**6. ****VACATIONS****.**During the Term of this Agreement, Employee shall be entitled to annualpaid vacation time equal to fifteen (15) days, to be taken at a time or times acceptable to theCompany and otherwise consistent with the terms and conditions of this Agreement and the Company’svacation pay policy.     **7. ****RELOCATION EXPENSES****.**During the Term of this Agreement, if Employee is required bythe Company to relocate his permanent residence to a location outside of Northeastern Ohio, thenthe Company will reimburse Employee for all reasonable relocation expenses, including the expenseof moving Employee’s possessions and reasonable expenses incurred in travel to the new location forthe purpose of locating housing. The Company will further reimburse Employee for all reasonabletemporary housing expenses at the new location for the first 90 days after the date requested bythe Company for the Employee’s relocation.     **7.1****REAL ESTATE BROKER’S COMMISSIONS****.**The Company will reimburse Employee forreasonable licensed real estate broker’s commission (Broker’s Fee) incurred by Employee in the saleof the Employee’s permanent residence if Employees is required by the Company to relocate hispermanent residence to a location outside of Northeastern Ohio. The Employee will provide theCompany with appropriate documentation to support the Broker’s Fee incurred by Employee.     **8. ****TERM AND TERMINATION OF AGREEMENT****.**This Agreement shall commence on the effectivetime indicated below and shall continue for a period of one (1) year (the “Initial Term”), unlesssooner terminated as provided in paragraphs 8.1, 8.2, 8.3, 8.5, 8.6, 8.7 or 8.8 of this Agreement.This Agreement will renew automatically for successive one (1) year periods (the “Renewal Period,”and collectively with the Initial Term, the “Term”) unless previously terminated or either partygives notice of non-renewal at least 90 days prior to the commencement of such Renewal Period.     **8.1****TERMINATION FOR DEATH****.**This Agreement shall terminate automatically upon theEmployee’s death. With the exception of any benefits under the Company’s employee benefit plans,and any stock options that have vested under the Company’s Stock Option Plan(s) which may inure tothe benefit of Employee’s beneficiaries, upon Employee’s death, the Company shall have no furtherobligations under the terms and conditions of this Agreement. If Employee’s employment isterminated pursuant to this section during the Term of this Agreement, employee shall be entitledto his salary through the date of such termination, payment for any pro-rata bonus earned and dueat the time of termination pursuant to any (if any) bonus plan(s) the Company may have in effect atthe time of termination, and to any other employee benefits maintained or established by theCompany for its similarly situated employees.     **8.2****TERMINATION FOR DISABILITY****.**The Company and the Employee acknowledge and agreethat the essential functions of the Employee’s position are unique and critical to the Company andthat a disability condition which causes the Employee to be unable to perform the essentialfunctions of his position with or without reasonable accommodations for a period in excess of onehundred twenty (120) calendar days will constitute an undue hardship on the Company. If the Companydetermines in good faith upon medical certification and in consultation with Employee and, ifnecessary or appropriate, with Employee’s physician(s), that the Employee is disabled and unable toperform the essential function of his position with or without reasonable accommodations, it maygive Employee written notice of its intention to terminate Employee’s employment. If Employee’semployment is terminated pursuant to this section during the Term of this Agreement, employee shallbe entitled to his salary through the date of such termination, payment for any pro-rata bonusearned and due at the time of termination pursuant to any (if any) bonus plans the Company may havein effect at the time of termination, and to any other employee benefits maintained or establishedby the Company for its similarly situated employees.     **8.3****TERMINATION BY COMPANY FOR CAUSE****.**During the Term of this Agreement, the Companymay terminate Employee’s employment for cause by written notification citing the specific reasonsfor termination. For purposes of this Agreement, “Cause” means:          (1) Employee’s conviction of a felony involving moral turpitude or a felony in connection withhis employment;          (2) Employee’s theft, fraud, embezzlement, material willful destruction of property ormaterial disruption of the operations of the Company;          (3) Employee’s use or possession of illegal drugs and/or unauthorized use or possession ofalcohol on Company premises or reporting to work under the influence of same; or          (4) Employee’s engaging in conduct, in or out of the workplace, which in the Company’sreasonable determination has an adverse effect on the reputation or business of the Company;
 

 
     Under any such termination for Cause, all rights, benefits, obligation and duties of theparties hereunder shall immediately cease, except any compensation due and owing through the dateof termination and/or fringe benefits which have vested on Employee’s behalf prior to suchtermination, if any, and except for the covenants of Employee set forth in Section 9 of thisAgreement.     **8.4****SUSPENSION****.**In the event Employee engages in conduct subjecting Employee topotential civil or criminal liability which could have an adverse effect upon the Company’sreputation or business or is related to Employee’s duties and responsibilities, the Companyreserves the right to immediately suspend Employee with pay, pending investigation and/or theoutcome of the matter.     **8.5****TERMINATION BY EMPLOYEE WITHOUT GOOD REASON/NON-RENEWAL BY EMPLOYEE****.**During theTerm of this Agreement, Employee may terminate his employment and this Agreement at any time forany or no reason upon at least 30 days written notice by the Employee directly to the Company’sPresident. Prior to and/or during any Renewal Period, Employee may also terminate this Agreement bygiving a notice of non-renewal at least 120 days prior to the commencement of the next RenewalPeriod. Employee acknowledges and agrees that a voluntary resignation, termination or retirement byEmployee during the Term of this Agreement as described in this Section 8.5, and/or a notice ofnon-renewal by Employee prior to and/or during any Renewal Period as described in this Section 8.5,shall result in the termination of this Agreement and all rights and obligations under thisAgreement shall immediately cease, except any fringe benefits or stock options which have vested onEmployee’s behalf prior to such termination.     **8.6****TERMINATION BY EMPLOYEE FOR GOOD REASON****.**Employee may terminate his employment atany time during the Term of this Agreement for “Good Reason.” “Good Reason” shall mean (a) anymaterial reduction by the Company of Employee’s duties, responsibilities, base salary, title orposition, or (b) any involuntary removal of Employee from any position previously held (except inconnection with a promotion or a termination for Cause, Death, or Disability, or the voluntarytermination by the Employee Without Good Reason). Prior to any Termination by Employee for GoodReason pursuant to this Section 8.6, Employee shall provide the President with sixty (60) calendardays’ written notice of the acts and/or omissions of the Company which Employee asserts constitute“Good Reason,” and if, at the conclusion of that sixty (60) calendar day period, the Company hasnot undertaken reasonable efforts to cure or correct the alleged acts and/or omissions, thenEmployee may terminate his employment pursuant to this Section 8.6. In the event of suchtermination by Employee for Good Reason, Employee shall be entitled to receive (i) his salarythrough the date of such termination and for a period of one (1) year after such termination, and(ii) outplacement services from an agency to be selected by the Company in an amount not to exceedTen Thousand ($10,000) Dollars.     **8.7****TERMINATION OTHER THAN FOR CAUSE, DEATH, OR DISABILITY; TERMINATION BYNON-RENEWAL****.**During the Term of this Agreement, the Company may terminate Employee for otherthan Cause, Death, or Disability at any time during the Term of this Agreement, upon not less thanthirty (30) days notice. Prior to and/or during any Renewal Period, the Company may also terminatethis Agreement by giving a notice of non-renewal at least 90 days prior to the commencement of thenext Renewal Period. In the event the Company exercises its right to terminate the Employee otherthan for Cause, Death, or Disability at any time during this Agreement, during the Term of thisAgreement as described in this Section 8.7, and/or gives a notice of non-renewal prior to and/orduring any Renewal Period as described in this Section 8.7, Employee shall at the time of suchtermination be entitled to receive (i) his salary through the date of such termination and for aperiod of one (1) year after such termination, and (ii) outplacement services from an agency to beselected by the Company in an amount not to exceed Ten Thousand ($10,000) Dollars.     **8.8****CHANGE OF CONTROL****.**If a Change of Control (as defined in this paragraph) shalloccur during the Term of this Agreement, and Employee’s employment is (a) not continued by thepurchaser or successor or (b) there is a material change in Employee’s role, duties, responsibilityor title following a Change of Control and Employee voluntarily terminates his employment and thisAgreement therefor, Employee shall be entitled to receive (i) his salary through the date of suchnon-continuation and for a period of one (1) year after such non-continuation, and (ii)outplacement services from an agency to be selected by the Company in an amount not to exceed TenThousand ($10,000) Dollars. For purposes hereof, the term “Change of Control” shall mean (A) thesale of all or substantially all of the assets of the Company, (B) the sale of a majority of theoutstanding shares of capital stock of the Company entitled to vote in a single transaction orseries of related transactions (except with respect to a public offering of the Company’s shares ofcapital stock), (C) the consummation of a merger, consolidation or similar transaction involvingthe Company in which the holders of the Company’s capital stock immediately prior to thetransaction do not retain at least a majority of the voting power of the Company surviving themerger or its parent Company, or (D) the complete liquidation or dissolution of the Company.
 

 
     **8.9****BINDING ARBITRATION****.**In the event, upon termination of Employee’s employment, adisagreement exists between Employee and the Company as to which section of this Section 8 governssuch termination (i.e., if the party terminating Employee’s employment (the “Terminating Party”)claims that “Cause”, “Good Reason” or “Disability” exists and the other party (the “DisputingParty”) disputes such claim), the issue of which section should govern such termination shall besubmitted by the parties to binding arbitration in accordance with the provisions of this Section8.9. Within thirty (30) days after termination of Employee’s employment the Disputing Party maychallenge the claimed basis for termination by giving written notice (the “Dispute Notice”) of suchchallenge to the Terminating Party. Within thirty (30) days after delivery of such Dispute Notice,the parties shall appoint an independent arbitrator experienced in employment matters who shalldetermine which section of this Section 8 applies to the termination. In the event the partiescannot agree on an arbitrator within thirty (30) days after delivery of the Dispute Notice, theneach party shall appoint one arbitrator, and the two arbitrators shall appoint a third arbitrator.In either case, the determination of the arbitrator or the majority of the arbitrators, as the casemay be, shall be final and binding upon both Employee and the Company. The authority of thearbitrators hereunder shall be limited to determining which section of this Section 8 governs, andthe arbitrators shall not have authority to reinstate Employee, to alter the amount of the paymentdue to Employee under the applicable section of this Section 8, or to award Employee or the Companyany other amounts by way of damages or otherwise. Any arbitration hereunder shall be conducted inCleveland, Ohio in accordance with the National Rules for the Resolution of Employment Disputes ofthe American Arbitration Association. In the event the Disputing party fails to give the DisputeNotice within the thirty (30) day period provided above, all rights of the Disputing Party tochallenge the claimed basis for termination shall expire.     **9. ****RESTRICTIVE COVENANTS OF EMPLOYEE****.**Employee acknowledges that the services renderedto the Company are special, unique, and of extraordinary character; that the market for theCompany’s services and products is worldwide; and that through the Internet, World Wide Web, and/orother media of electronic commerce, the Company regularly transacts business on a worldwide basis.In light of those factors, Employee acknowledges that the following covenants are reasonable andnecessary for the protection of the Company’s reasonable business interests.     **9.1****NON-COMPETITION****.**During the period of Employee’s employment by the Company and, inthe case of the termination of Employee’s employment under Sections 8.2, 8.6, 8.7, or 8.8 hereof,for a period of one (1) year thereafter, or (ii) in the case of the termination of Employee’semployment under any provision of Section 8 hereof other than Sections 8.2, 8.6, 8.7, or 8.8 for aperiod of eighteen (18) months (the “Non-competition Period”), Employee shall not, directly orindirectly, whether as an individual on his own account, or as a partner, joint venturer, director,officer, employee, consultant, creditor and/or agent or otherwise, in any place in which theCompany now or hereafter conducts business:     (a) Enter into or engage in any business which provides software and related web hosting,educational and training services, and/or other Applications Services Provider (“ASP”) services, tocustomers in the pharmaceutical, biotech, and/or medical device industries to assist in theelectronic capture of clinical trial patient data from clinical trial sites;     (b) Solicit customers, business, patronage or orders from, or perform other services for, anyperson, firm, association, corporation or other entity, engaged in any business, including withoutlimitation, an Applications Services Provider, which directly or indirectly competes with thebusiness of the Company or parent or subsidiary of, or entity controlling, controlled by or undercommon control with the Company (“Company Affiliate”); or     (c) Promote or assist, financially or otherwise, any person, firm, association, corporation orother entity, engaged in any business, including without limitation, an Applications ServicesProvider, which competes with the current or future business of the Company or any CompanyAffiliate; provided, however, that the foregoing covenant shall not be deemed to have been violatedsolely by (i) the ownership of equity securities of an entity which competes with a future businessof the Company or any Company Affiliate, to the extent that such securities are acquired prior tothe date that the Company or Company Affiliate commences such future business; or (ii) theownership for investment purposes of less than five percent (5%) of the equity securities of anyentity which has equity securities listed on a national securities exchange or publicly traded inthe over-the-counter market.     **9.2****CONFIDENTIALITY AND WORK PRODUCT****.**Employee acknowledges that during his employmentwith the Company he has had and will have access to confidential information, knowledge, and dataregarding the business of the Company and Company Affiliates, whether received, acquired ordeveloped by him or otherwise, including, without limitation, trade secrets, design information,software programs, research methods and techniques, scientific data and formulae, pricing data,customer information and all other information or data relevant to the business of the Company(collectively, except any of the foregoing which is at the time generally known to the public andwhich did not become generally known through the breach of any agreement restricting itsdisclosure, “Proprietary Information”). Employee further acknowledges that in the course of hisemployment he may be producing designs, analyses, recommendations, reports, complications,software, studies and other worth product, acquiring information on behalf of the Company and anyconceive of ideas, innovations, processes and improvements relating to the business of
 

 
the Company (collectively, “Work Product”). As to the ownership, disclosure and use of ProprietaryInformation and Work Product, Employee agrees that, from and after the date hereof:     (a) he will promptly disclose in writing to the Company all Work Product;     (b) all Proprietary Information, all Work Product and all rights therein are and shall be thesole and exclusive property of the Company and all rights or interest of Employee therein arehereby assigned by Employee to the Company, and Employee will cooperate with and assist the Companyfrom time to time, in any manner reasonably requested by the Company, in obtaining title orownership therein or evidence thereof;     (c) Employee shall not divulge, disclose or communicate to any third party in any manner,directly or indirectly, Proprietary Information or Work Product;     (d) Employee will not use for his own benefit or purposes or for the benefit or purposes ofany third party or permit or assist, by acquiescence or otherwise, any third party to use in anymanner, directly or indirectly, Proprietary Information or Work Product; and     (e) upon the termination of his employment, Employee will promptly deliver to the Company allProprietary Information and Work Product, including, without limitation, any reproductions, copies,abstracts, summaries or other documents or records of Proprietary Information or Work Product.      **9.3****NO INTERFERENCE****.**During the Non-competition Period, Employee agrees that he shallnot:     (a) interfere with the contractual relationship of the Company, any Company Affiliate,customers, suppliers, employees or other which relate to the business of the Company or any CompanyAffiliate; or     (b) induce any employee or representative of the Company or any Company Affiliate not tocontinue as an employee or representative of the Company or any Company Affiliate;     (c) make remarks or take any other action which disparages or diminishes the reputation of theCompany or any Company Affiliate; and     (d) without limiting the generality of the foregoing, without the prior written consent of theChief Executive Officer, directly or indirectly employ, whether as an employee, officer, director,agent, consultant or independent contractor, any person who was an employee, representative,officer or director of the Company or any Company Affiliate at any time during the six-month periodprior to the date of such proposed employment; provided, however, that the covenants contained inthis clause (d) shall not apply with respect to such person terminated by action of the Company orany Company Affiliate.      **9.4****INJUNCTIVE RELIEF****.**Both parties hereto recognize that the services to be renderedby Employee to the Company are special, unique and of extraordinary character; that the market forthe Company’s services and products is worldwide; that through the Internet, World Wide Web, and/orother media of electronic commerce, the Company regularly transacts business worldwide; and that ifEmployee hereafter fails to comply with the restrictions and obligations imposed upon himhereunder, the Company may not have an adequate remedy at law. Accordingly, the Company, inaddition to any other rights which it may have, shall be entitled to seek injunctive relief toenforce such restrictions and obligations without the necessity of posting any bond.     **10. ****REPRESENTATIONS OF EMPLOYEE****.**Employee represents and warrants to the Company thathe has the capacity to enter into this Agreement that he is not a party to any agreement,arrangement or other understanding with any person or entity which might affect, restrain orconflict with the provisions of this Agreement and/or the services to be provided to the Company byEmployee under this Agreement.     **11. ****REFORMATION OF AGREEMENT; SEVERABILITY****.**In the event that any provision or term ofthis Agreement is found to be void or unenforceable to any extent for any reason, it is theagreed-upon intent of the parties hereto that all remaining provisions or terms of the Agreementshall remain in full force and effect to the maximum extent permitted and that the Agreement shallbe enforceable as if such void or unenforceable provision or term had never been a part hereof.     **12. ****ASSIGNMENT****.**This Agreement shall inure to the benefit of, and shall be bindingupon, the Company, its successors and assigns. Employee shall not assign this Agreement without theprior written consent of the Company.
 

 
     **13. ****NOTICE****.**Any notice required to be given under the terms of this Agreement shall bein writing, and mailed to the recipient’s last known address or delivered in person. If sent byregistered or certified mail, such notice shall be effective when mailed; otherwise, it shall beeffective upon delivery.     **14. ****ENTIRE AGREEMENT; AMENDMENTS: WAIVERS****.**This Agreement contains the entireagreement between the parties hereto with respect to the subject matter hereof and replaces orsupersedes any previous agreement on such subject matter. It may not be changed orally, but onlyby agreement, in writing, signed by each of the parties hereto. The terms or covenants of thisAgreement may be waived only by a written instrument specifically referring to this Agreement,executed by the party waiving compliance. The failure of the Company at any time, or from time totime, to require performance of any of Employee’s obligations under this Agreement shall in nomanner affect the Company’s right to enforce any provisions of this Agreement at a subsequent time;and the waiver by the Company of any right arising out of any breach shall not be construed as awaiver of any right arising out of any subsequent breach.     **15. ****HEADINGS****.**The headings in this Agreement are intended solely for convenience ofreference and shall be given no effect in the construction or interpretation of this Agreement.     **16. ****COUNTERPARTS****.**This Agreement may be executed in multiple counterparts each ofwhich shall be deemed an original but all of which together shall constitute one and the samedocument.     **17. ****GOVERNING LAW****.**This Agreement shall be governed by and construed in accordancewith the laws of the State of Ohio without giving effect to the conflict of law provisions thereof.     IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of April 14,2008.         /s/ Raymond J. Merk         **Raymond J. Merk (Employee)**           **DATATRAK International, Inc.**           BY: /s/ Jeffrey A. Green     ITS: President & Chief Executive Officer