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Exhibit 10.8
LANVISION SYSTEMS, INC.
EMPLOYMENT AGREEMENT AMONG LANVISION SYSTEMS, INC., LANVISION, INC. AND XXXX X.
XXXXXXX, EFFECTIVE JUNE 1, 1996
EMPLOYMENT AGREEMENT
--------------------
This EMPLOYMENT AGREEMENT (this "Agreement") is entered into effective
as of June 1, 1996 by and among LanVision Systems, Inc., a Delaware corporation
("Parent"), LanVision, Inc., an Ohio corporation ("Company") and Xxxx X. Xxxxxxx
("Employee").
RECITALS:
---------
A. Parent and the Company mutually desire to employ Employee to
perform certain legal and human resources services for Parent and the Company;
and
B. Employee possesses certain skills and expertise in legal and human
resources services and desires to provide such services to Parent and the
Company as their employee.
NOW, THEREFORE, in consideration of the premises and the agreements
contained herein, and for other good and valuable consideration, the receipt and
adequacy of which the parties hereby acknowledge, the parties agree as follows:
1. EMPLOYMENT
----------
Parent and the Company hereby agree to employ Employee, and Employee,
in consideration of such employment and other consideration set forth herein,
hereby accepts employment, upon the terms and conditions set forth herein.
2. POSITION AND DUTIES
-------------------
During the term of this Agreement, Employee shall be employed in the
position of General Counsel and Director of Human Resources of each of Parent
and the Company. While employed hereunder, Employee shall do all things
necessary, legal and incident to the above position, and otherwise shall perform
such functions as the President and/or Chief Financial Officer of Parent or the
Company may establish from time to time. Without limiting the foregoing,
Employee will be responsible for and direct the legal and human resources
operations and functions for Parent and the Company. Employee shall be available
to perform such duties on a full-time (40 hours per week, Monday through Friday)
basis at the Company's offices located at 00000 Xxxxxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxx, or at such other locations designated by Parent or Company from time to
time.
3. COMPENSATION
------------
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Subject to such modifications as may be approved from time to time by
the Board of Directors or Officers of Parent, the Employee shall receive the
compensation and benefits as set forth in the offer letter dated April 16, 1996
from Xxxxxx X. Xxxxxxx, a copy of which is attached hereto. Such compensation
shall be paid by Parent or the Company, at the discretion of Parent.
4. EXPENSES
--------
Parent or the Company shall pay or reimburse Employee for all travel
and out-of-pocket expenses reasonably incurred or paid by the Employee in
connection with the performance of Employee's duties as an employee of Parent or
the Company, respectively, upon compliance with the Company's procedures for
expense reimbursement including the presentation of expense statements or
receipts or such other supporting documentation as the Company may reasonably
require.
5. PRIOR EMPLOYMENT
----------------
The Employee warrants and represents to Parent and the Company (i) that
the Employee will take no action in violation of any employment agreement or
arrangement with any prior employer, (ii) that the Employee has disclosed to
Parent and the Company all such prior written agreements, and (iii) that the
employee has the full right and authority to enter into this Agreement and to
perform all of the Employee's obligations hereunder. The Employee agrees to
indemnify and hold Parent and the Company harmless from and against any and all
claims, liabilities or expenses incurred by Parent and/or the Company as a
result of any claim made by any prior employer arising out of this Agreement or
the employment of the Employee by Parent and the Company.
6. OUTSIDE EMPLOYMENT
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Employee shall devote Employee's full time and attention to the
performance of the duties incident to Employee's position with Parent and the
Company, and shall not have any other employment with any other enterprise or
substantial responsibility for any enterprise which would be inconsistent with
Employee's duty to devote Employee's full time and attention to Parent and
Company matters, provided that, the foregoing shall not prevent the Employee
from participating in any charitable or civic organization that does not
interfere with Employee's performance of the duties and responsibilities to be
performed by Employee under this Agreement.
7. CONFIDENTIAL INFORMATION
------------------------
Employee shall not, during the term of this Agreement or at any time
thereafter, disclose, or cause to be disclosed, in any way Confidential
Information, or any part thereof, to any person, firm, corporation, association,
or any other operation or entity, or use the Confidential Information on
Employee's own behalf, for any reason or purpose. Employee further agrees that,
during the term of this Agreement or at any time thereafter, Employee will not
distribute, or cause to be distributed, Confidential Information to any third
person or permit the reproduction of the Confidential Information, except on
behalf of Parent or the Company in Employee's capacity as an
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employee of Parent and the Company. Employee shall take all reasonable care to
avoid unauthorized disclosure or use of the Confidential Information. Employee
hereby assumes responsibility for and shall indemnify and hold Parent and/or
the Company harmless from and against any disclosure or use of the
confidential Information in violation of this Agreement.
For the purpose of this Agreement, "Confidential Information" shall
mean any written or unwritten information which specifically relates to and/or
is used in Parent's or the Company's business (including without limitation,
Parent's or the Company's services, processes, patents systems, equipment,
creations, designs, formats, programming, discoveries inventions, improvements,
computer programs, data kept on computer, engineering, research, development,
applications, financial information, information regarding services and products
in development, market information including test marketing or localized
marketing, other information regarding processes or plans in development, trade
secrets, training manuals, know-how of the Company, and the customers, clients,
suppliers and others with whom Parent and/or the Company does or has in the past
done, business, regardless of when and by whom such information was developed or
acquired) which Parent or the Company deems confidential and proprietary which
is generally not known to others outside Parent or the Company and which gives
or tends to give Parent or the Company a competitive advantage over persons who
do not possess such information or the secrecy of which is otherwise of value to
Parent and/or the Company in the conduct of its business -- regardless of when
and by whom such information was developed or acquired, and regardless of
whether any of these are described in writing, reduced to practice,
copyrightable, or considered copyrightable, patentable or considered patentable.
Provided, however, that "Confidential Information" shall not include general
industry information or information which is publicly available or is otherwise
in the public domain without breach of this Agreement, information which
Employee has lawfully acquired from a source other than Parent or the Company,
or information which is required to be disclosed pursuant to any law,
regulation, or rule of any governmental body or authority or court order.
Employee acknowledges that the Confidential Information is novel, proprietary to
and of considerable value to Parent and the Company.
Employee agrees that all restrictions contained in this Section 7 are
reasonable and valid under the circumstances and hereby waives all defenses to
the strict enforcement thereof by Parent and/or the Company.
Employee agrees that, upon the request of Parent or the Company,
Employee will immediately deliver up to the requesting entity all Confidential
Information in Employee's possession and/or control, and all notes, records,
memoranda, correspondence, files and other papers, and all copies, relating to
or containing Confidential Information. Employee does not have, nor can Employee
acquire any property or other right in the Confidential Information.
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8. PROPERTY OF PARENT AND THE COMPANY
----------------------------------
All ideas, inventions, discoveries, proprietary information, know-how,
processes and other developments and, more specifically, improvements to
existing inventions, conceived by the Employee, alone or with others, during the
term of the Employee's employment, whether or not during working hours and
whether or not while working on a specific project, that are within the scope of
Parent's or the Company's business operations or that relate to any work or
projects of Parent or the Company, are and shall remain the exclusive property
of Parent and the Company. Inventions, improvements and discoveries relating to
the business of Parent or the Company conceived or made by the Employee, either
alone or with others, while employed with Parent and the Company are
conclusively and irrebutably presumed to have been made during the period of
employment and are the sole property of Parent and the Company. The Employee
shall promptly disclose in writing any such matters to Parent and the Company
but to no other person without the consent of Parent. The Employee will, upon
request of Parent, execute such assignments or other instruments and assist
Parent and the Company in the obtaining, at the Company's sole expense, of any
patents, trademarks or similar protection, if available, in the name of the
Company.
9. NON-COMPETITION AGREEMENT
-------------------------
(A) Except for a change in control of Parent, during the term of this
Agreement and for a period of one year after the termination date of this
Agreement (whether such termination be with or without cause), Employee agrees
that he will not directly or indirectly, own, operate or otherwise work for or
participate in any competitive business in the United States which designs,
develops, manufactures or markets any product or service that in any way
competes with Parent's or the Company's business, products or services as
conducted, or planned to be conducted, on the date of termination (a
"Competitive Business").
(B) During the term of this Agreement and for a period ending one year
from the termination of Employee's employment with Parent and the Company,
whether by reason of the expiration of the term of this Agreement, resignation,
discharge by Parent and the Company or otherwise, Employee hereby agrees that
Employee will not, directly or indirectly:
(i) solicit, otherwise attempt to employ or contract with any
current or future employee of Parent or the Company for employment or
otherwise in any Competitive Business or otherwise offer any inducement
to any current or future employee of Parent or the Company to leave
Parent's or the Company's employ, except that the foregoing restriction
shall not apply to Employee with respect to the person serving as his
administrative assistant; or
(ii) contact or solicit any customer or client of Parent or
the Company (an "Existing Customer"), contact or solicit any individual
or business entity with whom Parent or the Company has directly
communicated for the purpose of rendering services prior to the
effective date of such termination ("a Potential Customer") or
otherwise provide any other products or services for any Existing
Customer or Potential Customer
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of Parent or the Company, on behalf of a Competitive Business or in a
manner that is competitive to the Parent's or the Company's business;
or
(iii) use or divulge to anyone any information about the
identity of Parent's or the Company's customers or suppliers (including
without limitation, mental or written customer lists and customer
prospect lists), or information about customer requirements,
transactions, work orders, pricing policies, plans, or any other
Confidential Information.
(C) For the purpose of this Agreement, Competitive Business shall mean
any business operation (including a sole proprietorship) in the United States
which designs, develops, manufactures or markets any product or service that in
any way competes with Parent's or the Company's health information access system
business, products or services as conducted, or contemplated to be conducted, on
the date of termination.
10. TERM
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Unless earlier terminated pursuant to Section 11 hereof, the term of
this Agreement shall be for the time period beginning June 1, 1996 the date
hereof and continuing through May 31, 1999 (the "Term"). Neither Parent or the
Company nor the Employee shall have any obligation to the other to negotiate a
new period of employment subsequent to the end of the Term.
11. TERMINATION
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(A) DEATH This Agreement and Employee's employment thereunder shall be
terminated on the death of Employee, effective as of the date of Employee's
death.
(B) CONTINUED DISABILITY This Agreement and Employee's employment
thereunder may be terminated, at the option of Parent upon a Continued
Disability of Employee, effective as of the date of the determination of
continued Disability as that term is hereinafter defined. For the purposes of
this Agreement, "Continued Disability" shall be defined as the inability or
incapacity (either mental or physical) of Employee to continue to perform 120
working days, or if, during any calendar year of the Term hereof because of
disability, Employee shall have been unable to perform Employee's duties
hereunder for a total period of 180 working days regardless of whether or not
such days are consecutive. The determination as to whether Employee is unable to
perform the essential functions of Employee's job shall be made by Parent's
Board of Directors in its reasonable discretion; provided, however, that if
Employee is not satisfied with the decision of the Board, Employee will submit
to examination by three competent physicians who practice in the metropolitan
area in which the Employee then resides, one of whom shall be selected by
Parent, another of whom shall be selected by Employee, with the third to be
selected by the physicians so selected. The decision of a majority of the
physicians so selected shall supersede the decision of the Board and shall be
final and conclusive.
(C) TERMINATION FOR GOOD CAUSE Notwithstanding any other provision of
this Agreement, Parent may at any time immediately terminate this Agreement and
Employee's employment thereunder for Good Cause. For this purpose, "Good Cause"
shall include the
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following: the current use of illegal drugs; indictment for any crime
involving moral turpitude, fraud or misrepresentation; commission of any act
which would constitute a felony and which would adversely impact the business
or reputation of Parent or the Company; fraud; misappropriation or
embezzlement of Parent or Company funds or property; willful conduct which is
materially injurious to the reputation, business or business relationships of
Parent or the Company; or material violation of any of the provisions of this
Agreement. Any alleged cause for termination shall be delivered in writing to
Employee stating the full basis for such cause along with any notice of such
termination.
(D) TERMINATION WITHOUT GOOD CAUSE Parent or the Company may terminate
Employee's employment prior to the Expiration Date at any time, whether or not
for Good Cause (as "Good Cause" is defined in Section 11 (C) above). In the
event Parent or the Company terminates Employee without cause, Parent or the
company will pay Employee a lump sum amount equal to three-quarters times the
Employee's annual salary and bonus at the time of termination. Such severance
payment shall be paid within 90 days following the date of Employee's
termination.
12. CHANGE IN CONTROL; ACCELARATED VESTING SHEDULES
------------------------------------------------
In the event that, within twelve months of a change in control of
Parent, Employee's employment by Parent and the Company is terminated prior to
the end of the Term or Employee terminates his employment due to a material
reduction in his duties or compensation, (i) all stock options granted to
Employee shall immediately vest in full, and (ii) Parent or the Company will pay
Employee a lump sum amount equal to three-quarters times the Employee's annual
salary and bonus at the time of termination. For purposes of this Agreement,
"change in control" means any of the following events:
(a) A change in control of the direction and administration of
Parent's business of a nature that would be required to be reported
in response to Item 6(e) of Schedule 14A of regulation 14A
promulgated under the Securities Exchange Act of 1934, as amended the
(the "1934 Act"), as in effect on the date hereof and any successor
provision of the regulations under the 1934 Act, whether or not
Parent is the subject to such reporting requirements; or
(b) Any "person" (as such term is used in Xxxxxxx 00 (x) xxx Xxxxxxx
00 (x) (2) of the 1934 Act but excluding any employee benefit plan of
Parent) is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the 1934 Act), directly or indirectly, of securities of
Parent representing more than one half of the combined voting power
of Parent's outstanding securities then entitled to vote for the
election of directors; or
(c) Parent shall sell all or substantially all of the assets of
Parent; or
(d) Parent shall participate in a merger, reorganization,
consolidation or similar business combination that constitutes a
change in control as defined in the 1996 LanVision
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Systems, Inc. Employee Stock Option Plan and/or results in the
occurrence of any event described in clause (a), (b), or (c) above.
13. ACKNOWLEDGEMENTS
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Parent, the Company and Employee each hereby acknowledge and agree as
follows:
(A) The covenants, restrictions, agreements and obligations set forth
herein are founded upon valuable consideration, and, with respect to the
covenants, restrictions, agreements and obligations set forth in Sections 7, 8
and 9 hereof, are reasonable in duration and geographic scope.
(B) In the event of a breach or threatened breach by Employee of any of
the covenants, restrictions, agreements and obligations set forth in Section 7,
8, and/or 9, monetary damages or the other remedies at law that may be available
to Parent and/or the Company for such breach or threatened breach will be
inadequate and, without prejudice to Parent's or the Company's right to pursue
any other remedies at law or in equity available to it for such breach or
threatened breach, including, without limitation, the recovery of damages from
Employee, Parent and/or the Company will be entitled to injunctive relief from a
court of competent jurisdiction; and
(C) The time period and geographical area set forth in Section 9 hereof
are each divisible and separable, and, in the event that the covenants not to
compete contained therein are judicially held invalid or unenforceable as to
such time period and/or geographical area, they will be valid and enforceable in
such geographical area(s) and for such time period(s) which the court determines
to be reasonable and enforceable. The Employee agrees that in the event any
court of competent jurisdiction determines that the above covenants are invalid
or unenforceable to join with Parent and the Company in requesting that court to
construe the applicable provision by limiting or reducing it so as to be
enforceable to the extent compatible with the then applicable law. Furthermore,
any period of restriction or covenant herein stated shall not include any period
of violation or period of time required for litigation to enforce such
restriction or covenant.
14. NOTICES
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Any notice or communication required or permitted hereunder shall be
given in writing and shall be sufficiently given if delivered personally or sent
by telecopier to such party addressed as follows:
(A) In the case of Parent or the Company, if addressed to it as
follows:
LanVision Systems, Inc.
00000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Attn: J. Xxxxx Xxxxx
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(B) In the case of Employee, if addressed to Employee at:
Xxxx X. Xxxxxxx
00000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Any such notice delivered personally or by telecopier shall be deemed
to have been received on the date of such delivery. Any address for the giving
of notice hereunder may be changed by notice in writing.
15. ASSIGNMENT, SUCCESSORS AND ASSIGNS
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This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective legal representatives, successors and
assigns. Parent and the Company may assign or otherwise transfer their rights
under this Agreement to any successor or affiliated business or corporation
(whether by sale of stock, merger, consolidation, sale of assets or otherwise),
but this Agreement may not be assigned, nor may the duties hereunder be
delegated by Employee. In the event that Parent and the Company assign or
otherwise transfer their rights under this Agreement to any successor or
affiliated business or corporation (whether by sale of stock, merger,
consolidation, sale of assets or otherwise), for all purposes of this Agreement,
"Parent" and the "Company" shall then be deemed to include the successor or
affiliated business or corporation to which Parent and the Company respectively,
assigned or otherwise transferred their rights hereunder.
16, MODIFICATION
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This Agreement may not be released, discharged, abandoned, changed, or
modified in any manner, except by an instrument in writing signed by each of the
parties hereto.
17. SEVERABILITY
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The invalidity or unenforceability of any particular provision of this
Agreement shall not affect any other provisions hereof, and this Agreement shall
be construed in all respects as if any such invalid provision were omitted
herefrom.
18. COUNTERPARTS
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This Agreement may be signed in counterparts and each of such
counterpart shall constitute an original document and such counterparts taken
together, shall constitute one in the same instrument.
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19. DISPUTE RESOLUTION
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Except as set forth in Section 13 above, any and all disputes arising
out of or in connection with the execution, interpretation, performance, or
non-performance of this Agreement or any agreement or other instrument between,
involving or affecting the parties (including the validity, scope and
enforceability of this arbitration clause), shall be submitted to and resolved
by arbitration. The arbitration shall be conducted pursuant to the terms of the
Federal Arbitration Act and the Commercial Arbitration Rules of the American
Arbitration Association. Either party may notify the other party at any time of
the existence of an arbitrable controversy by certified mail and shall attempt
in good faith to resolve their differences within 15 days after the receipt of
such notice. If the dispute cannot be resolved within the fifteen-day period,
either party may file a written demand for arbitration with the American
Arbitration Association. The place of arbitration shall be Cincinnati, Ohio.
20. GOVERNING LAW
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The provisions of this Agreement shall be governed by and interpreted
in accordance with the laws of the State of Ohio and the laws of the United
States applicable therein. The Employee acknowledges and agrees that Employee is
subject to personal jurisdiction in state and federal courts in Xxxxxxxx County,
Ohio.
IN WITNESS WHEREOF, this Agreement has been executed by the parties
hereto effective as of the date first above written.
LANVISION SYSTEMS, INC.
By: /s/ J. Xxxxx Xxxxx
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Its: President
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LANVISION, INC.
By: /s/ J. Xxxxx Xxxxx
---------------------------------
Its: President
---------------------------------
EMPLOYEE
/s/ Xxxx X. Xxxxxxx
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April 16, 1996
Xxxx X. Xxxxxxx
00 Xxxx Xxxxx Xxxxx
Xxxx Xxxxxx, Xxxxxxxx
Dear Xxxx:
On behalf of LanVision, Inc., I am pleased to extend this offer of full time
employment to join our company as director of human resources and general
counsel. We understand that you must give your current employer adequate notice.
However, it is our understanding that you will commence work no later than June
3,1996. Your salary will be $9,583.33 monthly which is equivalent to $115,000
per year. In addition, you will be eligible for a $15,000 bonus that will be
based upon LanVision achieving its revenue, gross margin and profitability goals
on terms similar to the executive officers of LanVision. Also, you will receive
options to purchase 12,000 common shares of LanVision Systems, Inc. at $13.00
per share. You will be immediately eligible for two weeks of vacation. However,
after January 31,1997, you will become eligible for three weeks of vacation.
Furthermore, you will be eligible for a $300 per month car allowance.
You are eligible to join our Company Healthcare Insurance Plan on the first day
of the month following 30 days from your start date. Also, upon the completion
of one full year of contribution you will become eligible to join Employee Stock
Purchase Plan for full time associates. This plan was put into effect by the
Board Of Directors of The Company on November 30, 1995. The plan is designed to
offer incentive for all of us to maximize the quality of products and services
LanVision provides and to share the reward of the company's long term success
from having done so.
Also, in the event of a change in control resulting in the loss of your job or a
decrease in your pay or responsibilities or termination without cause, you will
be entitled to severance pay equal to three fourths of your total annual
compensation.
Please note that this offer of employment is contingent upon the absence of any
conflicts and your signing a confidentiality and non-compete agreement. If you
have any questions regarding any of this information, please do not hesitate to
ask me for further details.
Xxxx, I am sure you will significantly contribute to the success of LanVision.,
and I am looking forward to working with you once again.
Very truly yours,
/s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
Chief Financial Officer
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