EMPLOYMENT AGREEMENT
THIS AGREEMENT effective the 18th day of December, 1997 (the "Effective
Date") between OSTEOTECH, INC., a Delaware corporation (the "Corporation") and
XXXXX X. XXXXXXX, Ph.D. (the "Employee").
WITNESSETH:
WHEREAS, the Corporation desires to employ the Employee as its Executive
Vice President and Chief Scientific Officer; and
WHEREAS, the Employee desires to accept such employment upon the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and obligations
hereinafter set forth, the parties hereto agree as follows:
1. Employment. The Corporation hereby employs the Employee, and the
Employee hereby accepts employment by the Corporation as the Executive Vice
President and Chief Scientific Officer of the Corporation upon the terms and
conditions set forth herein.
2. Term. Unless sooner terminated in accordance with this Agreement, the
initial term of this Agreement and the term of employment of the Employee shall
commence on the Effective Date hereof and shall expire on December 31, 1999 and
shall be automatically renewable for successive additional two (2) year terms
unless at least three (3) months prior to December 31, 1999 or the expiration
date of any subsequent term the Corporation terminates this Agreement by written
notice to the Employee, whereupon this Agreement shall be terminated at the end
of the applicable period (with such initial term and any two year renewal
thereof, unless sooner terminated in accordance with this Agreement being the
"Term of Employment").
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3. Duties. The Employee shall be employed in an executive capacity as the
Executive Vice President and Chief Scientific Officer of the Corporation. The
Employee shall perform such duties and services, consistent with his positions,
as may be assigned to him (from time to time) by the President and Chief
Executive Officer of the Corporation. In furtherance of the foregoing, the
Employee hereby agrees to perform well and faithfully the aforesaid duties and
responsibilities and the other reasonable senior executive duties and
responsibilities assigned to him from time to time by the Board of Directors of
the Corporation or its designee. During the Term of the Employment, the
Corporation shall provide the Employee with an office, secretarial and other
support services at its headquarters as may be required for the Employee to
perform the duties assigned to him hereunder.
4. Time to be Devoted to Employment.
(a) Except for vacations and absences due to temporary illness, during the
Term of Employment, the Employee shall devote his full time and energy to the
business of the Corporation.
(b) During the Term of Employment, the Employee shall not be engaged in any
other business activity which, in the reasonable judgment of the Corporation,
conflicts with the duties of the Employee hereunder, whether or not such
activity is pursued for gain, profit or other pecuniary advantage.
5. Compensation; Reimbursement.
(a) During the Term of Employment, the Corporation (or at the Corporation's
option, any subsidiary or affiliate thereof) shall pay to the Employee an annual
base salary ("Base Salary") of One Hundred Seventy-Eight Thousand and Eight
Dollars ($178,008.00), payable
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in installments as is the policy of the Corporation with respect to employees of
the Corporation at substantially the same employment level as the Employee, but
in no event less frequently than once per month. Thereafter, the Base Salary
shall be reviewed annually (with the first review effective April 1, 1998) and
shall be subject to increase at the option and in the sole discretion of the
Board of Directors of the Corporation.
(b) Employee shall be eligible for an annual bonus as determined by the
Board of Directors of the Corporation based on the Corporation's performance.
The Bonus payment to Employee for a calendar year is contingent upon the
Employee being retained as an employee of the Corporation at the time such
payments are made.
(c) Employee shall be eligible for an annual stock option grant consistent
with the Corporation's Stock Option Plan with said grant being determined by the
Board of Directors of the Corporation based on the Corporation's performance.
(d) During the Term of Employment, the Employee shall be entitled to such
fringe benefits as are made available from time to time to the employees of the
Corporation at substantially the same employment level as the Employee,
including, without limitation, 4 weeks paid vacation.
(e) The Corporation shall reimburse Employee, in accordance with the
practice from time to time for other officers of the Corporation, for all
reasonable and necessary traveling expenses, disbursements and other reasonable
and necessary incidental expenses incurred by him for or on behalf of the
Corporation in the performance of his duties hereunder upon presentation by the
Employee to the Corporation of appropriate vouchers, receipts and reports.
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6. Disability or Death.
(a) If the Employee is incapacitated or disabled by accident, sickness or
otherwise so as to render him mentally or physically incapable of performing the
services required to be performed by him under this Agreement for a period of
ninety (90) consecutive days or longer, the Employee will be eligible to receive
benefits under the Corporation's Long Term Disability Benefits Plan pursuant to
the terms and conditions of such plan. Until the Employee becomes eligible for
benefits under the Corporation's Long Term Disability Benefits Plan and so long
as the Corporation shall not have otherwise terminated the Employee's employment
hereunder in accordance with this Agreement, the Employee shall be entitled to
receive his compensation, notwithstanding any such Disability.
(b) If the Employee dies during the Term of Employment, his employment
hereunder shall be deemed to cease as of the date of his death.
7. Termination For Cause. The Corporation may terminate the employment of
the Employee hereunder at any time during the Term of Employment for "cause"
(such termination being hereinafter called a "Termination For Cause") by giving
the Employee notice of such termination, upon the giving of which such
termination shall take effect immediately. For the purposes of this Section 7,
"cause" shall mean (i) the Employee's actions on behalf of the Corporation or
any subsidiary or affiliate thereof, without the authorization of the Board of
Directors or the President and Chief Executive Officer of the Corporation, which
actions are knowingly for the pecuniary benefit of the Employee or members of
his family and which actions materially and adversely effect the business or
affairs of the Corporation or any subsidiary or affiliate thereof, or (ii) the
Employee fails in any material respect to observe and
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perform his obligations hereunder, the Corporation's rules of conduct as set
forth in its Employee Handbook or under the Employee Confidential Information,
Invention and Non-Competition Agreements by and between the Employee and
Corporation, which failure is not cured within twenty (20) days after written
notice thereof is given to the Employee by the Corporation, or, (iii) the
commission by the Employee of an act involving embezzlement or fraud against the
Corporation or commission or conviction of a felony or (iv) the repeated use by
the Employee of alcohol in a manner which impairs his duties or the use of any
controlled substance other than under a physicians prescription.
8. Termination Without Cause. The Corporation may, with the approval of a
majority of the Board of Directors of the Corporation, terminate the employment
of the Employee hereunder at any time during the Term of Employment without
"cause" (such termination being hereinafter called a "Termination Without
Cause") by giving the Employee notice of such termination, and upon the giving
of such notice, termination shall take effect immediately.
9. Voluntary Termination. Any termination of the employment of the Employee
hereunder otherwise then as a result of an Involuntary Termination, a
Termination For Cause or a Termination Without Cause shall be deemed to be a
"Voluntary Termination". A Voluntary Termination shall be deemed to be effective
immediately upon receipt of notice to the Corporation of such termination.
10. Effect of Termination of Employment.
(a) Upon the termination of the Employee's employment hereunder pursuant to
a Voluntary Termination or a Termination For Cause, neither the Employee nor his
beneficiary
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or estate shall have any further rights or claims against the Corporation under
this Agreement except to receive:
(i) the unpaid portion of the Base Salary provided for in Section
5(a), computed on a pro rata basis to the date of termination; and
(ii) reimbursement for any expenses for which the Employee shall not
have theretofore been reimbursed as provided in Section 5(d).
(iii) any amounts due and owing to the Employee by the Corporation
under any benefit plan.
(b) Upon the termination of the Employee's employment hereunder pursuant to
Disability or death, neither the Employee nor his beneficiary or estate shall
have any further rights or claims against the Corporation under this Agreement
except to receive payments equal to that provided for in Section 6(a), if
applicable, and Section 10(a) hereof and any other benefits available under the
Corporation's Benefits Plans.
(c) Upon the termination of the Employee's employment hereunder pursuant to
a Termination Without Cause, neither the Employee nor his beneficiary or estate
shall have any further rights or claims against the Corporation under this
Agreement except to receive a termination payment equal to that provided for in
Section 10(a) hereof, plus an aggregate amount equal to twelve (12) months Base
Salary, payable in twelve (12) equal monthly installments and the continuation
of medical and dental benefits and life insurance for the same twelve (12) month
period to the extent such benefits were being provided to Employee at the time
of termination.
11. General Provisions
(a) This Agreement and any or all terms hereof may not be changed, waived,
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discharged, or terminated orally, but only by way of an instrument in writing
signed by the parties.
(b) This Agreement shall be governed by and construed in accordance with
the laws of the State of New Jersey, without reference to the conflicts of laws
of the State of New Jersey or any other jurisdiction.
(c) If any portion of this Agreement shall be found to be invalid or
contrary to public policy, the same may be modified or stricken by a Court of
competent jurisdiction, to the extent necessary to allow the Court to enforce
such provision in a manner which is as consistent with the original intent of
the provision as possible. The striking or modification by the Court of any
provision shall not have the effect of invalidating the Agreement as a whole.
(d) Employee acknowledges that he has signed the Corporation's Confidential
Information, Invention and Non-Competition Agreements and said agreements are
made a part hereof.
(e) This Agreement, together with the Corporation's Confidential
Information, Invention and Non-Competition Agreements, constitutes the entire
and exclusive agreement between Employee and Corporation pertaining to the
subject matter thereof, and supersedes and replaces any and all earlier
agreements.
12. Notices. Notices and other communications hereunder shall be in writing
and shall be delivered personally or sent by air courier or first class
certified or registered mail, return receipt requested and postage prepaid,
addressed as follows:
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If to the Employee:
Xxxxx X. Xxxxxxx, Ph.D.
00 Xxxx Xxxxxx
Xxxxxx Xxxxxx, XX 00000
If to the Corporation:
Osteotech, Inc.
00 Xxxxx Xxx
Xxxxxxxxx, XX 00000
Attn: Secretary
Copy to:
Xxxxxx X. Xxxxxxx, Esq.
Carella, Byrne, Bain, Gilfillan,
Xxxxxx, Xxxxxxx & Olstein
0 Xxxxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of delivery if personally delivered; on the business day after the date
when sent if sent by air courier; and on the third business day after the date
when sent if sent by mail, in each case addressed to such party as provided in
this Section or in accordance with the latest unrevoked direction from such
party.
13. 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.
14. Assignment. This Agreement is personal in its nature and the parties
hereto shall not, without the consent of the other, assign or transfer this
Agreement or any rights or obligations hereunder; provided, however, that the
provisions hereof shall inure to the benefit of, and be binding upon (i) each
successor of the Corporation, whether by merger,
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consolidation, transfer of all or substantially all assets, or otherwise and
(ii) the heirs and legal representatives of the Employee.
15. Termination of Prior Agreement. This Agreement supersedes and replaces
the Employment Agreement dated December 18, 1995 by and between the Corporation
and Employee.
IN WITNESS WHEREOF, the parties have duly executed this Agreement effective
as of the date first above written.
OSTEOTECH, INC. XXXXX X. XXXXXXX, Ph.D.
By:__________________________ _____________________________
Title:_______________________
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