1
Exhibit 10.80
AMENDMENT NO. 3 TO EMPLOYMENT AGREEMENT
THIS AMENDMENT NO. 3 to Employment Agreement is made and entered into
as of 23rd day of December, 1997 by and between AMERICAN HOMEPATIENT, INC., a
Delaware corporation (the "Company") and XXXXXX X. XXXXXXX, a resident of the
State of Tennessee (the "Executive").
WHEREAS, the Executive and the Company, as the successor of
Diversicare, Inc., are parties to that certain Employment Agreement dated
October 1, 1991 as amended on June 10, 1994 and December 1, 1995 (the Employment
Agreement as so amended is hereinafter referred to as the "Employment
Agreement"); and
WHEREAS, the parties desire to further amend the Employment Agreement
as set forth herein.
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements set forth herein and in the Employment Agreement, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound hereby, agree as
follows:
1. Section VIII(A) is hereby amended by deleting the current clause in
its entirety and substituting in it instead the following:
If the Executive's employment terminates due to either a
Without Cause Termination or a Constructive Discharge as
defined later in this Agreement, the Company will pay the
Executive in a lump sum upon such Termination or Constructive
Discharge an amount equal to the sum of (1) three hundred
percent (300%) of his Base Salary as in effect at the time of
such termination, plus (2) the annual incentive compensation
Executive received for performance during the Company's
immediately preceding fiscal year, multiplied by a fraction,
the numerator of which is the total number of full calendar
months during which the Executive was employed by the Company
during the Company's current fiscal year prior to termination
and the denominator of which is twelve (12); provided,
however, that if such termination occurs during the first six
(6) months of the Company's then current fiscal year, that
portion of the severance payment referenced in clause (2) will
be reduced by twenty percent (20%) to eighty percent (80%)
thereof. For example, if Executive's incentive compensation
for the prior fiscal year was Sixty Thousand and No/100
Dollars ($60,000.00) and his employment with the Company was
terminated as a result of a Without Cause Termination or a
Constructive Discharge five and one-half (5-1/2) months after
the beginning of the current fiscal year, that portion of the
severance
2
payment due to Executive pursuant to clause (2) above would be
Twenty Thousand and No/100 Dollars ($20,000.00), calculated as
follows: 80% x $60,000.00 x 5/12 = $20,000.00. Earned but
unpaid base salary and any accrued vacation will also be paid
in a lump sum at such time. All benefits and perquisites to
which Executive was entitled immediately prior to termination,
including without limitation, health insurance, participation
in the Company's Supplemental Executive Retirement Plan and
all other benefits and perquisites described in this
Agreement, will be continued for thirty-six (36) months. If
the Executive's employment terminates due to either a Without
Cause Termination or a Constructive Discharge, or pursuant to
Section XI, all stock options ("Options") granted to the
Executive under the Company's 1991 Nonqualified Stock Option
Plan, the Company's 1995 Nonqualified Stock Option Plan for
Directors or any other stock option program or plan (each and
collectively, the "Plan") shall be deemed vested, and the
Company shall cause the Options to remain exercisable for
thirty-six (36) months from the date of termination, subject
to the ten (10) year term limit set forth in the governing
Plan.
2. The first paragraph of Section XI shall be amended by deleting in
its entirety and substituting the following in it instead:
In the event there is a Change in Control of the ownership of
the Company, the Executive may at any time within 12 months of
the Change of Control resign upon written notice to the
Company. In this event, the Company shall pay to the Executive
in a lump sum upon such resignation an amount equal to the sum
of: (1) three hundred percent (300%) of his Base Salary as in
effect of the time of such resignation, plus (2) the annual
incentive compensation Executive received for performance
during the Company's immediately preceding fiscal year,
multiplied by a fraction, the numerator of which is the total
number of full calendar months during which the Executive was
employed by the Company during the Company's current fiscal
year prior to termination and the denominator of which is
twelve (12); provided, however, that if such termination
occurs within six (6) months following such Change of Control,
that portion of the severance payment referenced in clause (2)
will be reduced by twenty percent (20%) to eighty percent
(80%) thereof. For example, if Executive's incentive
compensation for the prior fiscal year was Sixty Thousand and
No/100 Dollars ($60,000.00) and his employment with the
Company was terminated as a result of a Change in Control five
and one-half (5-1/2) months after the beginning of the current
fiscal year, that portion of the
2
3
severance payment due to Executive pursuant to clause (2)
above would be Twenty Thousand and No/100 Dollars
($20,000.00), calculated as follows: 80% x $60,000.00 x 5/12 =
$20,000.00. In addition, earned but unpaid Base Salary and any
accrued vacation will be paid on a pro-rata basis for the year
in which resignation occurs. Any options granted to the
Executive prior to the Change of Control will be fully vested
upon a Change in Control regardless of whether Executive is
terminated or resigns. All benefits and perquisites to which
Executive was entitled immediately prior to resignation,
including without limitation, health insurance, participation
in the Company's Supplemental Retirement Plan and all other
benefits and perquisites described in this Agreement, will
also be continued for thirty-six (36) months from the
effective date of termination pursuant to a Change in Control.
3. Section XI shall be further amended by adding the following as a new
third paragraph:
Notwithstanding the above, no amount shall be payable
hereunder to the extent that it would result in the imposition
of an excise tax under Internal Revenue Code Section 4999, and
the severance amount payable above shall be automatically
reduced to the extent necessary to avoid such result.
4. The Company and Executive agree that, except as expressly set forth
herein, the terms and conditions of the Employment Agreement remain unchanged
and in full force and effect.
This Amendment shall be governed by and construed in accordance with
the substantive laws of the State of Tennessee.
3
4
IN WITNESS WHEREOF, the parties have executed this Amendment No. 3 to
Employment Agreement as of the date first above written.
AMERICAN HOMEPATIENT, INC.
By:
--------------------------------------------
Title:
-----------------------------------------
------------------------------------------------
XXXXXX X. XXXXXXX
4
