THIS EMPLOYMENT
AGREEMENT (the “Agreement”) is made as of
February 13, 2007 (the “Effective Date”) by and
between Gen-Probe Incorporated, a Delaware corporation with offices
at 10210 Genetic Center Drive, San Diego, California 92121
(“Gen-Probe”), and Carl W. Hull (the
“Executive”).
The parties hereto
agree as follows:
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1.
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Term of Employment.
This Agreement shall be
immediately effective. This Agreement, and Executive’s
employment hereunder, 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 6 and 7 of this Agreement.
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2.
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Position and Duties.
The Executive shall
serve as Executive Vice President & Chief Operating
Officer of Gen-Probe, and shall have commensurate
responsibilities and authority. Executive acknowledges that more
than one employee of the Company may be assigned the title of
Executive Vice President. 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. Any outside board of director positions
held by the Executive will be subject to approval by the Board of
Directors of Gen-Probe. Executive has informed Gen-Probe that he
presently serves as a member of the Board of Directors of the
American College of Medical Genetics Foundation, a non-profit
organization.
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3.
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Salary, Bonus and
Benefits.
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(a)
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Salary . Gen-Probe shall pay Executive an
initial annual base salary of $425,000. This base salary may be
adjusted annually by 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 Board.
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(b)
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Bonus . In addition, at the Board’s
discretion, the Executive may 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 fifty percent (50%) of his base salary; however, the
actual bonus shall be set at the discretion of the Compensation
Committee.
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1
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(c)
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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), which may be adopted and
maintained by Gen-Probe. The Executive may receive such other and
additional benefits as the Board may determine from time to time in
its sole discretion.
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4.
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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.
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5.
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Indemnification.
Gen-Probe shall
indemnify the Executive to the maximum extent permitted by law and
by the by-laws of Gen-Probe 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. Gen-Probe and Executive shall enter into the
company’s standard indemnification agreement in connection
with this Paragraph 5.
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6.
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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 7 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.
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As used in this
Agreement, “Good Reason” shall mean any of the
following events that are not consented to in writing by the
Executive: (i) a substantial and material diminution in the
Executive’s duties and responsibilities hereunder;
(ii) the removal of the Executive from his position as Chief
Operating Officer of Gen-Probe (iii) 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; (iv) a
reduction of more than ten percent (10%) in the Executive’s
base salary, annual target bonus
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percentage or
in the Executive’s benefits received from Gen-Probe;
(v) the failure of Gen-Probe to obtain a satisfactory
agreement from any other 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 ninety
(90) days 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 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; (vi) the death of the Executive; or
(vii) 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.
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7.
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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, the
Executive shall be entitled to receive as liquidated damages, the
following severance benefits:
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(a)
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Salary. 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 twelve
(12) months (the “Salary Continuation Period”);
provided, however , that if termination under this
Section 7 occurs in connection with a Change in Control, then
the Executive shall receive a single lump sum payment, payable
within 10 days of termination, equal to eighteen
(18) months’ base salary.
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For purposes of
this Agreement, “Change in Control” shall have the
meaning set forth on Attachment “1” to this Agreement
(hereby incorporated by reference). For purposes of this Agreement,
a termination shall be “in connection with” a Change in
Control if termination occurs within the period six (6) months
prior to or eighteen (18) months after a Change in
Control.
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Notwithstanding
anything to the contrary set forth herein, the provisions of this
paragraph shall control if Executive’s employment terminates
within the period six (6) months prior to a Change in Control. Any
lump sum payment contemplated by this Section 7(a)
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