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EXHIBIT 10.73
AMENDMENT NO. 1 TO CONFIDENTIALITY, NON-COMPETITION AND
SEVERANCE PAY AGREEMENT
THIS AMENDMENT NO. 1 TO CONFIDENTIALITY, NON-COMPETITION AND SEVERANCE
PAYMENT AGREEMENT is entered into on February __, 1999 by and between AMERICAN
HOMEPATIENT, INC., a Delaware corporation (the "Company"), and XXXXXX XXXXXX, a
resident of the State of Tennessee (the "Employee").
WHEREAS, the parties have entered into that certain Confidentiality,
Non-Competition and Severance Pay Agreement dated as of December 23, 1997 (the
"1997 Contract"); and
WHEREAS, the parties have entered into that certain Amendment No. 1 to
the 1997 Contract, which Amendment is to be nullified hereby; and
WHEREAS, the Company is currently involved in certain restructuring
activities, but has agreed to continue the employ of the Employee, either
directly or through a wholly-owned subsidiary; and
WHEREAS, in connection with the Employee's continuing employment with
the Company, the parties mutually desire to amend the 1997 Contract as
stipulated herein.
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements contained in the 1997 Contract and made herein, the parties,
intending to be legally bound hereby, agree as follows:
1. That certain Amendment No. 1 to Confidentiality, Non-Competition and
Severance Pay Agreement dated October 16, 1998 is hereby rendered null and void
by mutual agreement of the parties.
2. Clause B of Section 1 of the 1997 Contract is hereby modified by
adding the following at the end of the clause:
"Upon termination of employment, Employee will immediately deliver
to Company all materials, including but not limited to documents,
discs, computer software and copies thereof, containing confidential
and/or proprietary information of Company, whether compiled or
created by Employee or furnished to her."
3. Clause F of Section 1 of the 1997 Contract is hereby modified by
deleting the phrase "Section 1" and inserting in its stead "Sections 1 and 4."
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4. Section 2.1 of the 1997 Contract is hereby deleted in its entirety
and the following substituting in its stead:
2.1 Termination by Company Following a Change in Control. In the
event there is a "Change in Control" of the ownership of the
Company, and the Company terminates Employee's employment within
twelve (12) months following such Change in Control, the Employee
shall be entitled to receive as a severance payment in a lump sum
upon such termination an amount equal to the sum of (i) her monthly
base salary (not including incentive compensation or benefits) as
in effect at the time of such termination multiplied by twelve (12),
plus (ii) her monthly vehicle allowance (exclusive of gasoline
and oil expense reimbursement) multiplied by twelve (12), plus (iii)
the annual incentive compensation Employee received for performance
during the Company's immediately preceding fiscal year, multiplied
by a fraction, the numerator of which is the total number of full
calendar months during which the Employee was employed by the
Company during the Company's then current fiscal year prior to
termination and the denominator of which is twelve (12). In
addition, any earned but unpaid base salary and accrued vacation
will be paid. The Company will also pay the COBRA administrative
services company the COBRA premium attributable to Employee's
medical and dental insurance benefits as such benefits were in
effect immediately prior to termination, with payments beginning
on the first day of the calendar month immediately following the
date of termination and continuing until the earlier of (i) twelve
(12) months after the date of termination, or (ii) the date on
which Employee is eligible to receive, as an employee, independent
contractor or agent, medical and/or dental insurance benefits
from a third party. The Company will deduct from the lump sum
severance payment to the Employee the standard employee portion of
such COBRA premium as in effect on the date of termination for up
to a twelve (12) month period. If Employee elects to discontinue
COBRA for any reason before expiration of the twelve (12) month
period and notifies the Company of the same in writing, the Company
will thereafter refund to the Employee that portion of the
deduction not attributable to the COBRA premium actually paid. The
Company acknowledges that the Employee is entitled to her
individual, vested account balance with respect to the Company's
Stock Purchase Plan as the balance exists as of the date of
termination of employment. Further, any stock options granted to
the Employee will be fully vested upon a Change in Control, whether
or not the Employee is terminated, notwithstanding any previously
stated vesting restrictions, but subject to expiration or
termination pursuant to the governing stock option plan.
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5. The following is hereby inserted as new Section 2.3 of the 1997
Contract:
2.4 Termination Without Cause Not Accompanied by a Change in
Control. Although Employee has never raised an age discrimination
issue, in order for this Agreement to embody a release of all
claims as contemplated by both parties, federal law stipulates
that the Employee specifically release any potential claims on
the basis of age discrimination. Therefore, in consideration for
such release and in addition to other considerations stipulated
in this Agreement, the Company has agreed that in the event that
Company terminates Employee's employment without cause, and there
has been no Change in Control, Employee shall be entitled to
receive a severance payment, earned but unpaid base salary, COBRA
payments and vesting of stock options, all as and to the extent
stipulated in Section 2.1. Termination without cause shall not
include termination as a result of the following: termination for
cause, resignation by Employee, or Employee's death or
disability. "Cause" shall mean (i) if Employee engages in
insubordination, malfeasance or misconduct, (ii) Employee being
charged with or conviction of a felony offense or conviction of a
misdemeanor involving moral turpitude, and (iii) material breach
by Employee of her obligations under this Agreement.
Notwithstanding the above, it is the intent of the Company at all
times to comply with the Americans With Disabilities Act, the
Family and Medical Leave Act and any other applicable federal and
state employment laws.
6. The following is hereby inserted as new Section 3 of the 1997
Contract:
3. Compliance Programs. The Employee will at all times while
employed with the Company comply fully with the Company's
"Guidelines of Company Policies and Conduct" and any other
compliance program, as such programs may be amended from time to
time, and acknowledges that her obligations under such programs
as an employee are contractual in nature.
7. The following is hereby inserted as new Section 4 of the 1997
Contract:
4. Releases; Covenant Not to Xxx.
4.1 General Release. Employee hereby fully and forever
releases the Company, its successors and assigns, affiliates,
insurers, officers, directors, employees and agents, from any and
all liability, causes of action, suits, damages, claims and
demands whatsoever that
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Employee may have and that arise from or relate in any way to her
employment with the Company or the conduct of the Company's
business through February 15, 1999.
4.2 ADEA Release. Employee specifically releases Company and
the other related parties included in Section 4.1, from any
claims based upon any law prohibiting discrimination on the basis
of Employee's age including but not limited to the Age
Discrimination in Employment Act ("ADEA"). Employee does not
waive rights or claims under the ADEA that may arise after
February 15, 1999.
4.3 Covenant Not to Xxx. Employee covenants that she will not
initiate or bring any proceeding, suit, claim, or administrative
proceeding against the Company, its affiliates, agents,
employees, officers, directors, successors and assigns arising
out of or in any way related to her employment by the Company or
the conduct of the Company's business prior to February __, 1999.
Employee further covenants that she will not, without the
Company's prior written consent unless required to do so by means
of a valid court order or subpoena, cooperate with any person in
the institution or prosecution of any such proceeding, suit,
claim or investigation brought, initiated or conducted by any
person against the Company, its affiliates, agents, employees,
officers, directors, successors and assigns. Employee further
covenants that she will notify the Company immediately in the
event she is contacted by any person regarding any pending or
contemplated proceeding, suit, claim or investigation involving
the Company, its affiliates, agents, employees, officers,
directors, successors and assigns.
8. The following is hereby inserted as new Section 5 of the 1997
Contract:
5. Agreement is Voluntary and Knowing. Employee acknowledges she
understands the terms and conditions of this Agreement. Employee
has had the opportunity to discuss thoroughly all aspects of this
Agreement with Employee's legal counsel and has been advised to
do so by the Company. Employee is voluntarily entering into this
Agreement, of her own free will, free of any coercion, pressure
or duress. She is knowingly releasing Company in accordance with
the terms contained herein. Employee further acknowledges that
she is receiving consideration beyond anything of value to which
she is already entitled. Should Employee ever attempt to
challenge this Agreement, Employee will as a precondition return
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to the Company all consideration provided to Employee hereunder.
Employee will have up to twenty-one (21) days in which to
consider this Agreement. After the execution of this Agreement,
Employee will have an additional seven (7) days to revoke this
Agreement. Therefore, this Agreement will become final on the
eighth (8th) day after Employee has executed it. Notwithstanding
anything to the contrary stated in this Agreement, the Company
will not be required to make any payments or provide any benefits
or other consideration to the Employee until this Agreement
becomes final pursuant to the provisions of this Section 5.
9. Sections 3 through 9 and Sections 11 and 12 of the 1997 Contract
are hereby redesignated accordingly due to the insertions stipulated in
paragraphs 6, 7 and 8 of this Amendment. Section 10 appearing in the 1997
Contract is hereby deleted.
10. The following is hereby inserted as new Section 15 to the 1997
Contract:
15. Final Settlement. The parties declare that each has carefully
read this Agreement, as amended, that each has reviewed its terms
with each one's respective counsel, and that each agrees to it
for the purpose of making a full and final adjustment and
resolution of the matters addressed herein. Nothing in this
Agreement is to be construed as an admission of any kind by
either the Employee or the Company.
11. Other than as expressly set forth herein, all terms and
provisions of the 1997 Contract remain in full force and effect. This Amendment
will be interpreted under, subject to and governed by the laws of the State of
Tennessee and all questions concerning its validity, construction, and
administration will be determined in accordance therewith.
IN WITNESS WHEREOF, the parties have executed this Amendment No. To
Confidentiality, Non-Competition and Severance Pay Agreement as of the date
first above written.
"EMPLOYEE" "COMPANY"
AMERICAN HOMEPATIENT, INC.
/s/ Xxxxxx Xxxxxx 2/15/99 By: /s/ Xxxxxx X. Xxxxxxx, III
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XXXXXX XXXXXX
Title: President and Chief
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Executive Officer
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