Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (this “Agreement”), dated as of April 19, 2019,
between IMAC Holdings, Inc., a Delaware corporation (the “Company”), and Dr.
Jason Hui (the “Executive”).

W I T N E S S E T H:

WHEREAS, the Company desires to retain the services of the Executive and to that
end desires to enter into a contract of employment with him, upon the terms and
conditions herein set forth upon the successful completion of the execution of
the definitive agreement sale; and

WHEREAS, the Executive desires to be employed by the Company upon such terms and
conditions;

NOW, THEREFORE, in consideration of the premises and of the mutual benefits and
covenants contained herein, the parties hereto, intending to be bound, hereby
agree as follows:

1.       APPOINTMENT AND TERM

Subject to the terms hereof, the Company hereby employs the Executive, and the
Executive hereby accepts employment with the Company, all in accordance with the
terms and conditions set forth herein, for a period commencing on the date set
forth in Exhibit A or such later date as the parties mutually agree to in
writing (the “Commencement Date”), and ending on the third anniversary of the
Commencement Date (the “Expiration Date”),

 

 

2.       DUTIES

(a)       During the term of this Agreement, the Executive shall be employed in
the position set forth in Exhibit A and shall, unless prevented by incapacity,
devote substantially all of his business time, attention and ability during
normal corporate office business hours to the discharge of his duties hereunder
and to the faithful and diligent performance of such duties and the exercise of
such powers as may be reasonably assigned to or vested in him by the Board of
Directors of the Company (the “Board”), such duties to be consistent with his
position. The Executive shall obey the lawful directions of the Board, and shall
use his diligent efforts to promote the interests of the Company and to maintain
and promote the reputation thereof.

(b)       The Executive shall not during his term of employment (except as a
representative of the Company or with the consent in writing of the Board) be
directly or indirectly engaged or concerned or interested in any other business
activity that competes with the Company, except that the Executive may continue
providing services under his current arrangements with Edward Rusher and Dr.
Kasey Beardon (collectively, the “Permitted Activities”). All other investments
or engagements shall not impair the ability of the Executive to discharge fully
and faithfully his duties hereunder.

(c)       Notwithstanding the foregoing provisions, the Executive shall be
entitled to serve in various leadership capacities in civic, charitable and
professional organizations. The Executive recognizes that his primary and
paramount responsibility is to the Company.

(d)       The Executive shall remain in leadership for the Chicago, Illinois,
operations except for required travel on the Company’s business.

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3.       REMUNERATION

(a)       As compensation for his services pursuant hereto, the Executive shall
be paid a base salary during his employment hereunder at the annual rates set
forth in Exhibit A (“Base Salary”). This amount shall be payable in equal
periodic installments in accordance with the usual payroll practices of the
Company.

(b)       Except as provided above, in Exhibit A and in Sections 4 and 6 hereof,
the Executive shall not be entitled to receive any additional compensation,
remuneration or other payments from the Company.

4.       FRINGE BENEFITS

The Executive shall be entitled to participate in regular employee fringe
benefit programs to the extent such programs are offered by the Company to its
executive employees, including, but not limited to, medical insurance or stipend
and 401(k) plan.

5.       VACATION

The Executive shall be entitled to the number of weeks of vacation set forth in
Exhibit A (in addition to the usual national holidays) during each contract year
during which he serves hereunder. Such vacation shall be taken at such time or
times as will be mutually agreed between the Executive and the Company.

6.       REIMBURSEMENT FOR EXPENSES

The Executive shall be reimbursed for reasonable documented business expenses
incurred in connection with the business of the Company in accordance with
practices and policies established by the Company.

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7.       TERMINATION

(a)       This Agreement shall terminate in accordance with the terms of Section
7 hereof; provided, however, that such termination shall not affect the
obligations of the Executive pursuant to the terms of Sections 8 and 9.

(b)       This Agreement shall terminate on the Expiration Date; or as follows:

(i)       Upon the written notice to the Executive by the Company at any time,
because of the willful and material malfeasance, dishonesty or habitual drug or
alcohol abuse by the Executive related to or affecting the performance of his
duties, or upon the Executive’s conviction of a felony, any crime involving
moral turpitude (including, without limitation, sexual harassment) related to or
affecting the performance of his duties or any act of fraud, embezzlement, theft
or willful breach of fiduciary duty against the Company.

(ii)       In the event the Executive, by reason of physical or mental
disability, shall be unable to perform the services required of his hereunder
for a period of more than 60 consecutive days, or for more than a total of 90
non-consecutive days in the aggregate during any period of twelve (12)
consecutive calendar months, on the 61st consecutive day, or the 91st day, as
the case may be. The Executive agrees, in the event of any dispute under this
Section 7(b)(ii), and after written notice by the Board, to submit to a physical
examination by a licensed physician practicing near the Executive as selected by
the Board, and reasonably acceptable to the Executive.

(iii)       In the event the Executive dies while employed pursuant hereto, on
the day in which his death occurs.

(c)       If this Agreement is terminated pursuant to Section 7(b), the Company
will have no further liability to the Executive after the date of termination
including, without limitation, the compensation and benefits described herein,
except as set forth in Exhibit A. If this Agreement is terminated by the Company
for any reason other than those set forth in Section 7(b), Company shall
continue to pay Executive his then current Base Salary for a period of six (6)
months.

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(d)       In the event the Company chooses not to enter into any agreement or
amendment extending the Executive’s employment beyond the Expiration Date, the
Company agrees to either i) provide Executive at least 60 days prior written
notice of such determination, during which time the Executive will not be
required to perform any duties for the Company, and may seek alternative
employment while still being employed by the Company, or ii) provide Executive
180 days prior written notice of such determination, during which time the
Executive will be required to perform his regular duties for the Company, and
may seek alternative employment while still being employed by the Company. If
such prior written notice is not given, this Agreement shall be automatically
extended by one (1) year and the then effective annual Base Salary shall be
increased by 4%.

(e)       If there is a Change of Control (as defined below), the Executive may,
at any time within six months after such Change of Control, provide at least 30
days’ written notice to Company that the Executive has decided to terminate his
employment with the Company and the Executive shall nevertheless continue to be
paid pursuant to this Agreement until the date on which this Agreement would
otherwise have terminated or expired. A Change of Control shall be deemed to
have occurred at such time as any person, other than the Company, its existing
shareholders or any of its or their affiliates on the date hereof, purchases the
“beneficial ownership” (as defined in Rule 13d-3 under the Securities Exchange
Act of 1934), directly or indirectly, of 50% or more of the combined voting
power of voting securities then ordinarily having the right to vote for
directors of the Company.

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8.       CONFIDENTIAL INFORMATION

(a)       The Executive covenants and agrees that he will not at any time during
the continuance of this Agreement or at any time thereafter (i) print, publish,
divulge or communicate to any person, firm, corporation or other business
organization (except in connection with the Executive’s employment hereunder) or
use for his own account any secret or confidential information relating to the
business of the Company (including, without limitation, information relating to
any customers, suppliers, employees, products, services, formulae, technology,
know-how, trade secrets or the like, financial information or plans) or any
secret or confidential information relating to the affairs, dealings, projects
and concerns of the Company, both past and planned (the “Confidential
Information”), which the Executive has received or obtained or may receive or
obtain during the course of his employment with the Company (whether or not
developed, devised or otherwise created in whole or in part by the efforts of
the Executive as an employee of the Company), or (ii) take with him, upon
termination of his employment hereunder, any information in paper or document
form or on any computer-readable media relating to the foregoing. The term
“Confidential Information” does not include information which is or becomes
generally available to the public other than as a result of disclosure by the
Executive in breach of this Agreement or which is generally known in the
regenerative medicine business. The Executive further covenants and agrees that
he shall retain the Confidential Information received or obtained during such
service in trust for the sole benefit of the Company or its successors and
assigns.

(b)       The term Confidential Information as defined in Section 8(a) hereof
shall include information obtained by the Company from any third party under an
agreement including restrictions on disclosure known to the Executive.

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(c)       In the event that the Executive is requested pursuant to subpoena or
other legal process to disclose any of the Confidential Information, the
Executive will provide the Company with prompt notice so that the Company may
seek a protective order or other appropriate remedy and/or waive compliance with
Section 8 of this Agreement. In the event that such protective order or other
remedy is not obtained or that the Company waives compliance with the provisions
of Section 8 of this Agreement, the Executive will furnish only that portion of
the Confidential Information which is legally required.

9.       RESTRICTIONS DURING EMPLOYMENT AND FOLLOWING TERMINATION

(a)       The Executive shall not, anywhere within 15 miles of an IMAC
Regeneration Center, during his full term of employment under Section 1 hereof
and for a period of one (1) year thereafter, notwithstanding any earlier
termination pursuant to Section 7(b) hereof, without the prior written consent
of the Company, directly or indirectly, and whether as principal, agent,
officer, director, partner, employee, consultant, broker, dealer or otherwise,
alone or in association with any other person, firm, corporation or other
business organization, carry on, or be engaged, have an interest in or take part
in, or render services to any person, firm, corporation or other business
organization (other than the Company) engaged in a business which is competitive
with all or part of the Business of the Company, unless approved by the CEO or
COO. The parties hereby acknowledge that the Permitted Activities have been
approved by the CEO or COO. A formal teaching engagement with a university or
continuing education program and any existing board membership is excluded from
prior approval requirements. The term “Business of the Company” shall mean
delivering regenerative and physical medicine services.

(b)       The Executive shall not, for a period of one (1) year after
termination of his employment hereunder, either on his own behalf or on behalf
of any other person, firm, corporation or other business organization, endeavor
to entice away from the Company any person who, at any time during the
continuance of this Agreement, was an employee of the Company.

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(c)       The Executive shall not, for a period of one (1) year after
termination of his employment hereunder, either on his own behalf or on behalf
of any other person, firm, corporation or other business organization, solicit
or direct others to solicit, any of the Company’s customers or prospective
customers (including, but not limited to, those customers or prospective
customers with whom the Executive had a business relationship during his term of
employment) for any purpose or for any activity which is competitive with all or
part of the Business of the Company.

(d)       It is understood by and between the parties hereto that the foregoing
covenants by the Executive set forth in this Section 9 are essential elements of
this Agreement and that, but for the agreement of the Executive to comply with
such covenants, the Company would not have entered into this Agreement. It is
recognized by the Executive that the Company currently operates in, and may
continue to expand its operations. The Company and the Executive have
independently consulted with their respective counsel and have been advised in
all respects concerning the reasonableness and propriety of such covenants.

10.       REMEDIES

(a)       Without intending to limit the remedies available to the Company, it
is mutually understood and agreed that the Executive’s services are of a
special, unique, unusual, extraordinary and intellectual character giving them a
peculiar value, the loss of which may not be reasonably or adequately
compensated in damages in an action at law, and, therefore, in the event of any
material breach by the Executive that continues after any applicable cure
period, the Company shall be entitled to equitable relief by way of injunction
or otherwise.

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(b)       The covenants of Section 8 shall be construed as independent of any
other provisions contained in this Agreement and shall be enforceable as
aforesaid notwithstanding the existence of any claim or cause of action of the
Executive against the Company, whether based on this Agreement or otherwise. In
the event that any of the provisions of Sections 8 or 9 hereof should ever be
adjudicated to exceed the time, geographic, product/service or other limitations
permitted by applicable law in any jurisdiction, then such provisions shall be
deemed reformed in any such jurisdiction to the maximum time, geographic,
product/service or other limitations permitted by applicable law.

11.       COMPLIANCE WITH OTHER AGREEMENTS

The Executive represents and warrants to the Company that the execution of this
Agreement by him and his performance of his obligations hereunder will not, with
or without the giving of notice or the passage of time or both, conflict with,
result in the breach of any provision of or the termination of, or constitute a
default under, any agreement to which the Executive is a party or by which the
Executive is or may be bound.

12.       WAIVERS

The waiver by the Company or the Executive of a breach of any of the provisions
of this Agreement shall not operate or be construed as a waiver of any
subsequent breach.

13.       BINDING EFFECT; BENEFITS

This Agreement shall inure to the benefit of, and shall be binding upon, the
parties hereto and their respective successors, assigns, heirs and legal
representatives, including any corporation or other business organization with
which the Company may merge or consolidate or sell all or substantially all of
its assets. Insofar as the Executive is concerned, this contract, being
personal, cannot be assigned.

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14.       NOTICES

All notices and other communications which are required or may be given under
this Agreement shall be in writing and shall be deemed to have been duly given
when delivered to the person to whom such notice is to be given at his or its
address set forth below, or such other address for the party as shall be
specified by notice given pursuant hereto:

(a)If to the Executive, to his at the address set forth in Exhibit A.

and

(b)If to the Company, to it at:

IMAC Holdings, Inc.

1605 Westgate Circle

Brentwood, TN 37027

Attention: Chief Executive Officer

 

with a copy to:

 

Olshan Frome Wolosky LLP

1325 Avenue of the Americas, 15th Floor

New York, New York 10019

Attention: Spencer G. Feldman, Esq.

 

15.       MISCELLANEOUS

(a)       This Agreement contains the entire agreement between the parties
hereto and supersedes all prior agreements and understandings, oral or written,
between the parties hereto with respect to the subject matter hereof. This
Agreement may not be changed, modified, extended or terminated except upon
written amendment approved by the Board and executed by a duly authorized
officer of the Company.

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(b)       The Executive acknowledges that from time to time, the Company may
establish, maintain and distribute employee manuals or handbooks or personnel
policy manuals, and officers or other representatives of the Company may make
written or oral statements relating to personnel policies and procedures. Such
manuals, handbooks and statements are intended only for general guidance. No
policies, procedures or statements of any nature by or on behalf of the Company
(whether written or oral, and whether or not contained in any employee manual or
handbook or personnel policy manual), and no acts or practices of any nature,
shall be construed to modify this Agreement or to create express or implied
obligations of any nature to the Executive.

(c)       The Company shall have no obligation actually to utilize the
Executive’s services; if the Company elects not to use the Executive’s services
at any time, the Company’s obligations to the Executive shall be satisfied, in
all respects, by the payment to the Executive for the balance of the term of the
Executive’s employment under this Agreement, but for a minimum period of three
(3) years, the compensation provided in this Agreement. During such remaining
term of employment, the Executive will not be required to perform any duties for
the Company and shall be entitled to seek other employment provided that such
employment would not violate the terms of this Agreement, including Sections 8
and 9 hereof; and the seeking of such employment shall not be deemed a violation
of this Agreement.

(d)       This Agreement may be executed in counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute one and the
same instrument.

(e)       All questions pertaining to the validity, construction, execution and
performance of this Agreement shall be governed by and construed in accordance
with the laws of the state of residence and the location of full-time employment
of Executive, without regard to its conflict of law principles. If the state of
residence and of full-time employment differ, the Agreement shall be governed in
accordance with the laws of the State of Illinois.

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(f)       Any controversy or claim arising from, out of or relating to this
Agreement, or the breach hereof (other than controversies or claims arising
from, out of or relating to the provisions in Sections 8, 9 and 10), shall be
determined by final and binding arbitration in Illinois, or the current location
of Company’s corporate headquarters, in accordance with the Employment Dispute
Resolution Rules of the American Arbitration Association, by a panel of not less
than three (3) arbitrators appointed by the American Arbitration Association.
The decision of the arbitrators may be entered and enforced in any court of
competent jurisdiction by either the Company or the Executive.

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The parties indicate their acceptance of the foregoing arbitration requirement
by initialing below:

 

  JE   JH     For the Company   Executive  

 

 

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

  IMAC HOLDINGS, INC.       By: /s/ Jeffrey Ervin
 
    Name: Jeffrey Ervin     Title: Chief Executive Officer

 

 

  EXECUTIVE       /s/ Jason Hui
 
  Jason Hui

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EXHIBIT A TO THE EMPLOYMENT AGREEMENT,
DATED AS OF APRIL 19, 2019,
BETWEEN IMAC HOLDINGS, INC. AND DR. JASON HUI

A.       For Section 1:

The date referred to in Section 1 shall be April 19, 2019.

B.       For Section 2:

The position of the Executive referred to in Section 2 shall be EVP of
Development, reporting to the Chief Operations Officer.

C.       For Section 3(a):

The Base Salary referred to in Section 3(a) shall be as follows:

1.Three hundred fifty thousand dollars ($350,000.00) for the period April 1,
2019 through March 31, 2020.

2.Three hundred fifty-five thousand dollars ($355,000.00) for the period April
1, 2020 through March 31, 2021.

3.Three hundred sixty thousand dollars ($360,000.00) for the period April 1,
2021 through March 31, 2022.

 

D.       For Section 3(b):

In addition to the compensation referred to in Section 3(a), the Company shall
also pay to the Executive a one-time bonus of $15,000.00 related to a same store
net revenue increase in Chicago in 2019 compared to 2018.

An annual cash bonus up to 20% of Base Salary in an amount to be determined by
the Board based on the Executive meeting and exceeding mutually agreed upon
performance goals for the Company.

The Executive shall be reimbursed $100 per month for the business use of his
personal cell phone and shall receive reimbursement for health care coverage as
set forth in Section E.

A stock option award of 20,000 shares will be granted upon adoption of the
incentive stock option plan.

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E.       For Section 4:

The Health Insurance and Other Company Paid Fringe Benefits for the Executive
shall include:

A monthly reimbursement for health insurance, which shall cover all
out-of-pocket costs that Executive incurs for health insurance coverage for
himself and his dependents. Standard eligibility for 401k will apply, including
company matching contributions subject to rules, regulations, and compliance
requirements.

The Company will allow for complementary regenerative medicine treatments for
the Executive and immediate family during the Term of this Agreement, within
reason and not to exceed two procedures annually when cost of goods exceed
$1,000.

The Company will assume and pay for expenses including and related to licensure,
professional liability, and continuing education fees, within reason and within
the course of normal business.

F.       For Section 5:

The length of vacation referred to in Section 5 shall be three weeks annually.
Vacation not taken during any calendar year may be carried forward as follows:
up to one (1) week may be carried forward into any next calendar year; and up to
a maximum of one (1) week may be carried forward cumulatively.

G.       For Sections 7 and 15(c):

In the case of termination pursuant to Section 7(b)(ii), the Executive will
receive his then current Base Salary until such time as payments begin under any
disability insurance plan or Supplemental Long-Term Disability Benefit of the
Executive and, in the case of termination pursuant to Section 7(b)(iii), the
Executive’s spouse will continue to receive Executive’s then current Base Salary
for a period of six (6) months. In the case of termination pursuant to Sections
7(b)(ii), 7(b)(iii) or 15(c), the Executive, his heirs or assignees may elect to
have any, or all, stock options, warrants or other grants under the Company’s
Incentive Compensation Plans become immediately exercisable.

H.       For Section 14:

The address of the Executive referred to in Section 14 shall be:

___________________________

___________________________

 

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