Chief Financial Officer Severance Agreement

SEPARATION AGREEMENT AND GENERAL RELEASE


This Separation Agreement and General Release ("Agreement") is entered into by and between Community Psychiatric Centers ("Employer") and Steve Weis ("Employee") in consideration of the following facts:


A. Employee is employed by Employer in the position of Executive Vice President and Chief Financial Officer of Employer.


B. Employee has voluntarily resigned from his position as Executive Vice President and Chief Financial Officer of Employer, subject to the execution of this Agreement, and Employer has accepted Employee's resignation. Employer and Employee have agreed that Employee's employment will permanently terminate effective December 31, 1994 ("Termination Date").


C. Employee acknowledges that he has timely received all wages due through the Termination Date.


D. Employer and Employee are desirous of entering into an agreement to provide for the settlement and release of any claims related to Employee's employment and the termination of that employment.


ACCORDINGLY, in consideration of the terms, conditions and agreements set forth below, the parties covenant and agree as follows:


1. Review Period. Employee shall have until the close of business on January 21, 1995, to accept the terms of this Agreement. Employee may use as much of that time as Employee wishes. Employee has consulted with an attorney before signing this Agreement.


2. Severance Benefits. Provided Employee executes this Agreement and all documents required to effectuate same, then upon expiration of the seven (7) day revocation period described in paragraph 18 below, Employer agrees to provide Employee the payments and benefits set forth below in subparagraphs 2.1 through 2.8 Employee understands that the amounts set forth below are all that Employee is entitled to receive from Employer except for the right to purchase continuation coverage under Employer's group health plan for employee and any eligible dependents pursuant to the provisions of the Consolidated Omnibus Budget Reconciliation Act (COBRA) as explained in the notice delivered to Employee contemporaneously with the delivery of this document, except for any other vested employee benefits, including but not limited to, any retirement benefits governed by or arising under the Employee Retirement Income Security Act of 1974, as amended ("ERISA") or Internal Revenue Code Section 401(k), and, the Indemnification Agreement dated December 7, 1991 (the "Indemnification Agreement"). Employee hereby acknowledges that the severance benefit set forth below is more than the Employer is required to pay under its normal policies and practices.


2.1 Severance Pay. Employer will pay Employee a severance benefit of Two Hundred Seventy-Five Thousand Dollars ($275,000.00) equal to fifty-two (52) weeks of pay at Employee's base rate of pay, less deductions required by law. Payment will be made in thirteen (13) equal increments of Twenty-One Thousand One Hundred Fifty-Three Dollars and Eighty-Four Cents ($21,153.84), payable consecutively on the first thirteen (13) dates on which Employer pays its employees, beginning with the next regular pay day after receipt of the signed copy of this Agreement and expiration of the seven (7) day revocation period described in paragraph 18 below. Such payments shall be mailed to Employee's most recent address on file with Employer.


2.2 Vacation Pay Employee has accrued Two Hundred Fifty-Seven and Seventy-Two Hundreds (257.72) hours of unused vacation time for which he is entitled to receive payment in the amount of Thirty-Four Thousand Sixty-Three Dollars and Sixty-Eight Cents ($34,063.68), which Employer shall pay in one lump sum.


2.3 Health Insurance Benefits Employer will continue Employee's eligibility for health benefits under Employer's Health Payment Plan through December 31, 1995 (unless Employee obtains other coverage earlier and notifies Employer of such by written notice.) Employer and Employee shall each pay their usual share of such premiums, and Employer is hereby authorized to deduct Employee's share of such premiums from the severance benefits payable under paragraph 2.1 hereof. Employer shall be entitled to modify or terminate its Health Payment Plan, but Employee shall not be treated any worse than any other employees of Employer in such event. After December 31, 1995, or upon the earlier termination by Employee as hereinabove provided, Employee will be eligible to purchase eighteen (18) months of continued health care coverage pursuant to the provisions of COBRA.


2.4 Transfer of Company Automobile Employer will deliver to Employee, free of charge to Employee, a certificate of title to the automobile owned by Employer that Employee is presently using to Employee that is properly endorsed to transfer ownership of the vehicle to Employee. The automobile is being transferred in its "as is" condition, without covenant or warranty, express or implied, of any kind, nature or description. Employee covenants and agrees to immediately register ownership of the vehicle in his name promptly upon delivery of the endorsed certificate of title. Employee shall be, from and after the date of delivery of the endorsed certificate of title, solely responsible for all expenses associated with the cost of transferring title, including, but not limited to, any license fees, certificate transfer fees and use taxes, and the care, upkeep and insuring the vehicle. Notwithstanding the foregoing, it is understood and agreed that Employer shall continue to furnish insurance on the vehicle through February 28, 1995, at Employee's sole cost and expense, until Employee can establish California residency and qualify for California automobile insurance. The cost of such insurance coverage shall be deducted from the payments to be made to Employee during the months of January and February, 1995, under paragraph 2.1 hereof. Should Employee fail to register the vehicle in his name and provide Employer with written proof of same by no later than February 25, 1995, then until Employee does so, Employer shall be entitled to continue insurance coverage beyond February 28, and to deduct the cost of same from the amount owed to Employee AND to suspend any and all further payments coming due under paragraph 2.1 from and after February 25, 1995.


2.5 Transfer of Company Computer Employer will transfer to Employee, free of charge to Employee, all of its right, title and interest in and to the laptop and desk computers that Employee utilized in his position with Employer. These computers are being transferred in their "as is" condition, without covenant or warranty, express or implied, of any kind, nature or description. Employee shall be, from and after the Termination Date, responsible for all taxes on and all expenses associated with the care, upkeep and insuring the computers.


2.6 Purchase of Employee's Residences Employer has advanced certain sums to Employee in connection with the construction of a single family residence in Las Vegas, Nevada. Employer hereby agrees to accept a grant deed to the subject property upon which the single family residence is being constructed, in form and content acceptable to Employer, properly executed and notarized by Employee and his wife, together with an appropriate endorsement to Employee's title insurance policy naming Employer, as Employee's assignee, as the insured under the policy in full satisfaction of Employee's indebtedness for all advances


heretofore made by Employer to Employee for such construction. It is understood and agreed that nothing contained in this Agreement shall alter or modify the contract by which Employer acquired title to Employee's former residence in Laguna Hills, California, or otherwise entitle Employer to rescind that contract, and Employer shall be entitled to dispose of the California property through the Coldwell Banker Relocation Group and to retain all proceeds realized from any sale of that property, and Employee hereby acknowledges that he shall have no right, title or interest in or to any portion of the proceeds realized from such sale.


2.7 Relocation to California Employer will reimburse Employee for the cost of moving Employee's household goods to either Los Angeles or Orange Counties, California at any time within one (1) year from the date of this Agreement. The maximum amount that Employer shall be obligated to reimburse Employee under this Agreement, regardless of the actual cost of relocation, shall be Five Thousand Six Hundred Thirty-Five Dollars ($5,635.00) or the actual amount paid to the moving company, whichever is lower. Payment shall be made within seven (7) days of receipt of a valid invoice.


2.8 Employee Stock Options Employee shall be entitled to exercise his vested stock options according to the Plan Agreement, as of December 31, 1994, for a period not to extend beyond December 31, 1995.


2.9 Taxation of Benefits. It is understood and agreed that Employer shall not withhold any taxes or other payroll deductions from the amounts to be paid under paragraph 2.1 or 2.2 hereof for the value of any of the benefits conferred on Employee under paragraphs 2.3 though 2.7 hereof, however, Employee understands and agrees that Employer shall file an IRS form 1099 for the value of all such benefits conferred on Employee. For purposes of form 1099, Employer shall use the net book value of the automobile.


3. Release of Claims.


3.1 Subject to paragraph 3.2 hereof, in consideration of Employer's acceptance of this General Release and its resulting obligations hereunder, and other good and valuable consideration of the receipt and sufficiency whereof is hereby acknowledged, Employee, for himself, his heirs, executors, representatives, principals, successors and assigns, and for all persons acting by, through or under him, doe ...