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EXHIBIT 10.1(a)
FIRST AMENDMENT TO THE
EMPLOYMENT AGREEMENT
BETWEEN BLUE CROSS AND BLUE SHIELD OF GEORGIA, INC.,
CERULEAN COMPANIES, INC. AND XXXXXXX X. XXXXX
This First Amendment is made to that certain Employment Agreement
entered into between Blue Cross and Blue Shield of Georgia, Inc., the Cerulean
Companies, Inc. (collectively, the "Employer") and Xxxxxxx X. Xxxxx (the
"Employee"), dated January 1, 1997 (the "Employment Agreement").
W I T N E S S E T H:
WHEREAS, the Employer and the Executive desire to amend the Employment
Agreement to make certain technical corrections to more closely approximate the
intent of the parties at the time of execution; and
WHEREAS, Section 19 of the Employment Agreement provides that the
Employer and the Executive may amend the Employment Agreement at any time by a
written instrument signed by both parties; and
WHEREAS, the Board of Directors of the Employer has adopted a
resolution authorizing this amendment of the Employment Agreement;
NOW, THEREFORE, the Employment Agreement hereby is amended as follows:
1.
Section 10(b) of the Employment Agreement is amended by deleting that
section in its entirety and by substituting the following in lieu thereof:
"(b) Employer shall provide Employee with a nonqualified
supplemental executive retirement pension (SERP) pursuant to the terms
of that certain Agreement for Supplemental Executive Retirement
Benefits, dated December 1, 1996, between Blue Cross and Blue Shield of
Georgia, Inc. and Xxxxxxx X. Xxxxx, a copy of which is attached hereto,
as the same may be amended by the parties from time to time."
2.
A new Section 10(e) is hereby added to the Employment Agreement, to
read as follows:
"(e) Excise Tax Benefits Following a Change in Control.
(1) Gross-Up Payment. If all or a portion of any payments under
this Agreement, or under any other agreement with or plan of Employer
qualifies as "excess parachute payments" under Section 280G of the
Internal Revenue Code of l986, as amended (the "Code"), and are thereby
subject to the excise tax described in Code Section 4999, Employer
shall provide Employee an additional "Gross-Up Payment." This Gross-Up
Payment shall be a cash payment that is equal to Employee's excise tax
liability under
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Code Section 4999, plus an additional amount to cover Employee's state
and federal income taxes on the additional payment.
If any such excess parachute payments become payable to
Employee following Employer's termination of Employee for any reason
other than For Cause, or following Employee's voluntary termination for
Good Reason, the Gross-Up Payment described in this Paragraph 10(e)(1)
shall be paid as soon as practicable following such termination from
employment, and in no event later than thirty (30) days following such
termination. If any such excess parachute payments become payable to
Employee while Employee continues in active employment with Employer,
such payment shall be made as soon as practicable following the Change
in Control, but not later than thirty (30) days following such Change
in Control.
The independent accounting firm used by Employer at the time
of a Change in Control (the "Accounting Firm") shall determine whether
Executive is entitled to a Gross-Up Payment under this Paragraph
10(e)(1), and the amount of any such payment. The Accounting Firm shall
provide detailed supporting calculations to Employer and Employee
within fifteen (15) business days of receiving notice from Employer or
Employee that there has been a Change in Control. If the Accounting
Firm is serving as accountant or auditor for the individual, entity, or
group effecting the Change in Control, Employee may appoint another
nationally recognized accounting firm to make the determinations
required under this Paragraph. Employer shall pay all fees and expenses
of the Accounting Firm.
(2) Subsequent Recalculation. If the Internal Revenue Service
subsequently adjusts the excise tax computation described above,
Employer shall reimburse Employee for the full amount necessary to make
Employee whole on an after-tax basis, including the value of any
underpaid excise tax, and any related interest and/or penalties due to
the Internal Revenue Service."
3.
The amendments made to the Employment Agreement by this First Amendment
shall be effective as of January 1, 1998.
4.
Except as specifically set forth herein, the terms of the Employment
Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the Employer and the Executive have executed this
First Amendment to the Employment Agreement on the 7th day of March, 1998.
EMPLOYER:
BLUE CROSS AND BLUE SHIELD OF GEORGIA, INC.
By: /s/ Xxxxx X. XxXxxx, Xx.
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Title: Chairman
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Attest:
/s/ Xxxxxxxx X. Xxxxxxx
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[CORPORATE SEAL]
CERULEAN COMPANIES, INC.
By: /s/ Xxxxx X. XxXxxx, Xx.
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Title: Chairman
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Attest:
/s/ Xxxx X. Xxxxxxx
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[CORPORATE SEAL]
EXECUTIVE:
/s/ Xxxxxxx X. Xxxxx
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XXXXXXX X. XXXXX
