INTEGRA LIFESCIENCES HOLDINGS CORPORATION CONTRACT STOCK / RESTRICTED UNITS AGREEMENT Pursuant to 2003 EQUITY INCENTIVE PLAN
Exhibit 10.8
[Form for Xx. Xxxxx’x Annual RSU Grant]
INTEGRA LIFESCIENCES HOLDINGS CORPORATION
CONTRACT STOCK / RESTRICTED UNITS AGREEMENT
Pursuant to
2003 EQUITY INCENTIVE PLAN
CONTRACT STOCK / RESTRICTED UNITS AGREEMENT
Pursuant to
2003 EQUITY INCENTIVE PLAN
AGREEMENT, dated as of , 20___, by and between Integra LifeSciences Holdings
Corporation, a Delaware corporation (the “Company”), and Xxxxxx X. Xxxxx
(“Executive”).
WHEREAS, the Company and Executive previously entered into that certain Second Amended and
Restated Employment Agreement dated as of July 27, 2004, as amended by Amendment 2006-1 to the
Second Amended and Restated Employment Agreement and Amendment 2008-1 to the Second Amended and
Restated Employment Agreement;
WHEREAS, as of August 6, 2008, the Company and Executive have entered into an Amendment 2008-2
to the Second Amended and Restated Employment Agreement (such Second Amended and Restated
Employment Agreement, as so amended being hereinafter called the “Employment Agreement”),
pursuant to which Executive will continue to serve as President and Chief Executive Officer of the
Company, on the terms and conditions set forth and described therein;
WHEREAS, pursuant to the Employment Agreement, the Company has agreed to grant to Executive an
annual equity-based award under the Integra LifeSciences Holdings Corporation 2003 Equity Incentive
Plan (the “2003 Plan”), a copy of which is attached hereto; and
WHEREAS, the Compensation Committee of the Board of Directors of the Company, appointed to
administer the 2003 Plan, has determined that it would be to the advantage and in the best interest
of the Company and its stockholders to grant to the Executive an annual award for [INSERT YEAR] of
an aggregate of [ ] ( ) shares of contract stock in the form of restricted
units (the “Units”) representing an equal number of shares of restricted common stock of
the Company, par value $.01 per share (“Common Stock”), on the terms set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for other
good and valuable consideration the legal sufficiency of which is hereby acknowledged, the parties
hereto, intending to be legally bound hereby, agree as follows:
1. Definitions. Capitalized terms not otherwise defined herein shall have the
meaning set forth in the Employment Agreement or the 2003 Plan, as applicable, unless otherwise
indicated.
2. Grant of Units. Pursuant to Section 3.2(c)(i)(C) of the Employment Agreement,
Executive is hereby granted, as of , 20___(the “Grant Date”), deferred
compensation in the form of [ ] ( ) Units pursuant to the terms of this
Agreement and the 2003 Plan. The Executive’s right to receive the shares of Common Stock
underlying the Units shall be subject to forfeiture as provided in Section 4 of this Agreement.
3. Vesting.
(a) Subject to paragraph (b) and Section 4 below, the Units shall vest in cumulative
installments as follows:
(i) One-third (⅓) of the Units shall vest on the first anniversary of the Grant
Date;
(ii) One-third (⅓) of the Units shall vest on the second anniversary of the
Grant Date; and
(iii) One-third (⅓) of the Units shall vest on the third anniversary of the
Grant Date;
(b) One hundred percent (100%) of the then outstanding Units shall vest in the event that:
(i) Executive incurs a Termination of Service (as defined below) (1) by the
Company without “Cause” (as defined in Section 4.3 of the Employment Agreement), (2)
by the Executive for “Good Reason” (as defined in Section 4.4 of the Employment
Agreement), (3) by reason of a “Disability Termination” (as defined in Section 4.2
of the Employment Agreement), (4) by reason of the Executive’s death, (5) as a
result of the Employment Agreement (or the Executive’s successor employment
agreement with the Company, if any) not being amended, renewed or replaced by a new
employment agreement upon the expiration of such agreement on December 31, 2011 or
the Extended Expiration Date (as defined below), as applicable; or
(ii) a “Change in Control” (as defined in the Employment Agreement) that occurs
prior to the Executive’s Termination of Service.
(c) For purposes of this Agreement, (1) “Termination of Service” shall mean the time
when the Executive ceases to provide services to the Company and its Related Corporations and
Affiliates as an employee or Associate for any reason with or without cause, including, but not by
way of limitation, a termination by resignation, discharge, death, or disability. A Termination of
Service shall not include a termination where the Executive is simultaneously reemployed by, or
remains employed by, or continues to provide services to, the Company and/or one or more of its
Related Corporations and Affiliates or a successor entity thereto; and (2) “Extended Expiration
Date” shall mean, in the event that the Executive and the Company enter into (including by way
of an automatic extension) a new, amended or renewed employment agreement on or prior to December
31, 2011, the last day of the term of such new, amended or renewed employment agreement.
4. Forfeiture of Units. Immediately upon a Termination of Service for any reason,
the Executive shall forfeit any and all Units which have not vested or do not vest on or prior to
such termination, and the Executive’s rights in any such Units which are not so vested shall
terminate, lapse and expire (including the Executive’s right to receive the shares underlying such
Units).
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5. Dividend Equivalents. Executive shall be entitled to receive, with respect to all
outstanding vested Units (as such Units may be adjusted under Section 8), dividend equivalent
amounts equal to the regular quarterly cash dividend payable to holders of Common Stock (to the
extent regular quarterly cash dividends are paid) as if Executive were an actual shareholder with
respect to the number of shares of Common Stock equal to his outstanding vested Units. Such
dividend equivalent amounts shall be aggregated on a quarterly basis while the Units are
outstanding and paid to Executive within thirty (30) days following the first business day that
occurs immediately following the 6-month period after the date of Executive’s “separation from
service” from the Company (within the meaning of Section 409A(a)(2)(A)(i) of the Internal Revenue
Code of 1986, as amended (the “Code”) and its corresponding regulations) (a “Separation
from Service”). For the avoidance of doubt, such dividend equivalent amounts shall only be
paid with respect to Units that are vested as of the applicable dividend payment date, and
Executive shall not be entitled to receive any dividend equivalent amounts with respect to Units
that are not vested as of such dividend payment date. The dividend equivalents and any amounts
that may become payable in respect thereof shall be treated separately from the Units and the
rights arising in connection therewith for purposes of the designation of time and form of payments
required by Code Section 409A.
6. Payment of Units.
(a) The shares of Common Stock underlying Units which are then vested under Section 3(a) or
3(b) (the “Unit Shares”) shall be paid out to Executive within thirty (30) days following
the first business day that occurs immediately following the 6-month period after the date of
Executive’s Separation from Service.
(b) All payments of Unit Shares shall be made by the Company in the form of whole shares of
Common Stock, and any fractional share shall be distributed in cash in an amount equal to the value
of such fractional share determined based on the Fair Market Value (as defined in the 2003 Plan) as
of the date immediately prior to such distribution.
(c) Any Unit Shares delivered shall be deposited in an account designated by Executive and
maintained at a brokerage house selected by Executive. Any such Unit Shares shall be duly
authorized, fully paid and non-assessable shares, listed with NASDAQ or the principal United States
securities exchange on which the Common Stock is admitted to trading and registered on the Company
Registration Statement, if registration is requested by Executive.
(d) Except as otherwise provided in this Agreement, Executive shall not be deemed to be a
holder of any Common Stock pursuant to a Unit until the date of the issuance of a certificate to
him for such shares and, except as otherwise provided in this Agreement, Executive shall not have
any rights to dividends or any other rights of a shareholder with respect to the shares of Common
Stock covered by a Unit until such shares of Common Stock have been issued to him, which issuance
shall not be unreasonably delayed.
(e) The Company shall be entitled to withhold in cash or deduction from other compensation
payable to the Executive any sums required by federal, state or local tax law to be withheld with
respect to the vesting, distribution or payment of the Units or the Unit Shares. In satisfaction
of the foregoing requirement with respect to the distribution or payment of the Units, the Company
shall withhold shares of Common Stock otherwise issuable in such distribution having
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a Fair Market Value equal to the sums required to be withheld. Subject to the following sentence,
the number of shares of Common Stock which shall be so withheld in order to satisfy the Executive’s
federal, state and local withholding tax liabilities with respect to the issuance of shares of
Common Stock in payment of the Units shall be limited to the number of shares which have a Fair
Market Value on the date of withholding equal to the aggregate amount of such liabilities based on
the minimum statutory withholding rates for federal, state and local tax purposes that are
applicable to such supplemental taxable income. In the event that the number of shares of Common
Stock having a Fair Market Value equal to the sums required to be withheld is not a whole number of
shares, the number of shares so withheld shall be rounded up to the nearest whole share.
(f) Executive’s right to receive payment of any amounts under this Agreement shall be an
unfunded entitlement and shall be an unsecured claim against the general assets of the Company.
(g) After payment in accordance with this Section 6, the Unit Shares may not be sold,
transferred or otherwise disposed of by Executive for a period of five days after receipt of such
shares by Executive, except that no such restrictions shall apply in the case of a Change in
Control or in the event that Unit Shares are sold or withheld in order to satisfy any obligations
Executive may have with respect to any applicable tax withholding requirements on vesting or
receipt of Unit Shares (including, without limitation, pursuant to Section 6(e) above).
7. Representations. The Company represents and warrants that this Agreement has been
authorized by all necessary action of the Company, has been approved by the Board and is a valid
and binding agreement of the Company enforceable against it in accordance with its terms and that
the Unit Shares will be issued pursuant to and in accordance with the 2003 Plan, will be listed
with NASDAQ or the principal United States securities exchange on which the Common Stock is
admitted to trading, and will be validly issued, fully paid and non-assessable shares. The Company
further represents and warrants that the grant of Units under this Agreement has been approved by
the Company’s Compensation Committee, that the 2003 Plan has and will have sufficient shares
available to effect the distribution of the Unit Shares, and that the Company will file a Xxxx
Xxxxx Xxxxxx application with respect to Executive on a timely basis, if necessary, in connection
with the acquisition of Unit Shares by Executive under this Agreement.
8. Changes in the Common Stock and Adjustment of Units.
(a) In the event the outstanding shares of the Common Stock shall be changed into an increased
number of shares, through a share dividend or a split-up of shares, or into a decreased number of
shares, through a combination of shares, then immediately after the record date for such change,
the number of Units then subject to this Agreement shall be proportionately increased, in case of
such share dividend or split-up of shares, or proportionately decreased, in case of such
combination of shares. In the event the Company shall issue any of its shares of stock or other
securities or property (other than Common Stock which is covered by the preceding sentence), in a
reclassification of the Common Stock (including without limitation any such reclassification in
connection with a consolidation or merger in which the Company is the continuing entity), the kind
and number of Units subject to this Agreement immediately prior thereto shall be adjusted so that
the Executive shall be entitled to receive the same kind and number of shares or other securities
or property which the Executive would have owned or have
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been entitled to receive after the happening of any of the events described above, had he owned the
shares of the Common Stock represented by the Units under this Agreement immediately prior to the
happening of such event or any record date with respect thereto, which adjustment shall become
effective immediately after the effective date of such event retroactive to the record date, if
any, for such event.
(b) In the event the Company shall distribute to all holders of the Common Stock evidences of
its indebtedness or assets (including leveraged recapitalizations with special cash distributions,
but excluding regular quarterly cash dividends), then in each case the number of Units thereafter
subject to this Agreement shall be determined by multiplying the number of Units theretofore
subject to this Agreement by a fraction, (i) the numerator of which shall be the then current
market price per share of Common Stock (as determined in paragraph (c) below) on the record date
for such distribution, and (ii) the denominator of which shall be the then current market price per
share of the Common Stock less the then fair value (as mutually determined in good faith by the
Board and the Executive) of the portion of the assets or evidences of indebtedness so distributed
applicable to a share of Common Stock. Such adjustment shall be made whenever any such
distribution is made, and shall become effective on the date of distribution retroactive to the
record date for the determination of shareholders entitled to receive such distribution.
(c) For the purpose of any computation under paragraph (b) of this Section 8, the current
market price per share of the Common Stock at any date shall be deemed to be the average of the
daily Stock Prices (as defined herein) for 15 consecutive Trading Days (as defined herein)
commencing 20 Trading Days before the date of such computation. “Stock Price” for each
Trading Day shall be the “Fair Market Value” of the Common Stock (as defined in the 2003 Plan, as
in effect on the date of this Agreement) for such Trading Day. “Trading Day” shall be each
Monday, Tuesday, Wednesday, Thursday and Friday, other than any day on which the Common Stock is
not traded on the exchange or in the market which is the principal United States market for the
Common Stock.
(d) For the purpose of this Section 8, the term “Common Stock” shall mean (i) the
class of Company securities designated as the Common Stock at the date of this Agreement, or (ii)
any other class of equity interest resulting from successive changes or reclassifications of such
shares consisting solely of changes in par value, or from par value to no par value, or from no par
value to par value. In the event that at any time, as a result of an adjustment made pursuant to
the second sentence of Section 8(a) above, the Executive shall become entitled to Units
representing any shares other than the Common Stock, thereafter the number of such other shares
represented by a Unit shall be subject to adjustment from time to time in a manner and on the terms
as nearly equivalent as practicable to the provisions with respect to the shares contained in this
Section 8, and the provisions of this Agreement with respect to the shares of Common Stock
represented by the Units shall apply on like terms to any such other shares.
(e) In case of any Change in Control, consolidation of the Company, or merger of the Company
with another corporation as a result of which Common Stock is converted or modified, or in case of
any sale or conveyance to another corporation of the property, assets and business of the Company
as an entirety or substantially as an entirety, the Company shall modify the Units so as to provide
the Executive with Units reflecting the kind and amount of shares and other securities and property
(or cash, as applicable) that he would
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have owned or have been entitled to receive immediately after the happening of such Change in
Control, consolidation, merger, sale or conveyance had his Units immediately prior to such action
actually been shares and, if applicable, other securities of the Company represented by those
Units. The provisions of this Section 8(e) shall similarly apply to successive consolidations,
mergers, sales or conveyances.
(f) If the Company distributes rights or warrants to all holders of its Common Stock entitling
them to purchase shares of Common Stock at a price per share less than the current market price per
share on the record date for the distribution, the Company shall distribute to Executive equivalent
amounts of such rights or warrants as if Executive were an actual shareholder with respect to the
number of shares of Common Stock equal to his outstanding Units. Such rights or warrants shall be
exercisable at the same time, on the same terms and for the same price as the rights or warrants
distributed to holders of the Common Stock; provided, however, that if such rights or warrants are
deemed to be deferred compensation subject to the requirements of Section 409A of the Code, such
rights or warrants shall be distributed to Executive in a manner that complies with such
requirements.
(g) In case any event shall occur as to which the provisions of this Section 8 are not
applicable but the failure to make any adjustment would not fairly protect the rights represented
by the Units in accordance with the essential intent and principles of this Section 8 then, in each
such case, the Company shall make an adjustment, if any, on a basis consistent with the essential
intent and principles established in this Section 8, necessary to preserve, without dilution, the
rights represented by the Units. The Company will promptly notify the Executive of any such
proposed adjustment.
(h) Notwithstanding anything to the contrary contained herein, the provisions of Section 8
shall not apply to, and no adjustment is required to be made in respect of, any of the following:
(i) the issuance of shares of Common Stock upon the exercise of any other rights, options or
warrants that entitle the holder to subscribe for or purchase such shares (it being understood that
the sole adjustment pursuant to this Section 8 in respect of the issuance of shares of Common Stock
upon exercise of rights, options or warrants shall be made at the time of the issuance by the
Company of such rights, options or warrants, or a change in the terms thereof); (ii) the issuance
of shares of Common Stock to the Company’s employees, directors or consultants pursuant to bona
fide benefit plans adopted by the Company’s Board; (iii) the issuance of shares of Common Stock in
a bona fide public offering pursuant to a firm commitment offering; (iv) the issuance of shares of
Common Stock pursuant to any dividend reinvestment or similar plan adopted by the Company’s Board
to the extent that the applicable discount from the current market price for shares issued under
such plan does not exceed 5%; and (v) the issuance of shares of Common Stock in any arm’s length
transaction, directly or indirectly, to any party.
(i) Notwithstanding anything in this Agreement to the contrary, in the event of a spin-off by
the Company to its shareholders, Executive’s participation in such spin-off with respect to the
Units and the adjustment of the Units shall be determined in an appropriate and equitable manner,
and it is the intention of the parties hereto that, to the extent practicable, such adjustment
shall include an equity interest in the spin-off entity.
(j) In the event the parties hereto cannot agree upon an appropriate and equitable adjustment
to the Units, the services of an independent investment banker mutually
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acceptable to Executive and the Company shall (at the sole expense of the Company) be retained to
determine an appropriate and equitable adjustment, and such determination shall be binding upon the
parties.
(k) Each additional Unit which results from adjustments made pursuant to this Section 8 or the
2003 Plan shall be subject to the same terms and conditions regarding vesting and forfeiture as the
underlying Unit to which such additional Unit relates.
9. No Right to Employment. Nothing in this Agreement shall confer upon Executive the
right to remain in employ of the Company or any subsidiary of the Company.
10. Nontransferability. This Agreement shall not be assignable or transferable by
the Company (other than to successors of the Company) and this Agreement and the Units shall not be
assignable or transferable by the Executive otherwise than by will or by the laws of descent and
distribution, and the Units may be paid out during the lifetime of the Executive only to him. More
particularly, but without limiting the generality of the foregoing, the Units may not be assigned,
transferred (except as provided in the preceding sentence), pledged, or hypothecated in any way
(whether by operation of law or otherwise), and shall not be subject to execution, attachment or
similar process. Any attempted assignment, transfer, pledge, hypothecation or other disposition of
the Units contrary to the provisions of this Agreement, and any levy of any attachment or similar
process upon the Units, shall be null and void and without effect.
11. Arbitration, Legal Fees and Expenses. If any contest or dispute shall arise
between the Company and Executive regarding any provision of this Agreement, the Company shall
reimburse Executive for all legal fees and expenses reasonably incurred by Executive during his
lifetime in connection with such contest or dispute, pursuant to the provisions of Section 8.1 of
the Employment Agreement. The application of this Section 11 (and Section 8.1 of the Employment
Agreement) shall survive the termination of the Employment Agreement. The foregoing limitation
shall not preclude the Executive’s estate or heirs from recovering reasonable legal fees (and
related expenses) in accordance with the provisions hereof in the event that Executive’s estate or
heirs initiate or continue any dispute or controversy arising under or in connection with this
Agreement after Executive’s death; provided, however, that such reasonable legal fees (and related
expenses) are incurred within the six (6)-year period following the date of Executive’s death.
Such reimbursement shall be made within ninety (90) days following the resolution of such contest
or dispute (whether or not appealed), but not later than the end of the calendar year following the
year in which the contest or dispute is resolved, to the extent the Company receives reasonable
written evidence of such fees and expenses. The amount of any payment or reimbursement of such
fees or expenses in one year shall not affect the amount of payments or reimbursements that are
eligible for payment or reimbursement in any subsequent year, and the Executive’s right to such
payment or reimbursement of any such fees or expenses shall not be subject to liquidation or
exchange for any other benefit. Any dispute or controversy arising under or in connection with
this Agreement shall be settled exclusively by arbitration in Princeton, New Jersey in accordance
with the Commercial Arbitration Rules of the American Arbitration Association then in effect.
Judgment may be entered on the arbitrator’s award in any court having jurisdiction.
12. Entire Agreement. This Agreement and the Employment Agreement contain all the
understandings between the parties hereto pertaining to the matters referred to herein, and
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supersede all undertakings and agreements, whether oral or in writing, previously entered into by
them with respect thereto. The Executive represents that, in executing this Agreement, he does not
rely and has not relied upon any representation or statement not set forth herein made by the
Company with regard to the subject matter, basis or effect of this Agreement or otherwise.
13. Amendment or Modification; Waiver. No provision of this Agreement may be
amended, modified or waived unless such amendment or modification is agreed to in writing, signed
by the Executive and by a duly authorized officer of the Company, and such waiver is set forth in
writing and signed by the party to be charged. No waiver by any party hereto of any breach by
another party hereto of any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of a similar or dissimilar condition or provision at the same time,
any prior time or any subsequent time.
14. Notices. Any notice to be given hereunder shall be in writing and shall be
deemed given when delivered personally, sent by courier or telecopy or registered or certified
mail, postage prepaid, return receipt requested, addressed to the party concerned at the address
indicated below or to such other address as such party may subsequently give notice of hereunder in
writing:
To the Executive:
Xxxxxx X. Xxxxx
000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Facsimile: 000-000-0000
000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Facsimile: 000-000-0000
To the Company:
Integra LifeSciences Holdings Corporation
000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Chairman
Facsimile: 000-000-0000
000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Chairman
Facsimile: 000-000-0000
(with a copy to the Company’s General Counsel)
Any notice delivered personally or by courier under this Section 14 shall be deemed given on
the date delivered and any notice sent by telecopy or registered or certified mail, postage
prepaid, return receipt requested, shall be deemed given on the date telecopied or mailed.
15. Severability. If any provision of this Agreement or the application of any such
provision to any party or circumstances shall be determined by any court of competent jurisdiction
to be invalid and unenforceable to any extent, the remainder of this Agreement or the application
of such provision to such person or circumstances, other than those to which it is so determined to
be invalid and unenforceable, shall not be affected thereby, and each provision hereof shall be
validated and shall be enforced to the fullest extent permitted by law.
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16. Noncontravention. The Company represents that the Company is not prevented from
entering into, or performing, this Agreement by the terms of any law, order, rule or regulation,
its certificate of incorporation or by-laws, or any agreement to which it is a party.
17. Survivorship. The respective rights and obligations of the parties hereunder
shall survive any termination of this Agreement or Executive’s employment to the extent necessary
for the intended preservation of such rights and obligations.
18. Successors. This Agreement shall inure to the benefit of and be binding upon
each successor of the Company, and upon the Executive’s beneficiaries, legal representatives or
estate, as the case may be.
19. Construction. Except as would be in conflict with any specific provision herein,
this Agreement is made under and subject to the provisions of the 2003 Plan as in effect on the
Grant Date and, except as would conflict with the provisions of this Agreement, all of the
provisions of the 2003 Plan as in effect on the Grant Date are hereby incorporated herein as
provisions of this Agreement. In the event of any such conflict, the terms of this Agreement shall
govern.
20. Governing Law. This agreement will be governed by and construed in accordance
with the laws of the State of Delaware, without regard to its conflicts of laws principles.
21. Headings. All descriptive headings of sections and paragraphs in this Agreement
are for convenience of reference only, and they form no part of this Agreement and shall not affect
its interpretation.
22. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and the same
instrument.
23. Section 409A of the Code. This Agreement is intended to comply with the
requirements of Section 409A of the Code, and shall in all respects be administered in accordance
with Section 409A. Notwithstanding anything in the Agreement to the contrary, payment may only be
made under the Agreement upon an event and in a manner permitted by Section 409A of the Code. If a
payment is not made by the designated payment date under the Agreement, the payment shall be made
by December 31 of the calendar year in which the designated date occurs. Any payment to be made
upon a termination of employment under this Agreement may only be made upon a Separation from
Service. To the extent that any provision of the Agreement would cause a conflict with the
requirements of Section 409A of the Code, or would cause the administration of the Agreement to
fail to satisfy the requirements of Section 409A, such provision shall be deemed null and void to
the extent permitted by applicable law.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Contract Stock / Restricted Units
Agreement as of the date first above written.
| INTEGRA LIFESCIENCES HOLDINGS CORPORATION | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| EXECUTIVE | ||||||
| Xxxxxx X. Xxxxx | ||||||
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