Exhibit 10.6a
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
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This First Amendment dated as of September 27, 1996, is to the
Employment Agreement between Value Health, Inc. (the "Company") and Xxxxxx X.
Xxxxxxx (the "Executive"), dated as of March 1, 1994 ("Employment Agreement").
W I T N E S S E T H
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WHEREAS, the Company and the Executive desire to amend the Employment
Agreement as follows, as permitted under Section 14 of the Employment Agreement:
1. Section 8 of the Employment Agreement is hereby deleted and the
following is added in its place:
8. Termination After a Strategic Transaction. In the event of a
"Strategic Transaction" of the Company (as defined in Section
17 of this Agreement), if, within twenty-four (24) months
following the closing of such Strategic Transaction (or at
any time prior thereto but in contemplation thereof): (i) the
Executive is terminated without cause; (ii) the Executive is
not retained in an executive position of responsibility,
authority and compensation comparable in all material
respects to the position of the Executive immediately prior
to the Strategic Transaction; (iii) the Executive does not
retain all rights and privileges accorded under this
Agreement as a result of the Strategic Transaction; (iv) the
Executive terminates his employment with the Company due to
either a material reduction in responsibility, authority or
compensation, or a requirement that the Executive relocate,
each on account of the Strategic Transaction; then the
Executive shall receive within five (5) business days
following the date of termination, a lump sum payment (less
all amounts required to be withheld and deducted) equal to 3
times the sum of the Executive's then current base
compensation and annual performance bonus at the target level
for the year in which such termination occurs, and the
Executive shall be deemed to have been terminated without
cause for purposes of Section 7. In addition, in the event of
a termination of the Executive in accordance with the
preceding sentence, the Executive shall receive the same
health benefits available to Company executives, upon the
same terms and conditions and at the same cost to the
Executive, for the lesser of one (1) year from the date of
termination or the first day of the first month in which the
Executive obtains new employment providing health benefits
coverage.
2. Section 17 is hereby added to the Employment Agreement to read in
its entirety as follows:
17. Strategic Transaction. A Strategic Transaction shall be
deemed to occur if at any time during the term of this
Agreement any of the following events occur:
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(i) The Company is merged, consolidated or reorganized
into or with another corporation or other legal
person, and as a result of such merger, consolidation
or reorganization, less than 50% of the combined
voting power of the then-outstanding securities of
such corporation or person immediately after such
transaction are held in the aggregate by the holders
of Voting Stock (as that term is hereafter defined) of
the Company immediately prior to such transaction;
(ii) The Company sells or otherwise transfers all or
substantially all of its assets to any other
corporation or other legal person, and as a result of
such sale or transfer, less than 50% of the combined
voting power of the then-outstanding voting securities
of such corporation or person are held in the
aggregate by the holders of Voting Stock of the
Company immediately prior to such sale;
(iii) There is a report filed on Schedule 13D or Schedule
14D-1 (or any successor schedule, form or report),
each as promulgated pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act"), disclosing
that any person as the term "person" is used in
Section 13(d)(3) or Section 14(d)(2) of the Exchange
Act) has become the beneficial owner (as the term
"beneficial owner" is defined under Rule 13d-3 or any
successor rule or regulation promulgated under the
Exchange Act) of securities representing 20% or more
of the combined voting power of the then-outstanding
securities of the Company entitled to vote generally
in the election of members of the Board of Directors
of the Company ("Voting Stock");
(iv) The Company files a report or proxy statement with the
Securities and Exchange Commission pursuant to the
Exchange Act disclosing in response to Form 8-K or
Schedule 14A (or any successor schedule, form or
report or item therein) that a strategic transaction
of the Company has or may have occurred or will or may
occur in the future pursuant to any then-existing
contract or transaction;
(v) If during the period of two (2) consecutive years
individuals who at the beginning of any such period
constitute the members of the Board of Directors of
the Company (the "Directors") cease for any reason to
constitute at least a majority thereof unless the
election, or the nomination for election by the
Company's shareholders, of each Director first elected
during such period was approved by a vote of at least
two-thirds of the Directors then still in office who
were Directors at the beginning of any such period
(excluding for this purpose the election of any new
Director in connection with an actual or threatened
election of proxy contest);
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(vi) The Company: (i) sells at least 85% of the assets or
outstanding stock of a subsidiary to an unrelated
party (or completes a transaction having a similar
effect), (ii) distributes all or substantially all of
the common stock of a subsidiary as a dividend to
stockholders of the Company; or (iii) sells voting
stock of a subsidiary in an underwritten public
offering.
3. Section 4 of the Employment Agreement is hereby amended by
replacing the first sentence thereof with the following:
The Company shall pay the Executive base compensation for his
services at an annual rate of $420,000.
4. Section 18 is hereby added to the Employment Agreement to read in
its entirety as follows:
18. Indemnification. If there is a final determination that
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any portion of the amounts payable to the Executive under the
Employment Agreement constitutes an "excess parachute
payment" as such term is used in Section 280G and 4999 of the
Internal Revenue Code, then the Company shall pay to the
Executive an additional sum such that after all taxes
applicable to the receipt of such amount have been subtracted
therefrom, the remaining amount will equal the sum of the
amount of the tax imposed with respect to the "excess
parachute payment", plus any interest and penalties thereon.
5. The Employment Agreement, except as herein amended, is hereby
ratified, confirmed and approved in all respects.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
Agreement as of the date written above.
Signed on behalf of
Value Health, Inc.
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Signed by Xxxxxx X. Xxxxxxx
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