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<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>

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<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Washington, D.C. 20549</P>

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<P STYLE="font: 18pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FORM 8-K</B></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">CURRENT REPORT PURSUANT TO SECTION
13 OR 15(d)</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">OF THE SECURITIES EXCHANGE ACT OF
1934</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Date of Report (Date of earliest
event reported): &nbsp;March 7, 2012</P>

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<P STYLE="font: 18pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Derma Sciences, Inc.</B></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Exact name of registrant as specified
in its charter)</P>

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    <TD STYLE="width: 34%; padding-right: 0.8pt; line-height: 115%; text-align: center">Pennsylvania</TD>
    <TD STYLE="width: 33%; padding-right: 0.8pt; line-height: 115%; text-align: center">1-31070</TD>
    <TD STYLE="width: 33%; padding-right: 0.8pt; line-height: 115%; text-align: center">23-2328753</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">(State or other jurisdiction</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">(Commission</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">(IRS employer</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">of incorporation)</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">File Number)</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">identification number)</TD></TR>
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<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">214 Carnegie Center, Suite 300</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Princeton, NJ&nbsp;&nbsp;08540</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(609) 514-4744</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Address including zip code and telephone</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">number, of principal executive offices)</P>

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<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 27pt">Check the appropriate box below if
the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
( <I>see</I> General Instruction A.2. below):</P>

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    <TD STYLE="width: 97%; padding-right: 0.8pt; line-height: 115%">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</TD></TR>
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    <TD STYLE="width: 97%; padding-right: 0.8pt; line-height: 115%">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</TD></TR>
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    <TD STYLE="width: 97%; padding-right: 0.8pt; line-height: 115%">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</TD></TR>
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    <TD STYLE="width: 97%; padding-right: 0.8pt; line-height: 115%">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</TD></TR>
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<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 5.02&nbsp;&nbsp;Departure of directors or principal
officers; election of directors; appointment of certain officers; compensatory arrangements of certain officers.</B></P>

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<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">(e)&nbsp; &#9;&nbsp;&nbsp;&nbsp;&nbsp;On March 7, 2012 Derma Sciences, Inc. (the &ldquo;Company&rdquo;)
entered into new employment agreements with Edward J. Quilty, Chairman, President and Chief Executive Officer, John E. Yetter,
CPA, Vice President and Chief Financial Officer and Robert C. Cole, Executive Vice President for Sales. On March 8, 2012, the Company
entered into a new employment agreement with Barry J. Wolfenson, Executive Vice President for Global Business Development and Marketing,
and on March 12, 2012, the Company and its Canadian subsidiary, Derma Canada Inc. (&ldquo;Derma Canada&rdquo;), entered into a
new employment agreement with Frederic Eigner, Executive Vice President for Operations and General Manager of Derma Canada. The
terms of the previous employment agreements of each of the foregoing named executive officers were set to expire on March 31, 2012
and have been superseded and replaced by the new employment agreements, each of which has a term expiring on March 31, 2013. The
material terms of each of the new employment agreements are summarized below.</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Quilty&rsquo;s new employment
agreement with the Company with respect to his position as President and Chief Executive Officer provides for base compensation
of $400,000 per year, effective January 1, 2012, and incentive compensation in the discretion of the Board of Directors of the
Company (the &ldquo;Board&rdquo;). The agreement further provides that, upon the Company&rsquo;s failure to renew the agreement
or termination of employment, each without cause (each a &ldquo;Severance Event&rdquo;), Mr. Quilty is entitled to (i) payment
of severance compensation in the amount of two-year&rsquo;s base salary ($800,000), to be paid in twenty-four equal monthly installments,
(ii) at the Company&rsquo;s expense, the same health care benefits provided to the Company&rsquo;s active employees for twenty-four
months following such Severance Event and (iii) an extension of the period to exercise any options to purchase securities of the
Company to the earlier to occur of (a) the expiration thereof, as set forth in the option instrument, or (b) the tenth anniversary
of the original grant date of the option instrument (an &ldquo;Option Exercise Extension&rdquo;).</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Yetter&rsquo;s new employment
agreement with the Company with respect to his position as Vice President and Chief Financial Officer provides for base compensation
of $250,000 per year, effective January 1, 2012, and incentive compensation in the discretion of the Board. The agreement further
provides that, upon a Severance Event, Mr. Yetter is entitled to (i) payment of severance compensation in the amount of one-year&rsquo;s
base salary ($250,000), to be paid in twelve equal monthly installments, (ii) at the Company&rsquo;s expense, the same health care
benefits provided to the Company&rsquo;s active employees for twelve months following such Severance Event and (iii) an Option
Exercise Extension.</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Cole&rsquo;s new employment agreement
with the Company with respect to his position as Executive Vice President for Sales provides for base compensation of $218,000
per year, effective January 1, 2012, and incentive compensation in the discretion of the Board. The agreement further provides
that, upon a Severance Event, Mr. Cole is entitled to (i) payment of severance compensation in the amount of one-year&rsquo;s base
salary ($218,000), to be paid in twelve equal monthly installments, (ii) at the Company&rsquo;s expense, the same health care benefits
provided to the Company&rsquo;s active employees for twelve months following such Severance Event and (iii) an Option Exercise
Extension.</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Wolfenson&rsquo;s new employment
agreement with the Company with respect to his position as Executive Vice President for Global Business Development and Marketing
provides for base compensation of $235,000 per year, effective January 1, 2012, and incentive compensation in the discretion of
the Board. The agreement further provides that, upon a Severance Event, Mr. Wolfenson is entitled to (i) payment of severance compensation
in the amount of one-year&rsquo;s base salary ($235,000), to be paid in twelve equal monthly installments, (ii) at the Company&rsquo;s
expense, the same health care benefits provided to the Company&rsquo;s active employees for twelve months following such Severance
Event and (iii) an Option Exercise Extension.</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Eigner&rsquo;s new employment
agreement with the Company and Derma Canada with respect to his position as Executive Vice President for Operations and General
Manager of Derma Canada provides for base compensation of $250,000 Cdn. per year, effective January 1, 2012, and incentive compensation
in the discretion of the Board. The agreement further provides that, upon a Severance Event, Mr. Eigner is entitled to (i) payment
of severance compensation in the amount of the greater of (a) one-year&rsquo;s base salary ($250,000 Cdn.), to be paid in twelve
equal monthly installments and (b) the amount specified by the laws of Ontario, Canada, to be paid in monthly installments, (ii)
at Derma Canada&rsquo;s expense, for twelve months following such Severance Event, the health care benefits required by the laws
of Ontario, Canada, and reimbursement for the cost of health care benefits obtained by Mr. Eigner to the extent comparable benefits
and cost coverage is provided to Derma Canada&rsquo;s active employees and (iii) an Option Exercise Extension.</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition, pursuant to the new
employment agreements, upon a &ldquo;change in control event&rdquo; of the Company, as defined in accordance with Section 409A
of the Internal Revenue Code and the regulations thereunder, each of the named executive officers may, within six-months of the
change in control event, tender his resignation and receive the severance compensation and an Option Exercise Extension to the
same extent as if he had been terminated without cause. Each of the new employment agreements also contains a &ldquo;claw back&rdquo;
provision pursuant to which the Company will recoup incentive compensation from the named executive officers in the event of a
financial restatement or other serious issue that results in a downward adjustment of the revenues, profits or other financial
criteria upon which incentive-based compensation was predicated.</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The foregoing descriptions of the
new employment agreements are qualified in their entirety by reference to the full text of the new employment agreements, which
are attached as Exhibits&nbsp;10.1, 10.2, 10.3, 10.4 and 10.5 to this Current Report on Form 8-K and incorporated in this Item&nbsp;5.02
by reference.</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0"><B>Item&nbsp;9.01 Financial Statements and Exhibits</B></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">The following exhibit are included with this report:</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="line-height: 115%">Exhibit No.</TD>
    <TD STYLE="line-height: 115%">&nbsp;</TD>
    <TD STYLE="line-height: 115%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Description</TD></TR>
<TR>
    <TD STYLE="line-height: 115%">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR>
    <TD STYLE="line-height: 115%">10.1</TD>
    <TD STYLE="line-height: 115%">&nbsp;</TD>
    <TD STYLE="line-height: 115%">Employment Agreement, dated March 7, 2012, between the Company and Edward J. Quilty</TD></TR>
<TR>
    <TD STYLE="line-height: 115%">10.2</TD>
    <TD STYLE="line-height: 115%">&nbsp;</TD>
    <TD STYLE="line-height: 115%">Employment Agreement, dated March 7, 2012, between the Company and John E. Yetter, CPA</TD></TR>
<TR>
    <TD STYLE="line-height: 115%">10.3</TD>
    <TD STYLE="line-height: 115%">&nbsp;</TD>
    <TD STYLE="line-height: 115%">Employment Agreement, dated March 7, 2012, between the Company and Robert C. Cole</TD></TR>
<TR>
    <TD STYLE="line-height: 115%">10.4</TD>
    <TD STYLE="line-height: 115%">&nbsp;</TD>
    <TD STYLE="line-height: 115%">Employment Agreement, dated March 8, 2012, between the Company and Barry J. Wolfenson</TD></TR>
<TR>
    <TD STYLE="line-height: 115%">10.5</TD>
    <TD STYLE="line-height: 115%">&nbsp;</TD>
    <TD STYLE="line-height: 115%">Employment Agreement, dated March 12, 2012, between the Company and Frederic Eigner</TD></TR>
</TABLE>
<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 6pt; margin-left: 0.25in; text-indent: 0.25in; text-align: justify">Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="padding-right: 2.8pt; line-height: 115%">DERMA SCIENCES, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 1.8pt; line-height: 115%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 3%; padding-right: 0.8pt; line-height: 115%">By:</TD>
    <TD STYLE="width: 35%; border-bottom: black 1.5pt solid; padding-right: 0.8pt; padding-left: 9pt; line-height: 115%">/s/ John E. Yetter</TD>
    <TD STYLE="width: 12%; padding-right: 0.8pt; line-height: 115%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 1.8pt; line-height: 115%">John E. Yetter, CPA</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 1.8pt; line-height: 115%">Vice President and Chief Financial Officer</TD></TR>
</TABLE>
<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0">Date:&nbsp;&nbsp;March 13, 2012</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">&nbsp;</P>

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<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><B>&nbsp;</B></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>EXHIBIT INDEX</B></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0pt 0"><BR>
&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 12%; padding-right: 0.8pt; line-height: 115%; text-align: center">Exhibit</TD>
    <TD STYLE="width: 1%; padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD STYLE="width: 87%; padding-right: 0.8pt; line-height: 115%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: black 1.5pt solid; padding-right: 0.8pt; line-height: 115%; text-align: center">Number</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; padding-right: 0.8pt; line-height: 115%">Description</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">10.1</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">Employment Agreement, dated March 7, 2012, between the Company and Edward J. Quilty</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">10.2</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">Employment Agreement, dated March 7, 2012, between the Company and John E. Yetter, CPA</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">10.3</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">Employment Agreement, dated March 7, 2012, between the Company and Robert C. Cole</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">10.4</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">Employment Agreement, dated March 8, 2012, between the Company and Barry J. Wolfenson</TD></TR>
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    <TD STYLE="padding-right: 0.8pt; line-height: 115%; text-align: center">10.5</TD>
    <TD STYLE="padding-right: 0.8pt; line-height: 115%">&nbsp;</TD>
    <TD>Employment Agreement, dated March 12, 2012, between the Company and Frederic Eigner</TD></TR>
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[{"type": "8-K", "sequence": "1", "filename": "v305654_8k.htm", "description": "FORM 8-K", "secsgml_size_bytes": 25754}]
{"company-data": {"conformed-name": "DERMA SCIENCES, INC.", "cik": "0000892160", "assigned-sic": "3841", "irs-number": "232328753", "state-of-incorporation": "PA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-13070", "film-number": "12687038"}, "business-address": {"street1": "214 CARNEGIE CENTER, SUITE 300", "city": "PRINCETON", "state": "NJ", "zip": "08540", "phone": "6095144744"}, "mail-address": {"street1": "214 CARNEGIE CENTER, SUITE 300", "city": "PRINCETON", "state": "NJ", "zip": "08540"}, "former-company": {"former-conformed-name": "DERMA SCIENCES INC", "date-changed": "19940513"}}
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION
13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF
1934
Date of Report (Date of earliest
event reported):  March 7, 2012
Derma Sciences, Inc.
(Exact name of registrant as specified
in its charter)
Pennsylvania
1-31070
23-2328753
(State or other jurisdiction
(Commission
(IRS employer
of incorporation)
File Number)
identification number)
214 Carnegie Center, Suite 300
Princeton, NJ  08540
(609) 514-4744
(Address including zip code and telephone
number, of principal executive offices)
Check the appropriate box below if
the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
(
see
General Instruction A.2. below):
£
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
£
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
£
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
£
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 5.02  Departure of directors or principal
officers; election of directors; appointment of certain officers; compensatory arrangements of certain officers.
(e)  	    On March 7, 2012 Derma Sciences, Inc. (the "Company")
entered into new employment agreements with Edward J. Quilty, Chairman, President and Chief Executive Officer, John E. Yetter,
CPA, Vice President and Chief Financial Officer and Robert C. Cole, Executive Vice President for Sales. On March 8, 2012, the Company
entered into a new employment agreement with Barry J. Wolfenson, Executive Vice President for Global Business Development and Marketing,
and on March 12, 2012, the Company and its Canadian subsidiary, Derma Canada Inc. ("Derma Canada"), entered into a
new employment agreement with Frederic Eigner, Executive Vice President for Operations and General Manager of Derma Canada. The
terms of the previous employment agreements of each of the foregoing named executive officers were set to expire on March 31, 2012
and have been superseded and replaced by the new employment agreements, each of which has a term expiring on March 31, 2013. The
material terms of each of the new employment agreements are summarized below.
Mr. Quilty's new employment
agreement with the Company with respect to his position as President and Chief Executive Officer provides for base compensation
of $400,000 per year, effective January 1, 2012, and incentive compensation in the discretion of the Board of Directors of the
Company (the "Board"). The agreement further provides that, upon the Company's failure to renew the agreement
or termination of employment, each without cause (each a "Severance Event"), Mr. Quilty is entitled to (i) payment
of severance compensation in the amount of two-year's base salary ($800,000), to be paid in twenty-four equal monthly installments,
(ii) at the Company's expense, the same health care benefits provided to the Company's active employees for twenty-four
months following such Severance Event and (iii) an extension of the period to exercise any options to purchase securities of the
Company to the earlier to occur of (a) the expiration thereof, as set forth in the option instrument, or (b) the tenth anniversary
of the original grant date of the option instrument (an "Option Exercise Extension").
Mr. Yetter's new employment
agreement with the Company with respect to his position as Vice President and Chief Financial Officer provides for base compensation
of $250,000 per year, effective January 1, 2012, and incentive compensation in the discretion of the Board. The agreement further
provides that, upon a Severance Event, Mr. Yetter is entitled to (i) payment of severance compensation in the amount of one-year's
base salary ($250,000), to be paid in twelve equal monthly installments, (ii) at the Company's expense, the same health care
benefits provided to the Company's active employees for twelve months following such Severance Event and (iii) an Option
Exercise Extension.
Mr. Cole's new employment agreement
with the Company with respect to his position as Executive Vice President for Sales provides for base compensation of $218,000
per year, effective January 1, 2012, and incentive compensation in the discretion of the Board. The agreement further provides
that, upon a Severance Event, Mr. Cole is entitled to (i) payment of severance compensation in the amount of one-year's base
salary ($218,000), to be paid in twelve equal monthly installments, (ii) at the Company's expense, the same health care benefits
provided to the Company's active employees for twelve months following such Severance Event and (iii) an Option Exercise
Extension.
Mr. Wolfenson's new employment
agreement with the Company with respect to his position as Executive Vice President for Global Business Development and Marketing
provides for base compensation of $235,000 per year, effective January 1, 2012, and incentive compensation in the discretion of
the Board. The agreement further provides that, upon a Severance Event, Mr. Wolfenson is entitled to (i) payment of severance compensation
in the amount of one-year's base salary ($235,000), to be paid in twelve equal monthly installments, (ii) at the Company's
expense, the same health care benefits provided to the Company's active employees for twelve months following such Severance
Event and (iii) an Option Exercise Extension.
Mr. Eigner's new employment
agreement with the Company and Derma Canada with respect to his position as Executive Vice President for Operations and General
Manager of Derma Canada provides for base compensation of $250,000 Cdn. per year, effective January 1, 2012, and incentive compensation
in the discretion of the Board. The agreement further provides that, upon a Severance Event, Mr. Eigner is entitled to (i) payment
of severance compensation in the amount of the greater of (a) one-year's base salary ($250,000 Cdn.), to be paid in twelve
equal monthly installments and (b) the amount specified by the laws of Ontario, Canada, to be paid in monthly installments, (ii)
at Derma Canada's expense, for twelve months following such Severance Event, the health care benefits required by the laws
of Ontario, Canada, and reimbursement for the cost of health care benefits obtained by Mr. Eigner to the extent comparable benefits
and cost coverage is provided to Derma Canada's active employees and (iii) an Option Exercise Extension.
In addition, pursuant to the new
employment agreements, upon a "change in control event" of the Company, as defined in accordance with Section 409A
of the Internal Revenue Code and the regulations thereunder, each of the named executive officers may, within six-months of the
change in control event, tender his resignation and receive the severance compensation and an Option Exercise Extension to the
same extent as if he had been terminated without cause. Each of the new employment agreements also contains a "claw back"
provision pursuant to which the Company will recoup incentive compensation from the named executive officers in the event of a
financial restatement or other serious issue that results in a downward adjustment of the revenues, profits or other financial
criteria upon which incentive-based compensation was predicated.
The foregoing descriptions of the
new employment agreements are qualified in their entirety by reference to the full text of the new employment agreements, which
are attached as Exhibits 10.1, 10.2, 10.3, 10.4 and 10.5 to this Current Report on Form 8-K and incorporated in this Item 5.02
by reference.
Item 9.01 Financial Statements and Exhibits
The following exhibit are included with this report:
Exhibit No.
Description
10.1
Employment Agreement, dated March 7, 2012, between the Company and Edward J. Quilty
10.2
Employment Agreement, dated March 7, 2012, between the Company and John E. Yetter, CPA
10.3
Employment Agreement, dated March 7, 2012, between the Company and Robert C. Cole
10.4
Employment Agreement, dated March 8, 2012, between the Company and Barry J. Wolfenson
10.5
Employment Agreement, dated March 12, 2012, between the Company and Frederic Eigner
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
DERMA SCIENCES, INC.
By:
/s/ John E. Yetter
John E. Yetter, CPA
Vice President and Chief Financial Officer
Date:  March 13, 2012
EXHIBIT INDEX
Exhibit
Number
Description
10.1
Employment Agreement, dated March 7, 2012, between the Company and Edward J. Quilty
10.2
Employment Agreement, dated March 7, 2012, between the Company and John E. Yetter, CPA
10.3
Employment Agreement, dated March 7, 2012, between the Company and Robert C. Cole
10.4
Employment Agreement, dated March 8, 2012, between the Company and Barry J. Wolfenson
10.5
Employment Agreement, dated March 12, 2012, between the Company and Frederic Eigner