<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) - August 30, 1996
Sterling Healthcare Group, Inc.
(Exact name of registrant as specified in its charter)
Florida 1-13074 65-0337205
(State or other juris- (Commission File (IRS Employer
diction of incorporation) Number) Identification No.)
6855 South Red Road, Suite 400
Coral Gables, Florida 33134
(Address or principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (305) 665-1911
None
(Former name or former address, if changed since last report)
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Item 1. Changes in Control of Registrant
Not Applicable
Item 2. Acquisition or Disposition of Assets
Not Applicable
Item 3. Bankruptcy or Receivership
Not Applicable
Item 4. Changes in Registrant's Certifying Accountant
Not Applicable
Item 5. Other Events
On August 30, 1996, upon the terms and subject to the conditions of that
certain Termination of Employment Contract dated August 23, 1996, Paul
Auerbach, M.D. ceased to be the Chief Operating Officer and a member of the
Board of Directors of Sterling Healthcare Group, Inc.
Item 6. Resignations of Registrant's Directors
Not Applicable
Item 7. Financial Statements and Exhibits
(a) Financial statements of business acquired
None
(b) Pro forma financial information
None
(c) Exhibits
(99) Termination of Employment Contract dated August 23, 1996 between
Sterling Healthcare Group, Inc. and Paul Auerbach, M.D.
Item 8. Change in Fiscal Year
Not Applicable
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
STERLING HEALTHCARE GROUP, INC.
(Registrant)
Dated: August 30, 1996 By: /s/ Jack S. Greenman
Jack S. Greenman
Chief Financial Officer
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LIST OF EXHIBITS
(99) Termination of Employment Contract dated August 23, 1996 between
Sterling Healthcare Group, Inc. and Paul Auerbach, M.D.
<PAGE> 1 EXHIBIT 99
TERMINATION OF EMPLOYMENT CONTRACT
THIS TERMINATION OF EMPLOYMENT CONTRACT is made and entered into this
23rd day of August 1996 ("Contract"), between STERLING HEALTHCARE GROUP, INC.,
a Florida corporation ("EMPLOYER"), and PAUL AUERBACH, M.D. ("EMPLOYEE").
R E C I T A L S:
A. Pursuant to an employment contract dated February 21, 1995 (the
"Employment Contract"), EMPLOYEE serves as the Chief Operating Officer of
EMPLOYER.
B. EMPLOYER has entered into an Agreement and Plan of Merger with FPA
Medical Management, Inc. ("FPA") pursuant to which, subject to certain
conditions precedent, EMPLOYER will become a wholly owned subsidiary
corporation of FPA.
C. EMPLOYEE and EMPLOYER have agreed that effective at the close of
business on August 30, 1996, EMPLOYEE shall cease to be an employee with
EMPLOYER (the "Termination").
D. EMPLOYEE AND EMPLOYER desire and do hereby memorialize the terms of the
Termination.
NOW, THEREFORE, in consideration of the mutual promises contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto mutually agree as follows:
ARTICLE I
RECITALS
The above stated Recitals are true and correct and are incorporated by
reference into this Contract.
ARTICLE II
Termination
Effective at the close of business on August 30, 1996 EMPLOYEE shall cease
to be an employee of EMPLOYER. This termination is by mutual agreement of the
parties.
ARTICLE III
SEVERANCE PAYMENT
On August 30, 1996, EMPLOYER shall deliver to EMPLOYEE the sum of
$200,000 cash (the "Severance Payment") provided, however that EMPLOYER shall
not deliver the Severance Payment unless the Automobile and Equipment ( as
defined in Articles V A and IX I of this Agreement) have been delivered to
EMPLOYER.
ARTICLE IV
RELEASE
Except for obligations set forth in this Agreement, EMPLOYEE hereby
releases, and forever discharges EMPLOYER, its subsidiaries, its successors and
assigns, and any and all of their past, present and/or future directors,
officers, agents, employees and shareholders, from any and all claims, causes
of action and liabilities of any kind, arising from EMPLOYEE'S employment
and/or the Termination. This Release includes, but is not limited to, claims
under the following laws: 1) The Civil Rights Act of 1964, as amended; 2) The
Age Discrimination in Employment Act, as amended or the Older Workers' Benefit
Protection Act; 3) The Americans with Disabilities Act; 4) The Employee
Retirement Income Security Act of 1974; 5) The Florida Human Relations Act; and
6) any federal, state, or local statute law or ordinance of any kind pertaining
to discrimination in employment. Except for obligations set forth in this
Agreement, EMPLOYER and any and all of its past, present and/or future
directors, officers, agents, employees and shareholders, hereby releases, and
forever discharges EMPLOYEE, from any and all claims, causes of action and
liabilities of any kind, arising from EMPLOYEE'S employment and/or the
Termination. Further, EMPLOYER shall indemnify, defend and hold harmless
EMPLOYEE to the fullest extent permitted under applicable law against all
losses, claims, damages and liabilities, (including reasonable attorneys' fees
and costs), arising out of or in any way related to EMPLOYEE'S actions while
employed by EMPLOYER so long as such actions were taken by EMPLOYEE in good
faith and within the scope of his employment. In the event of any claim,
action, suit or proceeding EMPLOYEE shall cooperate in the defense of any such
matter.
ARTICLE V
AUTOMOBILE, INSURANCE and STOCK OPTIONS
A. Automobile. EMPLOYEE shall return the automobile referred to in
Article V of the Employment Contract on August 30, 1996. EMPLOYEE acknowledges
that subsequent to August 30, 1996 EMPLOYER shall have no responsibility for
and shall not cover any payments associated with the automobile referred to in
Article V of the Employment Contract (the "Automobile").
B. Insurance. EMPLOYEE and EMPLOYER acknowledge that, subject to
applicable law and in compliance with EMPLOYER'S current benefit plans, through
August 30, 1996, EMPLOYER shall have responsibility for and shall cover any
payments associated with the medical and other insurance, as has been provided
EMPLOYEE during EMPLOYEE's employment with EMPLOYER. EMPLOYEE acknowledges
that subsequent to August 30, 1996, subject to applicable law, EMPLOYER shall
have no responsibility for and shall not cover any payments associated with any
medical, disability or other insurance provided to EMPLOYEE under the
Employment Contract or otherwise.
C. Stock Options. The Options (as such term is defined in Article IV, A.3
of the Employment Contract) shall become exercisable as of the date hereof.
Further, other than if required to do so by operation of law or in the event of
the closing of the business combination with FPA, EMPLOYER shall take no action
which would cause the shares of Common Stock underlying the Options not to be
registered on the Company's S-3 Registration Statement (SEC File No.33-96332).
No other terms or conditions of the Options shall be amended.
ARTICLE VI
CONFIDENTIALITY AND NON-SOLICITATION
A. Confidentiality. EMPLOYEE agrees that he will not publish, publicize,
or disseminate or cause or permit to be published, publicized or disseminated
directly or indirectly and will keep entirely confidential any information or
documents relating to EMPLOYER'S hospital client relationships, its physician
relationships, its new business development prospects, and the terms of this
Contract or the fact that this Contract exists, except for the purpose of
enforcing this Contract should that ever become necessary or as otherwise
required by law.
B. Non-Solicitation. For the period of one (1) year from the date hereof,
unless otherwise agreed to in writing by EMPLOYER, EMPLOYEE will not, either on
his account or for any other person, solicit, induce, attempt to induce,
interfere with, or endeavor to cause (i) any current hospital client, or any
employee, independent contractor or other affiliate of EMPLOYER or any
subsidiary of EMPLOYER to modify, amend, terminate, or otherwise alter any of
its relationships with EMPLOYER or EMPLOYER'S subsidiaries or affiliates; or
(ii) any currently retained physician to modify, amend, terminate, or otherwise
alter its relationship, including compensation arrangements with EMPLOYER,
EMPLOYER'S subsidiaries or affiliates. Further, unless otherwise agreed to in
writing by EMPLOYER, for a period of one (1) year from the date hereof,
EMPLOYEE agrees that he shall refrain from soliciting and shall not, directly
or indirectly, as sole proprietor, independent contractor, employee,
consultant, agent, partner, or joint venturer, or as an officer, director,
stockholder, agent or employee of any firm, person, entity, partnership or
corporation, or otherwise: solicit the employees of EMPLOYER or any subsidiary
of affiliate of EMPLOYER to leave the service of EMPLOYER or a subsidiary or
affiliate of EMPLOYER.
C. Remedies. In the event of an actual or threatened breach by the
EMPLOYEE of Paragraph A or B of this Article VI, EMPLOYER shall be entitled to
an injunction restraining EMPLOYEE from its prohibited conduct. If the court
should hold that the duration and/or scope (geographic or otherwise) of the
covenant contained herein is unreasonable, then, to the extent permitted by
law, the court may prescribe a duration and/or scope (geographic or otherwise),
that is reasonable and the parties agree to accept such determination, subject
to their rights of appeal. Nothing contained herein shall be construed as
prohibiting EMPLOYER or any third party from pursuing any of the remedies
available to it for such breach or threatened breach, including recovery of
damages from EMPLOYEE. In any action or proceeding to enforce the provisions of
this Article VI, the prevailing party shall be reimbursed by the other party
for all costs incurred in such action or proceeding, including, without
limitation, all court costs and filing fees and all attorneys' fees, incurred
either at the trial level or at the appellate level.
ARTICLE VII
NOTICES
Any notice, request, demand, offer, payment or communication required or
permitted to be given by any provision of this Contract shall be deemed to have
been delivered and given for all purposes if written and if (a) delivered
personally or by courier or delivery service, at the time of such delivery; or
(b) directed by registered or certified United States mail, postage and charges
prepaid, addressed to the intended recipient, at the address specified below,
at such time that the intended recipient or its agent signs or executes the
receipt:
If to EMPLOYER: Sterling Healthcare Group, Inc.
6855 South Red Road, Suite 400
Coral Gables, Florida 33134
Attn: Stephen J. Dresnick, M.D., President
If to EMPLOYEE: Paul Auerbach, M.D.
5896 S.W. 104th Street
Miami, Florida 33156
Any party may change the address to which notices are to be mailed by
giving written notice as provided herein to the other party. Commencing
immediately after the receipt of such notice, such newly designated address
shall be such person's address for purposes of all notices or other
communications required or permitted to be given pursuant to this Contract.
ARTICLE VIII
CONSTRUCTION OF CONTRACT
A. Florida Law. This Contract shall be considered for all purposes a
Florida document and shall be construed pursuant to the laws of the State of
Florida, and all of its provisions shall be administered according to and its
validity shall be determined under the laws of the State of Florida without
regard to any conflict or choice of law issues.
B. Gender and Number. Whenever appropriate, references in this Contract
in any gender shall be construed to include all other genders, references in
the singular shall be construed to include the plural, and references in the
plural shall be construed to include the singular, unless the context clearly
indicates to the contrary.
C. Certain Words. The words "hereof," "herein," "hereunder," and other
similar compounds of the word "here" shall mean and refer to the entire
Contract and not to any particular article, provision or paragraph unless so
required by the context.
D. Captions. Paragraph titles or captions contained in this Contract are
inserted only as a matter of convenience and/or reference, and they shall in no
way be construed as limiting, extending, defining or describing either the
scope or intent of this Contract or of any provision hereof.
E. Counterparts. This Contract may be executed in one or more
counterparts, and any such counterpart shall, for all purposes, be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument.
F. Severability. The invalidity or unenforceability of any provision
hereunder (or any portion of such a provision) shall not affect the validity or
enforceability of the remaining provisions (or remaining portions of such
provisions) of this Contract.
ARTICLE IX
MISCELLANEOUS
A. Entire Contract. This Contract constitutes the entire agreement among
the parties pertaining to the subject matter hereof, and supersedes and revokes
any and all prior or existing agreements, written or oral, relating to the
subject matter hereof, and this Contract shall be solely determinative of the
subject matter hereof.
B. Restrictive Covenant. In the event any restrictive covenant of this
Contract shall be deemed unenforceable, invalid or overbroad in whole or in
part for any reason, then any court of competent jurisdiction is hereby
authorized, requested and instructed to reform such provision(s) to provide
for the maximum competitive restraints upon EMPLOYEE's activities (in time and
geographic area), which may then be legal and valid.
C. Waiver. Either EMPLOYER or EMPLOYEE may, at any time or times, waive
(in whole or in part) any rights or privileges to which he or it may be
entitled hereunder However, no waiver by any party of any condition or of the
breach of any term, covenant, representation or warranty contained in this
Contract, in any one or more instances, shall be deemed to be or construed as a
further continuing waiver of any other condition or of any breach of any other
terms, covenants, representations or warranties contained in this Contract, and
no waiver shall be effective unless it is in writing and signed by the waiving
party.
D. Attorneys' Fees. In the event that either party shall be required to
retain the services of an attorney to enforce any of her or its rights
hereunder, the prevailing party in any court action shall be entitled to
receive from the other party all costs and expenses including (but not limited
to) court costs and attorneys' fees (whether in a court of original
jurisdiction or one or more courts of appellate jurisdiction) incurred by her
or it in connection therewith.
E. Venue. Any litigation arising hereunder shall be instituted only in
Dade County, Florida, the place where this Contract was executed, and all
parties hereto agree that venue shall be proper in said county for all such
legal or equitable proceedings.
F. Assignment. The rights and obligations of the parties under this
Contract shall inure to the benefit of and shall be binding upon their
successors, assigns, and/or other legal representatives. This Contract shall
not be assignable by EMPLOYER or EMPLOYEE.
G. Amendment. This Contract may not be amended, modified, superseded,
canceled, or terminated, and any of the matters, covenants, representations,
warranties or conditions hereof may not be waived, except by a written
instrument executed by EMPLOYER and EMPLOYEE or, in the case of a waiver, by
the party to be charged with such waiver.
H. No Third Party Beneficiary. Nothing expressed or implied in this
Agreement is intended or shall be construed to confer upon or give any person,
other than EMPLOYER and EMPLOYEE and their respective successors and permitted
assigns, any rights or remedies under or by reason of this Agreement.
I. Return of Equipment. Any and all equipment, including , without
limitation, dictating equipment, computer equipment and accessories, electronic
equipment and other office equipment provided by EMPLOYER to EMPLOYEE during
the term of EMPLOYEE'S employment with EMPLOYER (the "Equipment") shall be
returned to EMPLOYER as of August 30, 1996.
J. No Disparagement. EMPLOYEE and EMPLOYER hereby agree that neither
shall take any action, legal or otherwise, which might embarrass, harass or
adversely affect the other or which might in any way work to the detriment,
whether directly or indirectly of the other. In particular and by way of
illustration, not limitation, EMPLOYER and EMPLOYEE agree that they will not
directly or indirectly contact the press or media, any federal or state or
local government agency, or any business entity that has a business
relationship with either EMPLOYER or EMPLOYEE in order to disparage the
reputation or business practices of the other or of any affiliates of the
other.
K. Directorships/Affiliates. As of August 30, 1996 EMPLOYEE shall cease
to be an employee or director of EMPLOYER or any subsidiaries or affiliates of
EMPLOYER.
I HAVE CAREFULLY READ AND FULLY UNDERSTAND THE PROVISIONS OF THIS CONTRACT AND
THE RELEASE CONTAINED IN ARTICLE IV. I ACKNOWLEDGE THAT I HAVE HAD 21 DAYS FROM
THE DATE OF THIS CONTRACT TO CONSIDER IT AND TO CONSULT WITH AN ATTORNEY. I
ALSO UNDERSTAND THAT IF I SIGN THIS DOCUMENT, I HAVE 7 DAYS TO REVOKE IT. MY
SIGNATURE ACKNOWLEDGES THAT I HAVE ENTERED INTO THIS CONTRACT FREELY, KNOWINGLY
AND VOLUNTARILY WITHOUT DURESS AND WITH A FULL UNDERSTANDING OF ITS TERMS.
IN WITNESS WHEREOF, EMPLOYER and EMPLOYEE have caused this Contract to be
executed on the day and year first above written.
"EMPLOYER"
STERLING HEALTHCARE GROUP, INC.
Dated: August 23, 1996 By: /s/ Stephen J. Dresnick
Authorized Representative
"EMPLOYEE"
Dated: August 23, 1996 By: /s/ Paul Auerbach, M.D.
Paul Auerbach, M.D.
