XXXXXX X. XXXXXX
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made as of July 1, 1996, by and between Home Health
Corporation of America, Inc. (the "Company"), a Pennsylvania corporation with
its principal office at 0000 Xxxxxxxxxxx Xxxxxxxxx, Xxxx xx Xxxxxxx,
Xxxxxxxxxxxx 00000, and Xxxxxx X. Xxxxxx ("Xxxxxx"), an individual residing at
000 Xxxxxxx Xxxxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxx, 00000. All other agreements
existing prior to July 1, 1996, are null and void.
WITNESSETH:
WHEREAS, the Company is in the business of providing professional care and
equipment to home-bound patients, including, but not limited to, bedside care
and treatment, infusion therapy, and rehabilitative services; and
WHEREAS, Xxxxxx has been employed as a key, at-will executive employee of
the Company;
WHEREAS, Xxxxxx has skillfully and faithfully served as the Company's Chief
Operations Officer of Pennsylvania; and
WHEREAS, the Company desires to secure and retain the experience, ability
and services of Xxxxxx and to increase the responsibilities; and
WHEREAS, in order to retain Xxxxxx'x valued services, the parties now wish
to record and to memorialize their agreement with respect to the terms and
conditions of their employer-employee relationship.
NOW THEREFORE, in consideration of the mutual promises contained herein and
intending to be legally bound, it is hereby agreed:
1. Employment. The Company offers and Xxxxxx accepts employment with the
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Company upon the terms and conditions stated in this Agreement.
2. Duties.
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2.1 Xxxxxx shall serve as the Company's Area Vice President Mid-
Atlantic Area. He shall devote his best efforts and full-time attention to the
performance of his duties on behalf of the Company.
2.2 Xxxxxx shall report directly to the Company's Chief Operations
Officer. He shall be responsible for the Company's operations in the Mid-
Atlantic Area of the United States, and shall undertake such responsibilities
and duties that may be assigned to him from time to time by the Company's Chief
Operations Officer.
2.3 Because Xxxxxx'x full-time services to the Company are deemed
essential, during the term of this Agreement Xxxxxx shall not undertake, outside
the Company, any professional, commercial, business or public activities without
first giving 60 days advance written notice to the Company's President, and not
until he has received authorization and approval from the Company's President to
engage in such outside activities. If the Company disapproves of Xxxxxx
engaging in any additional business, commercial, professional or other outside
responsibilities, then Xxxxxx shall not undertake such activities.
3. Term.
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3.1 Term. The employment of Xxxxxx pursuant to the terms hereof shall
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commence on the date hereof and shall continue until June 30, 1999 and, subject
to paragraph 4.2 below, shall terminate thereafter. The term of Xxxxxx'x
employment hereunder, subject to termination as herein provided, is referred to
herein as the "Initial Term".
4. Termination of Employment. Xxxxxx'x employment hereunder, unless
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renewed by the Company, shall terminate on June 30, 1999, or sooner upon the
occurrence of any of the following events:
4.1 Termination for Death. Xxxxxx'x employment hereunder shall
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automatically terminate upon his death. In the event of termination due to
Xxxxxx'x death pursuant to this paragraph 4.1, Xxxxxx'x right to receive the
compensation and other benefits hereunder, except for payments for services
rendered prior to the date of termination, shall cease.
4.2 Voluntary Termination. Xxxxxx, with ninety (90) days advance
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written notice to the Company, may terminate his employment with the Company for
any or no reason, provided however, Xxxxxx'x obligations under the
Noncompetition, Nondisclosure and Inventions section, contained herein as
Section 7, shall remain in full force and effect in accordance with the terms
thereof. If Xxxxxx shall elect to voluntarily terminate his employment pursuant
to this paragraph 4.2, Xxxxxx'x right to receive the compensation and other
benefits hereunder, except for payments for services rendered prior to the date
of termination, shall cease immediately upon such termination and the Company
shall not be obligated to make any further payments or provide any further
benefits hereunder.
4.3 Termination for Cause. The Company may terminate Xxxxxx'x
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employment for
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Cause (as hereinafter defined), upon written notice to him. For purposes of
this Agreement, "Cause" shall include but not be limited to (i) fraud, personal
dishonesty, willful misconduct, breach of fiduciary duty, willful breach or
willful neglect of the duties or obligations required under this Agreement which
adversely affects the company, (ii) acts or omissions which are intended to and
do have a direct adverse affect upon the Company's reputation or the conduct of
its business or (iii) violation of any law, government rule or regulation by
Xxxxxx which adversely affect the Company. Prior to any termination of this
Agreement by the Company for Cause due to Xxxxxx'x willful misconduct or willful
neglect of duties, the Company shall first advise Xxxxxx in writing of his acts
or omissions which it believes constitutes Cause for termination and to provide
Xxxxxx with a 30 day period to cure such misconduct or neglect, provided this
provision shall only be applicable to the first of any related, series or
similar acts or omissions by him. In the event of termination for cause
pursuant to this paragraph 4.3, Xxxxxx'x right to receive the compensation and
other benefits hereunder, except for payments for services rendered prior to the
date of termination, shall cease immediately upon such termination and the
Company shall not be obligated to make any further payments or provide any
further benefits hereunder; provided, however, Xxxxxx'x obligations under the
Noncompetition Agreement shall remain in full force and effect in accordance
with the terms thereof.
4.4 Termination Without Cause. The Company shall have the right to
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terminate the employment of Xxxxxx at any time without Cause (as defined in
paragraph 4.3 hereof). In the event of termination without Cause pursuant to
this paragraph 4.4, Xxxxxx'x right to receive the compensation and other
benefits hereunder, except for payments for services rendered prior to the date
of termination, shall cease immediately upon such termination but the Company
shall have
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the obligations provided in paragraph 8.
5. Compensation.
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5.1 Base Salary. Effective on July 1, 1996, the company shall pay
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Xxxxxx an annual base salary of $125,000 per annum, payable in semi-monthly
installments or in such other regular installments as the parties agree.
Thereafter, an annual performance/salary review will occur on July 1 of each
year.
5.2 Supplemental Employment Benefits. In addition to the annual base
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salary provided in paragraph 5.1, above, the Company shall also provide to
Xxxxxx the following supplemental employee benefits:
a. Dental Insurance. Xxxxxx shall be eligible to participate in the
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Company's group dental insurance plan.
b. Life Insurance. So long as the Company can purchase life insurance
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at standard rates, the Company shall purchase for Xxxxxx'x benefit an insurance
policy contract on his life in an amount equal to his base salary. Xxxxxx shall
have the right to name, and from time to time, change the beneficiary under said
policy.
c. Automobile Allowance. The Company shall provide to Xxxxxx an
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automobile allowance of $450 a month.
d. Vacation. Xxxxxx shall be entitled an annual vacation accrual
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benefit up to 20 work days a calendar year to be accrued and taken in accordance
with the Company's Employee Manual.
e. Retirement Program. Xxxxxx shall be eligible to participate in the
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Company's Employee Stock Ownership Plan Retirement Program.
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f. 401K Plan. Xxxxxx shall be eligible to participate in the
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Company's Employee Contributory 401K Program.
g. Bonus Program. Xxxxxx shall be eligible to participate in the
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Company's Executive Management Bonus Program during the term of his employment
as Area Vice President-Mid-Atlantic Area or while he is still a member of the
Company's Executive Management Team.
h. Stock Options. Xxxxxx shall be entitled to purchase shares of the
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Company's Stock pursuant to the terms of the stock option program applicable to
senior management.
i. Additional Benefits. The company shall further extend to Xxxxxx
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such additional benefits as may be voluntarily extended to its other employees
on the same terms and conditions as extended to such other employees generally.
6. Confidential Information. Xxxxxx agrees during the term of this
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Agreement not to disclose to any third party any information relating to the
affairs of the Company, or any of its subsidiaries or affiliates, which
information is expressly confidential or which Xxxxxx knows to be secret and not
generally known to others.
7. Noncompetition, Nondisclosure and Inventions.
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7.1 During the period of employment by the Company, Xxxxxx will devote
his full working time and best efforts to the business of the company and agrees
that he will not, directly or indirectly, alone or as a partner, officer,
director, employee or stockholder of any company of business organization,
engage in any business activity which is directly being developed, manufactured
or sold by the Company or which is directly or indirectly detrimental to the
business of the Company provided, however, that the record or beneficial
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ownership by Xxxxxx of 1% or less of the outstanding publicly traded capital
stock of any such company shall not be deemed to be in
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violation of this Section 1, provided that Xxxxxx is not an officer, director,
or employee of such company.
7.2 For a period of one (1) year after the termination of Xxxxxx'x
employment, he agrees that he will not, directly or indirectly, alone or as a
partner, officer, director, employee or stockholder of any company or business
organization, engage in any business activity which is directly or indirectly in
competition with the products or services being developed, manufactured,
marketed, provided or sold by the Company or which is directly or indirectly
detrimental to the business of the Company. Xxxxxx'x obligations under this
Section 7.2 shall survive heirs, executors and administrators if he is
discharged at any time, with cause, or if he resigns at any time. However, if,
at any time, Xxxxxx is discharged without cause, this Section 7.2 shall not
survive the termination of his employment.
7.3 For the purposes of Sections 7.1 and 7.2 of this Agreement, a
business shall be deemed to be in competition with the Company only if the
products or services of such business are substantially similar in function or
capability to the products or services then being developed, manufactured,
marketed, provided or sold by the company, and are marketed to substantially the
same type of user as that to which the products and services of the Company are
marketed or proposed to be marketed.
7.4 Xxxxxx will not at any time, whether during or after the termination
of his employment, reveal to any person, association or company any of the trade
secrets or confidential information concerning the organization, business or
finances of the Company so far as they have come or may come to his knowledge,
except as my be required in the ordinary course of performing duties as an
employee of the Company or except as may be in the public domain
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through no fault of Xxxxxx, and he shall keep secret all matters entrusted to
him and shall not use or attempt to use any such information in any manner which
may injure or cause loss or may be calculated to injure or cause loss whether
directly or indirectly to the Company.
Further, Xxxxxx agrees that during his employment he shall not make, use or
permit to be used any notes, memoranda, drawings, specifications, programs, data
or other materials of any nature relating to any matter within the scope of the
business of the Company or concerning any of its dealings or affairs otherwise
than for the benefit of the Company. Xxxxxx further agrees that he shall not,
after the termination of his employment, use or permit to be used any such
notes, memoranda, drawings, specifications, programs, data or other materials,
it being agreed that any of the foregoing shall be and remain the sole and
exclusive property of the Company and that immediately upon the termination of
his employment Xxxxxx shall deliver all of the foregoing, and all copies
thereof, to the Company, at its main office.
7.5 If at any time or times during Xxxxxx'x employment, he shall (either
alone or with others) make, conceive, discover, reduce to practice or become
possessed of any invention, modification, discovery, design, development,
improvement, process, formula, data, technique, know-how, secret or intellectual
property right whatsoever or any interest therein (whether or not patentable or
registrable under copyright or similar statutes or subject to analogous
protection) (herein called "Inventions") that relates to the business of the
Company or any of the products or services being developed, manufactured or sold
by the Company or which may conveniently be used in relation therewith, or
results from tasks assigned me by the Company or results from the use of
premises owned, leased or contracted for by the Company, such Inventions and the
benefits thereof shall immediately become the sole and absolute property of the
Company, and Xxxxxx shall
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promptly disclose to the Company (or any persons designated by it) each such
Invention and hereby assign any rights he may have or acquire in the inventions
and benefits and/or rights resulting therefrom to the Company without
compensation and shall communicate, without cost or delay, and without
publishing the same all available information relating thereto (with all
necessary plans and models) to the Company.
Xxxxxx will also promptly disclose to the Company, and the Company hereby
agrees to receive all such disclosures in confidence, any other invention,
modification, discovery, design, development, improvement, process, formula,
data, technique, know-how, secret or intellectual property right whatsoever or
any interest therein (whether or not patentable or registrable under copyright
or similar statutes or subject to analogous protection) made, conceived,
discovered, reduced to practice or possessed by Xxxxxx (either alone or with
others) at any time or times during his employment for the purpose of
determining whether they constitute "Inventions", as defined herein.
Upon disclosure of each Invention to the Company, during Xxxxxx'x
employment and at any time thereafter, he will, at the request and cost of the
Company, sign, execute, make and do all such deeds, documents, acts and things
as the Company and its duly authorized agents may reasonably require
(a) to apply for, obtain and vest in the name or the Company alone
(unless the Company otherwise directs) letters patent, copyrights or other
analogous protection in any country throughout the world and when so obtained or
vested to renew and restore the same; and
(b) to defend any opposition proceedings in respect of such
applications and any opposition proceedings or petitions or applications for
revocation of such letters patent, copyright
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or other analogous protection.
In the event the Company is unable, after reasonable effort, to secure
Xxxxxx'x signature on any letters patent, copyright or other analogous
protection relating to an Invention, whether because of his physical or mental
incapacity or for any other reason whatsoever, I hereby irrevocably designate
and appoint the Company and its duly authorized officers and agents as Xxxxxx'x
agent and attorney-in-fact, to act for and in his behalf and stead to execute
and file any such application or applications and to do all other lawfully
permitted acts to further the prosecution and issuance of letters patent,
copyright or other analogous protection thereon with the same legal force and
effect as if executed by Xxxxxx.
7.6 Xxxxxx agrees that any breach of the Agreement by him could cause
irreparable damage and that in the event of such breach the Company shall have,
in addition to any and all remedies of law, the right to an injunction, specific
performance or other equitable relief to prevent the violation of my obligations
hereunder.
7.7 Xxxxxx understands that this Agreement does not create an obligation
on the Company or any other person to continue his employment.
Xxxxxx further represents that his performance of all the terms of this
Agreement, and his performance as an employee of the Company, does not and will
not breach any agreement to keep in confidence proprietary information acquired
by him in confidence or in trust prior to his employment by the Company. Xxxxxx
has not entered into, and he agrees he will not enter into, any agreement either
written or oral in conflict herewith.
Xxxxxx further represents that if the representations set forth in the
preceding paragraph are inapplicable, he has attached hereto a copy of each
agreement, if any, which presently affects his
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compliance with the terms of this Agreement. (Such copy specifies the other
contracting party or employer, the date of such agreement, the date of
termination of any employment.) IF THERE ARE ANY SUCH AGREEMENTS, THE
UNDERSIGNED SHOULD INITIAL HERE. OTHERWISE IT WILL BE DEEMED THAT THERE ARE NO
SUCH AGREEMENTS. ___________.
7.8 Any waiver by the Company of a breach of any provisions of this
Agreement shall not operate or be construed as a waiver of any subsequent breach
hereof.
7.9 Xxxxxx hereby agrees that each provision herein shall be treated as
a separate and independent clause, and the unenforceability of any one clause
shall in no way impair the enforceability of any of the other clauses herein.
Moreover, if one or more of the provisions contained in this Agreement shall for
any reason be held to be excessively broad as to scope, activity or subject so
as to be unenforceable at law, such provision or provisions shall be construed
by the appropriate judicial body by limiting and reducing it or them, so as to
be enforceable to the extent compatible with the applicable law as it shall then
appear.
7.10 Subject to the provisions of paragraph 2 of this section, Xxxxxx'x
obligations under this Agreement shall survive the termination of his employment
regardless of the manner of such termination and shall be binding upon his
heirs, executors and administrators.
7.11 The term "Company" shall include Home Health Corporation of
America, Inc., a Pennsylvania corporation, and any of its subsidiaries,
subdivisions or affiliates. The Company may not assign this Agreement to any
successor or assign without my written consent.
7.12 For purposes of this Agreement (other than Section 1), the term
"employment" shall also mean any period of consultancy with the Company.
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8. Severance Payments.
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8.1 If Xxxxxx'x employment hereunder is terminated by the Company
without Cause pursuant to paragraph 4.5, then the Company shall continue to pay
Xxxxxx his regular base salary payable under paragraph 5.1 for a period of
twelve (12) months following the effective date of the termination of his
employment. Xxxxxx shall not be required to mitigate the amount of any payment
required to be made under this paragraph 8.1 by seeking other employment or
otherwise, but if Xxxxxx does obtain other employment, the amount of
compensation received from such other employment source during the period that
the Company is required to continue paying Xxxxxx his base salary shall reduce
on a dollar-for-dollar basis the amount otherwise required to be paid by the
Company hereunder.
Any compensation payable under this paragraph 8.1 shall be payable when
such compensation would otherwise have been paid had this Agreement not been
terminated. Any sums payable under this paragraph 8.1 shall be paid only so
long as Xxxxxx is not in breach of any of the covenants contained in the
Noncompetition Agreement.
9. Consolidation of Merger. In the event of any consolidation or merger
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of the Company with another corporation or other business entity or the sale of
all or substantially all of the Company's assets to another entity, as a result
of which the Company is not the surviving entity, the surviving entity shall
assume this Agreement and shall become obligated to perform all the terms and
conditions contained herein.
10. Notices. Any notice required or desired to be given under this
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agreement shall be deemed given if given in writing and sent by certified and
registered mail, return receipt requested to:
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To Home Health Corporation of America, Inc.
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0000 Xxxxxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxx xx Xxxxxxx, XX 00000
11. Benefit of Agreement; Assignment.
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11.1 This Agreement and all rights hereunder shall be binding upon and
shall inure to the benefit of the parties hereto and to their personal
representatives, successors and permitted assigns.
11.2 Neither party hereto may assign this Agreement or any rights
hereunder, except that the Company, in its discretion may assign this Agreement
or any of its rights hereunder to any successor in interest to all or
substantially all of the business or assets of the Company or to any subsidiary
or affiliate, but that no such assignment shall relieve the Company of its
obligations hereunder; and further provided that no such assignment shall be
valid unless the assignee expressly assumes in writing all of the obligations to
be performed by the Company hereunder.
12. Governing Law. This Agreement shall be governed by, construed and
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enforced in accordance with the laws of the Commonwealth of Pennsylvania.
13. No Waiver. Either party's failure to strictly enforce any provision
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of this Agreement shall not be construed as a waiver thereof or excusing either
party from future performance.
14. Severability and Enforceability. The invalidity of any provision of
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this Agreement shall not invalidate any other part. If any provision of this
Agreement is not enforced or is found invalid because it is too vague or broad
in any respect, then to the extent that a court of competent jurisdiction deems
such provision to be valid and enforceable, the Agreement shall be valid and
enforced as though the vague or overly broad portion had been modified by
agreement of the parties in accordance with any interpretation given by the
court.
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15. Headings. The paragraph headings set forth in this Agreement are for
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reference purposes only and shall not be considered as part of this Agreement in
any respect or shall in any way effect the substance of any provision contained
in this Agreement.
16. Mediation Prior to Litigation. Neither party hereto shall initiate
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litigation with respect to any claim, demand, dispute, controversy, difference
or misunderstanding whatsoever between or among them relating to this Agreement
without first engaging in at least twelve hours of good faith mediation before
an impartial mediator to be selected by the parties. The cost of mediation
shall be equally shared by both parties. In the event the parties are unable to
select a mediator within thirty days of their dispute, then the parties shall
select a mutually acceptable Alternative Dispute Resolution Service, and failing
agreement upon such a service, then the American Arbitration Association in
Philadelphia, Pennsylvania, to appoint a trained and experienced mediator.
During mediation, the parties will make a good faith attempt to resolve their
dispute.
17. Entire Agreement. This Agreement contains the entire understanding
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between the parties with regard to the employment and compensation matters
described herein and may not be altered, amended, or modified except by a
writing signed by both parties hereto.
IN WITNESS WHEREOF, the parties hereto set their hands and seals.
HOME HEALTH CORPORATION OF
AMERICA, INC.
By:
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Xxxxxx X. Xxxxxx
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