Exhibit
10.21


 


SEVERANCE AGREEMENT


 


THIS SEVERANCE AGREEMENT (the “Agreement”) is made
this 30th day of August 2010 by and among BioHorizons Implant Systems, Inc.,
its parent BioHorizons, Inc. (together, the “Company”), and J. Todd Strong
(the “Employee”).


 


WHEREAS, in consideration of the mutual covenants and
promises contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the parties hereto,
the parties agree as follows:


 


1.                                      EFFECT OF TERMINATION OF EMPLOYMENT


 


1.1                               In the event that the Company
terminates the Employee’s employment other than for “Cause” as defined in Section 1.2,
or the Employee resigns for “Good Reason” as defined in Section 1.3
(regardless of whether such termination or resignation, as applicable, occurs
in the context of a “change in control” of the Company), the Employee executes
and does not revoke a full release of claims (the “Release”) in the form and of
a scope reasonably acceptable to the Company within sixty (60) days following
the effective date of the termination (the “Termination Date”), the Release
becomes binding and irrevocable at that time, and the Employee does not breach
any provision of this Agreement, the Company shall, commencing on the sixtieth
(60th) day following the Termination Date: (a) pay to the Employee the
Employee’s then-current base salary for a period of nine (9) months in
accordance with the Company’s regular payroll practices, and (b) if the
Employee exercises his right under the Consolidated Omnibus Budget
Reconciliation Act of 1986 (“COBRA”) to continue participation in the Company’s
health insurance plan, the Company shall pay its normal share of the costs for
such coverage for a period of nine (9) months (retroactive to the
Termination Date) to the same extent that such insurance is provided to persons
then currently employed by the Company (the Employee’s co-pay, if any, shall be
deducted from the payments described in subsection (a) or, if no such
payments remain to be paid, shall be paid directly to the Company within seven (7) days
of receipt of notice of such payment due).


 


1.2                               For the purposes of Section 1,
“Cause” for termination shall be deemed to exist upon the occurrence of any of
the following:


 


(a)                                  A good faith finding by the Board
of Directors or a Committee appointed thereby that the Employee has engaged in
dishonesty, gross negligence or gross misconduct which if curable, has not been
cured by the Employee within 30 days after he has received written notice from
the Company stating with reasonable specificity the nature of such conduct;


 


(b)                                  Willful misconduct by the Employee
that materially injures the Company, whether such harm is economic or
non-economic, including, but not limited to, injury to the Company’s business
or reputation;


 


(c)                                  The Employee’s conviction or entry
of nolo contendere to any felony or crime involving moral turpitude, fraud or
embezzlement;


 

















 


(d)                                  The Employee’s failure to perform
the functions assigned to him by his direct supervisor, or the CEO, or the
Board of Directors; or


 


(e)                                  The Employee’s material breach of
this Agreement, including but not limited to Section 3, including all
subparts, hereof.


 


1.3                               For the purposes of Section 1,
a resignation by the Employee for “Good Reason” shall be deemed to exist upon
the occurrence of any of the following:


 


(a)                                  The Company materially diminished
the Employee’s base salary;


 


(b)                                  The Company materially diminished
the Employee’s authority, duties or responsibilities of the Employee as of the
date hereof; or


 


(c)                                  The Company required the Employee
to relocate permanently to an office more than fifty 50 miles from the Company’s
offices at which he performed services as of the date he commenced employment
with the Company.


 


Notwithstanding
the foregoing, the foregoing occurrences shall not constitute Good Reason
unless the Company has failed to cure the acts or omissions giving rise to
resignation by the Employee for Good Reason within thirty (30) days of
receiving written notice (the “Good Reason Notice”) from the Employee stating
his intent to resign his employment for Good Reason and specifying the Company’s
acts or omissions giving rise to Good Reason, and the Employee has provided the
Good Reason Notice to the Company within ninety (90) days of the dates the acts
or omissions giving rise to Good Reason first arose.  The Employee’s resignation for Good Reason
shall become effective on the thirty-first (31st) day following the date the
Company receives the Good Reason Notice.


 


1.4                               The covenants set forth in
Sections 3 and 4, including all subparts, shall survive the termination of the
Employee’s employment.


 


2.                                      SEPARATION FROM SERVICE


 


2.1                               The payment provided for in Section 1.1
is intended to be an involuntary separation pay plan, with respect to a
termination without Cause and resignation for Good Reason, pursuant to Treas.
Reg. §1.409A-1(b)(9)(iii), and thus not “nonqualified deferred compensation”
subject to Section 409A of the Code. 
The following interpretations apply to Section 1.1 for any other
termination of employment, or if Section 1.1 is deemed to provide benefits
that are deemed to be “nonqualified deferred compensation” with respect to a
termination without Cause or resignation for Good Reason.  Any termination of the Employee’s employment
under Section 1.1 of this Agreement triggering payment of benefits must
constitute a “separation from service” under Section 409A(a)(2)(A)(i) of
the Code and Treas. Reg. §1.409A-1(h) before distribution of such benefits
can commence.  To the extent that the
termination of the Employee’s employment does not constitute a separation of
service under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg.
§1.409A-1(h) (as the result of further services that are reasonably
anticipated to be provided by the Employee to the Company at the time the
Employee’s employment terminates), any benefits payable under Section 1.1
that constitute deferred compensation under Section 409A of the Code shall
be delayed until after the 


 


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date of a
subsequent event constituting a separation of service under Section 409A(a)(2)(A)(i) of
the Code and Treas. Reg. §1.409A-1(h). 
For purposes of clarification, this Section shall not cause any
forfeiture of benefits on the Employee’s part, but shall only act as a delay
until such time as a “separation from service” occurs.  Further, if the Employee is a “specified
employee” (as that term is used in Section 409A of the Code and
regulations and other guidance issued thereunder) on the Termination Date and the
payment of the amounts described in Section 1.1 constitute non-qualified
deferred compensation, the payment of which would result in penalties under Section 409A
of the Code, then such payment shall be delayed until the business day
following the six-month anniversary of the Termination Date, but only to the
extent necessary to avoid such penalties under Section 409A of the
Code.  On the business day following the
six-month anniversary of the Termination Date, the Company shall pay the
Employee in a lump sum the aggregate value of the non-qualified deferred
compensation that the Company otherwise would have paid the Employee prior to
that date under Section 1.1 of this Agreement.  It is intended that each installment of the
payments and benefits provided under Section 1.1 of this Agreement shall
be treated as a separate “payment” for purposes of Section 409A of the
Code.  Neither the Company nor the
Employee shall have the right to accelerate or defer the delivery of any such
payments or benefits except to the extent specifically permitted or required by
Section 409A of the Code.


 


3.                                      PROTECTED INFORMATION, NONDISCLOSURE AND
NONCOMPETITION


 


3.1                               Definition of Protected Information


 


(a)                                  For purposes of this Agreement,
the term “Protected Information” shall mean all of the following materials and
information (whether or not reduced to writing and whether or not patentable or
protectable by copyright) which the Employee receives, receives access to,
created, conceived or developed, in whole or in part, directly or indirectly,
alone or with others and whether or not conceived or developed during regular
business hours, in connection with his employment with the Company or in the
course of his employment with the Company (in any capacity, whether executive,
managerial, planning, technical, sales, research, development, manufacturing,
Engineering, or otherwise), or through the use of any of the Company’s
facilities or resources:


 


(i)                                    Production
processes, marketing techniques and arrangements, mailing lists, purchasing
information, pricing policies, quoting procedures, financial information,
customer, client and prospect names and requirements, employee, customer,
supplier and distributor data and other materials or information relating to
the Company’s business and activities and the manner in which the Company does
business;


 


(ii)                                Discoveries,
concepts, plans and ideas including, without limitation, the nature and results
of research and development activities, processes, formulas, inventions, dental
implant related materials, equipment or technology, programs, systems, manuals,
reports, drafts, techniques, “know-how,” designs, drawings and specifications;


 


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(iii)                            Any
other materials or information related to the business or activities of the
Company which are not generally known to others engaged in similar businesses
or activities;


 


(iv)                               Any
information and materials received by the Company from third parties in
confidence (or subject to non-disclosure or similar covenants); and


 


(v)                                   All
ideas which are derived from or relate to the Employee’s access to or knowledge
of any of the above enumerated materials and information.


 


(b)                                  Failure to mark any of the
Protected Information as confidential, proprietary or Protected Information
shall not affect its status as part of the Protected Information under the
terms of this Agreement.


 


(c)                                  For purposes of this Agreement,
the term “Protected Information” shall not include information which is or
becomes publicly available without breach of (i) this Agreement, (ii) any
other agreement or instrument to which the Company is a party, or a beneficiary
or (iii) any duty owed to the Company by the Employee or any third party;
provided, however, that the Employee hereby acknowledges and agrees that,
except as otherwise provided in Section 3.2 hereof, if the Employee shall
seek to disclose, divulge, reveal, report, publish, transfer or use, for any
purpose whatsoever, any Protected Information, he shall have the burden of
proving that any such information shall have become publicly available without
any such breach.


 


3.2                               Ownership of Information


 


The
Employee covenants and agrees that all right, title and interest in any
Protected Information shall be and shall remain the exclusive property of the
Company (or third party, as the case may be) and, to the maximum extent
permitted by applicable law, shall be deemed “works made for hire” as the term
is used in the United States Copyright Act; provided, however, that the
foregoing shall not apply to any invention for which no equipment, supplies,
facility, or Protected Information of the Company was used, which was developed
entirely on the Employee’s own time, and which does not (i) relate to the
business of the Company, (ii) relate to the Company’s actual or
demonstrably anticipated research or development or (iii) result from any
work performed by the Employee for the Company. 
The Employee agrees to disclose immediately to the Company all Protected
Information developed in whole or in part by the Employee during the term of
the Employee’s employment with the Company and to assign to the Company any
right, title or interest he may have in such Protected Information.  The Employee agrees to execute any
instruments and to do all other things reasonably requested by the Company
(both during and after the Employee’s employment with the Company) in order to
secure the Company’s rights in the Protected Information, including obtaining a
patent, registering a copyright, or otherwise (and I hereby irrevocably appoint
the Company and any of its officers as my attorney in fact to undertake such
acts in my name).  Employee agrees that
his obligation to execute written instruments and otherwise assist the Company
in 


 


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securing
its rights in the Protected Information will continue after the termination of
his employment for any reason.


 


3.3                               Covenants Not to Solicit or Hire Employees


 


It
is recognized and understood by the Company and the Employee that the employees
of the Company are an integral part of its business and that it is extremely
important for the Company to use its maximum efforts to prevent it from losing
such employees.  It is therefore
understood and agreed by both parties that, because of the nature of the
Company’s business, it is necessary to afford fair protection to the Company
from the loss of such employees. 
Consequently, as a material inducement to the Company to enter into this
Agreement and to continue to employ the Employee, the Employee covenants and
agrees that, for the period commencing on the date of Employee’s termination of
employment for any reason whatsoever and ending one (1) year after the
Employee’s termination of employment with the Company, the Employee shall not,
directly or indirectly, hire or engage or attempt to hire or engage, or
communicate for business purposes with any individual who shall have been an
employee of the Company at any time during the one (1) year period prior
to the date of the Employee’s termination of employment with the Company,
whether for or on behalf of the Company or for any entity in which the Employee
shall have a direct or indirect interest (or any subsidiary or affiliate of any
such entity), whether as a proprietor, partner, co-venturer, financier,
investor, or stockholder, director, officer, employer, employee, servant,
agent, representative, or otherwise.


 


3.4                               Non-competition and Non-solicitation


 


(a)                                  The parties acknowledge that as
prime consideration for the obligations of the Company hereunder, the Employee
has agreed and represented that for and during the duration of his employment,
and during a period of one (1) year from the date of his termination of
employment for any reason whatsoever, he will not directly or indirectly:


 


(i)                                    Provide
services to, own, manage, operate, control or participate in the ownership,
management or control of, or be connected as an officer, employee, partner,
director, or otherwise with, or have any financial interest in, or aid or
assist anyone else in the conduct of, any entity or business (existing on the
date that Employee’s employment with the Company terminates and/or during the
one-year period thereafter) that is or has current plans to be in competition
with the Company or any of its subsidiaries or affiliates within any area in
which the Company conducts its business on the date that Employee’s employment
with the Company terminates. 
Notwithstanding the foregoing, Employee’s ownership of securities of a
public company engaged in competition with the Company not in excess of two
percent (2%) of any class of such securities shall not be considered a breach
of the covenants set forth herein; or


 


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(ii)                                Contact,
call upon, communicate, solicit or sell or attempt to contact, call upon,
communicate, solicit or sell any services or products which are provided by or
dealt in by, the Company to any of the present customers of the Company, to any
past customers of the Company who were customers during the period of the
Employee’s employment or to any prospective customers of the Company’s whom the
Employee solicited during the period of his employment.  It is the intent of the Employee and the
Company to preserve the exclusivity of the Company’s customer relations, special
knowledge, trade secrets and experience gained or to be gained in the future by
the Employee during his association with the Company, recognizing that if such
customer relations, experience, knowledge and trade secrets were made available
to competitors of the Company, it would irreparably damage the Company’s
business.


 


3.5                               Tolling


 


If
the Employee violates the restrictions set out in Sections 3.3 and 3.4, the
period during which the prohibitions set forth therein shall apply shall be
extended one (1) day for each day in which a violation occurs, and if suit
is brought to enforce the Company’s rights under Sections 3.3 or 3.4, and the
Company establishes one or more violations by the Employee, the Company shall
be entitled to an injunction restraining the Employee from further violations
for a period of one (1) year from the date of the final decree less only
such number of days that the Employee has not violated the covenants set forth
in Sections 3.3 or 3.4.


 


3.6                               Injunctive Relief, Damages and Attorneys’
Fees


 


The
Employee understands and agrees that the Company shall suffer irreparable harm
in the event that the Employee breaches any of his obligations under this
Agreement and that monetary damages shall be inadequate to compensate the
Company for such breach.  Accordingly,
the Employee agrees that, in the event of a breach or threatened breach by the
Employee of any of the provisions of this Agreement, the Company, in addition
to and not in limitation of any other rights, remedies or damages available to
the Company at law or in equity, shall be entitled to a temporary restraining
order, preliminary injunction and permanent injunction in order to prevent or
to restrain any such breach by the Employee, or by any or all of the Employee’s
partners, co-venturers, employers, employees, servants, agents, representatives
and any and all persons directly or indirectly acting for, on behalf or with
the Employee.  The Employee further
agrees that, in the event he breaches or threatens to breach of any of the
provisions of this Agreement, the Company shall be entitled to recover all
costs, including a reasonable attorney’s fee, incurred in enforcing or
attempting to enforce this Agreement.


 


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3.7                               Materials


 


All
notes, data, tapes, reference items, sketches, drawings, memoranda, records,
and other materials in any way relating to any of the Protected Information or
to the Company’s business shall belong exclusively to the Company and the
Employee agrees to turn over to the Company all copies of such materials in the
Employee’s possession or under the Employee’s control at the request of the
Company or, in the absence of such a request, within three business days of the
termination of Employee’s employment with the Company.


 


3.8                               Accounting for Profits; Indemnification


 


The
Employee covenants and agrees that, if he shall violate any of his covenants or
agreements under this Agreement, the Company shall be entitled to an accounting
and repayment of all profits, compensation, royalties, commissions,
remunerations or benefits which the Employee directly or indirectly shall have
realized or may realize relating to, growing out of or in connection with any
such violation; such remedy shall he in addition to and not in limitation of
any injunctive relief or other rights or remedies to which employer is or may
be entitled at law or in equity or otherwise under this Agreement.  The Employee hereby agrees to defend,
indemnify and hold harmless the Company against and in respect of, (i) any
and all losses and damages resulting from, of any warranty, covenant or
agreement made or contained in this Agreement; and (ii) any and all
actions, suits, proceedings, claims, demands, judgments, costs and expenses
(including reasonable attorneys’ fees) incident to the foregoing.


 


4.                                      REASONABLENESS OF RESTRICTIONS;
SEVERABILITY


 


4.1                               EMPLOYEE HAS CAREFULLY READ AND
CONSIDERED THE PROVISIONS OF SECTION 3, INCLUDING ALL SUBPARTS, AND HAVING
DONE SO, AGREES THAT THE RESTRICTIONS SET FORTH IN SUCH SECTION ARE FAIR AND
REASONABLE AND ARE REASONABLY REQUIRED FOR THE PROTECTION OF THE INTERESTS OF
THE COMPANY AND ITS BUSINESS, OFFICERS, DIRECTORS, AND EMPLOYEES.  The Employee further agrees that the
restrictions set forth in this Agreement shall not impair his ability to secure
employment within the field or fields of his choice including, without
limitation.  those areas in which the
Employee is, is to be or has been employed by the Company.


 


4.2                               It is the intent of the parties to
enter into a reasonable-competition agreement, among other things, for the
maximum period and the maximum extent enforceable under the laws of the State
of Alabama, including, without limitation, Section 8-1-1 of the Alabama
Code, and if its said geographic or temporal restrictions should be deemed
unreasonable by a court of competent jurisdiction, the parties intend that such
court should, in light of the facts and circumstances, reform this Agreement
specifying the maximum permissible scope (in time, location and subject
matter).


 


4.3                               The provisions of this Agreement
shall be deemed severable and shall be construed to the fullest extent
allowable under the applicable law.  The
invalidity or 


 


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unenforceability of any one or more of the provisions hereof shall not
affect the validity and enforceability of the other provisions hereof.  The Employee agrees that the breach or
alleged breach by the Company of (i) any covenant contained in another
agreement (if any) between the Company and the Employee or (ii) any
obligation owed to the Employee by the Company, shall not affect the validity
or enforceability of the covenants and agreements of the Employee set forth in
this Agreement.


 


5.                                      NO PRIOR AGREEMENTS


 


The
Employee represents that his performance of all the terms of this Agreement and
any services to be rendered as an employee of the Company, do not and shall not
breach any fiduciary or other duty or any covenant, agreement or understanding
(including, without limitation, any agreement relating to any proprietary
information, knowledge or data acquired by the Employee in confidence, trust or
otherwise prior to the Employee’s employment by the Company) to which the
Employee is a party or by the terms of which the Employee may he bound.  The Employee covenants and agrees that he
shall not disclose to the Company, or induce the Company to use, any, such
proprietary information, knowledge or data belonging to any previous employer
or others.  The Employee further
covenants and agrees not to enter into any agreement or understanding, either
written or oral, in conflict with the provisions of this Agreement.


 


6.                                      EMPLOYMENT AT WILL


 


Nothing
in this Agreement shall be construed as constituting a commitment, guarantee,
agreement or understanding of any kind or nature that the Company shall
continue to employee the Employee, nor shall this Agreement affect in any way
the right of the Employee to terminate his employment with the Company at any
time and for any reason whatsoever.  Both
the Employee and the Company acknowledge that the Employee’s employment is
strictly “at will”.


 


7.                                      BURDEN AND BENEFIT


 


7.1                               This Agreement shall be binding
upon, and shall inure to the benefit of, the Company and the Employee, and
their respective heirs, personal and legal representatives, successors and
assigns.  As used in this Agreement, the
term the “Company”, shall also include any corporation or entity which is a
parent, subsidiary or affiliate of the Company. 
The Employee hereby consents to the enforcement of any and all of the
provisions of this Agreement by or for the benefit of the Company and any such
other corporation or entity as to any Protected Information.


 


7.2                               The Company shall be entitled to
assign this Agreement, in whole or in part, at any time without restrictions.  The Employee may not assign this Agreement or
any part hereof without the prior written consent of the President of the
Company.  This consent may he withheld by
the Company for any reason it deems appropriate.


 


8.                                      GOVERNING LAW


 


8.1                               In view of the fact that the
principal office of the Company is located in Birmingham, Alabama, and that the
Agreement was negotiated, accepted and executed in 


 


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the State of Alabama, it is understood and agreed that the construction
and interpretation of this Agreement shall at all times and in all respects be
governed by the laws of the State of Alabama.


 


8.2                               Without prejudice to the Company’s
right to bring suit in the courts of any jurisdiction, any proceeding to
enforce the provisions of this Agreement or the declaration of any rights
arising from the provisions of this Agreement shall only be brought by the
Employee and may be brought by the Company in the Circuit Court of Jefferson
County, Alabama or, if federal jurisdictional requirements can be met, the
United States District Court for the Northern District of Alabama.  The Employee hereby waives any present or
future objection to such venue and irrevocably consents and submits to the
non-exclusive jurisdiction in personam of such courts.


 


8.3                               THE COMPANY AND THE EMPLOYEE
HEREBY EXPRESSLY AND KNOWINGLY WAIVE THE RIGHT TO A TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER THE COMPANY OR THE
EMPLOYEE AGAINST THE OTHER WITH RESPECT TO THIS AGREEMENT AND ITS SUBJECT
MATTER.


 


9.                                      EFFECTIVE DATE


 


The
Effective Date of this Agreement is the date the Agreement is fully executed by
both the Company and the Employee.


 


10.                               ENTIRE AGREEMENT


 


This
Agreement contains the entire agreement and understanding by and between the
Company and the Employee with respect to the terms and conditions of the
Employee’s employment with the Company (including but not limited to the
compensation to be paid to the Employee during his employment and any payments
that may be owed to the Employee upon a “change in control” and/or termination
of employment), and no representations, promises, agreement or understanding,
written or oral, not herein contained shall be of any force or effect
(including, but not limited to, the Employee’s November 20, 2002 agreement
with the Company, June 24, 1994 employment agreement with the Company, and
July 2006 amendment to employment agreement with the Company, all of which
shall be superseded by this Agreement and be of no further force or
effect).  No change or modification
hereof shall be valid or binding unless the same is in writing and signed by
the party intended to be bound.  No
waiver of any provision of this Agreement shall be valid unless the same is in
writing and signed by the party against whom such waiver is sought to be
enforced, moreover, no valid waiver or any provision of this Agreement at any
time shall be deemed a waiver of any other provision of this Agreement at such
time or shall be deemed a valid waiver of such provision at any other time.


 


11.                               AMENDMENT


 


This
Agreement may be amended, modified or supplemented only by written instrument
executed by both the Company and the Employee.


 


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12.                               HEADINGS


 


The
Headings and other captions in this Agreement are for convenience and reference
only and shall not be used in interpreting, construing or enforcing any of the
provisions of this Agreement.


 


13.                               COUNTERPART


 


This
Agreement may be executed in several counterparts, each of which shall he
deemed to be an original but all of which together shall constitute one in the
same instrument.


 


14.                               SURVIVAL


 


Except
as otherwise provided herein, all provisions to this Agreement shall survive
the termination of the Employee’s employment with the Company.


 


READ THIS AGREEMENT CAREFULLY. 
BY SIGNING BELOW, THE PARTIES ACKNOWLEDGE THAT: (1) EACH HAS
REVIEWED THIS AGREEMENT FULLY AND CAREFULLY; (2) EACH HAS HAD AN
OPPORTUNITY TO ASK QUESTIONS ABOUT ITS CONTENT; AND, (3) EACH HAS BEEN
ADVISED BY COUNSEL OF HIS OR ITS OWN CHOOSING OR HAS DECIDED NOT TO RETAIN HIS
OR ITS OWN COUNSEL.


 


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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year set forth below.


 


	
  Employee:

  	
   

  	
  BioHorizons, Inc.:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/
  J. Todd Strong

  	
   

  	
  /s/
  Andrea G. McCaskey

  
	
  Name:

  	
   

  	
  Andrea
  G. McCaskey

  
	
   

  	
   

  	
  Vice-President,
  Human Resources

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  08/30/2010

  	
   

  	
  08/30/2010

  
	
  Date

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BioHorizons
  Implant Systems, Inc.:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/
  Andrea G. McCaskey

  
	
   

  	
   

  	
  Andrea
  G. McCaskey

  
	
   

  	
   

  	
  Vice-President,
  Human Resources

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  08/30/2010

  
	
   

  	
   

  	
  Date

  



 


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