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EMPLOYMENT AGREEMENT
AGREEMENT (this "Agreement") is made and entered into as of December 20, 2016, by and between Apollo Medical
Management, Inc., a California corporation (the "Employer"), and Gary Augusta (the "Employee"
and together with the Employer referred to as the "Parties") to become effective as of the date hereof (the
Employer desires to employ the Employee from and after the Effective Date on the terms and conditions set forth below, and the
Employee is willing to serve the Employer on such terms and conditions.
in consideration of the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Parties agree as follows:
The term of this Agreement shall initially be for a three (3) year period commencing on the Effective Date. The term of this Agreement
shall automatically renew for an additional year on each anniversary of the Effective Date unless either Party gives the other
written notice of intent not to renew at least sixty (60) days prior to such date. Notwithstanding the foregoing, the initial term
and any renewal year shall be subject to earlier termination as provided in Section 4 below. The initial term and any renewal
years are referred to herein as the "Term".
and Duties. During the Term, the Employee shall serve as a senior executive officer of the Employer. The Employee shall perform
for the Employer the duties customarily associated with being a senior executive officer that are consistent with your experience
and skills and such other duties as may be assigned to the Employee from time to time by the Employer's Board of Directors
(the "Board") that are consistent with the duties normally performed by those performing the role of the most
senior executives of similar entities. The Employee shall devote such working time, attention, knowledge, skills and efforts as
may be required to fulfill the Employee's duties hereunder, as reasonably determined by the Board. The Employee shall be
permitted to perform services as required, and provided, further that the Employee may participate as a member of
the board of directors or advisory board of other entities and in professional organizations and civic and charitable organizations
so long as any such positions are disclosed to the Board and do not materially interfere with the Employee's duties and responsibilities
to the Employer. The Employee shall be based in Tampa, Florida.
and Related Matters. The Employer shall provide the Employee with the compensation and benefits set forth in this Section
3 during the Term. Authority to take action under this Section 3 with respect to the Employee's compensation and
benefits may be delegated by the Board to its compensation committee.
Salary. The Employer shall pay the Employee for all services rendered a base salary of Three Hundred Thousand Dollars ($300,000)
per year (the "Base Salary"), payable in accordance with the Employer's payroll procedures, subject to
customary withholdings and employment taxes. The Base Salary shall be evaluated annually by the Board for increase only.
Bonus. The Employee will be eligible to receive an annual cash bonus (the "Annual Bonus") for each fiscal
year during the Term on such terms and conditions as the Board shall determine in its discretion consistent with the terms of
the Employer's business plan.
Term Incentive Awards. The Employee shall be eligible to participate in any long term incentive plan that may be available
to similarly positioned executives. The Board may determine to grant long-term incentive awards in cash or in equity awards settled
in shares of the Employer's stock, including but not limited to stock options, restricted stock and performance shares. In
the event the Employee terminates service due to being a Good Leaver, any requirements under a long-term incentive award held by
the Employee shall be deemed to have been satisfied by the Employer immediately prior to such termination. A "Good Leaver"
means that, during the Term, either the Employee has resigned for Good Reason (as defined in Section 4(e) below), the Employer
has terminated the Employee's employment without Cause (as defined in Section 4(d) below or the Employee terminates
employment on account of death or Disability (as defined in Section 4(b) below). For avoidance of doubt, being a Good Leaver
entitles the Employee to be fully vested with respect to any stock options with vesting conditions based solely on continued employment,
and to be entitled to payment with respect to any long-term incentive award subject to corporate or business goals to the extent
that such goals are met during the performance period on the same basis as if he had remained continuously employed with the Employer.
Time Off. During the term, the Employee shall be entitled to twenty (20) business days of paid time off ("PTO")
per calendar year which shall be accrued ratably during the calendar year, to be taken at such times and intervals as shall be
agreed to by Employer and the Employee in their reasonable discretion. The Employee shall be entitled to accrue a maximum of twenty
(20) business days of paid time off. When the maximum accrual is reached, no additional PTO time will accrue until Employee uses
one or more accrued PTO days. Accrued and unused PTO shall be paid in cash at the end of a calendar year.
The Employee shall be entitled to prompt reimbursement of reasonable and usual business expenses incurred on behalf of Employer
in accordance with the Employer's expense reimbursement policy.
Benefits. The Employee shall be entitled to continue to participate in or receive benefits under any employee benefit plan
or arrangement which is or may, in the future, be made available by the Employer to its employees, subject to and on a basis consistent
with the terms, conditions and overall administration of such plan or arrangement. Irrespective of other benefits provided to
employees, the Employee's benefits package shall include: (i) the Employer's payment of premiums for medical, dental
and vision care coverage, (ii) the Employer's payment of insurance premiums for short-term and long-term disability insurance
providing for no less than sixty percent (60%) of Employee's Base Salary to be payable to the Employee as long as the covered
disability persists in a manner that substantially prevents employment in the same occupation as the position Employee last held
with Employer but not beyond age sixty-five (65);' and Employer's payment of insurance premiums for term life insurance
providing for no less than two million dollars of coverage (subject to meeting applicable underwriting requirements).
Withholding. The Employer shall undertake to make deductions, withholdings and tax reports with respect to payments and benefits
under this Agreement, to the extent it reasonably and in good faith believes it is required to make such deductions, withholdings
and tax reports. Payments with respect to compensation and benefits referred to under this Agreement shall be in amounts net of
any such deductions or withholdings. Nothing in this Agreement shall be construed to require the Employer to make any payments
to compensate the Employee for any adverse tax effect associated with any payments or benefits, or for any deduction or withholding
from any payment or benefit.
The Employee's employment hereunder may be terminated during the Term without any breach of this Agreement under the following
The Employee's employment hereunder shall terminate upon the Employee's death.
The Employer may terminate the Employee's employment if the Employee is disabled and, because of the disability, is unable
to perform the essential functions of the Employee's then existing position or positions under this Agreement with or without
reasonable accommodation. This provision is not intended to reduce any rights the Employee may have pursuant to any law, including
without limitation the California Family Rights Act, the Family and Medical Leave Act, the California Fair Employment and Housing
Act, and the Americans with Disabilities Act.
by the Employer for Cause. At any time during the Term, the Employer may terminate the Employee's employment hereunder
for Cause. For purposes of this Agreement, "Cause" shall mean: (i) conduct by the Employee constituting a material
act of willful misconduct in connection with the performance of the Employee's duties that results in loss, damage or injury
that is material to the Employer; (ii) the commission by the Employee of any felony; (iii) continued, willful and deliberate non-performance
by the Employee of the Employee's duties hereunder (other than by reason of the Employee's physical or mental illness,
incapacity or disability); (iv) a material breach by the Employee of Section 6 of this Agreement that results in loss, damage
or injury that is material to the Employer; (v) willful failure to cooperate with a bona fide internal investigation or an investigation
by regulatory or law enforcement authorities, after being instructed by the Employer to cooperate, or the willful destruction or
failure to preserve documents or other materials known to be relevant to such investigation or the willful inducement of others
to fail to cooperate or to produce documents or other materials in connection with such investigations; or (vi) fraud, embezzlement
or theft against the Employer or any of its Affiliates (as defined in Section 6(a) below). With respect to the events in
(i), (iii) and (iv) herein, the Employer shall have delivered written notice to the Employee of its intention to terminate the
Employee's employment for Cause, which notice specifies in reasonable detail the circumstances claimed to give rise to the
Employer's right to terminate the Employee's employment for Cause and the Employee shall not have cured such circumstances
to the extent such circumstances are reasonably susceptible to cure as determined by the Board in good faith within thirty (30)
days following the Employer's delivery of such notice. For avoidance of doubt, "Cause" shall not include (w)
below par or below average operational performance, in and of itself; (x) expense reimbursement disputes in which the Employee
acts in reasonable good faith; (y) occasional, customary and de minimis use of the Employer's property for personal purposes;
and (z) acting in good faith upon advice of Employer's legal counsel.
without Cause. At any time during the Term, the Employer may terminate the Employee's employment hereunder without
Cause by providing the Employee with thirty (30) days advance written notice. Any termination by the Employer of the
Employee's employment under this Agreement that does not constitute a termination for Cause under Section 4(c)
and does not result from the death or Disability of the Employee under Sections 4(a) or 4(b) shall be deemed a
termination without Cause under this Section 4(d). Any suspension of the Employee's employment with pay or
benefits by the Board in good faith pending an investigation of alleged improper activities by the Employee that, if
determined to be accurate, would be grounds for a Cause termination, shall not be considered a termination of the
Employee's employment without Cause or provide with Good Reason to terminate employment.
by the Employee. At any time during the Term, the Employee may terminate his employment hereunder for any reason, including,