AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
Originally Effective March 12,
2003
First Amendment Effective January 1, 2004
Amendment and Restatement Effective May 17, 2006
Second Amendment and Restatement Effective March 1, 2007
Third Amendment and Restatement Effective November 18,
2008
THIS EMPLOYMENT
AGREEMENT (the “Agreement”) is made by and between
Gen-Probe Incorporated, a Delaware corporation with offices at
10210 Genetic Center Drive, San Diego, California 92121
(“Gen-Probe”), and Henry L. Nordhoff (the
“Executive”).
The parties hereto
agree as follows:
|
1.
|
|
Amendment and Restatement of
Employment Agreement . The Employment Agreement between
Gen-Probe and Executive dated March 12, 2003, as previously
amended as of January 1, 2004, May 17, 2006 and March 1,
2007, is hereby amended and restated as set forth herein as of
November 18, 2008 (the “Amendment Effective
Date”).
|
|
2.
|
|
Term of Employment
. This Agreement shall
be immediately effective. This Agreement, and Executive’s
employment hereunder, shall be for a term of three years from
May 17, 2006, provided, however, that Gen-Probe’s
obligations pursuant to Sections 8(c) and 9 of this Agreement shall
be for an indefinite term. At any time during the term of this
Agreement, either party may terminate this Agreement, and
Executive’s employment, in accordance with the provision of
Sections 7 and 8 of this Agreement.
|
|
3.
|
|
Position and Duties
. The Executive shall
serve as President and Chief Executive Officer of Gen-Probe, and
shall have commensurate responsibilities and authority. The Board
of Directors may from time to time particularly specify the
Executive’s duties and authority. The Executive shall not
engage in or perform duties for any other persons or entities that
interfere with the performance of his duties hereunder, provided
that the Executive may continue to serve on the boards of directors
and boards of trustees on which he served on March 12, 2003.
Any outside board of director positions accepted by the Executive
after March 12, 2003 will be subject to approval by the Board of
Directors of Gen-Probe.
|
|
4.
|
|
Salary, Bonus and
Benefits .
|
|
|
(a)
|
|
Salary . During the period of
Executive’s employment, Gen-Probe shall pay Executive an
annual base salary of $645,000.00. This base salary may be
increased by the Compensation Committee of the Board, subject to
the terms of this Agreement and consistent with the
Executive’s performance and Gen-Probe’s policy
regarding adjustments in officer compensation established from time
to time by the Compensation Committee. The base salary shall not be
decreased during the term of this Agreement.
|
|
|
(b)
|
|
Bonus . In addition, at the discretion of
the Compensation Committee, the Executive will be awarded incentive
compensation, in the form of a cash bonus for each fiscal year
during his employment, based upon performance. Executive’s
target bonus shall be seventy-five percent (75%) of his base
salary; however, the actual bonus shall be set at the discretion of
the Compensation Committee.
|
|
|
|
|
|
|
|
(c)
|
|
Stock Options/Restricted
Stock .
In addition, Executive may be awarded stock options, restricted
stock awards and other equity compensation awards by
Gen-Probe’s Compensation Committee, with such terms and
conditions as the Compensation Committee may determine in its sole
discretion.
|
|
|
|
|
|
|
|
(d)
|
|
Life Insurance
. Gen-Probe will obtain
and pay for a term life insurance policy providing for payment of
$1,000,000 in benefits to the Executive’s designated
beneficiaries should the Executive die during the term of this
Agreement. (This policy shall be in addition to any coverage
provide by Gen-Probe’s group life insurance plan pursuant to
subsection (g), below.)
|
|
|
|
|
|
|
|
(e)
|
|
Disability Insurance
. Gen-Probe will obtain
and pay for a long-term disability insurance policy providing for
payment at a rate of no less than $200,000 per annum to Executive
should Executive suffer a long-term disability during the term of
this Agreement. (This policy shall be in addition to any coverage
provide by Gen-Probe’s group disability insurance plan
pursuant to subsection (g), below.)
|
|
|
|
|
|
|
|
(f)
|
|
AD& D Insurance
. Gen-Probe will obtain
and pay for an AD&D insurance policy providing for a benefit to
Executive (or his beneficiaries) of $400,000 (airplane) or
$200,000 (automobile or walking) should Executive suffer accidental
death or accidental disability during the term of this
Agreement.
|
|
|
|
|
|
|
|
(g)
|
|
Other Benefits
. The Executive shall be
entitled to participate in the employee benefit programs (including
but not limited to medical, dental, life and disability insurance,
401K retirement plan, and vacation program), as adopted and
maintained by Gen-Probe. The Executive may receive such other and
additional benefits as the Compensation Committee or Board may
determine from time to time in its sole discretion.
|
|
5.
|
|
Expense Reimbursement
. The Executive shall be
entitled to receive prompt reimbursement for all reasonable and
customary expenses incurred by him in performing services
hereunder, including all expenses of travel and living expenses
while away from home on business or at the request of, and in the
service of Gen-Probe; provided, that such expenses are incurred and
accounted for in accordance with the policies and procedures
established by Gen-Probe. To the extent that reimbursements made
pursuant to this Agreement, including under Section 8(c) and
Section 9, are subject to the provisions of Section 409A
of the Internal Revenue Code of 1986, as amended (the
“Code”), (a) the reimbursement shall be made in
the no later than December 31 of the calendar year following
the year in which the expense was incurred, (b) the amount of
expenses reimbursed in one year shall not affect the amount
eligible for reimbursement in
|
2
|
|
|
any
subsequent year, and (c) the Executive’s right to
reimbursement under this Section 4 will not be subject to
liquidation or exchange for another benefit.
|
|
|
|
|
|
6.
|
|
Indemnification
. Gen-Probe shall
indemnify the Executive to the maximum extent permitted by law, by
the by-laws of Gen-Probe and by the Indemnification Agreement dated
August 19, 2002, between the Executive and Gen-Probe, as it
may be amended (the “Indemnification Agreement”), if
the Executive is made a party, or threatened to be made a party, to
any threatened or pending legal action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of the
fact that the Executive is or was an officer, director or employee
of Gen-Probe or any subsidiary or affiliate thereof, in which
capacity the Executive is or was serving at Gen-Probe’s
request, against reasonable expenses (including reasonable
attorneys’ fees), judgments, fines and settlement payments
incurred by him in connection with such action, suit or
proceeding.
|
|
|
|
|
|
7.
|
|
Termination
. The Executive may
terminate his employment hereunder at any time, with or without
Good Reason (as defined below) upon written notice to Gen-Probe. If
Executive contends that Good Reason exists for his termination,
such notice shall specifically and expressly state the grounds
which he contends constitute Good Reason. Gen-Probe may terminate
the Executive’s employment hereunder at any time, subject to
the terms of this Agreement, with or without Cause (as defined
below) upon written notice to the Executive. If this Agreement is
terminated, all compensation and benefits other than severance
benefits described in Section 8 below, to the extent
applicable, shall immediately cease, except that the Executive will
be entitled, through the date of termination, to payment of his
salary and benefits under Gen-Probe benefit programs and plans in
accordance with their terms.
|
|
|
|
|
|
|
|
As
used in this Agreement, “Good Reason” shall mean any of
the following events that are not consented to by the Executive:
(i) the removal of the Executive from his position as the
Chief Executive Officer of Gen-Probe; (ii) a substantial and
material diminution in the Executive’s duties and
responsibilities hereunder; (iii) a reduction of the
Executive’s base salary or target bonus percentage;
(iv) the location of the Executive’s assignment on
behalf of Gen-Probe is moved to a location more than 30 miles from
its present location; (v) the failure of Gen-Probe to obtain a
satisfactory agreement from any successor to Gen-Probe to assume
and agree to perform this Agreement; or (vi) a material breach
by Gen-Probe of its obligations under this Agreement after notice
in writing from the Executive and a reasonable opportunity for
Gen-Probe to cure or substantially mitigate any material adverse
effect of such breach. The Executive’s consent to any event
which would otherwise constitute Good Reason shall be conclusively
presumed if the Executive does not exercise his rights to terminate
this Agreement for Good Reason under this section within six
(6) months of notice of the event.
|
|
|
|
|
|
|
|
As
used in this Agreement, “Cause” shall mean any of the
following events: (i) any act of gross or willful misconduct,
fraud, misappropriation, dishonesty, embezzlement or similar
conduct on the part of Executive; (ii) the Executive’s
conviction of a felony or any crime involving moral turpitude
(which conviction, due to the passage of time or otherwise, is not
subject to further appeal); (iii) the Executive’s misuse
or abuse of alcohol, drugs or controlled substances and failure to
seek and comply with appropriate
|
3
|
|
|
treatment; (iv) willful and
continued failure by the Executive to substantially perform his
duties under this Agreement (other than any failure resulting from
disability or from termination by the Executive for Good Reason) as
determined by a majority of the Board after written demand from the
Board of Directors for substantial performance is delivered to the
Executive, and the Executive fails to resume substantial
performance of his duties on a continuous basis within 30 days
of such notice; (v) the death of the Executive; or
(vi) the Executive becoming disabled such that he is not able
to perform his usual duties for Gen-Probe for a period in excess of
six (6) consecutive calendar months.
|
|
|
|
|
|
8.
|
|
Severance Benefits in Certain
Events .
If Gen-Probe terminates the Executive’s employment for
reasons other than Cause, or if the Executive terminates his
employment for Good Reason, and such termination constitutes a
“separation from service” within the meaning of
Treasury Regulation Section 1.409A-1(h) (a
“Separation from Service”), the Executive shall be
entitled to receive the following severance benefits:
|
|
|
(a)
|
|
Salary .
|
|
|
|
|
|
|
|
|
|
(i)
Unless the Executive’s termination under this Section 8
occurs within eighteen (18) months after a Change in Control,
the Executive shall continue to receive his base salary, at the
rate in effect at the time of his termination of employment, in
monthly installments following termination and continuing for an
aggregate period of twenty-four (24) months (the “Salary
Continuation Period”), except that any payments that would
otherwise have been made before the sixtieth (60th) day after the
date of termination of the Executive’s employment (the
“First Payment Date”) shall be made on the First
Payment Date.
|
|
|
|
|
|
|
|
|
|
(ii) If the Executive’s
termination under this Section 8 occurs in connection with a
Change in Control, then the Executive shall receive a lump sum
payment as described in this Section 8(a)(ii). For purposes of
this Agreement, “Change in Control” shall have the
meaning set forth on Attachment “1” to this Agreement
(hereby incorporated by reference). A termination shall be
“in connection with” a Change in Control if the
termination occurs within the period six (6) months prior to
or eighteen (18) months after a Change in Control (and in the event
that the termination occurs during the six (6) months prior to
a Change in Control, subject to the consummation of the Change in
Control and the transaction constituting a change in the ownership
or effective control of Gen-Probe or a change in the ownership of a
substantial portion of the assets of Gen-Probe, as described in
Treasury Regulation Section 1.409A-3(i)(5)). The lump sum
payment will be payable on the later of (A) five (5) days
after the Change in Control, or (B) sixty (60) days after
the date of the termination of employment. If the termination
occurred within the six (6) months prior to a Change in
Control, the amount of the lump sum payment pursuant to this
Section 8(a)(ii) shall be equal to twelve
(12) months’ base salary (and shall be in addition to
the installment payments described in Section 8(a)(i)); if the
termination occurs within eighteen (18) months after a Change
in Control, the amount of the lump sum payment pursuant to this
Section 8(a)(ii) shall be equal to thirty-six
(36) months’ base salary.
|
4
|
|
(b)
|
|
Bonus . The Executive shall be entitled to
receive a pro rata portion of th
|
|
