Document:

exhibit_10-9.htm

Exhibit 10.9

 

Date: ____________

 

To: _____________

 

WARRANT

 

To purchase Ordinary Shares of:

Check-Cap Ltd.

 

VOID AFTER 24:00 p.m. (prevailing Israel Standard Time)

 

On the last day of the Warrant Period (as defined below)

 

WHEREAS, on or about May 11, 2010 Check-Cap Ltd. (the "Company") has granted Mr. Guy Neev options to purchase up to 1,995,475 Ordinary Shares par value NIS 0.01 each (the "Neev Options"); and

 

WHEREAS, the Company wish to issue to certain of its shareholders, for no additional consideration, simultaneously with the issuance of the Neev Options, such number of options to purchase Ordinary Shares of the Company, in order to procure that the percentage holdings of each such holder immediately prior to the issuance of the Neev Options would remain unchanged;

 

THEREFORE, THIS IS TO CERTIFY THAT, __________ (the "Holder"), is entitled to purchase from the Company, an aggregate of up to ________ Ordinary Shares of the Company, nominal value NIS 0.01 per share (the "Warrant Shares"), for no consideration, during the Warrant Period.

 

	
1.

	
EXERCISE OF WARRANT

 

	
1.1.

	
Warrant Period. This Warrant may be exercised, subject to the terms and conditions hereof, during the period commencing on the Neev Exercise Date (as defined below) and terminated upon the later of (i) the lapse of 10 years from the date hereof (i.e. May 11, 2020), or (ii) the lapse of 3 months following the expiry of the Neev Options without being exercised, provided that the Company provides the Holder a written notice at least fourteen (14) days prior to such date. The above period shall be referred to hereinafter as the "Warrant Period".

 

	
1.2.

	
Company Notice. Upon the receipt by the Company of an exercise notice by Mr. Guy Neev, according to which Mr. Guy Neev wishes to exercise the Neev Options, in whole or in part, the Company shall provide the Holder with a written notice, with the following details (the "Company Notice"):

 

	
  

	
1.2.1.

	
The anticipated date of exercise of the Neev Options ("Neev Exercise Date"), provided that the Neev Exercise Date shall occur not earlier than fourteen (14) days following the date of the Company Notice;

 

  

  

  

 

	
  

	
1.2.2.

	
The number of Neev Options exercised by Mr. Guy Neev;

 

	
  

	
1.2.3.

	
The number of Warrant Shares exercisable by the Holder, according to section ‎1.3 below.

 

	
1.3.

	
Partial Exercise. The number of Warrant Shares exercisable under this Warrant shall correspond to the portion of Neev Options actually exercised by Mr. Guy Neev, and shall be calculated as follows:

 

	
 

	
Y= (X / 1,995,475)*Z

 

Where:

 

Y- number of Warrant Shares exercisable by the Holder;

 

X- number of Neev Options exercised by Mr. Guy Neev;

 

Z- total number of Warrant Shares underlying this Warrant.

 

	
1.4.

	
Automatic Exercise. Provided that the Company provided the Company Notice, as detailed in Section ‎1.2, this Warrant will be deemed to have been automatically exercised by the Holder on the Neev Exercise Date, into such number of Warrant Shares as detailed in the Company Notice, unless the Holder has ordered the Company otherwise in writing, at least seven (7) days prior to the Neev Exercise Date.

 

	
1.5.

	
Non- Automatic Exercise. To the extent not automatically exercised on the Neev Exercise Date in accordance with Section ‎1.4 above, this Warrant may be exercised into such number of Warrant Shares as detailed in the Company Notice, by presentation and surrender thereof to the Company, on or prior to the last date of the Warrant Period, at its principal office or at such other office or agency as it may designate from time to time, accompanied by a duly executed notice of exercise, in the form attached hereto as Schedule 1.2.1 (the "Exercise Notice").

 

	
1.6.

	
Issuance of Warrant Shares. Upon the earlier of (i) automatic exercise, as detailed in Section ‎1.4, or (ii) presentation and surrender of this Warrant, accompanied by the duly executed Exercise Notice, the Company shall promptly (a) issue to the Holder the Warrant Shares to which the Holder is entitled; and (b) deliver to the Holder the share certificate evidencing such Warrant Shares.

 

Upon automatic exercise, as detailed in Section ‎1.4, or, in case the Warrant was not automatically exercised, upon receipt by the Company of this Warrant and the applicable duly executed notice of exercise, together with any other documents and/or approvals that may be required by law, the Holder shall be deemed to be the holder of record of the Warrant Shares issuable upon such exercise, notwithstanding that the share transfer books of the Company shall then be closed or that certificates representing such shares shall not then be actually delivered to the Holder.

 

In the event that all Warrant Shares are automatically exercised, this Warrant shall become null and void upon the exercise thereof.

 

In the event that a portion of the Warrant Shares remains unexercised, the Company shall execute and deliver to the Holder a new Warrant, in lieu of this Warrant, representing the remaining unexercised Warrant Shares, and upon the delivery of such new Warrant to the Holder, this Warrant shall become null and void.

 

  

2

  

 

	
1.7.

	
Fractional Shares. No fractions of Shares shall be issued in connection with the exercise of this Warrant, and the number of shares issued shall be rounded up to the nearest whole number.

 

	
1.8.

	
Additional Documents. The Holder will sign and deliver any and all documents or approvals required by law, to facilitate the issuance of shares upon exercise of this Warrant.

 

	
1.9.

	
Loss or Destruction of Warrant. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant, and (in the case of loss, theft or destruction) of reasonably expenses reimbursement and satisfactory indemnification, and upon surrender and cancellation of this Warrant, if mutilated, the Company will execute and deliver a new Warrant of like tenor and date.

 

	
2.

	
TAXES

 

	
2.1.

	
The Holder acknowledges that the grant of the Warrant, the issue of the Warrant Shares and the execution and/or performance of this Warrant may have tax consequences to the Holder and that the Company is not able to ensure or represent to the Holder the nature and extent of such tax consequences.

 

	
2.2.

	
The Holder shall be responsible and shall pay any and all taxes due in connection with the holding, issuance, exercise or sale of this Warrant or the Warrant Shares by the Holder.

 

	
3.

	
ADJUSTMENT

 

	
3.1.

	
The number of Warrant Shares purchasable upon the exercise of this Warrant shall be subject to adjustment from time to time or upon exercise, as follows:

 

	
  

	
3.1.1.

	
Consolidation and Division. In the event that during the Warrant Period the Company consolidates its share capital into shares of greater par value, or subdivides them into shares of lesser par value, then the number of Warrant Shares to be allotted on exercise of this Warrant after such consolidation or subdivision shall be reduced or increased accordingly, as the case may be.

 

	
  

	
3.1.2.

	
Capital Reorganization. In the event that during the Warrant Period a reorganization of the share capital of the Company is effected (other than subdivision, combination or reclassification provided for elsewhere in this Section ‎3) and the Ordinary Shares of the Company are exchanged for other securities of the Company, then, as part of such reorganization, provision shall be made so that the Holder shall be entitled to purchase upon exercise of this Warrant such kind and number of shares or other securities of the Company to which the Holder would have been entitled had this Warrant been exercised without taking into effect such reorganization.

 

  

3

  

 

	
3.2.

	
Whenever an adjustment is effected hereunder, the Company shall promptly compute such adjustment and deliver to the Holder a certificate setting forth the number of Warrant Shares (or any other securities) for which this Warrant is exercisable, a brief statement of the facts requiring such adjustment and the computation thereof and when such adjustment has or will become effective.

 

	
4.

	
RIGHTS OF THE HOLDER

 

	
4.1.

	
This Warrant shall not entitle the Holder, by virtue hereof, to any voting rights or other rights as a shareholder of the Company, except for the rights expressly set forth herein.

 

	
4.2.

	
The Holder acknowledges that the Warrant Shares shall be subject to such certain rights, privileges, restrictions and limitations as set forth in this Warrant, and the organizational documents of the Company (or any other agreement with respect thereto), as may be amended from time to time, and that, as a result, inter alia, of such limitations, it may be difficult or impossible for the Holder to realize his investment and/or to sell or otherwise transfer the Warrant Shares. The Holder further acknowledges that the Company's shares are not publicly traded.

 

	
5.

	
TERMINATION

 

	 	
Notwithstanding anything to the contrary, this Warrant and all the rights conferred hereby shall terminate and expire at the aforementioned time on the last day of the Warrant Period, unless the Warrant was previously exercised.

	
6.

	
MISCELLANEOUS

 

	
6.1.

	
Entire Agreement; Amendment. This Warrant sets forth the entire understanding of the parties with respect to the subject matter hereof and supersedes all existing agreements among them concerning such subject matter. All article and section headings herein are inserted for convenience only and shall not modify or affect the construction or interpretation of any provision of this Warrant. No modification or amendment of this Warrant will be valid unless executed in writing by the Company and the Holder.

 

	
6.2.

	
Waiver. No failure or delay on the part of any of the parties in exercising any right, power or privilege hereunder and/or under any applicable laws or the exercise of such right or power in a manner inconsistent with the provisions of this Warrant or applicable law shall operate as a waiver thereof. Any waiver must be evidenced in writing signed by the party against whom the waiver is sought to be enforced.

 

	
6.3.

	
Successors and Assigns; Assignment. Except as otherwise expressly limited herein, this Warrant shall inure to the benefit of, be binding upon, and be enforceable by the Holder and its respective successors and administrators and is otherwise non-transferable without the prior consent of the Company. The Holder represents and warrants to the Company that this Warrant and the Warrant Shares, if and when purchased by the Holder, are for the Holder's own account and for investment purposes only and not with a view for resale or transfer and that all the rights pertaining to the Warrant or the Warrant Shares, by law or equity, shall be purchased and possessed by the Holder for the Holder exclusively.

 

	
6.4.

	
Governing Law.  This Warrant shall be exclusively governed and construed in accordance with the laws of the State of Israel, without regard to conflicts of laws provisions thereof.

 

  

4

  

 

	
6.5.

	
Arbitration.  Any dispute, controversy or claim arising in relation to this Warrant, including with regard to its validity, invalidity, breach, enforcement or termination, will be referred to a single arbitrator, who shall be appointed by the Head of the Israeli Bar Association.  Arbitration proceedings shall take place in Tel Aviv, Israel, and shall be conducted in English and according to the rules of substantive law. The arbitrator will not be bound by rules of evidence or procedure and will give the reasons for his judgment. The arbitrator's decision shall be final and enforceable in any court. This paragraph shall constitute an arbitration agreement between the parties.

 

	
6.6.

	
Notices.  Any notice required or permitted to be given to a party pursuant to the provisions of this Warrant will be in writing and will be effective and deemed delivered to such party on the earliest of the following: (a) all notices and other communications delivered in person or by courier service shall be deemed to have been delivered as of actual delivery thereof; (b) those given by facsimile transmission shall be deemed delivered on the following business day after transmission, with confirmed transmission thereof; and/or (c) all notices and other communications sent by registered mail (or air mail if the posting is international) shall be deemed given three (3) days after posting.

 

	
6.7.

	
Severability.  If any provision of this Warrant is held to be unenforceable, this Warrant shall be considered divisible and such provision shall be deemed inoperative to the extent it is deemed unenforceable, and in all other respects this Warrant shall remain in full force and effect; provided, however, that if any such provision may be made enforceable by limitation thereof, then such provision shall be deemed to be so limited and shall be enforceable to the maximum extent permitted by applicable law.

 

	
6.8.

	
Counterparts.  This Warrant may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.  Facsimile signatures of a party shall be binding as evidence of such party's agreement hereto and acceptance hereof.

 

IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized.

 

	
Dated:  _________________

 

	
Check-Cap Ltd.

 

By: ______________________________

 

       Name:

 

       Title:

 

  

5

  

 

AGREED AND ACCEPTED:

 

__________________________

 

_________________

 

  

6

  

 

Schedule 1.2.1

 

Exercise Notice

 

Date: ____________

 

To:         Check-Cap Ltd.

 

The undersigned, pursuant to the provisions set forth in the Warrant to which this Exercise Notice is attached (the "Warrant"), hereby elects to purchase the Warrant Shares (as such term is defined in the Warrant) pursuant to Section ‎1.5 of the Warrant.

 

	 	
Signature:                                                        

 

Address: ________________

                 ________________

 

  

7

  

 

Date: ____________________

 

To: ___________________

 

WARRANT

 

To purchase Ordinary Shares of:

Check-Cap Ltd.

 

VOID AFTER 24:00 p.m. (prevailing Israel Standard Time)

 

On the last day of the Warrant Period (as defined below)

 

WHEREAS, on or about May 11, 2010 Check-Cap Ltd. (the "Company") has granted Mr. Guy Neev options to purchase up to 1,995,475 Ordinary Shares par value NIS 0.01 each (the "Neev Options"); and

WHEREAS, the Company wish to issue to certain of its shareholders, for no additional consideration, simultaneously with the issuance of the Neev Options, such number of options to purchase Ordinary Shares of the Company, in order to procure that the percentage holdings of each such holder immediately prior to the issuance of the Neev Options would remain unchanged;

THEREFORE, THIS IS TO CERTIFY THAT, _____________ (the "Holder"), is entitled to purchase from the Company, an aggregate of up to _____________ Ordinary Shares of the Company, nominal value NIS 0.01 per share (the "Warrant Shares"), for no consideration, during the Warrant Period.

	
1.

	
EXERCISE OF WARRANT

 

	
1.1.

	
Warrant Period. This Warrant may be exercised, subject to the terms and conditions hereof, during the period commencing on the Neev Exercise Date (as defined below) and terminated upon the later of (i) the lapse of 10 years from the date hereof (i.e. May 11, 2020), or (ii) the lapse of 3 months following the expiry of the Neev Options without being exercised, provided that the Company provides the Holder a written notice at least fourteen (14) days prior to such date. The above period shall be referred to hereinafter as the "Warrant Period".

 

	
1.2.

	
Company Notice. Upon the receipt by the Company of an exercise notice by Mr. Guy Neev, according to which Mr. Guy Neev wishes to exercise the Neev Options, in whole or in part, the Company shall provide the Holder with a written notice, with the following details (the "Company Notice"):

 

	
  

	
1.2.1.

	
The anticipated date of exercise of the Neev Options ("Neev Exercise Date"), provided that the Neev Exercise Date shall occur not earlier than fourteen (14) days following the date of the Company Notice;

 

	
  

	
1.2.2.

	
The percentage of Neev Options exercised by Mr. Guy Neev;

 

	
  

	
1.2.3.

	
The number of Warrant Shares exercisable by the Holder, according to section ‎1.3 below.

 

  

1

  

 

	
1.3.

	
Partial Exercise. The number of Warrant Shares exercisable under this Warrant shall correspond to (a) the portion of Neev Options actually exercised by Mr. Guy Neev and (b) the number of warrants exercised by the Holder prior to the exercise of this Warrant, and shall be calculated as follows:

 

	 	
Y= [X *Z*(A/B)]-P

 

Where:

 

Y- number of Warrant Shares exercisable by the Holder under this Warrant;

 

X- the aggregate percentage of Neev Options actually exercised by Mr. Guy Neev as of the specific date of exercise of this Warrant;

 

Z- total maximum number of Warrant Shares underlying this Warrant.

        

	
 

	
 B- Warrants to purchase up to __________ C-1 Preferred Shares of the Company and __________ C-2 Preferred Shares of the Company, which constitute the aggregate number 

of  warrants granted to the Holder by the Company on or prior to the date hereof (other than this Warrant) (the "Exisiting Warrants").

 

	
 

	

A- The number of warrant shares that were issued upon exercise (or any partial exercise) by the Holder of the Exisiting Warrants (as defined above) on or prior to the date of 

exercise (or any partial exercise) of this Warrant.

 

	
 

	

P – The aggregate number of Warrant Shares, out of this Warrant, that have been previously issued to the Holder prior to any specific exercise of this Warrant.

 

	
1.4.

	
Automatic Exercise. Provided that the Company provided the Company Notice, as detailed in Section ‎1.2, this Warrant will be deemed to have been automatically exercised by the Holder on the Neev Exercise Date, into such number of Warrant Shares as detailed in the Company Notice, unless the Holder has ordered the Company otherwise in writing, at least seven (7) days prior to the Neev Exercise Date.

 

	
1.5.

	
Non- Automatic Exercise. To the extent not automatically exercised on the Neev Exercise Date in accordance with Section ‎1.4 above, this Warrant may be exercised into such number of Warrant Shares as detailed in the Company Notice, by presentation and surrender thereof to the Company, on or prior to the last date of the Warrant Period, at its principal office or at such other office or agency as it may designate from time to time, accompanied by a duly executed notice of exercise, in the form attached hereto as Schedule 1.2.1 (the "Exercise Notice").

 

  

2

  

 

	
1.6.

	
Issuance of Warrant Shares. Upon the earlier of (i) automatic exercise, as detailed in Section ‎1.4, or (ii) presentation and surrender of this Warrant, accompanied by the duly executed Exercise Notice, the Company shall promptly (a) issue to the Holder the Warrant Shares to which the Holder is entitled; and (b) deliver to the Holder the share certificate evidencing such Warrant Shares.

 

Upon automatic exercise, as detailed in Section ‎1.4, or, in case the Warrant was not automatically exercised, upon receipt by the Company of this Warrant and the applicable duly executed notice of exercise, together with any other documents and/or approvals that may be required by law, the Holder shall be deemed to be the holder of record of the Warrant Shares issuable upon such exercise, notwithstanding that the share transfer books of the Company shall then be closed or that certificates representing such shares shall not then be actually delivered to the Holder.

 

In the event that all Warrant Shares are automatically exercised, this Warrant shall become null and void upon the exercise thereof.

 

In the event that a portion of the Warrant Shares remains unexercised, the Company shall execute and deliver to the Holder a new Warrant, in lieu of this Warrant, representing the remaining unexercised Warrant Shares, and upon the delivery of such new Warrant to the Holder, this Warrant shall become null and void.

 

	
1.7.

	
Fractional Shares. No fractions of Shares shall be issued in connection with the exercise of this Warrant, and the number of shares issued shall be rounded up to the nearest whole number.

 

	
1.8.

	
Additional Documents. The Holder will sign and deliver any and all documents or approvals required by law, to facilitate the issuance of shares upon exercise of this Warrant.

 

	
1.9.

	
Loss or Destruction of Warrant. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant, and (in the case of loss, theft or destruction) of reasonably expenses reimbursement and satisfactory indemnification, and upon surrender and cancellation of this Warrant, if mutilated, the Company will execute and deliver a new Warrant of like tenor and date.

 

	
2.

	
TAXES

 

	
2.1.

	
The Holder acknowledges that the grant of the Warrant, the issue of the Warrant Shares and the execution and/or performance of this Warrant may have tax consequences to the Holder and that the Company is not able to ensure or represent to the Holder the nature and extent of such tax consequences.

 

	
2.2.

	
The Holder shall be responsible and shall pay any and all taxes due in connection with the holding, issuance, exercise or sale of this Warrant or the Warrant Shares by the Holder.

 

  

3

  

 

	
3.

	
ADJUSTMENT

 

	
3.1.

	
The number of Warrant Shares purchasable upon the exercise of this Warrant shall be subject to adjustment from time to time or upon exercise, as follows:

 

	
  

	
3.1.1.

	
Consolidation and Division. In the event that during the Warrant Period the Company consolidates its share capital into shares of greater par value, or subdivides them into shares of lesser par value, then the number of Warrant Shares to be allotted on exercise of this Warrant after such consolidation or subdivision shall be reduced or increased accordingly, as the case may be.

 

	
  

	
3.1.2.

	
Capital Reorganization. In the event that during the Warrant Period a reorganization of the share capital of the Company is effected (other than subdivision, combination or reclassification provided for elsewhere in this Section ‎3) and the Ordinary Shares of the Company are exchanged for other securities of the Company, then, as part of such reorganization, provision shall be made so that the Holder shall be entitled to purchase upon exercise of this Warrant such kind and number of shares or other securities of the Company to which the Holder would have been entitled had this Warrant been exercised without taking into effect such reorganization.

 

	
3.2.

	
Whenever an adjustment is effected hereunder, the Company shall promptly compute such adjustment and deliver to the Holder a certificate setting forth the number of Warrant Shares (or any other securities) for which this Warrant is exercisable, a brief statement of the facts requiring such adjustment and the computation thereof and when such adjustment has or will become effective.

 

	
4.

	
RIGHTS OF THE HOLDER

 

	
4.1.

	
This Warrant shall not entitle the Holder, by virtue hereof, to any voting rights or other rights as a shareholder of the Company, except for the rights expressly set forth herein.

 

	
4.2.

	
The Holder acknowledges that the Warrant Shares shall be subject to such certain rights, privileges, restrictions and limitations as set forth in this Warrant, and the organizational documents of the Company (or any other agreement with respect thereto), as may be amended from time to time, and that, as a result, inter alia, of such limitations, it may be difficult or impossible for the Holder to realize his investment and/or to sell or otherwise transfer the Warrant Shares. The Holder further acknowledges that the Company's shares are not publicly traded.

 

	
5.

	
TERMINATION

 

	 	
Notwithstanding anything to the contrary, this Warrant and all the rights conferred hereby shall terminate and expire at the aforementioned time on the last day of the Warrant Period, unless the Warrant was previously exercised.

 

  

4

  

 

	
6.

	
MISCELLANEOUS

 

	
6.1.

	
Entire Agreement; Amendment. This Warrant sets forth the entire understanding of the parties with respect to the subject matter hereof and supersedes all existing agreements among them concerning such subject matter. All article and section headings herein are inserted for convenience only and shall not modify or affect the construction or interpretation of any provision of this Warrant. No modification or amendment of this Warrant will be valid unless executed in writing by the Company and the Holder.

 

	
6.2.

	
Waiver. No failure or delay on the part of any of the parties in exercising any right, power or privilege hereunder and/or under any applicable laws or the exercise of such right or power in a manner inconsistent with the provisions of this Warrant or applicable law shall operate as a waiver thereof. Any waiver must be evidenced in writing signed by the party against whom the waiver is sought to be enforced.

 

	
6.3.

	
Successors and Assigns; Assignment. Except as otherwise expressly limited herein, this Warrant shall inure to the benefit of, be binding upon, and be enforceable by the Holder and its respective successors and administrators and is otherwise non-transferable without the prior consent of the Company. The Holder represents and warrants to the Company that this Warrant and the Warrant Shares, if and when purchased by the Holder, are for the Holder's own account and for investment purposes only and not with a view for resale or transfer and that all the rights pertaining to the Warrant or the Warrant Shares, by law or equity, shall be purchased and possessed by the Holder for the Holder exclusively.

 

	
6.4.

	
Governing Law.  This Warrant shall be exclusively governed and construed in accordance with the laws of the State of Israel, without regard to conflicts of laws provisions thereof.

 

	
6.5.

	
Arbitration.  Any dispute, controversy or claim arising in relation to this Warrant, including with regard to its validity, invalidity, breach, enforcement or termination, will be referred to a single arbitrator, who shall be appointed by the Head of the Israeli Bar Association.  Arbitration proceedings shall take place in Tel Aviv, Israel, and shall be conducted in English and according to the rules of substantive law. The arbitrator will not be bound by rules of evidence or procedure and will give the reasons for his judgment. The arbitrator's decision shall be final and enforceable in any court. This paragraph shall constitute an arbitration agreement between the parties.

 

	
6.6.

	
Notices.  Any notice required or permitted to be given to a party pursuant to the provisions of this Warrant will be in writing and will be effective and deemed delivered to such party on the earliest of the following: (a) all notices and other communications delivered in person or by courier service shall be deemed to have been delivered as of actual delivery thereof; (b) those given by facsimile transmission shall be deemed delivered on the following business day after transmission, with confirmed transmission thereof; and/or (c) all notices and other communications sent by registered mail (or air mail if the posting is international) shall be deemed given three (3) days after posting.

 

  

5

  

 

	
6.7.

	
Severability.  If any provision of this Warrant is held to be unenforceable, this Warrant shall be considered divisible and such provision shall be deemed inoperative to the extent it is deemed unenforceable, and in all other respects this Warrant shall remain in full force and effect; provided, however, that if any such provision may be made enforceable by limitation thereof, then such provision shall be deemed to be so limited and shall be enforceable to the maximum extent permitted by applicable law.

 

	
6.8.

	
Counterparts.  This Warrant may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.  Facsimile signatures of a party shall be binding as evidence of such party's agreement hereto and acceptance hereof.

 

  

6

  

 

IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized.

 

	
Dated:  _________________

 

	
Check-Cap Ltd.

 

By: ______________________________

       Name:

       Title:

 

AGREED AND ACCEPTED:

 

__________________________

 

Avraham Inbar

 

  

7

  

 

Schedule 1.2.1

Exercise Notice

 

Date: ____________

 

To:         Check-Cap Ltd.

 

The undersigned, pursuant to the provisions set forth in the Warrant to which this Exercise Notice is attached (the "Warrant"), hereby elects to purchase the Warrant Shares (as such term is defined in the Warrant) pursuant to Section ‎1.5 of the Warrant.

 

	 	
Signature:

 

Address: _____________

 

                 _____________

 

8intersections-ex101_123114.htm

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (the “Agreement”) is made as of this 5th day of January, 2015, by and between Intersections Inc., a Delaware corporation, with offices at 3901 Stonecroft Boulevard, Chantilly, Virginia 20151 (the “Corporation”) and Johan J. Roets, an individual, residing at 10900 Lake Windermere Road, Great Falls, VA  22066 (the “Executive”).  This Agreement shall be effective as of January 1, 2015.

 

W I T N E S S E T H:

 

WHEREAS, the Corporation desires to employ the Executive and the Executive desires to accept such employment upon the terms and conditions contained in this Agreement;

 

NOW, THEREFORE, for and in consideration of the premises and the mutual covenants and agreements herein contained, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

 

1.              Employment.  The Corporation hereby employs the Executive, and the Executive hereby accepts employment, as the Chief Operating Officer of the Corporation under the terms and conditions set forth herein, commencing September 9, 2014 (the “Commencement Date”).

 

2.              Term.  This Agreement and the Executive’s employment are for an indefinite term.  Therefore, the Executive is employed on an at-will basis and either the Executive or the Corporation may terminate his employment at any time and for any reason, with or without “cause” including, without limitation, as defined in paragraph 6.c.; provided, however, other than in the case of termination by the Corporation for “cause” as defined in paragraph 6.c. or due to the Executive’s death or disability as set forth in paragraphs 6.a. or 6.b., both the Corporation and the Executive shall give the other 30 days’ prior written notice of termination. Notwithstanding the foregoing, the Corporation may, at its option, provide a cash payment up to 30 days’ Base Salary in lieu of such 30 days’ notice or any portion thereof.

 

3.              Duties.

 

a.           While the Executive is employed pursuant to this Agreement, he shall perform such duties and discharge such responsibilities as the Chief Executive Officer of the Corporation and the Board of Directors of the Corporation  (the “Board of Directors”) shall from time to time direct, which duties and responsibilities shall be commensurate with the Executive’s position. The Executive shall perform his duties and discharge his responsibilities from the Corporation’s principal office in Chantilly, Virginia, other than normal and customary business travel, which is also a duty and requirement of the Executive’s employment with the Corporation. The Executive shall comply fully with all applicable laws, rules and regulations as well as with the Corporation’s policies and procedures. The Executive shall devote his entire working time to the business of the Corporation and shall use his best efforts, skills and abilities in his diligent and faithful performance of his duties and responsibilities hereunder. While the Executive is employed pursuant to this Agreement, he shall not engage in any other business activities or hold any office or position, regardless of whether any such activity, office or position is pursued for profit or other pecuniary advantage, without the prior written consent of the Corporation; provided, however, the Executive may engage in (i) personal investment activities for himself and his family and (ii) charitable and civic activities, so long as such outside interests set forth in subsections (i) and (ii) hereof do not interfere with the performance of his duties and responsibilities hereunder.

 

b.           The Chief Executive Officer and the Board of Directors reserve the right from time to time to assign to the Executive additional duties and responsibilities and to delegate to other employees of the Corporation duties and responsibilities normally discharged by the Executive. All such assignments and delegations of duties and responsibilities shall be made in good faith and shall not materially affect the general character of the work to be performed by the Executive. The Executive shall hold such officerships and directorships in the Corporation and any subsidiary to which, from time to time, the Executive may be appointed or elected with no additional compensation payable to the Executive.

 

4.              Compensation and Related Matters.  As full compensation for the Executive’s performance of his duties and responsibilities during his employment pursuant to this Agreement, the Corporation shall pay the Executive the compensation and provide the benefits set forth below:

 

a.           Base Salary.  The Corporation shall pay the Executive an annual salary (the “Base Salary”) of $500,000, less applicable withholding and other deductions, payable in accordance with the Corporation’s then current payroll practices.  Commencing in 2016, the Base Salary will be reviewed at least annually by the Board of Directors (and/or the Compensation Committee thereof) and may be increased, but not decreased, in its sole discretion, in which event any increased Base Salary shall be deemed the Base Salary under this Agreement.

 

b.           Bonus.  For each full calendar year of the Executive’s employment, the Executive shall be eligible to participate in a bonus plan (“Bonus Plan”) to be determined in the sole discretion of the Corporation’s Chief Executive Officer, subject to financial, tax and legal analysis, and the approval by the Board of Directors (and/or the Compensation Committee thereof).  The Executive’s participation in the Bonus Plan shall be subject to the plan terms and conditions (which may be based on such factors as the Board of Directors (and/or the Compensation Committee thereof) determine in its or their sole discretion, including the performance of the Corporation and/or the Executive) adopted by the Board of Directors (and/or the Compensation Committee thereof).  Without limiting the generality of the foregoing, to be eligible for a bonus under the Bonus Plan, the Executive must be in an “active working status” at the time of bonus payment.  For purposes of this Agreement, “active working status” shall mean that the Executive has not resigned (or given notice of his intention to resign) and has not been terminated for any reason, with or without “cause” including, without limitation, as defined in paragraph 6.c. (or been given notice of termination), except as otherwise provided in paragraph 6 hereof.

 

c.           Benefits.  The Executive shall be entitled to participate in, and receive benefits from, any health, welfare and retirement plans and programs (including, but not limited to, medical, dental, life insurance, disability and 401(k)), if any are adopted, of the Corporation and/or any employing subsidiary which may be in effect from time to time during the Executive’s employment by the Corporation and/or employing subsidiary, on the same basis as those benefits are generally made available to other senior executives of the Corporation and/or employing subsidiary, subject to the terms and conditions of such plans as may be in effect from time to time.

 

d.           Equity Awards.  The Executive shall be considered for equity or equity based awards by the Board of Directors (and/or Compensation Committee thereof) on a similar basis as generally made available to other senior officers of the Corporation (other than the Corporation’s Chief Executive Officer).  Any such grants or awards shall be made at the sole discretion of the Board of Directors and/or Compensation Committee thereof and the terms of such grants or awards, if any, shall be set forth in the applicable plans and award agreements.

 

e.           Leave.  The Executive shall be eligible to receive and take paid leave that the Corporation generally makes available to its senior officers in accordance with the Corporation’s leave policies (as may be revised from time to time).

 

f.           Car Allowance.  The Corporation shall provide the Executive with an annual car allowance (the “Car Allowance”), which shall be applied to the purchase or lease of a vehicle. The Car Allowance shall equal 4% of the Executive’s Base Salary, less applicable withholding and other deductions, and shall be divided into equal payments and paid on the same basis as the Corporation’s payroll. The Executive shall be responsible for the maintenance and operation of the vehicle and the costs associated with the same, including, without limitation, insurance.

 

g.           Insurance, Indemnification and Related Matters.  While the Executive is employed by the Corporation and for so long as there exists potential for liability thereafter with regard to the Executive’s activities during his employment on behalf of the Corporation or any of its subsidiaries or affiliates (regardless of whether as an employee, officer, or member of the Board of Directors or in any other capacity on behalf of the Corporation or any of its subsidiaries or affiliates), the Corporation shall (i) indemnify, defend and hold harmless the Executive and (ii) advance payment of costs and expenses incurred by the Executive in defense of any such action, suit or proceeding to which the Executive is made a party or is threatened to be made a party (provided the Executive shall repay such expenses in the event it is ultimately determined he is not entitled to such indemnification), in each case  on terms and conditions no less favorable than the Corporation provides at any time during the Executive’s employment or afterwards to its other executive officers and members of the Board of Directors. During the Executive’s employment and for 6 years thereafter, the Executive shall be entitled, at the Corporation’s expense, to the same directors’ and officers’ liability insurance coverage that the Corporation provides generally to its other executive officers and members of the Board of Directors, as may be amended from time to time, provided that such insurance coverage following the Executive’s employment shall be on terms and conditions no less favorable to the Executive than those in effect at the expiration or termination of his employment. The rights provided by this paragraph 4.g. shall be in addition to any other rights to which the Executive may be entitled under any of the organizational documents of the Corporation or any of its subsidiaries or affiliates, any agreement, pursuant to any vote of the holders of equity interests or securities of the Corporation or any of its subsidiaries or affiliates, as a matter of law or otherwise.

 

5.              Expenses.  The Corporation or its subsidiaries shall reimburse the Executive for expenses which the Executive may from time to time reasonably incur on behalf of and at the request of the Corporation in the performance of his responsibilities and duties under this Agreement, provided that the Executive shall be required to account to the Corporation for such expenses in the manner prescribed by the Corporation.

 

6.              Termination.  This Agreement and the Executive’s employment shall terminate:

 

a.           immediately upon the Executive’s death; or

 

b.           upon the Executive’s disability.  For purposes of this Agreement, the term “disability” shall mean that the Executive is (i) unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months or (ii) by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the service provider’s employer; or

 

c.           upon the existence of cause. For purposes of this Agreement, “cause” shall mean that the Executive: (i) has been convicted of, or entered a plea of nolo contendre to, a misdemeanor involving moral turpitude or any felony under the laws of the United States or any state or political subdivision thereof; (ii) has committed an act constituting a breach of fiduciary duty, fraud, gross negligence or willful misconduct; (iii) has engaged in conduct that violated the Corporation’s then existing internal policies or procedures and which is materially detrimental to the business, reputation, character or standing of the Corporation or any of its subsidiaries; or (iv) after written notice to the Executive and a reasonable opportunity of at least 30 days to cure, the Executive shall continue (x) to be in material breach of the terms of this Agreement; (y) to fail or refuse to attend to the material duties and responsibilities reasonably assigned to him by the Board of Directors consistent with his authority, position and responsibilities on the date hereof; or (z) to be absent excessively for reasons unrelated to disability; or

 

d.         upon the existence of good reason. For purposes of this Agreement, the following shall constitute “good reason”:  the existence of one or more of the following events has occurred without the written consent of the Executive: (i) a material reduction in the Executive’s Base Salary; (ii) the relocation of the Executive’s office to a location outside of a 30-mile radius from the Corporation’s present Chantilly, Virginia location; (iii) a material breach by the Corporation of the terms of this Agreement; or (iv) following a “change in control” as defined in paragraph 6.e. hereof, a material diminution in the Executive’s authority, duties or responsibilities; provided, however, that none of the events described herein will constitute good reason unless the Executive has first provided written notice to the Corporation of the occurrence of the applicable event(s) within 90 days of the initial existence of such event and the Corporation fails to cure such event within 30 days after its receipt of such written notice and, if uncured, the termination is effective (and the Executive terminates) as of the end of such 30 day cure period.

 

e.         for the purposes of this Agreement, the term “change in control” shall mean that:

 

(i)           any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), other than the Corporation, any existing director or officer of the Corporation, any trustee or other fiduciary holding securities under an employee benefit plan of the Corporation, or any corporation owned, directly or indirectly, by the stockholders of the Corporation in substantially the same proportions as their ownership of stock of the Corporation, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Corporation representing 30% or more of the Common Stock of the Corporation; or

 

(ii)           the stockholders of the Corporation approve a merger or consolidation of the Corporation with any other corporation, other than a merger or consolidation which would result in the voting securities of the Corporation outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the Corporation or such surviving entity outstanding immediately after such merger or consolidation; or

 

(iii)           the stockholders of the Corporation approve an agreement for the sale or disposition by the Corporation of all or substantially all of the Corporation’s assets.

 

f.           If the Executive’s employment is terminated by: (a) the Corporation pursuant to paragraph 6.c., or (b) the Executive other than pursuant to paragraph 6.d., then, in full satisfaction of the Corporation’s obligations under this Agreement, the Executive shall be entitled to receive (i) the Base Salary provided for herein up to and including the effective date of termination, prorated on a daily basis; and (ii) medical benefit continuation at the Executive’s and/or his dependents’ expense as provided by law.

 

g.           If the Executive’s employment is terminated by: (a) the Corporation pursuant to paragraph 6.a., 6.b. or other than pursuant to paragraph 6.c. or (b) the Executive pursuant to paragraph 6.d., then, in full satisfaction of the Corporation’s obligations under this Agreement, the Executive, his beneficiaries or estate, as appropriate, shall be entitled to receive: (i) the Base Salary provided for herein up to and including the effective date of termination, prorated on a daily basis; (ii) any cash bonus which would otherwise be payable to the Executive with respect to the year prior to the year of termination, to the extent scheduled to be paid in the year of termination and not previously been paid, which shall be due and payable in the year of termination and at the same time as such bonuses for such year are paid to active employees (but no later than March 15th of the year of termination); (iii) severance in an amount equal 1.5 times the Executive’s Base Salary (2.5 times the Executive’s Base Salary if the Executive’s employment is terminated upon, or within 12 months following, a change in control), in either case in exchange for a general release in form and content satisfactory to the Corporation (the “Release”), to be paid in one payment on the 60th day following the date of such termination, provided that the Release must have become effective before the 60th day following such termination; and (iv) medical benefit continuation at the Executive’s and/or his dependents’ expense as provided by law; provided, however, as additional consideration for the Release, to the extent the Executive and/or his covered dependents elect medical continuation coverage, the Corporation will pay (or reimburse) the cost of medical benefit continuation (on the same basis and at the same cost as such benefits are currently provided to senior executives of the Corporation) for the Executive and any covered dependents for up to 18 months or until the Executive and/or his covered dependents are covered by another company’s group health insurance, whichever is sooner; and provided, further, that if the Corporation determines in good faith that its payment of such cost will result in the imposition of excise taxes or penalties on the Corporation and/or the insurance carrier with respect to such medical benefits, then the Corporation shall not pay (or reimburse) such cost and the Corporation shall provide an economically equivalent benefit or payment, to the extent that such benefit or payment is consistent with applicable law and will not result in the imposition of such excise taxes or penalties.  In addition, in the event of (i) the Executive’s death or disability (as defined in paragraph 6.b.), all of the Executive’s outstanding unvested equity and equity based awards shall immediately become vested and any restrictions thereon shall lapse and, if applicable, become exercisable, and (ii) the event of the Executive’s termination of employment by the Corporation other than pursuant to paragraph 6.c. or termination of employment by the Executive pursuant to paragraph 6.d., on the Executive’s date of termination of employment, the Executive shall become vested, and all restrictions shall lapse and, if applicable, become exercisable, on the Executive’s outstanding equity and equity based awards that would have vested in the 12 months following the Executive’s date of termination of employment if the Executive had remained employed by the Corporation.

 

h.           The Executive hereby acknowledges that he is employed by the Corporation for an indefinite term and nothing in this Agreement, including, without limitation, this paragraph 6, changes the at-will nature of his employment.

 

7.              Confidential and Proprietary Information; Work Product; Warranty; Non-Competition; Non-Solicitation; Non-Disparagement, Etc.

 

a.           Confidentiality.  The Executive acknowledges and agrees that there are certain trade secrets and confidential and proprietary information (collectively, “Confidential Information”) which have been developed by the Corporation and which are used by the Corporation in its business. Confidential Information shall include, without limitation: (i) customer lists and supplier lists; (ii) the details of the Corporation’s relationships with its customers, including, without limitation, the financial relationship with a customer, knowledge of the internal “politics”/workings of a customer organization, a customer’s technical needs and job specifications, knowledge of a customer’s strategic plans and the identities of contact persons within a customer’s organization; (iii) the Corporation’s marketing and development plans, business plans; and (iv) other information proprietary to the Corporation’s business. The Executive shall not, at any time during or after his employment hereunder, use or disclose such Confidential Information, except to authorized representatives of the Corporation or the customer or as required in the performance of his duties and responsibilities hereunder. The Executive shall return all customer and/or Corporation property, such as computers, software and cell phones, and documents (and any copies including, without limitation, in machine or human-readable form), to the Corporation when his employment terminates. The Executive shall not be required to keep confidential any Confidential Information which (x) is or becomes publicly available through no fault of the Executive, (y) is already in his possession (unless obtained from the Corporation or one of its customers) or (z) is required to be disclosed by applicable law or regulation, or pursuant to the valid order of a court of competent jurisdiction or an authorized government agency, provided that the Executive shall provide the Corporation written notice of any such order prior to such disclosure to the extent practicable under the circumstances.  Further, the Executive shall be free to use and employ his general skills, know-how and expertise, and to use, disclose and employ any generalized ideas, concepts, know-how, methods, techniques or skills, including, without limitation, those gained or learned during the course of the performance of his duties and responsibilities hereunder, so long as he applies such information without disclosure or use of any Confidential Information.

 

b.           Work Product.  The Executive agrees that all copyrights, patents, trade secrets or other intellectual property rights associated with any ideas, concepts, techniques, inventions, processes, or works of authorship developed or created by him during his employment by the Corporation and for a period of 6 months thereafter, that (i) relate, whether directly or indirectly, to the Corporation’s actual or anticipated business, research or development or (ii) are suggested by or as a result of any work performed by the Executive on the Corporation’s behalf, shall, to the extent possible, be considered works made for hire within the meaning of the Copyright Act (17 U.S.C. Section 101 et seq.) (the “Work Product”). All Work Product shall be and remain the property of the Corporation. To the extent that any such Work Product may not, under applicable law, be considered works made for hire, the Executive hereby grants, transfers, assigns, conveys and relinquishes, and agrees to grant, transfer, assign, convey and relinquish from time to time, on an exclusive basis, all of his right, title and interest in and to the Work Product to the Corporation in perpetuity or for the longest period otherwise permitted by law. Consistent with his recognition of the Corporation’s absolute ownership of all Work Product, the Executive agrees that he shall (i) not use any Work Product for the benefit of any party other than the Corporation and (ii) at the Corporation’s sole expense, perform such acts and execute such documents and instruments as the Corporation may now or hereafter deem reasonably necessary or desirable to evidence the transfer of absolute ownership of all Work Product to the Corporation; provided, however, if following 10 days’ written notice from the Corporation, the Executive refuses, or is unable, due to disability, incapacity, or death, to execute such documents relating to the Work Product, he hereby appoints any of the Corporation’s officers as his attorney-in-fact to execute such documents on his behalf. This agency is coupled with an interest and is irrevocable without the Corporation’s prior written consent.

 

c.           Warranty.  The Executive represents and warrants to the Corporation that (i) there are no claims that would adversely affect his ability to assign all right, title and interest in and to the Work Product to the Corporation; (ii) the Work Product does not violate any patent, copyright or other proprietary right of any third party; (iii) the Executive has the legal right to grant the Corporation the assignment of his interest in the Work Product as set forth in this Agreement; and (iv) he has not brought and will not bring to his employment hereunder, or use in connection with such employment, any trade secret, confidential or proprietary information, or computer software, except for software that he has a right to use for the purpose for which it shall be used, in his employment hereunder.

 

d.           Non-Competition; Non Solicitation.  The Executive agrees that during his employment by the Corporation and for 18 months thereafter, regardless of the circumstances which result in his termination, he shall not within the continental United States or Canada (i) engage or attempt to engage, directly or indirectly, whether as an employee, officer, director, consultant or otherwise, in any business activity which is the same as, substantially similar to or directly competitive with the Corporation; (ii) solicit or attempt to solicit, directly or indirectly, whether as an employee, officer, director, consultant or otherwise, any person or entity which is then a customer of the Corporation or has been a customer or solicited by the Corporation in the preceding 18-month period, to purchase products or services directly competitive with those sold or provided by the Corporation from any entity other than the Corporation; (iii) solicit for employment, engage and/or hire, whether directly or indirectly, any individual who is then employed by the Corporation or engaged by the Corporation as an independent subcontractor or consultant; and/or (iv) encourage or induce, whether directly or indirectly, any individual who is then employed by the Corporation or engaged by the Corporation as an independent contractor or consultant to end his/her business relationship with the Corporation; provided, however, nothing in this paragraph 7.d. shall prevent the Executive from owning, solely as an investment, up to 5% of the securities of any publicly-traded company.

 

e.           Non-Disparagement.  During the Executive’s employment and at any time thereafter, the Executive agrees not to disparage, either orally or in writing, in any material respect the Corporation or any of its current or former employees, officers or directors, and will not authorize others to do so on Executive’s behalf. Notwithstanding the foregoing, nothing in this paragraph 7.e. shall preclude the Executive from (i) enforcing his rights under this Agreement or responding truthfully to legal process or governmental inquiry, (ii) in the course of and consistent with his duties for the Corporation, evaluating or discussing the performance or conduct of other officers and/or employees, including in connection with performance evaluations or (iii) from providing truthful testimony or information in any proceeding or in response to any request from any governmental agency or any judicial, arbitral or self-regulatory forum or as otherwise required by law, subject to the Executive providing the Corporation with as much prior written notice as is practicable under the circumstances.

 

f.           Cooperation.  The Executive agrees, without receiving additional compensation and upon reasonable notice, to cooperate fully with the Corporation and its legal counsel on any matters relating to the Executive’s employment with the Corporation in which the Corporation reasonably determines that the Executive’s cooperation is necessary or appropriate.  The Corporation shall reimburse the Executive for reasonable and pre-approved travel and other similar out-of-pocket expenses incurred as a result of any such cooperation.

 

g.           Injunctive Relief; Remedy.  The Executive acknowledges that a breach or threatened breach of any of the terms set forth in this paragraph 7 may result in an irreparable and continuing harm to the Corporation for which there may be no adequate remedy at law. The Corporation shall, without posting a bond, be entitled to seek injunctive and other equitable relief, in addition to any other remedies available to the Corporation.

 

h.           Essential and Independent Agreements.  It is understood by the parties hereto that the Executive’s obligations and the restrictions and remedies set forth in this paragraph 7 are essential elements of this Agreement and that but for his agreement to comply with and/or agree to such obligations, restrictions and remedies, the Corporation would not have entered into this Agreement or employed (or continued to employ) him. The Executive’s obligations and the restrictions and remedies set forth in this paragraph 7 are independent agreements and the existence of any claim or claims by him against the Corporation under this Agreement or otherwise will not excuse his breach of any of his obligations or affect the restrictions and remedies set forth under this paragraph 7.

 

i.           Survival of Terms; Representations.  The Executive’s obligations under this paragraph 7 hereof shall remain in full force and effect notwithstanding the termination of his employment. The Executive acknowledges that he is sophisticated in business, and that the restrictions and remedies set forth in this paragraph 7 do not create an undue hardship on him and will not prevent him from earning a livelihood. The Executive further acknowledges that he has had a sufficient period of time within which to review this Agreement, including, without limitation, this paragraph 7, with an attorney of his choice and he has done so to the extent he desired. The Executive and the Corporation agree that the restrictions and remedies contained in this paragraph 7 are reasonable and necessary to protect the Corporation’s legitimate business interests regardless of the reason for or circumstances giving rise to such termination and that he and the Corporation intend that such restrictions and remedies shall be enforceable to the fullest extent permissible by law. The Executive agrees that given the scope of the Corporation’s business and the sophistication of the information highway, any further geographic limitation on such remedies and restrictions would deny the Corporation the protection to which it is entitled hereunder. If it shall be found by a court of competent jurisdiction that any such restriction or remedy is unenforceable but would be enforceable if some part thereof were deleted or modified, then such restriction or remedy shall apply with such modification as shall be necessary to make it enforceable to the fullest extent permissible under law.

 

j.           “Corporation”.  For purposes of the provisions of this paragraph 7, the term “Corporation” shall be deemed to include the Corporation and any of its subsidiaries and/or controlled affiliates.

 

8.              Successors.  This Agreement shall inure to the benefit of and be binding upon the parties, their legal representatives and successors and assigns. However, the Executive’s performance hereunder is personal to the Executive and shall not be assignable by the Executive. The Corporation may assign this Agreement and its rights and obligations to any affiliate or to any successor to all or substantially all of the business and/or assets of the Corporation, whether directly or indirectly, by purchase, merger, consolidation, acquisition of stock, or otherwise.

 

9.              Miscellaneous.

 

a.           Compliance with Section 409A.

 

(i)           It is the intention of the parties that all payments and benefits under this Agreement (and any amendment hereto) shall be made and provided in a manner that is either exempt from or intended to avoid taxation under Section 409A of the Internal Revenue Code and the rules, regulations and notices thereunder (“Code Section 409A”), to the extent applicable.  Any ambiguity in this Agreement (or any amendment hereto) shall be interpreted to comply with the above.  The Executive acknowledges that the Corporation has made no representations as to the treatment of the compensation and benefits provided hereunder and the Executive has been advised to obtain his own tax advice.  Each amount or benefit payable pursuant to this Agreement (and any amendment hereto) shall be deemed a separate payment for purposes of Code Section 409A.  For all purposes under this Agreement, any iteration of the word “termination” (e.g., “terminated”) with respect to the Executive’s employment, shall mean a separation from service within the meaning of Code Section 409A. Without limiting the generality of the foregoing, for purposes of this Agreement (including paragraph 6 hereof), the Executive shall be considered to have a termination of employment only if such termination is a “separation from service” within the meaning of Code Section 409A.

 

(ii)           To the extent that the reimbursement of any expenses or the provision of any in-kind benefits pursuant to this Agreement is subject to Code Section 409A, (A) the amount of such expenses eligible for reimbursement, or in-kind benefits to be provided hereunder during any one calendar year shall not affect the amount of such expenses eligible for reimbursement or in-kind benefits to be provided hereunder in any other calendar year; provided, however, that the foregoing shall not apply to any limit on the amount of any expenses incurred by the Executive that may be reimbursed or paid under the terms of the Corporation’s medical plan, if such limit is imposed on all similarly situated participants in such plan; (B) all such expenses eligible for reimbursement hereunder shall be paid to the Executive no later than December 31st of the calendar year following the calendar year in which such expenses were incurred or such earlier date as provided under the Corporation’s policies; and (C) the Executive’s right to receive any such reimbursements or in-kind benefits shall not be subject to liquidation or exchange for any other benefit.

 

(iii)           Notwithstanding anything else in this Agreement to the contrary, if any payments or benefits under this Agreement, including the severance payment payable under paragraph 6.g. above, constitute “nonqualified deferred compensation” subject to Code Section 409A at the date of employment termination, then such payment, to the extent required under Code Section 409A, shall be made (or begin to be made) six months and one day after the Executive’s “separation from service” as defined in Code Section 409A(a)(2)(A)(i) (or if earlier the date of the Executive’s death), if the Executive is a “specified employee” as defined in Code Section 409A(a)(2)(B)(i) and as reasonably determined in good faith by the Corporation.  In the event that any payment is subject to the foregoing delay, then the Corporation shall (provided it shall not result in the imposition of additional taxes by reason of Code Section 409A(b)(2)), at its sole expense, (A) contribute the amount of such payments to an irrevocable grantor trust in the form prescribed by Revenue Procedure 92-64 (the “Trust”) within 60 days after the Executive’s termination of employment, and (B) direct the trustee of the Trust to pay such amount, together with the earnings of the Trust, less applicable withholding and payroll deductions, to the Executive on the first day following the expiration of such delay or, if earlier, the Executive’s death (subject only to the limitations with respect to the Corporation’s insolvency, if any, as prescribed under the Trust and required to satisfy Revenue Procedure 92-64).

 

b.           Clawback.  Notwithstanding any other provision of this Agreement to the contrary, any incentive compensation (whether cash or equity) received by the Executive which is subject to recovery under any law, government regulation, order or stock exchange listing requirement, will be subject to such deductions and clawback (recovery) as may be required to be made pursuant to law, government regulation, order, stock exchange listing requirement (or any policy of the Corporation adopted pursuant to any such law, government regulation, order or stock exchange listing requirement) (any “Policy”). The Executive agrees and consents to the Corporation’s application, implementation and enforcement of (i) any Policy and (ii) any provision of applicable law relating to cancellation, rescission, payback or recoupment of incentive compensation, and expressly agrees that the Corporation may take such actions as are necessary to effectuate any Policy, any similar policy (as applicable to the Executive) or applicable law without further consent or action being required by the Executive. To the extent that the terms of this Agreement and any Policy conflict, then the terms of such Policy shall prevail.

 

c.           Waiver; Amendment.  The failure of a party to enforce any term, provision, or condition of this Agreement at any time or times shall not be deemed a waiver of that term, provision, or condition for the future, nor shall any specific waiver of a term, provision, or condition at one time be deemed a waiver of such term, provision, or condition for any future time or times. This Agreement may be amended or modified only by a writing signed by both parties hereto.

 

d.           Governing Law; Jurisdiction.  This Agreement shall be governed and construed in accordance with the laws of the Commonwealth of Virginia without giving effect to principles of conflicts of law.  The parties hereby irrevocably consent to the jurisdiction of the federal and state courts located in the Eastern District of Virginia or Fairfax County, Virginia, and by the execution and delivery of this Agreement, each of the parties hereto accepts for itself the exclusive jurisdiction of the aforesaid courts and irrevocably consents to the jurisdiction of such courts (and the appropriate appellate courts) in any proceedings, and waives any objection to venue laid therein.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT HE OR IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT.

 

e.           Tax Withholding.  The payments and benefits under this Agreement may be compensation and as such may be included in either the Executive’s W-2 earnings statements or 1099 statements. The Corporation may withhold from any amounts payable under this Agreement such federal, state or local taxes as shall be required to be withheld pursuant to any applicable law or regulation.

 

f.           Paragraph Captions.  Paragraph and other captions contained in this Agreement are for reference purposes only and are in no way intended to describe, interpret, define or limit the scope, extent or intent of this Agreement or any provision hereof.

 

g.           Severability.  Each provision of this Agreement is intended to be severable. If any term or provision hereof is illegal or invalid for any reason whatsoever, such illegality or invalidity shall not affect the validity of the remainder of this Agreement.

 

h.           Integrated Agreement.  This Agreement constitutes the entire understanding and agreement between the parties hereto with respect to the subject matter hereof, and supersedes all prior agreements, including, without limitation, the offer letter dated May 22, 2014, understandings, memoranda, term sheets, conversations and negotiations.  There are no agreements, understandings, restrictions, representations or warranties between the parties other than those set forth herein or herein provided for.

 

i.           Interpretation; Counterparts.  No provision of this Agreement is to be interpreted for or against any party because that party drafted such provision. For purposes of this Agreement: “herein,” “hereby,” “hereinafter,” “herewith,” “hereafter” and “hereinafter” refer to this Agreement in its entirety, and not to any particular subsection or paragraph. This Agreement may be executed in any number of counterparts, including by facsimile or PDF, each of which shall be deemed an original, and all of which shall constitute one and the same instrument.

 

j.           Notices.  All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand delivery, by facsimile (with confirmation of transmission), by e-mail, by overnight courier, or by registered or certified mail, return receipt requested, postage prepaid, in each case addressed as follows:

 

If to the Executive, at the address set forth above;

 

If to the Corporation:

 

Intersections Inc.

3901 Stonecroft Boulevard

Chantilly, Virginia  20151

Attention: Chief Legal Officer

Facsimile: 703-488-1757

 

with copies (which shall not constitute notice) to:

 

Stroock & Stroock & Lavan LLP

180 Maiden Lane

New York, New York  10038-4982

Attention:  Todd E. Lenson

Facsimile:  212-806-6006

 

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notices and communications shall be effective when actually received by addressee.

 

k.           No Limitations.  The Executive represents his employment by the Corporation hereunder does not conflict with, or breach any confidentiality, non-competition or other agreement to which he is a party or to which he may be subject.

  

[Remainder of Page Intentionally Left Blank]

 

IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement as of the date first above written.

 

	
 

INTERSECTIONS INC.

	 	
 

EXECUTIVE

	  	 	  
	  	 	  
	
By:

	

/s/ Michael Stanfield

	 	

/s/ Johan J. Roets

	  	
Michael Stanfield

	 	
Johan J. Roets

	  	
Chief Executive Officer

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00239-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00239-of-00352.parquet"}]]