EMPLOYMENT AGREEMENT
BETWEEN
PHOENIX HEALTHCARE CORPORATION
AND
XXXX XXXX STILL
THIS AGREEMENT made and entered into as of the 1st day of January, 2000 by
and between Phoenix Healthcare Corporation, a Delaware corporation (the
"Corporation"), and Xxxx Xxxx Still, a resident of Texas (hereinafter referred
to as "Executive").
WHEREAS, the parties, for and in consideration of the mutual and
reciprocal covenants and agreements hereinafter contained, and intending to be
legally bound hereby, do contract and agree as follows:
1. PURPOSE AND EMPLOYMENT. The Corporation's primary business is the
deployment of a technology-enabled data, media and communications platform to be
used in the execution of its business-to-business and business-to-consumer
strategies in the healthcare, telecommunication, insurance and media industries
(the "Business"). The Corporation will, through wholly-owned subsidiaries,
develop, acquire and license software applications and technologies to be
marketed and distributed in Service Bureau and Application Service Provider
environments. The purpose of this Agreement is to define the relationship
between the Corporation and Executive. The Corporation hereby employs Executive,
and Executive hereby accepts employment by the Corporation, all upon the terms
and conditions hereinafter set forth.
2. POSITION AND SCOPE OF DUTIES.
(a) Executive shall serve the Corporation as its Executive Vice President.
At all times, Executive shall report to, discharge his duties in consultation
with and be under the direct supervision and control of the Corporation's
Chairman and Chief Executive Officer, shall perform such duties, consistent with
the Executive's employment as a senior corporate executive of the Corporation,
shall hold such other titles with respect to the Corporation, or any of its
divisions, subsidiaries, or affiliates, as the Corporation's Board of Directors
may from time to time determine, and shall comply with all applicable provisions
of the Corporation's certificate of incorporation. Executive shall, subject to
the direction of the Corporation's Chairman and Chief Executive Officer, have
authority to formulate policies for and oversee all aspects of the Corporation
and its divisions, subsidiaries, and affiliates. As to employees under his
jurisdiction, including those working directly under his supervision, Executive
shall use his best efforts (i) to employ and retain only employees who are
capable and willing to perform according to applicable legal requirements and
applicable policies of the Corporation, and also (ii) to assure that such
personnel are properly trained and supervised. Subject to the direction of the
Corporation's Chairman and Chief Executive Officer, Executive may hire and
terminate the employment of any other employee of the Corporation, or of any of
their divisions, subsidiaries or affiliates, who is under his jurisdiction.
(b) Executive shall devote his primary business time to the business and
affairs of the Corporation, excluding any periods of vacation, sick leave, and
disability to which Executive is entitled; and he shall fulfill his duties to
the Corporation to the best of his ability. However, it shall not be a violation
of this Agreement for the Executive to (i) serve on corporate, civic, or
charitable boards or committees, (ii) deliver lectures, fulfill speaking
engagements, or teach at educational institutions, and (iii) manage his personal
finances and passive investments, so long as none of such activities (singularly
or collectively) significantly interfere with the performance of the Executive's
responsibilities as an employee of the Corporation in accordance with this
Agreement.
(c) A description of the specific duties and responsibilities of the
Executive is contained in Exhibit A attached to this Agreement.
3. TERM. The term of this Agreement shall be for a period of three (3)
years commencing January 1, 2000 (the "Term") unless terminated earlier by
mutual agreement of the parties or by either party in accordance with Section 8
of this Agreement. Upon completion of the original three-year Term, the
Agreement shall automatically be renewed for a period of one (1) year as of each
succeeding January 1st (beginning January 1st, 2003); provided, that the
Corporation may terminate the Agreement as of any such renewal date by providing
ninety (90) days advance written notice to the Executive.
4. COMPENSATION DURING EMPLOYMENT. For all the services to be
rendered by Executive hereunder, the Corporation shall pay to Executive a
base salary, bonuses, and incentive compensation as follows:
(a) BASE SALARY. Executive shall be paid an annual base salary of Two
Hundred Forty Thousand dollars ($240,000.00), payable in equal monthly
installments. Payment of such salary may be made in shares of Corporation Common
Stock (the "Shares"), cash, or a combination thereof, as determined by the
Corporation's Chairman and Chief Executive Officer, in his sole discretion,
taking into account the Corporation's cash flow requirements and any other
aspect of the Corporation's financial condition deemed relevant by the
Corporation's Chairman and Chief Executive Officer. The value of any Shares paid
to the Executive under this provision shall be based on the per share price of
the last trade of Shares as reported on NASDAQ or the OTC bulletin board, as
applicable, for the last trading day of the applicable pay period (or if Shares
were not traded on such date, for the closest preceding date on which a trade
occurred). The Corporation's Chairman and Chief Executive Officer may increase
the Executive 's annual base salary effective as of any anniversary date of this
Agreement in such amounts as the Chairman and Chief Executive Officer deems
appropriate in his sole discretion.
(b) STOCK GRANT. Upon the execution of this Agreement, Executive
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shall receive a one time grant of Seven Million Four Hundred Thousand
(7,400,000) Shares.
(c) EXECUTIVE'S INCENTIVE COMPENSATION. Executive may be entitled to such
bonuses and incentive compensation as may be determined by the Chairman and
Chief Executive Officer in his sole discretion. Each such bonus or incentive
compensation may be paid in cash or Shares or combination thereof as the
Chairman and Chief Executive Officer shall determine in his sole discretion.
Such incentive compensation may also include options to purchase shares of the
Corporation's Common Stock pursuant to a plan established by the Corporation's
Board of Directors.
5. OTHER BENEFITS. In addition to other benefits conferred under this
Agreement, Executive shall have the right to participate in (on the same terms
and conditions as available to other senior executives of the Corporation) all
pension plans, retirement plans, deferred compensation plans, executive
compensation plans, major medical, group health, disability, accidental death
and group term life insurance plans, "fringe" benefit plans (including
permissible sick days or leave days), and other employee benefit plans that the
Corporation shall, from time to time, generally confer upon other senior
executives of the Corporation.
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6. VACATION, HOLIDAYS, ETC. Executive shall be entitled to five (5) weeks
vacation with pay (or such greater length of time as may be approved from time
to time by the Corporation's Board of Directors) during each fiscal year of the
Corporation, such vacation to be taken by Executive at such times as shall be
consistent with the business requirements of the Corporation. In addition,
Executive shall also be entitled to such holidays as are customary in the
Corporation. Unused holidays and days of vacation may not be carried over form
one fiscal year to another, and additional income will not be given for vacation
time or holidays not taken.
7. EXPENSES. Executive is expected from time to time, to incur reasonable
expenses as he reasonably deems to be for the Corporation's benefit and for
promoting the business of the Corporation, including expenses for entertainment,
travel, and similar items. Executive shall be promptly reimbursed for all such
reasonable expenses (in accordance with the policies and procedures regarding
employee business-related expense from time to time established by the
Corporation for its senior executive officers) upon his presenting to the
Corporation a detailed itemized expense voucher therefor in accordance with
applicable corporate policies. Executive may also draw funds from the
Corporation, but only to the extent necessary and appropriate, for reasonable
expenses to be incurred on behalf of the Corporation and then only in accordance
with applicable corporate policies. Detailed records of the expenditure of such
funds shall be tendered by Executive for expenses incurred on behalf of the
Corporation in accordance with applicable corporate policies, and if any portion
of such funds are unexpended or unaccountable, then Executive shall promptly
return such unexpended or unaccountable sums to the Corporation.
8. TERMINATION OF EMPLOYMENT.
(a) TERMINATION FOR CAUSE. Notwithstanding the provisions of Section 3
hereof, the Corporation shall have the right to terminate this Agreement
immediately upon giving written notice to the Executive (or Executive's personal
or legal representatives, if appropriate), for any of the following reasons:
(1) Death of the Executive;
(2) Inability of the Executive, by reason of physical or mental
disability ("Disability"), to continue to perform his duties hereunder for the
remainder of the term of this Agreement;
(3) Just Cause, which is defined herein to mean: (a) Executive's
gross negligence in performing his duties hereunder; (b) Executive's willful
failure or refusal to perform his duties hereunder; (c) Executive's intentional
wrongful act or wrongful failure to act that materially and adversely affects
the business affairs of the Corporation; or (d) Executive's commission of any
act of fraud, commission of any felony, material breach of any provision of this
Agreement, involvement in any material conflict of interest or self dealing
transaction in violation of the applicable corporate laws of the State of
Delaware, or other breach of any of his quasi-fiduciary duties to the
Corporation in violation of the applicable corporate laws of the State of
Delaware (including, but not limited to, the duties of due care, loyalty, and
fair dealing).
(b) TERMINATION BENEFITS. If this Agreement expires, or if during the Term
the Corporation terminates this Agreement and Executive's employment hereunder
as a result of any of the following, Executive will be entitled to the following
termination compensation or severance benefits:
(1) DEATH. If during the Term, Executive's employment is
terminated by reason of death, the Corporation shall thereafter have no
liability to Executive's estate hereunder, except to timely pay and provide his
estate the following: (i) the portion, if any, of Executive's Base Salary for
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the period up to the date of death that remains unpaid; (ii) any bonuses and
incentive compensation for any preceding year or for the current year that have
been earned (pro-rated to the date of death), but have not been paid as of the
date of death; and (iii) all other payments and benefits that Executive is
eligible to receive, but have not yet been received as of the date of death,
under all benefit plans, retirement plans, and other arrangements that, by their
terms, apply.
(2) DISABILITY. If during the Term, Executive's employment is
terminated due to Executive's Disability as defined in paragraph 8(a)(2) above,
the Corporation shall, after such effective date of termination, have no
liability to Executive hereunder, except to timely pay and provide the Executive
the following: (i) the portion, if any, of Executive's Base Salary for the
period up to the effective date of termination that remains unpaid; (ii) any
bonuses and incentive compensation for any preceding year or for the current
year (pro-rated to the effective date of termination) that have been earned, but
have not been paid as of the effective date of termination; and (iii) all other
payments and benefits that Executive is eligible to receive, but have not yet
been received as of the effective date of termination, under all benefit plans,
retirement plans, and other arrangements that, by their terms, apply.
(3) JUST CAUSE. If during the Term, Executive's employment is
terminated for Just Cause as specified in Section 8(a)(3) above, the Corporation
shall, after such effective date of expiration or termination, have no liability
to Executive hereunder, except to timely pay and provide the Executive the
following: (i) any bonuses and incentive compensation for any preceding year or
for the current year (pro-rated to the effective date of termination; and (ii)
all other payments and benefits that Executive is eligible to receive, but have
not yet been received as of the effective date of termination, under all benefit
plans, retirement plans, and other arrangements that, by their terms, apply. To
the extent that any insurance coverages maintained by the Corporation for the
benefit of Executive have conversion privileges into individual policies, the
Executive, upon his termination of employment or within any applicable grace
periods thereafter, may (at his sole cost) so convert such coverages, as well as
exercise (at his sole cost) all rights of continuation prescribed by applicable
law.
(4) WITHOUT CAUSE. If during the Term, Executive's employment
is terminated without the Executive's written consent and without Just Cause for
any reason whatsoever other than disability or death, the Corporation shall,
after such effective date or expiration or termination, have no liability to
Executive hereunder, except to timely pay and provide the Executive the
following: (i) the same Base Salary, bonuses and incentive compensation,
benefits, and other compensation that the Executive would otherwise be entitled
to receive hereunder through the remaining unexpired Term hereof as though no
termination or expiration had occurred; (ii) any bonuses and incentive
compensation for any preceding year or for the current year that have been
earned, but have not been paid as of the effective date of termination; (iii)
all other payment and benefits that Executive is eligible to receive, but have
not yet been received as of the effective date of termination. To the extent
that any insurance coverages maintained by the Corporation for the benefit of
Executive have conversion privileges into individual policies, the Executive,
upon his termination of employment or within any applicable grace periods
thereafter, may (at his sole cost) so convert such coverages, as well as
exercise (at his sole cost) all rights of continuation prescribed by applicable
law.
(5) TERMINATION BY EXECUTIVE. In the event that Executive
terminates this Agreement for any reason, the Corporation shall, after such
effective date of termination, have no liability to Executive hereunder, except
as specified in Section 8(b)(3) hereof, as if the Corporation had terminated the
Executive for Cause.
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9. RESTRICTIVE COVENANTS OF EXECUTIVE.
(a) DEFINITIONS. For the purposes of this Agreement:
(1) "CONFIDENTIAL INFORMATION" shall mean any information relating
to the Corporation or to the business of the Corporation (or to any of its
parents, subsidiaries or affiliates) (whether proprietary or otherwise) not
generally known to the public or known by Executive otherwise than as a
consequence of or through his employment with the Corporation and treated by the
Corporation as being confidential, including, but not limited to, research,
marketing, customer lists, databases, financing sources, methods, techniques and
systems, all of which shall be deemed by the Corporation and Executive as being
Confidential Information.
(2) "PERSON" shall mean an individual, a partnership, an
association, a corporation, a trust, an unincorporated organization, or any
other business entity or enterprise, provided, however, that the term "Person"
shall not include the Corporation.
(b) ACKNOWLEDGEMENTS. Executive agrees and acknowledges that: (i) he will
be in a position of confidence and trust with the Corporation and he will have
access to Confidential Information; (ii) the nature and periods of restrictions
imposed by the covenants set forth in this Section are fair, reasonable and
necessary to protect and preserve for the Corporation the benefits of this
Agreement and that such restrictions will not prevent Executive from earning a
livelihood; (iii) the Corporation would sustain irreparable loss and damage if
Executive were to breach any of such covenants; and (iv) the covenants herein
set forth are made as an inducement to and have been relied upon by the
Corporation in entering this Agreement.
(c) CONFIDENTIAL INFORMATION. Executive hereby covenants and agrees that
Executive shall not, directly or indirectly, during the Term of this Agreement
and for three (3) years after Executive's employment is terminated for whatever
reason, disclose to any Person or use or otherwise exploit for Executive's own
benefit or for the benefit of any other Person any Confidential Information that
was disclosed to Executive or acquired by Executive while an employee of the
Corporation. Upon the termination or expiration of this Agreement, Executive
shall return to the Corporation all material in Executive's possession or
control which is of a confidential matter relating to the Corporation's
business. These provision shall survive the termination or expiration of this
Agreement.
(d) NON-COMPETITION.
(1) Executive hereby agrees that during the Term and for one (1)
year following the termination of the Executive's employment by the Corporation,
however occurring, he will not, directly or indirectly, expressly or tacitly,
for himself or on behalf of any Person, (i) act as a director, officer, manager,
shareholder, partner, member, advisor, executive or consultant to any business
that provides services or products which are directly competitive with the
services or products being provided by or which are being produced or developed
by the Corporation, or are under investigation by the Corporation at the
expiration of the Term and with which Executive had contact as an employee of
the Corporation, or (ii) recruit investors on behalf of an entity which engages
in activities that are directly competitive with the services or products being
provided or that are being produced or developed by the Corporation, or are
under investigation by the Corporation at the expiration of the Term and with
which Executive had contact as an employee of the Corporation.
(2) Executive hereby agrees that during the Term and for one (1)
year following the termination of the Executive's employment by the Corporation,
however occurring, he will not, directly or indirectly, expressly or tacitly,
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for himself or on behalf of any Person, solicit, suggest or direct others to
solicit for hire any person employed by the Corporation at the time of
termination of the Executive's employment by the Corporation.
(3) Executive hereby agrees that during the Term and for one (1)
year following the termination of the Executive's employment by the Corporation,
however occurring, he will not, directly or indirectly, expressly or tacitly,
for himself or on behalf of any Person, solicit, divert or attempt to
appropriate, to any Person which competes with the Corporation, any Person who
is or was a customer of the Corporation or an actively sought prospective
customer of the Corporation with which he had contact as an employee of the
Corporation during the Term.
(e) CONSENT TO COURT-ORDERED REMEDY. Executive acknowledges that his
breach of any covenant set forth in this Section 9 will result in irreparable
injury to the Corporation and that the Corporation's remedies at law for such a
breach are inadequate and extremely difficult to calculate or determine.
Accordingly, Executive agrees and consents that upon such a breach or threatened
breach by Executive of any covenant set forth herein, the Corporation shall be
entitled to such remedies in law or equity as may be determined by the court for
such a breach or threatened breach.
(f) REMEDIES CUMULATIVE AND CONCURRENT. The rights and remedies of the
Corporation, as provided in this Section 9 shall be cumulative and concurrent
and may be pursued separately, successively or together against Executive at the
sole discretion of the Corporation, and may be exercised as often as occasion
therefor shall arise. The failure to exercise any right or remedy shall in no
event be construed as a waiver or release thereof.
10. INDEMNITY. To the fullest extent permitted by law, the Corporation
shall indemnify Executive and hold him harmless for any acts or decisions made
by him in good faith while performing services for the Corporation. In addition,
to the fullest extent permitted by law, the Corporation shall pay all expenses,
including attorneys' fees, actually and necessarily incurred by Executive in
connection with the defense of any action, suit or proceeding challenging such
acts of decisions and in connection with any appeal thereon including the costs
of settlement. This indemnification obligation shall survive the termination of
the Executive's employment hereunder.
11. WAIVER OF BREACH OF VIOLATION NOT DEEMED CONTINUING. The waiver
by either party of a breach or violation of any provision of this Agreement
shall not operate as or be construed to be a waiver of any subsequent breach
hereof.
12. NOTICES. Any and all notices required or permitted to be given
under this Agreement will be sufficient if furnished in writing, personally
delivered or sent by certified mail, return receipt requested as follows:
To Executive:
X. Xxxx Still
000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
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To the Corporation:
Phoenix Healthcare Corporation
Attn: Chairman and Chief Executive Officer
0000 Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
13. SECURITIES LAW COMPLIANCE. The Executive represents and agrees that he
is acquiring any Shares he receives under this Agreement for his own account and
not with the intention reselling or distributing the Shares, except as permitted
under this Agreement and any applicable federal and state securities laws. The
Corporation shall have the right to take any actions it may deem necessary or
appropriate to ensure that the Shares granted to the Executive complies with
applicable federal and state securities laws.
14. TAX LIABILITY. The Corporation may withhold from any payment made
pursuant to this Agreement any federal, state or local taxes required to be
withheld from such payment. The Executive shall make such arrangements as may be
required or be satisfactory to the Corporation (in its sole discretion) for the
payment of any tax withholding obligations that arise in connection with the
granting of Shares under this Agreement. The Corporation shall not be required
to issue any Shares under this Agreement until such obligations are satisfied.
15. GOVERNING LAW. This Agreement shall be interpreted, construed and
governed according to the laws of the State of Texas. The parties hereto consent
to jurisdiction and venue in the Texas state courts in Dallas, Texas and United
States District Court for the Northern District of Texas, Dallas Division.
16. PARAGRAPH HEADINGS. The paragraph headings contained in this
Agreement are for convenience only and shall in no manner be construed as a
part of this Agreement.
17. ENTIRE AGREEMENT. This Agreement supersedes all prior discussions and
agreements between the Corporation, or any of its officers, directors,
employees, or agents, and Executive with respect to all xxxxxx relating to the
employment by the Corporation of Executive and all other matters contained
herein, and this Agreement constitutes the sole and entire agreement with
respect thereto. Any representation, inducement, promise or agreement, whether
oral or written, between the Corporation, or any of its officers, directors,
employees, or agents, and Executive which is not embodied herein shall be of no
force or effect.
18. SUCCESSORS AND ASSIGNORS. This Agreement shall be binding upon,
and shall inure to the benefit of, the Corporation and Executive and their
respective heirs, personal and legal representatives, successors, and assigns.
19. SEVERABILITY. If any term, covenant or condition of this Agreement or
the application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable the remainder of this Agreement or the application of
such terms, covenants and conditions to persons or circumstances other than
those as to which it is held invalid or unenforceable shall be affected thereby
and each term, covenant or condition of this Agreement shall be valid and be
enforced to the fullest extent permitted by law.
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IN WITNESS WHEREOF, the Corporation has hereunder to caused this Agreement
to be executed by its duly authorized offices and seals to be hereunto affixed,
and Executive has hereunto set his hand and seal, all being done in duplicate
originals delivered to each party as of the day and year first above written.
/S/ X. XXXX STILL
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Witness X. Xxxx Still
ATTEST: Phoenix Healthcare Corporation
By: /S/ XXXXXX X. XXXX
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Xxxxxx X. Xxxx
Chairman of the Board, President
and Chief Executive Officer
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EXHIBIT A
DESCRIPTION OF SPECIFIC DUTIES AND RESPONSIBILITIES
Executive shall serve the Corporation as its Executive Vice President and
Healthcare Information Technologies, Inc. ("HIT"), a wholly-owned subsidiary of
the Corporation, as its President. At all times, Executive shall report to,
discharge his duties in consultation with and be under the direct supervision
and control of the Corporation's Chairman and Chief Executive Officer. Executive
shall perform such duties, consistent with the Executive's employment as a
senior corporate executive, shall hold such other titles with respect to the
Corporation, or any of its divisions, subsidiaries or affiliates, as the
Corporation's Board of Directors may from time to time determine, and shall
comply with all applicable provisions of the Corporation's certificate of
incorporation and bylaws.
As the President of HIT, the Executive shall, subject to the direction of
the Corporation's Chairman and Chief Executive Officer, have the authority to
formulate policies for and administer all operational aspects of HIT's business.
As to employees under Executive's jurisdiction, including those working
directly under his supervision, Executive shall use his best efforts to (i)
employ and retain only employees who are capable and willing to perform
according to applicable legal requirements and applicable policies of the
Corporation, and (ii) assure that such personnel are properly trained and
supervised. Subject to the direction of the Corporation's Chairman and Chief
Executive Officer, Executive may hire and terminate the employment of any other
employee of the Corporation, or any of its divisions, subsidiaries or
affiliates, who is under his jurisdiction.
