UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
March 2, 2009 (February 25, 2009)
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DIALYSIS CORPORATION OF AMERICA
(Exact name of registrant as specified in its charter)
Florida 0-8527 59-1757642
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1302 Concourse Drive, Suite 204, Linthicum, MD 21090
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (410) 694-0500
______________
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
On February 25, 2009, the Company entered into four employment
agreements with its executive officers effective January 1, 2009. The
officers are currently employed by the Company, certain of whom have been
affiliated with the Company for many years. The employment agreements
memorialized the arrangements each of the officers have with the Company.
The four agreements include Andrew Jeanneret, Vice President, Finance and
Chief Financial Officer (current base salary $220,000), Thomas P. Carey, Vice
President, Operations (current base salary $180,000), Joanne Zimmerman, Vice
President, Clinical Services and Compliance Officer (current base salary
$180,000), and Daniel R. Ouzts, Vice President, Finance (current base salary
$170,000). The employment agreements provide for discretionary annual
bonuses as recommended by the President and CEO to the Compensation
Committee, which Committee may, in turn, adjust, reject and/or approve such
bonus recommendations for full board consideration. Each officer is eligible
to participate in medical, accident, disability, life insurance, option,
profit sharing and such other employee benefit programs available to all
executive officers.
During the term of the agreements, the Company shall reimburse the
officers for reasonable out-of-pocket costs and expenses incurred in
connection with the performance of their duties and responsibilities to the
Company.
Each employment agreement is for a three (3) year period, from January
1, 2009 to December 31, 2011, with automatic one (1) year renewals, unless
either the Company or the officer provides timely notice of non-renewal.
Early termination may occur upon death, disability, or by the Company without
cause, or by the officer for good reason (as those terms are defined in the
employment agreement). Upon any such occurrence the officer will be entitled
to one year payment of the then base salary and benefits from the date of
termination, payable over the 12 month period. These sums will be paid in a
lump sum upon a change in control (as defined in the employment agreement),
provided that either the officer chooses not to continue with the surviving
or acquiring company, or the acquiring or surviving company does not wish to
continue any affiliation with the officer. The Company's obligation for any
payments upon termination by the Company without cause or by the officer for
good reason is conditional upon the officer providing the Company with a
release from all claims related to the employment. The only compensation
obligation upon the Company for termination of an officer for cause is a lump
sum payment for salary and annual bonus, if any, to the date of termination.
Each employment agreement contains restrictions on the officer's
ability, during the term and for a one (1) year subsequent period, to use or
disclose confidential information or trade secrets of the Company, to engage
in restricted activity (as defined in the agreement), which generally relates
to providing services that are competitive with the Company, and to solicit
or induce patients, management personnel, or any employee to terminate their
relationship with the Company.
The foregoing description of the executive officers' employment
agreements does not purport to be complete, and is qualified in its entirety
by reference to the complete text of each employment agreement, copies of
which are attached as exhibits to this Current Report on Form 8-K.
At the time of the above described employment agreements, the Company
entered into Indemnification Agreements with each of its officers and
directors. Florida law provides for indemnification and allows companies to
contract with officers and directors for indemnification. The
Indemnification Agreement provides for the Company to indemnify the
Indemnitee if the Indemnitee is a party to or threatened to be made a party
to any Proceeding (broadly defined to include, among others,
any threatened, pending or completed action, arbitration, investigation,
alternate dispute resolution mechanism, inquiry or administrative hearing) by
virtue of his Corporate Status (defined in the Agreement as an officer,
director, employee or agent of the Company or other Enterprise, which term is
defined as any other corporation or partnership that Indemnitee was serving
at the request of the Company) for all Expenses (defined to include, among
others, reasonable attorney's fees, court costs, expert fees, and related
costs) and judgments, penalties, fines and settlements in connection with any
such Proceeding (or appeal). Indemnification is only authorized if the
Indemnitee acted in good faith and in a manner Indemnitee reasonably believed
to be in, or not opposed to, the best interests of the Company, and with
respect to any criminal action, had no reasonable cause to believe the
Indemnitee's conduct was unlawful. The Indemnification Agreement provides
for a presumption that the Indemnitee acted properly. The Indemnitee is
further entitled to indemnification for Expenses and amounts paid in
settlement not exceeding, in the judgment of the board of directors, the
estimated Expenses of litigating the Proceeding to conclusion, if made a
party or threatened to be made a party to any Proceeding brought by or in the
right of the Company. However, the Company is not obligated for
indemnification if Indemnitee shall have been adjudged to be liable, unless a
court of competent jurisdiction determines, upon Indemnitee's application,
despite the adjudication of such liability, that the Indemnitee is entitled
to indemnification. If Indemnitee is partially successful on the merits,
indemnification will apply to that extent.
The Indemnitee also obtains indemnification for Expenses to the extent
Indemnitee is, by reason of his Corporate Status, a witness, or is asked to
respond to discovery requests, in any Proceeding in which Indemnitee is not a
party.
The Company, prior to the disposition of any Proceeding, shall advance
all reasonable Expenses incurred by the Indemnitee in defending any civil or
criminal Proceeding upon Indemnitee's written request, provided the
Indemnitee undertakes to repay such advanced Expenses if it is determined
that Indemnitee is not entitled to such indemnification.
The Indemnification Agreement provides for the determination for
entitlement to indemnification in a particular Proceeding by the majority
vote of the disinterested members of the board of directors or a committee of
the board (having at least two disinterested directors), and if no such
committee is available, then by Independent Counsel (generally defined in the
Indemnification Agreement as a person who has no conflict of interest in
representing the Company or Indemnitee), the latter mandated to make such
entitlement determination in the event of a Proceeding after there has been a
change in control of the Company.
The Indemnitee is not entitled to any indemnification or advancement of
Expenses for indemnification (a) for an accounting of profits made by
Indemnitee from the purchase or sale by the Indemnitee of Company securities,
(b) in connection with any Proceeding brought by the Indemnitee and not by
way of defense, including any Proceeding initiated by the Indemnitee against
the Company or its officers, directors, employees or other indemnitees unless
authorized by the board of directors, or brought to enforce a right to
indemnification, contribution or advancement of Expenses, or (c) if a final
judgment establishes indemnitee's actions or omissions to act were material
to the Proceeding so adjudicated and constitute (i) a violation of criminal
law, except where the Indemnitee had reasonable cause to believe his conduct
was lawful, or Indemnitee had no reasonable cause to believe his conduct was
unlawful; (ii) a transaction from which the Indemnitee derived an improper
personal benefit; (iii) a violation of a section of the Florida statute
prohibiting unlawful distributions; and (iv) willful misconduct or a
conscious disregard for the best interests of the Company in a Proceeding by
or in the right of the Company to obtain a judgment in its favor or on behalf
of a shareholder.
If indemnification is unavailable for any reason (other than as
discussed in the immediately preceding paragraph), the Indemnification
Agreement provides that the Company will contribute to the
amount incurred by the Indemnitee in connection with any claim relating to
indemnification in such proportion that is deemed fair and reasonable by the
board of directors in light of all the circumstances to reflect (i) the
relative benefits received by the Company and the Indemnitee as a result of
the events giving rise to such Proceeding; and/or (ii) the relative fault of
the Company and the Indemnitee in connection with such events.
The Indemnification Agreement continues during the period the Indemnitee
is an officer, director, employee or agent of the Company (or was or is
serving in such capacity with another Enterprise at the request of the
Company), and continues so long as the Indemnitee shall be subject to any
Proceeding by reason of his Corporate Status, whether or not he is serving in
any capacity at the time any liability or Expense is incurred for which
indemnification can be provided under the Indemnification Agreement.
The foregoing description of the Indemnification Agreement is qualified
in its entirety by reference to the form of Indemnification Agreement
attached hereto as exhibit 10.5.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
10.1 Employment Agreement, effective January 1, 2009, between Dialysis
Corporation of America and Thomas P. Carey.
10.2 Employment Agreement, effective January 1, 2009, between Dialysis
Corporation of America and Andrew Jeanneret.
10.3 Employment Agreement, effective January 1, 2009, between Dialysis
Corporation of America and Daniel R. Ouzts.
10.4 Employment Agreement, effective January 1, 2009, between Dialysis
Corporation of America and Joanne Zimmerman.
10.5 Form of Indemnification Agreement for officers and directors of
Dialysis Corporation of America.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
DIALYSIS CORPORATION OF AMERICA
/s/ Stephen W. Everett
By:---------------------------------------
STEPHEN W. EVERETT
President and Chief Executive Officer
Dated: March 2, 2009
EXHIBIT INDEX
Exhibit No.
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10.1 Employment Agreement, effective January 1, 2009, between Dialysis
Corporation of America and Thomas P. Carey.
10.2 Employment Agreement, effective January 1, 2009, between Dialysis
Corporation of America and Andrew Jeanneret.
10.3 Employment Agreement, effective January 1, 2009, between Dialysis
Corporation of America and Daniel R. Ouzts.
10.4 Employment Agreement, effective January 1, 2009, between Dialysis
Corporation of America and Joanne Zimmerman.
10.5 Form of Indemnification Agreement for officers and directors of
Dialysis Corporation of America.