EX-10.31 33 b64188hlexv10w31.txt EX-10.31 EMPLOYMENT AGREEMENT-DAVID MCINTYRE Exhibit 10.31 HEARTWARE LIMITED DAVID MCINTYRE EXECUTIVE SERVICE AGREEMENT . . . CONTENTS 1. INTERPRETATION 1 1.1 Definitions 1 1.2 Interpretation 3 1.3 Headings 4 2. EMPLOYMENT OF EXECUTIVE 4 2.1 Appointment 4 2.2 Term 4 2.3 Warranty 4 3. LOCATION 4 3.1 Place of employment 4 3.2 Travel 4 4. HOURS OF WORK 4 5. DUTIES 5 5.1 General Duties 5 5.2 Specific Duties 6 5.3 Corporate Offices 6 5.4 Other employment 6 6. REMUNERATION 6 6.1 Remuneration package 7 6.2 Cash salary payments 7 6.3 Remuneration Package review 7 6.4 Additional benefits 7 7. EXPENSES 8 8. PROFESSIONAL QUALIFICATIONS AND MEMBERSHIPS 9 9. ANNUAL LEAVE 9 9.1 Entitlement to annual leave 9 9.2 Taking annual leave 9 10. SICK LEAVE 9 11. LONG SERVICE LEAVE 9 12. INTELLECTUAL PROPERTY 9 13. CONFIDENTIAL INFORMATION 10 13.1 Duty of confidentiality 10 13.2 Use of Confidential Information 10 13.3 Security of Confidential Information 10 13.4 Uncertainty 10 14. TERMINATION 10 14.1 Termination by the Executive on notice 10
i 14.2 Termination by the Company on notice 11 14.3 Termination by the Company for Cause 11 14.4 Payment in lieu of notice 12 14.5 Garden leave 12 14.6 Acceleration of Options 13 14.7 Disciplinary and grievance procedures 13 14.8 Payment of accrued entitlements upon termination 13 14.9 No compensation 13 14.10 Right of set-off 13 15. NON-COMPETITION 14 15.1 Non-compete 14 15.2 Construction of Non-compete clause 15 15.3 Severability 15 15.4 Executive may hold shares 15 16. ACKNOWLEDGMENT 15 17. RETURN OF PROPERTY 16 17.1 Return of property 16 17.2 Destruction of property 16 18. SEVERANCE 16 19. NOTICES 16 19.1 General 16 19.2 How to give a communication 17 19.3 Particulars for delivery of notices 17 19.7 Process service 17 20. MISCELLANEOUS 17 20.1 Governing Jaw 17 20.2 Assignment 17 20.3 No waiver 17 20.4 Amendment 17 20.5 Entire understanding 18
ii DATE PARTIES HEARTWARE Limited ACN 111 970 256 of Level 1, 1 Bligh Street, Sydney, New South Wales, 2000 (COMPANY) DAVID MCINTYRE of 978 Forest Road, Lugarno, New South Wales 2210 (EXECUTIVE) BACKGROUND A Provided that the Company is admitted to the Official List of the Australian Stock Exchange Limited, the Company wishes to employ the Executive the position of Chief Financial Officer, and the Executive has agreed to accept employment as Chief Financial Officer on the terms and conditions set out in this document. AGREED TERMS 1. INTERPRETATION 1.1 DEFINITIONS In this document: BASE SALARY means the amount specified as Base Salary in Schedule 1 to this Agreement or such other amount as may be determined by the Board pursuant to clause 6.3. BOARD means the board of directors of the Company. BUSINESS means any corporation, partnership, joint venture, undertaking, trust or enterprise. BUSINESS DAY means a day other than a Saturday, Sunday or bank or public holiday In New South Wales. CASH SALARY means the amount of the Executive's Remuneration Package as defined in CLAUSE 6.1 that the Executive elects to receive by way of cash payment. COMMENCEMENT DATE means the date agreed by the Executive and the Company as the date upon which the Executive commences employment with the Company. CONFIDENTIAL INFORMATION means any information, however communicated or recorded, relating to the business of the Company or any Group Company to which the Executive gains access, whether before, during or after the Executive's employment with the Company, and includes: (a) any trade secret or other commercially sensitive or confidential information of or possessed by the Company or any Group Company, or any person or entity with which the Company or any Group Company deals or is concerned; (b) any techniques, methods, computer software, materials, documents or manuals of the Company or any Group Company used in their businesses; (c) information concerning products developed or used by the Company or any Group Company, their customers and suppliers; (d) inventions, improvements or products discovered or developed by any employee, officer, contractor or consultant of the Company or any Group Company; (e) Information relating to the business affairs, accounts, business plans, market research, marketing plans, sales plans, customer lists, prospects, management or finances of the Company or any Group Company, or any person or entity with which the Company or any Group Company deals or is concerned; (f) the identity of the customers, suppliers, consultants, distributors, agents, contractors and employees of the Company or any Group Company and the arrangements between any of these persons or entities; (g) any information of or possessed by the Company or any Group Company which is marked as confidential, is by its nature confidential, or the Executive knows or ought to know is confidential; and (h) the terms of this document, but excludes any information which, without breach of this document or other breach of confidence by the Executive, is or becomes public knowledge. EMPLOYEE SHARE OPTION PLAN means the Company's employee share option plan as varied from time to time. EMPLOYMENT means the employment of the Executive under this document. GROUP means the Company and the Group Companies. GROUP COMPANY means a body corporate which is related to the Company within the meaning of section 50 of the Corporations Act 2001 and any associated company, including but not limited to HeartWare Inc. INTELLECTUAL PROPERTY includes, but is not limited to, ideas, designs, patents, trade marks, copyright (including moral rights) and designs whether registered or unregistered, software developments, computer programs, security codes, circuit layout rights and know-how, inventions and improvements in procedures made or discoveries conceived. LISTING means the Company's admission to the Official List of the Australian Stock Exchange Limited. RELEVANT PERIOD means the period of 12 months immediately preceding the date on which the Employment terminates. 1.2 INTERPRETATION Unless expressed to the contrary, in this document (a) words in the singular include the plural and vice versa; (b) any gender includes the other genders; (c) if a word or phrase is defined, its other grammatical forms have corresponding meanings; (d) "includes" means includes without limitation; (e) a reference to: (i) a person includes a partnership, joint venture, unincorporated association, corporation and a government or statutory body or authority; (ii) a person includes its legal personal representatives, successors and assigns; (iii) any legislation includes subordinate legislation under it and includes that legislation and subordinate legislation as modified or replaced; (iv) an obligation includes a warranty or representation and a reference to a failure to comply with an obligation includes a breach of warranty or representation; (v) a right includes a benefit, remedy, discretion and power; (vi) "$" or "dollars" is a reference to the lawful currency of Australia; (vii) writing includes any mode of representing or reproducing words in tangible and permanently visible form, and includes facsimile transmission; (viii) this document includes all schedules and annexures to it; and (ix) a policy of the Company means any policy of the Company in relation to the relevant subject matter as created, varied or replaced from time to time. 1.3 HEADINGS Headings do not affect the interpretation of this document. 2. EMPLOYMENT OF EXECUTIVE 2.1 APPOINTMENT (a) Subject to the Company's Official Listing on the Australian Stock Exchange Limited (Listing), the Company will employ the Executive and the Executive will serve the Company as Chief Financial Officer. (b) The Executive's employment with the Company is conditional upon the Company's Listing, and in the event that such Listing does not proceed, the Executive will not be employed by the Company, and the Executive will not be entitled to any compensation from the Company In relation thereto. 2.2 TERM The Employment will commence on the Commencement Date and will continue until terminated in accordance with clause 15 of this Agreement. 2.3 WARRANTY The Executive represents and warrants to the Company that he has the legal right to enter into this Agreement and in performing his duties and obligations under this document, he will not be in breach of any obligation to a third party, including any restrictive covenant or confidentiality obligation. 3. LOCATION 3.1 PLACE OF EMPLOYMENT The Employment will be based primarily at the Company's premises in Sydney or such other place or places as the Company may reasonably direct. 3.2 TRAVEL The Executive will be required to travel regularly to the Group's other offices and may be required to undertake other travel within and outside Australia in the performance of his duties. The Executive will not be entitled to any additional remuneration for such travel but the expenses of such travel, including accommodation and meals, will be paid for by the Company in accordance with its policies. 4. HOURS OF WORK The Executive will work during the normal business hours of the Company and such other hours as are necessary for the Executive to perform the Executive's duties in a satisfactory manner. The Executive will not be entitled to any additional remuneration for work outside normal business hours. 5. DUTIES 5.1 GENERAL DUTIES The Executive will: (a) carry out the duties and responsibilities which would normally be expected of the position of Chief Financial Officer and Company Secretary in similar organisations including, but not limited to, responsibility for regulatory and compliance functions and accounting and tax matters, for the Group; (b) perform the duties assigned to the Executive from time to time and comply with all lawful and reasonable directions given to the Executive by the Board and any person duly authorised by the Board; (c) subject to any written consent given by the Board under CLAUSE 5.4(B) and except in the case of absence by reason of illness or incapacity or while on leave in accordance with this document, devote the whole of the Executive's time, attention and abilities during normal business hours and such other hours as are necessary for the Executive to perform the Executive's duties in a satisfactory manner, exclusively to the business of the Company and the Group Companies; (d) use the Executive's best endeavours to promote and enhance the interests, welfare, business, profitability, growth and reputation of the Company and the Group Companies; (e) act in the best interests of the Group and not intentionally do anything which is or may be harmful to the Company or any Group Company; (f) perform the Executive's duties and responsibilities in a proper and efficient manner; (g) subject to the terms of this document, comply with the Company's policies as varied from time to time; (h) promptly report to the Board or such person as the Board may from time to time determine, all information and explanations as it may require in connection with matters relating to the Employment or the business of the Company or any Group Company; (i) not act, or be seen to be acting, in conflict with the best interests of the Company or any Group Company. 5.2 SPECIFIC DUTIES Without limiting the generality of CLAUSE 5.1, the Board may assign specific duties to the Executive and may alter the Executive's duties from time to time after discussion with the Executive. 5.3 CORPORATE OFFICES The Executive agrees: (a) upon request by the Board, to accept appointment to and to serve in any other office or offices as director, secretary, public officer or otherwise of the Company or any Group Company without additional compensation or reward; and (b) upon request by the Board and unless otherwise agreed by the Board, to resign, on termination of the Employment, from any office or offices held at that time. 5.4 OTHER EMPLOYMENT (a) Subject to CLAUSE 5.4(B), the Executive will not, during the Employment: (i) carry on, advise, provide services to or be engaged, concerned or interested in or associated with any business or activity which is in competition with any business carried on by the Company or any Group Company; or (ii) without the prior written consent of the Company, be engaged or interested in any other public or private work or duties, either directly or indirectly, in any capacity (including as principal, agent, partner, employee, shareholder, unitholder, joint venturer, director, trustee, beneficiary, manager, consultant or advisor), (b) The Executive may: (i) hold or acquire shares (whether directly or through nominees) in aggregate not more than 5% of the issued ordinary shares in the capital of any body corporate listed on a recognised stock exchange; (ii) manage his private investments; or (iii) participate In charitable, civic, educational, professional or community affairs or serve on the board of directors or advisory committees of non-profit entities provided that such activities do not interfere with the Executive's capacity to discharge his duties pursuant to CLAUSES 5.1, 5.2 and 5.3 of this Agreement. 6. REMUNERATION 6.1 REMUNERATION PACKAGE The Company will provide the Executive with the remuneration package (REMUNERATION PACKAGE) specified in SCHEDULE 1 or such other rate as may be determined from time to time on review under CLAUSE 6.3. The Remuneration Package will comprise Base Salary, superannuation contributions made by the Company to a complying fund on the Executive's behalf, motor vehicle and other non-salary benefits as set out in SCHEDULE 1 or as otherwise agreed from time to time, provided that the superannuation component shall be at least the minimum amount required in accordance with the Superannuation Guarantee Administration Act 1992. The Executive will be required to meet the costs of any fringe benefits tax or other tax payable by the Company In consequence of the provision of the Remuneration Package (except for the benefits provided to the Executive in SCHEDULE 1, PARAGRAPH (C)) including goods and services tax but excluding any pay-roll tax and tax on the corporate profits of the Company. 6.2 CASH SALARY PAYMENTS The Executive's Cash Salary will be paid monthly by electronic deposit into an account nominated by the Executive. 6.3 REMUNERATION PACKAGE REVIEW The Remuneration Package will be reviewed by the Board each year, on such basis as the Board in its absolute discretion may determine having regard to the performance of the Executive and the circumstances of the Company. The Remuneration will not be reduced without the consent of the Executive unless the Board decides to reduce the remuneration of all senior executives of the Group, in which case the Executive's Remuneration Package will be reduced by the same percentage as the percentage reduction applied to the remuneration of other senior executives within the Group. 6.4 ADDITIONAL BENEFITS (a) BONUS SCHEME (i) In addition to the Remuneration Package, the Executive may be granted an annual performance-based bonus payment of up to $30,000 in accordance with the Company's performance-based bonus scheme. (ii) The amount of the bonus payable to the Executive (if any) will be determined by the Board in its absolute discretion having regard to the performance of the Company and the Executive against key performance indicators as determined by the Company following consultation with the Executive. (iii) The key performance indicators for the Executive's first year of employment will be determined at the first Board meeting after the Commencement date. (b) EMPLOYEE SHARE OPTION PLAN (i) The Executive will be entitled to be granted options under the Company's employee share option plan (OPTION SHARES) equal to half of one per cent (0.5%) of the issued capital on Listing. The exercise price and vesting of the Option Shares will be as follows:
% OF OPTIONS EXERCISE PRICE VESTING DATE ------- -------------- ------------ 25% AUD$0.60 First Anniversary of Commencement Date 25% AUD$0.75 Second Anniversary of Commencement Date 25% AUD$1.00 Third Anniversary of Commencement Date 25% AUD$1.50 Fourth Anniversary of Commencement Date
(ii) Except as provided for in CLAUSE 14.6, the Executive's right to exercise the options granted pursuant to CLAUSE 6.4(B)(I) is subject to the Executive's continued employment with the Company on the relevant vesting date and the terms of the Employee Share Option Plan. (iii) Should there be a significant dilutionary event affecting the Company, the Board will, at its sole discretion, review the Executive's share option entitlements having taken into account factors such as the achievement of specific milestones and other performance measures. The Board will also take into account the overall level of the Employee Share Option Plan. (c) OTHER BENEFITS (i) The Executive will be provided with a car parking space at or near the Company's Sydney office in accordance with Company policy. (ii) The Executive will be entitled to other benefits, such as participation in group insurance schemes, in accordance with Company policies. 7. EXPENSES The Company will reimburse the Executive for all reasonable expenses properly incurred by the Executive in the performance of the Executive's duties, subject to Company policies and provision of any documentary evidence (including goods and services tax receipts) reasonably required by the Company. 8. PROFESSIONAL QUALIFICATIONS AND MEMBERSHIPS The Company agrees to provide the Executive with reasonable time off for the purposes of maintaining his professional qualifications and membership of professional bodies, provided that such time off does not interfere with the operational requirements of the Company's business. 9. ANNUAL LEAVE 9.1 ENTITLEMENT TO ANNUAL LEAVE The Executive will be entitled to four weeks' paid annual leave for each year of continuous service with the Company, accruing on a pro-rata basis. 9.2 TAKING ANNUAL LEAVE Annual leave will be taken at times approved by the Chief Executive Officer. If the Executive accrues more than eight weeks of annual leave, the Chief Executive Officer may direct the Executive to take some or all of the Executive's accrued annual leave entitlement upon eight weeks' written notice. 10. SICK LEAVE The Executive is entitled to ten days' paid sick leave in each complete year of service. Sick leave is cumulative, but no payment will be made in respect of untaken sick leave on termination of the Employment. Additional paid sick leave may be approved by the Board in its absolute discretion. The Company may require a medical certificate for absences of more than two days. 11. LONG SERVICE LEAVE The Executive will be entitled to long service leave in accordance with the Long Service Leave Act 1955 (NSW). 12. INTELLECTUAL PROPERTY The Executive acknowledges and agrees that all Intellectual Property developed, created or conceived by the Executive (whether alone or with others) during the Employment and which is related to or may be adapted to the business of the Company or any Group Company is and will be the sole and exclusive property of the Company. The Executive further acknowledges and agrees that: (a) full right, title and interest in copyright works created by the Executive will vest in the Company immediately on creation; (b) full right, title and interest in all other intellectual Property is assigned to the Company by the Executive; (c) the Executive will promptly execute all documents and do all things necessary to vest or assign full right, title and interest in the Intellectual Property in and to the Company; and (d) the Executive irrevocably and unconditionally waives all moral rights and any equivalent or analogous rights. 13. CONFIDENTIAL INFORMATION 13.1 DUTY OF CONFIDENTIALITY The Executive must keep confidential all Confidential Information and must not, both during the Employment and after it ends, disclose or allow to be disclosed any Confidential Information to any person except: (a) if the Executive has been authorised in writing by the Board to do so; (b) to the agents, employees or advisers of the Company or a Group Company in the proper performance of the Executive's responsibilities and duties; (c) if the Executive is required by law to do so. In this case, no more Confidential Information must be disclosed than is strictly required and the Executive must take all reasonable steps to ensure the disclosed Confidential Information is treated confidentially; or (d) in respect of the terms of this document, in confidence to the Executive's legal or financial advisers or members of the Executive's immediate family. 13.2 USE OF CONFIDENTIAL INFORMATION The Executive must not use any Confidential Information for the benefit of any person other than the Company or a Group Company. 13.3 SECURITY OF CONFIDENTIAL INFORMATION The Executive must maintain effective security measures to protect all Confidential Information from unauthorised access, use, copying or disclosure. 13.4 UNCERTAINTY If there is any uncertainty as to whether any information is Confidential Information, that information must be treated as Confidential Information unless the Executive is advised by the Board in writing to the contrary. 14. TERMINATION 14.1 TERMINATION BY THE EXECUTIVE ON NOTICE After the initial Term, the Executive may terminate this Agreement upon giving three months' written notice. 14.2 TERMINATION BY THE COMPANY ON NOTICE The Company may at any time terminate the Employment by giving three months' written notice to the Executive. 14.3 TERMINATION BY THE COMPANY FOR CAUSE Without limiting the generality of CLAUSE 14.2, the Company may at any time immediately terminate the Employment by giving written notice to the Executive if the Executive: (a) commits any act of serious misconduct; (b) fails or refuses to comply with any lawful and reasonable direction given by the Company; (c) intentionally commits a serious or persistent breach of this document which is detrimental to the Company or any Group Company and Is incapable of rectification; (d) commits any serious or persistent breach of this document which continues unremedied for 10 days after written notice of that breach has been given to the Executive; (e) commits any act (whether in the course of the Employment or not) which in the reasonable opinion of the Board brings the Executive into disrepute or may cause damage to the reputation of the Executive, the Board, the Company or any Group Company or otherwise affect adversely the interests of the Company or any Group Company; (f) is convicted of any offence (whether in the course of the Employment or not) involving fraud or dishonesty or any other serious offence (except for a traffic offence) which is punishable by imprisonment (whether the Executive is Imprisoned or not); (g) is bankrupt, is declared bankrupt or enters into any composition or arrangement with or makes any assignment of the Executive's property in favour of the Executive's creditors generally; (h) is precluded from taking part in the management of a corporation by the provisions of the Corporations Act 2001; (i) becomes of unsound mind or a person whose person or estate is liable to be dealt with in any way under laws relating to mental health; or (j) is incapacitated by physical or mental illness, accident or any other circumstances beyond the Executive's control: (A) for a period of 120 consecutive days or an aggregate period of 120 days in any 12 month period, or (B) for a period of less than 120 consecutive days or an aggregate period of 120 days in any 12 month period where a medical practitioner nominated by the Company and its insurers determines that the Executive is totally and permanently Incapacitated, and such determination is accepted by the Executive or his legal representative, such acceptance not being unreasonably withheld. Where the Executive's employment is terminated pursuant to CLAUSE 14.3, the Company must specify in reasonable detail in the notice of termination the basis for such termination. Where the Executive's employment Is terminated pursuant to CLAUSE 14.3(J) he will be paid three months' Remuneration. 14.4 PAYMENT IN LIEU OF NOTICE The Company may substitute payment in lieu of any part or all of any period of notice of termination. Such payment shall be calculated at the rate of the Remuneration Package payable to the Executive immediately prior to the termination of his employment. 14.5 GARDEN LEAVE During: (a) part or all of any period of notice of termination given by the Executive or the Company; or (b) any period not exceeding two weeks during which the Company is investigating any disciplinary issue involving the Executive, the Company may, at its sole discretion: (c) require the Executive to perform only such duties as the Company may determine or not to perform any duties at all; and/or (d) require the Executive not to have any contact with any employees, customers or business associates of the Company or any Group Company other than normal social contact; and/or (e) exclude the Executive from all or any part of the Company's and any Group Company's premises. Provided that the Executive's remuneration will not be withheld or reduced as a result of the Executive complying with such directions. 14.6 ACCELERATION OF OPTIONS If the Executive's employment is terminated by the Company pursuant to CLAUSE 14.2 the unvested share options that the Executive holds shall, on the date of termination of the Executive's employment, accelerate in respect of the immediately following 12 months of vesting, and become immediately exercisable, notwithstanding any share option plan of the Company or any term of this document. 14.7 DISCIPLINARY AND GRIEVANCE PROCEDURES In view of the seniority of the Executive's position, the Company is not required to follow any performance review, disciplinary, warning or grievance procedures before terminating the Employment except as provided for in this document. 14.8 PAYMENT OF ACCRUED ENTITLEMENTS UPON TERMINATION On termination of the Employment, whether pursuant to this CLAUSE 14 or otherwise, the Executive will be entitled to receive from the Company: (a) Remuneration up to and including the date of termination; (b) payment in lieu of any accrued annual leave to which the Executive is entitled up to and including the date of termination, calculated at the rate of the Base Salary payable to the Executive Immediately prior to termination; (c) payment in lieu of any long service leave to which the Executive is entitled up to and including the date of termination calculated at the rate of the Base Salary payable to the Executive immediately prior to termination; 14.9 NO COMPENSATION Upon termination of the Employment in accordance with the express terms of this document, the Executive will not be entitled to claim any compensation or damages from the Company in respect of that termination beyond those specified in this document. 14.10 RIGHT OF SET-OFF (a) Termination of the Employment under any circumstances will not abrogate, impair, release, or extinguish any debt, obligation or liability of the Executive to the Company which may have accrued under this document or otherwise including any debt, obligation or liability which was the cause of termination or arose out of that cause. (b) On termination of the Employment, the Company may set-off any debt, obligation or liability of the Executive to the Company against the Executive's entitlements on termination provided that the Company gives reasonable details in writing of such set-off, including the relevant calculation thereto. 15. NON-COMPETITION 15.1 NON-COMPETE In the event that the Employment is terminated for whatever reason, the Executive will not without the written consent of the Company directly or indirectly whether on the Executive's own account or for any person: (a) (i) perform any services of the type the Executive performed for the Company or any Group Company under this document for any Business engaged in whole or part in competition with any business of the Company or any Group Company; (ii) solicit or endeavour to solicit any director, manager, officer, senior employee or contractor of the Company known personally to the Executive or knowingly employ, assist in or procure the employment by any Business of any such person; (iii) solicit or endeavour to solicit any person who was during the Executive's employment with the Company a customer or client of the Company with a view to providing services to that customer or client which are the same as or similar to the services which the Executive was involved in providing to that customer or client during the Relevant Period; (iv) deal with or accept any approach from or work on any account of any person who was during the Executive's employment with the Company a customer or client of the Company with a view to providing services to that customer or client which are the same as or similar to the services which the Executive was involved in providing to that customer or client during the Relevant Period; (b) for a period of: (i) 6 months; (ii) 3 months; (c) throughout: (i) the world; (ii) Australia, Europe (including the United Kingdom), and the United States; (iii) Australia and Europe (including the United Kingdom); (iv) Australia. 15.2 CONSTRUCTION OF NON-COMPETE CLAUSE CLAUSE 15.1 will be construed and have effect as if it were the number of separate sub-clauses which results from combining the commencement of CLAUSE 15.1 with each sub-paragraph of paragraph (a) and combining each such combination with each sub-paragraph of paragraph (b) and combining each such combination with each sub-paragraph of paragraph (c), each such resulting sub-clause being severable from each other such resulting sub-clause and It is agreed that if any of the resulting sub-clauses shall be invalid or unenforceable for any reason, such invalidity or unenforceability will not prejudice or in any way affect the validity or enforceability of any other such resulting sub-clause. 15.3 SEVERABILITY The Executive agrees that if any of the above restraints or any part of them is held to be invalid or unenforceable for any reason, that restraint or part shall be severed so that the remainder shall remain valid and effective. 15.4 EXECUTIVE MAY HOLD SHARES This CLAUSE 15 shall not restrict the Executive from holding or acquiring (either directly or indirectly) a passive interest in aggregate not more than 3% of the issued ordinary shares in the capital of any Business which is same as or substantially similar to or in competition with any part of the business of the Company or any Group Company, or 5% of the issued ordinary shares in the capital of any other body corporate listed on any recognised stock exchange or from being employed in or engaged by any Business which is same as or substantially similar to or in competition with any part of the business of the Company or any Group Company in a position which is not concerned with the management, strategic direction, marketing or sales functions of that Business. 16. ACKNOWLEDGMENT The Executive acknowledges and agrees that: (a) the Company has spent and will spend effort and money in establishing and maintaining its customer base, employee skills and the Confidential information; (b) the only fair and reasonable manner in which the interests of Company can be protected is by the restraints imposed on the Executive in this Agreement; (c) the Executive has received adequate consideration for the restraint obligations imposed on the Executive in this Agreement; and (d) the duration, extent and application of the respective restraints contained in this Agreement are at the date of this Agreement (and as the parties can at that date foresee) not greater than is reasonably necessary for the protection of the interests of the Company given the nature of the business and undertaking of the Company. The Executive acknowledges that an order for damages would be an inadequate remedy for any breach of CLAUSES 12, 13 or 15.1 and hereby consents and agrees that in the event he commits any breach of any of these clauses: (e) the Company will be entitled to immediate relief by way of Injunction without the necessity to prove any loss or damage; and (f) the Company will be entitled to such permanent orders in restraint of the Executive and to such orders for damages and to such other orders as any Court of competent jurisdiction may think fit upon trial and determination of the issues in dispute. 17. RETURN OF PROPERTY 17.1 RETURN OF PROPERTY Upon termination of the Employment, or at any time upon request by the Board, the Executive will immediately deliver to the Company all property of any description belonging to the Company or any Group Company and all documentation or other material on which is recorded any Confidential Information, whether in physical or electronic form, which is in the Executive's possession, custody or control which is physically capable of delivery. 17.2 DESTRUCTION OF PROPERTY The Executive will, upon request by the Board, destroy any or all of the above items or in relation to any Confidential Information contained in computer software or data, destroy it by erasing it from the medium on which It is stored so that the information cannot be recovered or reconstructed, and certify in writing to the Board that such items or Confidential Information have been destroyed or erased. 18. SEVERANCE Any provision of this document which is or becomes illegal, void or unenforceable in any jurisdiction will be ineffective and severable in that jurisdiction to the extent of the illegality, voidness or unenforceability and will not invalidate the remaining provisions of this document nor affect the validity or enforceability of that provision in any other jurisdiction. 19. NOTICES 19.1 GENERAL A notice, demand, certification, process or other communication relating to this document must be in writing in English and may be given by an agent of the sender. 19.2 HOW TO GIVE A COMMUNICATION In addition to any other lawful means, a communication may be given by being: (a) personally delivered; (b) left at the party's current address for notices; (c) sent to the party's current address for notices by pre-paid ordinary mall or, if the address is outside Australia, by pre-paid airmail; or (d) sent by fax to the party's current fax number for notices. 19.3 PARTICULARS FOR DELIVERY OF NOTICES (a) The particulars for delivery of notices are initially: COMPANY: ________________ Address: as set out above 19.7 PROCESS SERVICE Any process or other document relating to litigation, administrative or arbitral proceedings relating to this document may be served by any method contemplated by this CLAUSE 19 or in accordance with any applicable law. 20. MISCELLANEOUS 20.1 GOVERNING JAW This document is governed by and Is to be construed in accordance with the laws in force in New South Wales and the parties irrevocably and unconditionally submit to the non-exclusive jurisdiction of the Courts of New South Wales and any Courts which have jurisdiction to hear appeals from any of those Courts. 20.2 ASSIGNMENT Neither party will assign any of Its rights under this document. 20.3 NO WAIVER No failure to exercise or any delay in exercising any right, power or remedy under this document will operate as a waiver. Nor will any single or partial exercise of any right, power or remedy preclude any other or further exercise of that or any other right, power or remedy. 20.4 AMENDMENT This document may only be varied or replaced by a document duly executed by the parties. No change to the duties, title, remuneration or responsibilities of the Executive will amount to a variation or termination of this document except to the extent agreed in writing between the parties. 20.5 ENTIRE UNDERSTANDING (a) This document embodies the entire understanding and agreement between the parties as to the subject matter of this document (b) All previous negotiations, understandings, representations, warranties, memoranda or commitments in relation to, or in any way affecting, the subject matter of this document are merged in and superseded by this document and will be of no force or effect whatever and no party will be liable to any other party in respect of those matters. (c) No oral explanation or information provided by any party to another will: (i) affect the meaning or interpretation of this document; or (ii) constitute any collateral agreement, warranty or understanding between any of the parties. SCHEDULE 1 Remuneration Package The Remuneration Package as at the date of this document is as follows: (a) Base Salary: AUD$220,000; (b) Employer superannuation contributions at the rate of 9% of Base Salary; (c) Motor vehicle - Holden Calais or vehicle of equivalent standard. EXECUTED as an agreement EXECUTED by HEARTWARE LIMITED ) ) /s/ Robert Thomas --------------------------------- ---------------------------------------- Company Secretary/Director Director Robert Thomas --------------------------------- Name of Director (print) Name of Company Secretary/Director (print) SIGNED by DAVID MCINTYRE in the ) presence of: ) /s/ David Allen /s/ David McIntyre --------------------------------- ---------------------------------------- Witness David McIntyre David Allen Name of Witness (print)