EMPLOYMENT AGREEMENT
Agreement made on September _17th_, 1999, between Xxxxxx X. Xxxxx
("Employee"), residing at 00000 Xxxxxxxx Xxxxxx, Xxxx xx Xxxx Xxxxx, Xxxxxx of
Palm Beach, State of Florida, referred to below as Employee, and VisualMED
Clinical Systems ("Employer"), a corporation organized and existing under the
laws of the Country of Canada with its principal place of business located at
000 Xxxxxxx, Xxxx of Montreal, Province of Xxxxxx, X0X0X0, Xxxxxx, referred to
below as Employer.
RECITALS
WHEREAS, Employer has developed a suite of clinical software (the "System")
based on Dr. Art Xxxxxxx'x prior hospital experiences;
WHEREAS, the principals of Employer intend to build a competitive medical
informatics business;
WHEREAS, Employer requires the services of a senior sales and marketing
executive to oversee the commercial development of its product lines in the U.S.
market;
WHEREAS, Employer proposes to hire Employee as Vice-President of Sales and
Marketing, located in Boca Raton, Florida.
In consideration of the mutual covenants and promises of the parties,
Employer and Employee agree as follows:
Section I
Employment
Employer employs Employee as Senior Sales and Marketing Executive and
Employee accepts such employment with Employer, subject to the terms and
conditions of this agreement.
Section II
Term of Employment
This agreement and the employment under it shall commence on October 1,
1999, and continue through September 30, 2001.
Section III
Duties of Employee
Employee will serve Employer faithfully and to the best of his ability
under the direction of the Chief Executive Officer of Employer. Employee will
devote all of his time, energy, and skill during regular business hours to such
employment. Employee shall perform such services and act in such executive
capacity as the Chief Executive Officer shall direct, including:
(a) The creation, development and implementation of a marketing plan
for Employer;
(b) Managing company sales;
(c) Building a sales organization as required by the growth of the
company;
(d) Participate in the orientation of the company as a member of the
executive management team;
(e) Work to meet critical milestones within the first eighteen
months; including:
(1) To prepare and submit a strategic marketing plan to
the executive management team within 45 days of
execution of this agreement.
(2) To obtain an executed contract for the placement of a
Beta System in the United States before March 31,
2000.
(3) Identify at least ten (10) viable opportunities for
contracts by April 30, 2000.
(4) To achieve a sales quota of $8,000,000 USD in the
U.S. market before June 30, 2001.
Section IV
Compensation
(a) Employee's base salary shall be at the rate of $85,000 USD per year
from October 1, 1999, through September 30, 2001, payable in equal monthly
installments beginning on October 1, 1999.
(b) In addition, a monthly draw of $5,000 USD will be paid out as an
advance against Employee bonuses and are recoverable from such bonuses, except
where specifically agreed to be not recoverable below.
(c) Upon execution of this agreement, a signing bonus of $5,000 USD
shall be paid to Employee. An additional bonus of $30,000 USD shall be paid to
Employee within ten (10) days of Employee's submission of a Marketing Plan to
the Board of Directors, or within 30 days of execution of this agreement,
whichever occurs first. All bonuses paid under this paragraph (c) are not
recoverable against draws overpaid, as contemplated by Section IV(b).
(d) If no systems are contracted for by April 30, 2000, then no draw
paid Employee through April 30, 2000 will be recoverable against any bonus paid
or payable by Employer to Employee.
(e) Moreover, no draw is recoverable from Employee when a calendar year
ends, and Employee has made insufficient sales to generate bonuses to cover such
draws.
(f) Thirty days after the signing of a contract for the placement of a
Beta System in a suitable US hospital, a bonus of $20,000 USD will be paid. For
purposes of this agreement a "Beta System" is the first of Xx. Xxxxxxx'x systems
placed at a hospital in the United States.
(g) If the Beta System is contracted for before January 31, 2000, a
bonus of $5,000 USD, in addition to the bonus in Section IV(f), will be paid
upon contract signing.
(h) Upon Employee obtaining an executed contract for the sale of the
first two systems subsequent to the sale of the Beta System, a bonus of $60,000
will be paid to Employee upon each system's contract signing. If the first of
these contracts is executed before June 31, 2000, an additional $15,000 USD
bonus will be paid upon contract signing.
(i) With each additional system contracted for (as defined in (k)
below) after the first two systems are sold subsequent to the US Beta System, a
bonus equal to but not to exceed 10% of the total contract value, minus hardware
cost, will be paid for each system contract obtained.
(j) A bonus of $5,000 USD will be paid for each system Employer obtains
a contract for outside of the United States. This bonus expires with raise in
base salary as stated in section (k) below.
(k) If Employee achieves $5,750,000 in system contracts before June 30,
2001, a bonus of $60,000 will be paid to Employee before September 30, 2001. If
Employee achieves $8,000,000 in system contracts before June 30, 2001, an
additional bonus of $40,000 will be paid to Employee before September 30, 2001.
Base salary in paragraph IV(a) will also be raised to $125,000 USD and draws
continue at $5,000 per month as of June 30, 2001 as described in Section IV,
paragraph (b). For purposes of this paragraph, "contract" includes all expected
revenue from contracts (Software, Hardware, Implementation, Service and Support
for the duration of the contract) for a system, without reduction for financing
terms.
(l) Unless otherwise provided herein, all bonuses are paid at 50% of
bonus due upon contract signing, and such payment shall be overdue if paid more
than 30 days after contract signing. The remaining 50% of bonus will be paid
upon receipt of first payment on the system.
(m) The timetable for all payments and quotas under this Section IV are
based on the system going live at the Royal Victoria no later than March 15,
2000. If the Royal Victoria system goes live after such date, Employee's time
line for goals to be met will be moved by the same period as that of the delay,
except for the quota for Employee achieving $8,000,000 before June 30, 2001, as
contemplated by Section IV, paragraph (k).
(n) In addition to the above cash compensation requirements, 20,000
shares of common stock of Employer will be issued by Employer to Employee at
contract signing, as a signing bonus.
Section V
Failure to Pay Employee
The failure of Employer to pay Employee his salary or bonuses as
provided in Section IV may, in Employee's sole discretion, be deemed a breach of
this agreement, and unless such breach is cured within ten (10) days after
written notice to Employer, this employment agreement shall terminate, and
Employee shall be compensated as provided in Section X.
Section VI
Valuation of Common Stock
(a) The common stock of Employer deliverable to Employee pursuant to
Section IV(n) shall be valued at $0.10 (ten cents) per share if there was no
public market in such common stock during the period for which stock represents
payment.
Section VII
Sale of Employee's Common Stock
(a) Employee agrees that he will not sell or otherwise dispose of all
or any part of the common stock of Employer delivered pursuant to Section IV(n),
unless he shall have received an opinion of counsel, in form and substance
satisfactory to counsel for Employer (each party to bear the expense of its own
counsel), to the effect that registration of the shares to be sold or disposed
of is not required under the Securities Act of 1933, as amended, or unless there
shall be in effect a registration statement under said Act with respect to the
proposed sale or disposition of the shares to be sold or disposed of, and
Employee shall have complied with all applicable provisions of the Act and the
rules and regulations thereunder.
(b) All certificates issued to represent the common stock delivered to
Employee shall bear the following legend: "The shares represented by this
certificate are the subject of an Employment Agreement, dated as of
____________, 1999, a copy of which is on file at the principal office of
Employer, and may not be transferred, sold or otherwise disposed of except in
accordance with the terms of such agreement."
(c) Employer is authorized to instruct its transfer agent to refuse to
transfer the certificates except in accordance with the terms of this agreement.
Section VIII
Options to Purchase Common Stock
In addition to his compensation in Section IV of this agreement,
Employer shall deliver to Employee options to purchase the common stock of
Employer, which options are in the form of Exhibit "A", attached and
incorporated by reference, according to the following schedule:
(1) Options on 50,000 shares at 0.15 CAN with contract for sale of
system one.
(2) Options on 50,000 shares at 0.15 CAN with contract for sale of
second system.
(3) Options on 100,000 shares at 0.15 CAN at meeting quota before
July 31, 2001. If quota is missed and company achieves
$10,000,000 CAN from worldwide orders before July 31, 2001
Options on 50,000 will be awarded.
(4) Options are vested for two years from date of granting.
Section IX
Reimbursement for Expenses and Benefits
Employer shall reimburse Employee for reasonable out-of-pocket
expenses, within 14 days, which Employee shall incur in connection with his
services for Employer rendered under this agreement, on presentation by Employee
of appropriate documentation to Employer. In addition, Employee will be provided
the following benefits:
(a) Medical and Dental Insurance for Employee and Employee's
spouse.
(b) Three (3) weeks paid vacation plus vacation on New Years Day,
Easter, Memorial Day, 4th of July, Labor Day, Thanksgiving,
Christmas and all U.S. Federal Holidays.
(c) Reimbursement for all usual and customary business expenses to
include lease of office space.
(d) Car allowance of $650.00 USD per month.
(e) Company will allocate one laptop computer and applicable
ancillary equipment for your business use.
Section X
Termination
(a) This agreement may be terminated, with or without cause, by
Employer on sixty (60) days written notice to Employee.
(b) If Employer shall cease conducting its business, take any action
looking toward its dissolution or liquidation, make an assignment for the
benefit of its creditors, admit in writing its inability to pay its debts as
they become due, file a voluntary, or be the subject of an involuntary petition
in bankruptcy, or be the subject of any state or federal insolvency proceeding
of any kind, then the Employee may, in his sole discretion, terminate this
agreement.
(c) In the event Employer terminates employment under Section X(a) or
Employee terminates employment under Section X(b) or Section V, a payment of six
(6) months salary, at the rate then payable, in addition to six (6) months of
draw under Section IV(b) will be made for termination of employment contract.
Employer further agrees to establish an escrow account of $60,000 appointing an
appropriate escrow agent, upon execution of a contract for the Beta System. This
employer will deposit twelve (12) equal monthly payments to the escrow account
beginning the month of receipt of the Beta System contract. Termination of
Employee after one (1) year of employment will result in a payment of one year's
base salary and one year of draw. If at anytime the company is sold, Employee
will be guaranteed two (2) years of full employment or a severance payment at a
rate equal to his highest earnings in any previous year.
Section XI
Binding Effect
This agreement shall be binding on and shall inure to the benefit of
any successor or successors of Employer and the personal representatives of
Employee.
Section XII
Assignment
This contract is assignable by Employee to a corporation, or other
fictitious entity owned 100% by Employee.
Section XIII
Arbitration
The parties agree that any dispute or claim concerning this agreement
or the terms and conditions of employment, including whether such dispute or
claims are arbitrable, will be settled by arbitration. The arbitration
proceedings shall be conducted under the commercial arbitration rules of the
American Arbitration Association in effect at the time the demand for
arbitration under the rules is made. The decision of the arbitrators, including
determination of amount of any damages suffered, shall be exclusive, final and
binding on both parties, their heirs, executors, administrators, successors, and
assigns. All expenses in the arbitration for arbitrators, fees and attorneys
fees, for its witnesses and other expenses of presenting its case, shall be
borne by Employer. Other arbitration costs, including administrative fees and
fees for records and transcripts, shall also be borne by the Employer.
XIV
Attorneys Fees and Costs
In the event of any litigation over this contract, Employer shall be
responsible for all Employee's reasonable attorneys fees and costs, through
appeal, to remedy amounts due under this contract, or for any other equitable
rulings.
XV
Law to Govern Contract
This agreement shall be governed by the laws of the State of Florida
where jurisdiction shall lie in Broward County, Florida. Employer, a foreign
corporation, agrees to register to do business in the State of Florida to
accomplish this end.
XVI
Non-competition
Employee will not be permitted to solicit company clients for one year
after leaving employment of the company. Employee will not disclose confidential
information regarding company proprietary software or trade secrets under
requisite US and state laws governing intellectual property.
IN WITNESS WHEREOF, the parties agree to the terms of this Employment
Agreement on this __17th__ day of September, 1999.
VisualMED Clinical Systems,
a Canadian corporation
By: /s/ Chafye Xxxxx /s/ Xxxxxx Xxxxx
Chafye Xxxxx Xxxxxx Xxxxx
Title: C.E.O.
Date: September 17th 1999 Date:9/17/99
