EXECUTIVE EMPLOYMENT AGREEMENT
AGREEMENT made the 14TH day of OCTOBER , 1996, by and between
COMPSCRIPT, INC., a Florida corporation, with its principal office at 1225 N.W.
Broken Sound Parkway, Suite A, Boca Raton, Florida 33487 (the "Company") and
XXXX XXXXXX, whose residence address is 0000 Xxxxxxx Xxxxx, Xxxxxxx Xxxxx,
Xxxxxxx (the "Executive").
The Company and the Executive hereby agree as follows with respect to
the Executive's employment with the Company.
1. EMPLOYMENT. The Company shall employ the executive and the
executive shall be employed with the Company, on the terms and conditions
hereafter set forth, for a period commencing January 1, 1997 and ending December
31, 1999, (the "Employment Period"), except as hereinafter provided. During his
employment hereunder, the Executive shall be the Company's Chief Financial
Officer, under the direction of the Chief Executive officer. The Executive's
principal place of employment shall be Boca Raton, Florida.
2. EXCLUSIVE EFFORTS. The Executive shall devote his best efforts,
skills and attention exclusively to the business and affairs of the Company,
shall serve the Company faithfully and competently and shall, at all times, act
in the Company's best interest. The services to be rendered by Executive during
the Employment Period shall be the normal duties of a person employed as a Chief
Financial Officer by a corporation in the Company's business, subject at all
times to the direction and control of the Company's Chief Executive Officer.
During his employment by the Company, the Executive shall not, either directly
or indirectly, (a) represent or be employed by any other person, firm or
corporation; (b) have any interest in or involvement with any person, firm or
corporation the business of which is competitive with any aspect of the business
of the Company; provided, however, that nothing herein shall be construed to
prevent Executive from investing his personal assets in other entities which do
not compete with the Company where the form and manner of such investment will
not require service on the part of Employee in the operation of the affairs of
the business in which such investments are made and in which his participation
is solely that of a passive investor; and further providing nothing herein shall
prevent Executive from consulting with Computer Integration Corp. during the
period ending February 28, 1997.
3. BASE COMPENSATIONS.
(a) The Company shall pay to the Executive, and the Executive
agrees to accept, minimum base compensation of One Hundred Twenty Thousand
Dollars ($120,000.00) per year, which base compensation shall increase by five
percent (5%) per year beginning January 1, 1998.
(b) The compensation provided for in Paragraph 3(a) shall be
in addition to any pension or retirement benefits, life insurance, hospital and
medical, disability, and other benefits made generally available by the Company,
in its sole discretion, if any, to its executive offices and other employees.
4. BONUS COMPENSATION.
(a) Executive shall be entitled to receive a minimum bonus
equal to 10% of the base salary of the Executive for each year during the term
hereof. Such minimum bonus may be increased from time to time at the discretion
of the Chief Executive Officer.
(b) In addition to the minimum bonus provided in Paragraph
4(a), the Executive shall also be entitled to receive discretionary bonuses from
time to time at the discretion of the Chief Executive Officer, relating to the
Executive's role in acquisitions, financing and equity transactions.
5. STOCK OPTIONS. Executive shall receive, upon execution of this
Employment Agreement, non-qualified stock options, which options will vest
immediately, for 80,000 shares of CompScript common stock at an exercise price
of $5.13 per share as recorded on the day of the beginning of this employment
negotiation.
6. BENEFIT PLANS. The Executive shall be entitled to participate, to
the extent eligible, in medical, dental, hospital, group life insurance and
other fringe benefit programs from time to time made available to the Company's
executives.
(a) Beginning on January 1, 1998, the Company will subsidize
75% of the cost of providing medical and dental insurance for the Executive and
his family.
(b) Reimbursement for all professional, education and license
fees.
7. BUSINESS EXPENSE. The Executive shall be reimbursed for all
usual expenses incurred on behalf of the Company, in accordance with Company
practices and procedures, provided that:
(a) Each such expenditure is of an nature qualifying it as a
proper deduction on the federal and state income tax returns of the Company as a
business expense and not as deductible compensation to Executive; and
(b) Executive furnished the Company with adequate documentary
evidence required by federal and state statutes and regulations for the
substantiation of such expenditures as deductible business expenses of the
Company and not as deductible compensation to Executive.
2
8. AUTOMOBILE EXPENSE. During the Employment period, Executive shall be
entitled to reimbursement by the Company for Executive's monthly automobile
allowance in the amount of $500 per month, commencing January 1, 1998.
Automobile expenses including gas, oil and tolls shall be reimbursed commencing
January 1, 1997.
9. VACATION. Employee shall be entitled to a paid vacation of three (3)
calendar weeks per year for the duration of the Employment Period. Any unused
vocation time for each calendar year of the Employment Period shall be forfeited
by Executive if not used during such year. Executive shall also be entitled to
all paid holidays made generally available by the Company to its executive
officers.
10. DEATH OR DISABILITY. Notwithstanding anything to the contrary
contained in Paragraph 1 above, if, while the Executive is employed by the
Company,he dies or suffers a physical or mental disability which prevents him,
for a period of three (3) consecutive months, from performing his duties
hereunder in a satisfactory manner, his employment shall terminate effective the
date of death or the end of such three 93) month period, as applicable. In the
event of such termination, the Executive's compensation and fringe benefits (to
the extent practicable) shall be continued for a period of six (6) months after
such termination, and shall be paid to the Executive if he is alive, or to his
spouse, if deceased.
11. TERMINATION.
(a) This Agreement may be immediately terminated by the
Company at anytime during the Employment Period for cause.
(b) This Agreement may be terminated by either the Company,
without cause, or the Executive upon sixty (60) days written notice to the
other party.
(c) In the event of termination by the Company for cause or at
the election of the Executive, the Company shall be obligated only to continue
to pay to Executive his compensation, including any bonus compensation to which
Executive may be entitled to pursuant to Paragraph 4 hereof, earned up to the
date of termination under Paragraph 3. In addition, Company shall pay any vested
benefits, if any, owed to Executive under any plan provided for Executive under
Paragraph 6 hereof in accordance with the terms of such plan as in effect on the
date of termination of employment under this Paragraph 11.
(d) In the event of termination by the Company without cause,
the Company shall be obligated to continue to pay Executive his compensation
earned up to the date of termination, including any bonus compensation to which
executive may be entitled to pursuant to Paragraph 4 hereof, plus continued
compensation for the remainder of the employment period, at the times and in the
manner as if such termination had not occurred. If such termination occurs after
December 31, 1998, the
3
Executive is to receive an additional amount of $200,000 within ten days of such
termination.
(e) For purpose of the Agreement, "cause" shall mean any act
involving gross negligence, gross misfeasance, gross malfeasance, willful
misconduct, or breach of any provision of this Agreement.
12. SUCCESSORS; BINDING AGREEMENT. The Company will require any
successor (whether direct or indirect, friendly or hostile, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company to compensate the Executive on the same terms as he would
be entitled to hereunder if he was terminated without cause under Paragraph
11(b) and (d), except that for purposes of implementing the foregoing, the date
on which any such succession becomes effective shall be deemed the Date of
Termination. As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid.
13. RESTRICTIVE COVENANTS.
(a) Executive recognizes that he has acquired knowledge of
certain trade secrets, information, data, know-how and knowledge (including, but
not limited to, trade secrets, information, date, know-how and knowledge
relating to customers, suppliers, sales market programs, costs, products,
apparatus, equipment, processes, manufacturing methods, compositions, designs,
plans and employees) belonging to, or relating to the affairs of the Company
(collectively referred to as "Trade Secrets"). Accordingly, during the
Employment Period and at all times thereafter, Executive agrees not to divulge,
communicate, use to the detriment of the Company or for the benefit of any other
person or persons, or misuse in any way, any Confidential Information or Trade
Secrets relating to the Company and its business, Executive acknowledges and
agrees that any information or data he has acquired on any of these matters or
items was received in confidence and as a fiduciary of the Company.
(b) all times during the Employment Period and thereafter,
Executive shall not, directly or indirectly, induce, influence, combine or
conspire with, or attempt to induct, influence, combine or conspire with, any of
the officers, employees, or consultants of the Company to terminate their
employment with or compete against the Company or any future subsidiaries,
parents or affiliates of the Company in the business of wholesale distribution,
exportation of pharmaceuticals, and providing without limitation, support,
durable medical equipment sale and rental, laboratory testing, x-ray speech,
physical therapy, and consulting services to the Long Term Care, Institutional
Care, and Alternate Care markets and provides mail service pharmaceuticals and
pharmacy benefits management for others (the "Business").
4
(c) Executive acknowledges that his services and
responsibilities are unique in character and are of particular significance to
the Company, that the Company is a competitive business with a worldwide market
and Executive's continued and exclusive service to the Company under this
Agreement is of a high degree of importance to the Company. Therefore, during
the Employment Period and, if Executive is either terminated for cause or
voluntarily terminates his employment with the Company, for an additional period
of two (2) years following the date Executive is terminated or voluntarily
terminates his employment with the Company (the "Noncompete Period"), for any
reason whatsoever, Executive shall not, directly or indirectly, engage in the
business, except as an employee or agent of the Company, and shall not, directly
or indirectly, as owner, partner, joint venturer, employee, broker, agent,
corporate officer, principal, licensor, shareholder (unless as owner of no more
than five percent (5%) of the issued and outstanding capital stock of such
entity if such stock is traded on a major securities exchange or otherwise as a
purely passive shareholder) or in any other capacity whatsoever, engage in or
have any connection with any business which is competitive with the Business,
and which operates anywhere in the world. In the event Executive is terminated
by the Company without cause prior to the expiration of the Employment Period,
the Noncompete Period shall be modified such that it expires on the date of such
involuntary termination.
(d) If, in any judicial proceeding, a court shall refuse to enforce any
of the covenants included in this Paragraph 13, then such enforceable covenant
shall be amended to relate to such lesser period or geographical area as shall
be enforceable. In the event the Company or Purchaser should bring any legal
action or other proceeding against Executive for enforcement of this Agreement,
the calculation of the Noncompete Period, if any, shall not include the period
of time commencing with the filing of legal action or other proceeding to
enforce this Agreement through the date of final judgment or final resolution,
including all appeals, if any, of such legal action or other proceeding unless
the Company is receiving the practical benefits of this Paragraph 13 during such
time. The existence of any claim or cause of action by Executive against the
Company predicated on this Agreement shall not constitute a defense to the
enforcement by the Company of these covenants.
(e) Executive hereby acknowledges that the restrictions on his activity
as contained in this Agreement are required for the Company's reasonable
protection and is a material inducement to the Company to enter into this
Agreement. executive hereby agrees that in the event of the violation by him of
any of the provisions of this Agreement, the Company will be entitled to
institute and prosecute proceedings at law or in equity to obtain damages with
respect to such violation or to enforce the specific performance of this
Agreement by Executive or to enjoin Executive from engaging in any activity in
violation hereof.
5
14. BINDING EFFECT. Except as herein otherwise provided, this Agreement
shall inure to the benefit of and shall be binding upon the parties hereto,
their personal representatives, successors, heirs and assigns.
15. SEVERABILITY. Invalidity or unenforceability of any provision
hereof shall in no way affect the validity of enforceability of any other
provisions.
16. TERMINOLOGY. All personal pronouns used in this Agreement, whether
used in the masculine, feminine or neuter gender, shall include all other
genders; the singular shall include the plural and vice versa. Titles of
paragraphs are for convenience only, and neither limit nor amplify the
provisions of the Agreement itself.
17. GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the law of the State of Florida.
18. ENTIRE AGREEMENT. This Agreement contains the entire understanding
between the parties and may not be changed or modified except by an agreement in
writing signed by all the parties.
19. NOTICE. Any notice requiring or permitted to be delivered hereunder
shall be deemed to be delivered when deposited in the United States mail,
postage prepaid, registered or certified mail, return receipt requested,
addressed to the parties at addresses first stated herein, or to such other
address as either party hereto shall from time to time designate to the other
party by notice in writing as provided herein.
20. OTHER INSTRUMENTS. The parties hereby covenant and agree that they
will execute such other and further instruments and documents as are or may
become necessary or convenient to effectuate and carry out the terms of this
Agreement.
21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each such counterpart shall for all purposes be deemed an
original.
22. ASSIGNABILITY. This Agreement shall not be assigned by either
party, except with the written consent of the other.
23. ATTORNEYS' FEES. In any litigation arising out of this Agreement,
the prevailing party shall be entitled to all costs and expenses, including
reasonable attorneys' fees.
6
IN WITNESS WHEREOF, this Agreement has been duly signed by the
Executive and on behalf of the Company on the day and year first above written.
COMPSCRIPT, INC. EXECUTIVE
By: /S/ XXXXX XXXXX /S/ XXXX XXXXXX
-------------------------- ----------------------
Xxxxx X. Xxxxx Xxxx Xxxxxx
Chief Executive Officer
7
