Document:

eightk1208ex103.htm

  
    Exhibit
10.3

    REHABCARE
GROUP, INC.

    TERMINATION
COMPENSATION AGREEMENT

    

    

    This
agreement (“Agreement”) has been entered into as of the 8th day of December,
2008, by and between RehabCare Group, Inc., a Delaware corporation (the
“Company”), and Patricia M Henry, an individual (the “Executive”).

    

    The
Company and the Executive previously entered into that certain agreement dated
as of the 10th day of March, 2006, regarding the employment relationship between
the Company and the Executive (the “Existing Agreement”).  The Company
and the Executive now desire to amend and restate the Existing Agreement in its
entirety as of the date hereof to conform to the provisions of the final
regulations under Section 409A of the Internal Revenue
Code.  Therefore, the Company and the Executive hereby amend and
restate the Existing Agreement in its entirety to read as follows:

    

    RECITALS

    

    The Board
of Directors of the Company has determined that it is in the best interests of
the Company and its stockholders to reinforce and encourage the continued
attention and dedication of the Executive to the Company as the Company’s
Executive Vice President and to assure that the Company will have the continued
dedication of the Executive, notwithstanding the possibility or occurrence of a
Change in Control (as defined below).  The Board desires to provide
for the continued employment of the Executive as Executive Vice President on
terms competitive with those of other corporations, and the Executive is willing
to rededicate himself and continue to serve the Company as its Executive Vice
President.  Additionally, the Board believes it is imperative to
diminish the inevitable distraction of the Executive by virtue of the personal
uncertainties and risks created by a potential or pending Change in Control and
to encourage the Executive’s full attention and dedication to the Company
currently and in the event of any potential or pending Change in Control, and to
provide the Executive with compensation and benefits arrangements upon any
termination after a Change in Control and certain terminations of employment
prior to a Change in Control which ensure that the compensation and benefits
expectations of the Executive will be satisfied.  Therefore, in order
to accomplish these objectives, the Board has caused the Company to enter into
this Agreement.

    

    IT IS AGREED AS
FOLLOWS:

    

    Section
1:                                Definitions
and Construction.

    

    1.1           Definitions. For purposes of
this Agreement, the following words and phrases, whether or not capitalized,
shall have the meanings specified below, unless the context plainly requires a
different meaning.

    

    1.1(a)                      “Accrued Obligations” has the
meaning set forth in Section 4.1(a) of this Agreement.

    

    1.1(b)                      “Annual Base Salary” has the
meaning set forth in Section 2.4(a) of this Agreement.

    

    1.1(c)                      “Board” means the Board of
Directors of the Company.

    

    1.1(d)                      “Cause” has the meaning set
forth in Section 3.3 of this Agreement.

    

    1.1(e)                      “Change in Control”
means:

    

    (i)           The
acquisition by one person, or more than one person acting as a group, of
ownership of stock of the Company that, together with stock held by such person
or group, constitutes more than 50% of the total fair market value or total
voting power of the stock of the Company;

    

    (ii)           The
acquisition by one person, or more than one person acting as a group, of
ownership of stock of the Company, that together with stock of the Company
acquired during the twelve-month period ending on the date of the most recent
acquisition by such person or group, constitutes 30% or more of the total voting
power of the stock of the Company;

    

    (iii)           A
majority of the members of the Company’s board of directors is replaced during
any twelve-month period by directors whose appointment or election is not
endorsed by a majority of the members of the Company’s board of directors before
the date of the appointment or election;

    

    (iv)           One
person, or more than one person acting as a group, acquires (or has acquired
during the twelve-month period ending on the date of the most recent acquisition
by such person or group) assets from the Company that have a total gross fair
market value (determined without regard to any liabilities associated with such
assets) equal to or more than 40% of the total gross fair market value of all of
the assets of the Company immediately before such acquisition or
acquisitions.

    

    Persons
will not be considered to be acting as a group solely because they purchase or
own stock of the same corporation at the same time, or as a result of the same
public offering.  However, persons will be considered to be acting as
a group if they are owners of a corporation that enters into a merger,
consolidation, purchase or acquisition of stock, or similar business transaction
with the Company.

    

    This
definition of Change in Control shall be interpreted in accordance with, and in
a manner that will bring the definition into compliance with, the regulations
under Code Section 409A.

    

    1.1(f)                      “Change in Control Date” means
the date that the Change in Control first occurs.

    

    1.1(g)                      “Company” has the meaning set
forth in the first paragraph of this Agreement and, with regard to successors,
in Section 6.2 of this Agreement.

    

    1.1(h)                      “Code” shall mean the Internal
Revenue Code of 1986, as amended.

    

    1.1(i)                      “Date of Termination” has the
meaning set forth in Section 3.7 of this Agreement.  In all cases, a
“Date of Termination” shall only occur upon separation from service from the
Company and all of its affiliates, as defined in Treasury regulations under
Section 409A of the Code (generally, separation from the 50% controlled group
that includes the Company).

    

    1.1(j)                      “Disability” has the meaning
set forth in Section 3.2 of this Agreement.

    

    1.1(k)                      “Disability Effective Date”
has the meaning set forth in Section 3.2 of this Agreement.

    

    1.1(l)                      “Effective Date” means the
date of this Agreement specified in the first paragraph of this
Agreement.

    

    1.1(m)                      “Employment Period” means the
period beginning on the Effective Date and ending on the later of (i) December
31, 2009, or (ii) December 31 of any succeeding year during which notice is
given by either party (as described in Section 2.1 of this Agreement) of such
party’s intent not to renew this Agreement.

    

    1.1(n)                       “Excise Tax” has the meaning
set forth in Section 4.2(f)(i) of this Agreement.

    

    1.1(o)                      “Good Reason” has the meaning
set forth in Section 3.4 of this Agreement.

    

    1.1(p)                      “Gross-Up Payment” has the
meaning set forth in Section 4.2(f)(i) of this Agreement.

    

    1.1(q)                       “Notice of Termination” has
the meaning set forth in Section 3.6 of this Agreement.

    

    1.1(r)                      “Other Benefits” has the
meaning set forth in Section 4.1(e) of this Agreement.

    

    1.1(s)                       “Payment” has the meaning set
forth in Section 4.2(f)(i) of this Agreement.

    

    1.1(t)                      “Prorated Target Bonus” has
the meaning set forth in Section 4.2(a) of this Agreement.

    

    1.1(u)                      “Specified Employee” has the
meaning set forth in Section 4.9 of this Agreement.

    

    1.1(v)                      “Target Bonus” has the meaning
set forth in Section 2.4(b) of this Agreement.

    

    1.1(w)                      “Term” means the period that
begins on the Effective Date and ends on the earlier of: (i) the Date of
Termination, or (ii) the close of business on the later of December 31, 2009 or
December 31 of any renewal term.

    

    1.2           Gender and
Number.  When appropriate, pronouns in this Agreement used in
the masculine gender include the feminine gender, words in the singular include
the plural, and words in the plural include the singular.

    

    1.3           Headings.  All
headings in this Agreement are included solely for ease of reference and do not
bear on the interpretation of the text.  Accordingly, as used in this
Agreement, the terms “Article” and “Section” mean the text that accompanies the
specified Article or Section of the Agreement.

    

    1.4           Applicable
Law.  This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Missouri, without reference to
its conflict of law principles.

    

    Section
2:                                Terms
and Conditions of Employment.

    

    2.1           Period of
Employment.  The Executive shall remain in the employ of the
Company throughout the Term of this Agreement in accordance with the terms and
provisions of this Agreement.  This Agreement will automatically renew
for annual one-year periods unless either party gives the other written notice,
by September 30, 2009, or September 30 of any succeeding year, of such party’s
intent not to renew this Agreement.

    

    2.2           Positions and
Duties.

    

    2.2(a)                      Throughout
the Term of this Agreement, the Executive shall serve as Executive Vice
President of the Company subject to the reasonable directions of the
Board.  The Executive shall have such authority and shall perform such
duties as are specified by the Bylaws of the Company and the Board for the
office of Executive Vice President, subject to the control exercised by the
Board from time to time.

    

    2.2(b)                      Throughout
the Term of this Agreement (but excluding any periods of vacation and sick leave
to which the Executive is entitled), the Executive shall devote reasonable
attention and time during normal business hours to the business and affairs of
the Company and shall use his reasonable best efforts to perform faithfully and
efficiently such responsibilities as are assigned to him under or in accordance
with this Agreement; provided that, it shall not be a violation of this Section
2.2(b) for the Executive to (i) serve on corporate, civic or charitable boards
or committees with or without compensation, (ii) deliver lectures or fulfill
speaking engagements, with or without compensation, or (iii) manage personal
investments, so long as such activities do not significantly interfere with the
performance of the Executive’s responsibilities as an employee of the Company in
accordance with this Agreement, violate the terms of this Agreement or any other
agreement between Executive and the Company, or violate the Company’s conflict
of interest policy or any applicable law.

    

    2.3           Situs of Employment.
Throughout the Term of this Agreement, the Executive’s services shall be
performed at and out of the Company’s executive offices located in the greater
St. Louis, Missouri metropolitan area or such other office as shall be agreed to
between the Executive and the President and Chief Executive Officer of the
Company.

    

    2.4           Compensation.

    

    2.4(a)                      Annual Base
Salary.  At the date of this Agreement, the Executive will be
paid a base salary (“Annual Base Salary”) at an annual rate of Three Hundred
Sixty Two Thousand Dollars ($362,000), which shall be paid in equal or
substantially equal semi-monthly installments.  During the Term of
this Agreement, the Annual Base Salary payable to the Executive shall be
reviewed at least annually after the end of the first calendar quarter (starting
with calendar year 2009) and shall be increased at the discretion of the Board
or the Compensation and Nominating/Corporate Governance Committee of the Board
but shall not be reduced.

    

    2.4(b)                      Incentive
Bonuses.  In addition to Annual Base Salary, the Executive
shall be awarded the opportunity to earn an incentive bonus on an annual basis
under any incentive compensation plan which is generally available to other peer
executives of the Company.  The Board of Directors or the Compensation
and Nominating/Corporate Governance Committee shall establish at the beginning
of each calendar year a target incentive award equal to a designated percentage
of  the Executive’s Annual Base Salary paid during that plan year (the
“Target Bonus”). The Board and/or the Compensation and Nominating/Corporate
Governance Committee may also establish minimum and maximum incentive bonus
opportunities on an annual basis in addition to the Target Bonus. The Board of
Directors shall be exclusively responsible for decisions relating to
administration of the executive incentive plans.

    

    2.4(c)                      Incentive, Savings and Retirement
Plans.  Throughout the Term of this Agreement, the Executive
shall be entitled to participate in all equity incentive, savings and retirement
plans generally available to other peer executives of the Company; provided,
however, that the nature and level of any equity incentive awards shall be
solely determined by the Board or the Compensation and Nominating/Corporate
Governance Committee in its discretion.  Also, during the Term, the
Executive shall be eligible to participate in the Company’s long term cash
incentive plan.  During the Term, the percentage of Annual Base Salary
upon which a potential award shall be based shall be established by the Board or
the Compensation and Nominating/Corporate Governance Committee in its
discretion.  For each three (3) year performance period during the
Term and under the plan, the financial metrics for receiving a payout will be
established by the Board or the Committee in its discretion and otherwise
determined by the terms of the plan. Payment of awards under the long term cash
incentive plan, and eligibility to receive any payment, will be determined under
and according to the terms of that plan and based upon performance criteria
established annually by the Board or the Committee under the
plan.  Nothing herein prevents the Company from terminating or
changing the long term cash incentive plan in its discretion, subject to a
participant’s right under the plan as to any incentive award which has already
been earned.

    

    2.4(d)                      Welfare Benefit
Plans.  Throughout the Term of this Agreement (and thereafter,
subject to Section 4.1(d) or 4.2(d) hereof), the Executive and/or the
Executive’s family, as the case may be, shall be eligible for participation in
and shall receive all benefits under welfare benefit plans, practices, policies
and programs provided by the Company (including, without limitation, medical,
prescription, dental, disability, salary continuance, employee life, group life,
accidental death and travel accident insurance plans and programs) to the extent
generally available to other peer executives of the Company.

    

    2.4(e)                      Expenses.  Throughout
the Term of this Agreement, the Executive shall be entitled to receive prompt
reimbursement for all reasonable business expenses incurred by the Executive in
accordance with the policies, practices and procedures of the
Company.   Such expense reimbursements shall be made no later
than the end of the calendar year following the calendar year in which the
expenses were incurred.

    

    2.4(f)                      Fringe
Benefits.  Throughout the Term of this Agreement, the Executive
shall be entitled to such fringe benefits as generally are provided to other
peer executives of the Company.

    

    2.4(g)                      Office and Support
Staff.  Throughout the Term of this Agreement, the Executive
shall be entitled to an office or offices at the Company’s executive offices in
the greater St. Louis, Missouri metropolitan area and/or at such other location
as the Executive and the President and Chief Executive Officer of the Company
shall agree of a size and with furnishings and other appointments, and to
personal secretarial and other assistance, as are generally provided to other
peer executives of the Company.

    

    2.4(h)                      Vacation.  Throughout
the Term of this Agreement, the Executive shall be entitled to paid vacation in
accordance with the plans, policies, programs and practices as are generally
provided to other peer executives of the Company.

    

    Section
3:                                Termination
of Employment.

    

    3.1           Death.  The
Executive’s employment shall terminate automatically upon the Executive’s death
during the Employment Period.

    

    3.2           Disability.  If the
Company determines in good faith that the Disability of the Executive has
occurred during the Employment Period (pursuant to the definition of Disability
set forth below), the Company may give to the Executive written notice in
accordance with Section 7.2 of its intention to terminate the Executive’s
employment.  In such event, the Executive’s employment with the
Company shall terminate effective on the thirtieth (30th) day after receipt of
such notice by the Executive (the “Disability Effective Date”), provided that,
within the thirty (30) days after such receipt, the Executive shall not have
returned to full-time performance of the Executive’s duties.  For
purposes of this Agreement, “Disability” shall mean that the Executive has been
unable with reasonable accommodation to perform the services required of the
Executive hereunder on a full-time basis for a period of one hundred eighty
(180) consecutive business days by reason of a physical and/or mental
condition.  “Disability” shall be deemed to exist when certified by a
physician selected by the Company and acceptable to the Executive or the
Executive’s legal representative (such agreement as to acceptability not to be
withheld unreasonably).  The Executive will submit to such medical or
psychiatric examinations and tests as such physician deems necessary to make any
such Disability determination.

    

    3.3           Termination for Cause or without
Cause.  The Company may terminate the Executive’s employment
during the Employment Period for “Cause,” which shall mean termination based
upon: (i) the Executive’s willful and continued failure to substantially perform
his duties with the Company (other than as a result of incapacity due to
physical or mental condition), after a written demand for substantial
performance is delivered to the Executive by the Company, which specifically
identifies the manner in which the Executive has not substantially performed his
duties, (ii) the Executive’s commission of an act constituting a criminal
offense that would be classified as a felony under the applicable criminal code
or involving moral turpitude, dishonesty, or breach of trust, or (iii) the
Executive’s material breach of any provision of this Agreement.  For
purposes of this Section, no act or failure to act on the Executive’s part shall
be considered “willful” unless done, or omitted to be done, without good faith
and without reasonable belief that the act or omission was in the best interest
of the Company.  Notwithstanding the foregoing, the Executive shall
not be deemed to have been terminated for Cause unless and until (i) he receives
a Notice of Termination from the Company, (ii) he is given the opportunity, with
counsel, to be heard before the Board, and (iii) the Board finds, in its good
faith opinion, that the Executive was guilty of the conduct set forth in the
Notice of Termination. The Company also may terminate the Executive’s employment
at any time during the Employment Period without Cause.

    

    3.4           Termination by Executive for Good
Reason.  The Executive may terminate his employment with the
Company during the Employment Period for “Good Reason,” which shall mean
termination based upon the occurrence of one or more of the following without
the consent of the Executive: (i) a material reduction in the Executive’s
authority, duties and responsibilities; (ii) a material reduction in Executive’s
Annual Base Salary; (iii) a material reduction in the budget over which the
Executive retains authority; (iv) a material change in the primary geographic
location at which the Executive performs his duties under this Agreement; or (v)
any other action or inaction that constitutes a material breach by the Company
of any provision of this Agreement. Any termination of the Executive’s
employment based upon a good faith determination of “Good Reason” made by the
Executive shall be subject to a delivery of a Notice of Termination by the
Executive to the Company in the manner prescribed in Section 3.6 within fifteen
(15) days of the first occurrence of an event that would constitute Good Reason
and subject further to the ability of the Company to remedy within thirty (30)
days of receipt of such notice any action that may otherwise constitute Good
Reason under this Section 3.4.

    

    3.5           Voluntary Termination by the
Executive.  The Executive may voluntarily terminate his
employment with the Company for any reason or for no reason at any time during
the Employment Period.

    

    3.6           Notice of
Termination.  Any termination by the Company for Cause, without
Cause, or Disability, or by the Executive for any reason or no reason, shall be
communicated by Notice of Termination to the other party, given in accordance
with Section 7.2.  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, (ii) to the extent applicable, sets
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive’s employment under the provision so
indicated, and (iii) if the Date of Termination (as defined in Section 3.7
hereof) is other than the date of receipt of such notice, specifies the
termination date (which date shall be not more than fifteen (15) days after the
giving of such notice).  The failure of the Company to set forth in
the Notice of Termination any fact or circumstance which contributes to a
showing of Cause shall not waive any right of the Company hereunder or
preclude  the Company from asserting such fact or circumstance in
enforcing  the Company’s rights hereunder.

    

    3.7           Date of
Termination.  “Date of Termination” means (i) if the
Executive’s employment is terminated by the Company for Cause, the Date of
Termination shall be the date of receipt by the Executive of the Notice of
Termination or any later date specified therein, as the case may be; (ii) if the
Executive’s employment is terminated by reason of death or Disability, the Date
of Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be; (iii) if the Executive’s employment is
voluntarily terminated by the Executive for any reason or no reason, the Date of
Termination shall be a date specified in the Notice of Termination, provided
that termination by Executive for Good Reason shall not be effective until
thirty (30) days following the date of the Notice of Termination; or (iv) if the
Executive’s employment is terminated by the Company other than for Cause, death,
or Disability, the Date of Termination shall be the date of receipt by the
Executive of the Notice of Termination.

    

    Section
4:                                Certain
Benefits Upon Termination.

    

    4.1           Termination Without Cause or Timely
Termination for Good Reason Prior to a Change in
Control.  Subject to the provisions of Section 4.9, if, prior
to a Change in Control during the Employment Period, the Company terminates the
Executive’s employment without Cause or the Executive terminates his employment
with the Company for Good Reason within forty-five (45) days of the first
occurrence of an event that would constitute Good Reason that has not been
remedied by the Company as described in Section 3.4, the Executive shall be
entitled to the payment of the benefits provided below:

    

    4.1(a)                      Accrued
Obligations.  Within thirty (30) days after the Date of
Termination, the Company shall pay to the Executive the sum of (1) the
Executive’s accrued salary through the Date of Termination, and (2) any accrued
and unused paid days off; in each case to the extent not previously paid
(hereinafter referred to as the “accrued obligations”). In addition, Executive
shall be entitled to the accrued benefit payable to the Executive under any
deferred compensation plan, program or arrangement in which the Executive is a
participant, which shall be payable in the time and manner provided under the
applicable plan, program or arrangement.  Payment under any annual or
long-term cash incentive plan shall be determined and governed solely by the
terms of the applicable plan.

    

    4.1(b)                      Annual Base Salary and
Target Bonus Continuation.  For a period of twelve (12) months
beginning in the month after the Date of Termination, the Company shall pay to
the Executive on a monthly basis one-twelfth of an amount equal the sum of
Executive’s then-current Annual Base Salary and Target Bonus for the year in
which the Date of Termination occurs.  Payments under any long term
cash incentive plan are not part of or included in this
calculation.

    

    4.1(c)                      Stock-Based
Awards.  All stock-based awards held by the Executive will be
exercisable or vested, expire or terminate in accordance with the terms of their
respective grant agreements.

    

    4.1(d)                      Health Benefit
Continuation.  For twelve (12) months following the Date of
Termination, the Company shall pay the COBRA premiums for the Executive and his
spouse and other eligible dependents for the medical, dental, vision and
prescription drug plan(s) maintained by the Company in which the Executive and
his spouse or other dependents were participating immediately prior to the Date
of Termination; provided, however,
that if the Executive becomes reemployed with another employer and is eligible
to receive medical or health benefits under another employer-provided plan,
program, practice or policy the Company’s COBRA premium payments described
herein shall be immediately terminated upon the commencement of coverage under
the new employer’s plan, program, practice or policy.  In addition, to
the extent that the COBRA premiums paid by the Company are taxable to the
Executive, the Company shall pay to the Executive a gross-up payment for
applicable taxes.  Such payment shall be made monthly during the
period the COBRA premiums are paid by the Company.

    

    4.1(e)                      Outplacement.  During
the twelve (12) month period following the Date of Termination, the Company
shall provide to Executive executive-level outplacement services by a vendor
selected by the Company.

    

    4.2           Benefits Upon a Change in
Control.  Subject to the provisions of Section 4.9, if a Change
in Control occurs during the Employment Period and within two (2) years after
the Change in Control Date (a) the Company terminates the Executive’s employment
without Cause, or (b) the Executive terminates employment with the Company for
Good Reason, then the Executive shall become entitled to the payment of the
benefits as provided below:

    

    4.2(a)                      Accrued
Obligations.  Within thirty (30) days after the Date of
Termination, the Company shall pay to the Executive the Accrued Obligations and
the “Prorated Target Bonus.”  For purposes of this Agreement, the term
“Prorated Target Bonus” means an amount determined by multiplying the actual
percentage of the Executive’s base salary that was to be paid to the Executive
as his Target Bonus in the year in which the Change in Control Date occurs by
the Executive’s then-current Annual Base Salary as of the Date of Termination
and prorating this amount by multiplying it by a fraction, the numerator of
which is the number of days during the then-current calendar year that the
Executive was employed by the Company up to and including the Date of
Termination and the denominator of which is 365.  Payment under any
long term cash incentive plan shall be determined and governed solely by the
terms of such plan.

    

    4.2(b)                      Severance
Amount.  Within thirty (30) days after the Date of Termination,
the Company shall pay to the Executive as severance pay in a lump sum, in cash,
an amount equal to 1.5 times the sum of the Executive’s then-current Annual Base
Salary plus Target Bonus for the year in which the Change in Control Date
occurs.  Payments under any long term cash incentive plan are not part
of or included in this calculation.

    

    4.2(c)                      Stock-Based
Awards.  All stock-based awards held by the Executive will be
exercisable or vested, expire or terminate in accordance with the terms of their
respective grant agreements.

    

    4.2(d)                      Health Benefit
Continuation.  For eighteen (18) months following the Date of
Termination, the Company shall pay the COBRA premiums for the Executive and his
spouse and other eligible dependents for the medical, dental, vision and
prescription drug plan(s) maintained by the Company in which the Executive and
his spouse or other dependents were participating immediately prior to the Date
of Termination; provided, however,
that if the Executive becomes reemployed with another employer and is eligible
to receive medical or health benefits under another employer-provided plan,
program, practice or policy the Company’s COBRA premium payments benefits
described herein shall be immediately terminated upon the commencement of
coverage under the new employer’s plan, program, practice or
policy.  In addition, to the extent that the COBRA premiums paid by
the Company are taxable to the Executive, the Company shall pay to the Executive
a gross-up payment for applicable taxes.  Such payment shall be made
monthly during the period the COBRA premiums are paid by the
Company.

    

    4.2(e)                      Outplacement.  During
the twelve (12) month period following the Date of Termination, the Company
shall provide to Executive executive-level outplacement services by a vendor
selected by the Company.

    

    4.2(f)                      Gross-up
Payments.

    

    (i)           Anything
in this Agreement to the contrary notwithstanding, in the event that it shall be
determined that any payment by the Company to or for the benefit of the
Executive (whether paid or payable or distributed or distributable pursuant to
the terms of this Agreement or otherwise but determined without regard to any
additional payments required under this Section 4.2(f)) (a “Payment”) would be
subject to the excise tax imposed by Code Section 4999 (or any successor
provision) or any interest or penalties are incurred by the Executive with
respect to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the “Excise Tax”), then
the Executive shall be entitled to receive an additional payment (a “Gross-Up
Payment”) in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest or penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Executive retains an amount of the Gross-Up Payment on an after-tax basis
equal to the Excise Tax imposed upon the Payment.  Any Gross-Up
Payment required under this Section 4.2(f) shall be made on the last day of the
month in which the Executive remits such taxes to the required taxing
authority.  In no event will any such Gross-Up Payment be paid to
Executive later than the end of the Executive’s taxable year following the
Executive’s taxable year in which the related taxes are remitted to the required
taxing authority.  The intent of the parties is that the Company shall
be responsible in full for, and shall pay, any and all Excise Tax on any
Payments and Gross-up Payment(s) and any income and all excise and employment
taxes (including, without limitation, penalties and interest) imposed on any
Gross-up Payment(s) as well as any loss of deduction caused by or related to the
Gross-up Payment(s).

    

    (ii)           Subject
to the provisions of Section 4.2(f)(iii), all determinations required to be made
under this Section 4.2(f), including whether and when a Gross-up Payment is
required and the amount of such Gross-Up Payment and the assumptions to be
utilized in arriving at such determinations, shall be made by the outside
accounting firm that then audits the Company’s financial
statements  (the “Accounting Firm”), which Accounting Firm shall
provide detailed supporting calculations both to the Company and to the
Executive within fifteen (15) business days of receipt of notice from the
Company or the Executive that there has been or will be a Payment.  In
the event that the Accounting Firm is serving as the accountant or auditor for
the Person effecting the Change in Control, the Executive shall appoint another
nationally recognized accounting firm to make the determinations required
hereunder (which accounting firm shall then be referred to as the “Accounting
Firm” hereunder).  All fees and expenses of the Accounting Firm shall
be paid solely by the Company.  If the Accounting Firm determines that
no Excise Tax is payable by the Executive, it shall furnish the Executive with a
written opinion that failure to report the Excise Tax on the Executive’s
applicable federal income tax return would not result in the imposition of a
negligence or similar penalty.  Any determination by the Accounting
Firm shall be binding upon the Company and the Executive in the absence of a
material mathematical or legal error.  As a result of the uncertainty
in the application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that the Gross-Up
Payments will not have been made by the Company that should have been made or
that the Gross-Up Payments will have been made that should not have been made,
in each case consistent with the calculations required to be made
hereunder.  In the event that the Company exhausts its remedies
pursuant to Section 4.2(f)(iii) below and a payment of any Excise Tax or any
interest, penalty or addition to tax related thereto is determined to be due,
the Accounting Firm shall determine the amount of the underpayment of Excise
Taxes that has occurred and such underpayment and interest, penalty or addition
to tax shall be promptly paid by the Company to the Internal Revenue Service in
satisfaction of the Company’s original withholding obligations.  In
the event that the Accounting Firm determines that an overpayment of Gross-Up
Payment(s) has occurred, the Executive shall be responsible for the immediate
repayment to the Company of such overpayment with interest at the applicable
federal rate provided for in Section 7872(f)(2) of the Code; provided, however,
that the Executive shall have no duty or obligation whatsoever to repay such
overpayment if Executive’s receipt of the overpayment, or any portion thereof,
is included in the Executive’s income and the Executive’s repayment of the same
is not deductible by the Executive for federal or state income tax
purposes.

    

    (iii)           The
Executive shall notify the Company in writing of any claim by the Internal
Revenue Service that, if successful, would require the payment of the Excise
Tax.  Such notification shall be given as soon as practicable but no
later than ten (10) business days after the Executive is informed in writing of
such claim by the Internal Revenue Service and the notification shall apprise
the Company of the nature of the claim and the date on which such claim is
required to be paid.  The Executive shall not pay such claim prior to
the expiration of a 30-day period following the date on which the Executive has
given such notification to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such claim is
required).  If the Company notifies the Executive in writing prior to
the expiration of such period that it desires to contest such claim, the
Executive shall:

    

    (A)           give
the Company any information reasonably requested by the Company relating to such
claim;

    

    (B)           take
such action in connection with contesting such claim as the Company shall
reasonably request in writing from time to time, including without limitation,
accepting legal representation with respect to such claim by an attorney
reasonably selected by the Company;

    

    (C)           cooperate
with the Company in good faith in order to effectively contest such claim;
and

    

    (D)           permit
the Company to participate in any proceedings relating to such
claim;

    

    provided, however,
that the Company shall bear and pay all costs and expenses (including additional
interest and penalties) incurred in connection with such contest, and shall
indemnify and hold the Executive harmless, on an after-tax basis to the
Executive, for any Excise Tax or income tax (including interest and penalties
with respect thereto) imposed as a result of such contest.  Without
limitation on the foregoing provisions of this Section 4.2(f), the Company shall
control all proceedings taken in connection with such contest and, at its sole
option, may pursue or forgo any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of such claim and
may, at its sole option, either direct the Executive to pay the tax claimed and
sue for a refund or contest the claim in any permissible manner, and the
Executive agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction or in one or more
appellate courts, as the Company shall determine.

    

    4.3           Death.  If the
Executive’s employment is terminated by reason of the Executive’s death during
the Employment Period (either prior  or subsequent to a Change in
Control), this Agreement shall terminate without further obligations to the
Executive’s legal representatives under this Agreement, other than for payment
of Accrued Obligations (as defined in Section 4.1(a)) (which shall be paid to
the Executive’s estate or beneficiary, as applicable, in a lump sum in cash
within thirty (30) days of the Date of Termination) and any other benefits to
which the Executive’s beneficiaries are entitled under the terms of any of the
Company’s benefit plans or programs, including death benefits pursuant to the
terms of any plan, policy, or arrangement of the Company. Payment under any long
term cash incentive plan or other incentive compensation plan shall be
determined and governed solely by the terms of the applicable plan.

    

    4.4           Disability. If the Executive’s
employment is terminated by reason of the Executive’s Disability during the
Employment Period (either prior or subsequent to a Change in Control), this
Agreement shall terminate without further obligations to the Executive, other
than for (i) payment of Accrued Obligations (as defined in Section 4.1(a))
(which shall be paid to the Executive in a lump sum in cash within thirty (30)
days of the Date of Termination) and (ii) the timely payment or provision of any
other benefits to which the Executive is entitled under the terms of any of the
Company’s benefit plans or programs, including Disability benefits pursuant to
the terms of any plan, policy or arrangement of the Company. Payment under any
long term cash incentive plan or other incentive compensation plan shall be
determined and governed solely by the terms of the applicable plan.

    

    4.5           Termination by the Company for Cause,
Voluntary Termination by the Executive, or Untimely Termination for Good Reason
Prior to a Change in Control.  During the Employment Period, if
the Executive’s employment shall be terminated: (i) by the Company for Cause,
either prior or subsequent to a Change in Control, or (ii) voluntarily by the
Executive for any reason other than Good Reason, either prior to or subsequent
to a Change in Control, or (iii) by the Executive for Good Reason prior to a
Change in Control but after the forty-five (45) day period for such termination
as set forth in Section 4.1 of this Agreement, then this Agreement shall
terminate without further obligations to the Executive, other than for (y)
payment of the Executive’s Accrued Obligations (as defined in Section 4.1(a))
(which shall be paid to the Executive in a lump sum in cash within thirty (30)
days of the Date of Termination), and (z) the timely payment or provision of any
other benefits to which Executive is entitled under the terms of any of the
Company’s benefit plans or programs.  Payment under any long term cash
incentive plan or other incentive compensation plan shall be determined and
governed solely by the terms of the applicable plan.

    

    4.6           Non-Exclusivity of
Rights.  Except as provided in Sections 4.1(d) and 4.1(e) or
4.2(d) and 4.2(e), nothing in this Agreement shall prevent or limit the
Executive’s continuing or future participation in any plan, program, policy or
practice provided by the Company and for which the Executive may
qualify.  Amounts which are vested benefits of which the Executive is
otherwise entitled to receive under any plan, policy, practice or program of, or
any other contract or agreement with, the Company at or subsequent to the Date
of Termination, shall be payable in accordance with such plan, policy, practice
or program or contract or agreement.

    

    4.7           Full Settlement. The Company’s
obligation to make the payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action which the
Company may have against the Executive or others. In no event shall the
Executive be obligated to seek other employment or take any other action by way
of mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement and, except as provided in Sections 4.1(d) and
4.2(d), such amounts shall not be reduced whether or not the Executive obtains
other employment.  The Company agrees to pay promptly as incurred, to
the full extent permitted by law, all legal fees and expenses which the
Executive may reasonably incur as a result of any contest (regardless of the
outcome thereof) by the Company, the Executive or others of the validity or
enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof (including as a result of any contest by the
Executive regarding the amount of any payment pursuant to this Agreement), plus
in each case interest on any delayed payment at the applicable Federal rate
provided for in Code Section 7872(f)(2)(A).  Any such payment shall be
made not later than the end of the calendar year following the calendar year in
which the Executive incurred such expense.

    

    4.8           Conditions To
Payments.  To be eligible to receive (and continue to receive)
and retain the payments and benefits described in Sections 4.1(b) - (e) or
Sections 4.2(b) – (e), the Executive must comply with the terms of paragraph 5,
and must execute and deliver to the Company an agreement, in form and substance
satisfactory to the Company, effectively releasing and giving up all claims the
Executive may have against the Company and its subsidiaries, shareholders,
successors and affiliates (and each of their respective employees, officers,
plans and agents) arising out of or based upon any facts or conduct occurring
prior to that date, and reaffirming and agreeing to comply with the terms of
this Agreement and any other agreement signed by the Executive in favor of the
Company or any of its subsidiaries or affiliates. The agreement will be prepared
by the Company and provided to the Executive at the time the Executive’s
employment is terminated or as soon as administratively practicable thereafter.
The agreement also will require the Executive, among other things, to consult
with Company representatives, and voluntarily appear as a witness for trial or
deposition (and to prepare for any such testimony) in connection with, any claim
which may be asserted by or against the Company, or any business matter
concerning the Company or any of its transactions or operations. The Company
will have no obligations to make the payments and/or provide the benefits
specified in Sections 4.1(b) – (e) or Sections 4.2(b) – (e) specified above,
when applicable, unless and until the Executive signs and delivers the agreement
described in this Section 4.8 within sixty (60) days of the Date of Termination
and all conditions to the effectiveness of the release and waiver (including but
not limited to the expiration of any applicable time period to consider signing
the agreement or to revoke acceptance without any action being taken to revoke
acceptance or otherwise invalidate the agreement) have been
satisfied.

    

    4.9           Key Employee Six Month
Deferral.  Notwithstanding anything to the contrary in this
Section 4, a “Specified Employee” may not receive a payment of nonqualified
deferred compensation, as defined in Code Section 409A and the regulations
thereunder, until at least six (6) months after a Date of
Termination.  Any payment of nonqualified deferred compensation
otherwise due in such six (6) month period shall be suspended and become payable
at the end of such six (6) month period.

    

    A
“Specified Employee” means a specified employee as defined in Treas. Reg.
§1.409A-1(i) (generally, officers earning more than $140,000 per year, as
indexed for inflation, who are among the fifty (50) highest paid
employees).

    

    Section
5:                                Non-Competition.

    

    The
provisions of this Section 5 and any related provisions shall survive
termination of this Agreement and/or Executive’s employment with the Company and
do not supersede, but are in addition to and not in lieu of, any other
agreements signed by Executive concerning non competition, confidentiality,
solicitation of employees, or trade secrets (whether included in a stock option
agreement or otherwise), and are included in consideration for the Company
entering into this Agreement. Executive’s right to receive and retain the
benefits specified in Sections 4.1(b) – (e) or Sections 4.2(b) –
(e)  are conditioned upon Executive’s compliance with the terms of
this Section 5:

    

    5.1           Non-Compete
Agreement.

    

    5.1(a)                      During
the Executive’s employment with the Company and during the period beginning on
the date the Executive’s employment with the Company terminates and ending one
(1) year thereafter (i.e., on the anniversary of the date the Executive’s
employment terminates), the Executive shall not, without prior written approval
of the Company’s Chief Executive Officer, become an officer, employee, agent,
partner, or director of, or provide any services or advice to or for, any
business enterprise in substantial direct competition (as defined in Section
5.1(b)) with the Company. The above constraint shall not prevent the Executive
from making passive investments, not to exceed five percent (5%), in any
enterprise where Executive’s services or advice is not required or
provided.

    

    5.1(b)                      For
purposes of Section 5.1, a business enterprise with which the Executive becomes
associated as an officer, employee, agent, partner, or director shall be
considered in substantial direct competition, if such entity competes with the
Company in any business in which the Company or any of its direct or indirect
subsidiaries is engaged or provides services or products of a type which is
marketed, sold or provided by the Company or any of its subsidiaries or
affiliates (including but not limited to any product or service which the
Company or any such other entity is developing) within any State or country
where the Company or any such affiliate or subsidiary then provides or markets
(or plans to provide or market) any service or product as of the date the
Executive’s Company employment terminates.

    

     

    5.1(c)                      During
the Executive’s employment with the Company and during the period beginning on
the date the Executive’s employment with the Company terminates and ending one
(1) year thereafter (i.e., on the anniversary of the date the Executive’s
employment terminates), the Executive shall not, without prior written approval
of the Company’s Chief Executive Officer, directly or indirectly, solicit,
provide to, take away, or attempt to take away or provide to any customer or
solicited prospect of the Company or any of its subsidiaries any business of a
type which the Company or such subsidiary provides or markets or which is
competitive with any business then engaged in (or product or services marketed
or planned to be marketed) by the Company or any of its subsidiaries; or induce
or attempt to induce any such customer to reduce such customer’s business with
that business entity, or divert any such customer’s business from the Company
and its subsidiaries; or discuss that subject with any such
customer.

    

    5.1(d)                      During
the Executive’s employment with the Company and during the period beginning on
the date the Executive’s employment with the Company terminates and ending one
(1) year thereafter (i.e., on the first anniversary of the date Executive’s
employment terminates), the Executive shall not, without prior written approval
of the Company’s Chief Executive Officer, directly or indirectly solicit the
employment of, recruit, employ, hire, cause to be employed or hired, entice
away, or establish a business with, any then current officer, office manager,
staffing coordinator or other employee or agent of the Company or any
of  its  subsidiaries or affiliates (other than
non-supervisory or non-managerial personnel who are employed in a clerical or
maintenance position) or any other such person who was employed by the Company
or any of its subsidiaries or affiliates within the twelve (12) months
immediately prior to the date the Executive’s employment with the Company
terminated; or suggest to or discuss with any such employee the discontinuation
of that person’s status or employment with the Company or any of its
subsidiaries and affiliates, or such person’s employment or participation in any
activity in competition with the Company or any of its subsidiaries or
affiliates.

    

    5.2           Confidential
Information.  The Executive has received (and will receive)
under a relationship of trust and confidence, and shall hold in a fiduciary
capacity for the benefit of the Company, all “Confidential Information” and
secret or confidential information, knowledge or data relating to the Company or
any of its affiliated companies or direct or indirect subsidiaries, and their
respective businesses, which shall have been obtained by the Executive during
the Executive’s employment by the Company and which shall not be or become
public knowledge (other than by acts by the Executive or representatives of the
Executive in violation of this Agreement).  During the Executive’s
employment with the Company and after termination of the Executive’s employment
with the Company, the Executive shall never, without the prior written consent
of the Company, or as may otherwise be required by law or legal process, use
(other than during Executive’s employment with the Company for the benefit of
the Company), or communicate, reveal, or divulge any such information, knowledge
or data, to anyone other than the Company and those designated by
it.  In no event shall an asserted violation of the provisions of this
Section 5.2 constitute a basis for deferring or withholding any amounts
otherwise payable to the Executive under this Agreement. “Confidential
Information” means confidential and/or proprietary information and trade secrets
of or relating to the Company or any of its subsidiaries and affiliates (and
includes information the disclosure of which might be injurious to those
companies), including but not limited to information concerning personnel of the
Company or any of its subsidiaries and affiliates, confidential financial
information, customer or customer prospect information, information concerning
temporary staffing candidates, temporary employees, and personnel, temporary
employee and customer lists and data, methods and formulas for estimating costs
and setting prices, research results (such as marketing surveys, or trials),
software, programming, and programming architecture, enhancements and
developments, cost data (such as billing, equipment and programming cost
projection models), compensation information and models, business or marketing
plans or strategies, new products or marketing strategies, deal or business
terms, budgets, vendor names, programming operations, information on proposed
acquisitions or dispositions, actual performance compared to budgeted
performance, long-range plans, results of internal analyses, computer programs
and programming information, techniques and designs, business and marketing
plans, acquisition plans and strategies, divestiture plans and strategies,
internal valuations of Company assets, and trade secrets, but does not include
information generally known in the marketplace.  In addition,
Confidential Information includes information of another company given to the
Company with the understanding that it will be kept information
confidential.  All Confidential Information described herein is and
constitutes trade secret information (regardless of whether the same is legally
determined to be a trade secret) and is not the property of the
Executive.

    

    5.3           Non Disparagement. The
Executive will never criticize, denigrate, disparage, or make any derogatory
statements about the Company or its respective business plans, policies and
practices, or about any of the Company’s officers, employees or former officers
or employees, to customers, competitors, suppliers, employees, former employees,
members of the public, members of the media, or any other person; nor shall the
Executive harm or in any way adversely affect the reputation and goodwill of the
Company.  Nothing in this paragraph shall preclude or prevent the
Executive from giving truthful testimony or information to law enforcement
entities, administrative agencies or courts or in any other legal proceedings as
required by law.

    

    5.4           Provisions Relating To Non
Competition, Non Solicitation And Confidentiality.  The
provisions of this Section 5 survive the termination of Executive’s employment
and this Agreement and shall not be affected by any subsequent changes in
employment terms, positions, duties, responsibilities, authority, or employment
termination, permitted or contemplated by this Agreement.  To the
extent that any covenant set forth in this Section 5 of this Agreement shall be
determined to be invalid or unenforceable in any respect or to any extent, the
covenant shall not be void or rendered invalid, but instead shall be
automatically amended for such lesser term, to such lesser extent, or in such
other lesser degree, as will grant the Company the maximum protection and
restrictions on the Executive’s activities permitted by applicable law in such
circumstances. In cases where there is a dispute as to the right to terminate
the Executive’s employment or the basis for such termination, the term of any
covenant set forth in Section 5 shall commence as of the date specified in the
Notice of Termination and shall not be deemed to be tolled or delayed by reason
of the provisions of this Agreement. The Company shall have the right to
injunctive relief to restrain any breach or threatened breach of any provisions
in this Section 5 in addition to and not in lieu of any rights to recover
damages or cease making payments under this Agreement. The Company shall have
the right to advise any prospective or then current employer of Executive of the
provisions of this Agreement without liability. The Company’s right to enforce
the provisions of this Agreement shall not be affected by the existence, or
non-existence, of any other similar agreement for any other executive, or by the
Company’s failure to exercise any of its rights under this Agreement or any
other similar agreement or to have in effect a similar agreement for any other
employee.

     

    

    Section
6:                                Successors.

    

    6.1           Successors of Executive.  This Agreement is
personal to the Executive and, without the prior written consent of the Company,
the rights (but not the obligations) shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution.  This
Agreement shall inure to the benefit of and be enforceable by the Executive’s
legal representatives.

    

    6.2           Successors of
Company.  This Agreement is freely assignable by the Company
and its successors/assignees. The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company or the division
in which the Executive is employed, as the case may be, 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 the Executive to terminate the Agreement at his option on or after
the Change in Control Date for Good Reason.

    

    Section
7:                                Miscellaneous.

    

    7.1           Other
Agreements.  This Agreement supersedes all prior dated
agreements, letters and understandings concerning employment or severance
benefits payable to the Executive, either before or after a Change in
Control.  The Board may, from time to time in the future, provide
other incentive programs and bonus arrangements to the Executive with respect to
the occurrence of a Change in Control that will be in addition to the benefits
required to be paid in the designated circumstances in connection with the
occurrence of a Change in Control.  Such additional incentive programs
and/or bonus arrangements will affect or abrogate the benefits to be paid under
this Agreement only in the manner and to the extent explicitly agreed to by the
Executive in any such subsequent program or arrangement. This Agreement does not
supersede or affect in any way the validity of any agreement signed by Executive
concerning confidentiality, stock options, post-employment competition, non
solicitation of business, accounts or employees, or agreements of a similar type
or nature; and any provisions of this Agreement shall be in addition to and not
in lieu of (or replace) any such other agreements.

    

    7.2           Notice.  For
purposes of this Agreement, notices and all other communications provided for in
the Agreement shall be in writing and shall be deemed to have been duly given
when delivered or mailed by certified or registered mail, return receipt
requested, postage prepaid, addressed to the respective addresses as set forth
below; provided that all notices to the Company shall be directed to the
attention of the Board of Directors, or to such other address as one party may
have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon receipt.

    

    Notice to the
Executive:

    

    Patricia
M Henry

    3816
Northview Ln

    Dallas,
TX 75229

    

    Notice to the
Company:

    

    RehabCare
Group, Inc.

    7733
Forsyth Boulevard

    Suite
2300

    St.
Louis, Missouri 63105

    Att:
Board of Directors

    

    7.3           Validity.  The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this
Agreement.

    

    7.4           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.

    

    7.5           Waiver.  The
Executive’s or the Company’s failure to insist upon strict compliance with any
provision hereof or any other provision of this Agreement or the failure to
assert any right the Executive or the Company may have hereunder, shall not be
deemed to be a waiver of such provision or right or any other provision or right
of this Agreement.

    

    7.6           Section 409A
Compliance.  The parties intend that all provisions of this
Agreement comply with the requirements of Code Section 409A to the extent
applicable.  No provision of this Agreement shall be operative to the
extent that it will result in the imposition of the additional tax described in
Code Section 409A(a)(1)(B)(i)(II) and the parties agree to revise the Agreement
as necessary to comply with Section 409A and fulfill the purpose of the voided
provision.  Nothing in this Agreement shall be interpreted to permit
accelerated payment of nonqualified deferred compensation, as defined in Section
409A, or any other payment in violation of the requirements of such Code Section
409A.

    

    IN
WITNESS WHEREOF, the Executive and the Company, pursuant to the authorization
from its Board, have caused this Agreement to be executed in its name on its
behalf, all as of the day and year first above written.

    

    

    

    /s/ Patricia M.
Henry

    Patricia
M. Henry

    

    

    REHABCARE
GROUP, INC.

    

    

    By _/s/ John H.
Short__________

    John H. Short

    President and
CEOeightk1208ex104.htm

  
    
      Exhibit
10.4

      REHABCARE
GROUP, INC.

      CHANGE
IN CONTROL TERMINATION AGREEMENT

      

      

      This
agreement (“Agreement”) has been entered into as of the 8th day of December,
2008, by and between RehabCare Group, Inc., a Delaware corporation (the
“Company”), and ________________________________________, an individual (the
“Executive”).

      

      RECITALS

      

      The Board
of Directors of the Company has determined that it is in the best interests of
the Company and its stockholders to reinforce and encourage the continued
attention and dedication of the Executive to the Company as the Company’s
___________________________ and to assure that the Company will have the
continued dedication of the Executive, notwithstanding the possibility or
occurrence of a Change in Control (as defined below).  The Board
believes it is imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks created by a
potential or pending Change in Control and to encourage the Executive’s full
attention and dedication to the Company in the event of any potential or pending
Change in Control.  Therefore, in order to accomplish these
objectives, the Board has caused the Company to enter into this
Agreement.

      

      IT
IS AGREED AS FOLLOWS:

      

      Section
1:                                Definitions
and Construction.

      

      1.1                      Definitions.  For
purposes of this Agreement, the following words and phrases, whether or not
capitalized, shall have the meanings specified below, unless the context plainly
requires a different meaning.

      

      1.1(a)                      “Board” means the Board of
Directors of the Company.

      

      1.1(b)                      “Cause” means termination
based upon: (i) the Executive's willful and continued failure to
substantially perform his duties with the Company (other than as a result of
incapacity due to physical or mental condition), after a written demand for
substantial performance is delivered to the Executive by the Company, which
specifically identifies the manner in which the Executive has not substantially
performed his duties, (ii) the Executive's commission of an act
constituting a criminal offense that would be classified as a felony under the
applicable criminal code or involving moral turpitude, dishonesty, or breach of
trust, or (iii) the Executive's material breach of any provision of this
Agreement.  For purposes of this Section, no act or failure to act on
the Executive's part shall be considered "willful" unless done, or omitted to be
done, without good faith and without reasonable belief that the act or omission
was in the best interest of the Company.  Notwithstanding the
foregoing, the Executive shall not be deemed to have been terminated for Cause
unless and until (i) he receives a Notice of Termination from the Company, (ii)
he is given the opportunity, with counsel, to be heard before the Board, and
(iii) the Board finds, in its good faith opinion, that the Executive was guilty
of the conduct set forth in the Notice of Termination.

      

      1.1(c)                      “Change in Control”
means:

      

      (i)           The
acquisition by one person, or more than one person acting as a group, of
ownership of stock of the Company that, together with stock held by such person
or group, constitutes more than 50% of the total fair market value or total
voting power of the stock of the Company;

      

      (ii)           The
acquisition by one person, or more than one person acting as a group, of
ownership of stock of the Company, that together with stock of the Company
acquired during the twelve-month period ending on the date of the most recent
acquisition by such person or group, constitutes 30% or more of the total voting
power of the stock of the Company;

      

      (iii)           A
majority of the members of the Company’s board of directors is replaced during
any twelve-month period by directors whose appointment or election is not
endorsed by a majority of the members of the Company’s board of directors before
the date of the appointment or election;

      

      (iv)           One
person, or more than one person acting as a group, acquires (or has acquired
during the twelve-month period ending on the date of the most recent acquisition
by such person or group) assets from the Company that have a total gross fair
market value (determined without regard to any liabilities associated with such
assets) equal to or more than 40% of the total gross fair market value of all of
the assets of the Company immediately before such acquisition or
acquisitions.

      

      Persons
will not be considered to be acting as a group solely because they purchase or
own stock of the same corporation at the same time, or as a result of the same
public offering.  However, persons will be considered to be acting as
a group if they are owners of a corporation that enters into a merger,
consolidation, purchase or acquisition of stock, or similar business transaction
with the Company.

      

      This
definition of Change in Control shall be interpreted in accordance with, and in
a manner that will bring the definition into compliance with, the regulations
under Code Section 409A.

      

      1.1(d)                      “Change in Control Date” means
the date that the Change in Control first occurs.

      

      1.1(e)                      “Company” has the meaning set
forth in the first paragraph of this Agreement and, with regard to successors,
in Section 4.2 of this Agreement.

      

      1.1(f)                      “Code” shall mean the Internal
Revenue Code of 1986, as amended.

      

      1.1(g)                      “Date of Termination” means
the date, on or after a Change in Control Date, that Executive’s employment with
the Company terminates due to the termination of Executive’s employment by the
Company without Cause or Executive’s termination of employment with the Company
for Good Reason.  In all cases, a “Date of Termination” shall only
occur upon separation from service from the Company and all of its affiliates,
as defined in Treasury regulations under Section 409A of the Code (generally,
separation from the 50% controlled group that includes the
Company).

      

      1.1(h)                      “Effective Date” means the
date of this Agreement specified in the first paragraph of this
Agreement.

      

      1.1(i)                      “Good Reason” means
termination based upon the occurrence of one or more of the following without
the consent of the Executive: (i) a material reduction in the Executive’s
authority, duties and responsibilities; (ii) a material reduction in Executive’s
Annual Base Salary; (iii) a material reduction in the budget over which the
Executive retains authority; (iv) a material change in the primary geographic
location at which the Executive performs his duties under this Agreement; or (v)
any other action or inaction that constitutes a material breach by the Company
of any provision of this Agreement.  Any termination of the
Executive’s employment based upon a good faith determination of “Good Reason”
made by the Executive shall be subject to a delivery of a Notice of Termination
by the Executive to the Company in the manner prescribed in Section 1.1(j)
within fifteen (15) days of the first occurrence of an event that would
constitute Good Reason and subject further to the ability of the Company to
remedy within thirty (30) days of receipt of such notice any action that may
otherwise constitute Good Reason under this Section 1.1(i).

      

      1.1(j)                      “Notice of Termination” means
a written notice, given in accordance with Section 5.2, which (i) indicates the
specific termination provision in this Agreement relied upon; (ii) to the extent
applicable, sets forth in reasonable detail the facts and circumstances claimed
to be a basis for termination of the Executive’s employment under the provision
so indicated; and (iii) if the Date of Termination is other than the date of
receipt of such notice, specifies the termination date (which date shall not be
more than fifteen (15) days after the giving of such notice).

      

      1.1(k)                      “Term” means the period that
begins on the Effective Date and ends on the earlier of:

      

      (i)           the
date of Executive’s termination of employment from the Company for any reason
prior to the Change in Control Date;

      

      (ii)                      the
date of Executive’s termination of employment after a Change in Control Date for
any reason other than the involuntary termination of Executive’s employment
without Cause or the termination of employment with the Company by the Executive
for Good Reason;

      

      (iii)                      the
Date of Termination; or

      

      (iv)                      the
close of business on the later of December 31, 200___ or December 31st of any
renewal term.  This Agreement will automatically renew for annual
one-year periods unless the Company gives written notice to Executive, by
September 30, 200___, or September 30th of any
succeeding year, of the Company’s intent not to renew this
Agreement.

      

      1.2                      Gender and
Number.  When appropriate, pronouns in this Agreement used in
the masculine gender include the feminine gender, words in the singular include
the plural, and words in the plural include the singular.

      

      1.3                      Headings.  All
headings in this Agreement are included solely for ease of reference and do not
bear on the interpretation of the text.

      

      1.4                      Applicable
Law.  This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Missouri, without reference to
its conflict of law principles.

      

      Section
2:                                Change
in Control Severance Benefits

      

      2.1                      Benefits Upon a Change in
Control.  Subject to the provisions of Section 2.5, if a Change
in Control occurs during the Term and within two (2) years after the Change in
Control Date (a) the Company terminates the Executive’s employment without
Cause, or (b) the Executive terminates employment with the Company for Good
Reason, then the Executive shall become entitled to the payment of the benefits
as provided below:

      

      2.1(a)                      Accrued
Obligations.  Within thirty (30) days after the Date of
Termination, the Company shall pay to the Executive the sum of the Executive’s
accrued salary through the Date of Termination and any accrued and unused
vacation days, in each case to the extent not previously paid, and the “Prorated
Target Bonus.”  For purposes of this Agreement, the term “Prorated
Target Bonus” means an amount determined by multiplying the actual percentage of
the Executive’s base salary that was to be paid to the Executive as his Target
Bonus in the year in which the Change in Control Date occurs by the Executive’s
then-current annual base salary as of the Date of Termination and prorating this
amount by multiplying it by a fraction, the numerator of which is the number of
days during the then-current calendar year that the Executive was employed by
the Company up to and including the Date of Termination and the denominator of
which is 365.  Payment under any long-term cash incentive plan or
other incentive compensation plan shall be determined and governed solely by the
terms of the applicable plan.

      

      2.1(b)                      Severance
Amount.  Within thirty (30) days after the Date of Termination,
the Company shall pay to the Executive as severance pay in a lump sum, in cash,
an amount equal to one (1) times the sum of the Executive’s then-current annual
base salary plus Target Bonus for the year in which the Change in Control Date
occurs.  Payments under any long term cash incentive plan are not part
of or included in this calculation.  For purposes of this Agreement,
Target Bonus means the designated percentage of Executive’s target annual
incentive award, expressed as a designated percentage of Executive’s annual base
salary, as established by the Board of Directors or the Compensation and
Nomination/Corporate Governance Committee at the beginning of the year in which
the Change of Control Date occurs.

      

      2.1(c)                      Stock-Based
Awards.  All stock-based awards held by the Executive will be
exercisable or vested, expire or terminate in accordance with the terms of their
respective grant agreements.

      

      2.1(d)                      Health Benefit
Continuation.  For twelve (12) months following the Date of
Termination, the Company shall pay the COBRA premiums for the Executive and his
spouse and other eligible dependents for the medical, dental, vision, and
prescription drug plan(s) maintained by the Company in which the Executive and
his spouse or other eligible dependents were participating immediately prior to
the Date of Termination; provided, however,
that if the Executive becomes reemployed with another employer and is eligible
to receive such benefits under another employer-provided plan, program, practice
or policy the Company’s COBRA premium payments described herein shall be
immediately terminated upon the commencement of coverage under the new
employer’s plan, program, practice or policy.  In addition, to the
extent that the COBRA premiums paid by the Company are taxable to the Executive,
the Company shall pay to the Executive a gross-up payment for applicable
taxes.  Such payment shall be made monthly during the period the COBRA
premiums are paid by the Company.

      

      2.1(e)                      Outplacement.  During
the one-year period beginning on the Date of Termination, the Company shall
provide to Executive executive-level outplacement services  by a
vendor selected by the Company.

      

      2.1(f)                      Gross-up
Payments.

      

      (i)           Anything
in this Agreement to the contrary notwithstanding, in the event that it shall be
determined that any payment by the Company to or for the benefit of the
Executive (whether paid or payable or distributed or distributable pursuant to
the terms of this Agreement or otherwise but determined without regard to any
additional payments required under this Section 2.1(f)) (a “Payment”) would be
subject to the excise tax imposed by Code Section 4999 (or any successor
provision) or any interest or penalties are incurred by the Executive with
respect to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the “Excise Tax”), then
the Executive shall be entitled to receive an additional payment (a “Gross-Up
Payment”) in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest or penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Executive retains an amount of the Gross-Up Payment on an after-tax basis
equal to the Excise Tax imposed upon the Payment.  Any Gross-Up
Payment required under this Section 2.1(f) shall be made on the last day of the
month in which the Executive remits such taxes to the required taxing
authority.  In no event will any such Gross-Up Payment be paid to
Executive later than the end of the Executive’s taxable year following the
Executive’s taxable year in which the related taxes are remitted to the required
taxing authority.  The intent of the parties is that the Company shall
be responsible in full for, and shall pay, any and all Excise Tax on any
Payments and Gross-up Payment(s) and any income and all excise and employment
taxes (including, without limitation, penalties and interest) imposed on any
Gross-up Payment(s) as well as any loss of deduction caused by or related to the
Gross-up Payment(s).

      

      (ii)                      Subject
to the provisions of Section 2.1(f)(iii), all determinations required to be made
under this Section 2.1(f), including whether and when a Gross-up Payment is
required and the amount of such Gross-Up Payment and the assumptions to be
utilized in arriving at such determinations, shall be made by the outside
accounting firm that then audits the Company’s financial
statements  (the “Accounting Firm”), which Accounting Firm shall
provide detailed supporting calculations both to the Company and to the
Executive within fifteen (15) business days of receipt of notice from the
Company or the Executive that there has been or will be a Payment.  In
the event that the Accounting Firm is serving as the accountant or auditor for
the person effecting the Change in Control, the Executive shall appoint another
nationally recognized accounting firm to make the determinations required
hereunder (which accounting firm shall then be referred to as the “Accounting
Firm” hereunder).  All fees and expenses of the Accounting Firm shall
be paid solely by the Company.  If the Accounting Firm determines that
no Excise Tax is payable by the Executive, it shall furnish the Executive with a
written opinion that failure to report the Excise Tax on the Executive’s
applicable federal income tax return would not result in the imposition of a
negligence or similar penalty.  Any determination by the Accounting
Firm shall be binding upon the Company and the Executive in the absence of a
material mathematical or legal error.  As a result of the uncertainty
in the application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that the Gross-Up
Payments will not have been made by the Company that should have been made or
that the Gross-Up Payments will have been made that should not have been made,
in each case consistent with the calculations required to be made
hereunder.  In the event that the Company exhausts its remedies
pursuant to Section 2.1(f)(iii) below and a payment of any Excise Tax or any
interest, penalty or addition to tax related thereto is determined to be due,
the Accounting Firm shall determine the amount of the underpayment of Excise
Taxes that has occurred and such underpayment and interest, penalty or addition
to tax shall be promptly paid by the Company to the Internal Revenue Service in
satisfaction of the Company’s original withholding obligations.  In
the event that the Accounting Firm determines that an overpayment of Gross-Up
Payment(s) has occurred, the Executive shall be responsible for the immediate
repayment to the Company of such overpayment with interest at the applicable
federal rate provided for in Section 7872(f)(2) of the Code; provided, however,
that the Executive shall have no duty or obligation whatsoever to repay such
overpayment if Executive’s receipt of the overpayment, or any portion thereof,
is included in the Executive’s income and the Executive’s repayment of the same
is not deductible by the Executive for federal or state income tax
purposes.

      

      (iii)                      The
Executive shall notify the Company in writing of any claim by the Internal
Revenue Service that, if successful, would require the payment of the Excise
Tax.  Such notification shall be given as soon as practicable but no
later than ten (10) business days after the Executive is informed in writing of
such claim by the Internal Revenue Service and the notification shall apprise
the Company of the nature of the claim and the date on which such claim is
required to be paid.  The Executive shall not pay such claim prior to
the expiration of a 30-day period following the date on which the Executive has
given such notification to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such claim is
required).  If the Company notifies the Executive in writing prior to
the expiration of such period that it desires to contest such claim, the
Executive shall:

      

      (A)                      give
the Company any information reasonably requested by the Company relating to such
claim;

      

      (B)                      take
such action in connection with contesting such claim as the Company shall
reasonably request in writing from time to time, including without limitation,
accepting legal representation with respect to such claim by an attorney
reasonably selected by the Company;

      

      (C)                      
cooperate with the Company in good faith in order to effectively contest such
claim; and

      

      (D)                      permit
the Company to participate in any proceedings relating to such
claim;

      

      provided, however,
that the Company shall bear and pay all costs and expenses (including additional
interest and penalties) incurred in connection with such contest, and shall
indemnify and hold the Executive harmless, on an after-tax basis to the
Executive, for any Excise Tax or income tax (including interest and penalties
with respect thereto) imposed as a result of such contest.  Without
limitation on the foregoing provisions of this Section 2.1(f), the Company shall
control all proceedings taken in connection with such contest and, at its sole
option, may pursue or forgo any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of such claim and
may, at its sole option, either direct the Executive to pay the tax claimed and
sue for a refund or contest the claim in any permissible manner, and the
Executive agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction or in one or more
appellate courts, as the Company shall determine.

      

      2.2                      Non-Exclusivity of
Rights.  Except as provided in Sections 2.1(d) or 2.1(e),
nothing in this Agreement shall prevent or limit the Executive’s continuing or
future participation in any plan, program, policy or practice provided by the
Company and for which the Executive may qualify.  Amounts which are
vested benefits of which the Executive is otherwise entitled to receive under
any plan, policy, practice or program of, or any other contract or agreement
with, the Company at or subsequent to the Date of Termination, shall be payable
in accordance with such plan, policy, practice or program or contract or
agreement.

      

      2.3                      Full Settlement. The Company’s
obligation to make the payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action which the
Company may have against the Executive or others. In no event shall the
Executive be obligated to seek other employment or take any other action by way
of mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement and, except as provided in Section 2.1(d), such
amounts shall not be reduced whether or not the Executive obtains other
employment.  The Company agrees to pay promptly as incurred, to the
full extent permitted by law, all legal fees and expenses which the Executive
may reasonably incur as a result of any contest (regardless of the outcome
thereof) by the Company, the Executive or others of the validity or
enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof (including as a result of any contest by the
Executive regarding the amount of any payment pursuant to this Agreement), plus
in each case interest on any delayed payment at the applicable Federal rate
provided for in Code Section 7872(f)(2)(A).  Any such payment shall be
made not later than the end of the calendar year following the calendar year in
which the Executive incurred such expense.

      

      2.4                      Conditions To
Payments.  To be eligible to receive (and continue to receive)
and retain the payments and benefits described in Section 2, the Executive must
comply with the terms of Section 3, and must execute and deliver to the Company
an agreement, in form and substance satisfactory to the Company, effectively
releasing and giving up all claims the Executive may have against the Company
and its subsidiaries, shareholders, successors and affiliates (and each of their
respective employees, officers, plans and agents) arising out of or based upon
any facts or conduct occurring prior to that date, and reaffirming and agreeing
to comply with the terms of this Agreement and any other agreement signed by the
Executive in favor of the Company or any of its subsidiaries or affiliates. The
agreement will be prepared by the Company and provided to the Executive at the
time the Executive’s employment is terminated or as soon as administratively
practicable thereafter.  The Company will have no obligations to make
the payments and/or provide the benefits specified in Section 2, unless and
until the Executive signs and delivers the agreement described in this Section
2.4 within sixty (60) days of the Date of Termination and all conditions to the
effectiveness of the release and waiver (including but not limited to the
expiration of any applicable time period to consider signing the agreement or to
revoke acceptance without any action being taken to revoke acceptance or
otherwise invalidate the agreement) have been satisfied.

      

      2.5                      Key Employee Six Month
Deferral.  Notwithstanding anything to the contrary in this
Section 2, a “Specified Employee” may not receive a payment of nonqualified
deferred compensation, as defined in Code Section 409A and the regulations
thereunder, until at least six (6) months after a Date of
Termination.  Any payment of nonqualified  deferred
compensation otherwise due in such six (6) month period shall be suspended and
become payable at the end of such six (6) month period.

      

      A
“Specified Employee” means a specified employee as defined in in Treas. Reg.
§1.409A-1(i) (generally, officers earning more than $140,000 per year, as
indexed for inflation, who are among the fifty (50) highest paid
employees).

      

      Section
3:                                Non-Competition.

      

      The
provisions of this Section 3 and any related provisions shall survive
termination of this Agreement and/or Executive’s employment with the Company and
do not supersede, but are in addition to and not in lieu of, any other
agreements signed by Executive concerning non competition, confidentiality,
solicitation of employees, or trade secrets (whether included in a stock option
agreement or otherwise), and are included in consideration for the Company
entering into this Agreement. Executive’s right to receive and retain the
benefits specified in Section 2 are conditioned upon Executive’s compliance with
the terms of this Section 3:

      

      3.1                      Non-Compete
Agreement.

      

      3.1(a)                      During
the Executive’s employment with the Company and during the period beginning on
the date the Executive’s employment with the Company terminates and ending one
(1) year thereafter (i.e., on the anniversary of the date the Executive’s
employment terminates), the Executive shall not, without prior written approval
of the Company’s Chief Executive Officer, become an officer, employee, agent,
partner, or director of, or provide any services or advice to or for, any
business enterprise in substantial direct competition (as defined in Section
3.1(b)) with the Company. The above constraint shall not prevent the Executive
from making passive investments, not to exceed five percent (5%), in any
enterprise where Executive’s services or advice is not required or
provided.

      

      3.1(b)                      For
purposes of Section 3.1(a), a business enterprise with which the Executive
becomes associated as an officer, employee, agent, partner, or director shall be
considered in substantial direct competition, if such entity competes with the
Company in any business in which the Company or any of its direct or indirect
subsidiaries is engaged or provides services or products of a type which is
marketed, sold or provided by the Company or any of its subsidiaries or
affiliates (including but not limited to any product or service which the
Company or any such other entity is developing) within any State or country
where the Company or any such affiliate or subsidiary then provides or markets
(or plans to provide or market) any service or product as of the date the
Executive’s Company employment terminates.

      

      3.1(c)                      During
the Executive’s employment with the Company and during the period beginning on
the date the Executive’s employment with the Company terminates and ending one
(1) year thereafter (i.e., on the anniversary of the date the Executive’s
employment terminates), the Executive shall not, without prior written approval
of the Company’s Chief Executive Officer, directly or indirectly, solicit,
provide to, take away, or attempt to take away or provide to any customer or
solicited prospect of the Company or any of its subsidiaries any business of a
type which the Company or such subsidiary provides or markets or which is
competitive with any business then engaged in (or product or services marketed
or planned to be marketed) by the Company or any of its subsidiaries; or induce
or attempt to induce any such customer to reduce such customer’s business with
that business entity, or divert any such customer’s business from the Company
and its subsidiaries; or discuss that subject with any such
customer.

      

      3.1(d)                      During
the Executive’s employment with the Company and during the period beginning on
the date the Executive’s employment with the Company terminates and ending one
(1) year thereafter (i.e., on the anniversary of the date the Executive’s
employment terminates), the Executive shall not, without prior written approval
of the Company’s Chief Executive Officer, directly or indirectly solicit the
employment of, recruit, employ, hire, cause to be employed or hired, entice
away, or establish a business with, any then current officer, office manager,
staffing coordinator or other employee or agent of the Company or any
of  its  subsidiaries or affiliates (other than
non-supervisory or non-managerial personnel who are employed in a clerical or
maintenance position) or any other such person who was employed by the Company
or any of its subsidiaries or affiliates within the twelve (12) months
immediately prior to the date the Executive’s employment with the Company
terminated; or suggest to or discuss with any such employee the discontinuation
of that person’s status or employment with the Company or any of its
subsidiaries and affiliates, or such person’s employment or participation in any
activity in competition with the Company or any of its subsidiaries or
affiliates.

      

      3.2                      Confidential
Information.  The Executive has received (and will receive)
under a relationship of trust and confidence, and shall hold in a fiduciary
capacity for the benefit of the Company, all “Confidential Information” and
secret or confidential information, knowledge or data relating to the Company or
any of its affiliated companies or direct or indirect subsidiaries, and their
respective businesses, which shall have been obtained by the Executive during
the Executive’s employment by the Company and which shall not be or become
public knowledge (other than by acts by the Executive or representatives of the
Executive in violation of this Agreement).  During the Executive’s
employment with the Company and after termination of the Executive’s employment
with the Company, the Executive shall never, without the prior written consent
of the Company, or as may otherwise be required by law or legal process, use
(other than during Executive’s employment with the Company for the benefit of
the Company), or communicate, reveal, or divulge any such information, knowledge
or data, to anyone other than the Company and those designated by
it.  In no event shall an asserted violation of the provisions of this
Section 3.2 constitute a basis for deferring or withholding any amounts
otherwise payable to the Executive under this Agreement. “Confidential
Information” means confidential and/or proprietary information and trade secrets
of or relating to the Company or any of its subsidiaries and affiliates (and
includes information the disclosure of which might be injurious to those
companies), including but not limited to information concerning personnel of the
Company or any of its subsidiaries and affiliates, confidential financial
information, customer or customer prospect information, information concerning
temporary staffing candidates, temporary employees, and personnel, temporary
employee and customer lists and data, methods and formulas for estimating costs
and setting prices, research results (such as marketing surveys, or trials),
software, programming, and programming architecture, enhancements and
developments, cost data (such as billing, equipment and programming cost
projection models), compensation information and models, business or marketing
plans or strategies, new products or marketing strategies, deal or business
terms, budgets, vendor names, programming operations, information on proposed
acquisitions or dispositions, actual performance compared to budgeted
performance, long-range plans, results of internal analyses, computer programs
and programming information, techniques and designs, business and marketing
plans, acquisition plans and strategies, divestiture plans and strategies,
internal valuations of Company assets, and trade secrets, but does not include
information generally known in the marketplace.  In addition,
Confidential Information includes information of another company given to the
Company with the understanding that it will be kept information
confidential.  All Confidential Information described herein is and
constitutes trade secret information (regardless of whether the same is legally
determined to be a trade secret) and is not the property of the
Executive.

      

      3.3                      Non Disparagement. The
Executive will never criticize, denigrate, disparage, or make any derogatory
statements about the Company or its respective business plans, policies and
practices, or about any of the Company’s officers, employees or former officers
or employees, to customers, competitors, suppliers, employees, former employees,
members of the public, members of the media, or any other person; nor shall the
Executive harm or in any way adversely affect the reputation and goodwill of the
Company.  Nothing in this paragraph shall preclude or prevent the
Executive from giving truthful testimony or information to law enforcement
entities, administrative agencies or courts or in any other legal proceedings as
required by law.

      

      3.4                      Provisions Relating To Non
Competition, Non Solicitation And Confidentiality.  The
provisions of this Section 3 survive the termination of Executive’s employment
and this Agreement and shall not be affected by any subsequent changes in
employment terms, positions, duties, responsibilities, authority, or employment
termination, permitted or contemplated by this Agreement.  To the
extent that any covenant set forth in this Section 3 of this Agreement shall be
determined to be invalid or unenforceable in any respect or to any extent, the
covenant shall not be void or rendered invalid, but instead shall be
automatically amended for such lesser term, to such lesser extent, or in such
other lesser degree, as will grant the Company the maximum protection and
restrictions on the Executive’s activities permitted by applicable law in such
circumstances. In cases where there is a dispute as to the right to terminate
the Executive’s employment or the basis for such termination, the term of any
covenant set forth in Section 3 shall commence as of the date specified in the
Notice of Termination and shall not be deemed to be tolled or delayed by reason
of the provisions of this Agreement. The Company shall have the right to
injunctive relief to restrain any breach or threatened breach of any provisions
in this Section 3 in addition to and not in lieu of any rights to recover
damages or cease making payments under this Agreement.  The Company
shall have the right to advise any prospective or then current employer of
Executive of the provisions of this Agreement without liability. The Company’s
right to enforce the provisions of this Agreement shall not be affected by the
existence, or non-existence, of any other similar agreement for any other
executive, or by the Company’s failure to exercise any of its rights under this
Agreement or any other similar agreement or to have in effect a similar
agreement for any other employee.

      

      Section
4:                                Successors.

      

      4.1                      Successors of Executive.  This Agreement is
personal to the Executive and, without the prior written consent of the Company,
the rights (but not the obligations) shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution.  This
Agreement shall inure to the benefit of and be enforceable by the Executive’s
legal representatives.

      

      4.2                      Successors of
Company.  This Agreement is freely assignable by the Company
and its successors/assignees. The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company or the division
in which the Executive is employed, as the case may be, 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 the Executive to terminate the Agreement at his option on or after
the Change in Control Date for Good Reason.

      

      Section
5:                                Miscellaneous.

      

      5.1                      Other
Agreements.  This Agreement supersedes all prior dated
agreements, letters and understandings concerning severance benefits payable to
the Executive after a Change in Control.  The Board may, from time to
time in the future, provide other incentive programs and bonus arrangements to
the Executive with respect to the occurrence of a Change in Control that will be
in addition to the benefits required to be paid in the designated circumstances
in connection with the occurrence of a Change in Control.  Such
additional incentive programs and/or bonus arrangements will affect or abrogate
the benefits to be paid under this Agreement only in the manner and to the
extent explicitly agreed to by the Executive in any such subsequent program or
arrangement. This Agreement does not supersede or affect in any way the validity
of any agreement signed by Executive concerning confidentiality, stock options,
post-employment competition, non solicitation of business, accounts or
employees, or agreements of a similar type or nature; and any provisions of this
Agreement shall be in addition to and not in lieu of (or replace) any such other
agreements.

      

      5.2                      Notice.  For
purposes of this Agreement, notices and all other communications provided for in
the Agreement shall be in writing and shall be deemed to have been duly given
when delivered or mailed by certified or registered mail, return receipt
requested, postage prepaid, addressed to the respective addresses as set forth
below; provided that all notices to the Company shall be directed to the
attention of the Board of Directors, or to such other address as one party may
have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon receipt.

      

      Notice to the
Executive:

      

      _____________________

      [Address
of Notice]

      

      Notice to the
Company:

      

      RehabCare
Group, Inc.

      7733
Forsyth Boulevard, Suite 2300

      St.
Louis, Missouri 63105

      Att:
Board of Directors

      

      5.3                      Validity.  The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this
Agreement.

      

      5.4                      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.

      

      5.5                      Waiver.  The
Executive’s or the Company’s failure to insist upon strict compliance with any
provision hereof or any other provision of this Agreement or the failure to
assert any right the Executive or the Company may have hereunder, shall not be
deemed to be a waiver of such provision or right or any other provision or right
of this Agreement.

      

      5.6                      Section 409A
Compliance.  The parties intend that all provisions of this
Agreement comply with the requirements of Code Section 409A to the extent
applicable.  No provision of this Agreement shall be operative to the
extent that it will result in the imposition of the additional tax described in
Code Section 409A(a)(1)(B)(i)(II) and the parties agree to revise the Agreement
as necessary to comply with Section 409A and fulfill the purpose of the voided
provision.  Nothing in this Agreement shall be interpreted to permit
accelerated payment of nonqualified deferred compensation, as defined in Section
409A, or any other payment in violation of the requirements of such Code Section
409A.

      

      

      IN
WITNESS WHEREOF, the Executive and the Company, pursuant to the authorization
from its Board, have caused this Agreement to be executed in its name on its
behalf, all as of the day and year first above written.

      

      

      

      

      _______________________________________

      [Name
of Executive]

      

      

      REHABCARE
GROUP, INC.

      

      

      By:           __________________________________

      Name:  John H.
Short

      Title:  President and
CEO

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