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EXHIBIT 10.11
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of this 1st day of
March, 1997 by and between RENEX CORP., a Florida corporation ("Company"), and
MIGNON EARLY ("EARLY").
R E C I T A L S:
A. The Company is a provider of kidney dialysis treatments in
various parts of the United States to individuals suffering from end-stage renal
disease (the "Business"); and
B. EARLY has been employed by the Company in various capacities;
and
C. The Company desires to continue to employ EARLY as Vice
President/ Operations and EARLY desires to continue to be employed by the
Company on the terms and conditions provided herein.
NOW THEREFORE, in consideration of the mutual promises and
covenants contained in this Agreement and such other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
1. RECITATIONS. The above recitations are true and correct and
are incorporated herein by this reference.
2. POSITION OF EMPLOYMENT. The Company hereby employs EARLY as
Vice President/Operations on the terms and conditions set forth in this
Agreement.
2.1. PERFORMANCE OF DUTIES. EARLY shall perform such
duties as are usually performed by a Vice President/Operations of a business
similar in size and scope as the Business and such other reasonable additional
duties as may be prescribed from time to time by the Company's Board of
Directors consistent with the operations of the Company. EARLY shall report
directly to the Company's President or such other officers designated by the
Company's president from time to time. All actions of EARLY shall be subject and
subordinate to the review and approval of the Company's executive officers and
Board of Directors. The precise responsibilities of EARLY may be modified from
time to time in accordance with reasonable policy established by the Company's
executive officers.
2.2. DEVOTION OF TIME. During the term of EARLY's
employment, EARLY shall devote her full time, ability and attention to the
business affairs of the Company. EARLY agrees to use her best efforts to perform
faithfully and efficiently all of her responsibilities pursuant to this
Agreement.
2.3. LOCATION OF EMPLOYMENT. During the term of this
Agreement, EARLY's principal place of business shall be located in Dade County,
Florida at the Company's corporate offices. EARLY agrees to permanently relocate
her principal residence to South Florida no later than June 1, 1997 as a
material condition to this Agreement.
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3. TERM OF EMPLOYMENT
3.1. TERM OF EMPLOYMENT. This Agreement shall begin on
the date hereof (the "Commencement Date") and shall end on February 28, 2000,
subject to earlier termination as otherwise set forth in this Agreement.
3.2. TERMINATION OF EMPLOYMENT BY THE COMPANY FOR CAUSE.
The Company may terminate EARLY's employment immediately, if such termination is
for "Cause." For purposes of this Agreement, "Cause" shall include: (a) death of
EARLY; (b) a default or breach by EARLY of any of the provisions of this
Agreement, including the failure to relocate her principal residence to South
Florida by June 1, 1997; (c) actions by EARLY constituting fraud, embezzlement
or dishonesty; (d) furnishing false, misleading, or omissive information or
omitting to furnish material information to the Company in the reasonable
judgment of the Company; (e) any action which constitutes a breach of the
confidentiality of the Business and/or trade secrets of the Company; (f) the
violation of federal or state law, which has a material adverse impact on the
Business or EARLY's ability to perform all of her obligations in this Agreement;
(g) gross insubordination; (h) intoxication by alcohol or drugs during the
performance of EARLY's duties; (i) failure to follow reasonable and lawful
directives of the Company's executive officers or Board of Directors; or (j) at
such time as EARLY shall have failed, by reason of mental or physical disability
or illness ("Disability" as hereinafter defined), to perform her services
pursuant to this Agreement for a period of thirty (30) days. Disability shall be
defined to mean the inability of EARLY to perform her duties under this
Agreement, as determined by an independent physician selected by the Company;
provided, however, if the Company maintains a policy insuring against the
disability of EARLY, Disability shall have the meaning ascribed in such policy.
Upon termination for Cause, the Company shall not be liable for
payment of any further compensation, other than Base Salary accrued prior to the
effective date of such termination. Notwithstanding any termination pursuant to
this Section 3.2, the provisions of Section 6 and 7 of this Agreement shall
remain in full force and effect.
3.3. TERMINATION BY EARLY. EARLY may terminate this
Agreement upon thirty (30) days written notice, with or without cause. Upon such
termination, the Company shall not be liable for any compensation, other than
the Base Salary accrued prior to the effective date of such termination.
Notwithstanding termination in accordance with this Section 3.3, the provisions
of Sections 6 and 7 herein shall remain in full force and effect.
3.4. TERMINATION WITHOUT CAUSE BY THE COMPANY PRIOR TO
CHANGE OF CONTROL. The Company shall have the right to terminate this Agreement
without cause at any time on thirty (30) days written notice. Upon termination
by the Company, without cause prior to a "Change of Control", the Company shall
pay to EARLY as severance compensation, (a) Base Salary accrued through the
effective date of termination; and (b) six (6) months Base Salary. Such payments
shall be made through regular payroll methods for the six (6) months following
termination. Normal withholding and FICA will be deducted from such payments. In
addition, the Company will pay the premiums on EARLY's health insurance for a
period of six (6) months following termination. Thereafter, EARLY will be
entitled to such benefits mandated under the Comprehensive Omnibus Budget
Reconciliation Act of 1985 ("COBRA"). Notwithstanding termination in accordance
with this Section 3.4, the provisions of Sections 6 and 7 herein shall remain in
full force and effect.
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3.5. TERMINATION WITHOUT CAUSE FOLLOWING CHANGE OF
CONTROL. If the Company terminates this Agreement without cause, following a
Change of Control (as defined in Section 3.6 herein), EARLY shall be entitled to
receive, as severance for such termination, an amount equal to (a) all accrued
Base Salary through the date of termination; and (b) one (1) year's Base Salary.
The relocation expenses shall be paid within fifteen (15) days following the
date of termination. The one (1) year's Base Salary severance will be payable
over a one (1) year period through regular payroll methods consistent with
payroll periods for other employees of the Company. Normal withholding and FICA
will be deducted from such payments. In addition, the Company will continue to
pay the premiums on EARLY's health insurance for such one (1) year period.
Further, all stock options therefore granted to EARLY shall immediately vest in
EARLY for the balance of the terms of such options and EARLY shall have the
right to exercise such options for the full term thereof. Following the one (1)
year severance period, EARLY shall be entitled to such benefits as mandated by
COBRA.
3.6. CHANGE OF CONTROL. Change of Control is defined for
the purposes of this Agreement as any of the following acts:
3.6.1. The acquisition by any person, entity or
"group" within the mean of ss. 13(d) or 14(d) of the Securities Exchange Act of
1934 (the "Exchange Act") of beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of fifty (50%) percent or more of
either the then outstanding shares of the Company's common stock or the combined
voting power of the Company's then outstanding voting securities entitled to
vote generally in the election of directors; or
3.6.2. If the individuals who serve on the
Company's Board of Directors as of the Commencement Date (the "Incumbent Board")
cease for any reason to constitute at least a majority of the Board of
Directors; provided, however, that any person who becomes a director subsequent
to the Commencement Date whose nomination for election was approved by a vote of
at least a majority of the directors then comprising the Incumbent Board, shall
be for purposes of this Agreement considered as if such person was a member of
the Incumbent Board; or
3.6.3. Approval by the Company's stockholders of
(i) a merger, reorganization or consolidation whereby the Company's shareholders
immediately prior to such approval do not, immediately after consummation of
such reorganization, merger or consolidation own more than 50% of the combined
voting power entitled to vote generally in the election of directors of the
surviving entity's then outstanding voting securities; or (ii) liquidation or
dissolution of the Company; or (iii) the sale of all or substantially all of the
assets of the Company.
4. COMPENSATION AND BENEFITS
4.1. SALARY. During the term of this Agreement, the
Company shall pay to EARLY, a base salary at a total annual rate of $80,000 (the
"Base Salary"). Base Salary shall be payable in installments consistent with the
Company's normal payroll schedules in effect from time to time, subject to
applicable withholding and other taxes.
4.2. ANNUAL REVIEWS. At the end of each year during the
term thereof, the parties agree to confer and review the propriety of adjusting
EARLY's Base Salary. The Company shall review EARLY's performance and the
success of the Business and determine in good faith whether it is appropriate in
light of all circumstances to increase the Base Salary. Nothing set forth herein
shall obligate the Company in any way to increase EARLY's Base Salary.
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4.3. BONUS. EARLY shall be entitled to a bonus equal to
fifty (50%) of her then Base Salary for each fiscal year during the term hereof
(the "Total Bonus"). Fifty percent (50%) of such Total Bonus will be paid if the
Company achieves 100% or more of its budgeted pre-tax income (as determined by
the Company's audited financial statements for such fiscal year). For purposes
of this Agreement, budgeted pre-tax income shall be the pre-tax income included
in the annual budget approved by the Company's board of directors for such
fiscal year. The other 50% of Total Bonus will be paid based upon the attainment
of 100% or more of the combined annual pre-tax profits set forth in the annual
budget for all clinics that are in operation for the full fiscal year. Such
bonuses, if any, is payable within thirty (30) days following the issuance of
the audited financial statements for such fiscal year.
4.4. TEMPORARY LIVING EXPENSES. The Company will provide
EARLY temporary living expenses in the Miami area for the period of time from
the date of this Agreement through the earlier of (a) permanent relocation of
EARLY's principal residence to South Florida, or (b) June 1, 1997. Such
temporary living expense shall consist of the following: (i) housing, at the
option of the Company, consisting of (A) the cost of a furnished one bedroom
apartment, or (B) a hotel room; (ii) the use of a rental compact automobile
while in South Florida; and (iii) a per diem and miscellaneous expense allowance
of $50 per day while living in a hotel in South Florida. The per diem meal
allowance will be discontinued when EARLY relocates to an apartment. The $50 per
diem will be paid for each week day while residing in a hotel and will not
require receipts. Upon permanent relocation, the Company shall pay to EARLY
$1,000 for incidental moving expenses which will also not require receipts.
4.5. RELOCATION EXPENSE. The Company will reimburse EARLY
for expenses associated with the move of her household belongings. As expenses
are incurred, the Company shall either reimburse EARLY for such expenses or the
Company will make direct payments to EARLY's creditors on her behalf. Prior to
the permanent relocation, the Company will pay for two round-trip airfares for
EARLY's spouse in connection with a housing search.
4.6. STOCK OPTIONS. Within ten (10) days following
permanent relocation of EARLY's permanent residence to South Florida, the
Company shall grant to EARLY options to purchase 20,000 shares of Common Stock
pursuant to the Company's Employee Stock Option Plan. The number of shares to be
granted shall be equitably adjusted for any reverse stock split occurring
between the date of this Agreement and the date of grant. Such options shall be
for a term of five (5) years and vest over a three (3) year period. The exercise
price of such options shall be the fair market value of the underlying Common
Stock on the date of grant.
4.7. ADDITIONAL BENEFITS.
4.7.1. VACATION. EARLY shall be entitled to such
vacation and/or paid time off as well as recognized holidays, consistent with
the Company's policy established from time to time for its employees. Vacation
time may not be accumulated from year to year unless expressly provided
otherwise.
4.7.2. REIMBURSEMENT OF EXPENSES. EARLY shall be
reimbursed by the Company, upon presentation of adequate receipts, for all
ordinary and necessary business expenses which are incurred by EARLY in the
performance of her duties under this Agreement, subject to and limited by such
budgets as may be adopted by the Company for EARLY's department.
Notwithstanding, expenses in excess of $200 per item shall require the prior
approval of the President or Chief Financial Officer of the Company in order to
obtain reimbursement.
4.7.3. PARTICIPATION IN EMPLOYEE BENEFIT PLANS.
EARLY shall be entitled to participate, subject to eligibility and other terms
generally established by the Company's board of directors, in any group
hospitalization, health, dental care, profit sharing and pension, and other
benefit plans, as may be adopted or amended by the Company from time to time as
affecting employees of similar status.
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5. REPRESENTATIONS. EARLY hereby represents to the Company that
she is in good health, she is physically and mentally capable of performing her
duties hereunder and he has no knowledge of any present or past physical or
mental condition which would cause an insurance company to reject an application
by EARLY for life insurance or for accident, sickness or disability insurance.
EARLY represents and warrants that to the best of her knowledge she is not
subject to any restrictive covenants under any other agreements prohibiting any
portion of her performance hereunder, or which would subject the Company to any
valid claims for tortious interference.
6. CONFIDENTIALITY AND NON-DISCLOSURE OF INFORMATION.
6.1. CONFIDENTIALITY. EARLY shall not, during the term of
this Agreement or at any time thereafter, divulge, furnish or make accessible to
anyone without the Company's prior written consent any knowledge or information
with respect to any confidential or secret aspect of the Business, including but
not limited to: the Company's costs; supplier's names; patient names, referral
sources, physician names; patient addresses and telephone numbers of patients
and referral sources; billing procedures, prices and terms; the business
techniques, computer programs and printouts; identity of prospective patient or
referral sources; confidential information disclosed by the Company's patients
to the Company; or other information concerning the Business or its employees.
All information given to EARLY in connection with her employment shall be
considered confidential and proprietary, unless such information becomes
generally available to the public other than as a result of a disclosure by
EARLY or required to be disclosed by operation of law.
6.2. OWNERSHIP OF INFORMATION. EARLY recognizes that all
records, patient lists, referral lists, supplier lists, material cost data,
files, correspondence with patients, referral services, and suppliers of
material and services, computer printouts, contracts, reports, notes, business
plans, compilations of other recorded matter, and copies or reproductions
thereof, relating to the Company's operations and activities and other
information relating to the Company's patients, referral sources and suppliers,
made or received by EARLY in the course of her employment are the exclusive
property of the Company and EARLY holds and uses same as trustee for the Company
and subject to the Company's sole control and will deliver same to the Company
at the termination of her employment, or earlier if so requested. All of such
information, which if used by EARLY outside the scope of her employment, could
cause irreparable and continuing injury to the Business for which there may not
be an adequate remedy at law.
6.3. BREACH. Any breach of the terms of this Section 6 by
EARLY shall be deemed a material breach of this Agreement. EARLY acknowledges
that compliance with the provisions of this Section 6 is necessary to protect
the goodwill and other proprietary interests of the Company and is a material
condition of employment.
7. RESTRICTIVE COVENANT. EARLY covenants and agrees that:
7.1. RESTRICTION. During her employment and for a period
of six (6) months after she ceases to be employed by the Company, regardless of
the manner or cause of termination, EARLY will not be an employee, agent,
director, stockholder or owner (except of not more than 1% of the securities of
any publicly traded entity), partner, consultant, financial backer, creditor or
be otherwise directly or indirectly connected with or participate in the
management, operation or control of any business, firm, proprietorship,
corporation, partnership, association, entity or venture primarily engaged in
the same or similar Business, within fifty (50) miles of any clinic, center or
office of the Company.
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7.2. SOLICITATION OF BUSINESS. During her employment and
for a period of one (1) year after she ceases to be employed by the Company,
regardless of the manner or cause of termination, EARLY will not contact, call
upon, solicit business from, sell or render services to any physician, referral
source or patient of the Company, or any of its affiliates with respect to the
same or similar Business or purchase from any supplier or potential supplier any
materials for same and EARLY shall not directly or indirectly aid or assist any
other person, firm or corporation to do any of the aforesaid acts.
7.3. SOLICITATION OF EMPLOYEES. During her employment and
for a period of one (1) year after she ceases to be employed by the Company,
regardless of the manner or cause of termination, EARLY will not directly or
indirectly, as principal, agent, owner, partner, stockholder, officer, director,
employee, independent contractor or consultant or in any individual or
representative capacity for himself or on behalf of any business, firm,
corporation, partnership, association or proprietorship enter into any
agreements with, solicit, or directly or indirectly cause others to solicit the
employment of any officer, sales person, agent, or other employee of the
Company, or any of its subsidiaries or affiliates for the purpose of causing
said officer, sales person, agent or other employee to terminate employment with
the Company.
7.4. MATERIAL VIOLATION. A violation of this Section 7
shall constitute a material and substantial breach of this Agreement and shall
result in the imposition of the Company's remedies contained in Section 9. EARLY
acknowledges and agrees that proof of one such personal solicitation by EARLY of
a patient, physician referral source, supplier or employee, shall constitute
absolute and conclusive evidence that EARLY has substantially and materially
breached the provisions of this Agreement.
7.5. MATERIAL COVENANTS. It is understood by and between
the parties that the foregoing covenants set forth in Sections 6 and 7 are
essential elements of this Agreement, and that but for the agreement of EARLY to
comply with such covenants, the Company would not have agreed to employ EARLY.
Such covenants by EARLY shall be construed as agreements independent of any
other provision of this Agreement and the existence of any claim or cause of
action EARLY may have against the Company whether predicated on this Agreement
or otherwise, shall not constitute a defense to the enforcement by the Company
of these covenants.
7.6. NON-ENHANCEMENT OF RESTRICTIVE COVENANT.
Notwithstanding anything herein to the contrary, the restrictive covenant
contained in Section 7.1 herein shall not be enforceable if this Agreement is
terminated in accordance with Section 3.5 herein.
8. ACKNOWLEDGEMENT. EARLY HEREBY ACKNOWLEDGES AND UNDERSTANDS
THIS AGREEMENT INHIBITS EARLY'S ABILITY TO WORK FOR THE SAME OR SIMILAR KIND OF
BUSINESS FOR A PERIOD OF SIX (6) MONTHS AFTER THE END OF EARLY'S EMPLOYMENT WITH
THE COMPANY. EARLY acknowledges and confirms that the length of the term and
geographic restrictions contained in this Agreement are fair and reasonable and
not the result of overreaching, duress or coercion of any kind. EARLY further
acknowledges and confirms that her full, uninhibited and faithful observance of
each of the covenants contained in this Agreement will not cause any undue
hardships, financial or otherwise and that enforcement of this Agreement will
not impair EARLY's ability to obtain employment commensurate with EARLY's
abilities and on terms fully acceptable to EARLY. EARLY acknowledges that EARLY
will be receiving significant information regarding the Business which EARLY has
not previously received and would not receive without being employed by the
Company. EARLY acknowledges and confirms that such information would cause the
Company serious injury and loss if used by EARLY for the benefit of a
competitor.
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9. REMEDIES. EARLY hereby acknowledges, covenants and agrees that
in the event of a material default or breach under this Agreement:
9.1. The Company will suffer irreparable and continuing
damages as a result of such breach and its remedy at law will be inadequate.
EARLY agrees that in the event of a violation or breach of this Agreement, in
addition to any other remedies available to them, the Company shall be entitled
to an injunction restraining any such default or any other appropriate decree of
specific performance, without any requirement to prove actual damages or to post
any bond or any other security and to any other equitable relief the court deems
proper; and
9.2. Any and all of the Company's remedies described in
this Agreement shall not be exclusive and shall be in addition to any other
remedies which the Company may have at law or in equity including, but not
limited to, the right to monetary damages.
10. SEVERABILITY. The invalidity of any one or more of the words,
phrases, sentences, clauses, sections, subdivisions, subparagraphs, paragraphs
or articles contained in this Agreement shall not affect the enforceability of
the remaining portions of this Agreement or any part thereof, all of which are
inserted conditionally on their being legally valid. In the event that one or
more of the words, phrases, sentences, clauses, sections, subdivisions,
subparagraphs, paragraphs or articles are determined to be unenforceable and if
such invalidity shall be caused by the length of any period of time or the size
of any area set forth in any part hereof, such period of time or such area, or
both, shall be considered to be reduced to a period or area which would cure
such invalidity.
11. NOTICE. Any notices or other communications to any party
pursuant to or relating to this Agreement must be in writing and shall be deemed
to have been given or delivered when hand-delivered, mailed through the U.S.
Postal Service via certified mail, return receipt requested, postage prepaid,
through a nationally recognized overnight courier, or via facsimile to the party
at their addresses below:
Company: RENEX CORP.
0000 Xxxxx xx Xxxx Xxxxxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxx, President
Fax No.: (000) 000-0000
with a copy to: Xxxxx X. Xxxxxx, Esq.
Wallace, Bauman, Fodiman & Xxxxxxx, P.A.
Bankers Savings Bank Building
2222 Xxxxx de Xxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxx Xxxxxx, Xxxxxxx 00000
Fax No.: (000) 000-0000
EARLY: Mignon EARLY
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or such other address given by such party to the other party at any time
hereafter.
12. ENTIRE AGREEMENT. This Agreement contains the sole and entire
agreement between the parties with respect to the subject matter hereof and
supersedes any and all other prior written or oral agreements between them as to
such subject matter.
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13. AMENDMENT. No amendment, waiver or modification of this
Agreement or any provisions of this Agreement shall be valid unless in writing
and duly executed by both parties.
14. BINDING AGREEMENT. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective heirs, legal
representatives, successors and assigns.
15. WAIVER. Any waiver by any party of any breach of any
provision of this Agreement shall not be considered as or constitute a
continuing waiver or waiver of any other breach of any provision of this
Agreement.
16. ASSIGNMENT. No party may assign their rights hereunder
without the prior written consent of the other, except that the Company may
assign its rights to any affiliate or successor entity without the consent of
EARLY.
17. CAPTIONS. Captions contained in this Agreement are inserted
only as a matter of convenience or for reference and in no way defines, limits,
extends, or describes the scope of this Agreement or the intent of any
provisions of this Agreement.
18. ATTORNEYS' FEES. In the event of any litigation arising out
of this Agreement, the prevailing party shall be entitled to recover its
attorneys' fees and costs, including attorneys' fees and costs incurred on
appeal.
19. GOVERNING LAW. This Agreement shall be governed by the laws
of the State of Florida.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the day and year first above written.
RENEX CORP., a Florida corporation
By:
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XXXXX X. XXXX, President
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MIGNON EARLY
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