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Exhibit
10.4
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
T HIS A
MENDED AND R ESTATED E
MPLOYMENT A GREEMENT (the
“Agreement” ) is entered into as of
September 20, 2007, by and between W ILLIAM
D. Y OUNG (the
“Executive” ) and M
ONOGRAM B IOSCIENCES , I
NC . (formerly V IROLOGIC , I
NC . ,), a Delaware corporation (the
“Company” ).
W HEREAS
, Executive and the Company are parties to an Employment
Agreement dated September 29, 1999 (the “Prior
Agreement” ); and
W HEREAS
, Executive and the Company desire to amend and restate the
Prior Agreement and accept the rights and covenants hereof in lieu
of their rights and covenants under the Prior Agreement.
N OW , T
HEREFORE , in consideration of these premises
and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. D UTIES
AND S COPE OF E
MPLOYMENT .
(a) Position. For the
term of his employment under this Agreement (
“Employment” ), the Company agrees to
employ the Executive in the position of Chairman and Chief
Executive Officer . The Executive shall report to the
Company’s Board of Directors (the
“Board”).
(b) Obligations to the
Company. During the term of his Employment, the Executive shall
devote his full business efforts and time to the Company; provided,
however, that this shall not preclude the Executive from serving as
a non-executive member of the board of directors of up to three
other companies to the extent such other companies do not compete
with the Company and that such service does not materially impact
the ability of the Executive to fulfill his obligations to the
Company . The Executive shall comply with the
Company’s policies and rules, as they may be in effect from
time to time during the term of his Employment.
(c) No Conflicting
Obligations. The Executive represents and warrants to the
Company that he is under no obligations or commitments, whether
contractual or otherwise, that are inconsistent with his
obligations under this Agreement . The Executive represents
and warrants that he will not use or disclose, in connection with
his employment by the Company, any trade secrets or other
proprietary information or intellectual property in which the
Executive or any other person has any right, title or interest and
that his employment by the Company as contemplated by this
Agreement will not infringe or violate the rights of any other
person or entity . The Executive represents and warrants to
the Company that he has returned all property and confidential
information belonging to any prior employers.
1.
2. C ASH
AND I NCENTIVE C
OMPENSATION .
(a) Salary. The
Company shall pay the Executive as compensation for his services a
base salary at a gross annual rate of [ $300,000 ] ,
payable in accordance with the Company’s standard payroll
schedule. (The compensation specified in this Subsection (a),
together with any increases in such compensation that the Company
may grant from time to time, is referred to in this Agreement as
“Base Compensation” .)
(b) Incentive
Bonuses. The Executive shall be eligible to be considered for
an annual incentive bonus as part of the Company’s bonus
program based on objective or subjective criteria established by
the Board after consultation with Executive . Such bonus
shall be contingent upon Executive’s continued employment
through the end of the bonus period and Executive shall have no
right to any pro rata portion of the bonus . The
determinations of the Board with respect to such bonus shall be
final and binding.
3. V
ACATION AND E XECUTIVE
B ENEFITS . During the term of his Employment,
the Executive shall be eligible for paid vacations in accordance
with the Company’s standard policy for similarly situated
employees, as it may be amended from time to time . During
the term of his Employment, the Executive shall be eligible to
participate in any employee benefit plans maintained by the Company
for similarly situated employees, subject in each case to the
generally applicable terms and conditions of the plan in question
and to the determinations of any person or committee administering
such plan.
4. B
USINESS E XPENSES . During the
term of his Employment, the Executive shall be authorized to incur
necessary and reasonable travel, entertainment and other business
expenses in connection with his duties hereunder. The Company shall
reimburse the Executive for such expenses upon presentation of an
itemized account and appropriate supporting documentation, all in
accordance with the Company’s generally applicable
policies.
5. T ERM
OF E MPLOYMENT .
(a) Basic Rule.
Executive will remain employed with the Company until the date when
the Executive’s Employment terminates pursuant to Subsection
(b) below . The Executive’s Employment with the
Company shall be “at will,” and either the Executive or
the Company may terminate the Executive’s Employment at any
time, for any reason, with or without Cause . Any contrary
representations, which may have been made to the Executive shall be
superseded by this Agreement . This Agreement shall
constitute the full and complete agreement between the Executive
and the Company on the “at will” nature of the
Executive’s Employment, which may only be changed in an
express written agreement signed by the Executive and a duly
authorized officer of the Company.
(b)
Termination. The Company may terminate the Executive’s
Employment at any time and for any reason (or no reason), and with
or without Cause, by giving the Executive notice in writing. The
Executive may terminate his Employment by giving the Company 14
days’ advance notice in writing. The Executive’s
Employment shall terminate automatically in the event of his death
or permanent disability.
2.
(c) Rights Upon
Termination. Except as expressly provided in Section 6,
upon the termination of the Executive’s Employment pursuant
to this Section 5, the Executive shall only be entitled to the
compensation, benefits and reimbursements described in Sections 2,
3 and 4 for the period preceding the effective date of the
termination . The payments under this Agreement shall fully
discharge all responsibilities of the Company to the
Executive.
(d) Termination of
Agreement. This Agreement shall terminate when all obligations
of the parties hereunder have been satisfied . The
termination of this Agreement shall not limit or otherwise affect
any of the Executive’s obligations under
Section 7.
6. T
ERMINATION B ENEFITS .
(a) Severance
Pay. If the Company terminates the Executive’s Employment
for any reason other than for Cause, or if Employment is terminated
by the death or permanent disability of the Executive, in either
case whether such termination occurs prior or subsequent to a
Change in Control, then the Company shall:
(i) pay the Executive
his Base Compensation for a period of twelve (12) months
following the termination of his Employment (the
“Continuation Period” ), which Base
Compensation shall be paid at the rate in effect at the time of the
termination of Employment and in accordance with the
Company’s standard payroll procedures; and
(ii) if the Executive
elects to continue his health insurance coverage under the
Consolidated Omnibus Budget Reconciliation Act
(“COBRA”) following the termination of his Employment,
then the Company shall pay the Executive’s monthly premium
under COBRA until the earliest of (i) the close of the
Continuation Period or (ii) the expiration of the
Executive’s continuation coverage under COBRA.
(b) Covered
Termination Benefits. In the event of a Covered Termination,
Executive shall receive a severance payment equal to twelve
(12) months of his Base Compensation plus the amount of the
bonus the Executive received during the year prior to the Covered
Termination. Such amount shall be subject to all required tax
withholding and shall be paid in a lump sum upon Executive’s
compliance with subsection (c) below.
(c) General
Release. Any other provision of this Agreement notwithstanding,
subsections (a) and (b) above shall only apply if the
Executive (i) has executed a general release (in the form
attached hereto as Exhibit A) of all known and unknown claims that
he may then have against the Company or persons affiliated with the
Company, and such general release has become effective no later
than forty-five (45) days after the date on which
Executive’s Employment was terminated, and (ii) has
agreed not to prosecute any legal action or other proceeding based
upon any of such claims.
(d)
Definitions
(i)
“Cause.” For all purposes under this
Agreement, “Cause” shall mean:
(1) Unauthorized use
or intentional disclosure of the confidential information or trade
secrets of the Company;
3.
(2) Any material
breach of this Agreement or the Employee Proprietary Information
Agreement between the Executive and the Company;
(3) Conviction of, or
a plea of “guilty” or “no contest” to, a
felony under the laws of the United States or any state
thereof;
(4) Misappropriation
of the assets of the Company or other acts of
dishonesty;
(5) Engagement in
substance abuse which substantially impairs Executive’s
ability to perform the duties and obligations of Executive’s
employment or causes material harm to the reputation of the
Company;
(6) Personal
engagement in any act of moral turpitude that causes material harm
to the reputation of the Company;
(7) Commencement of
employment with another employer while Executive is an employee of
the Company without the prior consent of the Board of Directors;
or
(8) Material
misconduct or gross negligence in the performance of duties
assigned to the Executive under this Agreement.
(ii)
“Change in Control”. For all purposes
under this Agreement, “Change in Control” shall
mean:
(1) a sale or other
disposition of all or substantially all of the assets of the
Company;
(2) a merger or
consolidation in which the Company is not the surviving entity and
in which the stockholders of the Company immediately prior to such
consolidation or merger own less than fifty percent (50%) of
the surviving entity’s voting power immediately after the
transaction;
(3) a reverse merger
in which the Company is the surviving entity but the shares of
Common Stock outstanding immediately preceding the merger are
converted by virtue of the merger into other property, whether in
the form of securities, cash or otherwise, and in which the
stockholders of the Company immediately prior to such reverse
merger own less than fifty percent (50%) of the
Company’s voting power immediately after the
transaction;
(4) an acquisition by
any person, entity or group within the meaning of
Section 13(d) or 14(d) of the Exchange Act, or any comparable
successor provisions (excluding any employee benefit plan, or
related trust, sponsored or maintained by the Company or subsidiary
of the Company or other entity controlled by the Company) of the
beneficial
4.
ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act, or comparable
successor rule) of securities of the Company representing at least
fifty percent (50%) of the voting power
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