)(B) of the Code, (C) the payments exceed the amounts permitted to be paid pursuant to Treasury Regulations section 1.409A-1(b)(9)(iii) and (D) such delay is required to avoid the imposition of the tax set forth in Section 409A(a)(1) of the Code, as a result of such termination, the Executive would receive any payment that, absent the application of this Section 9(b), would be subject to interest and additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(2)(B)(i) of the Code, then no such payment shall be payable prior to the date that is the earliest of (1) six (6) months after the Executive’s termination date, (2) the Executive’s death or (3) such other date as will cause such payment not to be subject to such interest and additional tax (with a catch-up payment equal to the sum of all amounts that have been delayed to be made as of the date of the initial payment).
            (c) It is the intention of the parties that payments or benefits payable under this Agreement not be subject to the additional tax imposed pursuant to Section 409A of the Code. To the extent such potential payments or benefits could become subject to such Section, the parties shall cooperate to amend this Agreement with the goal of giving the Executive the economic benefits described herein in a manner that does not result in such tax being imposed.
            (d) A termination of employment under this Agreement shall be deemed to occur only in circumstances that would constitute a separation from service for purposes of Treasury Regulations section 1.409A-1(h)(1)(ii).
            (e) Wherever payments under this Agreement are to be made in installments, each such installment shall be deemed to be a separate payment for purposes of Section 409A.
[Signature Page Follows]

 
          IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth in the Preamble hereto.
	
				
	 
	 
	 
	 

	 
	 
	Advanced Energy Industries, Inc.

	 
	 
	 
	 

	 
	By:
	 
	 

	 
	 
	 
	Authorized Officer

	 
	 
	 
	 

	 
	 
	 
	 

	 
	 
	Executive

	 
	 
	 
	 

	 
	By:
	 
	 

	 
	 
	 
	Paul Oldham

 
ANNEX A
DEFINITIONS
                (a) “Accrued Compensation” means an amount including all amounts earned or accrued through the Date of Termination but not paid as of the Date of Termination including (i) Base Salary, (ii) reimbursement for reasonable and necessary expenses incurred by the Executive on behalf of the Company during the period ending on the Date of Termination, (iii) vacation and sick leave pay (to the extent provided by Company policy or applicable law), and (iv) incentive compensation (if any) earned in respect of any period ended prior to the Date of Termination. It is expressly understood that incentive compensation shall have been “earned” as of the time that the conditions to such incentive compensation have been met, even if not calculated or payable at such time.
                (b) “Agreement” means this Executive Change in Control Agreement, as set forth in the Preamble hereto.
                (c) “Applicable Benefit Plan” means any written employee benefit plan in effect and in which the Executive participates as of the time of the termination of his employment.
             (d) “Base Salary” means the Executive’s annual base salary at the rate in effect during the last regularly scheduled payroll period immediately preceding the occurrence of the Change in Control or termination of employment and does not include, for example, bonuses, overtime compensation, incentive pay, fringe benefits, sales commissions or expense allowances.
                (e) “Board” means the Board of Directors of the Company, as set forth in the Recitals hereto.
                (f) “Capital Stock” means capital stock of the Company or any of its subsidiaries.
                (g) “Cause” means any of the following:
                    (i) the Executive’s (A) conviction of a felony; (B) commission of any other material act or omission involving dishonesty or fraud with respect to the Company or any of its Affiliates or any of the customers, vendors or suppliers of the Company or its Affiliates; (C) misappropriation of material funds or assets of the Company for personal use; or (D) engagement in unlawful harassment or unlawful discrimination with respect to any employee of the Company or any of its subsidiaries;
                    (ii) the Executive’s continued substantial and repeated neglect of his duties, after written notice thereof from the Board, and such neglect has not been cured within 30 days after the Executive receives notice thereof from the Board;
                    (iii) the Executive’s gross negligence or willful misconduct in the performance of his duties hereunder that is materially and demonstrably injurious to the Company; or 
                    (iv) the Executive’s engaging in conduct constituting a breach of his written obligations to the Company in respect of confidentiality and/or the use or ownership of proprietary information.
  (h) “Change in Control” shall be deemed to occur upon the consummation of any of the following transactions, unless the only parties to the transaction are the Company and/or one or more of its direct or indirect majority-owned subsidiaries and/or one or more companies directly or indirectly owning a majority interest in the Company immediately prior to the transaction:
                   (i)    a merger or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the state of the Company’s incorporation or a transaction in which 50% or more of the surviving entity’s outstanding voting stock following the transaction is held by holders who held 50% or more of the Company’s outstanding voting stock prior to such transaction; or
                  (ii)    the sale, transfer or other disposition of all or substantially all of the assets of the Company; or

                  (iii)    any reverse merger in which the Company is the surviving entity, but in which 50% or more of the Company’s outstanding voting stock is transferred to holders different from those who held the stock immediately prior to such merger; or
                  (iv)    the acquisition by any person (or entity), other than Douglas Schatz and/or any of his affiliates or members of his immediate family, directly or indirectly of 50% or more of the combined voting power of the outstanding shares of Common Stock.
                (i) “CIC Period” means the twelve (12) month period following the effective date of a Change in Control.
                (j) “Code” means the Internal Revenue Code of 1986, as amended.
                (k) “Common Stock” means common stock, par value $0.001, of the Company.
                (l) “Company” means Advanced Energy Industries, Inc., a Delaware corporation, as set forth in the Preamble hereto.
                (m) “Date of Termination” means (i) if the Executive’s employment is terminated for Cause, the date of receipt by the Executive of written notice from the Board or the Chief Executive Officer that the Executive has been terminated, or any later date specified therein, as the case may be, (ii) if the Executive’s employment is terminated by the Company other than for Cause, death or Long-Term Disability, the date specified in the Company’s written notice to the Executive of such termination, (iii) if the Executive’s employment is terminated by reason of the Executive’s death or Long-Term Disability, the date of such death or the effective date of such Long-Term Disability, (iv) if the Executive’s employment is terminated by Executive’s resignation that constitutes Involuntary Termination under this Agreement, the date of the Company’s receipt of the Executive’s notice of termination or any later date specified therein.
                (n) “Effective Date” means the date set forth in the Preamble hereto.
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                (o) “Executive” means the individual identified in the Preamble hereto.
                (p) “Good Reason” means any of the following:
                         (i) a material reduction in the Executive’s duties, level of responsibility or authority, other than (A) a change in title only, or (B) isolated incidents that are promptly remedied by the Company; or
                    (ii) a material reduction in the Executive’s Base Salary, without (A) the Executive’s express written consent or (B) an increase in the Executive’s benefits, perquisites and/or guaranteed bonus, which increase(s) have a value reasonably equivalent to the reduction in Base Salary; or
                      (iii) a material reduction in the Executive’s Target Bonus, without (A) the Executive’s express written consent or (B) an corresponding increase in the Executive’s Base Salary; or
                        (iv) the relocation of the Executive’s principal place of business to a location more than thirty-five (35) miles from the Executive’s principal place of business immediately prior to the Change in Control, without the Executive’s express written consent; or
                        (v) the Company’s (or its successor’s) material breach of this Agreement.
               (q) “Involuntary Termination” means the termination of Executive’s employment with the Company at the time of or following a Change in Control before the end of the CIC Period:
                    (i) by the Company without Cause, or
                    (ii) by the Executive for Good Reason.
             (r) “Long-Term Disability” is defined according to the Company’s insurance policy regarding long-term disability for its employees.
                (s) “Option” means options to purchase Capital Stock granted by the Company or any of its subsidiaries under a compensation plan adopted or approved by the Company.
               (t) A “Payment” means any payment or distribution in the nature of compensation (within the meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Executive, whether paid or payable pursuant to this Agreement or otherwise.
                (u) “Pending Change in Control” means that one or more of the following events has occurred and a Change in Control pursuant thereto is reasonably expected to be effected within 90 days of the date as of the determination as to whether there is a Pending Change in Control: (i) the Company executes a letter of intent, term sheet or similar instrument with respect to a transaction or series of transactions, the consummation of which transaction(s) would result in a Change in Control; (ii) the Board approves a transaction or series of transactions, the consummation of which transaction(s) would result in a Change in Control; or (iii) a person makes a public announcement of tender offer for the Common Stock, the
A-iii
 

 
completion of which would result in a Change in Control. A Pending Change in Control shall cease to exist upon a Change in Control.
               (v) “Pro Rata Bonus” means an amount equal to 100% of the Target Bonus that the Executive would have been eligible to receive for the Company’s fiscal year in which the Executive’s employment terminates following a Change in Control, multiplied by a fraction, the numerator of which is the number of days in such fiscal year through the Termination Date and the denominator of which is 365.
                (w) “RSUs” means restricted stock units granted by the Company pursuant to which the Company has the right to issue Common Stock upon the satisfaction of vesting and other conditions, which RSUs are subject to an award agreement pursuant to a stock plan of the Company.
               (x) “Target Bonus” means the bonus which would have been paid to the Executive for full achievement of specific performance objectives pertaining to the business of the Company or any of its specific business units or divisions, or to individual performance criteria applicable to the Executive or his position, which objectives have been established by the Board of Directors (or the Compensation Committee thereof) for the Executive relating to such plan or budget for the year in question. “Target Bonus” shall not mean the “maximum bonus” which the Executive might have been paid for overachievement of such plan.
               (y) “Value” of a Payment means the economic present value of a Payment as of the date of the change of control for purposes of Section 280G of the Code, as determined by the Accounting Firm using the discount rate required by Section 280G(d)(4) of the Code.
               (z) “Voluntary Resignation” means the termination of the Executive’s employment upon his voluntary resignation, which includes retirement, as set forth in Section 3 hereof.
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APPENDIX I
Legal Release
     This Legal Release (“Release”) is between Advanced Energy Industries, Inc. (the “Company”) and Paul Oldham (“ Executive ”) (each a “ Party ,” and together, the “ Parties ”).
Recitals
     A. Executive and the Company are parties to an Executive Change In Control Agreement to which this Release is appended as Appendix I (the “CIC Agreement”).
     B. Executive wishes to receive the compensation, benefits, awards and other payments described in the CIC Agreement.
     C. Executive and the Company wish to resolve, except as specifically set forth herein, all claims between them arising from or relating to any act or omission predating the Final Separation Date of [                      ].
Agreement
     The Parties agree as follows:
     Confirmation of CIC Agreement Obligations. The Company shall pay or provide to Executive the payments and benefits, as, when and on the terms and conditions specified in the CIC Agreement.
Legal Releases
          (a) Executive, on behalf of Executive and Executive’s heirs, personal representatives and assigns, and any other person or entity that could or might act on behalf of Executive, including, without limitation, Executive’s counsel (all of whom are collectively referred to as “Executive Releasers”), hereby fully and forever releases and discharges the Company, its present and future affiliates and subsidiaries, and each of their past, present and future officers, directors, employees, shareholders, independent contractors, attorneys, insurers and any and all other persons or entities that are now or may become liable to any Releaser due to any Releasee’s act or omission, (all of whom are collectively referred to as “Executive Releasees”) of and from any and all actions, causes of action, claims, demands, costs and expenses, including attorneys’ fees, of every kind and nature whatsoever, in law or in equity, whether now known or unknown, that Executive Releasers, or any person acting under any of them, may now have, or claim at any future time to have, based in whole or in part upon any act or omission occurring on or before the Final Separation Date, without regard to present actual knowledge of such acts or omissions, including specifically, but not by way of limitation, matters which may arise at common law, such as breach of contract, express or implied, promissory estoppel, wrongful discharge, tortious interference with contractual rights, infliction of emotional distress, defamation, or under federal, state or local laws, such as the Fair Labor Standards Act, the Employee Retirement Income Security Act, the National Labor Relations Act, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Rehabilitation Act of 1973, the Equal Pay Act, the Americans with Disabilities Act, the Family and Medical Leave Act, and any civil rights law of any state or other governmental body; PROVIDED, HOWEVER, that notwithstanding the foregoing or anything else contained in this Agreement, the release set forth in
A-v

 
this Section shall not extend to: (i) any rights arising under this Agreement; or; (ii) any vested rights under any pension, retirement, profit sharing or similar plan; (iii) Executive’s rights, if any, to indemnification, and/or defense under any Company certificate of incorporation, bylaw and/or policy or procedure, or under any insurance contract, in connection with Executive’s acts and omissions within the course and scope of Executive’s employment with the Company; or (iv) any rights or remedies that cannot by law be waived by private agreement. Executive hereby warrants that Executive has not assigned or transferred to any person any portion of any claim which is released, waived and discharged above. Executive further states and agrees that Executive has not experienced any illness, injury, or disability that is compensable or recoverable under the worker’s compensation laws of any state that was not reported to the Company by Executive before the Final Separation Date. Executive has specifically consulted with counsel with respect to the agreements, representations, and declarations set forth in the previous sentence. Executive understands and agrees that by signing this Agreement Executive is giving up any right to bring any legal claim against the Company concerning, directly or indirectly, Executive’s employment relationship with the Company, including Executive’s separation from employment. Executive agrees that this legal release is intended to be interpreted in the broadest possible manner in favor of the Company, to include all actual or potential legal claims that Executive may have against the Company, except as specifically provided otherwise in this Agreement.
          (b) In order to provide a full and complete release, Executive understands and agrees that this Agreement is intended to include all claims, if any, covered under this Section 2 that Executive may have and not now know or suspect to exist in Executive’s favor against any Executive Releasee and that this Agreement extinguishes such claims. Thus, Executive expressly waives all rights under any statute or common law principle in any jurisdiction that provides, in effect, that a general release does not extend to claims which the releasing party does not know or suspect to exist in Executive’s favor at the time of executing the release, which if known by Executive must have materially affected Executive’s settlement with the party being released. Notwithstanding any other provision of this Section 2, however, nothing in this Section 2 is intended or shall be construed to limit or otherwise affect in any way Executive’s rights under this Agreement.
          (c) Executive agrees and acknowledges that Executive: (i) understands the language used in this Agreement and the Agreement’s legal effect; (ii) is specifically releasing all claims and rights under the Age Discrimination in Employment Act, as amended, 29 U.S.C. Section 621  et seq .; (iii) will receive compensation under this Agreement to which Executive would not have been entitled without signing this Agreement; (iv) has been advised by the Company to consult with an attorney before signing this Agreement; and (v) will be given up to twenty one (21) calendar days to consider whether to sign this Agreement. For a period of seven days after Executive signs this Agreement, Executive may, in Executive’s sole discretion, rescind this Agreement by delivering a written notice of rescission to the Company’s General Counsel. If Executive rescinds this Agreement within seven calendar days after Executive signs the Agreement, or if Executive does not sign this Agreement within the twenty-one day consideration period, this Agreement shall be void, all actions taken pursuant to this Agreement shall be reversed, and neither this Agreement nor the fact of or circumstances surrounding its execution shall be admissible for any purpose whatsoever in any proceeding between the Parties, except in connection with a claim or defense involving the validity or effective rescission of this Agreement. If Executive does not rescind this Agreement within seven calendar days after the day Executive signs this Agreement, this Agreement shall become final and binding and shall be irrevocable.
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     Executive acknowledges that Executive has received all compensation to which Executive is entitled for Executive’s work up to Executive’s last day of employment with the Company, and that Executive is not entitled to any further pay or benefit of any kind, for services rendered or any other reason, other than the payments and benefits, to the extent not already paid, described in the CIC Agreement.
     Executive agrees that the only thing of value that Executive will receive by signing this Supplemental Release is the payments and benefits described in the CIC Agreement.
     The Parties agree that their respective rights and obligations under the CIC Agreement shall survive the execution of this Release.
NOTE: DO NOT SIGN THIS LEGAL RELEASE UNTIL AFTER EXECUTIVE’S FINAL DAY OF EMPLOYMENT.
	
					
	EXECUTIVE
	 
	ADVANCED ENERGY INDUSTRIES, INC.

	 
	 
	 
	 
	 

	By:
	 
	 
	By:
	 

	 
	 
	 
	 
	 

	Date:
	 
	 
	Date:
	 

	 
	 
	 
	 
	 

A-viistaf-ex1071_82.htm

Exhibit 10.71

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (this "Agreement") is entered into on January 27, 2017, and is effective for all purposes as of the Effective Date (as  defined  below),  by  and  between Staffing 360 Solutions, Inc., a Delaware corporation (the "Company"),  and  Christopher J. Lutzo (the "Executive") .

 

RECITALS:

 

WHEREAS, the Executive has heretofore been appointed as the General Counsel (level of Executive Vice President) of the Company; and

 

WHEREAS, the Company and the Executive now desire to enter into this Agreement to memorialize the terms and conditions under which the Executive shall hereinafter serve as the General Counsel of the Company.

 

NOW, THEREFORE, in consideration of the foregoing and of the respective mutual covenants and agreements set forth below, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows:

 

1.Certain Definitions. The following capitalized terms shall have the following meanings. All other capitalized terms used herein shall have the meanings set forth in this Agreement.

 

 

(a)"Board" means the Company's Board of Directors or any designated committee thereof.

 

(b)"Cause": For purposes of this Agreement, the Company shall have "Cause" to terminate the Executive's employment hereunder for any of the following actions: (i) the Executive causing material harm to the Company through (A) a material breach by the Executive of the terms and provisions of this Agreement (including, without limitation, Section 4 hereof) or (B) the commission by Executive of an act or acts of gross negligence, dishonesty, fraud or wilful malfeasance in the performance of his duties hereunder, (ii) Executive is indicted for, or convicted of, or pleads guilty or nolo contendere with respect to, theft, fraud, a crime involving moral turpitude or a felony under federal or applicable state law, or (iii) the Executive's wilful failure to perform his material duties under this Agreement (other than a failure due to Disability) after thirty (30) day written notice specifying the failure, during which period the Executive shall have the opportunity to cure such failure (it being understood that if his failure to perform is not of a type requiring a single action to cure fully, that he may commence the cure promptly after such written notice and thereafter diligently prosecute such cure to completion) .

 

(c)"Common Stock" means the shares of common stock, par value $0.00001 per share, of the Company.

 

(d)"Contract Year" shall be a calendar year.

 

(e)"Disability" shall mean the absence of the Executive from the Executive's duties to the Company for a total of 30 consecutive days, or 60 days during any one six month period as a result of incapacity due to mental or physical illness which is determined to be total and permanent by a physician selected by the Company and acceptable to the Executive or the Executive's legal representative (such agreement as to acceptability not to be withheld unreasonably).

 

(f)"Effective Date" means February 13, 2017.

 

Exhibit 10.71

 

(g)"Good Reason": The Executive shall have Good Reason to resign from employment upon the occurrence of any of the following events:

(i)any material adverse change in the Executive's job titles, duties, responsibilities, perquisites granted hereunder, or authority without his  consent,  including  no  longer reporting directly to the Chairman (whether Executive or Non-Executive) or the Chief Executive Officer  of the  Company;

(ii)if the principal duties of the Executive are required to be performed at a location other than New York, New York without his consent; or

(iii)a material breach of this Agreement by the Company, including without limitation, the failure to  pay compensation  or benefits when  due  hereunder.

The Executive must provide to the Company written notice of his resignation within ten (10) days following the occurrence of the event or events constituting Good Reason and the Company shall have a period of thirty (30) days following its receipt of such notice (the "Cure Period") in which to cure such event or events. If the Company does  not  cure  the  event  or  events  constituting the basis for Good Reason by the end of the Cure Period, the Executive may resign  from employment within  seven  (7)  days  immediately  following  the  last day of the Cure Period. A resignation or other voluntary termination of employment by the Executive  that  does  not  comply with the requirements of this Section l(g) shall not  constitute  termination  for  Good  Reason.

(h)"Section 409A" shall mean, collectively, Section 409A of the Internal Revenue Code of 1986, as amended, and the Department of Treasury Regulations and other interpretive guidance promulgated thereunder, including without limitation any such regulations or other guidance that may be issued after the date of this Agreement.

2.Employment.

(a)The Company shall continue to employ the Executive  and  the Executive shall remain employed by the Company during the Contract Term (as defined below) in  the  positions set forth in Section 3 and upon the other terms  and  conditions  herein  provided  unless  the Executive's  employment  is terminated  earlier as provided  in Section 7  hereof.

(b)The term of this Agreement shall  begin  on  the  Effective  Date  and  shall end on the third (3) year anniversary of the Effective Date (the "Initial Term") and, after the expiration of the Initial Term, this Agreement  shall  automatically  renew  for  successive  one (1) year terms (each a "Renewal Term" and, collectively  with  all Renewal  Terms  and  the  Initial Term, the "Contract Term"), unless this Agreement  is  otherwise  terminated  pursuant  to  the terms hereof

3.Position and Duties.

(a)During the Contract Term, the Executive shall serve as:

(i)the General Counsel of the Company and shall have such duties, functions, responsibilities and authority as are consistent with the Executive's position as the senior legal officer of the Company and its properties.

(b)The Executive shall be required to spend all of his business time on the business and affairs of the Company (unless approved in writing by his immediate supervisor). 

 

 

 

Exhibit 10.71

 

4.Right of First Offer; Confidential Information; Non-Solicitation; Non- Disparagement; and Return of Company Property.

(a)Right of First Offer. Without in any manner limiting or modifying the fiduciary or similar duties of the Executive to  the  Company  under  applicable  law,  in  consideration of the benefits to inure to  the  Executive  hereunder,  the  Executive  agrees  that during the Contract Term, if the Executive or any affiliate of the Executive (each, an "Executive Affiliate") obtains or otherwise becomes aware of an opportunity to acquire and/or invest in any staffing company (the "Business Opportunity"), the Executive and/or Executive Affiliate shall present such Business Opportunity to the Company and shall not pursue any such Business Opportunity . However, during the  Post-Termination  Restricted  Period,  in  the  event  the Executive of any Executive Affiliate receives a Business Opportunity, then  Executive  will  (and  will cause each applicable Executive Affiliate to) first offer to the Company in writing  (the  "Offer") the opportunity to acquire and/or invest in the Business Opportunity prior to  directly and/or indirectly proceeding with such opportunity for the account of the Executive or  any Executive Affiliate . The Offer shall be in writing and shall describe in reasonable detail the Business Opportunity and the proposed transaction involving such Business Opportunity (including the terms of any proposed acquisition of the Business Opportunity).  The Company shall have a period of fifteen (15) days from the receipt of the Offer to elect whether it desires to accept the Offer and pursue the acquisition of the applicable Business Opportunity.  If the Company does not deliver an affirmative written decision to accept the Offer to the Executive within fifteen (15) days of the receipt of the Offer, the Executive or any Executive Affiliate shall be permitted to pursue such opportunity for their own accounts.

As used herein, the term "Restricted Period" means: (i) any time during the Contract Term and (ii) for a period of six (6) months following the termination of this Agreement and the Executive's association with the Company (the "Post-Termination Restricted Period").

(b)Confidential Information. The Executive  acknowledges  that  he  has  had and will have access to confidential information (including, but not limited to, current and prospective confidential know-how , marketing plans, business plans, financial and pricing information, and information regarding  acquisitions,  mergers  and/or joint  ventures)  concerning the business, customers, clients, contacts, prospects and  assets  of  the  Company  and  its subsidiaries (collectively, the "Staffing 360 Entities") that is unique, valuable and not generally known outside the Staffing 360 Entities,  and  which  was  obtained  from the Staffing 360 Entities  or which was learned as a result of the performance of services by the Executive on behalf of the Staffing 360 Entities ("Confidential  Information").  The Executive  agrees that  he will  not,  at any time, directly or indirectly , use, divulge, furnish or make accessible to any person any Confidential Information, but instead will keep  all  Confidential  Information  strictly  and  absolutely confidential and  use  such Confidential  Information  in  the  furtherance  of the business of the Staffing 360 Entities; provided, however, that this  provision  shall  not  prevent  the Executive from using his general business skill and knowledge in any future employment to the extent such skill and knowledge is not specifically related to the business of the Confidential Information. The Executive will deliver promptly to the Company, at the termination of his employment or at any other time at the Company's request,  without  retaining  any  copies  (other than Executive Records, as defined below), all documents and other materials in his possession relating, directly or indirectly, to any Confidential Information. For purposes of this Agreement, "Executive Records" shall mean any written or electronic records of the Executive's personal contacts.

(c)Non-Solicitation of Employees. During the Restricted Period, the Executive shall not solicit the employment or services of (whether as an employee, officer, director, agent, consultant or independent contractor), any employee, officer, director, full-time consultant or independent contractor of the Staffing 360 Entities.

 

Exhibit 10.71

 

 

(d)Non-Solicitation of Business Partners. During the Restricted Period, the Executive shall not directly or indirectly, solicit or encourage, or attempt to solicit or encourage, any customers, suppliers, licensees, agents, consultants or independent contractors or other business partners or business affiliates of the Staffing 360 Entities (collectively, "Business Partners"), to cease doing business with or modify their business relationship with the Staffing

360 Entities, or in any way intentionally interfere with  the  relationship  between  any  such Business  Partner  and the Staffing 360 Entities (regardless  of who  initiates the contact).

(e)Non-Disparagement. The Executive shall not make, and shall not cause or direct any person or entity to make, any disparaging or untrue comments or statements, whether written or oral, about any Staffing 360 Entity (or any shareholder, member, director, manager or officer thereof). No Staffing 360 Entity shall make, and shall not cause or direct any person or entity to make, any disparaging or untrue comments or statements, whether written or oral, about Executive. "Disparaging" comments or statements include such comments or statements which discredit, ridicule,  or  defame  any person  or entity  or  place  such  person  or  entity  in  a negative light or impair the reputation, goodwill  or commercial  interest  thereof.

(f)Return of Company Property/Passwords. The Executive hereby expressly covenants and agrees that following termination of the Executive's employment with the Company for any reason or at any time upon the Company's request, the Executive  will promptly return to the Company all property of the Company in his possession or control (whether maintained at his office, home or elsewhere), including, without limitation, all Company passwords, credit cards, keys, laptop computers, cell phones and all copies of all management studies, business or strategic plans, budgets, notebooks and other printed, typed or written materials, documents, diaries, calendars and data of or relating to the Staffing 360 Entities or their personnel or affairs, in whatever media maintained; provided, that, the Executive shall be permitted to retain his Executive Records.

(g)Remedies for Breach. The Executive acknowledges that a breach of this Section 4 would immediately and irreparably harm the Staffing 360 Entities  and that a remedy  at law would be inadequate to compensate the Staffing  360 Entities  for their  losses  by  reason  of such breach and therefore that the Company and/or the Staffing 360 Entities  shall,  in addition to  any other rights and remedies available under  this Agreement,  at law  or otherwise,  be entitled  to an injunction to be issued by any court of competent jurisdiction enjoining and restraining the Executive from committing any violation of this Section  4,  without  the  necessity  of  proving actual damages or posting bond, and the Executive hereby consents to the issuance of such injunction.

5.Place of Employment. During his employment hereunder, the Executive shall be based at the Company's offices located in New York, New York, currently located at 641 Lexington Avenue.

6.Compensation and Related Matters. During the Executive's employment hereunder, the Executive shall be paid the compensation and shall be provided with the benefits described below:

(a)Annual Base Salary.   The Executive's annual base compensation shall be:

(i) from the Effective Date, $2200,000 (on an annualized basis),  each payable  in accordance with the Company's prevailing payroll practices. The Annual Base Salary paid to the Executive for each Contract Year shall be increased, but shall not be decreased, on January First each year by the increase in the Consumer Price Index for All Urban Consumers (CPI-U) for the Northeast Region for all items over the prior year of the Term, as determined by the United States Department of Labor Bureau of Labor Statistics or an amount determined by the Board in its discretion, whichever is greater.

 

Exhibit 10.71

 

 

(b)Bonus.  The Executive shall also be eligible to receive a cash bonus for each year, in accordance with Schedule A.

 

(c)Equity Compensation. The Executive shall also be eligible to receive shares of restricted stock and stock options in accordance with Schedule B.

 

(d)Benefits. The Company shall continue in force full family medical coverage and comprehensive major medical and hospitalization coverage, including dental and vision coverage, for Executive and his dependents, with terms reasonably satisfactory to Executive, which policy the Company shall keep in effect at its sole cost through the Term and any extension of renewal. Executive shall be entitled to participate in or receive all other  benefits under any employee benefit plan or other arrangement made available by the Company to any of its employees (including, without limitation, the Company's 401(k) and similar plans as may be approved by the Board, collectively, the "Benefits"), on terms at least as favorable as those on which other senior executives of the Company shall participate; provided, however, that the Executive shall be entitled to 25 days of paid vacation during each Contract Year, exclusive of Company holidays.

 

(e)Expenses. The Company shall reimburse the Executive for all reasonable travel and other business expenses incurred by the Executive in the performance of his duties to the Company hereunder. Such expenses shall be reimbursable in accordance with prevailing policies of the Company upon submission of verifiable receipts. Travel to and from the Place of Employment is not deemed to be a business expense.

 

7.Termination. The Executive's employment hereunder may be terminated prior to the end of the Contract Term by the Company or the Executive, as applicable, without any breach of this Agreement only under the following circumstances:

 

(a)Death. This Agreement and the Executive's employment hereunder shall terminate upon the Executive's death.

 

(b)Disability. If the Disability of the Executive has occurred during the Contract Term, the Company may give the Executive written notice of its intention to terminate the Executive's employment. In such event, the Executive's employment with the Company (including the rights to receive compensation and benefits, except as otherwise required by law) shall terminate effective on the 30th day after receipt of such notice by the Executive, provided that within the 30 days after such receipt, the Executive shall not have returned to full-time performance of his duties.

 

(c)Cause. The Company may terminate the Executive's employment hereunder for Cause immediately upon the Company providing notice of termination to Executive (subject to any applicable cure periods).

 

(d)Without Cause. The Company may terminate the Executive's employment hereunder without Cause upon 30 days’ notice.

(e)Good Reason. The Executive may resign from his employment for Good Reason (as provided in Section l (g)).

(f)Resignation without Good Reason. The Executive may resign his employment without Good Reason upon 30 days written notice to the Company.

(g) Notice of Termination. Any termination of the Executive's employment hereunder by the Company or the Executive (other than by reason of the Executive's death) shall be communicated by a notice of termination to the other party hereto. For purposes of this Agreement, a "notice of termination" shall mean a written notice which (i) indicates the specific termination 

 

Exhibit 10.71

 

provision in the Agreement relied upon, (ii) sets forth in reasonable detail any facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision indicated and (iii) specifies the effective date of the termination.

8.Severance Benefits.

(a)Termination without Cause or for Good Reason. Subject to Section 18, if prior to the expiration of the Contract Term the Executive's employment is terminated: (i) by the Company other than for Cause, death or Disability, or (ii) by the Executive for Good Reason (as defined above), the Executive shall be entitled to receive a lump sum cash payment specified herein (the "Severance Payment"), provided that (A) the Executive has executed and delivered to the   Company (no  later  than  the thirtieth (30th) day  following the date on which his employment terminated), and has not revoked, a general release of the Company and its affiliates in a form reasonably satisfactory to the Company and (B) the Executive is in compliance with the requirements of Section 4.  The Severance Payment shall be paid,    less applicable taxes, on the thirtieth (30th) day following the date on which the Executive's employment terminated   (or such later date as may be required by Section 18). The Severance Payment shall be equal to the amount of Executive's Annual Base Salary that would have been due through the end of the Initial Term or Renewal Term (as the case may be), less applicable taxes. In addition, subject to Section 18, the Company shall continue to provide all Benefits to the Executive under this Agreement for each Contract Year through the end of the Initial Term or Renewal Term (as the case may be).

(b)Termination by Death or Disability. Subject to Section 18, upon the termination of the Executive's employment by reason of  his  death  or  Disability, the  Company shall pay to the Executive or his estate within thirty (30) days after the termination, a lump-sum amount equal to the amount of Annual Base Salary that would have been  due through  the end  of the then applicable Contract Year, less applicable taxes, and any vested and earned but unpaid  awards under the Company’s stock incentive plans and other stock or incentive awards. This  Section  8(b)  shall  not  limit  the  entitlement  of  the  Executive, his estate or beneficiaries to any disability or other Benefits then available to the Executive under any life, disability insurance or other benefit  plan or policy which is maintained  by the Company for the Executive 's  benefit.

(c)Termination for Cause or Without Good Reason. If the Executive's employment is terminated by the Company for Cause or by the Executive without Good Reason, the Executive shall be entitled to all Annual Base Salary and all Benefits accrued through the date of termination (less applicable taxes) and any vested and earned but unpaid awards under the Company's stock incentive plans and other stock or incentive awards. Such accrued compensation shall be paid in accordance with the Company's ordinary payment practices and, in any event, on or prior to the fifteenth (15th) day of the third (3rd) calendar month following the end of the calendar year in which the date of termination occurs.

 

(d)Survival. Neither the termination of the Executive's employment hereunder nor the expiration of the Contract Term shall impair the rights or obligations of any party hereto which shall have accrued hereunder prior to such termination or expiration. The obligations of Section 4 shall, to the extent provided in Section 4, survive the termination or expiration of the Executive’s employment with the Company and, as applicable, shall be fully enforceable thereafter in accordance with the terms of this Agreement.

 

 

 

 

 

 

 

 

Exhibit 10.71

 

9.Arbitration. In the event that the Company or the Executive, his  spouse or any  other person claiming benefits on behalf of or through Executive, has  a dispute  or claim  based  upon this Agreement, including the interpretation or application  of the  terms  and provisions  of  this Agreement, the sole and exclusive remedy is for that party to submit the dispute to binding arbitration in accordance with the rules of arbitration of the American Arbitration Association ("AAA") in New York, New York. Any arbitrator selected to arbitrate any such dispute shall be independent and neutral and will have the power to interpret this Agreement.  Any  determination  or decision by the arbitrator shall  be  binding  upon  the  parties  and may  be enforced  in any court of law. The expenses of the arbitrator will be paid  50% by the Company  and 50% by Executive,  his spouse or other person, as the case may be, provided that the arbitrator shall  be  free  to apportion such fees between the parties as he/she may  determine  in  his/her  discretion  as  permitted by the AAA rules of arbitration.  The parties  agree that  this  arbitration  provision  does not apply to the right of the Executive to file a charge,  testify,  assist  or participate  in any manner  in an investigation, hearing or  proceeding  before  the  Equal  Employment  Opportunity Commission or any other agency pertaining to any matters covered by this Agreement and within  the jurisdiction  of the agency.

 

10.Binding on Successors. This Agreement shall be binding upon and inure to the benefit of the Company, the Executive and their  respective  successors,  assigns,  personal  and  legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable.

 

11.Governing Law. This Agreement shall be governed, construed, interpreted and enforced in accordance with the substantive laws of the State of New York, without reference to principles of conflicts or choice of law under which the law of any other jurisdiction would apply, provided, however, the laws regarding shareholder approval of the Company's 2014 Equity Incentive Plan (the "Plan") shall be governed in accordance with the laws of the State of Nevada.

 

12.Validity. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or  enforceability  of  any  other  provision  of  this Agreement,  which  shall remain  in full force and effect.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.71

 

13. Notices. Any notice, request, claim, demand, document and other communication hereunder to any party shall be effective upon receipt (or refusal of  receipt)  and  shall  be  in writing and delivered personally or sent by facsimile transmission or certified or registered mail, postage  prepaid,  as follows:

 

If to the Company, to:

 

Staffing 360 Solutions, Inc.

641 Lexington Avenue

27th Floor

New York 10022

Tel: (646) 507-5715

 

Attention: Brendan Flood

 

with a copy (which shall not constitute notice) to: 

 

N/A

 

If to the Executive, to:

 

Christopher Lutzo

[ REDACTED ]

 

 

 

or at any other address as any party shall have specified by notice in writing to the other parties. 

 

 

14.Severability. In the event that any paragraph or provision of this Agreement shall be held to be illegal or unenforceable, the entire Agreement shall not fail on account thereof. It is further agreed that if any one or more of such paragraphs or provisions  shall  be judged to be void as going beyond what is reasonable in all of the circumstances for the  protection  of  the interests of the Company, but would be valid if part of the wording thereof were deleted  or the  period  thereof  reduced or the range of  activities covered  thereby reduced in scope, the  said reduction shall be deemed to apply with such modifications as may be necessary to  make them  valid and effective and any such modification shall not thereby affect the validity of any other paragraph  or provisions  contained  in this Agreement. 

 

15.Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement. Such counterparts may be delivered by fax or e-mail/.pdf transmission, such shall not impair the validity thereof

 

16.Entire Agreement. The terms of this Agreement are intended by the parties to be the final expression of their agreement with respect to the employment of the Executive by the Company and may not be contradicted by evidence of any prior or contemporaneous agreement. The parties further intend that this Agreement shall  constitute  the  complete  and  exclusive statement of its terms and that no extrinsic evidence whatsoever may  be  introduced  in  any  judicial, administrative, or other legal proceeding to vary the terms of this Agreement. This Agreement terminates and supersedes any and all prior agreements and understandings (whether written or oral) between the parties with respect to the subject matter of this Agreement.

 

17.Amendments; Waivers. This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by the Executive and a disinterested officer or 

 

Exhibit 10.71

 

director of the Company. By an instrument in writing similarly executed, the Executive or the Company may waive compliance by the other party or parties with any  provision  of  this Agreement that such other party was or is obligated to comply with  or  perform ; provided,  however,  that  such waiver  shall not operate as a waiver  of, or estoppel with respect to, any other  or subsequent failure. No failure to exercise and no delay in  exercising  any  right,  remedy,  or power hereunder preclude any other or further exercise of any other right, remedy, or power provided  herein  or by law or in equity.

 

18.Section 409A. The parties acknowledge and agree that, to the extent applicable, this Agreement shall be interpreted in accordance with, and the parties agree to use their best efforts to achieve timely compliance with, Section 409A. Notwithstanding any provision of this Agreement to the contrary, in the event that the Company determines that any compensation or benefits payable or provided under this Agreement (including the Severance Payment) may be subject to Section 409A, the Company may adopt (without any obligation to do so or to indemnify the Executive for failure to do so) such limited amendments to this Agreement and appropriate policies and procedures, including amendments and policies with retroactive effect, that the Company reasonably determines are necessary or appropriate to: (i) exempt the compensation and benefits payable under this Agreement from Section 409A and/or preserve the intended tax treatment of the compensation and benefits provided with respect to this Agreement or (ii) comply with the requirements of Section 409A; provided , however, that before the Company adopts any such amendment to this Agreement or policy (excluding for this purpose a policy that applies generally to plans or arrangements in addition to this Agreement), the Company will provide notice to the Executive reasonably in advance of adopting the amendment or policy of the need and appropriateness of such amendment or policy . No provision of this Agreement shall be interpreted or construed to transfer any liability for failure to comply with the requirements of Section 409A from the Executive or any other individual to the Company or any of the Company's affiliates, employees or agents.

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first above written.

 

 

EXECUTIVE

 

 

 

 

/s/ Christopher J. Lutzo___________

Christopher J. Lutzo

 

 

COMPANY

 

STAFFING 360 SOLUTIONS, INC.

 

 

 

 

By: _/s/ Brendan Flood____________

Name: Brendan Flood

Title:Executive Chairman

 

 

 

Exhibit 10.71

 

 

Schedule A

 

The Company agrees to pay the Executive an annual bonus (the "Bonus") up to fifty percent (50%) of Executive's Annual Base Salary. The Bonus shall be calculated as based on criteria to be agreed by the Board within 30 days of the effective date. The bonus will be calculated on a calendar year basis, pro-rated in the first year, and paid within 90 days of the end of the calendar year.  The bonus criteria can be amended by the Board of Directors at its discretion. The first three months bonus post start date will be guaranteed ($27,500) and will be payable in the first month after the end of the first quarter employment.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.71

 

 

 

 

Schedule B

 

(a)The Executive shall be granted an aggregate of 50,000 restricted shares of Common Stock (the "Restricted Shares") on the Effective Start Date, which shall vest as follows:

 

(i)25,000 Restricted Shares on shall vest on the one (1) year anniversary of the Effective Start Date; and

 

(ii)25,000 Restricted Shares on the two (2) year anniversary of the Effective Start Date.

 

Upon termination of employment, except in the case of 'Cause' or 'Resignation Without Good Reason', as outlined in Section 7 above, all of the Restricted Shares will fully vest to the benefit of the Executive or his dependents, as applicable.

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