death; or (3) 60 days after the termination of the participant’s service with the Company for any reason other than cause or the participant’s death; provided that, if during any part of such 60 day period the option is not exercisable solely because of specified securities law restrictions, the option will not expire until the earlier of the expiration date or until it has been exercisable for an aggregate period of 60 days after the termination of the participant’s service with the Company. The options vested as provided for in each option agreement and the exercise prices for the options were determined by the Board at the time the option was granted, provided that the exercise price could in no event be less than the fair market value per share of our common stock on the grant date. In the event of any change in the common stock underlying the options, by reason of any merger or exchange of shares of common stock, the Board shall make such substitution or adjustment as it deems to be equitable to (1) the class and number of shares underlying such option, (2) the exercise price applicable to such option, or (3) any other affected terms of such option.
In the event of a change of control, unless specifically modified by an individual option agreement: (1) all options outstanding as of the date of such change of control will become fully vested; and (2) notwithstanding (1) above, in the event of a merger or share exchange, the Board may, in its sole discretion, determine that any or all options granted pursuant to the 2006 Plan will not vest on an accelerated basis if the Board, the surviving corporation, or the acquiring corporation, as the case may be, has taken such action that in the opinion of the Board is equitable or appropriate to protect the rights and interests of the participants under the 2006 Plan.
2024 Equity Incentive Plan
Our stockholders approved the 2024 Plan on August 7, 2024 (the “Effective Date”). As a result of such approval, no further awards will be made under the 2006 Plan. Subject to adjustment as provided in the 2024 Plan, as of the Effective Date, 1,376,556 shares of our common stock were available for issuance under the 2024 Plan. When outstanding awards issued under the 2024 Plan or the 2006 Plan are forfeited, cancelled, settled, paid in cash, or expire before being exercised or settled in full, the shares subject to such awards will again be available for issuance under the 2024 Plan.
Awards under the 2024 Plan may be granted to employees, non-employee directors, and consultants of the Company and its subsidiaries in the form of incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock, restricted stock units, and other equity-based or equity-related awards. The 2024 Plan is administered by the Compensation Committee of the Board.
The stock options granted under the 2024 Plan typically vest over a period of up to three years and have a maximum ten-year term. The options are granted at an exercise price equal to the fair market value of the common stock on the date of the grant.
Employment Agreement with Mr. Frank
Effective May 23, 2023, the Board appointed Morgan Frank as Sanuwave’s interim Chief Executive Officer. In connection with this appointment, Sanuwave and Mr. Frank entered into an Executive Employment Agreement, effective May 23, 2023 (the “Frank Employment Agreement”). Pursuant to the Frank Employment Agreement, Mr. Frank is paid a de minimis base salary of $1.00 per year, which was increased to $3,704 per year as of August 2024, may be eligible to receive an incentive bonus opportunity in accordance with certain performance criteria determined by the Board, and is entitled to participate in the Company’s employee benefit plans and programs. Mr. Frank’s employment will be terminated upon (i) written notice of termination or resignation by either the Company or Mr. Frank, respectively, for any reason, provided that Mr. Frank must provide at least 60 days’ prior notice of his resignation, or (ii) Mr. Frank’s death or disability. Moreover, during the term of his employment and for a period of one year thereafter, Mr. Frank agreed (i) not to perform services for or have any interest in any competitive business and (ii) not to solicit (a) our current or former employees or independent contractors or (b) actual or prospective customers, clients, vendors, service providers, suppliers, or contractors. Finally, the Frank Employment Agreement also includes customary confidentiality and non-disparagement provisions.
Offer Letter with Mr. Coyle
Effective October 1, 2024, Daniel Coyle joined the Company as Vice President of Engineering and Operations. The Company and Mr. Coyle entered into an offer letter dated September 6, 2024 (the “Coyle Offer Letter”). Pursuant to the Coyle Offer Letter, Mr. Coyle (i) received an annual base salary of $190,000, (ii) was eligible to earn an annual bonus of 25% of his base salary, based on the achievement of performance goals established by the Company, (iii) received an option grant, and (iv) received a signing bonus of $5,000. Effective September 25, 2025, Daniel Coyle
