Document:

Exhibit 10.25

 

EMPLOYMENT
AGREEMENT

 

EMPLOYMENT
AGREEMENT (“Agreement”) dated as of September 05, 2006 and amended and
restated as of September 5, 2008 (“Renewal Date”), between Talecris
Biotherapeutics Holdings Corp. (the “Company”) and John F. Gaither, Jr.
(the “Executive”) (together, the “Parties”) is amended and restated as of November 6,
2008.

 

WHEREAS, the
Parties have previously entered into this agreement and they now wish to extend
and update its terms in order to establish its compliance with Section 409A
of the Internal Revenue Code of 1986, as amended (the “Code”), with the
understanding that this Agreement supersedes all prior versions and hereinafter
shall solely establish the terms of Executive’s employment with the Company.

 

Accordingly,
the Parties agree as follows:

 

1.             Employment and Acceptance.  The Company shall employ the Executive, and
Executive shall accept employment, subject to the terms of this Agreement,
beginning on September 05,
2006 (the “Effective Date”).

 

2.             Term.  Subject to earlier termination pursuant to Section 5
of this Agreement, this Agreement and the employment relationship hereunder
shall continue for
two (2) years from the Effective Date (“Initial Term”) and is hereby renewed
for a First Renewal Term of two (2) years and shall renew for
additional one (1) year intervals upon written notification by the Board of
Directors.  If the Board does
not provide such written notification thirty days prior to the expiration of
the Term, then the Agreement shall not be extended. If the Board
provides such written notification then the Agreement shall be so extended
unless the Executive provides written notification to the Board that
Executive does not wish to extend the Term. 
Executive’s written notice of his desire not to extend the Term shall be
provided to the Board by sixty (60) days prior to the expiration of the Term or,
if the Board
has not yet then provided such notification, then by seven (7) days after
written notification from the Board. 
As used in this Agreement, the “Term” shall refer to the period
beginning on the Effective Date and ending on the date the Executive’s
employment terminates in accordance with this Section 2 or Section 5.  “Renewal Term” shall refer to each additional
one year interval following the expiration of the Initial Term or the previous
Renewal Term.  First Renewal Term shall refer to the two
year period beginning on September 5, 2008.  In the event that the Executive’s
employment with the Company terminates for any reason, the Company’s obligation
to continue to pay all wages, base salary, as adjusted, bonus and other
benefits then accrued shall terminate except as may be provided for in Section 5
of this Agreement.

 

3.             Duties and Title.

 

3.1.         Title.  The Company shall employ the Executive to
render exclusive and full-time services to the Company and its
subsidiaries.  The Executive shall serve
in the capacity of Executive Vice President, General Counsel, and Corporate
Secretary of Talecris Biotherapeutics Holdings Corp., and shall report directly
to the Chief Executive Officer and to any committees of the Board of Directors
(the “Board”) as determined in the discretion of the Board.

 

 

3.2.         Duties. 
The Executive will have such authority and responsibilities and will
perform such executive duties customarily performed by a general counsel or
chief legal counsel of a company in similar lines of business as the Company
and its subsidiaries or as may be assigned to Executive by the Chief Executive
Officer.  The Executive will devote all
his full working-time and attention to the performance of such duties and to
the promotion of the business and interests of the Company and its subsidiaries
except for directorships and similar positions approved by the Executive
Chairman or the Chief Executive Officer,
which approval may be revoked at any time. 
As of the date of this Agreement, Executive’s position as Counsel to the
Board of Directors of Global Healthcare Exchange, LLC is approved

 

4.             Compensation and Benefits by the
Company.  As compensation for all services rendered pursuant to this
Agreement, the Company shall provide the Executive the following during the
Term:

 

4.1.         Base Salary.  The Company will pay to the Executive an
annual base salary of three hundred and fifty thousand dollars ($350,000) as of the Renewal Date, payable in
accordance with the customary payroll practices of the Company (“Base Salary”).
Beginning in 2010, Executive’s Base Salary shall be reviewed consistent with
the normal merit and pay adjustment cycle for executives.  In evaluating adjustments to Executive’s Base
Salary, such factors as corporate performance, individual merit, inflation, and
other appropriate considerations shall be taken into account.

 

4.2.         Bonuses.  The Executive will be eligible to receive an
annual bonus (“Bonus”) under a plan established by the Company in the amount
determined by the Board based upon achievement of performance measures derived
from the annual business plan presented by management and approved by the
Board.  The Executive’s target bonus as of the Renewal Date shall be 65% of base salary (the “Target Bonus”),
with the actual amount of each Bonus being determined under the Bonus Plan in
effect at that time as approved by the Board.

 

4.3.         Participation in Employee Benefit Plans.  The Executive shall be entitled, if and to
the extent eligible, to participate in all of the applicable benefit plans of
the Company, which may be available to other senior executives of the Company,
on the same terms as such other executives. 
The Company may at any time or from time to time amend, modify, suspend
or terminate any employee benefit plan, program or arrangement for any reason
without Executive’s consent if such amendment, modification, suspension or
termination is consistent with the amendment, modification, suspension or
termination for other employees of the Company. 
The Executive shall apply for all reimbursements hereunder for a
particular calendar year not later than forty-five (45) days after it ends, and
payment shall occur not later than two and one-half months after the end of the
calendar year to which the reimbursable expenses relate.

 

4.4.         Personal
Time Off.  The Executive shall
be entitled to 30 days (240 hours) of Personal Time Off (PTO).  PTO time
is to be used for vacation, sick leave, personal business, observance of
non-company holidays, and other time off.  The PTO schedule assumes a
maximum of 4 weeks (160 hours) of vacation, and 10 days (80 hours) for sick
time, personal holidays, and other personal business.  Executive shall not
be entitled to

 

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payment
for unused PTO hours upon the termination of his employment except as set forth
in Section 5 below.  The carry-over and accrual of PTO hours shall be
in accordance with Company policy as in effect from time to time, except that
10 days of PTO will immediately accrue.

 

4.5.         Expense Reimbursement.  The Executive shall be entitled to receive
reimbursement for all appropriate business expenses incurred by him in
connection with his duties under this Agreement in accordance with the policies
of the Company as in effect from time to time. 
In any event, the Executive shall apply for all reimbursements hereunder
for a particular calendar year not later than forty-five (45) days after it
ends, and payment shall occur not later than two and one-half months after the
end of the calendar year to which the reimbursable expenses relate.

 

4.6.         Stock Options.  The Executive shall be eligible to
participate in the 2005 Stock Option and Incentive Plan established by the
Company (the “Equity Incentive Plan”) pursuant to the terms of the Equity
Incentive Plan and any applicable agreements thereunder as determined from time
to time by the Board.

 

4.7.         Relocation and Temporary Living Expenses.  Upon
submission of appropriate receipts, all reasonable relocation expenses, up to a
maximum prior to gross-up of $150,000,
incurred by Executive will be reimbursed by the Company including (but not
limited to): relocation assistance fees, realtor and closing costs on the sale
of Executive’s primary residence and purchase of a primary residence in
North Carolina, three family house hunting
trips for the Executive and actual moving date, trucking/moving expenses, and
car rental until relocated, storage and other reasonable expenses incurred in
the normal course of relocation (“Relocation Expenses”). In addition,
Executive will be reimbursed by the Company for travel expenses and reasonable temporary quarters until relocated (“Temporary
Living Expenses”).  Taxable Relocation Expenses
and Temporary Living Expenses will be
grossed up to cover Executive’s federal and state income tax liability. In
any event, the Executive shall apply for all reimbursements hereunder for a
particular calendar year not later than forty-five (45) days after it ends, and
payment shall occur not later than two and one-half months after the end of the
calendar year to which the reimbursable expenses relate.

 

4.8.         Continuing Professional Education. The
Company agrees to pay reasonable costs associated with the continuing education
requirements of maintaining the Executive’s professional designation, including
related professional organization memberships, as well as seminars to advance
the Executive’s skills. Such costs include the reasonable costs of seminars,
travel, lodging and meals while attending such functions.  Time associated with continuing education
requirements will not be considered PTO.

 

4.9.         Parachute
Payments.  Anything in the Agreement
to the contrary notwithstanding, in the event it shall be determined that any
payments or distribution in the nature of compensation (within the meaning of Section 280G(b)(2) of
the Code) to or for the benefit of the Executive, whether paid or payable
pursuant to this Agreement (including, without limitation, the accelerated
vesting of incentive or equity awards held by the Executive) or otherwise would
be subject to the excise tax imposed by Section 4999 of the Code, then the
amount of “parachute payments” (as defined in the Section 280G of 

 

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the Code) payable or required to be provided to the Executive shall be
automatically reduced to the minimum extent necessary to avoid imposition of
such excise tax (with the types of benefits or compensation that are reduced to
be determined by the Company at its discretion, which shall be exercised first
with respect to compensation and benefits that are not exempt from Code Section 409A);
provided that this reduction shall not apply if the Executive would be better
off, on a net after-tax basis, receiving the parachute payments that would
otherwise be reduced and paying such excise tax.  Notwithstanding the foregoing, the Company
and Executive shall use their reasonable efforts to have any payments or
distributions that would be reduced or eliminated as a result of the
application of this Section 4.9 approved by the Company’s shareholders in
the manner contemplated by Q&A 7 of Treasury Regulation Section 1.280G
1.  All determinations required to be
made under this Section 4.9 shall be made by the Company’s accounting firm
(the “Accounting Firm”); provided that the Executive may select which, if any,
parachute payments shall be reduced.  The
Accounting Firm shall provide detailed supporting calculations both to the
Company and the Executive.  All fees and
expenses of the Accounting Firm shall be borne solely by the Company.  Absent manifest error, any determination by
the Accounting Firm shall be binding upon the Company and the Executive.

 

5.             Termination of Employment.

 

5.1.         By the Company for Cause or by the
Executive Without Good Reason.  If: (i) the
Company terminates the Executive’s employment with the Company for Cause (as
defined below); or (ii) Executive terminates his employment without Good
Reason (as defined below), the Executive or the Executive’s legal
representatives (as appropriate), shall be entitled to receive, within 60 days
of the Executive’s Separation from Service (subject to Section 9.10
below),  the following:

 

5.1.1.                   the Executive’s accrued but unpaid
Base Salary, and benefits set forth in Section 4.3, if any, to the date of
Separation from Service;

 

5.1.2.                   the Executive’s earned but unpaid
bonus, if any, for the performance years prior to termination and only if the
Company and not the Executive terminates employment;

 

5.1.3.                   expenses reimbursable under Section 4.5
and Temporary Living Expenses under Section 4.7 incurred but not yet
reimbursed to the Executive to the date of Separation from Service.

 

5.1.4.                   payment for accrued unused PTO,
payable in accordance with Company policy, with payment to be made within 60
days after the Executive’s Separation from Service;

 

For the purposes of this
Agreement, “Cause” means, as determined by the Board (or a special committee of
the Board which does not include employees of the Company), with respect to
conduct during the Executive’s employment with the Company, whether or not
committed during the Term, (i) commission of a felony by Executive; (ii) acts
of dishonesty by Executive resulting or intending to result in personal gain or
enrichment at the expense of the Company or its subsidiaries; (iii) Executive’s
material breach of his obligations under this 

 

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Agreement; (iv) conduct
by Executive in connection with his duties hereunder that is fraudulent,
unlawful or grossly negligent, including, but not limited to, acts of
discrimination; (v) engaging in personal conduct by Executive (including
but not limited to employee harassment or discrimination, the use or possession
at work of any illegal controlled substance) which discredits or damages the
Company or its subsidiaries; (vi) contravention of specific lawful
direction from the Chief Executive Officer that would not otherwise conflict
with Executive’s responsibilities or duties or the material failure to perform
the duties to be performed by Executive under the terms of Section 3.2 of
this Agreement or (vii) breach of the Executive’s covenants set forth in Section 6
below before termination of employment; provided, that, the Executive shall
have fifteen (15) days after notice from the Company to cure the deficiency
leading to the Cause determination (except with respect to (i) and (ii) above),
if curable.  A termination for “Cause”
shall be effective immediately (or on such other date set forth by the
Company).

 

For the purposes of this
Agreement, “Good Reason” means, without the Executive’s consent, (i) a
material reduction in the Executive’s responsibilities, authority, or duties; (ii) the
Executive’s removal from the position of General Counsel other than for Cause; (iii) a
material adverse reduction in the amount of aggregate compensation provided for
herein or failure to pay such compensation; (iv) the Company’s material
breach of the Agreement; provided that a suspension of the Executive and the
requirement that the Executive not report to work shall not constitute “Good
Reason” if the Executive continues to receive the compensation and benefits
required by this Agreement or (v) relocation after the Effective Date of the
Executive’s office more than 50 miles from its location on the Effective Date (vi) the
failure by the Company to continue in effect any incentive compensation plan in
which the Executive participates unless an equitable alternative compensation
arrangement has been provided, except to the extent that participation in such
plans has been reduced or eliminated for all other eligible executives; (vii) except
as required by law, the failure by the Company to continue to provide Executive
with benefits at least as favorable as those enjoyed by Executive under the
employee benefit and welfare plans of the Company including, without
limitation, profit sharing, life insurance, medical, dental, health and
accident, disability, deferred compensation and savings plans commensurate with
those generally available to all Executives. 
Notwithstanding the foregoing, a reduction in the amount of Executive’s
aggregate compensation in an amount proportional to such a reduction (but not
to exceed 20 percent) in the aggregate compensation of other senior executives
shall not constitute Good Reason.  The
Executive shall provide notice to the Company of the existence of (i) through
(vii) of this Section within ninety (90) days of the initial
existence of such condition, upon the notice of which the Company shall have at
least thirty (30) days within which to cure such condition.  If the Company fails to cure the condition
within the cure period specified in the preceding sentence, the Executive must
terminate employment within thirty (30) days of the Company’s failure to cure.

 

For purposes of this Agreement,
“Separation from Service” shall mean the termination of services provided by
Executive, whether voluntary or involuntary, as determined by the Company in
accordance with Treas. Reg. §1.409A-1(h). 
In determining whether the Executive has experienced a Separation from
Service, the following provisions shall apply:

 

(a)  a Separation from Service shall
occur when the Executive experiences a termination of employment with the Company
and any affiliate in which the Company has more than a 50% ownership interest
(together with the Company, the “Employer”), which 

 

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shall be
considered to have occurred when the facts and circumstances indicate that
either (i) the Executive is not reasonably expected to perform further
services for the Employer after a certain date, or (ii) that the level of
bona fide services the Executive will perform for the Employer after such date
(whether as an Employee or as an independent contractor) will permanently
decrease to no more than 20% of the average level of bona fide services
performed by such Executive (whether as an Employee or an independent
contractor) over the immediately preceding 36-month period (or full period of
services to the Employer if the Executive has been providing services to the
Employer for less than 36 months).

 

(b)  If the Executive is on military
leave, sick leave, or other bona fide leave of absence, the employment
relationship between the Executive and the Employer shall be treated as
continuing intact, provided that the period of such leave does not exceed six
months, or longer, so long as the Executive retains a right to reemployment
with the Employer under an applicable statute or by contract.  If the period of leave exceeds six months and
the Executive does not retain a right to reemployment under an applicable
statute or by contract, the Executive will incur a Separation from Service as
of the first day immediately following the end of such six-month period.  However, where the Executive’s leave of
absence is due to his or her Disability, a 29-month period of absence will be
substituted for such six-month period. 
In applying the provisions of this paragraph, a leave of absence shall
be considered a bona fide leave of absence only if there is a reasonable
expectation that the Executive will return to perform services for the
Employer.

 

(c)  Notwithstanding the foregoing, if
the Executive provides services to the Employer as both an employee and a
member of the Board, then to the extent permitted by Treasury Regulation Section 1.409A-1(h)(5),
the services provided by such Executive as a Board member shall not be taken
into account in determining whether the Executive experiences a Separation from
Service as an employee.

 

5.2.         Due to Death or Disability.  If: (i) the Executive’s employment
terminates due to his death; or (ii) the Company terminates the Executive’s
employment with the Company due to the Executive’s Disability (as defined
below) and (i) the Executive honors all applicable provisions of this
Agreement following such termination due to Disability, (ii) Executive
agrees to make a good faith effort to the extent reasonably able to do so to
provide consulting services to the Company as requested by the Company during
the severance period at no additional payment or remuneration other than the
severance amount stated herein, (iii) Executive or Executive’s legal
representative executes, without revoking, a valid release agreement in a form
reasonably acceptable to the Company (but which does not require Executive or
Executive’s legal representative to release any rights under this Section 5.2
of the Agreement or indemnification rights under Section 8 of the
Agreement or under the articles of incorporation or by-laws of the Company or
any of its subsidiaries), the Executive or the Executive’s legal
representatives (as appropriate), shall be entitled to receive the incremental
severance payments set forth in this Section 5.2 (in addition to the
payments upon termination set forth in Section 5.1):

 

5.2.1.                   the unpaid portion of the Bonus, if
any, relating to the calendar years prior to the calendar year of the Executive’s
termination, payable within 60 days after the Executive’s Separation from
Service;

 

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5.2.2.                   if the Company achieves the
performance objectives for the year in which Executive’s employment is
terminated, a pro-rata share of the Bonus in such performance year (based upon
the number of days he was employed by the Company in the year in question) at
100% of Target Bonus, payable in the same manner and at the same time as other
executives remaining at the Company are paid, but in no event later than two
and one-half months after the end of the calendar year in which the Executive’s
right to payment vests hereunder; and

 

5.2.3.                   the exercising of vested stock
options as set forth in Section 4.2 of Executive’s Stock Option Award
Agreement.

 

5.2.4.                   For the purposes of this Agreement, “Disability”
means a reasonable determination by a physician reasonably acceptable to the
Company and in accordance with applicable law that as a result of a physical or
mental injury or illness, the Executive is unable to perform the essential functions
of his job with or without reasonable accommodation for a period of (i) 60
consecutive days; or (ii) 90 days in any one (1) year period.

 

5.3.         By the Company Without Cause or By the
Executive for Good Reason.  If during
the Term the Company terminates Executive’s employment without Cause (which may
be done at any time without prior notice) or Executive terminates his
employment for Good Reason upon at least fifteen (15) days prior written
notice, the Executive shall receive the incremental severance payments set
forth in this Section 5.3, as described below (in addition to the payments
upon termination specified in Section 5.2) upon execution without
revocation of a valid release agreement in a form reasonably acceptable to the
Company (but which does not require Executive to release any rights under this Section 5.3
of the Agreement or indemnification rights under Section 8 of the
Agreement or under the articles of incorporation or by-laws of the Company or
any of its subsidiaries) and provided that the Executive honors all applicable
provisions of this Agreement following termination and that Executive agrees to
provide consulting services to the Company, upon request, of up to ten (10) hours
of Executive’s time per month during this eighteen (18) month time period, at
no additional payment or remuneration other than the severance amount stated
herein:

 

5.3.1.                   continued Base Salary for the
greater of eighteen (18) months after the date of termination or the remainder
of the number of months remaining in the then current contract term payable in
a lump sum on the last business day of the month following the Separation from
Service;

 

5.3.2.                   Bonus payments in an aggregate
amount equal to the lesser of the Bonus amount earned by the Executive for the
years prior to the calendar year of the Executive’s termination (without regard
to any pro ration) or the Target Bonus, payable in a lump sum on the last
business day of the month following the Separation from Service, or if such
prior year bonus has not been determined at such time, on the last business day
of the month following such determination in a lump sum.

 

5.3.3.                   to the extent Executive elects to
continue his group health coverage pursuant to COBRA, the Company shall pay its
usual share of his group health insurance premium for the period in which Base
Salary is paid under Section 5.3.1 payable

 

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in a lump sum on the last business day of the month following the
Separation from Service, after which Executive may exercise his rights (at his
sole expense) to continuation coverage of group health coverage pursuant to
COBRA.  Notwithstanding the foregoing,
the benefits provided under this Section 5.3.3, shall cease when Executive
is covered under another group health plan.

 

5.3.4.                   in the event of termination
following a Change in Control, occurs on or before the end of the First Renewal Term, Executive shall be entitled
to: (a) protection on the actual losses he reasonably incurs on the sale
of his primary residence located in the Raleigh area in an amount up to
$200,000 (the calculation of such loss to include the difference between the
Executive’s cost of purchase including any renovation expenses which are
completed within 18 months of relocation and which are included in the taxable
basis of the property and the sale proceeds net of selling expenses and
mortgage interest following the termination event) and (b) a relocation
allowance of $50,000 provided he is relocating his primary residence at least
100 miles from the then current residence in Raleigh and the relocation occurs
within six months of the termination event.

 

5.3.5.                   the exercising of vested stock
options as set forth in Section 4.1 of Executive’s Stock Option Award
Agreement.

 

5.4.         Termination Due to Completion of Term
Without Renewal  If the contract
lapses due to non-renewal by the Company (i) upon expiration of the Initial Term, (ii) upon expiration of the first
Renewal Term, or (iii) upon expiration of any subsequent Renewal Term
within six (6) months of a Change in Control, the Executive or the
Executive’s legal representatives (as appropriate)
shall be entitled to receive the benefits set forth in Section 5.3,
but specifically excluding the benefits set forth in Section 5.3.2.

 

5.5.         Termination by Executive following Change
in Control. If Executive terminates his employment during the 90-day period
commencing six months after a
Change in Control not involving an Initial Public Offering, the Executive shall
be entitled to receive the
incremental severance payments set forth in Section 5.3.

 

A Change in Control means the
occurrence of any one of the following:

 

(i)            any
Person, other than a Permitted Investor, is or becomes a “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
of securities of the Company representing (A) more than 30% of the total
voting power of the Company’s then outstanding securities generally eligible to
vote for the election of directors (the “Company Voting Securities”) and
(B) a greater percentage of the then outstanding Company Voting Securities
that are than held by all the Permitted Investors in the aggregate; provided,
however, that any of the following acquisitions shall not be deemed to
be a Change in Control: (l) by the Company or any subsidiary or affiliate,
(2) by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any subsidiary or affiliate, (3) by any
underwriter temporarily holding securities pursuant to an offering of such
securities, or (4) pursuant to a Non-Qualifying Transaction (as defined in
paragraph (ii));

 

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(ii)           the
consummation of a merger, consolidation, statutory share exchange or similar
form of corporate transaction involving the Company or any of its subsidiaries
or affiliates (a “Business Combination”), unless immediately following
such Business Combination:

 

(A)                         more than 50% of the total
voting power of (x) the corporation resulting from such Business
Combination (the “Surviving Corporation”), or (y) if applicable,
the ultimate parent corporation that directly or indirectly has beneficial
ownership of a majority of the voting securities eligible to elect directors of
the Surviving Corporation (the “Parent Corporation”), is represented by
Company Voting Securities that were outstanding immediately prior to such
Business Combination (or, if applicable, is represented by shares into which
such Company Voting Securities were converted pursuant to such Business
Combination), and such voting power among the holders thereof is in
substantially the same proportion as the voting power of such Company Voting
Securities among the holders thereof immediately prior to the Business
Combination,

 

(B)                           no Person, other than a
Permitted Investor or any employee benefit plan (or related trust) sponsored or
maintained by the Surviving Corporation or the Parent Corporation, is or
becomes the beneficial owner, directly or indirectly, of securities of the
Parent Corporation (or, if there is no Parent Corporation, the Surviving
Corporation) representing (A) 30% of the total voting power of the
securities then outstanding generally eligible to vote for the election of
directors of the Parent Corporation (or the Surviving Corporation) (the “Parent
Voting Securities”), and (B) a greater percentage of the then
outstanding Parent Voting Securities that are then held by all the Permitted
Investors in the aggregate, and

 

(C)                           at least a majority of the
members of the board of directors of the Parent Corporation (or, if there is no
Parent Corporation, the Surviving Corporation) following the consummation of
the Business Combination were Incumbent Directors at the time of the Board’s
approval of the execution of the initial agreement providing for such Business
Combination; (any Business Combination which satisfies all of the criteria
specified in (A), (B) and (C) above shall be deemed to be a “Non-Qualifying
Transaction”) ;

 

(iii)          the shareholders of
the Company approve a plan of complete liquidation or dissolution of the
Company; or

 

(iv)          the
consummation of a sale of all or substantially all of the Company’s assets to
an entity that is not an affiliate of the Company (other than pursuant to a
Non-Qualifying Transaction).

 

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Notwithstanding the foregoing, a Change in Control of the Company shall
not be deemed to occur solely because any person acquires beneficial ownership
of more than 30% of Company Voting Securities as a result of the acquisition of
Company Voting Securities by the Company which reduces the number of Company
Voting Securities outstanding; provided, that if after such
acquisition by the Company such person becomes the beneficial owner of
additional Company Voting Securities that increases the percentage of
outstanding Company Voting Securities beneficially owned by such person, a
Change in Control of the Company may then occur.

 

5.6.         Limitation on Termination Payments.  The Company’s obligation to provide the
payments and benefits set forth above in Sections 5.2, 5.3, 5.4, and 5.5 will
immediately cease in the event the Executive engages in conduct constituting a
breach of the provision of Sections 5.9 or 6 of this Agreement.

 

5.7.         Compliance with 409A.  This Agreement is
intended to comply with (or be exempt from) Code Section 409A, and the
Company shall have complete discretion to interpret and construe this
Agreement and any associated documents in any manner that establishes an
exemption from (or otherwise conforms them to) the requirements of Code Section 409A.  If, for any reason including imprecision in
drafting, the Agreement does not accurately reflect its intended establishment
of an exemption from (or compliance with) Code Section 409A, as
demonstrated by consistent interpretations or other evidence of intent, the
provision shall be considered ambiguous and shall be interpreted by
the Company in a fashion consistent herewith, as determined in the
sole and absolute discretion of the Company.  The Company reserves
the right to unilaterally amend this Agreement without the consent
of any Executive in order to accurately reflect its correct interpretation
and operation, as well as to maintain an exemption from or compliance with Code
Section 409A.  Neverthless, and
notwithstanding any other provision of this Agreement, neither the Company nor
any of its employees, directors, or their agents shall have any
obligation to mitigate, nor to hold the Executive harmless from, any or
all taxes (including any imposed under Code Section 409A) arising under
this Agreement.

 

5.8.         Removal from any Boards and Position.  If the Executive’s employment is terminated
for any reason under this Agreement, he shall be deemed to resign (i) if a
member, from the Board or board of directors of any subsidiary of the Company
or any other board to which he has been appointed or nominated by or on behalf
of the Company and (ii) from any position with the Company or any
subsidiary of the Company, including, but not limited to, as an officer of the
Company and any of its subsidiaries.

 

5.9.         Non-disparagement.  The Company and Executive agree that neither
party will at any time (whether during or after the Term) publish or
communicate to any person or entity except in the case of the Executive to his
spouse, or in the case of the Company and Executive to legal counsel, any
Disparaging (as defined below) remarks, comments or statements concerning the
Executive or the Company, Cerberus Capital Management, L.P., Ampersand
Ventures, their parents, subsidiaries and affiliates, and their respective
present and former members, partners, directors, officers, shareholders,
employees, agents, attorneys, successors and assigns, except as required by law
or an order of a court or governmental agency with jurisdiction.  “Disparaging” remarks, comments or statements
are those that impugn the character, honesty, integrity or morality or business

 

10

 

acumen or abilities in connection with any aspect of the operation of
business of the individual or entity being disparaged.

 

6.             Restrictions and Obligations of the
Executive

 

6.1.         Confidentiality.  (a) During the course of the Executive’s
employment by the Company (prior to and during the Term), the Executive has had
and will have access to certain trade secrets and confidential information
relating to the Company and its subsidiaries (the “Protected Parties”) which is
not readily available from sources outside the Company.  The confidential and Proprietary information
and, in any material respect, trade secrets of the Protected Parties are among
their most valuable assets, including but not limited to, their customer,
supplier and vendor lists, databases, competitive strategies, computer
programs, frameworks, or models, their marketing programs, their sales, financial,
marketing, training and technical information, their product development (and
proprietary product data) and any other information, whether communicated
orally, electronically, in writing or in other tangible forms concerning how
the Protected Parties create, develop, acquire or maintain their products and
marketing plans, target their potential customers and operate their retail and
other businesses.  The Protected Parties
invested, and continue to invest, considerable amounts of time and money in
their process, technology, know-how, obtaining and developing the goodwill of
their customers, their other external relationships, their data systems and
data bases, and all the information described above (hereinafter collectively
referred to as “Confidential Information”), and any misappropriation or
unauthorized disclosure of Confidential Information in any form would
irreparably harm the Protected Parties. 
The Executive acknowledges that such Confidential Information
constitutes valuable, highly confidential, special and unique property of the
Protected Parties.  The Executive shall
hold in a fiduciary capacity for the benefit of the Protected Parties all
Confidential Information relating to the Protected Parties and their
businesses, which shall have been obtained by the Executive during the
Executive’s employment by the Company or its subsidiaries and which shall not
be or become public knowledge (other than by acts by the Executive or
representatives of the Executive in violation of this Agreement).  Except as required by law or an order of a
court or governmental agency with jurisdiction, the Executive shall not, during
the period the Executive is employed by the Company or its subsidiaries or at
any time for five (5) years thereafter, disclose any Confidential
Information, directly or indirectly, to any person or entity for any reason or
purpose whatsoever, nor shall the Executive use it in any way, except in the
course of the Executive’s employment with, and for the benefit of, the
Protected Parties or to enforce any rights or defend any claims hereunder or
under any other agreement to which the Executive is a party, provided that such
disclosure is relevant to the enforcement of such rights or defense of such
claims and is only disclosed in the formal proceedings related thereto.  The Executive shall take all reasonable steps
to safeguard the Confidential Information and to protect it against disclosure,
misuse, espionage, loss and theft.  The
Executive understands and agrees that the Executive shall acquire no rights to
any such Confidential Information.  (b) All
files, records, documents, drawings, specifications, data, computer programs,
evaluation mechanisms and analytics and similar items, except for those
evaluation mechanisms and analytics and similar items which are of prior art or
common practice within the Executive’s professional capacity, relating thereto
or to the Business (for the purposes of this Agreement, “Business” shall 

 

11

 

be as defined in Section 6.3 hereof), as well as all customer
lists, specific customer information, compilations of product research and
marketing techniques of the Company and its subsidiaries, whether prepared by
the Executive or otherwise coming into the Executive’s possession, shall remain
the exclusive property of the Company and its subsidiaries, and the Executive
shall not remove any such items from the premises of the Company and its
subsidiaries, except in furtherance of the Executive’s duties under any employment
agreement.  (c) It is understood
that while employed by the Company or its subsidiaries, the Executive will
promptly disclose to it, and assign to it the Executive’s interest in any
invention, improvement or discovery made or conceived by the Executive, either
alone or jointly with others, which: (i) relate in any manner to the
existing or contemplated business, research or activities of the Company; (ii) are
suggested by or result from Executive’s work with the Company, or (iii) result
from the Executive’s use of the Company’s time, materials, information,
employees or facilities even if made or conceived during other than working
hours.  At the Company’s request and
expense, the Executive will assist the Company and its subsidiaries during the
period of the Executive’s employment by the Company or its subsidiaries and
thereafter in connection with any controversy or legal proceeding relating to
such invention, improvement or discovery and in obtaining domestic and foreign
patent or other protection covering the same. 
(d) As requested by the Company and at the Company’s expense, from
time to time and upon the termination of the Executive’s employment with the
Company for any reason, the Executive will promptly deliver to the Company and
its subsidiaries all copies and embodiments, in whatever form, of all
Confidential Information in the Executive’s possession or within his control
(including, but not limited to, memoranda, records, notes, plans, photographs,
manuals, notebooks, documentation, program listings, flow charts, magnetic
media, disks, diskettes, tapes and all other materials containing any
Confidential Information) irrespective of the location or form of such
material.  If requested by the Company,
the Executive will provide the Company with written confirmation that all such
materials have been delivered to the Company as provided herein.

 

6.2.         Non-Solicitation or Hire.  During the Term and for a period of
twenty-four (24) months following the termination of the Executive’s employment
for any reason, the Executive shall not solicit or attempt to solicit or
induce, directly or indirectly: (a) any person or entity who is a customer
of the Company or its subsidiaries, or who was a customer of the Company or its
subsidiaries at any time during the twelve (12) month period immediately prior
to the date the Executive’s employment terminates for any reason, to market,
sell or provide to any such person or entity any services or products offered
by or available from the Company or its subsidiaries (provided that if the
Executive intends to solicit any such person or entity for any other purpose,
he shall notify the Company of such intention and receive prior written
approval from the Company); (b) any supplier to the Company or any
subsidiary to terminate, reduce or alter negatively its relationship with the
Company or any subsidiary or in any manner interfere with any agreement or
contract between the Company or any subsidiary and such supplier; or (c) any
employee of the Company or any of its subsidiaries or any person who was an
employee of the Company or any of its subsidiaries during the twelve (12) month
period immediately prior to the date the Executive’s employment terminates for
any reason, to terminate such employee’s employment relationship with the
Protected Parties in order, in either 

 

12

 

case, to enter into a similar relationship with the Executive or any
other person or any entity in competition with the Business of the Company or
any of its subsidiaries.

 

6.3.         Non-Competition.  During the Term and following the
Executive’s Separation from Service with the Company for any reason, Executive,
for the greater of eighteen (18) months or the period in which the Company is
making payments to the Executive in accordance with Sections 5.2, 5.3, 5.4, and
5.5 above, shall not, whether individually, as a Director, Manager, member,
stockholder, partner, owner, employee, consultant or agent of any business, or
in any other capacity, other than on behalf of the Company or its subsidiaries,
directly or indirectly organize, establish, own, operate, manage, control,
engage in, participate in, invest in, permit his name to be used by, act as a
consultant or advisor to, render services which are materially similar to his
services provided to the Company under this Agreement for, alone or in
association with any person, firm, corporation or business organization,
including but not limited to Baxter (if it then engages in or owns, invests in,
operates, manages or controls any venture or enterprise which engages or
proposes to engage in any business conducted by the Company or any of its
subsidiaries), CSL, Octapharma, Grifols, Biotest, Kedrion, Kamada and Sanguine
or otherwise assist any person or entity that engages in or owns, invests in,
operates, manages or controls any venture or enterprise which engages or
proposes to engage in any business conducted by the Company or any of its
subsidiaries on the date of the Executive’s termination of employment or within
eighteen (18) months of the Executive’s termination of employment in the
geographical areas of: (i) Johnston and Wake Counties, North Carolina; (ii) the
State of North Carolina; (iii) the states of Pennsylvania, California, New
York and Florida; (iv) the United States of America; and (v) any
geographic locations where the Company and its subsidiaries engage, in such
business (the “Business”). 
Notwithstanding the foregoing, nothing in this Agreement shall prevent
the Executive from owning for passive investment purposes not intended to
circumvent this Agreement, less than five percent (5%) of the publicly traded
common equity securities of any company engaged in the Business (so long as the
Executive has no power to manage, operate, advise, consult with or control the
competing enterprise and no power, alone or in conjunction with other
affiliated parties, to select a director, manager, general partner, or similar
governing official of the competing enterprise other than in connection with
the normal and customary voting powers afforded the Executive in connection
with any permissible equity ownership).

 

6.4.         Property.  The Executive acknowledges that all originals
and copies of materials, records and documents generated by his or coming into
his possession during his employment by the Company or its subsidiaries and
which relate to the business of the Company or its subsidiaries (excluding this
Agreement and other documents relating to Executive’s employment relationship
with the Company) are the sole property of the Company and its subsidiaries (“Company
Property”).  During the Term, and at all
times thereafter, the Executive shall not remove, or cause to be removed, from
the premises of the Company or its subsidiaries, copies of any record, file,
memorandum, document, computer related information or equipment, or any other
item relating to the business of the Company or its subsidiaries, except in
furtherance of his duties under the Agreement. 
When the Executive’s employment with the Company terminates for any reason,
or upon request of the Company at any time, the Executive shall promptly
deliver to the Company all copies of Company Property in his possession or
control.

 

13

 

6.5.     Sections 6.1, 6.2, 6.3, and
6.4 of this Agreement, including each provision within those sections, are
independent and severable.  In the event
that a court of competent jurisdiction finds any provision of Sections 6.1,
6.2, 6.3, and 6.4 of this Agreement to be overbroad or unenforceable for any
reason, Executive and Company hereby specifically agree and request that the
court modify each such provision in a manner that will make each such provision
enforceable to the maximum extent allowed by law.

 

7.     Remedies;
Specific Performance.  The Parties
acknowledge and agree that the Executive’s breach or threatened breach of any
of the restrictions set forth in Section 6 will result in irreparable and
continuing damage to the Protected Parties for which there may be no adequate
remedy at law and that the Protected Parties shall be entitled to equitable
relief, including specific performance and injunctive relief as remedies for
any such breach or threatened or attempted breach.  The Executive also agrees that such remedies
shall be in addition to any and all remedies, including damages, available to
the Protected Parties against him for such breaches or threatened or attempted
breaches.  In addition, without limiting
the Protected Parties’ remedies for any breach of any restriction on the
Executive set forth in Section 6, except as required by law, the Executive
shall not be entitled to any payments set forth in Sections 5.2, 5.3, 5.4, and
5.5 hereof if the Executive has breached the covenants applicable to the
Executive contained in Section 5.9 or 6, the Executive will immediately
return to the Protected Parties any such payments previously received under
Sections 5.2, 5.3, 5.4, and 5.5 upon such a breach, and, in the event of such
breach, the Protected Parties will have no obligation to pay any of the amounts
that remain payable by the Company under Sections 5.2, 5.3, 5.4, and 5.5.

 

8.     Indemnification.  The Company agrees, to the extent permitted
by applicable law and its organizational documents, to indemnify, defend and
hold harmless the Executive from and against any and all losses, suits,
actions, causes of action, judgments, damages, liabilities, penalties, fines,
costs or claims of any kind or nature (“Indemnified Claim”), including
reasonable legal fees and related costs incurred by Executive in connection
with the preparation for or defense of any Indemnified Claim, whether or not
resulting in any liability, to which Executive may become subject or liable or
which may be incurred by or assessed against Executive, relating to or arising
out of his employment by the Company or the services to be performed pursuant
to this Agreement, provided that: (i) the Company shall only defend but
not indemnify or hold Executive harmless from and against an Indemnified Claim
in the event there is a final, non-appealable determination that Executive’s
liability with respect to such Indemnified Claim resulted from Executive’s
gross misconduct or gross negligence; and (ii) in the event that the
Executive’s actions, inactions, decisions or directions which gave rise to the
Indemnified Claim were outside the scope of his authority or were plainly
contrary to instructions provided him by the Board then the Company shall not
be obligated to either defend or indemnify Executive for the Indemnified Claim
and its responsibilities under this Section of the Agreement are null and
void.

 

9.     Other
Provisions.

 

9.1.     Notices.  Any notice or other communication required or
which may be given hereunder shall be in writing and shall be delivered
personally, telegraphed, telexed, sent by facsimile transmission or sent by
certified, registered or express mail, postage prepaid or overnight mail and
shall be deemed given when so delivered personally, telegraphed, 

 

14

 

telexed, or sent by
facsimile transmission or, if mailed, four (4) days after the date of
mailing or one (1) day after overnight mail, as follows:

 

If
the Company, to:

 

Attn.:
Chief Executive Officer

P.O. 
Box 13887

79 TW Alexander Drive

4101 Research Commons

Research Triangle Park

Raleigh, NC  27709

Fax:  (919) 316-6669

 

If the Executive,

 

to the Executive’s home
address reflected in the Company’s records.

 

9.2.     Entire Agreement.  This Agreement contains the entire agreement
between the Parties with respect to the subject matter hereof and supersedes
all prior agreements, written or oral, with respect thereto.

 

9.3.     Representations and
Warranties by Executive.  The
Executive represents and warrants that he is not a party to or subject to any
restrictive covenants, legal restrictions or other agreements in favor of any
entity or person which would in any way preclude, inhibit, impair or limit the
Executive’s ability to perform his obligations under this Agreement, including,
but not limited to, non-competition agreements, non-solicitation agreements or
confidentiality agreements.

 

9.4.     Waiver and Amendments.  This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by the Parties or, in the
case of a waiver, by the party waiving compliance.  No delay on the part of any party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any waiver on the part of any right, power or privilege
hereunder, nor any single or partial exercise of any right, power or privilege
hereunder, preclude any other or further exercise thereof or the exercise of
any other right, power or privilege hereunder.

 

9.5.     Governing Law, Dispute
Resolution and Venue.  (a) This
Agreement shall be governed and construed in accordance with the laws of the
State of North Carolina.  (b)  The
parties agree irrevocably to submit to the exclusive jurisdiction of the United
States Federal District Court of North Carolina, Eastern Division, or if no
federal jurisdiction exists, to the state courts located in the city of
Raleigh, North Carolina for the purposes of any suit, action or other
proceeding brought by any party arising out of any breach of any of the
provisions of this Agreement and hereby waive, and agree not to assert by way
of motion, as a defense or otherwise, in any such suit, action, or proceeding,
any claim that it is not personally subject to the jurisdiction of the
above-named courts, that the suit, action or proceeding is brought in an
inconvenient forum, that the venue of the suit, action or proceeding is
improper, or that the provisions of this Agreement may not 

 

15

 

be
enforced in or by such courts.  In
addition, the parties agree to the waiver of a jury trial.

 

9.6.     Assignability by the Company
and the Executive.  This
Agreement, and the rights and obligations hereunder may not be assigned by the
Company or the Executive without written consent signed by the other party;
provided that the Company may assign the Agreement to any successor that
continues the business of the Company.

 

9.7.     Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.

 

9.8.     Headings.  The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning of terms contained herein.

 

9.9.     Severability.  If any term, provision, covenant or
restriction of this Agreement, or any part thereof, is held by a court of
competent jurisdiction of any foreign, federal, state, county or local
government or any other governmental, regulatory or administrative agency or
authority to be invalid, void, unenforceable or against public policy for any
reason, the remainder of the terms, provisions, covenants and restrictions of
this Agreement shall remain in full force and effect and shall in no way be affected
or impaired or invalidated.  The
Executive acknowledges that the restrictive covenants contained in Section 6
are a condition of this Agreement and are reasonable and valid in temporal
scope and in all other respects.

 

9.10.   Tax Withholding.  The Company or other payor is authorized to
withhold from any benefit provided or payment due hereunder, the amount of
withholding taxes due any federal, state or local authority in respect of such
benefit or payment and to take such other action as may be necessary in the
opinion of the Board to satisfy all obligations for the payment of such
withholding taxes.  The Executive
is solely responsible for the payment of any tax liability (including any taxes
and penalties arising under Code Section 409A) that Executive incurs as a
result of any payments or benefits that the Executive receives pursuant to this
Agreement.  The Company shall not have
any obligation to pay the Executive for any such tax liabilities, If at the
time of  Executive’s Separation from Service, the Executive is a “specified
employee” (within the meaning of Code Section 409A and Treas. Reg.
§1.409A-3(i)(2)), the Company will not pay or provide any “Specified
Benefits” (as defined herein) during the six-month period (the “409A Suspension
Period”) beginning immediately after the Executive’s Separation from
Service. For purposes of this Agreement, “Specified Benefits”
are any amounts or benefits that would be subject to Section 409A
penalties if the Company were to pay them, pursuant to this Agreement, on
account of the Executive ‘s Separation from Service.

 

Within
14 calendar days after the end of the 409A Suspension Period, the Company will make a
lump-sum payment to the Executive, in cash, in an amount equal to any payments
and benefits that the Company does not make on account of the 409A Suspension
Period.  At the close of the 409A
Suspension Period, the Executive will receive any remaining payments and
benefits due pursuant to Section 4 in accordance with the terms of that Section (as
if there had not been any suspension beforehand).  Notwithstanding the foregoing, in the event
that this Agreement or any payment or benefit paid to the 

 

16

 

Executive
hereunder is deemed to be subject to Section 409A of the Code, Executive
and the Company agree to negotiate in good faith to adopt such amendments that
are necessary to comply with Section 409A of the Code or to exempt such
payments or benefits from Section 409A of the Code.

 

IN WITNESS WHEREOF, the Parties hereto,
intending to be legally bound hereby, have executed this Agreement on November 6,
2008, as of September 5, 2008.

 

	
  EXECUTIVE

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/
  John F. Gaither, Jr.

  	
   

  
	
  Name:

  	
  John
  F. Gaither, Jr.

  	
   

  
	
  Title:

  	
  Executive
  Vice President, General Counsel, and Corporate Secretary

  	
   

  
	
   

  	
   

  
	
  Talecris
  Biotherapeutics Holdings Corp

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Lawrence D. Stern

  	
   

  
	
  Name:
  

  	
  Lawrence
  D. Stern

  	
   

  
	
  Title:
  

  	
  Chairman
  and

  	
   

  
	
   

  	
  Chief
  Executive Officer

  	
   

  
					

 

17Exhibit 10.26.2

 

 

	
   

  	
  Ms. Kari Heerdt

  Senior Vice President

  Human Resources

  79 TW Alexander Drive

  4101 Research Commons

  Research Triangle Park

  North Carolina  27709

  Telephone:  919-316-6543

  Facsimile:  919-316-6523

  

 

December 19,
2008

 

Mr. John
Perkins

20524
Southshore Drive

Cornelius,
NC 28031

 

Dear
John,

 

The purpose of this letter is to change the terms of your severance as
stated in your Employment Letter with the Company dated March 2, 2006
(copy enclosed).  With your consent, the
Company is modifying your Employment Letter with respect to the terms of
severance to ensure that you, referred to as the ‘Executive”, have severance
protection going forward, and that it complies with the new Internal Revenue
Code Section 409A.  The Company is
required to comply with Section 409A by December 31, 2008.  Violations of this section involve a 20% tax
penalty for executives, and affirmative tax reporting obligations under which
employers must disclose violations on W-2s. 
Accordingly, with your agreement, the following shall be your amended
severance terms with the Company:

 

1.             Severance
Benefits.  If at any
time:  (i) Talecris terminates your
employment without Cause (as defined below), or (ii) you resign from your
position with Good Reason (as defined below), you will be entitled to, subject
to the terms of this letter agreement, an amount in cash (the “Severance
Payment”) equal to one year’s current Base Salary plus the “bonus” defined in
your Employment Letter.  The Severance
Payment shall be paid to you in a lump sum within sixty (60) days of Separation
from Service.

 

2.             Definitions.   The following words and phrases have the
following meanings when used in this letter agreement:

 

a.             Cause.  “Cause” means (i) failure to perform the
duties and responsibilities of your position in a manner satisfactory to
Talecris, except that Cause does not include failure resulting from your
incapacity due to mental or physical illness or injury or from any permitted
leave required by law, (ii) your failure to comply with Talecris written
employment policies, (iii) your conviction of, or entering of a plea of
guilty or nolo contendere, to a felony; (iv) willful misconduct by you
that results in harm to Talecris financially, reputationally or otherwise,
and/or (v) your disqualification or bar by any governmental or
self-regulatory authority from serving in the capacity you are employed with
Talecris or your loss of any governmental license that is reasonably necessary
for you to perform your responsibilities at Talecris.

 

b.             Code.  “Code” means the Internal Revenue Code of
1986, as amended.

 

 

c.             Good Reason.  “Good Reason” shall
mean, without the Executive’s consent, (i) a material diminution in the
Executive’s “base compensation” within the meaning of Code Section 409A
and relevant authorities thereunder; or (ii) relocation of the Executive’s
office more than 50 miles from its location in Research Triangle Park, North
Carolina.  The Executive shall provide
notice to the Company of the existence of (i) through (ii) of this Section within
a period not to exceed ninety (90) days of the initial existence of the
condition, upon the notice of which the Company shall have a period of at least
thirty (30) days within which to cure any deficiency that would result in Good
Reason.

 

c.             Separation of Service.  For purposes of this Agreement, “Separation
from Service” shall mean the termination of services provided by Executive,
whether voluntary or involuntary, as determined by the Company in accordance
with Treas. Reg. §1.409A-1(h).  In
determining whether the Executive has experienced a Separation from Service,
the following provisions shall apply:

 

i.              A Separation from Service
shall occur when the Executive experiences a termination of employment with the
Company and any affiliate in which the Company has more than a 50% ownership
interest (together with the Company, the “Employer”), which shall be considered
to have occurred when the facts and circumstances indicate that either (i) the
Executive is not reasonably expected to perform further services for the
Employer after a certain date, or (ii) that the level of bona fide
services the Executive will perform for the Employer after such date (whether
as an employee or as an independent contractor) will permanently decrease to no
more than 20% of the average level of bona fide services performed by such
Executive (whether as an employee or an independent contractor) over the
immediately preceding 36-month period (or full period of services to the
Employer if the Executive has been providing services to the Employer for less
than 36 months).

 

ii.             If the Executive is on
military leave, sick leave, or other bona fide leave of absence, the employment
relationship between the Executive and the Employer shall be treated as
continuing intact, provided that the period of such leave does not exceed six
months, or longer, so long as the Executive retains a right to reemployment
with the Employer under an applicable statute or by contract.  If the period of leave exceeds six months and
the Executive does not retain a right to reemployment under an applicable
statute or by contract, the Executive will incur a Separation from Service as
of the first day immediately following the end of such six-month period.  However, where the Executive’s leave of
absence is due to his or her Disability, a 29-month period of absence will be
substituted for such six-month period. 
In applying the provisions of this paragraph, a leave of absence shall
be considered a bona fide leave of absence only if there is a reasonable
expectation that the Executive will return to perform services for the
Employer.

 

3.             Payment of Benefits.  The Severance Payment described in the
preceding section of this letter agreement shall be  contingent on Executive’s execution of a
valid Release in a form reasonably acceptable to the Company that becomes
irrevocable within sixty (60) days after Executive’s Separation from Service.

 

4.             Tax Withholding.  The Company or other payor is authorized to
withhold from any benefit provided or payment due hereunder, the amount of
withholding taxes due any federal, state or local authority in respect of such
benefit or payment and to take such other 

 

2

 

action as may be necessary
in the opinion of the Company to satisfy all obligations for the payment of
such withholding taxes.

 

5.             Compliance with Code Section 409A.  This Agreement is intended to comply with (or
be exempt from) Code Section 409A, and the Company shall have complete
discretion to interpret and construe this Agreement and any associated
documents in any manner that establishes an exemption from (or otherwise
conforms them to) the requirements of Code Section 409A.  If, for any reason including imprecision in
drafting, the Agreement does not accurately reflect its intended establishment
of an exemption from (or compliance with) Code Section 409A, as
demonstrated by consistent interpretations or other evidence of intent, the
provision shall be considered ambiguous and shall be interpreted by the Company
in a fashion consistent herewith, as determined in the sole and absolute
discretion of the Company.  The Company
reserves the right to unilaterally amend this Agreement without the consent of
the Executive in order to accurately reflect its correct interpretation and
operation, as well as to maintain an exemption from or compliance with Code Section 409A.  Nevertheless, and notwithstanding any other
provision of this Agreement, neither the Company nor any of its employees,
directors, or their agents shall have any obligation to mitigate, nor to hold
the Executive harmless from, any or all taxes (including any imposed under Code
Section 409A) arising under this Agreement.

 

6.             Effect on Other Agreements.  This agreement replaces and supersedes all
other and prior severance agreements between Executive and the Company, whether
written or oral or express or implied, that relate to severance benefits.  No representations, promises, assurances or
agreements have been made regarding the subject matter of this agreement, except
such as has been stated herein.

 

7.             Termination. This
Agreement shall terminate upon Executive’s death or employee’s disability
(defined as your inability by reason of
physical or mental impairment to perform your job duties for a period exceeding
12 consecutive weeks).  If this agreement is terminated by reason of
Executive’s death or disability, Executive or Executive’s dependents or estate
will be entitled to the payments and benefits afforded under the Company’s
employee benefit plans, and the Company will have no further obligations under
this agreement.

 

If
you accept these changes, please sign where indicated below and return a copy
of this letter to me so that we may place it in your personnel file.  If you have any questions, please feel free
to contact me.

 

Sincerely,

 

 

	
  /s/
  Kari Heerdt

  	
   

  
	
  Name:
  Kari Heerdt

  	
   

  
	
  Title:
  Senior Vice President

  	
   

  
	
  Human Resources

  	
   

  

 

3

 

I
accept the changes to my Employment Letter as stated above.

 

 

	
  /s/
  John Perkins

  	
   

  
	
  Name:
  John Perkins

  	
   

  
	
  Title: Executive Vice
  President and Chief Financial Officer

  	
   

  
	
   

  	
   

  
	
  December 28, 2008

  	
   

  
	
  Date

  	
   

  

 

 

	
  Cc:

  	
  Lawrence
  Stern

  
	
   

  	
  File

  

 

4

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