EXHIBIT 10.1
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made and entered into as of
the 18th day of April, 2006, by and between PER-SE TECHNOLOGIES, INC., a
Delaware corporation (the "Company"), and PATRICK J. LEONARD, a resident of the
Commonwealth of Virginia (the "Executive").
I. STATEMENT OF BACKGROUND INFORMATION
The Company, directly and through its direct and indirect subsidiary
corporations (hereinafter, "Subsidiaries"), provides comprehensive business
management outsourcing services to hospital-affiliated physician groups in the
specialties of radiology, anesthesiology, emergency medicine and pathology, as
well as physician groups practicing in academic settings and other large
physician groups. Services include clinical data collection, data input, medical
coding, billing, contract management, cash collections, accounts receivable
management and extensive reporting of metrics related to the physician practice,
plus physician practice management solutions delivered via an ASP model
(collectively, the "Physician Solutions Business").
In addition, the Company and its Subsidiaries provide electronic
clearinghouse services and point-of service systems for retail, mail order and
managed care pharmacies. Services include real-time processing related to claims
submission, eligibility verification, remittance advice, referral authorization,
drug formulary and inventory management, as well as claim status and tracking,
plus value-added transaction services and claims edits that perform financial
and administrative reviews of pharmacy transactions (collectively, the "Pharmacy
Solutions Business").
The Company and its Subsidiaries also provide revenue cycle and resource
management solutions to hospitals. Revenue cycle management solutions include
electronic processing of medical transactions as well as complementary
transactions, such as electronic remittance advices, real-time eligibility
verification and high-speed print and mail services, plus solutions to identify
and manage charges denied reimbursement by payers; resource management solutions
include enterprise-wide staff and patient scheduling software (collectively, the
"Hospital Solutions Business") (the Physician Solutions Business, the Pharmacy
Solutions Business and the Hospital Solutions Business are collectively referred
to herein as the "Business").
II. STATEMENT OF AGREEMENT
In consideration of the mutual covenants, promises and conditions set
forth in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. Employment. The Company hereby employs Executive and Executive hereby
accepts such employment upon the terms and conditions set forth in this
Agreement.
2. Duties of Executive. Executive's title will be President, Physician
Solutions of the Company, reporting to the Executive Vice President and
Chief Operating Officer of the
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Company. Executive agrees to perform and discharge such duties as may be
assigned to Executive from time to time by the Company to the reasonable
satisfaction of the Company. Executive also agrees to comply with all of
the Company's policies, standards and regulations as promulgated by the
executive officers of the Company, and to follow the lawful instructions
and directives of the Board of Directors of the Company, the Chairman,
President and Chief Executive Officer of the Company, and the Executive
Vice President and Chief Operating Officer of the Company. Executive will
devote Executive's full professional and business-related time, skills and
best efforts to such duties and will not, during the term of this
Agreement, be engaged or plan to be engaged (whether or not during normal
business hours) in any other business or professional activity, whether or
not such activity is pursued for gain, profit or other pecuniary
advantage, without the prior written consent of the Chairman, President
and Chief Executive Officer of the Company or the Executive Vice President
and Chief Operating Officer of the Company, which consent will not be
unreasonably withheld. This Section will not be construed to prevent
Executive from (a) investing personal assets in businesses which do not
compete with the Company in such form or manner that will not require any
services on the part of Executive in the operation or the affairs of the
companies in which such investments are made and in which Executive's
participation is solely that of an investor; (b) purchasing securities in
any corporation whose securities are listed on a national securities
exchange or regularly traded in the over-the-counter market, provided that
Executive at no time owns, directly or indirectly, in excess of one
percent (1%) of the outstanding stock of any class of any such corporation
engaged in a business competitive with that of the Company (this does not
apply to mutual fund investments); or (c) participating in conferences,
preparing and publishing papers or books or teaching, so long as the
Chairman, President and Chief Executive Officer of the Company or the
Executive Vice President and Chief Operating Officer of the Company
approves such participation, preparation and publication or teaching prior
to Executive's engaging therein.
3. Term. The term of this Agreement will be for a two (2) year period of
time, commencing as of the date hereof and expiring on the 2nd anniversary
hereof, subject to earlier termination as provided for in Section 4 of
this Agreement. This Agreement shall be automatically renewed for
successive one (1) year periods at the end of the initial term, unless
either party gives written notice to the other of its intent not to renew
this Agreement not less than ninety (90) days prior to the expiration of
the then current term. In the event such notice not to renew is properly
and timely given, this Agreement shall expire and thereby terminate at the
end of the initial term or the one-year renewal period in which such
notice is given.
4. Termination.
(a) Termination by Company for Cause. Notwithstanding anything contained
in Section 3 to the contrary, the Company may terminate this Agreement and
all of its obligations hereunder immediately if any of the following
events occur:
(i) Executive materially breaches any of the terms or conditions set
forth in this Agreement and, as to any breach capable of cure, fails
to cure such breach within ten (10) days after Executive's receipt
from the Company of written notice of such
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breach (notwithstanding the foregoing, no cure period shall be
applicable to breaches by Executive of Sections 6, 7 or 8 of this
Agreement);
(ii) Executive commits any other act materially detrimental to the
business or reputation of the Company or its Subsidiaries;
(iii) Executive commits or is convicted of any crime involving
fraud, deceit or moral turpitude; or
(iv) Executive dies or becomes mentally or physically incapacitated
or disabled so as to be unable to perform Executive's duties under
this Agreement. Without limiting the generality of the foregoing,
Executive's inability adequately to perform services under this
Agreement for a period of sixty (60) consecutive days will be
conclusive evidence of such mental or physical incapacity or
disability, unless such inability adequately to perform services
under this Agreement is pursuant to a mental or physical incapacity
or disability covered by the Family Medical Leave Act, in which case
such sixty (60)-day period shall be extended to a one hundred and
twenty (120)-day period.
(b) Termination by Company Without Cause. Notwithstanding anything
contained in Section 3 to the contrary, the Company may terminate
Executive's employment pursuant to this Agreement without cause upon at
least thirty (30) days' prior written notice to Executive. In the event
Executive's employment with the Company is terminated by the Company
without cause, Executive shall be entitled to severance consideration by
way of salary continuation at Executive's then-current monthly salary
(this severance consideration does not include the right to receive any
incentive bonus payments) for the greater of the number of months (i)
remaining in the initial or any renewal term of this Agreement or (ii)
twelve (12) months. In addition, during the period of salary continuation,
the Company shall pay to Executive monthly an amount equal to the
difference between the monthly cost to Executive of medical, dental and
vision coverage at the levels at which Executive is participating on the
date of termination and the monthly cost to Executive of COBRA coverage.
Any obligation of the Company to pay severance or any other similar
benefits, whether arising herein or in any other Section of this
Agreement, shall be contingent upon Executive entering into a full general
release of Company, its Subsidiaries and their officers, employees, agents
and other related parties, in a form satisfactory to Company.
(c) Termination by Executive With Good Reason. Except as set forth in
Paragraph (d) below, in the event Executive elects to voluntarily
terminate his employment following the occurrence of events constituting
"Good Reason" for his voluntary termination of employment, Executive shall
be entitled to the severance consideration specified in Paragraph 4(b),
above. For purposes of this Agreement, "Good Reason" is defined as (i) a
reduction of greater than 10% in Executive's annual base salary; (ii) a
change (absent Executive's agreement) in Executive's regular work location
to a work location more than 50 miles from Executive's existing work
location in the United States (necessary travel on the Company's business
shall not constitute such a change); (iii) an ongoing assignment to any
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duties inconsistent in any material adverse respect with Executive's then
current position, duties or responsibilities, other than an insubstantial
or inadvertent act; (iv) the failure by the Company to continue any
material benefit or compensation plan in which Executive is participating
unless Executive is provided with comparable plans or benefits; or (v) the
material breach by the Company of any of the terms and conditions set
forth in this Agreement. Prior to effecting a termination for Good Reason,
Executive must give Company written notice of the claimed existence of
Good Reason within 60 days of Executive becoming aware of such
circumstances. Thereafter, Company shall have 30 days, excluding the date
of receipt of such notice, to eliminate any circumstances within the scope
of the notice provided by Executive that in fact constitute Good Reason.
In the event such circumstances are not eliminated within the time
provided, Executive shall have 30 days subsequent to the running of the
cure period in which to exercise a right to resign for Good Reason on the
basis of the circumstances set forth in the subject notice.
(d) Change in Control. In the event (A) there is a Change in Control (as
defined herein) of the Company and Executive's employment is terminated by
the Company without cause within one (1) year following any such Change in
Control; (B) Executive's employment is terminated by the Company at the
request of or pursuant to an agreement with a third party who has taken
steps reasonably calculated to effect a Change in Control; (C) Executive's
employment is terminated by the Company in connection with or in
anticipation of a Change in Control; (D) Executive voluntarily terminates
his employment for Good Reason (as defined above in Paragraph (c) above)
within one (1) year following any such Change in Control; or (E) Executive
voluntarily terminates his employment for Good Reason within one (1) year
following any action taken by the Company at the request of or pursuant to
an agreement with a third party who has taken steps reasonably calculated
to effect a Change in Control or any action taken by the Company in
connection with or in anticipation of a Change in Control, in each case
which action constitutes Good Reason, then Executive will be entitled to
receive the severance consideration specified in Paragraph 4(b), above.
For purposes of this Agreement, a "Change in Control" of the Company shall
be deemed to occur upon any of the following:
(i) a consolidation or merger of the Company with or into any other
corporation, or any other entity or person, other than a
wholly-owned subsidiary of the Company, excluding any transaction in
which the shares of the Company's common stock outstanding
immediately prior to any such consolidation or merger represents
immediately thereafter more than 50% of the combined voting power of
the resulting entity after the transaction;
(ii) any corporate reorganization, including an exchange offer, in
which the Company shall not be the continuing or surviving entity
resulting from such reorganization, excluding any transaction in
which the number of shares of the Company's common stock outstanding
immediately prior to any such reorganization represents immediately
thereafter more than 50% of the combined voting power of the
resulting entity after the transaction; or
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(iii) the sale of a substantial portion of the Company's assets,
which shall be deemed to occur on the date that any one person, or
more than one person acting as a group, acquires (or has acquired
during the 12-month period ending on the date of the most recent
acquisition by such person or persons) assets from the Company that
(a) have a total fair market value equal to more than 50% of the
total fair market value of all the assets of the Company immediately
prior to such acquisition or acquisitions, or (b) represents a
majority of the common stock of any (1) subsidiary of the Company,
the revenues of which, in the most recent fiscal year, represent
more than 75% of the consolidated gross revenues of the Company and
its subsidiaries. Notwithstanding the foregoing, a transfer of
assets or common stock in a subsidiary by the Company will not be
treated as a sale of a substantial portion of the Company's assets
if the assets are transferred to an entity, 50% or more of the total
value or voting power of which is owned, directly or indirectly, by
the Company.
5. Compensation and Benefits.
(a) Annual Salary. During the term of this Agreement and for all services
rendered by Executive under this Agreement, the Company will pay Executive
a base salary of Three Hundred Twenty Five Thousand Dollars ($325,000.00)
per annum to be paid in accordance with the Company's regular payroll
practices. Such base salary will be subject to adjustments by any
increases given in the normal course of business.
(b) Incentive Compensation. Executive shall be eligible to participate in
the Company's 2006 Senior Management Incentive Compensation Plan (and any
comparable future incentive compensation plans during the term of this
Agreement) at a participation category of up to Eighty Percent (80%) of
Executive's then current annual base salary, payable at the discretion of
the Board of Directors of the Company.
(c) Stock Options or Other Equity-Based Compensation. Executive shall be
considered for grants of stock options or other equity-based compensation
in a manner that is consistent with other members of senior management of
the Company; however, nothing in this Agreement shall give Executive a
contractual right to receive such additional grants. Further, the Company
has no obligation to Executive to create parity with any other Company
employee or employees with respect to any stock options or other
equity-based compensation granted to such other employees.
(d) Other Benefits. Executive will be entitled to such fringe benefits as
may be provided from time-to-time by the Company to members of its senior
management, including, but not limited to, participation in the Company's
401(k) plan, group health insurance, life and disability insurance,
vacations and any other fringe benefits, in each case as now or hereafter
provided by the Company, if and when Executive meets the eligibility
requirements for any such benefit. The Company reserves the right to
change or discontinue any employee benefit plans or programs now being
offered to its employees; provided, however, that all benefits provided
for employees of the same position and status as Executive will be
provided to Executive on a comparable basis.
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(e) Business Expenses. Executive will be reimbursed for all reasonable
expenses incurred in the discharge of Executive's duties under this
Agreement pursuant to the Company's standard reimbursement policies.
(f) Withholding. The Company will deduct and withhold from the payments
made to Executive under this Agreement, state and federal income taxes,
FICA and other amounts normally withheld from compensation due employees.
6. Non-Disclosure of Proprietary Information. Executive recognizes and
acknowledges that the Trade Secrets (as defined below) and Confidential
Information (as defined below) of the Company and its Subsidiaries and all
physical embodiments thereof (as they may exist from time-to-time,
collectively, the "Proprietary Information") are valuable, special and
unique assets of the Company's and its Subsidiaries' businesses. Executive
further acknowledges that access to such Proprietary Information is
essential to the performance of Executive's duties under this Agreement.
Therefore, in order to obtain access to such Proprietary Information,
Executive agrees that Executive shall hold in confidence all Proprietary
Information and will not reproduce, distribute, disclose, publish or
otherwise disseminate any Proprietary Information, in whole or in part,
and will take no action causing, or fail to take any action necessary to
prevent causing, any Proprietary Information to lose its character as
Proprietary Information, nor will Executive make use of any such
information for Executive's own purposes or for the benefit of any person,
firm, corporation, association or other entity (except the Company and its
Subsidiaries) under any circumstances.
For purposes of this Agreement, the term "Trade Secrets" means
information, without regard to form, including, but not limited to, any
technical or non-technical data, formula, pattern, compilation, program,
device, method, technique, drawing, process, financial data, financial
plan, product plan, list of actual or potential customers or suppliers, or
other information similar to any of the foregoing, which is not commonly
known by or available to the public and (i) derives economic value, actual
or potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can derive economic
value from its disclosure or use, and (ii) is the subject of efforts that
are reasonable under the circumstances to maintain its secrecy. For
purposes of this Agreement, the term "Trade Secrets" does not include
information that Executive can show by competent proof (i) was known to
Executive and reduced to writing prior to disclosure by the Company (but
only if Executive promptly notifies the Company of Executive's prior
knowledge); (ii) was generally known to the public at the time the Company
disclosed the information to Executive; (iii) became generally known to
the public after disclosure by the Company through no act or omission of
Executive; or (iv) was disclosed to Executive by a third party having a
bona fide right both to possess the information and to disclose the
information to Executive. The term "Confidential Information" means any
information of the Company, other than trade secrets, which is valuable to
the Company and not generally known to competitors of the Company. The
provisions of this Section 6 will apply to Trade Secrets for so long as
such information remains a trade secret and to Confidential Information
during Executive's employment with
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the Company and for a period of two (2) years following any termination of
Executive's employment with the Company for whatever reason.
7.A. Non-Competition Covenant. During Executive's employment by the
Company, Executive will be a member of the Company's senior management
team and will regularly receive Proprietary Information regarding the
Business. Executive agrees that, during his employment and for a period of
one (1) year following any termination of Executive's employment for any
reason, Executive will not, directly or indirectly, on Executive's own
behalf or in the service of or on behalf of any other individual or
entity, compete within the Geographical Area (as hereinafter defined). The
term "compete" means to engage in, have (except as set out below) any
equity or interest in, or render services of any marketing, management,
sales, or management consulting nature, directly or indirectly, either as
a proprietor, employee, agent, independent contractor, consultant,
director, officer, partner or stockholder (other than a stockholder of a
corporation listed on a national securities exchange or whose stock is
regularly traded in the over-the-counter market, provided that Executive
at no time owns, directly or indirectly, in excess of one percent (1%) of
the outstanding stock of any class of any such corporation) any business
that provides products or services that are the same or substantially
similar to those of the Business. For purposes of this Agreement, the term
"Geographical Area" means the territory located within a fifty (50) mile
radius of the Company's headquarters location at 1145 Sanctuary Parkway,
Suite 200, Alpharetta, GA 30004 or within the same distance of each
facility of the Company or a Subsidiary for which Executive shall have
management responsibility at the outset of the term of this Agreement.
Executive acknowledges and agrees that he has the opportunity to become
and is, in fact, aware of the locations of all such facilities; Executive
acknowledges that he will be active in the management of all such
facilities (including personal visits to some or all); and that the
restrictions set forth in this subparagraph are reasonable and permit
Executive to determine at the outset of the term of this Agreement those
locations falling within the coverage of this subparagraph.
7.B. Non-Solicitation of Clients Covenant. Executive agrees that during
Executive's employment by the Company and for a period of two (2) years
following the termination of Executive's employment for whatever reason,
Executive will not, directly or indirectly, on Executive's own behalf or
in the service of or on behalf of any other individual or entity, divert,
solicit or attempt to divert or solicit any individual or entity (i) who
is a client of any Business operations for which Executive had management
responsibility during Executive's employment with the Company ("Client"),
or was actively sought thereby as a prospective client and (ii) with whom
Executive had material contact or obtained Proprietary Information about
within the last twelve (12) months of Executive's employment by the
Company, to provide to such Clients or prospects products or services that
are the same or substantially similar to those of the Business.
7.C. Construction. The parties hereto agree that any judicial authority
construing all or any portion of this Section 7 or Section 8 below shall
sever any term of such Sections found to render such Sections
unenforceable and shall replace each such severed provision with a
provision as similar in terms to such severed provision as may be possible
and be legal, valid
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and enforceable. The parties agree that the Court shall likewise enforce
all non-severed provisions. It is the intent of the parties that Sections
7 and 8 be enforced to the maximum extent permitted by law.
8. Non-Solicitation of Employees Covenant. Executive further agrees and
represents that during Executive's employment by the Company and for a
period of one (1) year following any termination of Executive's employment
for whatever reason, Executive will not, directly or indirectly, on
Executive's own behalf or in the service of, or on behalf of any other
individual or entity, divert or solicit, or attempt to divert or solicit,
to or for any individual or entity which is engaged in providing products
or services that are the same or substantially similar to those of the
Business, any person employed by the Company or a Subsidiary, whether or
not such employee is a full-time employee or temporary employee, whether
or not such employee is employed pursuant to written agreement and whether
or not such employee is employed for a determined period or at-will,
provided Executive had material contact with such employee within the last
twelve (12) months of Executive's employment.
9. Existing Restrictive Covenants. Executive represents and warrants that
Executive's employment with the Company does not and will not breach any
agreement which Executive has with any former employer or other individual
or entity to keep in confidence confidential information or not to compete
with any such former employer. Executive will not disclose to the Company
or use on its behalf any confidential information of any other party
required to be kept confidential by Executive.
10. Return of Proprietary Information. Executive acknowledges that as a result
of Executive's employment with the Company, Executive will come into the
possession and control of Proprietary Information, such as proprietary
documents, drawings, specifications, manuals, notes, computer programs, or
other proprietary material. Executive acknowledges, warrants and agrees
that Executive will return to the Company all such items and any copies or
excerpts thereof, in any form or medium, and any other properties, files
or documents obtained as a result of Executive's employment with the
Company, immediately upon the termination of Executive's employment with
the Company.
11. Proprietary Rights. During the course of Executive's employment with the
Company, Executive may make, develop or conceive of useful processes,
machines, compositions of matter, computer software, algorithms, works of
authorship expressing such algorithm, or any other discovery, idea,
concept, document or improvement which relates to or is useful to the
Business (the "Inventions"), whether or not subject to copyright or patent
protection, and which may or may not be considered Proprietary
Information. Executive acknowledges and agrees that all such Inventions
will be "works made for hire" under United States copyright law and will
otherwise be and remain the sole and exclusive property of the Company.
Executive also hereby assigns and agrees to assign to the Company, in
perpetuity, all right, title and interest Executive may have in and to
such Inventions, including without limitation, all copyrights, and the
right to apply for any form of patent, utility model, industrial design or
similar proprietary right recognized by any state, country or
jurisdiction. Executive further agrees, at the Company's request and
expense, to do all things and sign all documents or
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instruments necessary, in the opinion of the Company, to eliminate any
ambiguity as to the ownership of, and rights of the Company to, such
Inventions, including filing copyright and patent registrations and
defending and enforcing in litigation or otherwise all such rights.
Executive will not be obligated to assign to the Company any Invention
made by Executive while in the Company's employ which does not relate to
any business or activity in which the Company is or may reasonably be
expected to become engaged, except that Executive is so obligated if the
same relates to or is based on Proprietary Information to which Executive
will have had access during and by virtue of Executive's employment or
which arises out of work assigned to Executive by the Company. Executive
will not be obligated to assign any Invention which may be wholly
conceived by Executive after Executive leaves the employ of the Company,
except that Executive is so obligated if such Invention involves the
utilization of Proprietary Information obtained while in the employ of the
Company. Executive is not obligated to assign any Invention which relates
to or would be useful in any business or activities in which the Company
is engaged if such Invention was conceived and reduced to practice by
Executive prior to Executive's employment with the Company.
12. Remedies. Executive agrees and acknowledges that the violation of any of
the covenants or agreements contained in Sections 6, 7, 8, 9, 10 and 11 of
this Agreement would cause irreparable injury to the Company, that the
remedy at law for any such violation or threatened violation thereof would
be inadequate, and that the Company will be entitled, in addition to any
other remedy, to temporary and permanent injunctive or other equitable
relief without the necessity of proving actual damages or posting a bond.
Executive further agrees and acknowledges that, for the purpose of such
covenants and agreements and any such remedy, the Subsidiaries of the
Company shall be express third-party beneficiaries with a protectable
interest and independent right to enforce such provisions in order to
protect the business interests of such Subsidiaries.
13. Notices. Any notice or under this Agreement shall be in writing and shall
be sufficient if sent by hand delivery, registered or certified mail, or
commercial overnight delivery service addressed to the respective parties
as follows:
If to the Company: If to Executive:
Per-Se Technologies, Inc. Patrick J. Leonard
1145 Sanctuary Parkway 11512 Bell Tower Court
Suite 200 Richmond, VA 23233
Alpharetta, GA 30004
Attn: Chief Executive Officer
copy to: General Counsel
or such other address or agent as may be hereafter designated in writing
by either party hereto. All such notices shall be deemed given on the date
personally delivered (if by hand delivery) or when deposited for mail
delivery. All notices sent by other forms of delivery will be effective
upon receipt.
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14. Severability. Subject to the application of Section 7(C) to the
interpretation of Sections 7 and 8, in case one or more of the provisions
contained in this Agreement is for any reason held to be invalid, illegal
or unenforceable in any respect, the parties agree that it is their intent
that the same will not affect any other provision in this Agreement, and
this Agreement will be construed as if such invalid or illegal or
unenforceable provision had never been contained herein. It is the intent
of the parties that this Agreement be enforced to the maximum extent
permitted by law.
15. Entire Agreement. This Agreement embodies the entire agreement of the
parties relating to the subject matter of this Agreement and supersedes
all prior agreements, oral or written, regarding the subject matter
hereof. No amendment or modification of this Agreement will be valid or
binding upon the parties unless made in writing and signed by the parties.
16. Binding Effect. This Agreement will be binding upon the parties and their
respective heirs, representatives, successors, transferees and permitted
assigns.
17. Assignment. This Agreement is one for personal services and will not be
assigned by Executive. The Company may assign this Agreement to any of its
subsidiaries or affiliated companies, provided that the parent or any
subsidiary or affiliate fulfills the obligations of the Company under this
Agreement.
18. Governing Law. This Agreement is entered into and will be interpreted and
enforced pursuant to the laws of the State of Georgia, and any and all
disputes arising under the terms of this Agreement shall be resolved in a
court of competent jurisdiction in the State of Georgia, the parties
consenting to personal jurisdiction and venue of the courts of such State.
Notwithstanding the foregoing, any dispute related to enforcement or
interpretation of Section 7 or Section 8 of this Agreement shall be
resolved in a court of competent jurisdiction located in the state of
residence of the Executive as set out above, and the parties hereby
consent to the personal jurisdiction and venue of the courts of such
State; such courts shall serve as the exclusive forum for resolution of
any such disputes.
19. Indemnification. Executive shall be entitled to indemnification by the
Company as provided for in the Company's Restated Certificate of
Incorporation and Restated By-laws, as amended.
20. Surviving Terms. Sections 6, 7, 8, 9, 10, 11 and 12 of this Agreement
shall survive any termination of this Agreement.
21. Conditions Precedent. This Agreement shall not be effective until duly
executed by Executive and by the Chairman, President and Chief Executive
Officer of the Company.
22. Code Section 409A. Notwithstanding anything in the Agreement to the
contrary, to the extent that any amount or benefit that would constitute
"deferred compensation" for purposes of Section 409A of the Internal
Revenue Code of 1986, as amended (the "Code") would
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otherwise be payable or distributable under the Agreement by reason of the
Executive's separation from service, then, to the extent necessary to
comply with Code Section 409A (as determined by the Company acting in good
faith), such amount or benefit will not be payable or distributable to
Executive by reason of such circumstance until the six (6) month
anniversary of such separation from service.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
COMPANY: EXECUTIVE:
By: /s/ PHILIP M. PEAD /s/ PATRICK J. LEONARD
------------------------------- ----------------------
Philip M. Pead Patrick J. Leonard
Chairman, President
and Chief Executive Officer
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EXHIBIT A
INVENTIONS
Executive represents that there are no Inventions.
PJL
-------------------------
Executive's Initials
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