01—Abstract
Summary
Summary of the 8-K filed December 6, 2024. Cited figures are marked; the original filing is the authoritative source.
On December 6, 2024, Natera, Inc. filed a Form 8-K under Item 5.02 disclosing an Amended and Restated Employment Agreement with Matthew Rabinowitz, Ph.D., the Executive Chairman and Co-Founder.
The agreement, entered into December 2, 2024 and effective November 1, 2024, amends and restates his prior employment agreement, which was set to expire. Dr. Rabinowitz will continue as Executive Chairman on an at-will basis. Under the new terms, his annual base salary equals 50%a of the CEO's base salary, and he is eligible for an annual cash bonus of 85% of base salary tied to performance goals set by the Board or Compensation Committee.
He will also receive annual long-term equity awards with a dollar value equal to 80%b of the CEO's annual equity award value, split between time-based and performance-based vesting in the same proportions as the CEO's awards, under the 2015 Equity Incentive Plan. The filing describes enhanced severance protections. On involuntary termination, he would receive a lump sum of 12 months' base salary, increased to 18 months within 12 months after a change in control, plus COBRA premium support and partial or full accelerated vesting of equity awards depending on the award type and whether a change in control termination occurs.
Severance is subject to a release agreement. The full agreement is to be filed as an exhibit to the company's 2024 Form 10-K.
02—Key points
Key Highlights
- Matthew Rabinowitz, Ph.D., Executive Chairman and Co-Founder, signed an Amended and Restated Employment Agreement effective November 1, 2024, replacing his prior agreement.
- Base salary is set at 50% of the CEO's annual base salary, with an annual cash bonus target of 85% of base salary.
- Annual long-term equity awards have a dollar value equal to 80% of the CEO's annual equity award value, under the 2015 Equity Incentive Plan.
- Involuntary termination severance is a lump sum of 12 months' base salary, rising to 18 months plus a target-level annual bonus if the termination occurs within 12 months after a change in control.
- Severance includes COBRA premium payments for 12 months (18 months after a change in control) and accelerated equity vesting, with a minimum of 50% of unvested time-based awards in a non-change-in-control termination.
- Severance obligations are conditioned on Dr. Rabinowitz signing and the release becoming effective.
- The full agreement will be filed as an exhibit to the Form 10-K for the year ending December 31, 2024.
03—Questions
Frequently Asked Questions
What did Natera change in its arrangement with Dr. Rabinowitz?
The company entered into an Amended and Restated Employment Agreement with Dr. Rabinowitz, effective November 1, 2024, which replaces the prior agreement dated June 7, 2007, as amended in 2021 and 2023. He will continue as Executive Chairman on an at-will basis.
How is Dr. Rabinowitz's compensation structured?
His annual base salary is 50% of the CEO's base salary. He is eligible for an annual cash bonus equal to 85% of base salary based on performance goals, and annual long-term equity awards with a dollar value equal to 80% of the CEO's annual equity award value.
What severance would he receive on involuntary termination?
He would receive a lump-sum payment equal to 12 months' base salary, or 18 months if the termination occurs within 12 months after a change in control, plus COBRA premium payments for 12 months (18 months in a change in control termination). Equity vesting acceleration also applies, and severance is conditioned on signing a release.
Where can investors find the full terms of the agreement?
The filing states that the full text of the Amended and Restated Employment Agreement is intended to be filed as an exhibit to the company's annual report on Form 10-K for the year ending December 31, 2024.
04—Continue