Document:

exv10w96

Exhibit
10.96

***Text Omitted and Filed Separately

with the Securities and Exchange Commission.

Confidential Treatment Requested

Under 17 C.F.R. Sections 200.80(b)(4)

and 240.24b-2.

AMENDMENT NO. 11 TO

AGREEMENT

     This Amendment No. 11 (“Amendment No. 11”) is entered into effective as of January 1, 2009
(the “Amendment Effective Date”), pursuant to and amending that certain Agreement between Gen-Probe
Incorporated, a Delaware corporation (“Gen-Probe”) and Novartis Vaccines & Diagnostics, Inc., a
Delaware corporation (“Novartis”; and collectively with Gen-Probe, the “parties”), dated as of June
11, 1998, as previously amended and supplemented (the “Agreement”). Capitalized terms used but not
defined herein shall have the meanings set forth in the Agreement.

Recitals

     A. Prior to April 19, 2006, the legal name of Novartis Vaccines and Diagnostics, Inc. was
Chiron Corporation. In this Amendment No. 11, Novartis Vaccines and Diagnostics, Inc. is referred
to as “Chiron” with respect to events prior to April 19, 2006.

     B. The parties entered into the Agreement pursuant to which, among other things, the parties
described their respective rights and obligations with respect to the development, manufacture,
marketing and distribution of Products in the Blood Screening and Clinical Diagnostic Fields.

     C. Subsequent to the execution of the Agreement, Chiron assigned its rights and obligations
under the Agreement with respect to the Clinical Diagnostic Field to Chiron Diagnostics
Corporation, which was subsequently acquired by Bayer Corporation. Chiron retained all rights and
obligations under the Agreement with respect to Blood Screening Products. This amendment is
effective as between Novartis and Gen-Probe with respect to Blood Screening Products only, and
nothing herein shall affect any rights or obligations of any person under the Agreement with
respect to the Clinical Diagnostic Field.

     D. The parties have discussed amending the Agreement and extending the Blood Screening Term,
in accordance with the provisions of this Amendment No. 11.

Agreement

     NOW, THEREFORE, for and in consideration of the mutual covenants and agreements set forth in
this Amendment No. 11, the parties agree as follows:

     1. Applicable Purchase Price.

          a. Section 1.2.1 of the Agreement shall be and is hereby amended to read as follows as it
applies to sales after January 1, 2009:

1

 

	 	1.2.1	 	With respect to each Initial Blood Screening Assay, and each
Future Blood Screening Assay which includes as a constituent element an assay
for HCV (other than those sold pursuant to Sections 3.1.4(b) or 3.6), and
except as set forth in Section 1.2.2 below, each to the extent sold after
January 1, 2009, an amount equal to the sum of:

	 	(a)	 	Fifty percent (50%) of Gen-Probe’s
Manufacturing Cost of such Blood Screening Assay, plus
	 
	 	(b)	 	The percentage specified in Attachment A for
the calendar year in which such Blood Screening Assay is sold,
multiplied by the Net Sales of such Blood Screening Assay for the
applicable period pursuant to Section 3.1.6(b).

          b. Section 1.2.3 of the Agreement shall be and is hereby amended to read as follows:

	 	1.2.3	 	With respect to each Future Blood Screening Assay that does
not include as a constituent element an assay for HCV sold after January 1,
2009, an amount equal to the sum of:

	 	(a)	 	Fifty percent (50%) of Gen-Probe’s
Manufacturing Cost of such Future Blood Screening Assay, plus
	 
	 	(b)	 	Fifty percent (50%) of Net Sales of such Blood
Screening Assay for the applicable period pursuant to Section 3.2.7(b)
(except that solely for the purpose of this Section 1.2.3 such sales
shall not include sales by any distributor of Chiron, but shall instead
include sales by Chiron to all such distributors, so long as the sales
price is within industry standards for distributor margins).

provided, however, that the percentage referred to in (b)
above shall be adjusted to reflect the value of patent rights contributed by
either party covering the marker which is the subject of such Future Blood
Screening Assay, with the amount of the adjustment determined by the
Supervisory Board based on the value of such patent rights and the degree of
exclusivity which is provided for the Future Blood Screening Assay, pursuant
to Section 3.2.8(c); and

provided, further, that the Supervisory Board may modify the
allowable deductions from Net Sales for Future Blood Screening Assays
approved by the parties.

2

 

     2. Blood Screening Instruments. Section 1.6 of the Agreement shall be and is hereby
amended by adding, at the end of the existing section, the following language:

Subject to the fulfillment of the conditions set forth in Attachment B, Blood
Screening Instruments shall also include the Panther Instrument now under
development by Gen-Probe, to be added as a new Blood Screening Instrument in
accordance with Section 3.3.8. The “Panther Instrument” shall have the meaning set
forth in Attachment B.

     3. Blood Screening Term. Section 1.7 of the Agreement shall be and is hereby amended
to read as follows:

“Blood Screening Term” shall mean the period commencing on the Effective
Date and expiring on June 30, 2025, subject to earlier termination pursuant to and
in accordance with the provisions of this Agreement.

     4. Payment of Applicable Purchase Price; Reports. Sections 3.1.6(b), 3.2.7(b), and
3.3.6(b) of the Agreement shall be and are hereby amended to provide: Novartis shall pay to
Gen-Probe the Applicable Purchase Price for Initial Blood Screening Assays, Future Blood Screening
Assays, and Blood Screening Instruments within thirty (30) days after the end of each calendar
month and concurrently with the written report required by Section 7.1. Section 7.1 shall be and
is hereby amended to reflect the agreed thirty (30) day reporting requirement.

     5. Payment of HIV Patent Royalties. Pursuant to Section 9.6 and subject to the
conditions of Attachment C, the parties agree to share the payment obligation of Novartis and
Gen-Probe for the license of HIV intellectual property rights
[...***...], as follows: [...***...].

     6. Non-Competition; New and Alternative Technologies. Sections 3.2.8(a)(i) and (ii)
of the Agreement shall be and hereby are deleted in their entirety and replaced with the following
provisions:

(i) New Technology. If a party or its Affiliate becomes aware of any new
or improved nucleic acid probe based assay method or products incorporating such
method, and/or instrumentation therefor, (collectively the “New Technology”) which
may reasonably be expected to offer technological advantages over the TMA Blood
Screening Assays provided for by this Agreement, and such party or its Affiliate
desires to develop or commercialize assay products for use in the Blood Screening
Field using such New Technology, then such party shall inform the other party in
writing and the parties shall discuss such New Technology and shall use good faith
efforts to reach agreement for the joint development and/or commercialization of
assay products in the Blood Screening Field incorporating the New Technology, which
agreement may include an adjustment of the Applicable Purchase Price for such
products.

***Confidential Treatment Requested

3

 

(ii) If the parties cannot reach agreement for the joint development and/or
commercialization of any assay product incorporating New Technology following good
faith negotiations in accordance with subsection (i) above, and Novartis or its
Affiliate is the person desiring to develop or commercialize assay products
incorporating the New Technology, Novartis or its Affiliate may proceed with product
development or commercialization only if Novartis grants Gen-Probe a license of the
Chiron IP Rights, on reasonable commercial terms similar to those granted Third
Parties, permitting Gen-Probe and its Affiliates to make, have made, use, sell, and
import under Gen-Probe’s brands and trademarks the Blood Screening Assays and Blood
Screening Instruments for use in the Blood Screening Field that are likely to be
adversely impacted by the introduction of such products (collectively, the “Impacted
Products”). The license to Gen-Probe for an Impacted Product shall be effective, on
a country-by-country basis and Impacted Product-by-Impacted Product basis, on the
date that is six months prior to the anticipated first commercial sale by Novartis
of an assay product incorporating the New Technology, provided that the license
shall also permit Gen-Probe and its Affiliates to undertake activities prior to such
date that are necessary to enable Gen-Probe to sell the Impacted Product as of such
date. Upon the effective date of Gen-Probe’s right to sell under the license,
Novartis’s rights under this Agreement with respect to the Impacted Products shall
be modified to be co-exclusive with the right of Gen-Probe and its Affiliates to
promote, market and sell the Impacted Products for use in the Blood Screening Field.
Gen-Probe and its Affiliates shall not have any right to develop or commercialize
Blood Screening Assays incorporating New Technology and/or Blood Screening
Instruments incorporating New Technology for use in the Blood Screening Field during
the Blood Screening Term except in collaboration with Novartis.

(iii) Alternative Technology Identified by Gen-Probe. If Gen-Probe or its
Affiliate becomes aware of an alternative technology or product that is reasonably
expected to substitute for or significantly reduce the need for nucleic acid probe
based assay methods in the Blood Screening Field (such as, by way of example and not
limitation, [...***...]) (collectively the “Alternative Technology”), and Gen-Probe
or its Affiliate desires to develop or commercialize products for use in the Blood
Screening Field using such Alternative Technology, then Gen-Probe shall inform
Novartis in writing and the parties shall discuss such Alternative Technology and
shall use good faith efforts to reach agreement on reasonable commercial terms for
the joint development and/or commercialization of products in the Blood Screening
Field incorporating such Alternative Technology pursuant to the collaboration
established by this Agreement. Gen-Probe or its Affiliate shall not have any right
to develop or commercialize products for use in the Blood Screening Field
incorporating Alternative Technology unless it has first offered Novartis the
opportunity to jointly participate in the development and commercialization of such
products on reasonable commercial terms.

***Confidential Treatment Requested

4

 

(iv) Alternative Technology Identified by Novartis. If Novartis or its Affiliate
becomes aware of an Alternative Technology and Novartis or its Affiliate desires to
develop or commercialize products for use in the Blood Screening Field using such
Alternative Technology, then Novartis shall inform Gen-Probe in writing. (For the
avoidance of doubt, therapeutic and prophylactic drugs and/or vaccines shall not be
considered Alternative Technology for purposes of this Agreement.) Novartis shall
have the option, at its sole discretion, of either: a) offering Gen-Probe the
opportunity to jointly participate in the development and commercialization of such
products on reasonable commercial terms (Option 1); or b) commercializing the
Alternative Technology by itself, without first offering Gen-Probe the opportunity
to jointly participate in the development and commercialization of such products
(Option 2). Novartis shall notify Gen-Probe of its election in writing when
notifying Gen-Probe of the Alternative Technology. Any notice of Novartis’ election
of Option 2 shall be delivered not less than 120 days prior to the first commercial
sale by Novartis or its Affiliate of the Alternative Technology product. If
Novartis elects Option 1, the parties shall discuss such Alternative Technology and
shall use good faith efforts to reach agreement on reasonable commercial terms for
the joint development and/or commercialization of products in the Blood Screening
Field incorporating such Alternative Technology pursuant to the collaboration
established by this Agreement.

(v) If Novartis or its Affiliate elects Option 1 with respect to the Alternative
Technology, but the parties are unable to reach agreement on commercially reasonable
terms for the joint development and/or commercialization of any product following
good faith negotiations, Novartis or its Affiliate may proceed with product
development or commercialization only if Novartis grants Gen-Probe a license of the
Chiron IP Rights, on reasonable commercial terms similar to those granted Third
Parties, permitting Gen-Probe and its Affiliates to make, have made, use, sell, and
import under Gen-Probe’s brands and trademarks the Impacted Products. The license
to Gen-Probe for an Impacted Product shall be effective on a country-by-country
basis and Impacted Product-by-Impacted Product basis as of the first date on which
(a) Novartis or its Affiliate has commenced sales in such country of the Alternative
Technology product and (b) the number of blood donations screened with an Impacted
Product in such country for any calendar quarter have declined as a result of the
introduction of the Alternative Technology product by at least [...***...] (the
“Option 1 Threshold Decline”) from the number of donations screened with such
Impacted Product in either (x) the quarter immediately proceeding Novartis’ written
notice to Gen-Probe of the Alternative Technology or (y) the corresponding quarter
for the prior calendar year. Upon the effective date of Gen-Probe’s right to sell
under the license, Novartis’s rights under the Agreement with respect to the
Impacted Product shall be modified to be co-exclusive with the right of Gen-Probe
and its Affiliates to promote, market and sell the Impacted Product for use in the
Blood Screening Field.

***Confidential Treatment Requested

5

 

(vi) If Novartis or its Affiliate elects Option 2 with respect to an Alternative
Technology other than [...***...], Novartis or its Affiliate may proceed with
product development or commercialization only if Novartis grants Gen-Probe a license
of the Chiron IP Rights, on reasonable commercial terms similar to those granted
Third Parties, permitting Gen-Probe and is Affiliates to make, have made, use, sell,
and import under Gen-Probe’s brands and trademarks the Impacted Products. The
license to Gen-Probe for an Impacted Product shall be effective on a
country-by-country basis and Impacted Product-by-Impacted Product basis as of the
first date on which (a) Novartis or its Affiliate has commenced sales in such
country of the Alternative Technology product and (b) the number of blood donations
screened with an Impacted Product in such country for any calendar quarter has
declined as a result of the introduction of the Alternative Technology product by at
least [...***...] from the number of donations screened with such Impacted Product
in either (x) the quarter immediately proceeding Novartis’ written notice to
Gen-Probe of the Alternative Technology or (y) the corresponding quarter for the
prior calendar year (the “Option 2 [...***...] Threshold”); provided that the
license shall permit Gen-Probe and is Affiliates to undertake activities prior to
such date that are necessary to enable Gen-Probe and is Affiliates to sell the
Impacted Product as of such date. If Novartis or its Affiliate elects Option 2 with
respect to an Alternative Technology for [...***...], the license to Gen-Probe shall
be effective on a country-by-country basis and Impacted Product-by-Impacted Product
basis as of the first date on which (a) Novartis or its Affiliate has commenced
sales in such country of the Alternative Technology product and (b) the number of
blood donations screened with an Impacted Product in such country for any calendar
quarter has declined as a result of the introduction of the Alternative Technology
product (the “Option 2 [...***...] Threshold”), and the Option 2 [...***...]
Threshold shall not apply. Upon the effective date of Gen- Probe’s right to sell
under a license, Novartis’s rights under this Agreement with respect to the Impacted
Product shall be modified to be co-exclusive with the right of Gen-Probe and is
Affiliates to promote, market and sell the Impacted Product for use in the Blood
Screening Field.

(vii) For purposes of this section 3.2.8(a), “country—by-country” shall mean, with
respect to Germany, the United Kingdom, France, and Italy (the “Major European
Markets”), each country individually and/or the four countries considered in the
aggregate. By way of example, the Option 2 [...***...] Threshold would be triggered
as to France as a result of the requisite percentage decline in the number of
screened blood donations in France and would also be triggered in France (and the
other Major European Markets) as a result of the requisite percentage decline in the
number of screened blood donations in the Major European Markets considered in the
aggregate.

***Confidential Treatment Requested

6

 

     7. Initiation of “Companion Diagnostic” Program. The parties will work together, on a
non-exclusive basis, to research and develop molecular diagnostic assays that could be used to help
identify patients who are likely to particularly benefit from medicines that Novartis or any of its
Affiliates is developing or marketing. To develop these potential “companion diagnostic” tests,
Novartis may contribute biomarkers discovered through its research efforts, and Gen-Probe will
provide its molecular diagnostics technologies and assay development expertise. Novartis will also
provide at least [...***...] in aggregate research funding to Gen-Probe in 2009 and 2010 in support
of initial research and development. The parties will establish development agreements on a
case-by-case basis, with the parties expecting to share revenues associated with any companion
diagnostic tests that are successfully commercialized.

     8. Other Provisions.

          a. Board Approval. Each of the undersigned executives represents that he has full corporate
authority to execute this Amendment No. 11 on behalf of Gen-Probe and Novartis, respectively,
subject only to approval by each party’s Board of Directors. This Amendment No. 11 shall not be
effective unless by January 23, 2009, each party’s Board of Directors has approved Amendment No. 11
and written notice of such approval has been delivered to the other party. If such written notice
of approval is not delivered by each party by January 23, 2009, this Amendment No. 11 shall be null
and void. Each party agrees to use its best efforts to present this Amendment No. 11 to its Board
within the time allowed and agrees to recommend that the Amendment No. 11 be approved.

          b. Public Announcement. Neither party will issue a public announcement without the prior
written consent of the other party, which shall not be unreasonably withheld. Notwithstanding the
foregoing sentence, a party may disclose the fact and terms of this Amendment No. 11 as required by
applicable laws, rules or regulations, including the rules of any stock exchange on which such
party’s securities are traded; provided that the disclosing party shall use commercially reasonable
efforts to provide reasonable advanced notice to allow the other party the opportunity to comment
as to the nature and extent of such disclosure and, consistent with its obligations under
applicable laws, rules or regulations, the disclosing party shall reasonably consider such
comments..

          c. Restated Agreement. The parties will in good faith negotiate a Restated Agreement
incorporating this Amendment No. 11 and all prior amendments and supplemental agreements within
[...***...] of the Amendment Effective Date. The parties agree that any dispute concerning the
incorporation of this Amendment No. 11 and all prior amendments and supplemental agreements into
the Restated Agreement shall be subject to Section 13.1, but not Section 13.2 of the Agreement.
Article 13 shall remain in full force and effect as to all other controversies and claims under the
Agreement, this Amendment No. 11, and all prior amendments and supplemental agreements.

***Confidential Treatment Requested

7

 

     9. No Other Amendment. Except as is expressly set forth in this Amendment No. 11, all
other terms and conditions of the Agreement shall continue in full force and effect.

     10. Counterparts. This Amendment No. 11 may be executed in counterparts, each of
which shall be an original, and all of which together shall constitute one and the same instrument.

     IN WITNESS WHEREOF, the parties have caused this Amendment No. 11 to be executed and the
persons signing below warrant that they are duly authorized to sign for and on behalf of the
respective parties, subject to Section 13.a.

	 	 	 	 	 	 	 	 	 	 	 
	GEN-PROBE INCORPORATED	 	NOVARTIS VACCINES & DIAGNOSTICS, INC.
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	/s/ Henry L. Nordhoff
 

Henry L. Nordhoff	 	By:	 	/s/ Andrin Oswald, M.D.
 

Andrin Oswald, M.D.
	 

	 	Its:
	 	Chief Executive Officer
	 	 	 	Its:
	 	 Chief Executive Officer
	 

	 	Date:
	 	January 15, 2009
	 	 	 	Date:
	 	January 22, 2009

8

 

Attachment
A

Percentages for Use in Calculating

Applicable Purchase Price Pursuant to Section 1.2.1

	 	 	 
	Calendar Year	 	Applicable Percentage
	2009
	 	44%
	2010
	 	46%
	2011
	 	46%
	2012
	 	47%
	2013
	 	47%
	2014
	 	48%
	2015 and all subsequent years 

during the Blood Screening Term
	 	50%

9

 

Attachment B

Terms and Conditions for the Development

of the Panther Instrument for the Blood Screening Field

     Gen-Probe has commenced development of the Panther Instrument for clinical diagnostic use.
The “Panther Instrument” shall mean an integrated, fully-automated low to mid volume molecular
diagnostic instrument system designed to be able to process the Blood Screening Assays, currently
anticipated to have the following features: anticipated throughput of [...***...] tests in
[...***...]; continuous access to samples and reagents; and an estimated transfer price from the
manufacturer of approximately [...***...].

     The instrument system and the instrument development plan for the Panther Instrument will need
to be modified to permit use of the instrument system in the Blood Screening Field.

     Gen-Probe will not be required to commence development of the blood screening version of the
Panther Instrument System prior to [...***...], but will use commercially reasonable efforts to
commence development promptly following the execution of a Panther Addendum. The parties will use
their best efforts to negotiate in good faith and execute a Panther Addendum within [...***...]
following the execution of this Amendment No. 11. When executed, the Panther Addendum will
obligate Novartis to pay Gen-Probe up to a maximum of [...***...] toward reimbursement of the costs
of modification of the Panther Instrument for use in the Blood Screening Field (in accordance with
the methodology previously agreed between the parties for development costs for Future Blood
Screening Assays.) Until Novartis has paid Gen-Probe [...***...], Novartis will be solely
responsible for the costs incurred for development of the Panther Instrument as a Blood Screening
Instrument. Once Novartis has paid Gen-Probe [...***...], Gen-Probe will be solely responsible for
the costs incurred for further development of the Panther Instrument as a Blood Screening
Instrument. “Development” of the instrument will be deemed complete upon completion of R&D
validation and verification of the instrument and the manufacturer’s release of the instrument
design for manufacturing. Following completion of development, the parties will share the cost of
clinical trials for the Panther Instrument and for Blood Screenings Assays on the Panther
Instrument. Following completion of development, the parties will also share the cost of any
agreed continuing improvement programs for the Panther Instrument.

Prior to the date of this Agreement, Gen-Probe has expended significant effort and resources in the
development of the Panther Instruments for use in the Clinical Diagnostic Field. The [...***...]
cap on Novartis’s obligation for Panther Instrument development costs applies to the instrument
specifications as of the date of Amendment No. 11, with such minimal additional development work as
is required to modify the existing specifications for use in the Blood Screening Field. The cap
does not apply if and to the extent the parties agree to additional modifications of the Panther
Instrument specifications.

***Confidential Treatment Requested

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     The Panther Addendum will include, generally, provisions for management of product development
comparable to those included in other new product development addendum previously agreed between
the parties for Future Blood Screening Assays. The Addendum will specify the requirements for the
Panther Instrument and will require delivered instruments to meet all agreed specifications. Other
than as expressly set forth herein, the parties’ rights and obligations with respect to the Panther
Instrument shall be established solely by the Panther Addendum.

     After Novartis has received revenue equal to the Transfer Price paid to Gen-Probe for any
Panther Instrument, Novartis shall pay to Gen-Probe an amount equal to fifty percent (50%) of all
revenue attributable to any sale, lease and/or placement of such Panther Instrument with an
independent customer by Novartis and its Affiliates in the Territory (notwithstanding any provision
to the contrary in section 3.3.6 of the Agreement). Novartis shall be entitled to retain all
revenue received by Novartis and its Affiliates in consideration for the maintenance and servicing
of the Panther Blood Screening Instruments, not to exceed commercially reasonable amounts
consistent with standard industry practice in the diagnostic and/or blood screening markets.

     Novartis shall pay an additional Technology Access Fee to Gen-Probe in the amount of
[...***...] upon the earlier to occur of (1) FDA approval of the Panther Instrument for use in the
Blood Screening Field in the United States, (ii) authorization to “CE Mark” the Panther Instrument
for use in the Blood Screening Field in the European Economic Area, or (iii) the authorized first
commercial sale of the Panther Instrument for use in the Blood Screening Field.

***Confidential Treatment Requested

11

 

Attachment
C

Conditions For Gen-Probe’s Agreement

To Contribute To HIV Patent Payments

[...***...]

***Confidential Treatment Requested

12

 

[...***...]

***Confidential Treatment Requested

13exv10w98

Exhibit 10.98

2009 GEN-PROBE EMPLOYEE BONUS PLAN

	I.	 	INTRODUCTION

	 	A.	 	Purpose: The 2009 Gen-Probe Employee Bonus Plan (the “Plan”) is
designed to encourage and financially reward eligible employees for their
contributions to the success and profitability of Gen-Probe Incorporated.

	 
	 	B.	 	Effective Date: The Plan shall begin January 1, 2009 and continue
through December 31, 2009 (the “Plan Year”).

	 
	 	C.	 	Entire Agreement: The Plan is the entire statement regarding the
subject matter hereof and supersedes all prior bonus or incentive plans or any
written or verbal representations regarding the subject matter of the Plan.

	 
	 	D.	 	No Guarantee of Compensation: Nothing in the Plan is intended to be
a guaranty of any kind of compensation or any other binding commitment of
Gen-Probe Incorporated.

	II.	 	PLAN DEFINITIONS

	 	A.	 	The Plan: The 2009 Gen-Probe Employee Bonus Plan.

	 
	 	B.	 	Participant: Participant is defined as any regular, full-time or
part-time employee of Gen-Probe Incorporated or its Designated Subsidiaries
(together, the “Company”) hired on or before September 30, 2009 who is not a
participant in any other Company bonus or incentive plan (excluding the Company’s
option plans, 401(k) plan and employee stock purchase plan). For employees of the
Company that are hired during the Plan Year as a result of an acquisition,
eligibility for participation in the Plan will be determined on a deal-by-deal
basis. As used herein, Designated Subsidiaries shall mean Gen-Probe Sales &
Service, Inc., Gen-Probe International, Inc. and such other direct or indirect
subsidiaries of Gen-Probe Incorporated as may be designated a Designated
Subsidiary by Administrator.

	 
	 	C.	 	The Administrator: The Administrator of the Plan shall be the
Compensation Committee of the Board of Directors of Gen-Probe Incorporated,
provided that the Chief Executive Officer of the Company shall be the
Administrator for purposes of Section III.I of the plan solely with respect to
employees other than executive officers of the Company. The Compensation
Committee shall approve all bonus payments to executive officers.

	 
	 	D.	 	Company Performance Factor (CPF): The CPF is a percentage from 0% to
150% and is applied to a portion of each Participant’s bonus target. The CPF is
determined based on the achievement of specific goals, set forth on Exhibit C.
Each of the goals is assigned a Threshold, Target, and Stretch metric, and a
weighting based on the relative importance or potential impact of the goal on the
Company. The total weighting of the goals equals 100%.

 

 

	 	 	 	The score for each goal is determined based on the actual achievement of the goal,
on a linear basis from Threshold to Target and Target to Stretch. Achievement of a
goal at Target would yield a score for that goal of 100%. Achievement of a goal
below the Threshold level would yield a score of 0%, at Threshold 80% and equal to
or above Stretch, a score of 150%. In order to calculate the overall CPF, the
score for each goal is multiplied by the goal weighting. The sum of the weighted
scores equals the CPF.

	 
	 	E.	 	Individual and Team Performance Factor (ITPF): The ITPF is a
percentage from 0% to 150% and is applied to a portion of each Participant’s
Target Bonus. Each Participant will be assigned an ITPF based on his or her
overall performance, including performance on core teams and/or functional teams.

	 
	 	F.	 	Target Bonus Percentage and Weighting: The target bonus percentage,
and CPF and ITPF weighting is based on the Participants compensation band and
according to the percentages set forth on (i) Exhibit A with respect to position
levels OE through Senior Director and (ii) Exhibit B with respect to Vice
Presidents and Senior Vice Presidents.

	 
	 	G.	 	Base Pay: “Base Pay” under the Plan is defined as the annual base
pay in effect on December 31, 2009. For Participants who are exempt employees,
base pay is defined as annual base salary. For Participants who are overtime
eligible employees, base pay is defined as the hourly rate in effect on December
31, 2009 multiplied by the number of regularly scheduled work hours during the
Plan Year (part-time employees) or 2,080 (full time employees), plus any overtime
pay earned during the Plan Year.

	III.	 	BONUS PLAN ADMINISTRATION

	 	A.	 	Bonus Payment: Participants must be employed by the Company on the
last day of the Plan Year and on the date the bonus, if any, is paid, in order to
be eligible for a bonus payout. Bonuses will typically be paid within 90 days
after the end of the Plan Year and are subject to applicable payroll and other
withholding taxes.

	 
	 	B.	 	Pro-rated Bonuses: Bonus payments to Participants with less than a
full year of eligible participation will be pro-rated based on full months of
participation. Bonuses will also be pro-rated for Participants with only partial
year eligibility due to participation in other Company bonus or incentive plans.

	 
	 	C.	 	Bonus Calculation: Bonuses will be calculated using the following
formula:

	 
	 	 	 	(Base Pay x Target % x CPF x CPF Weighting) + (Base Pay x Target % x ITPF x ITPF
Weighting) = Bonus

	 
	 	D.	 	Bonus Calculation Example:

	 
	 	 	 	Assume a Participant with a base salary of $50,000; target bonus of 5% and CPF and
ITPF weightings of 30% and 70% respectively; CPF = 110%; ITPF = 100%.

	 
	 	 	 	($50,000 x 5% x 110% x 30%) + ($50,000 x 5% x 100% x 70%) = $2,575

	 
	 	E.	 	Transfers and Promotions: Participants who transfer or are promoted
to a non-eligible position or to another target bonus percentage will be eligible
for a pro-rated bonus based on the length of time of Plan eligibility or in each position, as
applicable. Participants who were in positions not eligible under the Plan and
transfer or are promoted to an eligible position will be eligible for a pro-rated
bonus based on the length of time in the bonus eligible position.

 

 

	 	F.	 	Leaves of Absence: Bonuses will be pro-rated for each full month of
absence during any approved leave of absence. Participants on an approved leave of
absence at the time of payout will have their bonus checks mailed to their home.

	 
	 	G.	 	Performance Improvement Plans: Participants not performing at an
acceptable level or who are deemed not in good standing by management at the time
of payout are not eligible to receive a bonus payment, regardless of performance
during the Plan Year.

	 
	 	H.	 	Termination of Employment: Participants whose employment terminates
either voluntarily or involuntarily prior to the end of the Plan Year or prior to
the date of payout will not be eligible for a bonus payment.

	 
	 	I.	 	Approval of Bonuses. All proposed bonus payments are submitted to
the Administrator for final approval. The Administrator may determine which
Participants shall be granted bonus awards and may adjust the final bonus amount
for any Participant (including increasing or decreasing any bonus from the
calculation set forth in Section III.C above) as it deems appropriate. The
Administrator has complete discretion to adjust bonus awards to reflect changes in
the industry, Gen-Probe Incorporated’s financial performance, a Participant’s job
duties or performance, or any other circumstance the Administrator determines
should impact bonus awards.

	 
	 	J.	 	Administrative Matters and Plan Interpretation: The Administrator is
responsible for administering the Plan. The Administrator has all powers and
discretion necessary or appropriate to review and approve the Plan and its
operation, including, but not limited to, the power to (a) interpret the Plan, (b)
adopt rules for the administration, interpretation and application of the Plan as
are consistent herewith, and (c) interpret, amend or revoke any such rules. All
determinations and decisions made by the Administrator and any delegate of the
Administrator shall be final, conclusive, and binding on all persons, and shall be
given the maximum deference permitted by law. The Administrator, in its sole
discretion, may amend or terminate the Plan, or any part thereof, at any time and
for any reason.

	 
	 	K.	 	Employment at Will: Nothing contained in the Plan will alter a
Participant’s at-will employment relationship with the Company. Employment with
the Company is entered into voluntarily and employees are free to resign at any
time for any reason, with or without advance notice. Similarly, the Company can
terminate employment at any time for any reason, with or without advance notice
and with or without cause. The Company may establish separate procedures for
Participants who are employed outside the United States in order to comply with
applicable laws, rules or regulations of such foreign jurisdictions with respect
to tax, currency, employee benefits or other matters.

 

 

Exhibit A

Target bonus percentages for all employee levels through Senior Director

[Intentionally omitted]

 

 

Exhibit B

Target bonus percentage for Vice Presidents and Sr. Vice Presidents

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Weighting
	Career Level	 	Target %	 	CPF	 	ITPF
	Vice President
	 	 	30	%	 	 	70	%	 	 	30	%
	Sr. Vice President
	 	 	35	%	 	 	70	%	 	 	30	%

 

 

Exhibit C

2009 Company Performance Metrics

[Intentionally omitted]

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