EXHIBIT 10.7
EMPLOYMENT AGREEMENT PAGE 1
MEDFORD CLINIC & XXX X. XXXX
EMPLOYMENT AGREEMENT
This agreement, made and entered into as of the 22 day of June, 1995 between
Medford Clinic, P.C., hereinafter referred to as "employer", and Xxx X.Xxxx,
hereinafter referred to as "Employee",
WITNESS:
WHEREAS, Employer is a Oregon professional corporation rendering medical
services in the State of Oregon; and
WHEREAS, Employer desires to employ
Employee as its Executive Director upon the terms and conditions hereinafter
set forth, and Employee desires to accept such employment,
NOW, THEREFORE, Employer and Employee agree as follows:
1. EMPLOYMENT AND DUTY: Employer hereby employs Employee and Employee
hereby accepts employment as Executive Director of Medford Clinic, P.C..
Employee agrees to devote his full time and attention to his duties as Executive
Director for Employer. Any outside consulting or other employment utilizing the
professional skills of Employee must be pre-approved by the Board of
Directors and in no case will be done on Employer's time or utilizing Employer's
other employees or resources. Employee's duties shall include, but not be
limited to, the planning, coordinating, and administering of policies,
procedures, growth and development relating to all aspects of finance, business,
labor and medical clinic operations for Medford Clinic, P.C., in consultation
with and under the direction of Employer's Board of Directors. Attachment "A"
represents a more detailed job description of Employer's duties.
2. COMPENSATION: Employer shall pay Employee a salary of $140,000 per
annum payable on a biweekly basis. Periodic evaluation, no less than annually,
by the Board of Directors will determine subsequent compensation adjustments
and incentive criteria.
EMPLOYMENT AGREEMENT PAGE 2
MEDFORD CLINIC & XXX X. XXXX
3. EXPENSES: Employer shall pay Employee's job related expenses as
reported to and approved by the Board of Directors. In addition to such
expenses, Employer shall reimburse Employee reasonable expenses for attending
two (2) professional and educational meetings per annum for the purpose of
maintaining or improving Employee's skills as an Executive Director. Employee is
responsible for reporting such expenses to the Board during annual evaluation.
Employer shall pay Employee's dues and expenses of membership in civic groups as
approved by the Board.
4. OTHER BENEFITS: During the term of this Agreement, in addition to
Employee's monthly compensation, Employer shall provide Employee with the
following:
A. Employer shall provide health insurance to employee and his immediate
family of the same type and on the same terms as employer's physician
employees.
B. Employer shall provide Employee with long-term disability insurance of
the same type and on the same terms as employer's physician employees.
C. At such time as Employee becomes eligible to participate in any
pension or profit sharing plans that Employer maintains for its other
employees, Employer shall contribute to such plans for Employee such
amounts as are required for eligible employees under said plans.
D. Employer shall provide Employee with $100,000 term life insurance
policy.
E. Employee is eligible for all other benefits on the same terms as other
employees of Medford Clinic. Extended sick time will accrue to a maximum of
170 hours.
5. INCENTIVE COMPENSATION: In addition to salary, Employer will pay
Employee an equal amount that annualized average FTE shareholder income exceeds
$140,000 in the first 12 months of employee's employment. Incentive compensation
is void in case of death or disability and employee will forfeit if the non
competition agreement (section 10) is violated.
6. PAID TIME OFF (PTO): In lieu of sick leave, holidays, and vacation,
employee will accrue 1.154 days of PTO per pay period to a maximum of 30 days
per year. Paid time off will accumulate from year to year to a maximum of 480
hours.
EMPLOYMENT AGREEMENT PAGE 3
MEDFORD CLINIC & XXX X. XXXX
If Employee is eligible for severance pay (per section 7), the amount of PTO due
employee will reduce the severance pay by the amount of PTO paid.
7. TERM OF EMPLOYMENT: Employee's term of employment hereunder shall
commence on August 14, 1995 and shall continue thereafter until terminated as
provided herein. Either party may terminate this Agreement for any reason and
without cause upon sixty (60) days written notice to the other party. Upon
termination of Employee's employment, Employee shall be entitled to receive any
compensation accrued, including compensation for accrued but unused PTO, as of
the date of termination. Additionally, if Employee involuntarily terminates
without cause during the first eighteen (18) months of this agreement, Employee
shall be entitled to twelve (12) months severance pay (minus PTO due Employee
per section 6). If Employee involuntarily terminates without cause after
eighteen (18) months of employment, Employee shall be entitled to six (6) months
severance pay (minus PTO due Employee per section 6). If Employee is terminated
for willful misconduct, as determined by Employer, Employee is not eligible for
severance pay. If Employer's obligation to Employee for the term of severance
pay above are not already satisfied, the obligation will cease on the first date
of Employee's full time employment by another employer.
8. MOVING EXPENSES: Employer shall pay reasonable costs, not to exceed
$10,000, for shipping Employee's typical household belongings to Medford from
his present place of residence. Employer reserves the right to make such
shipping arrangements.
9. MEDICAL EXAMINATION: Medford Clinic policy requires a periodic health
examination of Executive Director and physician employees. The examination may
be provided by the personal physician of employee's choice.
10. NON-COMPETITION AGREEMENT: As inducement for Employer to hire
Employee, Employee agrees that upon termination of this agreement for any
reason, Employee shall not take a job in medical management for another
employer, nor act in any capacity in health care consulting, in Xxxxxxx or
Xxxxxxxxx County, Oregon for a period of eighteen (18) months without consent of
Employer. Employee must give ten (10) days notice to Employer before accepting
new employment so that Employer may determine whether such new employment
violates the terms of this agreement.
EMPLOYMENT AGREEMENT PAGE 4
MEDFORD CLINIC & XXX X. XXXX
11. CONFIDENTIALITY: Employee has fiduciary responsibility to Employer
and will not use or reveal fiduciary information that could harm Employer.
Employee understands and agrees that all of Employer's records are strictly
confidential and Employee shall maintain the confidentiality of all such records
during the term of this Agreement and thereafter. All memos, documents, business
plans and other papers created by Employee during the term of his employment
are the property of Employer and will be turned over to Employer at the
termination of employment.
12. NOTICES: All notices required or permitted to be given under this
Agreement shall be given by certified mail, return receipt requested, to the
parties at the following addresses or to such other addresses as either may
designate in writing to the other party:
Employer: Medford Clinic, P.C.
000 Xxxxx Xxx Xx.
Xxxxxxx, XX 00000
Employee: Xxx X. Xxxx
0000 Xxxxxx Xxx.
Xxxxxxxx, XX 00000
13. WAIVER OF BREACH: The waiver by either party of the breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach by either party. No waiver or modification of this agreement
shall be valid unless in writing and signed by both parties.
14. SUCCESSION: This Agreement shall inure to the benefit of, and be
binding upon the parties, their successor, heirs, personal representatives and
assigns.
15. ARBITRATION: Any disputes arising out of interpretation or
application of this Agreement or any employment relationships shall be settled
by one arbitrator under the Commercial Arbitration Rules of the American
Arbitration Association. The cost of the arbitrator shall be shared equally by
the parties. The decision of the arbitrator shall be final and binding upon the
parties.
EMPLOYMENT AGREEMENT PAGE 5
MEDFORD CLINIC & XXX X. XXXX
16. ATTORNEYS' FEES: If any legal proceedings, including arbitration,
shall be instituted to enforce or interpret this Agreement, the prevailing party
shall be entitled to recover from the losing party such sums as the court or
arbitrator may adjudge reasonable for attorneys' fees in such legal or
arbitration proceedings, including attorneys' fees on appeal.
17. GOVERNING LAW: This Agreement is drawn to be effective in and shall
be construed in accordance with the laws of the State of Oregon.
18. ASSIGNMENT OF CONTRACT: This contract is not assignable by Employee
to any other individual.
19. ENTIRE AGREEMENT: This Agreement constitutes the entire understanding
and agreement between the parties, and no amendment or variation of the terms of
this Agreement shall be valid unless made in writing and signed by Employee and
a duly authorized representative of Employer.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
date first herein above mentioned.
Medford Clinic, P.C.
by /s/ B. Van Zee, M.D. /s/ Xxx Xxxx
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Xxxxx X. Xxx Xxx, M.D. "Employee"
President
