Exhibit 10.1
CRDENTIA CORP.
EXECUTIVE EMPLOYMENT AGREEMENT
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This Executive Employment Agreement (the "AGREEMENT"), dated March 22,
2004 (the "EFFECTIVE DATE"), is between Crdentia Corp., a Delaware corporation
(the "COMPANY") and Xxxxxxx X. Xxxxxxxx, an individual residing at 000 Xxxxxxx
Xxxx, Xx Xxxx, Xxxxx 00000 ("EXECUTIVE").
1. POSITION AND RESPONSIBILITIES
a. POSITION. Executive is employed by the Company to render services to
the Company in the position of Chief Financial Officer and Secretary. Executive
shall perform such duties and responsibilities as are normally related to such
position in accordance with the standards of the industry and any additional
duties now or hereafter assigned to Executive by the Company. To the extent not
inconsistent with the express terms of this Agreement, Executive shall abide by
the rules, regulations, and practices for the Company's senior management as
adopted or modified from time to time in the Company's sole discretion.
b. OTHER ACTIVITIES. Except upon the prior written consent of the
Company, Executive will not, during the term of this Agreement, (i) accept any
other employment, or (ii) engage, directly or indirectly, in any other business
activity (whether or not pursued for pecuniary advantage) that interferes with
Executive's duties and responsibilities hereunder or create a conflict of
interest with the Company.
c. NO CONFLICT. Executive represents and warrants that Executive's
execution of this Agreement, Executive's employment with the Company, and the
performance of Executive's proposed duties under this Agreement shall not
violate any obligations Executive may have to any other employer, person or
entity, including any obligations with respect to proprietary or confidential
information of any other person or entity.
2. COMPENSATION AND BENEFITS
a. BASE SALARY. In consideration of the services to be rendered under
this Agreement, the Company shall pay Executive a salary at the rate of One
Hundred Seventy Five Thousand Dollars ($175,000) per year ("BASE SALARY"). The
Base Salary shall be paid in accordance with the Company's regularly established
payroll practice. Executive's Base Salary will be reviewed from time to time in
accordance with the established procedures of the Company for adjusting salaries
for similarly situated employees and may be adjusted in the sole discretion of
the Company; provided, however, that the Company may not reduce Executive's Base
Salary unless the base salaries of all executive employees holding the position
of vice president or above are reduced by the same percentage as Executive's
Base Salary.
b. STOCK OPTION(S). In consideration of the services to be rendered
hereunder, upon the requisite approval of the Company's board of directors,
Executive shall be entitled to receive an option to purchase up to 331,512
shares of the Company's common stock ("Common Stock") at an exercise price per
share equal to the then current fair market value as determined by the board of
directors. Such option shall be evidenced by, and subject to the terms and
conditions set forth in, the form of Stock Option Agreement which is attached
hereto as Exhibit A (the "STOCK OPTION AGREEMENT").
c. BENEFITS. Executive shall be eligible to participate in the benefits
made generally available by the Company to similarly-situated Executives, in
accordance with the benefit plans established by the Company, and as may be
amended from time to time in the Company's sole discretion.
d. BONUS PROGRAM. Executive shall be eligible to participate in the
Bonus Program made generally available to the Company's Executives ("BONUS
PROGRAM"), such participation to be at a level consistent with
similarly-situated Executives and in accordance with the terms of the Bonus
Program established by the Company, and as may be amended from time to time in
the Company's sole discretion.
e. EXPENSES. The Company shall reimburse Executive for reasonable
business expenses incurred in the performance of Executive's duties hereunder in
accordance with the Company's expense reimbursement guidelines.
3. AT-WILL EMPLOYMENT; TERMINATION BY COMPANY
a. AT-WILL TERMINATION BY COMPANY. The employment of Executive shall be
"at-will" at all times. The Company may terminate Executive's employment with
the Company at any time, without any advance notice, for any reason or no reason
at all, notwithstanding anything to the contrary contained in or arising from
any statements, policies or practices of the Company relating to the employment,
discipline or termination of its employees. Upon and after such termination by
the Company, all obligations of the Company under this Agreement shall cease,
unless Executive's employment is terminated without Cause, in which case the
Company shall provide Executive with the severance benefits described in Section
3(b) below.
x. XXXXXXXXX. Except in situations where the employment of Executive is
terminated For Cause or By Disability (as defined in Section 4 below), in the
event that the Company terminates the employment of Executive at any time, or
upon Executive's death, Executive will be eligible to receive an amount, payable
in a lump sum, equal to (i) one (1) month of Base Salary of the Executive plus
(ii) two (2) weeks of Base Salary of the Executive for each full month of
employment in excess of six (6) months of employment beginning on the Effective
Date, up to an aggregate maximum of amount (with respect to subsections (i) and
(ii)) of twelve (12) months of Base Salary. For purposes of such calculation,
"Base Salary" shall refer to the greater of (i) $175,000 per year or (ii)
Executive's then current base salary on the termination date (plus the amount of
any cash bonus received by Executive for the prior year, if any). Executive's
eligibility for severance is conditioned on Executive having first signed a
release agreement in the form attached as Exhibit B. Executive shall not be
entitled to any severance payments if Executive's employment is terminated For
Cause, By Death or By Disability (as defined in Section 4 below) or if
Executive's employment is terminated by Executive without Good Reason (in
accordance with Section 5 below).
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4. OTHER TERMINATIONS BY COMPANY
a. TERMINATION FOR CAUSE. For purposes of this Agreement, "For Cause"
shall mean: (i) Executive is indicted for or charged with a crime involving
dishonesty, breach of trust, or physical harm to any person (provided, however,
that the foregoing shall not include any misdemeanor resulting from harm caused
by Executive to another person through the operation of a motor vehicle); (ii)
Executive willfully engages in conduct that is in bad faith and materially
injurious to the Company, including but not limited to, misappropriation of
trade secrets, fraud or embezzlement; (iii) Executive commits a material breach
of this Agreement, which breach (if curable) is not cured within thirty days
after written notice to Executive from the Company; (iv) Executive willfully
refuses to implement or follow a lawful policy or directive of the Company that
is consistent with the terms of this Agreement, which breach is not cured within
sixty (60) days after written notice to Executive from the Company; or (v)
Executive engages in misfeasance or malfeasance demonstrated by a pattern of
failure to perform job duties diligently and professionally, which failure (if
curable) is not cured within sixty (60) days after written notice to Executive
from the Company. Except for the notices required above, the Company may
terminate Executive's employment For Cause at any time, without any advance
notice. The Company shall pay to Executive all compensation to which Executive
is entitled up through the date of termination, subject to any other rights or
remedies of the Company under law; and thereafter all obligations of the Company
under this Agreement shall cease.
b. BY DEATH. Executive's employment shall terminate automatically upon
Executive's death. The Company shall pay to Executive's beneficiaries or estate,
as appropriate, any compensation then due and owing. Thereafter all obligations
of the Company under this Agreement shall cease. Nothing in this Section shall
affect any entitlement of Executive's heirs or devisees to the benefits of any
life insurance plan or other applicable benefits.
c. BY DISABILITY. If Executive becomes eligible for the Company's long
term disability benefits or if, in the sole opinion of a qualified medical
doctor in Executive's municipality of residence selected by the Company but
otherwise not affiliated with the Company or its senior management, Executive is
unable to carry out the responsibilities and functions of the position held by
Executive by reason of any physical or mental impairment for more than ninety
(90) consecutive days or more than one hundred and twenty (120) days in any
twelve-month period, then, to the extent permitted by law, the Company may
terminate Executive's employment. The Company shall pay to Executive all
compensation to which Executive is entitled through the date of termination, and
thereafter all obligations of the Company under this Agreement shall cease.
Nothing in this Section shall affect Executive's rights under any disability
plan in which Executive is a participant.
5. TERMINATION BY EXECUTIVE
a. AT-WILL TERMINATION BY EXECUTIVE. Executive may terminate employment
with the Company at any time for any reason or no reason at all, upon ninety
(90) days' advance written notice. During such notice period Executive shall
continue to diligently perform all of Executive's duties hereunder. The Company
shall have the option, in its sole discretion, to make Executive's termination
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effective at any time prior to the end of such notice period as long as the
Company pays Executive all compensation to which Executive is entitled up
through the last day of the ninety (90) day notice period. Thereafter all
obligations of the Company shall cease.
b. TERMINATION FOR GOOD REASON. Executive's termination shall be for
"Good Reason" if Executive provides written notice to the Company of the Good
Reason within thirty (30) days of the event constituting Good Reason and
provides the Company with a period of thirty (30) days to cure the event
constituting Good Reason and the Company fails to cure the Good Reason within
that period. For purposes of this Agreement, "Good Reason" shall mean any of the
following events, if such event is effected by the Company without the consent
of Executive: (i) a change in Executive's position with the Company which
materially reduces Executive's level of responsibility; (ii) a reduction in
Executive's Base Salary, except for reductions in accordance with Section 2(a)
hereof; (iii) a relocation of Executive's principal place of employment by more
than fifty (50) miles (excluding any relocation to Dallas, Texas); or (iv) a
material breach of this Agreement by the Company. In such event Executive may
terminate his employment for Good Reason, in which case Executive will be
eligible to receive an amount, payable in the form of a lump sum, equal to (i)
one (1) month of Base Salary of the Executive plus (ii) two (2) weeks of Base
Salary of the Executive for each full month of employment in excess of six (6)
months of employment beginning on the Effective Date, up to an aggregate maximum
of amount (with respect to subsections (i) and (ii)) of twelve (12) months of
Base Salary. For purposes of such calculation, "Base Salary" shall refer to the
greater of (i) $175,000 per year or (ii) Executive's Base Salary on the
termination date (plus the amount of any cash bonus received by Executive for
the prior year, if any). Executive's eligibility for severance is conditioned on
Executive having first signed a release agreement in the form attached as
Exhibit B. Thereafter all obligations of the Company or its successor under this
Agreement shall cease.
6. TERMINATION OBLIGATIONS
a. RETURN OF PROPERTY. Executive agrees that all property (including,
without limitation, all equipment, tangible proprietary information, documents,
records, notes, contracts and computer-generated materials) furnished to or
created or prepared by Executive incident to Executive's employment belongs to
the Company and shall be promptly returned to the Company upon termination of
Executive's employment.
b. RESIGNATION AND COOPERATION. Upon termination of Executive's
employment, Executive shall be deemed to have resigned from all offices and
directorships then held with the Company. Following any termination of
employment, subject to Executive's receiving reasonable and customary
compensation, Executive shall cooperate with the Company in the winding up of
pending work on behalf of the Company and the orderly transfer of work to other
employees. Executive shall also cooperate with the Company, at the Company's
expense, in the defense of any action brought by any third party against the
Company that relates to Executive's employment by the Company.
c. CONTINUING OBLIGATIONS. Executive understands and agrees that
Executive's obligations under Sections 6, 7, and 8 herein (including Exhibits C
and D) shall survive the termination of Executive's employment for any reason
and the termination of this Agreement.
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7. INVENTIONS AND PROPRIETARY INFORMATION; NON COMPETITION; PROHIBITION ON THIRD
PARTY INFORMATION
a. PROPRIETARY INFORMATION AGREEMENT. Executive agrees to sign and be
bound by the terms of the Proprietary Information and Inventions Agreement,
which is attached as Exhibit C ("PROPRIETARY INFORMATION AGREEMENT").
b. NON-COMPETITION. As an inducement for the Company's entering into
this Agreement and in consideration of the Company's agreement to furnish
Executive with certain confidential and proprietary information regarding the
Company pursuant to Exhibit C, Executive covenants that commencing on the
Effective Date and for a period ending eighteen (18) months following the
termination of Executive's employment with the Company (the "TERM"), Executive
shall not, directly or indirectly, manage, engage in, operate or conduct,
prepare to or plan to conduct or assist any person or entity to conduct any
business, or have any controlling interest in any business, person, firm,
corporation or other entity (as a principal, owner, agent, employee,
shareholder, officer, director, joint venturer, partner, member, security
holder, creditor, consultant or in any other capacity) whose revenue is
generated principally from a business which is competitive with the Business
anywhere in the United States (the "TERRITORY"). As used herein, the term
"Business" shall refer to the business of the company and its subsidiaries of
operating a temporary nurse staffing company, including, without limitation, the
provision of travel and per diem temporary nurse staffing services. The
covenants set forth in this Section 7(b) shall be construed as a series of
separate covenants covering their subject matter in each of the separate states
within the Territory, and except for geographic coverage, each such separate
covenant shall be deemed identical in terms to the covenant set forth above in
this Section 7(b). To the extent that any such covenant shall be judicially
unenforceable in any one or more states in the United States, such covenant
shall not be affected with respect to each of such other states in the
Territory. Each covenant with respect to such state in the Territory shall be
construed as severable and independent.
c. NON-SOLICITATION; NON-DISPARAGEMENT. Executive acknowledges that
because of Executive's position in the Company, Executive will have access to
material intellectual property and confidential information. During the Term (as
previously defined), in addition to Executive's other obligations hereunder or
under the Proprietary Information Agreement, Executive shall not, for Executive
or any third party, directly or indirectly (a) divert or attempt to divert from
the Company or its subsidiaries any business of any kind, including without
limitation the solicitation of or interference with any of its customers,
clients, members, business partners or suppliers, or (b) solicit or otherwise
induce any person engaged by the Company or any of its subsidiaries (as an
agent, employee, consultant, or in any other capacity) to terminate his or her
employment, consultancy or other relationship with the Company or its
subsidiaries. In addition, Executive will not disparage the Company or any of
its stockholders, directors, employees or agents (collectively the "COMPANY
REPRESENTATIVES"), and neither the Company nor the Company Representatives will
disparage Executive.
d. NON-DISCLOSURE OF THIRD PARTY INFORMATION. Executive represents and
warrants and covenants that Executive shall not disclose to the Company, or use,
or induce the Company to use, any proprietary information or trade secrets of
others at any time, including but not limited to any proprietary information or
trade secrets of any former employer, if any; and Executive acknowledges and
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agrees that any violation of this provision shall be grounds for Executive's
immediate termination and could subject Executive to substantial civil
liabilities and criminal penalties. Executive further specifically and expressly
acknowledges that no officer or other employee or representative of the Company
has requested or instructed Executive to disclose or use any such third party
proprietary information or trade secrets.
e. REASONABLENESS OF RESTRICTIONS. EXECUTIVE HAS CAREFULLY READ AND
CONSIDERED THE PROVISIONS OF SECTION 7 HEREOF AND, HAVING DONE SO, HEREBY AGREES
THAT THE RESTRICTIONS SET FORTH IN SUCH SECTIONS ARE FAIR AND REASONABLE AND ARE
REASONABLY REQUIRED FOR THE PROTECTION OF THE INTERESTS OF THE COMPANY AND ITS
ASSETS AND PROPERTIES, INCLUDING, WITHOUT LIMITATION, THE BUSINESS. IF ANY
COVENANT IN SECTION 7 IS HELD TO BE UNREASONABLE, ARBITRARY, OR AGAINST PUBLIC
POLICY, SUCH COVENANT WILL BE CONSIDERED TO BE DIVISIBLE WITH RESPECT TO SCOPE,
TIME, AND GEOGRAPHIC AREA, AND SUCH LESSER SCOPE, TIME, OR GEOGRAPHIC AREA, OR
ALL OF THEM, AS A COURT OF COMPETENT JURISDICTION MAY DETERMINE TO BE
REASONABLE, NOT ARBITRARY, AND NOT AGAINST PUBLIC POLICY, WILL BE EFFECTIVE,
BINDING AND ENFORCEABLE AGAINST THE EXECUTIVE.
8. ARBITRATION
Executive agrees to sign and be bound by the terms of the Arbitration
Agreement, which is attached as Exhibit D.
9. AMENDMENTS; WAIVERS; REMEDIES
This Agreement may not be amended or waived except by a writing signed
by Executive and by a duly authorized representative of the Company other than
Executive. Failure to exercise any right under this Agreement shall not
constitute a waiver of such right. Any waiver of any breach of this Agreement
shall not operate as a waiver of any subsequent breaches. All rights or remedies
specified for a party herein shall be cumulative and in addition to all other
rights and remedies of the party hereunder or under applicable law.
10. ASSIGNMENT; BINDING EFFECT
a. ASSIGNMENT. The performance of Executive is personal hereunder, and
Executive agrees that Executive shall have no right to assign and shall not
assign or purport to assign any rights or obligations under this Agreement. This
Agreement may be assigned or transferred by the Company; and nothing in this
Agreement shall prevent the consolidation, merger or sale of the Company or a
sale of any or all or substantially all of its assets.
b. BINDING EFFECT. Subject to the foregoing restriction on assignment
by Executive, this Agreement shall inure to the benefit of and be binding upon
each of the parties; the affiliates, officers, directors, agents, successors and
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assigns of the Company; and the heirs, devisees, spouses, legal representatives
and successors of Executive.
11. NOTICES
All notices or other communications required or permitted hereunder
shall be made in writing and shall be deemed to have been duly given if
delivered: (a) by hand; (b) by a nationally recognized overnight courier
service; or (c) by United States first class registered or certified mail,
return receipt requested, to the principal address of the other party, as set
forth below. The date of notice shall be deemed to be the earlier of (i) actual
receipt of notice by any permitted means, or (ii) five business days following
dispatch by overnight delivery service or the United States Mail. Executive
shall be notify the Company in writing of any change in Executive's address.
Notice of change of address shall be effective only when done in accordance with
this paragraph.
Company's Notice Address:
00000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Chief Executive Officer
Executive's Notice Address:
000 Xxxxxxx Xxxx
Xx Xxxx, Xxxxx 00000
12. SEVERABILITY
If any provision of this Agreement shall be held by a court or
arbitrator to be invalid, unenforceable, or void, such provision shall be
enforced to the fullest extent permitted by law, and the remainder of this
Agreement shall remain in full force and effect. In the event that the time
period or scope of any provision is declared by a court or arbitrator of
competent jurisdiction to exceed the maximum time period or scope that such
court or arbitrator deems enforceable, then such court or arbitrator shall
reduce the time period or scope to the maximum time period or scope permitted by
law.
13. TAXES
All amounts payable to Executive under this Agreement (including,
without limitation, Executive's Base Salary and any bonuses and severance pay)
shall be paid less all applicable state and federal tax withholdings and any
other withholdings required by any applicable jurisdiction.
14. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the laws of the State of Texas.
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15. INTERPRETATION
This Agreement shall be construed as a whole, according to its fair
meaning, and not in favor of or against any party. Sections and section headings
contained in this Agreement are for reference purposes only, and shall not
affect in any manner the meaning or interpretation of this Agreement. Whenever
the context requires, references to the singular shall include the plural and
the plural the singular.
16. COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original of this Agreement, but all of which together
shall constitute one and the same instrument.
17. AUTHORITY
Each party represents and warrants that such party has the right, power
and authority to enter into and execute this Agreement and to perform and
discharge all of the obligations hereunder; and that this Agreement constitutes
the valid and legally binding agreement and obligation of such party and is
enforceable in accordance with its terms.
18. ENTIRE AGREEMENT
This Agreement is intended to be the final, complete, and exclusive
statement of the terms of Executive's employment by the Company and may not be
contradicted by evidence of any prior or contemporaneous statements or
agreements, except for agreements specifically referenced herein (including the
Stock Option Agreement attached as Exhibit A, the Proprietary Information
Agreement attached as Exhibit C and the Arbitration Agreement attached as
Exhibit D). By executing this Agreement, the parties intend to amend and restate
the terms of that certain Employment Agreement by and between the Company and
Executive dated on or about November 7, 2003. To the extent that the practices,
policies or procedures of the Company, now or in the future, apply to Executive
and are inconsistent with the terms of this Agreement, the provisions of this
Agreement shall control. Any subsequent change in Executive's duties, position,
or compensation will not affect the validity or scope of this Agreement.
19. INJUNCTIVE RELIEF AND TERMINATION.
a. GENERAL. Executive acknowledges and agrees that (i) the covenants
and restrictions contained in Section 7 of this Agreement are necessary,
fundamental and required for the protection of the Business, (ii) such covenants
relate to matters which are of a special, unique and extraordinary character
that gives each of such covenants a special, unique and extraordinary value; and
(iii) the Company will suffer irreparable harm in the event that Executive
breaches any of his obligations under Section 7 hereof, and that monetary
damages shall be inadequate to compensate the Company for any such breach.
Executive agrees that in the event of any breach or threatened breach by
Executive of any of the provisions of Section 7 hereof, the Company shall be
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entitled to a temporary restraining order, preliminary injunction and/or
permanent injunction in order to prevent or restrain any such breach or
threatened breach by Executive, or by any or all of Executive's agents,
representatives or other persons directly or indirectly acting for, on behalf of
or with Executive, and the Company will not be obligated to post bond or other
security in seeking such relief.
b. NO LIMITATION OF REMEDIES. Notwithstanding the provisions set forth
in Section 19(a) above, or any other provision contained in this Agreement, the
parties hereby agree that no remedy conferred by any of the specific provisions
of this Agreement, including, without limitation, this Section 19, is intended
to be exclusive of any other remedy, and each and every remedy shall be
cumulative and shall be in addition to every other remedy given hereunder or now
or hereafter existing at law or in equity or by statute or otherwise.
20. EXECUTIVE ACKNOWLEDGEMENT
EXECUTIVE ACKNOWLEDGES THAT EXECUTIVE HAS HAD THE OPPORTUNITY TO
CONSULT LEGAL COUNSEL CONCERNING THIS AGREEMENT, THAT EXECUTIVE HAS READ AND
UNDERSTANDS THIS AGREEMENT, THAT EXECUTIVE IS FULLY AWARE OF ITS LEGAL EFFECT,
AND THAT EXECUTIVE HAS ENTERED INTO THIS AGREEMENT FREELY BASED ON EXECUTIVE'S
OWN JUDGMENT AND NOT ON ANY REPRESENTATIONS OR PROMISES OTHER THAN THOSE
CONTAINED IN THIS AGREEMENT.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first written above.
CRDENTIA CORP.: EXECUTIVE:
By: /s/ Xxxxxx Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxxx
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Name: Xxxxxx Xxxxxxxx Xxxxxxx X. Xxxxxxxx
Title: President
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