AMENDMENT TO EMPLOYMENT AGREEMENT
Exhibit 10.5
AMENDMENT TO
This Amendment (this “Amendment”) is made effective as of June 15, 2007, and is
entered into by and between Replidyne, Inc. (the “Company”), and Xxxxx Xxxxxxxx
(“Employee”) and, together with the Company, the “Parties”).
RECITALS
WHEREAS, the Company and Employee are parties to that certain Employment Agreement
dated April 4, 2006 (the “Employment Agreement”);
WHEREAS, in order to reflect the final terms and conditions related to Employee’s change in
control benefits and certain other changes to the Employment Agreement, the Parties desire to amend
certain terms of the Employment Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereby agree as follows:
AGREEMENT
| 1. | All capitalized terms used but not defined herein shall have the meanings assigned to them in the Employment Agreement. |
| 2. | The introductory paragraph of the Employment Agreement is hereby amended and restated to reflect this Amendment, and will now read in its entirety as follows: |
This Employment Agreement (the “Agreement”) is made as of this 4th day
of April, 2006, and amended effective June 15, 2007, by and between Replidyne,
Inc., (the “Company”), and Xxxxx Xxxxxxxx (“Employee”) (collectively, the
“Parties”).
Whereas, the Company wishes to continue to employ Employee and to
assure itself of the continued services of Employee on the terms set forth herein;
Whereas, Employee wishes to be so employed under the terms set forth
herein;
Whereas, Employee and the Company are parties to that certain Offer
Letter dated January 21, 2005;
Whereas, the Parties desire to amend and restate the Offer Letter to
reflect certain additional and revised terms of Employee’s employment; and
Whereas, the Parties intend that this Agreement, as amended, shall
supersede and replace any similar agreements that presently exist or may have
previously existed between the Parties regarding the terms of Employee’s employment
with the Company.
| 3. | Section 7 of the Employment Agreement is amended and restated to read in its entirety as follows: |
7. Bonus. Employee may be eligible to receive an annual performance bonus
of up to 50% of his Base Salary subject to employment taxes, withholding and
deductions (“Bonus”) based upon Employee’s achievements of certain milestones and
performance objectives established by the Company (“Variable Incentive Bonus Plan”).
Except as expressly provided otherwise herein, Employee must remain employed with
the Company throughout the applicable bonus year in order to be eligible for any
Bonus. The Board of Directors, in its sole discretion, shall determine the extent
to which Employee has achieved the performance targets upon which Employee’s Bonus
is based, and the amount of Bonus to be paid to Employee, if any. Bonuses are not
earned until they are approved in writing by the Board of Directors.
| 4. | Section 10(f) of the Employment Agreement is amended and restated to read in its entirety as follows: |
(f) Definition of Good Reason. Employee may voluntarily terminate Employee’s
employment for “Good Reason” by notifying the Company in writing, within thirty (30)
days after the occurrence of one of the following events taken without Employee’s
consent, that Employee intends to terminate Employee’s employment for Good Reason on
the thirtieth (30th) day following the Company’s receipt of Employee’s notice, if
the Company has not cured the event that gives rise to Good Reason before the end of
such thirty (30) day period: (i) a reduction in Employee’s Base Salary, bonus (if
any) or benefits that would materially diminish the aggregate value of Employee’s
total compensation and benefits; (ii) the assignment to Employee of duties that are
substantially and materially inconsistent with the position held by Employee prior
to the Change in Control and that are not a reasonable advancement of Employee’s
position within the Company; or (iii) a material change in geographic location (more
than 50 miles) from Employee’s current principal place of performing services on
behalf of the Company.
| 5. | Section 11(b) of the Employment Agreement is amended and restated to read in its entirety as follows: |
(b) Change of Control Termination. If within the thirteen (13) months
immediately following a Change in Control or the one (1) month immediately preceding
a Change in Control: (i) Employee is involuntarily terminated by the Company (or
its successor entity) other than for Cause or (ii) Employee voluntarily terminates
his employment with the Company (or its
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successor entity) for Good Reason (either constituting a “Change of Control
Termination”), and in each case Employee signs a Release and written acknowledgment
of Employee’s continuing obligations under the Proprietary Information Agreement,
Employee shall be entitled to receive the Severance Benefits set forth in Paragraph
10(d). In addition, the Company will vest all of the shares subject to the options
and such vesting shall occur upon the occurrence of the Change of Control in the
case of a Change of Control Termination occurring prior to the Change in Control or
upon termination in the case of a Change of Control Termination occurring after the
Change of Control. All other terms and conditions set forth in the options, the
Plan, and the applicable stock option agreements shall remain in full force and
effect.
Employee shall also be eligible to receive a bonus equal to the average of
Employee’s annual bonus for the two years prior to such Change in Control
Termination to be paid at the same time as bonuses are paid pursuant to the
Company’s policy.
| 6. | Section 12 of the Employment Agreement is amended and restated to read in its entirety as follows: |
12. Deferred Compensation. Severance Benefits and Change of Control Severance
Benefits pursuant to Sections 10(d) and 11(b) above, to the extent of payments made
from the date of termination of Executive’s employment through March 15 of the
calendar year following such termination, are intended to constitute separate
payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations and thus
payable pursuant to the “short-term deferral” rule set forth in Section
1.409A-1(b)(4) of the Treasury Regulations; to the extent such payments are made
following said March 15, they are intended to constitute separate payments for
purposes of Section 1.409A-2(b)(2) of the Treasury Regulations made upon an
involuntary termination from service and payable pursuant to Section
1.409A-1(b)(9)(iii) of the Treasury Regulations, to the maximum extent permitted by
said provision, with any excess amount being regarded as subject to the distribution
requirements of Section 409A(a)(2)(A) of the Internal Revenue Code of 1986, as
amended (the “Code”), including, without limitation, the requirement of Section
409A(a)(2)(B)(i) of the Code that payment to Executive be delayed until 6 months
after Executive’s separation from service if Executive is a “specified employee”
within the meaning of the aforesaid section of the Code at the time of such
separation from service.
| 7. | Except as set forth above, the Employment Agreement, as amended, shall remain in full force and effect in accordance with its terms. |
| 8. | This Amendment may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement. |
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| 9. | This Amendment shall be governed by and construed and enforced in accordance with the laws of the State of Colorado applicable to contracts made and to be performed entirely within such state. | |
| 10. | This Amendment shall be effective upon its execution by each of the Company and Employee. |
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IN WITNESS WHEREOF, the parties have executed this Amendment as of the date and year first
written above.
| /s/ Xxxxx Xxxxxxxx | ||||
| Xxxxx Xxxxxxxx | ||||
| REPLIDYNE, INC. |
||||
| By: | /s/ Xxxxxxx X. Xxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxx | |||
| Title: | Chief Executive Officer | |||
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