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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into this 12th
day of March, 1996 by and between SYSTEMS COMMUNICATIONS, INC., a Florida
corporation, located at Xxxxx 000, 0000 Xxxxxxxx Xxxx, Xxxxxxxxxx, XX 00000
(hereinafter called "SCI") and HEALTH MANAGEMENT TECHNOLOGIES, INC., a
California corporation, located at 0000 Xxxxxx Xxx, Xxxxx 000, Xxxxxx, XX
00000 (hereinafter called "HMT") and XXXX X. XXXXX (hereinafter called
"Employee").
WHEREAS, SCI has acquired HMT as a wholly owned subsidiary of SCI; and
WHEREAS, SCI and HMT desire to retain Employee in the position of Senior
Vice- President, Client Services for HMT; and
WHEREAS, SCI, HMT and Employee desire to enter into this Agreement to assure
HMT of the services of Employee for the benefit of HMT and to set forth the
respective rights and duties or the parties hereto;
WHEREAS, HMT is in the business of developing and implementing software to
track and analyze healthcare provided to individuals for use by employers and
insurance companies throughout the United States (hereinafter called the
"Business");
NOW, THEREFORE, in consideration of the premises and the mutual covenants,
terms and conditions set forth herein, SCI, HMT and Employee agree as follows:
ARTICLE I
Employment
1.1 Employment and Title. HMT hereby employs Employee, and Employee hereby
accepts such employment as the Senior Vice-President, Client Services of HMT,
all upon the terms and conditions set forth herein.
1.2 Description of Services to be Performed.
(a) The duties to be performed by Employee are: Plan all software product
development and programming, manage technical programming staff (9),
hire and manage technical consultants as necessary, programming, product
quality assurance, supervise technical equipment acquisition and
maintenance, supervise payroll.
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(b) During the terms (as hereinafter defined) hereof, Employee agrees to
perform diligently and in good faith such duties and services for HMT
as are consistent with the position held by Employee under the direction
of the Board of Directors of SCI (the "Board of Directors"). Employee
agrees to devote his best efforts and all of his full business time,
energies and abilities to the services to be performed hereunder and for
the exclusive benefit of the HMT. Employee shall be vested with such
authority as is generally concomitant with the position to which he is
appointed.
(c) Employee shall assist the President of HMT in communication and reports
to SCI, on a periodic (monthly as minimum) basis as to the operations,
sales activity, industry developments and prospects for the Business of
HMT.
1.3 Location. The principal place of employment and the location of
Employee's principal office and ordinary place of work shall be in Moraga,
California, provided, however, Employee shall, when requested by the SCI or the
Board of Directors, or may, if he determines it to be reasonably necessary,
temporarily perform services outside said area as are reasonably required for
the proper performance of his duties under this Agreement.
1.4 Representations. Each party represents and warrants to the other that
he/it has full power and authority to enter into and perform this Agreement and
this his/its execution and performance of his Agreement shall not constitute a
default under or breach of any of the terms of any agreement to which he/it is
a party or under which he/it is bound. Each party represents that no consent
or approval of any third party is required for his or its execution, delivery
and performance of this Agreement or that all consents or approvals of any
third party required for his or its execution, delivery and performance of this
Agreement have been obtained.
ARTICLE II
2.1 Term. The term of Employee's employment hereunder (the "Term") shall
commence as of the date hereof (the "Commencement Date") and shall continue
from the date hereof for a period of three (3) years unless earlier terminated
by HMT or SCI's Board of Directors or Employee pursuant to the provisions of
this Agreement.
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ARTICLE III
Compensation
3.1 Base Salary. As compensation for the services to be rendered by Employee,
HMT shall pay Employee, during the term of this Agreement, an annual base
salary of $100,000.00 which base salary shall (prorated for periods less than a
month) be paid in equal monthly installments. See Exhibit A.
3.2 Benefits. Employee shall be entitled, during the Terms hereof, to the
same medical, hospital, dental and life insurance coverage as are available to
SCI's senior executive officers on the Commencement Date and shall receive
additional benefits (now being developed) as shall be made available to persons
of comparable salary and position in other subsidiaries of SCI.
Employee shall be entitled to four (4) weeks of fully paid vacation per year
during the term of this Agreement. Employee shall not be entitled to receive
monetary or other valuable consideration for vacation time to which he is
entitled but does not take. The timing of vacation periods shall be within the
discretion of HMT, reasonably exercised so as not to unnecessarily
inconvenience the Employee.
3.3 Withholding. Any and all amounts payable under this Agreement, including,
without limitation, amounts payable in the event of the termination hereof
under Article V hereof, are subject to withholding for such federal, state and
local taxes as HMT in its reasonable judgment determines to be required to any
applicable law, rule or regulation.
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ARTICLE IV
Working Facilities, Expenses and Insurance
4.1 Working Facilities and Expenses. Employee shall be furnished with an
office at the principal office of HMT, or at such other working facilities and
secretarial and other assistance suitable to his position and adequate for the
performance of his duties hereunder. HMT shall reimburse Employee for all of
Employee's reasonable expenses incurred while employed and performing his
duties under and in accordance with the terms and conditions of the Agreement,
subject to Employee's full and appropriate documentation, including, without
limitation, receipts for all such expenses in the manner required pursuant to
HMT's policies and procedures and the Internal Revenue Code as in effect from
time to time.
4.2 Insurance. HMT or SCI may secure in its own name or otherwise, and at its
own expense, life, disability and other "key man" type insurance covering
Employee or Employee or others, and Employee shall not have any right, title or
interest in or to such insurance other than as expressly provided herein.
Employee agrees to assist in procuring such insurance by submitting to the
usual and customary medical and other examination to be conducted by such
physician(s) as the Board of Directors or such insurance company may designate
and by signing such applications and other written instruments as may be
required by the insurance companies to which application is made for such
insurance.
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ARTICLE V
Termination
5.1 Termination. This Agreement and the employment of Employee may be
terminated only as follows:
(a) at the election of the Employee;
(b) on the Scheduled Termination Date; or
(c) for cause as set forth on Paragraph 5.2.
5.2 Termination for Cause. "Employee shall be deemed to have been terminated
for cause by HMT if he has committed any material act of dishonesty, has
disclosed confidential information to third parties without authority, has
breached any of his obligations hereunder, is guilty of gross carelessness or
misconduct, has unjustifiably neglected his duties under this Agreement, or has
conducted himself in a manner substantially detrimental to HMT or SCI. If
employee is terminated for cause, he shall be entitled to no severance pay and
shall be entitled to no payment(s) that might otherwise be owed to him even if
he worked for the entire year. In addition, Employee shall be entitled to
receive any benefits which are, at the time of the termination, vested
pursuant to Paragraph 3.2 herein.
5.3 Effect of Termination. If the Employee voluntarily terminates his
employment, or in the event the employment is terminated upon death or
disability of the Employee:
(a) Salary shall be paid through the date of voluntary
resignation or termination.
(b) Employee shall be entitled to reimbursement for expenses
accrued through the date of termination in accordance with the
provisions of Section 3.1 hereof.
(c) Employee shall receive such other benefits as may be provided
under the terms hereof and the benefit plans mentioned in
Paragraphs 3.1 and 3.2 herein.
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ARTICLE VI
Covenant Not to Compete
6.1 Covenant Not to Compete. Upon termination of this Agreement by either the
voluntary resignation of Employee or a termination for cause by HMT or SCI,
Employee shall not directly or indirectly, (within any of the metropolitan
areas within the United States of America in which HMT at the time of such
termination is conducting Business, and also all metropolitan areas within the
United States of America in which Employee knows that HMT intends to extend and
carry on Business by expansion of its activities) enter into or engage in any
business in competition with the Business of HMT, as it now exists or may exist
at the time of termination of employment under this Agreement, either as an
individual on his own account, or as a partner, joint venture, employee, agent,
or salesperson for any person, or as an officer, director or stockholder of a
corporation, or otherwise for a period of three (3) years after the date of
termination of employment hereunder. It is agreed by the parties that this
covenant on the part of the Employee may be enforced against Employee by HMT or
SCI by injunction, as well as by all other legal remedies available to HMT or
SCI. It is agreed by the parties hereto that if any portion of this covenant
not to compete is held to be unreasonable, arbitrary or against public policy,
the covenant herein shall be considered divisible both as to time and
geographic area so that a lesser period of time or geographical areas shall
remain effective so long as the same is not unreasonable, arbitrary, or against
public policy. The parties hereto agree that, in the event any Court
determines the specified time period or the specified geographical area to be
unreasonable, arbitrary, or against public policy, a lesser time period or
geographical area which is determined by the courts to be reasonable,
non-arbitrary and not against public policy may be enforced against Employee by
injunction, as well as by all other legal remedies available to HMT or SCI.
6.2 Solicitation of Employees. For a period of three years after he is no
longer employed by HMT, the Employee will not, directly, or indirectly, either
as an individual, proprietor, stockholder, partner, officer, director, employee
or otherwise, solicit any officer, director, employee or other individual:
(A) To leave his or her employment or position with HMT;
(B) To compete with the Business of HMT or SCI; or
(C) To violate the terms of any employment; noncompetition or similar
agreement with HMT or SCI.
For purposes of this paragraph, references to the Business of HMT or SCI shall
include the business of any subsidiary or affiliate of HMT or SCI.
6.3 (a) Employee agrees that in the event of a breach of any term of this
Agreement, and more particularly, in the event of the breach of any of the
terms and provisions of this Article VI, HMT shall be entitled to secure an
order in any suit brought for that purpose to enjoin Employee from violating
any of the provisions of this Agreement and that, pending the hearing and the
decision on the application for such order, HMT shall be entitled to a
temporary restraining order without prejudice to any other remedy available to
HMT, all at expense of Employee. EMPLOYEE UNDERSTANDS THAT THE COVENANTS OF
THIS PARAGRAPH ARE THE ESSENCE OF THIS EMPLOYMENT AGREEMENT, WITHOUT WHICH NO
EMPLOYMENT AGREEMENT WOULD BE ENTERED INTO BY HMT AND/OR SCI.
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(b) The provisions of Article VI shall in no event be construed to be an
exclusive remedy, and such remedy shall be held and construed to be cumulative
and not exclusive of any rights or remedies, whether in law or equity,
otherwise available under the terms of this Agreement or under the laws of the
United States or any state.
ARTICLE VII
Confidentiality and Intellectual
Property Rights
7.1 Confidentiality. The Employee will not at any time during or after his
employment by HMT, directly or indirectly, divulge, disclose or communicate to
any person, firm or corporation in any manner whatsoever, other than in the
normal course of performing his duties for HMT, any information concerning any
matter affecting or relating to HMT or the Business of HMT. While engaged as
an employee of HMT, the Employee may only use information concerning any
matters affecting or relating to HMT or the Business of HMT for a purpose which
is necessary to the carrying out of the Employee's duties as an employee of
HMT, and the Employee may not make use of any information of HMT after he is no
longer an employee of HMT. The Employee agrees to the above without regard to
whether all of the above matters will be deemed confidential, material or
important, it being stipulated by the parties that all information, whether
written or otherwise, regarding HMT's Business, including but not limited to,
information regarding customers, customer lists, employees, employee salaries,
costs, prices, earnings, and any financial or cost accounting reports,
products, services, formulae, compositions, machines, equipment, apparatus,
systems, manufacturing procedures, operations, potential acquisitions, new
location plans, prospective and executed contracts and other business
arrangements, and sources of supply, is presumed to be important, material and
confidential information of HMT for purposes of this Agreement, except to the
extent that such information may be otherwise lawfully and readily available to
the general public. Employee agrees that all of this information is a trade
secret owned exclusively by HMT which shall at all times be kept confidential.
The Employee further agrees that he will, upon termination of his employment
with HMT, return to HMT all books, records, lists and other written, typed or
printed materials, whether furnished by HMT or prepared by the Employee, which
contain any information relating to HMT's Business, and the Employee agrees
that he will neither make nor retain any copies of such materials after
termination of employment. For purposes of this Article VII, references to the
Business or information of or relating to HMT shall include the information or
business of HMT, SCI and any subsidiary or affiliate of HMT or SCI, including
but not limited to, National Solutions Corporation.
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7.2 Business Opportunities and Patentable Devices. Employee will make full
and prompt written disclosure to HMT, SCI or their nominee of:
(A) Any business opportunity of which he becomes aware and which relates
to the Business of HMT, SCI or any of its subsidiaries or affiliates;
and
(B) Any patentable device, apparatus, method, process or improvement
which he may invent or discover, either solely or jointly with any
other person or persons, resulting from or in the course of any work
done by him as an employee of HMT, or relating to the work or duties
he was employed or assigned to perform or actually does perform for
HMT, or relating to any phase of HMT's business or fields of interest
in each case whether or not a patentable device, apparatus, method,
process or improvement is:
(1) Related to the project to which he is so assigned;
(2) Made with a contribution by HMT or the use of HMT or HMT-held
facilities, equipment, materials, allocated funds, proprietary
information, or services of HMT or SCI employees or associated
persons;
(3) Made during working hours; or
(4) Made before, during or within a period of three years after the
period of Employee's employment pursuant to this Agreement.
7.3 Assignment of Intellectual Property Rights. The Employee assigns to HMT
and/or SCI the entire right, title and interest for the entire world in and to
all work performed, writing(s), formula(s), design(s), model(s), drawing(s),
software, photograph(s), design invention(s) and other invention(s) made,
conceived or reduced to practice or authored by Employee, either solely or
jointly with others, during the performance on this Agreement or with the use
of information, materials or facilities of HMT received or used by Employee
during the period Employee is retained by HMT under this Agreement or any
extensions or renewals thereof.
The Employee shall sign, execute and acknowledge or cause to be signed,
executed and acknowledged without cost, but at the expense of HMT, any and all
documents and to perform the acts as may be necessary, useful or convenient for
the purpose of securing to HMT and/or SCI or its nominees trade secret, patent,
trademark, or copyright protection throughout the world upon all such work(s),
writing(s), photograph(s), software, design invention(s), other invention(s)
and processes, title to which HMT may acquire in accordance with the provisions
of this clause.
7.4 Nonassertion of Rights by Consultant or Others. During and after the
term of this Agreement, Employee shall not assert or permit any other party to
assert against HMT and/or SCI, its subsidiaries, vendors and customers, mediate
and immediate, any patent or other rights with respect to which Employee has
the right to assert or license at the termination or expiration of this
Agreement because of the practice of any process or the development, use or
sale of any saleable or licensable product arising out of the subject matter of
this Agreement.
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ARTICLE VIII
Miscellaneous
8.1 No Waivers. The failure of either party to enforce any provision of this
Agreement shall not be construed as a waiver of any such provision, nor prevent
such party thereafter from enforcing such provision or any other provision of
this Agreement.
8.2 Notices. Any notice to be given to the HMT, SCI and the Employee under
the terms of this Agreement may be delivered personally, by telecopy, telex or
other form of written electronic transmission, or by registered or certified
mail, postage prepaid, and shall be addressed as follows:
If to SCI: Systems Communications, Inc.
0000 Xxxxxxxx Xxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
If to HMT: Health Management Technologies, Inc.
0000 Xxxxxx Xxx
Xxxxx 000
Xxxxxx, XX 00000
If to the Employee: Xxxx Xxxxx
0000 Xxxxxx Xxx
Xxxxx 000
Xxxxxx, XX 00000
Either party may hereafter notify the other in writing of any change in
address. Any notice shall be deemed duly given (i) when personally delivered,
(ii) when telecopied, telexed or transmitted by other form of written
electronic transmission, or (iii) on the their day after it is mail by
registered mail or certified mail, postage prepaid, as provided herein.
8.3 Severability. The provisions of this Agreement are severable and if any
provision of this Agreement shall be held to be invalid or otherwise
unenforceable, in whole or in part, the remainder of the provision, or
enforceable parts thereof, shall not be affected thereby.
8.4 Successors and Assigns. The rights and obligations of the HMT or SCI
under this Agreement shall inure to the benefit of and be binding upon the
successors and assigns of HMT and/or SCI, including the survivor upon any
merger, consolidation or combination of HMT or SCI with any other entity.
Employee shall not have the right to assign, delegate or otherwise transfer any
duty or obligation to be performed by him hereunder to any person or entity.
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8.5 Entire Agreement. This Agreement supersedes all prior agreements and
understandings between the parties hereto, oral or written, and may not be
modified or terminated orally. No modification, termination, or attempted
waiver shall be valid unless in writing, signed by the party against
whom such modification, termination or waiver is sought to be enforced. This
Agreement was the subject of negotiation by the parties hereto and their
counsel. The parties agree that no prior drafts of this Agreement shall be
admissible as evidence in any proceeding which involves the interpretation of
any provision of this Agreement.
8.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Florida without reference to
the conflict of law thereof.
8.7 Section Headlines. The section headings contained herein are for the
purposes of convenience only and are not intended to define or limit the
contents of said sections.
8.8 Further Assurances. Each party hereto shall cooperate and shall take such
further action and shall execute and deliver such further documents as may be
reasonably requested by any other party in order to carry out the provisions
and purposes of this Agreement.
8.9 Gender. Whenever the pronouns "he" or "his" are used herein they shall
also be deemed to mean "him" or "his" or "it" or "its" whenever applicable.
Words in the singular shall be read and construed as though in the plural and
words in the plural shall be read and construed as though in the singular in
all cases where they would apply.
8.10 Counterparts. This Agreement may be executed in counterparts, all of
which taken together shall be deemed one original.
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8.11 Attorney's Fees. In the event that either party is required to engage
the services of legal counsel to enforce the terms and conditions of this
Agreement against the other party, regardless of whether such action results in
litigation, the prevailing party shall be entitled to reasonable attorneys'
fees, costs of legal assistants, and other costs from the other party, which
shall include any fees or costs incurred at trial or any appellate proceeding,
and expenses and other cost, including any accounting expenses incurred.
IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
as of the date first above written.
Attest: SYSTEMS COMMUNICATIONS, INC.
("SCI")
/s/ Xxxxx X. Salmon__________ By: /s/ Xxxxxxx X. Xxxxxxxx ____
Its_President___________________
/s/ Xxxxx Xxxxxxx Cox________
Witness
Attest: HEALTH MANAGEMENT
TECHNOLOGIES, INC.
("HMT")
_____________________________ By: /s/ Xxxxx Wolfe______________
Its President____________________
_____________________________
Witness
"Employee"
_____________________________ /s/ Xxxx X. Wolfe______________
Witness XXXX X. XXXXX
EXHIBIT A
In the event Xxxxx Xxxxx'x employment by HMT should be terminated because of
her death or disability prior to the end of 1996, 1997, or 1998, if the total
revenue and profitability of HMT nevertheless reach the goals set forth in
exhibits X-0, X-0, X-0 for any of those years, then Employee's contribution to
the achievement of those goals shall be rewarded by payment to Employee of 25%
of the amount of the performance bonus set forth on the relevant Exhibit.
