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Exhibit
10.2
Confidential Separation
Agreement and General Release and Amendment to
Confidentiality and
Non-Disclosure Agreement
This Confidential Separation
Agreement and General Release (hereafter “Agreement”)
is entered into by and between Orthovita Inc. (hereafter
“Orthovita” or “Company”), and Donald L.
Scanlan (hereafter “Employee”). As used in this
Agreement, “Company” shall include and encompass all of
the past, present, or future parent, affiliated, related and/or
subsidiary companies of Orthovita, and its past, present or future
directors, shareholders, officers, employees, agents, attorneys and
representatives.
EMPLOYEE and
ORTHOVITA agree to the following terms and conditions in
full and final settlement of all matters in any way relating to, or
arising out of, EMPLOYEE’s employment and/or separation from
employment with ORTHOVITA.
1. Employee’s final day
of employment with the Company will be Friday, June 15, 2007
(“Termination Date”), and Employee hereby resigns as of
such date.
2. Subject to
Employee’s execution and nonrevocation of this Agreement and
in consideration for Employee’s obligations and agreements
hereunder, the Company will:
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(a) |
pay Employee a total of $218,000.00, payable as salary
continuation for a period of 12 months, which is equivalent to 12
months of salary continuation at Employee’s current
semi-monthly salary of $9,083.33, minus all taxes and payroll
deductions authorized by law. These payments will commence with the
Company’s next payroll period following the June 15,
2007, Termination Date, provided that Employee has not revoked this
Agreement prior to the Effective Date (hereinafter defined) of the
Agreement. Amounts due under this paragraph 2(a) shall be payable
in semi-monthly installments in accordance with Orthovita’s
normal payroll cycle; |
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(b) |
If EMPLOYEE chooses to continue his group medical and dental
benefits under COBRA, ORTHOVITA will pay the COBRA premiums for
such medical/dental benefits through the twelve month period
following the Agreement Date; |
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(c) |
Orthovita will provide EMPLOYEE with a payment equal to any
reasonable unreimbursed business expenses through June 15,
2007 and any accrued, unused vacation days through the Agreement
Termination Date; and |
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(d) |
Orthovita acknowledges that Employee’s vested status in
Orthovita’s matching contributions to Employee’s John
Hancock 401(k) Retirement Account is 66% and such vested percentage
will remain intact, but that Employee’s plan account is
valued on a daily basis. |
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(e) |
amend Employee’s non-compete provisions as specified in
Section 3 herein below. |
3. The Company has elected to
enforce against Employee his non-compete obligations provided for
in Section 3 (a)—(d) of Employee’s Confidentiality
and Non-Disclosure Agreement with the Company dated 1 st of October 2004, attached hereto as
Exhibit A , incorporated by reference and made part hereof
in its entirety (“CDA”), provided that the Company and
Employee agree that this Agreement amends Section 3 and
Section 6 of the CDA, and except as explicitly stated herein,
all other provisions in the CDA remain in full force and effect.
Further, in the event that Employee breaches the non-compete
provisions of the CDA as modified hereby, the Company shall not be
obligated to make the payments in Section 2 above. In
consideration for the Company’s undertakings as described in
Section 2 herein and in accordance with the provisions of this
Section 3:
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(a) |
Employee agrees that upon execution of this Agreement, Employee
will return all Company equipment, Company documents and any other
Company property including all sales and marketing literature, in
Employee’s possession, custody or control. Such Company
property includes any Company equipment and materials in
Employee’s home; |
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(b) |
Employee agrees to abide by the following Non-Compete
Agreement: |
1) The “
Non-Compete Ending Date ” is June 15,
2008.
2) “ Competitive
Areas ” means bone grafting, surgical hemostasis,
treatment of vertebral compression fractures, and bioactive
structural interbody fusion spine spacer applications.
3) Commencing on the
Employee’s June 15, 2007, Termination Date of employment
with the Company, and continuing through and including the
Non-Compete Ending Date of June 15, 2008, (the “
Restriction Period ” ), Employee will not, without the
Company’s express prior written consent, directly or
indirectly own, manage, create, operate, sell, market, license,
join, control, finance or participate in the ownership, management,
operation, control or financing of, or be connected as an officer,
director, employee, partner, principal, agent, representative,
consultant or otherwise with, or use or permit his name to be used
in connection with, any person, business, firm, organization,
enterprise or entity that develops, designs, manufactures, sells,
licenses, markets or provides advice on any technologies, products
or products in development in the Competitive Areas (a
“Competing Business”), or sell or license to, or
develop for or with a Competing Business any technologies or
products in the Competitive Areas. Such products and technologies
include, without limitation, those products and technologies which
(i) the Company or any of its
divisions and/or subsidiaries or
affiliates has developed, manufactured, sold, licensed or marketed;
(ii) have been disclosed to Employee verbally or in writing
during the course of his employment, during any consulting
arrangement or as of the Termination Date as being in the process
of development, manufacturing, selling, licensing or marketing by
the Company, its divisions and/or its affiliates; and (iii) to
Employee’s knowledge, the Company may be in the process of
developing, manufacturing, selling, licensing or marketing now or
through the Restriction Period.
It is recognized by Employee
that the business of the Company, its divisions and/or its
affiliates and Employee’s connection therewith has been, is
or will be involved in activity throughout the world, and that more
limited geographical limitations on this non-competition covenant
are therefore not appropriate.
The foregoing restrictions
shall not be construed to prohibit the ownership by Employee of
less than one percent of any class of securities of any corporation
which is engaged in any of the foregoing businesses having a class
of securities registered pursuant to the Securities Exchange Act of
1934 (the “Exchange Act”), provided that such ownership
represents a passive investment and that neither Employee nor any
group of persons including Employee in any way, either directly or
indirectly, manages or exercises control of any such corporation,
guarantees any of its financial obligations, otherwise takes any
part in its business, other than exercising his rights as a
shareholder, or seeks to do any of the foregoing.
4. Employee on behalf of
himself and his successors, assigns, heirs and legal
representatives (“Releasors”), hereby voluntarily and
knowingly remises, releases, acquits and forever discharges the
Company and its representatives, its parent, affiliated and
subsidiary corporations, and its and their predecessors,
successors, affiliates, officers, directors, agents, assigns,
employees, attorneys, employee benefit plans, employee benefit plan
administrators, and employee benefit plan fiduciaries
(“Releasees”), from any and all claims, rights,
expenses, debts, demands, costs, contracts, liabilities,
obligations, actions, and causes of action of any nature, known or
unknown, based upon any fact, circumstance, or event occurring or
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