EXHIBIT 10.6
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT is made and entered into
as of December 17, 1998 between LIFE USA HOLDING, INC., a Minnesota corporation
(the "Company"), and XXXXXX X. XXXXX (the "Executive").
RECITALS
WHEREAS, the Executive entered into an Employment Agreement dated as of
January 1, 1998 (the "Employment Agreement"), providing the terms and conditions
for continued employment of the Executive by the Company, including without
limitation the service of the Executive as the Senior Vice President and
Director of Sales of the Company and the President of LifeUSA Insurance Company,
the Company's subsidiary ("LifeUSA");
WHEREAS, the Company's subsidiary, LifeUSA Insurance Company, has
formed a new subsidiary, LTCAmerica Holding, Inc., a Minnesota corporation
("LTCA"), for the purpose of offering life insurance, annuity products and
health insurance; and
WHEREAS, LifeUSA wishes to make the services of the Executive available
to LTCA and its subsidiaries, permit assignment of the Employment Agreement to
LTCA, provide for the repurchase by LTCA of the securities of LTCA purchased by
the Executive in the event the Executive dies or is disabled, voluntarily
terminates his employment or is terminated for Cause and confirm noncompete and
nonsolicitation agreements,
NOW, THEREFORE, in consideration of the mutual premises and agreements
set forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Performance of Duties for LTCA. The parties desire that the
Executive provide services to LTCA as the President and Chief Executive Officer
of LTCA, with the duties and responsibilities attendant to such position, and
that the Executive provide services to subsidiaries of LTCA as agreed upon
between the Executive and LTCA. So long as the Executive provides services to
LTCA or its subsidiaries, the salary, other compensation and benefits provided
in the Agreement shall be reimbursed by LTCA in accordance with the Employee
Leasing Agreement between the Company and LTCA, until such time as the
Employment Agreement is assigned to LTCA pursuant to paragraph 7 hereof.
2. Term of Employment. The term of the Employment Agreement is hereby
extended to December 31, 2003, automatically extendable as provided in paragraph
2 of the Employment Agreement commencing December 31, 1999.
3. Modification of Paragraph 4(c) of the Employment Agreement.
Paragraph 4(c), clause (i) of the Employment Agreement is hereby amended to read
as follows: "...the Executive is not at all times a duly elected executive
officer of the Company or a Subsidiary...."
4. Modification of Paragraph 4(d) of the Employment Agreement.
Paragraph 4(d) of the Employment Agreement is hereby modified to add the
following two sentences thereto:
"The Executive may voluntarily terminate his employment without Good
Reason prior to the expiration of the term of this Agreement by giving
the Company at least sixty (60) days prior written notice or such
shorter period of time as the Company's Board of Directors may
determine. In the event the Executive voluntarily resigns, the
Executive's rights to further Base Salary payments and the Annual Bonus
(to the extent not yet earned) shall terminate on the effective date of
such resignation, and the Executive's rights to other compensation and
benefits shall be determined under the Company's benefit plans and
policies applicable to executives of the Company then in effect."
5. LTCA Stock Buyback. In connection with the formation of LTCA and the
execution of this First Amendment to Employment Agreement, the Executive is
purchasing 400,000 shares of common stock of LTCA (the "Shares"). The Executive
agrees that he will not transfer the Shares or any right or interest therein
without the prior written consent of LTCA. In the event of the Executive's death
or disability (as defined in the Company's long term disability plan then in
effect), in the event the Executive voluntarily terminates his employment, or in
the event the Executive is terminated for Cause pursuant to Section 4(b) of the
Employment Agreement, the Executive acknowledges that LTCA may, but is not
obligated to, repurchase the Shares from the Executive at a price of ten cents
($.10) per share plus interest on the original purchase price of the Shares from
the date of purchase at the rate of ten percent 10% per annum (the "purchase
price"). In order to exercise its option to repurchase, LTCA must give notice of
its intention to the Executive within sixty (60) days of the event giving rise
to the repurchase option (or within one hundred twenty (120) days after the
death or disability of the Executive) and purchase the Shares within thirty (30)
days of giving such notice. The right of LTCA to repurchase the Shares pursuant
to this paragraph 5 shall terminate on December 31, 2001.
6. Confidentiality, Nonsolicitation and Noncompete Covenants. Without
limiting paragraph 5 of the Employment Agreement, the Executive acknowledges
that the covenants of the Executive in paragraph 5 of the Employment Agreement
extend in every respect to include LTCA and its subsidiaries and are enforceable
by LTCA and its subsidiaries.
7. Assignability. In the event that it is determined between LTCA and
the Company that the Executive should be a direct employee of LTCA, the
Employment Agreement shall be amended to reflect that relationship (including
without limitation the assumption by LTCA of the Company's obligations under
paragraphs 3 and 4 of the Employment Agreement) Company's obligations under
paragraphs 3 and 4 of , provided that the obligations of the Executive to the
Company under paragraph 5 of the Employment Agreement and the rights of the
parties in the event of a dispute with respect to such obligations shall
continue to be binding on the parties for so long as such obligations and rights
exist between LTCA and the Executive in accordance with the Employment
Agreement.
8. Notices. Any notice required to be given to LTCA shall be given to
its corporate headquarters, attention of the Secretary.
2
9. Successors. The Company's rights under the Employment Agreement
shall inure to the benefit of, and be enforceable by, the Company and its
Subsidiaries (including without limitation LTCA) and the successors and assigns
of any of them.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the day and year first written above.
LIFE USA HOLDING, INC.
By /s/ Xxxxxx X. XxxXxxxxx
-----------------------------
Xxxxxx X. XxxXxxxxx, Chairman
and Chief Executive Officer
/s/ Xxxxxx X. Xxxxx
--------------------------------
Xxxxxx X. Xxxxx
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT is made and entered into
as of December 17, 1998 between LIFE USA HOLDING, INC., a Minnesota corporation
(the "Company"), and XXXXXXX X. XXXXX (the "Executive").
RECITALS
WHEREAS, the Executive entered into an Employment Agreement dated as of
January 1, 1998 (the "Employment Agreement"), providing the terms and conditions
for continued employment of the Executive by the Company, including without
limitation the service of the Executive as the Senior Vice President-Finance of
the Company;
WHEREAS, the Company's subsidiary, LifeUSA Insurance Company, has
formed a new subsidiary, LTCAmerica Holding, Inc., a Minnesota corporation
("LTCA"), for the purpose of offering life insurance, annuity products and
health insurance; and
WHEREAS, the Company wishes to make the services of the Executive
available to LTCA and its subsidiaries, permit assignment of the Employment
Agreement to LTCA, provide for the repurchase by LTCA of the securities of LTCA
purchased by the Executive in the event the Executive dies or is disabled,
voluntarily terminates his employment or is terminated for Cause and confirm
noncompete and nonsolicitation agreements,
NOW, THEREFORE, in consideration of the mutual premises and agreements
set forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Performance of Duties for LTCA. The parties desire that the
Executive provide services to LTCA as the Chairman and Chief Financial Officer
of LTCA, with the duties and responsibilities attendant to such position, and
that the Executive provide services to subsidiaries of LTCA as agreed upon
between the Executive and LTCA. So long as the Executive provides services to
LTCA or its subsidiaries, the salary, other compensation and benefits provided
in the Agreement shall be reimbursed by LTCA in accordance with the Employee
Leasing Agreement between the Company and LTCA, until such time as the
Employment Agreement is assigned to LTCA pursuant to paragraph 7 hereof.
2. Term of Employment. The term of the Employment Agreement is hereby
extended to December 31, 2003, automatically extendable as provided in paragraph
2 of the Employment Agreement commencing December 31, 1999.
3. Modification of Paragraph 4(c) of the Employment Agreement.
Paragraph 4(c), clause (i) of the Employment Agreement is hereby amended to read
as follows: "...the Executive is not at all times a duly elected executive
officer of the Company or a Subsidiary...."
4. Modification of Paragraph 4(d) of the Employment Agreement.
Paragraph 4(d) of the Employment Agreement is hereby modified to add the
following two sentences thereto:
"The Executive may voluntarily terminate his employment without Good
Reason prior to the expiration of the term of this Agreement by giving
the Company at least sixty (60) days prior written notice or such
shorter period of time as the Company's Board of Directors may
determine. In the event the Executive voluntarily resigns, the
Executive's rights to further Base Salary payments and the Annual Bonus
(to the extent not yet earned) shall terminate on the effective date of
such resignation, and the Executive's rights to other compensation and
benefits shall be determined under the Company's benefit plans and
policies applicable to executives of the Company then in effect."
5. LTCA Stock Buyback. In connection with the formation of LTCA and the
execution of this First Amendment to Employment Agreement, the Executive is
purchasing 400,000 shares of common stock of LTCA (the "Shares"). The Executive
agrees that he will not transfer the Shares or any right or interest therein
without the prior written consent of LTCA. In the event of the Executive's death
or disability (as defined in the Company's long term disability plan then in
effect), in the event the Executive voluntarily terminates his employment, or in
the event the Executive is terminated for Cause pursuant to Section 4(b) of the
Employment Agreement, the Executive acknowledges that LTCA may, but is not
obligated to, repurchase the Shares from the Executive at a price of ten cents
($.10) per share plus interest on the original purchase price of the Shares from
the date of purchase at the rate of ten percent 10% per annum (the "purchase
price"). In order to exercise its option to repurchase, LTCA must give notice of
its intention to the Executive within sixty (60) days of the event giving rise
to the repurchase option (or within one hundred twenty (120) days after the
death of the Executive) and purchase the Shares within thirty (30) days of
giving such notice. The right of LTCA to repurchase the Shares pursuant to this
paragraph 5 shall terminate on December 31, 2001.
6. Confidentiality, Nonsolicitation and Noncompete Covenants. Without
limiting paragraph 5 of the Employment Agreement, the Executive acknowledges
that the covenants of the Executive in paragraph 5 of the Employment Agreement
extend in every respect to include LTCA and its subsidiaries and are enforceable
by LTCA and its subsidiaries.
7. Assignability. In the event that it is determined between LTCA and
the Company that the Executive should be a direct employee of LTCA, the
Employment Agreement shall be amended to reflect that relationship (including
without limitation the assumption by LTCA of the Company's obligations under
paragraphs 3 and 4 of the Employment Agreement), provided that the obligations
of the Executive to the Company under paragraph 5 of the Employment Agreement
and the rights of the parties in the event of a dispute with respect to such
obligations shall continue to be binding on the parties for so long as such
obligations and rights exist between LTCA and the Executive in accordance with
the Employment Agreement.
8. Notices. Any notice required to be given to LTCA shall be given to
its corporate headquarters, attention of the Secretary.
2
9. Successors. The Company's rights under the Employment Agreement
shall inure to the benefit of, and be enforceable by, the Company and its
Subsidiaries (including without limitation LTCA) and the successors and assigns
of any of them.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the day and year first written above.
LIFE USA HOLDING, INC.
By /s/ Xxxxxx X. XxxXxxxxx
-----------------------------
Xxxxxx X. XxxXxxxxx, Chairman
and Chief Executive Officer
/s/ Xxxxxxx X. Xxxxx
--------------------------------
Xxxxxxx X. Xxxxx
