Exhibit 10.3
SEPARATION AND SEVERANCE AGREEMENT
This Separation and Severance Agreement (the "Agreement") is
made and entered into as of May 30, 2003 by and between Xxxxx X. Xxxxxx
("Executive") and PEDIATRIX MEDICAL GROUP, INC. (the "Company").
WHEREAS, Executive and the Company are parties to an Amended
and Restated Employment Agreement dated as of January 1, 2003 (the "Employment
Agreement"), under which the Executive agreed to serve the Company as Executive
Vice President, Corporate Development and General Counsel;
WHEREAS, the Company and Executive desire to enter into an
agreement that sets forth their respective remaining obligations under the
Employment Agreement and the terms and timing of the termination of Executive's
services pursuant to and under the terms of the Employment Agreement; and
WHEREAS, the parties acknowledge that Executive has valuable
knowledge, expertise and confidential information about the Company's business
and business relationships.
NOW, THEREFORE, in consideration of the mutual promises and
agreements contained herein, the adequacy and sufficiency of which are hereby
acknowledged, Executive and the Company agree as follows:
1. The Company and Executive hereby mutually acknowledge and
agree that the Employment Agreement shall terminate pursuant to, and in
accordance with, the terms of Section 4.7 thereof, with said termination to be
effective as of 11:59 p.m. on June 4, 2003 (the "Termination Date").
2. In full and final settlement of any claims for severance
compensation, or for any other amounts owing to Executive under the Employment
Agreement (including any bonus amounts) or otherwise (other than reimbursement
of business expenses paid or otherwise incurred by the Executive prior to the
Termination Date and any amounts payable to Executive pursuant to the terms of
the CSA (as defined in Paragraph 3 below)), consistent with the terms of Section
5.4 of the Employment Agreement, the Company agrees as follows:
(a) For a period of 12 months following the Termination Date,
the Company shall make payments to Executive at an annual rate
of Three Hundred Thousand Dollars ($300,000), with such
amounts to be prorated as necessary and payable in
installments consistent with the Company's normal payroll
schedule, subject to required applicable withholding for
taxes;
(b) Through June 30, 2004, Executive shall be eligible to
continue to participate in the Company's group health
insurance plan, and all other Company benefit plans or
policies (other than equity compensation or bonus plans), in
each case on the same terms and subject to the same conditions
available to Executive prior to the Termination Date; and
(c) Beginning on July 1, 2004, participation in the Company's
group health insurance plan shall be governed by the
Consolidated Omnibus Budget Reconciliation Act of 1985
("COBRA"), and Executive's participation in any of the
Company's other benefit plans or policies, if any, shall be
governed by the terms and conditions of any such plans or
policies, or as otherwise required by law.
Consistent with the terms and conditions of the Company's Amended and Restated
Stock Option Plan, Executive shall have a period of ninety (90) days following
the Termination Date in which to exercise any options to purchase common stock
that are vested and unexercised as of the Termination date; any such options
that are unvested shall terminate and become null and void as of the Termination
Date.
3. Following termination of the Employment Agreement as
described in Paragraph 1 above, at the request of the Company, Executive has
agreed to provide consulting services as an independent contractor to the
Company, with such services to be provided on the terms and subject to the
conditions set forth in that certain Consulting Services Agreement by and
between the Company and Executive of even date herewith (the "CSA"). The Company
expressly acknowledges and agrees that any payments or compensation pursuant to
the Consulting Services Agreement shall be separate from, in addition to, and
shall not offset, any of the Company's obligations under Paragraph 2 above.
4. The term "Released Parties" includes the Company and its
parents, divisions, subsidiaries, partnerships, affiliates, and other related
entities, and each of their past, present, and future owners, fiduciaries,
shareholders, directors, officers, partners, agents, employees, executives, and
attorneys, whether in their individual or professional capacities, and the
predecessors, successors, and assigns of each of them.
5. Executive, and anyone claiming through Executive, agrees
not to xxx and further agrees to release the Released Parties, with respect to
any and all claims which Executive now has or has ever had, or may ever have,
against any of the Released Parties, arising from conduct or omissions through
the effective date of this Agreement, whether known or unknown, including but
not limited to: (a) claims for or related in any way to the Employment Agreement
or Executive's employment, hiring, conditions of employment, compensation or
payment of compensation, or termination from employment; (b) claims that could
have been asserted by or on behalf of Executive in any federal, state, or local
court, commission, or agency, or under any common law theory, or under any
employment, contract, tort, federal, state, or local law, regulation, ordinance,
or order; and (c) claims arising under federal, state, or local laws, as amended
from time to time, including, but not limited to, Title VII of the Civil Rights
Act of 1964 (as amended), the Civil Rights Act of 1991, the Americans with
Disabilities Act, the Age Discrimination in Employment Act of 1967 ("ADEA"), as
amended, the Employee Retirement Income Security Act of 1974, Family and Medical
Leave Act of 1993, the Older Workers Benefits Protection Act, or other federal,
state or local civil rights laws based on age or other protected class status.
6. Executive agrees, represents, and warrants that Executive
is the sole owner of the claims that are released in this Agreement and that
Executive has the full right and power to grant, execute, and deliver the
releases and promises in this Agreement. Executive further agrees, represents
and warrants that Executive has not initiated or filed any legal, equitable,
administrative, or any other proceeding against any of the Released Parties and
that no such proceeding has been initiated or filed on Executive's behalf. The
consideration offered herein is accepted by Executive as being in full accord,
satisfaction, compromise and settlement of any and all claims or potential
claims, and Executive expressly agrees that Executive is not entitled to and
shall not receive any further recovery of any kind from the Company or any of
the Released Parties, and that in the event of any further proceedings
whatsoever based upon any matter released herein, the Company and each of the
Released Parties shall have no further monetary or other obligation of any kind
to Executive, including any obligation for any costs, expenses and attorneys'
fees incurred by or on behalf of Executive.
7. Executive recognizes and acknowledges that the Company's,
its affiliates', their divisions' and the users of their services' ("users")
confidential financial records, financial and other plans, marketing methods and
systems, advertising strategies and methods, strategic plans, databases, trade
secrets, user lists, information regarding users and potential users, staff
members, or suppliers, reports prepared by consultants, other information,
observations, data and ideas obtained by Executive during the course of
Executive's employment with the Company, or other proprietary information of the
Company (collectively referred to as "Confidential Information"), are valuable,
special, and unique assets of the Company and these affiliates, divisions, and
users. Therefore, Executive agrees not to disclose at all times any Confidential
Information to any person, firm, corporation, or other entity whatsoever unless
and until the information becomes generally available to the public through
proper means not in violation of this Agreement.
8. Nothing in this Agreement is intended to or shall be
construed as an admission by the Company or any of the other Released Parties
that it violated any law, interfered with any right or otherwise engaged in any
improper or illegal conduct with respect to Executive or otherwise, the Released
Parties expressly denying any such illegal or improper conduct.
9. Nothing contained in this Agreement is intended to waive,
alter or modify in any manner the duties and obligations of Executive as
Authorized House Counsel to the Company, including those duties and obligations
involving the attorney client privilege, confidentiality, work product or any
other duty or obligation imposed on a lawyer by the rules and regulations of the
Florida Bar or applicable law.
10. To the fullest extent permissible under applicable law and
the Company's Articles of Incorporation, the Company hereby indemnifies and
saves harmless Executive from and against any liability he may suffer or incur
as a result of, or incident to, any act or omission during the course of, or
incident to, his services to the Company, said indemnification to include
advancement of, and reimbursement for, any reasonable expenses incurred by
Executive in defense of any claims that may be asserted in connection with, or
as a result of, his services to, or on behalf of, the Company.
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11. In the event that a legal action is brought to enforce the
terms of this Agreement, the prevailing party shall be entitled to recover his
or its costs of court, including all attorneys' fees at all trial and appellate
levels.
12. Executive acknowledges and agrees that (i) he has been
provided sufficient time to review this Agreement, (ii) he has had the
opportunity to consult with legal counsel if he so chooses, and (iii) he has
received all of the information he requires from the Company to make a knowing
and voluntary release and waiver of all claims against the Company.
13. The Company and Executive hereby mutually agree that each
shall refrain from any conduct, verbal or otherwise, that criticizes, ridicules,
disparages or is derogatory of the other, and, in the case of the Company, of
its affiliates or any of its or their officers, directors, agents or employees.
Additionally, during the one-year period immediately following the Termination
Date, except as authorized by the Company, Executive shall not give any
interviews or speeches concerning the Company, nor shall Executive directly or
indirectly, prepare or assist any person or entity in the preparation of any
books, articles, or other creations concerning the Company. Notwithstanding the
foregoing, (i) Executive may publicly state factual information about his
employment with Company in providing others with background and resume
information about himself, in public filings with the Securities and Exchange
Commission when required with respect to other issuers for which such disclosure
about him is required, and in similar contexts and (ii) in the event that
Executive is legally compelled (by oral questions, interrogatories, requests for
information or documents, subpoena, investigative demand or similar process) to
respond to inquiries concerning the Company, the restrictions on communications
set forth in this Paragraph 13 shall not apply to such compulsory requests.
Should any such compulsory requests for information be received, Executive
hereby agrees to cooperate with the Company and its counsel in the course of
responding thereto.
14. This Agreement embodies the entire agreement and
understanding of the parties hereto with regard to Sections 4 (Termination) and
5 (Compensation and Benefits Upon Termination) of the Employment Agreement, and
supersedes any and all prior and/or contemporaneous agreements and
understandings (other than the CSA), oral or written, between said parties with
respect thereto, including, but not limited to, the Employment Agreement. Except
to the extent that such agreements and obligations have been expressly modified
or changed herein, nothing contained herein is intended, nor shall it be
construed, to limit or restrict any of the parties' other respective agreements
and obligations under the Employment Agreement, including, but not limited to,
Executive's obligations under Section 8 of the Employment Agreement
(Noncompetition;Unauthorized Disclosure;Injunctive Relief), which obligations
remain in effect and enforceable against the parties hereto.
15. This Agreement shall be construed and interpreted in
accordance with the laws of the State of Florida.
16. The fact that one of the parties may have drafted or
structured any provision of this Agreement or any document referenced herein
shall not be considered in construing the particular provision or document
either in favor of or against such party.
17. The parties agree that this Agreement may be modified only
in writing, and any party's failure to enforce this Agreement in the event of
one or more events that violate this Agreement shall not constitute a waiver of
any right to enforce this Agreement against subsequent violations.
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THE PARTIES STATE THAT THEY HAVE READ THE FOREGOING, THAT THEY
UNDERSTAND EACH OF ITS TERMS AND THAT THEY INTEND TO BE BOUND THERETO.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first above written.
PEDIATRIX MEDICAL GROUP, INC. EXECUTIVE:
/s/ XXXXX X. XXXXX, M.D., M.B.A. /s/ XXXXX X. XXXXXX
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Xxxxx X. Xxxxx, M.D., M.B.A. Xxxxx X. Xxxxxx
President and CEO
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