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Exhibit 10.1

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2014 Management Incentive Plan (MIP)
 

I. Purpose

The 2014 MIP is designed to provide an incentive for key members of the MiMedx
Group, Inc. (MiMedx or Company) management team to exceed the 2014 Business Plan
and reward those management team members with deserving performance.

The goals of the 2014 MIP are:
 

1. To increase shareholder value.

 

2. To achieve and exceed the 2014 Business Plan for Consolidated MiMedx and each
Division of the Company.

 

3. To reward key individuals for demonstrated performance that is sustained
throughout the year.

 

4. To enhance the Company’s ability to be competitive in the marketplace for
executive talent and attract, retain and motivate a high-performing and
high-potential management team.

II. MIP Program Period

This program is in effect from January 1, 2014 through December 31, 2014.  The
program is subject to adjustment by the Company at any time during or after the
program period.  In the event of a program adjustment, an addendum will be
published to inform eligible participants.

III. MIP Participation and Eligibility

Participation and eligibility are determined by the MIP Compensation Committee
at its sole discretion.  No individual is automatically included in the MiMedx
2014 MIP.  Only those individuals approved by the Compensation Committee and
confirmed in writing are eligible.  Verbal comments or promises to any employee
or past practices are not binding on MiMedx or any of its divisions or
subsidiaries in any manner.

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Terminated Employees:  If a participant terminates from the Company, the
following guidelines will be used for all voluntary or involuntary terminations
as well as terminations due to a Reduction in Force:  Incentives are only earned
by employees in good standing on the date payment is made.  Participants
terminating employment prior to the date of payment are not eligible for any
incentive payment, regardless of the reason for termination of employment.

First Time Participants:  New management employees hired or promoted into an
eligible position will be able to begin participating in the MIP on the first
day of the first full month in the eligible position.  The Base Bonus will be
prorated based on the number of months employed in the eligible position.  No
incentives will be earned or paid for new hires beginning employment after
September 30, 2014.

Existing Participants:  Participants who transfer during the period January 1,
2014 through December 31, 2014 from one MIP eligible position to another MIP
eligible position, having either a higher or lower Base Bonus, will begin
participating at the new MIP level on the first day of the first full month in
the new position.  The participant’s Base Bonus will be prorated for the months
employed in each eligible position.

Leave of Absence:  Participants who have been on an approved leave of absence
for medical or other reasons for greater than 60 cumulative days during the year
will receive a prorated portion of their earned Base Bonus.  The earned Base
Bonus for participants on approved leaves of absence of less than 60 cumulative
days will not be prorated based on the period of approved leave.  Participants
who have been on an approved leave of absence for medical or other reasons for
greater than 120 cumulative days during the year will not be eligible to earn
any amount of MIP for the year.

II. MIP Administration

The Executive Compensation Committee will be responsible for the methods of
calculation and administration of the Plan.  The Executive Compensation
Committee will be comprised of the Chairman & CEO; President & Chief Operating
Officer; Chief Financial Officer; and Vice President Human Resources &
Administration.

The Company may change the plan from time to time in any respect.  All decisions
made on behalf of the Company by the MiMedx Board of Directors or the Executive
Compensation Committee relative to the plan are final and binding.  The
determination of compliance with the individual objectives established under the
plan for an employee shall be made by the Executive Compensation Committee in
its sole discretion.

V. MIP Incentive Determination and Payment

The 2014 MIP provides for the determination of a Base Bonus expressed as a
percentage of the participant’s annual salary in effect at the end of the
program period or the end of each respective period when a participant transfers
from one MIP eligible position to another.

Participants approved for MIP participation as of January 1, 2014 are eligible
for a full year’s participation not subject to proration.  All incentives earned
under the MIP will be measured and paid annually.
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Earned incentives are paid primarily in the form of cash compensation. However,
at the sole discretion of the MiMedx Board of Directors, payment of earned
incentives may be made in the form of equivalent value stock options and/or
restricted stock, provided the total amount of the earned incentive paid in the
form of cash compensation is no less than fifty percent (50%) of the total
earned incentive amount.

VI. MIP Participants

  The 2014 MIP participants include the CEO, plus the direct reports to the CEO.

VII. MIP Method of Calculation

Each participant’s incentive will be calculated based on the achievement of a
financial target and individual objectives.  Base bonus for all MIP participants
is divided into a two financial components. 90% of the base bonus is allocated
to 2014 Revenue performance and 10% is allocated to 2014 MiMedx Earnings Before
Interest, Taxes, Depreciation, Amortization and Share Based Compensation Expense
(“MiMedx EBITDA”) performance.

The financial thresholds for 2014 Revenue and 2014 MiMedx EBITDA indicate the
level of respective performance where partial payouts commence. Increased
partial payouts are indicated for respective 2014 Revenue and 2014 MiMedx EBITDA
Performance above the financial threshold and below the financial target. The
respective 2014 Revenue and 2014 MiMedx EBITDA targets indicate the point at
which the respective target base bonuses are earned.  Provided a minimum MiMedx
EBITDA Floor is achieved, each partial payout threshold and target base bonus
payout is determined independent of the other. For purposes of calculating the
earned amount of MIP allocated to MiMedx EBITDA performance and Revenue
performance, the total Base Bonuses of all eligible participants is referred to
as the Base Bonus Pool. Based on the MiMedx EBITDA performance (specific to
MiMedx EBITDA performance at 6 designated Levels) and MiMedx Revenue performance
(specific to revenue performance at 12 designated Levels), the MIP is calculated
as follows:
 
EBITDA Performance
 

o MiMedx EBITDA < Level 1 = no incentive earned for MiMedx EBITDA component.

o MiMedx EBITDA at Level 1 = 10% of MiMedx EBITDA component funded.

o MiMedx EBITDA at Level 2 = 25% of MiMedx EBITDA component funded.

o MiMedx EBITDA at Level 3 = 50% of MiMedx EBITDA component funded.

o MiMedx EBITDA at Level 4 = 75% of MiMedx EBITDA component funded.

o MiMedx EBITDA at Level 5 = 90% of MiMedx EBITDA component funded.

o MiMedx EBITDA at Level 6 = 100% of MiMedx EBITDA component funded.

o MiMedx EBITDA > Level 6 = 100% of MiMedx EBITDA component funded. Excess Bonus
Pool funded based upon Revenue performance greater than 100% of revenue target
as described below.

 
Revenue Performance

o Revenue < Level 1 = no incentive earned for Revenue component.

o Revenue at Level 1 = 15% of Revenue.

o Revenue at Level 2 = 40% of Revenue.

o Revenue at Level 3 = 60% of Revenue.

o Revenue at Level 4 = 80% of Revenue.

o Revenue at Level 5 = 95% of Revenue.

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o Revenue at Level 6 = 100% of Revenue.

o Revenue at Level 7 = 110% of Revenue and EBITDA funded.

o Revenue at Level 8 = 125% of Revenue and EBITDA funded.

o Revenue at Level 9 = 140% of Revenue and EBITDA funded.

o Revenue at Level 10 = 160% of Revenue and EBITDA funded.

o Revenue at Level 11 = 190% of Revenue and EBITDA funded.

o Revenue at Level 12 = 200% of Revenue and EBITDA funded. The maximum MIP
amount is limited to two (2) times the participant’s Base Bonus.

Financial Gatekeeper: MiMedx EBITDA component is a gatekeeper for the Revenue
component. If Gross MiMedx EBITDA (before the respective Revenue payout)
performance is unfavorable to the MiMedx EBITDA Floor, no payout for Revenue
performance can be made. If Gross MiMedx EBITDA performance is favorable to the
MiMedx EBITDA Floor, the Revenue component is paid out independent of and in
addition to the EBITDA component.

VIII. MIP Excess Bonus or Other Amounts

Following the funding of all Base Bonuses, if MiMedx Revenue performance is
greater than 100% of the Revenue Target (Level 6), the participant may earn an
Excess Bonus. The excess bonus is earned at the above designated percentage of
the Revenue component and the EBITDA component (levels 7 through 12). An Excess
Bonus Pool will be funded not to exceed two (2) times the total of all Base
Bonus amounts.

As determined by the MiMedx Board of Directors in its sole discretion, a
participant may be eligible to earn a portion of the participant’s Base Bonus
allocated to MiMedx EBITDA performance that may exceed the amount as calculated
above provided the MiMedx EBITDA performance is favorable to the specified
MiMedx EBITDA Floor.

IX. MIP and OIP Miscellaneous

Nothing in the MIP shall be deemed to constitute a contract for the continuance
of employment of the participants or bring about a change of status of
employment.  Neither the action of the Company in establishing this program, nor
any provisions hereof, nor any action taken by the Company shall be construed as
giving any employee the right to be retained in the employ of the Company for
any period of time, or to be employed in any particular position, or at any
particular rate of remuneration.

Further, nothing contained herein shall in any manner inhibit the day-to-day
conduct of the business of the Company and its subsidiaries, which shall remain
within the sole discretion of management of the Company; nor shall any
requirements imposed by management or resulting from the conduct of the business
of the Company constitute an excuse for, or waiver from, compliance with any
goal established under this plan.

No persons shall have any right, vested or contingent, or any claim whatsoever,
to be granted any award or receive any payment hereunder, except payments of
awards determined and payable in accordance with the specific provisions hereof
or pursuant to a specific and properly approved agreement regarding the granting
or payment of an award to a designated individual.
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Neither this program, nor any payments pursuant to this program, shall affect,
or have any application to, any of the Company’s life insurance, disability
insurance, PTO, medical or other related benefit plans, whether contributory or
non-contributory on the part of the employee except as may be specifically
provided by the terms of the benefit plan.

All payments pursuant to this program are in gross amounts less applicable
withholdings.

MiMedx reserves the right to apply a participant’s incentive payment against any
outstanding obligations owing to the Company.
 
 
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