AMENDMENT TO EMPLOYMENT AGREEMENT
THIS AMENDMENT TO EMPLOYMENT AGREEMENT (the "Amendment"), is dated to be
effective as of September 13, 2000, and amends that certain Employment Agreement
by and between Xxxxxxx X. Xxxxxxx ("Employee") and U.S. Cancer Care, Inc.
("Corporation") ("Agreement") dated May 22, 1998.
AGREEMENT
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1. Section 3.1 of the Agreement is hereby deleted and replaced with the
following:
3.1 POSITION AND DUTIES. The Employee shall serve as Vice Chairman of the
Corporation until the Corporation's current Chief Executive Officer,
Xxxxx Xxxxx, resigns from that position. Upon Xx. Xxxxx'x resignation
as Chief Executive Officer of the Corporation, the Employee shall be
appointed Chief Executive Officer of the Corporation. The Employee
shall serve as Chief Executive Officer subject to the control and
direction of the Board of Directors of the Corporation with duties and
responsibilities that are customary for such offices, including, but
not limited to, management and oversight of the President, Chief
Operating Officer, Chief Financial Officer, Chief Information Officer,
Chief Development Officer and Senior Controllers. The Employee shall
have such other powers and duties as may be assigned to him from time
to time by the Board of Directors of the Corporation. The Corporation
agrees that a change in Position and Duties constitutes an immediate
constructive termination and entitle the employee to severance under
Section 4.6.
2. Section 4.1 of the Agreement is hereby deleted and replaced with the
following:
4.1 TERM. The term (the "Term") of this Agreement shall commence on the
date first above written and shall terminate on May 22, 2005.
3. The first sentence of Section 4.2 of the Agreement is hereby deleted and
replaced with the following:
"The Corporation may terminate this Agreement at any time and for any
reason. If, however, the termination is not for cause as specified in this
Section 4.2, or for death or disability of the Employee as set forth in
Section 4.4, then the Corporation shall pay to the Employee the severance
pay set forth in Section 4.6."
4. The last two sentences of Section 4.4 of the Agreement are hereby
deleted and replaced with the following:
"Upon termination of this Agreement by reason of the Employee's death or
Disability, the Corporation will pay the Employee or his legal
representative, as the case may be, the amount of one-sixth (1/6) of the
Employee's annual base
salary, plus one-sixth (1/6) of any bonuses paid or accrued to the Employee
within the previous twelve (12) months, as of the date of the Employee's
death or Disability."
5. Section 4.6 of the Agreement is hereby deleted and replaced with the
following:
4.6 TERMINATION BY EMPLOYER WITHOUT CAUSE.
(a) If this Agreement is terminated by the Corporation without cause as
specified in Section 4.2 or 4.3, then Corporation shall pay to the
Employee, as severance pay, the amount of one-sixth (1/6) of the Employee's
annual base salary as of the date of termination, plus one-sixth (1/6) of
any bonuses paid or accrued to the Employee within the previous twelve (12)
months. If the Corporation defaults on any of the provisions of this
Agreement or Amendment, then Section 4.6 (a) shall be void, and the
original Section 4.6 shall apply for severance of 2.9 times the Employee's
base salary pursuant to the Employment Agreement dated May 22, 1998.
(b) The Corporation agrees that if the Employee is terminated in accordance
with either provisions 4.2, 4.4, or 4.6; then the Corporation will
immediately vest all of the Employee's Stock Options, and provide a
cashless exercise of the value of such option. In accordance with such
cashless exercise, the Corporation shall issue to the Employee shares of
common stock $0.01 par value of the Corporation equal to the difference
between the fair market value of the Corporation's shares and the exercise
price of the stock options. (Example: if the Corporation's common stock is
traded on the Nasdaq NMS at $5 per share, and the Employee's stock option
exercise price is $2 per share, then the Corporation will issue to the
Employee shares of common stock $0.01 par value equal to $3 ($5 minus $2)
multiplied by the number of Employee stock options.).
(c) The Corporation agrees that if the Employee is terminated in accordance
with either provisions 4.2, 4.4, or 4.6; then the Employee will immediately
receive additional compensation of: (i) any and all accrued vacation pay,
back wages accrued, and accrued sick pay; (ii) the Employee's Dell laptop
computer and all accessories; and (iii) the Corporation will pay for the
Employee's COBRA until employee becomes eligible for another employer's
health insurance or for six months, whichever occurs first.
6. Section 7.1 of the Agreement is hereby deleted and replaced with the
following:
7.1 SALARY. Effective as of the date of this agreement, the Corporation
shall pay the Employee an annual base salary of Two Hundred Fifty Thousand
Dollars ($250,000), which thereafter shall be increased at least annually
at a rate of no less than five percent (5%) per annum, with such additional
amounts being set in the discretion of the Board. Notwithstanding the
foregoing, however, until the Corporation has current positive cash flow
(as determined by the Corporation's
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Weekly Cash Flow Reports or Monthly Management Reports prepared by the
Corporation's accounting department for the Corporation's current
operations), Employee will be paid cash compensation of Two Hundred Ten
Thousand Dollars ($210,000) per year, with the balance of Forty Thousand
Dollars ($40,000) per year in base salary accruing as an unpaid liability
for wages owed by the Corporation to the Employee. The Corporation will pay
the Employee his annual salary in equal installments no less frequently
than bi-monthly. The Corporation agrees that if the Employee is terminated
in accordance with either provisions 4.2, 4.4, or 4.6; then the Employee
will immediately receive all accrued wages to date.
7. Section 7.2 of the Agreement is hereby deleted and replaced with the
following:
7.2 BONUS.
(a) Employee shall be paid such bonuses as may, from time to time, be
determined in the sole discretion of the compensation committee of the
Corporation's Board of Directors.
(b) During the term of this Agreement, the Employee shall be paid a bonus
immediately upon the investment of common stock equity into the Corporation
by any investor of a minimum of $3 million. Such bonus shall be a range of
a minimum of $50,000 and a maximum of $100,000 on a pro rata basis of the
investment of a minimum of $3 million and a maximum of $5 million.
(example: If there is an investment of $3 million then the bonus is $
50,000; if there is an investment of $5 million the bonus is $100,000; if
there is an investment of $4 million, the bonus is $75,000, etc.)
8. The following new Section 12.8 is hereby added to the Agreement:
12.8 MOVING EXPENSES. The Corporation and Employee acknowledge and agree
that the Employee is being required to relocate to California from Florida.
In connection with such move, the Corporation agrees to pay the maximum
amount of Seventy Five Thousand Dollars ($75,000) of Employee's relocation
expenses. Employee agrees that the Corporation shall not be obligated to
reimburse any relocation expense of Employee unless and until Employee has
provided documentary evidence of such expenses. The Corporation agrees that
upon presentation of documentation of Moving Expenses, that the Employee
will be reimbursed in full within ten (10) days. For purposes of this
section, relocation expenses shall include: (i) all airfare; (ii) all
closing costs related to the sale of the Florida residence, including
broker commissions, title costs, tax stamps, document fees, and mortgage
prepayment penalties; (iii) moving and shipping costs for furniture and
autos (two vehicles); (iv) costs of advertising for the sale of the Florida
residence; (v) legal fees associated with the sale of the Florida
residence.
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9. Section # 4.5 shall be reciprocal. Thus Section 4.5 is stricken, and
replaced with the following: " The Employee or the Employer may terminate the
Employment Agreement without Cause by giving the other party at least sixty (60)
days prior written notice."
10. Section 10.1 Covenant, the term of Non-Competition Period shall be
reduced to two (2) months. If the Employee is terminated without cause, the
Employee shall not be subject to any Non-Competition Period.
11. In all other respects the parties acknowledge and affirm the terms of
the Agreement.
12. As additional consideration for entering into this Amendment, the
Corporation agrees to issue to Employee a five (5) year option to purchase one
hundred thousand shares (100,000) shares of the Corporation's common stock at an
exercise price of Two Dollars ($2.00) per share, and with other terms and
conditions, including vesting, as may be set forth in the Corporation's standard
incentive stock option agreement. Employee agrees that he will not be entitled
to such options unless and until he executes a stock option agreement as set
forth above.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment to be
effective as of the date first set forth above.
U.S. CANCER CARE, INC.,
A DELAWARE CORPORATION
By:/s/ Xxxxx Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
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XXXXX XXXXXXX, M.D. XXXXXXX X. XXXXXXX
CHAIRMAN OF THE BOARD
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