VP Business Development and Strategic Planning Employment Agreement - Russell S. Bradley

EMPLOYMENT AGREEMENT


THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into as of May 23, 2005 (the "Effective Date") by and between LUMINEX CORPORATION, a Delaware corporation ("Luminex") and RUSSELL S. BRADLEY ("Executive").


RECITAL


WHEREAS, Executive is to be employed as the Vice President, Business Development and Strategic Planning for Luminex;


WHEREAS, Luminex and Executive wish to document the terms of the employment of Executive in such capacity; and


WHEREAS, Executive has represented to Luminex and Luminex has relied on Executive's representation that the execution of this Agreement by Executive, and the provision of services by Executive to Luminex as contemplated in this Agreement, will not conflict with, or cause Executive or any other person or entity to be in breach of, (i) any other contract to which Executive is a party or (ii) any duty which Executive may owe to any other person or entity.


AGREEMENT


NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:


1. DUTIES.


1.1 Duties. During the term of this Agreement (including all renewal periods, if any, the "Term"), Executive agrees to be employed by and to serve Luminex as Vice President, Business Development and Strategic Planning and Luminex agrees to employ and retain Executive in such capacity subject to the provisions of this Agreement. Executive shall have such powers, authority and duties, and shall render such services of executive and administrative character, or act in such other capacity for Luminex, as the Chief Executive Officer or the Board of Directors of Luminex (the "Board") shall from time to time lawfully direct and Executive shall report directly to the Chief Executive Officer of Luminex. Executive shall devote all of his business time, energy, and skill to the business of Luminex;


2. TERM AND TERMINATION.


2.1 Term. Subject to Section 2.2, the term of employment of Executive by Luminex shall be one (1) year commencing on the Effective Date and shall thereafter automatically renew for successive additional one-year terms unless either party provides the


other with written notice of its intent not to renew this Agreement at least sixty (60) days prior to the end of the Term (unless terminated earlier pursuant to the provisions of this Agreement).


2.2 Termination of Employment.


2.2.1 Termination For Cause. "Termination For Cause" shall mean the termination by Luminex of Executive's employment with Luminex as the result of Executive's material fraud upon Luminex or Executive's continued material breach of this Agreement after receipt of written notice from Luminex specifying such breach and failure by Executive to cure such breach within fifteen (15) days from receipt of such notice. Executive's inability to perform his obligations under this Agreement despite his best efforts as a result of a permanent or temporary disability (as evidenced by a written determination from a physician chosen by Executive and reasonably acceptable to Luminex) shall not result in a Termination For Cause. In the event that Executive fails to cure the breach within the fifteen (15) day cure period, the termination shall be effective as of the date that Luminex notifies Executive of his termination following the expiration of the fifteen (15) day cure period. Upon any Termination For Cause, Executive shall be paid the Accrued Obligations (defined below) within three (3) business days following the effective date of termination.


2.2.2 Termination Other Than For Cause. "Termination Other Than For Cause" shall mean (i) termination by Luminex of Executive's employment with Luminex for any reason other than Termination For Cause, Termination by Reason of Death, Termination by Reason of Incapacity or Termination Upon Expiration of Agreement or (ii) termination by Executive upon constructive termination of Executive's employment with Luminex by reason of (A) a reduction in Executive's Base Salary (defined below); (B) a reduction in Executive's title from Vice President, Business Development and Strategic Planning for Luminex (whether by reason of Executive's removal from any of such offices or Luminex's failure to reappoint Executive to any of such offices); (C) a Material Diminution (defined below); (D) a requirement that Executive change his principal place of business to a location that is outside the Office Area (defined below), or (E) Luminex's continued material breach of this Agreement after receipt of written notice from Executive specifying such breach and failure by Luminex to cure such breach within fifteen (15) days from receipt of such notice. Termination Other Than For Cause may be effected by Luminex at any time by providing Executive with written notice of such termination. The termination shall be effective as of the date of the notice or such later date as may be determined by Luminex. Executive may also effect a Termination Other Than For Cause upon written notice to Luminex at any time any of the conditions for constructive termination set forth in clause (ii) above (including without limitation, if applicable, the expiration of the cure period) have been met. Upon any Termination Other Than For Cause, Executive shall be paid (i) within three (3) business days following the effective date of termination the amount of the Accrued Obligations and (ii) all severance compensation provided in Section 4.1. For purposes of this Agreement, "Material Diminution" means a material diminution by Luminex of Executive's duties, powers, authority, functions or responsibilities without Executive's consent, such that Executive is left with such duties, powers, authority, functions and responsibilities (when viewed in the aggregate) that are materially diminished compared to both (i) those duties,


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powers, authority, functions and responsibilities conferred upon Executive at the Effective Date and (ii) those duties, powers, authority, functions and responsibilities that are most typically conferred upon the employee vice president of business development and strategic planning of companies having both (i) an employee vice president of business development and strategic planning and (ii) revenues comparable to Luminex (based on the revenues of Luminex at the time of determination). Luminex and Executive agree that in the event there is an ambiguity with respect to the interpretation or application of the definition of "Material Diminution", such ambiguity shall be resolved according to the reasonable interpretation of such definition most favorable to Luminex. For purposes of this Agreement, "Office Area" means the geographical area within a 40 mile radius of Luminex's current principal office at 12212 Technology Blvd., Austin, Texas.


2.2.3 Actual Voluntary Termination. "Actual Voluntary Termination" shall mean termination by Executive of Executive's employment with Luminex for any reason other than Termination For Cause, Termination Other Than For Cause, Termination by Reason of Death or Termination by Reason of Incapacity. In the event of an Actual Voluntary Termination, Executive shall be paid within fifteen (15) business days following the effective date of termination the amount of the Accrued Obligations.


2.2.4 Termination by Reason of Incapacity. If, during the Term, Executive shall become Permanently Disabled (defined below), Luminex may terminate Executive's employment with Luminex effective on the earliest date permitted under applicable law, if any, and such termination shall be deemed "Termination by Reason of Incapacity". Upon termination of employment under this Section, Executive shall be paid (i) within three (3) business days following the effective date of termination the amount of the Accrued Obligations and (ii) all severance compensation provided in Section 4.2. As used herein, Executive shall be deemed "Permanently Disabled" if Executive is (i) collecting long-term disability payments under a long-term disability plan established for the benefit of Luminex's employees or executives generally or a reasonably similar plan or (ii) if, and only if, no such long-term disability plan is in effect at the time of determination, a physician selected by Luminex and reasonably acceptable to Executive makes a written determination that Executive is unable to perform his obligations under this Agreement despite his best efforts by reason of any medically determinable physical or mental impairment that can be expected to result in death or that has lasted or can be expected to last for a continuing period of not less than 12 months.


2.2.5 Termination by Reason of Death. In the event of Executive's death during the Term, Executive's employment with Luminex shall be deemed to have terminated as of the date on which his death occurs and the estate of Executive shall be paid (i) within fifteen (15) days following the effective date of termination the amount of the Accrued Obligations and (ii) all severance compensation provided in Section 4.3.


2.2.6 Termination Upon Expiration of Agreement. In the event that Luminex refuses for any reason to extend this Agreement by giving written notice at least 60 days prior to the initial or any renewal period as set forth in Section 2.1, Executive shall be paid (i) within three (3) business days following the effective date of termination the amount of the


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Accrued Obligations and (ii) all severance compensation provided in Section 4.4. In the event that Executive refuses for any reason (except as otherwise provided herein) to extend this Agreement by giving written notice at least 60 days prior to the initial or any renewal period as set forth in Section 2.1, the termination shall be deemed an Actual Voluntary Termination.


2.2.7 Termination of Relationship with Affiliated Entities. Unless agreed by Luminex (or a subsidiary thereof) and Executive in a separate written agreement (other than corporate minutes, resolutions, charter documents, bylaws and partnership agreements), upon the termination of Executive's employment with Luminex for any reason, Executive shall tender a written resignation of any positions he may have with Luminex and any and all of Luminex's direct and indirect subsidiaries.


2.2.8 Definition of Accrued Obligations. As used in this Agreement, "Accrued Obligations" means all accrued but unpaid salary, accrued but unpaid vacation, sick leave, and similar pay (all determined in accordance with Luminex's policies then in effect), and any appropriate business expenses incurred by Executive in connection with his duties hereunder, all to the date of termination.


3. SALARY, BENEFITS AND BONUS COMPENSATION.


3.1 Base Salary. As payment for the services to be rendered by Executive as provided in Section 1 and subject to the terms and conditions of Section 2, Luminex agrees to pay to Executive a "Base Salary" at the rate of $7,708.33 per each semi-monthly pay period or $185,000 per annum (or such greater amount as may be determined from time to time by the Board or the Compensation Committee thereof) payable in accordance with the then-current payroll policies of Luminex.


3.2 Annual Bonus. Executive shall be eligible to receive a bonus each year in an amount up to at least 40% of your then-current Base Salary (or such other amount as may otherwise be determined by the Company's Board of Directors), subject to the performance criteria established annually by the Company's Board of Directors and payable during the first quarter of the following year or otherwise as consistent with the timing of other employee bonuses. For calendar year 2005, Executive shall be eligible to receive a bonus of up to 60% of current Base Salary, subject to performance criteria set forth in the Management Performance Plan approved by the Company's Board of Directors, and provided that any such amount will be prorated based on time served during 2005. The Board is under no obligation to declare, and Luminex is under no obligation to pay, any bonus to Executive under the terms of this Agreement. In the event Executive and Luminex are parties to a written agreement or plan executed by both Luminex and Executive that governs bonus arrangements, and the provisions thereof conflict with this Section 3.2, the terms of such other written agreement or plan shall supersede this Section 3.2.


3.3 Signing Bonus. You will be granted a signing bonus of $14,578, payable in conjunction with Executive's first regular paycheck.


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3.4 Change in Control. In the event that both (i) a Change in Control (defined below) of Luminex occurs during the Term and (ii) Executive's employment with Luminex (or, as applicable, its successor in interest) terminates for any reason (including without limitation an Actual Voluntary Termination by Executive) at any time within six (6) months following the occurrence of the Change in Control of Luminex, in lieu of any Severance Compensation then owed or that otherwise would be owed in the future to Executive under Section 4 of this Agreement, Luminex (or its successor in interest) shall pay Executive both the Accrued Obligations and a lump sum payment (the "Change in Control Payment") in an aggregate amount equal to the sum of (i) the Bonus Amount (defined below), plus (ii) an amount equal to Executive's annual Base Salary (at the highest rate in effect during the period beginning six months immediately prior to the effective date of the Change of Control through the date of termination) within three (3) business days after the termination of Executive's employment. In the interest of clarity, Luminex and Executive agree that, upon the termination of Executive's employment at any time within six (6) months following the occurrence of the Change in Control of Luminex, the provisions of Sections 4.1, 4.2, 4.3, 4.4, and 4.6 shall automatically be deemed null and void and shall not apply with respect to any termination of Executive's employment (whether such termination is effected in connection with the Change in Control of Luminex or at any time in the future following the Change in Control of Luminex), and under no circumstances shall Luminex ever be obligated to pay Executive both a Change in Control Payment and Severance Compensation under Section 4. For purposes of this Agreement ...