Exhibit 10.5
RETIREMENT AGREEMENT
THIS RETIREMENT AGREEMENT (this
“ Agreement ”) is made and entered into as of
the 16th day of January, 2009 by and between QUIDEL CORPORATION, a
Delaware corporation (the “ Company ”), and
CAREN L. MASON, an individual (“ Mason
”).
BACKGROUND
A.
Mason currently serves as the Company’s President and Chief
Executive Officer and as a member of the Company’s Board of
Directors. Pursuant to pre-existing and continuing employment
and related understandings and agreements, Mason’s employment
with the Company is “at will.”
B.
Mason previously advised the Company, and the Company has publicly
announced, that Mason will retire from her employment with the
Company effective June 1, 2009 (the “ Retirement
Date ”).
C.
The Company and Mason are entering into this Agreement to confirm
their understandings as to Mason’s employment prior to the
Retirement Date and each party’s commitments and obligations
on and after the Retirement Date.
AGREEMENT
1.
Employment . The Company shall continue to
employ Mason on a full-time basis, and Mason accepts such continued
employment, upon and subject to the terms and conditions set forth
herein. Mason acknowledges and agrees that, as of
March 1, 2009, Mason’s title will be changed to
“Special Advisor to the Chief Executive Officer,” a
position that will report to, and involve duties determined by, the
Chief Executive Officer. In such role, Mason agrees to make
herself available for assignments and to dutifully complete such
assignments to the best of her ability at such locations as
reasonably designated by the Chief Executive Officer. In
connection with scheduling of assignments and travel, if any, in
her role as Special Advisor to the Chief Executive Officer, the
Company and Mason agree to schedule assignments with at least
fourteen days notice and as mutually agreed.
Concurrently herewith, (a) the
Employment Agreement between the Company and Mason dated
August 20, 2004, as amended (the “ Superseded
Employment Agreement ”), shall automatically become
void and superseded in its entirety by this Agreement (except for
those provisions of the Superseded Employment Agreement that are
expressly incorporated herein by reference pursuant to
Section 5 hereof), and (b) the term of the Agreement Re:
Change in Control between the Company and Mason dated
August 20, 2004, as amended (the “ CIC Agreement
”), shall automatically expire (after which the CIC Agreement
will be of no force or effect). For the avoidance of doubt,
(x) except as expressly provided herein, Mason shall not be
entitled to any payments or benefits of any kind in connection with
a termination or resignation for any reason and (y) that
certain Indemnification Agreement dated August 18, 2005
between the Company and Mason shall continue in full force and
effect pursuant to its terms.
2.
Term . Pursuant to the Retirement/Resignation
attached hereto as Exhibit A , which Mason has executed
and delivered concurrently with this Agreement, (a) Mason will
automatically cease to be a member of the Company’s Board of
Directors on March 1, 2009, and (b) the term of
Mason’s employment shall continue until, and then
automatically terminate, on June 1, 2009, unless earlier
terminated.
3.
Employment Compensation . Until March 1,
2009, Mason’s base salary shall continue at the same level as
in effect as of the date of this Agreement. Effective
March 1, 2009, Mason’s base salary shall automatically
be reduced to $10,000 per month (i.e., March, April, May), less
applicable withholdings and subject to the Company’s payroll
policies.
Mason’s employee benefits
shall continue until June 1, 2009 at the same levels as are in
effect as of the date of this Agreement; provided, however, that
Mason shall not receive any further grants of equity incentive
awards nor shall she be eligible to participate in any bonus plans
applicable to fiscal year 2009 or any year thereafter. Mason
shall, however, remain eligible to receive a bonus under the
Company’s existing 2008 cash incentive bonus plan if and to
the extent that (a) an allocation is made to Mason by the
Board of Directors or the Compensation Committee of the Board of
Directors, (b) the relevant performance metrics are achieved,
and (c) Mason remains employed by the Company through the
earlier of (1) the payment date of the 2008 bonus, if any, or
(2) the Retirement Date.
4.
Releases . On each of (a) the date hereof,
and (b) a date of Mason’s choice between May 1,
2009 and May 11, 2009 inclusive, and as a material condition
to Mason’s receipt of the benefits set forth in
Section 6 hereof, Mason shall execute and deliver to the
Company (and thereafter not revoke) a Release in the form attached
hereto as Exhibit B . (For avoidance of doubt,
the parties acknowledge and agree that Mason’s failure to
deliver (and not thereafter revoke) either executed Release in the
time period specified above shall result in no further vesting of
Mason’s equity awards after the date of this
Agreement.)
5.
Mason’s Acknowledgements and Obligations .
As a material condition to Mason’s receipt of
the benefits set forth in Section 6 hereof, Mason acknowledges
and reaffirms Section 5 (At Will Employment),
Section 6(f) (re: IRC Section 409A), Section 7
(Inventions), Section 8 (Nondisclosure of Confidential
Information), Section 9 (Return of Materials at Termination)
and Section 10 (Non-Solicitation) of the Superseded Employment
Agreement, which provisions are incorporated herein by reference
and shall survive the termination of Mason’s
employment.
6.
Vesting of Equity Awards . The vesting of
equity awards (restricted stock and options) held by Mason shall
not be accelerated. Such equity awards shall, during
Mason’s continuing employment, continue to vest and be
governed in accordance with the applicable equity incentive plan
and specific equity award grant documentation. All equity
awards held by Mason at the time of the termination of her
employment shall also be handled in accordance with the applicable
equity incentives plans and grant documentation.
2
7.
Early Resignation or Termination . In the event
that Mason either (a) voluntarily resigns her employment with
an effective date prior to the Retirement Date, or (b) is
terminated by the Company with “Cause” (as defined
below), Mason shall not be entitled to the payments or vesting
benefits described in Section 3 or Section 6 hereof, but
shall only be entitled to salary, accrued benefits and other
amounts legally owing to Mason through the date of employment
termination. The Company shall thereafter have no further
obligations to Mason under this Agreement.
In the event that Mason is
terminated by the Company without “Cause” (as defined
below), provided that Mason executes and delivers to the Company
within seven (7) calendar days after such termination (and
thereafter does not revoke) a Release in the form attached hereto
as Exhibit B , Mason shall be entitled to receive the
following severance payments and benefits: (i) a
lump-sum payment equal to the remaining amount of base salary that
Mason would have received if the term of this Agreement had
continued until June 1, 2009, less applicable withholdings,
payable within thirty (30) days from the date of termination,
(ii) the employee benefits described in the second paragraph
of Section 3 hereof through June 1, 2009 and
(iii) the vesting of equity awards, as and to the extent
described in and contemplated by Section 6 hereof, as though
Mason’s employment continued through June 1,
2009.
For purposes hereof,
“Cause” shall be limited to the following:
(1) fraud; (2) personal dishonesty involving money or
property of the Company or that results in material harm to the
Company; (3) Mason’s willful misconduct that is
materially injurious to the Company; (4) a serious breach of a
fiduciary duty to the Company involving personal profit;
(5) Mason’s conviction for a felony (including via a
guilty or nolo contendere plea), excluding traffic offenses;
(6) Mason’s willful and continued neglect of duties
(other than any such failure resulting from her incapacity because
of physical or mental illness); or (7) Mason’s material
breach of this Agreement; provided, however, that unsatisfactory
job performance shall not be considered Cause for termination of
Mason’s employment by the Company. Mason shall be
afforded a reasonable opportunity to cure any willful neglect of
her duties and any other alleged material breach of this Agreement,
according to the following terms. The Company’s Board
of Directors shall give Mason written notice stating with
reasonable specificity the nature of the circumstances determined
by the Board of Directors in good faith to constitute willful
neglect or other material breach, and that failure to cure or
correct such circumstances or breach will result in termination of
employment for “Cause” under this Agreement.
Mason shall have thirty (30) days from her receipt of such notice
to cure such circumstances or such breach if such breach is
reasonably susceptible of cure. If, in the reasonable good
faith judgment of the Board of Directors, the alleged breach is
not
