EXHIBIT 10.8
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is hereby made and entered
into as of the 30th day of March 1998, by and between Biodynamics International,
Inc., a Florida corporation (the "Employer"), and Xxxxxx Xxxxxxxx, a resident of
the Stare of New Jersey (the "Employee").
WITNESSETH:
1. Employment. The Employer hereby employs the Employee and the Employee hereby
accepts such employment, upon the terms and subject to the conditions set forth
in this Agreement.
2. Term. The term of the employment under this Agreement shall be for an initial
two-year period beginning as of the date of this Agreement and terminating on
March 30, 2000, unless such employment is otherwise terminated as provided in
paragraphs 8, 9 and 10 of this Agreement.
3. Compensation; Reimbursement, Etc.
(a) The basic compensation to the Employee shall be payable bi-weekly
based upon a calendar-year annual base salary of $125,000 (the "Annual Base
Salary").
(b) The Employee shall be eligible for an annual bonus in an amount of up
to twenty-five (25%) of his Annual Base Salary (the "Annual Bonus"). The amount
of such Annual Bonus shall be determined by the Employer's Compensation and
Stock Option Committee, based fifty percent (50%) on "Employee Performance", and
fifty percent (50%) on "Company Performance", as determined in accordance with
the Employer's 1996 Management and Compensation Plan, a copy of which is
attached hereto.
(i) The Employee's Annual Bonus shall be pro-rated for the Employer's
fiscal year ending September 30, 1998.
(c) The Employee shall receive a non-qualified, stock option for the
purchase of 100,000 shares of the Employer's common shares, par value $.01 per
share (the "Common Shares"), (the "Employee's Option"). The Employee's Option
shall be evidenced by an option agreement containing such terms and provisions
as the Employer's Board of Directors or Compensation and Stock Option Committee
shall deem appropriate. Notwithstanding anything in said option agreement to the
contrary: (i) the per share exercise price of the Employee's Option shall be the
fair market value of the Common Shares on the date of this Agreement; (ii)
twenty-five percent (25%) of the shares subject to the Employee's Option shall
be fully-vested and immediately exercisable as of the date of grant; (iii) the
remaining 75,000 shares subject to the Employee's Option shall vest and become
exercisable on three equal annual amounts, commencing on the first anniversary
from the date of grant; (iv) the Employee's Option shall expire on the tenth
anniversary of the date on which it was granted unless earlier terminated as
provided in paragraph 10; (v) the Employee's Option shall be non-transferable,
except by will or by operation of the laws of descent and distribution and (vi)
the Employee Option shall contain such other terms and provisions as shall be
substantially similar to the terms and provisions of stock options granted to
other executive officers of the Employer. The Employer represents and warrants
that the Common Shares issuable upon exercise of the Employee Option are or will
be covered by an effective registration statement on Form S-8 or other
applicable form within 90 days. The Employer agrees to use its best efforts to
maintain the effectiveness of such registration until such
time as the Employee Option has terminated in accordance with its terms or all
of the Common Shares issuable under the Employee Option have been issued.
(d) The Employee shall be entitled to such other benefits as the Board of
Directors and/or the Compensation and Stock Option Committee may from time to
time provide to him, which shall include the entitlement to participation in the
Employer's 401K Plan (available wit 50% Employer match up to established IRS
limits), participation in the Employer's group medical, and dental plans, and
life insurance. Seventy-five percent (75%) of the premiums on any such insurance
benefits shall be paid by the Employer, and the remaining twenty-five percent
(25%) shall be paid by the Employee from payroll deductions.
4. Duties. The Employee is engaged as the Chief Financial Officer, Corporate
Secretary and Treasurer of the Employer, and he shall have such duties
consistent with such offices as may from time to time be reasonably assigned to
him by the Board of Directors of the Employer and provided for in the bylaws of
the Employer. Employee's office shall be located at the Employer's executive
office (currently in Parsippany, N.J.).
5. Extent of Services. During the term of his employment under this Agreement,
the Employee shall devote such time and efforts to the business of the Employer,
as may be reasonably necessary in the normal course of business.
6. Performance Review. A review of the Employee's performance and salary shall
be held six months from the commencement date of his employment, and annually
thereafter. Such review may not result in a reduction of the Employee's salary
and/or benefits under this Agreement.
7. Vacation and Days Off. The Employee shall be entitled to such vacation time
during each fiscal year of the Employer as he may qualify for, in accordance
with any vacation policy from time to time established by the Employer's Board
of Directors. Notwithstanding the foregoing, the Employee shall be entitled to
an annual vacation period of not less than three (3) weeks, during which time
his compensation shall be paid in full.
8. Disability, Illness and Incapacity.
(a) During the term of this Agreement, for any period of disability,
illness or incapacity which renders the Employee at least temporarily unable to
perform the services required under this Agreement, the Employee shall receive
his full compensation as set forth in paragraph 1 of this Agreement, provided
however, if the Employees disability, illness or incapacity extends beyond a
period of sixty (60) consecutive days, the Employee shall not be entitled, after
the expiration of such sixty (60) day period, to any further compensation under
paragraph 3(a) until he returns to full-time service hereunder, but he shall be
entitled only to such disability payments as may be provided by a disability
insurance policy or policies, purchased by the Employer, as provided in
paragraph 3(d) of this Agreement.
(b) Successive periods of disability, illness or incapacity will be
considered separate unless the later period of disability, illness or incapacity
is due to the same or related cause and commences less than one year from the
ending of the previous period of disability.
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(c) If and when the period of disability, illness or incapacity of the
Employee totals 180 days, his employment with the Employer shall terminate.
Notwithstanding the foregoing, if the Employee and the Employer agree, the
Employee may thereafter be employed by the Employer upon such terms as may be
mutually agreeable.
(d) Any dispute regarding the existence, extent or continuance of the
disability, illness or incapacity shall be resolved by the determination of a
majority of three competent doctors who are not employees of the Employer, one
of which shall be selected by the Employer, one of which shall be selected by
the Employee and a third selected by the other two doctors. The doctors' fees
and other charges associated with such determination shall be paid by the
Employer.
9. Death.
(a) All rights of the Employee hereunder shall terminate upon his death,
except that the Employer shall pay to the estate of the Employee such
compensation and other amounts as would otherwise have been payable to the
Employee through the end of the month in which his death occurs. The Employer
shall have no additional financial obligation under this Agreement to the
Employee or his estate.
10. Other Terminations.
(a) Either the Employee or the Employer may terminate the employment of the
Employee hereunder, upon written notice given ninety (90) days prior to the end
of the term provided for in paragraph 2 of this Agreement, or any extension
thereof. The term of the Employee's employment after the initial term shall be
automatically renewed for successive one (1) year terms unless otherwise
terminated by written notice.
(i) If the Employee gives notice pursuant to paragraph 10(a) above,
the Employer shall have the right to immediately relieve the Employee, in
whole or in part, of his duties under this Agreement, provided however,
there shall be no reduction in the Employee's compensation until expiration
of the ninety-day period at which time compensation shall cease.
(b) The Employer may terminate the employment of the Employee hereunder
without the notice provided for in subparagraph (a) of this paragraph 10, for
any of the following reasons:
(i) Employee's failure to promptly and adequately perform the duties
assigned to him by the Employer pursuant to paragraph 4 above, including
but not limited to failure to folloW the direction of the Board of
Directors of the Employer, or of any supervisors or superiors of Employee;
(ii) Employee's material breach of any provision of this Agreement; or
(iii) other good cause (as defined below).
(c) The term "good cause" as used in this Agreement shall include, but
shall not necessarily be limited to, habitual absenteeism, a pattern of conduct
which tends to hold the Employer up to ridicule in the community, conviction of
any crime of moral turpitude, abuse of and substantial
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dependence on, as reasonably determined by the Board of Directors of the
Employer, on any addictive substance, including but not limited to alcohol,
amphetamines, barbiturates, methadone, cannabis, cocaine, PCP, THC, LSD or
illegal or narcotic drugs. If any determination of abuse and substantial
dependence by the Board of Directors is disputed by the Employee, the parties
hereto agree to abide by the decision of a panel of three physicians who are not
employees of the Employer, one of which shall be selected by the Employer, one
of which shall be selected by the Employee and a third selected by the other two
(2) doctors. The Employee agrees to make himself available for and submit to
examinations by such physicians as may be directed by the Employer. Failure to
submit to any such examination shall constitute a breach of a material part of
this Agreement. The doctors' fees and other charges associated with such
determination shall be shared equally by the Employer and the Employee.
(d) Employee may terminate this Agreement for "Good Reason" which shall
result from (i) a change of control of the Company, i.e. as a result of a merger
or sale of the assets so that over 50% of the outstanding shares are held by a
new investor or group of investors (ii) the Company's executive offices are
relocated more than fifty (50) miles from Parsippany, New Jersey or (iii) the
Employer's material breach of any of its obligations under this Agreement.
(e) If the Employee's employment with the Employer is terminated pursuant
to paragraph 10(b), the Employer shall pay to the Employee any compensation
earned but not paid to the Employee prior to such termination. Such payment
shall be in full and complete discharge of any and all liabilities or
obligations of the Employer to the Employee hereunder, and the Employee shall be
entitled to no further benefits under this Agreement, except as otherwise
specifically provided in paragraph 3 of this Agreement. If the Employee's
employment with Employer is terminated by Employer for a reason (other than as
set forth under paragraph 10(b)) or by Employee pursuant to paragraph (d),
Employer will compensate Employee as severance pay the lesser of (i) six month
salary or (ii) remainder of the term of this Agreement. The severance will be
payable at the Employee's current base salary at time of termination, payable in
six equal installments over a three month period.
11. Disclosure.
(a) The Employee agrees that he will fully disclose, and disclose only to
the Employer, all ideas, methods, plans, developments, improvements or
patentable inventions, of any kind, which relate directly or indirectly to the
business of the Employer, and which were known, made or discovered by the
Employee during the performance of his duties under this Agreement, at any time
during the term of his employment by the Employer, and for a period of twelve
(12) months after the termination of his employment with the Employer.
(b) All disclosures are to be made promptly after conception or discovery
of any such idea, method, plan, development, improvement or invention.
(c) Nothing in this paragraph 11 shall be construed as requiring any
communication to the Employer of any such idea, method, plan, development,
improvement or invention, if such are lawfully protected by any other lawful
prohibition against such communication.
(d) Any such idea, method, plan, development, improvement or invention,
which the Employee is obligated to disclose to the Employer under this paragraph
11, shall be the property of the Employer, and the Employee agrees that he will
provide any and all assistance to the Employer in
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making any patent applications or other applications for obtaining exclusive
rights in, and will do all other things that may be reasonably necessary to vest
in the Employer or its assigns, all such ideas, methods, plans, developments,
improvements or inventions.
12. Confidentiality. The Employee agrees to keep in strict secrecy and
confidence any and all information the Employee assimilates or to which he has
access during his employment by the Employer and which has not been publicly
disclosed and is not a matter of common knowledge in the fields of work of the
Employer. The Employee agrees that both during and after the term of his
employment by the Employer, he will not, without prior written consent of the
Employer, disclose any such confidential information to any third person,
partnership, joint venture, company, corporation or other organization.
13. Non-competition and Non-solicitation.
(a) During the term of this Agreement and for a period of one (1) year
after the termination of his employment with the Employer, pursuant to
paragraphs 10(a) or 10(b), and except as contemplated herein, the Employee
agrees to refrain from, and shall not:
(i) within the State of New Jersey or within any other state or
foreign country in which the Employer maintains a branch office, or
conducts business (the "Restricted Territory"):
A. Enter into, engage in, be employed by, or consult with any
business in competition with the business of the Employer as it is
then carried on,
B. Sell to, market to, produce for, or otherwise deal with any
customer of the Employer.
(ii) Solicit any of the employees of the Employer to terminate their
employment;
(iii) Accept employment with or seek remuneration from any of the
clients or customers of the Employer with whom the Employer did business
during the term of the Employee's employment.
(b) The solicitation or acceptance of orders outside of any Restricted
Territory, for shipment to, delivery in, or service in any Restricted Territory,
shall also constitute engaging in business within the Restricted Territories in
violation of subparagraph (a)(i) of this paragraph.
(c) The restrictions of this paragraph 13 shall extend to any and all
business activities of the Employee, whether as an independent contractor,
partner or joint venturer, or as an officer, director, stockholder, agent,
employee or salesman for any person, firm, partnership, corporation or other
entity, or otherwise.
(d) The restrictions of this paragraph 13 shall not be violated by the
ownership of not more than two percent (2%) of the outstanding securities of any
company whose stock is traded on a national securities exchange or is quoted in
the Automated Quotation System of the National of Securities Dealers (NASDAQ).
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(e) The period of time during which the Employee is prohibited from
engaging in certain business practices pursuant to paragraph 13(a) shall be
extended by any length of time during which the Employee is in breach of such
covenants.
(f) It is understood, by and between the Employer and the Employee, that
the restrictive covenants set forth in this paragraph 13 are essential elements
of this Agreement, and that, but for the agreement of the Employee to comply
with such covenants, the Employer would not have agreed to enter into this
Agreement. Such covenants by the Employee shall be construed as agreements
independent of any other provision in this Agreement. The existence of any claim
or cause of action of the Employee against the Employer, whether predicated on
this Agreement, or otherwise, shall not constitute a defense to the enforcement
by the Employer of such covenants.
(g) It is agreed by the Employer and the Employee that, if any portion of
the covenants set forth in this paragraph 13 are held to be invalid,
unreasonable, arbitrary or against public policy, such portion of such covenants
shall be considered divisible both as to time and geographical area. The
Employer and Employee agree that, if any court of competent jurisdiction
determines the specified time period or the specified geographical area
applicable to this paragraph 13 to be invalid, unreasonable, arbitrary or
against public policy, a lesser time period or geographical area which is
determined to be reasonable, nonarbitrary and not against public policy may be
enforced against the Employee. The Employer and the Employee agree that the
foregoing covenants are appropriate and reasonable when considered in light of
the nature and extent of the business conducted by the Employer.
14. Specific Performance. The Employee agrees that damages at law will be an
insufficient remedy to the Employer, and that the Employer would suffer
Irreparable damage, if the Employee violates the terms of paragraphs 11, 12
and/or 13 of this Agreement. Accordingly, it is agreed that the Employer shall
be entitled, upon application to a court of competent jurisdiction, to obtain
injunctive relief to enforce the provisions of such Paragraphs, which injunctive
relief shall be in addition to any other rights or remedies available to the
Employer.
15. Compliance with other Agreements. The Employee represents and warrants that
the execution of this Agreement and performance of his obligations hereunder
will not conflict with, result in the breach of any provisions of or the
termination of or constitute a default under any agreement to which the Employee
is a party or by which the Employee is or may be bound.
16. Waiver or Breach. The waiver by the Employer of a breach of any of the
provisions of this Agreement by the Employee shall not be construed as a waiver
of any subsequent breach by the Employee.
17. Binding Effect; Assignment. The rights and obligations of the Employer under
this Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of the Employer. This Agreement is a personal employment
contract and the rights, obligations and interests of the Employee hereunder may
not be sold, assigned, transferred, pledged or hypothecated.
18. Entire Agreement. This Agreement and the option agreement containing the
terms and provisions of the Employee's Option contains the entire agreement and
supersedes all prior agreements and understandings, oral or written, with
respect to the subject matter hereof. This Agreement may
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be changed only by an agreement in writing signed by the party against whom any
waiver, change amendment, modification or discharge is sought.
19. Headings. The headings contained in this Agreement are for reference
purposes only and shall not affect the meaning or interpretation of this
Agreement.
20. Governing Law. This Agreement shall be construed and enforced in accordance
with the laws of the Stare of New Jersey.
21. Notices. Any notice required or permitted to be given under this Agreement
shall be sufficient if in writing and if sent by certified or registered mail,
first class, return receipt requested, to the parties at the following
addresses:
To the Employer: Biodynamics International, Inc.
0000 Xxxxx 00, Xxxxx 000
Xxxxxxxxxx, Xxx Xxxxxx 00000
To the Employee: Xxxxxx Xxxxxxxx
000 Xxxx Xxxxxx
Xxxxxxxxxx, X.X. 00000
IN WITNESS WHEREOF, the parties hereto have executed this Agreement this
30th day of March, 1998.
EMPLOYER:
BIODYNAMICS INTERNATIONAL, INC.
ATTEST
/s/ Xxxxxx Xxxxxx By: /s/ Xxxx X. Xxxxxxx
------------------------------ ------------------------------
Xxxx X. Xxxxxxx, President
EMPLOYEE:
Witnesses as to Employee:
/s/ Xxxxxx Xxxxxxxx
------------------------------ -----------------------------------
Xxxxxx Xxxxxxxx
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AMENDMENT
TO
EMPLOYMENT AGREEMENT
This amendment to an employment agreement date March 30, 1998 by and
between Tutogen Medical, Inc. (formerly Biodynamics International, Inc.) and
Xxxxxx Xxxxxxxx is hereby adopted this 18th day of December 1998.
Paragraph 10(e) is hereby amended in its entirety as follows:
(e) If the Employee's employment with the Employer is terminated pursuant
to paragraph 10(b) the Employer shall pay to the Employee any compensation
earned but not paid to the Employee prior to such termination. Such payment
shall be in full and complete discharge of any and all liabilities or
obligations of the Employer to the Employee hereunder, and the Employee shall be
entitled to no further benefits under this Agreement, except as otherwise
specifically provided in paragraph 3 of this Agreement. If the Employee's
employment with Employer is terminated by Employer for a reason other than as
set forth under paragraph 10(b) or by Employee pursuant to paragraph (d)(i) or
(iii), Employer will compensate Employee as severance pay the lesser of (i) six
month salary or (ii) remainder of the term of this Agreement. The severance will
be payable at the Employee's current base salary at time of termination, payable
in six equal installments over a three month period.
Notwithstanding anything to the contrary in the agreement, if Employee's
employment is terminated by Employer following a change of control of the
Company or Employee terminates his employment as a result of paragraph (d)(ii)
brought about by the change in control, Employer will compensate Employee as
severance pay 12 months salary. The severance will be payable at the Employee's
current base salary at time of termination, payable in six equal payments over a
six month period. Employee shall be entitled to receive medical benefits during
the six month period. If Employee's employment is terminated by Employer as
aforesaid or by Employee pursuant to paragraph (d)(ii), Employee agrees to
continue in the employ of the Employer for a period of no more than thirty days,
if needed, after the change of control to assist in any corporate transition.
EMPLOYER:
TUTOGEN MEDICAL, INC.
ATTEST:
/s/ Xxxx Xxxxxxx By: /s/ Xxxx Xxxxxxx
------------------------------ ------------------------------
Xxxx Xxxxxxx, President
EMPLOYEE:
Witness as to Employee:
/s/ Xxxxxx Xxxxxxxx
------------------------------- -----------------------------------
Xxxxxx Xxxxxxxx
