Exhibit 10.2

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into effective
November 4th, 2016, by and between Bay Area Hospitalist Associates, Inc., a
California professional corporation (the “Employer” or “BAHA”), and Scott
Enderby, M.D. (the “Employee”). Together, the Employer and Employee are
individually sometimes referred to herein as a “Party” and collectively as the
“Parties”. The Employer, together with any one or more of its Affiliates (as
defined in Section 6), is sometimes referred to collectively herein as the
“Company”.

 

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:

 

1.           Employment. The term of this Agreement shall commence on November
4, 2016 (the “Commencement Date”) and continue thereafter for a period of two
years. The term of this Agreement shall automatically extended for subsequent
one year terms renewing on each respective anniversary of the Commencement Date
(the date of each such renewal shall be the “Renewal Date”), unless, not less
than 60 days prior to each such Renewal Date, either Party shall have given
written notice to the other that the Agreement will not be renewed. Each term of
this Agreement, beginning with the Commencement Date or any subsequent Renewal
Date, shall be subject to termination as provided in Section 4 and may be
referred to herein as the “Term.”

 

2.           Position and Duties. During the Term, the Employee shall serve as
the Chief Executive Officer of BAHA, with the duties and responsibilities
commensurate with such office and required by the Company. The Employee will
also undertake such corporate administration duties, including human resources
for the Company, as may be reasonably requested of him. The Employee shall
devote all of his working time and efforts as may be necessary to the business
and affairs of the Company and shall not engage in any other employment or
consultancy, full-time or part-time, for any other person during the Term, as
well as complying fully with the provisions of Section 6(h) of this Agreement.
The Employee understands, acknowledges and agrees that the nature of his duties
may require him to travel on Company business, and such travel may include
overnight and multiple-day travel. The Employee shall report to Apollo Medical
Holdings, Inc’s Chief Executive Officer and, upon request, the Apollo Medical
Holdings, Inc’s Board of Directors or any committee thereof, including without
limitation its Audit Committee. Additionally, in the exercise of his duties and
responsibilities pursuant to this Agreement, the Employee shall at all times
follow all guidelines and policies of the Company, including without limitation
all of its corporate governance guidelines, codes of ethics, codes of business
conduct, related party transaction policy and insider trading policy, as from
time to time in effect (collectively, “Corporate Governance Policies”). The
violation of any Corporate Governance Policies by the Employee shall be
considered a basis for termination for Cause (as defined in Section 4(c) of this
Agreement).

 

3.           Compensation and Related Matters.

 

(a)          Base Salary. The Employer shall pay the Employee for all services
rendered a base salary of $400,000 per year, (the “Base Salary”), payable in
accordance with the Employer’s payroll procedures, subject to customary
withholdings and employment taxes. The Base Salary may be re-evaluated annually
at the sole discretion of the Employer and may be increased at the sole
discretion of the Employer.

 

(b)          Incentive Compensation. The Employee shall be entitled to
participate in any Company incentive compensation plans as are now available or
may become available to other similarly positioned employees of the Employer
and/or receive a cash bonus that may be decided by the Compensation Committee of
the Company’s Board of Directors (or, in the absence of a Compensation
Committee, the Board of Directors itself), in its sole and absolute discretion.
The Employee’s entitlement to a bonus under any such plan shall governed by the
terms of any such plan and/or the terms of any determination made as provided in
the previous sentence and no right to any such compensation is created by this
Agreement.

 

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(c)          Equity Awards. The Employee shall be eligible to participate in any
Company equity incentive plan available to similarly positioned executives (an
“Incentive Plan”). From time to time, the Compensation Committee of the
Company’s Board of Directors (or, in the absence of a Compensation Committee,
the Board of Directors itself) may, in its sole and absolute discretion, grant
stock options or award other equity compensation to the Employee pursuant to the
Stock Plan. The Employee’s entitlement to any grant or award under any such plan
shall governed by the terms of any Incentive Plan and no right to any such grant
or award is created by this Agreement.

 

(d)          Paid Time Off. During the term, the Employee shall be entitled to
twenty (20) 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 mutually agreed to by the Employer and the Employee in
their reasonable discretion. The Employee shall be entitled to accrue a maximum
of twenty (20) days of PTO at any time. If the maximum PTO accrual is reached,
no more PTO will accrue until Employee uses one or more accrued PTO days.

 

(e)          Expenses. The Employee shall be entitled to reimbursement of
expenses incurred on behalf of the Employer, including travel and related per
diem expenses, consistent with the Employer’s policies and, in all cases,
subject to proper documentation maintained and submitted by the Employee. The
Employer agrees to maintain an insurance policy providing reasonable and
customary insurance coverage for errors and omissions of its directors and
officers made in the course and scope of employment with Employer, in such
amounts and on such terms as are generally available to the Company’s other
directors and executive officers, at no cost to Employee.

 

(f)           Other Benefits. During the Term, 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 generally, subject to and on a basis consistent with the terms,
conditions and overall administration of such plan or arrangement.

 

(g)          Tax 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 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.

 

4.           Termination. The Employee’s employment hereunder may be terminated
under the following circumstances:

 

(a)          Death. The Employee’s employment hereunder shall terminate upon the
Employee’s death.

 

(b)          Disability. 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 for a period of at
least three consecutive (3) months in any twelve-month period. 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.

 

(c)          Termination 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 gross negligence, recklessness or willful
misconduct in connection with the performance of the Employee’s duties,
including, without limitation, misappropriation of funds or property of the
Company other than the occasional, customary and de minimis use of the
Employer’s property for personal purposes; (ii) the commission by the Employee
of any felony or a misdemeanor involving moral turpitude, deceit, dishonesty or
fraud, or any conduct by the Employee that would reasonably be expected to
result in material injury to the Company or its reputation if the Employee were
retained in the Employee’s position; (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 this Agreement; (v) a
violation by the Employee of the Employer’s employment policies; (vi) material
failure to perform the duties of his position as set forth in Section 2 of this
Agreement; or (vii) willful failure to cooperate with a bona fide internal
inquiry or investigation, including without limitation any inquiry or
investigation by the Company’s legal counsel, the Company’s Audit Committee or
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 any such inquiry or
investigation or the willful inducement of others to fail to cooperate or to
produce documents or other materials in connection with any such inquiry or
investigation; provided that, with respect to any termination for Cause pursuant
to clauses 4(c)(i), (iii), (iv), (v), (vi), and (vii) above, the Company shall,
prior to any termination of employment for Cause, first (a) provide Employee
with written notice that sets forth, with reasonable specificity, the alleged
grounds for “Cause” and (b) provide Employee with sixty (60) days opportunity to
cure the alleged grounds for termination, to the fullest extent practicable.

 

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(d)          Termination Without Cause. At any time during the Term, the
Employer may terminate the Employee’s employment hereunder without Cause. Any
termination by the Employer of the Employee’s employment under this Agreement
which 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
(b) shall be deemed a termination without Cause.

 

(e)          Termination by the Employee. At any time during the Term, the
Employee may terminate his employment hereunder for any reason, including but
not limited to Good Reason. For purposes of this Agreement, “Good Reason” shall
mean that the Employee has complied with the “Good Reason Process” (hereinafter
defined) following the occurrence of any of the following events: (i) a material
diminution in the Employee’s responsibilities, authority, title, or duties, (ii)
a material diminution in the Employee’s Base Salary below the amount as of the
Commencement Date or as increased during the course of Employee’s employment
with the Company; (iii) the relocation of Employee’s principal place of
employment in San Francisco, California to a location which is more than fifty
(50) miles away; or (iv) the material breach of this Agreement by the Employer.
“Good Reason Process” shall mean (i) the Employee reasonably determines in good
faith that a “Good Reason” condition has occurred; (ii) the Employee notifies
the Employer in writing of the occurrence of the Good Reason condition within 60
days following the occurrence of such condition; (iii) the Employee cooperates
in good faith with the Employer’s efforts, for a period of 60 days following
such notice (the “Cure Period”), to remedy the condition; (iv) notwithstanding
such efforts, the Good Reason condition continues to exist; and (v) the Employee
terminates his employment within 60 days following the end of the Cure Period.
If the Employer cures the Good Reason condition during the Cure Period, Good
Reason shall be deemed not to have occurred, the Employee may not terminate his
employment for Good Reason and any termination by the Employee under such
circumstances shall be deemed to be a termination by the Employee without Good
Reason.

 

(f)           Notice of Termination. Except for termination as specified in
Section 4(a), any termination of the Employee’s employment shall be communicated
by written Notice of Termination by the Party initiating the termination to the
other Party. For purposes of this Agreement, a “Notice of Termination” shall
mean a notice which shall indicate the specific termination provision in this
Agreement upon which reliance is made by the terminating Party.

 

(g)          Date of Termination. “Date of Termination” shall mean the earliest
to occur of the following: (i) if the Employee’s employment is terminated by the
Employee’s death, the date of the Employee’s death; (ii) if the Employee’s
employment is terminated by the Employee under Section 4(e) with Good Reason,
the date on which Notice of Termination is given after the end of the Cure
Period; (iii) if the Employee’s employment is terminated by the Employee under
Section 4(e) without Good Reason, 30 days after the date of which a Notice of
Termination is given; (iv) the first anniversary date of the Commencement Date
that is not also a Renewal Date (except that November 4, 2017 shall not be a
Date of Termination); or (v) in all other cases, the date on which Notice of
Termination is given by one Party to the other Party. Notwithstanding the
foregoing, in the event that the Employee gives a Notice of Termination to the
Employer, the Employer may unilaterally accelerate the Date of Termination but
such acceleration shall nevertheless be deemed a termination by the Employee on
the accelerated date for purposes of this Agreement.

 

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5.           Compensation Upon Termination.

 

(a)          Termination or Nonrenewal Generally. If the Employee’s employment
with the Employer is terminated for any reason during the Term, or if the Term
is not renewed, the Employer shall pay or provide the Employee (or the
Employee’s authorized representative or estate) any earned but unpaid Base
Salary for services rendered through the Date of Termination, unpaid expense
reimbursements pursuant to Section 3(e), and accrued but unused PTO (“Accrued
Benefits”) within the time prescribed by California law. With respect to vested
benefits the Employee may have under any employee benefit plan of the Employer,
payment, if any, will be made to the Employee under the terms of the applicable
plan.

 

(b)          Termination by the Employer Without Cause or by the Employee With
Good Reason. If the Employee’s employment is terminated by the Employer without
Cause as provided in Section 4(d), or the Employee terminates his employment for
Good Reason as provided in Section 4(e), then the Employer shall, through the
Date of Termination, pay the Employee his Accrued Benefits, and any of the
Employee’s vested benefits under any employee benefit plan of the Employer shall
be paid to the Employee under the terms of the applicable plan. If, but only if,
the Employee signs a general release of claims in a form and manner satisfactory
to the Employer, substantially in the form attached hereto as Exhibit A and
incorporated herein by this reference (a “Release”) within 21 days following the
receipt of the form of Release (extended to 45 days in the event of a group
termination or exit incentive program) and does not revoke such Release during
the seven (7) day revocation period provided for therein:

 

(i)          the Employer shall pay the Employee an amount equal to four weeks
of Employee’s most recent Base Salary for every full year of Employee’s active
employment by Employer, but such amount shall be no less than one month’s worth
nor more than six months’ worth of the Employee’s most recent Base Salary (the
“Severance Amount”). To the extent the that such Severance Amount exceeds the
409A Separation Pay Limit (as defined below), such amount shall be paid in a
single lump sum on the regular payroll date of the Employer, pertaining to then
current salaried employees of the Employer, (“payroll date”) next following the
first anniversary date of the Employee’s Date of Termination or first
permissible date afterward. The portion of the Severance Amount that does not
exceed the 409A Separation Pay Limit shall be paid in substantially equal
amounts on each payroll date in accordance with the Employer’s normal payroll
practices over consecutive periods of three months for each year of Base Salary
that is due as the Severance Amount, beginning on the first payroll date after
the Date of Termination or expiration of the seven-day revocation period of the
Release, if later, provided, however, that all such payments shall be concluded
prior to the last day of the second (2d) taxable year of the Employee following
the taxable year of the Employee in which the Employee has a separation from
service as defined in Section 409A; and

 

(ii)         the Employer shall pay the Employee an amount equal to the
Employer’s premium amounts paid for coverage of Employee at the time of the
Employee’s termination of coverage under the Employer’s group medical, dental
and vision programs for a period of twelve (12) months, to be paid directly to
the Employee at the same times such payments would be paid on behalf of a
current employee for such coverage; provided, however:

 

(A) No payments shall be made under this paragraph (ii) unless the Employee
timely elects continued coverage under such plan(s) pursuant to the Consolidated
Omnibus Budget Reconciliation Act of 1985 as amended (“COBRA”);

 

(B) This paragraph (iii) shall not be read or construed as placing any
restrictions upon amounts paid under this paragraph (ii) as to their use;

 

(C) Payments under this paragraph (iii) shall cease as of the earliest to occur
of the following:

 

(1) the Employee is no longer eligible for and continuing to receive the COBRA
coverage elected in subparagraph (A);

 

(2) the time period set forth in the first sentence of this paragraph (iii),

 

(3) the date on which the Employee first becomes eligible to enroll in a group
health plan in which eligibility is based on employment with an employer, and

 

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(4) if the Employer in good faith determines that payments under this paragraph
(iii) would result in a discriminatory health plan pursuant to the Patient
Protection and Affordable Care Act of 2010, as amended.

 

(iii)        Each individual payment of Severance Amount under Section 5(b)(ii),
and each payment under Section 5(b)(iii), of this Agreement, shall be deemed to
be a separate “payment” for purposes and within the meaning of Treasury
Regulation Section 1.409A-2(b)(2)(iii).

 

(iv)        Each individual payment of the Severance Amount under Section
5(b)(ii), and each payment under Section 5(b)(iii), of this Agreement, which are
considered “non-qualified deferred compensation” (“NQDC”) under Section 409A
shall be made on the date(s) provided herein and no request to accelerate or
defer any such payment under this Agreement shall be considered or approved for
any reason whatsoever, except as permitted under Section 409A and as the
Employer allows in its sole discretion. The Employer may in its sole discretion
accelerate or defer (but not beyond the time limit set forth below) any
severance payments which do not constitute NQDC in order to allow for the
payment of taxes due, but not beyond the time limit specified for such payment
such that the payment would be treated as NQDC. Subject to the requirements of
Section 409A, if any payment of severance payment under Section 5(b)(ii), or
reimbursement under Section 5(b)(iii), of this Agreement, is determined in good
faith by the Employer to constitute NQDC payable to a “specified employee” as
defined under Section 409A, then the Employer shall make any such payment not
earlier than the earlier of: (x) the date which is six (6) months following the
Employee’s separation from service with the Employer, or (y) the date of
Employee’s death.

 

(v)         for purposes of this Section 5, “Section 409A” means Section 409A of
the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations
thereunder.

 

(vi)        for purposes of this Section 5, “409A Separation Pay Limit” means
two times the lesser of (x) the Employee’s Base Salary plus bonus earned from
services provided to the Employer during the calendar year preceding the year of
the termination of employment; and (y) the adjusted compensation limit under
Code section 401(a)(17) in effect for the year of the termination.

 

Notwithstanding the foregoing, if the Employee breaches this Agreement,
including, without limitation, Section 2 and/or Section 6 of this Agreement, all
payments of the Severance Amount and the Employer’s payment for medical, dental,
and vision insurance continuation shall immediately cease.

 

6.           Confidential Information, Nonsolicitation and Cooperation.

 

(a)          Definitions.

 

(i)          As used in this Agreement, “Affiliate” means, as to any Person, (i)
any other Person which directly, or indirectly through one or more
intermediaries, controls such Person or is consolidated with such Person in
accordance with GAAP, (ii) any other Person which directly, or indirectly
through one or more intermediaries, is controlled by or is under common control
with such Person, or (iii) any other Person of which such Person owns, directly
or indirectly, ten percent (10%) or more of the common stock or equivalent
equity interests. As used herein, the term “control” means possession, directly
or indirectly, of the power to direct or cause the direction of the management
or policies of a Person, whether through the ownership of voting securities or
otherwise.

 

(ii)         As used in this Agreement, “Person” means an individual, a
corporation, a partnership, a limited liability company, an association, a trust
or any other entity or organization.

 

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(b)          Confidential Information. As used in this Agreement, “Confidential
Information” means information belonging to the Employer or its Affiliates which
is of value to the Employer or any of its Affiliates in the course of conducting
its business (whether having existed, now existing, or to be developed or
created during Employee’s employment by Employer) and the disclosure of which
could result in a competitive or other disadvantage to the Employer or its
Affiliates. Confidential Information includes, without limitation, contract
terms and rates; negotiating and contracting strategies; facility participation
status; financial information, reports, and forecasts; inventions, improvements
and other intellectual property; product plans or proposed product plans; trade
secrets; know how; designs, processes or formulae; software; market or sales
information, plans or strategies; employee, customer, patient, provider and
supplier information; information from patient medical records; financial data;
insurance reimbursement methodologies, strategies, and practices; product and
service pricing methodologies, strategies and practices; contracts with
physicians, providers, provider networks, payors, physician databases and
contracts with hospitals; regulatory and clinical manuals; and business plans,
prospects and opportunities (such as possible acquisitions or dispositions of
businesses or facilities) that have been discussed or considered by the Employer
or its Affiliates, including without limitation the management of the Employer
or its Affiliates. Confidential Information includes information developed by
the Employee in the course of the Employee’s employment by the Employer, as well
as other information to which the Employee may have access in connection with
the Employee’s employment. Confidential Information also includes the
confidential information of others with which the Employer or its Affiliates has
a business relationship. Notwithstanding the foregoing, Confidential Information
does not include information in the public domain, unless due to breach of the
Employee’s duties under Section 6(b), unless otherwise due to Employee’s breach
of the obligations in this Agreement, or unless due to violation of another
person’s obligations to the Employer or its Affiliates that Employee should have
taken reasonable measures to prevent but that Employee did not take..

 

(c)          Confidentiality. The Employee understands and agrees that the
Employee’s employment creates a relationship of confidence and trust between the
Employer and the Employee with respect to all Confidential Information. At all
times, both during the Employee’s employment with the Employer and after the
Employee’s termination from employment for any reason, the Employee shall keep
in confidence and trust all such Confidential Information, and shall not use,
disclose, or transfer any such Confidential Information without the written
consent of the Employer, except as may be necessary within the scope of
Employee’s duties with Employer and in the ordinary course of performing the
Employee’s duties to the Employer. Employee understands and agrees not to sell,
license or otherwise exploit any products or services which embody or otherwise
exploit in whole or in part any Confidential Information or materials. Employee
acknowledges and agrees that the sale, misappropriation, or unauthorized use or
disclosure in writing, orally or by electronic means, at any time of
Confidential Information obtained by Employee during or in connection with the
course of Employee’s employment constitutes unfair competition. Employee agrees
and promise not to engage in unfair competition with Employer or its Affiliates,
either during employment or at any time thereafter.

 

(d)          Documents, Records, etc. All documents, records, data, apparatus,
equipment and other physical property, whether or not pertaining to Confidential
Information, that are furnished to the Employee by the Employer or its
Affiliates or are produced by the Employee in connection with the Employee’s
employment will be and remain the sole property of the Employer and its
Affiliates. The Employee shall return to the Employer all such materials and
property as and when requested by the Employer. In any event, the Employee shall
return all such materials and property immediately upon termination of the
Employee’s employment for any reason. The Employee shall not retain any such
material or property or any copies thereof after such termination. It is
specifically agreed that any documents, card files, notebooks, programs, or
similar items containing customer or patient information are the property of the
Employer and its Affiliates regardless of by whom they were compiled.

 

(e)          Disclosure Prevention. The Employee will take all reasonable
precautions to prevent the inadvertent or accidental exposure of Confidential
Information.

 

(f)           Removal of Material. The Employee will not remove any Confidential
Information from the Employer’s or its Affiliate’s premises except for use in
the Employer’s business, and only consistent with the Employee’s duties with the
Employer.

 

(g)          Copying. The Employee agrees that copying or transfer of
Confidential Information (by any means) shall be done only as needed in
furtherance of and for use in the Employer’s and its Affiliate’s business, and
consistent with the Employee’s duties with the Employer. The Employee further
agrees that copies of Confidential Information shall be treated with the same
degree of confidentiality as the original information and shall be subject to
all restrictions herein.

 

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(h)          No “Moonlighting”. During the Employee’s employment with the
Employer, the Employee agrees not to accept or continue in any job, consulting
work, directorship, or employment that may conflict with Employee’s duties and
responsibilities to Employer, including the duty of loyalty, without the written
approval of senior management of the Employer.

 

(i)           Computer Security. During the Employee’s employment with the
Employer, the Employee agrees only to use the Employer’s and its Affiliate’s
computer resources (both on and off the Employer’s premises) for which the
Employee has been authorized and granted access. The Employee agrees to comply
with the Employer’s policies and procedures concerning computer security.

 

(j)           E-Mail. The Employee acknowledges that the Employer retains the
right to review any and all electronic mail communications made with employer
provided email accounts, hardware, software, or networks, with or without
notice, at any time.

 

(k)          Assignment. The Employee acknowledges that any and all inventions,
discoveries, designs, developments, methods, modifications, improvements, trade
secrets, processes, software, formulae, data, “know-how,” databases, algorithms,
techniques and works of authorship whether or not patentable or protectable by
copyright or trade secret, made or conceived, first reduced to practice, or
learned by the Employee, either alone or jointly with others, during the Term
that (i) relate to or are useful in the business of the Employer or its
Affiliates, or (ii) are conceived, made or worked on at the expense of or during
the Employee’s work time for the Employer, or using any resources or materials
of the Employer or its Affiliates, or (iii) arise out of tasks assigned to the
Employee by the Employer (together “Proprietary Inventions”) will be the sole
property of the Employer or its Affiliates. The Employee acknowledges that all
work performed by the Employee is on a “work for hire” basis and the Employee
hereby assigns or agrees to assign to the Employer the Employee’s entire right,
title and interest in and to any and all Proprietary Inventions and related
intellectual property rights. The Employee agrees to assist the Employer to
obtain, maintain and enforce intellectual property rights for Proprietary
Inventions in any and all countries during the Term, and thereafter for as long
as such intellectual property rights exist.

   

NOTICE TO CALIFORNIA EMPLOYEES

 

Pursuant to California Labor Code § 2872, an agreement requiring the employee to
assign or offer to assign any of his or her rights in any invention to his or
her employer does not apply to an invention which qualifies fully under the
provisions of California Labor Code § 2870, which provides as follows:

 

(a) Any provision in an employment agreement which provides that an employee
shall assign, or offer to assign, any of his or her rights in an invention to
his or her employer shall not apply to an invention that the employee developed
entirely on his or her own time without using the employer’s equipment,
supplies, facilities, or trade secret information except for those inventions
that either:

 

(1) Relate at the time of conception or reduction to practice of the invention
to the employer’s business, or actual or demonstrably anticipated research or
development of the employer; or

 

(2) Result from any work performed by the employee for the employer.

 

(b) To the extent a provision in an employment agreement purports to require an
employee to assign an invention otherwise excluded from being required to be
assigned under subdivision (a), the provision is against the public policy of
the State of California and is unenforceable.

 

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(l)          Nonsolicitation. Employee agrees and covenants that, at any time
during the Employee’s employment with the Employer and for a period of twelve
(12) months immediately following the termination of the Employee’s relationship
with the Employer for any reason, whether with or without cause, the Employee
shall not, either on the Employee’s own behalf or on behalf of any other person:
(i) solicit the services of or entice away, directly or indirectly, any person
employed or engaged by or otherwise providing services to the Employer or its
Affiliates (this provision does not prohibit the Employee’s post-termination
acceptance of unsolicited applications for employment); or (ii) take any illegal
action or engage in any unfair business practice, including without limitation
any misappropriation of confidential, proprietary, or trade secret information
of the Employer or its Affiliates, as a result of which relations between the
Employer or its Affiliates, and any of their customers, clients, suppliers,
distributors or others, may be impaired or which might otherwise be detrimental
to the business interests or reputation of the Employer or its Affiliates.

 

(m)          Third-Party Agreements and Rights. The Employee hereby confirms
that the Employee is not bound by the terms of any agreement with any previous
employer or other party which restricts in any way the Employee’s use or
disclosure of information or the Employee’s engagement in any business except as
Employee has previously provided written notice to Employer and has attached to
this Agreement. The Employee represents to the Employer that the Employee’s
execution of this Agreement, the Employee’s employment with the Employer and the
performance of the Employee’s proposed duties for the Employer will not violate
any obligations the Employee may have to any previous employer or other party.
In the Employee’s work for the Employer, the Employee will not disclose or use
any information in violation of any agreements with or rights of any such
previous employer or other party, and the Employee will not bring to (by any
means) the premises of the Employer any copies or other tangible embodiments of
non-public information belonging to or obtained from any such previous
employment or other party.

 

(n)          Litigation and Regulatory Cooperation. During and after the
Employee’s employment, the Employee shall cooperate fully with the Employer in
the defense or prosecution of any claims or actions now in existence or that may
be brought in the future against or on behalf of the Employer that relate to
events or occurrences that transpired while the Employee was employed by the
Employer. The Employee’s full cooperation in connection with such claims or
actions shall include, but not be limited to, being available to meet with
counsel to prepare for discovery or trial and to act as a witness on behalf of
the Employer at mutually convenient times. During and after the Employee’s
employment, the Employee also shall cooperate fully with the Employer in
connection with any investigation or review of any federal, state, or local
regulatory authority as any such investigation or review relates to events or
occurrences that transpired while the Employee was employed by the Employer. The
Employer shall reimburse the Employee for any reasonable out of pocket expenses
incurred in connection with the Employee’s performance of obligations pursuant
to this Section. “Full cooperation” shall not be construed to in any way require
any violation of law or any testimony that is false or misleading.

 

(o)          Enforcement; Injunction. The Employee acknowledges and agrees that
the restrictions contained in this Agreement are reasonable and necessary to
protect the business and interests of the Employer and its Affiliates, do not
create any undue hardship for the Employee, and that any violation of the
restrictions in this Agreement would cause the Employer and its Affiliates
substantial irreparable injury. Accordingly, the Employee agrees that a remedy
at law for any breach or threatened breach of the covenants or other obligations
in Section 6 this Agreement would be inadequate and that the Employer, in
addition to any other remedies available, shall be entitled to obtain
preliminary and permanent injunctive relief to secure specific performance of
such covenants and to prevent a breach or contemplated or threatened breach of
this Agreement without the necessity of proving actual damage and without the
necessity of posting bond or security, which the Employee expressly waives.
Moreover, the Employee will provide the Employer a full accounting of all
proceeds and profits received by the Employee as a result of or in connection
with a breach of Section 6 this Agreement. The Employee hereby agrees to
indemnify and hold harmless the Employer and its Affiliates from and against any
damages incurred by the Employer or its Affiliates as assessed by a court of
competent jurisdiction as a result of any breach of Section 6 of this Agreement
by the Employee. The prevailing party shall be entitled to recover its
reasonable attorneys’ fees and costs if it prevails in any action to enforce
Section 6 of this Agreement. It is the express intention of the parties that the
obligations of Section 6 the Agreement shall survive the termination of the
Employee’s employment. The Employee agrees that each obligation specified in
Section 6 of this Agreement is a separate and independent covenant that shall
survive any termination of this Agreement and that the unenforceability of any
of them shall not preclude the enforcement of any other covenants in Section 6
of this Agreement. No change in the Employee’s duties or compensation shall be
construed to affect, alter or otherwise release the Employee from the covenants
herein.

 

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7.           Successors. This Agreement shall be binding upon and inure to the
benefit of both parties and their respective successors and permitted assigns,
including any corporation or entity with which or into which the Employer may be
merged or which may succeed to its assets or business, provided, however, that
Employee’s obligations are personal and shall not be assigned by the Employee.
The Employee consents to any assignment by the Employer of this Agreement. In
the event of the Employee’s death after the Date of Termination but prior to the
completion by the Employer of all payments due to the Employee under this
Agreement, the Employer shall continue such payments to the Employee’s
beneficiary designated in writing to the Employer prior to the Employee’s death
(or to the Employee’s estate, if the Employee fails to make such designation).

 

8.           Enforceability. If any portion or provision of this Agreement shall
to any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

 

9.           Waiver. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.

 

10.         Notices. Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by registered or certified mail, postage prepaid, to the
Employee at the last address for which the Employee has provided written notice
to the Employer, or to the Employer at its main office, attention of Human
Resources.

 

11.         Publications. Employee agrees not to submit any writing for
publication or deliver any speech that contains any information relating to the
business of the Employer, unless the Employee receives advance written clearance
from an authorized representative of the Employer.

 

12.         Publicity. The Employee hereby grants to the Employer the right to
use the Employee’s name and likeness, without additional consideration, on, in
and in connection with technical, marketing and/or disclosure materials
published by or for the Employer for the duration of Employee’s employment with
Employer and for a reasonable period of time following the Date of Termination.

 

13.         Conflicting Obligations and Rights. The Employee agrees to inform
the Employer of any apparent conflicts between the Employee’s work for the
Employer and (a) any obligations the Employee may have to preserve the
confidentiality of another’s proprietary information or materials or (b) any
rights the Employee claims to any inventions or ideas before using the same on
the Employer’s behalf. Otherwise, the Employer may conclude that no such
conflict exists and the Employee agrees thereafter to make no such claim against
the Employer. The Employer shall receive such disclosures in confidence and
consistent with the objectives of avoiding any conflict of obligations and
rights or the appearance of any conflict of interest.

 

14.         Notification of New Employer. In the event that the Employee leaves
the employ of the Employer, voluntarily or involuntarily, the Employee agrees to
inform any subsequent employer of the Employee’s obligations under Section 6 of
this Agreement. The Employee further hereby authorizes the Employer to notify
the Employee’s new employer about the Employee’s obligations under Section 6 of
this Agreement.

 

15.         Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes in
all respects all prior agreements as well as all express or implied negotiations
and agreements, between the parties concerning such subject matter.

 

16.         Amendment. This Agreement may be amended or modified only by a
written instrument signed by the Employee and by a duly authorized
representative of the Employer.

 

17.         Governing Law. This is a California contract and shall be construed
under and be governed in all respects by the laws of the State of California,
without giving effect to the conflict of laws principles of such State.

 

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18.         Obligations of Successors. The Employer shall require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the business or assets of the Employer to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Employer would be required to perform if no such succession had
taken place.

 

19.         Consent to Jurisdiction; Forum Selection. At all times the Employee
and Employer: (a) irrevocably submit to the exclusive jurisdiction of the Los
Angeles Superior Court and United States District Court for the Central District
of California, whichever may have competent subject matter jurisdiction, in any
action or proceeding arising out of or relating to this Agreement, and
irrevocably agree that all claims in respect of any such action or proceeding
may be heard and determined in such court; (b) to the extent permitted by law,
irrevocably consent to the service of any and all process in any such action or
proceeding by the mailing of copies of such process to such party at the address
set forth in this Agreement (or otherwise on record with the Employer); (c) to
the extent permitted by law, irrevocably confirm that service of process out of
such courts in such manner shall be deemed due service upon such party for the
purposes of such action or proceeding; (d) to the extent permitted by law,
irrevocably waives (i) any objection the Employee or Employer may have to the
laying of venue of any such action or proceeding in any of such courts, or (ii)
any claim that the Employee or Employer may have that any such action or
proceeding has been brought in an inconvenient forum; and (e) to the extent
permitted by law, irrevocably agrees that a final non-appealable judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Section shall affect the right of any party hereto to serve
legal process in any manner permitted by law.

 

20.         Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

 

IN WITNESS WHEREOF, this Agreement has been executed as of the date first above
written.

 

EMPLOYER:       BAY AREA HOSPITALIST ASSOCIATES, A CALIFORNIA PROFESSIONAL
CORPORATION         By:  /s/ Warren Hosseinion         Name:  Warren Hosseinion
        Its:  Chief Executive Officer         EMPLOYEE:          /s/ Scott
Enderby         Name: Scott Enderby          

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EXHIBIT A

 

Release of Claims

 

I, Scott Enderby, in consideration of and subject to the performance by Bay Area
Hospitalist Associates, A Medical Corporation (the “Company”) of its obligations
under the Employment Agreement dated as of November 4, 2016 (as the same may be
amended from time to time, the “Agreement”), do hereby release and forever
discharge as of the date of my execution of this release (the “Release”) the
Company, its affiliated and related entities, its and their respective
predecessors, successors and assigns, its and their respective employee benefit
plans and fiduciaries of such plans, and the current and former officers,
directors, shareholders, employees, attorneys, accountants and agents of each of
the foregoing in their official and personal capacities (collectively, the
“Released Parties”) to the extent provided below.

 

  1. I understand that any payments or benefits paid or granted to me under
Section 5(b) of the Agreement represent, in part, consideration for signing this
Release and are not salary, wages or benefits to which I was already entitled.
Such payments and benefits will not be considered compensation for purposes of
any employee benefit plan, program, policy or arrangement maintained or
hereafter established by the Company or its affiliates.

 

  2. Releases.

 

(a)          I knowingly and voluntarily (on behalf of myself, my spouse, my
heirs, executors, administrators, agents and assigns, past and present) fully
and forever release and discharge the Company and the other Released Parties
from any and all claims, suits, controversies, actions, causes of action, cross
claims, counterclaims, demands, debts, liens, contracts, covenants, suits,
rights, obligations, expenses, judgments, compensatory damages, liquid damages,
punitive or exemplary damages, other damages, claims for costs and attorneys’
fees, orders and liabilities of whatever kind of nature, in law and in equity,
in contract of in tort, both past and present (through the date this General
Release becomes effective and enforceable) and whether known or unknown, vested
or contingent, suspected, or claimed, against the Company or any of the Released
Parties which I, my spouse, or any of my heirs, executors, administrators or
assigns, may have, which arise out of or relate to my employment with, or my
separation or termination from, the Company up to the date of my execution of
this Release (including, but not limited to, any allegation, claim of violation
arising under: Title VII of the Civil Rights Act of 1964, as amended; the Civil
Rights Act of 1991; the Age Discrimination in Employment Act of 1967, as amended
(including the Older Workers Benefit Protection Act), the Equal Pay Act of 1963,
as amended; the Americans with Disabilities Act of 1990; the Family and Medical
Leave Act of 1993; the Worker Adjustment Retraining and Notification Act; the
Employee Retirement Income Security Act of 1974; the Fair Labor Standards Act;
or their state or local counterparts; or under any other federal, state or local
civil or human rights law, or under any other local state or federal law,
regulation or ordinance; or under any public policy, contract of tort, or under
common law; or arising under any policies, practices or procedures of the
Company; or any claim for wrongful discharge, breach of the Agreement,
infliction of emotional distress or defamation; or any claim for costs, fees, or
other expenses, including attorneys’ fees incurred in these matters)
(collectively, the “Claims”).

 

(b)          SECTION 1542 WAIVER. Employee agrees that all rights he may have
under Section 1542 of the California Civil Code are hereby waived. Section 1542
provides:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.”

 

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Notwithstanding the provisions of Section 1542, and for the purpose of
implementing a full and complete release, Employee agrees that this Agreement is
intended to include all claims, if any, that Employee may have against the
Company, and that this Agreement extinguishes those claims.

 

  3. I represent that I have made no assignment of transfer of any right, claim,
demand, cause of action, or other matter covered by Section 2 above.

 

  4. In signing this Release, I acknowledge and intend that it shall be
effective as a bar to each and every one of the claims, demands and causes of
action herein above mentioned or implied. I expressly consent that this Release
shall be given full force and effect according to each and all of its express
terms and provisions, including those relating to unknown and unsuspected claims
up to the date of my execution of this Release, if any, as well as those
relating to any other claims hereinabove mentioned. I acknowledge and agree that
this waiver is an essential and material term of this Release and that without
such waiver the Company would not have agreed to the terms of the Agreement. I
further agree that in the event I should bring a claim seeking damages against
the Company, this Release shall serve as a complete defense to such claims as to
my rights and entitlements. I further agree that I am not aware of any pending
charge or complaint of the type described in Section 2 as of the date of my
execution of this Release.

 

  5. I agree that neither this Release, nor the furnishing of the consideration
for this Release, shall be deemed or constructed at any time to be an admission
or acknowledgement by the Company, any Released Party or myself of any improper
or unlawful conduct.

 

  6. I agree and acknowledge that the provisions, conditions, and negotiations
of this Release are confidential and agree not to disclose any information
regarding the terms, conditions and negotiations of this Release, nor transfer
any copy of this Release to any person or entity, other than my immediate family
and any tax, legal or other counsel or advisor I have consulted regarding the
meaning or effect hereof or as required by applicable law, and I will instruct
each of the foregoing not to disclose the same to anyone.

 

  7. Notwithstanding anything in the Release to the contrary, nothing in this
Release shall be deemed to affect, impair, relinquish, diminish, or in any way
affect any rights or claims in any respect to (i) any vested rights or other
entitlements that I may have as of the date of my execution of this Release
under the Company’s 401(k) plan; (ii) any other vested rights or other
entitlements that I may have as of the date of my execution of this Release
under any employee benefit plan or program, in which I participated in my
capacity as an employee of the Company; (iii) my rights under the Agreement; or
(iv) my rights under the Release.

 

  8. I understand that I continue to be bound by Section 6 of the Agreement.

 

  9. Whenever possible, each provision of this Release shall be interpreted in
such a manner as to be effective and valid under applicable law, but if any
provisions of this Release are held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
or any other jurisdiction, but this Release shall be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or unenforceable
provisions had never been contained herein.

 

  10. This Release shall be governed by and construed in accordance with the
laws of the State of California, without giving effect to the conflict of laws
principles of the State of California.

 

BY SIGNING THIS RELEASE, I REPRESENT AND AGREE THAT:

 

  (i) I HAVE READ IT CAREFULLY;

 

  (ii) I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT
RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN
EMPLOYMENT ACT OF 1967, AS AMENDED;

 

  (iii) I VOLUNTARILY CONSENT TO EVERYTHING IN IT;

 

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  (iv) THE COMPANY IS HEREBY ADVISING ME TO CONSULT WITH AN ATTORNEY BEFORE
EXECUTING IT, I HAVE HAD THE OPPORTUNITY TO SO CONSULT, AND HAVE AVAILED MYSELF
OF SUCH ADVICE TO THE EXTENT I HAVE DEEMED NECESSARY TO MAKE A VOLUNTARY AND
INFORMED CHOICE TO EXECUTE THIE RELEASE;

 

  (v) I HAVE HAD AT LEAST TWENTY ONE (21) DAYS [45 DAYS IN CONNECTION WITH A
GROUP TERMINATION OR EXIT INCENTIVE PLAN] FOLLOWING THE DATE OF TERMINATION OF
MY EMPLOYMENT TO CONSIDER THIS RELEASE;

 

  (vi) CHANGES TO THIS RELEASE, WHETHER MATERIAL OR IMMATERIAL, DO NOT RESTART
THE RUNNING OF THE 21-DAY [OR 45 DAY] CONSIDERATION PERIOD;

 

  (vii) I UNDERSTAND THAT I HAVE SEVEN (7) DAYS AFTER THE EXECUTION OF THIS
RELEASE TO REVOKE IT, SUCH REVOCATION TO BE RECEIVED IN WRITING BY THE COMPANY
BY THE END OF THE SEVENTH DAY AFTER THE DATE HEREOF, AND THAT THIS RELEASE SHALL
NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE REVOCATION PERIOD HAS EXPIRED;

 

  (viii) I HAVE SIGNED THIS RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE
ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND

 

  (ix) I AGREE THAT THE PROVISIONS OF THIS RELEASE MAY NOT BE AMENDED, WAIVED OR
MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED
REPRESENTATIVE OF THE COMPANY AND BY ME.

 

DATED AS OF               , 20                Scott Enderby       

 

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