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AMENDMENT 2006-1
TO THE
SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT
AMENDMENT, dated as of December 19, 2006, between Integra LifeSciences
Holdings Corporation, a Delaware corporation (the "Company") and Xxxxxx X. Xxxxx
(the "Executive").
RECITALS
WHEREAS, the Company and Executive previously entered into the Second
Amended and Restated Employment Agreement, dated as of July 27, 2004, (the
"Employment Agreement"), that sets forth the terms and conditions of Executive's
employment with the Company, including, but not limited to, severance benefits
that will be payable to Executive if he experiences a covered termination;
WHEREAS, the Company and Executive desire to amend the Employment
Agreement to provide certain severance benefits to Executive in the event
Executive's employment is terminated by the Company for a covered termination in
connection with a Change in Control (as defined in the Employment Agreement);
and
WHEREAS, Section 8.6 of the Employment Agreement provides that the
Employment Agreement may be amended pursuant to a written agreement between
Executive and the Company.
NOW, THEREFORE, the Company and Executive hereby agree that, effective
December 19, 2006, the Employment Agreement shall be amended as follows:
1. The heading of Section 4.4 of the Employment Agreement is
hereby amended in its entirety to read as follows:
"4.4 Termination without Cause or by Executive for Good Reason
Unrelated to a Change in Control."
2. The first sentence of Section 4.4(a) of the Employment
Agreement shall be amended in its entirety to read as follows:
"Except as provided in Section 6.2 in the event of a Change in
Control (as defined in Section 6.1), if (i) Executive's
employment is terminated by the Company for any reason other
than Cause or the death or Disability Termination of
Executive, or (ii) Executive's employment is terminated by
Executive for Good Reason (as defined herein), then (A) the
Company shall pay to Executive a lump sum cash payment equal
to the sum of (x) the Accrued Obligations and (y) his Base
Salary (including the minimum increases provided therein)
during the remainder of the then-current Term, (B) all Stock
Options granted to Executive shall become immediately vested
(to the extent not already vested) on the date of such
termination and shall be exercisable through their original
expiration dates, and (C) all Additional Unit Shares shall be
delivered to Executive as provided in his Restricted Units
Agreement, as amended."
3. Section 4.4(b) of the Employment Agreement is hereby amended
by adding the following paragraph at the end thereof:
"Notwithstanding anything contained herein to the contrary,
"Good Reason" shall also mean if, following a Change in
Control, Executive is not the Chief Executive Officer of the
ultimate parent entity which directly or indirectly, through
one or more subsidiaries, controls, through equity ownership,
board representation or otherwise, the operation of the
business that was conducted by the Company prior to the Change
in Control, it being understood that the ultimate parent
entity following a Change in Control is the top tier entity in
the chain of entities directly or indirectly controlling the
operation of the Company's business following a Change in
Control and such entity may be the Company, an acquiring or
successor entity or an affiliate of an acquiring or successor
entity. No notice requirement or remedial period is applicable
if Executive elects to terminate his employment on account of
a Good Reason termination pursuant to the immediately
preceding sentence following a Change in Control; provided,
however, that this paragraph shall only be effective for the
eighteen (18) month period following a Change in Control."
4. Section 4.5 of the Employment Agreement is hereby amended in
its entirety to read as follows:
"4.5 Failure to Extend. Except as otherwise provided in
Section 6.2 below, in the event that Executive's employment
with the Company terminates due to a failure by either party
to extend this Agreement pursuant to Section 2.1, the Company
shall not thereafter be obligated to make any further payments
hereunder other than Accrued Obligations and Executive shall
be eligible to elect COBRA continuation coverage, at his
expense, with respect to any Health Benefits COBRA
continuation coverage is legally required to be offered to
Executive. In the event that Executive's employment with the
Company terminates upon expiration of the Term because the
Company provides Executive with notice of termination pursuant
to Section 2.1, then, in addition to the foregoing, each
Additional Company Stock Option outstanding as of such date
shall fully vest (to the extent not already vested) and shall
remain exercisable until the expiration date of such
Additional Company Stock Option (e.g., 10 years after the
grant date or such lesser time as is specified in the
Additional Company Stock Option grant)."
5. Current Section 6.2 of the Employment Agreement, and all references
to current Section 6.2 of the Employment Agreement, are hereby renumbered as
Section 6.3, and a new Section 6.2 is hereby added to the Employment Agreement
to read as follows:
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"6.2 Termination without Cause or by Executive for Good Reason
Related to a Change in Control. Notwithstanding anything to
the contrary set forth in Section 4.4(a) above, and subject to
Executive and the Company executing a mutual release that is
mutually agreeable (provided, however, that Executive shall
not be required to execute such mutual release as a condition
to the receipt of the payments and benefits described below
unless the Company also executes such mutual release), in the
event that within 18 months following a Change in Control: (i)
the Company fails to extend this Agreement pursuant to Section
2.1, (ii) Executive terminates his employment for Good Reason
or (iii) Executive's employment is terminated by the Company
for a reason other than death, Disability Termination or
Cause, then the Company shall:
(a) pay Executive an amount equal to the Accrued
Obligations, excluding any bonus accruals;
(b) pay Executive a severance amount equal to the sum
of (i) 2.99 times the amount that results from adding
Executive's Base Salary (determined prior to any reduction
that would provide Executive with the right to terminate his
employment on account of Good Reason) as of his last day of
active employment to the target bonus that Executive was
eligible to receive in the fiscal year of his termination of
employment, and (ii) a pro ration of the target bonus that
Executive was eligible to receive in the fiscal year of his
termination of employment, with such pro ration determined by
multiplying such target bonus amount by a fraction, the
numerator of which is the number of days during which
Executive was employed by the Company in the fiscal year of
his termination and the denominator of which is 365; except as
provided below, the severance amount shall be paid in a single
sum on the first business day of the month following the Date
of Termination (or, if later, the first business day of the
month following the date on which Executive may revoke the
mutual release);
(c) maintain and provide to Executive, at no cost to
Executive, for a period ending on the later of (i) the end of
the Term of the Agreement or (ii) one year following
Executive's Date of Termination, continued participation in
the Health Benefits and life insurance programs in which
Executive, his spouse and his eligible dependents were
participating immediately prior to the date of such
termination at the level in effect and upon substantially the
same terms and conditions (including without limitation
contributions required by Executive for such benefits) as
existed immediately prior to the date of termination;
provided, that if Executive, his spouse or his eligible
dependents cannot continue to participate in the Company
programs providing such benefits, the Company shall pay or
reimburse the premiums for a health care program for
Executive, his spouse and his eligible dependents that is
substantially equivalent to the then-current Health Benefits;
but further provided, that such Health Benefits shall
terminate upon the date or dates Executive receives equivalent
coverage and benefits that do not include waiting period or
pre-existing condition limitations, under the plans and
programs of a subsequent employer (such coverage and benefits
to be determined on a coverage-by-coverage or
benefit-by-benefit basis). If such coverage is provided under
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the Company programs, then upon termination of such coverage,
Executive and his dependents shall be afforded Health Benefits
continuation rights in accordance with COBRA; and
(d) pay to Executive all reasonable legal fees and
expenses incurred by Executive as a result of such termination
of employment (including all legal fees and expenses, if any,
incurred by Executive in contesting or disputing any such
termination or in seeking to obtain or enforce any right or
benefit provided to Executive by this Agreement whether by
arbitration or otherwise).
Notwithstanding anything in the foregoing to the contrary, if
any of the foregoing severance amounts are deemed as deferred
compensation subject to the requirements of section 409A of
the Internal Revenue Code of 1986, as amended (the "Code"),
the Company shall pay such severance amounts in accordance
with the requirements of section 409A of the Code, which may
include, among other requirements, deferring the payment of
the severance benefits to a date that is no sooner than then
after the six month period following Executive's Date of
Termination; provided, however, that if such payment is
delayed it shall be paid as soon as administratively
practicable following the expiration of such six month period,
but not later then the first Company payroll date that occurs
after the end of such six month period. If any of the
severance payments are deferred due to such requirements,
there shall be added to such payments interest during the
deferral period at a rate, per annum, equal to the applicable
federal short-term rate (compounded monthly) in effect under
Section 1274(d) of the Code on the Executive's Date of
Termination."
6. In all respects not modified by this Amendment 2006-1, the
Employment Agreement is hereby ratified and confirmed.
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IN WITNESS WHEREOF, the Company and Executive agree to the terms of the
foregoing Amendment 2006-1, effective as of the date set forth above.
INTEGRA LIFESCIENCES
HOLDINGS CORPORATION
By:/s/ Xxxxxxx X. Xxxxxx
---------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chairman
EXECUTIVE
/s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
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