Exhibit 10.1

 

AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT

 

This AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT (the “Agreement”), is
made and entered into on May 31, 2019, effective as of April 15, 2019 (the
“Effective Date”), by and between HEALTH-RIGHT DISCOVERIES, INC., a Florida
corporation, (the “Company”) and DAVID HOPKINS, an individual (the “Executive”).

 

RECITALS

 

WHEREAS, the Company and the Executive have heretofore entered into an Executive
Employment Agreement, made and entered into on January 10, 2018, effective as of
January 1, 2018 (the “Original Employment Agreement”), pursuant to which the
Company employed the Executive; and

 

WHEREAS, in connection with the Company’s continued employment of the Executive,
the Company and the Executive wish to modify and amend certain terms of the
Executive’s employment by the Company and in connection therewith, restate the
Original Employment Agreement in its entirety by entering into this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties agree as follows:

 

1.          Recitals.          The above recitals are true and correct and are
incorporated herein by reference.

 

2.          Position and Duties.          The Executive shall serve as Chief
Executive Officer and President of the Company reporting to the Company’s board
of directors (the “Board”). The Executive shall perform those services customary
to that office and such other lawful duties that may be reasonably assigned to
him from time to time by the Board, provided those duties are consistent with
the Executive’s position and authority. The Executive further agrees to use his
best efforts to promote the interests of the Company and to devote his full
business time and energies to the business and affairs of the Company.

 

3.          Term.          The Company shall continue to employ the Executive
and the Executive shall continue to serve the Company, on the terms and
conditions set forth herein, for the period commencing on the Effective Date and
expiring on the third anniversary of the Effective Date, unless sooner
terminated as hereinafter set forth (the “Initial Term”). This Agreement shall
automatically renew for successive three (3) year periods (each, a “Renewal
Term,” and together with the Initial Term, the “Term”), provided that the
Company’s subsidiaries, CCI Billing, Inc., a Florida corporation and Script
Connection, LLC, a Florida limited liability company (collectively, the
“Subsidiaries”), achieve combined Adjusted EBITDA (as determined by the
Company’s accountants from the annual financial statements of the Subsidiaries
used in preparing the Company’s audited annual financial statements) of
$3,000,000 for any calendar year during the Initial Term and any Renewal Term.

 

3.          Compensation and Related Matters.

 

(a)                Base Salary.          The Executive’s annual base salary
shall be two hundred fifty thousand dollars ($250,000) (together with any
subsequent increases thereto as hereinafter provided, the “Base Salary”). In the
event in any calendar year during the Term, the Subsidiaries achieve combined
Adjusted EBITDA (as determined by the Company’s accountants from the annual
financial statements of the Subsidiaries used in preparing the Company’s audited
annual financial statements) of $3,000,000, the Executive’s annual Base Salary
shall automatically increase to $300,000 and in the event in any calendar year
during the Term, the Subsidiaries achieve combined Adjusted EBITDA (as
determined by the Company’s accountants from the annual financial statements of
the Subsidiaries used in preparing the Company’s audited annual financial
statements) of $3,500,000, the Executive’s annual Base Salary shall
automatically increase to $350,000. The Base Salary shall be payable in
accordance with the Company’s normal payroll procedures in effect from time to
time. In addition to the foregoing, the Base Salary may be increased by the
Board or its compensation committee (the “Committee”), if any, from time to time
during the Term, but shall be reviewed by the Board or the Committee, if any, at
least annually.

 

 

 

 

(b)          Annual Bonus.          During the Term, the Executive may be paid a
performance bonus to the extent earned, based on criteria established by the
Board or the Committee from time to time during the Term (the “Bonus”). The
amount of any Bonus and the performance criteria for earning the Bonus, if any
for any subsequent fiscal year shall be determined by the Board or the
Committee, in good faith, no later than sixty (60) days after the commencement
of the relevant fiscal year. The Executive’s Bonus for a bonus period shall be
determined by the Board or the Committee after the end of the applicable bonus
period and be paid to the Executive in the year following the year to which the
Bonus relates when annual bonuses for that year are paid to other senior
executives of the Company generally.

 

(c)          Car Allowance.        During the Term, the Executive shall be
entitled to receive a monthly car allowance of $600 (which may be increased by
the Board or the Committee in their sole discretion).

 

(d)          Bonus Plans.          The Executive shall be entitled to
participate in all bonus plans, policies, practices and programs adopted by the
Company and applicable generally to other senior executives of the Company, in
accordance with the terms of such plans (if any).

 

(e)          Business Expenses.          The Executive shall be entitled to
receive prompt reimbursement for all reasonable business expenses incurred by
him in performing services hereunder, in accordance with the policies and
procedures then in effect and established by the Company for its senior
executive officers.

 

(f)           Directors’ and Officers’ Liability Insurance.          the
Effective Date, the Company shall procure. The Company shall maintain in effect
during the term Directors’ and Officers’ Liability Insurance in an amount not
less than $1,000,000, which shall contain customary coverage for the Executive,
as long as such coverage can be secured at commercially reasonable cost.

 

(g)          Other Benefits.          The Executive shall be eligible to
participate in the employee benefit plans currently and hereafter maintained by
the Company of general applicability to other senior executives of the Company,
including, without limitation, the Company’s group medical, dental, vision,
disability, life insurance, and flexible-spending account plans.

 

(h)          Vacation and Personal Days.          The Executive shall be
entitled to four weeks of vacation during the first year of the Term and five
(5) weeks of vacation during each subsequent year of the Term, to be taken at
such times as the Executive may select, and the affairs of the Company may
permit. The Executive shall also be entitled to five (5) personal days during
each year of the Term or such greater number of personal days as may be afforded
employees generally under the Company’s policy in effect from time to time
during the Term. Vacation and personal days shall be taken by the Executive
without loss of compensation or other benefits to which he is entitled under
this Agreement. Unused vacation or personal days at the end of each year of the
Term shall be paid out to the Executive.

 

(i)           Withholding.           All amounts payable to the Executive under
this Section 3 shall be subject to all required federal, state and local
withholding, payroll and insurance taxes.

 

(j)           Board Discretion.          Nothing in this Section 3 shall
obligate the Board to implement any particular benefit plan or prevent the Board
from amending or terminating any benefit plan implemented.

 

 

 

 

1.            Termination.          The Executive’s employment may be terminated
and this Agreement terminated under the following circumstances:

 

(a)                 Death.          The Executive’s employment hereunder shall
terminate upon his death.

 

(b)                 Disability.          The Company may terminate the
Executive’s employment if the Executive becomes subject to a Disability. For
purposes of this Agreement, “Disability” means the Executive is unable to
perform the essential functions of his position as President, with or without a
reasonable accommodation, for a period of one hundred twenty (120) consecutive
calendar days or one hundred eighty (180) non-consecutive calendar days within
any rolling twelve (12) month period because of physical, mental, or emotional
incapacity, resulting from injury, sickness, or disease, as determined by the
Executive’s physician (or his guardian).

 

(c)                 Termination by Company for Cause.          The Company may
terminate the Executive’s employment for Cause. For purposes of this Agreement,
“Cause” means the Executive (i) is convicted of a felony which is related to the
Executive’s employment or the business of the Company; (ii) in carrying out his
duties hereunder, the Executive has been found in a civil action to have
committed gross negligence or intentional misconduct resulting, in either case,
in material harm to the Company; (iii) subject to a preliminary or permanent
injunction issued by a court of competent jurisdiction enjoining the Executive
from violating any federal securities law or any rule or regulation thereunder
promulgated by the Securities and Exchange Commission (the “SEC”); (iv) the
Executive becomes subject to a cease and desist order or other order issued by
the SEC after an opportunity for a hearing; or (v) the Executive has been found
in a civil action to have materially breached any provision of Section 8 and/or
Section 9 and to have thereby caused material harm to the Company. The term
“found in a civil action” shall not apply until all appeals permissible under
the applicable rules of procedure or statutes have been determined and no
further appeals are permissible. to the extent curable.

 

(d)                 Termination by the Company Without Cause.          A
termination of the Executive’s employment by the Company for any reason, except
death, disability or Cause, will be deemed to be a termination “Without Cause.”

 

(e)                 Termination by the Executive for Good Reason.          The
Executive may terminate his employment for “Good Reason.” For purposes of this
Agreement, “Good Reason” means (i) without the Executive’s written consent, a
material reduction of his duties, positions or responsibilities; (ii) without
the Executive’s written consent, a reduction by the Company in Base Salary as in
effect immediately prior to such reduction; (iii) the occurrence of a “Change in
Control” (as defined in Section 6); or (iii) the Company’s material breach of
this Agreement; provided that within ninety (90) days of the Company’s act or
omission giving rise to a resignation for Good Reason, the Executive notifies
the Company in writing of the act or omission, the Company fails to correct the
act or omission (to the extent curable) within thirty (30) days after receiving
the Executive’s written notice and the Executive actually terminates his
employment within sixty (60) days after the date the Company receives the
Executive’s notice.

 

(f)                  Termination by the Executive Without Good
Reason.          A resignation of the Executive’s employment for any reason
other than Good Reason will be deemed to be a resignation “Without Good Reason.”
The Executive may terminate his employment at any time Without Good Reason, upon
thirty (30) days prior written notice to the Company, provided however, the
Company may accelerate the date of such termination to any date following the
receipt of such written notice.

 

(g)                 Termination Date.          The “Termination Date” means (i)
if the Executive’s employment is terminated by his death under Section 4(a), the
date of his death; (ii) if the Executive’s employment is terminated on account
of his Disability under Section 4(b), the date on which the Company provides the
Executive a written termination notice; (iii) if the Company terminates the
Executive’s employment for Cause under Section 4(c), the date on which the
Company provides the Executive a written termination notice; (iv) if the Company
terminates the Executive’s employment Without Cause under Section 4(d), the date
on which the Company provides the Executive a written termination notice; (v) if
the Executive resigns his employment for Good Reason under Section 4(e), the
date on which the Executive provides the Company a written termination notice;
or (vii) if the Executive resigns his employment Without Good Reason under
Section 4(f), thirty (30) days after the date on which the Executive provides
the Company a written termination notice.

 

 

 

2.        Compensation Upon Termination.

 

(a)           Termination by the Company for Cause, upon the Executive’s Death
or by the Executive Without Good Reason.     If the Executive’s employment with
the Company is terminated pursuant to Sections 4(a), (c) or (f), the Company
shall pay or provide to the Executive (or to his authorized representative or
estate) (i) any earned but unpaid Base Salary as of the Termination Date; (ii)
unpaid expense reimbursements as of the Termination Date; (iii) any earned but
unpaid Bonus as of the Termination Date; and (iv) any vested benefits the
Executive may have under any employee benefit plan of the Company (the “Accrued
Obligations”), on or before the time required by law but in no event more than
thirty (30) days after the Termination Date.

 

(b)           Termination for Disability. If the Executive’s Employment is
terminated by reason of Disability pursuant to Section 4(b) then the Executive
shall be entitled to the following:

 

(i)          The Company shall pay the Executive the Accrued Obligations earned
through the Termination Date, on or before thirty (30) days after the
Termination Date.

 

(ii)         The Options and any subsequent equity award made to the Executive
during the Term, shall immediately vest in full and shall be exercised by the
Executive or his legal representatives in accordance with the terms of the
applicable employees plan or award document.

 

(iii)        Subject to the Executive’s timely election of continuation coverage
under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“COBRA”), the Company shall reimburse the Executive the monthly premium payable
to continue his and his eligible dependents’ participation in the Company’s
group health plan (to the extent permitted under applicable law and the terms of
such plan) which covers the Executive (and the Executive’s eligible dependents)
for a period of one year from the Termination Date, provided, however, that the
Executive remains eligible for COBRA coverage during such one-year period.

 

(c)           Termination by the Company Without Cause or by the Executive With
Good Reason.    If the Executive’s employment is terminated by the Company
Without Cause or the Executive terminates his employment for Good Reason, then
the Executive shall be entitled to the following:

 

(i)          The Company shall pay the Executive the Accrued Obligations earned
through the Termination Date, on or before thirty (30) days after the
Termination Date. (

 

(ii)         The Company shall pay the Executive his Base Salary (less
applicable withholding taxes) for the balance of the Term, in accordance with
the Company’s normal payroll practices in effect on the Termination Date.

 

(iii)        One hundred percent (100%) of the greater of the Executive’s Bonus
for the year of termination or the Bonus actually earned for the year prior to
the year of termination, if any; which amount will be paid within sixty (60)
days of the later of the Termination Date or the calculation of such Bonus.

 

(iv)        The Options and any subsequent equity award made to the Executive
during the Term, shall immediately vest in full and shall be exercised by the
Executive or his legal representatives in accordance with the terms of the
applicable employees plan or award document.

 

(v)         Subject to the Executive’s timely election of continuation coverage
under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“COBRA”), the Company shall reimburse the Executive the monthly premium payable
to continue his and his eligible dependents’ participation in the Company’s
group health plan (to the extent permitted under applicable law and the terms of
such plan) which covers the Executive (and the Executive’s eligible dependents)
for the period that the Executive is eligible and remains eligible for COBRA
coverage, provided, however, that in the event that the Executive obtains other
employment that offers group health benefits, such continuation of coverage by
the Company shall immediately cease.

 

3.Change in Control.

 

(a)           For the purposes of this Agreement, a "Change of Control" shall be
deemed to have taken place if (i) any person who is not an executive officer or
director of the Company as of the Effective Date, either individually or as a
"group" as defined in Section 13(d)(3) of the Securities Exchange Act of 1934,
as amended, becomes the owner or beneficial owner of Company securities, after
the date of this Agreement, having twenty-five percent (25%) or more of the
combined voting power of the then outstanding securities of the Company that may
be cast for the election of directors of the Company (other than as a result of
an issuance of securities initiated by the Company, or open market purchases
approved by the Board, as long as the majority of the Board approving the
purchases is the majority at the time the purchases are made); or (ii) the
persons who were directors of the Company before such transactions shall cease
to constitute a majority of the Board of the Company, or any successor to the
Company, as the direct or indirect result of or in connection with, any cash
tender or exchange offer, merger or other business combination, sale of assets
or contested election, or any combination of the foregoing transaction.

 

 

 

 

(b)          The Company and the Executive hereby agree that, if the Executive
is affiliated with the Company on the date on which a Change of Control occurs
(the "Change of Control Date"), the Company will continue to retain the
Executive and the Executive will remain affiliated with the Company for the
period commencing on the Change of Control Date and ending on the third (3rd)
anniversary of the Change in Control Date, to exercise such authority and
perform such executive duties as are commensurate with the authority being
exercised and duties being performed by the Executive immediately prior to the
Change of Control Date. If after the Change of Control Executive is requested,
and, in his sole and absolute discretion, consents to change his principal
business location, the Company will reimburse the Executive for his reasonable
relocation expenses, including, without limitation, moving expenses, temporary
living and travel expenses for a reasonable time while arranging to move his
residence to the changed location, closing costs, if any, associated with the
sale of his existing residence and the purchase of a replacement residence at
the changed location, plus an additional amount representing a gross-up of any
state or federal taxes payable by the Executive as a result of any such
reimbursement. If the Executive shall not consent to change his business
location, the Executive may continue to provide the services required of him
hereunder from his then residence and/or business address, and the Company shall
continue to maintain an office for the Executive at that location commensurate
with the Company's office prior to the Change of Control Date.

 

(c)          During the remaining Term of this Agreement commencing upon the
Change of Control Date, the Company will (i) continue to pay Executive a salary
at not less than the level applicable to Executive on the Change of Control
Date; (ii) pay Executive Bonuses in amounts not less in amount than those paid
during the twelve (12) month period preceding the Change of Control Date; and
(iii) continue employee benefit programs as to Executive at levels in effect on
the Change of Control Date (but subject to such reductions as may be required to
maintain such plans in compliance with applicable federal law regulating
employee benefit programs).

 

(d)          If during the remaining Term of this Agreement after the Change of
Control Date (i) Executive's employment is terminated by the Company; or (ii)
there shall have occurred a material reduction in Executive's compensation or
employment related benefits, or a material change in the Executive's status,
working conditions, management responsibilities or titles, and Executive
voluntarily terminates his relationship with the Company within sixty (60) days
of an such occurrence, or the last in a series of occurrences, then Executive
shall be entitled to receive, in addition to the compensation provided for in
Section 5(b), and subject to the provisions of subsections (e) and (f) below, a
lump sum payment equal to two hundred ninety-nine percent (299%) of Executive's
“base period income” as determined under (e) below, plus an additional amount
representing a gross-up of any state or federal taxes payable by Executive as a
result of any such payment. Such amount will be paid to Executive within thirty
(30) days after his termination of his affiliation with the Company.

 

(e)          The Executive's “base period income” shall be his Base Salary and
Bonuses paid or payable to him during or with respect to the twelve (12) month
period preceding the date of his termination of affiliation. If Executive has
not been affiliated for twelve (12) months at the time of his termination of
affiliation, his “base period income” shall be his annualized Base Salary at the
rate then in effect and any Performance Bonus paid to Executive prior to the
date of his termination of affiliation or payable to Executive with respect to
his period of affiliation.

 

(f)           In the event of a proposed Change in Control, the Company will
allow Executive to participate in all meetings and negotiations related thereto.

 

 

 

 

4.           Section 409A Compliance.

 

(a)        All in-kind benefits provided and expenses eligible for reimbursement
under this Agreement shall be provided by the Company or incurred by the
Executive during the time periods set forth in this Agreement. All
reimbursements shall be paid as soon as administratively practicable, but in no
event shall any reimbursement be paid after the last day of the taxable year
following the taxable year in which the expense was incurred. The amount of
in-kind benefits provided or reimbursable expenses incurred in one taxable year
shall not affect the in-kind benefits to be provided or the expenses eligible
for reimbursement in any other taxable year. Such right to reimbursement or
in-kind benefits is not subject to liquidation or exchange for another benefit.

 

(b)        To the extent that any of the payments or benefits provided for in
Section 5(b) are deemed to constitute non-qualified deferred compensation
benefits subject to Section 409A of the United States Internal Revenue Code (the
“Code”), the following interpretations apply to Section 5: Any termination of
the Executive’s employment triggering payment of benefits under Section 5(b)
must constitute a “separation from service” under Section 409A(a)(2)(A)(i) of
the Code and Treas. Reg. §1.409A-1(h) before distribution of such benefits can
commence. To the extent that the termination of the Executive’s employment does
not constitute a separation of service under Section 409A(a)(2)(A)(i) of the
Code and Treas. Reg. §1.409A-1(h) (as the result of further services that are
reasonably anticipated to be provided by the Executive to the Company or any of
its parents, subsidiaries or affiliates at the time the Executive’s employment
terminates), any benefits payable under Section 5 that constitute deferred
compensation under Section 409A of the Code shall be delayed until after the
date of a subsequent event constituting a separation of service under Section
409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h). For purposes of
clarification, this Section 7(b) shall not cause any forfeiture of benefits on
the Executive’s part, but shall only act as a delay until such time as a
“separation from service” occurs. Further, if the Executive is a “specified
employee” (as that term is used in Section 409A of the Code and regulations and
other guidance issued thereunder) on the date his separation from service
becomes effective, any benefits payable under Section 5 that constitute
non-qualified deferred compensation under Section 409A of the Code shall be
delayed until the earlier of (i) the business day following the six-month
anniversary of the date his separation from service becomes effective; and (ii)
the date of the Executive’s death, but only to the extent necessary to avoid
such penalties under Section 409A of the Code. On the earlier of (i) the
business day following the six-month anniversary of the date his separation from
service becomes effective; and (ii) the Executive’s death, the Company shall pay
the Executive in a lump sum the aggregate value of the non-qualified deferred
compensation that the Company otherwise would have paid the Executive prior to
that date under Section 5(b) of this Agreement. It is intended that each
installment of the payments and benefits provided under Section 5(b) of this
Agreement shall be treated as a separate “payment” for purposes of Section 409A
of the Code. Neither the Company nor the Executive shall have the right to
accelerate or defer the delivery of any such payments or benefits except to the
extent specifically permitted or required by Section 409A of the Code.

 

5.            Confidential Information.

 

(a)         As used in this Agreement, “Confidential Information” means
information belonging to the Company which is of value to the Company in the
course of conducting its business and the disclosure of which could result in a
competitive or other disadvantage to the Company. Confidential Information
includes, without limitation, financial information, reports, and forecasts;
inventions, improvements and other intellectual property; trade secrets;
know-how; designs, processes or formulae; software; market or sales information
or plans; customer lists; business plans, prospects and opportunities (such as
possible acquisitions or dispositions of businesses or facilities) which have
been discussed or considered by the management of the Company. Confidential
Information includes information developed by the Executive in the course of the
Executive’s employment by the Company, as well as other information to which the
Executive may have access in connection with his employment. Confidential
Information also includes the confidential information of others with which the
Company has a business relationship. Notwithstanding the foregoing, Confidential
Information does not include (i) information which now or in the future comes
into the public domain, unless due to breach of the Executive’s duties under
this Section 8(a); (ii) information which is disclosed to Executive by others
who are not, to Executive’s actual knowledge, under obligation of non-disclosure
to the Company; (iii) information which is independently developed by the
Executive without breach of the Executive’s duties under this Section 8(a); or
(iv) information which is disclosed by the Company to others without obligation
of confidentiality.

 

 

 

 

(b)         At all times, both during the Executive’s employment with the
Company and after its termination, the Executive will keep in confidence and
trust all Confidential Information, and will not use or disclose for his own
benefit or the benefit of any other Person any such Confidential Information
without the written consent of the Company, except as may be necessary in the
ordinary course of performing the Executive’s duties to the Company.

 

6.            Documents, Records, Etc.            All documents, records, data,
apparatus, equipment and other physical property, whether or not pertaining to
Confidential Information, which are furnished to the Executive by the Company or
are produced by the Executive in connection with the Executive’s employment will
be and remain the sole property of the Company. The Executive will return to the
Company all such materials and property as and when requested by the Company. In
any event, the Executive will return all such materials and property immediately
upon termination of the Executive’s employment for any reason. The Executive
will not retain any such material or property or any copies thereof after the
termination of his employment.

 

7.            Non-Competition.            From the Effective Date through the
second (2nd) anniversary of the Termination Date, regardless of the reason for
such termination or expiration (the “Restricted Period”) the Executive will not,
directly or indirectly, whether as owner, partner, shareholder, consultant,
agent, employee, co-venturer or otherwise, engage, prepare to engage,
participate, assist or invest in any Competing Business anywhere in the United
States or any other geographic area in which the Company is actively
distributing its products or providing its services as of the Termination Date.
Notwithstanding the foregoing, (i) the Executive may own up to two percent (2%)
of the outstanding stock of a publicly held corporation which constitutes or is
affiliated with a Competing Business; and (ii) the Executive may be employed by
a large organization which is engaged in a Competing Business as its non-primary
business, so long as Executive is not involved with or assisting such Competing
Business, and so long as Executive does not breach his obligations regarding
Confidential Information.

 

11.          No Solicitation.            During the Restricted Period, the
Executive shall not, directly or indirectly, take any of the following actions,
and, to the extent the Executive owns, manages, operates, controls, is employed
by or participates in the ownership, management, operation or control of, or is
connected in any manner with, any business, the Executive shall use his best
efforts to ensure that such business does not take any of the following actions:

 

(a)           persuade or attempt to persuade any Customer, Prospective Customer
or Supplier to cease doing business with the Company, or to reduce the amount of
business it does with the Company;

 

(b)           solicit or service for himself or for any Person the business of a
Customer, Prospective Customer or Supplier in order to provide goods or services
that are competitive with the goods and services provided by the Company;

 

(c)           persuade or attempt to persuade any Service Provider to cease
providing services to the Company; or

 

(d)           solicit for hire or hire for himself or for any third party any
Service Provider.

 

The following definitions are applicable to Sections 8, 9, 10, and 11:

 

(i)          “Competing Business” means the offering in-office ancillary
opportunities and third-party billing to physicians and clinics and any other
business in which the services which the Company is engaged in as of the
Termination Date.

 

(ii)         “Customer” means any Person that purchased goods or services from
the Company at any time within two (2) years prior to the date of the
solicitation prohibited by Sections 11(a) or (b).

 

(iii)           “Prospective Customer” means any Person with whom the Company
met or to whom the Company presented for the purpose of soliciting the Person to
become a Customer of the Company within six (6) months prior to the date of the
solicitation prohibited by Sections 11(a) or (b).

 

 

 

 

(iv)           “Service Provider” means any Person who is an employee or
independent contractor of the Company or the Company or who was within twelve
(12) months preceding the solicitation prohibited by Sections 11(a) or (b) an
employee or independent contractor of the Company or the Company.

 

(v)            “Supplier” means any Person that sold goods or services to the
Company at any time within twelve (12) months prior to the date of the
solicitation prohibited by Sections 11(a) or (b).

 

(vi)       “Person” means an individual, a sole proprietorship, a corporation, a
limited liability company, a partnership, an association, a trust, or other
business entity, whether or not incorporated.

  

12.          Intellectual Property.

 

(a)           All creations, inventions, ideas, designs, copyrightable
materials, trademarks, and other technology and rights (and any related
improvements or modifications), whether or not subject to patent or copyright
protection (collectively, “Creations”), relating to any activities of the
Company which are conceived by the Executive or developed by the Executive in
the course of his employment with the Company, whether prior to or during the
Term, whether conceived alone or with others and whether or not conceived or
developed during regular business hours, shall be the sole property of the
Company and, to the maximum extent permitted by applicable law, shall be deemed
“works made for hire” as that term is used in the United States Copyright Act.

 

(b)           To the extent, if any, that the Executive retains any right, title
or interest with respect to any Creations delivered to the Company or related to
his employment with the Company, the Executive hereby grants to the Company an
irrevocable, paid-up, transferable, sub-licensable, worldwide right and license:
(i) to modify all or any portion of such Creations, including, without
limitation, the making of additions to or deletions from such Creations,
regardless of the medium (now or hereafter known) into which such Creations may
be modified and regardless of the effect of such modifications on the integrity
of such Creations; and (ii) to identify the Executive, or not to identify his,
as one or more authors of or contributors to such Creations or any portion
thereof, whether or not such Creations or any portion thereof have been
modified. The Executive further waives any “moral” rights, or other rights with
respect to attribution of authorship or integrity of such Creations that he may
have under any applicable law, whether under copyright, trademark, unfair
competition, defamation, and right of privacy, contract, tort or other legal
theory.

 

(c)           The Executive will promptly inform the Company of any Creations.
The Executive will also allow the Company to inspect any Creations he conceives
or develops within one (1) year after the termination of his employment for any
reason to determine if they are based on Confidential Information. The Executive
shall (whether during his employment or after the termination of his employment)
execute such written instruments and do other such acts as may be necessary in
the opinion of the Company or its counsel to secure the Company’s rights in the
Creations, including obtaining a patent, registering a copyright, or otherwise
(and the Executive hereby irrevocably appoints the Company and any of its
officers as his attorney in fact to undertake such acts in his name). The
Executive’s obligation to execute written instruments and otherwise assist the
Company in securing its rights in the Creations will continue after the
termination of his employment for any reason. The Company shall reimburse the
Executive for any out-of-pocket expenses (but not attorneys’ fees) he incurs in
connection with his compliance with this Section 12(c).

 

13.           Acknowledgement.       The Executive understands that the
restrictions set forth in Sections 8, 9, 10, and 11 of this Agreement are
intended to protect the Company’s interest in its Confidential Information,
goodwill and established employee and customer relationships, and agrees that
such restrictions are reasonable and appropriate for this purpose.

 

 

 

 

14.         Indemnification.            During the Term and thereafter, the
Company shall indemnify and hold the Executive and the Executive’s heirs and
representatives harmless, to the maximum extent permitted by law, against any
and all damages, costs, liabilities, losses and expenses (including reasonable
attorneys’ fees) as a result of any claim or proceeding (whether civil,
criminal, administrative or investigative), or any threatened claim or
proceeding (whether civil, criminal, administrative or investigative), against
the Executive that arises out of or relates to the Executive’s service as an
officer, director or employee, as the case may be, of the Company, or the
Executive’s service in any such capacity or similar capacity with any affiliate
of the Company or other entity at the Company’s request, both prior to and after
the Effective Date, and to promptly advance to the Executive or the Executive’s
heirs or representatives such expenses, including litigation costs and
attorneys’ fees, upon written request with appropriate documentation of such
expense upon receipt of an undertaking by the Executive or on the Executive’s
behalf to repay such amount if it shall ultimately be determined that the
Executive is not entitled to be indemnified by the Company. During the Term and
thereafter, the Company also shall provide the Executive with coverage under its
current directors’ and officers’ liability policy to the same extent that it
provides such coverage to its other executive officers. If the Executive has any
knowledge of any actual or threatened action, suit or proceeding, whether civil,
criminal, administrative or investigative, as to which the Executive may request
indemnity under this provision, the Executive will give the Company prompt
written notice thereof; provided that the failure to give such notice shall not
affect the Executive’s right to indemnification. The Company shall be entitled
to assume the defense of any such proceeding and the Executive will use
reasonable efforts to cooperate with such defense. To the extent that the
Executive in good faith determines that there is an actual or potential conflict
of interest between the Company and the Executive in connection with the defense
of a proceeding, the Executive shall so notify the Company and shall be entitled
to separate representation at the Company’s expense by counsel selected by the
Executive (provided that the Company may reasonably object to the selection of
counsel within ten (10) business days after notification thereof) which counsel
shall cooperate, and coordinate the defense, with the Company’s counsel and
minimize the expense of such separate representation to the extent consistent
with the Executive’s separate defense.

 

15.         Survival.            The provisions of Sections 8, 9, 10, 11, 12,
14, 15, 16 and 22 of this Agreement shall survive its expiration or termination.

 

16.         Disputes.

 

(a)         The parties agree to resolve any dispute arising under or relating
to the interpretation or enforcement of this Agreement, the Executive’s
employment or the termination of the Executive’s employment before the Florida
state courts of Miami-Dade County, Florida or the United States District Court
for the Southern District of Florida, and hereby consent to the exclusive
jurisdiction of such courts. Accordingly, with respect to any such court action,
the Executive and the Company each (i) submits to the personal jurisdiction of
these courts; (ii) consents to service of process under the notice provisions
set forth in Section 21 of this Agreement; (iii) waives any other requirement
(whether imposed by statute, rule of court, or otherwise) with respect to
personal jurisdiction or service of process; and (iv) waives any objection to
jurisdiction based on improper venue or improper jurisdiction.

 

(b)         Notwithstanding anything else provided in this Agreement, the
Executive agrees that it would be difficult to measure any damages caused to the
Company which might result from any breach by the Executive of Sections 8, 9,
10, 11 and 12 of this Agreement. Accordingly, if the Executive breaches or
proposes to breach, any term of Sections 8, 9, 10, 11 and 12 of this Agreement,
the Company shall be entitled, in addition to all other remedies that it may
have, to a temporary and preliminary injunction or other appropriate equitable
relief to restrain any such breach without showing or providing any actual
damage to the Company from any court having competent jurisdiction over the
Executive.

 

(c)         BOTH THE COMPANY AND THE EXECUTIVE HEREBY WAIVE ANY RIGHT TO A TRIAL
BY JURY TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE FEDERAL OR STATE LAW.

 

(d)         The prevailing party shall be entitled to reasonable attorneys’ fees
and costs from the non-prevailing party in connection with any action filed
under this Section 16.

 

17.         Integration.            This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements between the parties concerning such subject
matter, including without limitation, the Original Employment Agreement.

 

18.         Successors.            This Agreement shall inure to the benefit of
and be enforceable by the Executive’s personal representatives, executors,
administrators, heirs, distributees, devisees and legatees. In the event of the
Executive’s death after his termination of employment but prior to the
completion by the Company of all payments due him under this Agreement, the
Company shall continue such payments to the Executive’s beneficiary designated
in writing to the Company prior to his death (or to his estate, if the Executive
fails to make such designation). The Company shall require any successor to the
Company to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform it
if no such succession had taken place.

 

 

 

 

19.             Enforceability.        If any portion or provision of this
Agreement (including, without limitation, any portion or provision of any
section of this Agreement) shall to any extent be declared illegal or
unenforceable by a court of competent jurisdiction, then the remainder of this
Agreement, or the application of such portion or provision in circumstances
other than those as to which it is so declared illegal or unenforceable, shall
not be affected thereby, and each portion and provision of this Agreement shall
be valid and enforceable to the fullest extent permitted by law.

 

20.                Waiver.         No waiver of any provision hereof shall be
effective unless made in writing and signed by the waiving party. The failure of
any party to require the performance of any term or obligation of this
Agreement, or the waiver by any party of any breach of this Agreement, shall not
prevent any subsequent enforcement of such term or obligation or be deemed a
waiver of any subsequent breach.

 

21.                Notices.         Any notices, requests, demands and other
communications provided for by this Agreement shall be sufficient if in writing
and delivered in person or sent by a nationally recognized overnight courier
service or by certified mail, postage prepaid, return receipt requested, to the
Executive at the last address the Executive has filed in writing with the
Company or, in the case of the Company, at its main offices, attention of the
Chief Financial Officer. Notices shall be effective on receipt, if delivered by
hand, the next business day, if sent by overnight courier service or on the
third (3rd) business day after mailing, if sent by mail.

 

22.                Amendment.          This Agreement may be amended or modified
only by a written instrument signed by the Executive and by a duly authorized
representative of the Company.

 

23.                Governing Law.       This is a Florida contract and shall be
construed under and be governed in all respects by the laws of Florida for
contracts to be performed in that state and without giving effect to the
conflict of laws principles of Florida or any other state.

 

24.                “Company” Defined.            As used in this Agreement, the
term “Company” shall mean the Company, its parent, subsidiaries and divisions.

 

25.                Counterparts.            This Agreement may be executed in
any number of counterparts, including by facsimile, .PDF or other electronic
transmission (which shall be deemed to be an original), each of which when so
executed and delivered shall be taken to be an original; but such counterparts
shall together constitute one and the same document.

 

IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
Effective Date.

 

  THE COMPANY:       HEALTH-RIGHT DISCOVERIES, INC.       By:       Name:    
Title:       THE EXECUTIVE:           David Hopkins