EXHIBIT 10.12
AGREEMENT
THIS AGREEMENT is made by and between James D. Bohanon ("Bohanon"
or "Employee") and Columbia Healthcare Corporation, a Delaware corporation and
the successor of Columbia Hospital Corporation, a Nevada corporation
(individually or jointly "Columbia").
W I T N E S S E T H :
WHEREAS, Bohanon has entered into that certain employment
agreement, dated September 1, 1993, regarding his employment with Columbia
(the "Columbia Employment Agreement"); and
WHEREAS, Bohanon has agreed to relinquish his position as Co-Chief
Operating Officer of Columbia; and
WHEREAS, the parties desire to enter into this Agreement to modify,
preserve and secure certain of Bohanon's benefits under the Columbia
Employment Agreement;
NOW, THEREFORE, in consideration of the foregoing and of the
respective covenants and agreements of the parties herein contained and other
valuable consideration, the parties agree as follows:
1. TERMINATION OF EMPLOYMENT. Employee agrees to resign his
employment with Columbia.
2. CONFIDENTIAL INFORMATION.
(i) Employee recognizes and acknowledges that during the term of
employment Employee will develop, have access to and come into
possession of trade secrets and confidential information of Columbia,
including, without limitation, software systems, specifications,
programs and documentation, the methods and data which Columbia owns,
plans or develops, whether for its own use or for use by its clients,
developments, designs, inventions and improvements, trade secrets and
works of authorship, customer lists, supplier lists, proposals,
marketing plans and procedures, all of which are confidential and are
the property of Columbia. Employee further recognizes and acknowledges
that in order to enable Columbia to perform services for its customers,
those customers may furnish to Columbia confidential information
concerning their business affairs, property, methods of operation or
other data and that the goodwill afforded to Columbia and its employees
requires keeping such services and information confidential. All of
these
materials and information including, without limitation, those relating
to Columbia's systems and customers, will be referred to below as
"Proprietary Information."
(ii) Employee agrees that during the term of Employee's
employment with Columbia and thereafter, Employee will keep any and all
Proprietary Information confidential and will not disclose any
Proprietary Information, directly or indirectly, to any third person or
entity, without the prior written consent of Columbia. Employee further
agrees that, during the term of Employee's employment with Columbia and
thereafter, Employee will not use, handle, copy or duplicate, in part
or in whole, any Proprietary Information, except as directed by Columbia
and in the ordinary course of Columbia's business. This confidentiality
covenant has no temporal, geographic or territorial restriction.
(iii) Employee agrees that upon request by Columbia, and in any
event immediately upon termination of Employee's employment, Employee
shall turn over to Columbia all property, keys, notes, memoranda,
writings, lists, files, reports, customer lists, correspondence, tapes,
software, cards, surveys, maps, logs, machines, technical data, work
product or any other tangible product or document which has been
produced by, received by or otherwise submitted or made available to
Employee during or prior to Employee's employment with Columbia.
(iv) Employee understands and agrees that all Proprietary
Information is and shall remain the property of Columbia and that
Employee has not and will not appropriate for Employee's own use or for
the use of any third party any Proprietary Information. Furthermore,
Employee hereby assigns or agrees to assign to Columbia or its
subsidiaries or affiliates, as appropriate, its successors, assigns or
nominees, Employee's entire right, title and interest in any
developments, designs, patents, inventions and improvements, trade
secrets, trademarks, copyrightable subject matter or other Proprietary
Information which Employee has made or conceived, or may make or
conceive, either solely or jointly with others, while providing services
to Columbia, or with the use of time, material or facilities of Columbia
or relating to any actual or anticipated business, research,
development, product, service or activity of Columbia known to Employee
while employed at Columbia, or suggested by or resulting from any task
assigned to Employee or work performed by Employee for or on behalf of
Columbia, whether or not such work was performed prior to the date of
this Agreement.
(v) For purposes of the foregoing, service by the Employee with
Galen and Humana Inc. prior to the Effective Time will be deemed service
with Columbia.
3. COVENANT NOT TO COMPETE. Employee agrees that because of the
confidential and sensitive nature of the Proprietary Information and
because the use of, or even the appearance of the use of, the
Proprietary Information in certain circumstances may cause irreparable
damage to Columbia and its reputation, or to customers of Columbia,
Employee will not, from the date of this Agreement until the expiration
of one (1) year after the date on which Employee's employment with
Columbia terminates for any reason, directly or indirectly, own, manage,
operate, join, control,
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be employed by, or participate in the ownership, management, operation
or control of or be connected in any manner, including as director,
officer, consultant, independent contractor, employee, partner, or
investor with any business, enterprise, organization or other individual
or entity which solicits business, performs services or delivers goods
that are comparable to or competitive with any business of Columbia;
provided, however, that the ownership of less than five percent (5%) of
the outstanding capital stock of any entity with securities registered
pursuant to Section 12 of the Securities Exchange Act of 1934, as
amended, shall not be prohibited by this Section 4.
4. NON-SOLICITATION. Employee agrees that during the term of
Employee's employment with Columbia and for a period of three (3) years
thereafter, Employee will not interfere with Columbia's relationship
with, or endeavor to employ or entice away from Columbia, any business,
enterprise, organization or other individual or entity, which is an
employee, customer or supplier of Columbia, or which maintains a
business relationship with any business of Columbia.
5. BENEFITS ON AND AFTER TERMINATION . In consideration of Bohanon's
promises contained herein and his termination as an employee of
Columbia, and in fulfillment of Columbia's obligations under the
Columbia Employment Agreement, the parties agree to the following:
(i) At the time of Bohanon's resignation, he shall be paid a lump
sum cash payment equal to Fifty-Three Thousand Eight Hundred and Fifty
Dollars ($53,850.00) multiplied by the number of months (and fraction
thereof), remaining between the effective date of Bohanon's resignation
and February 28, 1998.
(ii) Columbia shall continue to carry at its expense life insurance
coverage on Bohanon's life to age sixty-five (65) in the amount of One
Million, Seventy-Five Thousand Dollars ($1,075,000.00) payable to
Bohanon's beneficiary.
(iii) Columbia shall continue health insurance coverage for Bohanon
and his family, under an insured health program available to Columbia
employees, until Bohanon's age sixty-five (65). The cost to Bohanon for
such coverage shall be the cost under the Consolidated Omnibus Budget
Reconciliation Act (COBRA) minus the cost for such coverage Columbia
would pay if Bohanon were an employee. (i.e. The normal Company portion
shall be paid by the Company.) Bohanon's spouse shall also be entitled,
as Bohanon's dependent, to continuation of health insurance coverage
until she reaches age sixty-five (65) under the same plans as Bohanon
and subject to the same terms and cost of coverage under those plans as
Bohanon, however once Bohanon reaches the age of sixty-five and is
entitled to coverage under Medicare (or its successor), he shall not be
entitled to dependent coverage under his spouse's coverage.
(iv) There shall be immediate and full vesting of any of Bohanon's
stock options which are not otherwise exercisable or payable as of the
date of termination of employment. Bohanon shall be treated as retiring
from the employ of the Company
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so that such stock options and any other vested but unexercised options
shall not expire until two years from the date of such retirement. This
paragraph shall not apply to the SARs referenced in subparagraph (v)
below.
(v) Bohanon is hereby granted stock appreciation rights with respect
to 300,000 shares of Columbia Common Stock (the "Shares") at an exercise
price ("Exercise Price") of $27.1875 per share (the "SARs"). The SARs
are fully exercisable and shall expire August 31, 1997. Upon exercise
of an SAR, Employee shall be entitled to receive an amount, payable in
cash, determined by multiplying (A) the excess of the fair market value
of a Share on the date of exercise over the Exercise Price by (B) the
number of Shares as to which the SAR is being exercised (for this
purpose fair market value of a Share shall be the average between the
high and the low trading prices of a Share on the principal exchange on
which the Shares are traded). Notwithstanding the foregoing, for the
one (1) year period between September 1, 1994 and up to and including
August 31, 1995, Bohanon may, at his sole discretion, relinquish the
SARs described herein and receive in lieu thereof a lump sum payment of
one million dollars ($1,000,000) plus an additional amount sufficient to
enable Bohanon to pay all federal, state and local taxes resulting from
his receipt of such payment so that Bohanon will receive an amount, net
of all taxes, equal to one million dollars ($1,000,000) (the
"Alternative Cash Payment"). For this purpose, the amount of the
Alternative Cash Payment will be determined assuming Bohanon's effective
federal, state and local tax rates are the highest marginal tax rate
applicable. In the event of Bohanon's death or disability, the SARs
shall be exercisable by the person or persons to whom those rights pass
by will or by the laws of descent and distribution or if appropriate by
the legal representative of Bohanon or his estate under the same terms
contained herein.
6. BINDING EFFECT. This Agreement and any amendments hereto shall be
binding upon and inure to the benefit of the parties hereto and their
successors and assigns.
7. PRIOR AGREEMENT. Upon Bohanon's resignation as an employee of
Columbia, this agreement shall supersede the Columbia Employment
Agreement.
8. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the Commonwealth of Kentucky without
regard to its rules of conflict of laws. The parties hereby irrevocably
and unconditionally consent to submit to the exclusive jurisdiction of
the courts of the Commonwealth of Kentucky and of the United States of
America located in the Commonwealth of Kentucky for any litigation
arising out of or relating to this Agreement and the transactions
contemplated hereby; and agree not to commence any litigation relating
thereto except in such courts.
9. SEVERABILITY. Any term or provision of this Agreement which
is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the
remaining terms and provisions of this Agreement or affecting the
validity or enforceability of any of the terms or provisions of this
Agreement in any
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other jurisdiction. If any provision of the Agreement is so broad as to
be unenforceable, the provision shall be interpreted to be only so broad
as is enforceable.
IN WITNESS WHEREOF, Columbia has caused this Agreement to be executed
by its duly authorized officer and Bohanon has executed this Agreement,
each as of the day and year set forth below.
COLUMBIA HEALTHCARE CORPORATION
Date: ______________________ By: ___________________________________
Richard L. Scott
President and
Chief Executive Officer
Date: ______________________ Employee: _____________________________
James D. Bohanon
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AGREEMENT
THIS AGREEMENT is made by and between James D. Bohanon ("Bohanon"
or "Employee") and Columbia Healthcare Corporation, a Delaware corporation and
the successor of Columbia Hospital Corporation, a Nevada corporation
(individually or jointly "Columbia").
W I T N E S S E T H :
WHEREAS, Bohanon has entered into that certain employment
agreement, dated August 31, 1993, regarding his employment with Columbia (the
"Columbia Employment Agreement"), which was modified and superseded by an
Agreement between the parties dated December 16, 1993 (the "Employment
Termination Agreement"); and
WHEREAS, Bohanon entered into that certain agreement dated February
15, 1993 with Galen Health Care, Inc. ("Galen") regarding termination benefits
following a change in control (the "Severance Protection Agreement") which
Columbia is obligated under as successor to Galen; and
WHEREAS, the parties desire to clarify Bohanon's benefits under
such agreements;
NOW, THEREFORE, in consideration of the foregoing and of the
respective covenants and agreements of the parties herein contained and other
valuable consideration, the parties agree that upon his resignation as an
employee of Columbia, Bohanon shall be entitled to the benefits under his
Severance Protection Agreement. However, notwithstanding the above, the
parties agree that Bohanon is not entitled to the benefits described in
Section 2(a)(3)(ii) of his Severance Protection Agreement.
IN WITNESS WHEREOF, Columbia has caused this Agreement to be
executed by its duly authorized officer and Bohanon has executed this
Agreement, each as of the day and year set forth below.
COLUMBIA HEALTHCARE CORPORATION
Date: ______________________ By: ___________________________________
Richard L. Scott
President and
Chief Executive Officer
Date: ______________________ Employee: _____________________________
James D. Bohanon
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