Exhibit 10.3
AMENDMENT TO & ASSIGNMENT OF EMPLOYMENT AGREEMENT
-------------------------------------------------
THIS AMENDMENT TO & ASSIGNMENT OF EMPLOYMENT AGREEMENT ("Amendment and
Assignment") is made this 11th day of June, 2001, by and between AMERIPATH
FLORIDA, INC. (the "Company"), AMERIPATH, INC. ("AmeriPath, Inc.") and XXXXXX X.
---------
XXXXX, XX., M.D. (the "Executive").
---------------
W I T N E S S E T H
WHEREAS, the Executive and the Company entered into an Employment
Agreement dated December 1, 1997 (the "Employment Agreement"), pursuant to which
the Executive has been providing services; and
WHEREAS, the Executive and the Company wish to amend the Employment
Agreement to reflect changes in the Executive's duties, level of responsibility
and compensation; and
WHEREAS, the Company wishes to assign the Employment Agreement to
AmeriPath, Inc.
NOW, THEREFORE, in consideration of the mutual promises contained
herein, the Executive's continued employment and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Executive and the Company agree as follows:
1. Recitals. The above recitals are true and correct and are
--------
incorporated herein by this reference.
2. Assignment. Pursuant to Section 24 of the Employment Agreement,
----------
the Company hereby assigns the Employment Agreement to its parent, AmeriPath,
Inc. The Executive consents to and accepts such assignment. AmeriPath, Inc.
accepts such assignment and assumes and guarantees the obligations of the
Company under the Employment Agreement. In accordance with this assignment, the
term "Company", in the Employment Agreement, shall, hereafter, refer to
AmeriPath, Inc.
3. Position. The first sentence in Section 1 of the Employment
--------
Agreement is amended to read: "Subject to the terms and conditions of this
Agreement, the Company shall employ the Executive to render professional
services to the Company as its Executive Vice President of Genomic Strategies
and Chief Medical Officer, and the Executive accepts such employment and such
position." The Executive's title, in the second sentence of Section 3 of the
Employment Agreement is changed from "Medical Director of the Jacksonville
Division" to "Executive Vice President of Genomic Strategies and Chief Medical
Officer".
4. Salary. The Executive's salary, as set forth in Section 7 of the
------
Employment Agreement, is changed from "$250,000" to "$350,000" effective January
1, 2001.
5. Stock Options. The last two sentences in Section 7 of the
-------------
Employment Agreement are deleted and the following language is substituted
therefore:
"During the Term hereunder, and subject to the execution of any other
applicable agreements, the Executive shall be eligible on an annual basis to
receive options (the "Stock Options") to purchase common stock (the "Common
------------- ------
Stock") of the Company, the amount to be determined by the Chairman of the Board
------
and CEO (the "Chairman") of the Company based upon the Executive's performance
--------
and services rendered to the Company, and subject to the approval by both the
Compensation Committee and the Board at their regular annual review of executive
performance. If and to the extent awarded, the Stock Options shall be granted
under (and therefore subject to all terms of) the Company's stock option plan
(the "Stock Option Plan") and pursuant to the terms of a certain stock option
-----------------
agreement (the "Option Agreement") to be entered into by and between the
----------------
Executive and the Company. In addition, during the Term, the Executive shall be
eligible to be granted additional options under the Company's Stock Option Plan.
The number, if any, of additional options and terms and conditions thereof shall
be determined by the Committee appointed pursuant to the Stock Option Plan, or
by the Board of Directors of the Company, in its discretion and pursuant to the
Stock Option Plan. Notwithstanding any other provision of this Agreement,
Option Agreements entered into by the Executive and the Company prior to the
date of this Agreement shall remain in full force and effect."
6. Termination. The following subsection (d) is added to Section 15
-----------
of the Employment Agreement:
(d) Change in Control of the Company.
--------------------------------
(1) In the event that a Change in Control [as defined in
subsection (2) of this Section 6 (d)] in the Company shall occur during the Term
of Employment, the Company shall accelerate the vesting of all AmeriPath Stock
Options which have been granted to the Executive but are unvested, so that the
unvested shares are one hundred (100) percent vested on the date of the Change
in Control. In addition, if a Change in Control of the Company occurs during the
Term of Employment, and prior to one year after the date of the Change in
Control the Term is terminated by the Company without Cause pursuant to Section
15 (c) hereof, or the Company requires the Executive to be based at any office
or location more than twenty-five (25) miles from that in which the Executive
was working on the date of the Change in Control and the Executive thereby
elects to terminate this Agreement, the Company shall (i) pay to the Executive
any accrued and unpaid Base Salary through the effective date of the
termination, (ii) pay to the Executive, within 30 days of the termination of his
employment hereunder, a lump sum payment equal to one times the Executive's
annual Base Salary, and (iii) accelerate the vesting of all AmeriPath Stock
Options which have been granted to the Executive but are unvested, so that the
unvested shares are one hundred (100) percent vested as of the Executive's
Termination Date. The Company shall have no further liability hereunder (other
than for reimbursement for reasonable business expenses incurred prior to the
date of termination and payment of compensation for accrued and unused vacation
days).
(2) For purposes of this Agreement, the term "Change in Control"
-----------------
shall mean:
(A) Approval by the shareholders of the Company of (x) a
reorganization, merger, consolidation or other form of corporate transaction or
series of
2
transactions, in each case, with respect to which persons who were the
shareholders of the Company immediately prior to such reorganization, merger or
consolidation or other transaction do not, immediately thereafter, own more than
50% of the combined voting power entitled to vote generally in the election of
directors of the reorganized, merged or consolidated company's then outstanding
voting securities, in substantially the same proportions as their ownership
immediately prior to such reorganization, merger, consolidation or other
transaction, or (y) a liquidation or dissolution of the Company or (z) the sale
of all or substantially all of the assets of the Company (unless such
reorganization, merger, consolidation or other corporate transaction,
liquidation, dissolution or sale is subsequently abandoned);
(B) Individuals who, as of the Commencement Date of this
Agreement, constitute the Board (the "Incumbent Board") cease for any reason to
---------------
constitute at least a majority of the Board, provided that any person becoming a
director subsequent to the Commencement Date of this Agreement whose election,
or nomination for election by the Company's shareholders, was approved by a vote
of at least a majority of the directors then comprising the Incumbent Board
(other than an election or nomination of an individual whose initial assumption
of office is in connection with an actual or threatened election contest
relating to the election of the Directors of the Company) shall be, for purposes
of this Agreement, considered as though such person were a member of the
Incumbent Board; or
(C) the acquisition (other than by or from the Company) by
any person, entity or "group", within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act, of beneficial ownership within the
meaning of Rule 13-d promulgated under the Securities Exchange Act of 50% or
more of either the then outstanding shares of the Company's Common Stock or the
combined voting power of the Company's then outstanding voting securities
entitled to vote generally in the election of directors [(hereinafter referred
to as the ownership of a "Controlling Interest") excluding, for this purpose,
--------------------
any acquisitions by (i) the Company or its Subsidiaries, (ii) any person, entity
or "group" that as of the Commencement Date of this Agreement owns beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Securities
Exchange Act) of a Controlling Interest or (iii) any Executive benefit plan of
the Company or its Subsidiaries].
7. Noncompetition and Non-Solicitation Agreement. The word "or," is
---------------------------------------------
added to the end of Section 20.(b)(2) and the following Section 20.(b)(3) is
added to the Employment Agreement:
(3) directly or indirectly, engage in or have any interest in
any sole proprietorship, corporation, company, partnership, association, venture
or business or any other person or entity that directly or indirectly (or
through any affiliated entity) competes with the Company's business (for
purposes of this Agreement, any business that engages in the management or
provision of anatomic pathology diagnostic services (whether through physician
practices, laboratories, hospitals, medical or surgery centers or otherwise)
shall be deemed to compete with the Company's business); provided that such
provision shall not apply to the Executive's ownership of common stock of the
Company or the acquisition by the Executive, solely as an investment, of
securities of any issuer that are registered under Section 12(b) or 12(g) of the
Securities Exchange Act of 1934, as amended, and that are listed or admitted for
trading on any United States national securities exchange or that are quoted on
the National
3
Association of Securities Dealers Automated Quotations System, or any similar
system or automated dissemination of quotations of securities prices in common
use, so long as the Executive does not control, acquire a controlling interest
in or become a member of a group which exercises direct or indirect control of,
more than five percent (5.0%) of any class of capital stock of such corporation.
8. Conflicting Terms & Survival of Agreement. Except as specifically
-----------------------------------------
set forth herein, the Employment Agreement shall remain in full force and
effect. In the event the terms of this Amendment and Assignment shall conflict
with the terms of the Employment Agreement, the terms of this Amendment and
Assignment shall control.
9. Counterparts. This Amendment and Assignment may be executed in
------------
any number of counterparts, each of which shall be deemed to be an original, and
all of which together constitute one documents.
10. Final Agreement. The Employment Agreement, as amended by this
---------------
Amendment and Assignment, shall constitute the final agreement between the
parties hereto and supercedes any prior or contemporaneous agreement or
representation, oral or written, among them with respect to the matters set
forth in the Employment Agreement and this Amendment and Assignment.
11. Confidentiality. The Executive shall not disclose to any person
---------------
or entity any information whatsoever regarding the terms of this Amendment and
Assignment or the Agreement. Such limitation does not include Executive's
disclosure to any attorneys, accountants and professional tax advisers with whom
Executive chooses to consult or seek advice regarding Executive's consideration
of and decision to execute this Amendment and Assignment.
IN WITNESS WHEREOF, the parties have executed this Amendment and Assignment on
the date set forth above.
AMERIPATH FLORIDA, INC.
AMERIPATH, INC.
By: __________________________________________
Xxxxx X. New
Chairman and Chief Executive Officer
EXECUTIVE
_____________________________________________
Xxxxxx X. Xxxxx, Xx., M.D.
4
