1
EXHIBIT 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into as of January 15, 1998, by and
between RENAL CARE GROUP, INC., a Delaware corporation (the "Company"), and Xxx
X. Xxxxxx, Xx. (hereinafter "Employee"), and supersedes and replaces that
certain Employment Agreement between the parties hereto dated as of February 6,
1996.
WITNESSETH:
WHEREAS, the Company desires to employ Employee, and Employee desires
to be employed by the Company, on the terms and conditions contained herein;
and
NOW, THEREFORE, in consideration of the compensation payable to
Employee by the Company pursuant to this Agreement, and the mutual promises,
covenants, representations and warranties contained herein, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto do agree as
follows:
1. Employment.
Effective as of January 15, 1998 (the "Effective Date"), the
Company employs Employee and Employee accepts employment with the Company under
the terms of this Agreement.
2. Term.
This Agreement shall begin on the Effective Date, and shall
continue for an initial period of thirty-six (36) months from the Effective Date
(the "Initial Period"), subject to earlier termination by Employee or the
Company as hereinafter provided. This Agreement shall renew for additional
terms of twelve (12) months each, subject to earlier termination as hereinafter
provided, on the same terms and conditions (subject to mutually agreeable
modifications, if any).
3. Compensation and Benefits.
(a) Base Compensation: The Company shall pay Employee an
annual salary of Three Hundred Thousand Dollars ($300,000), as may be adjusted
as provided herein (the "Base Compensation"), payable according to the pay
periods of the Company as may be in effect from time to time. Such payments
shall be prorated for periods less than a full pay period. The Base
Compensation shall be subject to withholding for federal, state and local
payroll and all other taxes or withholdings applicable to Employee. Any
increases of the Base Compensation shall be at the discretion of the Company,
provided that any decreases to the then current Base Compensation shall require
the consent of Employee.
(b) Benefits: During the term of this Agreement, Employee
shall also be entitled to participate in the insurance and other fringe benefits
made available generally to similar employees of the Company, as such benefits
may be determined from time to time by the Company, provided that Employee shall
have at least four (4) weeks of paid vacation time. In addition, during the
term of this Agreement, the Company will provide term life insurance coverage of
three Million Dollars ($3,000,000) on Employee's life with the death benefit to
be payable to Employee's estate or as otherwise directed in writing by Employee.
2
(c) Bonuses: In addition to the Base Compensation
payable to Employee pursuant to Section 3(a) above, the Employee is entitled to
an annual bonus equal to seventy-five percent (75%) of the Employee's annual
Base Compensation payable within sixty (60) days of the end of each fiscal year
of the Company based on whether the Company met or exceeded the earnings per
share projection specified by the Compensation Committee of the Board of
Directors of the Company for such fiscal year, or based upon such other
criteria as may be specified by the Compensation Committee of the Board of
Directors (the "Annual Bonus").
(d) Expenses: The Company shall reimburse Employee for
any and all expenses reasonably incurred by employee incident to the
performance of the duties imposed upon Employee hereunder.
4. Duties, Extent of Services:
Employee is engaged as President and Chief Executive Officer
and shall perform such duties and responsibilities as are typically incident
thereto, and shall perform in a faithful and competent manner such additional
duties as may be reasonably assigned from time to time by the Company. Such
duties shall be performed on a full-time basis for the Company at the Company's
offices in Nashville, Tennessee. Employee may be required, from time to time,
to perform his duties temporarily hereunder at such other place or places as the
Company shall reasonably require, provided that such period does not exceed
thirty (30) consecutive days without Employee's consent and that during any such
period Employee is able to return to Nashville, Tennessee at the Company's
expense for weekends.
Employee shall devote all of Employee's business time,
attention, knowledge, and skill solely to the business and interest of the
Company, and the Company shall be entitled to all the benefits, profits, and
other issues arising from, or incident to, all work, services, and advice of
Employee provided, however, that the Company agrees and acknowledges that
Employee may continue to serve as a member of the board of directors of other
companies, including serving as Chairman of National Imaging Affiliates, Inc.,
and may continue to devote a reasonable amount of time to such services, without
violating the terms of this Agreement.
5. Termination.
This Agreement may be terminated by the parties in the manners
specified below:
(a) Termination without Cause. Either the Company or the
Employee may terminate Employee's employment under this Agreement at any time
for any reason upon thirty (30) day's prior written notice to the other party.
(b) Termination for Cause
The Company may terminate this Agreement on written
notice at any time for "cause". For purposes of this Agreement, "cause" shall
mean: (i) Employee is convicted of, pleads guilty to, or confesses to a felony
or any crime involving any act of dishonesty, fraud, misappropriation,
embezzlement or moral turpitude, in which event the Company may terminate this
Agreement immediately, (ii) the misconduct or gross negligence by Employee in
connection with the performance of Employee's duties hereunder, (iii) the
engaging by Employee in any fraudulent, disloyal or unprofessional conduct
which results in an injury to the Company, its affiliates or any of its or
their centers, monetarily or otherwise, (iv) Employee breaches any provisions of
Section 6 of this Agreement, or (v) the failure by Employee to otherwise
substantially perform his duties with the Company (other than any such failure
resulting from the disability of Employee under Section 5(c)(i)) or the breach
of any provision of this Agreement other than Section 6. In the event of any
termination for cause pursuant to the provisions of (ii), (iii), (iv) or (v) of
this subsection, the Company shall give Employee written notice prior to such
termination detailing the specific acts, actions, failures, or events upon
which the forecast termination is based, and Employee shall have fifteen (15)
days after such written notice to
- 2 -
3
cease such actions or otherwise correct any such failure or breach. If
Employee does not cease such action or otherwise correct such failure or breach
within such fifteen day time period, or having once received such written
notice and ceased such actions or corrected such failure or breach, Employee at
any time thereafter again so acts, fails or breaches, the Company may terminate
this Agreement immediately.
(c) Involuntary Termination.
The employment of Employee hereunder shall be
automatically terminated by the death or disability of Employee as outlined
below.
(i) Disability. The Company may terminate this
Agreement at the time Employee shall have been Disabled for a continuous period
of six (6) months during any continuous twelve month period. For purposes of
this Paragraph 5(c)(i), the term "Disabled" shall mean Employee's inability to
perform the essential functions of his duties, with or without reasonable
accommodation. During Employee's six month period of Disability, the Company
agrees to continue to pay Employee's Base Compensation (less regular
withholdings for payroll or other taxes and other required or proper items, and
less proceeds from all disability insurance policies or plans provided or made
available by the Company). In the event of a termination of Employee on
account of Disability, the Company shall be obligated to pay Employee's Base
Compensation for a period of six months following the effective date of
termination (less regular withholdings for payroll or other taxes and other
required or proper times, and less proceeds from all disability insurance
policies or plans provided or made available by the Company). In addition, any
provisions in the relevant stock option agreements notwithstanding, all
outstanding stock options granted to Employee pursuant to a Company stock
option plan shall vest immediately upon termination pursuant to this Section
5(c)(i).
(ii) Death. In the event Employee shall die
during the term of this Agreement, this Agreement shall terminate and
Employee's estate shall receive the remainder of the Base Compensation set
forth in Section 3(a) hereof accrued to the last day of the month in which
death occurs. In addition, any provisions in the relevant stock option
agreements notwithstanding, all outstanding stock options granted to Employee
pursuant to a Company stock option plan shall vest immediately upon termination
pursuant to this Section 5(c)(ii).
(d) Post-Termination Compensation. Except as provided in
Section 5(c) above, upon termination of this Agreement, Employer shall be
relieved of all of its obligations hereunder notwithstanding any period of time
remaining under the initial or any renewal term, subject to the following:
(i) Termination without Cause. In the event that the
Company terminates Employee's employment hereunder without Cause under Section
5(a) above, then Employee shall, after the effective date of such termination,
as Employee's sole and exclusive remedy, receive an amount equal to the annual
Base Compensation (as then in effect) plus an amount of Annual Bonus for the
current year (the amount of Annual Bonus for the current year shall be equal in
amount to any Annual Bonus paid or to be paid to Employee in connection with the
Company's last completed fiscal year), payable without interest in equal amounts
according to the pay periods of the Company for a period of twelve (12) months
after the termination date. If the Employee's employment is terminated by the
Company without Cause, the Employee shall be under no duty to seek or accept
other employment; but if he shall do so, any compensation he shall receive
therefrom shall not diminish the Company's obligation to make payments required
to the Employee hereunder In the event that Employee terminates his or her
employment under Section 5(a) above, the Company's obligation to pay Employee's
Base Compensation shall terminate as of the date of termination.
- 3 -
4
(ii) Termination for Cause. In the event that the
Company terminates Employee's employment hereunder with Cause under Section
5(b) above, then Employee shall, after the effective date of such termination,
receive the Base Compensation (as then in effect) for a period of one (1) month
after the termination date.
(iii) Termination following Change in Control. If
within twelve (12) months following a Change in Control (as defined below),
either (A) the Company terminates the employment of Employee hereunder without
Cause under Section 5(a) above or (B) Employee resigns from a declined
reassignment of a job that is not reasonably equivalent in responsibility or
compensation or that is not in the same geographic area, then, in lieu of any
other compensation that may be specified herein, Employee shall receive an
amount equal to three (3) multiplied by the sum of the Annual Base Compensation
(as then in effect) plus an amount of Annual Bonus for the current year (the
amount of Annual Bonus for the current year shall be equal in amount to any
Annual Bonus paid or to be paid to Employee in connection with the Company's
last completed fiscal year), payable by the Company in a single lump-sum
payment, to be paid not later than thirty (30) days after termination. In the
event such payment obligation arises, no compensation received from other
employment (or otherwise) shall reduce the obligation to make the payment(s)
described in this paragraph.
(e) Change in Control. "Change in Control" means a
change in control of the Company of a nature that would be required to be
reported (assuming such event has not been "previously reported") in response
to Item 1(a) of a Current Report on Form 8-K pursuant to Section 13 or 15(d) of
the Exchange Act of 0000 (xxx "Xxxxxxxx Xxx"); provided that, without
limitation, a Change in Control shall also be deemed to have occurred at such
time as:
(i) any "person" within the meaning of Section
14(d) of the Exchange Act, other than the Company; a subsidiary, or any
employee benefit plan(s) sponsored by the Company or any Subsidiary, is or has
become the "beneficial owner," as defined in rule 13d-3 under the Exchange Act,
directly or indirectly, of 25% or more of the combined voting power of the
outstanding securities of the Company ordinarily having the right to vote at
the election of directors, or
(ii) individuals who constitute the Board
immediately prior to any meeting of stockholders (the "Incumbent Board") have
ceased for any reason to constitute at least a majority thereof, provided that
any person becoming a director whose election, or nomination for election by
the Company's stockholders, was approved by a vote of at least three-quarters
(3/4) of the directors comprising the Incumbent Board (either by a specific
vote or by approval of the proxy statement of the Company in which such person
is named as a nominee for director without objection to such nomination) shall
be, for purposes of this Agreement, considered as though such person were a
member of the Incumbent Board; or
(iii) upon approval by the Company's stockholders
of a reorganization, merger, share exchange or consolidation, other than one
with respect to which those persons who were the beneficial owners, immediately
prior to such reorganization, merger, share exchange or consolidation, or
outstanding securities of the Company ordinarily having the right to vote in
the election of directors own, immediately after such transaction, more than
75% of the outstanding securities of the resulting corporation ordinarily
having the right to vote in the election of directors; or
(iv) upon approval by the Company's stockholders
of a complete liquidation and dissolution of the Company or the sale or other
disposition of all or substantially all of the assets of the Company other than
to a Subsidiary.
- 4 -
5
6. Nondisclosure, Confidentiality; Competition.
(a) Subject to Section 6(f) below, Employee agrees that,
during the term of this Agreement and of Employee's employment by the Company,
and for a period twelve (12) months after the termination of Employee's
employment with the Company, Employee will not in any manner, directly or
indirectly, by himself or in conjunction with any other person, (i) conduct any
of the activities or perform any of the responsibilities or duties that
Employee provided the Company during his employment by the Company for any
business entity that is competitive with the business of the Company or its
affiliates or (ii) establish or own any financial, beneficial or other interest
in (other than an interest consisting of less than one percent (1%) of a class
of publicly traded security), make any loan to or for the benefit of, or render
any managerial, marketing or other business advice, to any entity that is then
conducting activities that are competitive with those of the business of the
Company or its affiliates, in either case within a geographic territory defined
as the greater of (i) a seventy-five (75) mile radius of any renal dialysis
center, unit or facility owned or operated by the Company or an affiliate of
the Company (an "RCG Center"), or (ii) the geographic area, as narrowly
construed as is practicable, from which the Company received patients at each
of the RCG Centers. For purposes of this Section, the "business of the Company
or its affiliates" shall mean owning or operating a renal dialysis center, unit
or facility, and providing practice management services to nephrologists.
(b) Subject to Section 6(f) below, Employee further
agrees that, for a period of three (3) years after the termination of
Employee's employment with the Company, Employee will keep confidential and not
directly divulge, or allow through a lack of reasonable care to be divulged to
anyone, or use or otherwise appropriate for Employee's own benefit or for the
benefit of others, any knowledge or information of a confidential nature with
respect to the Company's and its affiliates' current business, the Company
itself, or any of its affiliates, including all trade secrets, pricing
information, marketing information or technical information (hereinafter
referred to as the "Confidential Data"), except for (i) a disclosure that is
required by law; or (ii) information that has been made generally available to
the public by the act of one who has the right to disclose such information.
Employee hereby acknowledges and agrees that the prohibitions against
disclosure of Confidential Data recited herein are in addition to, and not in
lieu of, any rights or remedies which the Company may have available pursuant
to the laws of any jurisdiction or at common law to prevent the disclosure of
confidential information, and the enforcement by the Company of its rights and
remedies pursuant hereto shall not be construed as a waiver of any other rights
or available remedies which the Company may possess in law or equity. Employee
acknowledges that the Company has taken reasonable and appropriate steps to
ensure the confidentiality and non-disclosure of all such Confidential Data.
For purposes of this Section the Company's and its affiliates' "current
business" shall mean owning or opening a renal dialysis center, unit or
facility.
(c) Subject to Section 6(f) below, Employee further
agrees that, for a period of three (3) years after the termination of
Employee's employment with the Company, Employee will not, for his own benefit
or the benefit of others, solicit any person or entity that has or has had, or
disrupt or attempt to disrupt, any relationship, contractual or otherwise, with
the Company or an affiliate of the Company (including any patient, payor,
physician, provider, managed care organization or supplier) at any time during
Employee's employment with the Company, for the purpose of assisting, or
creating such a relationship for, any business entity that is competitive with
the Company or an affiliate of the Company. For purposes of this Section, a
business entity is competitive with the Company or an affiliate of the
- 5 -
6
Company if it provides or offers any renal dialysis service that is provided by
the Company or an affiliate of the Company.
(d) Subject to Section 6(f) below, Employee further
agrees that, for a period of three (3) years after the termination of
Employee's employment with the Company, Employee shall not induce, nor attempt
to induce, any employee of the Company, or any of its affiliates, to terminate
such employee's association with the Company or any of its affiliates.
(e) These post-employment covenants are considered by the
parties hereto to be fair, reasonable and integral for the protection of the
Company. The parties mutually agree that if a violation of any of these
covenants occurs, such violation or any threatened violation will cause
irreparable injury to the Company and the remedy at law for any such violation
or threatened violation will be inadequate. The parties acknowledge that these
covenants will survive, and remain in effect and enforceable after, termination
of this Agreement.
(f) The Company agrees that the forgoing covenants in
paragraphs 6(a) through (d) shall be null and void as to any period following
termination of employment in the event such termination occurs within twelve
(12) months following a Change in Control through either (A) a termination by
the Company without Cause under Section 5(a) above or (B) a resignation by
Employee for any reason.
(g) Employee agrees to indemnify and hold harmless the
Company from and against any and all claims, causes of action, damages and/or
any other losses suffered or incurred by the Company as a result of any breach
or purported breach by Employee of any agreement applicable to Employee which
existed prior to the time of the entering into of this Agreement. Such
obligations of Employee to indemnify and hold the Company harmless shall
include any and all costs of defense of any such claim or threatened claim,
including reasonable attorneys' fees.
7. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the event it shall be
determined that any payment or distribution by the Company to or for the
benefit of Employee (whether paid or payable or distributed or distributable
pursuant to the terms of this Agreement or otherwise, but determined without
regard to any additional payments required under this Section 7) (a "Payment")
would be subject to the excise tax imposed by Section 4999 of the Code or any
interest or penalties are incurred by Employee with respect to such excise tax
(such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"), then Employee shall
be entitled to receive an additional payment (a "Gross-Up Payment") in an
amount such that after payment by Employee of all taxes (including any interest
or penalties imposed with respect to such taxes), including, without
limitation, any income taxes (and any interest and penalties imposed with
respect thereto) and Excise Tax imposed upon the Gross-Up Payment, Employee
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Payments.
(b) Subject to the provisions of Section 7(c), all
determinations required to be made under this Section 7, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be made
by Ernst & Young LLP or such other certified public accounting firm as may be
designated by Employee (the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and Employee within 15 business
days of the receipt of notice from Employee that there has
- 6 -
7
been a Payment, or such earlier time as is requested by the Company. In the
event that the Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change in Control, Employee shall
appoint another nationally recognized accounting firm to make the
determinations required hereunder (which accounting firm shall then be referred
to as the Accounting Firm hereunder). All fees and expenses of the Accounting
Firm shall be borne solely by the Company. Any Gross-Up Payment, as determined
pursuant to this Section 7, shall be paid by the Company to Employee within
five days of the receipt of the Accounting Firm's determination. Any
determination by the Accounting Firm shall be binding upon the Company and
Employee. It is possible (due to the uncertainty in the application of Section
4999 of the Code at the time of the initial determination by the Accounting
Firm hereunder) that Gross-Up Payments will not have been made by the Company
which it is ultimately determined should have been made ("Underpayment"),
consistent with the calculations required to be made hereunder. Consequently,
in the event that the Company exhausts its remedies pursuant to Section 7(c)
and Employee thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly paid by the Company to or
for the benefit of Employee.
(c) Employee shall notify the Company in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Gross-Up Payment. Such notification shall be
given as soon as practicable but no later than ten business days after Employee
is informed in writing of such claim and shall apprise the Company of the
nature of such claim and the date on which such claim is requested to be paid.
Employee shall not pay such claim prior to the expiration of the 30-day period
following the date on which it gives such notice to the Company (or such
shorter period ending on the date that any payment of taxes with respect to
such claim is due). If the Company notifies Employee in writing prior to the
expiration of such period that it desires to contest such claim, Employee
shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with contesting
such claim as the Company shall reasonably request in writing from time to
time, including, without limitation, accepting legal representation with
respect to such claim by an attorney reasonably selected by the Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claim;
provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold Employee harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses. Without limitation of the foregoing provisions
of this Section 7(c), the Company shall control all
- 7 -
8
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct Employee to pay the tax claimed and xxx for a refund
or contest the claim in any permissible manner, and Employee agrees to
prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company directs
Employee to pay such claim and xxx for a refund, the Company shall advance the
amount of such payment to Employee, on an interest-free basis and shall
indemnify and hold Employee harmless, on an after-tax basis, from any Excise
Tax or income tax (including interest or penalties with respect thereto)
imposed with respect to such advance or with respect to any imputed income with
respect to such advance; and further provided that any extension of the statute
of limitations relating to payment of taxes for the taxable year of Employee
with respect to which such contested amount is claimed to be due is limited
solely to such contested amount. Furthermore, the Company's control of the
contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and Employee shall be entitled to settle or contest,
as the case may be, any other issue raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by Employee of an amount
advanced by the Company pursuant to Section 7(c), Employee becomes entitled to
receive any refund with respect to such claim, Employee shall (subject to the
Company's complying with the requirements of Section 7(c)) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by Employee of
an amount advanced by the Company pursuant to Section 7(c), a determination is
made that Employee shall not be entitled to any refund with respect to such
claim and the Company does not notify Employee in writing of its intent to
contest such denial of refund prior to the expiration of 30 days after such
determination, then such advance shall be forgiven and shall not be required to
be repaid and the amount of such advance shall offset, to the extent thereof,
the amount of Gross-Up Payment required to be paid.
8. Severability.
The parties hereto hereby expressly agree and contract that it
is not the intention of either party to violate any public policy, or any
statutory or common law, and that if any paragraph, sentence, clause or
combination of the same of this Agreement shall be in violation of the laws of
any state where applicable, such paragraph, sentence, clause or the combination
of the same shall be void in the jurisdictions where it is unlawful, and the
remainder thereof shall remain binding on the parties hereto. It is the
intention of the parties to make the covenants of this Agreement binding only
to the extent that they may be lawfully done under existing applicable laws.
In the event that any part of any term or covenant of this Agreement is
determined by a court of law or equity to be overly broad or otherwise
unenforceable, the parties hereto agree that such court shall be empowered to
substitute, and it is the intent of the parties hereto that such court
substitute, a reasonably judicially enforceable term or limitation in the place
of such unenforceable term or covenant, and that as so modified this Agreement
shall be fully enforceable.
9. Entire Agreement; Modification.
This Agreement constitutes the entire agreement between the
parties and supersedes any and all prior understandings or agreements, and any
changes or additions hereto must be in writing and signed by both parties.
- 8 -
9
10. Assignment.
(a) The rights and benefits of Employee under this
Agreement, other than accrued and unpaid amounts due under Section 3(a) hereof,
are personal to Employee and shall not be assignable.
(b) This Agreement may not be assigned by the Company
except to an affiliate of the Company, provided that such affiliate assumes the
Company's obligations under this Agreement; provided, further, that if the
Company shall merge or effect a consolidation or share exchange with or into,
or sell or otherwise transfer substantially all its assets to, another business
entity, the Company may assign its rights hereunder to that business entity
without the consent of the Employee provided that it causes such business
entity to assume the Company's obligations under this Agreement.
11. Notice.
The references to the notice periods of certain "days"
contained in this Agreement shall mean calendar days. Any notice provided for
in this Agreement shall be delivered to Employee at the most recent address of
employee listed in the Company's then current employment records. Notice to
the Company shall be delivered to the following address: c/o Renal Care Group,
Inc., 0000 Xxxx Xxx Xxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxxx 00000, Attention:
President.
12. Waiver.
The waiver by any party to this Agreement of a breach of any
of the provisions contained herein shall not operate or be construed as a
waiver of any subsequent breach.
13. Disputes and Governing Law.
The Company and employee agree that any dispute arising in
connection with, or relating to, this Agreement or the termination of this
Agreement, to the maximum extent allowed by applicable law, shall be subject to
resolution through informal methods and, failing such efforts, through
arbitration. Either party may notify the other party of the existence of a
dispute by written notice to the address indicated above in Section 11. The
parties shall thereafter attempt in good faith to resolve their differences
within thirty (30) days after the receipt of such notice. If the dispute
cannot be resolved within such 30-day period, either party may file a written
demand for arbitration with the other party. The arbitration shall proceed in
accordance with the terms of the Federal Arbitration Act and the rules and
procedures of the American Arbitration Association. A single arbitrator shall
be appointed through the American Arbitration Association's procedures to
resolve the dispute.
The parties agree that in the event arbitration is necessary,
the laws of the State of Tennessee and any applicable federal law shall apply.
The place of the arbitration shall be Nashville, Tennessee.
The award of the arbitrator shall be binding and conclusive
upon the parties. Either party shall have the right to have the award made the
judgment of a court of competent jurisdiction in the State of Tennessee.
In the event of a dispute arising under this Agreement, the
prevailing party shall be entitled to all reasonable attorneys' fees incurred
in connection with such dispute. The Company agrees, to the maximum extent
permitted by law and the Bylaws and Certificate of Incorporation of the
- 9 -
10
Company, to defend and indemnify the Employee against and to hold the Employee
harmless from any and all claims, suits, losses, liabilities, and expenses
(including disputes arising under this Agreement and including reasonable
attorneys' fees and payment of reasonable expenses incurred in defending
against such claim or suit as such expenses are incurred) asserted against the
Employee for actions taken or omitted to be taken by the Employee in good faith
and within the scope of his responsibilities as an officer or employee of the
Company. If requested by the Employee, the Company shall advance to the
Employee, promptly following the Company's receipt of any such request, any and
all expenses for which indemnification is available hereunder, subject to the
requirements of applicable law and the Company's Bylaws and Certificate of
Incorporation.
IN WITNESS WHEREOF, the Company and Employee have executed
this Agreement on the day and year first above written.
COMPANY:
RENAL CARE GROUP, INC.
By: /s/ XXXXXX XXXXX
-----------------------------------------------
Xxxxxx Xxxxx
Chief Financial Officer
[Corporate Seal]
EMPLOYEE:
/s/ XXX X. XXXXXX, XX. (Seal)
---------------------------------------------
Xxx X. Xxxxxx, Xx.
- 10 -
