Exhibit 10.9
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made this 31st day
of December, 1998 by and between Integra LifeSciences Corporation, a
Delaware corporation, and Donald Nociolo ("Executive").
Background
Executive is currently the Vice President, Manufacturing Operations of Company.
Company desires to continue to employ Executive, and Executive desires to remain
in the employ of Company, on the terms and conditions contained in this
Agreement. Executive will be substantially involved with Company's operations
and management and will learn trade secrets and other confidential information
relating to Company and its customers; accordingly, the noncompetition covenant
and other restrictive covenants contained in Section 13 of this Agreement
constitute essential elements hereof.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein and intending to be legally bound hereby, the parties hereto
agree as follows:
Terms
1.Definitions. The following words and phrases shall have the meanings set forth
below for the purposes of this Agreement (unless the context clearly indicates
otherwise):
(a)"Base Salary" shall have the meaning set forth in Section 5.
(b)"Board" shall mean the Board of Directors of Company, or any successor
thereto.
(c)"Cause, " as determined by the Board in good faith, shall mean
Executive has -
(1)failed to perform his stated duties and not cured such
failure (if curable) within 15 days of his receipt of written notice of the
failure;
(2)breached any provision of this Agreement and not cured such
breach (if curable) within 15 days of his receipt of written notice
of the breach;
(3)demonstrated his personal dishonesty in connection with his
employment by Company;
(4)engaged in willful misconduct;
(5)engaged in a breach of fiduciary duty:
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(6)willfully violated any law, rule or regulation, or final
cease-and-desist order (other than traffic violations or similar
offenses); or
(7)engaged in other serious misconduct of such a nature that
his continued employment may reasonably be expected to affect
Company adversely.
(d)A "Change in Control" of Company shall be deemed to have occurred:
(1) if the "beneficial ownership" (as defined in Rule l3d-3
under the Securities Exchange Act of 1934) of securities representing more than
fifty percent (50%) of the combined voting power of Company Voting Securities
(as herein defined) is acquired by any individual, entity or group (a "Person"),
Company, any trustee or other fiduciary holding securities under any employee
benefit plan of Company or an affiliate thereof, or any corporation owned,
directly or indirectly, by the stockholders of Company in substantially the same
proportions as their ownership of stock of Company (for purposes of this
Agreement, "Company Voting Securities" shall mean the then outstanding voting
securities of Company entitled to vote generally in the election of directors);
provided, however, that any acquisition from Company or any acquisition pursuant
to a transaction which complies with clauses (i), (ii) and (iii) of paragraph
(3) of this definition shall not be a Change in Control under this paragraph
(1); or
(2) if individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or
(3) upon consummation by Company of a reorganization, merger
or consolidation or sale or other disposition of all or substantially all of the
assets of Company or the acquisition of assets or stock of another entity (a
"Business Combination"), in each case, unless immediately following such
Business Combination: (i) more than 50% of the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of
directors of (x) the corporation resulting from such Business Combination (the
"Surviving Corporation"), or (y) if applicable, a corporation which as a result
of such transaction owns Company or all or substantially all of Company's assets
either directly or through one or more subsidiaries (the "Parent Corporation"),
is represented, directly or indirectly, by Company Voting Securities outstanding
immediately prior to such Business Combination (or, if applicable, is
represented by shares into which such Company Voting Securities were converted
pursuant to such Business Combination), and such voting power among the holders
thereof is in substantially the same proportions as their ownership, immediately
prior to such Business Combination, of the Company Voting Securities; (ii) no
Person (excluding any employee benefit plan (or related trust) of Company or
such corporation resulting from such Business Combination) beneficially
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owns, directly or indirectly, 50% or more of the combined voting power of the
then outstanding voting securities eligible to elect directors of the Parent
Corporation (or, if there is no Parent Corporation, the Surviving Corporation)
except to the extent that such ownership of Company existed prior to the
Business Combination; and (iii) at least a majority of the members of the board
of directors of the Parent Corporation (or, if there is no Parent Corporation,
the Surviving Corporation) were members of the Incumbent Board at the time of
the execution of the initial agreement, or the action of the Board, providing
for such Business Combination; or
(4) upon approval by the stockholders of Company of a complete
liquidation or dissolution of Company.
(e)"Code" shall mean the Internal Revenue Code of 1986, as amended.
(f)"Company" shall mean Integra LifeSciences Corporation and any
corporation, partnership or other entity owned directly or indirectly, in whole
or in part, by Integra LifeSciences Corporation.
(g)"Disability" shall mean Executive's inability to perform his duties
hereunder by reason of any medically determinable physical or mental impairment
which is expected to result in death or which has lasted or is expected to last
for a continuous period of not fewer than six months.
(h)"Good Reason" shall mean:
(l)a material breach of this Agreement by Company which is not
cured by Company within 15 days of its receipt of written notice of
the breach;
(2)without Executive's express written consent, the Board
reduces Executive's Base Salary or the aggregate fringe benefits
provided to Executive (except to the extent permitted by Section 5
or Section 6, respectively); provided, Executive resigns within 30
days after the change objected to; or
(3)Company fails to obtain the assumption of this Agreement by
any successor to Company.
(i)"Principal Executive Office" shall mean Company's principal office for
executives, presently located at 105 Morgan Lane, Plainsboro, New Jersey 08536.
(j)"Retirement" shall mean the termination of Executive's employment with
Company in accordance with the retirement policies, including early retirement
policies, generally applicable to Company's salaried employees.
(k)"Termination Date" shall mean the date specified in the Termination
Notice.
(l)"Termination Notice" shall mean a dated notice which: (i) indicates the
specific termination provision in this Agreement relied upon (if any); (ii) sets
forth in reasonable detail the facts and circumstances claimed to provide a
basis for the termination of Executive's employment under such provision; (iii)
specifies a Termination Date; and (iv) is given in the
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manner specified in Section l4(h).
2.Employment. Company hereby employs Executive as Vice President, Manufacturing
Operations and Executive hereby agrees to continue such employment and agrees to
render services to Company in such capacity (or in such other capacity in the
future as the Chief Executive Officer may decide in his sole discretion) on the
terms and conditions set forth in this Agreement. Executive's primary place of
employment shall be at the Principal Executive Office or other corporate
location, as the Chief Executive Officer deems appropriate.
3.Term.
(a)Term and Renewal of Agreement. Unless earlier terminated by Executive
or Company as provided in Section 9 hereof, the term of Executive's employment
under this Agreement shall be two (2) years, commencing on the date of this
Agreement and, subject to subsection 3(b), shall be deemed automatically,
without further action, to extend for an additional year on each annual
anniversary of the date of this Agreement.
(b)Annual Review. Prior to the second annual anniversary of the date of
this Agreement and each annual anniversary thereafter, the Board shall consider
extending the term of this Agreement. The term shall continue to extend in the
manner set forth in subsection 3(a) unless either the Board does not approve the
extension and provides written notice to Executive of such event, or Executive
gives written notice to Company of Executive's election not to extend the term.
In either case, the written notice shall be given not fewer than 30 days prior
to any such anniversary date. References herein to the term of this Agreement
shall refer both to the initial term and successive terms.
4.Duties. Executive shall:
(a)faithfully and diligently do and perform all such acts and duties, and
furnish such services as are assigned to Executive as of the date this Agreement
is signed, and (subject to Section 2) such additional or different acts, duties
and services as the Chief Executive Officer may assign in the future; and
(b)devote his full professional time, energy, skill and best efforts to
the performance of his duties hereunder, in a manner that will faithfully and
diligently further the business and interests of Company, and shall not be
employed by or participate or engage in or in any manner be a part of the
management or operations of any business enterprise other than Company without
the prior written consent of the Board or the Chief Executive Officer, which
consent may be granted or withheld in its or his sole discretion.
5.Compensation. Company shall compensate Executive for his services at a minimum
base salary of$125,000 per year ("Base Salary"), payable in periodic
installments in accordance with Company's regular payroll practices in effect
from time to time. Executive's Base Salary shall be subject to annual reviews,
but may not be decreased without Executive's express written consent (unless the
decrease is pursuant to a general compensation reduction applicable to all, or
substantially all, executive officers of Company). Bonus payments may be made as
determined
appropriate by the Board in its sole discretion.
7.Benefit Plans. Executive shall be entitled to participate in and receive
benefits under any employee benefit plan or stock-based plan of Company, and
shall be eligible for any other plans and benefits covering executives of
Company, to the extent commensurate with his then duties and responsibilities
fixed by the Board. Company shall not make any change in such plans or benefits
which would adversely affect Executive's rights thereunder, unless such change
affects all, or substantially all, executive officers of Company.
8. Vacation. Executive shall be entitled to paid annual vacation in accordance
with the policies established from time to time by the Board, which shall in no
event be fewer than three weeks per annum:
9.Disability .In the event Executive incurs a Disability, Executive's obligation
to perform services under this Agreement will terminate, and the Board may
terminate this Agreement upon written notice to Executive.
10.Termination.
(a)Termination without Salary Continuation. In the event (i) Executive
terminates his employment hereunder other than for Good Reason, or (ii)
Executive's employment is terminated by Company due to his Retirement,
Disability or death, or for Cause, Executive shall have no right to compensation
or other benefits pursuant to this Agreement for any period after his last day
of active employment.
(b)Termination with Salary Continuation (No Change in Control). Except as
provided in subsection 9( c) in the event of a Change in Control, in the event
(i) Executive's employment is terminated by Company for a reason other than
Retirement, Disability, death or Cause, or (ii) Executive terminates his
employment for Good Reason, then Company shall:
(1) pay Executive a severance amount equal to the
greater of (i) one times Executive's Base Salary as of his
last day of active employment, or (ii) the unpaid portion of
Executive's Base Salary for the remainder of the then current
term of this Agreement; the severance amount shall be paid in
a single sum on the first business day of the month following
the Termination Date (unless Executive elects, in writing and
on, or not later than 30 days after, the date this Agreement
is executed, to receive the severance payment divided into 24
equal monthly installments, paid beginning on the first
business day of the month following the Termination Date); and
(2) maintain and provide to Executive, at no cost to
Executive, for a period ending at the earliest of (i) the
expiration of 12 months from Executive's last day of active
employment; (ii) the date of Executive's full-time employment
by another employer; or (iii) Executive's death, continued
participation in all group insurance, life insurance, health
and accident, disability, and other employee benefit plans in
which Executive would have been entitled to
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participate had his employment with Company continued
throughout such period, provided that such participation is
not prohibited by the terms of the plan or by Company for
legal reasons.
(c)Termination with Salary Continuation (Change in Control).
Notwithstanding anything to the contrary set forth in subsection 9(b), in
the event within six months of a Change in Control: (i) Executive
terminates his employment for Good Reason; or (ii) Executive's employment
is terminated by Company for a reason other than Retirement, Disability,
death or Cause, then Company shall:
(l)pay Executive a severance amount equal to 1.99 times
Executive's Base Salary as of his last day of active
employment prior to the Change in Control; the severance
amount shall be paid in a single sum on the first business day
of the month following the Termination Date (unless Executive
elects, in writing and on, or not later than 30 days after,
the date this Agreement is executed, to receive the severance
payment divided into 24 equal monthly installments, paid
beginning on the first business day of the month following the
Termination Date); and
(2)maintain and provide to Executive, at no cost to
Executive, for a period ending at the earliest of (i) the
expiration of 12 months from Executive's last day of active
employment; (ii) the date of Executive's full-time employment
by another employer; or (iii) Executive's death, continued
participation in all group insurance, life insurance, health
and accident, disability, and other employee benefit plans in
which Executive would have been entitled to participate had
his employment with Company continued throughout such period,
provided that such participation is not prohibited by the
terms of the plan or by Company for legal reasons.
(d)Termination Notice. Except in the event of Executive's death, a
termination under this Agreement shall be effected by means of a
Termination Notice.
11. Withholding. Company shall have the right to withhold from all payments made
pursuant to this Agreement any federal, state, or local taxes and such other
amounts as may be required by law to be withheld from such payments.
12.Assignability . Company may assign this Agreement and its rights and
obligations hereunder in whole, but not in part, to any entity to which Company
may transfer all or substantially all of its assets, if in any such case said
entity shall expressly in writing assume all obligations of Company hereunder as
fully as if it had been originally made a party hereto. Company may not
otherwise assign this Agreement or its rights and obligations hereunder. This
Agreement is personal to Executive and his rights and duties hereunder shall not
be assigned except as expressly agreed to in writing by Company.
13.Death of Executive. Any amounts due Executive under this Agreement (not
including any Base Salary not yet earned by Executive) unpaid as of the date of
Executive's death shall be paid in a single sum as soon as practicable after
Executive's death to Executive's surviving spouse, or if none, to the duly
appointed personal representative of his estate.
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14.Restrictive Covenants.
(a)Covenant Not to Compete. During the term of this Agreement and for a
period of two (2) years following the Termination Date, Executive shall not
directly or indirectly: (i) engage, anywhere within the geographical areas in
which Company is conducting business operations or providing services as of the
date of Executive's termination of employment, in the tissue engineering
business (the use of implantable absorbable materials, with or without a
bioactive component, to attempt to elicit a specific cellular response in order
to regenerate tissue or to impede the growth of tissue or migration of cells)
(the "Tissue Engineering Business") or any other business the revenues of which
constituted at least 30% of Company's revenues during the six (6) month period
prior to the Termination Date (together with the Tissue Engineering Business,
the "Business"); (ii) be or become a stockholder, partner, owner, officer,
director or employee or agent of, or a consultant to or give financial or other
assistance to, any person or entity engaged in the Business; (iii) seek in
competition with the business of Company to procure orders from or do business
with any customer of Company; (iv) solicit or contact with a view to the
engagement or employment by any person or entity of any person who is an
employee of Company; (v) seek to contract with or engage (in such a way as to
adversely affect or interfere with the business of Company) any person or entity
who has been contracted with or engaged to manufacture, assemble, supply or
deliver products, goods, materials or services to Company; or (vi) engage in or
participate in any effort or act to induce any of the customers, associates,
consultants, or employees of Company to take any action which might be
disadvantageous to Company; Provided, however, that nothing herein shall
prohibit Executive and his affiliates from owning, as passive investors, in the
aggregate not more than 5% of the outstanding publicly traded stock of any
corporation so engaged.
(b) Confidentiality. Executive acknowledges a duty of confidentiality owed
to Company and shall not, at any time during or after his employment by Company,
retain in writing, use, divulge, furnish, or make accessible to anyone, without
the express authorization of the Board, any trade secret, private or
confidential information or knowledge of Company obtained or acquired by him
while so employed. All computer software, business cards, telephone lists,
customer lists, price lists, contract forms, catalogs, Company books, records,
files and know-how acquired while an employee of Company are acknowledged to be
the property of Company and shall not be duplicated, removed from Company's
possession or premises or made use of other than in pursuit of Company's
business or as may otherwise be required by law or any legal process, or as is
necessary in connection with any adversarial proceeding against Company and,
upon termination of employment for any reason, Executive shall deliver to
Company, without further demand, all copies thereof which are then in his
possession or under his control. No information shall be treated, as
"confidential information" if it is generally available public knowledge at the
time of disclosure or use by Executive.
(c) Inventions and Improvements. Executive shall promptly communicate to
Company all ideas, discoveries and inventions, which are or may be useful to
Company or its business. Executive acknowledges that all such ideas,
discoveries, inventions, and improvements which heretofore have been or are
hereafter made, conceived, or reduced to practice by him at any time during his
employment with Company heretofore or hereafter gained by him at any time during
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his employment with Company are the property of Company, and Executive hereby
irrevocably assigns all such ideas, discoveries, inventions, and improvements to
Company for its sole use and benefit, without additional compensation. The
provisions of this Section 13(c) shall apply whether such ideas, discoveries,
inventions, or improvements were or are conceived, made or gained by him alone
or with others, whether during or after usual working hours, whether on or off
the job, whether applicable to matters directly or indirectly related to
Company's business interests (including potential business interests), and
whether or not within the specific realm of his duties. Executive shall, upon
request of Company, but at no expense to Executive, at any time during or after
his employment with Company, sign all instruments and documents reasonably
requested by Company and otherwise cooperate with Company to protect its right
to such ideas, discoveries, inventions, or improvements including applying for,
obtaining, and enforcing patents and copyrights thereon in such countries as
Company shall determine.
(d)Breach of Covenant. Any breach or violation of the provisions in this
Section 13 by Executive will result in forfeiture by Executive and all other
persons of all rights to any further payments or benefits under this Agreement,
and in such event Company shall have no further obligation to pay any amounts
related thereto. Executive expressly acknowledges that damages alone will be an
inadequate remedy for any breach or violation of any of the provisions of this
Section 13 and that Company, in addition to all other remedies, shall be
entitled as a matter of right to equitable relief, including injunctions and
specific performance, in any court of competent jurisdiction. If any of the
provisions of this Section 13 are held to be in any respect unenforceable, then
they shall be deemed to extend only over the maximum period of time, geographic
area, or range of activities as to which they may be enforceable.
15.Miscellaneous.
(a)Amendment. No provision of this Agreement may be amended unless such
amendment is signed by Executive and such officer as may be specifically
designated by the Board to sign on Company's behalf.
(b)Nature of Obligations. Nothing contained herein shall create or require
Company to create a trust of any kind to fund any benefits which may be payable
hereunder, and to the extent that Executive acquires a right to receive benefits
from Company hereunder, such right shall be no greater than the right of any
unsecured general creditor of Company.
(c)Prior Employment. Executive represents and warrants that his acceptance
of employment with Company has not breached, and the performance of his duties
hereunder will not breach, any duty owed by him to any prior employer or other
person.
(d)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. In the event of a conflict between a heading
and the content of a Section, the content of the Section shall control.
(e)Gender and Number. Whenever used in this Agreement, a masculine pronoun
is deemed to include the feminine and a neuter pronoun is deemed to include both
the masculine and
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feminine, unless the context clearly indicates otherwise. The singular form,
whenever used herein, shall mean or include the plural form where applicable.
(f)Severability .If any provision of this Agreement or the application
thereof to any person or circumstance shall be invalid or unenforceable under
any applicable law, such event shall not affect or render invalid or
unenforceable any other provision of this Agreement and shall not affect the
application of any provision to other persons or circumstances.
(g)Binding Effect. This Agreement shall be binding upon and inure to
the-benefit of the parties hereto and their respective successors, permitted
assigns, heirs, executors, and administrators.
(h)Notice. For purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given if hand- delivered, sent by documented overnight
delivery service or by certified or registered mail, return receipt requested,
postage prepaid, addressed to the respective addresses set forth below:
To the Company:
Integra LifeSciences Corporation
105 Morgan Lane
Plainsboro, New Jersey 08536
Attn: President
To the Executive:
Mr .Donald Nociolo
98 Nassau Street
Apt 2
Princeton, NJ 08540
(i) Entire Agreement. This Agreement sets forth the entire understanding
of the parties and supersedes all prior agreements, arrangements and
communications, whether oral or written, pertaining to the subject matter
hereof.
(j) Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the United States
where applicable and otherwise by the laws of the State of New Jersey.
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IN WITNESS WHEREOF, this Agreement has been executed as of the date
first above written.
INTEGRA LIFESCIENCES
CORPORATION
By: /s/ Stuart Essig
--------------------
Title: President
EXECUTIVE
/s/ Donald Nociolo
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