8-KLeadership ChangesExhibits & Filings

THERMO FISHER SCIENTIFIC INC. 8-K Report, Executive Changes (Apr 10, 2008)

Filed April 10, 2008For Securities:TMO

Summary

Thermo Fisher Scientific Inc. (TMO) has filed an 8-K report detailing an amended and restated employment agreement with its President and CEO, Marijn E. Dekkers, effective April 7, 2008. This agreement establishes terms through December 31, 2017, setting an annual base salary of $1,165,000 and a target annual incentive bonus of 125% of base salary, with actual payout ranging from zero to two times the target. The agreement also outlines significant severance benefits for Mr. Dekkers in the event of termination without cause, by Mr. Dekkers with good reason, death, or disability. These benefits include substantial salary and bonus payouts, continuation of medical and dental insurance, and outplacement services, as well as accelerated vesting of stock options and lapse of transfer restrictions on restricted stock under specific termination scenarios. The filing also notes Mr. Dekkers' agreement regarding stock option acceleration upon a change in control and amendments to a recent stock option grant.

Key Highlights

  • 1Amended and restated employment agreement for CEO Marijn E. Dekkers, extending to December 31, 2017.
  • 2Annual base salary set at $1,165,000.
  • 3Target annual incentive bonus is 125% of base salary, with potential payouts ranging from 0% to 200% of the target.
  • 4Significant severance package for termination without cause or by CEO with good reason, including 3x base salary, 3x target bonus, pro-rata bonus, extended benefits, and outplacement services.
  • 5Specific provisions for termination due to disability or death, including base salary continuation, pro-rata bonus, and extended medical/dental benefits.
  • 6Accelerated vesting of stock options and removal of transfer restrictions on restricted stock under certain termination events (death, disability, termination without cause, termination by CEO with good reason).
  • 7Agreement on stock option acceleration related to change in control, with specific provisions for restricted stock vesting prior to March 1, 2008.

Frequently Asked Questions

The agreement sets an annual base salary of $1,165,000 and a target annual incentive bonus of 125% of his base salary. The actual bonus payout can range from 0% to 200% of the target amount. The agreement also specifies terms for equity grants determined by the Compensation Committee.

If terminated by the Company without 'cause' or by Mr. Dekkers with 'good reason,' he is entitled to three times his then-current base salary, three times his target bonus, a pro-rata bonus for the year of termination, up to three years of medical and dental insurance, and up to $50,000 in outplacement services. Termination due to disability or death also includes severance benefits, though different in nature and duration.

In the event of death, disability, termination without cause, or termination by CEO with good reason, all stock options become fully vested and exercisable for a period of up to three years from termination (but not beyond their original expiration). Transfer restrictions on time-based restricted stock also lapse. In the event of a change in control, restricted stock granted prior to March 1, 2008, will vest. However, Mr. Dekkers has agreed that his outstanding stock options will not automatically accelerate upon a change in control.

If terminated for 'cause,' no further stock options will vest, and he will have a limited window (10 days, or 90 days for options granted before 2005) to exercise vested options. All restricted stock for which transfer restrictions have not lapsed will be forfeited. Similar consequences apply if he resigns without 'good reason'.