Filed by sedaredgar.com -  Response Biomedical Corp. - Exhibit 4.12






EMPLOYMENT AGREEMENT 

THIS EMPLOYMENT AGREEMENT is made as of the 1st day of
February, 2007. 

BETWEEN: 

Duane Morris of 4125 232 Ave.
SE, Sammamish, Washington, USA 
(the “Employee”) 

RESPONSE BIOMEDICAL
CORPORATION, a 
Corporation with its principal place of business at

100-8900 Glenlyon Parkway, Burnaby, British Columbia, V5J 5J8 
(the
“Company”). 

WHEREAS: 

	A. 	
      The Company is engaged in research, development and
      commercialization of diagnostic technologies for the medical point of care
      and on-site environmental testing markets.

	 	 
	B. 	
      The parties wish to record the terms and conditions of
      the Employee’s consultation with the Company (the “Agreement”) via the
      employment of the Employee by the Company or a U.S. subsidiary of the
      Company.



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

	1. 	EMPLOYMENT 
	  	  
	1. 1 	
      Position. Subject to the terms of this Agreement,
      the Company agrees to employ the Employee and the Employee agrees to serve
      the Company as Chief Operating Officer, during the Term (hereinafter
      defined). At the election of the Company, the Employee agrees to have all
      terms and conditions of this Agreement transferred to a subsidiary company
      of the Company. 

	  	
       

	1. 2 	
      Reporting. The Employee shall report and be
      directly responsible to the Chief Executive Officer or such other person
      as may be selected by the Board of Directors of the Company. 

	  	
       

	1. 3 	
      Work Permits. The Company and Employee acknowledge
      that he will be working for the Company or for a U.S . subsidiary of the
      Company, but that many of the services of employment will be rendered in
      Canada. If Employee spends greater than 180 days per year providing
      services in Canada, then the parties agree it is the Employee’s sole
    







2

		
      responsibility to secure all required work permits or
      other documentation that may be required for the Employee to work in
      Canada for such a period beyond the specified number of days per year. The
      Company agrees, where practical, to assist the Employee to secure all
      required work permits or other documentation that may be required for the
      Employee to work in Canada. Further, the Company shall reimburse Employee
      for any income tax differences between the United States and Canada that
      are levied on the Employee as a result of his working in Canada (if, for
      example, he exceeds the number of days per year allowed to work in Canada
      without being subject to Canadian taxes) so that Employee will pay no more
      income taxes on his total annual cash compensation as a result of this
      working arrangement, than he would have paid if working entirely in the
      United States. 

	  	
       

	1. 4 	
      Term. The term of this Agreement shall commence on
      February 1, 2007 (the “Effective Date”) and will continue until this
      Agreement is terminated as provided herein (the “Term”). 

	  	
       

	2. 	
      COMPENSATION 

	  	
       

	2. 1 	
      Salary . The Employee shall be paid an annual
      salary in the amount of U.S. $200,000 for the Employee’s services
      (the “Salary”), payable semi-monthly in arrears. The Salary has been set
      at a level that takes into account all potential hours of work. 

	  	
       

	2. 2 	
      Incentive Programs. The Employee shall be eligible
      to participate in any incentive program that is applicable to senior
      managers of the Company, including the Company’s Short-Term Incentive
      Plan, on terms and conditions for such participation as established and
      changed from time to time by the Company in its sole discretion .
      Currently, the Company expects the Employee to be eligible for an annual
      cash bonus of up to twenty five percent (25%) of his annual salary.
  

	  	
       

	2. 3 	
      Employee Stock Option Plan. The Employee shall be
      entitled to purchase up to five hundred thousand (500,000) shares of the
      Company in accordance with the Company’s Policy for Stock Option
      Granting and Vesting Policy and Procedure . The Employee acknowledges
      that the Policy for Stock Option Granting and Vesting Policy and
      Procedure may be amended, modified or terminated from time to time by
      the Company in its sole discretion . In addition, the Employee shall be
      entitled to purchase five hundred thousand (500,000) additional shares
      under said Policy, but the vesting on said additional shares shall be a
      single “cliff vest” of the entire amount to occur on the 5 year
      anniversary of the Effective Date of this Agreement. Per said Policy, all
      1 million (1,000,000) options to purchase shares will vest upon a Change
      of Control. The parties agree that the grant date of the options shall be
      as soon as the Board can reasonably grant the options. It is the
      expectation of the parties that this will occur within several days of the
      Effective Date, and the Employee will not need to wait the three (3)
      months referred to in the Policy. 

	  	
       

	2. 4 	
      Benefits. The Company will make all employee
      benefit programs maintained by the Company available to the Employee upon
      completion of any applicable waiting period imposed by the Company or
      third party benefit providers. The terms and conditions of the benefit
      programs will be determined by the plans or policies from time to time
      established or purchased by the Company. The Company retains the right to
      establish new benefit programs and to alter or delete benefit programs at
      any time in its sole 







3

		
      discretion . In addition to the standard benefit program,
      the Company shall provide temporary housing to the Employee to cover the
      period from the Effective Date through to the end of March 2007.


	  	
       

	2. 5 	
      Vacation . The Employee shall be entitled to
      twenty (20) business days of paid vacation per annum, pro-rated for
      any partial year, in accordance with the Company’s Vacation Policy.
      The Employee acknowledges that the Vacation Policy may be amended,
      modified or terminated from time to time by the Company in its sole
      discretion . The Employee’s vacation will be scheduled at such time or
      times as mutually agreed by the Company and the Employee . If the Company
      and the Employee are unable to agree to the scheduling of the Employee’s
      vacation, the Employee acknowledges that the Company will be entitled to
      schedule the Employee’s vacation time or times. 

	  	
       

	2. 6 	
      Automobile Allowance . The Company will pay the
      Employee a total of U.S. five hundred dollars ($500) per month for
      expenditures associated with the Employee commuting from Washington State
      to British Columbia. Any costs in excess of said amount shall be borne by
      the Employee . 

	  	
       

	2. 7 	
      No Other Compensation or Benefits. The Employee
      acknowledges and agrees that unless otherwise expressly agreed to in
      writing by the Company subsequent to execution of this Agreement by the
      parties hereto, the Employee shall not be entitled by reason of his
      employment by the Company or by reason of any termination of such
      employment, to any remuneration, compensation or benefits other than as
      expressly set forth in this Agreement, including the rights under Article
      5. 

	  	 
	3. 	OBLIGATIONS OF THE EMPLOYEE
  



	
      3. 1 
	
      Duties. The Employee shall act as Chief Operating
      Officer and shall perform such duties as are consistent with that
      position. In addition, the Employee shall perform, observe and conform to
      such duties and instructions as from time to time are assigned or
      communicated to the Employee by the Board of Directors, the Chief
      Executive Officer and/or the President of the Company.





	
      3. 2 
	
      Service to the Company . At all times while
      employed by the Company, the Employee will use his best efforts to:
  




	 	(a) 	
      well and faithfully serve the Company;

	 	 	 
	 	(b) 	
      act in, and promote, the best interests of the
      Company;

	 	 	 
	 	(c) 	
      devote substantially the whole of the Employee’s working
      time, attention and energies to the business and affairs of the
      Company;

	 	 	 
	 	(d) 	
      comply with all terms of this Agreement and any other
      Agreements entered into with the Company; and

	 	 	 
	 	(e) 	
      comply with all rules, regulations, policies and
      procedures of the Company.




	3. 3 	
      Competition. The Employee acknowledges that the
      Company has operated and will 







4

		
      continue to operate and compete in a global and
      competitive market. During the course of the Employee’s employment with
      the Company, the Employee will acquire knowledge and will come into
      contact with, initiate relationship with regulatory officials, government
      representatives, suppliers, principals, contractors, contacts and other
      prospects of the Company. The Employee agrees that the Employee will not,
      either alone or in partnership or in conjunction with any person, firm
      company, corporation, partnership, trust, syndicate, unincorporated
      association, governmental body or any other entity or group, whether as
      principal, agent, employee, director, officer, shareholder, consultant, or
      in any capacity or manner whatsoever, whether directly or indirectly,
      during his employment with the Company carry on or be engaged in, or
      advise, invest in or give financial assistance to any business, enterprise
      or undertaking that is involved in a business that is competitive with or
      similar to the Company or any product or service of the Company, provided
      however, that the foregoing will not prohibit the Employee from acquiring,
      solely as an investment and through market purchases, securities of any
      such enterprise or undertaking which are publicly traded. 

	  	
       

	3. 4 	
      Conflicts of Interest. During the Employee’s
      employment with the Company, the Employee shall not, without the Company’s
      consent, hold any office, acquire any property or enter into any contract,
      arrangement, understanding or transaction with any other person or entity
      that would in any way conflict or interfere with this Agreement or the
      Employee’s duties and obligations under this Agreement or that would
      otherwise prevent the Employee from performing his/her duties hereunder.
      The Employee represents and warrants that the Employee does not hold any
      such office, has not acquired any such property and has not entered into
      any such contract, arrangement, understanding or transaction . 

	  	
       

	3. 5 	
      Confidentiality. Concurrently with execution and
      delivery of this Agreement and in consideration of the Employee’s
      employment by the Company, the Employee will enter into a Confidentiality
      Agreement preserving the confidentiality of Company information.


	  	
       

	4. 	
      TERMINATION 

	  	
       

	4. 1 	
      Termination during Probation Period . There will
      be a probation period of three months (the “Probation Period”) commencing
      on the Effective Date during which the Employee will be assessed by the
      Company for the position of Chief Operating Officer. The Company may,
      prior to the end of the Probation Period, terminate the Employee’s
      employment with or without just cause and without notice to the Employee .
      

	  	
       

	4. 2 	
      Termination after Probation Period. Other than
      under a Change of Control (defined below), upon completion of the
      Probation Period, the Company may terminate the Employee’s employment at
      any time during the Term. If Company terminates the Employee “With Cause”
      then the Company shall pay the Employee 1 month severance payment and
      provide the Employee with the reasons that this Agreement is being
      terminated With Cause. With Cause shall include repeated failure of the
      Employee to perform his duties in accordance with the expected standards,
      insubordination, fraud or other illegal activities that have a direct
      bearing or result from work actually performed on behalf of the Company,
      and/or repeated failure to adhere to the Company’s policies and procedures
      after receiving at least one written warning . 

	  	
       

	  	
      The Company may also terminate the Employee’s termination
      “Without Cause .” In 







5

		
      such an instance, the Company will pay the Employee a
      lump sum payment equal to six months salary plus two additional months of
      salary for each year the Employee has been employed by the Company up to a
      maximum of eighteen (18) months. 

	  	
       

	4. 3 	
      Change of Control. If the Company undergoes a
      Change of Control (“Change of Control” to mean a material change in the
      ownership of 51% or more of the issued share capital, voting securities or
      other equity interest of the Company by a company or companies or group of
      persons acting as a single entity to gain the legal power to direct or
      cause the direction of the Company), then within thirty (30) days of said
      Change of Control, the Employee shall be entitled to voluntarily terminate
      this Agreement and his employment with the Company by providing a written
      notice to the Company. To ensure an orderly transition, the termination
      and end of employment will be effective in six (6) months from the date of
      termination, or earlier if agreed to in writing by the acquiring company.
      In such a case, the Employee shall be paid and continue to be employed for
      said six (6) months and then he will be entitled to twenty four (24)
      months of severance payment in a lump sum; provided, however, that such
      Change of Control does not occur within the first twelve (12) months of
      the Effective Date of this Agreement. If the Change of Control occurs
      within the first twelve (12) of the Effective Date, then the Employee
      shall be entitled to thirty six (36) months of severance, which shall be
      reduced by one month for each month that this Agreement has been in effect
      (i.e . if this Agreement has been in effect for 1 month, then Employee
      shall receive 35 months of severance, if the Agreement has been in effect
      for 6 months, then Employee shall receive 30 months of severance and so
      on). 

	  	
       

		
      a) In the event that any compensation paid to Employee
      for your benefit by the Company in respect of the Change of Control would
      be subject to the excise tax imposed by Section 4999 if the Internal
      Revenue Code of 1986, as amended, or any comparable federal, state, or
      local excise tax (the Excise Tax), the Company will make an additional
      payment to Employee so that the net amount received and retained by
      Employee from the Company after satisfaction of the Excise Tax shall the
      same amount as if no Excise Tax were imposed. 

	  	
       

	5. 	
      MISCELLANEOUS 

	  	
       

	5. 1 	
      This Agreement shall be governed by, and interpreted in
      accordance with, the laws of British Columbia and the laws of Canada
      applicable therein and the parties hereto agree to the exclusive
      jurisdiction of the courts of the Province of British Columbia. 

	  	
       

	5. 2 	
      The Employee acknowledges that the Company will collect,
      use and disclose personal information only where reasonably necessary for
      security, employment and business purposes. The Employee consents to the
      Company collecting, using and disclosing personal information about the
      Employee only where reasonably necessary for security, employment and
      business purposes in accordance with applicable legislation and any
      privacy policy of the Company that may be in effect from time to time.
    

	  	
       

	5. 3 	
      This Agreement shall binding upon and enure to the
      benefit of the Company and its successors and assigns. The Employee’s
      rights and obligations contained in this Agreement are personal and such
      rights, benefits and obligations shall not be voluntarily or involuntarily
      assigned, alienated or transferred, whether by operations of law or
      otherwise, without the prior written consent of the Company.
  







6

	5. 4 	
      Any waiver of any breach or default under this Agreement
      shall only be effective if in writing signed by the party against whom the
      waiver is sought to be enforced, and no waiver shall be implied by any
      other act or conduct or by any indulgence, delay or omission . Any waiver
      shall only apply to the specific matter waived and only in the specific
      instance in which it is waived . 

	  	
       

	5. 5 	
      The parties will execute and deliver to each other such
      further instruments and assurances and do such further acts as may be
      required to give effect to this Agreement. 

	  	
       

	5. 6 	
      If any provision of this Agreement or any part thereof
      shall for any reason be held to be invalid or unenforceable in any
      respect, then such invalid or unenforceable provision or part shall be
      severable and severed from this Agreement and the other provisions of this
      Agreement shall remain in effect and be constructed as if such invalid or
      unenforceable provision or part had never been contained herein .
  

	  	
       

	5. 7 	
      Both parties shall keep the terms and conditions of this
      Agreement confidential except as may be required to enforce any provisions
      of this Agreement or as may otherwise be required by any law, regulation
      or other regulatory requirement. 







7

	
      5. 8 
	
      Both parties acknowledge that they have carefully
      reviewed and understand the provisions of this Agreement and the parties
      acknowledge and agree that the terms are mutually fair and equitable. It
      was fully and plainly recommended to the Employee that independent legal
      and tax advice be obtained prior to entering into this Agreement.
  



IN WITNESS WHEREOF the parties have executed this
Agreement as of the Effective Date, notwithstanding its actual date of
execution. 

	SIGNED, SEALED AND DELIVERED by the EMPLOYEE in the
      presence of: 	) 		
	  	) 	 	  
	  	) 	 	  
	  	) 	 	  
	  	) 	 	(seal) 
	Signature 	) 	 Duane Morris 	  
	  	) 	 	  
	Name 	) 	 	  
	  	) 	 	  
	Address 	) 	 	  
	  	) 	 	  
	  	  	 	  
	  	  	 	  
	RESPONSE BIOMEDICAL 	)  	 An authorized signatory
      of	  
	CORPORATION 	                 	 RESPONSE BIOMEDICAL 	  
	  	)	  CORPORATION