Exhibit 10.14
AMENDMENT TO
SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This AMENDMENT TO SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT
("Amendment"), dated as of November 26, 2003, amends that certain Second Amended
and Restated Employment Agreement, made effective as of August 6, 2002, by and
between PSYCHIATRIC SOLUTIONS, INC., a Delaware corporation (the "Company")
(f/k/a PMR Corporation), and XXXX XXXXXX (the "Executive").
WHEREAS, the Company and the Executive are parties to that certain
Second Amended and Restated Employment Agreement, made effective as of August 6,
2002 (the "Agreement"); and
WHEREAS, the Company and the Executive now desire to amend certain terms
of the Agreement and to ratify and confirm all other terms contained in the
Agreement.
NOW, THEREFORE, in consideration of good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and the mutual
covenants contained in this Amendment, the parties hereby agree as follows:
1. Amendments.
(a) Exhibit "A" to Section IV B. is hereby deleted in its
entirety and replaced with the following:
"Commencing with fiscal year 2004, Executive shall receive a cash bonus
based upon the achievement of target/business plan financial objectives approved
by the Board of Directors at the beginning of each fiscal year. If the Company
fails to achieve the target/business plan objectives for a fiscal year,
Executive shall not receive a cash bonus. Executive shall receive a cash bonus
equal to 60% of his Base Salary for such fiscal year if the Company meets, but
does not exceed, its target/business plan objectives. If the Company exceeds its
target/business plan financial objectives, Executive shall receive a cash bonus
equal to not less than 60% nor more than 90% of his Base Salary for such fiscal
year, the exact percentage to be determined by the Compensation Committee of the
Company's Board of Directors; provided that Executive shall receive a cash bonus
equal to 90% of his Base Salary if the Company exceeds its target/business plan
financial objectives by 150% or more."
(b) Section VIII A. shall be amended by inserting the following
sentence at the end of such Section: "If the Company notifies Executive of its
intent not to extend Executive's Period of Employment pursuant to Section III A.
hereof, such notification shall constitute a termination of Executive's
employment Without Cause for all purposes under this Agreement, and Executive
shall be entitled to receive all payments and benefits provided for in this
Agreement upon a termination Without Cause, including, without limitation, the
payments and benefits set forth in this Section VIII A."
(c) The following shall be added as Section VIII F.:
F. If there is a determination that the payments and other benefits
provided for under this Agreement, in combination with any other payments or
benefits to or for the benefit of the Executive from the Company or any
predecessor or successor organization, will result in the Executive's being
subject to an excise tax under Section 4999 of the Internal Revenue Code of
1986, as amended (the "Code"), and/or if such an excise tax is assessed against
the Executive as a result of such payments or other benefits, the Company shall
make a Gross Up Payment (as defined below) to or on behalf of the Executive as
and when any such determination or assessment, as appropriate, is made, provided
the Executive takes such action as the Company reasonably requests under the
circumstances to mitigate or challenge such excise tax, and the Company complies
with its obligations described below in this Section VIII F.
A "Gross Up Payment" means a payment to or on behalf of the Executive
which shall be sufficient to pay (i) any such excise tax in full, (ii) any
federal, state and local income tax and social security and other employment tax
on the payment made to pay the Executive's excise tax as well as any additional
excise tax on such payment and (iii) any interest or penalties assessed by the
Internal Revenue Service on the Executive if such interest or penalties are
attributable to the Company's failure to comply with its obligations under this
Section VIII F. or applicable law. Any determination under this Section VIII F.
by the Company or the Company's accountants shall be made in accordance with
Section 280G of the Code and any applicable related regulations (whether
proposed, temporary or final) and any related Internal Revenue Service rulings
and any related case law and, if the Company reasonably requests that the
Executive take action to mitigate or challenge any such tax or assessment and
the Executive complies with such request, the Company shall provide the
Executive with such information and such expert advice and assistance from the
Company's accountants, lawyers and other advisors as he may reasonably request
and shall pay for all expenses incurred in effecting such compliance and any
related fines, penalties, interest and other assessments.
2. Amendment and Ratification. The Agreement is hereby amended in
accordance with the foregoing provisions of this
Amendment. The Agreement, as amended as provided herein, is hereby ratified and
shall remain in full force and effect.
3. Defined Terms. Capitalized terms used in this Amendment shall have
the same meanings as in the Agreement unless otherwise defined
herein.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
COMPANY:
PSYCHIATRIC SOLUTIONS, INC.
By: /s/ Xxxxxxxxxxx Xxxxx, Jr.,
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Xxxxxxxxxxx Xxxxx, Jr.,
Chairman, Compensation Committee
EXECUTIVE:
/s/ Xxxx X. Xxxxxx
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XXXX X. XXXXXX
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