Exhibit 10.2 Employment Agreement


    EMPLOYMENT
      AGREEMENT

    DATED
      AS
      OF MARCH 6, 2006

    BETWEEN
      PAPERFREE MEDICAL SOLUTIONS, INC. AND STEPHEN HAWKSWORTH

     

    STEPHEN
      HAWKSWORTH ("Executive") and PAPERFREE MEDICAL SOLUTIONS, INC. ("Company")
      hereby agree as follows:

     

    1.
      Term.
      The term of Executive's employment by Company under this Agreement (the "Term")
      shall commence on and as of March 6, 2006 for a one-year term ending March
      5,
      2007, and continue thereafter for successive one-year terms (the initial
      one-year term and each one-year term thereafter, collectively the "Term"),
      unless either Company or Executive gives notice to the other at least three
      (3)
      months in advance of the expiration of the current term that it wishes to
      terminate this Agreement, in which event this Agreement shall terminate as
      of
      the end of such term, unless earlier terminated as hereafter
      provided.

     

    2.
      Title
      and Duties. During the Term, Executive shall be employed by Company as Chief
      Executive Officer ("CEO") reporting to the Board of Directors of the Company.
      Executive shall devote his full-time attention and energies to the business
      of
      the Company; provided, however, that the foregoing shall not preclude Executive
      from engaging in charitable and community affairs, or participating as a
      director of a non competing business company, or managing his personal
      investments. Executive shall perform such duties, which shall not be
      inconsistent with his position as CEO of Company, as are assigned to him from
      time to time by the Chairmen of the Board of Company, and any other duties
      undertaken or accepted by Executive consistent with his position as Chief
      Executive Officer of the Company. Every executive officer of the Company (other
      than the Board of Directors) designated by the Executive shall report to him.
      Company agrees to use its best efforts to cause Executive to be elected to
      the
      Board of Directors of the Company (or its successor in interest), at the next
      annual meeting of the Company or earlier if possible, and to nominate Executive
      as a member of the management slate at each annual meeting of stockholders
      during employment hereunder at which Executive's director class comes up for
      election. Executive agrees to serve on the Board if elected. A failure to elect
      the Executive to the Board of Directors shall give the Executive the right
      to
      terminate his employment under this Agreement in accordance with Section
      10.

     

    3.
      Salary. Executive shall receive a salary of $100,000 per annum during the first
      year of the Term. Executive's salary shall be reviewed at least annually and
      may
      be increased but not decreased. Salary payments shall be made in equal
      installments in accordance with Company's then prevailing payroll
      policy.

     

    4.
      Performance Bonus. Within each year of the Term, Executive will be eligible
      for
      a performance bonus which will be determined by the mutual agreement of
      Executive and the Board of Directors, but which shall not be less than $80,000
      for any year during the Term. The performance bonus shall be subject to the
      following conditions:

    


    (a)
      The
      bonus shall be earned by Executive through the company meeting or exceeding
      fiscal quarterly performance metrics that are mutually agreed by Executive
      and
      the Board of Directors. 

    


    (b)
      The
      fiscal quarterly performance metrics may be revised within any year by mutual
      agreement of Executive and the Board of Directors to reflect changing business
      conditions.

    


    (c)
      The
      bonus shall be paid in equal installments within thirty (30) days of the end
      of
      the fiscal quarter in which the metrics are satisfied except that Executive
      shall have the right to achieve the metrics of any previous quarter, wherein
      the
      metrics went unsatisfied, in any subsequent quarter throughout the fiscal
      year.

    


    (d)
      The
      performance bonus shall be reviewed at least annually by the Board of Directors
      and may be increased but not decreased.

     

    5.
      Stock
      Warrants. Subject to Board approval, Executive shall be granted stock warrants
      (the "Two Million Warrants") to purchase an aggregate of Two Million (2,000,000)
      shares of common stock of the Company. The Two Million Warrants are deemed
      to be
      of record as of March 6, 2006. The Two Million Options shall be granted in
      accordance with, and subject to the following:

     

    (a)
      The
      exercise price of the Two Million Warrants shall be equal to the closing price
      plus Ten Percent (10%) per share of the common stock of the Company on the
      day
      before this Agreement is executed, delivered, and announced. The Two Million
      Warrants may be exercised at any time after vesting but prior to
      expiration.

     

    (b)
      The
      Two Million Options shall be subject to the terms and conditions of the 2004
      Directors, Officers and Consultants Stock Option, Stock Warrant, and Stock
      Award
      Plan; a copy of which is attached hereto and incorporated herein by reference
      as
      Exhibit "A".

     

    (c)
      The
      Two Million Warrants shall vest in such shares according to the following
      schedule:

     

    Tranche
      No. of Shares  Vesting

    -------
      -------------  -------

    1
      500,000
 
      Immediately upon execution of

    this
      Agreement

    2
      500,000
 June
      5,
      2006

    3
      500,000
 September
      5, 2006

    4
      500,000
 December
      5, 2006

     

    The
      vesting schedule shall be accelerated in the event of a Non-Fault Termination
      (as defined in Section 11).

     

    (d)
      In
      the event there is a Change of Control at any time during the Term, then the
      acceleration of the vesting schedule of the Two Million Warrants and the
      exercisiability of the Two Million Warrants shall be governed by the Plan upon
      such Change of Control.

     

    (e)
      The
      Two Million Warrants shall expire on the earlier of ten years from the date
      of
      grant or the termination date plus two (2) years after termination of
      Executive's employment with Company.

     

    (f)
      At
      the end of the initial Term, Executive shall have the right, for a period of
      six
      (6) months thereafter, exercisable on ten (10) days written notice to Company
      ("Put Period"), to require the Company to purchase from him up to 2,000,000
      shares of the common stock of the Company held by Executive as a result of
      the
      exercise of the Two Million Warrants at a purchase price equal to the closing
      price less ten percent (10%) of the common stock of the Company on the day
      after
      the initial Term.

     

    (g)
      In
      the event the outstanding shares of common stock of Company are changed into
      or
      exchanged for a different number or kind of shares or other securities of
      Company or of another corporation by reason of merger, consolidation, other
      reorganization, reclassification, combination of shares, stock split-up or
      stock
      dividend, rights of the Two Million Warrants granted hereunder, the number
      of
      subject shares and the exercise price (and other terms herein relating thereto)
      shall be adjusted appropriately.

     


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    6.
      Benefits. Executive shall be entitled to receive the following
      benefits:

     

    (a)
      Health care coverage equivalent to that provided to the Company's other
      executive officers at the Executive’s option subject to the stated Enrollment
      Periods then prevailing.

     

    (b)
      Reimbursement of reasonable living expenses in the Kokomo area to a monthly
      maximum of two thousand five hundred dollars ($2,500) per month.

    


    (c)
      Three
      (3) weeks paid vacation each year during the Term. The maximum accrued vacation
      shall be six (6) weeks.

       

    (d)
      The
      Executive shall be treated in the same manner as, and shall be entitled to
      such
      benefits and other perquisites and terms and conditions of employment no less
      favorable than those provided to the most senior officers of the
      Company.

     

    7.
      Reimbursement for Expenses. Executive shall be expected to incur various
      business expenses customarily incurred by persons holding like positions,
      including but not limited to traveling, entertainment and similar expenses,
      all
      of which are to be incurred by Executive in the belief that they will benefit
      the Company. Subject to Company's policy regarding the reimbursement and
      non-reimbursement of such expenses, Company shall reimburse Executive for such
      expenses from time to time, at Executive's request, and Executive shall account
      to Company for such expenses.

     

    8.
      Protection of Company's Interests.

     

    (a)
      During the Term of Executive's employment by Company, Executive will not compete
      in any manner, directly or indirectly, whether as a principal, employee,
      consultant, agent, owner or otherwise, with Company or any affiliate thereof
      except that the foregoing will not prevent Executive from holding at any time
      less that 5% of the outstanding capital stock of any company whose stock is
      publicly traded.

     

    (b)
      To
      the extent permitted by law, all rights worldwide with respect to any and all
      intellectual or other property of any nature produced, created or suggested
      by
      Executive during the Term of his employment or resulting from his service shall
      be deemed to be a work for hire and shall be the sole and exclusive property
      of
      Company. Executive agrees to execute, acknowledge and deliver to Company, at
      Company's request, such further documents as Company finds appropriate to
      evidence Company's rights in such property. Any confidential and/or proprietary
      information of Company or any affiliate thereof (including, without limitation,
      any information relating to the identities, capabilities, compensatory and
      contractual arrangements and/or general personnel data of employees of Company
      and its affiliates) shall not be used by Executive or disclosed or made
      available by Executive to any person except as required in the course of his
      employment, and upon expiration or earlier termination of the term of this
      Agreement, Executive shall return to Company all such information that exists
      in
      written or other physical form (and all copies thereof) under his control.
      Executive agrees to sign the Company's standard form of confidentiality
      agreement contemporaneously with the execution and delivery of this
      Agreement.

     

    9.
      Termination. In addition to any right to terminate under Section 1
      above:

     

    (a)
      Company shall have the right to terminate Executive's employment with Company
      under the following circumstances:

     

    (i)
      Upon
      death of Executive;

     

    (ii)
      Upon
      notice from the Company to Executive in the event of an 

    illness
      or other disability which has totally and permanently

    incapacitated
      him from performing his duties as Executive on a

    substantially
      full-time basis as described in the Company's long

    term
      disability plan;

     

    (iii)
      For
      good cause immediately upon notice from Company. Termination 

    by
      Company of Executive's employment for "good cause" as used in

    this
      Agreement shall mean actual fraud, embezzlement or

    intentional
      misconduct which has caused demonstrable and serious

    injury
      to
      the Company; or

     

    (iv)
      Conviction of a felony or crime of moral turpitude which has 

    caused
      serious injury to the Company.

     

    (b)
      If
      Executive's employment is terminated pursuant to Section 9(a)(iii) or 9(a)(iv)
      above, Executive's rights and Company's obligations hereunder, and all unvested
      stock warrants granted in accordance with this Agreement which have not already
      vested shall forthwith terminate in their entirety, except that, notwithstanding
      the foregoing, (i) the expiration date of any Warrants which have already vested
      in accordance with this Agreement shall be 30 days after the date of termination
      pursuant to Section 9(a).

     

    (c)
      If
      Executive's employment is terminated pursuant to this Section 9 no Termination
      Payment (as defined in Section 11) shall be payable.

     

    10.
      Termination by Executive. Prior to the expiration of the Term, Executive shall
      have the right to terminate his employment under this Agreement upon 30 days'
      notice to Company given within 60 days following the occurrence of any of the
      following events, provided that Company shall have 20 days after the date such
      notice has been given to Company in which to cure the conduct or cause specified
      in such notice:

     

    (a)
      Executive is not elected or retained in accordance with Section 2 as CEO
      (reporting to Company's Board of Directors) and a director of
      Company;

     

    (b)
      There
      is a significant change in the nature or scope of the Executive's authority,
      powers, functions, duties or responsibilities;

     

    (c)
      There
      is a substantial and continued reduction in the level of support services,
      staff, secretarial and other assistance, office space and accoutrements
      available to a level below that which is reasonably necessary for the
      performance of Executive's duties;

     

    (d)
      Company shall fail to issue stock pursuant to Executive's stock warrants
      provided for herein or shall reduce his salary or shall deny Executive
      eligibility for annual discretionary bonuses, or Company shall fail to make
      any
      compensation payment required hereunder;

     

    (e)
      A
      Change of Control shall occur; and

     

    (f)
      Any
      breach of this agreement by the Company.

     

    11.
      Termination Payment. If a Non-Fault Termination (as defined below) of
      Executive's employment with Company shall occur other than by means of the
      death
      or disability of Executive, Executive shall be entitled to receive a lump sum
      payment equal to the Executive's then annual base salary and bonus (provided,
      however, that in no event shall the annual bonus be less than $50,000)
      (Termination Payment). The Termination Payment shall be made to Executive not
      later than 30 days after the date of such Non-Fault Termination. "Non-Fault
      Termination" shall mean Executive's employment with Company shall be terminated
      (i) without cause, (ii) be reason of death or total and permanent disability
      pursuant to Section 9(a)(i) or (ii) hereof, or (iii) Executive shall validly
      terminate his employment pursuant to Section 11 hereof. Except for Executive's
      rights under Sections 5(e), 5(f) and 6(e), which shall remain in full force
      and
      effect after any Non-Fault Termination of this Agreement, and for the
      acceleration of the vesting of the Two Million Warrants, the Termination Payment
      described in this Section 11 shall be Executive's sole and exclusive remedy
      under this Agreement in the event of a Non-Fault Termination.

     

    12.
      Assignment. Company may assign this Agreement or all or any part of its rights
      hereunder to any entity that succeeds to all or substantially all of Company's
      assets or that holds, directly or indirectly, all or substantially all of the
      capital stock of Company or that is otherwise a successor in interest to Company
      generally, and this Agreement shall insure to the benefit of, and be binding
      upon, such assignee or successor in interest. This Agreement is personal to
      Executive and Executive may not, without the express written permission of
      Company, assign or pledge any rights or obligations hereunder to any person,
      firm, corporation or other entity.

     

    13.
      No
      Conflict with Prior Agreements. Executive represents and warrants to Company
      that, to the best of his personal knowledge and belief, neither the execution
      and delivery of this Agreement, his commencement of employment hereunder nor
      the
      performance of his duties hereunder conflicts with any contractual commitment
      on
      his part of any third party or violates or interferes with any rights of any
      third party.

     

    14.
      Key
      Man Insurance. Company shall have the right to secure, in its own name or
      otherwise, and at its own expense, life, disability, accident or other insurance
      covering Executive and Executive shall have no right, title or interest in
      or to
      such insurance. Executive shall assist Company in procuring such insurance
      by
      submitting to reasonable examinations and signing such applications and other
      instruments as may be required by the insurance carriers to which applications
      is made for any such insurance.

     

    15.
      Post-Termination Obligation. After the expiration or earlier termination of
      the
      Executive's employment hereunder for any reason whatsoever, Executive shall
      not
      either alone or jointly, with or on behalf of others, either directly or
      indirectly, expressly or implied, whether as principal, partner, agent,
      shareholder, director, employee, consultant or otherwise, at any time during
      a
      period of two years following such expiration or termination, solicit in any
      manner whatsoever the employment or engagement of, either for his own account
      or
      for any other person, firm, company or other entity, any person who is employed
      by Company or any affiliated entity, whether or not such person would commit
      any
      breach of his contract of employment by reason of his leaving the service of
      Company or any affiliated entity.

     

    16.
      Reimbursement of Legal Expenses. Company agrees to reimburse Executive for
      his
      reasonable out-of-pocket legal expenses and costs incurred in connection with
      the negotiation and preparation of this Agreement.

     

    17.
      Entire Agreement, Amendment, Waiver, Etc.

     

    (a)
      This
      Agreement supersedes all prior and/or contemporaneous agreement and/or
      statements, whether written or oral, concerning the terms of Executive's
      employment, and no amendment or modification of this Agreement shall be binding
      unless set forth in writing signed by Company and Executive. No waiver by either
      party of any breach by the other party of any provision or condition of this
      Agreement shall be effective unless in writing and signed by the party effecting
      the waiver, and no such waiver shall be deemed a waiver of any similar or
      dissimilar provision or condition at the same or any prior or subsequent
      time.

     

    (b)
      All
      payments required to be made to Executive hereunder, whether during the term
      of
      his employment hereunder or otherwise, shall be subject to all applicable
      federal, state and local tax withholding laws.

     

    (c)
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of Indiana. In the event of any controversy or claim by either party
      hereunder, the prevailing party in any final and legally binding adjudication
      (as to which all periods for the filing of any appeal have expired) with respect
      to such controversy or claim shall be entitled to reimbursement from the losing
      party for reasonable attorney's fees and costs and for all other reasonable
      expenses of such adjudication.

     

    18.
      Notices. All notices that either party is required or may desire to give the
      other shall be in writing and shall be effective (i) upon personal delivery
      or
      (ii) three business days after deposit of the same with the United States Postal
      Service for delivery by certified mail, return receipt requested, addressed
      to
      the party to be given notice as follows:

     

    To
      Company: PaperFree Medical Solutions, Inc.

    121
      West
      Sycamore Street

    Kokomo,
      Indiana 46901

    Attn:
      William Sklar, Chairman

     

    To
      Executive: Stephen Hawksworth

    1725
      Kent
      Road

    Hoffman
      Estates, Illinois 60195

     

    Either
      party may by written notice designate a different address for giving notices.
      The date of mailing of any such notices shall be deemed to be the date on which
      such notice is given.

     

    19.
      Arbitration. Any dispute arising out of this Agreement shall be determined
      by
      arbitration in Indianapolis, Indiana, under the rules of the American
      Arbitration Association then in effect and judgment upon any award pursuant
      to
      such arbitration may be enforced in any court having jurisdiction thereof,
      provided each of the parties to this Agreement will appoint one person as an
      arbitrator to hear and determine the dispute, and if they are unable to agree,
      then the two arbitrators so chosen will select a third impartial arbitrator
      whose decision will be final and conclusive upon the parties to this Agreement.
      Subject to Section 16(c), the expenses of the arbitration proceedings concluded
      pursuant to this paragraph will be borne by the parties in such proportions
      as
      the arbitrators decide.

     

    20.
      Certain Additional Payments by the Company. Anything in this Agreement to the
      contrary notwithstanding, in the event it shall be determined that any payment,
      award, benefit or distribution by the Company to or for the benefit of the
      Executive would be subject to the excise tax imposed by Section 4999 of the
      Code
      or any corresponding provisions of state or local tax laws as a result of
      payment upon a change of control, or any interest or penalties are incurred
      by
      the Executive with respect to such excise tax (such excise tax, together with
      any such interest and penalties, are hereinafter collectively referred to as
      the
      "Excise Tax"), then the Executive shall be entitled to receive an additional
      payment (a "Gross-Up Payment") in an amount such that after payment by the
      Executive of all taxes (including any interest or penalties imposed with respect
      to such taxes) imposed upon the Gross-Up Payment, the Executive retains an
      amount of the Gross-Up Payment equal to the Excise Tax imposed upon the
      payments.

     

    21.
      Headings. The headings set forth herein are included solely for the purpose
      of
      identification and shall not be used for the purpose of construing the meaning
      of the provisions of this Agreement.

     

     


    IN
      WITNESS WHEREOF, the parties have executed this Agreement as of the date first
      written above.

    


    PAPERFREE
      MEDICAL SOLUTIONS, INC.

    


    
      	 /s/ Stephen Hawksworth	 /s/ William Sklar
	
              ________________________

              STEPHEN
                HAWKSWORTH

            	
              ________________________

              WILLIAM
                SKLAR, CHAIRMAN