EXHIBIT 10.3
EMPLOYMENT AGREEMENT
AGREEMENT (the "AGREEMENT"), dated February 1, 2008 but effective
January 1, 2007, by and between MEDICAL CONNECTIONS HOLDINGS, INC., (the
"COMPANY"), and XXXXXX XXXXXX (the "EXECUTIVE").
W I T N E S S E T H:
WHEREAS, the Company desires to continue to employ the Executive as
Chief Executive Officer of the Company, and the Executive desires to continue to
serve the Company in those capacities, upon the terms and subject to the
conditions contained in this Agreement; and
WHEREAS, the Executive has served as the Company's chief executive
officer pursuant to the terms and conditions of an oral employment agreement;
and
WHEREAS, the Company and the Executive deem it to be in their mutual
best interests to memorialize the terms and conditions of the Executive's
continued employment.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto hereby agree as follows:
1. Employment.
(a) Services. The Executive will be employed by the Company as its
chief executive officer. The Executive will report to the Board of Directors of
the Company (the "Board") and shall perform such duties as are consistent with
your position as Chief Executive Officer (the "Services"). The Executive agrees
to perform such duties faithfully, to devote all of his working time, attention
and energies to the business of the Company, and while he remains employed, not
to engage in any other business activity that is in conflict with your duties
and obligations to the Company.
(b) Acceptance. Executive hereby accepts such employment and agrees
to render the Services.
2. Term.
The Executive's employment under this Agreement (the "Term") shall
commence as of the Effective Date (as hereinafter defined) and shall continue
for a term of two (2) years, unless sooner terminated pursuant to Section 9 of
this Agreement. Notwithstanding anything to the contrary contained herein, the
provisions of this Agreement governing protection of Confidential Information
shall continue in effect as specified in Section 6 hereof and survive the
expiration or termination hereof. The Term may be extended for additional one
(1) year periods upon mutual written consent of the Executive and the Board.
3. Best Efforts; Place of Performance.
(a) The Executive shall devote substantially all of his business
time, attention and energies to the business and affairs of the Company and
shall use his best efforts to advance the best interests of the Company and
shall not during the Term be actively engaged in any other business activity,
whether or not such business activity is pursued for gain, profit or other
pecuniary advantage, that will interfere
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with the performance by the Executive of his duties hereunder or the Executive's
availability to perform such duties or that will adversely affect, or negatively
reflect upon, the Company.
(b) The duties to be performed by the Executive hereunder shall be
performed primarily at the office of the Company in Boca Raton, Florida, subject
to reasonable travel requirements on behalf of the Company, or such other place
as the Board may reasonably designate.
4. Directorship. The Company shall use its best efforts to cause the
Executive to be elected as a member of its Board of Directors throughout the
Term and shall include him in the management slate for election as a director at
every stockholders meeting during the Term at which his term as a director would
otherwise expire. The Executive agrees to accept election, and to serve during
the Term, as director of the Company, without any compensation therefor other
than as specified in this Agreement.
5. Compensation. As full compensation for the performance by the Executive
of his duties under this Agreement, the Company shall pay the Executive as
follows:
(a) Base Salary. The Company shall pay Executive a salary (the "Base
Salary") equal to $300,000 per year. Payment shall be made semi-monthly, on the
last day of each calendar month or as agreed between the Company and the
Executive.
(b) Discretionary Bonus. At the sole discretion of the Board of
Directors of the Company, the Executive shall receive an additional annual bonus
(the "DISCRETIONARY BONUS") in an amount equal to up to 33% of his Base Salary,
based upon his performance on behalf of the Company during the prior year.
Factors to be considered by the Board of Directors shall include, but not be
limited to, significant growth in the Company's market capitalization, the
liquidity and performance of the Company's Common Stock, as well as any
financing received by the Company from third parties introduced to the Company
by the Executive or facilitated by the Executive.. The Discretionary Bonus shall
be payable either as a lump-sum payment or in installments as determined by the
Board of Directors of the Company in its sole discretion. In addition, the Board
of Directors of the Company shall annually review the Bonus to determine whether
an increase in the amount thereof is warranted.
(c) Stock Options. As additional compensation for the services to be
rendered by the Executive pursuant to this Agreement, the Board of Directors
may, in their sole and absolute discretion issue additional shares of Common
Stock or Common Stock Options to the Executive in consideration for services
rendered pursuant to any type of equity compensation plan then in effect.
(d) Expenses. The Company shall reimburse the Executive for all
normal, usual and necessary expenses incurred by the Executive in furtherance of
the business and affairs of the Company, including reasonable travel and
entertainment, upon timely receipt by the Company of appropriate vouchers or
other proof of the Executive's expenditures and otherwise in accordance with any
expense reimbursement policy as may from time to time be adopted by the Company.
Executive shall also be entitled to receive an annual gas allowance of $5,000.
(e) Other Benefits. The Executive shall be entitled to all rights
and benefits for which he shall be eligible under any benefit or other plans
(including, without limitation, dental, medical, medical reimbursement and
hospital plans, pension plans, employee stock purchase plans, profit sharing
plans,
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bonus plans and other so-called "fringe" benefits) as the Company shall make
available to its senior executives from time to time.
(f) Vacation. The Executive shall, during the Term, be entitled to a
vacation of four (4) weeks per annum, in addition to holidays observed by the
Company. The Executive shall not be entitled to carry any vacation forward to
the next year of employment and shall not receive any compensation for unused
vacation days.
6. Confidential Information and Inventions.
(a) The Executive recognizes and acknowledges that in the course of
his duties he is likely to receive confidential or proprietary information owned
by the Company, its affiliates or third parties with whom the Company or any
such affiliates has an obligation of confidentiality. Accordingly, during and
after the Term, the Executive agrees to keep confidential and not disclose or
make accessible to any other person or use for any other purpose other than in
connection with the fulfillment of his duties under this Agreement, any
Confidential and Proprietary Information (as defined below) owned by, or
received by or on behalf of, the Company or any of its affiliates. "Confidential
and Proprietary Information" shall include, but shall not be limited to,
business plans (both current and under development), client lists, promotion and
marketing programs, trade secrets, or any other confidential or proprietary
business information relating to business operations of the Company The
Executive expressly acknowledges the trade secret status of the Confidential and
Proprietary Information and that the Confidential and Proprietary Information
constitutes a protectable business interest of the Company. The Executive
agrees: (i) not to use any such Confidential and Proprietary Information for
himself or others; and (ii) not to take any Company material or reproductions
(including but not limited to writings, correspondence, notes, drafts, records,
invoices, technical and business policies, computer programs or disks) thereof
from the Company's offices at any time during his employment by the Company,
except as required in the execution of the Executive's duties to the Company.
The Executive agrees to return immediately all Company material and
reproductions (including but not limited, to writings, correspondence, notes,
drafts, records, invoices, technical and business policies, computer programs or
disks) thereof in his possession to the Company upon request and in any event
immediately upon termination of employment.
(b) Except with prior written authorization by the Company, the
Executive agrees not to disclose or publish any of the Confidential and
Proprietary Information, or business information of any other party to whom the
Company or any of its affiliates owes an obligation of confidence, at any time
during or after his employment with the Company.
7. Non-Competition, Non-Solicitation and Non-Disparagement.
(a) The Executive understands and recognizes that his services to the
Company are special and unique and that in the course of performing such
services the Executive will have access to and knowledge of Confidential and
Proprietary Information (as defined in Section 6) and the Executive agrees that,
during the Term and for a period of six (6) months thereafter, he shall not in
any manner, directly or indirectly, on behalf of himself or any person, firm,
partnership, joint venture, corporation or other business entity ("PERSON"),
enter into or engage in any business which is engaged in any business directly
or indirectly competitive with the business of the Company, either as an
individual for his own account, or as a partner, joint venturer, owner,
executive, employee, independent contractor, principal, agent, consultant,
salesperson, officer, director or shareholder of a Person in a business
competitive with the Company within the geographic area of the Company's
business, which is deemed by the parties hereto to be the United States. The
Executive acknowledges that, due to the unique nature of the Company's business,
the loss of any of its clients or business flow or the improper
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use of its Confidential and Proprietary Information could create significant
instability and cause substantial damage to the Company and its affiliates and
therefore the Company has a strong legitimate business interest in protecting
the continuity of its business interests and the restriction herein agreed to by
the Executive narrowly and fairly serves such an important and critical business
interest of the Company. For purposes of this Agreement, the Company shall be
deemed to be actively engaged in the business of medical staffing placements.
Notwithstanding the foregoing, nothing contained in this Section 7(a) shall be
deemed to prohibit the Executive from (i) acquiring or holding, solely for
investment, publicly traded securities of any corporation, some or all of the
activities of which are competitive with the business of the Company so long as
such securities do not, in the aggregate, constitute more than three percent
(3%) of any class or series of outstanding securities of such corporation.
(b) During the Term and for a period of 6 months thereafter, the
Executive shall not, directly or indirectly, without the prior written consent
of the Company:
(i) solicit or induce any employee of the Company or any of
its affiliates to leave the employ of the Company or any such affiliate; or hire
for any purpose any employee of the Company or any affiliate or any employee who
has left the employment of the Company or any affiliate within one year of the
termination of such employee's employment with the Company or any such affiliate
or at any time in violation of such employee's non-competition agreement with
the Company or any such affiliate; or
(ii) solicit or accept employment or be retained by any Person
who, at any time during the term of this Agreement, was an agent, client or
customer of the Company or any of its affiliates where his position will be
related to the business of the Company or any such affiliate; or (iii) solicit
or accept the business of any agent, client or customer of the Company or any of
its affiliates with respect to products, services or investments similar to
those provided or supplied by the Company or any of its affiliates.
(c) The Company and the Executive each agree that both during the
Term and at all times thereafter, neither party shall directly or indirectly
disparage, whether or not true, the name or reputation of the other party or any
of its affiliates, including but not limited to, any officer, director, employee
or shareholder of the Company or any of its affiliates.
(d) In the event that the Executive breaches any provisions of
Section 6 or this Section 7 or there is a threatened breach, then, in addition
to any other rights which the Company may have, the Company shall (i) be
entitled, without the posting of a bond or other security, to injunctive relief
to enforce the restrictions contained in such Sections and (ii) have the right
to require the Executive to account for and pay over to the Company all
compensation, profits, monies, accruals, increments and other benefits
(collectively "BENEFITS") derived or received by the Executive as a result of
any transaction constituting a breach of any of the provisions of Sections 6 or
7 and the Executive hereby agrees to account for and pay over such Benefits to
the Company.
(e) Each of the rights and remedies enumerated in Section 7(d) shall
be independent of the others and shall be in addition to and not in lieu of any
other rights and remedies available to the Company at law or in equity. If any
of the covenants contained in this Section 7, or any part of any of them, is
hereafter construed or adjudicated to be invalid or unenforceable, the same
shall not affect the remainder of the covenant or covenants or rights or
remedies which shall be given full effect without regard to the invalid
portions. If any of the covenants contained in this Section 7 is held to be
invalid or
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unenforceable because of the duration of such provision or the area covered
thereby, the parties agree that the court making such determination shall have
the power to reduce the duration and/or area of such provision and in its
reduced form such provision shall then be enforceable. No such holding of
invalidity or unenforceability in one jurisdiction shall bar or in any way
affect the Company's right to the relief provided in this Section 7 or otherwise
in the courts of any other state or jurisdiction within the geographical scope
of such covenants as to breaches of such covenants in such other respective
states or jurisdictions, such covenants being, for this purpose, severable into
diverse and independent covenants.
(f) In the event that an actual proceeding is brought in equity to
enforce the provisions of Section 6 or this Section 7, the Executive shall not
urge as a defense that there is an adequate remedy at law nor shall the Company
be prevented from seeking any other remedies which may be available. The
Executive agrees that he shall not raise in any proceeding brought to enforce
the provisions of Section 6 or this Section 7 that the covenants contained in
such Sections limit his ability to earn a living.
(g) The provisions of this Section 7 shall survive any termination
of this Agreement.
8. Representations and Warranties by the Executive.
The Executive hereby represents and warrants to the Company as
follows:
(i) Neither the execution or delivery of this Agreement nor
the performance by the Executive of his duties and other obligations hereunder
violate or will violate any statute, law, determination or award, or conflict
with or constitute a default or breach of any covenant or obligation under
(whether immediately, upon the giving of notice or lapse of time or both) any
prior employment agreement, contract, or other instrument to which the Executive
is a party or by which he is bound.
(ii) The Executive has the full right, power and legal
capacity to enter and deliver this Agreement and to perform his duties and other
obligations hereunder. This Agreement constitutes the legal, valid and binding
obligation of the Executive enforceable against him in accordance with its
terms. No approvals or consents of any persons or entities are required for the
Executive to execute and deliver this Agreement or perform his duties and other
obligations hereunder.
9. Termination. The Executive's employment hereunder shall be terminated
upon the Executive's death and may be terminated as follows:
(a) The Executive's employment hereunder may be terminated by the
Board of Directors of the Company for Cause. Any of the following actions by the
Executive shall constitute "CAUSE":
(i) The willful failure, disregard or refusal by the Executive
to perform his duties hereunder;
(ii) Any willful, intentional or grossly negligent act by the
Executive having the effect of injuring, in a material way (whether financial or
otherwise and as determined in good-faith by a majority of the Board of
Directors of the Company), the business or reputation of the Company or any of
its affiliates, including but not limited to, any officer, director, executive
or shareholder of the Company or any of its affiliates;
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(iii) Willful misconduct by the Executive in respect of the
duties or obligations of the Executive under this Agreement, including, without
limitation, insubordination with respect to directions received by the Executive
from the Board of Directors of the Company;
(iv) The Executive's indictment of any felony or a misdemeanor
involving moral turpitude (including entry of a nolo contendere plea);
(v) The determination by the Company, after a reasonable and
good-faith investigation by the Company following a written allegation by
another employee of the Company, that the Executive engaged in some form of
harassment prohibited by law (including, without limitation, age, sex or race
discrimination), unless the Executive's actions were specifically directed by
the Board of Directors of the Company;
(vi) Any misappropriation or embezzlement of the property of
the Company or its affiliates (whether or not a misdemeanor or felony);
(vii) Breach by the Executive of any of the provisions of
Sections 6, 7 or 8 of this Agreement; and (viii) Breach by the Executive of any
provision of this Agreement other than those contained in Sections 6, 7 or 8
which is not cured by the Executive within thirty (30) days after notice thereof
is given to the Executive by the Company.
(b) The Executive's employment hereunder may be terminated by the
Board of Directors of the Company due to the Executive's Disability. For
purposes of this Agreement, a termination for "DISABILITY" shall occur (i) when
the Board of Directors of the Company has provided a written termination notice
to the Executive supported by a written statement from a reputable independent
physician to the effect that the Executive shall have become so physically or
mentally incapacitated as to be unable to resume, within the ensuing twelve (12)
months, his employment hereunder by reason of physical or mental illness or
injury, or (ii) upon rendering of a written termination notice by the Board of
Directors of the Company after the Executive has been unable to substantially
perform his duties hereunder for 90 or more consecutive days, or more than 120
days in any consecutive twelve month period, by reason of any physical or mental
illness or injury. For purposes of this Section 9(b), the Executive agrees to
make himself available and to cooperate in any reasonable examination by a
reputable independent physician retained by the Company.
(c) The Executive's employment hereunder may be terminated by the
Executive for Good Reason. For purposes of this Agreement, "GOOD REASON" shall
mean any of the following: (i) the assignment to the Executive of duties
inconsistent with the Executive's position, duties, responsibilities, titles or
offices as described herein; (ii) any material reduction by the Corporation of
the Executive's duties and responsibilities; or (iii) any reduction by the
Corporation of the Executive's compensation or benefits payable hereunder (it
being understood that a reduction of benefits applicable to all employees of the
Corporation, including the Executive, shall not be deemed a reduction of the
Executive's compensation package for purposes of this definition).
10. Compensation upon Termination.
(a) If the Executive's employment is terminated as a result of his
death or Disability, the Company shall pay to the Executive or to the
Executive's estate, as applicable, (x) his Base Salary and any accrued but
unpaid Bonus and expense reimbursement amounts through the date of his Death or
Disability. All Stock Options that are scheduled to vest by the end of the
calendar year in which such termination occurs shall be accelerated and deemed
to have vested as of the termination date. All Stock
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Options that have not vested (or been deemed pursuant to the immediately
preceding sentence to have vested) as of the date of termination shall be deemed
to have expired as of such date.
(b) If the Executive's employment is terminated by the Board of
Directors of the Company for Cause, then the Company shall pay to the Executive
his Base Salary through the date of his termination and the Executive shall have
no further entitlement to any other compensation or benefits from the Company.
All Stock Options that have not vested as of the date of termination shall be
deemed to have expired as of such date. Any Stock Options that have vested as of
the date of the Executive's termination for Cause shall remain exercisable for a
period of 90 days.
(c) If the Executive's employment is terminated by the Company other
than as a result of the Executive's death or Disability and other than for
reasons specified in Sections 10(b) then the Company shall (i) continue to pay
to the lesser of the Executive's Base Salary for a period of one year following
such termination or the remaining term under his employment agreement, and (ii)
pay the Executive any expense reimbursement amounts owed through the date of
termination. The Company's obligation under clauses (i) and (ii) in the
preceding sentence shall be subject to offset by any amounts otherwise received
by the Executive from any employment during the one year period following the
termination of his employment. All Stock Options that are scheduled to vest by
the end of the calendar year in which such termination occurs shall be
accelerated and deemed to have vested as of the termination date. All Stock
Options that have not vested (or been deemed pursuant to the immediately
preceding sentence to have vested) as of the date of termination shall be deemed
to have expired as of such date. Any Stock Options that have vested as of the
date of the Executive's termination shall remain exercisable for a period of 90
days.
(d) This Section 10 sets forth the only obligations of the Company
with respect to the termination of the Executive's employment with the Company,
and the Executive acknowledges that, upon the termination of his employment, he
shall not be entitled to any payments or benefits which are not explicitly
provided in Section 10.
(e) Upon termination of the Executive's employment hereunder for any
reason, the Executive shall be deemed to have resigned as director of the
Company, effective as of the date of such termination.
(f) The provisions of this Section 10 shall survive any termination
of this Agreement.
11. Miscellaneous.
(a) This Agreement shall be governed by, and construed and
interpreted in accordance with, the laws of the State of Florida, without giving
effect to its principles of conflicts of laws.
(b) Any dispute arising out of, or relating to, this Agreement or
the breach thereof (other than Sections 6 or 7 hereof), or regarding the
interpretation thereof, shall be finally settled by arbitration conducted in
Palm Beach County, Florida in accordance with the rules of the American
Arbitration Association then in effect before a single arbitrator appointed in
accordance with such rules. Judgment upon any award rendered therein may be
entered and enforcement obtained thereon in any court having jurisdiction. The
arbitrator shall have authority to grant any form of appropriate relief, whether
legal or equitable in nature, including specific performance. For the purpose of
any judicial proceeding to enforce such award or incidental to such arbitration
or to compel arbitration and for purposes of Sections 6 and 7 hereof, the
parties hereby submit to the non-exclusive jurisdiction of the Circuit Court in
and for Palm Beach County, Florida and agree that service of process in such
arbitration or court
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proceedings shall be satisfactorily made upon it if sent by registered mail
addressed to it at the address referred to in paragraph (g) below. The costs of
such arbitration shall be borne proportionate to the finding of fault as
determined by the arbitrator. Judgment on the arbitration award may be entered
by any court of competent jurisdiction.
(c) This Agreement shall be binding upon and inure to the benefit of
the parties hereto, and their respective heirs, legal representatives,
successors and assigns.
(d) This Agreement, and the Executive's rights and obligations
hereunder, may not be assigned by the Executive. The Company may assign its
rights, together with its obligations, hereunder in connection with any sale,
transfer or other disposition of all or substantially all of its business or
assets.
(e) This Agreement cannot be amended orally, or by any course of
conduct or dealing, but only by a written agreement signed by the parties
hereto.
(f) The failure of either party to insist upon the strict
performance of any of the terms, conditions and provisions of this Agreement
shall not be construed as a waiver or relinquishment of future compliance
therewith, and such terms, conditions and provisions shall remain in full force
and effect. No waiver of any term or condition of this Agreement on the part of
either party shall be effective for any purpose whatsoever unless such waiver is
in writing and signed by such party.
(g) All notices, requests, consents and other communications,
required or permitted to be given hereunder, shall be in writing and shall be
delivered personally or by an overnight courier service or sent by registered or
certified mail, postage prepaid, return receipt requested, and shall be deemed
given when so delivered personally or by overnight courier, or, if mailed, five
days after the date of deposit in the United States mails.
(h) This Agreement sets forth the entire agreement and understanding
of the parties relating to the subject matter hereof, and supersedes all prior
agreements, arrangements and understandings, written or oral, relating to the
subject matter hereof. No representation, promise or inducement has been made by
either party that is not embodied in this Agreement, and neither party shall be
bound by or liable for any alleged representation, promise or inducement not so
set forth.
(i) As used in this Agreement, "affiliate" of a specified Person
shall mean and include any Person controlling, controlled by or under common
control with the specified Person.
(j) The section headings contained herein are for reference purposes
only and shall not in any way affect the meaning or interpretation of this
Agreement.
(k) This Agreement may be executed in any number of counterparts,
each of which shall constitute an original, but all of which together shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first above written.
MEDICAL CONNECTIONS HOLDINGS, INC.
/s/Xxxxxxx Xxxxxxxx
--------------------------------
BY: XXXXXXX XXXXXXXX, PRESIDENT
EXECUTIVE:
/s/Xxxxxx Xxxxxx
--------------------------------
XXXXXX XXXXXX
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