Exhibit 10.4

 

TRXADE GROUP, INC.

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”) is entered into this 14th
day of April 2020, to be effective as of the Effective Date as defined below
between Trxade Group, Inc., a Delaware corporation (the “Company”), and Suren
Ajjarapu, an individual (the “Executive”) (each of the Company and Executive are
referred to herein as a “Party”, and collectively referred to herein as the
“Parties”).

 

WITNESSETH:

 

WHEREAS, the Executive currently serves as the Chief Executive Officer of the
Company;

 

WHEREAS, the Executive is currently party to an Executive Employment Agreement
dated on or around May 15, 2013 with Trxade, Inc., a Florida corporation, the
wholly-owned subsidiary of the Company (the “Prior Agreement”)1; and

 

WHEREAS, the Company desires to replace and supersede the Prior Agreement with
this Agreement and to continue to obtain the services of Executive, and
Executive desires to replace the Prior Agreement with this Agreement and to
continue to be employed by the Company upon the terms and conditions hereinafter
set forth.

 

NOW, THEREFORE, in consideration of the premises, the agreements herein
contained and other good and valuable consideration, receipt and sufficiency of
which are hereby acknowledged, the Parties hereto agree as of the Effective Date
as follows:

 

ARTICLE I.

EMPLOYMENT; TERM; DUTIES

 

1.1. Employment. Pursuant to the terms and conditions hereinafter set forth, the
Company hereby employs Executive, and Executive hereby accepts such employment,
as the Chief Executive Officer (“CEO”) of the Company for a period beginning on
the Effective Date and ending on December 31, 2025 (the “Initial Term”);
provided that this Agreement shall automatically extend for additional one (1)
year periods after the Initial Term (each an “Automatic Renewal Term”) in the
event that neither Party provides the other written notice of their intent not
to automatically extend the term of this Agreement at least sixty (60) days
prior to the end of the Initial Term or any Automatic Renewal Term, as
applicable (each a “Non-Renewal Notice”). The Initial Term and any Automatic
Renewal Terms, the “Term”.

 

1.2. Duties and Responsibilities. Executive, as Chief Executive Officer shall
devote his attention and energies to the business of the Company and will
diligently and to the best of his ability perform all duties incident to his
employment hereunder. The Executive, as CEO, shall perform such administrative,
managerial and executive duties for the Company (i) as are prescribed by
applicable job specifications for the chief executive officer of a public
company the size and nature of the Company, (ii) as may be prescribed by the
Bylaws of the Company, (iii) as are customarily vested in and incidental to such
position, and (iv) as may be assigned to him from time to time by the Board of
Directors of the Company (the “Board”). Nothing herein shall require the
Executive to perform his services at the Company’s headquarters or at any
specific location to the extent he can provide such services remotely.

 

1.3. Non-Competition. For $10 and other good and valuable consideration which
Executive acknowledges the receipt and sufficiency of, Executive agrees to (a)
devote at least 75% of Executive’s business time, energy and efforts to the
business of the Company (except as specifically provided for in Section 1.4
below), (b) to use Executive’s best efforts and abilities faithfully and
diligently to promote the business interests of the Company and (c) to comply
with the other terms and conditions of this Section 1.3. For so long as
Executive is employed hereunder, and for a period of twelve (12) months
thereafter (the “Non-Compete Period”), Executive (whether by himself, through
his employers or employees or agents or otherwise, and whether on his own behalf
or on behalf of any other Person) shall not, directly or indirectly, either as
an employee, employer, consultant, agent, investor, principal, partner,
stockholder (except as the holder of less than 1% of the issued and outstanding
stock of a publicly held corporation), own, manage, operate, control, be
employed by, act as an officer, director, agent or consultant for, or be in any
other way connected with or provide services or products to or for, any Person
in the business of manufacturing, selling, creating, distributing, marketing,
producing, undertaking, developing, supplying, or otherwise dealing with or in
Restricted Services or Restricted Products in the Restricted Area (the
“Post-Employment Non-Competition Requirement”).

 

 

1
https://www.sec.gov/Archives/edgar/data/1382574/000107878214001329/form10_ex10z5.htm

 

 

 

 

1.3.1 For purposes of this Section 1.3, the following terms shall have the
following meanings:

 

(i) “Person” means any individual, corporation, partnership, joint venture,
limited liability company, trust, unincorporated organization or governmental
entity.

 

(ii) “Restricted Area” means (A) any State (in the United States); and/or (B)
any other geographic area (Providence, if such Restricted Area is in Canada, or
country, if such Restricted Area is in a country other than the United States or
Canada), in which the Company or any of its Subsidiaries provides Restricted
Services or Restricted Products, directly or indirectly, during the twelve
months preceding the Termination Date of Executive’s employment hereunder.

 

(iii) “Restricted Products” means pharmaceutical drugs and other healthcare
products and any other product, that the Company or any of its Subsidiaries has
provided or is researching, developing, manufacturing, distributing, purchasing,
selling and/or providing at any time during the two years immediately preceding
the Termination Date, or which the Executive obtained any trade secret or other
Confidential/Trade Secret Information (as defined in Section 4.2, below) about
at any time during the two years immediately preceding the Termination Date as a
result of his employment with the Company, consulting services provided to the
Company, or which he became aware of as a result of his position as a director
of the Company.

 

(iv) “Restricted Services” means the manufacture, distribution, wholesale and
sale of Restricted Products, healthcare services and any other services that the
Company or any of its Subsidiaries has provided or is researching, developing,
performing and/or providing at any time during the two years immediately
preceding the Termination Date, or which Executive obtained any trade secret or
other Confidential/Trade Secret Information (as defined in Section 4.2, below)
about at any time during the two years immediately preceding the Termination
Date as a result of his employment with the Company, consulting services
provided to the Company, or which he became aware of as a result of his position
as a director of the Company.

 

(v) “Subsidiary” or “Subsidiaries” means any or all Persons of which the Company
owns directly or indirectly through another Person, a nominee arrangement or
otherwise (a) at least 20% of the outstanding capital stock (or other shares of
beneficial interest) entitled to vote generally or otherwise have the power to
elect a majority of the board of directors or similar governing body or the
legal power to direct the business or policies of such Person or (b) at least
20% of the economic interests of such Person.

 

1.4. Other Activities. Subject to the foregoing prohibition and provided such
services or investments do not violate any applicable law, regulation or order,
or interfere in any way with the faithful and diligent performance by Executive
of the services to the Company otherwise required or contemplated by this
Agreement, the Company expressly acknowledges that Executive may:

 

1.4.1 make and manage personal business investments of Executive’s choice
without consulting the Board;

 

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1.4.2 serve in any capacity with any non-profit civic, educational or charitable
organization; and

 

1.4.3 undertake any other actions, business transactions, agreements and
undertakings which the Executive has received approval of the Board to enter
into and/or undertake, provided that

 

1.4.4 Executive may only undertake such actions or services that do not
interfere with the Executive’s obligations hereunder.

 

1.5. Board of Directors. Provided that Executive is still employed hereunder,
the Board shall nominate Executive to be elected to serve on the Board at each
meeting of the Company’s stockholders held during the term of this Agreement to
elect directors, consistent with the provisions of the Bylaws and Certificate of
Incorporation of the Company, as amended and in effect from time to time.
Additionally, for so long as the Executive serves as a member of the Board, the
Board shall, appoint the Executive as the Chairman of the Board, unless they
deem it inappropriate or in the Company’s best interests not to.

 

1.6. Covenants of Executive.

 

1.6.1 Best Efforts. Executive shall devote his best efforts to the business and
affairs of the Company. Executive shall perform his duties, responsibilities and
functions to the Company hereunder to the best of his abilities in a diligent,
trustworthy, professional and efficient manner and shall comply, in all material
respects, with all rules and regulations of the Company (and special
instructions of the Board, if any) and all other rules, regulations, guides,
handbooks, procedures and policies applicable to the Company and its business in
connection with his duties hereunder, including all United States federal and
state securities laws applicable to the Company.

 

1.6.2 Records. Executive shall use his best efforts and skills to truthfully,
accurately, and promptly prepare, maintain, and preserve all records and reports
that the Company may, from time to time, request or require, fully account for
all money, records, equipment, materials, or other property belonging to the
Company of which he may have custody, and promptly pay and deliver the same
whenever he may be directed to do so by the Board.

 

1.6.3 Compliance. Executive shall use his best efforts to maintain the Company’s
compliance with all rules and regulations of the Securities and Exchange
Commission (“SEC”), and reporting requirements for publicly traded companies,
including, without limitation, overseeing and filing with the SEC all periodic
reports the Company is required to file under the Securities Exchange Act of
1934, as amended (the “Exchange Act”). Executive shall at all times comply, and
cause the Company to comply, with the then-current good corporate governance
standards and practices as prescribed by the SEC, any exchange on which the
Company’s capital stock or other securities may be traded and any other
applicable governmental entity, agency or organization.

 

1.6.4 Exchange Act Filing Requirements. The Executive agrees and acknowledges
that due to the Executive’s status as a Section 16(a) “officer” of the Company
(as described in Rule 16a-1(f) of the Exchange Act), he has an obligation to
file various beneficial ownership reports and forms with the Securities and
Exchange Commission, including Form’s 3, 4 and 5 (where applicable) and that
such obligation is solely the Executive’s regardless of whether the Company
assists the Executive in filing such forms or not. The Executive agrees to use
his best efforts to timely and adequately file all required beneficial ownership
reports and forms required under the Exchange Act.

 

1.7. Effective Date. The “Effective Date” of this Agreement shall be April 14,
2020.

 

1.8. At Will Employment, Confidential Information, Invention Assignment and
Arbitration Agreement. A required condition to the Company’s acceptance of this
Agreement is the entry by the Executive into the At Will Employment,
Confidential Information, Invention Assignment and Arbitration Agreement in the
form of Exhibit A attached hereto.

 

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ARTICLE II.

COMPENSATION AND OTHER BENEFITS

 

2.1. Base Salary. So long as this Agreement remains in effect, for all services
rendered by Executive hereunder and all covenants and conditions undertaken by
the Parties pursuant to this Agreement, the Company shall pay, and Executive
shall accept, as compensation, an annual base salary (“Base Salary”) of
$300,000. The Base Salary shall be payable in regular installments in accordance
with the normal payroll practices of the Company, in effect from time to time,
but in any event no less frequently than on a monthly basis. For so long as
Executive is employed hereunder, beginning December 31, 2020, and on each
December 31st thereafter, the Base Salary may be increased as determined by the
Compensation Committee of the Board (the “Compensation Committee”), in its sole
and absolute discretion. Additionally, in the event that Executive meets at
least 70% of the requirements for any annual Performance Bonus, as determined in
the reasonable discretion of the Compensation Committee of the Board of
Directors, pursuant to the timeline and requirements of Section 2.3 hereof,
Executive’s Base Salary shall increase by 20% (effective upon confirmation by
the Compensation Committee that such metrics were met)(the “Base Salary
Increase”). Executive shall be eligible for the Base Salary Increase on an
annual basis with such increases being cumulative. Such increases in salary
shall be documented in the Company’s records, but shall not require the Parties
enter into a new or amended form of this Agreement.

 

2.2. Discretionary Bonus. Executive shall be eligible for a yearly discretionary
cash, stock or equity bonus (a “Discretionary Bonus”) equal to an amount as
determined by the Compensation Committee of the Board of Directors (the
“Committee”) and based on the condition of the Company’s business and results of
operations, and the Committee’s evaluation of Executive’s individual performance
for the relevant period and/or such other matters as the Committee in its
discretion may deem relevant. Each Discretionary Bonus shall be paid in the
Committee’s discretion.

 

2.3. Performance Bonus. Executive shall be eligible for a yearly performance
bonus (a “Performance Bonus”) equal to up to 100% of the Base Salary as
determined by the Committee and based performance metrics agreed to in advance
by the Executive and the Committee (the “Performance Metrics”). The Performance
Metrics for the twelve months ended December 31, 2020 are attached hereto as
Exhibit B (the “2020 Performance Metrics”). Future Performance Metrics shall be
agreed upon by the Committee and the Executive, and shall not require an
amendment to this Agreement. The determination of whether the Performance
Metrics have been met shall be determined in the reasonable discretion of the
Committee, following the applicable calendar year in which the Performance
Metrics are required to be met, no later than 90 days after (a) December 31,
2020, in connection with the 2020 Performance Metrics; and (b) the end of such
calendar year for subsequent years, and the Performance Bonus shall be payable
only after the Committee has affirmatively determined, in its reasonable
discretion, that such applicable Performance Metrics have been met. For the year
ended December 31, 2020, the Executive shall be awarded 49,020 shares of
restricted common stock (the “2020 Restricted Stock”) which shall vest at such
time as the Committee has affirmatively determined that the Performance Metrics
have been met, in the percentages set forth in the 2020 Performance Metrics, if
at all, and be subject to forfeiture if not vested pursuant to Exhibit C, and be
subject to the terms and conditions of the restricted stock award agreement in
the form of Exhibit C hereto and the Company’s 2019 Equity Incentive Plan (as
amended).

 

2.4. Business Expenses. So long as this Agreement is in effect, the Company
shall reimburse Executive for all reasonable, out-of-pocket business expenses
incurred in the performance of his duties hereunder consistent with the
Company’s policies and procedures, in effect from time to time, with respect to
travel, entertainment, communications, technology/equipment and other business
expenses customarily reimbursed to senior executives of the Company in
connection with the performance of their duties on behalf of the Company.

 

2.5. Vacation. Executive will be entitled to twenty days of paid time-off
(“PTO”) per year. PTO days shall accrue beginning on the 1st of January for each
year during the term of this Agreement. Unused PTO days shall roll over into the
next year. Other than the use of PTO days for illness or personal emergencies,
PTO days must be pre-approved by the Company.

 

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2.6. Other Benefits. During the Term, the Executive shall be entitled to
participate in any employee benefit plans or programs for which he is eligible
that are provided by the Company to its management employees, such as
retirement, health, life insurance, and disability plans, vacation and sick
leave policies, business expense reimbursement policies that the Company has in
effect from time to time, and stock option plan, life, health, accident,
disability insurance plans, pension plans and retirement plans, in effect from
time to time (including, without limitation, any incentive program or
discretionary bonus program of the Company which may be implemented in the
future by the Board), to the extent and on such terms and conditions as the
Company customarily makes such plans available to its senior executives. The
Company retains the right to terminate or alter the terms of any benefit
programs that it may establish, provided that no such termination or alteration
shall adversely affect any vested benefit under any benefit program. The Company
further retains the right to offer specific benefits to one or more executives
of the Company, including the Executive, but to not offer such benefits to other
executives of the Company, in the event such benefits are not customarily made
available to substantially all of is senior executives. For example only, the
Company may, in its sole discretion, offer the Executive keyman or disability
insurance as the Chief Executive Officer of the Company, which benefits may not
be offered to other senior management and/or executive officers of the Company.

 

2.7. Withholding. The Company may deduct from any compensation payable to
Executive (including payments made pursuant to this ARTICLE II or in connection
with the termination of employment pursuant to ARTICLE III of this Agreement)
amounts sufficient to cover Executive’s share of applicable federal, state
and/or local income tax withholding, social security payments, state disability
and other insurance premiums and payments.

 

2.8. Car Allowance. The Company shall provide the Executive an automobile
allowance of $1,000 per month during the term of Executive’s employment
hereunder.

 

ARTICLE III.

TERMINATION OF EMPLOYMENT

 

3.1. Termination of Employment. Executive’s employment pursuant to this
Agreement shall terminate on the earliest to occur of the following:

 

3.1.1 upon the death of Executive;

 

3.1.2 upon the delivery to Executive of written notice of termination by the
Company if Executive shall suffer a physical or mental disability which renders
Executive, in the reasonable judgment of the Board, unable to perform his duties
and obligations under this Agreement for either 90 consecutive days or 180 days
in any 12-month period;

 

3.1.3 upon the expiration of the Initial Term, unless a notice of termination
pursuant to Section 1.1 is not given by either Party, in which case upon the
expiration of the first Automatic Renewal Term that such a notice of termination
is given with respect to either Party (if any);

 

3.1.4 upon delivery to the Company of written notice of termination by Executive
for any reason other than for Good Reason;

 

3.1.5 upon delivery to Executive of written notice of termination by the Company
for Cause;

 

3.1.6 upon delivery of written notice of termination from Executive to the
Company for Good Reason, provided, however, prior to any such termination by
Executive pursuant to this Section 3.1.6, Executive shall have advised the
Company in writing within fifteen (15) days of the occurrence of any
circumstances that would constitute Good Reason, and the Company has not cured
such circumstances within 15 days following receipt of Executive’s written
notice, with the exception of only five (5) days written notice in the event the
Company reduces Executive’s salary without Executive’s consent or fails to pay
Executive any compensation due him; or

 

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3.1.7 upon delivery to Executive of written notice of termination by the Company
without Cause.

 

3.2. Termination in Connection with a Change of Control. In the event that
Executive’s employment is terminated for any reason (not including, however, a
termination by the Company for Cause (Section 3.1.5) or a termination as a
result of the Executive’s death (Section 3.1.1) or disability (Section
3.1.2)(and for clarity, which shall include termination by Executive for Good
Reason (Section 3.1.6)))(a “Change of Control Termination”) during the twelve
month period following a Change of Control (as defined in Section 3.3) or in
anticipation of a Change of Control, the Company shall pay Executive, within 60
days following the later of (i) the date of such Change of Control Termination;
and (ii) the date of such Change of Control, a cash severance payment in a lump
sum in an amount equal to 3.0 times the sum of (a) the current annual Base
Salary of the Executive; and (b) the amount of the most recent Discretionary
Bonus and Performance Bonus paid to the Executive pursuant to Section 2.2 and
Section 2.3 of this Agreement less applicable withholding (the “Change of
Control Payment”), which amount shall be payable within 60 days of the later of
(i) the date of such Change of Control Termination; and (ii) the date of such
Change of Control. If Executive’s employment ends due to a Change of Control
Termination within six (6) months prior to a Change of Control, it will be
deemed to be “in anticipation of a Change of Control” for purposes of this
paragraph. In addition, in the event of a Change of Control, all of Executive’s
equity-based compensation, if any, shall immediately vest regardless of whether
the Executive is retained by the Company or successor following the Change of
Control and any outstanding stock options held by the Executive shall be able to
be exercised by the Executive until the earlier of (A) one (1) year from the
date of termination and (B) the latest date upon which such stock options would
have expired by their original terms under any circumstances, provided that if
Executive’s employment ends in anticipation of a Change of Control and such
equity-based compensation awards or stock options have previously expired
pursuant to their terms, the Company shall pay the Executive a lump sum payment,
payable on the same date as the Change of Control Payment, equal to the black
scholes value of the expired and unexercised equity compensation awards and
stock options held by the Executive on the date of termination, based on the
value of such awards had they been exercisable through the end of their stated
term and had not previously expired.

 

3.3. Certain Definitions. For purposes of this Agreement, the following terms
shall have the following meanings:

 

3.3.1 “Cause” shall mean, in the context of a basis for termination by the
Company of Executive’s employment with the Company, that:

 

(i) Executive materially breaches any obligation, duty, covenant or agreement
under this Agreement, which breach is not cured or corrected within thirty (30)
days of written notice thereof from the Company (except for breaches of Section
1.3 and ARTICLE IV of this Agreement, which cannot be cured and for which the
Company need not give any opportunity to cure); or

 

(ii) Executive commits any act of misappropriation of funds or embezzlement; or

 

(iii) Executive commits any act of fraud; or

 

(iv) Executive is indicted of, or pleads guilty or nolo contendere with respect
to, theft, fraud, a crime involving moral turpitude, or a felony under federal
or applicable state law.

 

3.3.2 “Change of Control” shall mean the happening of any of the following not
approved in writing by the Executive:

 

(i) Any “Person” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act is or becomes the “Beneficial Owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
representing more than 50% of the total voting power represented by the
Company’s then outstanding voting securities without the approval of not fewer
than two-thirds of the Board of Directors of the Company voting on such matter,
unless the Board of Directors specifically designates such acquisition to be a
change of control;

 

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(ii) A merger or consolidation of the Company whether or not approved by the
Board of Directors of the Company, other than a merger or consolidation that
would result in the voting securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted or into voting securities of the surviving entity) at least 50%
of the total voting power represented by the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company’s assets; or

 

(iii) As a result of the election of members to the Board of Directors, a
majority of the Board of Directors consists of persons who are not members of
the Board of Directors as of the Effective Date (including Executive as a member
of the Board of Directors as of the Effective Date), except in the event that
such slate of directors is proposed by the Board or the nominating committee of
the Board.

 

(iv) Notwithstanding the foregoing, if the definition of “Change of Control” in
the Company’s Stock Incentive Plans or Equity Compensation Plans (each as
amended from time to time) is more favorable to the Executive, then such
definition shall be controlling for purposes of this Agreement.

 

3.3.3 “Good Reason” shall mean, in the context of a basis for termination by
Executive of his employment with the Company (a) without Executive’s consent,
his position or duties are modified by the Company to such an extent that his
duties are no longer consistent with the position of CEO of the Company, (b)
there has been a material breach by the Company of a material term of this
Agreement or Employee reasonably believes that the Company is violating any law
which would have a material adverse effect on the Company’s operations and such
violation continues uncured following thirty (30) days after such breach and
after notice thereof has been provided to the Company by the Executive, (c)
Executive’s compensation as set forth hereunder is reduced without Executive’s
consent, or the Company fails to pay to Executive any compensation due to him
hereunder upon five (5) days written notice from Executive informing the Company
of such failure, or (d) Executive, if Executive is also then serving as a member
of the Board, is not re-nominated by the Board to serve as a member of the Board
at any annual meeting of shareholders of the Company.

 

3.3.4 “Termination Date” shall mean the date on which Executive’s employment
with the Company hereunder is terminated.

 

3.4. Effect of Termination. In the event that Executive’s employment hereunder
is terminated in accordance with the provisions of this Agreement, Executive
shall be entitled to the following:

 

3.4.1 If Executive’s employment is terminated pursuant to Sections 3.1.1
(death), Section 3.1.2 (disability), Section 3.1.3 (the end of the Initial Term
if either Party has timely delivered a Non-Renewal Notice as provided in Section
1.1 or the end of any Automatic Renewal Term pursuant to which either Party has
timely delivered a Non-Renewal Notice as provided in Section 1.1), Section 3.1.4
(without Good Reason by the Executive), or Section 3.1.5 (by the Company for
Cause), Executive shall be entitled to salary accrued through the Termination
Date and no other benefits other than as required under the terms of employee
benefit plans in which Executive was participating as of the Termination Date.
Additionally, any unvested stock options or equity compensation held by
Executive shall immediately terminate and be forfeited (unless otherwise
provided in the applicable award) and any previously vested stock options (or if
applicable equity compensation) shall be subject to terms and conditions set
forth in the applicable Stock Incentive Plan or Equity Compensation Plan, or
award agreement, as such may describe the rights and obligations upon
termination of employment of Executive.

 

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3.4.2 If Executive’s employment is terminated by Executive pursuant to Section
3.1.6 (Good Reason), or pursuant to Section 3.1.7 (without Cause by the
Company), (a) Executive shall be entitled to continue to receive the salary at
the rate in effect upon the Termination Date of employment for eighteen (18)
months following the Termination Date, payable in accordance with the Company’s
normal payroll practices and policies, as if Executive’s employment had not
terminated; (b) Executive shall be entitled to the pro rata amount of any
Discretionary Bonus and Performance Bonus which would be payable to Executive
had he remained employed for an additional eighteen (18) months following the
Termination Date (with any components of the Discretionary Bonus or Performance
Bonus calculation being extrapolated based on the last four (4) full prior
quarters of the Company’s operations prior to termination); and (c) provided
Executive elects to receive continued health insurance coverage through COBRA,
the Company will pay Executive’s monthly COBRA contributions for health
insurance coverage, as may be amended from time to time (less an amount equal to
the premium contribution paid by active Company employees, if any) for eighteen
months (18) following the Termination Date; provided, however, that if at any
time Executive is covered by a substantially similar level of health insurance
through subsequent employment or otherwise, the Company’s health benefit
obligations shall immediately cease, and the Company shall have no further
obligation to make COBRA contributions on Executive’s behalf. Additionally,
unvested benefits (whether equity or cash benefits and bonuses (subject to this
Section 3.4.2 in connection with the Discretionary Bonus and Performance Bonus))
will vest immediately upon such termination and any outstanding stock options
previously granted to the Executive will vest immediately upon such termination
and shall be exercisable by the Executive until the earlier of (A) one (1) year
from the date of termination and (B) the latest date upon which such stock
options would have expired by their original terms under any circumstances.
Additionally, all restricted stock awards granted to Executive shall vest
immediately. Executive shall be entitled to no other post-employment benefits
except as provided for under this Section 3.4.2 and for benefits payable under
applicable benefit plans in which Executive is entitled to participate pursuant
to Section 2.6 hereof through the Termination Date, subject to and in accordance
with the terms of such plans.

 

3.4.3 As a condition to Executive’s right to receive any benefits pursuant to
Section 3.4.2 of this Agreement, (A) Executive must execute and deliver to the
Company a written release in form and substance reasonably satisfactory to the
Company, of any and all claims against the Company and all directors and
officers of the Company with respect to all matters arising out of Executive’s
employment hereunder, or the termination thereof (other than claims for
entitlements under the terms of this Agreement or plans or programs of the
Company in which Executive has accrued a benefit); and (B) Executive must not
breach any of his covenants and agreements under Section 1.3 and ARTICLE IV of
this Agreement, which shall continue following the Termination Date.

 

3.4.4 In the event of termination of Executive’s employment pursuant to Section
3.1.5 (by the Company for Cause), and subject to applicable law and regulations,
the Company shall be entitled to offset against any payments due Executive the
loss and damage, if any, which shall have been suffered by the Company as a
result of the acts or omissions of Executive giving rise to termination. The
foregoing shall not be construed to limit any cause of action, claim or other
rights, which the Company may have against Executive in connection with such
acts or omissions.

 

3.4.5 Upon termination of Executive’s employment hereunder, or on demand by the
Company during the term of this Agreement, Executive will immediately deliver to
the Company, and will not keep in his possession, recreate or deliver to anyone
else, any and all Company property, as well as all devices and equipment
belonging to the Company (including computers, handheld electronic devices,
telephone equipment, and other electronic devices), Company credit cards,
records, data, notes, notebooks, reports, files, proposals, lists,
correspondence, specifications, drawings blueprints, sketches, materials,
photographs, charts, all documents and property, and reproductions of any of the
aforementioned items that were developed by Executive pursuant to his employment
with the Company, obtained by Executive in connection with his employment with
the Company, or otherwise belonging to the Company, its successors or assigns,
including, without limitation, those records maintained pursuant to this
Agreement.

 

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3.4.6 Executive also agrees to keep the Company advised of his home and business
address for a period of two (2) years after termination of Executive’s
employment hereunder, so that the Company can contact Executive regarding his
continuing obligations provided by this Agreement. In the event that Executive’s
employment hereunder is terminated, Executive agrees to grant consent to
notification by the Company to Executive’s new employer about his obligations
under this Agreement.

 

3.4.7 Consulting. During the sixty day period following any termination of this
Agreement pursuant to Section 3.1.3, Section 3.1.4, Section 3.1.6, or Section
3.1.7, Executive shall be available, subject to his other reasonable commitments
or obligations made or incurred in mitigation of the termination of his
employment, by telephone, email or fax, as a consultant to the Company, without
further compensation, to consult with its officers and directors regarding
projects and/or tasks as defined by the Board.

 

3.4.8 Resignation as Director. Upon Executive’s termination of employment for
any reason, Executive agrees to resign as a member of the Board, if Executive is
a director at the time of termination, and to resign from any and all other
offices and positions related to Executive’s employment with the Company and its
subsidiaries and held by Executive at the time of termination.

 

ARTICLE IV.

INVENTIONS; CONFIDENTIAL/TRADE SECRET INFORMATION

AND RESTRICTIVE COVENANTS

 

4.1. Inventions. All processes, technologies and inventions relating to the
business of the Company (collectively, “Inventions”), including new
contributions, improvements, ideas, discoveries, trademarks and trade names,
conceived, developed, invented, made or found by Executive, alone or with
others, during his employment by the Company, whether or not patentable and
whether or not conceived, developed, invented, made or found on the Company’s
time or with the use of the Company’s facilities or materials, shall be the
property of the Company and shall be promptly and fully disclosed by Executive
to the Company. Executive shall perform all necessary acts (including, without
limitation, executing and delivering any confirmatory assignments, documents or
instruments requested by the Company) to assign or otherwise to vest title to
any such Inventions in the Company and to enable the Company, at its sole
expense, to secure and maintain domestic and/or foreign patents or any other
rights for such Inventions.

 

4.2. Confidential/Trade Secret Information/Non-Disclosure.

 

4.2.1 Confidential/Trade Secret Information Defined. During the course of
Executive’s employment, Executive will have access to various Confidential/Trade
Secret Information of the Company and information developed for the Company. For
purposes of this Agreement, the term “Confidential/Trade Secret Information” is
information that is not generally known to the public and, as a result, is of
economic benefit to the Company in the conduct of its business, and the business
of the Company’s subsidiaries. Executive and the Company agree that the term
“Confidential/Trade Secret Information” includes but is not limited to all
information developed or obtained by the Company, including its affiliates, and
predecessors, and comprising the following items, whether or not such items have
been reduced to tangible form (e.g., physical writing, computer hard drive,
disk, tape, e-mail, etc.): all methods, techniques, processes, ideas, research
and development, product designs, engineering designs, plans, models, production
plans, business plans, add-on features, trade names, service marks, slogans,
forms, pricing structures, business forms, marketing programs and plans, layouts
and designs, financial structures, operational methods and tactics, cost
information, the identity of and/or contractual arrangements with customers,
partners, suppliers and/or vendors, accounting procedures, and any document,
record or other information of the Company relating to the above.
Confidential/Trade Secret Information includes not only information directly
belonging to the Company which existed before the date of this Agreement and the
Prior Agreement, but also information developed by Executive for the Company,
including its subsidiaries, affiliates and predecessors, during the term of
Executive’s employment with the Company. Confidential/Trade Secret Information
does not include any information which (a) was in the lawful and unrestricted
possession of Executive prior to its disclosure to Executive by the Company, its
subsidiaries, affiliates or predecessors, (b) is or becomes generally available
to the public by lawful acts other than those of Executive after receiving it,
or (c) has been received lawfully and in good faith by Executive from a third
party who is not and has never been an executive of the Company, its
subsidiaries, affiliates or predecessors, and who did not derive it from the
Company, its subsidiaries, affiliates or predecessors.

 

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4.2.2 Restriction on Use of Confidential/Trade Secret Information. Executive
agrees that his use of Confidential/Trade Secret Information is subject to the
following restrictions for an indefinite period of time so long as the
Confidential/Trade Secret Information has not become generally known to the
public:

 

(i) Non-Disclosure. Executive agrees that he will not publish or disclose, or
allow to be published or disclosed, Confidential/Trade Secret Information to any
person without the prior written authorization of the Company unless pursuant to
or in connection with Executive’s job duties to the Company under this
Agreement; and

 

(ii) Non-Removal/Surrender. Executive agrees that he will not remove any
Confidential/Trade Secret Information from the offices of the Company or the
premises of any facility in which the Company is performing services, except
pursuant to his duties under this Agreement. Executive further agrees that he
shall surrender to the Company all documents and materials in his possession or
control which contain Confidential/Trade Secret Information and which are the
property of the Company upon the termination of his employment with the Company,
and that he shall not thereafter retain any copies of any such materials.

 

4.2.3 Prohibition Against Unfair Competition/ Non-Solicitation of Customers.
Executive agrees that at no time after his employment with the Company will he
engage in competition with the Company while making any use of the
Confidential/Trade Secret Information, or otherwise exploit or make use of the
Confidential/Trade Secret Information. Executive agrees that during the
twelve-month period following the Termination Date, he will not directly or
indirectly accept or solicit, in any capacity, the business of any customer of
the Company with whom Executive worked or otherwise had access to the
Confidential/Trade Secret Information pertaining to the Company’s business with
such customer during the last year of Executive’s employment with the Company,
or solicit, directly or indirectly, or encourage any of the Company’s customers
or suppliers to terminate their business relationship with the Company, or
otherwise interfere with such business relationships.

 

4.3. Non-Solicitation of Employees. Executive agrees that during the
twelve-month period following the Termination Date, he shall not, directly or
indirectly, solicit or otherwise encourage any employees of the Company to leave
the employ of the Company, or solicit, directly or indirectly, any of the
Company’s employees for employment.

 

4.4. Non-Solicitation During Employment. During his employment with the Company,
Executive shall not: (a) interfere with the Company’s business relationship with
its customers or suppliers, (b) solicit, directly or indirectly, or otherwise
encourage any of the Company’s customers or suppliers to terminate their
business relationship with the Company, or (c) solicit, directly or indirectly,
or otherwise encourage any employees of the Company to leave the employ of the
Company, or solicit any of the Company’s employees for employment.

 

4.5. Conflict of Interest. During Executive’s employment with the Company,
Executive must not engage in any work, paid or unpaid, that creates an actual
conflict of interest with the Company. If the Company or the Executive have any
question as to the actual or apparent potential for a conflict of interest,
either shall raise the issue formally to the other, and if appropriate and
necessary the issue shall be put to the independent members of the Board of the
Company or the Audit Committee (as defined by the Board) for consideration and
approval or non-approval, which approval or non-approval the Executive agrees
shall be binding on the Executive.

 

4.6. Breach of Provisions. If Executive materially breaches any of the
provisions of this ARTICLE IV or in the event that any such breach is threatened
by Executive, in addition to and without limiting or waiving any other remedies
available to the Company at law or in equity, the Company shall be entitled to
immediate injunctive relief in any court, domestic or foreign, having the
capacity to grant such relief, to restrain any such breach or threatened breach
and to enforce the provisions of this ARTICLE IV.

 

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4.7. Reasonable Restrictions. The Parties acknowledge that the foregoing
restrictions, as well as the duration and the territorial scope thereof as set
forth in this ARTICLE IV, are under all of the circumstances reasonable and
necessary for the protection of the Company and its business.

 

4.8. Specific Performance. Executive acknowledges and agrees that the Company’s
remedies at law for a breach or threatened breach of any of the provisions of
Section 1.3, Section 4.2, Section 4.3 or Section 4.4 hereof would be inadequate
and, in recognition of this fact, Executive agrees that, in the event of such a
breach or threatened breach, in addition to any remedies at law, the Company,
without posting any bond, shall be entitled to obtain equitable relief in the
form of specific performance, temporary restraining order, temporary or
permanent injunction or any other equitable remedy which may then be available.

 

ARTICLE V.

INDEMNIFICATION

 

5.1. The Company agrees to indemnify Executive and hold Executive harmless from
and against any and all losses, claims, damages, liabilities and costs (and all
actions in respect thereof and any legal or other expenses in giving testimony
or furnishing documents in response to a subpoena or otherwise), including,
without limitation, the costs of investigating, preparing or defending any such
action or claim, whether or not in connection with litigation in which Executive
is a party, as and when incurred, directly or indirectly caused by, relating to,
based upon or arising out of any work performed by Executive in connection with
this Agreement to the full extent permitted by Delaware General Corporation Law,
and by the Certificate of Incorporation and Bylaws of the Company, as may be
amended from time to time, and pursuant to any indemnification agreement between
Executive and the Company.

 

5.2. The indemnification provision of this ARTICLE V shall be in addition to any
liability which the Company may otherwise have to Executive.

 

5.3. If any action, proceeding or investigation is commenced as to which
Executive proposes to demand such indemnification, Executive shall notify the
Company with reasonable promptness. Executive shall have the right to retain
counsel of Executive’s own choice to represent Executive and the Company shall
pay all reasonable fees and expenses of such counsel; and such counsel shall, to
the fullest extent consistent with such counsel’s professional responsibilities,
cooperate with the Company and any counsel designated by the Company. The
Company shall be liable for any settlement of any claim against Executive made
with the Company’s written consent, which consent shall not be unreasonably
withheld or delayed, to the fullest extent permitted by Delaware General
Corporation Law and the Certificate of Incorporation and Bylaws of the Company,
as may be amended from time to time.

 

ARTICLE VI.

ARBITRATION

 

6.1. Scope. To the fullest extent permitted by law, Executive and the Company
agree to the binding arbitration of any and all controversies, claims or
disputes between them arising out of or in any way related to this Agreement,
the employment relationship between the Company and Executive and any disputes
upon termination of employment, including but not limited to breach of contract,
tort, discrimination, harassment, wrongful termination, demotion, discipline,
failure to accommodate, family and medical leave, compensation or benefits
claims, constitutional claims; and any claims for violation of any local, state
or federal law, statute, regulation or ordinance or common law. For the purpose
of this agreement to arbitrate, references to “Company” include all subsidiaries
or related entities and their respective executives, supervisors, officers,
directors, agents, pension or benefit plans, pension or benefit plan sponsors,
fiduciaries, administrators, affiliates and all successors and assigns of any of
them, and this agreement to arbitrate shall apply to them to the extent
Executive’s claims arise out of or relate to their actions on behalf of the
Company.

 

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6.2. Arbitration Procedure. To commence any such arbitration proceeding, the
Party commencing the arbitration must provide the other Party with written
notice of any and all claims forming the basis of such right in sufficient
detail to inform the other Party of the substance of such claims. In no event
shall this notice for arbitration be made after the date when institution of
legal or equitable proceedings based on such claims would be barred by the
applicable statute of limitations. The arbitration will be conducted in Tampa,
Florida, by a single neutral arbitrator and in accordance with the then-current
rules for resolution of employment disputes of the American Arbitration
Association (“AAA”). The Arbitrator is to be selected by the mutual agreement of
the Parties. If the Parties cannot agree, the AAA will select the arbitrator.
The Parties are entitled to representation by an attorney or other
representative of their choosing. The arbitrator shall have the power to enter
any award that could be entered by a judge of the trial court of the State of
Florida, and only such power, and shall follow the law. The award shall be
binding and the Parties agree to abide by and perform any award rendered by the
arbitrator. The arbitrator shall issue the award in writing and therein state
the essential findings and conclusions on which the award is based. Judgment on
the award may be entered in any court having jurisdiction thereof. The losing
Party in the arbitration hearing shall bear the costs of the arbitration filing
and hearing fees and the cost of the arbitrator.

 

ARTICLE VII.

MISCELLANEOUS

 

7.1. Successors and Assigns. This Agreement shall be binding upon any successor
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company’s business and/or assets. Any such successor will within a reasonable
period of becoming the successor assume in writing and be bound by all of the
Company’s obligations under this Agreement. For all purposes under this
Agreement, the term “Company” shall include any successor to the Company’s
business or assets that becomes bound by this Agreement. Executive may not
assign any of his rights or obligations under this Agreement.

 

7.2. Notices. Any notice provided for herein shall be in writing and shall be
deemed to have been given or made (a) when personally delivered or (b) when sent
by telecopier and confirmed within 48 hours by letter mailed or delivered to the
Party to be notified at its or his address set forth herein; or three (3) days
after being sent by registered or certified mail, return receipt requested (or
by equivalent currier with delivery documentation such as FEDEX or UPS) to the
address of the other Party set forth or to such other address as may be
specified by notice given in accordance with this Section 7.2:

 

If to the Company: Trxade Group, Inc.   3840 Land O’ Lakes Blvd   Land O’ Lakes,
Florida 34639   Telephone: 800-261-0281   Attention: Chief Financial Officer

 

If to the Executive: Suren Ajjarapu   (Address and contact information on file)

 

7.3. Severability. If any provision of this Agreement, or portion thereof, shall
be held invalid or unenforceable by a court of competent jurisdiction, such
invalidity or unenforceability shall attach only to such provision or portion
thereof, and shall not in any manner affect or render invalid or unenforceable
any other provision of this Agreement or portion thereof, and this Agreement
shall be carried out as if any such invalid or unenforceable provision or
portion thereof were not contained herein. In addition, any such invalid or
unenforceable provision or portion thereof shall be deemed, without further
action on the part of the Parties hereto, modified, amended or limited to the
extent necessary to render the same valid and enforceable.

 

7.4. Waiver. No waiver by a Party of a breach or default hereunder by the other
Party shall be considered valid, unless expressed in a writing signed by such
first Party, and no such waiver shall be deemed a waiver of any subsequent
breach or default of the same or any other nature.

 

7.5. Entire Agreement. This Agreement sets forth the entire agreement between
the Parties with respect to the subject matter hereof, and supersedes any and
all prior agreements between the Company and Executive, whether written or oral,
relating to any or all matters covered by and contained or otherwise dealt with
in this Agreement, including, but not limited to the Prior Agreement, which
shall be deemed terminated upon the Parties entry into this Agreement. This
Agreement does not constitute a commitment of the Company with regard to
Executive’s employment, express or implied, other than to the extent expressly
provided for herein.

 

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7.6. Amendment. No modification, change or amendment of this Agreement or any of
its provisions shall be valid, unless in a writing signed by the Parties and
approved by the Board.

 

7.7. Authority. The Parties each represent and warrant that it/he has the power,
authority and right to enter into this Agreement and to carry out and perform
the terms, covenants and conditions hereof.

 

7.8. Attorneys’ Fees. If either Party hereto commences an arbitration or other
action against the other Party to enforce any of the terms hereof or because of
the breach by such other Party of any of the terms hereof, the prevailing Party
shall be entitled, in addition to any other relief granted, to all actual
out-of-pocket costs and expenses incurred by such prevailing Party in connection
with such action, including, without limitation, all reasonable attorneys’ fees,
and a right to such costs and expenses shall be deemed to have accrued upon the
commencement of such action and shall be enforceable whether or not such action
is prosecuted to judgment.

 

7.9. Construction. When used in this Agreement, unless a contrary intention
appears: (i) a term has the meaning assigned to it; (ii) “or” is not exclusive;
(iii) “including” means including without limitation; (iv) words in the singular
include the plural and words in the plural include the singular, and words
importing the masculine gender include the feminine and neuter genders; (v) any
agreement, instrument or statute defined or referred to herein or in any
instrument or certificate delivered in connection herewith means such agreement,
instrument or statute as from time to time amended, modified or supplemented and
includes (in the case of agreements or instruments) references to all
attachments thereto and instruments incorporated therein; (vi) the words
“hereof”, “herein” and “hereunder” and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision hereof; (vii) references contained herein to Article, Section,
Schedule and Exhibit, as applicable, are references to Articles, Sections,
Schedules and Exhibits in this Agreement unless otherwise specified; (viii)
references to “writing” include printing, typing, lithography and other means of
reproducing words in a visible form, including, but not limited to email; (ix)
references to “dollars”, “Dollars” or “$” in this Agreement shall mean United
States dollars; (x) reference to a particular statute, regulation or Law means
such statute, regulation or Law as amended or otherwise modified from time to
time; (xi) any definition of or reference to any agreement, instrument or other
document herein shall be construed as referring to such agreement, instrument or
other document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein); (xii) unless otherwise stated in this Agreement, in the
computation of a period of time from a specified date to a later specified date,
the word “from” means “from and including” and the words “to” and “until” each
mean “to but excluding”; (xiii) references to “days” shall mean calendar days;
and (xiv) the paragraph headings contained in this Agreement are for convenience
only, and shall in no manner be construed as part of this Agreement.

 

7.10. Governing Law. This Agreement, and all of the rights and obligations of
the Parties in connection with the employment relationship established hereby,
shall be governed by and construed in accordance with the substantive laws of
the State of Florida without giving effect to principles relating to conflicts
of law.

 

7.11. Survival. The termination of Executive’s employment with the Company
pursuant to the provisions of this Agreement shall not affect Executive’s
obligations to the Company hereunder which by the nature thereof are intended to
survive any such termination, including, without limitation, Executive’s
obligations under Section 1.3 and ARTICLE IV of this Agreement.

 

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7.12. Section 280G Safe Harbor Cap. In the event it shall be determined that any
payment or distribution or any part thereof of any type to or for the benefit of
Executive whether pursuant to the Agreement or any other agreement between
Executive and the Company, or any person or entity that acquires ownership or
effective control the Company or ownership of a substantial portion of the
Company’s assets (within the meaning of Section 280G of the Internal Revenue
Code of 1986, as amended, and the regulations thereunder (the “Code”)) whether
paid or payable or distributed or distributable pursuant to the terms of the
Agreement or any other agreement, (the “Total Payments”), is or will be subject
to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then
the Total Payments shall be reduced to the maximum amount that could be paid to
Executive without giving rise to the Excise Tax (the “Safe Harbor Cap”), if the
net after-tax payment to Executive after reducing Executive’s Total Payments to
the Safe Harbor Cap is greater than the net after-tax (including the Excise Tax)
payment to Executive without such reduction. The reduction of the amounts
payable hereunder, if applicable, shall be made by reducing first the payment
made pursuant to the Agreement and then to any other agreement that triggers
such Excise Tax, unless an alternative method of reduction is elected by
Executive. All mathematical determinations, and all determinations as to whether
any of the Total Payments are “parachute payments” (within the meaning of
Section 280G of the Code), that are required to be made under ARTICLE III,
including determinations as to whether the Total Payments to Executive shall be
reduced to the Safe Harbor Cap and the assumptions to be utilized in arriving at
such determinations, shall be made by a nationally recognized accounting firm
selected by the Company (the “Accounting Firm”). If the Accounting Firm
determines that the Total Payments to Executive shall be reduced to the Safe
Harbor Cap (the “Cutback Payment”) and it is established pursuant to a final
determination of a court or an Internal Revenue Service (the “IRS”) proceeding
which has been finally and conclusively resolved, that the Cutback Payment is in
excess of the limitations provided in this Section 7.12 (hereinafter referred to
as an “Excess Payment”), such Excess Payment shall be deemed for all purposes to
be an overpayment to Executive made on the date such Executive received the
Excess Payment and Executive shall repay the Excess Payment to the Company on
demand; provided, however, if Executive shall be required to pay an Excise Tax
by reason of receiving such Excess Payment (regardless of the obligation to
repay the Company), Executive shall not be required to repay the Excess Payment
(if Executive has already repaid such amount, the Company shall refund the
amount to the Executive), and the Company shall pay Executive an amount equal to
the difference between the Total Payments and the Safe Harbor Cap (provided that
such amount has previously been repaid by the Executive or not previously paid
by the Company).

 

7.13. Section 409A and 457A Compliance. To the extent applicable, this Agreement
is intended to meet the requirements of Section 409A and 457A of the Code, and
shall be interpreted and construed consistent with that intent. For purposes of
this Agreement, each payment under this Agreement shall be considered a
“separate payment” and not as part of a series of payments for purposes of
Section 409A.

 

7.14. Clawback. Notwithstanding any provision in this Agreement to the contrary,
any portion of the payments and benefits provided under this Agreement, as well
as any other payments and benefits which the Executive receives pursuant to a
Company plan or other arrangement, shall be subject to a clawback to the extent
necessary to comply with the requirements of the Dodd-Frank Wall Street Reform
and Consumer Protection Act and/or any Securities and Exchange Commission rule.

 

7.15. Legal Counsel. Executive acknowledges and warrants that (A) he has been
advised that Executive’s interests may be different from the Company’s
interests, (B) he has been afforded a reasonable opportunity to review this
Agreement, to understand its terms and to discuss it with an attorney and/or
financial advisor of his choice and (C) he knowingly and voluntarily entered
into this Agreement. The Company and Executive shall each bear their own costs
and expenses in connection with the negotiation and execution of this Agreement.

 

7.16. Counterparts, Effect of Facsimile, Emailed and Photocopied Signatures.
This Agreement and any signed agreement or instrument entered into in connection
with this Agreement, and any amendments hereto or thereto, may be executed in
one or more counterparts, all of which shall constitute one and the same
instrument. Any such counterpart, to the extent delivered by means of a
facsimile machine or by .pdf, .tif, .gif, .jpeg or similar attachment to
electronic mail (any such delivery, an “Electronic Delivery”) shall be treated
in all manners and respects as an original executed counterpart and shall be
considered to have the same binding legal effect as if it were the original
signed version thereof delivered in person. At the request of any Party, each
other Party shall re execute the original form of this Agreement and deliver
such form to all other Parties. No Party shall raise the use of Electronic
Delivery to deliver a signature or the fact that any signature or agreement or
instrument was transmitted or communicated through the use of Electronic
Delivery as a defense to the formation of a contract, and each such Party
forever waives any such defense, except to the extent such defense relates to
lack of authenticity.

 

[Remainder of page left intentionally blank. Signature page follows]

 

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This Agreement contains provisions requiring binding arbitration of disputes. By
signing this Agreement, Executive acknowledges that he (i) has read and
understood the entire Agreement; (ii) has received a copy of it (iii) has had
the opportunity to ask questions and consult counsel or other advisors about its
terms; and (iv) agrees to be bound by it.

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
day and year first above written.

 

“COMPANY”       TRXADE GROUP, INC.   a Delaware corporation         By: /s/
Donald G. Fell   Name: Donald G. Fell   Title: Chairman of the Compensation
Committee of the Board of Directors       “EXECUTIVE”             /s/ Suren
Ajjarapu   Suren Ajjarapu

 

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EXHIBIT A

 

AT-WILL EMPLOYMENT, CONFIDENTIAL INFORMATION,
INVENTION ASSIGNMENT
AND ARBITRATION AGREEMENT

 

As a condition of my employment with Trxade Group, Inc., a Delaware corporation,
and/or any of its subsidiaries, affiliates, partners, successors or assigns
(together the “Company”), and in consideration of my employment with the
Company, ten dollars ($10) and other good and valuable consideration, which I
confirm receipt and sufficiency of, and my receipt of the compensation now and
hereafter paid to me by the Company, I (the “Employee”) agree to the following:

 

1. At-Will Employment.

 

I understand and acknowledge that, notwithstanding the terms of any employment
agreement or understanding between myself and the Company, my employment with
the Company constitutes “at-will” employment. I also understand that any
representation to the contrary is unauthorized and not valid unless obtained in
writing and signed by an authorized corporate representative of the Company. I
acknowledge that this employment relationship may be terminated at any time,
with or without good cause or for any or no cause, at the option either of the
Company or myself, with or without notice, pursuant to where applicable, the
terms and provisions of any employment agreement or understanding between myself
and the Company.

 

2. Confidential Information.

 

A. Company Information. I agree at all times during the term of my employment
and thereafter, to hold in strictest confidence, and not to use, except for the
benefit of the Company, or to disclose to any person, firm or corporation
without written authorization of the Board of Directors of the Company, any
Confidential Information of the Company, except under a non-disclosure agreement
duly authorized and executed by the Company. I understand that “Confidential
Information” means any non-public information that relates to the actual or
anticipated business or research and development of the Company, technical data,
trade secrets or know-how, including, but not limited to, research, product
plans or other information regarding the Company’s products or services and
markets therefor, customer lists and customers (including, but not limited to,
customers of the Company on whom I called or with whom I became acquainted
during the term of my employment), software, developments, inventions,
processes, formulas, technology, designs, drawings, engineering, hardware
configuration information, marketing, finances or other business information. I
further understand that Confidential Information does not include any of the
foregoing items which have become publicly known and made generally available
through no wrongful act of mine or of others who were under confidentiality
obligations as to the item or items involved or improvements or new versions
thereof.

 

B. Former Employer Information. I agree that I will not, during my employment
with the Company, improperly use or disclose any proprietary information or
trade secrets of any former or concurrent employer or other person or entity and
that I will not bring onto the premises of the Company any unpublished document
or proprietary information belonging to any such employer, person or entity
unless consented to in writing by such employer, person or entity.

 

C. Third Party Information. I recognize that the Company has received and in the
future will receive from third parties their confidential or proprietary
information subject to a duty on the Company’s part to maintain the
confidentiality of such information and to use it only for certain limited
purposes. I agree to hold all such confidential or proprietary information in
the strictest confidence and not to disclose it to any person, firm or
corporation or to use it except as necessary in carrying out my work for the
Company consistent with the Company’s agreement with such third party.

 

Page 1 of 5
AT-WILL EMPLOYMENT, CONFIDENTIAL INFORMATION,
INVENTION ASSIGNMENT, AND ARBITRATION AGREEMENT

 

 

3. Inventions.

 

A. Inventions Retained and Licensed. I have attached hereto, as Exhibit 1, a
list describing all inventions, original works of authorship, developments,
improvements, and trade secrets which were made by me prior to my employment
with the Company (collectively referred to as “Prior Inventions”), which belong
to me, which relate to the Company’s proposed business, products or research and
development, and which are not assigned to the Company hereunder; or, if no such
list is attached, I represent that there are no such Prior Inventions. If in the
course of my employment with the Company, I incorporate into a Company product,
process or service a Prior Invention owned by me or in which I have an interest,
I hereby grant to the Company a nonexclusive, royalty-free, fully paid-up,
irrevocable, perpetual, worldwide license to make, have made, modify, use and
sell such Prior Invention as part of or in connection with such product, process
or service, and to practice any method related thereto.

 

B. Assignment of Inventions. I agree that I will promptly make full written
disclosure to the Company, will hold in trust for the sole right and benefit of
the Company, and hereby assign to the Company, or its designee, all my right,
title, and interest in and to any and all inventions, original works of
authorship, developments, concepts, improvements, designs, discoveries, ideas,
trademarks or trade secrets, whether or not patentable or registrable under
copyright or similar laws, which I may solely or jointly conceive or develop or
reduce to practice, or cause to be conceived or developed or reduced to
practice, during the entire period of time I am in the employ of the Company
(whether before or after the execution of this Agreement) related to the
business of the Company (collectively referred to as “Inventions”). I further
acknowledge that all original works of authorship which are made by me (solely
or jointly with others) within the scope of and during the period of my
employment with the Company (whether before or after the execution of this
Agreement) and which are protectible by copyright are “works made for hire,” as
that term is defined in the United States Copyright Act. Employee understands
that this means that the Company will have the right to undertake any of the
actions set forth in Section 106 of the United States Copyright Act (17 U.S.C. §
106) with respect to such copyrightable works prepared by Employee within the
scope of Employee’s employment. Employee understands that this includes, without
limitation, the right to sell, license, use, reproduce and have reproduced,
create derivative works of, distribute, display, transmit and otherwise
commercially exploit such copyrightable works by all means without further
compensating the Employee. I understand and agree that the decision whether or
not to commercialize or market any invention developed by me solely or jointly
with others is within the Company’s sole discretion and for the Company’s sole
benefit and that no royalty will be due to me as a result of the Company’s
efforts to commercialize or market any such invention.

 

C. Assignment of Other Rights. In addition to the foregoing assignment of
Inventions to the Company, Employee hereby irrevocably transfers and assigns to
the Company: (i) all worldwide patents, patent applications, copyrights, mask
works, trade secrets and other intellectual property rights in any Assigned
Inventions; and (ii) any and all “Moral Rights” (as defined below) that Employee
may have in or with respect to any Inventions. Employee also hereby forever
waives and agrees never to assert any and all Moral Rights Employee may have in
or with respect to any Inventions, even after termination of Employee’s work on
behalf of the Company. “Moral Rights” means any rights to claim authorship of
any Inventions, to object to or prevent the modification of any Inventions, or
to withdraw from circulation or control the publication or distribution of any
Inventions, and any similar right, existing under judicial or statutory law of
any country in the world, or under any treaty, regardless of whether or not such
right is denominated or generally referred to as a “moral right”.

 

D. Inventions Assigned to the United States. I agree to assign to the United
States government all my right, title, and interest in and to any and all
Inventions whenever such full title is required to be in the United States by a
contract between the Company and the United States or any of its agencies.

 

E. Maintenance of Records. I agree to keep and maintain adequate and current
written records of all Inventions made by me (solely or jointly with others)
during the term of my employment with the Company. The records will be in the
form of notes, sketches, drawings, and any other format that may be specified by
the Company. The records will be available to and remain the sole property of
the Company at all times.

 

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AT-WILL EMPLOYMENT, CONFIDENTIAL INFORMATION,
INVENTION ASSIGNMENT, AND ARBITRATION AGREEMENT

 

 

F. Patent and Copyright Registrations. I agree to assist the Company, or its
designee, at the Company’s expense, in every proper way to secure the Company’s
rights in the Inventions and any copyrights, patents, mask work rights or other
intellectual property rights relating thereto in any and all countries,
including the disclosure to the Company of all pertinent information and data
with respect thereto, the execution of all applications, specifications, oaths,
assignments and all other instruments which the Company shall deem necessary in
order to apply for and obtain such rights and in order to assign and convey to
the Company, its successors, assigns, and nominees the sole and exclusive
rights, title and interest in and to such Inventions, and any copyrights,
patents, mask work rights or other intellectual property rights relating
thereto. I further agree that my obligation to execute or cause to be executed,
when it is in my power to do so, any such instrument or papers shall continue
after the termination of this Agreement. If the Company is unable because of my
mental or physical incapacity or for any other reason to secure my signature to
apply for or to pursue any application for any United States or foreign patents
or copyright registrations covering Inventions or original works of authorship
assigned to the Company as above, then I hereby irrevocably designate and
appoint the Company and its duly authorized officers and agents as my agent and
attorney in fact, to act for and on my behalf and stead to execute and file any
such applications and to do all other lawfully permitted acts to further the
prosecution and issuance of letters patent or copyright registrations thereon
with the same legal force and effect as if executed by me.

 

4. Conflicting Employment. I agree that, during the term of my employment with
the Company, I will not engage in any other employment, occupation or consulting
directly related to the business in which the Company is now involved or becomes
involved during the term of my employment, nor will I engage in any other
activities that conflict with my obligations to the Company.

 

5. Returning Company Documents. I agree that, at the time of leaving the employ
of the Company, I will deliver to the Company (and will not keep in my
possession, recreate or deliver to anyone else) any and all devices, records,
data, notes, reports, proposals, lists, correspondence, specifications,
drawings, blueprints, sketches, materials, equipment, other documents or
property, or reproductions of any aforementioned items developed by me pursuant
to my employment with the Company or otherwise belonging to the Company, its
successors or assigns, including, without limitation, those records maintained
pursuant to Section 3.E. In the event of the termination of my employment, I
agree to sign and deliver the “Termination Certification” attached hereto as
Exhibit 2.

 

6. Notification of New Employer. In the event that I leave the employ of the
Company, I hereby grant consent to notification by the Company to my new
employer about my rights and obligations under this Agreement.

 

7. Solicitation of Employees. I agree that for a period of twelve (12) months
immediately following the termination of my relationship with the Company for
any reason, whether with or without cause, I will not either directly or
indirectly solicit, induce, recruit or encourage any of the Company’s employees
to leave their employment or the Company’s customers to remove or reduce their
business with the Company, or take away such employees or customers, or attempt
to solicit, induce, recruit, encourage or take away employees or customers of
the Company, either for myself or for any other person or entity.

 

8. Conflict of Interest Guidelines. I agree to diligently adhere to the Conflict
of Interest Guidelines attached as Exhibit 3 hereto.

 

9. Representations. I agree to execute any proper oath or verify any proper
document required to carry out the terms of this Agreement. I represent that my
performance of all the terms of this Agreement will not breach any agreement to
keep in confidence proprietary information acquired by me in confidence or in
trust prior to my employment by the Company. I hereby represent and warrant that
I have not entered into, and I will not enter into, any oral or written
agreement in conflict herewith.

 

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AT-WILL EMPLOYMENT, CONFIDENTIAL INFORMATION,
INVENTION ASSIGNMENT, AND ARBITRATION AGREEMENT

 

 

10. Arbitration and Equitable Relief.

 

A. Arbitration. In consideration of my employment with the Company, its promise
to arbitrate all employment-related disputes and my receipt of the compensation,
pay raises and other benefits paid to me by the Company, at present and in the
future, I agree that any and all controversies, claims, or disputes with anyone
(including the Company and any employee, officer, director, stockholder or
benefit plan of the Company in their capacity as such or otherwise) arising out
of, relating to, or resulting from my employment with the Company or the
termination of my employment with the Company, including any breach of this
Agreement, will be subject to binding arbitration, to the fullest extent
permitted by law. Disputes which I agree to arbitrate, and thereby agree to
waive any right to a trial by jury, include any statutory claims under state or
federal law, including, but not limited to, claims under Title VII of the Civil
Rights Act of 1964, the Americans with Disabilities Act of 1990, the Age
Discrimination in Employment Act of 1967, the Older Workers Benefit Protection
Act, claims of harassment, discrimination or wrongful termination and any
statutory claims. I further understand that this agreement to arbitrate also
applies to any disputes that the Company may have with me.

 

B. Procedure. I agree that any arbitration will be administered by the American
Arbitration Association (“AAA”) and that the neutral arbitrator will be selected
in a manner consistent with its national rules for the resolution of employment
disputes. I agree that the arbitrator will have the power to decide any motions
brought by any party to the arbitration, including motions for summary judgment
and/or adjudication and motions to dismiss and demurrers, prior to any
arbitration hearing. I also agree that the arbitrator will have the power to
award any remedies, including attorneys’ fees and costs, available under
applicable law. I understand the Company will pay for any administrative or
hearing fees charged by the arbitrator or AAA except that I will pay the first
$200.00 of any filing fees associated with any arbitration I initiate. I agree
that the arbitrator will administer and conduct any arbitration in a manner
consistent with AAA’s national rules, to the extent that the AAA’s national
rules for the resolution of employment disputes do not conflict with applicable
law. I agree that the decision of the arbitrator will be in writing. Any
procedure for remedying disputes as set forth in any employment agreement or
understanding between myself and the Company shall supersede and take precedence
over the Procedure set forth in this Section 10.B.

 

C. Remedy. Except as provided by law and this Agreement (or provided for in any
employment agreement or understanding between myself and the Company),
arbitration will be the sole, exclusive and final remedy for any dispute between
me and the Company. Accordingly, except as provided for by law and this
Agreement, neither I nor the Company will be permitted to pursue court action
regarding claims that are subject to arbitration. Notwithstanding, the
arbitrator will not have the authority to disregard or refuse to enforce any
lawful Company policy, and the arbitrator will not order or require the Company
to adopt a policy not otherwise required by law which the Company has not
adopted.

 

D. Availability of Injunctive Relief. In addition to any right under applicable
law that the Company or I may have to petition a court of competent jurisdiction
for provisional relief, I agree that any party may also petition the arbitrator
for provisional injunctive relief where either party alleges or claims a
violation of the employment, confidential information, invention assignment
agreement between me and the Company or any other agreement regarding trade
secrets, confidential information, or non-solicitation. I understand that any
breach or threatened breach of such an agreement will cause irreparable injury
and that money damages will not provide an adequate remedy therefor and both
parties hereby consent to the issuance of an injunction. In the event either
party seeks injunctive relief, the prevailing party will be entitled to recover
reasonable costs and attorneys’ fees.

 

E. Administrative Relief. I understand that this Agreement does not prohibit me
from pursuing an administrative claim with a local, state or federal
administrative body. This Agreement does, however, preclude me from pursuing
court action regarding any such claim.

 

F. Voluntary Nature of Agreement. I acknowledge and agree that I am executing
this Agreement voluntarily and without any duress or undue influence by the
Company or anyone else. I further acknowledge and agree that I have carefully
read this Agreement and that I have asked any questions needed for me to
understand the terms, consequences and binding effect of this Agreement and
fully understand it, including that I AM WAIVING MY RIGHT TO A JURY TRIAL.
Finally, I agree that I have been provided an opportunity to seek the advice of
an attorney of my choice before signing this Agreement.

 

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AT-WILL EMPLOYMENT, CONFIDENTIAL INFORMATION,
INVENTION ASSIGNMENT, AND ARBITRATION AGREEMENT

 

 

11. General Provisions.

 

A. Governing Law, Consent to Personal Jurisdiction. This Agreement will be
governed by the laws of the State of Florida. I hereby expressly consent to the
personal jurisdiction of the state and federal courts located in Florida for any
lawsuit filed there against me by the Company arising from or relating to this
Agreement.

 

B. Entire Agreement. This Agreement, along with my offer letter of employment
(if any), employment agreement or understanding, sets forth the entire agreement
and understanding between the Company and me relating to the subject matter
herein and supersedes all prior discussions or representations between us
including, but not limited to, any representations made during my interview(s)
or relocation negotiations, whether written or oral. No modification of or
amendment to this Agreement, nor any waiver of any rights under this Agreement,
will be effective unless in writing signed by an authorized officer of the
Company (other than me) and me. Any subsequent change or changes in my duties,
salary or compensation will not affect the validity or scope of this Agreement.
This Agreement prevails and supersedes in the event there is any inconsistency
between this Agreement and any other offer letter, unless the offer letter
expressly provides otherwise. The terms of this Agreement shall supersede and
amend, effective as of the date hereof, any prior At Will Employment,
Confidential Information, Invention Assignment and Arbitration Agreement entered
into by the Employee in favor of the Company, provided that such prior At Will
Employment, Confidential Information, Invention Assignment and Arbitration
Agreement shall continue to bind the Employee and be enforceable by the Company
against the Employee for all actions, events, occurrences and other matters
between the date hereof through the date of this Agreement below. The terms of
any employment agreement or understanding between myself and the Company shall
prevail and supersede, where and to the extent applicable, in the event there is
any inconsistency between this Agreement and such employment agreement or
understanding, unless the employment agreement or understanding expressly
provides otherwise.

 

C. Severability. If one or more of the provisions in this Agreement are deemed
void by law, then the remaining provisions will continue in full force and
effect.

 

D. Successors and Assigns. This Agreement will be binding upon my heirs,
executors, administrators and other legal representatives and will be for the
benefit of the Company, its successors, and its assigns.

 

Date: 04/15/2020   /s/ Suren Ajjarapu       Signature               Suren
Ajjarapu       Name of Employee (typed or printed)

 

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AT-WILL EMPLOYMENT, CONFIDENTIAL INFORMATION,
INVENTION ASSIGNMENT, AND ARBITRATION AGREEMENT

 

 

EXHIBIT 1

 

LIST OF PRIOR INVENTIONS
AND ORIGINAL WORKS OF AUTHORSHIP

 

Title  Date  Identifying Number
or Brief Description        

 

___________ No inventions or improvements

 

___________ Additional Sheets Attached

 

Signature of Employee: /s/ Suren Ajjarapu   Print Name of Employee: Suren
Ajjarapu   Date:    

 

 

 

 

EXHIBIT 2

 

TERMINATION CERTIFICATION

 

This is to certify that I do not have in my possession, nor have I failed to
return, any devices, records, data, notes, reports, proposals, lists,
correspondence, specifications, drawings, blueprints, sketches, materials,
equipment, other documents or property, or reproductions of any aforementioned
items belonging to Trxade Group, Inc., a Delaware corporation, and/or its
subsidiaries, affiliates, partners, predecessors, successors or assigns
(together, the “Company”).

 

I further certify that I have complied with all the terms of the Company’s
At-Will Employment, Confidential Information, Invention Assignment and
Arbitration Agreement signed by me, including the reporting of any inventions
and original works of authorship (as defined therein), conceived or made by me
(solely or jointly with others) covered by that agreement.

 

I further agree that, in compliance with the At-Will Employment, Confidential
Information, Invention Assignment, and Arbitration Agreement, I will preserve as
confidential all trade secrets, confidential knowledge, data or other
proprietary information relating to products, processes, know-how, designs,
formulas, developmental or experimental work, computer programs, data bases,
other original works of authorship, customer lists, business plans, financial
information or other subject matter pertaining to any business of the Company or
any of its employees, clients, consultants or licensees.

 

I agree that for a period of twelve (12) months immediately following the
termination of my relationship with the Company for any reason, whether with or
without cause, I shall not either directly or indirectly solicit, induce,
recruit or encourage any of the Company’s employees to leave their employment or
customers to remove or reduce their business with, or take away such employees
or customers, or attempt to solicit, induce, recruit, encourage or take away
employees or customers of the Company, either for myself or for any other person
or entity.

 

Date:                             (Employee’s Signature)               Suren
Ajjarapu       (Type/Print Employee’s Name)

 

 

 

 

EXHIBIT 3

 

CONFLICT OF INTEREST GUIDELINES

 

It is the policy of Trxade Group, Inc., a Delaware corporation (the “Company”)
to conduct its affairs in strict compliance with the letter and spirit of the
law and to adhere to the highest principles of business ethics. Accordingly, all
officers, employees and independent contractors must avoid activities which are
in conflict, or give the appearance of being in conflict, with these principles
and with the interests of the Company. The following are potentially
compromising situations which must be avoided. Any exceptions must be reported
to an authorized officer of the Company (other than me) and written approval for
continuation must be obtained.

 

1. Revealing confidential information to outsiders or misusing confidential
information. Unauthorized divulging of information is a violation of this policy
whether or not for personal gain and whether or not harm to the Company is
intended. (The At-Will Employment, Confidential Information, Invention
Assignment and Arbitration Agreement elaborates on this principle and is
binding).

 

2. Accepting or offering substantial gifts, excessive entertainment, favors or
payments which may be deemed to constitute undue influence or otherwise be
improper or embarrassing to the Company.

 

3. Participating in civic or professional organizations that might involve
divulging confidential information of the Company.

 

4. Initiating or approving personnel actions affecting reward or punishment of
employees or applicants where there is a family relationship or is or appears to
be a personal or social involvement.

 

5. Initiating or approving any form of personal or social harassment of
employees.

 

6. Investing or holding outside directorship in suppliers, customers, or
competing companies, including financial speculations, where such investment or
directorship might influence in any manner a decision or course of action of the
Company.

 

7. Borrowing from or lending to employees, customers or suppliers.

 

8. Acquiring real estate of interest to the Company without the approval of the
Board of Directors.

 

9. Improperly using or disclosing to the Company any proprietary information or
trade secrets of any former or concurrent employer or other person or entity
with whom obligations of confidentiality exist.

 

10. Unlawfully discussing prices, costs, customers, sales or markets with
competing companies or their employees.

 

11. Making any unlawful agreement with distributors with respect to prices.

 

12. Improperly using or authorizing the use of any inventions which are the
subject of patent claims of any other person or entity.

 

13. Engaging in any conduct which is not in the best interest of the Company.

 

Each officer, employee and independent contractor must take every necessary
action to ensure compliance with these guidelines and to bring problem areas to
the attention of higher management for review. Violations of this conflict of
interest policy may result in discharge without warning.

 

 

 

 

EXHIBIT B

 

2020 Bonus Metrics

 

1. Revenue Goal: Hit $ 12.5 Million (50% of 2020 Restricted Stock shall vest)  
    2. Bonum Health Platform Reach 50,000 patients (30% of 2020 Restricted Stock
shall vest)       3. Place E-HUBS in 100 stores / locations (10% of 2020
Restricted Stock shall vest)       4. Trxade Group Net Operating Income 10% of
total sales (10% of 2020 Restricted Stock shall vest)