Document:

exv10w2

 

Exhibit 10.2

AMENDED
AND RESTATED MANAGEMENT AGREEMENT

     THIS
AGREEMENT is made and entered into as of the 1st day of May, 2007 by and between
PROINVEST REALTY FUND, LLC, a Delaware Limited Liability Company (“Owner”) and PROINVEST REALTY
ADVISORS, LLC, a Texas Limited Liability Company (“Proinvest”). Capitalized terms used herein and
not defined shall have the meaning defined in the LLC Agreement (hereinafter defined).

WITNESSETH

     WHEREAS, Owner has been formed pursuant to the terms and conditions of that certain Limited
Liability Company Agreement of Proinvest Realty Fund LLC (the
“LLC Agreement”), dated effective
May 1, 2007, by and between Proinvest and G N Olson & Company, LLC (“Olson & Co”), a Texas limited
liability company, as amended and restated, to function as a publicly registered but non-traded
commercial real estate investment fund, as described the Prospectus (“Prospectus”) for the Owner
filed with its Registration Statement Form S-11, dated June 28, 2007, as amended, and filed with
the United States Securities and Exchange Commission;

     WHEREAS, Proinvest has been elected Manager of the Owner pursuant to the LLC Agreement; and

     NOW, THEREFORE, in consideration of the mutual promises herein contained and for other good
and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:

ARTICLE
I.

APPOINTMENT OF PROINVEST

     Owner hereby retains Proinvest as an independent contractor for the purpose of performing the
services described in this Agreement and Proinvest hereby agrees to perform the services on the
terms and conditions set forth herein. Subject to such terms and
conditions, Proinvest shall
provide advisory, consultation and management services in accordance with this Agreement and shall
formulate and implement the Business Plans (hereafter defined) for the purpose of enabling Owner to
maximize the value of the assets of the Company as described in the LLC Agreement (all together,
the “Assets;” any one, an “Asset”) while diligently endeavoring to minimize the risks associated
therewith. Proinvest agrees to use its best efforts to manage the

1

 

Assets in accordance with this Agreement

ARTICLE II.

TERM OF AGREEMENT

     This Agreement shall continue in force until ten (10) years (the “Initial Term”) after the
date hereof (the “Initial Term”) unless earlier terminated in accordance with Article XII or
extended by Owner in accordance with this Article II; provided, however, that the
provisions of Article X hereof shall remain in full force and effect and such termination shall not
affect the obligation of Owner to pay to Proinvest any amount that is payable to Proinvest pursuant
to this Agreement and which has not been paid on the date of such termination. Proinvest shall have
the right, at its option, to extend the term of this Agreement for one (1) or more successive
renewal terms (each, a “Renewal Term”) of one (1) year each provided that Proinvest sends written
notice to Owner of such extension not later than thirty (30) days before the end of the Initial
Term or the preceding Renewal Term, as the case may be, for the purpose of liquidating the Assets
and terminating the business of the Owner as contemplated by Article XIII of the LLC Agreement.

ARTICLE III.

ASSETS SUBJECT TO AGREEMENT

     The Assets will be acquired, financed, developed or redeveloped and sold in accordance with
the Owner’s business plan (the “Owner’s Business Plan”) and as described in the LLC Agreement and
the Prospectus and in compliance with Proinvest’s Policies and Procedures Manual (the “Asset
Management Manual”), dated of even date herewith, as heretofore amended and as hereafter amended
from time to time with the written approval of the Owner. Each Asset shall have an “Initial
Value,” based on the amount of the purchase price paid by Owner for the Asset, plus all costs of
acquisition and all costs of capital improvements to the Asset provided for in the initial annual
Asset Business Plan (hereafter defined) for each Asset prepared by Proinvest and approved by
Owner.

     Each Asset acquisition and its initial Asset Business Plan must be approved, in writing, by
the Executive Committee of the Owner, in the manner and within the time limitations set forth in
the Asset Management Manual.

     Proinvest, in conjunction with the property manager and the leasing and marketing agent for
each Asset, will prepare a comprehensive plan (“Asset Business
Plan”) for the operation,
maintenance, utilization and economic development of the Asset for the balance of calendar year

2

 

of the Asset’s acquisition, submitting such Asset Business Plan, along with recommendations with
respect to achieving maximum economic returns to the Owner from the Asset within thirty (30) days
of the date after the contract for the acquisition of the Asset. The Asset Business Plan shall be
prepared in a format detailed in the Asset Management Manual and shall include a detailed narrative
description of the plan. All permanent policies or actions required pursuant to the Asset Business
Plan are subject to the approval of the Executive Committee of the Owner. On or before November 15
of each calendar year during the term of this Agreement, Proinvest shall prepare and submit to the
Owner for its approval an annual Asset Business Plan for each Asset for the next succeeding
calendar year. Each proposed Asset Business Plan submitted following the initial Asset Business
Plan shall include an explanation of and commentary on the Asset’s performance and variances from
the Asset Business Plan and the Asset Budget (hereinafter defined) for the prior calendar year.

     Each Asset Business Plan shall include (a) the current status of the Asset, including its
physical condition, operations, leasing and management; (b) an analysis of the market area of the
Asset; (c) a financial analysis, including a statement of its current financial situation; (d)
recommendations as to a rental schedule; (e) a plan for securing tenants; (f) a plan for
maintaining the Asset and, if appropriate, a capital budget for rehabilitating or improving the
Asset and a schedule for employees, if any; and (g) and Asset Budget.

ARTICLE IV.

PROINVEST’S DUTIES

     4.1. Scope of Proinvest’s Duties and Responsibilities. Proinvest’s duties under this
Agreement shall be to provide asset management services for the Assets and to advise Owner on the
manner Proinvest deems best to manage the Assets and to implement the Asset Business Plans and the
Owner’s Business Plan. The Asset Business Plan is the asset-specific plan mutually approved by
Owner and Proinvest for the acquisition, management and disposition of the Asset, as the same may
be amended or modified from time to time, subject to the approval of Owner. Proinvest shall
coordinate and manage the legal, property leasing and management, marketing and other necessary
services to implement the Asset Business Plans, and Proinvest’s duties shall include, but not be
limited to, the following:

          (a) Proinvest shall submit to Owner from time to time, but not less frequently than
quarter-annually by the date which is fifteen (15) days after the end of each calendar quarter,
proposed revisions to the Asset Business Plans for Owner’s approval whenever Proinvest or Owner
reasonably determines that revisions to any Asset Business Plan would be in the best interests of
the Owner;

3

 

          (b) Proinvest shall ensure the timely filing at Owner’s expense of tax certiorari petitions
or other appropriate real estate tax challenges for the Assets and shall engage attorneys, at the
cost of Owner (provided that the Owner shall be entitled to review all invoices), to provide legal
services to Owner with respect to the Assets and the implementation of the Asset Business Plans;

          (c) Proinvest
shall engage environmental consultants and other professionals, at the cost of
Owner (provided that the Owner shall be entitled to review all invoices), to perform environmental
and physical condition evaluations of the Assets;

          (d) Proinvest shall inspect (or cause to be inspected) the physical condition of the Assets at
such intervals, not less frequently than quarterly, that Proinvest deems appropriate and Proinvest
shall provide Owner with a written report of such inspections;

          (e) Proinvest shall negotiate with prospective third party purchasers for the disposition of
the Assets in accordance with the Asset Business Plans;

          (f) unless otherwise required by a mortgagee or mortgagees of the Assets, Proinvest shall
establish and maintain (or require the applicable property manager to establish and maintain), to
the extent funds are received from the Assets or otherwise made available therefor, escrow
accounts in order to ensure the timely payment of real estate taxes and insurance premiums in
respect of the Assets;

          (g) consistent with prudent real property management practices and the requirements of any
mortgagee or mortgagees of the Assets, Proinvest shall maintain or cause to be maintained at
Owner’s cost and expense (i) a standard hazard insurance policy providing fire and extended
coverage insurance in an amount equal to the full insurable value of the Assets; (ii)
comprehensive general liability insurance including bodily injury, death and property damage
liability in usual and customary amounts; and (iii) to the extent required (because any Asset is
in an area identified in the Federal Register by the Federal Emergency Management Agency as having
special flood hazards) and available under the Flood Disaster Protection Act of 1973, as amended,
a flood insurance policy meeting the requirements of the current guidelines of the Federal
Insurance Administration with an insurance carrier generally acceptable to commercial and
multifamily mortgage lending institutions for properties similar to the affected Asset, in an
amount representing coverage not less than the lesser of (i) the full insurable value of the
affected Asset, or (iii) the maximum amount of insurance which is available under the Flood
Disaster Protection Act of 1973, with each such insurance policy naming the Owner as a loss payee;

          (h) Proinvest shall assist Owner in negotiating with third party lenders for
the

4

 

financing or refinancing of the Assets and shall assist in concluding such financing and
refinancing arrangements, subject to approval thereof by the Executive Committee of the Owner;

          (i) Proinvest shall engage third parties approved by Owner (which third parties may include
Affiliates), at the cost of Owner, to provide property management services to Owner pursuant to
the property management agreement approved by Owner as a part of the Asset Management Manual;

          (j) Proinvest shall evaluate the information provided to Proinvest concerning any casualty
loss affecting the Assets, including whether the loss is covered by a casualty insurance policy,
and shall advise and assist Owner in filing claims and settling claims in respect of such loss;
and

          (k) Proinvest shall assist Owner in the negotiation and implementation of construction
agreements with respect to the development, construction, or rehabilitation of any improvements in
or to the Assets provided for in the Asset Business Plans.

Proinvest shall collect all revenues from the Assets and deposit the same in the Operating Account
(defined below in Section 5.8) or shall assist and oversee the property manager or managers
engaged pursuant to paragraph (i) of this Section 4.1 in the collection of such revenues and shall
deposit or cause to be deposited such revenues in the Operating Account.

     4.2. Owner’s Budgets. Within ninety (90) days following the date of this Agreement
and within 45 days prior to the beginning of each calendar year thereafter, Proinvest shall submit
to the Owner, for approval by the Executive Committee of the Owner, an annual budget (the “Owner’s
Budget”) for costs to be incurred pursuant to this Agreement. Proinvest shall submit to Owner from
time to time, but not less frequently than quarter-annually by the date which is fifteen days
after the end of each calendar quarter, proposed revisions to the Owner’s Budget for approval by
the Executive Committee of the Owner whenever Proinvest determines that revisions should be made
to the Owner’s Budget. In the event that an Owner’s Budget has not been approved for any year, the
Owner’s Budget approved for the preceding year shall apply to the current year until an Owner’s
Budget is approved for the current year, adjusted in proportion to the Initial Value of the Assets
and otherwise appropriately adjusted for changes in the Assets. The Owner’s Budget shall reflect
all of the costs and expenses to the Owner to be incurred under this Agreement, including the
revenues, costs, and expenses of and from the Assets, as reflected in the individual budgets (any
one, “Asset Budget;” all together, “Asset Budgets”) prepared by Proinvest for the approval of the
Owner from time to time as required hereby pertaining to the individual Assets.

     4.3.
Limitations on Proinvest’s Authority. Proinvest shall not
have the authority,

5

 

without obtaining the prior written approval of the Executive Committee of the Owner, to: (i) sell
or hypothecate any Asset, except as may be provided in the respective Asset Business Plan; (ii)
incur any costs on behalf of Owner if the amount thereof would result in an increase in any line
item of the respective approved Asset Budget by more than ten percent (10%); (iii) effectuate any
transaction that is not in accordance with (or more favorable to Owner than) the respective Asset
Business Plan; (iv) act on behalf of, or hold itself out as having the authority to act on behalf
of, the Owner in any manner which is beyond the scope of the terms of this Agreement; or (v) take
any other action with respect to any Asset if specifically prohibited in advance by Owner in
writing (unless such action was required by any law, rule, regulation or order of any governmental
authority, or was required, based on Proinvest’s good faith belief, to prevent imminent harm to
persons or property). Subject to the foregoing limitations on the authority of Proinvest, Proinvest
shall have the authority, in Owner’s name, to take all action that it determines to be in the best
interests of the Owner with respect to the duties and responsibilities of Proinvest under this
Agreement.

     4.4. Requests for Approval by Owner. Owner shall act promptly with respect to any
written request by Proinvest for approval (which approval shall be effective only if given in
writing, provided however, that if the approval requested by Proinvest in its written request is
not approved or disapproved by Owner in writing within ten (10) days after Owner’s receipt of such
request, the request shall be deemed approved) of any action proposed to be taken by Proinvest or
any amendment to the Owner’s Budget, any Asset Budget, or the Owner’s Business Plan proposed by
Proinvest. Proinvest’s requests for approval or consent by Owner under this Agreement shall in no
event be unreasonably withheld, delayed, conditioned, or denied. A request by Owner for additional
information or a modification shall be deemed disapproval until 10 days after the modification is
made or additional information is provided.

     4.5. Standard of Performance. Proinvest shall at all times act in good faith and in
the best interests of Owner with respect to the Assets and, using its best efforts, shall carry
out its obligations hereunder in accordance with normal and prudent practices in the real estate
asset management business. It is acknowledged, understood and agreed, that recommendations to be
made by Proinvest in connection with the performance of its services under this Agreement,
including without limitation, those relating to whether and how to assert claims against third
parties, restructure loans or liquidate or otherwise dispose of any Asset, involve highly
subjective judgments and may result in unanticipated consequences. Proinvest assumes no
responsibility under this Agreement other than to render the services called for hereunder in
accordance with the standard set forth above and shall not be responsible to Owner, or others, for
any action of Owner in following or declining to follow any recommendation of Proinvest unless
such recommendation was specifically given in writing and in giving such recommendation Proinvest
was acting with gross negligence, bad faith or willful misconduct. Proinvest and its affiliates,
directors, members, managers, officers, shareholders and employees shall not in any event be

6

 

liable
hereunder, except as set forth in this Section 4.5, and except that Proinvest shall be
liable for the indemnification provided in Section 10.1.1 and for any losses resulting from
Proinvest’s gross negligence or acts constituting a breach of Proinvest’s covenants or
representations contained herein, bad faith or willful misconduct.

ARTICLE V.

BOOKS,
RECORDS, REPORTS AND ACCOUNTS

     5.1.
Books and Records. At all times during the term of this Agreement, Proinvest
shall maintain at its principal place of business, or at such other location as it may reasonably
designate, a complete and accurate set of files, books and records of all business activities and
operations conducted by Proinvest in connection with Proinvest’s performance under this Agreement.
Proinvest shall make its files, books and records available to Owner as Owner may require from time
to time. On a monthly basis, Proinvest shall deliver to owner a duplicate set of all material
notices, correspondence, memoranda and other records relating to the Assets or to funds received or
generated by Proinvest during the prior month.

     5.2. Records Pertaining to Particular Assets. Proinvest’s records and accounts shall
reflect, with respect to the Assets, all items of expense incurred by Proinvest with respect to
the management of such Assets, as well as information regarding the status of such Assets,
including appraisal, marketing, environmental, engineering and other information.

     5.3. Retention of Records. Unless returned to Owner, or otherwise disposed of in
accordance with the written direction of Owner, for a period of not less than twelve (12) months
after the date of termination or expiration of this Agreement, Proinvest shall continue to
maintain all files and records pertaining to its performance under this Agreement.

     5.4 Information regarding Members. Proinvest shall maintain an alphabetical list of
the names, addresses and business telephone numbers of the Members along with the number of Units
held by each of them (the “Member List”) as a part of the books and records of the Owner, which
shall be available for inspection by any Member or his designated representative at the principal
office of the Owner during normal business hours upon the request of the Member. The Member List
shall be updated at least quarterly to reflect changes in the information contained therein.
Proinvest shall mail a copy of the Member List to any Member requesting the Member List within ten
(10) days of the request. The copy of the Member List to be mailed to a Member shall be printed in
alphabetical order, on white paper, and in readily readable type size (in no event smaller than
10-point type). A reasonable charge for copy work may be charged by Proinvest. The purposes for
which a Member may request a copy of the Member List include,

7

 

without limitation, matters relating to the Members’ voting rights under this Agreement and the
exercise of the Members’ rights under federal proxy laws. If Proinvest neglects or refuses to
exhibit, produce or mail a copy of the Member List as requested, it shall be liable to the Member
requesting the list for the costs, including attorneys’ fees, incurred by that Member for
compelling the production of the Member List and for actual damages suffered by the Member by
reason of such refusal or neglect. It shall be a defense that the actual purpose and reason for a
request for inspection of or a request for a copy of the Member List is to secure such list of
Members or other information for the purpose of selling such list or copies thereof or for the
purpose of using the same for a commercial purpose other than in the interest of the requesting
Member relative to the affairs of the Owner. Proinvest may require any Member requesting the Member
List to represent in writing that the list is not requested for a commercial purpose unrelated to
such Member’s interest in the Owner.

     5.5 financial Records. Proinvest shall maintain the books of account and other
records of the Owner. The books of account for financial accounting purposes shall be kept in
accordance with generally accepted accounting principles. Any Managing Director shall have the
right to inspect and copy such books and records at any time during normal business hours. Any
Managing Director shall have the right, not more often than once per year, to designate a
certified public accountant who is a senior member of a nationally recognized public accounting
firm to examine or audit the financial records of the Owner, which audit shall be at the joint
expense of the Owner and such Managing Director. Any Member shall have the right, not more often
than once per year, to designate a certified public accountant who is a senior member of a
nationally recognized public accounting firm to examine or audit the financial records of the
Owner, at the expense of such Member. Each Managing Director or Member desiring to examine or
audit the books or records of the Owner shall, prior to being provided access to such books or
records, execute agreements and assurances acceptable to the Owner regarding all confidential
information of the Owner, and regarding compliance with disclosure requirements under federal and
state securities laws, including but not limited to Regulation FD promulgated by the Securities
and Exchange Commission.

     5.6. Owner’s Right to Examine Books and Records. At all times during the term of this
Agreement and at all times during the twelve (12) month period following the expiration or
termination of this Agreement, Owner and its duly authorized agents, representatives or employees
may, at such reasonable times as Owner may determine, inspect, audit, and copy any of Proinvest’s
records, files, reports and related materials pertaining to the Assets and to Proinvest’s
performance under this Agreement; provided, however, Owner shall not have the right to copy any
proprietary information and materials of Proinvest, including without limitation the Policy and
Procedures Manual and related materials licensed to Proinvest by Olson & Co .

     5.7. Reports. Proinvest shall provide the following reports and information to the

8

 

Owner:

     (a) Acquisition Reports. Until the proceeds of the Offering available for investment
have been invested or committed for investment, Proinvest shall prepare and send to the Owner for
transmittal to the Members a quarterly report of any Asset acquisitions within the prior quarter.
Such report shall contain the following information (i) a description of the geographic location of
the Asset acquired within such quarter; (ii) a statement of the Contract Purchase Price including
terms of the purchase; (iii) the present or proposed use of such Asset; (vi) the terms of any
material lease affecting such Asset; (v) a description of the
proposed method of financing,
including estimated down payment and leverage ratio; and (vi) if known to Proinvest, a statement
regarding the amount of then received proceeds of the Offering (in both dollar amount and as a
percentage of the total net proceeds of the Offering anticipated to be available for investment in
Assets) which remain unexpended or uncommitted. Such quarterly report shall be provided by
Proinvest to the Owner within fifteen (15) days after the end of each calendar quarter.

     (b) Expense Reporting. Owner is required to provide, in the notes to the Owner’s
financial statements included in its annual reports on Form 10-K, a category-by-category breakdown
of the general and administrative expenses incurred by the Owner for the periods covered by the
annual report. This breakdown must reflect each type of general and administrative expense incurred
by the Owner (e.g. investor relations, independent accountants, salaries, rent, utilities,
insurance, filing fees, legal fees, etc.) and the amount charged to the Owner for each category of
expense incurred. Proinvest shall cause to be prepared and shall provide to the Owner within sixty
(60) days after the end of each fiscal year, a report of general and administrative expenses
incurred by Proinvest by or on behalf of Owner, reflecting each type of general and administrative
expense and the amount charged to the Owner for each category of expense incurred. Such reports
shall include (i) a statement of services rendered by Proinvest, and (2) the amount of fees
received, by category of fee, by Proinvest from Company.

     (c) Other Reports. Proinvest shall cause to be prepared and timely provided to the
Owner all information within the possession of Proinvest required or necessary to enable Owner to
file complete and accurate quarterly or annual reports required to be filed with appropriate
federal and state regulatory and administrative bodies under then currently applicable laws, rules
and regulations. Proinvest shall provide any information or assistance reasonably requested by
Owner in connection with such quarterly or annual reports.

     (d) Continuing
Monthly Reports. By the twentieth (20th) day of each month, Proinvest
shall prepare and deliver to Owner a monthly report detailing the operations, revenues and
expenses of the Assets. The Monthly Report shall include the following with respect to each Asset
and with respect to all of the Assets as a portfolio, in hard copy:

9

 

Monthly Report (“Monthly Report”)

     (1)  Property Management List

	 	•	 	Schedule of expenditures to be reimbursed pursuant to Article VI.
	 
	 	•	 	Manager’s Narrative Report (“Narrative Report”) on the Asset

	 
	 	•	 	Explanations Regarding Asset Budget Variances

	 
	 	•	 	Delinquency Report with Narrative

	 
	 	•	 	Detail to Accounts Receivable

	 
	 	•	 	Updated Rent Roll

	 
	 	•	 	Changes from Prior Month’s Rent Roll

     (2)  Accounting List

	 	•	 	Balance Sheet
	 
	 	•	 	Summary Operating Statement
	 
	 	•	 	Detailed Operating Statement showing all receipts and disbursements and reflecting the
financial condition of the Assets for the month immediately preceding.
	 
	 	•	 	A detailed explanation of variances to the Asset Budgets
	 
	 	•	 	Cash Flow Statement
	 
	 	•	 	Bank Statement Reconciliation
	 
	 	•	 	Copy of the Bank Statements
	 
	 	•	 	General Ledger Detail
	 
	 	•	 	Cash Receipts Journal
	 
	 	•	 	Cash Disbursements Journal
	 
	 	•	 	Diskette Template

     (3)  Leasing List

	 	•	 	Leasing Activity Report
	 
	 	•	 	Lease Expiration Report
	 
	 	•	 	Accounts receivable breakdown showing all monies past due by tenant on an
account aging basis.

     The Narrative Report provides an explanation of the activities that occurred in the previous
month and should address five main areas:

	 	•	 	Overall Performance of the Assets
	 
	 	•	 	Administrative Issues, Problems, and Events
	 
	 	•	 	Leasing Activities and Tenant Relations

10

 

	 	•	 	Building Operations
	 
	 	•	 	Construction and Tenant Improvement Activities

     (4) Diskette Template

     In addition to the foregoing hard copy reports, Proinvest will submit summary information to
the Owner on a computer diskette, formatted in Microsoft Excel or other formatted file template
satisfactory to Proinvest and the Owner which will allow the Owner to download Asset Budget and
general ledger account information.

     Owner shall have the right to make reasonable modifications or additions to the required
Monthly Report.

     5.8.
Operating Account; Deposit Account. Promptly after the date of this Agreement,
the Owner and Proinvest shall establish and maintain one or more interest bearing accounts) (the
“Operating Account”) in Owner’s name in Texas Capital Bank, N. A. or another bank or banks
reasonably acceptable to Owner, into which Proinvest shall cause to be deposited all rents,
revenues, receipts, loan payments, lease payments and all other payments, cash or income to the
extent actually received by Proinvest with respect to the Assets (collectively “Income”) of any
kind, type or nature which Proinvest receives and which emanate from or relate in any way to the
Assets. Unless otherwise required by any mortgagee or mortgagees of the Assets, Proinvest shall
set aside from such Income into escrow account(s) only the amounts reasonably estimated by
Proinvest to be necessary to pay real estate taxes or insurance premiums as required under this
Agreement, and any balance remaining shall be paid over to the Owner on Friday of each week by
wire transfer of immediately available funds or automated clearinghouse transfer. Promptly after
the date of this Agreement, the Owner and Proinvest shall establish and maintain one or more
interest-bearing account(s) (the “Deposit Account”) in Owner’s name at Texas Capital Bank, N.A. or
another bank or banks reasonably acceptable to Owner, into which Proinvest shall deposit all
amounts collected by Proinvest relating to a Disposition. The Owner shall pay from the Deposit
Account all expenses relating to the Disposition and to the extent provided in Article IX, shall
pay Proinvest any fees owing in respect of such Disposition prior to withdrawing funds therefrom
for its own account.

     5.9 Annual Certificates. Proinvest shall deliver to Owner within 15 days after the end
of each calendar year during the term of this Agreement a certificate signed by the Chief Operating
Officer and the Chief Financial Officer (if any) of Proinvest stating that this Agreement remains
in full force and effect, that Owner has performed its obligations under this Agreement, and that
Proinvest has performed all of its obligations under this Agreement in all material respects. Owner
shall deliver to Proinvest within fifteen (15) days after the end of each calendar year during the
term of this Agreement a certificate signed by the Chief Executive

11

 

Officer of the Owner stating that this Agreement remains in full force and effect, that, to his
actual knowledge, Proinvest has performed its obligations under this Agreement, and that, to his
actual knowledge, Owner has performed all of its obligations under this Agreement in all material
respects.

ARTICLE VI.

THIRD PARTY CONTRACTS

     6.1. Third-Party Agreements. Proinvest shall advise Owner as to the necessity or
desirability of entering into agreements, at Owner’s expense, with third parties (“Third Party
Contracts”) to perform the duties specified in Section 4.1, and other duties Proinvest reasonably
deems necessary, with respect to the Assets under this Agreement. Proinvest shall include in each
Asset Budget estimated costs determined by Proinvest for Third Party Contracts as to each Asset and
as to of each of the following services, and any such other services:

          (a) Legal Services;

          (b) Title Work;

          (c) Financial Investigation Services;

          (d) Commission Brokerage Services for Sales and Leasing;

          (e) Marketing Services;

          (f) Surveying Services;

          (g) Environmental Consulting Services;

          (h) Property Management Services;

          (i) Real
estate tax challenge counsel, consultants or other services;

          (j) Construction Services;

          (k) Architectural, Landscape Design, and Interior Design Fees;

12

 

          (l) Engineering Fees;

          (m) Promotional and Advertising Expenses;

          (n) Common
Area and Business Office Finish-Out, Furnishings, and Equipment;

          (o) Zoning Consultant Fees; and

          (p) Offsite Development Costs.

     6.2. Reimbursement of Third Party Costs. Owner shall deliver to Proinvest the amounts
necessary for Proinvest to make all payments which become due and payable for the costs of the
Third Party Contracts in accordance with the Asset Budget or otherwise approved by Owner provided
that Owner has received from Proinvest such original invoices and/or other documentation provided
by third parties as may be necessary to confirm services rendered and amounts due; such amounts
shall be paid or reimbursed by Owner within thirty (30) days of Owner’s receipt of such invoices
and documentation. The parties shall develop a mutually acceptable routine for payments so that
there is minimal disruption of their respective operations.

ARTICLE VII.

LEGAL REPRESENTATION

     Proinvest shall be authorized on Owner’s behalf, and at Owner’s expense, consistent with the
Owner’s Budget and the Owner’s Business Plan, to retain counsel to provide all legal services
required under this Agreement pertaining to the Assets. Proinvest shall promptly notify the Owner
of any and all litigation or claims made or threatened in writing against the Assets, the Owner
or, insofar as it relates to the Assets, Proinvest, in each case to the extent Proinvest actually
receives notice thereof. At the time Proinvest notifies the Owner of any such litigation or
claims, Proinvest shall also indicate whether Proinvest believes such matter is covered by an
insurance policy and whether notice of such matter has been given to an insurance company, and
what course of action Proinvest recommends to handle the claim.

ARTICLE VIII.

 PROINVEST’S COMPENSATION 

     8.1. Fees and Compensation. Proinvest shall be entitled to be paid the following fees and

13

 

other compensation, for so long as Proinvest shall remain the Manager and for so long as this
Agreement shall remain in effect. If this Agreement is terminated, but Proinvest remains the
Manager, Proinvest shall be entitled to continue to be paid the compensation set out in Section
8.1.2, but not the fees set out in Section 8.1.1. If Proinvest is removed, resigns or otherwise
ceases to serve as Manager, but this Agreement remains in effect, Proinvest shall be entitled to
continue to be paid the fees set out in Section 8.1.1, but not the compensation set out in Section
8.1.2.

     8.1.1.
Fees. (a) Property Advisory Fee. Proinvest shall be paid a Property
Advisory Fee in the amount of three and one-half percent (3.5%) times the gross Contract Purchase Price for each
Asset and three and one-half percent (3.5%) times the capitalized amount of any funds
used to develop, construct,
rehabilitate or improve Asset. The gross Contract Purchase Price shall include the stated purchase
price plus all other amounts paid by the Owner or for which the Owner is liable, including but not
limited to, debt secured by the Asset. The capitalized amount shall include all amounts
capitalized on the financial statements of the Owner in connection with any development,
construction or improvement of an Asset, including any capitalized costs for environmental
studies, inspections, zoning or re-zoning applications, structural or engineering studies and all
similar costs. The Property Advisory Fee shall be paid to Proinvest promptly upon the closing and
funding of the purchase of any Asset based upon the approved Asset Budget for that Asset.

          The total of all Acquisition Fees, including the Property Advisory Fees paid to Proinvest or
its affiliates, shall not at any time during the duration of the Owner exceed the compensation
customarily charged in arm’s-length transactions by others rendering similar services as an
ongoing public activity in the same geographic location and for comparable property.

     (b) Refinancing Fee. Proinvest shall be paid a Refinancing Fee in the amount of
seventy five basis points (0.75%) times the principal amount of any loan incurred to finance
or refinance an Asset, excluding any loan incurred in connection with the initial acquisition of
the Asset. The Refinancing Fee shall be paid to Proinvest promptly upon the closing and funding of
the loan.

     (c) Disposition Fee. Proinvest shall be paid a Disposition Fee in the amount of two
percent (2%) of the gross sales price or finance amount or capitalized lease amount [for any
long-term lease in excess of ten years] upon any Disposition of any Asset. The Disposition Fee
shall be paid to Proinvest promptly upon the closing and funding or other settlement of any
Disposition. A Disposition shall mean any sale, exchange, assignment, condemnation or other
governmental taking, financing or refinancing, lease financing or other long-term lease,
casualty or abandonment of or transfer of rights in or assignments of rights to or any similar
transaction

14

 

involving all or any part of any Asset, which transaction substantially terminates the Owner’s
ownership interest in the Asset. The term “Disposition” shall not include any such action by
another entity in which the Owner is a participant unless (i) the Owner determines that such
action constitutes a Disposition by the Owner, or (ii) such action substantially terminates the
Owner’s equity interest in such other entity or substantially eliminates any remaining value in
the equity interest in such other entity. The term “Disposition” shall be construed to include all
events or circumstances under which the members of the Owner might reasonably expect to receive a
return of all or part of their capital contribution. The Owner shall have discretion to determine
whether a particular transaction shall constitute a Disposition.

     (d) Management Fee. Proinvest shall be paid an annual Management Fee equal to the sum
of (1) not more than three-fourths of one percent (0.75%) of the
Base Amount of the Assets (other than cash held in bank accounts,
money market funds, or similar accounts, or accounts receivable) plus (2) not more than one-half of one
percent (0.5%) of cash of the Owner held in bank accounts, money market funds or similar accounts.
The base amount of the Assets is that portion of the capital
contributions of unit holders in Owner originally committed to
investment in the Assets, without regard to leverage but including
working capital reserves. The base amount of the Assets will be
recomputed annually by subtracting from the then fair market value of
the Assets, as determined by independent appraisals, and the working
capital reserves, an amount equal to the outstanding debt secured by
the Assets. The Management Fee will be payable on the tenth day of each month in an amount equal to one-twelfth
of the annual Management Fee, calculated as of the last day of the immediately preceding month.
Accrued but unpaid Management Fees for any period shall be deferred without interest and shall be
payable in subsequent periods from any funds available to the Owner after payment of all other
costs and expenses of the Owner (other than the Preferential Return), including any reserves then
determined by Proinvest to no longer be necessary to be retained by the Owner. If Proinvest is
terminated, Proinvest shall be paid Management Fees through the date of such termination.

     (f) Change in Compensation. The compensation of Proinvest may be changed from time to
time by a vote of the Investor Members holding not less than sixty seven percent (67%) of all
outstanding Units and of the Board of Managing Directors of the owner, as provided in the LLC
Agreement.

15

 

     8.1.2 Compensation. Proinvest shall be entitled to those allocations and
distributions provided to the Manager under the LLC Agreement. As provided in the LLC Agreement, the allocation
to Proinvest would be an allocation of twenty-five percent (25%) of net income, after Investor
Members have received allocations equal to all prior losses, the cumulative Preferential Return,
and all unreturned capital contributions. As provided in the LLC Agreement, the distributions to
Proinvest would include distributions of twenty-five percent (25%) of distributions after the
Investor Members have received distributions equal to the cumulative Preferential Return and all
unreturned capital contributions. Allocation and payment of such compensation shall in all respects
be subject to the provisions of the LLC Agreement, including without limitation provisions granting
the Board of Managing Directors discretion regarding allocations and distributions.

     8.2.
Expense Reimbursement. (a) Reimbursement of Acquisition Expenses.
Proinvest shall be reimbursed by the Owner for all Acquisition Expenses relating to Asset
acquisitions by the Owner which are paid by Proinvest rather than the Owner, such as legal fees,
travel expenses, title insurance premium expenses and other closing costs, in an amount not to
exceed one-half percent (.5%) of the Contract Purchase Price of each Asset. Proinvest shall be
reimbursed for all Acquisition Expenses related to properties that are not acquired by the Owner,
in the actual amount incurred, which expenses shall be accrued as incurred and submitted for
reimbursement by Proinvest to the Owner from time to time. In addition, the Owner shall bear the
expenses of independent appraisers, market analysts, zoning consultants, environmental
consultants, or other such persons not affiliated with Proinvest who may be engaged to evaluate
potential real estate acquisitions and developments by or on behalf of the Owner.

     (b) Other Expenses to be Reimbursed by Owner. Except as provided in this Section
8.2(b), all of the Owner’s expenses shall be billed directly to and paid by the Owner. The Owner
shall reimburse Proinvest and its affiliates for the actual cost to them of services, goods and
materials used for or by the Owner and obtained from entities unaffiliated with Proinvest.
Proinvest shall be reimbursed for the administrative services provided by Proinvest or its
affiliates and necessary to the prudent operation of the Owner; provided that the reimbursement
shall be at the lower of Proinvest’s actual cost or the amount the Owner would be required to pay
to independent parties for comparable administrative services in the same geographic location. No
payment or reimbursement will be made for services for which Proinvest is entitled to compensation
by way of a separate fee under Section 8.1. Excluded from allowable reimbursements shall be: (i)
rent or depreciation, utilities, capital equipment, or other administrative or overhead items of
Proinvest; and (ii) salaries, fringe benefits, tax withholding amounts, and other payroll
administrative items allocated to any controlling persons of Proinvest. A controlling person, for
purposes of this Section 8.2(b), shall be deemed to include, but not be limited to, any person,
whatever his title, who is a salaried employee of Proinvest and who performs functions for
Proinvest similar to those of a chairman or member of the Board of

16

 

Directors or of executive management, including Proinvest, President, Chief Operating Officer. Vice
President, Executive Vice President or Senior Vice President, Company Secretary and Treasurer. The
annual report to investors shall include a breakdown of the costs reimbursed to Proinvest pursuant
to this subsection. Within the scope of the annual audit of the Owner’s financial statements, the
independent certified public accountant shall verify the allocation of such costs to the Owner.

     (c) Expenses to be Paid by Proinvest. Proinvest or its affiliates shall pay, at no
additional cost to the Owner (i) rent or depreciation, utilities, capital equipment, or other
administrative or overhead items of Proinvest; (ii) salaries, fringe benefits, tax withholding
amounts, and other payroll administrative items allocated to any controlling persons of Proinvest;
and (iii) all other administrative expenses which are unrelated to the business of the Owner.
Proinvest or its affiliates shall pay, at no additional cost to the
Owner, Organization and
Offering Expenses, and other than commissions paid to broker-dealers and other underwriting
compensation and any trailing fees) to the extent such expenses exceed three percent (3.0%) of the
gross proceeds of the Offering.

     (d) Reimbursable Expenses to be Included in Budget. In connection with any request
for reimbursement, (i) Proinvest shall have included in the Asset Budget or the Owner’s Budget an
estimate of such reimbursable expenses, (ii) the reimbursement sought shall not exceed the amount
estimated in the Asset Budget or the Owner’s Budget, and (iii) together with the reasonably
anticipated reimbursable expenses which would be included in the same Asset Budget or Owner’s
Budget line item still to be incurred, the reimbursement is not reasonably anticipated to exceed
the amount estimated in the Asset Budget or the Owner’s Budget for the period covered thereby, or
provided that such expenses were incurred by Proinvest because they were required, based on
Proinvest’s good faith belief, to prevent imminent harm to persons or property. Except as provided
for in the LLC Agreement, Proinvest’s in-house expenses shall in no event be reimbursable
expenditures.

     (e) Time Reimbursement Due. Owner shall pay to Proinvest the amount of reimbursable
expenses incurred by Proinvest during the preceding calendar month that are reimbursable pursuant
to this Section 8.2 provided that Owner has received from Proinvest an itemized statement of such
reimbursable costs; such expenses shall be paid by Owner within thirty (30) days after Owner’s
receipt of such itemized statement.

ARTICLE IX.

OWNER’S DUTIES

     9.1. Designate Representative(s). On the date of this Agreement, and as
necessary

17

 

from time
to time thereafter, Owner shall designate in writing a representative with whom Proinvest
shall communicate, and provide notice as required under this Agreement, regarding all matters
pertaining to the Owner and the Assets. Such representative shall have authority to act on behalf
of Owner on any and all matters requiring action hereunder with regard to the Owner and the Assets.

     9.2. Furnish Asset files, Information and Cooperation with Proinvest. As of the date
of this Agreement or as soon thereafter as may be practicable. Owner shall provide to Proinvest
copies of all documents, correspondence, data, reports, information and items in its possession
pertaining to the Owner and the Assets. Owner shall thereafter furnish Proinvest information
required of Owner and otherwise provide cooperation and assistance to
Proinvest, to permit the
orderly performance of Proinvest’s duties under this Agreement.

     9.3. Compensate Proinvest. Owner shall timely compensate Proinvest for its services
under this Agreement in accordance with the provisions of this Agreement.

ARTICLE X.

INDEMNIFICATION

     10.1. Agreement to Indemnify.

          10.1.1. Proinvest’s Indemnity. Proinvest agrees to indemnify and hold harmless
the Owner and all of its officers, directors, shareholders, partners, affiliates, agents and
employees (collectively, “Owner Indemnitees”) against any and all actual or alleged claims,
losses, penalties, fines, forfeitures, judgments, reasonable attorneys’ fees and related
litigation costs, fees and expenses and amounts paid in settlement actually and reasonably incurred in
connection with any claim(s) against any Owner Indemnitee:

               (a) which result from any act or omission constituting gross negligence, bad faith or willful
misconduct by Proinvest or any officer, director, shareholder, partner, agent or employee of
Proinvest in connection with Proinvest’s performance under this Agreement; or

               (b) which result from any action taken by or on behalf of Proinvest relating to any Asset or
to the Owner which is a breach of any of Proinvest’s covenants or representations in this
Agreement.

          10.1.2. Owner’s Indemnity. Owner agrees to indemnify and hold harmless
Proinvest and all of its officers, directors, shareholders, members, managers, partners,
agents and

18

 

employees (collectively, “Proinvest Indemnitees “) against any and all actual or alleged claims,
losses, penalties, fines, forfeitures, judgments, reasonable attorneys’ fees and related litigation
costs, fees and expenses and amounts paid in settlement actually and reasonably incurred in
connection with third party claims against any Proinvest Indemnitee (collectively, “Losses”);

               (i) which result from any act or omission by or on behalf of Proinvest in connection with
Proinvest’s actions under this Agreement;

                    (A) unless such act or omission constitutes gross negligence, bad faith or willful
misconduct, in which event the Proinvest Indemnitees will not be indemnified under this Agreement;
or

                    (B) unless such act or omission is a breach of any of Proinvest’s covenants or representation
in this Agreement, in which event the Proinvest Indemnitees will not be indemnified under this
Agreement; or

                    (C) unless such Losses are covered by insurance, in which event the Proinvest Indemnitees
will be indemnified only to the extent of any deductible and any uninsured Losses, and provided
that the indemnity under this subparagraph (i) of Section 10.1.2 shall be void if Proinvest fails
to carry and/or maintain the insurance as required under this Agreement (unless such failure is
due to Owner’s failure to provide Proinvest with funds to pay the premium for the insurance after
Proinvest has requested such funds from Owner in writing); or

               (ii) which result from any act or omission constituting gross negligence, bad faith or
willful misconduct by an officer, director, member, manager, shareholder, partner, agent or
employee of the Owner in connection with this Agreement, unless Owner was acting on the
recommendation of Proinvest which was specifically given in writing and in giving such
recommendation Proinvest was acting with gross negligence, bad faith or willful misconduct, or
unless such Losses are covered by insurance, in which event the Proinvest Indemnitees will be
indemnified only to the extent of any deductible and any uninsured Losses, and provided that the
indemnity under this subparagraph (ii) of Section 10.1.2 shall be void if Proinvest fails to carry
and/or maintain the insurance as required under this Agreement (unless such failure is due to
Owner’s failure to provide Proinvest with funds to pay the premium for the insurance after
Proinvest has requested such funds from Owner in writing); or

               (iii) which arise under the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C.A.
§§ 9601 et seq. in connection with any Asset;

19

 

                    (A) unless such liability arises from an act or omission of Proinvest or those acting on its
behalf which constitutes gross negligence, bad faith or willful misconduct, in which event the
Proinvest Indemnitees will not be indemnified under this Agreement; or

                    (B) unless such Losses arise from Proinvest Indemnitees’ ownership or operation of the Assets
or acts and omissions by or on behalf of Proinvest in each case prior to the date of this
Agreement, in which event the Proinvest Indemnitees will not be indemnified under this Agreement;
or

                    (C) unless such losses are covered by insurance, in which event the Proinvest Indemnitees
will be indemnified only to the extent of any deductible and any uninsured Losses;

provided that the indemnity under this subparagraph (iii) of Section 10.1.2 shall be void if
Proinvest fails to carry and/or maintain the insurance as required under this Agreement (unless
such failure is due to Owner’s failure to provide Proinvest with funds to pay the premium for the
insurance after Proinvest has requested such funds from Owner in writing); or

               (iv) which arise solely from the fact of Proinvest’s status as a party to this Agreement, and
not from any act or omission of Proinvest or those acting on its
behalf, unless such losses are
covered by insurance, in which event the Proinvest Indemnitees will be indemnified only to the
extent of any deductible and any uninsured Losses, provided that the indemnity under this
subparagraph (iv) of Section 10.1.2 shall be void if Proinvest fails to carry and/or maintain the
insurance as required under this Agreement (unless such failure is due to owner’s failure to
provide Proinvest with funds to pay the premium for the insurance after Proinvest has requested
such funds from Owner in writing).

     10.2. Indemnity Procedures. If any claim shall be asserted, or any action, suit or
other proceeding shall be instituted, by a third party against (i) any Owner Indemnitee or (ii)
any Proinvest Indemnitee (each an “Indemnified Party”) with respect to any occurrence as
to which the other party (an “Indemnifying Party”) shall have any indemnity obligation under this
Agreement, such Indemnified Party shall promptly notify Indemnifying Party of the assertion of
such claim, action, suit or proceeding and shall tender the defense and, subject to the next
succeeding paragraph, settlement or compromise of any such claim, action, suit or proceeding to
Indemnifying Party for conduct thereof by Indemnifying Party. Indemnifying Party shall timely
commence and diligently continue such defense, settlement or compromise at Indemnifying Party’s
sole expense. Indemnifying Party shall have the right to select counsel, subject to Indemnified
Party’s prior written approval, which approval shall not be unreasonably withheld or delayed, for
such defense. Should any such claim, action, suit or proceeding result in a final and

20

 

unappealable judgment, Indemnifying Party shall promptly pay the same. Indemnified Party agrees to
cooperate with Indemnifying Party to the extent Indemnifying Party may reasonably request such
cooperation but at the sole expense of Indemnifying Party. Indemnifying Party shall succeed to and
have the benefit of all the defenses, claims and other rights of each Indemnified Party relating to
or affecting any obligation or liability of Indemnifying Party under this indemnity, and each
Indemnified Party agrees to fully disclose any and all such defenses, claims and other rights to
Indemnifying Party and upon request to promptly execute any documents and take any other action (at
the sole expense of the Indemnifying Party) necessary or desirable to further assure Indemnifying
Party the right to the benefit of such defenses, claims or other rights. Indemnified Party shall
have the right (but shall not have the obligation) upon notice to Indemnifying Party, at any time
and at its own cost and expense, to participate in the defense of any such claim, action, suit or
proceeding, to be represented by counsel of its choice (provided, however, that the Indemnifying
Party shall not be liable under this subparagraph for the fees and expenses of more than one set of
counsel for all Indemnified Parties unless a conflict of interest exists between or among
Indemnified Parties) and to assert in any such action, suit or proceeding any counterclaims or
cross claims Indemnified Party may have. In the event Indemnifying Party fails to timely commence
the defense, settlement or compromise thereof, Indemnified Party shall have the right (but shall
not have the obligation) upon notice to Indemnifying Party and failure of Indemnifying Party to
act, to defend, settle, compromise or take such other action as Indemnified Party shall deem
necessary in connection with any such claim, action, suit or proceeding and, in the event it is
determined that Indemnified Party was entitled to be indemnified under this Article X by
Indemnifying Party, shall have the right to be indemnified by Indemnifying Party for the entire
cost of defense, including attorneys’ fees and disbursements and experts’ fees and expenses
(including those incurred in connection with appellate proceedings). Notwithstanding the foregoing,
if any party making such claim, or any party to any such action, suit
or proceeding, shall take any
action to create or impose any lien or encumbrance on any of the assets of Indemnified Party in
respect of such claim, action, suit or proceeding or if any judgment shall be entered which would
result in Indemnified Party being obligated to pay the same, Indemnifying Party shall provide such
bond, deposit or take such other action as shall be required to prevent the creation or imposition
of any such lien, and to stay the execution of such judgment pending any appeal or other proceeding
prior to final entry thereof. Indemnifying Party shall have the right to settle or compromise any
such claim, action, suit or proceeding without the prior written consent of Indemnified Party
provided that, at the time of such settlement or compromise, Indemnifying Party shall satisfy and
discharge any and all liability of Indemnified Party resulting therefrom or shall post security
reasonably satisfactory to the Indemnified Party to assure the ultimate satisfaction and discharge
of such liability and provided that such settlement or compromise shall not require an admission of
liability or wrongdoing by Indemnified Party. Except as provided in the preceding sentence,
Indemnifying Party shall not settle or compromise any such claim, action, suit or proceeding
without the prior written consent of the Indemnified Party, which consent shall not be unreasonably
withheld or delayed. The failure or delay of

21

 

Indemnified Party to promptly notify Indemnifying Party of the institution of any claim, action,
suit or other proceeding shall not release or otherwise limit the indemnification obligation of
Indemnifying Party except to the extent that Indemnifying Party shall be prejudiced by the failure
or delay of Indemnified Party to give Indemnifying Party notice of such action, suit or proceeding.

     10.3. Recovery of Litigation Costs. In the event any dispute between the parties to
this Agreement shall result in litigation, arbitration or other proceeding, the court shall have
the discretion to award to the prevailing party all reasonable costs and expenses, including
without limitation reasonable attorneys’ fees and disbursements, incurred by the prevailing party
in connection with such litigation or other proceeding and any appeal thereof. Such costs,
expenses, fees and disbursements shall be included in and made a part of the judgment recovered by
the prevailing party, if any.

ARTICLE
XI

INSURANCE

     11.1. Fidelity Bond and Errors and Omissions Coverage.

          11.1.1 Fidelity Bond. Proinvest shall obtain and maintain at all times during the
term of this Agreement a blanket fidelity bond with a responsible company with broad coverage of
all officers, employees or other persons acting in any capacity with respect to the Assets or
handling funds, money, documents and papers relating to the Assets, in such amount as Proinvest
may reasonably determine to be appropriate. Any such fidelity bond shall insure and protect the
Owner, at a minimum, against losses, including, without limitation,
those arising from theft,
embezzlement and fraud. As soon as practicable after the date of this Agreement, Proinvest shall
cause to be delivered to the Owner a statement from the surety that such fidelity bond shall in no
event be terminated or materially modified without 30 days’ prior written notice to the Owner. The
Owner shall be notified of all draws or claims against the fidelity bond related to this
Agreement.

          11.1.2. Errors and Omissions. Proinvest shall obtain and maintain at all times during
the term of this Agreement an errors and omissions insurance policy with a responsible company
with broad coverage of all officers, employees or other persons acting in any capacity with
respect to the Assets or handling funds, money, documents and papers relating to the Assets. Any
such errors and omissions policy shall insure and protect the Owner, at a minimum, against losses,
including, without limitation, those arising from errors and omissions and negligent acts of such
persons or misplacement of funds, money, or documents. The protection against errors and omissions
shall be in the amount of at least $3,000,000. An soon as practicable after the date

22

 

of this Agreement, Proinvest shall cause to be delivered to the Owner a statement from the
insurance company that such policy shall in no event be terminated or materially modified without
30 days’ prior written notice to the Owner. The Owner shall be notified of all draws or claims
against the insurance policy related to this Agreement.

     11.2. Liability Insurance. Proinvest shall obtain and maintain at all times during the term of this Agreement comprehensive general liability, automobile liability, workers’
compensation and ether insurance to protect the interest of Proinvest in connection with the
performance of this Agreement. The Owner shall be designated as an additional insured under such
insurance policies. As soon as practicable after the date of this Agreement, Proinvest shall cause
to be delivered to the Owner a statement from the insurance company that such policy shall in no
event be terminated or materially modified without 30 days’ prior written notice to the Owner. The
Owner shall be notified of all draws or claims against the insurance policy related to this
Agreement.

     11.3 Notice of Cancellation. Proinvest agrees to notify Owner, or to cause Owner to be notified, in writing immediately, and in any event within five (5) days, of the notice
of cancellation or termination of any such coverage. Proinvest further agrees to notify the Owner
in writing within five (5) days of filing a claim related to this Agreement under such coverage.

     11.4.
Evidence of Insurance. On the effective date of this Agreement and annually thereafter, Proinvest shall provide to the Owner for approval copies of policies,
certificates of insurance or other proof evidencing its insurance coverage as required under this
Article XI.

ARTICLE XII.

TERMINATION OF AGREEMENT; PROCEDURES UPON

TERMINATION OR EXPIRATION OF AGREEMENT

     12.1. Termination. This Agreement may be terminated at any time upon the mutual
written agreement of Owner and Proinvest. Each party may terminate this Agreement by written
notice to the other party at any time following the occurrence of an Event of Default and the
failure to cure such Event of Default within the grace periods provided pursuant to Section 12.2.
As used herein, the term “Event of Default” shall mean the
occurrence of one or more of the followings

          (a) the failure by any party to pay or transfer monies when and as payment shall be
required pursuant to the terms of this Agreements

23

 

          (b) the failure by any party to perform any of its non-monetary obligations in accordance
with the terms of this Agreement;

          (c) the filing of a petition in bankruptcy or for an arrangement or for reorganization
pursuant to the Federal Bankruptcy Act or any similar law, Federal or state by any party, or the
adjudication by decree of a court of competent jurisdiction that any party is a bankrupt, or is
declared insolvent, or if any party shall make an assignment for the benefit of creditors, or shall
admit in writing its inability to pay its debts generally as they become due, or shall consent to
the appointment of a receiver or receivers of all or any part of its property; or

          (d) the filing of a petition in bankruptcy against any party or for reorganization of a party
to this Agreement pursuant to the Federal Bankruptcy Act or any similar law, federal or state, if
such petition shall not be discharged or dismissed within sixty (60) days after the date on which
such petition was filed; or

          (e) the termination or dissolution of either party.

     12.2 Notice of Default and Right to Cure. Upon the occurrence of an Event of Default,
the non-defaulting party shall provide the other party (the “Defaulting Party”) written notice
setting forth the nature of such Event of Default, and the Defaulting Party shall have thirty (30)
days to cure any Event of Default other than the failure of Proinvest to maintain insurance in
accordance with this Agreement, and Proinvest shall have ten (10) days to cure any failure to
maintain insurance in accordance with this Agreement, provided, however, that if the nature of the
Event of Default (other than the failure of Proinvest to maintain insurance in accordance with this
Agreement) is such that it cannot reasonably be cured within thirty (30) days, the Defaulting Party
may cure such Event of Default by commencing in good faith to cure the default promptly after its
receipt of such written notice and prosecuting the cure of such default to completion with
diligence and continuity within a reasonable time thereafter, but in any event within ninety (90)
days thereafter.

     12.3. Failure to Cure. If the Defaulting Party fails to cure the Event of Default
within the foregoing time periods, the other party may terminate this Agreement by written notice,
which termination shall be effective upon receipt of the notice or upon the date specified in the
notice.

     12.4 Termination by Proinvest. Proinvest may resign as Manager only after two years
following the effective date of the Registration Statement filed on behalf of the Owner with the
Securities and Exchange Commission; and only if it has identified a successor person to serve as
Manager, and such successor has been approved as successor Manager by a majority vote of the Board
after being given ninety (90) days notice. Any such resignation by Proinvest shall

24

 

automatically terminate this Agreement, effective as of the date of such resignation, unless
otherwise agreed in writing between Owner and Proinvest. Proinvest
may not otherwise resign,
withdraw from or terminate its service as Manager of the Owner.

     12.5 Payment to Withdrawn or Removed Manager. Upon the resignation, withdrawal or
removal of Proinvest as Manager or termination of this Agreement, the Owner shall be required to
pay Proinvest any amounts then accrued and owing to Proinvest under this Agreement. The method of
payment to Proinvest must be fair and must protect the solvency and liquidity of the Owner. In
addition, the Owner shall have the right, but not the obligation, to terminate Proinvest’s interest
in Owner’s income, losses, distributions and capital upon payment to Proinvest of an amount equal
to the value of its interest in Owner’s income, losses, distributions and capital on the date of
such resignation, withdrawal, removal or termination of this Agreement. Such interest shall be
computed taking into account Proinvest’s economic interest in the Owner under the LLC Agreement. In
the event Proinvest (or its representative) and the Owner cannot mutually agree upon such value
within ninety (90) days following such resignation, withdrawal, removal or termination, such value
shall be determined by arbitration before a panel of three appraisers, one of whom shall be
selected by Proinvest (or its representative) and one by the Owner, and the third of whom shall be
selected by the two appraisers so selected by the parties. Such arbitration shall take place in
Dallas, Texas and shall be in accordance with the rules and regulations of the American Arbitration
Association then in force and effect. The expense of arbitration shall be borne equally by
Proinvest and the Owner. Payment to Proinvest of the value of its interest in Owner’s income,
losses, distributions and capital shall be made, if the termination was voluntary, by the delivery
of an unsecured promissory note, bearing no interest and having principal payable, if at all, from
distributions which Proinvest would have otherwise received under this Agreement. Payment to
Proinvest of the value of its interest in Owner’s income, losses, distributions and capital shall
be made, if the termination was involuntary, at the option of Proinvest, by the delivery of a
promissory note, secured by a letter of credit issued by Texas Capital Bank, N.A. or other bank
acceptable to Proinvest, coming due in five years from the date of termination, and bearing
interest at the rate of interest most recently announced by Texas Capital Bank. N.A. as its “prime
rate” as of the date of the termination plus one percent (1%) per annum, with principal and
interest payable annually in equal installments.

     12.6. Termination of Executory Contracts. Upon the removal or occurrence of an Event
of Dissociation of Proinvest, this Agreement and all other executory contracts between the Owner
and Proinvest or any affiliate thereof (unless such affiliate is also an affiliate of any
remaining or new Manager) may be terminated and canceled by the Owner without prior notice or
penalty, excluding any executory contract or agreement regarding the compensation, rights to
indemnification or similar rights of Proinvest. Proinvest or any affiliate thereof (unless such
affiliate is also an affiliate of a remaining or new Manager or Manager) may also terminate and

25

 

cancel any such executory contract effective upon sixty (60) days prior written notice of such
termination and cancellation to the remaining or new Manager or Managers, if any, or to the Owner.
Upon the termination of this Agreement, Owner’s appointment of Proinvest as Manager shall
terminate, but the termination of this Agreement for any reason shall
not affect any right,
obligation or liability that has accrued under this Agreement, including specifically, but without
limitation Proinvest’s rights to fees and other compensation payable under this Agreement and the
LLC Agreement, except as provided herein and in the LLC Agreement.

     12.7. Procedures upon Expiration or Termination. Upon the expiration or termination
of this Agreement, Proinvest, as directed by Owner, either will immediately deliver all documents,
files, books, paper and accounts relating to the Assets (the “Records”) that are in Proinvest’s
possession or control to the control of Owner or will hold the Records for up to a twelve (12)
month period until Owner directs Proinvest to deliver the records. Proinvest may make and maintain
copies of the Records for its files.

     12.8. Duty of Cooperation. Upon the expiration or termination of this Agreement, the
parties will cooperate with each other to effect an efficient and smooth transition of
responsibility with respect to the Assets.

     12.9. Default Interest. If Owner shall fail to pay any Proinvest Fee within ten (10)
days following the receipt by Owner of notice of such failure, Owner shall pay interest to
Proinvest on the delinquent amount from the tenth day following the due date at an annual rate
equal to five (5) percentage points in excess of the prime rate of Texas Capital Bank, N.A. or
such other bank as shall hold the Operating Account, but in no event in excess of the highest rate
of interest permitted by applicable law.

     12.10. Late Payments. If the late payment by Proinvest of any expense payable by it
on Owner’s behalf shall result in Owner incurring late charges or default interest, Proinvest
shall itself pay if possible, or shall reimburse Owner promptly for the payment of, such charges
and interest unless such late payment is due to Owner’s failure to provide funds to Proinvest to
timely make such payments after being requested in writing by Proinvest to provide the funds
required.

ARTICLE XIII.

MISCELLANEOUS PROVISIONS

     13.1. No Partnership Intended. Nothing in this Agreement shall be deemed or construed
to create a co-partnership or joint venture between the parties hereto and Proinvest shall be an
independent contractor.

26

 

     13.2. Entire Agreement. This Agreement and the LLC Agreement together embody the
entire Agreement and understanding of the parties hereto in respect of the subject matter
contained herein. There are no restrictions, promises, representations, warranties, covenants or
undertakings other than those expressly set forth or referred to herein or in the LLC Agreement.
This Agreement and the LLC Agreement together supersede any and all prior agreements and
understandings between the parties with respect to such subject matter. In the event of conflict
between the terms of this Agreement and the LLC Agreement, the terms of the LLC Agreement shall
control.

     13.3. Amendment. This Agreement may only be amended in writing signed by both of the
parties.

     13.4. Counterparts. This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute one and the same
instrument.

     13.5. Benefit and Burden. This Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective successors and assigns; provided, however, that
neither party may assign this Agreement without the prior consent of the other party hereto except
to an Affiliate of the assigning party (which Affiliate shall expressly assume the obligations of
the assigning party), nor shall any controlling interest in either party hereto or any interests
aggregating during the term hereof into a controlling interest of either party hereto be sold,
transferred or assigned. Nothing herein shall limit the right of either party to transfer
interests which both alone and in the aggregate do not constitute a controlling interest.
Notwithstanding any provision to the contrary, Owner shall have the right to assign this Agreement
to a lender to secure Owner’s obligation to repay a loan from such lender to Owner, provided that
any such assignment shall provide that Proinvest shall not be required to perform any of its
obligations hereunder unless all of the obligations of the Owner have been and are being fully
performed in all material respects. Upon request, Proinvest shall provide to such lender such
assurances regarding this Agreement and the Assets as the lender shall reasonably request and
shall agree to such reasonable modifications to this Agreement as shall be requested by any such
lender, provided that such modifications do not affect the rights or obligations of Proinvest
under this Agreement in any material adverse respect and do not modify in any respect adverse to
Proinvest the provisions of this Agreement relating to the fees or reimbursements payable to
Proinvest.

     13.6. Notice. Any notice or other communication required or permitted to be given
hereunder shall be in writing, and shall be delivered personally, by telecopy (with a hard copy
and a transmission confirmation sent by a recognized overnight national carrier service (such as
Federal Express) for next business day delivery) or by recognized overnight national courier

27

 

service (such as Federal Express) for next business day delivery or shall be sent by certified or
registered mail, return receipt requested, first-class postage prepaid to the parties at the
addresses set forth below (or to such other addresses as the parties may specify by due notice to
the other):

	 	 	 
	If to Owner:

	 	Proinvest Realty Fund, LLC
	 

	 	8333 Douglas Avenue, Suite 1450
	 

	 	Dallas, Texas 75225
	 

	 	Attn: G. N. Olson, Chairman of the Board of Directors and
	 

	 	          Chief Executive Officer
	 

	 	Tel.: 214. 363.7130
	 

	 	Fax.: 214.363.9168
	 
	 	 
	If to Proinvest:

	 	Proinvest Realty Advisors, LLC
	 

	 	8333 Douglas Avenue, Suite 1450
	 

	 	Dallas, Texas 75225
	 

	 	Attn: T E Millard, Executive Vice President and
	 

	 	          Chief Operating Officer
	 

	 	Tel.: 214. 363.7130
	 

	 	Fax.: 214.363.9168

     Any notice delivered to a party’s designated address by (a) personal delivery, (b) recognized
overnight national courier service, or (c) registered or certified mail, return receipt requested,
shall be deemed to have been received by such party at the time the notice is delivered to such
party’s designated address. Confirmation by the courier delivering any notice given pursuant to
this Section shall be conclusive evidence of receipt of such notice. Each party hereby agrees that
it will not refuse or reject delivery of any notice given hereunder, that it will acknowledge, in
writing, receipt of the same upon request by any other party and that any notice rejected or
refused by it shall be deemed for all purposes of this Agreement to have been received by the
rejecting party on the date so refused or rejected, as conclusively established by the records of
the U.S. Postal Service or the courier service. Any notice required to be given within a stated
period of time which is sent by certified or registered mail shall be considered timely if
postmarked before midnight of the last day of such period.

     13.7. Separability. The invalidity or unenforceability of any provision of this
Agreement shall not impair the validity or enforceability of any other provision.

     13.8. Governing Law. This Agreement shall be governed by the laws of the State of
Texas.

     13.9. Headings. The headings in this Agreement are intended solely for convenience
of

28

 

reference and shall be given no effect in the construction or interpretation of this Agreement.

     13.10. No Waiver. No waiver shall be effective against either party unless it is in
writing, signed by that party. No waiver by either party of any breach of any term or covenant
contained in this Agreement shall operate as a waiver of such term or covenant itself, or of any
subsequent breach thereof.

     13.11. Affiliate. For purpose of this Agreement, the term “Affiliate” means any
corporation, partnership, joint venture, trust or other entity (collectively, a “Person”) or group
of persons acting in concert in respect of the Person in question that, directly or indirectly,
through one or more intermediaries, controls or is controlled by or is under common control with
such Person. For the purposes of this definition, “control” (including, with correlative meanings,
the terms “controlled by” and “under common control with”), as used with respect to any Person or
group of Persons, shall mean possession, directly or indirectly, through one or more
intermediaries, of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities or by contract or otherwise.

     13.12. Authorization. Proinvest hereby represents and warrants to Owner that
Proinvest has full power and authority to execute, deliver and perform its obligations under this
Agreement and that this Agreement has been duly executed and delivered by Proinvest. Owner hereby
represents and warrants to Proinvest that Owner has full power and authority to execute, deliver
and perform its obligations under this Agreement and that this Agreement has been duly executed
and delivered by Owner.

     13.13. Limitation of Recourse. There shall be no liability under this Agreement of,
nor any recourse under this Agreement to, any officer, director, shareholder, member, manager,
affiliate, employee or agent of either party to this Agreement.

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above.

[The signatures appear on the next page.]

29

 

	 	 	 	 	 
	 	PROINVEST REALTY FUND, LLC

A Delaware Limited Liability Company

 	 
	 	By:  	PROINVEST REALTY ADVISORS, LLC
 	 
	 	 	a Texas Limited Liability Company 	 
	 	 	 	 
	 	By:  	                        /s/ G. N. Olson
 	 
	 	 	G. N. Olson, Chairman of the Board of Managing 	 
	 	 	Directors and Chief Executive Officer 	 
	 

	 	 	 	 	 
	 	PROINVEST REALTY ADVISORS, LLC

A Texas Limited Liability Company

 	 
	 	By:  	/s/ T E Millard
 	 
	 	 	T E Millard, Executive Vice President and 	 
	 	 	Chief Operating Officer 	 
	 

30exv10w1

 

Exhibit 10.1

      

EMPLOYMENT AGREEMENT

by and between

ODYSSEY HEALTHCARE, INC.

and

FRANK ANASTASIO

dated March 17, 2008 to be effective as of

March 1, 2008

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	1.	 	Certain Definitions	 	 	1	 
	 
	 	 	 	 	 	 	 	 
	2.	 	Term of Employment; Non-Renewal of Term	 	 	5	 
	 
	 	 	 	 	 	 	 	 
	3.	 	Terms of Employment	 	 	5	 
	 
	 	(a)	 	Position and Duties	 	 	5	 
	 
	 	(b)	 	Compensation	 	 	6	 
	 
	 	 	 	 	 	 	 	 
	4.	 	Termination of Employment	 	 	7	 
	 
	 	(a)	 	Death	 	 	7	 
	 
	 	(b)	 	Disability	 	 	7	 
	 
	 	(c)	 	Cause	 	 	8	 
	 
	 	(d)	 	Resignation by Employee	 	 	8	 
	 
	 	(e)	 	Agreement Not to Terminate	 	 	8	 
	 
	 	 	 	 	 	 	 	 
	5.	 	Compensation Upon Termination Prior to a Change in Control
of the Company and After the Second Anniversary of such
Change in Control	 	 	8	 
	 
	 	(a)	 	Death or Disability	 	 	8	 
	 
	 	(b)	 	For Cause; Resignation by Employee
Without Good Reason; Non-Renewal Election by Employee or the Company	 	 	9	 
	 
	 	(c)	 	Without Cause; Resignation by Employee for Good Reason	 	 	9	 
	 
	 	 	 	 	 	 	 	 
	6.	 	Compensation Upon Employment Termination Occurring On or Within Two Years After a Change in Control of the Company	 	 	11	 
	 
	 	(a)	 	Compensation Upon Termination	 	 	11	 
	 
	 	 	 	 	 	 	 	 
	7.	 	Other Provisions Relating to Termination	 	 	12	 
	 
	 	(a)	 	Notice of Termination	 	 	12	 
	 
	 	(b)	 	Date of Termination	 	 	13	 
	 
	 	(c)	 	Good Reason	 	 	13	 
	 
	 	(d)	 	Cause	 	 	13	 
	 
	 	(e)	 	Full Settlement; Mitigation	 	 	14	 
	 
	 	(f)	 	Release and Other Agreements	 	 	14	 
	 
	 	 	 	 	 	 	 	 
	8.	 	Disclosure of, Access to and Entrustment of Confidential Information, Business Opportunities and
Business Goodwill	 	 	15	 
	 
	 	 	 	 	 	 	 	 
	9.	 	Confidential Information; Ownership of Property	 	 	15	 
	 
	 	(a)	 	Obligations to Maintain Confidentiality	 	 	15	 
	 
	 	(b)	 	Ownership of Work Product	 	 	17	 
	 
	 	 	 	 	 	 	 	 
	10.	 	Non-Competition; Non-Solicitation; Non-Disparagement	 	 	17	 
	 
	 	 	 	 	 	 	 	 
	11.	 	Successors; Binding Agreement	 	 	19	 
	 
	 	 	 	 	 	 	 	 
	12.	 	Effect of Agreement on Plans and Agreements Governing Awards	 	 	19	 
	 
	 	 	 	 	 	 	 	 
	13.	 	Miscellaneous	 	 	20	 
	 
	 	(a)	 	Construction	 	 	20	 
	 
	 	(b)	 	Notices	 	 	20	 

 i

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	 
	 	(c)	 	Severability	 	 	20	 
	 
	 	(d)	 	Withholding	 	 	21	 
	 
	 	(e)	 	No Waiver	 	 	21	 
	 
	 	(f)	 	Equitable and Other Relief	 	 	21	 
	 
	 	(g)	 	Entire Agreement	 	 	21	 
	 
	 	(h)	 	Arbitration	 	 	21	 
	 
	 	(i)	 	Attorney Fees	 	 	22	 
	 
	 	(j)	 	Survival	 	 	22	 
	 
	 	(k)	 	Governing Law	 	 	22	 
	 
	 	(l)	 	Amendments	 	 	22	 
	 
	 	(m)	 	Employee Acknowledgement	 	 	22	 
	 
	 	(n)	 	Counterparts	 	 	22	 

 ii

 

 

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into on March 17,
2008 to be effective as of March 1, 2008 (the “Effective Date”), by and between Odyssey
HealthCare, Inc., a Delaware corporation (the “Company”), and Frank Anastasio
(“Employee”).

RECITALS:

     A. The Company is a national provider of hospice services and desires to employ Employee as
the Senior Vice President — Sales and Marketing of the Company.

     B. The Company considers the establishment and maintenance of a sound and vital management
group to be essential to protecting and enhancing its best interests and the best interests of its
stockholders.

     C. In order to induce Employee to accept employment by the Company as an officer of the
Company and its Subsidiaries (as defined in Section 1(o) below), the Company is willing to
agree to provide certain severance benefits to Employee in the event that Employee’s employment is
terminated or changed under the circumstances described in this Agreement.

     D. Employee is currently employed by the Company as a regional vice president of the Company
and Employee is desirous of committing himself to serve the Company and its Subsidiaries in the new
position of Senior Vice President — Sales and Marketing on the terms herein provided.

AGREEMENTS:

     NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements
contained herein, and other good and valuable consideration, the sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

     1. Certain Definitions. As used in this Agreement, the following terms have the meanings set forth below:

          (a) “Acquiring Person” means any Person or group of related Persons (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) other than (i) Employee or any
Employee Affiliate, or (ii) the Company, any of the Company’s Subsidiaries, any employee benefit
plan of the Company or of a Subsidiary of the Company or of a corporation owned directly or
indirectly by the stockholders of the Company in substantially the same proportions as their
ownership of stock of the Company, or any trustee or other fiduciary holding securities under an
employee benefit plan of the Company or of a Subsidiary of the Company or of a corporation owned
directly or indirectly by the stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company.

          (b) “Affiliate” means, with respect to any Person, any other Person that directly or
indirectly controls, is controlled by, or is under common control with the Person in

1

 

question. As
used in this definition of “Affiliate,” the term “control” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and policies of a
Person, whether through ownership of Voting Securities, by contract, or otherwise.

          (c) “Board” means the Board of Directors of the Company and any committee thereof.

          (d) “Cause” means Employee’s

               (i) continued failure to substantially perform Employee’s obligations and duties under
Section 3(a) (other than as a result of physical or mental incapacity), as reasonably
determined by the Board, and which is not remedied within 30 days after receipt of written notice
from the Company specifically identifying the manner in which the Company believes that Employee
has not substantially performed Employee’s obligations and duties under Section 3(a);

               (ii) commission of an act of fraud, embezzlement, misappropriation, willful misconduct, bad
faith, dishonesty, breach of trust, or breach of fiduciary duty against the Company or other
conduct materially harmful or potentially materially harmful to the Company’s interest, as
reasonably determined by the Board after a hearing by the Board following 10 days’ prior written
notice to Employee of such hearing;

               (iii) material breach of Sections 8, 9 or 10;

               (iv) conviction, plea of no contest or nolo contendere, deferred adjudication or unadjudicated
probation for any felony or any crime involving moral turpitude;

               (v) failure to carry out, or comply with, in any material respect, any lawful directive of the
Board or the Reporting Officer (as defined in Section 3(a)) consistent with the terms of
this Agreement, which is not remedied within 30 days after receipt of written notice from the
Company specifying such failure;

               (vi) violation of the Company’s substance abuse policy; or

               (vii) suspension or termination of Employee from the Medicare or Medicaid programs.

The Company may suspend Employee’s title and authority pending the hearing provided for in clause
(ii) above and any such suspension shall not be deemed “Good Reason.”

          (e) “Change in Control” means the occurrence of any of the following events:

               (i) any of the events described in clauses (ii), (iii) and (iv) of the definition of
“Change in Control” in the Odyssey HealthCare, Inc. 2001 Equity-Based Compensation Plan; or

               (ii) any Acquiring Person is or becomes the “beneficial owner” (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the

2

 

Company representing fifty percent
or more of the combined voting power of the then outstanding Voting Securities of the Company.

          (f) “Competing Business” means a business that competes in any material respect with
the business engaged in by the Company or any of its Subsidiaries, (A) at the time in question in
respect of the Term of Non-Competition (as defined in Section 1(p)) occurring prior to the
Date of Termination and (B) as of the Date of Termination (as defined in Section 7(b)) in
respect of the Term of Non-Competition occurring on and after the Date of Termination.

          (g) “Competing Services” means services that, if provided to a business other than a
Competing Business, would constitute the conduct of a Competing Business.

          (h) “Disability” means Employee’s inability to perform, with or without reasonable
accommodations, the essential functions of Employee’s position hereunder for a period of 180
consecutive days due to mental or physical incapacity, as determined by mutual agreement of a
physician selected by the Company or its insurers and a physician selected by Employee; provided,
however, that if the opinion of the Company’s physician and Employee’s physician conflict, the
Company’s physician and Employee’s physician shall together agree upon a third physician, whose
opinion shall be binding. The foregoing definition of “Disability” is not intended to and shall
not affect the definition of “disability” or any similar term in any insurance policy the Company
or any of its Subsidiaries may provide.

          (i) “Employee Affiliate” means any Person directly or indirectly controlled by
Employee. For purposes of this Agreement, a Person shall be presumed to be controlled by Employee
if (i) Employee is a director or general partner of such Person (including any partnership in which
Employee is a general partner or any trust in which Employee is a trustee or beneficiary), (ii)
Employee directly or indirectly beneficially owns 10% or more of the outstanding Voting Securities
of such Person or (iii) such Person is controlled by any Person contemplated in clauses (i) or (ii)
of this definition.

          (j) “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

          (k) “Geographic Area” means each city (including the 50-mile radius surrounding such
city) in which the Company or any of its Subsidiaries has a facility that engages in its respective
business or any line of its business (A) at the time in question in respect of the Term of
Non-Competition occurring prior to the Date of Termination and (B) as of the Date of Termination in
respect of the Term of Non-Competition occurring on and after the Date of Termination.

          (l) “Good Reason” means, subject to the terms and provisions of this Agreement
(including Sections 1(d) and 4(b)), the occurrence of one or more of the following
events:

               (i) any removal of Employee from the office of Senior Vice President — Sales and Marketing of
the Company; provided, however, that Good Reason may not be asserted by Employee under this clause (i) if one of the following events occur: (A) Employee
is removed from the office of Senior Vice President — Sales and Marketing and offered a regional

3

 

vice president role with the Company, or (B) after a Non-Renewal Notice has been given by either
the Company or Employee;

               (ii) any termination or material reduction of a material benefit under any Investment Plan or
Welfare Plan in which Employee participates unless (A) there is substituted a comparable benefit
that is economically substantially equivalent to the terminated or reduced benefit prior to such
termination or reduction or (B) benefits under such Investment Plan or Welfare Plan are terminated
or reduced with respect to all employees previously granted benefits thereunder;

               (iii) any reduction in Employee’s Annual Base Salary;

               (iv) any failure by the Company to comply with any of the provisions of Section
3(b), which failure is not contemplated previously within this definition;

               (v) any failure by the Company to comply with Section 11(c); or

               (vi) without limiting the generality of the foregoing, any material breach by the Company or
any of its Subsidiaries or other Affiliates of (A) this Agreement or (B) any other agreement
between Employee and the Company or any such Subsidiary or other Affiliate,

excluding, in the case of clauses (i) through (vi), any isolated, insubstantial and inadvertent
failure not occurring in bad faith and which is remedied by the Company promptly after receipt of
notice thereof given by Employee.

          (m) “Person” means any individual, partnership, limited liability partnership, joint
venture, corporation, limited liability company, trust, association, or other entity or
organization.

          (n) “Pro Rata Bonus” means the amount equal to the product of (i) the amount of the
Annual Bonus (as defined in Section 3(b)(ii)), if any, to which Employee would have been
entitled for the calendar year in which Employee’s Date of Termination occurs if Employee’s
employment were not terminated during such calendar year, multiplied by (ii) a fraction,
the numerator of which is the number of days that have elapsed since the beginning of such calendar
year through (but not including) Employee’s Date of Termination, and the denominator of which is
the total number of days in such calendar year. The amount, if any, of the Annual Bonus to which
Employee would have been entitled for the calendar year in which the Date of Termination occurs
shall be determined by the Board in its sole good faith discretion; provided, however, that during
the period on or within two years after a Change in Control, for purposes of determining the amount
of the Pro Rata Bonus, Employee shall be deemed to have been entitled to an Annual Bonus of not
less than the amount of the last Annual Bonus awarded to Employee prior to such Change in Control.

          (o) “Subsidiary” means, with respect to any Person, any corporation or other entity of
which a majority of the voting power of the voting equity securities or equity interest is owned,
directly or indirectly, by that Person.

4

 

          (p) “Term of Non-Competition” means the period of time beginning on the Effective Date
and continuing until 5:00 p.m., Dallas, Texas time, on the first anniversary of the Date of
Termination.

          (q) “Voting Securities” means any securities that vote generally in the election of
directors, in the admission of general partners, or in the selection of any other similar governing
body.

          (r) “without Cause” means a termination by the Company of Employee’s employment during
the Term at the Company’s sole discretion for any reason other than a termination based upon Cause,
death or Disability; provided that, “without Cause” does not include (A) a termination of this
Agreement by the Company following Employee’s removal from the office of Senior Vice President —
Sales and Marketing and Employee’ acceptance or refusal to accept the position of regional vice
president of the Company or (B) termination of this Agreement and Employee’s employment pursuant to
Section 2.

     2. Term of Employment; Non-Renewal of Term. Subject to the terms and provisions of this Agreement, the Company hereby agrees to employ
Employee, and Employee hereby agrees to be employed by the Company, for the period (the
“Term”) commencing on the Effective Date and, unless Employee’s employment hereunder is
sooner terminated in accordance with the terms hereof, expiring at 5:00 p.m., Dallas Texas time, on
February 28, 2009; provided, however, that commencing on December 31, 2008 (the Employment
Expiration Date”), and on each February 28 occurring thereafter, the Term shall automatically
(without any action by either party) be extended for one additional calendar year unless, at least
90 days prior to the expiration of the Term, the Company or Employee shall have given written
notice (a “Non-Renewal Notice”) that it or Employee, as applicable, does not wish to extend
this Agreement (a “Non-Renewal”). Either party may elect not to renew this Agreement. The
term “Term,” as utilized in this Agreement, shall refer to the Term as so automatically extended.
The Term shall expire as a result of any Non-Renewal at 5:00 p.m., Dallas, Texas time, on the
February 28 of the extension period during which a Non-Renewal Notice is given, and Employee’s
employment shall terminate at the expiration of the Term.

     3. Terms of Employment.

     (a) Position and Duties.

               (i) During the Term, Employee shall serve as Senior Vice President — Sales and Marketing of
the Company. In so doing, Employee shall have such powers and duties (including holding officer
positions with one or more Subsidiaries of the Company) as may be assigned from time to time by the Board, so long as such powers and duties are reasonable and
customary for a senior vice president — sales and marketing of an enterprise comparable to the
Company. Employee shall report to the Chief Operating Officer of the Company or to such other
executive officer of the Company as the Board may from time to time determine after the date hereof
(the “Reporting Officer”).

               (ii) During the Term, and excluding any periods of vacation and sick leave to which Employee
is entitled, Employee agrees to devote all of Employee’s business time

5

 

to the business and affairs
of the Company and, to the extent necessary to discharge the responsibilities assigned to Employee
hereunder, to (a) use Employee’s best efforts to perform diligently, faithfully, effectively and
efficiently such responsibilities, (b) use Employee’s best efforts to promote the interests of the
Company; (c) use Employee’s best efforts to maintain Employer’s status as a participating provider
under the Medicare and Medicaid programs; and (d) perform such other duties appropriate for
Employee’s position as the Board or the Reporting Officer may from time to time reasonably direct.

               (iii) Employee shall not engage, directly or indirectly, in any other business, investment, or
activity that interferes with the performance of Employee’s duties under this Agreement, is
contrary to the interests of the Company or requires any portion of Employee’s business time;
provided, however, that during the Term, it shall not be a violation of this Agreement for Employee
to (1) serve on the board of directors (or similar governing body) of one or more other companies
that do not engage in a Competing Business if the Board has provided prior approval (which shall
not be unreasonably withheld) for such service, (2) serve on corporate, civic, charitable or
industry sector association boards or committees, (3) deliver lectures or fulfill speaking
engagements and (4) manage personal investments, so long as such activities do not materially
interfere with the performance of Employee’s responsibilities as an employee of the Company in
accordance with this Agreement.

     (b) Compensation.

               (i) Annual Base Salary. During the Term, Employee shall receive an annual base salary
(“Annual Base Salary”), which shall be paid bi-weekly in accordance with the customary
payroll practices for executive officers of the Company, in an amount at least equal to $200,000.00
per year. At least annually (by no later than March 31 of each year) during the Term, the Board
shall review the Annual Base Salary of Employee and may increase (but not decrease) the Annual Base
Salary by such amount as the Board shall deem appropriate, subject to Employee’s rights under
Section 1(l)(iii). The term “Annual Base Salary” as used in this Agreement shall refer to
the Annual Base Salary as it may be so increased.

               (ii) Annual Bonus. During the Term, Employee shall be eligible to receive, in
addition to the Annual Base Salary, such annual bonus payments as the Board may specify in its sole
discretion (each, an “Annual Bonus”). Annually (by no later than March 15 of each calendar
year during the Term), the Board shall determine the amount (or amount range) of the Annual Bonus
that Employee shall be eligible to receive for the calendar year and the performance goals that
must be achieved for Employee to become entitled to receive the Annual Bonus for such calendar year. For each calendar year (or partial calendar year) during the
Term, the Board shall determine in its sole good faith discretion whether the performance goals
established for Employee for such calendar year have been achieved, such determination to be made
by no later than the date on which the Company publicly announces its earnings for such calendar
year in a press release in the immediately following calendar year. Subject to the terms hereof,
any Annual Bonus that Employee becomes entitled to receive shall be payable to Employee within
fifteen days after such determination by the Board.

               (iii) Incentive, Savings, Stock Option and Retirement Plans. During the Term,
Employee shall be entitled to participate in all incentive, savings, stock option, equity-

6

 

based,
profit sharing and retirement plans, practices, policies and programs applicable generally to other
executives of the Company (“Investment Plans”), subject to all of the terms and conditions
of such Investment Plans.

               (iv) Welfare Benefit Plans. During the Term, Employee and/or Employee’s family, as
the case may be, shall be eligible for participation in and shall receive all benefits under the
welfare benefit plans, practices, policies and programs (“Welfare Plans”) provided by the
Company (including, without limitation, medical, prescription, dental, short-term and long-term
disability, salary continuance, employee life, group life, accidental death and travel accident
insurance plans and programs) to the extent applicable generally to other executives of the
Company, subject to all of the terms and conditions of such Welfare Plans.

               (v) Perquisites. During the Term, Employee shall be entitled to receive (in addition
to the benefits described above) such perquisites and fringe benefits appertaining to Employee’s
position in accordance with any policies, practices, and procedures established by the Board.

               (vi) Expenses. During the Term, Employee shall be entitled to receive prompt
reimbursement for all reasonable business-related expenses incurred by Employee in the performance
of Employee’s duties in accordance with the Company’s policies, practices and procedures.

               (vii) Vacation and Holidays. During the Term, Employee shall be entitled to paid
vacation, in accordance with the plans, policies, programs and practices of the Company for its
executive officers. In addition, Employee shall be entitled to sick leave and paid holidays, in
accordance with the plans, policies, programs and practices of the Company for its Employee
officers.

               (viii) Proration. Any payments or benefits payable to Employee hereunder in respect
of any calendar year during which Employee is employed by the Company for less than the entire
year, unless otherwise provided in the applicable plan or arrangement, shall be prorated in
accordance with the number of days in such calendar year during which Employee is so employed.

     4. Termination of Employment.

     (a) Death. Employee’s employment hereunder shall terminate automatically upon Employee’s death during the
Term.

     (b) Disability. If the Disability of Employee has occurred during the Term, the Company may give to Employee a
written Notice of Termination (as defined in Section 7(a)) in accordance with Section
7(a) of its intention to terminate Employee’s employment hereunder. In such event, Employee’s
employment shall terminate effective on the 30th day after receipt of such notice by Employee (the
“Disability Effective Date”); provided that, within 30 days after receipt of the Notice of
Termination, Employee shall not have returned to perform, with or without reasonable
accommodations, the essential functions of Employee’s position on a full-time basis. During any
period of Employee’s Disability, the Company may assign Employee’s duties to any other Employee of
the Company or may engage or hire a third party to perform

7

 

such duties and any such action shall
not be deemed “Good Reason” for Employee to terminate this Agreement pursuant to Section
4(d)(i).

     (c) Cause. Subject to Section 7(d), the Company may terminate Employee’s employment at any time
during the Term for Cause or without Cause. The Company may suspend Employee’s title and
authority, with pay, pending the hearing provided for in the definition of “Cause” in Section
1(d)(ii), and such suspension shall not be deemed “Good Reason” for Employee to terminate this
Agreement pursuant to Section 4(d)(i).

     (d) Resignation by Employee. At Employee’s option, Employee may terminate Employee’s employment hereunder (i) subject to
Section 7(c), for Good Reason or (ii) without Good Reason.

     (e) Agreement Not to Terminate. Notwithstanding any provision to the contrary contained in this Agreement, the Company agrees
that it shall not have the right to terminate Employee’s employment, other than for Cause, for a
period of time commencing on the Effective Date and ending at 5:00 p.m., Dallas, Texas time, on the
180th day following the Effective Date.

     (f) Reassignment of Employee. This Agreement shall automatically terminate upon the
effective date of (i) Employee’s reassignment to the position of regional vice president of the
Company or (ii) Employee’s refusal to accept such reassignment to the position of regional vice
president of the Company. In the event Employee refuses to accept the position of regional vice
president of the Company following his removal as Senior Vice President — Sales and Marketing,
Employee shall be deemed to have resigned without Good Reason.

     5. Compensation Upon Termination Prior to a Change in Control of the Company and After the
Second Anniversary of such Change in Control. Prior to the occurrence of a Change in Control of the Company and after the second anniversary
of such Change in Control of the Company, conditioned on the effectiveness of a Release (as defined
in Section 7(f)) signed by Employee or Employee’s legal representative pursuant to
Section 7(f), Employee shall, subject to the provisions of Section 7(g), be
entitled to the following compensation from the Company upon the termination of Employee’s
employment during the Term, which shall be in lieu of any other severance pay or employment
benefits to which Employee might otherwise be entitled (whether contractual or under a severance
plan, the WARN Act, any other applicable law, or otherwise):

     (a) Death or Disability. If Employee’s employment is terminated by reason of Employee’s death or Disability, the Company
shall pay to Employee or Employee’s legal representatives (i) within 60 days after the Employee’s
Date of Termination, a lump sum in cash equal to the sum of Employee’s Annual Base Salary through
the Date of Termination to the extent not previously paid and any compensation previously deferred
by Employee (together with any accrued interest or earnings thereon) (the “Accrued
Obligations”); (ii) the amount of any Annual Bonus to which Employee was entitled for the
calendar year ending prior to the Date of Termination to the extent not previously paid, which
amount shall be paid at such time as the Company pays other executives of the Company annual
bonuses for the prior calendar year (but in no event later than the fifth business day after the
Company publicly announces its earnings for such calendar year in a press release); (iii) without
duplication of any amount payable

8

 

pursuant to clause (ii) above, the amount of any Pro Rata Bonus,
which shall be paid at such time as the Company pays the other executives of the Company annual
bonuses for the calendar year in which Employee’s Date of Termination occurs (but in no event later
than the fifth business day after the Company publicly announces its earnings for such calendar
year in a press release); (iv) any amounts arising from Employee’s participation in, or benefits
under, any Investment Plan (the “Accrued Investments”), which amounts shall be paid in
accordance with the terms and conditions of such Investment Plan; and (v) any amounts to which
Employee or Employee’s spouse, beneficiaries or estate are entitled from Employee’s participation
in, or benefits under, any Welfare Plan (“Accrued Welfare Benefits”), which amounts shall
be paid in accordance with the terms and conditions of such Welfare Plan. Except as described in
this Section 5(a), in the event of Employee’s termination by reason of Employee’s death or
Disability, Employee and Employee’s legal representatives, as applicable, shall forfeit all rights
to any other compensation.

     (b) For Cause; Resignation by Employee Without Good Reason; Non-Renewal Election by
Employee or the Company. If the Company shall terminate Employee’s employment for Cause or Employee resigns without Good
Reason or Employee’s employment is terminated due to a Non-Renewal election by Employee or the
Company, the Company shall have no further obligations to Employee other than the obligation for
payment of:

               (i) the Accrued Obligations, which shall be payable within 60 days after the Employee’s Date
of Termination;

               (ii) the amount of any Annual Bonus to which Employee was entitled for the calendar year
ending prior to the Date of Termination to the extent not previously paid, which amount shall be
payable at such time as the Company pays other executive of the Company annual bonuses for the
prior calendar year (but in no event later than the fifth business day after the Company publicly
announces its earnings for such calendar year in a press release);

               (iii) the Accrued Investments, which amounts shall be paid in accordance with the terms and
conditions of the Investment Plans;

               (iv) the Accrued Welfare Benefits, which amounts shall be paid in accordance with the terms
and conditions of the Welfare Plans; and

               (v) without duplication of any amount payable pursuant to clause (ii) above, solely in the
case of a Non-Renewal by Employee or the Company, the amount of any Pro Rata Bonus, which shall be
paid at such time as the Company pays the other executives of the Company annual bonuses for the
calendar year in which Employee’s Date of Termination occurs (but in no event later than the fifth
business day after the Company publicly announces its earnings for such calendar year in a press
release).

     Except as described in this Section 5(b), in the event of Employee’s termination by
the Company for Cause or by Employee without Good Reason or due to a Non-Renewal election by
Employee or the Company, Employee shall forfeit all rights to any other compensation.

     (c) Without Cause; Resignation by Employee for Good Reason. If the Company shall terminate Employee’s employment without Cause (other than by reason of
Employee’s

9

 

death or Disability or a Non-Renewal by Employee) or Employee resigns for Good Reason,
then the Company shall pay or provide Employee:

               (i) within 60 days after the Employee’s Date of Termination, a lump sum in cash equal to the
aggregate of the following amounts: (A) the Accrued Obligations and (B) the amount of any Annual
Bonus to which Employee was entitled for the calendar year ending prior to the Date of Termination
to the extent not previously paid;

               (ii) without duplication of any amount payable pursuant to clause (i)(B) above, the amount of
any Pro Rata Bonus, which shall be paid at such time as the Company pays the other executives of
the Company annual bonuses for the calendar year in which Employee’s Date of Termination occurs
(but in no event later than the fifth business day after the Company publicly announces its
earnings for such calendar year in a press release);

               (iii) the Accrued Investments, which amounts shall be paid in accordance with the terms and
conditions of the Investment Plans;

               (iv) the Accrued Welfare Benefits, which amounts shall be paid in accordance with the terms
and conditions of the Welfare Plans;

               (v) the amount of Employee’s Annual Base Salary as of the Date of Termination, which amount
shall be paid in bi-weekly payments, in accordance with the customary payroll practices of the Company, for the period from the Date of Termination
through the first anniversary of the Date of Termination (such period, the “Severance
Period”) in accordance with the customary payroll practices for executive officers of the
Company; provided, however, that Employee shall be entitled to receive the amount payable pursuant
to this Section 5(c)(v) only so long as Employee has not breached the provisions of
Section 8, 9 or 10, at which time the Company’s payment obligations
pursuant to this Section 5(c)(v) shall immediately cease; provided further, however, that
the amount payable pursuant to this Section 5(c)(v) shall be reduced by the amount of any
compensation Employee receives with respect to any other employment of Employee by another Person
during the Severance Period. Employee shall promptly deliver written notice to the Company of the
commencement of any other employment during the Severance Period. Upon request from time to time,
Employee shall furnish the Company with a true and complete certificate specifying any such
compensation earned or received by Employee during the Severance Period; and

               (vi) notwithstanding the terms or conditions of any Award (as defined in the Odyssey
HealthCare, Inc. 2001 Equity-Based Compensation Plan), Employee shall be entitled to exercise
Employee’s Awards that are vested as of the Date of Termination during the 90-day period following
the Date of Termination or such longer period, up to the first anniversary of the Date of
Termination, as the Board may determine in its sole and absolute discretion; provided, however,
that if the terms of the plan or agreement governing such Awards (other than the meaning of “Cause”
and “Disability”) are more favorable to Employee as to exercisability than the terms of this
Section 5(c)(vii), then the more favorable term(s) of such Award agreement or plan shall
govern the exercisability of such Award upon Employee’s termination; provided, further, however,
that in no event shall Employee be entitled to exercise such Awards on any date later than the
earlier of (A) the latest date upon which the Award could

10

 

have expired by its original terms under
any circumstances, or (B) the tenth anniversary of the original date of grant of the Award.

Except as described in this Section 5(c), in the event of Employee’s termination by the
Company without Cause or by Employee for Good Reason, Employee shall forfeit all rights to any
other compensation.

     6. Compensation Upon Employment Termination Occurring On or Within Two Years After a
Change in Control of the Company.

     (a) Compensation Upon Termination. After the occurrence of a Change in Control of the Company and on or before the second
anniversary of such Change in Control, conditioned on the effectiveness of a Release signed by
Employee or Employee’s legal representative pursuant to Section 7(f), Employee shall,
subject to the provisions of Section 7(g), be entitled to the following compensation from
the Company upon the termination of Employee’s employment during the Term, which shall be in lieu
of any other severance pay or employment benefits to which Employee might otherwise be entitled
(whether contractual or under a severance plan, the WARN Act, any other applicable law, or
otherwise):

               (i)
Death
or Disability. If Employee’s employment is terminated by reason of Employee’s death or Disability, then Employee or Employee’s legal representatives shall be entitled to the same compensation benefits from the Company as set forth in Section 5(a) to which Employee would have been entitled if the termination of Employee
’s employment had occurred prior to the occurrence of a Change in Control or after the second anniversary of such Change in Control. Except as described in this Section 6(a)(i), Employee’s death or Disability, Employee and Employee’s legal representatives, as applicable, shall forfeit all rights to any other compensation.

               (ii)
For
Cause; Resignation by Employee Without Good Reason; Non-Renewal Election by Employee. If the Company shall terminate Employee’s employment for Cause or Employee resigns without Good Reason or Employee’s employment is terminated due to a Non-Renewal election by Employee, then Employee or Employee’s legal representatives shall be ent
itled to the same compensation benefits from the Company as set forth in Section 5(b) to which Employee would have been entitled if the termination of Employee’s employment had occurred prior to the occurrence of a Change in Control or after the second anniversary of such Change in Control. Except as described in this Section 6(a)(ii), in the event of Employee’s termination by the Company for Cause or by Employee without Good Reason or due to a Non-Renewal election by Emplo
yee, Employee shall forfeit all rights to any other compensation.

               (iii)
Without
Cause; Resignation by Employee for Good Reason; Non-Renewal Election by the Company. If the Company shall terminate Employee’s employment without Cause (other than by reason of Employee’s death or Disability or a Non-Renewal by Employee) or Employee resigns for Good Reason or Employee’s employment is terminated due to a Non-Re
newal election by the Company, then the Company shall pay or provide Employee:

                    (A)
within
60 days after the Employee’s Date of Termination, a lump sum in cash equal to the aggregate of the following amounts: (1) the Accrued

11

 

Obligations and (2) the amount of
any Annual Bonus to which Employee was entitled for the calendar year ending prior to the
Date of Termination to the extent not previously paid;

               (B) the amount of any Pro Rata Bonus, which shall be paid at such time as the Company
pays the other executives of the Company annual bonuses for the calendar year in which
Employee’s Date of Termination occurs (but in no event later than the fifth business day
after the Company publicly announces its earnings for such calendar year in a press
release);

               (C) the Accrued Investments, which amounts shall be paid in accordance with the terms
and conditions of the Investment Plans;

               (D) the Accrued Welfare Benefits, which amounts shall be paid in accordance with the
terms and conditions of the Welfare Plans; and

               (E) bi-weekly payments equal to 1/26th of the highest Annual Base Salary to which
Employee was entitled during the 24-month period ending on the Date of Termination, payable
in accordance with the customary payroll practices of the
Company, which payments shall continue from the Date of Termination through the later
to occur of (1) the first anniversary of the Date of Termination or (2) the second
anniversary of the date on which the Change in Control was consummated (such period, the
“Change in Control Severance Period”); provided, however, that Employee shall be entitled to
receive the amount payable pursuant to this Section 6(a)(iii)(E) only so long as
Employee has not breached the provisions of Section 8, 9 or 10, at
which time the Company’s payment obligations pursuant to this Section 6(a)(iii)(E)
shall immediately cease; provided further, however, that the amount payable pursuant to this
Section 6(a)(iii)(E) shall be reduced by the amount of any compensation Employee
receives with respect to any other employment of Employee by another Person during the
Change in Control Severance Period. Employee shall promptly deliver written notice to the
Company of the commencement of any other employment during the Change in Control Severance
Period. Upon request from time to time, Employee shall furnish the Company with a true and
complete certificate specifying any such compensation earned or received by Employee during
the Change in Control Severance Period.

Except as described in this Section 6(a)(iii), in the event of Employee’s termination by
the Company without Cause or by Employee for Good Reason or due to a Non-Renewal election by the
Company, Employee shall forfeit all rights to any other compensation.

     7. Other Provisions Relating to Termination.

     (a) Notice of Termination. Any termination by the Company for Cause or without Cause or by
reason of Employee’s Disability, or by Employee’s resignation for Good Reason or without Good
Reason, shall be communicated by Notice of Termination to the other party hereto given in
accordance with Section 13(b). For purposes of this Agreement, a “Notice of
Termination” means a written notice which (i) indicates the specific termination provision in
this Agreement relied upon and (ii) to the extent applicable, sets forth in reasonable detail the
facts

12

 

and circumstances claimed to provide a basis for termination of Employee’s employment under
the provision so indicated. The failure by the Company or Employee to set forth in the Notice of
Termination any fact or circumstance which contributes to a showing of Cause or Good Reason shall
not waive any right of the Company or Employee hereunder or preclude the Company or Employee from
asserting such fact or circumstance in enforcing the Company’s or Employee’s rights hereunder.

     (b) Date of Termination. “Date of Termination” means (i) if Employee’s employment
is terminated by reason of Employee’s death, the date of Employee’s death; (ii) if Employee’s
employment is terminated by reason of Employee’s Disability, the Disability Effective Date
(provided that Employee shall not have returned to perform, with or without reasonable
accommodation, the essential functions of Employee’s position on a full-time basis during such
30-day period); (iii) if Employee’s employment is terminated by the Company without Cause or by
Employee for Good Reason or without Good Reason, then, subject to Section 7(c), the date
specified in the Notice of
Termination (which date shall be a date between the date that the Notice of Termination is given
and 30 days thereafter (inclusive)); (iv) if Employee’s employment is terminated by the Company for
Cause then, subject to Section 7(d), the date on which the Notice of Termination is given;
and (v) if Employee’s employment is terminated due to a Non-Renewal election by Employee or the
Company, the date on which the Term expires.

     (c) Good Reason. Upon Employee’s learning of the occurrence of any event described in the
definition of Good Reason in Section 1(l), Employee may terminate Employee’s employment
hereunder for Good Reason within 60 days thereafter by giving a Notice of Termination to the
Company to that effect, describing in reasonable detail the facts or circumstances giving rise to
Employee’s right to terminate Employee’s employment for Good Reason (and, if applicable, the action
required to cure same). If the effect of the occurrence of the event described in Section
1(l) may be cured, the Company shall have the opportunity to cure any such effect for a period
of 60 days following receipt of Employee’s Notice of Termination. If within 60 days following the
Company’s receipt of a Notice of Termination for Good Reason the Company has not cured the facts or
circumstances giving rise to Employee’s right to terminate Employee’s employment for Good Reason,
then the termination by Employee for Good Reason shall be effective as of the date specified in
Employee’s Notice of Termination. If Employee does not give a Notice of Termination to the Company
within 60 days after learning of the occurrence of an event giving rise to Good Reason, then this
Agreement shall remain in effect; provided, however, that the failure of Employee to terminate this
Agreement for Good Reason shall not be deemed a waiver of Employee’s right to terminate Employee’s
employment for Good Reason upon the occurrence of a subsequent event described in Section
1(l) in accordance with the terms of this Agreement. Notwithstanding the foregoing, the right
of Employee to terminate Employee’s employment for Good Reason under Section 4(d)(i) shall
not limit the Company’s right to terminate Employee’s employment for Cause under Section
4(c) if Cause is determined to exist prior to the time Good Reason is determined to exist.

     (d) Cause. Upon the Company learning of the occurrence of any event described in
Section 1(d), the Company may at any time terminate Employee’s employment hereunder for
Cause within 60 days thereafter by giving Employee a Notice of Termination to that effect,
describing in reasonable detail the facts or circumstances giving rise to the Company’s right to

13

 

terminate Employee’s employment for Cause (and, if applicable, the action required to cure same).
If the Company does not give a Notice of Termination to Employee within 60 days after learning of
the occurrence of an event giving rise to Cause, then this Agreement shall remain in effect;
provided, however, that the failure of the Company to terminate this Agreement for Cause shall not
be deemed a waiver of the Company’s right to terminate Employee’s employment for Cause upon the
occurrence of a subsequent event described in Section 1(d) in accordance with the terms of
this Agreement. Notwithstanding the foregoing, the right of the Company to terminate Employee’s
employment for Cause under Section 4(c) shall not limit Employee’s right to resign for Good
Reason under Section 4(d)(i) if Good Reason is determined to exist prior to the time Cause
is determined to exist.

     (e) Full Settlement; Mitigation. In no event shall Employee be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable to Employee under
any of the provisions of this Agreement, and, except as otherwise provided in Sections
5(c)(v) and 6(a)(iii)(E), such amounts shall not be reduced whether or not Employee
obtains other employment. The Company shall not be liable to Employee for any damages for breach
of this Agreement in addition to the amounts payable under Section 5 or 6 arising
out of the termination of Employee’s employment prior to the end of the Term. The Company shall be
entitled to seek damages from Employee for any breach of Section 8, 9 or 10
by Employee or for Employee’s criminal misconduct.

     (f) Release and Other Agreements. Notwithstanding any other provision in this Agreement to
the contrary, in consideration for receiving the severance benefits described in this Agreement,
Employee hereby agrees to execute (and not revoke) a release within forty-five (45) days of the
Date of Termination in substantially the form attached hereto as Exhibit A (the
“Release”) and such other documents and agreements as reasonably required by the Company,
in the form and pursuant to the procedures reasonably established by the Company. If Employee
fails to properly execute and deliver the Release and such other documents or agreements (or
revokes the Release or such other documents or agreements), Employee agrees that Employee shall not
be entitled to receive the severance benefits described in this Agreement. Without limiting the
foregoing, in consideration for receiving the severance benefits described in this Agreement, upon
any termination of Employee’s employment (other than by reason of death), whether Employee’s
employment is terminated by Employee or by the Company, Employee hereby agrees to resign in
writing, in form and substance reasonably acceptable to the Company, from all officer and/or
director positions with the Company or any Subsidiary or Affiliate thereof, effective on the Date
of Termination. For purposes of this Agreement, the Release and the resignation shall be
considered to have been executed by Employee if it is signed by Employee’s legal representative in
the case of Employee’s legal incompetence or on behalf of Employee’s estate in the case of
Employee’s death. Upon Employee’s execution and delivery of the Release, the Company shall also
promptly execute and deliver the Release.

     (g) 409A Compliance. To the extent required by section 409A of the Code, if on
Employee’s Date of Termination he is a “specified employee” within the meaning of section 409A of
the Code, any amounts payable to Employee by reason of his termination of employment pursuant to
Section 5 or Section 6 will be delayed for a period of six months following the Date of
Termination. In the case of any bi-weekly payments that would have been paid to Employee pursuant
to Section 5(c)(v) or Section 6(a)(iii)(E) such amounts shall be paid

14

 

to him in the
form of a lump sum payment at the end of the six-month period in an amount equal to the total
amount due him pursuant to Section 5(c)(v) or Section 6(a)(iii)(E), as applicable.
Such lump sum payment shall be paid on the date that is six months and one day following the Date
of Termination.

     8. Disclosure of, Access to and Entrustment of Confidential Information, Business Opportunities
and Business Goodwill. During the course of Employee’s employment with the Company (including during the 180-day period
following the Effective Date), the Company shall disclose to Employee, or place Employee in a
position to have access to or develop, Confidential Information (as defined in Section
9(a)(i)), and/or shall entrust Employee with business opportunities of the Company, and/or
shall place Employee in a position to develop business goodwill on behalf of the Company. There is
a need and desire on the part of the Company and Employee to specify the parties’ rights and
obligations with respect to the ownership and protection of such Confidential Information, business
opportunities and goodwill. Accordingly, as a material inducement to the Company to enter into this
Agreement; in consideration for the compensation and other benefits payable hereunder to Employee;
to protect the Company’s Confidential Information that has been and will be in the future disclosed
or entrusted to Employee (the disclosure of which by Employee in violation of this Agreement would
adversely affect the business goodwill of the Company), the business goodwill of the Company that
has been and will in the future be developed in Employee and the business opportunities that have
been and will in the future be disclosed or entrusted to Employee by the Company; and for other
good and valuable consideration, Employee agrees to comply with, and be bound by, Sections
9 and 10. As used in this Section 8, “Company” shall include the Company and
any of its Subsidiaries.

     9. Confidential Information; Ownership of Property.

     (a) Obligations to Maintain Confidentiality.

               (i) Employee acknowledges that the Company has trade, business and financial secrets and other
confidential and proprietary information regarding the Company and its business, in whatever form,
tangible or intangible (collectively, the “Confidential Information”), and that, during the
course of Employee’s employment with the Company (including during the 180-day period following the
Effective Date), Employee has received, shall receive or be placed in a position to have access to
or develop Confidential Information. Employee further acknowledges and agrees that Employee’s use
of Confidential Information in the conduct of business on behalf of a competitor of the Company
would constitute unfair competition with the Company and would adversely affect the business
goodwill of the Company. Confidential Information includes sales materials, technical information,
processes and compilations of information, records, specifications and information concerning
customers, prospective customers, customer and prospective customer lists, and information
regarding methods of doing business. As defined herein, Confidential Information shall not include
information that is (i) obtained by Employee from a source other than the Company or its
Affiliates, which source is not under a duty of non-disclosure in regard to such information or
(ii) becomes generally available to the public other than through disclosure by Employee in
violation of the provisions of this Agreement.

15

 

               (ii) Employee is aware of those policies implemented by the Company to keep its Confidential
Information secret, including those policies limiting the disclosure of information on a
need-to-know basis and requiring the keeping of information in secure areas.
Employee acknowledges that the Confidential Information has been developed or acquired by the
Company through the expenditure of substantial time, effort and money and provides the Company with
an advantage over competitors who do not know or use such Confidential Information.

               (iii) During and following Employee’s employment by the Company, Employee shall hold in
confidence and not directly or indirectly disclose, use (for Employee’s commercial advantage or
otherwise), copy, make lists of, or make available to others any Confidential Information except in
Employee’s good faith performance of Employee’s duties to the Company as an executive of the
Company or to the extent authorized in writing by the Board or required by law or compelled by
legal process. Employee agrees to use reasonable efforts to give the Company notice of any and all
attempts to compel disclosure of any Confidential Information, in such a manner so as to provide
the Company with written notice at least five days before disclosure or within three business days
after Employee is informed that such disclosure is being or shall be compelled, whichever is
earlier. Such written notice shall include a description of the information to be disclosed, the
court, government agency, or other forum through which the disclosure is sought, and the date by
which the information is to be disclosed, and shall contain a copy of the subpoena, order or other
process used to compel disclosure.

               (iv) Employee further agrees not to use any Confidential Information for the benefit of any
person or entity other than the Company.

               (v) Employee agrees that all Confidential Information and other files, documents, materials,
records, notebooks, customer lists, business proposals, contracts, agreements and other
repositories containing information concerning the Company or the business of the Company, in
whatever form, tangible or intangible (including all copies thereof), that Employee shall prepare,
or use, or be provided with as a result of Employee’s employment with the Company, shall be and
remain the sole property of the Company. Upon termination of Employee’s employment hereunder,
Employee agrees that all Confidential Information and other files, documents, materials, records,
notebooks, customer lists, business proposals, contracts, agreements and other repositories
containing information concerning the Company or the business of the Company (including all copies
thereof) in Employee’s possession, custody or control, whether prepared by Employee or others,
shall remain with or be returned to the Company promptly (within 48 hours) after the Date of
Termination. The materials required to be returned pursuant to this Section 9(a)(v) shall
not include personal correspondence or other personal property of Employee that does not relate to
the Company or the business of the Company.

               (vi) Notwithstanding anything herein to the contrary, Employee may disclose to any and all
persons, without limitation of any kind, the U.S. federal income tax treatment and tax structure of
the transactions contemplated in this Agreement and all materials of any kind (including opinions
and other tax analyses) that are provided to Employee relating to such tax treatment and tax
structure. For this purpose, “tax structure” is limited to facts relevant

16

 

to the U.S. federal
income tax treatment of the transactions contemplated in this Agreement and does not include
information relating to the identity of the parties hereto.

     (b) Ownership of Work Product.

          Employee acknowledges that all discoveries, concepts, ideas, inventions, innovations,
improvements, developments, methods, processes, programs, designs, analyses, drawings, reports,
patent applications, copyrightable work and mask work (whether or not including any confidential
information) and all registrations or applications related thereto, all other proprietary
information and all similar or related information (whether or not patentable) that relate to the
Company’s or its Affiliates’ actual or anticipated business, research and development, or existing
or future products or services and that are conceived, developed, contributed to, made, or reduced
to practice by Employee (either solely or jointly with others) while employed by the Company
(including any of the foregoing that constitutes any proprietary information or records) (“Work
Product”) belong to the Company or its Affiliates, as applicable, and Employee hereby assigns,
and agrees to assign, all of the above Work Product to the Company or its Affiliates, as
applicable. Any copyrightable work prepared in whole or in part by Employee in the course of
Employee’s work for any of the foregoing entities shall be deemed a “work made for hire” under the
copyright laws, and the Company or its Affiliates, as applicable, shall own all rights therein. To
the extent that any such copyrightable work is not a “work made for hire,” Employee hereby assigns
and agrees to assign to the Company all right, title, and interest, including without limitation,
copyright in and to such copyrightable work. Employee shall promptly disclose such Work Product
and copyrightable work to the Board and perform all actions reasonably requested by the Board
(whether during or after the Term) to establish and confirm the Company’s or its Affiliates’, as
applicable, ownership (including, without limitation, assignments, consents, powers of attorney,
and other instruments).

          (c) As used in this Section 9 “Company” shall include the Company and any of its
Subsidiaries.

     10. Non-Competition; Non-Solicitation; Non-Disparagement.

          (a) For the reasons and consideration specified in Section 8, Employee hereby
covenants and agrees that, during the Term of Non-Competition, Employee shall not, directly or
indirectly, individually or as an officer, director, manager, employee, stockholder, consultant,
contractor, partner, member, joint venturer, agent, equity owner or in any capacity whatsoever:

               (i) own, engage in, manage, operate, join, control, be employed by, provide Competing Services
to, or participate in the ownership, management, operation or control of or provision of Competing
Services to, a Competing Business operating in the Geographic Area;

               (ii) recruit, hire, assist in hiring, attempt to hire, or contact or solicit with respect to
hiring any Person who, at any time during the 12 month period ending on the Date of Termination,
was an employee of the Company; provided, that Employee may hire any Person that served as an
administrative assistant or clerical employee at the time Employee’s employment with the Company
terminates;

17

 

               (iii) induce or attempt to induce any employee of the Company to terminate, or in any way
interfere with, the relationship between the Company and any employee thereof; or

               (iv) induce or attempt to induce any customer, client, patient, supplier, service provider, or
other business relation of the Company in the Geographic Area to cease doing business with the
Company, or in any way interfere with the relationship between the Company and any such Person.

          Notwithstanding the foregoing, the Company agrees that Employee may own less than one percent
of the outstanding voting securities of any publicly traded company that is a Competing Business so
long as Employee does not otherwise participate in such competing business in any way prohibited by
this Section 10.

          (b) Employee shall not make any negative or disparaging comments regarding the Company, its
Subsidiaries or Affiliates or any of their respective officers, directors, shareholders, partners,
members, managers, agents or employees (collectively, the “Representatives”), including
regarding the performance of the Company, its Subsidiaries or Affiliates, or otherwise take any
action that could reasonably be expected to adversely affect the Company, its Subsidiaries or
Affiliates or the personal or professional reputation of any of their respective Representatives.
Information required to be disclosed by Employee pursuant to any applicable law, court order,
subpoena, process or governmental decree shall not constitute a violation or breach of this
Section 10(b); provided, that Employee delivers written notice of such required disclosure
to the Company promptly before making such disclosure if such notice is not prohibited by
applicable law, court order, subpoena, process or governmental decree.

          (c) Employee acknowledges that the geographic boundaries, scope of prohibited activities, and
time duration of the preceding paragraphs in this Section 10 (including the defined terms
for “Competing Business,” “Geographic Area,” and “Term of Non-Competition” set forth in
Section 1) are reasonable in nature and are no broader than are necessary to maintain the
goodwill of the Company and the confidentiality of its Confidential Information and to protect the
goodwill and other legitimate business interests of the Company, and also that the enforcement of
such covenants would not cause Employee any undue hardship or unreasonably interfere with
Employee’s ability to earn a livelihood. If Employee violates the covenants and restrictions in
this Section 10 and the Company brings legal action for injunctive or other equitable
relief, Employee agrees that the Company shall not be deprived of the benefit of the full period of
the restrictive covenant, as a result of the time involved in obtaining such relief. Accordingly,
Employee agrees that the provisions in Section 10(a) shall have a duration determined
pursuant to Section 10(a), computed from the date the legal or equitable relief is granted.

          (d) If any court in any jurisdiction determines that any portion of this Section 10
(including the defined terms for “Competing Business,” “Geographic Area,” and “Term of
Non-Competition” set forth in Section 1) is invalid or unenforceable within such
jurisdiction under circumstances then existing, the remainder of this Section 10 (including
the defined terms for “Competing Business,” “Geographic Area,” and “Term of Non-Competition” set
forth in Section 1) shall not thereby be affected and shall be given full effect without
regard

18

 

to the invalid or unenforceable provisions. If any court in any jurisdiction construes any of
the provisions of this Section 10 (including the defined terms for “Competing Business,”
“Geographic Area,” and “Term of Non-Competition” set forth in Section 1) to be invalid or
unenforceable within such jurisdiction under circumstances then existing, because of the duration,
scope or geographical area of such provision, such court shall be required to substitute the
maximum duration, scope or geographical area reasonable under such circumstances within such
jurisdiction for the stated period, scope or area with respect to such jurisdiction and such court
shall be allowed to revise the restrictions contained herein to cover the maximum duration, scope
and area permitted by law, and to enforce such provision as so revised.

          (e) As used in this Section 10 (and the defined terms for “Competing Business,”
“Geographic Area,” and “Term of Non-Competition” set forth in Section 1), “Company” shall
include the Company and any of its Subsidiaries.

     11. Successors; Binding Agreement.

          (a) This Agreement is personal to Employee and shall not be assignable by Employee otherwise
than by will or the by laws of descent and distribution. This Agreement shall inure to the benefit
of and be enforceable by Employee’s personal and legal representatives, executors, administrators,
heirs, distributes, devisees and legatees.

          (b) This Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.

          (c) The Company shall require any successor (whether direct or indirect, by purchase, merger,
consolidation, sale of assets or otherwise) to all or substantially all of the business and/or
assets of the Company, by a written agreement in form and substance reasonably satisfactory to
Employee, to assume expressly and agree to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such succession had taken place.
Failure of the Company to obtain such agreement prior to the effectiveness of any such succession
shall be a breach of this Agreement and shall entitle Employee to compensation from the Company in
the same amount and on the same terms as Employee would be entitled to pursuant to
Section 6 if Employee terminated Employee’s employment for Good Reason after, but before
the second anniversary of, the occurrence of a Change in Control, except that for purposes of
implementing the foregoing, the date on which any such succession becomes effective shall be deemed
the Date of Termination. As used in this Agreement and after any such succession, “Company” shall
mean the Company as hereinbefore defined and any successor and/or assigns as aforesaid which
assumes and agrees to perform this Agreement by operation of law, or otherwise.

     12. Effect of Agreement on Plans and Agreements Governing Awards. Notwithstanding anything
to the contrary contained in any plan or agreement governing an Award granted to Employee prior to,
on or after the date of this Agreement, the respective meanings of “Cause” and “disability” as used
in any such plans or agreements shall have the
meaning ascribed to such terms by this Agreement for purposes of giving effect to such Awards on
and after the date of this Agreement.

19

 

     13. Miscellaneous.

     (a) Construction. This Agreement shall be deemed drafted equally by both the parties. Its
language shall be construed as a whole and according to its fair meaning. Any presumption or
principle that the language is to be construed against any party shall not apply. The headings in
this Agreement are only for convenience and are not intended to affect construction or
interpretation. Any references to paragraphs, subparagraphs, sections, subsections or clauses are
to those parts of this Agreement, unless the context clearly indicates to the contrary. Also,
unless the context clearly indicates to the contrary, (i) the plural includes the singular and the
singular includes the plural; (ii) “and” and “or” are each used both conjunctively and
disjunctively; (iii) “any,” “all,” “each,” or “every” means “any and all”, and “each and every”;
(iv) “includes” and “including” are each “without limitation”; (v) “herein,” “hereof,” “hereunder”
and other similar compounds of the word “here” refer to the entire Agreement and not to any
particular paragraph, subparagraph, section or subsection; and (vi) all pronouns and any variations
thereof shall be deemed to refer to the masculine, feminine, neuter, singular or plural as the
identity of the entities or persons referred to may require.

     (b) Notices. All notices and other communications hereunder shall be in writing and shall
be given by hand delivery to the other party or by registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:

	 	 	 	 	 
	 

	 	if to Employee:
	 	if to the Company:
	 
	 	 	 	 
	 

	 	Frank Anastasio
	 	Odyssey HealthCare, Inc.
	 

	 	10523 Black Iron Road
	 	717 North Harwood, Suite 1500
	 

	 	Louisville, Kentucky 40291
	 	Dallas, Texas 75201
	 

	 	 	 	Attn: Chief Executive Officer
	 
	 	 	 	 
	 

	 	 	 	with a copy to:
	 
	 	 	 	 
	 

	 	 	 	P. Gregory Hidalgo
	 

	 	 	 	Vinson & Elkins L.L.P.
	 

	 	 	 	3700 Trammell Crow Center
	 

	 	 	 	2001 Ross Avenue
	 

	 	 	 	Dallas, Texas 75201

or to such other address as either party shall have furnished to the other in writing in accordance
herewith. Notice and communications shall be effective when actually received by the addressee.

     (c) Severability. Except as otherwise provided in Section 10(d), if any provision
of this Agreement is held to be illegal, invalid or unenforceable under present or future laws
effective during the term of this Agreement, such provision shall be fully severable; this
Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision
had never comprised a portion of this Agreement; and the remaining provisions of this Agreement
shall remain in full force and effect and shall not be affected by the illegal, invalid or
unenforceable provision or by its severance from this Agreement. Furthermore, except as

20

 

otherwise
provided in Section 10(d), in lieu of such illegal, invalid or unenforceable provision
there shall be added automatically as part of this Agreement a provision as similar in terms to
such illegal, invalid or unenforceable provision as may be possible and be legal, valid and
enforceable.

     (d) Withholding. The Company may withhold from any amounts payable under this Agreement
such Federal, state or local taxes as shall be required to be withheld pursuant to any applicable
law or regulation.

     (e) No Waiver. Except as expressly set forth in this Agreement, no waiver by either party
at any time of any breach by the other party of, or compliance with, any condition or provision of
this Agreement to be performed by the other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at any time.

     (f) Equitable and Other Relief. Employee acknowledges that money damages would be both
incalculable and an insufficient remedy for a breach of Sections 8, 9 or 10
by Employee and that any such breach would cause the Company irreparable harm. Accordingly, the
Company, in addition to any other remedies at law or in equity it may have, shall be entitled,
without the requirement of posting of bond or other security, to equitable relief, including
injunctive relief and specific performance, in connection with a breach of Sections 8,
9 or 10 by Employee. The parties agree that the only circumstances in which
disputes between them will not be subject exclusively to arbitration pursuant to the provisions in
Section 13(h) are in connection with a breach of Sections 8, 9 or
10 by Employee. If the Company files a pleading with a court seeking immediate injunctive
relief and this pleading is challenged by Employee and injunctive relief sought is not awarded, the
Company shall pay all of Employee’s costs and attorneys’ fees. The parties consent to venue in
Dallas County, Texas and to the exclusive jurisdiction of competent state courts or federal courts
in the state or district in Dallas County, Texas for all litigation which may be brought, subject
to the requirement for arbitration in Section 13(h), with respect to the terms of, and the
transactions and relationships contemplated by, this Agreement. The parties further consent to the
non-
exclusive jurisdiction of any state court located within a district which encompasses assets of a
party against which a judgment has been rendered for the enforcement of such judgment or award
against the assets of such party.

     (g) Entire Agreement. The provisions of this Agreement constitute the entire and complete
understanding and agreement between the parties with respect to the subject matter hereof, and
supersede all prior and contemporaneous oral and written agreements, representations and
understandings of the parties, which are hereby terminated. Employee and the Company acknowledge
and represent that there are no other promises, terms, conditions or representations (or written)
regarding any matter relevant hereto.

     (h) Arbitration. Except as otherwise provided in Section 13(f), in the event any
claim, demand, cause of action, dispute, controversy or other matter in question (“Claim”)
arises out of this Agreement (or its termination) or Employee’s employment (or termination of
employment) by the Company or its Subsidiaries, then, upon the written request of Employee or the
Company, such dispute or controversy will be submitted to binding arbitration. Any arbitration
will be conducted in accordance with the Federal Arbitration Act (“FAA”) and, to the extent
an issue is not addressed by the FAA or the FAA does not apply, with the then-current

21

 

National
Rules for the Resolution of Employment Disputes of the American Arbitration Association
(“AAA”) or other rules of the AAA as applicable to the claims asserted. The results of
arbitration will be binding and conclusive on the parties hereto. All parties agree that venue for
arbitration will be in Dallas County, Texas. If Employee is the prevailing party, then Employee
will be entitled to reimbursement by the Company for reasonable attorneys fees, reasonable costs
and other reasonable expenses pertaining to the arbitration. All proceedings conducted pursuant to
this Section 13(h) will be kept confidential by all parties. THE ARBITRATORS SHALL HAVE NO
AUTHORITY TO AWARD PUNITIVE DAMAGES UNDER ANY CIRCUMSTANCES (WHETHER IT BE EXEMPLARY DAMAGES,
TREBLE DAMAGES, OR ANY OTHER PENALTY OR PUNITIVE TYPE OF DAMAGES). REGARDLESS OF WHETHER SUCH
DAMAGES MAY BE AVAILABLE UNDER TEXAS LAW, EMPLOYEE AND THE COMPANY EACH HEREBY WAIVE THE RIGHT, IF
ANY, TO RECOVER PUNITIVE DAMAGES IN CONNECTION WITH ANY CLAIMS. EMPLOYEE AND THE COMPANY
ACKNOWLEDGE THAT BY SIGNING THIS AGREEMENT EMPLOYEE AND THE COMPANY ARE WAIVING ANY RIGHT THAT
EMPLOYEE OR THE COMPANY MAY HAVE TO A JURY TRIAL OR, OTHER THAN AS EXPRESSLY PROVIDED BY
SECTION 13(f), A TRIAL BEFORE A JUDGE IN CONNECTION WITH, OR RELATING TO, A CLAIM.

     (i) Attorney Fees. The prevailing party in any dispute or controversy under or in
connection with this Agreement shall be entitled to reimbursement from the non-prevailing party for
all costs and reasonable legal fees incurred by such prevailing party.

     (j) Survival. Sections 1 and 4 through 13 of this Agreement shall
survive the termination of this Agreement.

     (k) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF TEXAS WITHOUT REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS OF TEXAS OR ANY
OTHER JURISDICTION, AND, WHERE APPLICABLE, THE LAWS OF THE UNITED STATES.

     (l) Amendments. This Agreement may not be amended or modified at any time except by a
written instrument approved by the Board and executed by the Company and Employee.

     (m) Employee Acknowledgement. Employee acknowledges that Employee has read and understands
this Agreement, is fully aware of its legal effect, has not acted in reliance upon any
representatives or promises made by the Company other than those contained in writing herein, and
has entered into this Agreement freely based on Employee’s own judgment.

     (n) Counterparts. This Agreement may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one and the same instrument.
Any counterpart of this Agreement that has attached to it separate signature pages which together
contain the signature of all parties hereto shall for all purposes be deemed a fully executed
original. Facsimile signatures shall constitute original signatures.

22

 

     IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the date and year
first above written.

	 	 	 	 	 	 	 
	 	 	COMPANY:
	 
	 	 	 	 	 	 
	 	 	ODYSSEY HEALTHCARE, INC.
	 	 	a Delaware corporation
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Robert A. Lefton	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Robert A. Lefton	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	President & Chief Executive
Officer	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	EMPLOYEE:
	 
	 	 	 	 
	 
	 	/s/ Frank W. Anastasio	 	 
	 	 	 	 	 
	 	 	   Frank Anastasio

[SIGNATURE PAGE TO
EMPLOYMENT AGREEMENT]

23

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}]]