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EXHIBIT 10.70
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, dated as of the 10 day of
November, 1996 (the "Agreement"), by and between VISION 21, INC., a Florida
corporation, (the "Company"), and XXXX X. XXXXXXX (the "Executive").
WHEREAS, the Company is presently engaged in the business of
providing physician practice management services and related services to
ophthalmologists, optometrists and other eye care providers;
WHEREAS, the Executive has experience in the human resources
field;
WHEREAS, the Company wishes to assure itself of the services
of the Executive for the period provided in this Agreement and the Executive is
willing to serve in the employ of the Company for such period upon the terms
and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the mutual covenants
herein contained, the parties, intending to be legally bound, hereby agree as
follows:
1. EMPLOYMENT
The Company hereby agrees to continue to employ the Executive
upon the terms and conditions herein contained, and the Executive hereby agrees
to accept such employment for the term described below. The Executive agrees to
serve as the Company's Director of Human Resources and to perform the duties
and functions customarily performed by the Director of Human Resources of a
publicly traded firm during the term of this Agreement. In such capacity, the
Executive shall have such powers and responsibilities consistent with her
position as the Chief Executive Officer and Board of Directors may assign to
her.
Throughout the term of this Agreement, the Executive shall
devote her best efforts and substantially all of her business time and services
to the business and affairs of the Company.
2. TERM OF AGREEMENT
The two (2) year initial term of employment under this
Agreement shall commence as of November 10, 1996 (the "Effective Date"). After
the expiration of such two year initial employment period, the term of the
Executive's employment hereunder shall automatically be extended without
further action by the parties for successive one (1) year renewal terms,
provided that if either party gives the other party at least thirty (30) days
advance written notice of her or its intention to not renew this Agreement for
an additional term, the Agreement shall terminate upon the expiration of the
current term.
Notwithstanding the foregoing, the Company shall be entitled
to terminate this Agreement immediately, subject to a continuing obligation to
make any payments required under Section 5 below, if the Executive (i) becomes
disabled as described in Section 5(b), (ii) is terminated for Cause, as defined
in Section 5(c), or (iii) voluntarily terminates her employment before the
current term of this Agreement expires, as described in Section 5(d).
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3. SALARY AND BONUS
The Executive shall receive a base salary during the term of
this Agreement at a rate of not less than $75,000 per annum, payable in
installments consistent with the Company's normal payroll schedule. The
Compensation Committee of the Board shall consult with the President and review
this base salary at annual intervals, and may adjust the Executive's annual
base salary from time to time as the Committee deems to be appropriate.
The Executive shall also be eligible to receive an annual
incentive bonus from the Company for each fiscal year of the Company during the
term of this Agreement. If the Company has fully achieved such financial
performance targets as may be set for the fiscal year by the Compensation
Committee, the amount payable to the Executive shall be 30 percent of her
annual base salary in effect on the last day of the year. If the Company fails
to fully achieve its financial performance targets for the fiscal year, the
portion of such bonus which shall be paid to the Executive shall be such amount
as may be determined to be appropriate by the Compensation Committee of the
Company's Board, based on the Company's partial achievement of the performance
measures.
4. ADDITIONAL COMPENSATION AND BENEFITS
The Executive shall receive the following additional
compensation and welfare and fringe benefits:
(a) Stock Options. As of the Effective Date of this
Agreement, the Executive shall be granted nonstatutory stock options
with respect to 35,000 shares of common stock pursuant to the terms of
the Company's 1996 Stock Incentive Plan, with options to vest in a
series of four equal installments. During the remaining term of the
Agreement, any additional stock option or restricted stock awards
under the 1996 Stock Incentive Plan shall be at the discretion of the
Compensation Committee of the Company's Board.
(b) Medical Insurance. The Company shall provide the
Executive and her dependents with health insurance coverage no less
favorable than that from time to time made available to other key
employees.
(c) Vacation. The Executive shall be entitled to up to four
weeks of vacation during each year during the term of this Agreement
and any extensions thereof, prorated for partial years.
(d) Relocation Allowance. The Company shall provide the
Executive with an allowance of up to three thousand dollars ($3,000)
to reimburse her for the costs of relocating her household to the
Tampa, Florida metropolitan area.
(e) Business Expenses. The Company shall reimburse the
Executive for all reasonable expenses she incurs in promoting the
Company's business, including expenses for travel, entertainment of
business associates and similar items, upon presentation by the
Executive from time to time of an itemized account of such
expenditures.
In addition to the benefits provided pursuant to the
preceding paragraphs of this Section 4, the Executive shall be eligible to
participate in such other executive compensation and retirement plans of the
Company as are applicable generally to other officers, and in such welfare
benefit plans, programs, practices and policies of the Company as are generally
applicable to other key employees.
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5. PAYMENTS UPON TERMINATION
(a) Involuntary Termination. If the Executive's employment is
terminated by the Company during the term of this Agreement, the Executive
shall be entitled to receive her base salary accrued through the date of
termination. The Executive shall also receive any nonforfeitable benefits
already earned and payable to her under the terms of any deferred compensation,
incentive or other benefit plan maintained by the Company, payable in
accordance with the terms of the applicable plan.
If the termination is not for death, disability as described
in paragraph (b), for Cause as described in paragraph (c) or a voluntary
termination by the Executive as described in paragraph (d), the Company shall
also be obligated to make a series of monthly payments to the Executive for
each month during the remaining term of this Agreement, but not less than
twelve (12) months. Each monthly payment shall be equal to one-twelfth (1/12th)
of the Executive's annual base salary, as in effect on the date of termination.
(b) Disability. The Company shall be entitled to terminate
this Agreement, if the Board determines that the Executive has been unable to
attend to her duties for at least ninety (90) days because of a medically
diagnosable physical or mental condition, and has received a written opinion
from a physician acceptable to the Board that such condition prevents the
Executive from resuming full performance of her duties and is likely to
continue for an indefinite period. Upon such termination, the Company shall pay
to Executive a monthly disability benefit equal to one-twenty-fourth (1/24th)
of her current annual base salary at the time she became permanently disabled.
Payment of such disability benefit shall commence on the last day of the month
following the date of the termination by reason of permanent disability and
cease with the earliest of (i) the month in which the Executive returns to
active employment, either with the Company or otherwise, (ii) the end of the
initial term of this Agreement, or the current renewal term, as the case may
be, or (iii) the twenty-fourth month after the date of the termination. Any
amounts payable under this Section 5(b) shall be reduced by any amounts paid to
the Executive under any long-term disability plan or other disability program
or insurance policies maintained or provided by the Company.
(c) Termination for Cause. If the Executive's employment is
terminated by the Company for Cause, the amount the Executive shall be entitled
to receive from the Company shall be limited to her base salary accrued through
the date of termination, and any nonforfeitable benefits already earned and
payable to the Executive under the terms of deferred compensation or incentive
plans maintained by the Company.
For purposes of this Agreement, the term "Cause" shall be
limited to (i) any action by the Executive involving willful disloyalty to the
Company, such as embezzlement, fraud, misappropriation of corporate assets or a
breach of the covenants set forth in Sections 9 and 10 below; or (ii) the
Executive being convicted of a felony; or (iii) the Executive being convicted
of any lesser crime or offense committed in connection with the performance of
her duties hereunder or involving moral turpitude; or (iv) the intentional and
willful failure by the Executive to substantially perform her duties hereunder
as directed by the Company's Chief Executive Officer or Board of Directors
(other than any such failure resulting from the Executive's incapacity due to
physical or mental disability).
(d) Voluntary Termination by the Executive. If the Executive
resigns or otherwise voluntarily terminates her employment before the end of
the current term of this Agreement, the amount the Executive shall be entitled
to receive from the Company shall be limited to her base salary accrued through
the date of termination, and any nonforfeitable benefits already earned and
payable to the Executive under the terms of any deferred compensation or
incentive plans of the Company.
For purposes of this paragraph, a resignation by the
Executive shall not be deemed to be voluntary if the Executive resigns during
the period of three months after the date she is (1) assigned to a position of
lesser rank (other than for Cause, or by reason of permanent disability), (2)
assigned duties materially inconsistent with such position.
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6. EFFECT OF CHANGE IN CORPORATE CONTROL
(a) In the event of a Change in Corporate Control, the
vesting of any stock options or other awards granted to the Executive under the
terms of the Company's 1996 Stock Incentive Plan shall become immediately
vested in full and, in the case of stock options, exercisable in full.
In addition, if, at any time during the period of twelve (12)
consecutive months following the occurrence of a Change in Corporate Control,
the Executive is involuntarily terminated (other than for Cause) by the
Company, the Executive shall be entitled to receive as severance pay in lieu of
the monthly payments described in Section 5(a) above, a series of twelve (12)
equal monthly payments, each equal to one-twelfth (1/12th) of the sum of (i)
the Executive's annual base salary in effect at the time of the Change in
Corporate Control plus (ii) the annual bonus paid to the Executive with respect
to the last fiscal year of the Company ending prior to the Change in Corporate
Control.
(b) For purposes of this Agreement, a "Change in Corporate
Control" shall include any of the following events:
(1) The acquisition in one or more transactions of
more than thirty percent of the Company's outstanding Common Stock by
any corporation, or other person or group (within the meaning of
Section 14(d)(3) of the Securities Exchange Act of 1934, as amended);
(2) Any merger or consolidation of the Company into
or with another corporation in which the Company is not the surviving
entity, or any transfer or sale of substantially all of the assets of
the Company or any merger or consolidation of the Company into or with
another corporation in which the Company is the surviving entity and,
in connection with such merger or consolidation, all or part of the
outstanding shares of Common Stock shall be changed into or exchanged
for other stock or securities of any other person, or cash, or any
other property.
(3) Any election of persons to the Board of
Directors which causes a majority of the Board of Directors to consist
of persons other than (i) persons who were members of the Board of
Directors on September 1, 1996, and (ii) persons who were nominated
for election as members of the Board by the Board of Directors (or a
Committee of the Board) at a time when the majority of the Board (or
of such Committee) consisted of persons who were members of the Board
of Directors on September 1, 1996; provided, that any person nominated
for election by the Board of Directors composed entirely of persons
described in (i) or (ii), or of persons who were themselves nominated
by such Board, shall for this purpose be deemed to have been nominated
by a Board composed of persons described in (i).
(4) Any person, or group of persons, announces a
tender offer for at least thirty percent (30%) of the Company's Common
Stock.
provided that, no acquisition of stock by any person in a public offering or
private placement of the Company's common stock or other transaction approved
by the Company's Board of Directors shall be considered a Change in Corporate
Control.
(c) Notwithstanding anything else in this Agreement, the
amount of severance compensation payable to the Executive as a result of a
Change in Corporate Control under this Section 6, or otherwise, shall be
limited to the maximum amount the Company would be entitled to deduct pursuant
to Section 280G of the Internal Revenue Code of 1986, as amended.
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7. DEATH
If the Executive dies during the term of this Agreement, the
Company shall pay to the Executive's estate a lump sum payment equal to the sum
of the Executive's base salary accrued through the date of death plus the total
unpaid amount of any bonuses earned with respect to the fiscal year of the
Company most recently ended. In addition, the death benefits payable by reason
of the Executive's death under any retirement, deferred compensation or other
employee benefit plan maintained by the Company shall be paid to the
beneficiary designated by the Executive in accordance with the terms of the
applicable plan or plans.
8. WITHHOLDING
The Company shall, to the extent permitted by law, have the
right to withhold and deduct from any payment hereunder any federal, state or
local taxes of any kind required by law to be withheld with respect to any such
payment.
9. PROTECTION OF CONFIDENTIAL INFORMATION
The Executive agrees that she will keep all confidential and
proprietary information of the Company or relating to its business (including,
but not limited to, information regarding the Company's customers, pricing
policies, methods of operation, proprietary computer programs and trade
secrets) confidential, and that she will not (except with the Company's prior
written consent), while in the employ of the Company or thereafter, disclose
any such confidential information to any person, firm, corporation, association
or other entity, other than in furtherance of her duties hereunder, and then
only to those with a "need to know." The Executive shall not make use of any
such confidential information for her own purposes or for the benefit of any
person, firm, corporation, association or other entity (except the Company)
under any circumstances during or after the term of her employment. The
foregoing shall not apply to any information which is already in the public
domain, or is generally disclosed by the Company or is otherwise in the public
domain at the time of disclosure.
The Executive recognizes that because her work for the
Company will bring her into contact with confidential and proprietary
information of the Company, the restrictions of this Section 9 are required for
the reasonable protection of the Company and its investments and for the
Company's reliance on and confidence in the Executive.
10. COVENANT NOT TO COMPETE
The Executive hereby agrees that she will not, either during
the Employment Term or during the period of twelve (12) months from the time
the Executive's employment under this Agreement is terminated, engage in any
business activities on behalf of any enterprise which competes with the Company
in the business of managing ophthalmology or optometry practices or related eye
care or medical facilities. The Executive will be deemed to be engaged in such
competitive business activities if she participates in such a business
enterprise as an employee, officer, director, consultant, agent, partner,
proprietor, or other participant; provided that the ownership of no more than 2
percent of the stock of a publicly traded corporation engaged in a competitive
business shall not be deemed to be engaging in competitive business activities.
The Executive agrees that she shall not, for a period of one
year from the time her employment under this Agreement ceases (for whatever
reason), or, if later, during any period in which she is receiving monthly
severance payments under Section 5 or Section 6 of this Agreement,
(i) solicit any employee or full-time consultant of the Company for
the purposes of hiring or retaining such employee or consultant, or
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(ii) contact any present or prospective client of the Company to
solicit such a person to enter into a management contract with any
organization other than the Company or a related entity.
For this purpose, the Executive shall be considered to be receiving monthly
severance payments under Section 5 of this Agreement during any period for
which she would be entitled to receive such severance payments.
11. INJUNCTIVE RELIEF
The Executive acknowledges and agrees that it would be
difficult to fully compensate the Company for damages resulting from the breach
or threatened breach of the covenants set forth in Sections 9 and 10 of this
Agreement and accordingly agrees that the Company shall be entitled to
temporary and injunctive relief, including temporary restraining orders,
preliminary injunctions and permanent injunctions, to enforce such provisions
in any action or proceeding instituted in the United States District Court for
the Western District of Florida or in any court in the State of Florida having
subject matter jurisdiction. This provision with respect to injunctive relief
shall not, however, diminish the Company's right to claim and recover damages.
It is expressly understood and agreed that although the
parties consider the restrictions contained in this Agreement to be reasonable,
if a court determines that the time or territory or any other restriction
contained in this Agreement is an unenforceable restriction on the activities
of the Executive, no such provision of this Agreement shall be rendered void
but shall be deemed amended to apply as to such maximum time and territory and
to such extent as such court may judicially determine or indicate to be
reasonable.
12. SEPARABILITY
If any provision of this Agreement shall be declared to be
invalid or unenforceable, in whole or in part, such invalidity or
unenforceability shall not affect the remaining provisions hereof which shall
remain in full force and effect.
13. ASSIGNMENT
This Agreement shall be binding upon and inure to the benefit
of the heirs and representatives of the Executive and the assigns and
successors of the Company, but neither this Agreement nor any rights hereunder
shall be assignable or otherwise subject to hypothecation by the Executive.
14. ENTIRE AGREEMENT
This Agreement represents the entire agreement of the parties
and shall supersede any and all previous contracts, arrangements or
understandings between the Company and the Executive. The Agreement may be
amended at any time by mutual written agreement of the parties hereto.
15. GOVERNING LAW
This Agreement shall be construed, interpreted, and governed
in accordance with the laws of the State of Florida, other than the conflict of
laws provisions of such laws.
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IN WITNESS WHEREOF, the Company has caused this Agreement to
be duly executed, and the Executive has hereunto set her hand, as of the day
and year first above written.
Attest: VISION 21, INC.
/s/ Xxxxxxx X. Xxxxx By /s/ Xxxxxxxx Xxxxxxxx
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Secretary Title: President and CEO
Witness: EXECUTIVE:
/s/ Xxxx Xxxxxxx /s/ Xxxx X. Xxxxxxx
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XXXX X. XXXXXXX
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