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HEALTHSOURCE, INC.
Xxx Xxxxxxx Xxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxxxxx 00000
February 14, 1997
Xxxx Xxxxxx, M.D., Ph.D.
000 Xxxxxxxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
Dear Dick:
This letter of agreement confirms your transition to Senior Vice President of
Medical Affairs.
1. Annual Salary for 1997 to be determined. Your 1996 salary was $225,000.
2. Annual Performance Based Bonus for 1996 to be determined, maximum
potential 25%.
3. Stock Option Plan
Participation in the stock option plan on the same basis as other
senior management executives.
4. Benefits
Healthsource benefits at the same level as our other executives.
5. Termination
This agreement may be terminated at will with or without cause by you
upon thirty (30) days written notice. If you terminate this agreement,
you shall not be eligible for any severance benefits and shall not have
the right to exercise any stock options in which you are not fully
vested. The non-competition agreement shall, however, remain in force.
Should your employment be terminated with or without cause, or have
your duties and responsibilities materially altered, you will be
provided with twelve (12) months of salary continuation at your salary
of record at that time or your 1996 salary (whichever
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HEALTHSOURCE, INC.
Xxx Xxxxxxx Xxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxxxxx 00000
XXXX XXXXXX, M.D., PH.D.
February 14, 1997
Page 2
is greater) plus your bonus eligibility of record. An additional month
of salary continuation will be given for each year of full-time
employment.
6. Protection of Proprietary Information and Non-compete
In your position with Healthsource, you will have access to and become
familiar with Healthsource trade secrets, business practices and
strategies (such as marketing and provider development strategies and
financing, many of which have been developed over time and at great
expense), and confidential information regarding customers, patients,
and health care practitioners. It would be extremely prejudicial to
Healthsource for this information to be made directly or indirectly
available to competitors, or for it to be used to Healthsource's
disadvantage in the managed care marketplace. In order to protect
Healthsource from such potential harm, you agree that during the time
of your employment with Healthsource, any of its affiliates, or
successors, and for six (6) months thereafter, you will not, on your
own behalf or for any other person or employer, compete or aid
competition in any capacity with Healthsource and/or any of its
affiliates in any state in which Healthsource or one of its affiliates
is operating.
This "Covenant Not to Compete" is material to Healthsource and our
offer of employment is contingent on your agreement to the Covenant.
Your acceptance of our offer will automatically include acceptance of
the Covenant and acknowledgement that it is reasonable. You also agree
that we can enforce the Covenant by asking a court for an injunction to
prevent a breach of the Covenant, and/or to assess money damages for
its breach that is based on damages caused to Healthsource by your
breach of the Covenant Not to Compete. A court is empowered to
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HEALTHSOURCE, INC.
Xxx Xxxxxxx Xxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxxxxx 00000
XXXX XXXXXX, M.D., PH.D.
February 14, 1997
Page 3
restrict the scope of the Covenant if it finds that it is too broad and
to enforce it as restricted.
7. Non-solicitation
As an additional condition of your employment on the terms set forth
above, during your employment and for a period of one (1) year
thereafter, you shall not, directly or indirectly, employ, attempt to
employ, recruit or otherwise solicit, induct or influence to leave
his/her employment any employee of Healthsource or its subsidiaries.
We are very pleased with your continued employment with Healthsource.
Sincerely,
/s/ Xxxx Xxxxxx
-----------------------------
Xxxx Xxxxxx, M.D.
President and
Chief Executive Officer
/kmc
By signing below, I indicate my
acceptance of the terms of this
employment agreement.
/s/ Xxxx Xxxxxx 2/14/97
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