EXHIBIT 10.13
SEPARATION AGREEMENT AND RELEASE
This
Separation Agreement and Release ("Agreement") is made this 2nd day
of
April, 2006, between Neil M. Hughes ("Employee") and (ii) Air
Methods
Corporation ("the Company"). Employee and Company are referred
to collectively
as the "Parties."
RECITALS
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A.
The Employee has
been employed by the Company pursuant to the terms
of an Employment Agreement dated January 1, 2003, as amended as of
January 3,
2006, (the "Employment Agreement").
B.
The Employee has
given notice to the Company of his resignation as
an employee of the Company. The Parties wish to end the
employment relationship
between them and resolve fully and finally all of their rights
and
responsibilities with respect to each other on the terms set forth
in this
Separation Agreement.
C.
In order to
accomplish an amicable termination of the employment
relationship between them, the Parties are willing to enter into
this Agreement.
The
Parties therefore agree as follows:
1.
Resignation and
Effective Dates. As of April 2, 2006, the Employee
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shall resign his employment with the Company (the "Resignation
Date"). This
Agreement shall become effective (the "Effective Date") on the
eighth day after
Employee's execution of this Agreement, provided that the Employee
has not
revoked his acceptance pursuant to subparagraph 13i.
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2.
Accrued
Compensation. On the Resignation Date the Company shall pay
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Employee all wages, benefits, and reimbursements due under
applicable state and
federal law. Wages
shall be computed in accordance with the Company's standard
procedures. All
expense reports filed by Employee for reimbursement must be
filed by April 12, 2006. Reimbursement for such expenses
not made shall be made
by Company as soon as practical.
3.
Separation
Payment.
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a. In addition
to the payment of wages and benefits and
reimbursement of expenses referred to in paragraph 2 of this
Agreement, the
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Company shall pay Employee twelve (12) months of separation pay,
less applicable
deductions, at the annual rate equal to the Executive's highest
cash
compensation received during any 12-month period of his employment
which is
$320,100. Such separation pay shall be paid at such regular
intervals as the
Company pays compensation to the executives. If the Employee is
participating
within the 401(k) Plan, only the first two and one half months of
severance will
be subject to the employee's 401(k) elected contribution and
company's
contribution.
b. Reporting of
and withholding on these payments for tax purposes
shall be at the discretion of the Company in conformance with
applicable tax
laws. If, for any
reason, at any time, a claim is made against the Company for
any additional tax or withholding in
<PAGE>
connection with or arising out of the payment pursuant to
subparagraph a above,
Employee shall pay any such claim within thirty (30) days of being
notified by
the Company and agrees to indemnify the Company and hold it
harmless against
such claims, including but not limited to any taxes, attorneys'
fees, penalties
and/or interest, which are or become due from the Company.
4. Insurance Coverage. Provided
that Employee timely elects continuation
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coverage under the Consolidated Omnibus Budget Reconciliation Act
of 1985, as
amended ("COBRA"), the Company shall pay, on Employee's behalf, the
entire
health and dental insurance premiums for the period through March
31, 2007. The
premium paid by the Company shall provide for coverage for only
those eligible
dependents of Employee, if any, who were enrolled in the Company's
health and
dental insurance plans as of the Resignation Date. For the balance
of the period
that Employee is entitled to coverage under COBRA, Employee shall
be entitled to
maintain coverage for Employee and Employee's dependents at
Employee's sole
expense. The Company's obligation to pay the Employee's insurance
premiums shall
cease upon the date the Employee begins other employment in
connection with
which he is entitled to health insurance coverage.
5.
Stock Options.
The Company has previously granted to the Employee
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options to purchase shares of the Company's common stock.
The Company and
the
Employee agree that, as of the Effective Date, options, exercisable
at the
following prices and in the following number of shares, are
exercisable by the
Employee:
<TABLE>
<CAPTION>
Date of Grant Number
of Vested Options
Exercise Price
-------------
------------------------ --------------
<S>
<C>
<C>
6/27/02
25,000
$
8.889
01/01/04
15,000
$
8.98
01/03/02
20,000
$
6.15
</TABLE>
Such options may be exercised at any time up to and including
ninety (90) days
after the Effective Date in the manner provided in the Company's
1995 Stock
Option Plan and the Stock Option Agreements between the Employee
and the Company
reflecting such option grants.
Employee acknowledges responsibility to continue to be subject to
the Company's
Insider Trading Policy during his employment with the Company.
6.
Outplacement.
The Company will pay for outplacement counseling with a
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counselor not to exceed $5,000 should the Employee request
outplacement. Contact
the Company's Vice President of Human Resources for further
information.
7.
Mutual General
Release.
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a. Employee and
his assigns, heirs, and successors hereby
voluntarily and knowingly release and discharge the Company and its
successors,
subrogees, assigns, principals, agents, partners, employees,
shareholders,
members, officers, directors, board members, subsidiaries,
affiliates and
associates from any and all claims, actions, causes of action,
liabilities,
demands, rights, damages, costs, attorney's fees, expenses and
controversies of
every kind and description from the beginning of time through the
Effective
Date. The Company
-2-
<PAGE>
hereby voluntarily and knowingly releases and discharges Employee
and his
assigns, heirs and successors from any and all claims, actions,
causes of
action, liabilities, demands, rights, damages, costs, attorney's
fees, expenses
and controversies of every kind and description from the beginning
of time
through the Effective Date.
b. This release
shall include, by way of example and not limitation,
all claims, actions, causes of action, liabilities, demands,
rights, damages,
costs, attorneys' fees, expenses and controversies of every kind
which arise out
of, relate to, or ar
