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EXHIBIT 10.18
EXHIBIT D
INFOCURE CORPORATION
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of the ____
day of ________________, 1997 between INFOCURE CORPORATION, a Delaware
corporation ("Company"), and Xxxx Xxxxxx ("Executive").
WHEREAS, the Company, through its subsidiaries, has developed and is
marketing computer software programs and related services in the health care
industry and continues to develop and market such software programs and related
services;
WHEREAS, the Company agrees to employ Executive as an executive to
provide the services set forth herein; and
WHEREAS, Executive agrees to provide such services in accordance with
the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the mutual promises herein made
and of other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
1. EMPLOYMENT/DUTIES. (a) The Company shall employ Executive as
an executive during the term of his employment as set forth in this Agreement
and Executive hereby accepts such employment. Executive's initial position
shall be Chief Scientist of the Dental Division of the Company and President of
KComp Management Systems, Inc. ("Subsidiary") and shall have accountability
for the operating performance of the Dental Division. Additional
responsibilities will include assisting the Company with organization
restructuring, national marketing projects and acquisitions.
(b) Executive shall have such powers and duties as
assigned to him by the President of the Company and Board of Directors of
Subsidiary from time to time.
(c) Executive shall keep the President of the Company and
the Board of Directors of the Subsidiary timely advised of all significant
developments and opportunities and shall timely consult with the President of
the Company and the Board of Directors of the Subsidiary on all significant
policies and contracts. Executive's powers and duties are subject to the
supervision and instructions of the Board of Directors of Subsidiary and the
President of the Company.
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(d) Executive will use commercially reasonable efforts to
perform his duties during normal working hours in accordance with the
applicable business plans and budgets and policies in effect from time to time
as approved by the Board of Directors of Subsidiary.
(e) Executive agrees that he will at all times to the
best of his ability and experience faithfully perform all of the duties that
may be required of him pursuant to the terms of this Agreement. Executive
shall devote his full business time to the performance of his obligations
hereunder.
2. COMPENSATION.
(a) Base Salary.
(i) During the term of his employment, including
any extension thereof pursuant to this Agreement, the Company will pay
to Executive a base salary ("Base Salary") of $110,000 per year,
payable in arrears in equal semi-monthly payments at the Company's
normal pay periods. The Base Salary rate shall increase as of the
first anniversary of this Agreement and each subsequent anniversary by
the increase of the Consumer Price Index for All Urban Consumers (base
years 1982-1984 = 100), All Items, Los Angeles-Anaheim-Riverside for
the then most recent 12 months published by the U.S. Department of
Labor, Bureau of Labor Statistics (the "Index"). If the Index is
changed so that the base year differs, then the Index shall be
converted in accordance with the conversion factor published by the
U.S. Department of Labor, Bureau of Labor Statistics. If the Index is
discontinued or revised, then the government index or computation with
which it is replaced shall be used to obtain substantially the same
result as if the Index had not been discontinued or revised. In the
event of a disability, to the extent payments are received under an
employer-sponsored disability program, the payments hereunder are to
be reduced by an amount equal to such disability payments.
(b) Incentive Compensation.
(i) During the term of Executive's employment
hereunder, including any extension thereof, in addition to the Base
Salary as provided in paragraph 2(a)(i), Executive will be eligible
for annual incentive compensation ("Incentive Compensation") as set
forth hereinafter. Executive's Incentive Compensation shall be based
upon the Operating Income from operations of the "Dental Division" of
the Company. Initially the Dental Division shall consist only of the
Subsidiary.
(ii) The Incentive Compensation shall be a
percentage of the Operating Income as defined in the Stock Purchase
Agreement dated February 14, 1997. The fiscal year of the Dental
Division shall be the year ending each January 31. The Base Amount is
to be adjusted from time to time as set forth in subparagraph (b)(iii)
and thereafter the Incentive Compensation will be based upon the then
applicable Adjusted Base Amount. If
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the Operating Income of the Subsidiary is less than $427,000 ("Base
Amount"), no Incentive Compensation will be earned unless an
additional business(es) has been acquired and has been included in the
Dental Division and the combined Operating Income exceeds the then
applicable Adjusted Base Amount (as hereinafter defined). To the
extent that the Operating Income of the Dental Division exceeds the
Base Amount or Adjusted Base Amount, as the case may be, during a
fiscal year, Executive shall receive Incentive Compensation for each
fiscal year calculated as follows:
Range of Increase in
Operating Income Above
Base Amount or
Adjusted Base Amount Incentive Compensation
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Less than $500,001 20% of amounts above
the Base Amount or
Adjusted Base Amount
More than $500,000 but less 10% of amounts
than $1,000,001 over $500,000
More than $1,000,000 5% of amounts
over $1,000,000
(iii) The Base Amount is to be adjusted to reflect
any acquisition or disposition of businesses of the Dental Division of
the Company, in whole or in part, in good faith. The Base Amount as
adjusted from time to time is herein referred to as the "Adjusted Base
Amount." In the event an acquisition or disposition of a business
occurs during a fiscal year, the annual Adjusted Base Amount shall be
prorated for such year but the full annual Adjusted Base Amount shall
be used for all other periods.
(iv) In addition, if the Dental Division of the
Company acquires any additional business(es), the Executive is
entitled to additional Incentive Compensation equal to 5% of the
Operating Income of all such other business(es) (excluding the
Subsidiary) comprising the Dental Division of the Company during the
twelve months immediately following such acquisition, not to exceed
the Adjusted Base Amount established for such additional business(es).
(v) All business engaged in the development and
marketing of dental practice management software systems which are
hereafter acquired by Company with the assistance of Executive shall
be included in the Dental Division. Dental practice management
systems include all dental specialties excluding oral surgery and
orthodontics.
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(c) Automobile Allowance. Executive shall receive an
automobile allowance of $1,000 per month and operating costs when operated for
business purposes. The automobile allowance is payable semi-monthly together
with the Base Salary of the Executive.
(d) Business Allowance. There shall be established a
business expense allowance of $6,000 per year for each twelve-month period of
this Agreement (prorated for portions of a year) for such business expenses
incurred by the Executive in his sole discretion which are not otherwise
authorized under the Company's policies. Executive may incur, and the Company
shall pay, such business expenses as designated by the Executive not to exceed
in each twelve-month period the annual business expense allowance in the
aggregate.
(e) Employee Benefit Program. Executive shall be
eligible to participate in all employee benefit programs, including medical and
hospitalization programs, now or hereafter made available to its employees,
subject to the terms and conditions of such programs, including eligibility.
It is understood that the Company reserves the right to modify and rescind any
program or adopt new programs in its sole discretion. The Company may, in its
sole discretion, maintain key man life insurance on the life of Executive and
designate the Company as the beneficiary. Executive agrees to execute any
documents necessary to effect such policy. The Company shall use commercially
reasonable efforts to provide Executive with medical and hospital coverage
which is equivalent to that which is currently in effect for employees of the
Subsidiary for 12 months. The parties acknowledge that the Company intends to
implement uniform employee benefits throughout the Company and its subsidiaries
at reasonable costs and thus such programs will not be identical to the current
programs; provided, however, the Company will make no change that will exclude
the Executive, his spouse and members of his family from having coverage.
(f) Expenses. Executive shall be reimbursed for expenses
reasonably incurred in the performance of his duties hereunder in accordance
with the policies of the Company then in effect.
(g) Vacation. Executive shall be entitled to four (4)
weeks of vacation for each full year of service. For the period from the date
of this Agreement through December 31, 1997, Executive shall be entitled to
vacation equal to the prorated portion of such four (4) weeks (calculated as 4
times the fraction of the number of days in 1997 from the date of this
Agreement divided by 365). Vacations shall be taken at such times as not to
materially interfere with the business of the Company. The vacation time must
be taken within the time period specified in the program or as otherwise
mutually agreed in writing, otherwise it expires to the extent not used as of
each December 31.
3. TERM. The term of the employment of Executive under this
Agreement shall be for a period of two (2) years ("Initial Term") commencing on
the date hereof and ending on the second (2nd) anniversary thereof, subject to
earlier termination as provided in paragraph 4. The term of employment shall
automatically continue after the Initial Term under this Agreement,
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subject to earlier termination as provided in paragraph 4, for additional
one-year terms unless it is terminated at the end of the Initial Term or as of
any anniversary of the Initial Term, as the case may be, by either party upon
sixty (60) days prior written notice. If the employment of Executive continues
thereafter, absent a written agreement, the employment shall be at will and the
provisions of this Agreement shall be of no force and effect with respect to
such subsequent period, except for the provisions of paragraphs 5, 6, and 7.
4. EARLY TERMINATION.
(a) For Cause. (1) Notwithstanding the foregoing, the
Company may terminate the employment of Executive "for cause" (as hereinafter
defined) at any time upon written notice effective immediately. The term "for
cause" shall mean (i) the continued failure by Executive substantially to
perform his duties as provided in paragraph 1, in a reasonably professional
manner (other than due to total disability or death) for a period of thirty
(30) days after a written demand for substantial performance is delivered to
Executive by the Board of Directors or Chairman or President of the Company,
which demand identifies the manner in which the Board or Chairman or President
believes Executive has not substantially performed his duties, (ii) the
unauthorized dissemination of material trade secrets or other material
proprietary property of the Company or its parent or subsidiaries of its
parent, (iii) the conviction of a felony or any other crime involving moral
turpitude or the pleading of nolo contendere to any such act, (iv) the
commission of any act or acts of dishonesty when such acts are intended to
result or result, directly or indirectly, in financial gain or personal
enrichment of Executive or any related person or affiliated company or are
intended to cause harm or damage to the Company or its parent or subsidiaries
of its parent, (v) the illegal use of controlled substances, (vi) the use of
alcohol so as to have a material adverse effect on the performance of his
duties, (vii) the misappropriation or embezzlement of assets of the Company or
its parent or subsidiaries of its parent, (viii) the making of disparaging
remarks regarding the Company or its parent or subsidiaries of its parent or
the products or services of any such person to suppliers and/or customers of
the Company, its parent or subsidiaries of its parent, or (ix) the breach of
any other material term or provision of this Agreement to be performed by
Executive which has not been cured within thirty (30) days of his receipt of
written notice of such breach.
(2) Upon termination for cause the Company shall
have no further obligation to pay any compensation to Executive for periods
after the effective date of the termination for cause, except for Base Salary
which accrued as of the termination date. In addition, the right to exercise
any vested stock option shall terminate on the effective date of the
termination of employment for cause.
(b) Termination Upon Death or Disability.
(1) The employment of Executive shall terminate
upon his death or, ten (10) business days after written notice by the Company
of termination, upon or during the continuance of the total disability (as
hereinafter defined) of Executive.
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(2) Upon termination upon death or upon or during
total disability, the Company shall have no further obligation to pay any
compensation for periods after the effective date of such termination, except
for Base Salary (together with any expense reimbursement, accrued unused
vacation, and the accrued auto allowance per paragraph 2(c)) and Incentive
Compensation which accrued as of the termination date.
(3) The term "total disability" means the
inability of Executive to substantially perform his duties hereunder for a
continuous period of thirty (30) days unless extended in writing by the
Company. Total disability shall be deemed to commence upon the expiration of
such continuous thirty (30) day period. In the event of any dispute as to the
"total disability" of the Executive, the matter shall be resolved by the
decision of a single physician, serving as an arbitrator, mutually selected or
appointed in accordance with the rules of the American Arbitration Association,
Atlanta, Georgia. The decision of the arbitrator shall be binding on all
parties hereto. Executive agrees to submit medical records requested and to
submit to such examination and testing requested by such physician.
(c) Termination by Company without Cause.
In the event the Company terminates the employment of
the Executive, except for cause, prior to the expiration of term of this
Agreement as set forth in paragraph 3 hereof, the Company will pay Executive,
as its sole and exclusive liability hereunder, an amount equal to six (6)
months of the Executive's then current monthly base salary. Payment shall be
made within 5 days of such termination.
(d) Termination by Executive.
Executive may terminate this Agreement (i) at any
time and for any reason upon written notice, and (ii) upon the breach of any
material term or provision of this Agreement to be performed by the Company
which has not been cured within thirty (30) days (but only five (5) business
days in the event of the Company's failure to pay monies due under this
Agreement) of the Company's receipt of written notice of such breach.
5. COVENANT NOT TO COMPETE.
(a) Executive agrees that for the period commencing on
the date hereof and ending one (1) year after the expiration of the term of his
employment under this Agreement (and if employment is continued thereafter "at
will," then after termination of his employment with the Company or its parent
or subsidiaries of its parent for any reason thereafter), Executive will not,
alone or with others, directly or indirectly, own, manage, operate, join,
control, participate in the ownership, management, operation or control of, be
employed by, consult with, advise or be connected in any other manner with any
business which develops, distributes or markets software programs and/or
services which compete with the software programs and services of the kind
currently marketed by the Subsidiary for use in the United States ("Territory")
other than with the
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Company and its parent and subsidiaries of its parent. This covenant not to
compete shall not prohibit (i) ownership by Executive of not more than one
percent (1%) of the equity securities of companies listed on any United States
stock exchanges or traded over the counter or (ii) engagements which do not
involve, directly or indirectly, the development, distribution or marketing of
competitive products or services by entities engaged in such competitive
businesses. The software programs and services currently marketed by the
Subsidiary are practice management software products and services for use by
health care providers, including the utilization of EDI services by such health
care providers. This paragraph 5(a) shall terminate in the event Executive
terminates this Agreement pursuant to paragraph 4(d)(ii).
The terms "distributes" and "markets" do not include distribution of
software programs by retail software outlets.
(b) Each city and county of each state and each state in
the Territory and each month of time covered by this covenant not to compete
shall be deemed a severable unit and should any court determine that the
inclusion of all states, cities and counties or months would render any such
undertaking unreasonable or unenforceable for any reason, those units which are
necessary in the judgment of the court to be deleted in order to render such an
undertaking reasonable and enforceable shall be deemed free of such non-compete
undertaking, but such undertaking shall remain in full force and effect as to
every other unit of territory and time.
6. NON-SOLICITATION OF CUSTOMERS.
Executive agrees that during the period of one year
immediately following termination of his employment for any reason with the
Company by himself or by the Company, the Executive shall not on his own behalf
or on behalf of any other person, including any other corporation, solicit,
contact, call upon, communicate with or attempt to communicate with any
customer or prospective customer of the Company or any representative of any
customer or prospective customer of the Company with a view to the sale
(licensing or lease) of any software program or service competitive or
potentially competitive with any software program or service sold, licensed,
leased, provided or under development by the Company or any subsidiary during
the period of two years immediately preceding termination of his employment
with the Company or any subsidiary of the Company for any reason provided that
the restrictions set forth in this paragraph 6 shall apply only to customers or
prospects of the Company or representative thereof with which the Executive had
contact during such two-year period. The actions prohibited by this paragraph
6 shall not be engaged in by the Executive directly or indirectly. This
paragraph 6 shall terminate in the event Executive terminates this Agreement
pursuant to paragraph 4(d)(ii).
7. NON-SOLICITATION OF EMPLOYEES.
Executive agrees that, during his employment and for a period
of one year following termination of his employment with the Company for any
reason by himself or by the Company, the Executive will not, directly or
indirectly, solicit or in any manner encourage
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employees of the Company or any subsidiary to leave its employ for an
engagement in any capacity by another person. This paragraph 7 shall terminate
in the event Executive terminates this Agreement pursuant to paragraph
4(d)(ii).
8. DISCOVERIES, PATENTS, INVENTIONS AND COPYRIGHTS. Executive
shall execute simultaneously with the execution of this Agreement the standard
employee agreement of the Company regarding discoveries, patents, inventions
and copyrights, a copy of which is attached hereto as Exhibit A.
9. SPECIFIC PERFORMANCE. Because of his knowledge and
experience, Executive agrees that the Company shall be entitled to specific
performance or an injunction or other similar relief in addition to all other
rights and remedies it might have for any violation of the undertakings set
forth in paragraphs 5, 6 and 7 of this Agreement without the posting of a bond
or other security and without the proof of actual damages.
10. NOTICES. All notices, requests, demands and other
communications required or permitted hereunder shall be in writing and shall be
deemed to have been given upon receipt when delivered by hand or by express
mail, overnight courier or other similar method or by facsimile transmission
(provided a copy is also sent by registered or certified mail), or five (5)
days after deposit of the notice in the U.S. Mail, if mailed by certified or
registered mail, with postage prepaid addressed to the respective party as set
forth below, which address may be changed by written notice to the other party:
(a) If to the Company:
InfoCure Corporation
0000 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: President
(b) If to Executive:
Xxxx Xxxxxx
00000 Xxxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
11. BINDING EFFECT. This Agreement shall inure to the benefit of
and be binding upon and enforceable by Executive and his estate, personal
representatives and heirs, and by the Company and its successors and assigns.
This Agreement and the payments hereunder may not be assigned, pledged or
otherwise hypothecated by Executive. This Agreement may be assigned by the
Company to any subsidiary of the Company or of its parent, if any, and to any
successor of
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its business; provided, however, such assignment shall not relieve the Company
of its obligations hereunder.
12. ENTIRE AGREEMENT. This Agreement is intended by the parties
hereto to constitute the entire understanding of the parties with respect to
the employment of Executive by the Company and supersedes all prior agreements
and understandings oral or written. All prior agreements between Executive and
the Company or any subsidiary are null and void, as of the date hereof, except
for such accrued liabilities that are recorded as a liability as of such date
on the financial books and records of such company.
13. BINDING ARBITRATION/ATTORNEY FEES. Except as otherwise
specifically provided, all disputes arising under this Agreement shall be
submitted to and settled by arbitration. Arbitration shall be by one (1)
arbitrator selected in accordance with the rules of the American Arbitration
Association, Atlanta, Georgia ("AAA") by the AAA. The hearings before the
arbitrator shall be held in Atlanta, Georgia and shall be conducted in
accordance with the rules existing at the date thereof of the AAA to the extent
not inconsistent with this Agreement. The decision of the arbitrator shall be
final and binding as to any matters submitted to them under this Agreement.
All costs and expense incurred in connection with any such arbitration
proceeding and those incurred in any civil action to enforce the same shall be
borne by the party against which the decision is rendered.
14. AMENDMENTS. This Agreement may not be amended or modified
except in a writing signed by both parties.
15. WAIVERS. The failure of either party to insist upon a strict
performance of any provision hereof shall not constitute a wavier of such
provision. All waivers must be in writing.
16. GOVERNING LAW. This Agreement shall be deemed to be made in
and in all respects shall be interpreted, construed and governed by and in
accordance with the laws of the State of Georgia.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
INFOCURE CORPORATION
By:
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Name:
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Title:
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EXECUTIVE
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Name: Xxxx Xxxxxx
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