EXHIBIT 10.1
AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT
This Amended and Restated Executive Employment Agreement (the
"Agreement") is made and executed to be effective as of the 16th day of May,
2002, by and between Symbion, Inc. (the "Company"), and XXXXXXX X. XXXXXXX, XX.,
an individual and resident of Nashville, Tennessee ("Executive").
RECITALS:
WHEREAS, the Company and Executive are parties to that certain
Executive Employment Agreement dated as of March 14, 1996, that was first
amended and restated effective May 11, 2000 (the "Employment Agreement"); and
WHEREAS, the Company and Executive desire to amend and restate and to
supercede in all prior writings evidencing the Employment Agreement in the
manner set forth herein;
NOW, THEREFORE, in consideration of the mutual undertakings of the
parties set forth in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Company and Executive hereby agree as follows:
1. Employment. The Company hereby employs Executive, and
Executive hereby accepts employment with the Company, on the terms and
conditions hereinafter set forth.
2. Term. The initial term of this Agreement shall commence and
shall be effective as of May 16, 2002, (the "Effective Date") and shall extend
from that date for a period of three (3) years, unless earlier terminated as
provided in Section 8 or 9 of this Agreement (the "Employment Term"). At the
beginning of each month after the Effective Date in which Executive is employed
by the Company, the term of this Agreement shall automatically be extended for
an additional month so that the Employment Term on such date is a period of
three (3) years.
3. Nature of Duties and Responsibilities. During the Employment
Term, Executive shall be employed by the Company as its chief executive officer
and shall have such duties, powers and authority as generally inure to that
office. Executive shall have the full authority and responsibility for
formulating the essential strategic plans and policies of the Company and for
administering the same. Executive shall report only to the Company's Board of
Directors (the "Board"), or any designated committee thereof, and shall not be
subordinate to any other officer or employee of the Company.
4. Extent of Services. Executive shall devote his full time,
attention, skills and energies during the Employment Term to the business of the
Company. During the Employment Term, Executive shall not be engaged in any other
business activity that conflicts with or detracts from his duty to the Company
or with the business of the Company, whether or not such business activity is
pursued for gain, profit or other pecuniary advantage. Notwithstanding the
foregoing, Executive may, at his option, devote reasonable time and attention to
personal investments and to civic, charitable or social organizations as he
deems appropriate. It is anticipated that Executive will devote a reasonable
amount of time to serving on the board of directors of one or more public
or private corporations, provided that the business activities of any such
corporation are not competitive with those of the Company.
5. Location. The permanent place of employment of Executive shall
be the corporate headquarters of the Company located in Nashville, Tennessee.
Executive shall not be required to relocate his place of employment at any time
during the Employment Term without his prior consent, which consent may be
withheld by Executive for any reason he deems appropriate. Executive may be
required to conduct reasonable travel in the course of the performance of his
duties on behalf of the Company.
6. Compensation.
(a) For all services rendered by Executive under this
Agreement, the Company shall compensate Executive at Executive's current annual
base rate of $295,260.
(b) The annual rate of compensation provided in Section
6(a) may be adjusted upward effective on January 1 for each year during the
Employment Term by an amount determined by the Compensation Committee of the
Company's Board of Directors in its sole discretion. Executive is not entitled
to any guaranteed annual increase in his rate of compensation.
(c) During the Employment Term, Executive shall be
eligible to receive a bonus payment each year that is equal to a percentage of
the amount of compensation that is in effect under Section 6(a). The percentage
shall be determined by reference to the level of achievement by Executive of the
annual performance goals that are established by the compensation committee of
the Board so that the bonus is 100% of the amount specified in Section 6(a) if
Executive achieves at least 100% of the performance goals. The percentage shall
be reduced to correspond to achievement that is less than 100%, provided that no
bonus shall be payable under this provision if achievement is at a level of less
than 80% of the performance goals. The Executive shall be eligible for
additional bonus payments upon achievement of such other performance targets
that are specified by the compensation committee of the Board.
(d) The Company shall be entitled to withhold such
amounts on account of employment and payroll taxes and similar matters required
by applicable law, rule or regulation of any appropriate governmental authority.
(e) The Company shall continue to pay Executive his
compensation during any period of physical or mental incapacity or disability,
but shall not be obligated to pay Executive any compensation for any continuous
period of physical or mental incapacity or disability after Executive is
determined to be disabled by the Board, as provided in Section 8(g).
(f) During the Employment Term, the Company shall pay the
reasonable expenses incurred by Executive (based on business development
objectives and within limits that may be established by the Board) in the
performance of his duties under this Agreement (or shall reimburse Executive on
account of such expenses paid directly by Executive) promptly upon the
submission to the Company by Executive of appropriate vouchers prepared in
accordance with applicable regulations of the Internal Revenue Service.
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7. Other Benefits.
(a) Executive shall be entitled to and eligible for group
health, life and disability insurance coverage, vacation, and any other fringe
benefits that may from time to time be available to other salaried employees of
the Company. Executive may participate in any other pension, profit sharing or
other employee benefit plan of the Company or in which the Company participates.
Any and all such benefits provided in this Section 7(a) shall terminate on the
expiration or earlier termination of this Agreement, except as otherwise
required by law or as otherwise provided herein.
(b) Executive shall be eligible to participate in each
stock option or stock award plan or program now or hereafter maintained by the
Company, and Executive shall participate in each such plan or program to the
extent, and upon such terms and conditions, as generally applicable to other key
management personnel of the Company.
8. Termination.
(a) Termination for Cause. Prior to the end of the stated
or extended term of this Agreement, the Company may terminate this Agreement for
cause, as provided below, without any further liability hereunder to Executive.
The Company may terminate Executive for cause without notice in the event that
Executive (i) has committed any act of willful misconduct, fraud or dishonesty
that relates to the business of the Company; or (ii) is convicted of a felony
which in the reasonable judgment of the Board materially affects Executive's
ability to perform his duties pursuant to this Agreement. In addition, the
Company may terminate Executive for cause in the event of intentional neglect of
or material inattention to Executive's duties, which neglect or inattention
remains uncorrected for more than 30 days following written notice from the
Board detailing the Board's concern; provided, however, that the Company may
terminate Executive pursuant to this sentence only if each of the following
conditions is satisfied: (1) any determination to terminate Executive must be
made upon the affirmative vote of two-thirds of the non-management directors of
the Company; (2) the Company must provide to Executive at least thirty (30) days
prior written notice of the termination date determined by such directors, which
notice must contain a reasonably specific explanation of the reasons for
termination determined by such directors; (3) Executive shall have the
opportunity during such notice period to cure the deficiencies or failures cited
as the basis for his termination; and (4) upon expiration of the aforementioned
notice period, a new determination must be made upon the affirmative vote of
two-thirds of the non-management directors of the Company that Executive has not
adequately cured the deficiencies or failures cited as the basis for his
termination, upon which determination the termination of Executive shall be
effective.
(b) Termination Without Cause. Prior to the end of the
stated or extended term of this Agreement, the Company may terminate this
Agreement other than as provided in Section 8(a), upon thirty (30) days prior
written notice to Executive. In such event, the Company shall pay to Executive
the amounts required under Section 8(h).
(c) Death of Executive. In the event Executive's death
occurs during the stated or extended term of this Agreement, the Company shall
pay to the estate of Executive all accrued
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but unpaid compensation earned to the date of death. This Agreement otherwise
shall terminate in all respects upon Executive's death.
(d) Voluntary Resignation. Executive may, upon thirty
(30) days prior written notice to the Company, voluntarily resign and thereby
terminate this Agreement at any time prior to the expiration of the stated or
extended term of this Agreement. In such event, the Company shall pay to
Executive all accrued but unpaid compensation earned to the effective date of
resignation. Executive shall not be entitled to any benefits under this
Agreement after the effective date of resignation.
(e) Change of Duties. Executive may, upon thirty (30)
days prior written notice to the Company, voluntarily resign and thereby
terminate this Agreement at any time after there has been a material reduction
in his duties, powers or authority as an officer or employee of the Company (a
"Material Change"). In such event, the Company shall pay to Executive the
amounts required under Section 8(h). For purposes of this Agreement, a Material
Change shall be deemed to have occurred if (i) any person other than Executive
is elected by the Board to hold the office of chief executive officer (or any
substantially equivalent office), (ii) Executive is made subordinate to any
other officer or employee of the Company, or (iii) Executive ceases to be the
chairman of the Board at any time for any reason other than his resignation or
removal by the Board for cause (as defined in Section 8(a)).
(f) Material Breach by Company. In the event that the
Company materially breaches this Agreement, which breach is not cured by the
Company within ninety (90) days of the date on which written notice of such
breach is provided by Executive to the Company, Executive may thereafter
voluntarily resign and thereby terminate this Agreement. In such event, the
Company shall pay to Executive the amounts required under Section 8(h).
(g) Disability. In the event that Executive is unable to
perform his services under this Agreement for a continuous period of one hundred
eighty (180) days during the term of this Agreement and Executive is determined
to be disabled under the Company's long-term disability plan, the Company may
terminate Executive's employment and the Board may remove Executive from his
position on the Board without further liability to Executive, except as
specified in Section 8(h).
(h) Severance Benefits. Except for a termination of
employment following a Change in Control (as provided in Section 9) or the
disability of Executive (as provided in Section 8(g)), if (i) the Company
terminates the employment of Executive without cause (as provided in Section
8(b)), (ii) Executive elects to resign and terminate this Agreement upon the
occurrence of a Material Change (as provided in Section 8(e)), or (iii)
Executive elects to resign and terminate this Agreement upon the occurrence of a
material breach of this Agreement by the Company (as provided in Section 8(f)),
then, in addition to all accrued but unpaid compensation earned to the effective
date of such termination, the Company shall pay to Executive a severance benefit
in an amount equal to (1) three times the Executive's rate of annual base
compensation determined by reference to the highest base salary rate in effect
at any time during the 12-month period prior to the Change of Control; (2) three
times the 100% bonus that is payable under Section 6(c), as if the performance
goals set by the Board had been fully achieved without regard to actual
achievement; and (3) continuation of benefits at no cost under the benefit
programs specified in Section 7(a) for
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the period of time that he is eligible for continuation coverage under the
Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"). Upon a
termination of employment due to Executive's disability pursuant to Section
8(g), Company shall pay Executive 75% of the base salary then in effect as set
forth in Section 6(a) (reduced by any Company-provided disability insurance
benefits), commencing upon the determination of Employee's disability by the
Board and continuing until the first to occur of (i) 36 months or (ii) the death
of Employee, and Executive shall receive benefits at no cost under the benefit
programs specified in Section 7(a) for the period of time that he is eligible
for continuation coverage under COBRA. Nothing in this Section 8(h) is intended
to affect any vesting provisions applicable to any stock option or stock award
of Executive in effect as of the date his employment is terminated.
9. Termination After a Change in Control. Notwithstanding
anything to the contrary contained herein, if within the 120 day period
following a Change in Control (as defined herein), Executive's employment with
the Company terminates for any reason, other than a termination by the Company
for "cause" described in Section 8(a), Company will pay Executive the
Termination Payment described in Section 9(b) and the Gross-up Payment as
described in Section 9(c).
(a) Change in Control. A "Change in Control" shall mean
the occurrence at any time during the Employment Term of any one of the
following events:
(i) An acquisition (other than directly from the Company)
of any voting securities of the Company (the "Voting Securities") by
any "Person" (as that term is used for purposes of Section 13(d) or
14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), immediately after which such Person has "Beneficial Ownership"
(within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of more than fifty percent (50%) of the combined voting power of the
Company's then outstanding Voting Securities; provided, however, in
determining whether a Change in Control has occurred, Voting Securities
which are acquired in a Non-Control Acquisition shall not constitute an
acquisition which would cause a Change in Control. A "Non-Control
Acquisition" shall mean an acquisition by (1) an employee benefit plan
(or a trust forming a part thereof) maintained by (A) the Company, or
(B) any corporation or other Person of which a majority of its voting
power or its voting equity securities or equity interest is owned,
directly or indirectly, by the Company (for purposes of this
definition, a "Subsidiary"), (2) the Company or its Subsidiaries, or
(3) any Person in connection with a Non-Control Transaction (as
hereinafter defined);
(ii) The individuals who, as of the date of this
Agreement, are members of the Board (the "Incumbent Board"), cease for
any reason to constitute at least a majority of the members of the
Board; provided, however, that if the election, or nomination for
election by the Company's stockholders, of any new director was
approved by a vote of at least a majority of the Incumbent Board, such
new director shall, for purposes of this Agreement, be considered as a
member of the Incumbent Board; provided, further, however, that no
individual shall be considered a member of the Incumbent Board if such
individual initially assumed office as a result of either an actual or
threatened "Election Contest" (as described in Rule 14a-11 promulgated
under the Exchange Act) or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other
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than the Company's Board of Directors (a "Proxy Contest") including by
reason of any agreement intended to avoid or settle any Election
Contest or Proxy Contest; or
(iii) Approval by stockholders of the Company of:
(1) A merger, consolidation or reorganization
involving the Company, unless such merger, consolidation or
reorganization is a Non-Control Transaction. A "Non-Control
Transaction" shall mean a merger, consolidation or
reorganization of the Company where:
(A) the stockholders of the Company,
immediately before such merger, consolidation or
reorganization, own directly or indirectly
immediately following such merger, consolidation or
reorganization, more than fifty percent (50%) of the
combined voting power of the outstanding voting
securities of the corporation resulting from such
merger or consolidation or reorganization (the
"Surviving Corporation") in substantially the same
proportion as their ownership of the Voting
Securities immediately before such merger,
consolidation or reorganization; and
(B) the individuals who were members of
the Incumbent Board immediately prior to the
execution of the agreement providing for such merger,
consolidation or reorganization constitute at least a
majority of the members of the board of directors of
the Surviving Corporation, or a corporation
beneficially directly or indirectly owning a majority
of the voting securities of the Surviving
Corporation;
(2) A complete liquidation or dissolution of the
Company; or
(3) An agreement for the sale or other
disposition of all or substantially all of the assets of the
Company to any Person (other than a transfer to a Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not be deemed
to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the then
outstanding Voting Securities as a result of the acquisition of Voting
Securities by the Company which, by reducing the number of Voting
Securities than outstanding, increases the proportional number of
shares Beneficially Owned by the Subject Person, provided that if a
Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of Voting Securities by the Company, and
after such share acquisition by the Company, the Subject Person becomes
the Beneficial Owner of any additional Voting Securities which
increases the percentage of the then outstanding Voting Securities
Beneficially Owned by the Subject Person, then a Change in Control
shall occur.
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(b) Termination Payment. The "Termination Payment" shall
be a cash payment to the Executive that is the sum of the following:
(i) Three times the Executive's rate of annual base
compensation determined by reference to the highest base salary rate in
effect at any time during the 12-month period prior to the Change of
Control;
(ii) Three times the 100% bonus that is payable under
Section 6(c), as if the performance goals set by the Board had been
fully achieved, without regard to actual achievement; and
(iii) Continuation of benefits at no cost under the benefit
programs specified in Section 7(a) for the period of time that he is
eligible for continuation coverage under COBRA.
(c) Gross Up Payment. Anything in this Agreement to the
contrary notwithstanding, in the event it shall be determined that any payment
or distribution by or on behalf of the Company to or for the benefit of
Executive as a result of a change in control (within the meaning of section 280G
of the Internal Revenue Code (the "Code")) (whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise, but determined without regard to any additional payments required
under this Section 9(c) (a "Payment")) would be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code (the "Code"), or any
interest or penalties are incurred by Executive with respect to such excise tax
(such excise tax, together with any such interest and penalties, are hereinafter
collectively referred to as the "Excise Tax"), then Executive shall be entitled
to receive an additional payment (a "Gross-Up Payment") in an amount such that
after payment by Executive of all taxes (including any interest or penalties
imposed with respect to such taxes), including, without limitation, any income
taxes (and any interest and penalties imposed with respect thereto) and Excise
Tax imposed upon the Gross-Up Payment, Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments.
(i) Tax Opinion. Subject to the provisions of Section
9(c)(ii), all determinations required to be made under this Section
9(c), including whether and when a Gross-Up Payment is required and the
amount of such Gross-Up Payment and the assumptions to be utilized in
arriving at such determination, shall be made by a nationally
recognized accounting firm or law firm selected by the Executive
(subject to the reasonable consent of the Company) (the "Tax Firm");
provided, however, that the Tax Firm shall not determine that no Excise
Tax is payable by Executive unless it delivers to Executive a written
opinion (the "Tax Opinion") that failure to pay the Excise Tax and to
report the Excise Tax and the payments potentially subject thereto on
or with Executive's applicable federal income tax return will not
result in the imposition of an accuracy-related or other penalty on
Executive. All fees and expenses of the Tax Firm shall be borne solely
by the Company. Within 15 business days of the receipt of notice from
Executive that there has been a Payment, or such earlier time as is
requested by the Executive or the Company, the Tax Firm shall make all
determinations required under this Section 9(c), shall provide to the
Company and Executive a written report setting forth such
determinations, together with detailed supporting
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calculations, and, if the Tax Firm determines that no Excise Tax is
payable, shall deliver the Tax Opinion to Executive. Any Gross-Up
Payment, as determined pursuant to this Section 9(c), shall be paid by
the Company to Executive within fifteen days of the receipt of the Tax
Firm's determination. Subject to the remainder of this Section 9(c),
any determination by the Tax Firm shall be binding upon the Company and
Executive; provided, however, that Executive shall only be bound to the
extent that the determinations of the Tax Firm hereunder, including the
determinations made in the Tax Opinion, are reasonable and reasonably
supported by applicable law. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial
determination by the Tax Firm hereunder, it is possible that Gross-Up
Payments which will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations required to be
made hereunder. In the event that it is ultimately determined in
accordance with the procedures set forth in Section 9(c)(ii) that
Executive is required to make a payment of any Excise Tax, the Tax Firm
shall reasonably determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly paid by the
Company to or for the benefit of Executive. In determining the
reasonableness of Tax Firm's determinations hereunder, and the effect
thereof, Executive shall be provided a reasonable opportunity to review
such determinations with Tax Firm and Executive's tax counsel. Tax
Firm's determinations hereunder, and the Tax Opinion, shall not be
deemed reasonable until Executive's reasonable objections and comments
thereto have been satisfactorily accommodated by Tax Firm.
(ii) Notice of IRS Claim. Executive shall notify the
Company in writing of any claims by the Internal Revenue Service that,
if successful, would require the payment by the Company of the Gross-Up
Payment. Such notification shall be given as soon as practicable but no
later than 30 calendar days after Executive actually receives notice in
writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid;
provided, however, that the failure of Executive to notify the Company
of such claim (or to provide any required information with respect
thereto) shall not affect any rights granted to Executive under this
Section 9(c) except to the extent that the Company is materially
prejudiced in the defense of such claim as a direct result of such
failure. Executive shall not pay such claim prior to the expiration of
the 30-day period following the date on which he gives such notice to
the Company (or such shorter period ending on the date that any payment
of taxes with respect to such claim is due). If the Company notifies
Executive in writing prior to the expiration of such period that it
desires to contest such claim, Executive shall do all of the following:
(1) give the Company any information reasonably
requested by the Company relating to such claim;
(2) take such action in connection with
contesting such claim as the Company shall reasonably request
in writing from time to time, including, without limitation,
accepting legal representation with respect to such claim by
an attorney selected by the Company and reasonably acceptable
to Executive;
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(3) cooperate with the Company in good faith in
order effectively to contest such claim;
(4) if the Company elects not to assume and
control the defense of such claim, permit the Company to
participate in any proceedings relating to such claim;
provided, however, that the Company shall bear and pay directly all
costs and expenses (including additional interest and penalties)
incurred in connection with such contest and shall indemnify and hold
Executive harmless, on an after-tax basis, for any Excise Tax or income
tax (including interest and penalties with respect thereto) imposed as
a result of such representation and payment of costs and expenses.
Without limiting the foregoing provisions of this Section 9(c), the
Company shall have the right, at its sole option, to assume the defense
of and control all proceedings in connection with such contest, in
which case it may pursue or forego any and all administrative appeals,
proceedings, hearings and conferences with the taxing authority in
respect of such claim and may either direct Executive to pay the tax
claimed and xxx for a refund or contest the claim in any permissible
manner, and Executive agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs Executive to
pay such claim and xxx for a refund, the Company shall advance the
amount of such payment to Executive, on an interest-free basis and
shall indemnify and hold Executive harmless, on an after-tax basis,
from any Excise Tax or income tax (including interest or penalties with
respect thereto) imposed with respect to such advance or with respect
to any imputed income with respect to such advance; and further
provided that any extension of the statute of limitations relating to
payment of taxes for the taxable year of Executive with respect to
which such contested amount is claimed to be due is limited solely to
such contested amount. Furthermore, the Company's right to assume the
defense of and control the contest shall be limited to issues with
respect to which a Gross-Up Payment would be payable hereunder and
Executive shall be entitled to settle or contest, as the case may be,
any other issue raised by the Internal Revenue Service or any other
taxing authority.
(iii) Right to Tax Refund. If, after the receipt by
Executive of an amount advanced by the Company pursuant to Section 9(c)
Executive becomes entitled to receive any refund with respect to such
claim, Executive shall (subject to the Company's complying with the
requirements of Section 9(c)(ii)) promptly pay to the Company the
amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by
Executive of an amount advanced by the Company pursuant to Section
9(c)(ii), a determination is made that Executive is not entitled to a
refund with respect to such claim and the Company does not notify
Executive in writing of its intent to contest such denial of refund
prior to the expiration of 30 days after such determination, then such
advance shall, to the extent of such denial, be forgiven and shall not
be required to be repaid and the amount of forgiven advance shall
offset, to the extent thereof, the amount of Gross-Up Payment required
to be paid.
10. Time for Payment; Interest. The severance payment described in
Section 8 and the Termination Payment described in Section 9 shall be paid to
Executive in a single lump sum within 15 days following the date of termination,
provided that the Gross-Up Payment described in Section
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9(c) shall be payable in accordance with the procedures described therein. The
Company's obligation to pay to Executive any amounts under this Agreement will
bear interest at the prime rate as quoted in The Wall Street Journal plus 2%,
and all accrued and unpaid interest will bear interest at the same rate, all of
which interest will be compounded annually.
11. Restrictive Covenant. Executive hereby covenants and agrees
that during the Employment Term and for a period of one (1) year thereafter,
Executive shall not, directly or indirectly: (a) own, manage, operate, control,
be employed by, consult with, participate in or be connected in any manner with,
the operation, ownership, management or control of any enterprise predominantly
engaged in the management of physician practices or the ownership and management
of outpatient surgery centers (other than the Company or its affiliates); (b) be
employed by or consult with any organization in which Executive is primarily
engaged in maintaining the operation, ownership, management or control of a
business unit that is predominantly engaged in the management of physician
practices or the ownership and management of outpatient surgery centers that is
competitive with the Company; or (c) induce any employee of the Company to leave
the employ of the Company or solicit the business of any client or customer of
the Company (other than on behalf of the Company). Notwithstanding the
foregoing, Executive may own, directly or indirectly, solely as an investment,
securities of any publicly-traded corporation or other business entity, provided
that Executive does not own, directly or indirectly, more than one percent (1%)
of any class of voting securities of any such corporation or other business
entity. The foregoing covenants and agreements of Executive are referred to
herein as the "Restrictive Covenant."
(a) Executive has carefully read and considered the
provisions of-the Restrictive Covenant and, having done so, agrees that the
restrictions set forth in this Section 11, including without limitation the time
period of restriction and the geographic areas of restriction set forth above,
are fair and reasonable and are reasonably required for the protection of the
legitimate business interests of the Company.
(b) Executive acknowledges that the Company's business is
and will be built upon the confidence of those with whom it conducts business
and that Executive will gain acquaintances and develop relationships by using
the good will of the Company. Executive also acknowledges that the Company's
business is and will be built upon the success of the Company in research,
development and marketing, and through the development of certain business
methods and trade secrets, and that Executive's position will give him
confidential knowledge of all aspects of the Company's business and internal
operations. In addition, Executive acknowledges that the Company's dealings
through Executive will give Executive confidential knowledge that should not be
divulged or used for his own benefit. Executive recognizes and agrees that his
violation of any provision of the Restrictive Covenant will cause irreparable
harm to the Company.
(c) In the event that, notwithstanding the foregoing, any
of the provisions of this Section 11 or any parts hereof shall be held to be
invalid or unenforceable, the remaining provisions or parts hereof shall
nevertheless continue to be valid and enforceable as though the invalid or
unenforceable portions or parts had not been included herein. In the event that
any provision of this Section 11 relating to the time period and/or the areas of
restriction and/or related aspects shall be declared by a court of competent
jurisdiction to exceed the maximum
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restrictiveness such court deems reasonable and enforceable, the time period
and/or areas of restriction and/or related aspects deemed reasonable and
enforceable by such court shall become and thereafter be the maximum
restrictions in such regard, and the provisions of the Restrictive Covenant
shall remain enforceable to the fullest extent deemed reasonable by such court.
12. Remedies. Executive agrees that in the event of any conduct by
Executive violating any provision of Section 11, the Company shall be entitled,
if it so elects, to institute and prosecute proceedings in any court of
competent jurisdiction, either at law or in equity, to obtain damages for such
conduct, to enforce specific performance of such provision, to enjoin Executive
from such conduct, to obtain an accounting and repayment of all profits,
compensation, commissions, remuneration or other benefits that Executive
directly or indirectly has realized and/or may realize as a result of, growing
out of, or in connection with any such violation, or to obtain any other relief,
or any combination of the foregoing, that the Company may elect to pursue.
13. Waiver of Breach. The waiver by either party of a breach of
any provisions of this Agreement by either party shall not operate or be
construed as a waiver of any subsequent breach by either party.
14. Successors. This Agreement shall be binding upon and accrue to
the benefit of any successors and assigns of the Company. This Agreement is not
assignable by Executive or by the Company, except upon the agreement of both
parties.
15. Construction. This Agreement shall be construed under and
enforced in accordance with the laws of the State of Tennessee.
16. Entire Agreement. This Agreement is the entire agreement of
the parties and supersedes all prior agreements and understandings, written or
oral, including, without limitation, the Employment Agreement. This Agreement
shall not be amended or modified except in writing executed by both parties.
17. Notice. For the purposes of this Agreement, notices shall be
deemed given when mailed by United States certified or registered mail, return
receipt requested, postage prepaid, addressed in the case of the Company to its
principal executive office; or in the case of Executive to the address shown on
the signature page of this Agreement. Either party may change such address by
giving the other party notice of such change in the aforesaid manner, except
that notices of changes of address shall only be effective upon receipt.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
SYMBION, INC.
By: /s/ Xxxxx X. Xxxxx
--------------------------------------
Xxxxx X. Xxxxx, Compensation Committee
For the Board of Directors
EXECUTIVE:
/s/ Xxxxxxx X. Xxxxxxx, Xx.
--------------------------------------
Xxxxxxx X. Xxxxxxx, Xx.
Address:
000 Xxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
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