EMPLOYMENT SEVERANCE AGREEMENT AND GENERAL RELEASE OF CLAIMS
EMPLOYMENT
SEVERANCE AGREEMENT
AND
GENERAL RELEASE OF CLAIMS
THIS
EMPLOYMENT SEVERANCE AGREEMENT AND GENERAL RELEASE OF
CLAIMS
(the
“Release”)
is
entered into as of January 20, 2006 by and between Integrated Healthcare
Holdings, Inc., (“IHHI”)
a Nevada
corporation and ▇▇▇▇▇ ▇. ▇▇▇▇▇ (“Employee”),
an
individual. IHHI
and
Employee
are
sometimes referred to herein collectively as the “Parties”
or
individually as a “Party”
RECITALS
A.
On or
about June 14, 2003 Employee CO-founded ▇▇▇▇▇ Management Group, Inc. and
Integrated Healthcare Holdings, Inc. Employee served as its EVP Finance/Chief
Financial Officer until July 1, 2005 at which time Employee’s duties and title
were changed to EVP Mergers and Acquisitions.
B.
On
February 25, 2005 Employee entered into an Employment Agreement with IHHI for
a
three year period. This Agreement was modified on June 6, 2005 to include a
three year severance package.
C.
IHHI
and Employee now elect to terminate voluntarily the employment rights and
obligations arising under Employees employment and Employment Agreement and
any
other contractual arrangements as arising between Employee and
IHHI.
D.
The
Parties intend that this Release shall constitute a complete settlement,
compromise and disposition of all potential and actual claims of the Parties
against each other based upon Employees employment and any other collateral
obligations arising between the Parties, except as expressly stated in this
Release.
NOW
THEREFORE,
for
valuable consideration, receipt of which the Parties hereby acknowledge, the
Parties agree as follows:
1. Incorporation
of Recitals.
The
above-stated recitals are incorporated herein fully and made a part of this
Release.
2. Termination
of Employment; Severance Benefits.
A.
Employees employment shall terminate effective as of January 13, 2006 (the
“Effective Date”), upon Parties execution and delivery of this Release.
Notwithstanding anything to the contrary stated in this Release, Employee shall
immediately receive severance compensation (referred to herein as “Severance
Benefits”) of a lump sum payment of three months base salary in the amount of
Ninety Thousand Dollars ($90,000.00), less required withholdings, and accrued
vacation and sick pay benefits in the amount of Four Thousand Six Hundred
Fifty-one Dollars ($4,651.00), less required withholding.
Further,
Employee shall receive Severance Benefits in the amount of Four Hundred Fifty
Thousand Dollars ($450,000.00) paid over fifteen months, less required
withholdings, according to and beginning with Employer’s next regular scheduled
payroll cycle.
B.
During
the fifteen month payout period Employee shall be entitled to continue to
participate in and receive employer paid coverage under IHHI’s group medical and
dental plans, the use of a cellular telephone and a monthly auto allowance
in
the amount of One Thousand Dollars ($1,000.00).
C.
Employee shall resign his voting seat on the IHHI Board of Directors, as well
as
any board committees, effective upon Parties execution and delivery of this
Release.
3. Termination
of Existing Contractual Relationships and Obligations.
Upon the
Effective Date, the Parties specifically acknowledge and agree that any implied
or actual obligation or covenant by Employee to provide services pursuant to
Employees employment shall terminate and any claims related thereto are included
within the general releases set forth in paragraph 4 herein.
4. Release
of Liability.
A.
General
Release of IHHI.
Employee and any and all of his agents, representatives, administrators,
successors-in-interests, all those acting on their behalf and their respective
successors, assigns and executors, and each of them, hereby irrevocably, finally
and fully release, forgives and discharges IHHI and all of their officers,
agents, employees, subsidiaries, shareholders, representatives, administrators,
successors-in-interests, all those acting on their behalf and their respective
successors, assigns and executors, and each of them, from any and all claims,
demands, causes of action, obligations, set-offs, liability, losses, injuries
and damages of any kind or nature whatsoever, whether known or unknown,
suspected or unsuspected, foreseen or unforeseen, liquidated or unliquidated,
apparent or concealed (collectively referred to as “Employee Claims”) which
Employee ever had, claims to have, now has, or in the future may have, connected
with those contractual obligations arising under or related to Employees
employment. This release shall also include, but not be limited to, any Employee
Claims arising under (1) Title VII of the Civil Rights Act of 1964, as amended;
(2) the Civil Rights Act of 1866 and the Civil Rights Act of 1991; (3) the
American With Disabilities Act; (4) the U.S. Age Discrimination in Employment
Act; (5) Older Workers’ Benefit protection Act; (6) The Employee Retirement
Income Security Act of 1974; (7) the California Fair Employment and Housing
Act;
and (8) contract, tort, personal injury or any other federal or state
statutory or common law action for wrongful discharge.
B.
General
Release of Employee.
IHHI and
any and all of their officers, agents, employees, subsidiaries, shareholders,
representatives, administrators, successors-in-interests, all of those acting
on
their behalf and their respective successors, assigns and executors, and each
of
them, hereby irrevocably, finally and fully release, forgive and discharge
Employee, his agents, representatives, successors-in-interests, all those acting
on their behalf and their respective successors, assigns and executors, and
each
of them, from any and all claims, demands, causes of action, obligations,
set-offs, liability, losses, injuries and damages of any kind or nature
whatsoever, whether known or unknown, suspected or unsuspected, foreseen or
unforeseen, liquidated or unliquidated, apparent or concealed (collectively
referred to as “IHHI Claims”) which IHHI ever had, claims to have, now has, or
in the future may have, connected with those contractual obligations arising
under or related to Employees employment.
C.
Prohibition
of Other Claims.
The
Parties represent that they have not filed and will not file at any time in
the
future any statutory, civil, or administrative claim, complaint, action, charge
or proceeding of any kind whatsoever with any state or federal court,
administrative agency or tribunal, or will not file any action for arbitration
arising out of or referring to any IHHI Claim or Employee Claim. All Parties
agree that this Release and the considerations exchanged in this Release are
contingent upon this promise not to file any such claim, complaint, demand
for
arbitration or charge.
D.
Complete
Settlement of Claims. This
Release is a compromise of the above-mentioned claims and shall never be treated
as an admission of liability be either Party for any purpose. This compromise
settlement, notwithstanding Section 1542 of the California Code of Civil
Procedure, which provides that:
“A
general release does not extend to claims which the creditor does not know
or
suspect to exist in his favor at the time of executing the release which if
known by him must have materially affected his settlement with the
debtor...”
Notwithstanding
the provisions of the California Civil Code Section 1542, both Parties
acknowledge that this Release is also intended to include in its effect, without
limitation, all claims which they do not know or expect to exist in their favor
at the time of executing this Release. The Parties understand and acknowledge
the significance and consequences of such specific waiver of Section 1542 and
hereby assume full responsibility for any injury, damage, losses or liability
that they may hereafter incur from the above-specified claims.
5. Warranties.
As a
condition of this Release, each of the Parties represents and warrants that
there has been no actual or purported assignment or other transfer of any claim
or other matter, or any interest therein, which has been released by the Parties
in this Release. Further, each of the Parties represents and warrants that
it is
the sole owner and party-in-interests regarding its respective claims and other
matters being released in this Release. If any representation or warranty made
by one of the Parties in this Release is false or incorrect, it is agreed that
the Party making such representation or warranty shall indemnify and hold
harmless the other Party and any and all of its officers, agents, employees,
representatives, shareholders, successors-in-interests, all of those acting
on
its behalf, and their respective successors, and each of them from any and
all
claims, demands, causes of action, obligations, set-offs, liabilities, damages,
losses, injuries, costs, expenses and attorney fees incurred by them, as a
result of any such false or incorrect representation or warranty.
6. Non-Disclosure
of Confidential Information and Non-Solicitation.
Employee
understands and agrees that while employed by Company he occupied a position
of
trust and confidence and, as a result, had access to Company’s confidential
information (Confidential Information). For the purpose of this Agreement,
Confidential Information shall mean confidential and proprietary information
about Company or its subsidiaries or affiliates that is not generally known
to
the public or the competitors of Company, including but not limited to the
following examples:
A.
Company information regarding its general business operations, including its
(i) marketing, development, financial and sales data strategies,
(ii) information concerning any of its customers, suppliers, employees or
agents, (iii) any business, marketing or sales reports, plans, or similar
analysis, (iv) pricing or other financial information, (v) methods of
operating any of its businesses, (vi) volumes of business and profit
margins, (vii) technical, technological and production know-how,
(viii) future plans, (ix) inventions, applications, designs, programs,
patents, and other processes or documentation, whether developed or in
development, (x) software programs, whether used or maintained by the
Company.
B.
Company information regarding its employees, including their (i) salaries,
commissions and other benefits, (ii) levels of knowledge, performance,
experience and expertise, (iii) strengths and weaknesses, and
(iv) special talents.
Employee
understands and agrees that such Confidential Information constitutes a valuable
competitive asset of Company and that it is and shall remain the exclusive
property of the Company and, to that end, covenants and agrees that he shall
never directly or indirectly make known, divulge, reveal, furnish, make
available, disclose, or use any Confidential Information unless any such
Confidential Information shall have become, through no fault of Employee,
generally known to the public.
Employee
understands and agrees that his obligations of confidentiality hereunder are
in
addition to, and not in limitation of or preemption of, all other obligations
of
confidentiality to Company under general legal or equitable
principles.
Employee
further agrees that, for one year following the execution of this Agreement,
he
covenants and agrees that he shall not in any capacity, on his own behalf,
or on
behalf of any other person, firm or entity, undertake or assist in the
solicitation of any then current customers or employees of Company to encourage,
invite, or induce the termination of his, her or its relationship, employment,
or other association with Company for the purpose of being employed by or using
the facilities or services of any competitor of Company.
7. Non-Disparagement.
The
Parties agree to refrain from taking actions or making any derogatory remarks
or
statements, whether orally or in writing, about either party, their management,
directors or business operations to any third party.
8. Agreement
to Cooperate.
The
Parties agree t respond to all reasonable inquiries of Company or Employee
about
any matters that occurred or arose during the period of Employees employment
with Company, and further agree to cooperate reasonably in investigating,
prosecuting and defending any charges, claims, demands, liabilities, causes
of
actions, lawsuits or other proceedings by, against or involving either Party
relating to the period during which Employee was employed by
Company.
9. Dispute
Resolution.
It is
understood and agreed that any and all disputes, controversies or claims
regarding or arising out of this Agreement, Employees employment with the
Company or separation thereof, including fraud in the inducement of this
Agreement, or relating to the general validity or enforceability of any of
the
provisions of this Agreement, shall be submitted to final and binding
arbitration in Orange County, California under the auspices of Judicial
Arbitration and Mediation Services (JAMS). The decision of the arbitrator shall
be final and binding and shall be enforceable in any court of competent
jurisdiction. The Parties agree that in the event of dispute, they may jointly
appoint one arbitrator to arbitrate the matter and if within 15 days of the
notice of dispute therein, if the Parties are unable to mutually appoint an
arbitrator, than JAMS administrator will automatically appoint an arbitrator
familiar with the area of law applicable to the disputes therein. Each party
agrees to bear their own costs and fees incurred during arbitration. Any
arbitration award rendered may be entered as a judgment in any court having
jurisdiction thereof and shall be final and binding and
non-appealable.
10. Indemnification.
To the
extent permitted by law, Company shall defend, indemnify and hold Employee
harmless from and against any and all losses, liabilities, damages, expenses
(including attorneys’ fees and costs), actions, causes of action or proceedings
arising directly or indirectly from Employees performance of this Agreement
or
services as an employee of Company, except claims arising from Employees
intentional misconduct or gross negligence. The Company shall control the
defense of such claim(s). This indemnification shall be in addition to any
right
of indemnification to which Employee may be entitled under Company’s Articles of
Incorporation and By-laws. With the prior approval of the Company, which may
be
withheld in the Company’s sole and absolute discretion, Employee may retain
personal counsel for defense in such actions, in which case Company shall pay
for the reasonable costs and expenses of such counts.
11. Notices.
Any
notice, demand, approval, consents, or other communication required or desired
to be given under this Agreement shall be in writing and directed to the party
involved at the address indicated below:
| Employee: | ▇▇▇▇▇ ▇▇▇▇▇ | ||
| ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ | |||
| ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ | |||
| Company: | Integrated Healthcare Holdings, Inc. | ||
| ▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||
| ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ |
12. Miscellaneous.
A.
Successors
and Assigns.
This
Release shall inure to the benefit of and shall be binding upon the successors
and assigns of the Parties to this Release.
B.
Advice
of Counsel.
Each of
the Parties acknowledge their rights to seek and obtain counsel with regards
to
this Release, and each of the Parties has read this Release and is fully aware
of and understands its contents.
C.
Revocation/Cancellation.
Employee shall have twenty-one (21) days to determine whether to sign this
Release and be bound by its terms; however, Employee may sign this Release
prior
to the expiration of the 21-day period. Employee shall have the right to revoke
or cancel this Release within seven (7) days after execution hereof. Any
cancellation or revocation may be accomplished by delivery of a written notice
to:
Integrated
Healthcare Holdings, Inc.
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇▇ ▇▇▇▇▇, Chief Executive Officer
If
this
Release is canceled or revoked by Employee, IHHI has no obligation to pay
Severance Benefits described in paragraph 2 hereof.
D.
Entire
Agreement.
Except
as otherwise provided herein, this Release constitutes the final, complete
and
exclusive settlement agreement between the Parties with respect to Employees
employment and this Release supersedes any prior or contemporaneous written
or
oral agreement between the Parties. Further, there are no representations,
warranties, agreements, arrangements or understandings, oral or written, between
the Parties relating to the subject matter of this Release, other than those
expressed herein.
E.
Signed
in Counterpart.
This
Release may be executed in any number of original counterparts. Any such
counterpart, when executed, shall constitute an original of this Release, and
all such counterparts taken together shall constitute one and the same
agreement. However, this Release will not be deemed effective until each Party
has executed at lease one original counterpart of this Release.
F.
Modification
and Amendment.
No
waiver, modification or amendment of any term, condition or provision of this
Release shall be valid or have any force or effect unless made in writing and
signed by both Parties.
G.
Governing
Law.
This
Release shall be governed by, and interpreted in accordance with, the internal
laws of the state of California. In the event of a dispute hereunder, this
Release shall be interpreted in according with its fair meaning and shall not
be
interpreted for or against either Party hereto on the ground that such Party
drafted or caused to be drafted this Release or any part hereof.
H.
Confidentiality.
Without
the prior written consent, IHHI or Employee shall not disclose, discuss or
reveal to any persons, entities or organizations whether within or outside
the
organization of IHHI or Employee the terms and conditions of this Release except
to Parties legal counsel, tax advisor, or as required by applicable law. Both
Parties covenant that any and all actions by the Parties in accordance with
this
Release are strictly confidential and shall be governed by the confidentiality
obligations set forth herein.
I.
Attorneys’
Fees.
In the
event that any action is commenced by one of the Parties or other person to
seek
enforcement of this Release or declare rights hereunder, the prevailing party
in
such action shall be entitled to its reasonable attorneys’ fees and costs
incurred in connection with that action, either in the trial court or on
appeal.
IN
WITNESS WHEREOF,
the
Parties have executed this Release as of the Effective Date indicated
hereinabove.
| Employee: | Integrated Healthcare Holdings, Inc.: | ||
| /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ | /s/ ▇▇▇▇ ▇▇▇▇ | ||
|
|
|
||
|
▇▇▇▇▇
▇. ▇▇▇▇▇
|
▇▇▇▇
▇▇▇▇, M.D., Chairman
|
| /s/ ▇▇▇▇▇ ▇▇▇▇▇ | |||
|
|
|||
| ▇▇▇▇▇ ▇▇▇▇▇, Chief Executive Officer |
WAIVER
OF THE RIGHT TO CANCEL AND OR REVOKE
EMPLOYMENT
SEVERANCE AGREEMENT AND
GENERAL
RELEASE OF CLAIMS
THIS
WAIVER OF THE RIGHT TO CANCEL AND OR REVOKE EMPLOYMENT SEVERANCE AGREEMENT
AND
GENERAL RELEASE OF CLAIMS
(the
“Waiver”)
is
entered into as of January 20, 2006 by and between Integrated Healthcare
Holdings, Inc., (“IHHI”)
a Nevada
corporation and ▇▇▇▇▇ ▇. ▇▇▇▇▇ (“Employee”),
an
individual. IHHI
and
Employee
are
sometimes referred to herein collectively as the “Parties”
or
individually as a “Party”
Pursuant
to paragraph 12(C) of the employment severance agreement and general release
of
all claims, the employee hereby agrees to waive the seven (7) day waiting period
to revoke or cancel the employment severance agreement and general
release.
Notwithstanding
the above, all the other terms and conditions of the employment severance
agreement and general release shall remain in full force and
effect.
IN
WITNESS WHEREOF,
the
Parties have executed this waiver as of the Effective Date indicated
hereinabove.
| Employee: | Integrated Healthcare Holdings, Inc.: | ||
| /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ | /s/ ▇▇▇▇ ▇▇▇▇ | ||
|
|
|
||
|
▇▇▇▇▇
▇. ▇▇▇▇▇
|
▇▇▇▇
▇▇▇▇, M.D., Chairman
|
| /s/ ▇▇▇▇▇ ▇▇▇▇▇ | |||
|
|
|||
| ▇▇▇▇▇ ▇▇▇▇▇, Chief Executive Officer |