Exhibit 10.52
EMPLOYMENT AGREEMENT
THIS AGREEMENT by and between
PharMerica Corporation and (hereinafter the “Company”),
and William Monast (the “Executive”) is effective as of
April 20, 2009 (“Start Date”);
WHEREAS, the Board of Directors of
the Company (the “Board”), upon the recommendation of
the Compensation and Succession Planning Committee of the Board
(the “Committee”), has determined that it is in the
best interests of the Company and its shareholders to employ the
Executive, effective as of the Start Date, in the position of
Executive Vice President Operations, and the Executive desires to
serve in that capacity;
NOW, THEREFORE, IT IS HEREBY AGREED
AS FOLLOWS:
1. Employment Period. The Company
shall employ the Executive, either directly or through a
Subsidiary, and the Executive shall serve the Company or any such
Subsidiary, on the terms and conditions set forth in this
Agreement, beginning on the Starting Date and until that employment
ceases as provided below in Section 4 (the “Employment
Period”).
2. Position and Duties.
(a) During the Employment Period,
the Executive shall be employed as the Executive Vice President
Operations in Louisville, Kentucky, subject to such changes in
title as may be proposed by the Board or the Chief Executive
Officer and consented to by the Executive. The Executive shall
report to the Chief Executive Officer of the Company and shall
perform such duties for the Company as are related typically to the
office of Executive Vice President Operations, in the manner
reasonably directed by the Chief Executive Officer of the Company,
in his discretion.
(b) During the Employment Period,
but excluding any periods of vacation and absence due to
intermittent illness to which the Executive is entitled, and any
services on corporate, civic or charitable boards or committees,
lectures, speaking engagements or teaching engagements that are
approved by the Executive’s direct supervisor and that do not
significantly interfere with the performance of the
Executive’s responsibilities to the Company or violating the
provisions of Section 9, the Executive shall devote his full
time and attention during normal business hours to the business and
affairs of the Company and the Executive shall use reasonable
efforts to carry out all duties and responsibilities assigned to
him faithfully and efficiently.
3. Compensation.
(a) Base Salary. During the
Employment Period, the Executive shall receive an annual base
salary of $ 350,000, payable bi-weekly in accordance with the
regular payroll practices of the Company. The Executive’s
base salary shall be reviewed annually by the Committee and/or the
Chief Executive Officer of the Company, in accordance with the
Company’s standard practices for executives generally, and
may be increased, but not decreased, as determined by the
Committee, in its sole discretion, or by any person or persons to
whom the Committee has delegated such authority.
(b) Sign-On Bonus: The Executive
shall receive a Sign-On Bonus of $80,000, payable as of the Start
Date.
(c) Annual Bonus and Incentive
Plans; Other Benefits. During the Employment Period: (i) the
Executive shall be entitled to participate in any short-term and
long-term incentive programs established and/or maintained by the
Company for its senior level executives generally; (ii) the
Executive shall be entitled to participate in all incentive,
savings and retirement plans, practices, policies
and programs of the Company to at least the same
extent as other senior executives of the Company; (iii) the
Executive and/or the Executive’s family, as the case may be,
shall be eligible for participation in, and shall receive all
benefits under, all welfare benefit plans, practices, policies and
programs provided by the Company to at least the same extent as
other senior executives of the Company; and (iv) the Executive
shall be entitled to, and the Company shall provide the Executive
with 4 weeks of paid time off (PTO) during each calendar year
pursuant to the Company’s PTO policy. Executive’s
initial Short Term Incentive Target is 75%. Executive’s
initial Long Term Incentive Target is 160%.
(d) Expenses. During the Employment
Period, the Executive shall be entitled to receive advancement or
prompt reimbursement for all reasonable expenses incurred or
anticipated to be incurred by the Executive in carrying out the
Executive’s duties under this Agreement, provided that the
Executive complies with the generally applicable policies,
practices and procedures of the Company for submission of expense
reports, receipts, or similar documentation of such
expenses.
(e) Relocation Expenses. Executive
may receive up to $150,000 in relocation expenses pursuant to the
Company relocation policy. Relocation expenses must be incurred
within six (6) months of the Start Date. If Executive
voluntarily terminates employment with the Company within one year
of Executive’s relocation, then the Executive will reimburse
the Company for 100% of the relocation expenses the Executive
received from the Company. The company will provide the Executive
with temporary housing for 90 days.
4. Termination of
Employment.
(a) Death or Disability. The
Executive’s employment and the Employment Period shall
terminate automatically upon the Executive’s death or long
term Disability during the Employment Period.
“Disability” means a condition entitling the Executive
to benefits under the Company’s Long Term Disability Plan,
policy or arrangement.
(b) By the Company. The Company may
terminate the Executive’s employment under this Agreement
during the Employment Period for Cause or without Cause.
“Cause” means:
(i) the continued failure by the
Executive to substantially perform his duties as contemplated by
this Agreement (other than any such failure resulting from his
incapacity due to physical or mental illness or injury or any such
actual or anticipated failure after the issuance by the Executive
of a Notice of Termination for Good Reason) over a period of not
less than thirty days after a demand for substantial performance is
delivered to the Executive by the Board or by the Chief Executive
Officer of the Company, which demand identifies the manner in which
it is believed that the Executive has not substantially performed
his duties;
(ii) the willful misconduct of the
Executive materially and demonstrably injurious to the Company
(including, without limitation, any breach by the Executive of
Section 9 of this Agreement); provided that no act or failure
to act on the Executive’s part will be considered willful if
done, or omitted to be done, by him in good faith and with
reasonable belief that his action or omission was in the best
interest of the Company;
(iii) the commission by or
indictment of the Executive for a misdemeanor, which, as determined
in good faith by the Board, constitutes a crime of moral turpitude
and gives rise to material harm to the Company or to any subsidiary
or affiliate of the Company;
(iv) the commission by or indictment
of the Executive for a felony (including, without limitation, any
felony constituting a crime of moral turpitude); or
(v) material breach by the Executive
of the Executive’s obligations under this
Agreement.
(c) By the Executive. The Executive
may terminate employment under this Agreement for Good Reason or
without Good Reason. “Good Reason” means:
(i) any reduction in the
Executive’s Base Salary, incentive bonus opportunity or
long-term incentive opportunity; or
(ii) material failure by the Company
to comply with any provision of Sections 2 and 3 of this Agreement,
other than an isolated, insubstantial or inadvertent failure that
is not taken in bad faith and is remedied by the Company within 30
days after receipt of written notice thereof from the
Executive.
Notwithstanding the foregoing,
“Good Reason” for purposes of Section 4(c)(i)
shall not include a reduction in Base Salary, incentive bonus or
long-term incentive opportunity if such reduction is coincident
with a reduction applicable to all members of the senior management
team. A termination of employment by the Executive for Good Reason
shall be effectuated by giving the Company written notice
(“Notice of Termination for Good Reason”) of the
termination, setting forth in reasonable detail the specific
conduct that constitutes Good Reason and the specific provision(s)
of this Agreement on which the Executive relies. Such Notice of
Termination for Good Reason must be received by the Company no
later than the 60 th day after the event, or last in a series of
events, that gives rise to Good Reason. The Company shall have 20
days to remedy the conduct set forth in the Notice of Termination
for Good Reason. A termination of employment by the Executive for
Good Reason shall be effective on the 60 th business day following the date when the Notice
of Termination for Good Reason is given, unless the conduct set
forth in the notice is remedied by the Company within the 20-day
period. A termination of the Executive’s employment by the
Executive without Good Reason shall be effected by giving the
Company at least 30 days’ advance written notice of the
termination.
(d) Date of Termination. The
“Date of Termination” means the date of the
Executive’s death, the date of the Executive’s
Disability, the date the termination of the Executive’s
employment under this Agreement by the Company for Cause or without
Cause or by the Executive for Good Reason or without Good Reason,
as the case may be, is effective. The Employment Period shall end
on the Date of Termination.
5. Obligations of the Company upon
Termination.
(a) By the Company Other Than for
Cause; or By the Executive for Good Reason. If, during the
Employment Period, the Company terminates the Executive’s
employment under this Agreement (other than for Cause) or the
Executive terminates employment under this Agreement for Good
Reason:
(1) the Executive shall be entitled
to (i) continued payment for eighteen (18) months after
the Date of Termination of the Executive’s current base
salary (as in effect on the Date of Termination), and (ii) a
bonus equal to the average of the annual bonuses earned by the
Executive over the three complete years (or if less than three
years, the average bonus earned during such shorter period)
preceding the Date of Termination (that is, not including the bonus
year that includes the Date of Termination) to be paid on the first
business day at the conclusion of the eighteen month period after
the Date of Termination,; and
(2) for the eighteen (18) month
period following the Date of Termination, the Executive will
receive waiver of the applicable premium otherwise payable for
COBRA continuation coverage for the Executive, his spouse and
eligible dependents
(to the extent covered on the Date
of Termination) for health, prescription, dental and vision
benefits; provided, however, that to the extent COBRA continuation
coverage eligibility expires (unless such expiration is due to
eligibility for other group health insurance or Medicare) before
the end of such eighteen month period, the Executive will receive
payment, on an after-tax basis, of an amount equal to the premium
the Company would have otherwise waived for COBRA coverage. The
obligations of the Company to provide benefits under this
Section 5(a)(2) shall terminate on the date of occurrence of
the first to occur of any of the following, if any of the following
should occur prior to the end of the eighteen (18) month
period: (i) the date of commencement of eligibility of the
Executive under the group health plan of any other employer or
(ii) the date of commencement of eligibility of the Executive
for Medicare benefits.
In addition, the Executive shall be
entitled to receive executive level outplacement assistance under
any outplacement assistance program then being maintained by the
Company in accordance with the terms of any such program. The
Executive shall also become vested in any outstanding options,
restricted stock or other equity incentive awards only to the
extent provided for under the terms governing such equity incentive
award. The Company shall also pay, or cause to be paid, to the
Executive, in a lump sum in cash within 30 days after the Date of
Termination (or, in the case of the pro-rated Annual Bonus Amount,
at the time such bonus would otherwise be paid), the
Executive’s accrued but unpaid cash compensation (the
“Accrued Obligations”), which shall include but not be
limited to, (W) the Executive’s base salary through the
Date of Termination that has not yet been paid (X) an amount
representing a 100% target bonus for the Executive’s salary
grade for the year of termination, multiplied by a fraction, the
numerator of which is the number of days in the current fiscal year
through the Date of Termination, and the denominator of which is
365 (the “Annual Bonus Amount”), (Y) any accrued
but unpaid vacation or PTO pay, and (Z) similar unpaid items
that have accrued and as to which the Executive has become entitled
as of the Date of Termination, including declared but unpaid
bonuses and unreimbursed employee business expenses; provided,
however, that the Company’s obligation to make any payments,
or cause any payments to be made, under this paragraph (a) to
the extent any such payment shall not have accrued as of the day
before the Date of Termination shall also be conditioned upon the
Executive’s execution, and non-revocation, of a written
release, substantially in the form attached hereto as Exhibit 1, of
any and all claims against the Company and all related parties with
respect to all matters arising out of the Executive’s
employment under this Agreement or the termination thereof (other
than any entitlements under the terms of this Agreement to
indemnification or under any other plans or programs of the Company
in which the Executive participated and under which the Executive
has accrued and is due a benefit).
If any payment, compensation or
other benefit provided to the Executive in connection with his
employment termination is determined, in whole or in part, to
constitute “nonqualified deferred compensation” within
the meaning of Section 409A of the Code and the Executive is a
specified employee as defined in Section 409A(a)(2)(B)(i) and
Income Tax Regulations under Section 409A, no part of such
payments shall be paid before the day that is six (6) months
plus one (1) day after the Date of Termination (the “New
Payment Date”). The aggregate of any payments that otherwise
would have been paid to the Executive during the period between the
termination date and the New Payment Date shall be paid to the
Executive, without interest, in a lump sum on such New Payment
Date. Thereafter, any payments that remain outstanding as of the
day immediately following the New Payment Date shall be paid
without delay over the time period originally scheduled, in
accordance with the terms of this Agreement.
(b) Death or Disability. If the
Executive’s employment is terminated by reason of the
Executive’s death or Disability during the Employment Period,
the Company shall pay the Accrued Obligations to the Executive or
the Executive’s estate or legal representative, as
applicable, in a lump sum in cash within 30 days after the Date of
Termination. If the Executive’s employment is
terminated by reason of the Executive’s
death, the Executive shall also become vested in any outstanding
options, restricted stock or other equity incentive awards. If the
Executive’s employment is terminated by reason of the
Executive’s death or Disability, the Company shall have no
further obligations under this Agreement or otherwise to or with
respect to the Executive other than for any entitlements under the
terms of any other plans or programs of the Company in which the
Executive participated and under which the Executive has become
entitled to a benefit.
(c) By the Company for Cause; By the
Executive Other than for Good Reason. If the Executive’s
employment is terminated by the Company for Cause during the
Employment Period, or the Executive voluntarily terminates
employment during the Employment Period, other than for Good
Reason, the Company shall pay the Executive, or shall cause the
Executive to be paid, the Executive’s base salary through the
Date of Termination that has not been paid and the amount of any
declared but unpaid bonuses, accrued but unpaid vacation or PTO
pay, and unreimbursed employee business expenses, and the Company
shall have no further obligations under this Agreement or otherwise
to or with respect to the Executive other than for any entitlements
under the terms of any other plans or programs of the Company in
which the Executive participated and under which the Executive has
become entitled to a benefit.
Termination Pursuant to a Change of
Control. If there is a Change of Control, as defined in
Section 5(d)(i) below, during the Term, the provisions of this
Section 5(d) shall apply and shall continue to apply
throughout the remainder of Employment Period. If, within one
(1) year following a Change of Control, the Executive’s
employment is terminated by the Company or the Executive following
the occurrence of any of the events listed in Section 5(d)(ii)
below or if the Executive’s employment is terminated without
cause (in accordance with Section 5(a) above), the Company
shall pay to the Executive (or the Executive’s estate, if
applicable) the payments described under Section 5(a) and the
Executive shall become vested in any outstanding options,
restricted stock, or other equity incentive award; provided that
the Company’s obligation to make any payment, or to permit
any vesting of outstanding options, restricted stock, or other
equity incentive award as described above, shall be conditioned
upon the Executive’s execution, and non-revocation, of a
written release, substantially in the form attached hereto as
Exhibit 1.
(i) Change of Control shall mean the
occurrence of one or more of the following events:
(A) any “person” (as
such term is used in Sections 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”))
becomes a “beneficial owner” (as such term is defined
in Rule 13d-3 promulgated under the Exchange Act) (other than the
Company, any trustee or other fiduciary holding securities under an
employee benefit plan of the Company, or any corporation owned,
directly or indirectly, by the stockholders of the Company, in
substantially the same proportions as their ownership of stock of
the Company), directly or indirectly, of securities of the Company,
representing forty percent (40%) or more of the combined
voting power of the Company’s then outstanding securities;
or
(B) persons who, as of the Effective
Date, constituted the Company’s Board of Directors (the
“Incumbent Board”) cease for any reason including,
without limitation, as a result of a tender offer, proxy contest,
merger or similar transaction, to constitute at least a majority of
the Board of Directors, provided that any person becoming a
director of the Company subsequent to the Effective Date whose
election was approved by at least a majority of the directors then
comprising the Incumbent Board shall, for purposes of this
Section 5(d), be considered a member of the Incumbent Board;
or
(C) the stockholders of the Company
approve a merger or consolidation of the Company with any other
corporation or other entity, other than (1) a merger or
consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) more than forty
percent (40%) of the combined voting power of the voting
securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (2) a merger
or consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no “person”
(as hereinabove defined) acquires more than forty percent
(40%) of the combined voting power of the Company’s then
outstanding securities; or
(D) the stockholders of the Company
approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or
substantially all of the Company’s assets.
(ii) The events referred to in
Section 5(d) above shall be as follows:
(A) a reduction of the
Executive’s salary other than a reduction that (1) is
based on the Company’s financial performance or (2) is
similar to the reduction made to the salaries provided to all or
most other senior executives of the Company; or
(B) a significant change in the
Executive’s responsibilities and/or duties which constitutes,
when compared to the Executive’s responsibilities and/or
duties before the Change of Control, a demotion; or
(C) a material loss of title or
office; or
(D) the relocation of the offices at
which the Executive is principally employed as of the Change of
Control to a location more than fifty (50) miles from such
offices, which relocation is not approved by the
Executive.
The Executive shall provide the
Company with reasonable notice and an opportunity to cure any of
the events listed in Section 5(d)(ii) and shall not be
entitled to compensation pursuant to this Section 5(d) unless
the Company fails to cure within a reasonable period;
and
(iii) It is the intention of the
Executive and of the Company that no payments by the Company to or
for the benefit of the Executive under this Agreem
