EXHIBIT 10.13
EMPLOYMENT AGREEMENT
THIS AGREEMENT, is made and entered into this 15th day of March 2002, by and
between Fresenius Medical Care North America ("FMC" or the "EMPLOYER"), with
principal offices located at 00 Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000 and Xxxxxx
"Xxxx" X. Xxxxxx, Xx. ("EMPLOYEE") currently residing at 00 Xxxxx Xxxxx Xxxx,
Xxxxx Xxxxxxx, XX 00000.
WITNESSETH:
WHEREAS, FMC desires to employ EMPLOYEE as Senior Vice President and President
of the Dialysis Products Division , and,
WHEREAS, the parties hereto desire to express the terms and conditions of such
employment.
NOW THEREFORE, it is understood and agreed to between the parties as follows:
1. EMPLOYMENT. FMC hereby employs EMPLOYEE as Senior Vice President and
President of Dialysis Products Division, and EMPLOYEE hereby accepts the
employment upon the terms and conditions of this Agreement.
2. TERM. The term of this Agreement shall commence as of March 15, 2002 and
continue thereafter, unless terminated in accordance with the provisions
hereinafter stated. THE INITIAL TERM SHALL BE RENEWED BY A SUCCESSIVE ONE
(1) YEAR PERIOD UNLESS EITHER PARTY GIVES WRITTEN NOTICE OF NON-RENEWAL TO
THE OTHER PARTY AT LEAST THIRTY (30) DAYS PRIOR TO ANY TERMINATION DATE.
THE INITIAL TERM AND ANY SUBSEQUENT RENEWAL PERIODS SHALL BE CALLED THE
"EMPLOYMENT TERM."
3. DUTIES AND RESPONSIBILITIES. EMPLOYEE shall serve full time as Senior Vice
President and President of the Dialysis Products Division and in this
position, EMPLOYEE will have full management responsibility for Dialysis
Products Division, Spectra Renal Management and Corporate Information
Services . EMPLOYEE shall report directly to the Chief Executive Officer.
EMPLOYEE shall to the best of his ability and experience competently,
loyally, diligently and conscientiously perform all of the duties and
obligations expressly or implicitly required under this Agreement.
EMPLOYEE further agrees that, in conducting business in the interest of
the EMPLOYER, he will not engage in, knowingly permit others under his
control to carry on, or induce others to engage in any practice or commit
any acts in violation of any federal or state or local law or ordinance.
4. COMPENSATION AND BENEFITS.
a) Base Salary. EMPLOYER shall pay EMPLOYEE for all services rendered a
base salary of Three Hundred Fifty Thousand Dollars and No Cents
($350,000) per year, (the "Base Salary"), payable in accordance with
FMC's payroll procedures, subject to customary withholding and
employment taxes. At the end of each year of employment hereunder,
EMPLOYEE's performance for the prior year shall be reviewed and
evaluated. If EMPLOYEE's performance is satisfactory, EMPLOYEE shall
receive an increase in his base salary commensurate with level of
achievement.
b) Incentive Compensation. During EMPLOYEE's employment with FMC,
EMPLOYEE shall be entitled to participate in FMC's Management Bonus
Plan and any other such incentive compensation plans as are now
available or may become available to other similarly positioned
senior executives of FMC. EMPLOYEE will be in the senior executive
eligibility Level I, wherein the target level bonus is forty percent
(40%) and the maximum bonus is eighty percent (80%) of base salary.
Funding for the plan is based upon attainment of specific individual
and company financial objectives. EMPLOYEE's entitlement to a bonus
under the Management Bonus Plan will be governed by terms of that
Plan.
c) Stock Plan. EMPLOYEE shall be eligibly to participate in the current
Fresenius Medical Care AG Stock Incentive Plan, and any future stock
incentive plan (individually a "Stock Plan" and collectively, the
"Stock Plans"), subject to IRS approval of such respective Stock
Plans. In addition to the existing options to purchase Fresenius
Medical Care AG Preference Shares previously granted to EMPLOYEE
(the "Existing Options"), EMPLOYEE shall be eligible to receive
additional option grants in amounts as and if approved by the
Fresenius Medical Care AG Managing Board.
d) Benefit Programs. EMPLOYEE shall continue to be eligible to
participate in the group employee benefits programs at the senior
executive level as now established or which subsequently become
available.
e) Life Insurance. EMPLOYEE will be provided with life insurance in
accordance with FMC's policy, currently capped at Four Hundred
Thousand Dollars ($400,000). EMPLOYEE will be provided with the
opportunity to purchase supplemental life insurance of an additional
Six Hundred Thousand Dollars ($600,000) beyond the current policy of
coverage at his own expense, with proof of good health.
f) Automobile. EMPLOYEE will be provided with a company car allowance
of Seven Hundred Dollars ($700) paid monthly and treated as ordinary
income.
g) Financial Planning/Tax Preparation. EMPLOYEE will be provided with
an allowance of One Thousand Dollars ($1,000) to be paid based upon
submitted documentation of expenses incurred as a result of
financial planning assistance or income tax preparation.
Reimbursement will be treated as ordinary income.
h) Expenses. EMPLOYEE will be reimbursed for travel and other expenses
related to the performance of his duties under the Agreement and in
accordance with the EMPLOYER's policies.
i) Vacation/PTO. EMPLOYEE shall be allowed to carry-over up to two
hundred (200) hours from year-to-year without losing such time.
EMPLOYEE shall also accrue PTO days at the maximum available to
senior executives which currently provides for thirty (30) days of
PTO per year.
5. TERMINATION OF EMPLOYMENT. EMPLOYEE's employment hereunder may be
terminated under the following circumstances:
a) Death. EMPLOYEE's employment hereunder shall terminate upon his
death.
b) Total Disability. The EMPLOYER may terminate EMPLOYEE's employment
hereunder upon EMPLOYEE becoming "Totally Disabled." For purposes of
this Agreement, EMPLOYEE shall be "Totally Disabled" if EMPLOYEE is
physically or mentally incapacitated so as to render EMPLOYEE
incapable of performing EMPLOYEE's usual and customary duties under
this Agreement. EMPLOYEE's receipt of Social Security disability
benefits or disability benefits under a Company-sponsored long-term
disability plan shall be deemed conclusive evidence of Total
Disability for purpose of this Agreement; provided, however, that in
the absence of EMPLOYEE's receipt of such Social Security or
long-term disability benefits, the Company's Board of Directors may,
in its reasonable discretion (but based upon medical evidence),
determine that EMPLOYEE is Totally Disabled.
c) Voluntary Termination. EMPLOYER or EMPLOYEE may terminate EMPLOYEE's
employment hereunder at any time after providing written notice to
the other party. The EMPLOYEE is required to give the EMPLOYER at
least thirty (30) days written notice if he wishes to terminate his
employment pursuant to this provision.
d) Termination by the EMPLOYER for Cause. The EMPLOYER may terminate
EMPLOYEE's employment for Cause at any time after providing thirty
(30) days' written notice to EMPLOYEE. Such notice shall specify in
reasonable detail the nature of the Cause, and during such thirty
(30) day period, EMPLOEE shall have the opportunity to cure the
stated Cause, if at all possible. If EMPLOYEE fails to cure a state
Cause, or if such Cause cannot be cured, EMPLOYEE's employment
hereunder shall terminate at the end of the thirty (30) day period,
but without prejudice to EMPLOYEE's right to contest the existence
of any
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stated Cause or to contest the fact that the Cause has not been
cured. For purposes of this Agreement, the term "Cause" shall mean,
with respect to the EMPLOYEE, any of the following: (i) conviction
of EMPLOYEE of a felony; (ii) deliberate and continual refusal to
satisfactorily perform employment duties reasonably requested by the
EMPLOYER; (iii) fraud or embezzlement determined in accordance with
the EMPLOYER's normal, internal investigative procedures
consistently applied in comparable circumstances to EMPLOYEES; (iv)
failure to obtain and maintain in good order any licenses required
for EMPLOYEE to perform his duties under this Agreement; or (v) a
breach of any of the covenants set forth in Section 7 below.
e) Termination by EMPLOYEE for Cause. This Agreement may be terminated
by EMPLOYEE in the event of a breach by FMC of any of its
obligations under this Agreement, provided EMPLOYEE gives FMC
written notice specifying the manner in which he believes FMC has
breached this Agreement and FMC has thirty (30) days from receipt of
such notice to cure such breach, or in the case of other than a
non-payment of money breach, if such breach cannot be cured within
thirty (30) days, to commence a good faith effort to cure.
f) Notice of Termination. Any termination by the EMPLOYER or the
EMPLOYEE under this Agreement shall be communicated by notice of
termination to the other party hereto. For purposes of this
Agreement, a Notice of Termination shall mean a notice in writing
which shall indicate the specific termination provision in this
Agreement relied upon to terminate EMPLOYEE's employment and shall
set forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of EMPLOYEE's employment under
the provision so indicated.
6. COMPENSATION FOLLOWING TERMINATION OF RETENTION.
a) Under all circumstances, upon termination the EMPLOYEE shall be
entitled to receive:
(i) Any accrued but unpaid Base Salary for services rendered to
the date of termination;
(ii) Accrued PTO; and
(iii) Any benefits to which EMPLOYEE may be entitled upon
termination pursuant to the plans, policies and arrangements
referred to in Section 4 hereof shall be determined and paid
in accordance with the terms of such plans, policies and
arrangements. EMPLOYEE shall have one (1) year from any such
termination to exercise his Vested Stock Option. Should he
fail to exercise these options within this period, they will
be forfeited at the end of that period.
b) In the event that EMPLOYEE's employment hereunder is voluntarily
terminated by the EMPLOYER in accordance with Section 5(c), or in
the event that EMPLOYEE's employment hereunder is terminated by the
EMPLOYEE in accordance with Section 5(e), the EMPLOYEE shall also be
entitled to receive:
(i) A payment equal to eighteen (18) months Base Salary, at
the rate in effect on the date of termination of
employment, such amount to be paid as salary
continuation with benefits. EMPLOYEE may request and FMC
will agree that any remaining salary continuation be
paid in a lump sum. If a lump sum is selected, all
benefits entitlement will cease as of the date of such
payment; and
(ii) A pro-rated portion of the EMPLOYEE's annual bonus based
upon termination or work date.
c) Any stock options or other awards will continue to vest in
accordance with the terms of the award and the plan pursuant to
which it was made. If the terms of any award and governing plan are
silent with respect to termination of employment, such award will
lapse immediately upon such termination.
7. NON-DISCLOSURE/NON COMPETITION AGREEMENT. EMPLOYEE acknowledges that
during the term of employment with EMPLOYER, he will have access to and
become acquainted with Confidential Information of
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the EMPLOYER. Confidential Information means all information related to
the present or planned business of FMC that has not been released publicly
by authorized representatives of FMC, and shall include but not be limited
to, trade secrets and know-how, inventions, marketing and sales programs,
employee, customer, patient and supplier information, information from
patient medical records, financial data, pricing information, regulatory
approval and reimbursement strategies, data, operations and clinical
manuals.
EMPLOYEE agrees not to use or disclose, directly or indirectly, any
Confidential Information of FMC at any time and in any manner, except as
required in the course of his employment with FMC or with the express
written authority of FMC.
EMPLOYEE understands that his non-disclosure obligations will continue
following his termination of employment.
EMPLOYEE agrees that during the term of his employment, and for a period
of one (1) year immediately after, he leaves the employment of FMC for any
reason or the end of the period during which EMPLOYEE continues to receive
salary continuation after leaving the employment of FMC, whichever is
greater, EMPLOYEE will not directly or indirectly for his own benefit or
the benefit of others:
a) render services for a competing organization in connection with
competing products as an employee, officer, agent, broker,
consultant, partner, stockholder (except that EMPLOYEE may own three
percent (3%) or less of the equity securities of any publicly-traded
company);
b) hire or seek to persuade any employee of FMC to discontinue
employment or to become employed in any competing organization or
seek to persuade any independent contractor or supplier to
discontinue its relationship with FMC; and
c) solicit, direct, take away or attempt to take away any business or
customers of FMC.
Nothing in this Agreement would preclude EMPLOYEE from working for a
competitor of FMC's subsequent to termination of EMPLOYEE's employment
provided EMPLOYEE will not be engaged, directly or indirectly, in any
business in which FMC is actively engaged at the time of EMPLOYEE's
termination or in any new business which FMC is in the process of setting
up in which EMPLOYEE had direct involvement while employed by FMC.
EMPLOYEE also agrees to inform FMC of any such employment with a
competitor before beginning such employment.
8. ENFORCEMENT OF COVENANTS.
a) EMPLOYEE agrees that if the EMPLOYER determines that EMPLOYEE has
breached any of the covenants set forth in Section 7 at any time,
the EMPLOYER shall have the right, notwithstanding anything herein
to the contrary, to discontinue any or all amounts otherwise payable
to EMPLOYEE hereunder. Such termination of employment or
discontinuance of payments shall be in addition to and shall not
limit any and all other rights and remedies that the EMPLOYER may
have against EMPLOYEE.
b) Right to Injunction. EMPLOYEE acknowledges that a breach of the
covenants set forth in Section 7 hereof will cause irreparable
damage to the EMPLOYER with respect to which the EMPLOYER's remedy
at law for damages will be inadequate. Therefore, in the event of
breach or anticipatory breach of the covenants set forth in this
section by EMPLOYEE, EMPLOYEE and the EMPLOYER agree that the
EMPLOYER shall be entitled to the following particular forms of
relief, in addition to remedies otherwise available to it at law or
equity: injunctions, both preliminary and permanent, enjoining or
restraining such breach or anticipatory breach and EMPLOYEE hereby
consents to the issuance thereof forthwith and without bond by any
court of competent jurisdiction.
c) Separability of Covenants. The covenants contained in Section 7
hereof constitute a series of separate covenants, one for each
applicable State in the United States and the District of Columbia,
and one for each applicable foreign country. If in any judicial
proceeding, a court shall hold that any of the covenants set
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forth in Section 7 exceed the time, geographic, or occupational
limitations permitted by applicable laws, EMPLOYEE and the EMPLOYER
agree that such provisions shall and are hereby reformed to the
maximum time, geographic, or occupational limitations permitted by
such laws. Further, in the event a court shall hold unenforceable
any of the separate covenants deemed included herein, then such
unenforceable covenant or covenants shall be deemed eliminated from
the provisions of this Agreement for the purpose of such proceeding
to the extent necessary to permit the remaining separate covenants
to be enforced in such proceeding. EMPLOYEE and the EMPLOYER further
agree that the covenants in Section 7 shall each be construed as a
separate agreement independent of any other provisions of this
Agreement, and the existence of any claim or cause of action by
Employee against the Company whether predicated on this Agreement or
otherwise, shall not constitute a defense to the enforcement by the
Company of any of the covenants in Section 7.
9. FMC DOCUMENTS AND EQUIPMENT. All documents and equipment relating to the
business of FMC, whether prepared by EMPLOYEE or otherwise coming into
EMPLOYEE's possession, are the exclusive property of FMC, and must not be
removed from the premises of FMC except as required in the course of
employment. Any such documents and equipment must be returned to FMC when
EMPLOYEE leaves the employment of FMC.
10. WITHHOLDING OF TAXES. The EMPLOYER may withhold from any compensation and
benefits payable under this Agreement all applicable federal, state,
local, or other taxes.
11. ENTIRE AGREEMENT AND AMENDMENTS. This Agreement shall constitute the
entire agreement between the parties and supersedes all existing
agreements between them, whether oral or written, with respect to the
subject matter hereof. Any waiver, alteration, or modification of any of
the provisions of this Agreement, or cancellation or replacement of this
Agreement shall be accomplished in writing and signed by the respective
parties.
12. NOTICES. Any notice, consent, request or other communication made or given
in connection with this Agreement shall be in writing and shall be deemed
to have been duly given when delivered or mailed by registered or
certified mail, return receipt requested, to those listed below at their
following respective addresses or at such other address as each may
specify by notice to the others:
To the Employer:
Fresenius Medical Care North America
Corporate Headquarters
Two Ledgemont Center
00 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000
Attention: Vice President, Human Resources
To Employee:
At the address for Employee set forth above
13. GOVERNING LAW. This Agreement shall be construed in accordance with, and
the rights of the parties shall be governed by, the laws of the
Commonwealth of Massachusetts.
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14. SEPARABILITY. If any term or provision of this Agreement is declared
illegal or unenforceable by any court of competent jurisdiction and cannot
be modified to be enforceable, such term or provision shall immediately
become null and void, leaving the remainder of this Agreement in full
force and effect.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by the
undersigned duly authorized persons as of the day and year first stated above.
NATIONAL MEDICAL CARE, INC. D/B/A
FRESENIUS MEDICAL CARE
WITNESS NORTH AMERICA, EMPLOYER
/s/ Xxxxxxxx Xxxxxxxx By: /s/ Xxx X. Xxxxx 6/6/02
---------------------------- ---------------------------------- ------
Xxx X. Xxxxx (DATE)
Chief Executive Officer
WITNESS XXXXXX "RICE" X. XXXXXX, XX.
/s/ Xxxxx X'Xxxxxxx /s/ Xxxxxx Xxxxxxx Xxxxxx 5/29/02
---------------------------- -------------------------------------- -------
(Employee Signature) (DATE)
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