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Exhibit 10.77
EMPLOYMENT AGREEMENT
AGREEMENT dated as of July 1, 1997, between UNISON HEALTHCARE
CORPORATION, a Delaware corporation ("Unison") and XXXXXXX XXXXXX ("Xxxxxx").
Unison wishes to employ Kloehr and Kloehr wishes to be employed by
Unison, in each case, pursuant to the terms and subject to the conditions
hereof.
Accordingly, the parties hereto hereby agree as follows:
1. Employment and Duties. Unison hereby employs Kloehr as its Senior
Vice President and Treasurer, and Kloehr hereby accepts such employment. Kloehr,
who shall devote all his business time and attention to the business of Unison,
shall have general responsibility for the treasury, accounts receivable,
purchasing and financial analysis functions within Unison and shall perform such
additional duties and exercise such additional authority as may be assigned to
him from time to time by the Chief Executive Officer (the "CEO"), the Chief
Financial Officer (the "CFO") or the Board of Directors (the "Board") of Unison.
2. Term. The term of this Agreement shall commence on the date
hereof and continue until June 30, 1999.
3. Compensation. (a) Base Salary. Unison shall pay Kloehr a salary,
before deducting all applicable withholdings, at the annual rate of $140,000,
payable in accordance with Unison's standard executive payroll policies as in
effect from time to time. Unison shall consider increases in the annual rate of
such salary to be effective on January 1 of each year commencing January 1,
1998.
(b) Incentive Bonus. Kloehr shall be entitled to participate on
terms no less favorable than are extended to any other participant in such cash
and stock incentive compensation programs for key employees as may be adopted
from time to time by the Board. In case of the Board's failure to adopt or
maintain any such programs, Kloehr shall be entitled, in any event, to be
considered no less frequently than annually for a cash bonus of up to 40% of his
then annual base salary based on Unison's overall financial performance and
Kloehr's overall performance
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during each fiscal year (being the calendar year) commencing with 1997. Any such
bonus shall be payable as soon as practicable following the end of the fiscal
year, but in no event earlier than the date that follows by 30 days the filing
of Unison's annual report on Form 10-K for such year.
(c) Stock Options. Kloehr shall be granted not later than August 27,
1997, options to acquire 25,000 shares of the Common Stock of Unison. Such
options, which shall be in addition to and not in lieu of any options as would
otherwise be granted to Kloehr under any compensation program referred to in
Section 3(b), shall vest 12,500 on June 30, 1998, and 12,500 on June 30, 1999,
or, if earlier, on the date of any Change of Control (as defined in Section
6(b)) and shall otherwise be subject to Unison's standard terms of grant.
4A. Expenses. (a) Interim Living Expenses. Unison acknowledges that
for a period commencing on the date hereof and continuing until Kloehr relocates
to Scottsdale, Arizona, but not later than December 31, 1997, (the "Interim
Period"), Kloehr intends to continue to live in Arlington, Texas. During the
Interim Period, Kloehr shall commute to Scottsdale from Arlington each week.
Kloehr shall be entitled to be reimbursed by Unison for, all reasonable expenses
incurred by him during the Interim Period in connection with his transportation
between Arlington and Scottsdale and lodging and meals while in Scottsdale.
Kloehr shall use his reasonable best efforts to minimize the amount of such
expenses by, for example and when practicable, purchasing airline tickets at
least 21 days in advance of travel.
(b) Moving Expenses. Unison shall pay or reimburse Kloehr for the
reasonable costs of Kloehr's relocation of his principal residence to the
Scottsdale area, provided such relocation occurs no later than December 31,
1997, consistent with Unison's standard relocation assistance policy.
(c) Other Reimbursable Expenses. Unison shall also, upon receipt of
standard documentation, reimburse Kloehr each month for his reasonable travel
and lodging (outside the Scottsdale area) and other ordinary and necessary
business expenses consistent with Unison's expense reimbursement policies as in
effect from time to time.
4B. Benefits. Unison shall provide Kloehr and his dependents with
health, medical and life insurance, and make payments for Kloehr's account to
such retirement plan or plans as
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it may from time to time adopt, in each case, in a manner consistent with its
treatment from time to time of other senior executive officers.
5. Vacation. Kloehr shall be entitled to vacation with pay in
accordance with Unison's vacation policy as in effect from time to time and to
such paid holidays as Unison may approve for its executive personnel.
6. Termination. The Board may terminate Kloehr's employment
hereunder prior to the expiration of the term hereof in the manner provided in
either Section 6(a) or Section 6(b). Kloehr may terminate his employment
hereunder at any time effective upon Unison's receipt of at least 30 days'
advance notice to such effect.
(a) For Cause. Unison may terminate this Agreement for cause upon
notice to Kloehr stating the facts constituting such cause, provided that Kloehr
shall have 30 days following such notice to cure any conduct or act, if curable,
alleged to provide grounds for termination for cause hereunder. Cause shall
include material neglect of duties, willful failure to abide by legal and
ethical instructions or policies from or set in good faith by the Board, CEO or
CFO, commission of a felony or serious misdemeanor offense or pleading guilty or
nolo contendere to same, the commission by Kloehr of an act of dishonesty or
moral turpitude involving Unison, Kloehr's breach of this Agreement in any
material respect, the filing of bankruptcy proceedings by or against Kloehr or
breach by Kloehr of any other material obligation to Unison.
(b) Without Cause. Unison may terminate this Agreement at any time
immediately, without cause, effective upon Kloehr's receipt of notice to such
effect. Upon termination under this Section 6(b), Unison shall pay to Kloehr:
(i) forthwith, the base salary due him through the date of termination, (ii) in
equal semimonthly installments over the following 12 months, an amount equal to
his then base salary for one year and (iii) within 90 days following the end of
the fiscal year in which termination occurs, a bonus in an amount determined in
the manner described in Section 3(b), in each case, less applicable
withholdings.
The provisions of this Section 6(b) shall also apply if Kloehr's
employment with Unison is terminated, for any reason or
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for no reason, after a Change in Control. The provisions of this Section 6(b)
shall not apply, however, if, absent a Change of Control, Kloehr elects to
terminate his employment hereunder as contemplated by the second sentence of
Section 6 or should die or become disabled.
A Change of Control shall be deemed to have occurred if (i) a merger
or consolidation of Unison with any other corporation results in effective
control of Unison becoming vested in a corporation which is not under the
control of Unison's Board as constituted immediately prior to effectiveness of
such merger or consolidation, (ii) a complete or partial liquidation of Unison
is completed, or (iii) all or substantially all of Unison's assets are sold or
otherwise disposed of.
(c) Disability. If during the term of this Agreement, Kloehr fails
to perform his duties hereunder because of illness or other incapacity for a
period of three consecutive months, Unison shall have the right to terminate
this Agreement without further obligation hereunder except for any bonus amount
payable in accordance with this Section 6(c) and any amounts payable pursuant to
disability plans generally applicable to executive employees. Within 90 days
after the end of the fiscal year in which termination pursuant to this Section
6(c) occurs, Kloehr shall be entitled to receive a bonus payment as provided in
Section 6(b).
(d) Death. If Kloehr dies during the term of this Agreement, this
Agreement shall terminate immediately, and Kloehr's legal representatives shall
be entitled to receive the base salary due Kloehr for 60 days following death,
and any other death benefits generally applicable to executive employees. In
addition, within 90 days after the end of the fiscal year in which Kloehr's
death occurs, Kloehr's legal representative shall also be entitled to receive a
bonus payment as provided in Section 6(b).
7. Confidential Information; Non-Solicitation. (a) Confidential
Information. Kloehr acknowledges that Kloehr may receive, or contribute to the
production of, Confidential Information. For purposes of this Agreement, Kloehr
agrees that "Confidential Information" shall mean information or material
proprietary to Unison or designated as confidential information by Unison and
not generally known by non-Unison personnel, which Kloehr develops or to which
Kloehr obtains knowledge or access to
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through or as a result of Kloehr's relationship with Unison (including
information conceived, originated, discovered or developed in whole or in part
by Kloehr). Confidential Information includes, but is not limited to , the
following types of information and other information of a similar nature
(whether or not reduced to writing) related to Unison's business: discoveries,
inventions, ideas, concepts, research, development, processes, procedures,
"know-how", formulae, marketing techniques and materials, marketing and
development plans, business plans, customer names and other information related
to customers, price lists, pricing policies, methods of operation, financial
information, employee compensation, and computer programs and systems. Kloehr
acknowledges that the Confidential Information derives independent economic
value, actual or potential, from not being generally known to, and not being
readily ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use. Information publicly known without breach of
this Agreement that is generally employed by the trade at or after the time
Kloehr first learns of such information, or generic information or knowledge
which Kloehr would have learned in the course of his employment or work
elsewhere in the trade, shall not be deemed part of the Confidential
Information. Kloehr further agrees:
(1) To furnish Unison on demand, at any time during or after
employment, a complete list of the names and addresses of all present, former
and potential suppliers, financing or leasing sources, patients, customers and
other contacts gained while an employee of Unison in Kloehr's possession,
whether or not in the possession or within the knowledge of Unison.
(2) That all notes, memoranda, documentation and records in any way
incorporating or reflecting any Confidential Information shall belong
exclusively to Unison, and Kloehr agrees to turn over all copies of such
materials in Kloehr's control to Unison upon request or upon termination of
Kloehr's employment with Unison.
(3) That while employed by Unison and thereafter Kloehr will hold in
confidence and not directly or indirectly reveal, report, publish, disclose or
transfer any of the Confidential Information to any person or entity, or utilize
any of the Confidential Information for any purpose, except in the course of
Kloehr's work for Unison.
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(4) That any idea in whole or in part conceived of or made by Kloehr
during the term of his employment, consulting or similar relationship with
Unison which relates directly or indirectly to Unison's current or planned lines
of business and is made through the use of any of the Confidential Information
of Unison or any of Unison's equipment, facilities, trade secrets or time, or
which results from any work performed by Kloehr for Unison, shall belong
exclusively to Unison and shall be deemed a part of the Confidential Information
for purposes of this Agreement. Kloehr hereby assigns and agrees to assign to
Unison all rights in and to such Confidential Information whether for purposes
of obtaining patent or copyright protection or otherwise. Kloehr shall
acknowledge and deliver to Unison (but at its expense) such written instruments
and do such other acts, including giving testimony in support of Kloehr's
authorship or inventorship, as the case may be, necessary in the opinion of
Unison to obtain patents or copyrights or to otherwise protect or vest in Unison
the entire right and title in and to the Confidential Information.
(b) Non-Solicitation. During the term of Kloehr's employment by
Unison and for a period of one year thereafter, Kloehr agrees that he shall not
(for the purpose of or which results in competition with Unison or any of its
affiliates or subsidiaries) either solicit any past or existing customers,
leasing or financing sources, patients, clients, suppliers, or business
patronage of Unison or any of its predecessors, affiliates or subsidiaries or
use any Confidential Information; nor will he solicit for any purpose the
employment of any employees of Unison or any of its affiliates or subsidiaries.
(c) Injunctions. It is agreed that the restrictions contained in
this Section 7 are reasonable, but it is recognized that damages in the event of
the breach of any of the restrictions will be difficult or impossible to
ascertain; and, therefore, Kloehr agrees that, in addition to and without
limiting any other right or remedy Unison may have, Unison shall have the right
to an injunction against Kloehr issued by a court of competent jurisdiction
enjoining any such breach without showing or proving any actual damage to
Unison.
(d) Part of Consideration. Kloehr also agrees, acknowledges,
convenants, represents and warrants that he is fully and completely aware that,
and further understands that, the foregoing restrictive covenants are an
essential part of the
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consideration for Unison entering into this Agreement and that Unison is
entering into this Agreement in full reliance on these acknowledgments,
covenants, representations and warranties.
(e) Time and Territory Reduction. If the period of time and/or
territory affected by the provisions of this Section 7 are held to be in any
respect an unreasonable restriction, it is agreed that the court so holding may
reduce the territory to which the restriction pertains or the period of time in
which it operates or may reduce both such territory and such period, to the
minimum extent necessary to render such provision enforceable.
(f) Survival. The obligations described in this Section 7 shall
survive any termination of this Agreement or any termination of the employment
relationship created hereunder.
8. Governing Law and Venue. Arizona law shall govern the
construction and enforcement of this Agreement and the parties agree that any
litigation pertaining to this Agreement shall be in courts located in Maricopa
County, Arizona.
9. Construction. The language in all parts at this Agreement shall
in all cases be construed as a whole according to its fair meaning and not
strictly for or against any party. The section headings contained in this
Agreement are for reference purposes only and will not affect in any way the
meaning or interpretation of this Agreement. All terms used in one number or
gender shall be construed to include any other number or gender as the context
may require. The parties agree that each party has reviewed this Agreement and
has had the opportunity to have counsel review the same and that any rule of
construction to the effect that ambiguities are to be resolved against the
drafting party shall not apply in the interpretation of this Agreement or any
amendment hereto.
10. Nondelagability of Kloehr's Rights and Unison's Assignment
Rights. The obligations, rights and benefits of Kloehr hereunder are personal
and may not be delegated, assigned or transferred in any manner whatsoever, nor
are such obligations, rights or benefits subject to involuntary alienation,
assignment or transfer. This Agreement shall be assigned automatically to any
entity merging with or acquiring Unison or its business.
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11. Severability. In the event any term or provision of this
Agreement is declared by a court of competent jurisdiction to be invalid or
unenforceable for any reason, this Agreement shall remain in full force and
effect, and either (a) the invalid or unenforceable provision shall be modified
to the minimum extent necessary to make it valid and enforceable or (b) if such
a modification is not possible, this Agreement shall be interpreted as if such
invalid or unenforceable provision were not a part hereof.
12. Attorneys' Fees. Except as otherwise provided herein, in the
event any party hereto institutes an action or other proceeding to enforce any
rights arising out of this Agreement, the party prevailing in such action or
other proceeding shall be paid all reasonable costs and attorneys' fees by the
non-prevailing party, such fees to be set by the court and not by a jury and to
be included in any judgment entered in such proceeding.
13. Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed duly given upon receipt if either personally
delivered, sent by certified mail, return receipt requested, or sent by a
nationally-recognized overnight courier service, addressed to the parties as
follows:
If to Unison: Unison HealthCare Corporation
0000 X. Xxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: General Counsel
If to Kloehr: Xxxxxxx Xxxxxx
Unison HealthCare Corporation
0000 X. Xxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
or to such other address as either party may provide to the other in accordance
with this Section.
14. Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior or contemporaneous understandings or agreements in regard
thereto. No waiver of any rights under this Agreement shall be valid unless in
writing and signed by the party to be charged with such waiver. No waiver of any
term or condition contained in this Agreement shall be deemed
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or construed as a further or continuing waiver of such term or condition unless
the waiver specifically provides otherwise.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
UNISON: KLOEHR:
UNISON HEALTHCARE CORPORATION ________________________
Xxxxxxx Xxxxxx
By: __________________________
Xxxxx X. Xxxxxxx
Chairman of the Executive
Committee
