EXHIBIT 8
January 6, 1997
Xx. Xxxxx X. Xxxxx
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Dear Xxxxx:
Reference is made to the following documents:
1. The agreement and plan of merger (the "Merger Agreement") dated as of
January 6, 1997 by and among Xxxxxxx Inc. ("Parent"), American Medical Response,
Inc., (the "Company"), and MedTrans Acquisition Co., a wholly-owned subsidiary
of Parent ("Acquisition"). Capitalized terms defined in the Merger Agreement and
not otherwise defined herein are used herein with the meanings so defined.
2. The employment agreement (the "Employment Agreement") dated as of April
1, 1996 between the Company and you (the "Executive").
3. The Company's Executive Separation Allowance Plan (the "Separation
Plan").
Pursuant to the Merger Agreement, Acquisition will make a tender offer to
acquire all outstanding shares of common stock, par value $0.01 per share, of
the Company in accordance with the terms and subject to the conditions provided
for therein (the "Offer"). Subsequent to the Offer, Acquisition will merge with
and into the Company, and the Company will become a wholly-owned subsidiary of
Parent. It is contemplated that the medical transportation and health care
businesses of Parent and its subsidiaries will be consolidated with those of the
Company and its subsidiaries and will be operated under the direction of
executives of the Company.
Contemporaneous with Acquisition's purchase of Shares pursuant to the Offer,
Parent, the Company and the Executive hereby agree as follows:
1. INDUCEMENT PAYMENT. To induce Executive to remain in his position with
the Company and to accept the responsibilities arising from the management of
the Company following the Offer and the Merger, Parent or the Company will pay
or cause to be paid to Executive on August 31, 1997, provided Executive is still
employed by the Company on such date, an amount in cash equal to $841,500. If
prior to August 31, 1997 the Company terminates the Executive's employment other
than for Cause (as defined in the Separation Plan) or if Executive terminates
his employment following any of the events specified in Section III.B of the
Separation Plan, (a) Parent or the Company will pay or cause to be paid to
Executive an amount in cash equal to $841,500 and (b) Executive shall be
entitled to receive the benefits provided for in Section VI of the Separation
Plan.
2. AMENDMENTS TO EMPLOYMENT AGREEMENT. The Employment Agreement is hereby
amended effective upon the consummation of the Offer as follows:
(a) Paragraph (d) of Section 1 is deleted.
(b) Paragraph (a) of Section 2 is amended by deleting "$275,000" and
inserting "$325,000".
(d) Paragraph (b) of Section 2 is amended in its entirety to read as
follows:
"(b) BONUS. Executive shall be eligible for an annual performance bonus
with a target of 50% of Executive's base salary, which performance bonus
shall be based on quantitative and qualitative performance factors to be
established by the Company. Executive shall also participate in any other
bonus plan that Parent or the Company makes available for senior
executives of the Company."
(e) Paragraph (f) of Section 2 is deleted.
(f) The first sentence of Paragraph (b) of Section 6 is amended to read as
follows:
"(b) Upon termination of Executive's employment pursuant to clause (i) of
paragraph 6(a), by the Company pursuant to clause (iii) of paragraph 6(a)
(other than upon expiration of the initial or any successive term after
notice in accordance with paragraph 6(a)) or by the Executive for Good
Reason pursuant to clause (iv) of paragraph 6(a), Executive shall be
entitled to receive (i) all cash compensation earned under this Agreement
to the date of termination PLUS (ii) in respect of the bonus amount
payable pursuant to the first sentence of paragraph (b) of Section 2, an
amount equal to the greater of the amount of any bonus paid to the
Executive during the preceding twelve months or 50% of the Executive's
then current base salary prorated for any partial year prior to
termination PLUS (iii) in respect of any other bonus plan in which
Executive is then participating, an amount that reflects the achievement
of any performance goals under such plan to the date of termination.
(g) Paragraph (c) of Section 6 is amended by deleting the reference to
"paragraph 7(a)" and inserting therefor a reference to "paragraph 6(a)".
3. OPTIONS TO PURCHASE PARENT COMMON STOCK. On the date on which the Merger
Agreement is executed and delivered, Parent shall grant to the Executive,
subject to the consummation of the Offer, an option to purchase 30,000 shares of
Parent's Class B Non-Voting Shares at an exercise price equal to the closing
price of the Shares on the New York Stock Exchange on the immediately preceding
day. Such option will vest in five equal annual installments beginning on the
first anniversary of the date of grant. In addition, Parent shall in April 1997
approve, and in May 1997 grant, to the Executive an option to purchase an
additional 30,000 shares of Parent's Class B Non-Voting Shares at an exercise
price equal to the fair market value of the Shares at the time of such grant.
Such option will vest in five equal annual installments beginning on the firsts
anniversary of the date of grant.
4. SEPARATION PLAN. Effective upon consummation of the Offer, Executive
waives his right to any payments or benefits due or to become due under the
Separation Plan, except as otherwise provided in clause (b) of the second
sentence of Paragraph 1 above.
Except as specifically set forth herein, the Employment Agreement will
remain in full force and effect.
This Agreement may be executed in any number of counterparts which together
shall constitute one instrument.
XXXXXXX INC. AMERICAN MEDICAL RESPONSE, INC.
By /s/ Xxxx X. Xxxxxx By /s/ Xxxx X. Xxxxxxx
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Title: Senior Vice President and Title: President and Chief
General Counsel Executive Officer
EXECUTIVE:
/s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx
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