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Exhibit 10.1

EMPLOYMENT AGREEMENT

 
THIS AGREEMENT (the “Agreement”) is to be effective as of April 15, 2009 (the
“Effective Date”), between Health Discovery Corporation (the “Company”), and R.
Scott Tobin (the “Executive”).
 
INTRODUCTION

The Company and the Executive now desire to enter into this Agreement as to the
terms of his employment by the Company.
 
NOW, THEREFORE, the parties agree as follows:
 
1.            Terms and Conditions of Employment.
 
(a)           Employment.  During the Term, Company will employ the Executive,
and the Executive will serve as the President and General Counsel of the Company
on a full-time basis and will have such responsibilities and authority as may
from time to time be assigned to the Executive by the CEO of the
Company.  Executive shall be responsible for:  strategic direction and strategic
alliances (in conjunction with the CEO and the Board of Directors of the
Company); all business operations of the Company including but not limited to
financial management, controller, financial systems management and preparation
of all documents required of the Company by the Securities and Exchange
Commission; and such customary, appropriate and reasonable executive duties as
are usually performed by a general counsel.  In this capacity, Executive will
provide services to the Company and be privy to the Company’s Confidential
Information and Trade Secrets.  The Executive will report to the CEO of the
Company. Executive shall serve on the Board of Directors without additional
compensation beyond that set forth in this Agreement, and shall continue to
serve for so long as he is thereafter elected to such position by the Company’s
stockholders. The Executive’s primary office will be at the Company’s
headquarters in such geographic location within the United States as may be
determined by the Company.
 
(b)           Exclusivity.  Throughout the Executive’s employment hereunder, the
Executive shall devote substantially all of the Executive’s time, energy and
skill during regular business hours to the performance of the duties of the
Executive’s employment, shall faithfully and industriously perform such duties,
and shall diligently follow and implement all management policies and decisions
of the Company; provided, however, that this provision is not intended to
prevent the Executive from managing his investments, or engaging in other
activities outside of the Company, whether or not compensable, so long as he
gives his duties to the Company first priority and such activities do not
interfere with his performance of duties for the Company.  Notwithstanding the
foregoing, other than with regard to the Executive’s duties to the Company, the
Executive will not accept any other employment during the Term, perform any
consulting services during the Term, or serve on the board of directors or
governing body of any other business, except with the prior written consent of
the Board of Directors.  Further, the Executive has disclosed on Exhibit A
hereto, all of his nonpublic company bio-discovery related investments, and
agrees during the Term not to make any investments during the Term hereof except
as a passive investor.  The Executive agrees during the Term not to own directly
or indirectly equity securities of any public healthcare related company
(excluding the Company) that represents five percent (5%) or more of the value
of voting power of the equity securities of such company.
 

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2.            Compensation.
 
(a)           Base Salary.  The Company shall pay the Executive base salary of
$120,000.00 per annum (the “Annual Base Salary”), which base salary will be
subject to review effective at least annually thereafter by the Company for
possible increases. The base salary shall be payable in equal installments, no
less frequently than twice per month, in accordance with the Company’s regular
payroll practices.
 
(b)           Bonus.    Executive shall be eligible to receive annually a target
variable incentive bonus (the "Incentive Bonus") of one hundred percent (100%)
of Employee’s then current annual salary, based on objectives jointly determined
by Executive and the Chairman and CEO.  This Incentive Bonus is to be paid to
Executive no later than thirty (30) days following the closing of the Company’s
annual audited financial statements for services performed during each calendar
year subject to the Term(s) of this Agreement.  For his services performed in
calendar year ending 2009, the Incentive Bonus may be paid in cash, stock,
enhanced employee benefits or some combination thereof, based on the Company’s
preference and in accordance with law.  For subsequent calendar years, the
Incentive Bonus shall be payable in cash.
 
(c)           Equity Compensation.  The Executive shall receive options to
acquire shares of the Company’s Common Stock at an exercise price per share
equal to the greater of the Fair Market Value (as defined in the option
agreement referenced herein) of a share of the Company’s Common Stock or $0.08,
which shall vest pursuant to the vesting schedule set forth on Exhibit B hereto
and which grant shall be evidenced by an option agreement, the terms of which
are incorporated herein by reference, in form and substance reasonably
satisfactory to the Company and Executive.
 
(d)           Expenses.  The Executive shall be entitled to be reimbursed in
accordance with Company policy in effect for reasonable and necessary expenses
incurred by the Executive in connection with the performance of the Executive’s
duties of employment hereunder; provided, however, the Executive shall, as a
condition of such reimbursement, submit verification of the nature and amount of
such expenses in accordance with the reasonable reimbursement policies from time
to time adopted by the Company.  Any travel by Executive on behalf of the
Company shall be at the Company’s expense and shall include, but not be limited
to, all costs for the Executive’s transportation, lodging, meals, and with
respect to air fare at lowest available nonstop coach rates for domestic flights
and at lowest available nonstop business class rates for all international
flights.
 
(e)           Paid Time Off.  Executive shall be entitled to fifteen (15) paid
vacation days during the calendar year from January 1 to December 31. All
vacation must be taken by December 31 in the calendar year in which such
vacation is earned.
 
(f)            Benefits.
 
(i)          The Company shall at all times during the Term pay all premiums for
health insurance benefits for Executive and his dependants with coverage and
premiums available to other regular full-time employees of the Company;
provided, however, Executive shall be responsible for all deductibles,
co-payment requirements or similar obligations under such health insurance, and
provided, further, that the Company’s obligations under this Section 2(f)(i)
shall not exceed twenty percent (20%) of the Executive’s Annual Base Salary.
 
(ii)          In addition to the benefits payable to the Executive specifically
described herein, the Executive shall be entitled to such benefits as generally
may be made available to all other executives of the Company from time to time
as approved by the Board of Directors of the Company; provided, however, that
nothing contained herein shall require the establishment or continuation of any
particular plan or program; provided, further, that Executive shall be entitled
to participate in any stock option or other equity plan otherwise made available
to other executives of the Company.
 
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(g)           Director & Officer Insurance.  The Company, at its expense, shall
maintain director and officer insurance covering Executive at levels consistent
with past practice with a reputable carrier. The Executive shall be entitled to
indemnification, including advancement of expenses (if applicable), in
accordance with and to the fullest extent permitted by law, and as provided by
the Company’s bylaws and articles of incorporation, and any separate
indemnification agreement, if any.
 
(h)           Reimbursement Conditions.  All expenses eligible for reimbursement
under this Agreement must be incurred by the Executive during the Term of this
Agreement to be eligible for reimbursement. All reimbursements shall be paid as
soon as administratively practicable, but in no event shall any reimbursement be
paid after thirty days following the last day of the calendar year in which the
expense was incurred, nor shall the amount of reimbursable expenses incurred in
one taxable year affect the expenses eligible for reimbursement in any other
taxable year.

(i)           Withholding.  All payments pursuant to this Agreement shall be
reduced for any applicable state, local, or federal tax withholding obligations.
 
3.            Term, Termination and Termination Payments.
 
(a)           Term.  The term of this Agreement shall begin as of the Effective
Date.  It shall continue for a period of eighteen (18) months from the Effective
Date hereof or until sooner terminated pursuant to Section 3(b) hereof (the
“Initial Term”).  Thereafter, the employment term shall automatically renew and
continue for successive twelve (12) month periods (each a “Renewal Term”) unless
terminated pursuant to this Agreement or by either Party upon ninety (90)
calendar days’ written notice of intent not to renew this Agreement provided
prior to the expiration of the Initial Term or the then current Renewal Term, as
the case may be.  The Initial Term together with any Renewal Term(s) shall be
referred to herein as the “Term.”
 
(b)           Termination.  This Agreement and the employment of the Executive
by the Company hereunder shall only be terminated: (i) by expiration of the
Term; (ii) by the Company without Cause; (iii) by the Executive for Good Reason;
(iv) by the Company or the Executive due to the Disability of the Executive;
(v) by the Company for Cause; (vi) by the Executive for other than Good Reason
or Disability, upon at least ninety (90) days prior written notice to the
Company; or (vii) upon the death of the Executive.  Notice of termination by any
party shall be given prior to termination in writing and shall specify the basis
for termination and the effective date of termination.  Further, notice of
termination for Cause by the Company or Good Reason by the Executive shall
specify the facts alleged to constitute termination for Cause or Good Reason, as
applicable.  Except as provided in Section 3(c), the Executive shall not be
entitled to any payments or benefits after the effective date of the termination
of this Agreement, except for base salary pursuant to Section 2(a) accrued up to
the effective date of termination, any unpaid earned and accrued Incentive
Bonus, if any, pursuant to Section 2(b) (unless termination is by the Executive
prior to the end of the Term for other than Good Reason), pay for accrued but
unused vacation that the Company is legally obligated to pay Executive, if any,
and only if the Company is so obligated, as provided under the terms of any
other employee benefit and compensation agreements or plans applicable to the
Executive, expenses required to be reimbursed pursuant to Section 2(d), and any
rights to payment the Executive has under Section 2(g).
 
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(c)           Termination by the Company without Cause or by the Executive for
Good Reason.
 
(i)           If the employment of the Executive is terminated by the Company
without Cause or by the Executive for Good Reason and such termination
constitutes a Termination of Employment, the Company will pay the Executive (A)
such maximum Incentive Bonus to which Executive would have been entitled had
Executive remained in the employ of the Company the later of the entire calendar
year in which such termination occurs, or the end of the Term, (B) his base
salary pursuant to Section 2(a) hereof for the remainder of the Term  plus
ninety (90) days, and (C) an amount equal to the actual cost of ninety (90) days
of the Executive’s health insurance premiums pursuant to Section 2(f) hereof, or
if applicable, COBRA premium payments, commencing with the COBRA payment next
due after termination, should the Executive elect COBRA (the “Continuing
Benefit”).  Such amount shall be paid in arrears in substantially equal
installments not less frequently than monthly over the remainder of the Term
commencing within thirty (30) days following the effective date of termination;
provided, however, if the Executive is a “specified employee” within the meaning
of Section 409A of the Internal Revenue Code, as amended (the “Code”), at the
date of his Termination of Employment, then such portion of the payments that
would result in a tax under Code Section 409A if paid during the first six (6)
months after Termination of Employment shall be withheld, starting with the
payments latest in time during such six (6) month period, and paid to the
Executive during the seventh month following the date of his Termination of
Employment.  Notwithstanding the foregoing, if the total payments to be paid to
the Executive hereunder, along with any other payments to the Executive, would
result in the Executive being subject to the excise tax imposed by Code Section
4999, the Company shall reduce the aggregate payments to the largest amount
which can be paid to the Executive without triggering the excise tax, but only
if and to the extent that such reduction would result in the Executive retaining
larger aggregate after-tax payments.  The determination of the excise tax and
the aggregate after-tax payments to be received by the Executive will be made by
the Company.  If payments are to be reduced, the payments made latest in time
will be reduced first.
 
(ii)          If the original Term is not extended or the Company or the
Executive terminates the Executive’s employment in accordance with the Agreement
upon or following expiration of the Term, such termination shall not be deemed
in and of itself to be a termination of the Executive’s employment by the
Company without Cause or a resignation by Executive for Good Reason.
 
(iii)         Notwithstanding any other provision hereof, as a condition to the
payment of the amounts in this Section, the Executive shall be required to
execute and not revoke within the revocation period provided therein, the
Release.
 
(d)           Survival.  The covenants in this Section 3 hereof shall survive
the termination of this Agreement and shall not be extinguished thereby.
 
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4.            Ownership and Protection of Proprietary Information.
 
(a)           Confidentiality.  All Confidential Information and Trade Secrets
and all physical embodiments thereof received or developed by the Executive
while employed by the Company are confidential to and are and will remain the
sole and exclusive property of the Company.  Except to the extent necessary to
perform the duties assigned by the Company hereunder, the Executive will hold
such Confidential Information and Trade Secrets in trust and strictest
confidence, and will not use, reproduce, distribute, disclose or otherwise
disseminate the Confidential Information and Trade Secrets or any physical
embodiments thereof and may in no event take any action causing or fail to take
the action necessary in order to prevent, any Confidential Information and Trade
Secrets disclosed to or developed by the Executive to lose its character or
cease to qualify as Confidential Information or Trade Secrets.
 
(b)           Return of Company Property.  Upon request by the Company, and in
any event upon termination of this Agreement for any reason, as a prior
condition to receiving any final compensation hereunder (including any payments
pursuant to Section 3 hereof), the Executive will promptly deliver to the
Company all property belonging to the Company, including, without limitation,
all Confidential Information and Trade Secrets (and all embodiments thereof)
then in the Executive’s custody, control or possession.
 
(c)           Survival.  The covenants of confidentiality set forth herein will
apply on and after the date hereof to any Confidential Information and Trade
Secrets disclosed by the Company or developed by the Executive while employed or
engaged by the Company prior to or after the date hereof.  The covenants
restricting the use of Confidential Information will continue and be maintained
by the Executive for a period of two years following the termination of this
Agreement.  The covenants restricting the use of Trade Secrets will continue and
be maintained by the Executive following termination of this Agreement for so
long as permitted by the governing law.
 
5.            Non-Competition and Non-Solicitation Provisions.
 
(a)           The Executive agrees that during the Applicable Period, the
Executive will not (except on behalf of or with the prior written consent of the
Company, which consent may be withheld in Company’s sole discretion), within the
Area either directly or indirectly, on his own behalf, or in the service of or
on behalf of others, provide managerial services or management consulting
services substantially similar to those Executive provides for the Company to
any Competing Business.  The Executive acknowledges and agrees that the Business
of the Company is conducted in the Area.
 
(b)           The Executive agrees that during the Applicable Period, he will
not, either directly or indirectly, on his own behalf or in the service of or on
behalf of others solicit any individual or entity which is an actual or, to his
knowledge, actively sought prospective client of the Company or any of its
Affiliates (determined as of date of termination of employment) with whom he had
material contact while he was an Executive of the Company, for the purpose of
offering services substantially similar to those offered by the Company.
 
(c)           The Executive agrees that during the Applicable Period, he will
not, either directly or indirectly, on his own behalf or in the service of or on
behalf of others, solicit for employment with a Competing Business any person
who is a management level employee of the Company or an Affiliate with whom
Executive had contact during the last year of Executive’s employment with the
Company.  The Executive shall not be deemed to be in breach of this covenant
solely because an employer for whom he may perform services may solicit, divert,
or hire a management level employee of the Company or an Affiliate provided that
Executive does not engage in the activity proscribed by the preceding sentence.
 
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(d)           The Executive agrees that during the Applicable Period, he will
not make any statement (written or oral) that could reasonably be perceived as
disparaging to the Company or any person or entity that he reasonably should
know is an Affiliate of the Company.
 
(e)           In the event that this Section 5 is determined by a court which
has jurisdiction to be unenforceable in part or in whole, the court shall be
deemed to have the authority to strike any unenforceable provision, or any part
thereof or to revise any provision to the minimum extent necessary to be
enforceable to the maximum extent permitted by law.
 
(f)           The provisions of this Section 5 shall survive termination of this
Agreement.
 
6.            Remedies and Enforceability.
 
The Executive agrees that the covenants, agreements, and representations
contained in Sections 4 and 5 hereof are of the essence of this Agreement; that
each of such covenants are reasonable and necessary to protect and preserve the
interests and properties of the Company; that irreparable loss and damage will
be suffered by the Company should the Executive breach any of such covenants and
agreements; that each of such covenants and agreements is separate, distinct and
severable not only from the other of such covenants and agreements but also from
the other and remaining provisions of this Agreement; that the unenforceability
of any such covenant or agreement shall not affect the validity or
enforceability of any other such covenant or agreements or any other provision
or provisions of this Agreement; and that, in addition to other remedies
available to it, including, without limitation, termination of the Executive’s
employment for Cause, the Company shall be entitled to seek both temporary and
permanent injunctions to prevent a breach or contemplated breach by the
Executive of any of such covenants or agreements.
 
7.            Notice.
 
All notices, requests, demands and other communications required hereunder shall
be in writing and shall be deemed to have been duly given if delivered or if
mailed, by United States certified or registered mail, prepaid to the party to
which the same is directed at the following addresses (or at such other
addresses as shall be given in writing by the parties to one another):
 
If to the Company:
 
2 East Bryan Street, Suite 601
Savannah, GA 31401

If to the Executive:
 
2 Jessamine Lane
Savannah, GA 31411

Notices delivered in person shall be effective on the date of delivery.  Notices
delivered by mail as aforesaid shall be effective upon the fourth calendar day
subsequent to the postmark date thereof.
 
8.            Miscellaneous.
 
(a)           Assignment.  The rights and obligations of the Company under this
Agreement shall inure to the benefit of the Company’s successors and
assigns.  This Agreement may be assigned by the Company to any legal successor
to the Company’s business or to an entity that purchases all or substantially
all of the assets of the Company, but not otherwise without the prior written
consent of the Executive.  In the event the Company assigns this Agreement as
permitted by this Agreement and the Executive remains employed by the assignee,
the “Company” as defined herein will refer to the assignee and the Executive
will not be deemed to have terminated his employment hereunder until the
Executive terminates his employment with the assignee.  The Executive may not
assign this Agreement.
 
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(b)           Waiver.  The waiver of any breach of this Agreement by any party
shall not be effective unless in writing, and no such waiver shall constitute
the waiver of the same or another breach on a subsequent occasion.
 
(c)           Governing Law.  This Agreement shall be governed by and construed
in accordance with the internal laws of the State of Georgia.  The parties agree
that any appropriate state or federal court located in Chatham County, Georgia
shall have jurisdiction of any case or controversy arising under or in
connection with this Agreement and shall be a proper forum in which to
adjudicate such case or controversy.  The parties consent to the jurisdiction of
such courts.
 
(d)           Entire Agreement.  This Agreement and other agreements referenced
herein embody the entire agreement of the parties hereto relating to the subject
matter hereof and supersede all oral agreements, and to the extent inconsistent
with the terms hereof, all other written agreements.
 
(e)           Amendment.  This Agreement may not be modified, amended,
supplemented or terminated except by a written instrument executed by the
parties hereto.
 
(f)           Severability.  Each of the covenants and agreements hereinabove
contained shall be deemed separate, severable and independent covenants, and in
the event that any covenant shall be declared invalid by any court of competent
jurisdiction, such invalidity shall not in any manner affect or impair the
validity or enforceability of any other part or provision of such covenant or of
any other covenant contained herein.
 
(g)           Captions and Section Headings.  Except as set forth in Section 9
hereof, captions and section headings used herein are for convenience only and
are not a part of this Agreement and shall not be used in construing it.
 
(h)           Dispute Resolution.  If a dispute arises between Company and
Executive regarding the interpretation of this Agreement, the parties agree to
negotiate in good faith regarding a resolution of the issues involved for at
least thirty days prior to either party initiating proceedings to enforce their
rights. Within sixty (60) days after a final determination (excluding any
appeals) is made with respect to the proceedings, unless the parties agree
otherwise, the losing party will reimburse the winning party’s reasonable
attorney’s fees and costs incurred in the litigation. ALL DISPUTES ARISING OUT
OF OR RELATED TO THIS AGREEMENT OR TO COMPANY’S EMPLOYMENT OF EXECUTIVE OR THE
TERMINATION OF EXECUTIVE’S EMPLOYMENT SHALL BE SUBMITTED EXCLUSIVELY TO BINDING
ARBITRATION IN SAVANNAH, GEORGIA, PURSUANT TO THE NATIONAL RULES FOR THE
RESOLUTION OF EMPLOYMENT DISPUTES OF THE AMERICAN ARBITRATION ASSOCIATION,
provided however that Company shall be entitled to injunctive relief from any
court of jurisdiction against Executive’s breach of any covenant in Articles 4
and 5, and further provided that this Agreement shall not require arbitration of
any claim for workers’ compensation benefits or any claim for unemployment
compensation. Executive understands that agreeing to arbitration waives the
right to a jury trial. Arbitral awards shall be enforceable by any court of
competent jurisdiction.
 
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9.            Definitions.
 
(a)           “Affiliate” means any person, firm, corporation, partnership,
association or entity that, directly or indirectly or through one or more
intermediaries, controls, is controlled by or is under common control with the
Company.
 
(b)           “Applicable Period” means the period commencing as of the date of
this Agreement and ending twelve months after the termination of the Executive’s
employment with the Company or any of its Affiliates.
 
(c)           “Area” means the United States.
 
(d)           “Business of the Company” means any business that uses or provides
consulting services related to support vector machines or fractal genomic
modeling.
 
(e)           “Cause” the occurrence of any of the following events:
 
(i)          willful failure or refusal to perform the duties as set forth in
Section 1(a) as determined by the Board of Directors or implement a directive
from the Board of Directors, in each case remaining uncured for a period of
fourteen (14) days after receipt of written notice from the Board of Directors
specifying such failure or refusal;
 
(ii)          intentional disclosure by the Executive to an unauthorized person
of Confidential Information or Trade Secrets, which causes material harm to the
Company;
 
(iii)          any act by the Executive of fraud against, material
misappropriation from, or significant dishonesty to either the Company or an
Affiliate, or any other party, but in the latter case only if in the reasonable
opinion of at least two-thirds of the members of the Board of Directors of the
Company (excluding the Executive), such fraud, material misappropriation, or
significant dishonesty could reasonably be expected to have a material adverse
impact on the Company or its Affiliates;
 
(iv)          conviction of, or plea of nolo contendere to, a felony which
adversely and materially affects the Company; or
 
(v)          a material breach of this Agreement by the Executive, provided that
the nature of such breach shall be set forth with reasonable particularity in a
written notice to the Executive who shall have ten (10) days following delivery
of such notice to cure such alleged breach, provided that such breach is, in the
reasonable discretion of the Board of Directors, susceptible to a cure.
 
(f)           “Competing Business” means the entities listed below and any
person, firm, corporation, joint venture, or other business that is engaged in
the Business of the Company:
 
(g)           “Confidential Information” means data and information relating to
the Business of the Company or an Affiliate (which does not rise to the status
of a Trade Secret) which is or has been disclosed to the Executive or of which
the Executive became aware as a consequence of or through his relationship to
the Company or an Affiliate and which has value to the Company or an Affiliate
and is not generally known to its competitors.  Confidential Information shall
not include any data or information that has been voluntarily disclosed to the
public by the Company or an Affiliate (except where such public disclosure has
been made by the Executive without authorization) or that has been independently
developed and disclosed by others, or that otherwise enters the public domain
through lawful means without breach of any obligations of confidentiality owed
to the Company or any of its Affiliates by the Executive.
 
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(h)           “Disability” means the inability of the Executive to perform the
material duties of his position hereunder due to a physical, mental, or
emotional impairment, for a ninety (90) consecutive day period or for aggregate
of one hundred eighty (180) days during any three hundred sixty-five (365) day
period.
 
(i)           “Good Reason” means the occurrence of any of the events listed in
either (i), (ii) or (iii) below:
 
(i)           (A)          the Company materially breaches this Agreement,
including without limitation, a material diminution of the Executive’s
responsibilities as President and General Counsel, as reasonably modified by the
Board of Directors from time to time hereafter, such that the Executive would no
longer have responsibilities substantially equivalent to those of other
presidents and general counsels at companies with similar revenues and market
capitalization;
 
  (B)          the Executive gives written notice to the Company of the facts
and circumstances constituting the breach of the Agreement within ten (10) days
following the occurrence of the breach;
 
  (C)           the Company fails to remedy the breach within ten (10) days
following the Executive’s written notice of the breach; and
 
  (D)           the Executive terminates his employment within ten (10) days
following the Company’s failure to remedy the breach; or
 
(ii)         (A)           the Company requires the Executive to relocate the
Executive’s primary place of employment to a new location, that is more than
fifty (50) miles (calculated using the most direct driving route) from its
current location, without the Executive’s consent;
 
  (B)           the Executive gives written notice to the Company within ten
(10) days following receipt of notice of relocation of his objection to the
relocation;
 
  (C)           the Company fails to rescind the notice of relocation within ten
(10) days following the Executive’s written notice; and
 
  (D)           the Executive terminates his employment within ten (10) days
following the Company’s failure to rescind the notice.
 
(j)           “Release” means a comprehensive release, covenant not to sue, and
non-disparagement agreement from the Executive in favor of the Company, its
executives, officers, directors, Affiliates, and all related parties, in the
form attached hereto as Exhibit C.
 
(k)            “Term” has the meaning as set forth in Section 3(a) hereof.
 
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(l)           “Termination of Employment” means either that (a) the Executive
has ceased to perform any services for the Company and all affiliated companies
that, together with the Company, constitute the “service recipient” within the
meaning of Section 409A of the Code and the regulations thereunder
(collectively, the “Service Recipient”) or (b) the level of bona fide services
the Executive performs for the Service Recipient after a given date (whether as
an employee or as an independent contractor) permanently decreases (excluding a
decrease as a result of military leave, sick leave, or other bona fide leave of
absence if the period of such leave does not exceed six months, or if longer, so
long as the Executive retains a right to reemployment with the Service Recipient
under an applicable statute or by contract) to no more than twenty percent (20%)
of the average level of bona fide services performed for the Service Recipient
(whether as an employee or an independent contractor) over the immediately
preceding 36-month period.

(m)           “Trade Secrets” means data and information relating to the
Business of the Company or an Affiliate including, but not limited to, technical
or nontechnical data, formulae, patterns, compilations, programs, devices,
methods, techniques, drawings, processes, financial data, financial plans,
product plans or lists of actual or potential customers or suppliers which
(i) derives economic value, actual or potential, from not being generally known
to, and not being readily ascertainable by proper means by, other persons who
can obtain economic value from its disclosure or use, and (ii) is the subject of
efforts that are reasonable under the circumstances to maintain its secrecy.
 
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IN WITNESS WHEREOF, the Company and the Executive have each executed and
delivered this Agreement as of the date first shown above.
 

 
COMPANY:
           
Health Discovery Corporation
                   
By:
/s/ Stephen D. Barnhill      
Stephen D. Barnhill, Chairman and CEO
                 
THE EXECUTIVE:
                    /s/ R. Scott Tobin    
R. Scott Tobin
 

 

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EXHIBIT A

None
     

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EXHIBIT B

Vesting Date
 
Number of Options
April 15, 2009
 
1,000,000
January 1, 2010
 
1,500,000
September 15, 2010
 
2,000,000

Each portion of the option identified under the “Number of Options” column above
shall vest only if and when (1) the Executive has been continuously employed by
the Company through the applicable Vesting Date,  and (2) with respect to the
options that have Vesting Dates of January 1 and September 15, 2010 the options
shall not vest until either the Company has (i) cash on hand in excess of
$800,000, or (ii) a positive, trailing 90-day EBITDA, or (iii) raised an
additional $1,000,000 in capital from new investments, excluding any proceeds
from the exercise of any warrants or options.

Notwithstanding the foregoing, in the event of either (i) a termination of
Executive by the Company without Cause or by the Executive for Good Reason, or
(ii) a Change in Control occurs while the Executive is employed by the Company,
the Executive shall immediately become fully vested in all of the above
referenced option shares (as adjusted for any changes in capitalization as
provided in any applicable option agreement), provided that upon a Change of
Control the per share consideration received by shareholders of the Company on
account of the Change in Control is equal to or greater than $0.10 per share of
Common Stock (as adjusted for changes in capitalization as provided in any
applicable option agreement).  Change in Control” means the consummation of (i)
a merger, consolidation, share exchange, combination, reorganization, or like
transaction involving the Company in which the shareholders of the Company
immediately prior to such transaction do not own at least fifty percent (50%) of
the value or voting power of the issued and outstanding capital stock of the
Company or its successor immediately after such transaction, or (ii) the sale or
transfer (other than as security for the Company's obligations) of all or
substantially all of the assets of the Company in any transaction or a series of
related transactions, in which the Company, any corporation controlled by the
Company, or the shareholders of the Company immediately prior to the transaction
do not own at least fifty percent (50%) of the value or voting power of the
issued and outstanding equity securities of the acquirer immediately after the
transaction.
 

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EXHIBIT C

RELEASE, AGREEMENT PURSUANT TO
EMPLOYMENT AGREEMENT

This Agreement (this “Agreement”) is made this ___ day of _____, 200_, by
_______________ (the “Employer”) and ________________ (the “Employee”).

Introduction

Employee and the Employer entered into an Employment Agreement dated ________,
200_ (the “Employment Agreement”).

The Employment Agreement requires that as a condition to the Employer’s
obligation to pay payments and benefits under Section 3(c) of the Employment
Agreement (the “Severance Benefits”), Employee must provide a release and agree
to certain other conditions as provided herein.

NOW, THEREFORE, the parties agree as follows:

1.
Employee has been offered twenty-one (21) days from receipt of this Agreement
within which to consider this Agreement. The effective date of this Agreement
shall be the date eight (8) days after the date on which Employee signs this
Agreement (“the Effective Date”). For a period of seven (7) days following
Employee’s execution of this Agreement, Employee may revoke this Agreement, and
this Agreement shall not become effective or enforceable until such seven (7)
day period has expired. Employee must communicate the desire to revoke this
Agreement in writing.  Employee understands that he or she may sign the
Agreement at any time before the expiration of the twenty-one (21) day review
period.  To the degree Employee chooses not to wait twenty-one (21) days to
execute this Agreement, it is because Employee freely and unilaterally chooses
to execute this Agreement before that time.  Employee’s signing of the Agreement
triggers the commencement of the seven (7) day revocation period.
   
2.
In exchange for Employee’s execution of this Agreement and in full and complete
settlement of any claims as specifically provided in this Agreement, the
Employer will provide Employee with the Severance Benefits.
   
3.
Employee acknowledges and agrees that this Agreement is in compliance with the
Age Discrimination in Employment Act and the Older Workers Benefit Protection
Act and that the releases set forth in this Agreement shall be applicable,
without limitation, to any claims brought under these Acts.
     
The release given by Employee in this Agreement is given solely in exchange for
the consideration set forth in Section 2 of  this Agreement and such
consideration is in addition to anything of value that Employee was entitled to
receive prior to entering into this Agreement.
     
Employee has been advised to consult an attorney prior to entering into this
Agreement and this provision of the Agreement satisfies the requirement of the
Older Workers Benefit Protection Act that Employee be so advised in writing.
     
By entering into this Agreement, Employee does not waive any rights or claims
that may arise after the date this Agreement is executed.

 

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4.
This Agreement shall in no way be construed as an admission by the Employer that
it has acted wrongfully with respect to Employee or any other person or that
Employee has any rights whatsoever against the Employer.  The Employer
specifically disclaims any liability to or wrongful acts against Employee or any
other person on the part of itself, its employees or its agents.
   
5.
As a material inducement to the Employer to enter into this Agreement, Employee
hereby irrevocably releases the Employer and each of the owners, stockholders,
predecessors, successors, directors, officers, employees, representatives,
attorneys, affiliates (and agents, directors, officers, employees,
representatives and attorneys of such affiliates) of the Employer and all
persons acting by, through, under or in concert with them (collectively, the
“Releasees”), from any and all charges, claims, liabilities, agreements,
damages, causes of action, suits, costs, losses, debts and expenses (including
attorneys’ fees and costs actually incurred) of any nature whatsoever, known or
unknown, including, but not limited to, rights arising out of alleged violations
of any contracts, express or implied, any covenant of good faith and fair
dealing, express or implied, or any tort, or any legal restrictions on the
Employer’s right to terminate employees, or any federal, state or other
governmental statute, regulation, or ordinance, including, without limitation:
(1) Title VII of the Civil Rights Act of 1964, as amended by the Civil Rights
Act of 1991 (race, color, religion, sex, and national origin discrimination);
(2) the Employee Retirement Income Security Act (“ERISA”); (3) 42 U.S.C. § 1981
(discrimination); (4) the Americans with Disabilities Act (disability
discrimination); (5) the Equal Pay Act; (6) the Age Discrimination in Employment
Act; (7) the Older Workers Benefit Protection Act;  (6) Executive Order 11246
(race, color, religion, sex, and national origin discrimination); (7) Executive
Order 11141 (age discrimination); (8) Section 503 of the Rehabilitation Act of
1973 (disability discrimination); (9) negligence; (10) negligent hiring and/or
negligent retention; (11) intentional or negligent infliction of emotional
distress or outrage; (12) defamation; (13) interference with employment;
(14) wrongful discharge; (15) invasion of privacy; or (16) violation of any
other legal or contractual duty arising under the laws of the State of Maryland
or the laws of the United States (“Claim” or “Claims”), which Employee now has,
or claims to have, or which Employee at any time heretofore had, or claimed to
have, or which Employee at any time hereinafter may have, or claim to have,
against each or any of the Releasees, in each case as to acts or omissions by
each or any of the Releasees occurring up to and including the Effective Date.
   
6.
The release in the preceding paragraph of this Agreement does not apply to
(a) all benefits and awards (including without limitation cash and stock
components) which pursuant to the terms of any compensation or benefit plans,
programs, or agreements of the Employer are earned or become payable, but which
have not yet been paid, and (b) pay for accrued but unused vacation that the
Employer is legally obligated to pay Employee, if any, and only if the Employer
is so obligated, (c) unreimbursed business expenses for which Employee is
entitled to reimbursement under the Employer’s policies, and (d) any rights to
indemnification that Employee has under any directors and officers or other
insurance policy the Employer maintains or under the bylaws and articles of
incorporation of the Company, and under any indemnification agreement, if any.
   
7.
Employee promises that he will not make statements disparaging to any of the
Releasees.  Employee agrees not to make any statements about any of the
Releasees to the press (including without limitation any newspaper, magazine,
radio station or television station) without the prior written consent of the
Employer.  The obligations set forth in the two immediately preceding sentences
will expire two years after the Effective Date.  Employee will also cooperate
with the Employer and its affiliates if the Employer requests Employee’s
testimony.  To the extent practicable and within the control of the Employer,
the Employer will use reasonable efforts to schedule the timing of Employee’s
participation in any such witness activities in a reasonable manner to take into
account Employee’s then current employment, and will pay the reasonable
documented out-of-pocket expenses that the Employer pre-approves and that
Employee incurs for travel required by the Employer with respect to those
activities.

 
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9.
Except as set forth in this Section, Employee agrees not to disclose the
existence or terms of this Agreement to anyone.  However, Employee may disclose
it to a member of his immediate family or legal or financial advisors if
necessary and on the condition that the family member or advisor similarly does
not disclose these terms to anyone.  Employee understands that he will be
responsible for any disclosure by a family member or advisor as if he had
disclosed it himself.  This restriction does not prohibit Employee’s disclosure
of this Agreement or its terms to the extent necessary during a legal action to
enforce this Agreement or to the extent Employee is legally compelled to make a
disclosure.  However, Employee will notify the Employer promptly upon becoming
aware of that legal necessity and provide it with reasonable details of that
legal necessity.
   
10.
Employee has not filed or caused to be filed any lawsuit, complaint or charge
with respect to any Claim he releases in this Agreement.  Employee promises
never to file or pursue a lawsuit, complaint or charge based on any Claim
released by this Agreement, except that Employee may participate in an
investigation or proceeding conducted by an agency of the United States
Government or of any state.  Employee also has not assigned or transferred any
claim he is releasing, nor has he purported to do so.
   
11.
The Employer and Employee agree that the terms of this Agreement shall be final
and binding and that this Agreement shall be interpreted, enforced and governed
under the laws of the State of Maryland.  The provisions of this Agreement can
be severed, and if any part of this Agreement is found to be unenforceable, the
remainder of this Agreement will continue to be valid and effective.
   
12.
This Agreement sets forth the entire agreement between the Employer and Employee
and fully supersedes any and all prior agreements or understandings, written
and/or oral, between the Employer and Employee pertaining to the subject matter
of this Agreement.
   
13.
Employee is solely responsible for the payment of any fees incurred as the
result of an attorney reviewing this agreement on behalf of Employee.  In any
litigation concerning the validity or enforceability of this contract or in any
litigation to enforce the provisions of this contract, the prevailing party
shall be entitled to recover reasonable attorneys’ fees and costs, including
court costs and expert witness fees and costs.

 
Employee’s signature below indicates Employee’s understanding and agreement with
all of the terms in this Agreement.
 
Employee should take this Agreement home and carefully consider all of its
provisions before signing it. Employee may take up to twenty-one (21) days to
decide whether Employee wants to accept and sign this Agreement.  Also, if
Employee signs this Agreement, Employee will then have an additional seven (7)
days in which to revoke Employee’s acceptance of this Agreement after Employee
has signed it.  This Agreement will not be effective or enforceable, nor will
any consideration be paid, until after the seven (7) day revocation period has
expired. Again, Employee is free and encouraged to discuss the contents and
advisability of signing this Agreement with an attorney of Employee’s choosing.
 
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Employee should read carefully.  This agreement includes a release of all known
and unknown claims through the effective date.  Employee is strongly advised to
consult with an attorney before executing this document.

IN WITNESS WHEREOF, Employee and the Employer have executed this agreement
effective as of the date first written above.

  EMPLOYEE                  
Name
                 
Date Signed
                    EMPLOYER:                    
By:
             
Title:
   

 
 
 
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