Meridian Bioscience, Inc. (NASDAQ:VIVO) and John A. Kraeutler, the Company’s Chairman of the Board of Directors, Chief Executive Officer and President, entered into a Third Amended and Restated Employment Agreement (the “Employment Agreement“) which, among other things, extends the term of his employment and incorporates the terms and conditions of the Supplemental Benefit Agreement entered into between the Company and Mr. Kraeutler dated June 12, 2012 (the “Supplemental Benefit Agreement“). The Employment Agreement provides that Mr. Kraeutler is entitled to receive an established minimum annual salary of $656,518 and that he is eligible to participate in the Company’s bonus and stock incentive plans. The Employment Agreement also provides that Mr. Kraeutler is eligible to receive two grants of 25,000 performance-based restricted stock units and that he shall receive a grant of 50,000 non-qualified stock options vesting on September 30, 2017 as long as he is employed on that date, and a grant of 50,000 non-qualified stock options vesting on September 30, 2018 as long as he is employed on that date.
In addition, the Employment Agreement provides that Mr. Kraeutler is eligible to receive:
Post-retirement benefit payments totaling $1,200,000, payable in one hundred twenty (120) monthly payments of $10,000 (Mr. Kraeutler’s rights to these benefit payments have vested since their provision in the Supplemental Benefit Agreement); and lifetime benefits including life insurance, health insurance and comprehensive long-term care insurance.
The Employment Agreement’s term extends through September 30, 2018 and provides for a consulting period during which Mr. Kraeutler is required to be available to assist his successor.
The Employment Agreement sets forth compensation, non-competition, benefit and severance provisions. It provides for a payment equal to three times Mr. Kraeutler’s base salary (plus any salary earned but not paid) and three-year average annual performance bonus if Mr. Kraeutler is terminated (a) by the Company without Cause, (b) Mr. Kraeutler terminates his employment for Good Reason or (c) upon a change in control of the Company (double trigger).
The foregoing description of the Employment Agreement does not purport to be complete and is qualified in its entirety by reference to the Employment Agreement, which is filed as Exhibit 10.1 to this Form 8-K and incorporated into this Item 5.02 by reference. Please see the Employment Agreement attached as an exhibit to this Form 8-K for further information.