Form of Letter Agreement among Johnson & Johnson



 Exhibit 10.3 
  
 March 3,
2005                                        
     
  
 [Name of Executive Officer] 
 c/o Closure Medical Corporation 
 5250 Greens Dairy Road 
 Raleigh, NC 27616 
  
 Re: Change in Control Agreement 
  
 Dear [Name of Executive Officer]: 
  
 As you may know, Johnson & Johnson, a New Jersey corporation (“Parent”), Holden Merger Sub, Inc., a Delaware corporation and wholly-owned
subsidiary of Parent (“Sub”), and Closure Medical Corporation, a Delaware corporation (the “Company”), propose to enter into a merger agreement (the “Merger Agreement”) that will result in the Company (or the surviving
corporation in the merger pursuant to the Merger Agreement (the “Merger”)) becoming wholly-owned by Parent. As a condition to the willingness of Parent and Sub to enter into the Merger Agreement, Parent has requested that you enter into
this letter agreement setting forth certain modifications to your rights and obligations under the employment agreement dated as of [date of employment agreement] between you and the Company (the “Employment Agreement”). Capitalized terms
used but not defined herein have the meanings given such terms under the Employment Agreement. 
  
 Parent, the Company and you each agree as follows: 
  
 1. Modification of “Good Reason”, etc. You agree that, with respect to the definition of “Good Reason” as set forth in Section
7.4.2 of the Employment Agreement, clause (i) thereof shall be modified in its entirety to read as follows: 
  
 “a material adverse change in the Employee’s duties and responsibilities that results from the assignment to you of duties or
responsibilities that are substantially inconsistent with your professional skills and experience levels (taking into account the fact that the Company is no longer an independent publicly held company and has become a subsidiary of another
company)”. 
  
 2. Modification of Treatment Upon
Termination for “Cause”. You agree that the last sentence in Section 7.3 of the Employment Agreement is hereby deleted. 
  
 3. Modification of Benefits Continuation. You agree that the second sentence of Section 7.4.3 of the Employment Agreement shall be modified to
read as follows: 
  
 “The Company shall continue to
provide, for [time period of continuation], all group healthcare (including dental and vision) and group life insurance benefits (and any other group welfare benefits that pursuant to their terms Parent would be able to continue or in respect of
which there is an ability to convert to an individual benefit or policy following termination of employment) in which Employee was entitled to participate immediately prior to the date of termination.” 







 4. Compensation. (a) To the extent you remain employed by the Company, your base salary rate
during the twelve-month period immediately following the consummation of the Merger, shall not be less than your base salary rate in effect on the date hereof. 
  

(b) In addition, you will be eligible to receive an annual bonus with respect to the 2005 calendar year in an amount not less than the annual bonus
amount payable to you in respect of calendar year 2004, to the extent you remain employed with the Company through the applicable payment date for such bonus. 
  

5. Title, Duties and Responsibilities. To the extent you remain employed by the Company during the twelve-month period immediately following
the consummation of the Merger, you shall continue to have the same title as in effect on the date hereof and, in general, you shall continue to have the duties and responsibilities and reporting relationships applicable to such position, it being
understood that such capacity shall be as an employee of a subsidiary of Parent. Nothing in the foregoing provisions of this Paragraph 5 is intended to limit the application of Paragraph 1 of this letter agreement. 
  
 6. Sign-On Options. Subject to the consummation of the Merger, you
will be granted, effective upon the consummation of the Merger, options to acquire              shares of Parent common stock, pursuant to the terms and conditions of Parent’s
stock option plan. 
  
 7. Retention Bonus. Subject to the
consummation of the Merger, and notwithstanding anything to the contrary in the Employment Agreement, if you remain in continuous employment with the Company from the consummation of the Merger through the expiration of the twelve-month period
following the consummation of the Merger, you will receive in lump sum the cash payment that you would have otherwise received pursuant to clause (b) of the first sentence of Section 7.4.3 of the Employment Agreement (assuming for such purpose that
(i) your employment with the Company had been involuntarily terminated by the Company (other than for Cause, Disability or death) or you had resigned from the Company for Good Reason immediately following the consummation of the Merger and (ii) the
term “incentive compensation and benefits” should be deemed to mean the amount of cash bonus payable to you in respect of the 2004 calendar year) (the “Retention Bonus”). In the event you become entitled to payment of the
Retention Bonus, you shall no longer be eligible to receive any severance or termination payments under the Employment Agreement (other than pursuant to Section 7.4.3 of the Employment Agreement (excluding clause (b) of the first sentence thereof,
and after giving effect to the modification as set forth above in Paragraph 3 of this letter agreement)) in respect of any subsequent termination of your employment. 
  
 8. General Waiver and Release. You agree that the Retention Bonus to which you may become entitled hereunder shall
become payable to you only if you execute prior to the payment of such amount, a general waiver and release of all claims, including those under the Employment Agreement, in favor of Parent, the Company and their respective subsidiaries and
affiliates, and others related to such entities (including but not limited to their respective directors, officers and employees), in a form which is a customary waiver and release of Parent, and such waiver and release becomes effective.

  
 9. Full Force and Effect. For the avoidance of doubt,
all other employment terms under the Employment Agreement which have not been modified by this letter agreement, including without limitation Sections 2, 3, 4 and 5 thereof, shall remain in full force and effect following 

  

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the consummation of the Merger, and Parent agrees to cause the Surviving Corporation (as defined in the Merger Agreement) to keep the Employment Agreement in
full force and effect through, at least the twelve-month period following the consummation of the Merger without regard to any earlier date on which it may be scheduled to expire. 
  
 10. Withholding. The Company may withhold from any amounts payable under this letter agreement such Federal, state,
local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation. 
  
 11. Not an Employment Agreement. The terms of this letter agreement neither bind you to continued employment with Parent, the Company or any of
their respective subsidiaries and affiliates nor confer any rights upon you with respect to the continuation of employment by Parent, the Company or any of their respective subsidiaries and affiliates. 
  
 12. Governing Law. This letter agreement will be governed by,
construed and interpreted in accordance with the laws of the State of New Jersey, without regard to its principles of conflicts of laws. 
  
 13. Entire Agreement. This letter agreement contains the entire agreement among you, Parent and the Company concerning the subject matter hereof
and supersedes all prior agreements, understandings, discussions, negotiations and undertakings, whether written or oral, among you, Parent and the Company with respect hereto. You acknowledge and agree that this letter agreement constitutes an
amendment to the Employment Agreement in respect of your participation and rights to any benefits thereunder. This letter agreement may not be modified or amended except by a writing signed by each of the parties hereto. 
  
 14. Successors and Assigns. This letter agreement shall be binding on
(a) you and your estate and legal representatives and (b) the Company, Parent, and their respective successors and assigns. The Company and Parent shall require any successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the Company or the Parent, as the case may be, expressly to assume and agree to perform this letter agreement in the same manner and to the same extent that the Company and
Parent would have been required to perform it if no such succession had taken place. 
  
 15. Counterparts. This letter agreement may be executed in two or more counterparts (including via facsimile), each of which shall be deemed an original but all of which together shall be considered one and the
same agreement. 
  

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 You acknowledge that your agreement to the terms and conditions of this letter agreement is in
consideration of the benefits provided under Paragraphs 4, 5, 6 and 7 of this letter agreement and is an inducement to and a condition of Parent’s and Sub’s willingness to enter into the Merger Agreement. This letter agreement will be void
and of no further force and effect if the Merger Agreement is terminated prior to the consummation of the Merger (it being understood that Parent shall have no liabilities or obligations hereunder unless and until the Merger is consummated).

  

			
	Very truly yours,
	
	JOHNSON & JOHNSON
		
	By:	 	  


	Name:	 	 
	Title:	 	 


  

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	CLOSURE MEDICAL CORPORATION
		
	By:	 	  


	Name:	 	 
	Title:	 	 


  

	
	Agreed and Accepted:
	
	
 [Name of Executive Officer]


  

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 Schedule 10.3 
  

					
	 Name

	  	 Time Period of Continuation of Benefits

	  	Number of
Options


	 James F. Buck
	  	One year after the date of termination.	  	10,000 shares
			
	 William M. Cotter
	  	Three years after the date of termination.	  	15,000 shares
			
	 J. Michael Hoban
	  	One year after the date of termination.	  	10,000 shares
			
	 Jerry Jonn
	  	One year after the date of termination.	  	10,000 shares
			
	 Bruce J. Krattenmaker
	  	One year after the date of termination.	  	10,000 shares
			
	 Gabriel N. Szabo
	  	One year after the date of termination.	  	10,000 shares

  

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