EXHIBIT 10.8
EMPLOYMENT AGREEMENT
This Agreement ("Agreement") dated this 31st day of December, 1998
between In Home Health, Inc. ("Employer" or "In Home"), a Minnesota
corporation, with principal offices at 000 Xxxxxxx Xxxxxxx, Xxxxxxxxxx,
Xxxxxxxxx 00000, and Xxxxxx X. Xxxxxxx, Xx. ("Employee"), sets forth the
terms and conditions governing the employment relationship between Employee
and In Home.
1. EMPLOYMENT. During the term of this Agreement, as hereinafter
defined, Employer hereby employs Employee as Chief Financial Officer.
Employee hereby accepts such employment upon the terms and conditions
hereinafter set forth and agrees to faithfully and to the best of his ability
perform such duties as may be from time to time assigned by Employer, its
Board of Directors or its designees, such duties to be rendered at the
principal office of Employer or at such other place or places as Employer
shall require. Employee also agrees to perform his duties in accordance with
policies established by Employer's Board of Directors, which may be changed
from time to time.
2. TERM. Subject to the provisions for termination hereinafter
provided, the term of this Agreement shall begin on January 1, 1999 and shall
terminate December 31, 2001.
3. COMPENSATION. For all services rendered by Employee under this
Agreement during the term thereof, Employer shall pay Employee the following
compensation:
(a) SALARY. A base salary of $118,000 per annum payable in
accordance with Employer's standard payroll practices from time to time
in effect. Such salary shall be reviewed after one year and may be
increased at the discretion of Employer.
44
(b) INCENTIVE BONUS. Employee shall have the opportunity to
earn up to a maximum of 35% of the base salary set forth in
subparagraph 3(a) above in Employer's bonus plans as adopted from time
to time by Employer's Board of Directors.
(c) STOCK OPTIONS. Employee shall be entitled to participate
in the In Home Health, Inc. Stock Option Plan, or similar plan, in
accordance with the policy of the In Home Home Health, Inc. Board of
Directors as in effect from time to time. Employee shall be granted a
minimum of 5,000 stock options between January 1, 1999 and March 31,
1999.
(d) OTHER BENEFITS. Employee shall, when eligible, be entitled
to participate in all other fringe benefits accorded headquarters
employees by Employer as are in effect from time to time.
Effective as of January 1, 1999, the Employee shall be
eligible for medical coverage or reimbursed for the cost of medical
coverage under COBRA with Employee's previous employer. Effective
January 1, 1999, the Employee would be eligible to participate in the
Company's 401K and stock purchase plan unless prohibited by law or
regulation.
45
4. EXTENT OF SERVICES. Employee shall devote his full time, attention,
and energies to the business of Employer, and shall not during the term of this
Agreement be engaged in any other significant business activity pursued for
gain, profit, or other pecuniary advantage; but this shall not be construed as
preventing Employee from investing his assets in the securities of public
companies if such holdings do not exceed one percent (1%) of the outstanding
shares of any such company. Employee warrants and represents that he has no
contracts or obligations to others which would materially inhibit the
performance of his services under this Agreement.
5. DISCLOSURE AND USE OF INFORMATION. Employee recognizes and
acknowledges that Employer's and affiliates' present and prospective clients,
franchises, contracts, development and marketing plans, acquisitions, operating
data, policies, and personnel, as they may exist from time to time, are
valuable, special and unique assets of Employer's business. Throughout the term
of this Agreement and for a period of six (6) months after its scheduled
termination or expiration as set forth in paragraph 2 above, Employee shall not
directly or indirectly, or cause others to: (1) make use of or disclose to
others any information relating to the business of Employer that has not
otherwise been made public, including but not limited to Employer's and
affiliates' present or prospective clients, franchises, contracts, development
and marketing plans, acquisitions, operating data, and policies; or (2) without
Employer's prior written consent, offer employment to or employ on behalf of
Employee or any other person, any person who at any time is or has been within
the preceding one (1) year an employee of Employer or any parent, subsidiary or
affiliate
46
of Employer, or induce such person, directly or indirectly, to leave his or
her employment. In the event of an actual or threatened breach by Employee of
the provisions of this paragraph, Employer shall be entitled to injunctive
relief restraining Employee from committing such breach or threatened breach.
Nothing herein stated shall be construed as preventing Employer from pursuing
any other remedies available to the company for such breach or threatened
breach, including the recovery of damages from Employee.
6. NOTICES. Any notice, request or demand required or permitted to be
given under this Agreement shall be in writing, and shall be delivered
personally to the recipient or sent by certified or registered mail to his
residence in the case of Employee, or to its principal office in the case of the
Employer.
7. ELECTIVE POSITIONS. Nothing contained in this Agreement is
intended to nor shall be construed to abrogate, limit or affect the powers,
rights and privileges of the Board of Directors or stockholders to remove
Employee as Chief Financial Officer, with or without just cause, during the
term of this Agreement or to elect someone other than Employee to that
position, as provided by law and the By-Laws of Employer; provided, however,
that if Employee is so removed without cause, it is expressly understood and
agreed, in the event any one or combination of the foregoing occurs,
Employee's rights under this Agreement shall in no way be prejudiced and
Employee shall, nevertheless, be entitled to receive compensation referred to
in paragraph 3 above, except any right to receive new stock option grants, so
long as he is ready, willing and able to perform the duties and
responsibilities set forth above. Notwithstanding the foregoing, the election
or appointment of Employee to a different executive position shall not be
considered removal hereunder.
47
Employee upon removal shall be entitled to pursue other employment. As a
condition to Employee receiving his compensation from Employer, Employee
agrees to furnish Employer annually with full information regarding such
other employment and to permit inspection of his records at any such
employment and copies of his Federal income tax returns. Employer shall
receive credit for unemployment insurance benefits, social security insurance
or like amounts actually received by Employee.
8. WAIVER OF BREACH. The waiver of either party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of
any subsequent breach.
9. ASSIGNMENT. The rights and obligations of Employer under this
Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of Employer. The obligations of Employee hereunder may
not be assigned or delegated.
10. TERMINATION OF AGREEMENT. This Agreement shall terminate upon the
following events and conditions.
(a) For just cause, including but not limited to, refusal to
carry out duties and instructions relative to the position, dishonesty,
violation of this Agreement, and any willful acts or omissions
inimical to or contrary to policies of Employer not arbitrarily
applied in the case of Employee. In the event of termination by
Employer for just cause, vested but unexercised options granted during
the term of this Agreement shall be forfeited as a result thereof, as
of the date of notice. Employee shall be entitled to fourteen (14)
days advance written notice of any such termination, except where the
basis for the termination constitutes conduct on the part of Employee
involving dishonesty or bad faith, and in such latter cases, the
termination shall be effective upon the sending of notice.
48
(b) In the event that Employee is unable to perform the
services called for hereunder by reason of incapacity or disablement
for more than six (6) months (whether or not consecutive) in any period
of twenty-four (24) consecutive months, Employer shall have the right
to terminate this Agreement by written notice to Employee. In the event
of such termination, all non-vested obligations of Employer to Employee
pursuant to this Agreement shall terminate.
(c) In the event of Employee's death during the term of this
Agreement, the Agreement shall terminate as of the date thereof.
(d) Without cause. The Company may terminate the employee for
any reason, at any time, upon written notice of such intention to
terminate. In the event of termination without cause, the Employee
shall be entitled to the payments described in subparagraph 10(a). In
addition, the Employee will be entitled to severance of twelve months
base salary and the ratable portion of bonus computed on the Employee's
maximum annual bonus potential and reasonable moving expenses to
transport Employee's personal effects from Minnesota to Maryland. The
cost of such moving expenses shall be limited to $8,000. Also, in the
event the Employee entered into a binding purchase contract or
purchased a residence in Minnesota prior to written notification of
termination or the expiration of this agreement, the Company will
reimburse the Employee an amount equal to 7% of the appraised value of
such residence.
49
(e) Corporate relocation. In the event the Employee is
offered the option to continue employment with In Home contingent
upon relocation from Minnesota, the Employee may opt to terminate
employment and receive severance of six months base salary plus the
ratable portion of bonus computed on the Employee's maximum bonus
potential and reasonable moving expenses to transport Employee's
personal effects from Minnesota to Maryland not to exceed $8,000.
11. CHANGE OF CONTROL. In the event of a change of control of In
Home, all options granted to the Employee would vest immediately and be
payable in cash at the time of any change of control of In Home. Should the
change of control result in termination of the Employee, all other provisions
of subparagraph 10(d) would be applicable.
12. RELOCATION EXPENSES. Employee shall be reimbursed for relocation
expenses including moving expenses from Maryland to Minnesota, seller's
closing costs on existing residence located in Maryland, and buyer's closing
costs on new residence in Minnesota. Such costs will be limited to $17,700
(15% of Employee's base salary).
13. SEVERABILITY. If for any reason, any provision of this Agreement
is held invalid, such invalidity shall not effect any other provision of this
Agreement not held so invalid, and each such other provision shall to the
full extent consistent with law continue in full force and effect.
14. HEADINGS. The headings of paragraphs herein are included solely
for convenience of reference and shall not control the meaning or
interpretation of any of the provisions of this Agreement.
50
15. ENTIRE AGREEMENT. This instrument contains the entire agreement of
the parties. It may be changed only by an agreement in writing signed by the
party against whom enforcement of any waiver, change, modification, extension,
or discharge is sought. This Agreement shall be governed by the laws of the
State of Minnesota and any litigation shall be conducted in the State of
Minnesota.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date first set forth above.
Employer:
IN HOME HEALTH, INC.
By:______________________________
Xxxxxxxx xxx Xxxxx
Chairman of the Board
Witness: Employee:
--------------------------- --------------------------------
Xxxxxx X. Xxxxxxx Xx.
51
