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Exhibit 10.7  


 
 
 

Prometheus Laboratories Inc.    
    
    2008 Management Bonus Plan    
    
    Approved by the Board of Directors and/or
  Compensation Committee, effective November 8,
2007    








 
Prometheus Laboratories  


 2008 Management Bonus Plan  


The
Prometheus Laboratories 2008 Management Bonus Plan (the "Plan") is designed to offer incentive compensation to eligible employees by rewarding the achievement of corporate goals and specifically
measured individual goals that are consistent with and support overall corporate goals. The Bonus Plan is intended to create an environment where participants are focused on the achievement of both
corporate and departmental objectives. Cooperation between departments and individuals will be
required to achieve corporate objectives. Hence, corporate objectives represent a significant portion of the Plan in order to help foster improved teamwork and a more cohesive management team. 


Purpose of the Plan  


The
Plan is designed to: 



	•
	Provide
an incentive program to achieve overall corporate objectives and to enhance shareholder value.



	•
	Reward
those individuals who significantly impact corporate results.



	•
	Encourage
increased teamwork among all disciplines within Prometheus (the "Company").



	•
	Incorporate
an incentive program in the Company's overall compensation program to help attract and retain employees. 




Plan Governance  


The
Plan will be governed by the Compensation Committee (the "Compensation Committee") of the Board of Directors of the Company (the "Board"). The President and CEO of the Company will be responsible
for administration of the Plan. The Compensation Committee will be responsible for approving any incentive awards to officers of the Company and the Board of Directors will approve any incentive
awards to the President and CEO. 


Eligibility  


Employees
who may be eligible to participate in the Plan shall be selected at the sole discretion of the Company. To receive an bonus payment ("Award") under this Plan, a participant: (a) must
have been in an eligible position for at least three (3) consecutive months prior to the end of the Plan year and must remain continuously employed through the end of the Plan year and until
Awards are paid; (b) must be performing at a minimum level of a "Partially Meets Standard" (a rating of "4" in the current system) or higher at the time Awards are paid; and (c) must be
of active status and in good standing on the date the Award is paid. 


Corporate and Individual Performance  


Prior
to the beginning of the Plan year, the President and CEO will present to the board a list of the overall corporate objectives for the coming year, which are subject to approval by the Board. All
participants in the Plan will then develop a list of key individual objectives, which will be approved by the participants' direct managers. 



The
Plan is intended to provide incentive for the achievement of approved annual corporate and individual objectives. If an individual's objectives are modified during the plan year, he/she must
obtain written agreement from his/her management. 


For
all Plan participants, except the President and CEO, a portion of their incentive compensation will be based on corporate goal achievement and a portion will be based on individual achievement.
The 


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relative
weight between Corporate and individual performance factors will vary based on levels within the organization. The weighting will be reviewed annually and be adjusted, as necessary or
appropriate. The weighting for 2008 will be as follows: 



	 
	 	Corporate
	 	Individual/Departmental
	 
	President and CEO	 	100	%	0	%
	Executive Vice Presidents, Sr. Vice Presidents, Vice Presidents	 	75	%	25	%
	Sr. Directors, Directors, Associate Directors	 	50	%	50	%
	Sr. Managers	 	25	%	75	%






Target Award Multiplier  


Bonus
Award target dollar amounts for each associate will be determined by applying a target award multiplier to the base salary of Plan participants. The following target award multipliers will be
used in implementing the Plan: 



	Position
 
	 	Target Award Multiplier (% of base salary)
	 
	President and CEO	 	50	%
	Senior Vice Presidents; Executive Vice Presidents	 	40	%
	Vice Presidents	 	30	%
	Sr. Directors	 	25	%
	Directors	 	20	%
	Associate Directors	 	15	%
	Sr. Managers	 	10	%






The
target award multiplier will be used to establish the target incentive award at the beginning of each year. 


If
an employee moves from one bonus tier to another during the calendar year, the bonus Award will be prorated according to the time in each position during the evaluation period. Proration for
partial months will be calculated using the number of days in position for the partial month. 



Payment of the Award  


The
Board will approve the level of funding for the Plan, based on its assessment of the overall achievement of Corporate objectives for 2008. A corporate award multiplier will be assigned, based on
the Board's assessment of company performance. 


The
Individual performance award multiplier is determined by the participant's management, and is tied to the individual's performance rating for the plan year. 


Payment
of Awards is generally made in the first quarter of the year following the plan year. 



Minimum and Maximum Payments  


Generally,
in order for any payment (Corporate or Individual) to be made to plan participants, the
Corporate funding must meet a minimum of 75%. In cases where the Corporate funding has not met the minimum threshold, the President and CEO will have, in his/her discretion, the ability to make a
discretionary award to an individual where recognition of exemplary performance is warranted. 


The
maximum multiplier for Corporate payout is 150%. 



The
maximum multiplier for Individual payout is 150%. 


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Award Calculations  


The
actual award for an employee will be calculated by allocating the target incentive award between the Corporate and Individual goals, and then applying the Corporate ward multiplier to the
Corporate amount, and the Individual performance award multiplier to the Individual amount. 


Bonus
Award calculations will be based on the participant's base salary as of December 31, 2008. If the 2009 annual merit increases are applied prior to January 1, 2009, then the base
salary shall be defined as salary prior to the 2009 merit increase.


Participants
who have been in an eligible position for less than a year, but who hold an eligible position for at least three months prior to the end of the Plan year and remain continuously employed
through the end of the Plan year, will receive a pro-rata bonus based on the portion of the Plan year they hold an eligible position. Proration will be calculated on a daily basis. 



Bonus
award payments will also be prorated for any time during the year an employee is not classified as an active employee. Proration for partial months will be calculated using the number of days as
an active employee for the partial months. 


Form of Incentive Award Payments  


Bonus
award payments will be made in cash, and are subject to applicable withholdings and taxes. 



Termination  


A
Plan participant whose employment terminates voluntarily prior to the payment of the Awards will not be eligible to receive an Award. If a participant's employment is terminated involuntarily during
the calendar year, or prior to payment of Awards, it will be at the absolute discretion of the Company and/or Board whether or not any Award payment is made. 


Company's Absolute Right to Alter or Abolish the Plan  


The
Company reserves the right in its absolute discretion to abolish the Plan at any time or to alter the terms and conditions under which awards will be paid. Such discretion may be exercised any
time before, during, and after the Plan year is completed. No participant shall have any vested right to receive any payment until actual delivery of such compensation. 


Employment Duration/Employment Relationship  


This
Plan does not, and Company policies and practices in administering this Plan do not, constitute an express or implied contract or other agreement concerning the payment of any award or the
duration of any participant's employment with the Company. The employment relationship of each participant is "at will" and may be terminated at any time by the Company or by the participant, with or
without cause. 


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CONFIDENTIAL



	DATE:	 	 
	 	 
	

TO:	
 	

Human Resources	
 	

 
	

FROM:	
 	

 
	
 	

 




Prometheus Laboratories

2008 Management Bonus Plan  


This
is to acknowledge that I have received a copy of the 2008 Management Bonus Plan. 



	Name:	 	 
 (print)	 	Date:	 	 

	

 	
 	

 
 (signature)	
 	

 	
 	

 




Please return signed copy to Human Resources Department. 











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Prometheus Laboratories Inc. 2008 Management Bonus Plan