EXHIBIT 10.8
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this " Agreement") is made this 31st day of
December, 1998 by and between Integra LifeSciences Corporation, a Delaware
corporation, and Xxxxxxx Xxxxxxxxxxxxx ("Executive").
Background
Executive is currently the Senior Vice President, Research & Development
and Director, Corporate Research Center of Company. Company desires to continue
to employ Executive, and Executive desires to remain in the employ of Company,
on the terms and conditions contained in this Agreement. Executive will be
substantially involved with Company's operations and management and will learn
trade secrets and other confidential information relating to Company and its
customers; accordingly, the noncompetition covenant and other restrictive
covenants contained in Section 14 of this Agreement constitute essential
elements hereof.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein and intending to be legally bound hereby, the parties hereto
agree as follows:
Terms
1. Definitions. The following words and phrases shall have the meanings
set forth below for the purposes of this Agreement (unless the context clearly
indicates otherwise):
(a) "Base Salary" shall have the meaning set forth in Section 5.
(b) "Board" shall mean the Board of Directors of Company, or any successor
thereto.
(c) "Cause," as determined by the Board in good faith, shall mean
Executive has --
(1) failed to perform his stated duties and not cured such failure
(if curable) within 15 days of his receipt of written notice of the failure;
(2) breached any provision of this Agreement and not cured such
breach (if curable) within 15 days of his receipt of written notice of the
breach;
(3) demonstrated his personal dishonesty in connection with his
employment by Company;
(4) engaged in willful misconduct;
(5) engaged in a breach of fiduciary duty;
(6) willfully violated any law, rule or regulation, or final
cease-and-desist order (other than traffic violations or similar offenses); or
(7) engaged in other serious misconduct of such a nature that his
continued employment may reasonably be expected to affect Company adversely.
(d) A "Change in Control" of Company shall be deemed to have occurred:
(1) if the "beneficial ownership" (as defined in Rule 13d-3 under
the Securities Exchange Act of 1934) of securities representing more than fifty
percent (50%) of the combined voting power of Company Voting Securities (as
herein defined) is acquired, by any individual, entity or group (a "Person"),
Company, any trustee or other fiduciary holding securities under any employee
of benefit plan of Company or an affiliate thereof, or any corporation owned,
directly or indirectly, by the stockholders of Company in substantially the same
proportions as their ownership of stock of Company (for purposes of this
Agreement, "Company Voting in Securities" shall mean the then outstanding voting
securities of Company entitled to vote generally in the election of directors);
provided, however, that any acquisition from Company or any acquisition pursuant
to a transaction which complies with clauses (i) , (ii) and (iii) of paragraph
(3) of this definition shall not be a Change in Control under this paragraph
(1); or
(2) if individuals who, as of the date hereof, constitute the Board
(the "Incumbent Board") cease for any reason to constitute at least a majority
of the Board; provided, however,: that any individual becoming a director
subsequent to the date hereof whose election, or nomination for election by
Company's stockholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be, considered as though
such individual were a member of the, Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or
(3) upon consummation by Company of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of Company or the acquisition of assets or stock of another entity (a
"Business Combination"), in each case, unless immediately following such
Business Combination: (i) more than 50% of the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of
directors of (x) the corporation resulting from such Business Combination (the
"Surviving Corporation"), or (y) if applicable, a corporation which as a result
of such transaction owns Company or all or substantially all of Company's assets
either directly or through one or more subsidiaries (the "Parent Corporation"),
is represented, directly or indirectly, [Company Voting Securities outstanding
immediately prior to such Business Combination (or, if applicable, is
represented by shares into which such Company Voting Securities were converted
pursuant to such Business Combination), and such voting power among the holders
thereof is in substantially the same proportions as their ownership,
immediately prior to such Business Combination, of the Company Voting
Securities; (ii) no Person (excluding any employee benefit plan (or related
trust) of Company or such corporation resulting from such Business Combination)
beneficially owns, directly or indirectly,] by 50% or more of the combined
voting power of the then outstanding voting securities eligible to elect directs
of the Parent Corporation (or, if there is no Parent Corporation, the Surviving
corporation) except to the extent that such ownership of the Company existed
prior to the Business Combination; and (iii) at least a majority of the members
of the board of directors of the Parent Corporation (or, if there is no Parent
Corporation, the surviving Corporation) were members of the Incumbent Board at
the time of the execution of the initial agreement, or the action of the Board,
providing for such Business Combination; or
(4) Upon approval by the stockholders of company if a complete
liquidation or dissolution of company.
(e) "Code" shall mean the internal Revenue code of 1986, as amended.
(f) "Company" shall mean Integra LifeSciences corporation and any
corporation, partnership of other entity owned directly or indirectly, in whole
or in part, by Integra LifeSciences Corporation
(g) "Disability" shall mean Executive's inability to perform his duties
hereunder by reason of any medically determinable physical or mental impairment
which is expected to result in death or which has lasted or is expected to last
for a continuous period of not fewer than six months.
(h) "Good Reason" shall mean:
(1) a material breach of this Agreement by company which is not
cured by Company within 15 days of its receipt of written notice
of the breach;
(2) without Executive's express written consent, the Board reduces
Executive's Base Salary or the aggregate fringe benefits
provided to Executive (except to the extent permitted by Section
5 or section 6, respectively); provided, Executive resigns with
30 days after the change objected to; or
(3) Company fails to obtain the assumption of this Agreement by any
successor to Company.
(i) "Principal Executive Office" shall mean Company's principal office
for executives, presently located at 000 Xxxxxx Xxxx, Xxxxxxxxxx, Xxx Xxxxxx
00000.
(j) "Retirement" shall mean the termination of Executive's employment with
Company in accordance with the retirement policies, including early retirement
policies, generally applicable to Company's salaried employees.
(k) "Termination Date" shall mean the date specified in the Termination
Notice.
(l) "Termination Notice" shall mean a dated notice which: (i) indicates
the specific termination provision in this Agreement relied upon (if any); (ii)
sets forth in reasonable detail the facts and circumstances claimed to provide a
basis for the termination of Executive's employment under such provision; (iii)
specifies a Termination Date; and (iv) is given in the manner specified in
Section 15(h).
2. Employment. Company hereby employs Executive as Senior Vice President,
Research & Development and Director, Corporate Research Center and Executive
hereby agrees to continue such employment and agrees to render services to
Company in such capacity (or in such other capacity in the future as the Chief
Executive Officer may decide in his sole discretion) on the terms and conditions
set forth in this Agreement.
Executive's primary place of employment shall be at the Principal Executive
Office or other corporate location, as the Chief Executive Officer deems
appropriate.
3. Term.
(a) Term and Renewal of Agreement. Unless earlier terminated by
Executive or Company as provided in Section 10 hereof, the term of Executive's
employment under this Agreement shall be two (2) years, commencing on the date
of this Agreement and, subject to subsection 3(b), shall be deemed
automatically, without further action, to extend for an additional year on each
annual anniversary of the date of this Agreement.
(b) Annual Review. Prior to the second annual anniversary of the
date of this Agreement and each annual anniversary thereafter, the Board shall
consider extending the term of this Agreement. The term shall continue to
extend in the manner set forth in subsection 3(a) unless either the Board does
not approve the extension and provides written notice to Executive of such
event, or Executive gives written notice to Company Executive's election not to
extend the term. In either case, the written notice shall be given not fewer
than 30 days prior to any such anniversary date. References herein to the term
of this Agreement shall refer both to the initial term and successive terms.
4. Duties. Executive shall:
(a) Faithfully and diligently do and perform all such acts and
duties, and furnish such services as are assigned to Executive as of the date
this Agreement is signed, and (subject to Section 2) such additional or
different acts, duties and services as the Chief Executive Officer may assign in
the future; and
(b) devote his full professional time, energy, skill and best
efforts to the performance of his duties hereunder, in a manner that will
faithfully and diligently further the business and interests of Company, and
shall not be employed by or participate or engage in or in any manner be a part
of the management or operations of any business enterprise other than Company
without the prior written consent of the Board, which consent may be granted or
withheld in its sole discretion.
5. Compensation. Company shall compensate Executive for his services at a
minimum base salary of$198,000 per year ("Base Salary"), payable in periodic
installments in accordance with Company's regular payroll practices in effect
from time to time. Executive's Base Salary may be increased from time to time in
such amounts as may be determined by the Board, but may not be decreased
without Executive's express written consent (unless the decrease is pursuant to
a general compensation reduction applicable to all, or substantially all,
executive officers of Company). Bonus payments may be made as determined
appropriate by the Board in its sole discretion.
6. Benefit Plans. Executive shall be entitled to participate in and
receive benefits under any employee benefit plan or stock-based plan of Company,
and shall be eligible for any other plans and benefits covering executives of
Company, to the extent commensurate with his then duties and responsibilities
fixed by the Board. Company shall not make any change in such plans or benefits,
which would adversely affect Executive's rights thereunder, unless such change
affects all, or substantially all, executive officers of Company.
7. Vacation. Executive shall be entitled to pay annual vacation in
accordance with the policies established from time to time by the Board, which
shall in no event be fewer than three weeks per annum. Regardless of what the
Company's standard vacation policy may be, Executive shall not be entitled to
extra cash payments for any vacation he does not utilize.
8. Business Expenses. Company shall reimburse Executive or otherwise pay
for all reasonable expenses incurred by Executive in furtherance of or in
connection with the business of Company, including, but not limited to,
automobile and traveling expenses and all reasonable entertainment expenses,
subject to such reasonable documentation and other limitations as may be
established by the Board.
9. Disability. In the event Executive incurs a Disability, Executive's
obligation to perform services under this Agreement will terminate, and the
Board may terminate this Agreement upon written notice to Executive.
10. Termination
(a} Termination without Salary Continuation. In the event (i}
Executive terminates his employment hereunder other than for Good Reason, or
(ii} Executive's employment is terminated by Company due to his Retirement,
Disability or death, or for Cause, Executive shall have no right to compensation
or other benefits pursuant to this Agreement for any period after his last day
of active employment.
(b} Termination with Salary Continuation (No Change in Control}.
Except as provided in subsection 1O(c} in the event of a Change in Control, in
the event (i} Executive's employment is terminated by Company for a reason other
than Retirement, Disability, death or Cause, or (ii} Executive terminates his
employment for Good Reason, then Company shall:
(1) Pay Executive a severance amount equal to the greater of
(i} one times Executive's Base Salary as of his last day of active
employment, or (ii} the unpaid portion of Executive's Base Salary
for the remainder of the then current term of this Agreement; the
severance amount shall be paid in a single sum on the first business
day of the month following the Termination Date (unless Executive
elects, in writing and on, or not later than 30 days after, the date
this Agreement is executed, to receive the severance payment divided
into 24 equal monthly installments, paid beginning on the first
business day of the month following the Termination Date); and
(2) Maintain and provide to Executive, at no cost to
Executive, for a period ending at the earliest of (i) the expiration
of 12 months from Executive's last day of active employment; (ii)
the date of Executive's full-time employment by another employer; or
(iii) Executive's death, continued participation in all group
insurance, life insurance, health and accident, disability, and
other employee benefit plans in which Executive would have been
entitled to participate had his employment with Company continued
throughout such period, provided that such participation is not
prohibited by the terms of the plan or by Company for legal reasons.
(c) Termination with Salary Continuation (Change in Control}.
Notwithstanding anything to the contrary set forth in subsection 10(b), in the
event within six months of a Change in Control: (i) Executive terminates his
employment for Good Reason; or (ii) Executive's employment is terminated by
Company for a reason other than Retirement, Disability, death or Cause, then
Company shall:
(1) Pay Executive a severance amount equal to 2.99 times
Executive's Base Salary as of his last day of active Employment; the
severance amount shall be paid in a single sum on the first business
day of the month following the Termination Date (unless Executive
elects, in writing and on, or not later than 30 days after, the date
this Agreement is executed, to receive the severance payment divided
into 24 equal monthly installments, paid beginning on the first
business day of the month following the Termination Date); and
(2) Maintain and provide to Executive, at no cost to
Executive, for a period ending at the earliest of (i) the expiration
of 12 months from Executive's last day of active employment; (ii)
the date of Executive's full-time employment by another employer; or
(iii) Executive's death, continued participation in all group
insurance, life insurance, health and accident, disability, and
other employee benefit plans in which Executive would have been
entitled to participate had his employment with Company continued
throughout such period, provided that such participation is not
prohibited by the terms of the plan or by Company for legal
reasons.
(d) Termination Notice. Except in the event of Executive's death, a
termination under this Agreement shall be effected by means of a Termination
Notice.
11. Withholding. Company shall have the right to withhold from all
payments made pursuant to this Agreement any federal, state, or local taxes and
such other amounts as may be required by law to be withheld from such payments.
12. Assignability. Company may assign this Agreement and its rights and
obligations hereunder in whole, but not in part, to any entity to which Company
may transfer all or substantially all of its assets, if in any such case said
entity shall expressly in writing assume all obligations of Company hereunder as
fully as if it had been originally made a party hereto. Company may not
otherwise assign this Agreement or its rights and obligations hereunder. This
Agreement is personal to Executive and his rights and duties hereunder shall
not be assigned except as expressly agreed to in writing by Company.
13. Death of Executive. Any amounts due Executive under this Agreement
(not including any Base Salary not yet earned by Executive) unpaid as of the
date of Executive' s death shall be paid in a single sum as soon as practicable
after Executive's death to Executive's surviving spouse, or if none, to the duly
appointed personal representative of his estate.
14. Restrictive Covenants.
(a) Covenant Not to Compete. During the term of this Agreement and
for a period of one (1) year following the Termination Date, Executive shall not
directly or indirectly: (i) engage, anywhere within the geographical areas in
which Company is conducting business operations or providing services as of the
date of Executive's termination of employment, in the tissue engineering
business (the use of implantable absorbable materials, with or without a
bioactive component, to attempt to elicit a specific cellular response in order
to regenerate tissue or to impede the growth of tissue or migration of cells)
(the "Tissue Engineering Business" or the "Business") ; (ii) be or become a
stockholder, partner, owner, officer, director or employee or agent of, or a
consultant to or give financial or other assistance to, any person or entity
engaged primarily in the Business; (iii) seek in competition with the business
of Company to procure orders from or do business with any customer of Company;
(iv) solicit or contact with a view to the engagement or employment by any
person or entity of any person who is an employee of Company; (v) solicit (in
such a way as to adversely affect or interfere with the business of Company) any
person or entity who has been contracted with or engaged to manufacture,
assemble, supply or deliver products, goods, materials or services to Company;
or (vi) intentionally undertake to induce any of the customers, associates,
consultants, or employees of Company to take any action which might be
disadvantageous to Company; provided, however, that nothing herein shall
prohibit Executive and his affiliates from owning, as passive investors, in the
aggregate not more than 5% of the outstanding publicly traded stock of any
corporation so engaged.
(b) Confidentiality. Executive acknowledges a duty of
confidentiality owed to Company and shall not, at any time during or after his
employment by Company, retain in writing, use, divulge, furnish, or make
accessible to anyone, without the express authorization of the Board, any trade
secret, private or confidential information or knowledge of Company obtained or
acquired by him while so employed. All computer software, business cards,
telephone lists, customer lists, price lists, contract forms, catalogs, Company
books, records, files and know-how acquired while an employee of Company are
acknowledged to be the property of Company and shall not be duplicated, removed
from Company's possession or premises or made use of other than in pursuit of
Company's business or as may otherwise be required by law or any legal process,
or as is necessary in connection with any adversarial proceeding against Company
and, upon termination of employment for any reason, Executive shall deliver to
Company, without further demand, all copies thereof which are then in his
possession or under his control. No information shall be treated as
"confidential information" if it is generally available public knowledge at the
time of disclosure or use by Executive.
(c) Inventions and Improvements. Executive shall promptly communicate to
Company all ideas, discoveries and inventions which are or may be useful to
Company or its business. Executive acknowledges that all such ideas,
discoveries, inventions, and improvements which heretofore have been or are
hereafter made, conceived, or reduced to practice by him at any time during his
employment with Company heretofore or hereafter gained by him at any time during
his employment with Company are the property of Company, and Executive hereby
irrevocably assigns all such ideas, discoveries, inventions, and improvements to
Company for its sole use and benefit, without additional compensation. The
provisions of this Section 14(c) shall apply whether such ideas, discoveries,
inventions, or improvements were or are conceived, made or gained by him alone
or with others, whether during or after usual working hours, whether on or off
the job, whether applicable to matters directly or indirectly related to
Company's business interests (including potential business interests), and
whether or not within the specific realm of his duties. Executive shall, upon
request of Company, but at no expense to Executive, at any time during or after
his employment with Company, sign all instruments and documents reasonably
requested by Company and otherwise cooperate with Company to protect its right
to such ideas, discoveries, inventions, or improvements including applying for,
obtaining, and enforcing patents and copyrights thereon in such countries as
Company shall determine.
(d) Breach of Covenant. Any breach or violation of the provisions in this
Section 14 by Executive will result in forfeiture by Executive and all other
persons of all rights to any further payments or benefits under this Agreement,
and in such event Company shall have no further obligation to pay any amounts
related thereto. Executive expressly acknowledges that damages alone will be an
inadequate remedy for any breach or violation of any of the provisions of this
Section 14 and that Company, in addition to all other remedies, shall be
entitled as a matter of right to equitable relief, including injunctions and
specific performance, in any court of competent jurisdiction. If any of the
provisions of this Section 14 are held to be in any respect unenforceable, then
they shall be deemed to extend only over the maximum period of time, geographic
area, or range of activities as to which they may be enforceable.
15 .Miscellaneous
(a) Amendment. No provision of this Agreement may be amended unless such
amendment is signed by Executive and such officer as may be specifically
designated by the Board to sign on Company's behalf.
(b) Nature of Obligations. Nothing contained herein shall create or
require Company to create a trust of any kind to fund any benefits which may be
payable hereunder, and to the extent that Executive acquires a right to receive
benefits from Company hereunder, such right shall be no greater than the right
of any unsecured general creditor of Company.
(c) Prior Employment. Executive represents and warrants that his
acceptance of employment with Company has not breached, and the performance of
his duties hereunder will not breach, any duty owed by him to any prior employer
or other person.
(d) Headings. The Section headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. In the event of a conflict between. a heading
and the content of a Section, the content of the Section shall control.
(e) Gender and Number. Whenever used in this Agreement, a masculine
pronoun is deemed to include the feminine and a neuter pronoun is deemed to
include both the masculine and feminine, unless the context clearly indicates
otherwise. The singular form, whenever used herein, shall mean or include the
plural form where applicable.
(f) Severability .If any provision of this Agreement or the application
thereof to any person or circumstance shall be invalid or unenforceable under
any applicable law, such event shall not affect or render invalid or
unenforceable any other provision of this Agreement and shall not affect the
application of any provision to other persons or circumstances.
(g) Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the party's hereto and there respective successors, permitted
assigns, heirs, executors, and administrators.
(h) Notice. For purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given if hand-delivered, sent by documented overnight
delivery service or by certified or registered mail, return receipt requested,
postage prepaid, addressed to the respective addresses set forth below:
To the Company:
Integra LifeSciences Corporation
000 Xxxxxx Xxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attn: President
To the Executive:
Xx. Xxxxxxx Xxxxxxxxxxxxx
000 X. Xxxxxx Xxxxxx
Xxx Xxxxx, XX 00000
(i) Entire Agreement. This Agreement sets forth the entire understanding
of the parties and supersedes all prior agreements, arrangements and
communications, whether oral or written, pertaining to the subject matter
hereof.
(j) Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the United States
where applicable and otherwise by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been executed as of the date first
above written.
INTEGRA LIFESCIENCES CORPORATION
/s/ Xxxxxx Xxxxx
----------------
President
EXECUTIVE
/s/ Xxxxxxx X. Xxxxxxxxxxxxx
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