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Exhbit 10.30
SECOND AMENDMENT TO SENIOR MANAGEMENT AGREEMENT
This Second Amendment to Senior Management Agreement is made as of
October 15, 1997, between Principal Hospital Company, an Oregon corporation
(formerly known as Brim, Inc.) (the "Company"), Xxxxxxx X. Xxxx ("Executive"),
and Golder, Thoma, Xxxxxxx, Xxxxxx Fund IV, L.P., a Delaware limited partnership
("GTCR").
The Company, Executive, GTCR, PHC of Delaware, Inc., a Delaware
corporation (formerly known as Principal Hospital Company), and Leeway and Co.
are parties to a Senior Management Agreement, dated as of December 17, 1996,
amended as of July 14, 1997 (as so amended, the "Senior Management Agreement").
Section 11(i) of the Senior Management Agreement provides that the
agreement may be amended with the prior written consent of the Company,
Executive and GTCR.
The parties hereto agree as follows:
1. Section 1(b) of the Senior Management Agreement is hereby deleted in
its entirety.
2. Section 2(a) of the Senior Management Agreement is hereby amended by
deleting Section 2(a) in its entirety and replacing it with the following:
(a)(i) Executive received 111,266 shares of Common Stock
pursuant to the Merger, and, after giving effect to the
purchase of shares of Common Stock pursuant to paragraph 1(a)
of this Agreement, owns an aggregate of 197,938 shares of
Common Stock, of which 110,404 shares shall be "Vesting
Shares" pursuant to this Agreement. In addition, a number of
shares (rounded to the nearest whole number) equal to 60.7261%
of any shares of Common Stock purchased pursuant to Section
6(d) of the Stockholders Agreement shall be "Vesting Shares"
pursuant to this Agreement.
(ii) All Vesting Shares will become vested on the date of
Executive's death or disability (as determined by the Board in
its good faith judgment) if Executive is employed by the
Company or any of its Subsidiaries at such date.
(iii) In the event of a Public Offering: (w) the provisions of
paragraph 2(a)(iv) shall no longer be applicable; (x) 24,840
Vesting Shares shall become vested as of the date of the
consummation of the initial Public Offering; (y) 26,068 Shares
shall become vested on each of the first two anniversaries of
the consummation of such Public
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Offering; and (z) 26,067 Shares shall become vested on the
third anniversary of the consummation of such Public Offering,
in each case if as of each such date Executive is still
employed by the Company or any of its Subsidiaries.
(iv) Except as otherwise provided in this paragraph 2(a) or in
paragraph 2(b), the Vesting Shares will become vested in
accordance with the following schedule, if as of each such
date Executive is still employed by the Company or any of its
Subsidiaries:
Cumulative
Percentage of
Vesting Shares
Date Vested
---- --------------
July 26, 1997 20%
July 26, 1998 40%
July 26, 1999 60%
July 26, 2000 80%
July 26, 2001 100%
(v) All other shares of Executive Stock vest immediately upon
receipt of such shares pursuant to the Merger or the
Investment Agreement Counterpart, or upon purchase by
Executive.
3. Section 2(b) of the Senior Management Agreement is hereby amended by
deleting the first sentence of Section 2(b) in its entirety and replacing it
with the following:
If Executive ceases to be employed by the Company and its
Subsidiaries on any date other than (i) an anniversary of the
Public Offering prior to the third anniversary of the Public
Offering or (ii) any July 26 prior to July 26, 2001 (each, a
"Vesting Date"), the cumulative percentage of Vesting Shares
to become vested will be determined on a pro rata basis
according to the number of days elapsed since the prior
Vesting Date.
4. Section 6(b) of the Senior Management Agreement is hereby amended by
deleting Section 6(b) in its entirety and replacing it with the following:
(b) Termination. The Employment Period will continue until
Executive's resignation, disability (as determined by the
Board in its good faith judgment) or death or until the Board
determines in its good faith judgment that termination of
Executive's employment is in the best interests of the
Company. If Executive's employment is
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terminated by the Company with or without cause or as a result
of Executive's disability (as determined by the Board in its
good faith judgment) or death, the Company shall pay to
Executive (or his estate), in twenty-four equal monthly
installments, an amount equal to twice Executive's Annual Base
Salary; provided, that the severance payments set forth in
this paragraph 6(b) shall cease and the Company shall have no
further obligation hereunder upon Executive's acceptance of
employment with any entity whose business is within the
Company's core business of owning and operating rural
hospitals.
5. Section 8(a) of the Senior Management Agreement is hereby amended by
deleting Section 8(a) in its entirety and replacing it with the following:
(a) Noncompetition. Executive acknowledges that in the course
of his employment with the Company he will become familiar
with the Company's trade secrets and with other confidential
information concerning the Company and that his services will
be of special, unique and extraordinary value to the Company.
Therefore, Executive agrees that, until the earlier of (i) the
first anniversary of the end of the Employment Period and (ii)
the consummation of a Sale of the Company (the "Noncompete
Period"), he shall not directly or indirectly own, manage,
control, participate in, consult with, render services for,
(i) any business, the operating facilities of which compete
with the operating facilities of the Company or its
Subsidiaries within the geographical area included in the
50-mile radius around each location where the Company or any
Subsidiary owns, leases, manages or otherwise maintains an
operating facility, engages in business or, on the date of
Executive's termination, plans to own, lease, manage or
otherwise maintain a facility or engage in business, or (ii)
any business in which the Company or any of its Subsidiaries
has entered into a letter of intent or is or has been within
one year prior to the date of termination of Executive's
employment in active negotiations relating to the acquisition
of such business by the Company or its Subsidiaries.
6. Section 9 of the Senior Management Agreement is hereby amended by
deleting the definition of "Sale of the Company" and replacing it with the
following:
"Sale of the Company" means any transaction or series of
transactions pursuant to or as a result of which (a) the
Investor owns less than 25% of the Common Stock or (b) any
person(s) or entity(ies) (including any Affiliates of the
Investor) other than the Investor in the aggregate acquire(s)
(i) 20% or more of the Common Stock or (ii) all or
substantially all of the Company's assets determined on a
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consolidated basis; provided that the term "Sale of the
Company" shall not include an initial Public Offering.
7. All other provisions of the Senior Management Agreement shall remain
in full force and effect.
8. All share numbers in this Second Amendment to Senior Management
Agreement are on the same basis as the numbers in the Senior Management
Agreement, and therefore do not give effect to the 3-for-1 stock split of the
Company's Common Stock effected in May 1997 or the merger of the Company into
Province Healthcare Company in October 1997.
9. This Second Amendment to Senior Management Agreement may be executed
simultaneously in two or more counterparts, any of which need not contain the
signatures of more than one party, but all such counterparts taken together
shall constitute one and the same agreement.
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SRMGMTA2.RDG
IN WITNESS WHEREOF, the parties hereto have executed this Second
Amendment to Senior Management Agreement on the date first written above.
PRINCIPAL HOSPITAL COMPANY
By: /s/ Xxxxxx X. Xxxx
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Its: Chief Executive Officer
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GOLDER, THOMA, XXXXXXX, XXXXXX
FUND IV, L.P.
By: GTCR IV, L.P.,
its General Partner
By: Golder, Thoma, Cressey, Rauner, Inc.,
its General Partner
By: /s/ Xxxxxx X. Xxxxx
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Its: Principal
/s/ Xxxxxxx X. Xxxx
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XXXXXXX X. XXXX
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