EMPLOYMENT AGREEMENT
AGREEMENT made by and between Ramsay Health Care, Inc., a Delaware
corporation (the "Company"), and Xxxxx Xxxxxx (the "Employee").
W I T N E S S E T H:
WHEREAS, the Company wishes to retain the services of the Employee, and the
Employee wishes to serve in the employ of the Company, upon the terms and
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
hereinafter set forth, the parties hereto hereby agree as follows:
1. Employment
1.1 The Company agrees to employ the Employee, and the Employee agrees to
serve in the employ of the Company, for the terms set forth in Section
1.2, in the position and with the responsibilities, obligations, duties,
and authority set forth in Sections 2 and 3 and on the other terms and
conditions set forth in this Agreement.
1.2 The term of the Employee's employment under this Agreement shall commence
on October 1, 1994 and continue until terminated in accordance with
Section 7 of this Agreement.
2. Position, Duties. The Employee shall serve in the position of Vice President,
Hospital Operations for the Company. The Employee shall perform faithfully
and diligently, such duties and obligations and shall have such other
responsibilities, appropriate to said position, as shall be assigned to him
from time-to-time by the Chief Executive Officer (the "CEO") or the Chief
Operating Officer and Executive Vice President (the "COO") of the Company or
their designee for such purposes. The Employee shall report directly to the
COO of the Company or his designee. The Employee shall devote his complete
and undivided attention to the performance of his duties, obligations, and
responsibilities hereunder during the normal working hours of executive
employees of the Company. The Employee hereby represents that he is not bound
by any confidentiality agreements or restrictive covenants which restrict or
may restrict his ability to perform his duties hereunder, and agrees that he
will not enter into any such agreements or covenants during the term of his
employment hereunder.
3. Compliance with Policies of the Company. The Employee acknowledges that he
has had an opportunity to ask any questions that he may have concerning the
employment policies of the Company and, as a condition of his employment,
agrees to comply with any and all such policies.
4. Salary and Bonus.
4.1 During the term of this Agreement, in consideration of the performance by
the Employee of the services set forth in Section 2 and his observance of
the other covenants set forth herein, the Company shall pay the Employee,
and the Employee shall accept, a base salary at the rate of $175,000 per
annum, payable in accordance with the standard payroll practices of the
Company.
4.2 The base salary set forth in Section 4.1 shall be reviewed annually by
the Board of Directors of the Company, or its designee for such purposes,
and adjusted by such amount as the Board, or its designee, shall
determine, in its or its designee's discretion, from time to time.
4.3 In addition to the base salary set forth above, the Company will grant to
Employee options to purchase 15,000 shares of the Company's common stock,
at a price to be determined at the next meeting of the Company's Board of
Directors, which is scheduled for September 10, 1994. These options will
be granted pursuant to a separate stock option agreement between the
Company and Employee and will not be exercisable until Employee's
interest in such options has vested, which vesting will occur at a rate
of 5,000 per year, with the first 5,000 shares vesting on the first
anniversary of the commencement of Employee's term of employment, with an
additional 5,000 shares vesting on the next two subsequent anniversary
dates.
4.4 In addition to the base salary set forth above, the Employee shall have
the opportunity to earn for each fiscal year of the Company during the
term of this Agreement, a bonus of two percent (2%) of the improvement in
normalized operations income of assigned operations. The bonus shall be
based upon the achievement by the Company and the Employee during such
fiscal year of the performance targets established in the discretion of
the Board of Directors of the Company, or its designee for such purposes,
for the purpose of determining such fiscal year's bonus. The bonus, if
any, payable to the Employee for a fiscal year of the Company shall be
payable within 90 days after the close of such fiscal year. The Board of
Directors may, at its discretion, amend or change the bonus calculation.
5. Expense Reimbursement. During the term of this Agreement, the Company shall
reimburse the Employee for all reasonable and necessary out-of-pocket
expenses incurred by him in connection with the performance of his duties
hereunder, including, without limitation, professional dues, travel and
related expenses for meetings which are beneficial and advantageous to the
current and future operations of the Company.
6. Benefits.
6.1 Benefit Plans. during the term of this Agreement, the Employee will be
eligible to participate in all pension, health, and welfare employee
benefit plans and programs of the Company, including, without limitation,
the group life insurance,
-2-
accidental death and dismemberment insurance ("AD&D insurance"),
disability, group hospitalization, surgical and major medical insurance
plans of the Company, in accordance with the provisions of such plans and
programs as in effect from time to time. The Employee shall have the
right to designate the beneficiary of all such life and AD&D insurance.
6.2 Vacation. The Employee shall be entitled to four (4) weeks vacation per
annum. Any unused vacation days shall carry over to succeeding years;
provided, however, that accumulated vacation may not exceed twenty (20)
days in the aggregate. The Company shall compensate the Employee for any
unused vacation days at the time of termination of the Employee's
employment hereunder by payment in a lump sum at the time of such
termination.
6.3 Sick Leave. The Employee shall be entitled to twelve (12) paid sick
day(s) per year. No unused sick days shall carry over to succeeding
years; and further provided that the Company shall not be required to
compensate the Employee for any unused sick days at the time of
termination of the Employee's employment hereunder.
6.4 Automobile. During the term of this Agreement, the Company shall provide
the Employee with a $400.00 per month allowance, or such other amount as
the Board of Directors of the Company, or its designee for such purposes,
may decide from time to time to use towards the costs of the operation
and maintenance of an automobile.
6.5 Relocation Expenses. The Company shall pay the reasonable and necessary
expenses incurred by the Employee in relocating his residence to New
Orleans, Louisiana, which the Company encourages Employee do to as soon
as possible after December 31, 1994, and which Employee must do prior to
June 30, 1995. In the future, in the event that the Board of Directors,
or its designee for such purposes, determines that relocation of the
residence of the Employee is necessary to the performance by the Employee
of his duties, obligations, and responsibilities as defined in Section 2,
the Company shall pay the reasonable and necessary expenses incurred by
the Employee in relocating his residence to such location determined by
the Board of Directors, or its designee for such purposes, subject to the
Company's relocation policy in effect at the time of the actual
relocation.
6.6 Temporary Lodging and Transportation. During the period of time prior to
Employee relocating his residence to New Orleans, Louisiana, the Company
shall provide employee with an apartment or other temporary lodging for
Employee's use during the time that Employee is required to be in New
Orleans. The Company will also pay for reasonable travel expenses of
Employee to and from his place of residence during such time period;
provided, however, that Employee shall coordinate such travel with the
travel that Employee is required to perform on behalf of the Company in
an effort to minimize expenses related to such transportation expense.
-3-
7. Termination of Employment.
7.1 Death. In the event of the death of the Employee during the term of this
Agreement, the Company shall pay to the estate or other legal
representative of the Employee (a) the base salary provided for in
Sections 4.1 and 4.2 (at the annual rate then in effect) accrued to the
date of death and not theretofore paid to the Employee; (b) any bonus due
to the Employee under Section 4.3 which was earned by the Employee at the
date of his death and not theretofore paid to the Employee; (c) any
amounts due and payable pursuant to Section 5; and (d) any amounts due
and payable pursuant to Sections 6.2 and 6.5. Rights and benefits of the
estate or other legal representative of the Employee under the pension,
health, and welfare benefit plans and programs of the Company shall be
determined in accordance with the provisions of such plans and programs
of the Company at the time of the effective date of the Employee's
termination pursuant to this Section 7.1. Neither the estate or other
legal representative of the Employee nor the Company shall have any
further rights or obligations under this Agreement.
7.2 Disability. If the Employee shall become incapacitated by reason of
sickness, accident, or other physical or mental disability and shall be
unable to perform the essential duties of his job and the Company is
unable reasonably to accommodate the Employee, the employment of the
Employee hereunder may be terminated by the Company or the Employee. In
the event of such termination, the Company shall pay to the Employee (a)
any bonus due to the Employee under Section 4.3 which was earned by the
Employee at the date of termination and not theretofore paid to the
Employee; (b) any amounts due and payable pursuant to Section 5; (c) any
amounts due and payable pursuant to Sections 6.2 and 6.5.; and (d)
continue to pay to the Employee the base salary provided for in Sections
4.1 and 4.2 (at the annual rate then in effect) until the first to occur
of (i) the expiration of a period of six (6) months from the date of such
termination, (ii) the commencement of payment of benefits the Employee
under any disability plan or policy maintained by the Company or (iii)
the death of the Employee. Rights and benefits of the Employee under the
pension, health, and welfare benefit plans and programs of the Company
shall be determined in accordance with the provisions of such plans and
programs of the Company at the time of the effective date of the
Employee's termination pursuant to this Section 7.2. Neither the Employee
nor the Company shall have any further rights or obligations under this
Agreement, except as provided in Sections 8, 9, and 10.
7.3 Good Cause. The employment of the Employee hereunder may be terminated by
the Company at any time for Good Cause (as hereinafter defined). In the
event of such termination, the Company shall pay to the Employee (a) the
base salary provided for in Sections 4.1 and 4.2 (at the annual rate then
in effect) accrued to the date of such termination and not theretofore
paid to the Employee; (b) any bonus due to the Employee under Section 4.3
which was earned by the Employee at the date of such termination and not
theretofore paid to the Employee; (c) any amounts due and payable
pursuant to Section 5; and (d) any amounts due and
-4-
payable pursuant to Sections 6.2 and 6.5. Rights and benefits of the
Employee under the pension, health, and welfare benefit plans and
programs of the Company shall be determined in accordance with the
provisions of such plans and programs of the Company at the time of the
effective date of the Employee's termination pursuant to this Section
7.3. For purposes hereof, "Good Cause" shall include (a) the Employee's
failure to discharge his duties and responsibilities under this
Agreement, with such failure to discharge such duties and
responsibilities to be determined by a majority of the Board of Directors
of the Company, or its designee for such purposes, either of whose good
faith determination with respect thereto shall be conclusive, or (b) the
Employee's commission of (i) a felony or (ii) any crime or offense
involving moral turpitude. After the satisfaction of any claim of the
Company against the Employee incidental to such Good Cause, neither the
Employee nor the Company shall have any further rights or obligations
under this Agreement, except as provided in Sections 8, 9, and 10.
7.4 Other Termination by the Company. The Board of Directors of the Company,
or its designee for such purposes, may terminate the Employee's
employment at any time for whatever reason it, or its designee, deems
appropriate. In the event that such termination is not pursuant to
Sections 7.1, 7.2, or 7.3, the Company shall pay to the Employee (a) the
base salary provided for in Sections 4.1 and 4.2 (at the annual rate then
in effect) accrued to the date of termination and not theretofore paid to
the Employee; (b) any bonus due to the Employee under Section 4.3 which
was earned by the Employee at the date of such termination and not
theretofor paid to the Employee; (c) any amounts due and payable
pursuant to Section 5; (d) any amounts due and payable pursuant to
Section 6.2 and 6.5; and (e) continue to pay to the Employee the base
salary provided for in Sections 4.1 and 4.2 (at the annual rate then in
effect) until the first to occur of (i) the expiration of a period of six
(6) months following such termination or (ii) the death of the Employee.
Rights and benefits of the Employee, or in the event of death of the
Employee the estate or other legal representative of Employee, under the
benefit plans and programs of the Company shall be determined in
accordance with the provisions of such plans and programs. The Employee,
the Employee's estate or other legal representative, and the Company
shall not have any further rights or obligations under this Agreement,
except as provided in Sections 8, 9, and 10.
7.5 Termination by the Employee. The Employee may terminate his employment
with the Company upon thirty (30) days prior written notice to the
Company. In the event of such termination, the Company shall pay to the
Employee (a) the base salary provided for in Sections 4.1 and 4.2 (at the
annual rate then in effect) accrued to the date of termination and not
theretofore paid to the Employee; (b) any bonus due to the Employee under
Section 4.3 which was earned by the Employee at the date of termination
and not theretofore paid to the Employee; (c) any amounts due and payable
pursuant to Section 5; and (d) any amounts due and payable pursuant to
Sections 6.2 and 6.5. Rights and benefits of the Employee under the
benefit plans and programs of the Company shall be
-5-
determined in accordance with the provisions of such plans and programs.
Neither the Employee nor the Company shall have any further rights or
obligations under this Agreement, except as provided in Sections 8, 9,
and 10.
7.6 Cobra Continuation Period. In the event that the Employee is terminated
pursuant to 7.1, 7.2, 7.3, or 7.4 and coverage for the Employee under the
Company's employee health plan is paid for by the Company for any
specified period of time, then such specified period of paid coverage
shall run, to the extent permitted by law, concurrently with the COBRA
continuation period to which the Employee is entitled pursuant to
Internal Revenue Code /S/ 4980B.
8. Confidential Information.
8.1 The Employee shall, during the Employee's employment with the Company and
thereafter, treat all confidential material confidentially and, except in
accordance with the terms of this Agreement, shall not, without the prior
written consent of a majority of the Board of Directors of the Company,
disclose such material, directly or indirectly, to any party not at the
time of such disclosure an employee or agent of the Company, or remove
from the Company's premises any notes or records relating thereto, copies
or facsimiles thereof (whether made by electronic, electrical, magnetic,
optical, laser, acoustic or other means), or any other property of the
Company. The Employee agrees that all confidential material, together
with all notes and records of the Employee relating thereto, and all
copies or facsimiles thereof in the possession of the Employee (whether
made by the foregoing or other means) are the exclusive property of the
Company. The Employee shall not in any manner use any confidential
material, or any other property of the Company, in any manner not
specifically directed by the Company or in any way which is detrimental
to the Company, as determined by a majority of the Board of Directors of
the Company in its sole discretion.
8.2 For the purposes hereof, the term "confidential material" shall mean all
information in any way concerning the activities, business or affairs of
the Company, or the Company's customers and clients, and all information
concerning the practices, customers and clients of the Company, and all
information in any way concerning the activities, business or affairs of
any of such customers or clients, as such, which is furnished to the
Employee by the Company or any of its agents, customers or clients, as
such, or otherwise acquired by the Employee in the course of the
Employee's employment with the Company; provided, however, that the term
"confidential material" shall not include information which (i) becomes
generally available to the public other than as a result of a disclosure
by the Employee, (ii) was available to the Employee on a non-confidential
basis prior to his employment with the Company or (iii) becomes
available to the Employee on a non-confidential basis from a source other
than the Company or any of its agents, customers, or clients, as such,
provided that such source is not bound by a confidentiality agreement
with the Company or any of such agents, customers, or clients.
-6-
8.3 Promptly upon the request of the Company, the Employee shall deliver to
the Company all confidential material in the possession of the Employee
without retaining a copy thereof, unless, in the opinion of counsel for
the Company, either returning such confidential material or failing to
retain a copy thereof would violate any applicable federal, state, local,
or foreign law, in which event such confidential material shall be
returned without retaining any copies thereof as soon as practicable
after such counsel advises that the same may be lawfully done.
8.4 In the event that the Employee is required, by oral questions,
interrogatories, requests for information or documents, subpoena, civil
investigative demand or similar process, to disclose any confidential
material, the Employee shall provide the Company with prompt notice
thereof so that the Company may seek an appropriate protective order
and/or waive compliance by the Employee with the provisions hereof;
provided, however, that if in the absence of a protective order or the
receipt of such a waiver, the Employee is, in the opinion of counsel for
the Company, compelled to disclose confidential material not otherwise
disclosable hereunder to any legislative, judicial, or regulatory body,
agency or authority, or else be exposed to liability for contempt, fine
or penalty, or to other censure, such confidential material may be
disclosed.
9. Interference With the Company.
9.1 The Employee acknowledges that the services to be rendered by him to the
Company are of a special and unique character. The Employee agrees that,
in consideration of his employment hereunder, the Employee will not (a)
for a period of twelve (12) months commencing on the date of termination
of his employment with the Company, (i) solicit or endeavor to solicit
patient referrals, either on his own account or for any person, firm,
corporation or other organization, from (x) any person, including any
physician, clinical psychologist, social worker, or consultant to the
Company, who, during the period of the Employee's employment with the
Company, made patient referrals to the Company, or (y) any employee of
the Company (provided, however, that the Employee shall not be deemed to
have breached this covenant if the contact with any person referred to in
clause (x) is initiated by such person), or (ii) solicit or entice or
endeavor to solicit or entice away from the Company any person who was a
director, officer, employee, or consultant of the Company, either on his
own account or for any person, firm, corporation, or other organization,
whether or not such person would commit any breach of his contract of
employment by reason of leaving the service of the Company, and the
Employee agrees not to employ, directly or indirectly, any person who was
a director, officer or employee of the Company or who by reason of such
position at any time is or may be likely to be in possession of any
confidential information or trade secrets relating to the businesses or
products of the Company or (b) for a period or twelve (12) months
commencing on the date of termination of his employment with the Company,
take any action or make any statement the effect of which would be,
directly or indirectly, to impair the good will of the Company or the
-7-
business reputation or good name of the Company or be otherwise
detrimental to the interests of the Company, including any action or
statement intended, directly or indirectly, to benefit a competitor of
the Company.
9.2 The Employee and the Company agree that if, in any proceeding, the
court or other authority shall refuse to enforce the covenants herein
set forth because such covenants cover too extensive a geographic area
or too long a period of time, any such covenant shall be deemed
appropriately amended and modified in keeping with the intention of the
parties to the maximum extent permitted by law.
10. Equitable Relief. In the Event of a breach or threatened breach by the
Employee of any of the provisions of Sections 8 or 9 of this Agreement, the
Employee hereby consents and agrees that the Company shall be entitled to an
injunction or similar equitable relief from any court of competent
jurisdiction restraining the Employee from committing or continuing any such
breach or threatened breach or granting specific performance of any act
required to be performed by the Employee under any of such provisions,
without the necessity of showing any actual damage or that money damages
would not afford an adequate remedy and without the necessity of posting any
bond or other security. Nothing herein shall be construed as prohibiting the
Company from pursuing any other remedies at law or in equity which it may
have. For purposes of Sections 8, 9, and 10 of this Agreement, the term
"Company" shall be deemed to include the subsidiaries and affiliates of the
Company.
11. Successors and Assigns.
11.1 Assignment by the Company. The Company shall require any successors
(whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of
the Company to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to
perform if no such succession had taken place. As used in this Section,
the term "Company" shall mean the Company as hereinbefore defined and
any successor to its business and/or assets as aforesaid which
otherwise becomes bound by all the terms and provisions of this
Agreement by operation of law and this Agreement shall be binding upon,
and inure to the benefit of, the Company, as so defined.
11.2 Assignment by the Employee. The Employee may not assign this Agreement,
or any part thereof, without the prior written consent of a majority of
the Board of Directors of the Company; provided, however, that nothing
herein shall preclude one or more beneficiaries of the Employee from
receiving any amount that may be payable following the occurrence of
his legal incompetency or his death and shall not preclude the legal
representative of his estate from receiving such amount or from
assigning any right hereunder to the person or persons entitled thereto
under his will, or in the case of intestacy, to the person or persons
entitled thereto under the laws of intestacy applicable to his estate.
The term "beneficiaries," as used in this Agreement, shall mean a
beneficiary or beneficiaries so designated to receive any such amount
or, if no beneficiary has
-8-
been so designated, the legal representative of the Employee (in the
event of his incompetency) or the Employee's estate.
12. Governing Law. This Agreement shall be deemed a contract made under, and for
all purposes shall be construed in accordance with, the laws of the State of
Delaware applicable to contracts to be performed entirely within such State.
In the event that a court of any jurisdiction shall hold any of the
provisions of this Agreement to be wholly or partially unenforceable for any
reason, such determination shall not bar or in any way affect the Company's
right to relief as provided for herein in the courts of any other
jurisdiction. Such provisions, as they relate to each jurisdiction, are, for
this purpose, severable into diverse and independent covenants. Service of
process on the parties hereto at the addresses set forth herein shall be
deemed adequate service of such process.
13. Entire Agreement. This Agreement contains all the understandings and
representations between the parties hereto pertaining to the subject matter
hereof and supersedes all undertakings and agreements, whether oral or in
writing, if any there be, previously entered into by them with respect
thereto; provided, however, that Section 8 hereof shall not serve as a
limitation of the terms of any other non-compete agreement between the
parties hereto.
14. Amendment, Modification, Waiver. No provision of this Agreement may be
amended or modified unless such amendment or modification is agreed to in
writing and signed by the Employee and by a duly authorized representative
of the Company other than the Employee. Except as otherwise specifically
provided in this Agreement, no waiver by either party hereto of any breach
by the other party hereto of any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of a similar or
dissimilar provision or condition at the same or any prior or subsequent
time, nor shall the failure of or delay by either party hereto in exercising
any right, power or privilege hereunder operate as a waiver thereof to
preclude any other or further exercise thereof or the exercise of any other
such right, power, or privilege.
15. Arbitration. Any controversy or claim arising out of or relating to this
Agreement, or any breach thereof, shall, except as provided in Section 9, be
settled by arbitration in accordance with the rules of the American
Arbitration Association then in effect and judgment upon such award rendered
by the arbitrator may be entered in any court having jurisdiction thereof.
The arbitration shall be held in the area where the Company then has its
principal place of business. The arbitration award shall include attorneys'
fees and costs to the prevailing party.
16. Notices. Any notice to be given hereunder shall be in writing and delivered
personally or sent by certified mail, postage prepaid, return receipt
requested, addressed to the party concerned at the address indicated below
or at such other address as such party may subsequently designate by like
notice:
-9-
If to the Company:
Ramsay Health Care, Inc.
One Poydras Plaza
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxx 00000
If to the Employee:
Xxxxx Xxxxxx
0000 Xxxxxxxx Xx.
Xxxxx, XX 00000
17. Severability. Should any provision of this Agreement be held by a court or
arbitration panel of competent jurisdiction to be enforceable only if
modified, such holding shall not affect the validity of the remainder of
this Agreement, the balance of which shall continue to be binding upon the
parties hereto with any such modification to become a part hereof and
treated as though originally set forth in this Agreement. The parties
further agree that any such court or arbitration panel is expressly
authorized to modify any such unenforceable provision of this Agreement in
lieu of severing such unenforceable provision from this Agreement in its
entirety, whether by rewriting the offending provision, deleting any or all
of the offending provision, adding additional language to this Agreement, or
by making such other modifications as it deems warranted to carry out the
intent and agreement of the parties as embodied herein to the maximum extent
permitted by law. The parties expressly agree that this Agreement as so
modified by the court or arbitration panel shall be binding upon and
enforceable against each of them. In any event, should one or more of the
provisions of this Agreement be held to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality, or
unenforceability shall not affect any other provisions hereof, and if such
provision or provisions are not modified as provided above, this Agreement
shall be construed as if such invalid, illegal or unenforceable provisions
had never been set forth herein.
18. Withholding. Anything to the contrary notwithstanding, all payments required
to be made by the Company hereunder to the Employee or his beneficiaries,
including his estate, shall be subject to withholding of such amounts
relating to taxes as the Company may reasonably determine it should withhold
pursuant to any applicable law or regulation. In lieu of withholding such
amounts, in whole or in part, the Company may, in its sole discretion,
accept other provision for payment of taxes as permitted by law, provided it
is satisfied in its sole discretion that all requirements of law affecting
its responsibilities to withhold such taxes have been satisfied.
19. Survivorship. The respective rights and obligations of the parties hereunder
shall survive any termination of this Agreement to the extent necessary to
the intended preservation of such rights and obligations.
-10-
20. Titles. Titles of the sections of this Agreement are intended solely for
convenience and no provision of this Agreement is to be construed by
reference to the title of any section.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
RAMSAY HEALTH CARE, INC.
BY:
(Signature of Xxxxxxx
X. Xxxxxxxx appears here) 7/15/94
------------------------------ ------------
Xxxxxxx X. Xxxxxxxx DATE
Chief Operating Officer and
Executive Vice President
EMPLOYEE
(Signature of Xxxxx Xxxxxx
appears here) 7/19/94
------------------------------ ------------
Xxxxx Xxxxxx DATE
-11-
