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EXHIBIT 10.11
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "Employment Agreement"), dated as of
January 12, 2000 (the "Effective Date"), by and between, Xxxxxxx.xxx, Inc., a
Delaware corporation, with an address at 00 Xxxx 00xx Xxxxxx, 0xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000 (the "Company"), and Xx. Xxxxxxx Xxxxxxxxxx, an Employee
with an address at 0000 Xxx Xxxx Xxxxx Xxxxx, Xxxxx Xxxx, XX 00000 (the
"Employee").
W I T N E S S E T H:
WHEREAS, pursuant to that certain merger (the "Merger")
contemplated by the Agreement and Plan of Merger dated as of January 12, 2000,
among the Company and American Medical Communications, Inc., the Employee
desires to be employed by the Company and Company desires to employ the
Employee;
WHEREAS, the Company and the Employee desire to express the
terms and conditions of the employment by the Company of the Employee;
NOW THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged by the parties hereto, the parties hereto hereby
agree as follows:
1. Employment. Contingent upon the closing of the Merger, the Company
hereby agrees to employ the Employee, and the Employee hereby accepts and agrees
to such employment, commencing as of the date hereof, upon the terms and
conditions hereinafter set forth.
2. Term. The term of the Employee's employment under this Agreement
shall commence as of the date hereof and shall continue for a period of two (2)
years from the date hereof, unless sooner terminated as provided elsewhere in
this Agreement (the "Initial Term"). The Initial Term hereof will be
automatically renewed for additional terms (each a "Renewal Term," and,
together, with the Initial Term, collectively the "Term") of one (1) year unless
either party hereto provides the other party hereto written notice of its
election not to renew this Agreement thirty (30) days prior to the expiration of
the Initial Term, or, if applicable, thirty (30) days prior to the expiration of
any Renewal Term.
3. Duties and Services. (a) The Employee agrees, from and after the
date hereof, to serve the Company and its Affiliates (as defined below)
faithfully, diligently and to the best of his ability, as its Executive Medical
Editor with primary responsibility for creating value. During the Term, the
Employee shall report directly to the Chief Operating Officer of the Company.
The Employee shall devote his entire business time, energy and skill to such
activities on behalf of the Company, except as otherwise provided herein.
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(b) The Employee agrees to perform such other services as the
Company shall reasonably request, and to act in such capacities for the Company
and its Affiliates (as hereinafter defined), as may be designated by the
Management of the Company, without further compensation other than that for
which provision is made in this Agreement. For purposes of this Agreement, the
term "Affiliate" shall refer to any entity which controls, is controlled by, or
is under common control with the Company.
(c) The Employee agrees that he shall work primarily at the
Company's main office located in New York, New York; provided, however, that
after the first six (6) months of the Term and with the mutual consent of the
Employee and the Company, the Employee's primary work location may be modified.
4. The Company's Assistance to the Employee. The Company shall supply
the Employee with all materials, data and technical assistance which shall be
reasonably necessary to assist the Employee. Such materials and the contents
thereof and all intellectual property referenced or represented therein shall
remain the property of the Company.
5. Compensation. (a) During the Term, the Company agrees to pay to the
Employee, and the Employee agrees to accept, a salary for all his services (the
"Salary") at the rate set forth on Table A hereto, payable in accordance with
the Company's standard payroll policies from time to time.
(b) The Employee agrees that the Company shall withhold from any
and all payments required to be made to the Employee pursuant to this Agreement
all federal, state, local and/or other taxes which are required to be withheld
in accordance with applicable statutes and/or regulations from time to time in
effect.
(c) Stock Option. The Company shall grant the Employee an option
(the "Option") to purchase 100,000 shares of the Company's Common Stock
effective on or about the Effective Date. The per share exercise price for the
Option shall be $7 per share. The term of the Option shall be ten (10) years.
The Option shall vest as to twenty percent (20%) of the shares subject to the
Option on each anniversary of the Effective Date. Should the Company provide the
Employee with notice as required by Section 2 so as to not extend the term of
this Employment Agreement, such non-renewal of this Employment Agreement will be
treated as an involuntary termination and the Option shall vest as to that
number of shares provided for in Section 7(e). Except as otherwise provided
herein, the Option shall be granted pursuant to, and shall be governed by, the
Company's Stock Option Plan and Stock Option Agreement and conform to the
Company's standard policies with respect to options. To the extent permitted
under applicable law, the Option shall be an incentive stock option.
6. Employee Benefits. (a) In accordance with the policies of the
Company, the Company shall reimburse the Employee for pre approved business
expenses incurred by him for or on behalf of the Company in furtherance of the
performance of his duties hereunder. Such reimbursement shall be subject to
receipt by the Company from the Employee of an itemized accounting therefor,
together with such vouchers and other reasonable verifications as the Company
shall require to
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satisfactorily evidence such expenses, and such policies as the Company shall
establish from time to time.
(b) The Employee shall be entitled to participate, in accordance
with the terms thereof, in employee benefit plans maintained for the Employees
of the Company including, without limitation, any health, hospitalization and
medical insurance programs and in any pension or retirement or other similar
plans or policies. The foregoing shall not be construed to require the Company
to establish any such plans, or to prevent the Company from modifying or
terminating any such plans once established. The Employee shall be entitled to
the vacation, benefits and sick days set forth on Table A hereto.
7. Termination. (a) Notwithstanding anything to the contrary contained
herein, the Company's employment of the Employee under this Agreement and the
Employee's right to any and all compensation to which the Employee would
otherwise be entitled hereunder, shall terminate upon the earliest to occur of
the following events:
(i) The death of the Employee.
(ii) The permanent disability (as hereinafter defined) of the
Employee.
(iii) The expiration of the Term, pursuant to Section 2
hereof.
(iv) Upon written notice to the Employee from the Company for
Cause (as hereinafter defined).
(v) Upon 2 weeks' written notice to the Employee from the
Company without Cause.
(vi) Upon 2 weeks' written notice to the Company from the
Employee.
(b) "Cause" for purposes hereof shall mean: (i) the
commission by the Employee of theft, embezzlement, fraud, obtaining funds or
property under false pretenses, or similar acts of material misconduct with
respect to the property of the Company or any of its Affiliates or their
respective employees or the Company's customers or suppliers, or the Company's
good faith determination that any oral or written representations made to the
Company by the Employee shall prove false after the Employee has been provided
an opportunity to address the claim; (ii) the commission by the Employee of a
material act of malfeasance, dishonesty or breach of trust against the Company
or any of its Affiliates or their respective employees or the Company's
franchisees, customers or suppliers, including a breach by the Employee of his
covenants or obligations under Section 9 of this Agreement; (iii) the conviction
of the Employee of a felony or of a misdemeanor involving moral turpitude; or
(iv) the Employee's repeated and continued failure to successfully fulfill his
duties or obligations of employment or the Employee's breach of any of his
material obligations and covenants hereunder after having been given reasonable
notice from the Company and the Employee's failure to cure within ten (10) days,
or such other period as the parties agree upon, of such notice.
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(c) No waiver by the Company of any default by the
Employee or any breach by him of any of his covenants or obligations under any
provision of this Agreement shall be deemed a waiver of any future breach or
default, whether or not such breach or default is of the same nature.
(d) The Employee shall be deemed to be permanently
disabled for purposes hereof, at the option of the Company, in the event that
the Employee shall fail to render and perform the services required of the
Employee under this Agreement because of physical or mental incapacity or
disability for a continuous period of three (3) consecutive months, or for
shorter periods aggregating one hundred and twenty (120) days or more during any
period of six (6) successive months.
(e) Severance Payments upon Involuntary Termination. If
the Employee's employment is involuntarily terminated by the Company other than
for Cause (not including the Employee's death or disability or the non-renewal
of this Agreement by the Employee), and the Employee signs and does not revoke a
release of claims, which shall be provided to the Employee by the Company, then,
subject to the Employee's continued compliance with Sections 8 and 9 of this
Employment Agreement, (i) the Company shall pay Employee's Salary to the
Employee for a period of twelve (12) months, to be paid in accordance with the
Company's standard payroll practices and (ii) up to 20,000 of the unvested
shares subject to the Option shall immediately vest and become exercisable.
8. Effect of Termination. Upon the termination of this Agreement, for
any reason, or upon the termination of the Employee's employment hereunder, for
any reason, the Employee (i) shall immediately discontinue the use of any and
all trade names, trademarks, trade secrets, copyrights or copyrighted materials,
and customer lists, offering circulars and materials and advertising media
belonging to or supplied to the Employee by the Company, and (ii) shall, at the
Employee's expense, return to the Company all such materials.
9. Non-Competition, Restrictive Covenants, Confidentiality and
Injunctive Relief. (a) The Employee agrees that, commencing as of the date
hereof and during the term of the Employee's employment with the Company
(including any Period for which the Employee shall act as a consultant to the
Company), and for a period of one (1) year thereafter, the Employee shall not,
without the prior written approval of the Board of Directors of the Company,
directly or indirectly, through any other person, firm or corporation, whether
for himself or as agent on behalf of any other person or entity, and whether as
employee, consultant, agent, principal, lender, partner, officer, director,
stockholder or otherwise, with our without compensation:
(i) sell products or provide services which are
competitive with the businesses, products or services of the Company or the
business, products or services of the Company under development (the
"Businesses"), or promote, market, sell, become or acquire an interest in, or
associate in a business relationship with, or aid or assist any other person,
corporation, firm, partnership or other entity whatsoever who is engaged in any
line of business competitive with the Businesses;
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(ii) become an employee, consultant, agent, principal,
lender, partner, officer, director, stockholder or otherwise provide services to
or on behalf of any entity (A) which the Board reasonably determines is or could
become a competitor of the Company or the Businesses or (B) which as of the date
of this Agreement is a business partner or contractual party with the Company;
(iii) solicit or refer, directly or indirectly, any
clients or prospective clients of any services and/or products offered by the
Company (or which are competitive with those offered by the Company) to any
other provider of such services;
(iv) promote, market, assist or participate in the
development, sale, lease or licensing of any services and/or products
competitive with those provided by the Company to, for or with any person,
corporation, firm, partnership or other entity whatsoever; or
(v) solicit, raid, entice, induce or assist any person
who presently is, or any time during the Employee's employment with the Company
shall be or shall have been an employee of the Company or any of its Affiliates
during the twelve (12) months preceding such solicitation, raid, enticement,
inducement or assistance, to become employed or retained by any other person or
entity.
(b) Recognizing that the Employee's knowledge,
information and relationship with existing or prospective clients, licensees,
customers, suppliers, accounts, agents, brokers and representatives of the
Company and its Affiliates, and the knowledge of the business, methods, systems,
plans and policies of the Company and its Affiliates which the Employee has
heretofore and shall hereafter establish, receive or obtain as an employee of
the Company or in connection with services performed for the Company or any such
Affiliates, are valuable and unique assets of the Company and such Affiliates,
the Employee agrees that, at all times during and after the Employee's
employment by the Company, the Employee shall not (otherwise than pursuant to
his duties hereunder), directly or indirectly, use, divulge, furnish or make
accessible to anyone, without the prior written consent of the Board of
Directors of the Company, any such confidential or proprietary knowledge or
information pertaining to the Company or any of its Affiliates, or the business,
shareholders, personnel, methods, systems, plans or policies thereof, to any
person, firm or corporation or other entity, for any reason or purpose
whatsoever.
(c) The Company shall be deemed and entitled to own
all of the results and proceeds of the Employee's services, including all right,
title and interest in and to any and all franchises, products, processes,
concepts, methods, ideas, creations, designs and/or systems (including, without
limitation, all those of an advertising, marketing or promotional nature), and
any improvement thereon, which may be developed, created or devised by the
Employee during the term of his employment by the Company that are in
conjunction with the Business. The Employee will, at the request of the Company,
and without further compensation other than that for which provision is made in
this Agreement, execute such assignments, certificates or other instruments as
the Company may from time to time deem necessary or desirable to evidence,
establish, maintain, perfect, protect, enforce or defend its right, title and
interest in or to any of the foregoing. Without limiting the generality of the
previous sentences, the Employee acknowledges and agrees that all memoranda,
notes, records, customer lists and other documents made or compiled by the
Employee
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or made available to the Employee during the term of his employment by the
Company concerning the Business of the Company and/or any of its Affiliates
shall be the Company's property and shall be delivered by the Employee to the
Company upon termination of his employment by the Company or at any other time
on the Company's request.
(d) The Employee shall execute and deliver to and for
the benefit of the Company an agreement substantially in the form of Exhibit
9(d) hereto, pertaining, among other matters, to Proprietary Information and
Inventions (as such terms are defined in said Exhibit 9(d)) and confidentiality
obligations, the provisions of which shall be deemed incorporated herein by
reference as if set forth herein (the "Proprietary Rights Agreement").
(e) The provisions of this Section 9 shall survive
the termination or expiration of this Agreement, irrespective of the reason
therefore, including under circumstances in which the Employee continues
thereafter in the employ of the Company.
(f) The Employee acknowledges that the services to be
rendered by him are of a special, unique and extraordinary character and, in
connection with such services, the Employee will have access to confidential
information vital to the business of the Company. By reason of the foregoing,
the Employee consents and agrees that, if he violates any of the provisions of
this Section 9, the Company would sustain irreparable harm and, therefore, in
addition to any other remedies which the Company may have under this Agreement
or otherwise, the Company shall be entitled to apply (without the necessity of
posting any bond) to any court of competent jurisdiction for an injunction
restraining the Employee or any other party from committing or continuing any
such violation (or participating therein) of this Agreement, and the Employee
shall not object to any such application.
(g) Notwithstanding anything in this Agreement to the
contrary and provided that the following activities do not violate the terms of
this Section 9, the Employee shall have the right to teach one course per year
at Notre Dame University and shall have the right to continue certain media and
authorship activities which are pre-approved by the Company.
10. Warranty. The Employee warrants and represents that he is not a
party to any agreement, contract or understanding, whether of employment or
otherwise, which would in anyway restrict or prohibit the Employee from
undertaking his position as an employee of the Company and complying with his
obligations in accordance with the terms and conditions of this Agreement.
11. Notices. All notices shall be in writing and shall be deemed to
have been duly given to a party hereto on the date of such delivery, if
delivered personally, or on the third day after being deposited in the mail if
mailed via registered or certified mail, return receipt requested, postage
prepaid, or on the next business day after being sent by recognized national
overnight courier services, at the addresses of the parties as set forth in the
first paragraph of this Agreement, or such other address as the parties may
specify in writing from time to time in accordance herewith.
12. Severability. In the event that any provisions of this Agreement
would be held to be invalid, prohibited or unenforceable in any jurisdiction for
any reason (including, but not limited to, any provisions which would be held to
be unenforceable because of the scope, duration or area of its
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applicability), unless narrowed by construction, this Agreement shall, as to
such jurisdiction only, be construed as if such invalid, prohibited or
unenforceable provision had been more narrowly drawn so as not to be invalid,
prohibited or unenforceable (or if such Language cannot be drawn narrowly
enough, the court making any such determination shall have the power to modify
such scope, duration or area or all of them, but only to the extent necessary to
make such provision or provisions enforceable in such jurisdiction, and such
provision shall then be applicable in such modified form in such jurisdiction
only). If, notwithstanding the foregoing, any provision of this Agreement would
be held to be invalid, prohibited or unenforceable in any jurisdiction, such
provision shall be ineffective to the extent of such invalidity, prohibition or
unenforceability, without invalidating the remaining provisions of this
Agreement or affecting the validity or enforceability of such provision in any
other jurisdiction.
13. Assignment. Subject to Section 14, nothing in this Agreement shall
be construed to permit the assignment by the Employee or by the Company of any
of the rights or obligations hereunder, and such assignment is expressly
prohibited without the prior written consent of both of the parties.
14. Successors. (a) Any successor to the Company (whether direct or
indirect and whether by purchase, lease, merger, consolidation, liquidation or
otherwise) to all or substantially all of the Company's business and/or assets
shall assume the obligations under this Agreement and agree expressly to perform
the obligations under this Agreement in the same manner and to the same extent
as the Company would be required to perform such obligations in the absence of a
succession. For all purposes under this Agreement, the term "Company," shall
include any successor to the Company"s business and/or assets which executes and
delivers the assumption agreement described in this subsection (a) or which
becomes bound by the terms of this Agreement by operation of law.
(b) The terms of this Agreement and all rights of the Employee
hereunder shall inure to the benefit of, and be enforceable by, the Employee"s
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
15. Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York, without regard to
principles of conflict of laws and regardless of where actually executed,
delivered or performed.
16. Forum Selection. The parties agree that the exclusive remedy for
resolving any disputes arising under this Agreement shall be by submitting them
to the American Arbitration Association ("AAA") for adjudication in New York,
New York pursuant to the AAA's National Rules for the Resolution of Employment
Disputes, except to the extent there is no adequate remedy at law and injunctive
relief only is sought in which case the parties select state court in New York,
New York as the exclusive forum to resolve their disputes and both parties
submit to personal jurisdiction and consent to service of process at the
addresses contained in the first paragraph of this Agreement.
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17. Waiver. No waiver by either party hereto at any time of any breach
by the other party hereto of, or compliance, with, any condition or provision of
this Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time.
18. Complete Understanding; Drafting Counterparts. This Agreement, the
Company's Stock Option Plan and Stock Option Agreement constitute the complete
understanding and supersede any and all prior agreements and understandings
between the parties with respect to its subject matter and no statement,
representation, warranty or covenant has been made by either party with respect
thereto except as expressly set forth herein. This Agreement shall not be
altered, modified, amended or terminated except by written instrument signed by
each of the parties hereto. The language used in this Agreement will be deemed
to be the language chosen by both of the parties to express their mutual intent,
and no rule of strict construction shall be applied against either party. The
Section and paragraph headings contained herein are for convenience only, and
are not part of and are not intended to define or limit the contents of said
Sections and paragraphs. This Agreement may be executed in counterparts, each of
which shall be deemed an original and all of which, when taken together, shall
constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
THE COMPANY:
XXXXXXX.XXX, INC.
By:_________________________________
Name: Xxxxxxx Xxxxx
Title: Chief Financial Officer
THE EMPLOYEE:
By:_________________________________
Name: Xxxxxxx X. Xxxxxxxxxx, Xx., M.D.
[signature page to Friedewald Employment Agreement]
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TABLE A
SALARY (PER ANNUM):
- $ 220,000 payable at a rate of $20,000 per month for the first
six (6) months of the Term and at a rate of $16,666 per month
thereafter. o
- For purposes of Section 7(e) of the Agreement, the Salary
shall be payable at a rate of $20,000 per month for the first
six (6) months and at a rate of $16,666 per month for the next
six (6) months.
VACATION DAYS:
20 Days
FLOATING HOLIDAYS:
3 Days
SICK DAYS:
5 Days
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