Document:

exv10w21

 

EXHIBIT 10.21

EMPLOYMENT AGREEMENT

     This Employment Agreement (“Agreement”) is effective as of the 1st day of January
1, 2008, by and between Mark Thierer (“Executive”) and SXC Health Solutions Corporation and its
subsidiary, SXC Health Solutions, Inc. (collectively, the “Company”).

RECITALS

     A. The Company wishes to continue to employ Executive under the terms and conditions set forth
in this Agreement and Executive wishes to continue to be employed by the Company under the terms
and conditions set forth in this Agreement.

     B. Executive and the Company previously entered into an Employment Agreement, effective August
24, 2006 (the “Original Agreement”). The Original Agreement contained substantially identical
post-employment confidentiality and noncompetition obligations as this Agreement. Executive
acknowledged in the Original Agreement that his covenants to the Company, including his
post-employment obligations, were made in partial consideration of the Company’s grant of stock options
to purchase 250,000 shares of the common stock of the Company. The parties have entered into this
Agreement because of their mutual desire to alter certain terms of the Original Agreement.

     C. Executive acknowledges that as a member of the Company’s senior management team (“Senior
Executive Team”), he is one of the persons charged with responsibility for the implementation of
the Company’s business plans, and that Executive is one of only a few employees who will have
regular and complete access to various confidential and/or proprietary information relating to the
Company. Further, Executive acknowledges that his covenants to the Company hereinafter set forth,
specifically including but not limited to his covenant not to engage in competition with the
Company, are being made in partial consideration of the Company’s willingness to continue to employ
Executive under the terms and conditions set forth in this Agreement. As a condition of that
employment, the Company requires that this Agreement be entered into pursuant to which Executive
furnishes the Company with, among other things, certain covenants of Executive, including
Executive’s covenant not to compete with the businesses of the Company for a reasonable period of
time.

AGREEMENT

     NOW, THEREFORE, in consideration of the foregoing recitals, and the mutual agreements
herein contained and other good and valuable consideration, the receipt and sufficiency of
which are hereby mutually acknowledged, the parties hereby agree as follows:

ARTICLE I

EMPLOYMENT RELATIONSHIP

     1.1 Employment. Subject to the terms and conditions of this Agreement, the Company
hereby agrees to continue to employ Executive to serve as the Company’s President and Chief
Operating Officer, and Executive hereby accepts such continued employment, and agrees to perform
his duties and responsibilities to the best of his abilities in a diligent, trustworthy,
businesslike and efficient manner.

     1.2 Duties. The Executive shall continue to be the Company’s President and Chief
Operating Officer, and shall continue to participate as a member of the Company’s Senior Executive
Team. In addition, Executive shall be responsible for, among other things, the oversight of all of
the Company’s operations, business development, product development and information technology
operations, and such other duties as may be reasonably requested by the Company. Executive shall
report to the Company’s

 

 

Chief Executive Officer. Executive shall perform his duties under this Agreement at the Company’s
facilities in Lisle, Illinois or any subsequent location of the Company’s primary administrative
operations.

     1.3 Officer Position/Resignation of Board Membership. Executive is an officer of the
Company and may be elected to the Company’s Board of Directors. Executive shall resign his position
as an officer of the Company and membership on the Company’s Board of Directors if his employment
with the Company terminates for any reason, with his resignation being effective no later than the
effective date of the termination of his employment.

     1.4 Exclusive Employment. While employed by the Company hereunder, Executive covenants
to the Company that he will devote his entire business time, energy, attention and skill to the
Company (except for permitted vacation periods and reasonable periods of illness or other
incapacity), and use his good faith best efforts to promote the interests of the Company. The
foregoing shall not be construed as prohibiting Executive from spending such time as may be
reasonably necessary to attend to his personal affairs and investments so long as such activities
do not conflict or interfere with Executive’s obligations and/or timely performance of his duties
to the Company.

     1.5 Executive Representations and Warranties as to Employability. Executive
hereby represents and warrants to the Company that:

     (a) The execution, delivery and performance by Executive of this Agreement and any
other agreements contemplated hereby to which Executive is a party do not and shall not
conflict with, breach, violate or cause a default under any contract, agreement, instrument,
order, judgment or decree to which Executive is a party or by which he is bound;

     (b) Executive is not a party to or bound by any employment agreement, non-competition
agreement or confidentiality agreement with any other person or entity (or if a party to
such an agreement, Executive has disclosed the material terms thereof to the Board prior to
the execution hereof and promptly after the date hereof shall deliver a copy of such
agreement to the Board);

     (c) Upon the execution and delivery of this Agreement by the Company, this Agreement
shall be the valid and binding obligation of Executive, enforceable in accordance with its
terms; and

     (d) Executive hereby acknowledges and represents that he has been given the
opportunity to consult with independent legal counsel regarding Executive’s rights and
obligations under this Agreement and that he fully understands the terms and conditions
contained herein.

ARTICLE II

PERIOD OF EMPLOYMENT

     2.1 Employment Period. Executive’s employment hereunder shall commence on January 1,
2008, and shall continue hereunder until the date fixed by the provisions of Section 2.2 hereof,
subject to the early termination provisions of Article V hereof (the “Employment Period”).

     2.2 Initial Term of Employment Period and Extension Terms. The Employment Period shall
initially continue for a term commencing on the date set forth in Section 2.1, above, and ending on
December 31, 2009 (the “Initial Term”). The Employment Period shall be automatically extended for
successive one (1) calendar year periods following the expiration of the Initial Term (each period
being

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hereinafter referred to as an “Extension Term”) upon the same terms conditions provided for
herein unless either party provides the other party with advance written notice of its or
Executive’s intention not to extend the Employment Period; provided, however, that such notice must
be delivered by the non-extending party to the other party not later than sixty (60) days prior to
the expiration of the Initial Term or any Extension Term, as the case may be. If the Employment
Period is not extended as a result of notice to Executive by the Company, and Executive’s
employment with the Company terminates as a result thereof, then Executive’s termination shall be a
treated as a Termination by the Company Without Cause.

ARTICLE III

COMPENSATION

     3.1 Annual Base Compensation. During the Employment Period the Company shall pay to
Executive an annual base salary (the “Annual Base Compensation”) in the amount of Two Hundred
Eighty Thousand and 00/100 Dollars ($280,000.00). The Annual Base Compensation shall be paid in
regular installments in accordance with the Company’s regular payroll practices, and shall be
subject to all required federal, state and local withholding taxes. Executive’s Annual Base
Compensation shall be reviewed annually by the Company’s Chief Executive Officer and/or the
Compensation Committee of the Company’s Board of Directors who shall make a recommendation for
approval by the Company’s Board of Directors.

     3.2 Executive Performance Bonus. In respect of each calendar year falling within the
Employment Period, Executive shall be eligible to earn an incentive compensation bonus, depending
upon the achievement of the Company’s and Executive’s performance objectives (the “Incentive
Compensation Bonus”). The amount of the Incentive Compensation Bonus shall be targeted at eighty
percent (80%) of the Executive’s Annual Base Compensation, with the specific percentage determined
by the Company’s Board of Directors after the close of the Company’s fiscal year (December 31). The
Incentive Compensation Bonus, if any, shall be paid to Executive at the same time other members of
the Senior Executive Team are paid their respective incentive compensation bonuses. If Executive is
terminated for Cause, then no Incentive Compensation Bonus shall be paid to Executive for the
calendar year in which the termination occurred. If Executive’s employment terminates during the
calendar year for reasons other than Cause, then Executive shall receive a pro rata amount of the
Incentive Compensation Bonus that Executive would have received if Executive remained employed
throughout the calendar year. To the extent practicable, the Company will notify Executive of
Executive’s performance objectives for the year in January of that year.

     3.3 Expenses. During the Employment Period, Executive shall be entitled to
reimbursement of all business expenses reasonably incurred in the performance of Executive’s duties
for the Company, including reasonable travel-related expenses, upon submission of all receipts and
accounts with respect thereto, and approval by the Company thereof, in accordance with the then
current business expense reimbursement policies of the Company.

     3.4 Vacation. Executive shall be entitled to accrue over the course of the calendar
year paid vacation time in accordance with the Company’s then current vacation policy.

     3.5 Insurance. The Company shall provide Executive with the following insurance
benefits
during the Employment Period:

     a. Dental, vision and supplemental health insurance commencing on your date of
employment with the Company in accordance with the terms and conditions of the applicable
plans and Company policies then in effect.

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     b. A term life insurance policy with a death benefit in the amount of 2.5 times
Executive’s Annual Base Compensation in accordance with the applicable plans and Company
policies then in effect, subject to a maximum death benefit of $500,000.00.

     c. Additional Executive Group Life Insurance in the amount of $500,000.00 (contingent
upon insurance company approval) beginning on the first of the month following one month of
employment.

     d. Accidental death and dismemberment insurance commencing upon the date of your
employment with the Company in accordance with the applicable plans and Company policies
then in effect.

     e. Short and long-term disability insurance commencing upon the date of your employment
with the Company in accordance with the applicable plans and Company policies then in
effect.

     3.6 Retirement Plan. Executive shall continue to be eligible to participate in the
Company’s deferred compensation plans, including its 401(k) plan.

     3.7 Grant of Stock Options/Existing Stock.

     a. Upon the commencement of the Initial Term of the Original Agreement,
Executive was granted options (“Options”) to purchase 250,000 shares of common stock of the
Company at an exercise price equal to the closing price of the Company’s common stock on the
date the Initial Term commenced. The Options are subject to the Company’s Stock Option Plan
then in operation at the time of their purchase. One hundred thousand of the Options (the
“Guaranteed Options”) began vesting in one-third increments annually, commencing on December
31, 2006. The remaining 150,000 Options (the “Contingent Options”) shall vest, in their
entirety, upon Executive being appointed the Company’s Chief Executive Officer (provided,
Executive accepts appointment as the Company’s Chief Executive Officer). For clarification,
the Contingent Options shall not vest if Executive is not appointed the Company’s Chief
Executive Officer (or Executive declines appointment as the Company’s Chief Executive
Officer) except as otherwise provided in this Agreement.

     c. Except as otherwise provided in section 5.2(g) of this Agreement, once vested, the
Options shall have a five (5) year life.

     d. Upon a Change of Control (defined below), all of the Guaranteed Options and
Contingent Options shall vest.

     e. Upon either Executive’s Resignation for Good Reason (defined below) or
Executive’s employment terminates through a Termination by the Company Without Cause
(defined below), then the Guaranteed Options shall vest on the following basis:

	 	 	 
	Date of Termination	 	Cumulative Percentage Vested
	Prior to December 31, 2009
	 	66.67%
	 
	On or after December 31, 2009
	 	100.00%

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     f. Executive acknowledges that immediately prior to his employment with the
Company, he held common stock of the Company (the “Preexisting Shares”). Executive agrees
that he will not sell or otherwise dispose of his Preexisting Shares during the Initial Term
or any Extension Term without the written consent of the Compensation Committee of the
Company’s Board of Directors.

     3.8 Stock Option Plan. Executive shall be permitted to participate in the Company’s
Stock Option Plan in the same manner as the Company’s other Senior Executive Team members, with
future annual grants based on Executive’s performance as determined by the Company’s Chief
Executive Officer.

     3.9
Other Fringe Benefits. During the Employment Period, Executive shall be
entitled to receive such of the Company’s other fringe benefits as are being provided to other
Executives of the Company on the Senior Executive Team.

     3.10 Vehicle Allowance. Executive shall receive a monthly payment of Five Hundred and
00/100 Dollars ($500.00) for Executive’s use of a personal automobile for business use (“Vehicle
Allowance”). The Vehicle Allowance shall be subject to all required federal, state and local
withholding.

ARTICLE IV

COVENANTS OF EXECUTIVE

     4.1 Covenants Regarding Developments. Executive agrees as follows with regard
to any developments that relate to the Company’s business or Confidential and Proprietary
Information (defined below), or that Executive conceives, makes, develops or acquires, including,
but not limited to, any trade secrets, discoveries, inventions, improvements, ideas, programs,
formulas, diagrams, designs, plans and drawings, whether or not reduced to writing, patented,
copyrighted or trademarked (“Developments”):

     (a) Executive shall promptly and fully disclose all Developments to the Company, and
shall prepare, maintain, and make available to the Company adequate and current written
records of such Developments and all modifications, research, and studies made or undertaken
by Executive with respect thereto.

     (b) All Developments and related records shall become and remain the exclusive property
of the Company and, to the extent Executive has any rights thereto, Executive hereby assigns
all such rights, title, and interest to the Company.

     (c) Upon request by the Company, Executive, at any time, whether during or after
Executive’s employment by the Company, shall execute, acknowledge and deliver to the Company
all assignments and other documents which the Company deems necessary or desirable to: (i)
vest the Company with full and exclusive right, title, and interest to such Developments,
and (ii) enable the Company to file and prosecute an application for, or acquire, maintain
or enforce, all letters of patent, trademark registrations, and copyrights covering such
Developments.

     (d) The foregoing provisions regarding assignments do not apply to any Developments for
which no equipment, supplies, facility or trade secret information of the Company was used,
and which were developed entirely on Executive’s own time, unless the Developments: (i)
relate to the Company’s business or to its actual or demonstrably anticipated research or
development, or (ii) result from any work performed by Executive for the Company.

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     4.2 Ownership and Covenant to Return Documents, etc. Executive agrees that all Company
work product and all documents or other tangible materials (whether originals, copies or
abstracts), including without limitation, price lists, quotation guides, outstanding quotations,
books, records, manuals, files, sales literature, training materials, customer records,
correspondence, computer disks or print-out documents, contracts, orders, messages, phone and
address lists, invoices and receipts, and all objects associated therewith, which in any way relate
to the business or affairs of the Company either furnished to Executive by the Company or are
prepared, compiled or otherwise acquired by Executive during the Employment Period, shall be the
sole and exclusive property of the Company. Executive shall not, except for the use of the Company,
use, copy or duplicate any of the aforementioned documents or objects, nor remove them from the
facilities of the Company, nor use any information concerning them except for the benefit of the
Company, either during the Employment Period or thereafter. Executive agrees that he will deliver
all of the aforementioned documents and objects that may be in his possession to the Company on the
termination of his employment with the Company, or at any other time upon the Company’s request.

     4.3 Nondisclosure Covenant. Executive recognizes that by virtue of Executive’s
employment with the Company, Executive will be granted otherwise prohibited access to trade secrets
and other confidential and proprietary information that is not known to its competitors or within
the industry generally, that was developed by the Company over a long period of time and/or at
substantial expense, and which is confidential in nature or otherwise of great competitive value to
the Company. This information (“Confidential and Proprietary Information”) includes, but is not
limited to, the Company’s trade secrets; information relating to the Company’s production practices
and methods of doing business; sales, marketing, and service strategies, programs, and procedures;
contract expiration dates, customers and prospective customers, including, but not limited to,
their particularized requirements and preferences, and the identity, authority, and
responsibilities of their key contact persons; payment methods; service and product costs; pricing
structures and incentive plans; vendors; financial position and business plans; computer programs
and databases; research projects; new product and service developments; and any other information
of the Company or any of its vendors or customers that the Company informs Executive, or which
Executive should know by virtue of his position or the circumstances in which he learned it, is to
be kept confidential. Confidential and Proprietary Information does not include information that is
(i) in the public domain (except as a result of a breach of this Agreement or Executive’s
obligations under a statutory or common law obligation) or (ii) obtained by Executive from a third
party subsequent to the termination of Executive’s employment with the Company (except where the
third party obtains the information in violation of a contractual obligation, a statutory or common
law obligation). Executive agrees that during the Employment Period and at all times thereafter (a)
Executive will not disclose, use or permit others to use any Confidential and Proprietary
Information, or otherwise make use of any of it for his own purposes or the purposes of another,
except as required in the course of his employment for the benefit of the Company or as required by
law, and (b) Executive will take all reasonable measures, in accordance with the Company’s
policies, procedures, and instructions, to protect the Confidential and Proprietary Information
from any accidental or unauthorized disclosure or use.

     4.4 Noninterference Covenant. Executive agrees that during the Employment Period and
for the twelve (12) month period thereafter, he will not, for any reason, directly or indirectly
solicit, hire, or otherwise do any act or thing which may induce any other employee of the Company
(who is employed by the Company at the end of the Executive’s employment with the Company) to leave
the employ of the Company.

     4.5 Covenant of Nonsolicitation of Customers. Executive acknowledges the Company’s
legitimate interest in protecting its customers for a reasonable period of time following the
termination of Executive’s employment. Accordingly, Executive agrees that during the Restricted
Period, Executive will

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not: (a) directly or indirectly, solicit or accept business from, or provide products or services
to, any Customer, where such business, products or services would be competitive with the Company’s
business, products or services, or (b) do any act or thing which may interfere with or adversely
affect the relationship (contractual or otherwise) of the Company with any Customer or vendor of
the Company or induce any such Customer or vendor to cease doing business with the Company. For
purposes of this paragraph, the term “Customer” means (i) a customer of the Company to which
Executive sold or provided the Company’s products or services at any time during the two (2) year
period immediately preceding the termination of Executive’s employment, (ii) any entity for which
Executive orchestrated, developed, supervised, coordinated or participated in marketing strategy,
marketing plans and marketing campaigns on behalf of the Company at any time during the two (2)
year period immediately preceding the termination of Executive’s employment, or (iii) any entity as
to which Executive acquired Confidential and Proprietary Information at any time during Executive’s
employment with the Company. “Restricted Period” means (i) the Employment Period and the two (2)
year period thereafter of the termination of Executive’s employment.

     4.6 Covenant Not to Compete. Executive expressly acknowledges that (i) the Company is
and will be engaged in the business of providing healthcare transaction processing services and
information technology solutions to the pharmaceutical industry, including without limitation: (x)
pharmacy benefits services and analytics software and related ASP services, including claims
processing, pharmacy networks, data warehousing and information analysis, rebate contracting and
formulary management, clinical initiatives, and consumer web services; and (y) pharmacy practice
management and point of sale (POS) systems for retail pharmacy (independents and chains),
institutional/nursing home pharmacy, and high-volume mail order pharmacy; (ii) Executive is one of
a limited number of persons who has extensive knowledge and expertise relevant to the businesses of
the Company; (iii) Executive’s performance of his services for the Company hereunder will afford
Executive full and complete access to and cause Executive to become highly knowledgeable about the
Company’s Confidential and Proprietary Information; (iv) the agreements and covenants contained in
this Section 4.6 are essential to protect the business and goodwill of the Company, because, if
Executive enters into any activities competitive with the businesses of the Company, Executive will
cause substantial harm to the Company; (v) Executive will be exposed to the Company’s largest
customers; (vi) the business territory of the Company at the time this Agreement was entered into
constitutes the United States and Canada (“Business Territory”); and (vii) Executive’s covenants to
the Company set forth in this Section 4.6 are being made in consideration of the Company’s
willingness to employ him. Accordingly, Executive hereby agrees that during the Restricted Period,
Executive shall not, within the Business Territory, directly or indirectly own any interest in,
invest in, lend to, borrow from, manage, control, participate in, consult with, become employed by,
render services to, or in any other manner whatsoever engage in, any business which is competitive
with any business actively being engaged in by the Company or actively (and demonstrably) being
considered by the Company for entry into on the date of the termination of Executive’s employment
with the Company. The preceding to the contrary notwithstanding, Executive shall be free to make
investments in the publicly traded securities of any corporation, provided that such investments do
not amount to more than 1% of the outstanding securities of any class of such corporation.

     4.7 Remedies for Breach. Executive recognizes that the rights and privileges granted
to Executive by this Agreement, and Executive’s corresponding covenants to the Company, are of a
special, unique, and extraordinary character, the loss of which cannot reasonably or adequately be
compensated for in damages in any action at law or through the offset or withholding of any monies
to which Executive might be entitled from the Company. Accordingly, Executive understands and
agrees that the Company shall be entitled to equitable relief, including a temporary restraining
order and preliminary and permanent injunctive relief, to prevent or enjoin a breach of this
Agreement. Executive also understands and agrees that any such equitable relief shall be in
addition to, and not in substitution for, any other relief to which the Company may be entitled.

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ARTICLE V

TERMINATION

     5.1 Termination and Triggering Events. Notwithstanding anything to the contrary
elsewhere contained in this Agreement, the Employment Period shall terminate at the expiration of
the Initial Term or any Extension Term upon notice as provided in Section 2.2, or prior to the
expiration of the Initial Term or any Extension Term upon the occurrence of any of the following
events (hereinafter referred to as “Triggering Events”): (a) Executive’s death; (b) Executive’s
Total Disability; (c) Executive’s Resignation; (d) Termination by the Company for Cause; (e)
Termination by the Company Without Cause; (f) Termination arising out of a Change of Control; or
(g) Resignation for Good Reason.

     5.2 Rights Upon Occurrence of a Triggering Event. Subject to the provisions of Section
5.3 hereof, the rights of the parties upon the occurrence of a Triggering Event prior to the
expiration of the Initial Term or any Extension Term shall be as follows:

     (a) Death or Total Disability. If the Triggering Event was Executive’s Death or
Total Disability, then Executive shall be entitled to receive (i) Executive’s Annual Base
Compensation and accrued but unpaid vacation through the date thereof; and (ii) payment of a
Executive’s Incentive Compensation Bonus for the year in which the termination occurred, if
any, pro rated to Executive’s date of termination.

     (b) Resignation or Termination by the Company for Cause. If the Triggering
Event was Executive’s Resignation (other than a Resignation for Good Reason) or a
Termination by the Company for Cause, then Executive shall be entitled to receive
Executive’s Annual Base Compensation and accrued but unused vacation time through the date
of the Triggering Event, and to continue to participate in the Company’s Executive welfare
plans and programs (including, without limitations, health insurance plans) through the date
of the Triggering Event and, thereafter, only to the extent permitted under the terms of
such plans and programs.

     (c) Termination by Company Without Cause. If the Triggering Event was a
Termination by the Company Without Cause that is not a Termination Arising Out of a Change
of Control, then Executive shall be entitled to receive (i) Executive’s Annual Base
Compensation and accrued but unpaid vacation through the date thereof; (ii) payment of a
Executive’s Incentive Compensation Bonus for the year in which the termination occurred, if
any, pro rated to Executive’s date of termination; and (iii) the Severance Benefit (defined
below). Executive’s entitlement to the benefits provided in subsections 5.2(c)(ii) and (iii)
are contingent on Executive signing a Separation Agreement and General Release similar to
that attached hereto as Exhibit A.

     (d)
Termination Arising Out of a Change of Control. If the Triggering Event was
a Termination Arising Out of a Change of Control, then Executive shall be entitled to
receive (i) Executive’s Annual Base Compensation and accrued but unpaid vacation through the
date thereof; (ii) payment of a Executive’s Incentive Compensation Bonus for the year in
which the termination occurred, if any, pro rated to Executive’s date of termination; and
(iii) the Change of Control Severance Benefit (defined below). Executive’s entitlement to
the benefits provided in subsections 5.2(d)(ii) and (iii) are contingent on Executive
signing a Separation Agreement and General Release similar to that attached hereto as
Exhibit A.

     (e) Resignation for Good Reason. If the Triggering Event was a Resignation for
Good Reason that is not a Termination Arising Out of a Change of Control, then Executive
shall be entitled to receive (i) Executive’s Annual Base Compensation and accrued but unpaid
vacation

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through the date thereof; (ii) payment of a Executive’s Incentive Compensation Bonus for the
year in which the resignation occurred, if any, pro rated to Executive’s date of
termination; and (iii) the Severance Benefit (defined below). Executive’s entitlement to the
benefits provided in subsections 5.2(e)(ii) and (iii) are contingent on Executive signing a
Separation Agreement and General Release similar to that attached hereto as Exhibit A.

     (f) Cessation of Entitlements and Company Right of Offset. Except as otherwise
expressly provided herein, all of Executive’s rights to salary, Executive benefits, fringe
benefits and bonuses hereunder (if any) which would otherwise accrue after the termination
of the Employment Period shall cease upon the date of such termination. The Company may
offset any loans, cash advances or fixed amounts which Executive owes the Company against
any amounts it owes Executive under this Agreement.

     (g) Treatment of Options. Executive shall be required to exercise any vested
options within ninety (90) days from date of the termination of his employment.

     (h) No Duplication of Benefits. For clarification, if Executive receives
benefits under subsection 5.2(c) or 5.2(d), then Executive shall not be entitled to benefits
under any other subsection in Section 5 of this Agreement.

     For further clarity, the payments provided for in subsections 5.2(b), 5.2(c), 5.2(d) and
5.2(e) will not be subject to any reduction or elimination, except as provided by subsection
5.2(f), or if Executive breaches any Executive’s obligations under Article IV, but will not be
reduced should Executive obtain alternative employment.

     5.3 Survival of Certain Obligations. The provisions of Articles IV, and VI shall
survive any termination of the Employment Period, whether by reason of the occurrence of a
Triggering Event or the expiration of the Initial Term or any Extension Term.

     5.4 Definitions. For purposes of Article V, the following definitions apply:

     (a) “Resignation” means a voluntary termination of Executive’s employment with the
Company that is not a Resignation for Good Reason.

     (b) “Resignation for Good Reason” means a voluntary termination of Executive’s
employment hereunder on account of, and within sixty (60) days after, the occurrence of one
or more of the following events:

     (i) The assignment to Executive of any duties inconsistent in any material
respect with Executive’s position (including status, offices and titles), authority,
duties or responsibilities as contemplated by Section 1.2 hereof which results in a
diminution of Executive’s position, excluding for this purpose an isolated,
insubstantial or inadvertent action not taken in bad faith and which is remedied by
the Company within thirty (30) days after receipt of written notice thereof given by
Executive;

     (ii) The failure of the Company to comply with any of the material
provisions of this Agreement, other than an isolated, insubstantial or inadvertent
action not taken in bad faith and which is remedied by the Company within thirty
(30) days after receipt of written notice thereof given by Executive;

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     (iii) Executive is required to relocate his principal business office or his principal
residence outside of the Chicago metropolitan area, or the Company assigns Executive duties that
could reasonably require such a relocation unless, within thirty (30) days of receipt of written
notice by the Executive, the Company removes the assignment of the duties that necessitated or
could necessitate the relocation; or

     (iv) Executive is not named the Company’s Chief Executive Officer by January 1, 2009.

     (c) “Severance Benefit” means

     (1) A lump-sum payment, less required tax withholding, equal to two (2) times Executive’s
Annual Base Compensation at the time of the termination of Executive’s employment; plus, one (1)
times the average incentive compensation payment over the previous two years.

     (2) Payment of the COBRA insurance continuation benefit on behalf of Executive, his spouse and
their eligible dependents for to a maximum of eighteen months following the termination of
Executive’s employment; provided, the necessary elections are made by Executive, his spouse and
their dependents and Executive, his spouse and their dependents remain eligible to receive COBRA
insurance continuation benefits; and

     (3) Provided Executive’s employment with the Company terminates on or prior to December 31,
2008, a lump-sum payment, less required tax withholding, equal to 80% of the average of Executive’s
Annual Base Compensation for the two-year period prior to the termination of Executive’s
employment.

Except as provided by Section 6.10 of this Agreement, the Severance Benefit shall be paid within
thirty (30) days of Executive’s signing of the Separation Agreement and General Release similar to
that attached hereto as Exhibit A.

(d) “Change of Control Severance Benefit” means

     (1) A lump-sum payment, less required tax withholding, equal to (x) two times Executive’s
Annual Base Compensation at the time of the termination of Executive’s employment plus (y) two
times the greater of either (i) the average of Executive’s last two Incentive Compensation Bonuses
or (ii) 80% of the average of the Executive’s Annual Base Compensation measured over the
twenty-four month period preceding the termination of Executive’s employment; and

     (2) Payment of the COBRA insurance continuation benefit on behalf of Executive, his spouse and
their eligible dependents for to a maximum of eighteen months following the termination of
Executive’s employment; provided, the necessary elections are made by Executive, his spouse and
their dependents and Executive, his spouse and their dependents remain eligible to receive COBRA
insurance continuation benefits.

Except as provided by Section 6.10 of this Agreement, the Change of Control Severance Benefit shall
be paid within thirty (30) days of Executive’s signing of the Separation Agreement and General
Release similar to that attached hereto as Exhibit A.

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     (e) “Termination by the Company for Cause” means termination
by the Company of Executive’s employment for:

     (i) The failure of Executive to comply with any of the material provisions of
this Agreement, other than an isolated, insubstantial or inadvertent action not taken in
bad faith and which is remedied by Executive within thirty (30) days after receipt of
written notice thereof given by the Company;

     (ii) A conviction of Executive by a court of competent jurisdiction of a
felony;

     (iii) The refusal, failure or neglect of Executive to perform his duties under
his employment agreement in a manner that is materially detrimental to the business or
reputation of the Company unless remedied by Executive within thirty (30) days after
receipt of written notice thereof given by the Company;

     (iv) The engagement by the Executive in illegal, unethical or other wrongful
conduct that is materially detrimental to the business or reputation of the Company; or

     (v) The pursuit by Executive of interests that are materially adverse to the
Company unless remedied by Executive within thirty (30) days after receipt of written
notice thereof given by the Company.

     (f) “Termination by the Company Without Cause” means a termination of Executive’s employment
by the Company which is not a Termination by the Company for Cause, provided that the termination
of the Employment Period on account of the failure of the Company to extend the Employment Period
in accordance with the provisions of Section 2.2 hereof shall constitute a Termination by the
Company Without Cause.

     (g) A “Termination Arising Out of a Change of Control” occurs when Executive resigns or if
Executive is subject to a Termination by the Company with Cause or a Termination by the Company
without Cause within twelve (12) months of a “Change of Control,” which shall be defined under this
Agreement to mean any of the following occurrences:

     (i) Any person, other than SXC Health Solutions Corporation or an
employee benefit plan of SXC Health Solutions Corporation, acquires directly or indirectly
the Beneficial Ownership (as defined in Section 13(d) of the Securities Exchange Act of
1934, as amended) of any voting security of SXC Health Solutions Corporation and becomes,
immediately after and as a result of such acquisition, directly or indirectly, the
Beneficial Owner of voting securities representing 50% or more of the total voting power of
all of the then-outstanding voting securities of SXC Health Solutions Corporation;

     (ii) The shareholders of SXC Health Solutions Corporation approve a merger,
consolidation, recapitalization, or reorganization of SXC Health Solutions Corporation, a
reverse stock split of outstanding voting securities, or consummation of any such
transaction if shareholder approval is not sought or obtained, other than any such
transaction that would result in at least 75% of the total voting power represented by the
voting securities of the surviving entity outstanding immediately after, and as a result of
such transaction, being Beneficially Owned by at least 75% of the holders of outstanding
voting securities of SXC Health Solutions Corporation immediately prior to

11

 

the transaction, with the voting power of each such continuing holder relative to
other such continuing holders not substantially altered in the transaction; or

     (iii) The shareholders of SXC Health Solutions Corporation approve a plan
of complete liquidation of SXC Health Solutions Corporation or SXC Health Solutions,
Inc. or an agreement for the sale or disposition by SXC Health Solutions Corporation
of all or a substantial portion of assets (i.e., 50% or more) of the total assets of
SXC Health Solutions Corporation or SXC Health Solutions, Inc.

     (h) “Total Disability” means Executive’s inability, because of illness, injury
or other physical or mental incapacity, to perform Executive’s duties hereunder (as
determined by the Board in good faith) for a continuous period of one hundred eighty (180)
consecutive days, or for a total of one hundred eighty (180) days within any three hundred
sixty (360) consecutive day period, in which case such Total Disability shall be deemed to
have occurred on the last day of such one hundred eighty (180) day or three hundred sixty
(360) day period, as applicable.

ARTICLE VI

GENERAL

     6.1 Governing Law. This Agreement shall be subject to and governed by the laws of the
State of Illinois without regard to any choice of law or conflicts of law rules or provisions
(whether of the State of Illinois or any other jurisdiction), irrespective of the fact that
Executive may become a resident of a different state.

     6.2 Binding Effect. The Agreement shall be binding upon and inure to the benefit of
the Company, its successors and assigns, and Executive and Executive’s executors, administrators,
personal representatives and heirs.

     6.3 Assignment. Executive expressly agrees for Executive and on behalf of Executive’s
executors, administrators and heirs, that this Agreement and Executive’s obligations, rights,
interests and benefits hereunder shall not be assigned, transferred, pledged or hypothecated in any
way by Executive, Executive’s executors, administrators or heirs, and shall not be subject to
execution, attachment or similar process. Any attempt to assign, transfer, pledge, hypothecate or
otherwise dispose of this Agreement or any such rights, interests and benefits thereunder contrary
to the foregoing provisions, or the levy of any attachment or similar process thereupon shall be
null and void and without effect and shall relieve the Company of any and all liability hereunder.
This Agreement shall be assignable and transferable by the Company (but the Company shall not be
required to assign or transfer this Agreement) to any successor in interest without the consent of
Executive.

     6.4 Complete Understanding. This Agreement constitutes the complete understanding
among the parties hereto with regard to the subject matter hereof, and supersedes any and all prior
agreements and understandings relating to the employment of Executive by the Company, including
without limitation any prior compensation plans or compensation agreements entered into between
Executive and the Company.

     6.5 Amendments. No change, modification or amendment of any provision of
this Agreement shall be valid unless made in writing and signed by all of the parties
hereto.

     6.6 Waiver. The waiver by the Company of a breach of any provision of this Agreement
by Executive shall not operate or be construed as a waiver of any subsequent breach by Executive.
The

12

 

waiver by Executive of a breach of any provision of this Agreement by the Company shall not operate
as a waiver of any subsequent breach by the Company.

     6.7 Venue, Jurisdiction, Etc. Executive hereby agrees that any suit, action or
proceeding relating in any way to this Agreement shall be brought and enforced in the Eighteenth
Judicial Circuit, DuPage County, State of Illinois or in the District Court of the United States of
America for the Northern District of Illinois, Eastern Division, and in either case Executive
hereby submits to the jurisdiction of each such court. Executive hereby waives and agrees not to
assert, by way of motion or otherwise, in any such suit, action or proceeding, any right of
removal, any claim that Executive is not personally subject to the jurisdiction of the above-named
courts, that the suit, action or proceeding is brought in an inconvenient forum or that the venue
of the suit, action or proceeding is improper. Executive consents and agrees to service of process
or other legal summons for purpose of any such suit, action or proceeding by registered mail
addressed to Executive at Executive’s address listed in the business records of the Company.
Executive and the Company do each hereby waive any right to trial by jury, Executive or it may have
concerning any matter relating to this Agreement.

     6.8 Indemnification of Executive. Executive is hereby entitled to indemnification for
Executive’s acts or omissions in Executive’s capacity as an Executive or officer of the Company to
the same extent as the Company’s other senior executives and in the manner provided by the
Company’s bylaws.

     6.9 Directors & Officers Liability Insurance. The Company shall maintain adequate
Directors and Officers liability insurance coverage, which shall include Executive in Executive’s
capacity as an Officer. The adequacy of the Directors and Officers liability insurance coverage
shall be determined annually by the Board of Directors in its reasonable discretion.

     6.10 Tax Provisions.

     (a) Compliance With Section 409A of the Internal Revenue Code. To the extent
applicable, it is intended that this Agreement comply with the provisions of section 409A
of Internal Revenue Code of 1986, as amended (the “Code”), so as to prevent the inclusion
in gross income of any amounts payable or benefits provided hereunder in a taxable year
that is prior to the taxable year or years in which such amounts or benefits would
otherwise actually be distributed, provided or otherwise made available to Executive. This
Agreement shall be construed, administered, and governed in a manner consistent with this
intent. Any provision that would cause any amount payable or benefit provided under this
Agreement to be includable in the gross income of Executive under Code section 409A(a)(l)
shall have no force and effect unless and until amended to cause such amount or benefit to
not be so includable (which amendment shall be mutually agreed upon by the parties in good
faith and may be retroactive to the extent permitted by Code section 409A). In particular,
to the extent Executive becomes entitled to receive a payment or a benefit upon an event
that does not constitute a permitted distribution event under Code section 409A(a)(2), then
notwithstanding anything to the contrary in this Agreement, such payment or benefit will be
made or provided to Executive on the earlier of (i) the effective date of Executive’s
“separation from service with Company (determined in accordance with Code section 409A);
provided however, that if Executive is a “specified employee” (within the meaning of Code
section 409A), this date will be the date which is 6 months after the effective date of
Executive’s separation from service with Company, or (ii) the date of Executive’s death.
Any reference in this Agreement to Code section 409A shall also include any proposed,
temporary or final regulations, or any other guidance, promulgated with respect to such
section by the U.S. Department of the Treasury or the Internal Revenue Service.

13

 

     (b) Compliance With Section 162(m) of the Code. Notwithstanding anything
herein to the contrary, if the Company reasonably anticipates that the deduction of any
payment to Executive hereunder will be limited or eliminated by the application of Code
section 162(m), which generally limits the deduction of compensation paid by public
corporations in excess of $1 million annually to certain executives, the payment of such
amount shall be delayed until the earliest date at which the Company reasonably anticipates
that the deduction of the payment would not be limited or eliminated by the application of
Code section 162(m).

     (c) Excise Taxes Under Sections 280G and 4999 of the Code. Anything in this
Agreement to the contrary notwithstanding, in the event it shall be determined that the
Executive shall become entitled to payments and/or benefits provided by his Agreement or any
other amounts in the “nature of compensation” (whether pursuant to the terms of this
Agreement or any other plan, arrangement or agreement with the Company or any affiliate, any
person whose actions result in a change of ownership or effective control of the Company
covered by Section 280G(b)(2) of the Code or any person affiliated with the Company or such
person) as a result of such change in ownership or effective control of the Company, (a
“Payment”) would be subject to the excise tax imposed by section 4999 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 and penalties imposed with respect thereto)
and Excise Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments.

     6.11 Severability. If any portion of this Agreement shall be for any reason, invalid
or unenforceable, the remaining portion or portions shall nevertheless be valid, enforceable and
carried into effect.

     6.12 Headings. The headings of this Agreement are inserted for convenience only and
are not to be considered in the construction of the provisions hereof.

     6.13 Notices. All notices under this Agreement shall be in writing and shall be
deemed properly sent, (i) when delivered, if by personal service or reputable overnight
courier service, or (ii) when received, if sent by certified or registered mail, postage
prepaid, return receipt requested to the recipient at the address indicated below or otherwise
subsequently provided by one party to the other party:

Notices to Executive:

Mark Thierer

917 Lakewood Drive
Barrington, Illinois 60010

Notices to Company:

SXC Health Solutions, Inc.

Attn: Gordon Glenn, CEO
2441 Warrenville Road, Suite 610
Lisle, Illinois 60532-3642

14

 

With Copies to:

Larry Zanger, Esq.

Holland & Knight LLP

131 South Dearborn, 30th Floor
Chicago, Illinois 60603

     6.14 Counterparts. This Agreement may be executed in one or more counterparts,
all of which, taken together, shall constitute one and the same agreement.

	 	 	 	 	 	 	 	 	 
	COMPANY:	 	 	 	EXECUTIVE:	 	 
	 
	SXC HEALTH SOLUTIONS CORPORATION	 	 	 	 	 	 
	and SXC HEALTH SOLUTIONS, INC.	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Terrence C. Burke,
 

	 	 	 	/s/ Mark Thierer
 

	 	 
	 
	 	Terrence C. Burke, Chairman of the
	 	 	 	   Mark Thierer	 	 
	 

	 	Compensation Committee of the Board of	 	 	 	 	 	 
	 

	 	Directors	 	 	 	 	 	 

15Exhibit 10.1

 

Summary of 

March 11, 2008 Stock Option Grants

For Executive Officers

of Bakers Footwear Group, Inc.

 

The following table sets forth for each of the Company’s executive officers the number of options granted to each executive officer as of March 11, 2008:

 

	
            Name and Principal Position (1)
 	
            Shares of
Common Stock
Underlying
Options(2)
 
	
            Peter A. Edison
 	
            10,000
 
	
            Chairman of the Board, Chief Executive Officer and President
 	
             
 
	
             
 	
             
 
	
            Stanley K. Tusman
 	
            5,000
 
	
            Executive Vice President and Chief Planning Officer
 	
             
 
	
             
 	
             
 
	
            Mark D. Ianni
 	
            9,000
 
	
            Executive Vice President and Chief

Merchandising Officer
 	
             
 
	
             
 	
             
 
	
            Joseph R. Vander Pluym
 	
            9,000
 
	
            Executive Vice President and Chief Operations Officer
 	
             
 
	
             
 	
             
 
	
            Charles R. Daniel, III.
 	
            5,000
 
	
            Vice President — Finance, Controller, Treasurer and Secretary
 	
             
 

 

(1)  Each of the executive officers is a party to a written employment agreement, except for Mr. Daniel, with the Company and may be a party to other compensation arrangements with the Company that have been filed as exhibits to the Company’s Annual Report on Form 10-K or in other filings with the Securities and Exchange Commission.  The Company’s executive officers are also eligible to participate in the Bakers Footwear Group, Inc. 2003 Stock Option Plan, as amended, and the Bakers Footwear Group, Inc. 2005 Incentive Compensation Plan, receive matching employer contributions to the Company’s 401(k) plan, participate in other employee benefit plans and receive other forms of compensation.  The Company also pays premiums on a life insurance policy solely for the benefit of Mr. Tusman.

 

(2)  Each of the options was issued pursuant to the Bakers Footwear Group, Inc. 2003 Stock Option Plan, as amended, with the following terms.  Each of the options vests in five equal annual installments beginning March 11, 2009.  All such options expire ten years from the date of grant.  Each of the options has an exercise price of $1.95 per share.

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