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EXHIBIT
10.20
EMPLOYMENT
AGREEMENT
This Employment
Agreement (“Employment Agreement”) is made and entered
into by and between MiMedx, Inc. (the “Company”) and
Louise M. Focht (“Executive”) as of November 26,
2007 (the “Effective Date”).
1. Position and
Duties . Executive shall be employed by the Company as its
Senior Vice President, Extremities Orthopedics reporting to the
Company’s President. Executive agrees to devote at least
forty (40) hours per week of her business time, energy and
skill to her duties at the Company. These duties shall include all
those duties customarily performed by the Senior Vice President,
Extremities Orthopedics, and the Executive’s services shall
be performed primarily out of the Executive’s home office and
the Company’s offices located within 30 miles from the
Executive’s residence.
2. Term of
Employment : Executive’s employment as an employee of the
Company will be for a one-year term, renewable for consecutive
one-year terms upon mutual agreement of the parties. However,
subject to the terms and conditions hereof, such employment may be
terminated by Executive or the Company at any time, with or without
good reason. Upon the termination of Executive’s employment
as an employee of the Company, for any reason, neither Executive
nor the Company shall have any further obligation or liability
under this Employment Agreement to the other, except for the
accrued rights of the Executive hereunder and as set forth in this
paragraph and paragraphs 6 and 7 below.
3.
Compensation/Base Salary : Executive shall be paid a monthly
Base Salary of 14,583.00 per month ($175,000 on an annualized
basis), subject to applicable withholding, in accordance with the
Company’s normal payroll procedures. Executive’s salary
shall be reviewed for an increase on at least an annual basis. In
the event of such an increase, that increased amount shall become
Executive’s new Base Salary. The parties acknowledge that
Executive will be eligible as additional compensation of up to 20%
of the Base Salary if certain MiMedx objectives are achieved. Such
Objectives and metrics to be mutually agreed upon and the
achievement of those objectives shall be determined by the
Company’s Board of Directors.
4. Benefits:
Executive shall have the right to participate in and to receive
benefits under any of the Company’s employee benefit plans,
as such plans may be modified from time to time. In addition,
Executive shall be entitled to the benefits afforded to other
members of senior management. Executive shall be entitled to four
weeks paid vacation per year.
5. Stock :
Executive shall receive 150,000 stock options to purchase shares of
the Company’s common stock at an exercise price of $2.40 per
share upon approval by the Board of Directors. Such options shall
vest 25% immediately and 25% on each anniversary of the option
grant. Such options shall fully vest on a Change of Control, as
subsequently defined.
6. Benefits Upon
Termination : In the event that Executive’s voluntary
chooses to terminate her employment with the Company, or in the
event that Executive’s employment terminates as a result of
her death, Executive shall be entitled to no continuing
compensation or benefits from the Company other than those earned
under paragraph 3 above through the date of
her termination, or in the
case of any stock options, those options vested through the date of
her termination.
7. Benefits Upon
Other Termination . Executive agrees that her employment may be
terminated by the Company at any time, with or without good reason.
In the event of the termination of Executive’s employment by
the Company for the reasons set forth below, she shall be entitled
to the following:
(a) Termination
for Good Reason : If Executive’s employment is terminated
by the Company for good reason as defined below, Executive shall be
entitled to no compensation or benefits from the Company other than
those earned under paragraph 3, or in the case of any stock
options, those options vested through the date of her
termination.
For purposes of
this Employment Agreement, a termination “for good
reason” occurs if Executive is terminated for any of the
following reasons:
(i) theft,
dishonesty, or falsification of any employment or Company
records;
(ii) conviction of
a felony or any act involving moral turpitude;
(iii) consistent
poor performance, as determined by the Board in its sole
discretion;
(iv) improper
disclosure of the Company’s confidential or proprietary
information;
(v) any intentional
act by Executive that has a material detrimental effect on the
Company’s reputation or business; or
(vi) any material
breach of this Employment Agreement, which breach, if curable, is
not cured within thirty (30) days following written notice of
such breach from the Company.
(b) Termination
Without Good Reason : If the Company requires the Executive to
be based at any office or location other than that which the
Executive initially is employed at within thirty days of this
Employment Agreement, except for travel reasonably required in the
performance of the Executive’s responsibilities consistent
with practices in effect prior to the Effective Date, this shall,
at the sole election of Executive, constitute termination without
good reason. Moreover, if Executive’s employment is
terminated by the Company following the Effective Date for any
reason other than for good reason, Executive shall be entitled to
the following separation benefits:
(i) all accrued
compensation and benefits through the date of termination including
any stock option grants that have vested through that date;
and
(ii) continued
payment of Executive’s salary at her Base Salary rate
together with applicable fringe benefits (including any COBRA
expense) as provided to other executive
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employees, less applicable
withholding, until the greater of either (x) the end of the
Term of Employment as set forth in this Employment Agreement or
(y) six months.
(c) Change of
Control : In the event the Executive’s employment is
terminated during the term hereof by either the Executive or the
Company (other than for good reason) after the occurrence of a
“Change of Control”, such termination shall be deemed
to be a termination without good reason. For the purposes of this
Employment Agreement a “Change of Control” shall be
deemed to occur upon any of the following: (x) the
acquisition, directly or indirectly, following the Effective Date
by any person (as such term is defined in Section 13(d) and
14(d)(2) of the Securities Exchange Act of 1934, as amended), in
one transaction or a series of related transactions, of securities
of the Company representing in excess of fifty percent
(50%) or more of the combined voting power of the
Company’s then outstanding securities if such person or his
or its affiliate(s) do not own in excess of 50% of such voting
power on the Effective Date, or (y) the date of the closing of
a disposition by the Company (whether direct or indirect, by sale
of assets or stock, merger, consolidation or otherwise) of all or
substantially all of its business and/or assets in one transaction
or series of related transactions, where the Company an affiliate
of the Company or a control person of the Company immediately prior
to the transaction(s) in question is not the controlling entity or
person after such transaction(s).
Notwithstanding the foregoing, a Change in Control shall not be
deemed to have occurred in the event the Company forms a holding
company as a result of which the holders of the Company’s
voting securities immediately prior to the transaction hold, in
approximately the same relative proportions as they hold prior to
the transaction, substantially all of the voting securities of a
holding company owning all of the Company’s voting securities
after the completion of the transaction.
A Change in
Control shall not be deemed to have occurred as a result of an
initial public offering of the common stock of the Company, or the
creation or development of a public market for the shares of common
stock of the Company through a “reverse merger” into a
public company or other similar transaction.
8. Employee
Inventions and Proprietary Rights Assignment Agreement :
Executive agrees to execute and abide by the terms and conditions
of an Employee Invention Assignment and Confidentiality Agreement
with the Company, which shall not be materially different from the
form attached as Exhibit A hereto.
9. Agreement Not
To Compete Unfairly : Employee agrees that in the event of her
termination at any time and for any reason, she shall not compete
with the Company in any unfair manner, including, without
limitation, using any confidential or proprietary information of
the Company to compete with the Company in any way.
10. Dispute
Resolution : In the event of any dispute or claim relating to
or arising out of this Employment Agreement (including, but not
limited to, any claims of breach of contract, wrongful termination
or age, sex, race or other discrimination), Employee and the
Company agree that all such disputes shall be fully and finally
resolved by binding arbitration conducted by the American
Arbitration Association in San Diego, California in accordance with
its National Employment Dispute Resolution rules, as those rules
are currently in effect (and not as
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they may be modified in the
future). Employee acknowledges that by accepting this arbitration
provision she is waiving any right to a jury trial in the event of
such dispute. Provided, however, that this arbitration provision
shall not apply to any disputes or claims relating to or arising
out of the misuse or misappropriation of trade secrets or
proprietary information.
11.
Interpretation : Executive and the Company agree that this
Employment Agreement shall be interpreted in accordance with and
governed by the laws of the State of California.
12. Successors
and Assigns : This Employment Agreement shall inure to the
benefit of and be binding upon the Company and its successors and
assigns. In view of the personal na
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