Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers.
As previously reported, BioMimetic Therapeutics, Inc.
(BioMimetic) entered into an Agreement and Plan of Merger (the Merger Agreement) with Wright Medical Group, Inc. (Wright) and Wrights wholly owned subsidiaries, Achilles Merger Subsidiary, Inc. (Merger
Sub) and Achilles Acquisition Subsidiary, LLC (Sister Subsidiary). The Merger Agreement provides that, upon the terms and subject to the conditions thereof, Merger Sub will be merged with and into BioMimetic (the Initial
Merger) followed by BioMimetic merging with and into Sister Subsidiary (together with the Initial Merger, the Transaction).
On December 20, 2012, BioMimetic and Wright entered into a retention agreement with Dr. Samuel E. Lynch, BioMimetics President and Chief Executive Officer. BioMimetic also entered
into retention agreements with certain other executives, including Larry Bullock, BioMimetics Chief Financial Officer, on December 20, 2012, and Dr. Russ Pagano, BioMimetics Vice President, Clinical and Regulatory Affairs, on
December 19, 2012. Below are brief summaries of the terms and conditions of the retention agreements of Dr. Lynch, Mr. Bullock and Dr. Pagano (which are qualified in their entirety by reference to the contracts filed herewith as
Exhibits 10.1 through 10.3, respectively, and incorporated herein by reference).
Pursuant to his retention agreement,
Dr. Lynch is entitled to certain payments and benefits. On the effective date of the retention agreement, Dr. Lynch was entitled to the following:
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$1,250,000 special bonus for work related to the U.S. Food and Drug Administration (the FDA) review process of the Augment® Bone Graft
pre-market approval application, subject to Dr. Lynch signing and not revoking a release of claims with BioMimetic and Wright, payable in a single lump sum upon the date the release is effective and irrevocable;
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$160,275 payment for a portion of his accrued but unused vacation, subject to Dr. Lynch signing and not revoking a release of claims with
BioMimetic and Wright, payable in a single lump sum upon the date the release is effective and irrevocable; and
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$261,632 bonus for calendar year 2012, based on 80% of the target bonus opportunity, paid within 10 calendar days following the effective date of the
retention agreement.
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Subject to the closing of the Transaction and Dr. Lynch signing and not revoking
a supplemental release of claims with BioMimetic and Wright, if Dr. Lynch has remained continuously employed by BioMimetic through the earlier of the 30th day following the date that the FDA approves the Augment® Bone Graft pre-market
approval application or the first anniversary of the closing date of the Transaction (the Closing Date) and terminates his employment with BioMimetic thereafter, or if he is terminated without cause, terminated due to death
or disability or resigns for good reason prior to that date, Dr. Lynch will be entitled to the following:
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$1,121,280 transaction bonus payment, paid on the 31st day following the date Dr. Lynchs employment with BioMimetic terminates; and
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$647,520 non-compete payment, subject to Dr. Lynchs continued compliance for a period of 12 months following the termination of his
employment with his agreement not to engage in certain activities in competition with the business of BioMimetic and not to solicit any of BioMimetics customers or employees (as set forth in Dr. Lynchs employment agreement with
BioMimetic), paid on the 31st day following the date Dr. Lynchs employment with BioMimetic terminates.
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Pursuant to the terms of Dr. Lynchs retention agreement and subject to the
closing of the Transaction, Dr. Lynch has agreed to waive his right to severance payments and benefits pursuant to his employment agreement with BioMimetic, dated July 17, 2009, as amended. Subject to Dr. Lynch signing and not
revoking a supplemental release of claims with BioMimetic and Wright, Dr. Lynch will also be entitled to reimbursement for reasonable expenditures for tax and financial advisory services up to a maximum of $5,000 in the aggregate for a period
of 12 months following the date his employment with BioMimetic terminates and reimbursement for premiums for himself and his eligible dependents to continue coverage pursuant to COBRA for a maximum period of 18 months following the date his
employment with BioMimetic terminates.
Each of Mr. Bullock and Dr. Pagano has also entered into a retention
agreement with BioMimetic. Pursuant to Mr. Bullocks retention agreement, he is entitled to payment of his 2012 calendar year bonus of $46,510 no later than December 31, 2012; a transition assistance award of $40,000, if he remains
continuously employed by BioMimetic through the Closing Date, paid in a single lump sum within 10 business days following such date; and four additional months of salary continuation payments added to the severance to which Mr. Bullock is
otherwise entitled under his employment agreement with BioMimetic, provided that Mr. Bullock remains continuously employed by BioMimetic through the two-month anniversary of the Closing Date.
Pursuant to Dr. Paganos retention agreement, he is entitled to payment of his 2012 calendar year bonus of $35,129 no later
than December 31, 2012; a retention payment of $82,500, payable in a single lump sum within 10 business days following the Closing Date, provided Dr. Pagano remains continuously employed by BioMimetic through the Closing Date, $52,000 of
such retention payment being subject to repayment in the event Dr. Pagano voluntarily resigns prior to the first anniversary of the Closing Date; and an additional retention payment of $184,000 if Dr. Pagano remains continuously employed
by BioMimetic through the first anniversary of the Closing Date, paid within 10 business days following such anniversary.