Exhibit 10.52
CEO Form
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into effective as
of __________ __, 19__ by and between GRANCARE, INC., a Delaware corporation
("Company" or "GranCare"), and ___________________________ ("Employee").
WHEREAS, the Employee has previously entered into an employment
agreement dated _____________________, 199_ (the "Prior Employment Agreement")
with GranCare, Inc., a California corporation ("Old GranCare"); and
WHEREAS, Old GranCare has distributed to its shareholders all the
issued and outstanding equity securities of the Company; and
WHEREAS, the Company desires to employ the Employee on the condition
that the Employee releases Old GranCare of its obligations under the Prior
Employment Agreement, including the obligation to pay the Employee certain
payments relating to the Employee's termination of employment with Old GranCare;
and
WHEREAS, the Employee wishes to accept such employment with the
Company and to release Old GranCare from any obligations under and waive any
benefits from the Prior Employment Agreement; and
WHEREAS, the Company desires to recognize the right of the Employee to
certain employment, compensation and severance benefits; and
WHEREAS, to attain that end the Company and the Employee wish to enter
into this Employment Agreement which shall replace the Prior Employment
Agreement.
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NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, and other good and valuable consideration, the Company and the
Employee do hereby agree as follows:
1. Employment. The Company hereby employs Employee and Employee
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hereby accepts employment by the Company on the terms and conditions set forth
in this Agreement.
2. Term of Employment. Subject to the provisions for earlier
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termination provided herein, the term of this Agreement (the "Term" or
"Employment Period") shall commence on the effective date hereof and shall
terminate on December 31, 19__; provided, however, that unless written notice to
the contrary has been given to Employee by the Board of Directors of the Company
(the "Board") the commencement date of a new three (3) year term of this
Agreement shall begin on the first day of January of each succeeding year.
3. Employee's Duties. During the Term, Employee shall serve as
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President and Chief Executive Officer of the Company, with such customary duties
and responsibilities as may from time to time be assigned to him by the Board of
Directors of the Company, provided that such duties are at all times consistent
with the duties of such position.
Employee agrees to devote his full attention and time during normal
business hours to the business and affairs of the Company and, to the extent
necessary, to discharge the duties and responsibilities assigned to Employee
hereunder, to use reasonable best efforts to perform faithfully and efficiently
such duties and responsibilities; provided, however, that Employee may (i) serve
on corporate, civic or charitable boards or
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committees, and (ii) deliver lectures and fulfill speaking engagements, so long
as such activities do not materially interfere with the performance of
Employee's duties and responsibilities hereunder.
4. Compensation. For services rendered by Employee pursuant to this
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Agreement, the Company shall pay to Employee a base salary ("Base
Compensation'') of $________ per annum payable in accordance with the Company's
customary practices for its officers. The amount of Base Compensation shall be
reviewed by the Board on at least an annual basis and may be increased to
reflect inflation or such other adjustments as the Board may deem appropriate
but Base Compensation, as increased, may not be decreased.
In addition to the Base Compensation, Employee may be awarded, for
each fiscal year of the Company ending with or within the Term, an annual bonus
("Bonus"), whether pursuant to a formal bonus or incentive plan or program of
the Company or otherwise, in cash or other property acceptable to Employee,
including stock options, rights or warrants in the Company, which Bonus shall be
based on such criteria as deemed appropriate and adopted by the Board. If
earned, the Bonus shall be paid to Employee within ninety (90) days after the
end of each fiscal year, except to the extent, if any, that Employee shall have
otherwise elected to defer all or part of the receipt of such Bonus.
Employee shall be eligible to receive during the Employment Period one
or more stock option grants under the Company's stock option plans upon such
terms and conditions as the plan administrator may deem appropriate.
The Company shall deduct and withhold, from the compensation payable
to Employee hereunder, any and all applicable Federal, state and local income
and
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employment withholding taxes and any other amounts required to be deducted or
withheld by the Company under applicable statute or regulation.
5. Additional Benefits. In addition to the Base Compensation and
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Bonus provided for in Section 4 herein, Employee shall be entitled to receive:
(a) All fringe benefits customarily offered by the Company to its
President and Chief Executive Officer including, without limitation, vacation,
club memberships, expense accounts, automobile allowance, participation in any
Company stock compensation plan and the various employee benefit plans or
programs provided to the employees of the Company in general, subject to the
eligibility requirements with respect to each of such benefit's plans or
programs, and to such other benefits or prerequisites as may be approved by the
Board during the Term.
(b) Reimbursement from the Company for all customary, ordinary and
necessary business expenses reasonably incurred by Employee in the performance
of his duties hereunder, provided Employee furnishes the Company with vouchers,
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receipts and other substantiation of such expenses within thirty (30) days after
they are incurred.
(c) Employee shall accrue paid vacation benefits during the Term in
accordance with the Company policy in effect for executive officers. Employee
may take the accrued vacation at such times during each fiscal year as are
mutually convenient to Employee and the Company. All unused vacation shall
automatically be forfeited at the end of each year.
6. Indemnification. To the maximum extent permitted by law, the
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Company hereby indemnifies Employee and agrees to hold Employee harmless from
any costs or expenses incurred by him on account of the fact he becomes a party,
or is threatened to be
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made a party, to any threatened, pending or contemplated action, suit or
proceeding, whether civil, criminal, administrative or investigative by reason
of the fact that he is or was or becomes a director, officer, employee or agent
of the Company or any parent or subsidiary of the Company. Such costs and
expenses shall include, without limitation, expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding. To the
maximum extent permitted by and subject to any requirements of law, expenses
incurred by Employee in defending a civil or criminal action, suit or proceeding
shall be paid by the Company as bills for such services are presented by
Employee to the Company. In any such matter, Employee shall be entitled to
select his own counsel.
To the maximum extent provided by law, the Company shall obtain and
maintain standard form directors' and officers' liability insurance with
responsible carriers and in reasonable amounts, and any other additional
insurance which may reasonably be obtained, covering to the extent available,
any liability of the kind described above and protecting Employee against the
costs and expenses described herein which are not for any reason satisfied by
the Company.
The obligations herein shall bind any successor corporation to the
Company (whether direct or indirect, by merger, consolidation or otherwise) so
that Employee shall stand in the same position under this Agreement with respect
to any successor corporation as he would have with respect to the Company if its
separate existence had continued. The Company's obligations under this Section
6 shall survive termination of this Agreement and shall survive indefinitely
with respect to any costs or liability incurred by Employee on
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account of any actual or alleged action or inaction by the Employee while
employed by the Company.
7. Termination. This Agreement may be terminated prior to the end of
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its Term as set forth below:
(a) Resignation. Employee may resign, including by reason of
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retirement, his position at any time. In the event of such resignation, except
in the case of resignation for Good Reason (as defined below) Employee shall
only be entitled to the benefits provided in Section 7(c)(i)(C) below; provided,
however, that for the purposes of this Section 7(a) the "Remaining Term" (as
used in Section 7(c)(i)(A)) shall not extend beyond the date that is one (1)
month after the Date of Termination.
(b) Death. If Employee's employment is terminated due to his death,
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this Agreement shall terminate and the Company shall have no obligations to
Employee's estate or his legal representatives with respect to this Agreement
other than the payment of any Base Compensation accrued, but unpaid, at the date
of Employee's death.
(c) Discharge.
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(i) The Company may terminate this Agreement and Employee's employment
for any reason deemed sufficient by the Company upon notice as provided in
Section 12. In the event that Employee's employment is terminated by the
Company during the Term for any reason other than Cause (as defined in
subsection 7(c)(iii) below), then, subject to Section 7(g):
(A) beginning with the first day of the month on or following the
Date of Termination and continuing until the earlier of Employee's death or the
date this Agreement would otherwise have terminated had Employee's employment
not
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terminated (the "Remaining Term"), but in no event less than three (3) years,
the Company shall pay Employee in cash an amount equal to 1/12th of the Base
Compensation, less the amount, if any, of (x) monthly base salary payable to
Employee by another employer for services rendered by Employee that month or
(y) monthly disability income paid to Employee pursuant to any Company-sponsored
long-term disability plan;
(B) if at the time of termination Employee has completed six (6) or
more months of the then current fiscal year, Employee shall be entitled to a pro
rata bonus, provided the criteria established by the Board for such bonus have
been fully satisfied as of the Date of Termination; such bonus shall be paid
within sixty (60) days following the date within which a bonus, if any, is
declared; no bonus shall be paid in the event of voluntary resignation or
termination for Cause and nothing contained in this subsection 7(c)(i)(B) shall
require the Board to declare a bonus;
(C) for the Remaining Term, the Company shall provide Employee (and
his eligible dependents, if any) with life, disability, accident and group
health insurance benefits substantially similar to those which Employee (and his
dependents) were receiving immediately prior to the Notice of Termination,
provided Employee pays the regular premium required of active employees for such
coverage, (following the expiration of the Remaining Term, Employee shall be
eligible to purchase health insurance benefits in accordance with applicable
Federal law); benefits otherwise receivable by Employee pursuant to this clause
(C) shall be reduced to the extent comparable benefits are actually received by
Employee (or his dependents) during the Remaining Term pursuant to a similar
plan or program of another employer, and any such other benefits actually
received by Employee must be reported to the Company; and
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(D) all stock options, warrants, rights and other Company stock-
related awards granted to Employee by the Company (collectively "Stock Awards")
that would otherwise have vested and become exercisable during the fiscal year
in which Employee has terminated, shall become upon the Date of Termination
fully vested (nonforfeitable), all restrictions (except for restrictions
required by law), if any, thereon shall lapse, all performance goals, if any,
associated therewith shall be deemed met in full, and Employee shall be entitled
to exercise any or all such Stock Awards in accordance with the other terms of
the stock option plan, stock incentive plan, stock issuance plan or similar plan
(any and all such plans being hereinafter referred to collectively as the
"Company Stock Option Plan") under which such Stock Awards were issued.
(ii) Notwithstanding the foregoing provisions of this Section 7, in
the event Employee is terminated because of Cause, the Company shall have no
obligations to Employee pursuant to this Agreement after the Date of
Termination. As used herein, the term "Cause" shall include termination by
action of the Board because of: (1) the Employee's indictment for, or plea of
nolo contendere to, a felony or a crime involving moral turpitude; (2) the
Employee's acts of dishonesty intended to result in personal enrichment to the
Employee at the Company's expense; or (3) the Employee's habitual failure to
perform his usual responsibilities, provided, however, that in the case of any
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termination pursuant to clause (3) above, the Company shall give the Employee
ten (10) business day's written notice thereof, and a reasonable opportunity to
be heard by the Board to show just cause for his actions, and to request the
Board, in its discretion, to reverse or rescind its prior action.
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(d) Resignation for Good Reason. Employee shall be entitled to
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terminate his employment for Good Reason as defined herein. If Employee
terminates his employment for Good Reason he shall be entitled to the
compensation and benefits provided in Section 7(c) above as if Employee had been
discharged by the Company other than for Cause. "Good Reason" shall mean
(1) the material breach of any of the Company's obligations under this Agreement
without Employee's express written consent or (2) the occurrence of any of the
following circumstances without Employee's express written consent unless such
breach of circumstances are fully corrected, if correctable, prior to the Date
of Termination specified in the Notice of Termination pursuant to Sections 7(e)
and 7(f), respectively, given in respect thereof:
(i) a substantially adverse alteration in the nature or status of
Employee's authority, responsibilities or position from those in effect as of
the date hereof;
(ii) on or after a Change in Control, reduction in Base Compensation
or annual target bonus opportunity (excluding annual reductions of up to 10%
that apply to all officers of the Company or its successor);
(iii) on or after a Change in Control, a change of more than fifty
(50) miles in the office or location where the Employee is based; or
(iv) any failure of the Company to obtain the assumption and
agreement to perform this Agreement by a successor as contemplated by Section
14(a).
Employee's right to terminate his employment pursuant to this subsection
shall not be affected by his incapacity due to physical or mental illness.
Further, Employee's continued employment for a period of up to twelve (12)
months, following any breach or circumstances described above, shall not
constitute Employee's consent to, or a
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waiver of Employee's rights hereunder with respect to, any such breach or
circumstance constituting Good Reason.
(e) Notice of Termination. Any purported termination of Employee's
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employment by the Company or by Employee shall be communicated by written notice
(the "Notice of Termination") to the other party hereto in accordance with
Section 12 hereof. In the case of resignation for Good Reason, said notice must
specify in reasonable detail the basis for such resignation.
(f) Date of Termination. "Date of Termination" shall mean the date
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specified in the Notice of Termination.
(g) Mitigation. Employee shall be required to mitigate the amount of
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continued Base Compensation payments provided for in Section 7(c)(i)(A) by
making reasonable efforts to seek other employment during the Remaining Term;
however, Employee shall not be required to accept any employment with respect to
which Employee's position, authority or duties shall be in any material respect,
in the good faith opinion of Employee, inconsistent with those contemplated in
Section 3 of this Agreement or which is based at any location outside the
metropolitan area in which Employee is based at the time of termination.
(h) Certain Further Payments by the Company.
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(i) In the event that any amount or benefit paid or distributed to
the Employee by the Company or any company controlling, controlled by or under
common control with the Company (an "Affiliated Company"), whether pursuant to
this Agreement or otherwise (collectively, the "Covered Payments"), is or
becomes subject to the tax (the "Excise Tax") imposed under Section 4999 of the
Internal Revenue Code (the
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"Code") or any similar tax that may hereafter be imposed, the Company shall
either pay to the Employee or contribute for the benefit of the Employee to a
"rabbi" trust established by the Company prior to the Change in Control Date, at
the time specified in Section 8(e) below, the Tax Reimbursement Payment (as
defined below). The Tax Reimbursement Payment is defined as an amount, which
when added to the Covered Payments and reduced by any Excise Tax on the Covered
Payments and any federal, state and local income tax and Excise Tax on the Tax
Reimbursement Payment provided for by this Agreement (but without reduction for
any federal, state or local income or employment tax on such Covered Payments),
shall be equal to the sum of (i) the amount of the Covered Payments, and (ii) an
amount equal to the product of any deductions disallowed for federal, state or
local income tax purposes because of the inclusion of the Tax Reimbursement
Payment in the Employee's adjusted gross income and the highest applicable
marginal rate of federal, state or local income taxation, respectively, for the
calendar year in which the Tax Reimbursement Payment is to be made.
(ii) For purposes of determining whether any of the Covered Payments
will be subject to the Excise Tax and the amount of such Excise Tax,
(A) such Covered Payments will be treated as "parachute payments"
within the meaning of Section 280G of the Code, and all "parachute payments" in
excess of the "base amount" (as defined under Section 280G(b)(3) of the Code)
shall be treated as subject to the Excise Tax, unless, and except to the extent
that, in the opinion of the Company's independent certified public accountants,
which, in the case of Covered Payments made after the Change in Control Date,
shall be the Company's independent certified public accountants appointed prior
to the Change in Control Date, or tax counsel
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selected by such accountants (the "Accountants"), such Covered Payments (in
whole or in part) either do not constitute "parachute payments" or represent
reasonable compensation for services actually rendered (within the meaning of
Section 280G(b)(4) of the Code) in excess of the "base amount", or such
"parachute payments" are otherwise not subject to such Excise Tax, and
(B) the value of any non-cash benefits or any deferred payment or
benefit shall be determined by the Accountants in accordance with the principles
of Section 280G of the Code.
(iii) For purposes of determining the amount of the Tax Reimbursement
Payment, the Employee shall be deemed:
(A) to pay federal income taxes at the highest applicable
marginal rate of federal income taxation for the calendar year in which the Tax
Reimbursement Payment is to be made,
(B) to pay any applicable state and local income taxes at the
highest applicable marginal rate of taxation for the calendar year in which the
Tax Reimbursement Payment is to be made, net of the maximum reduction in federal
income taxes which could be obtained from the deduction of such state or local
taxes if paid in such year (determined without regard to limitations on
deductions based upon the amount of the Employee's adjusted gross income), and
(C) to have otherwise allowable deductions for federal, state and
local income tax purposes at least equal to those disallowed because of the
inclusion of the Tax Reimbursement Payment in the Employee's adjusted gross
income.
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(iv) In the event that the Excise Tax is subsequently determined by
the Accountants to be less than the amount taken into account hereunder in
calculating the Tax Reimbursement Payment made, the Employee shall repay to the
Company, at the time that the amount of such reduction in the Excise Tax is
finally determined, the portion of such prior Tax Reimbursement Payment that has
been paid to the Employee or to federal, state or local tax authorities on the
Employee's behalf and that would not have been paid if such Excise Tax had been
applied in initially calculating such Tax Reimbursement Payment, plus interest
on the amount of such repayment at the rate provided in Section 1274(b)(2)(B) of
the Code. Notwithstanding the foregoing, in the event any portion of the Tax
Reimbursement Payment to be refunded to the Company has been paid to any
federal, state or local tax authority, repayment thereof shall not be required
until actual refund or credit of such portion has been made to the Employee, and
interest payable to the Company shall not exceed interest received or credited
to the Employee by such tax authority for the period it held such portion. The
Employee and the Company shall mutually agree upon the course of action to be
pursued (and the method of allocating the expenses thereof) if the Employee's
good faith claim for refund or credit is denied.
In the event that the Excise Tax is later determined by the
Accountants to exceed the amount taken into account hereunder at the time the
Tax Reimbursement Payment is made (including, but not limited to, by reason of
any payment the existence or amount of which cannot be determined at the time of
the Tax Reimbursement Payment), the Company shall make an additional Tax
Reimbursement Payment in respect of such excess
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(which Tax Reimbursement Payment shall include any interest or penalty payable
with respect to such excess) at the time that the amount of such excess is
finally determined.
(v) The portion of the Tax Reimbursement Payment attributable to a
Covered Payment shall be paid to the Employee or to a "rabbi" trust established
by the Company prior to the Change in Control Date within ten (10) business days
following the payment of the Covered Payment. If the amount of such Tax
Reimbursement Payment (or portion thereof) cannot be finally determined on or
before the date on which payment is due, the Company shall either pay to the
Employee or contribute for the benefit of the Employee to a "rabbi" trust
established by the Company prior to the Change in Control Date, an amount
estimated in good faith by the Accountants to be the minimum amount of such Tax
Reimbursement Payment and shall pay the remainder of such Tax Reimbursement
Payment (which Tax Reimbursement Payment shall include interest at the rate
provided in Section 1274(b)(2)(B) of the Code) as soon as the amount thereof can
be determined, but in no event later than forty-five (45) calendar days after
payment of the related Covered Payment. In the event that the amount of the
estimated Tax Reimbursement Payment exceeds the amount subsequently determined
to have been due, such excess shall be repaid or refunded pursuant to the
provisions of Section 8(d) above.
8. Change In Control.
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(a) For purposes of this Agreement, a "Change in Control" means the
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first to occur of the following events:
(i) any person (as defined in Section 3(a)(9) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and as used in Sections
13(d) and 14(d) thereof), excluding the Company, any direct or indirect
subsidiary of the Company in
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which the Company has direct or indirect majority ownership (a "Subsidiary") and
any employee benefit plan sponsored or maintained by the Company or any
Subsidiary (including any trustee of such plan acting as trustee) (the Company,
all Subsidiaries, and such employee benefit plans and trustees acting as
trustees being hereafter referred to as the "Company Group"), but including a
`group' as defined in Section 13(d)(3) of the Exchange Act (a "Person"), becomes
the beneficial owner of shares of the Company having at least thirty percent
(30%) of the total number of votes that may be cast for the election of
directors of the Company (the "Voting Shares"); provided that no Change in
Control will occur as a result of an acquisition of stock by the Company Group
which increases, proportionately, the stock representing the voting power of the
Company beneficially owned by such Person above thirty percent (30%) of the
voting power of the Company, and provided further that if such Person acquires
beneficial ownership of stock representing more than thirty percent (30%) of the
voting power of the Company by reason of share purchases by the Company Group,
and after such share purchases by the Company Group acquires any additional
shares representing voting power of the Company, then a Change in Control shall
occur;
(ii) the shareholders of the Company shall approve any merger or
other business combination of the Company, sale of the Company's assets or
combination of the foregoing transactions (a "Transaction") other than a
Transaction involving only the Company and one or more of its Subsidiaries, or a
Transaction immediately following which the shareholders of the Company
immediately prior to the Transaction continue to have a majority of the voting
power in the resulting entity
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excluding for this purpose any shareholder owning directly or indirectly more
than ten percent (10%) of the shares of the other company involved in the
merger; or
(iii) within any 24-month period, the persons who were directors of
the Company immediately before the beginning of such period (the "Incumbent
Directors") shall cease (for any reason other than death) to constitute at least
a majority of the Board or the board of directors of any successor to the
Company, provided that any director who was not a director as of the date of
this Agreement shall be deemed to be an Incumbent Director if such director was
elected to the Board of Directors by, or on the recommendation of or with the
approval of, at least two-thirds of the directors who then qualified as
Incumbent Directors either actually or by prior operation of this clause (iii);
and provided further that any director elected to the Board of Directors to
avoid or settle a threatened or actual proxy contest shall in no event be deemed
to be an Incumbent Director.
(b) In the event of a Change in Control, Employee's options granted
under any Company Stock Option Plan shall become immediately exercisable to the
extent provided by the terms of any such plan in effect as of the effective date
of this Agreement, all such plans being incorporated herein by reference.
(c) GranCare shall be obligated after a Change in Control to continue
to provide to Employee the same aggregate level of fringe benefits described in
Section 5 which were provided prior to the Change in Control.
9. Confidentiality. Employee hereby acknowledges that the Company
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may, from time to time during the Term, disclose to Employee confidential
information pertaining to the Company's business and affairs and patient base,
including, without limitation, patient lists and accounts, other similar items
indicating the source of the
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Company's income, and information pertaining to the salaries, duties and
performance levels of the Company's employees. Employee shall not, at any time
during or after such Term, disclose to any third party or directly or indirectly
make use of any such confidential information, including, without limitation,
the names, addresses and telephone numbers of the Company's patients, other than
in connection with the Company's business and affairs. All documents and data
(whether written, printed or otherwise reproduced or recorded) containing any
such proprietary information of the Company which may come into Employee's
possession during the Term shall be returned by Employee to the Company
immediately upon the termination of the Term, and Employee shall not retain any
copies, notes or excerpts thereof without the Company's consent. Employee's
obligations under this Section 9 shall continue in effect after the termination
of the Term, whatever the reason or reasons for such termination.
10. Ownership Rights. All materials, ideas, discoveries and
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inventions pertaining to the Company's business, including (without limitation)
all patents and copyrights, patent applications, patent renewals and extensions,
and the names, addresses and telephone numbers of patients, shall belong solely
to the Company. All materials, ideas, discoveries and inventions which Employee
may devise, conceive, develop or reduce to practice (whether individually or
jointly with others) during the Employment Period shall be the sole property of
the Company and are hereby assigned by Employee to the Company, except for any
idea, discovery or invention (i) for which no Company equipment, supplies,
facility or trade secret information is used, (ii) which is developed entirely
on Employee's own time and (iii) which neither (a) relates, at the time of
conception or reduction to practice, to the Company's business or any actual or
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demonstrably-anticipated research or development program of the Company nor (b)
results from any work performed by Employee for the Company.
11. Assignability. The obligations of Employee hereunder are
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personal and may not be assigned or delegated by him or transferred in any
manner whatsoever, nor are such obligations subject to involuntary alienation,
assignment or transfer. The Company may not assign this Agreement or delegate
any of its rights, duties or obligations hereunder, either in whole or in part,
to any person or entity, without the express written consent of Employee, except
as provided in Section 14.
12. Notice. For the purpose of this Agreement, notices and all other
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communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the
Company at its principal office address, directed to the attention of the Board
with a copy to the Secretary of the Company, and to Employee at Employee's
residence address on the records of the Company or to such other address as
either party may have furnished to the other in writing in accordance herewith
except that notice of change of address shall be effective only upon receipt.
13. Validity. The invalidity or unenforceability of any provision of
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this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
14. Successors; Binding Agreement.
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(a) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in
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the same manner and to the same extent that the Company would be required to
perform it if no such succession had taken place. Failure of the Company to
obtain such agreement prior to the effectiveness of any such succession shall be
a breach of this Agreement and shall entitle Employee to compensation from the
Company in the same amount and on the same terms as he would be entitled to
hereunder if he terminated his employment for Good Reason, except that for
purposes of implementing the foregoing, the date on which any such succession
becomes effective shall be deemed the Date of Termination. As used herein, the
term "Company" shall include any successor to its business and/or assets as
aforesaid which executes and delivers the Agreement provided for in this Section
14 or which otherwise becomes bound by all terms and provisions of this
Agreement by operation of law.
(b) This Agreement and all rights of Employee hereunder shall inure to
the benefit of and be enforceable by Employee's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If Employee should die while any amounts would be
payable to him hereunder if he had continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to Employee's devisee, legatee, or other designee or, if there be no
such designee, to Employee's estate.
15. Miscellaneous. No provision of this Agreement may be modified,
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waived or discharges unless such waiver, modification or discharge is agreed to
in writing and signed by Employee and such officer as may be specifically
authorized by the Board. No waiver by either party hereto at any time of any
breach by the other party hereto of, or in compliance with, any condition or
provision of this Agreement to be performed by such
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party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. This Agreement is an integration
of the parties' agreement; no agreement or representation, oral or otherwise,
express or implied, with respect to the subject matter hereof have been made by
either party which are not set forth expressly in the Agreement. The validity,
interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of Georgia.
16. Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
17. Arbitration. Employee shall be permitted (but not required) to
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elect that any dispute or controversy arising under or in connection with this
Agreement be settled by arbitration in Atlanta, Georgia, in accordance with the
rules of the American Arbitration Association then in effect. Judgment may be
entered on the arbitrator's award in any court having jurisdiction.
18. Release of Prior Employment Agreement. Employee hereby releases
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Old GranCare from all obligations owing to Employee under the Prior Employment
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Agreement, including any obligation to pay severance or other post-termination
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benefits; provided, however, that in no event shall this release affect
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Employee's rights under any grant or award under any stock option or stock award
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plans of Old GranCare.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date provided above.
GRANCARE, INC.
By:
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Title:
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EMPLOYEE:
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