EMPLOYMENT AGREEMENT
EXHIBIT
10.103
THIS EMPLOYMENT AGREEMENT is
dated as of March 23, 2009, between Imaging Diagnostic Systems,
Inc., a Florida corporation (the "Company"), and Xxxxx X. Xxxxxxxx (the
"Executive").
WITNESSETH:
WHEREAS, The Company is
engaged in the business of developing laser-based medical optical imaging
devices; and
WHEREAS, the Company has the
intent to market and sell its products and services to clients and potential
clients throughout the world; and
WHEREAS, the Company wishes to
employ the Executive as its Executive Vice President and Chief Financial
Officer, to oversee various broad and specific aspects of its business;
and
WHEREAS, in the course of the
Executive’s employment, the Executive will have access to and acquire knowledge
of valuable trade secrets, confidential information and other proprietary
information belonging and relating to the Company and its business, and which
the Company has a legitimate interest in protecting; and
WHEREAS, the Company and
Executive are willing to commit to such employment, subject to the terms and
conditions contained in this Employment Agreement (the
“Agreement”);
NOW, THEREFORE, in
consideration of the premises and the mutual covenants set forth in this
Agreement, and intending to be legally bound, the Company and the Executive
agree as follows:
1. EMPLOYMENT. The Company
hereby employs the Executive and the Executive hereby accepts employment upon
the terms and conditions hereinafter set forth.
2. TERM &
TERMINATION.
(a) Term. The Company hereby
employs the Executive, and the Executive, hereby accepts employment with the
Company, for a period commencing on March 23, 2009, and ending one year from
that date (the "Term"). All Company obligations under this Agreement shall cease
upon its termination, except for those stock options which have been
vested.
(b) Termination without
Cause. The Company may
terminate the Executive’s employment without cause. Such termination
will become effective upon the date specified in the termination notice,
provided that such date is at least 60 days from the date of such
notice. In the event of such termination without
cause:
(i) For
the remainder of the Term following the effective date of termination, the
Company will continue to pay the Executive his salary pursuant to Section
3(a).
(ii) The
Company will continue to maintain for the remainder of the Term following the
effective date of termination, for the benefit of the Executive, the employee
benefit programs referred to in Section 3(b) as in effect on the date of
termination.
(iii) On
the effective date of termination, all options that were scheduled to vest will
vest and will remain exercisable for a period of three years from the date of
termination.
(c) Termination for
Cause. The Company may terminate the Executive’s employment at
any time for cause by giving written notice of termination setting forth such
cause. Such termination shall become effective upon the giving of
such notice, except that, where the basis for cause is capable of cure within 30
days, termination based upon cause shall not become effective unless Executive
shall fail to complete such cure within 30 days of receipt of written notice of
the existence of such cause. Upon such termination the Executive shall have no
right to compensation, commission, bonus, benefits or reimbursement pursuant to
this Agreement, for any period subsequent to the effective date of
termination. Further, upon termination for cause, all of the
Executive’s unvested stock options shall terminate. For purposes of this
section, “cause” shall mean; (1) the Executive is convicted of a felony; (2) the
Executive, in carrying out her duties hereunder, commits gross negligence or
willful misconduct resulting, in either case, in material harm to the Company;
(3) the Executive misappropriates Company funds or otherwise defrauds the
Company; (4) the Executive materially breaches any provision of this Agreement;
or (5) the Executive materially fails to perform her duties under section
4.
(d) Death or
Disability. Upon the death or disability of the Executive, the
Executive shall be entitled to and the Company will pay the Executive’s salary
from the date of death or from the date of disability through the end of the
Term. (For purposes of this Section, “disability” shall mean that for a period
of six months in any 12-month period the Executive is incapable of substantially
fulfilling her duties because of physical, mental or emotional incapacity
arising from injury, sickness or disease.) Should the Executive be
rendered disabled, the Company will continue to maintain for the benefit of the
Executive the employee benefit programs referred to in Section 3(b) that were in
effect on the date of the disability.
(e) Special
Termination. In the event that (i) the Company materially
breaches this Agreement or the performance of its duties and obligations
hereunder; or (ii) any entity or person not now an executive officer of the
Company becomes either individually or as part of a group the beneficial owner
of 20% or more of the Company’s common stock, the Executive, by written notice
to the Company, may elect to deem the Executive’s employment hereunder to have
been terminated by the Company without cause under Section 2(b) hereof, in which
event the Executive shall be entitled to the compensation provided for in
Section 2(b).
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(f) Voluntary
Termination. The Executive, on 30 days prior written notice to the
Company, may terminate her employment voluntarily. Upon such
termination, the Company will pay the Executive’s compensation through the date
of such termination. After such date, the Executive shall no longer
be entitled to receive any compensation, reimbursement or benefits and all
unvested stock options shall terminate upon termination of the Executive’s
employment.
(g) Continuing
Effect. Notwithstanding any
termination of this Agreement at the end of the Term or otherwise, the
provisions of Sections 6 - 11 shall remain in full force and effect and the
provisions of these Sections shall be binding upon the legal representatives,
heirs, successors and assigns of the Executive.
3. COMPENSATION.
(a) The
Company will pay the Executive an annual base salary of $192,000 per annum in
equal semi-monthly installments.
(b) During
the term of her employment, the Executive shall be entitled to participate in
employee benefits plans or programs of the Company, if any, to the extent the
Executive is eligible to participate thereunder, including the Comprehensive
Group Insurance Program maintained by the Company, partially paid by the Company
for the Executive.
(c) The
Company shall provide the Executive with a $500 per month car allowance and a
cellular phone.
(d) The
Executive shall receive an option to purchase up to an aggregate of 3,000,000
shares of the Company’s common stock at an exercise price of $.01 per share
pursuant to the Company’s standard form of stock option
agreement. The option shall vest upon the effective date of this
Agreement.
(e) The
Executive will be entitled to nine paid holidays and six weeks of vacation for
each 12-month period without loss of compensation or other benefits to which she
is entitled under this Agreement, to be taken at such times as the Executive may
select and the affairs of the Company may permit.
4. DUTIES.
(a) General
Duties. The Executive shall be employed as Senior Vice
President, with duties and responsibilities that are customary for such
position, and as directed by the Company’s by-laws. The Executive
will use the standard of care befitting of such an executive in performing
duties and in discharging responsibilities pursuant to this Agreement, which
duties and responsibilities shall be discharged competently, carefully, and
faithfully.
(b) Corporate Code of
Conduct. The Executive agrees to adhere to the Company’s
Corporate Code of Conduct.
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(c) Extent of
Services. The Executive will devote all of her time, attention
and energies during normal business hours (exclusive of periods of sickness and
disability and of such normal holiday and vacation periods as have been
established by the Company) to the affairs of the Company. The
Executive will not enter the employ of, or serve as a consultant to, or in any
way perform any services with or without compensation to any person, business or
organization without the prior consent of the Board of Directors of the Company;
provided, that the Executive shall be permitted to devote a limited amount of
time, without compensation, to charitable or similar organizations.
5. PLACE OF
PERFORMANCE. The Executive
hereby acknowledges that the Company’s existing and potential clients are
located throughout the world and that the Company is actively engaged in
marketing and selling its products and services to such clients throughout the
world.
6. NON-DISCLOSURE
OF CONFIDENTIAL INFORMATION. The Executive
acknowledges that, during her employment, she will learn and will have access to
confidential information regarding the Company and its affiliates, including
without limitation (i) proprietary or secret plans, designs, processes,
programs, documents, software, agreements or material relating to the business,
products, services or activities of the Company and its affiliates and (ii)
market reports, customer investigations, clinical data, scientific or
engineering research, customer lists and/or similar information that is
proprietary information of the Company or its affiliates (collectively,
“Confidential Business and Technical Information”). The Executive
recognizes and acknowledges that the Confidential Business and Technical
Information, as it may exist from time to time, represents valuable, special and
unique assets of the Company, access to and knowledge of which are essential to
the performance of the Executive’s duties hereunder.
The
Executive will not, during or after the term of her employment by the Company,
in whole or in part, disclose any such Confidential Business and Technical
Information to any person, firm, corporation, association or entity for any
reason or purpose whatsoever, nor shall the Executive make use of any such
Confidential Business and Technical Information for her own purposes or for the
benefit of any person, firm, corporation or entity except the Company under any
circumstances during or after the term of her employment, provided that after
the term of her employment these restrictions shall not apply to such secrets,
information and processes which are then in the public domain provided that the
Executive was not responsible, directly or indirectly, for such secrets,
information or processes entering the public domain without the Company’s
consent.
In the
event an action is instituted and prior knowledge is an issue, it shall be the
obligation of the Executive to prove by clear and convincing evidence that the
Confidential Business and Technical Information disclosed was in the public
domain, was already known by the recipient, or was developed independently by
the recipient. The Executive agrees to hold as the Company’s property
all memoranda, books, papers, letters, formulas and other data, and all copies
thereof and therefrom, in any way containing Confidential Business and Technical
Information or otherwise relating to the Company’s business and affairs, whether
made by her or
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otherwise
coming into her possession, and upon termination of her employment, or on demand
of the Company, at any time, to deliver the same to the Company.
7. NON-COMPETITION
AGREEMENT.
(a) The
Executive acknowledges and agrees that, pursuant to Florida Statutes Section
542.335, based on having access to and acquiring knowledge of highly sensitive
and valuable trade secrets, and confidential or proprietary information
belonging or relating to the Company, the Executive would be in a position to
cause serious and irreparable harm to the Company in the event that, following
the termination of her employment hereunder, the Executive were to compete with
or be involved in an enterprise which competes with the Company, engages in the
same business as the Company, or performs research and development in the field
of medical optical imaging.
(b) Until
termination of her employment and for a period of 24 months commencing on the
date of termination, the Executive, directly or indirectly, in association with
or as a stockholder, director, officer, consultant, executive, partner, joint
venturer, member or otherwise of or through any person, firm, corporation,
partnership, association or entity, covenants that the Executive will not
compete with the Company or any of its affiliates in the design, manufacture,
construction, offer, sale or marketing of products or services that are
competitive with the products or services offered by the Company during such
period, within the United States or anywhere in the world. The
Executive covenants and agrees that during her employment and for a period of 24
months immediately following the termination of such employment, the Executive
will not, either individually or in partnership or jointly or in conjunction
with any person, firm, business, corporation, partnership, joint venture,
entity, syndicate or association, as an executive, principal, agent, officer,
director, consultant, advisor, distributor, dealer, contractor, trustee, lender,
shareholder or in any manner or capacity whatsoever, directly or indirectly, be
employed by, render services to, carry on or be engaged in, or be concerned with
or be interested in or advise, lend money to, guarantee the debts or obligations
of, or in any manner participate in the management, operation or control of any
business which is directly competitive with the business of the Company, engages
in the same business as the Company or performs research and development in the
medical optical imaging field with any entity located anywhere in the
world.
(c) For
the purposes of this paragraph a business shall be deemed to be in “direct
competition” or “directly competitive” with the Company if such business is
engaged in developing, manufacturing, marketing, selling, or distributing
medical optical imaging devices.
8. NON-SOLICITATION. The Executive
covenants and agrees that while she is employed by the Company and for a period
of 24 months immediately following the termination of such employment, she will
not, directly or indirectly, in any manner whatsoever, on her own behalf, or on
behalf of any person, firm, business, corporation, partnership, joint venture,
entity, syndicate or association solicit, induce or cause, or attempt to induce
or cause, any person who is then an employee of or consultant to the Company to
cease providing services to the Company.
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9. REASONABLENESS OF
CONFIDENTIALITY, NON-COMPETITION AND NON-SOLICITATION OBLIGATION AND
COVENANTS.
(a) The
Executive hereby acknowledges and confirms that the obligations and covenants
set out in the above paragraphs are reasonable and necessary to protect the
legitimate interests of the Company. Without limiting the generality
of the foregoing, the Executive hereby acknowledges and confirms that given,
among other things, the nature and international scope of the Company’s
operations and of the employment duties to be performed by the Executive
hereunder, the geographic scope and duration of the restrictions set forth above
are reasonable and necessary to protect the legitimate interests of the
Company.
(b) The
Executive further acknowledges and agrees that these obligations and covenants
will not preclude her from becoming gainfully employed following their
termination of her employment in her profession.
10. INVENTIONS.
(a) The
Executive hereby sells, transfers and assigns to the Company or to any person or
entity designated by the Company, all of the entire right, title and interest of
the Executive in and to all inventions, ideas, disclosures and improvements,
whether patented or unpatented, and copyrightable material, made or conceived by
the Executive, solely or jointly, in whole or in part, during the term hereof
which (i) relate to methods, apparatus, designs, products, processes or devices
sold, leased, used or under construction or development by the Company or any
subsidiary, or (ii) otherwise relate to or pertain to the business, functions or
operations of the Company or any subsidiary, or (iii) arise wholly or partly
from the efforts of the Executive during the term hereof. The
Executive shall communicate promptly and disclose to the Company, in such form
as the Company requests, all information, details and data pertaining to the
aforementioned inventions, ideas, disclosures and improvements; and, whether
during the term hereof or thereafter, the Executive shall execute and deliver to
the Company such formal transfers and assignments and such other papers and
documents as may be required of the Executive at the Company’s expense to permit
the Company or any person or entity designated by the Company to file and
prosecute the patent applications and, as to copyrightable material, to obtain
copyright thereon. Any invention made by the Executive within one
year following the termination of employment shall be deemed to fall within the
provisions of this Section unless proven by the Executive to have been first
conceived and made following such termination.
(b) No
Payment. The Executive
acknowledges and agrees that no separate or additional payment or compensation
will be required to be made to her in consideration of her undertakings in this
Section.
11. EQUITABLE
RELIEF.
(a) The
Company and the Executive recognize that the services to be rendered under this
Agreement by the Executive are special, unique and of extraordinary character,
and
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that in
the event of the breach by the Executive of the terms and conditions of this
Agreement or if the Executive, without the prior consent of the Board of
Directors of the Company, shall leave her employment for any reason and take any
action in violation of Section 6, Section 7 or Section 8, the Company will be
entitled to institute and prosecute proceedings in any court of competent
jurisdiction referred to in Section 11(b) below, to enjoin the Executive from
breaching the provisions of Section 6, Section 7, or Section 8. In
such action, the Company will not be required to plead or prove irreparable harm
or lack of an adequate remedy at law. Nothing contained in this
Section 11 shall be construed to prevent the Company from seeking such other
remedy as the Company may elect in any arbitration proceeding based on any
breach of this Agreement by the Executive.
(b) Any
proceeding or action for equitable relief must be commenced in state court in
Broward County, Florida. The Executive and the Company irrevocably
and unconditionally submit to the jurisdiction of such court and agree to take
any and all future action necessary to submit to the jurisdiction of such
court. The Executive and the Company irrevocably waive any objection
that they now have or hereafter may have to the laying of venue of any suit,
action or proceeding brought in such court for equitable relief and further
irrevocably waive any claim that any such suit, action or proceeding brought in
such court has been brought in an inconvenient forum.
12. ASSIGNMENT. The
rights and obligations of the Company under this Agreement shall inure to the
benefit of and be binding upon the successors and assigns of the Company,
provided that any such successor or assign shall acquire all or substantially
all of the assets and business of the Company. The Executive's
obligations hereunder may not be assigned or alienated and any attempt to do so
by the Executive will be void.
13. SEVERABILITY.
(a) The
Executive expressly agrees that the character, duration and geographical scope
of the provisions set forth in this Agreement are reasonable in light of the
circumstances, as they exist on the date hereof. Should a decision,
however, be made at a later date by a court of competent jurisdiction that the
character, duration or geographical scope of such provisions is unreasonable,
then it is the intention and the agreement of the Executive and the Company that
this Agreement shall be construed by the court in such a manner as to impose
only those restrictions on the Executive's conduct that are reasonable in the
light of the circumstances and as are necessary to assure to the Company the
benefits of this Agreement. If, in any judicial proceeding, a court
shall refuse to enforce all of the separate covenants deemed included herein
because taken together they are more extensive than necessary to assure to the
Company the intended benefits of this Agreement, it is expressly understood and
agreed by the parties hereto that the provisions of this Agreement that, if
eliminated, would permit the remaining separate provisions to be enforced in
such proceeding shall be deemed eliminated, for the purposes of such proceeding,
from this Agreement.
(b) If
any provision of this Agreement otherwise is deemed to be invalid or
unenforceable or is prohibited by the laws of the state or jurisdiction where it
is to be performed, this Agreement shall be considered divisible as to such
provision and such provision shall be
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inoperative
in such state or jurisdiction and shall not be part of the consideration moving
from either of the parties to the other. The remaining provisions of this
Agreement shall be valid and binding and of like effect as though such provision
were not included.
14. NOTICES
AND ADDRESSES. All
notices, offers, acceptance and any other acts under this Agreement (except
payment) shall be in writing, and shall be sufficiently given if delivered to
the addressee in person, by Federal Express or similar receipted delivery, by
facsimile delivery or, if mailed, postage prepaid, by certified mail, return
receipt requested, as follows:
To the
Company: Imaging
Diagnostic Systems, Inc.
0000 X.X.
00xx
Xxxxxxx
Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
To the
Executive: Xxxxx
X. Xxxxxxxx
0000 X.X.
00xx
Xxxxxxx
Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
or to
such other address as either of them, by notice to the other may designate from
time to time. The transmission confirmation receipt from the sender's facsimile
machine shall be conclusive evidence of successful facsimile
delivery. Time shall be counted to, or from, as the case may be, the
delivery in person or by mailing.
15. COUNTERPART. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument. The execution of this Agreement may be by actual or
facsimile signature.
16. ARBITRATION. Except
for any controversy or claim seeking equitable relief as provided in Section 11
of this Agreement, any controversy or claim arising out of or relating to this
Agreement, or to the interpretation, breach or enforcement thereof or any other
dispute between the parties, shall be submitted to one arbitrator and settled by
arbitration in Fort Lauderdale, Florida, in accordance with the commercial
arbitration rules of the American Arbitration Association in effect at such
time. Any award made by such arbitrator shall be final, binding and
conclusive on all parties hereto for all purposes, and judgment may be entered
thereon in any court having jurisdiction thereof.
17. ATTORNEYS
FEES. In the event that
there is any controversy or claim arising out of or relating to this Agreement,
or to the interpretation, breach or enforcement thereof, and any action or
proceeding is commenced to enforce the provisions of this Agreement, whether
through litigation or arbitration, the prevailing party shall be entitled to
recover from the non-prevailing party her/its reasonable attorney’s fees, costs
and expenses incurred at all levels.
18. GOVERNING
LAW. This
Agreement and any dispute, disagreement, or issues of construction or
interpretation arising hereunder whether relating to its execution, its
validity,
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the
obligations provided therein or performance shall be governed or interpreted
according to the internal laws of the State of Florida without regard to choice
of law considerations.
19. ENTIRE
AGREEMENT. This Agreement
constitutes the entire Agreement between the parties and supersedes all prior
oral and written agreements between the parties with respect to the subject
matter hereof. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, except by a statement in
writing signed by the party or parties against whom enforcement or the change,
waiver, discharge or termination is sought.
20. ADDITIONAL
DOCUMENTS. The parties
hereto shall execute and deliver such additional instruments as may be
reasonably required in order to carry out the purpose and intent of this
Agreement and to fulfill the obligations of the parties hereunder.
21. SECTION
AND PARAGRAPH HEADINGS. The section and
paragraph headings in this Agreement are for reference purposes only and shall
not affect the meaning or interpretation of this Agreement.
22. WAIVER OF
BREACH. A waiver by the
Company or the Executive of a breach of any provision of the Agreement by the
other party shall not operate or be construed as a waiver of any subsequent
breach by the other party.
IN WITNESS WHEREOF, the
Company and the Executive have executed this Agreement as of the 23rd day of
March, 2009.
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IMAGING
DIAGNOSTIC SYSTEMS, INC.
By: /s/
Xxxxx X. Xxxxxx
Xxxxx
X. Xxxxxx, Chief Executive Officer
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EXECUTIVE
By: /s/ Xxxxx X.
Xxxxxxxx
Xxxxx
X. Xxxxxxxx
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STOCK OPTION
AGREEMENT
(2007
Non-Statutory Stock Option Plan)
Imaging Diagnostic Systems,
Inc. (the “Company”), desiring to afford an opportunity to the Grantee
named below to purchase certain shares of common stock of the Company, to
provide the Grantee with an added incentive as an employee, director or
consultant of the Company, hereby grants to Grantee, and the Grantee hereby
accepts, an option to purchase the number of such shares optioned as specified
below, during the term ending at midnight (prevailing local time at the
Company’s principal office) on the expiration date of this Option specified
below, at the option exercise price specified below, subject to and upon the
following terms and conditions:
1. Identifying
Provisions: As used in this
Option, the following terms shall have the following respective
meanings.
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(a)
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Grantee:
XXXXX X.
XXXXXXXX
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(b)
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Date
of Grant: March 23, 2009
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(c)
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Number
of shares
optioned: 3,000,000
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(d)
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Option
exercise price per
share: $.01
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(e)
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Expiration
Date: Xxxxx 00, 0000
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(x)
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Plan: The
Company’s 2007 Non-Statutory Stock Option Plan;
and
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(g)
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Committee: The stock
option committee of the Company’s Board of Directors, or if none, the
Board of Directors.
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This
Option is not intended to be an incentive stock option pursuant to Section 422
of the Internal Revenue Code.
2. Vesting: This
Option shall vest and become exercisable on March 24, 2009.
3. Restrictions
on Exercise: The following
additional provisions shall apply to the exercise of this Option:
(a) Termination of
Employment. If the Grantee’s employment by the Company or any of its
subsidiaries is terminated without cause for any reason, other than death only
that portion of this Option exercisable at the time of such termination of
employment may thereafter be exercised, and it may not be exercised more than
three years after such termination nor after the Expiration Date of this Option,
whichever date is sooner. In all other respects, this Option shall terminate
upon such termination of employment.
(b) Death of Grantee. If the Grantee shall die
during the term of this Option, the Grantee’s legal representative or
representatives, or the person or persons entitled to do so under the Grantee’s
last will and testament or under applicable intestate laws, shall have the right
to exercise this Option, but only for the number of shares as to which the
Grantee was entitled to exercise this Option in accordance with Section 2 hereof
on the date of her death, and such right shall expire and this Option shall
terminate 15 months after the date of the Grantee’s death or on
the
Expiration Date of this Option, whichever date is sooner. In all other respects,
this Option shall terminate upon such death.
(c) Continuity of
Employment. This Option shall not be exercisable by the Grantee in
any part unless at all times beginning with the date of grant and ending no more
than three months prior to the date of exercise, the Grantee has, except for
military service leave, sick leave or other bona fide leave of absence (such as
temporary employment by the United States Government) been in the continuous
service of the Company, except that such period of three months shall be one (1)
year following any termination of the Grantee’s employment by reason of her
permanent and total disability.
(d)
Should (i) the Grantee’s Service be terminated for misconduct (including, but
not limited to, any act of dishonesty, willful misconduct, fraud or
embezzlement) or (ii) the Grantee make any unauthorized use or disclosure of
confidential information or trade secrets of the Company or its Parent or
Subsidiary, then in any such event all outstanding Options held by the Grantee
under this Plan shall terminate immediately and cease to be
exercisable.
4. Non-Transferable. The Grantee may
not transfer this Option except by will or the laws of descent and distribution.
This Option shall not be otherwise transferred, assigned, pledged, hypothecated
or disposed of in any way, whether by operation of law or otherwise, and shall
be exercisable during the Grantee’s lifetime only by the Grantee or her guardian
or legal representative.
5. Adjustments
and Corporate Reorganization. Subject to any required action
by the shareholders of the Company, the number of Shares covered by each
outstanding Option, and the number of Shares which have been authorized for
issuance under the Plan but as to which no Options have yet been granted or
which have been returned to the Plan upon cancellation or expiration of any
Option, as well as the price per Share covered by each such outstanding Option,
shall be proportionately adjusted for any increase or decrease in the number of
issued Shares resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt
of consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been “effected
without receipt of consideration.” Such adjustment shall be made by the
Committee, whose determination in that respect shall be final, binding and
conclusive. Except as expressly provided herein, no issuance by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of Shares subject to an
Option.
In the
event of the proposed dissolution or liquidation of the Company, the Option will
terminate immediately prior to the consummation of such proposed action, unless
otherwise provided by the Committee. The Committee may, in the
exercise of its sole discretion in such instances, declare that any Option shall
terminate as of a date fixed by the Committee and give each Grantee the right to
exercise her Option as to all or any part of the Option, including Shares as to
which the Option would not otherwise be exercisable. In the event of
the proposed sale of all or substantially all of the assets of the Company, or
the merger of the Company with or into another corporation in a transaction in
which the Company is not the survivor, the Option shall be assumed or an
equivalent option shall be substituted by such successor corporation or a parent
or subsidiary of such successor corporation, unless the Committee determines, in
the exercise of its sole discretion and in lieu of such assumption or
substitution, that the Grantee shall have the right to exercise the Option as to
all of the optioned stock, including shares as to which the
Option
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would not
otherwise be exercisable. If the Committee makes an Option fully
exercisable in lieu of assumption or substitution in the event of such a merger
or sale of assets, the Committee shall notify the Grantee that the Option shall
be fully exercisable for a period of 30 days from the date of such notice, and
the Option will terminate upon the expiration of such period.
6. Exercise,
Payment For and Delivery of Stock: This Option may be
exercised by the Grantee or other person then entitled to exercise it by giving
four business days’ written notice of exercise to the Company specifying the
number of shares to be purchased and the total purchase price. The exercise
price shall become immediately due upon exercise of the Option and, subject to
the instrument evidencing the grant, shall be payable in one of the following
alternative forms specified below:
(a) full
payment in cash or check drawn to the Company’s order;
(b) full
payment in shares of Common Stock held for at least six (6) months and valued at
fair market value on the Exercise Date (as such term is defined
below);
(c) full
payment through a combination of shares of Common Stock held for at least six
(6) months and valued at fair market value on the Exercise Date and cash or
check; or
(d) full
payment through a broker-dealer sale and remittance procedure provided that sale
of the optioned stock is permitted as a result of an effective registration
statement under the Securities Act of 1933, as amended, and compliance with all
applicable securities laws, pursuant to which the Grantee (i) shall provide
irrevocable written instructions to a Company-designated brokerage firm to
effect the immediate sale of the purchased shares and remit to the Company, out
of the sale proceeds available on the settlement date, sufficient funds to cover
the aggregate option price payable for the purchased shares plus all applicable
Federal and State income taxes required to be withheld by the Company in
connection with such purchase and (ii) shall provide written directives to the
Company to deliver the certificates for the purchased shares directly to such
brokerage firm in order to complete the sale transaction.
For
purposes of this section 6, the Exercise Date shall be the date on which written
notice of the option exercise is delivered to the Company. Except to
the extent the sale and remittance procedure is utilized in connection with the
exercise of the Option, payment of the exercise price for the purchased shares
must accompany such notice.
The fair
market value per share of Common Stock on any relevant date shall be determined
in accordance with the following provisions:
(i) If
the Common Stock is not at the time listed or admitted to trading on any
national stock exchange but is traded on the NASDAQ National Market, the fair
market value shall be the closing selling price per share of Common Stock on the
date in question, as such price is reported by the National Association of
Securities Dealers on the NASDAQ National Market or any successor
system. If there is no reported closing selling price for the Common
Stock on the date in question, then the closing selling price on the last
preceding date for which such quotation exists shall be determinative of fair
market value.
(ii) If
the Common Stock is at the time listed or admitted to trading on any national
stock exchange, then the fair market value shall be the closing selling price
per share of Common Stock on the date in question on the stock exchange
determined by the Committee to be the primary market for the Common Stock, as
such price is officially quoted in the composite tape of
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transactions
on such exchange. If there is no reported sale of Common Stock on
such exchange on the date in question, then the fair market value shall be the
closing selling price on the exchange on the last preceding date for which such
quotation exists.
(iii) If
the Common Stock is quoted on the NASDAQ Capital Market, or any similar system
of automated dissemination of quotations of securities process in common use,
the fair market value shall be the mean between the closing bid and asked
quotations for the Common Stock on such date.
(iv) If
neither clause (i), (ii) or (iii) is applicable, then the fair market value
shall be the mean between the closing bid and asked quotations for the Common
Stock as reported by the National Quotation Bureau, Inc., if at least two
securities dealers have inserted both bid and asked quotations for Common Stock
on at least five of the ten preceding business days.
7. Rights in
Shares Before Issuance and Delivery. No person shall be
entitled to the privileges of stock ownership in respect of any shares issuable
upon exercise of this Option, unless and until such shares have been issued to
such person as fully paid shares.
8. Requirements
of Law and of Stock Exchanges. By accepting this
Option, the Grantee represents and agrees for himself and her transferees by
will or the laws of descent and distribution that, unless a registration
statement under the Securities Act of 1933 is in effect as to shares purchased
upon any exercise of this Option, (i) any and all shares so purchased shall be
acquired for her personal account and not with a view to or for sale in
connection with any distribution, and (ii) each notice of the exercise of any
portion of this Option shall be accompanied by a representation and warranty in
writing, signed by the person entitled to exercise the same, that the shares are
being so acquired in good faith for her personal account and not with view to or
for sale in connection with any distribution.
No certificate or certificates for
shares of stock purchased upon exercise of this Option shall be issued and
delivered unless and until, in the opinion of counsel for the Company, such
securities may be issued and delivered without causing the Company to be in
violation of or incur liability under any federal, state or other securities
law, any requirement of any securities exchange listing agreement to which the
Company may be a party, or any other requirement of law or of any regulatory
body having jurisdiction over the Company.
9. Stock
Option Plan. This Option is subject to, and the Company and
the Grantee agree to be bound by, all of the terms and conditions of the Plan,
as the same shall have been amended from time to time in accordance with the
terms thereof, provided that no such amendment shall deprive the Grantee,
without her consent, of this Option or any of her rights hereunder. Pursuant to
the Plan, the Committee is vested with final authority to interpret and construe
the Plan and this Option, and is authorized to adopt rules and regulations for
carrying out the Plan. A copy of the Plan in its present form is available for
inspection during business hours by the Grantee or other persons entitled to
exercise this Option at the Company’s principal office. The Plan, as
amended from time to time, is hereby incorporated by reference.
10. Notices. Any
notice to be given to the Company shall be addressed to the Company in care of
its Secretary at its principal office, and any notice to be given to the Grantee
shall be addressed to him at the address given beneath her signature hereto or
at such other address as the Grantee may hereafter designate in writing to the
Company. Any such notice shall be deemed duly given when actually delivered by
hand, facsimile, certified or registered mail or recognized overnight
courier.
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11. Laws
Applicable to Construction. This Agreement has been executed and
delivered by the Company in the State of Florida, and this Agreement shall be
construed and enforced in accordance with the laws of said State.
IN WITNESS WHEREOF, the
Company has granted this Option on March 23, 2009.
Imaging Diagnostic Systems, Inc.
ACCEPTED:
By:
/s/ Xxxxx X.
Xxxxxx By: /s/ Xxxxx X.
Xxxxxxxx
XXXXX X.
XXXXXX XXXXX
X. XXXXXXXX
Chief Executive Officer
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