Exhibit 10.5
OSTEOTECH, INC.
AMENDMENT NO. 1 TO CHANGE IN CONTROL AGREEMENT
THIS AMENDMENT NO. 1 TO CHANGE IN CONTROL AGREEMENT is effective as of the 31st
day of December 2008 (the “Effective Date”) between OSTEOTECH, INC., a Delaware
corporation (the “Company”) and                      (the “Executive”).
WITNESSETH:
WHEREAS, the Company and the Executive have entered into that certain Change in
Control Agreement, effective as of                     (the “CIC Agreement”);
and
WHEREAS, the Company and the Executive now desire to amend the terms of the CIC
Agreement principally for the purpose of bringing it into compliance with the
requirements of section 409A of the Internal Revenue Code of 1986, as amended.
NOW, THEREFORE, in consideration of the mutual covenants and obligations
hereinafter set forth, the parties hereto agree as follows:
1. Section 2(a) of the CIC Agreement is hereby amended to read in full as
follows:

  (a)   Term of Employment. Commencing on the Commencement Date and ending on
the first anniversary of such date (the “Employment Period”), the Executive
hereby agrees to remain in the employ of the Company, and the Company hereby
agrees to continue the Executive in its employ, in accordance with and subject
to the terms and provisions of this Agreement in the capacity and with the same
responsibilities held immediately prior to the Commencement Date and such other
duties and responsibilities as are not inconsistent with the express terms of
this Agreement.

2. Section 4 of the CIC Agreement is hereby amended by adding thereto the
following:

  (d)   409A Payment Trigger. For the purpose of this Section 4, for the purpose
of paying all amounts subject to section 409A of the Internal Revenue Code and
for the purpose of qualifying for the exemption from 409A for separation pay due
to involuntary separation from service without cause (the so-called “2X
exception”), all references to termination of employment, terminate employment,
termination date and other derivatives of those words shall be construed and
applied to mean Separation From Service.

  (e)   409A Delay. Notwithstanding the foregoing, to the extent that any
payment due hereunder is: (i) deferred compensation subject to section 409A of
the Internal Revenue Code, and (ii) is payable to a specified employee (as that
term is defined in section 409A), and (iii) is payable when the Company is a
publicly traded company (as defined in section 409A), and (iv) is payable on
account of the specified employee’s Separation From Service, payment of any part
of such amount that would have been made during the six (6) months following the
Separation From Service shall not then be paid but shall rather be paid on the
first day of the seventh (7th) month following the Separation From Service.

 

 

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  (i)   Identifying Specified Employees. For this purpose, specified employees
shall be identified by the Company (I) on a basis consistent with regulations
issued under section 409A, and (II) as required by regulations issued under
section 409A, on a basis consistently applied to all plans, programs, contracts,
agreements, etc. maintained by the Company that are subject to section 409A.    
(ii)   Interpretation. It is expressly intended that, to the maximum extent
permitted by law, benefits under this Agreement shall be exempt from section
409A (e.g., medical and dental benefits provided under an insured plan). To the
extent that 409A is applicable to this Agreement, this Agreement shall be
construed and administered to comply with the rules of section 409A. Neither the
Company nor any of its officers, directors, agents or affiliates shall be
obligated, directly or indirectly, to the Executive or any other person for any
taxes, penalties, interest or like amounts that may be imposed on the Executive
or other person on account of any amounts under this Agreement or on account of
any failure to comply with any Code section.

  (f)   Separation From Service. As used in this Agreement, the term “Separation
From Service” (and derivatives of that phrase such as “Separates,” and
“Separated From Service”) shall mean a severance of the Executive’s employment
relationship with the Company and all affiliates, if any, for any reason other
than the Executive’s death, as determined subject to the following.

  (i)   Facts and Circumstances & 20% Rule. Whether a Separation From Service
has occurred is determined based on whether the facts and circumstances indicate
that the Company and Executive reasonably anticipated that no further services
would be performed after a certain date or that the level of bona fide services
the Executive would perform after such date (whether as an employee or as an
independent contractor) would permanently decrease to no more than twenty
percent (20%) of the average level of bona fide services performed (whether as
an employee or an independent contractor) over the immediately preceding thirty
six (36) month period (or the full period of services to the Company and all
affiliates if the Executive has been providing services to the Company and all
affiliates less than thirty six months). A transfer from employment with the
Company to employment with an affiliate of the Company shall not constitute a
Separation From Service. For this purpose “affiliate” shall be determined in
accordance with regulations issued under section 409A of the Internal Revenue
Code but using an eighty percent (80%) ownership test.

 

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  (ii)   Leaves of Absence. A Separation From Service shall not be deemed to
occur while the Executive is on military leave, sick leave or other bona fide
leave of absence if the period does not exceed six (6) months or, if longer, so
long as the Executive retains a right to reemployment with the Company or an
affiliate under an applicable statute or by contract. If the period of leave
exceeds six (6) months and the Executive does not retain a right to
reinstatement under an applicable statute or by contract, the Separation From
Service is deemed to occur on the first date immediately following the six month
period. For this purpose, a leave is bona fide only if, and so long as, there is
a reasonable expectation that the Executive will return to perform services for
the Company or an affiliate. Notwithstanding the foregoing, a twenty-nine
(29) month period of absence will be substituted for such six (6) month period
if the leave is due to any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last for a
continuous period of no less than six (6) months and that causes the Executive
to be unable to perform the duties of his or her position of employment.

3. Other than as set forth in this Amendment, all of the terms and conditions of
the CIC Agreement shall continue in full force and effect.
4. This Amendment shall be governed by and construed in accordance with the laws
of the State of New Jersey, without reference to the conflicts of laws of the
State of New Jersey or any other jurisdiction.

 

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IN WITNESS WHEREOF, the parties have duly executed this Amendment No. 1 to CIC
Agreement effective as of the date first above written.

              OSTEOTECH, INC.   EXECUTIVE:
 
           
By:
      By:    
 
           
Name:
  Sam Owusu-Akyaw   Name:    
Title:
  President and Chief Executive Officer   Title:    

 

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