Document:

Helius Medical Technologies, Inc.: Exhibit 10.3 - Filed by newsfilecorp.com

EXECUTION VERSION 

EMPLOYMENT AGREEMENT 

EMPLOYMENT AGREEMENT (the
“Agreement”), dated effective as of October 19, 2015 (the “Effective Date”), by
and between NeuroHabilitation Corporation a Delaware registered
corporation (the “Company”), and Joyce LaViscount (the “Executive”). 

W I T N E S S E T H: 

WHEREAS,
the Company desires to employ the Executive and the Executive desires to be
employed by the Company, upon the terms and subject to the conditions set forth
in this Agreement. 

NOW,
THEREFORE, in consideration of the covenants and agreements hereinafter set
forth and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows: 

1.      EFFECTIVENESS
OF AGREEMENT 

This
Agreement shall become effective as of the Effective Date. 

2.      EMPLOYMENT
AND DUTIES 

2.1.      General. The
Company hereby employs the Executive, and the Executive agrees to serve, as the
Chief Financial Officer (CFO) and Chief Operating Officer (COO) of the Company, upon the terms and conditions contained herein. The
Executive shall have all of the responsibilities and powers normally associated
with such office in a company of the size and nature as the Company. The
Executive shall perform such other duties and services for the Company
commensurate with the Executive’s position as may be reasonably
designated from time to time by the CEO of the Company. The Executive agrees
to serve the Company faithfully and to the best of the Executive’s ability under
the direction of the CEO. The Executive will devote substantially all of her
working time to the performance of her duties under this Agreement. The
Executive will disclose in writing to the CEO all other board responsibilities
and time commitment to other interest that may impede on her employment. Any
outside interest including board position, charitable organizations or other
items consuming Executive’s normal employment time will need to be approved in
writing by the CEO. 

2.2.      Term
of Employment. The Company and Executive hereby acknowledge that Executive’s
employment by the Company shall be at-will (as defined under applicable law),
and may be terminated at any time, with or without Cause (as defined below), at
the option of either the Company or Executive, subject in some cases to the
prior notice period required under Section 5 of this Agreement. If Executive’s
employment terminates for any reason, Executive shall not be entitled to any
payments, benefits, damages, awards or compensation other than as specifically
provided in Section 5 of this Agreement. No provision of this Agreement shall be
construed as conferring upon Executive a right to continue as an employee of the
Company. On the date on which Executive’s employment with the Company
terminates, for whatever reason, unless specifically otherwise agreed in writing
between Executive and the Company, Executive shall cease to hold any position
(whether as an officer, director, manager, employee, trustee, fiduciary, or
otherwise) with the Company and any of its affiliates. The period of Executive’s
employment under this Agreement is referred to herein as the “Employment Term.”

2.3.      Reimbursement
of Expenses. The Company shall reimburse the Executive for reasonable travel
and other business expenses incurred by the Executive in the fulfillment of the
Executive’s duties hereunder upon presentation by the Executive
of an itemized account of such expenditures, in accordance with practices of the
Company applied during the Employment Term.

2.4.      Place
of Employment. During the Employment Term the Executive shall principally
work out of the office at 41 University Drive, Suite 400, Newtown PA 18940
provided, however, that the Company may require the Executive to travel
from time to time in order to effect the Company’s business consistent with the
Executive’s position. 

3.      COMPENSATION

3.1.      Base
Salary. The Executive shall receive a base salary (“Base Salary”) at an
annualized rate of $300,000. The Base Salary shall be payable in arrears in
equal installments not less frequently than semi-monthly in accordance with the
payroll practices of the Company, less such appropriate deductions as shall be
required to be withheld by applicable law and regulations, or by written
election of the Executive if agreed to by the Company. 

3.2.      Annual
Review. The Executive’s Base Salary shall be reviewed by the CEO, based upon
the Executive’s performance, not less often than annually, and the Executive’s
Base Salary may thereafter be increased as may be approved by the Board in its
sole discretion. In addition to any increases affected as a result of such
reviews as contemplated by the first sentence of this Section 3.2, the Board
may, upon the recommendation of the chairperson of the Board, at any time and in
its sole discretion, increase the Executive’s Base Salary. The term “Base
Salary” as used herein shall mean and refer to the then current base salary, as
increased and adjusted from time to time in accordance with this Section 3.2
hereof. 

3.3.      Annual
Bonus. In addition to Base Salary, the Executive shall be eligible to
receive an annual bonus (“Annual Bonus”), for each of the calendar years ending
during the Employment Term. The Executive shall have the opportunity to receive
a target annual bonus of twenty five (25%) of Base Salary (“Target Bonus”),
conditioned upon, and subject to upward or downward adjustment based upon,
achievement of the Company and individual goals to be established in good faith
by the CEO and the Executive commencing with the fiscal year 2016, with any such
bonus being payable within thirty (30) days following the Company’s receipt of
its audited financial statements pertaining to such year, usually occurring at
or about April 1 of the following year. The Executive must be employed as of the
date the Annual Bonus is distributed to receive the Annual Bonus.

3.4      Stock
Options: The executive will be granted 750,000 stock options for 5 years at
a strike price 5% higher than the closing stock price on her first day or work.
One Hundred Eighty Seven Thousand Five Hundred (187,500) or 25% of the options
will vest upon signature of this Agreement by the Executive. The next three (3)
tranches of 25% each of outstanding options will vest every twelve (12) months
following Executive’s execution of this Agreement. Following the initial vesting
of 187,500 options, Executive must be employed on the date of vesting of the
remaining options. Any option vested prior to the Executive leaving the Company
for any reason will continue to be vested. In the event of a consummation of
reorganization, merger or consolidation or sale or other disposition of all or
substantially all of the assets or more than fifty percent (50%) of the
Company’s equity, the vesting timetable will accelerate and all outstanding
options will immediately become fully vested. 

4.      EMPLOYEE
BENEFITS 

4.1.      The
Executive shall, during the Employment Term, be included to the extent eligible
thereunder in an employee benefit plans, (including, without limitation, any
plans, programs or arrangements providing health, or vacation and paid holidays)
which shall be established by the Company for, or made generally available to,
senior executives of the Company whose positions are commensurate to that of the
Executive. 

4.2.      The
Executive shall, during the Employment Term, be allowed to take up to four (4)
weeks of vacation and sick leave each year or such other amount as shall be
established by the Company for senior executives of the Company whose positions
are commensurate to that of the Executive. 

5.      TERMINATION
OF EMPLOYMENT 

5.1.      Termination
Without Cause or For Good Reason 

5.1.1.      General.
The employment of the Executive may be terminated by the Company at any time
without Cause (as defined in Section 5.3) or by the Executive for Good Reason
(as defined in Section 5.4) by written notice to the other party, as applicable.
Subject to the provisions of Sections 5.1.2, 5.1.3 and 5.1.4 and notwithstanding
the pendency of the Employment Term, if the Executive’s employment is terminated
by the Company without Cause or by the Executive for Good Reason, the Company
shall pay the Executive an aggregate amount equal to the sum of the Executive’s
Base Salary and a pro rata portion of the Annual Bonus paid for the year
preceding the year of the Executive’s termination of empl oy me nt (based on a fraction where the numerator equals the number
of months of employment in the current calendar year (rounding up to the end of
the last month of employment) and the denominator equals
twelve(12)). with such t o t a l amount to be paid in equal monthly installments
during the twelve (12) month period following such termination of employment
(“Severance Period”) . In addition, there shall be an accelerated vesting of any
remaining unvested options outstanding as of the date of termination such that
the Executive shall have a total of 750,000 vested options The Executive shall
have no further right to receive any other compensation or benefits after such
termination of employment except as determined in accordance with the terms of
the employee benefit plans or programs of the Company. 

5.1.2.      Release.
The receipt of severance pay and benefits, in any amount, is conditioned upon
and subject to the Executive’s execution of a standar d release and waiver
promptly delivered to the Executive after termination in a form reasonably satisfactory to the Company. Such release
shall be executed and delivered (and no longer subject to revocation, if
applicable) within sixty (60) days following termination. The Executive will not
receive severance pay and benefits, in any amount or under any circumstances, if
the Company’s release and waiver is not executed and in full effect. 

5.1.3.      Conditions
Applicable to the Severance Period. If, during the Severance Period, the
Executive materially breaches her obligations under Section 7 of this Agreement,
the Company may, upon written notice to the Executive, terminate the Severance
Period and cease to make any further payments or provide any benefits described
in Section 5.1.1. 

5.1.4.      Death
During Severance Period. In the event of the Executive’s death during the
Severance Period, payments of Base Salary under this Section 5 shall continue to
be made during the remainder of the Severance Period to the beneficiary
designated in writing for this purpose by the Executive or, if no such
beneficiary is specifically designated, to the Executive’s estate. 

5.1.5.      Date
of Termination. The date of termination of employment without Cause shall be
the date specified in a written notice of termination to the Executive. 

5.2.      Other
Termination. 

5.2.1.      General.
If prior to the expiration of the Employment Term, the Executive’s employment is
terminated by the Company for Cause or the Executive resigns other than for Good
Reason, the Executive shall be entitled only to (i) payment of the Executive’s
Base Salary as then in effect through and including the date of termination or
resignation, and (ii) accrued but unused vacation and personal days, floating
holidays as well as Company reimbursable expenses. The Executive shall have no
further right to receive any other compensation or benefits after such
termination or resignation of employment, except as determined in accordance
with the terms of the employee benefit plans or programs of the Company or as
required by law (e.g., COBRA). 

5.2.2.      Date
of Termination. Subject to the provision in Section 5.3, the date of
termination for Cause shall be the date specified in a written notice of
termination to the Executive and the date of resignation by the Executive shall
be the date specified in the Executive’s written resignation to the Company.

5.3.      Cause.
Termination for “Cause” shall mean termination of the Executive’s employment, in
the sole judgment of the Company, because of one or more of the following: 

(i)      any
act or omission that constitutes gross negligence, misconduct, or a material
breach by the Executive of any of the Executive’s material duties or obligations
under this Agreement; 

(ii)      the
refusal and continued failure of the Executive to substantially perform the
duties reasonably required of the Executive (except termination due to death or
Permanent Disability (as hereinafter defined) as addressed below) that is not
cured within thirty (30) days of written notice from the Company; 

(iii)      conviction
of a crime (including conviction on a nolo contendre plea)
involving fraud, dishonesty or moral turpitude; 

(iv)      any
other serious misconduct by the Executive which is injurious to the financial
condition or business reputation of the Company or any of its subsidiaries or
affiliates; 

(v)      a
material breach of this Agreement that is not cured within ten (10) days of
written notice from the Company. 

5.4.      Good
Reason. Termination for “Good Reason” shall mean termination of the
Executive’s employment, in the sole judgment of the Executive, because of one or
more of the following: (i) any material change in the nature or scope of the
Executive’s authority, duties or responsibilities; or (ii) any reduction in the
Executive’s Base Salary (other than a proportional reduction as part of a
generalized reduction in the base salaries of senior management of the Company
or due to an administrative mistake which is timely resolved); (iii)
consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Company; or (iv) a
Change of Control (hereinafter defined); provided, however, that
Executive may not resign her employment for Good Reason unless: (x) Executive
provided the Company with at least thirty (30) days prior written notice of her
intent to resign for Good Reason (which notice must be provided within sixty
(60) days following the occurrence of the event(s) purported to constitute Good
Reason); and (y) the Company has not reasonably remedied the alleged
violation(s) within the thirty (30) day period.

5.5      Change
of Control. For purposes of this Agreement, a “Change of Control” shall mean any
one of the following events: 

(i)
The date on which any “Person” as such term is used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that is
not, as of the date of this Agreement, the “beneficial owner” (as defined in
Rule 13d-3 promulgated under the Exchange Act) of fifty-one percent (51%) or
more of the combined voting power of the Company’s outstanding securities having
the right to vote for the election of directors, becomes a “beneficial owner”;

(ii)
The date on which the majority of the members of the board of directors of the
Company does not consist of individuals who are incumbent directors on the date
of this Agreement or directors selected by such incumbent directors; or 

(iii)
Any one or series of decisions by the Company which vest the powers and
authority of the CEO on the date hereof to another or the current CEO’s
authority and responsibilities are diminished in any material respect.

6.      DEATH
OR DISABILITY 

In
the event of termination of employment by reason of death or Permanent
Disability, the Company shall continue to make payment of the Base Salary to the
Executive’s legal representatives (in the case of Executive’s death) or to
Executive (in the case of Executive’s disability) in accordance with the
Company’s general policies and practices then in effect, and the Executive or
the Executive’s estate shall be entitled to Base Salary and benefits determined
under Sections 3 and 4 hereof for a period of (i) six (6) months beginning on
the date of death or (ii) in the case of Permanent Disability, for twelve (12)
months beginning on the date of Permanent Disability. Other benefits shall be
determined in accordance with the benefit plans maintained by the Company, and
the Company shall have no further obligation hereunder. For purposes of this
Agreement, “Permanent Disability” means the Executive shall have been absent
from or unable to perform the Executive’s duties with the Company, as a result
of the Executive’s incapacity due to physical or mental illness for a continuous
period of one hundred eighty (180) days and that within thirty (30) days after
receiving a notice of termination from the Company the Executive shall not have
returned to the full time performance of the Executive’s duties. The notice of
termination shall set forth in reasonable detail the facts claimed to provide
the basis for the Company determination that a Permanent Disability exists. 

4 

EXECUTION VERSION 

7.      NONSOLICITATION;
NONDISPARAGEMENT; CONFIDENTIALITY; NONCOMPETITION; INVENTIONS AND
PATENTS 

7.1.      Nonsolicitation.
For so long as the Executive is employed by the Company and continuing for
twelve (12) months thereafter, the Executive shall not, without the prior
written consent of the Company, directly or indirectly, as a sole proprietor,
member of a partnership, stockholder or investor, officer or director of a
corporation, or as an employee, associate, consultant or agent of any person,
partnership, corporation or other business organization or entity other than the
Company: (x) (i) solicit or endeavor to entice away from the Company, or any of
its subsidiaries or affiliates, any person or entity who is employed by, or
serves as an agent or key consultant of, the Company, or any of its subsidiaries
or affiliates, or (ii) solicit any person or entity who during the then most
recent twelve-month period, was employed by or served as an agent or key
consultant of the Company or any of its subsidiaries or affiliates, or (y)
endeavor to entice away from, the Company, or any of its subsidiaries or
affiliates or solicit with respect to services then being rendered, or actually
planned to be rendered within the nonsolicitation period, by the Company or any
such subsidiary or affiliate, any person or entity who is, or was within the
then most recent twelve month period, a customer (or reasonably anticipated) (to
the general knowledge of the Executive or the public) to become a customer or
client of the Company, or any of its subsidiaries or, affiliates (“Customers”).
For the purposes of this Section 7.1, ownership of securities having no more
than one percent of the outstanding voting power of any entity which is listed
on any national securities exchange or traded actively in the national
over-the-counter market shall not be deemed in violation of this Section 7.1 so
long as the Executive has no other connection or relationship with such entity.

7.2.      Non-Disparagement.
The Executive hereby covenants and agrees that the Executive shall not, directly
or indirectly, make or solicit or encourage others to make or solicit any
disparaging remarks concerning the Company or its affiliates, or any of its
products, services, businesses or activities; provided that the foregoing
restriction shall not prevent truthful testimony compelled by valid legal
process. 

7.3.      Confidentiality.
The Executive covenants and agrees with the Company that the Executive will not
at any time, except in performance of the Executive’s obligations to the Company
hereunder or with the prior written consent of the Company, directly or
indirectly, disclose any secret or confidential information that the Executive may
learn or has learned by reason of the Executive’s association with the Company,
or any of its subsidiaries or affiliates. The term “confidential information”
includes information not previously disclosed to the public or to the trade by
the Company’s management or otherwise in the public domain, with respect to the
Company’s or any of its affiliates’ or subsidiaries’, products, facilities,
applications and methods, trade secrets and other intellectual property,
systems, procedures, manuals, confidential reports, product price lists,
customer lists, technical information, financial information (including the
revenues, costs or profits associated with any of the Company’s products),
business plans, prospects or opportunities, but shall exclude any information
which (i) is or becomes available to the public or is generally known in the
industry or industries in which the Company operates other than as a result of
disclosure by any employee of the Company, including, but not limited to, the
Executive, in violation of any agreement with the Company including, but not
limited to, the Executive’s agreement under this Section 7.3 or (ii) the
Executive is required to disclose under any applicable laws, regulations or
directives of any government agency, tribunal or authority having jurisdiction
in the matter or under subpoena or other process of law, or (iii) which
Executive demonstrates was already known to the Executive prior to the
Executive’s employment with the Company. 

5 

EXECUTION VERSION 

7.4.      No
Competing Employment. For so long as the Executive is employed by the
Company and continuing for twelve (12) months thereafter, the Executive shall
not, directly or indirectly, as a sole proprietor, member of a partnership,
stockholder, investor, officer or director of a corporation, or as an employee,
associate, consultant or agent of any person, partnership, corporation or other
business organization or entity other than the Company or any of its
subsidiaries or affiliates render any service to or in any way be affiliated
with a competitor (become a competitor) of the Company or any of its
subsidiaries or affiliates. For purposes of this Section 7.4, as it relates to
the twelve (12) month period following the termination of Executive’s employment
with the Company, an entity which neither sells nor markets, directly or
indirectly, products or services substantially similar to those of the Company,
its subsidiaries or affiliates or those being actively developed by the Company,
its subsidiaries or affiliates to at least one of the existing Customers of the
Company or its subsidiaries or affiliates or the Customers being actively
developed or solicited by the Company or its subsidiaries or affiliates nor
proposes to develop products or services for sale, directly or indirectly, to
any such Customer, shall not be deemed to be a competitor of the Company. For
the purposes of this Section 7.4, ownership of securities having no more than
five percent of the outstanding voting power of any competitor which his listed
on any national securities exchange or traded actively in the national
over-the-counter market shall not be deemed in violation of this Section 7.4 so
long as the Executive has no other connection or relationship with such
competitor. 

7.5.      Exclusive
Property. The Executive confirms that all confidential information is and
shall remain the exclusive property of the Company. All business records, papers
and documents kept or made by the Executive relating to the business of the
Company shall be and remain the property of the Company. 

7.6.      Inventions
and Patents. The Executive acknowledges that all discoveries, concepts,
ideas, inventions, innovations, improvements, developments, methods, processes,
design, analyses, drawings, specifications, plans, sketches, reports, materials,
programs, systems, software, models, know-how, devices, data, databases,
technology, trade secrets, works of authorship, copyrightable works, and all
patents, registrations or applications related thereto, all other intellectual property or proprietary information and all
similar or related information (whether or not patentable and copyrightable and
whether or not reduced to tangible form or practice) which relate to the
business, research and development or existing or future products or services of
the Company and or its subsidiaries or affiliates and which are conceived,
developed or made by her during the Executive’s employment with the Company
(“Work Product”) shall be deemed to be “work made for hire” (as defined in the
Copyright Act, 17 U.S.C.A. § 101 et seq., as amended) and owned exclusively by
the Company. To the extent that any Work Product is not deemed to be “work made
for hire” under applicable law, and all right, title and interest in and to such
Work Product have not automatically vested in the Company, the Executive hereby
(a) irrevocably assigns, transfers and conveys, and shall assign transfer and
convey, to the full extent permitted by applicable law, all right, title and
interest in and to the Work Product on a worldwide basis to the Company (or such
other person or entity as the Company shall designate) without further
consideration, and (b) waives all moral rights in or to all Work Product, and to
the extent such rights may not be waived, agrees not to assert such rights
against the Company or its respective licensees, successors or assigns. The
Executive shall promptly disclose such Work Product to the Company and execute
all documents and perform all actions reasonably requested by the Company
(whether during or after the Executive’s employment with the Company) to
establish, confirm, evidence, effectuate, maintain, protect, enforce, perfect,
record, patent or register any of the Company’s rights hereunder (including,
without limitation, assignments, consents, powers of attorney and other
instruments). Notwithstanding the above, Executive shall immediately advise the
Company of all Work Product and request specific permission, in writing, to be
exempt from this paragraph for that Work Product only. Executive shall only be
exempt if the Executive receives specific permission, in writing, from the
Board. 

6 

EXECUTION VERSION 

7.7.      Injunctive
Relief. Without intending to limit the remedies available to the Company,
the Executive acknowledges that a breach of any of the covenants contained in
this Section 7 may result in material and irreparable injury to the Company or
its affiliates or subsidiaries for which there is no adequate remedy at law,
that it will not be possible to measure damages for such injuries precisely and
that, in the event of such a breach or threat thereof, the Company shall be
entitled to seek a temporary restraining order and/or preliminary or permanent
injunction restraining the Executive from engaging in activities prohibited by
this Section 7 or such other relief as may be required specifically to enforce
any of the covenants in this Agreement. If for any reason it is held that the
restrictions under this Section 7 are not reasonable or that consideration
therefore is inadequate, such restrictions shall be interpreted or modified to
include as much of the duration and scope identified in this Section 7 as will
render such restrictions valid and enforceable. 

8.      ARBITRATION

Any
dispute arising under or in connection with this Agreement or Executive’s
employment or termination thereof, other than Section 7 that cannot be mutually
resolved by the parties hereto shall be settled exclusively by arbitration in
Philadelphia, Pennsylvania in accordance with the rules of the American
Arbitration Association then in effect, before one arbitrator of exemplary
qualifications and stature, who shall be selected jointly by the Company and the
Executive, or, if the Company and the Executive cannot agree on the selection of
the arbitrator selected by the American Arbitration Association (provided that
any arbitrator selected by the American Arbitration Association shall not,
without the consent of the parties hereto, be affiliated with the Company or the
Executive or any of their respective affiliates). Judgment may be entered on the arbitrator’s award in any court having
jurisdiction. The parties hereby agree that the arbitrator shall be empowered to
enter an equitable decree mandating specific enforcement of the terms of this
Agreement. The parties understand and agree, however, that disputes arising
under Section 7 of this Agreement may be brought in a court of law or equity
without submission to arbitration. The Executive further agrees to accept
service of process by first class or certified United States mail and consents
to the jurisdiction of the Philadelphia, Pennsylvania courts. 

7 

EXECUTION VERSION 

9.      SECTION
409A COMPLIANCE 

To
the extent applicable, this Agreement shall be interpreted in accordance with
Section 409A of the internal Revenue Code of 1986, as amended (“Section 409A”),
and Department of Treasury regulations and other interpretive guidance issued
thereunder, including without limitation any such regulations or other guidance
that may be issued after the date hereof (“409A Guidance”). Notwithstanding any
provision of the Agreement to the contrary, (i) if, at the time of the
Executive’s termination of employment with the Company, the Executive is a
“specified employee” as defined in 409A Guidance and the deferral of the
commencement of any payments or benefits otherwise payable hereunder as a result
of such termination of employment is necessary in order to prevent any
accelerated or additional tax under 409A Guidance, then the Company will defer
the commencement of the payment of any such payments or benefits hereunder
(without any reduction in such payments or benefits ultimately paid or provided
to the Executive) until the date that is six months following the Executive’s
termination of employment with the Company (or the earliest date as is permitted
under Section 409A), (ii) if any other payments of money or other benefits due
to the Executive hereunder could cause the application of an accelerated or
additional tax under Section 409A, the Company may (a) adopt such amendments to
the Agreement, including amendments with retroactive effect, that the Company
determines necessary or appropriate to preserve the intended tax treatment of
the benefits provided by the Agreement and/or (b) take such other actions as the
Company determines necessary or appropriate to comply with the requirements of
409A Guidance; provided, however, that the Company shall consult with the
Executive in good faith regarding the implementation of this Section 9, and in
no event shall the benefits to which Executive is entitled be reduced and the
period of deferment shall not exceed 6 months, and (iii) to the extent that the
payment of any amount under Section 5.1.1 constitutes “nonqualified deferred
compensation” for purposes of Section 409A, any such payment scheduled to occur
during the first sixty (60) days following the termination of employment shall
not be paid until the first regularly scheduled pay period following the
sixtieth (60th) day following such termination and shall include the
payment of any amount that was otherwise scheduled to be paid prior thereto.

10.      MISCELLANEOUS

10.1.      Notices.
All notices or communications hereunder shall be in writing, addressed as
follows: 

	To the Company: 	Helius Medical Technologies Inc. 
	  	41 University Drive, 
	  	Suite 400 
	  	Newtown PA18940 

8 

EXECUTION VERSION 

	To the Executive: 	Joyce LaViscount 
	  	24 Amy Circle 
	  	Newtown , PA18940

All such notices shall be
conclusively deemed to be received and shall be effective (i) if sent by hand
delivery, upon receipt, (ii) if sent by telecopy or facsimile transmission, upon
confirmation of receipt by the sender of such transmission or (iii) if sent by
registered or certified mail, on the fifth day after the day on which such
notice is mailed. Notice given by telecopy or facsimile must also be given
simultaneously by one of the other 2 methods. 

10.2.      Severability.
Each provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Agreement
is held to be prohibited by or invalid under applicable law, such provision will
be ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement. 

10.3.      Assignment.
The Company’s rights and obligations under this Agreement shall not be
assignable by the Company, except that the Company may assign this Agreement in
connection with the sale of all or substantially all of its assets. Neither this
Agreement nor any rights hereunder shall be assignable or otherwise subject to
hypothecation by the Executive. Notwithstanding this provision and anything else
contained herein to the contrary, in the event that this Agreement is assigned
in connection with a sale of the Company and the Executive terminates the
Executive’s employment with the Company following the six (6) month anniversary
of the completion of the Company’s sale transaction, the Executive shall be
entitled to receive severance pursuant to Section 5.1.1 of this Agreement. 

10.4.      Entire
Agreement. This Agreement represents the entire agreement of the parties and
shall supersede any and all previous contracts, arrangements or understandings
between the Company and the Executive. This Agreement may be amended at any time
by mutual written agreement and any statement contained in any employment manual
memo or rule of general applicability of the Company, this Agreement shall
control. 

10.5.      Withholding.
The payment of any amount pursuant to this Agreement shall be subject to
applicable withholding and payroll taxes and such other deductions as may be
required under the Company’s employee benefit plans, if any. 

10.6.      Governing
Law. This Agreement shall be construed, interpreted and governed in
accordance with the laws of Pennsylvania without reference to rules relating to
conflict of law. 

10.7.      Survival.
Except as otherwise specifically provided in this Agreement, all
representations, warranties, covenants, agreements and conditions contained in
or made pursuant to this Agreement shall survive until termination of this
Agreement, except that Sections 5, 7, 8, 9, and 10 of this Agreement shall
survive the termination of this Agreement. 

9 

EXECUTION VERSION 

10.8.      Submission
to Jurisdiction. Any action which may be brought in a court of law with
respect to this Agreement may be brought in the courts of the State of New
Jersey or of the United States of America for the District of New Jersey, and
the Executive accepts for himself and with respect to the Executive’s property,
generally and unconditionally, the jurisdiction of these courts. The Executive
irrevocably waives any objection, including, but not limited to, any objection
of the laying of venue or based on the grounds of forum non
conveniens, which the Executive may now or hereafter have to the bringing
of any action in those jurisdictions. 

10.9.      Waiver
of Jury Trial. The Executive waives any right to a trial by jury in any
action to enforce or defend any right under this Agreement or any amendment,
instrument, document or agreement delivered or to be delivered in connection
with this Agreement or arising from any employment relationship existing in
connection with this Agreement, and agrees that any action shall be tried before
an arbitrator, as outlined in Section 8, and not before a jury. 

10.10.      Attorney’
s Fees . In the event either party brings an action to enforce any of the
provisions of this Agreement, the prevailing party shall be entitled to
reasonable attorney’s fees, expert witness fees and costs in addition to any
other relief afforded by law. 

[Signatures continued on next page] 

10 

EXECUTION VERSION 

IN
WITNESS WHEREOF, the Company has caused this Agreement to be duly executed and
the Executive has hereunto set the Executive’s hand, effective as of the day and
year first above written. 

	  	THE COMPANY: 
	 	 
	 	 
	  	Helius Medical Technologies Inc 
	 	 
	  	  
	By: 	          ”Philippe
      Deschamps”
	 	 
	  	Philippe Deschamps 
	  	  
	 	 
	 	 
	  	EXECUTIVE: 
	 	 
	  	  
	By: 	          ”Joyce
      LaViscount”
	 	 
	  	Joyce LaViscount

11Helius Medical Technologies, Inc.: Exhibit 10.4 - Filed by newsfilecorp.com

EXECUTION VERSION 

EMPLOYMENT AGREEMENT 

EMPLOYMENT AGREEMENT (the
“Agreement”), dated effective as November 2, 2015 (the “Effective Date”), by and
between Helius Medical Technologies (Canada), Inc., a Quebec- registered corporation (the “Company”), and Brian Bapty
(the “Executive”). 

W I T N E S S E T H: 

WHEREAS, the Company desires to employ the Executive and the
Executive desires to be employed by the Company, upon the terms and subject to
the conditions set forth in this Agreement. 

NOW, THEREFORE, in consideration of the covenants and
agreements hereinafter set forth and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows: 

1.      EFFECTIVENESS OF
AGREEMENT 

This Agreement shall become effective
as of the Effective Date. 

2.      EMPLOYMENT AND DUTIES

2.1.     General. The Company hereby
employs the Executive, and the Executive agrees to serve, as the Vice President
of Strategy and Business Development of the Company, upon the terms and
conditions contained herein. The Executive shall have all of the
responsibilities and powers normally associated with such office in a company of
the size and nature as the Company. The Executive shall perform such other
duties and services for the Company commensurate with the Executive’s position
as may be reasonably designated from time to time by the CEO of the Company,
including providing research work and technical planning and analysis services
with respect to the Company’s research and development efforts and related
trials conducted in Canada. The Executive agrees to serve the Company faithfully
and to the best of the Executive’s ability under the direction of the CEO. The
Executive will devote substantially all of his working time to the performance
of her duties under this Agreement. The company acknowledges the Executive holds
a board position with the publically listed company Eagle Graphite,
intermittently consults for the private company Inetco Ltd., and is on the
advisory board of private company Avro Capital. None of these companies are in
competing industries to the Company and total time related to these initiatives
is minimal. The Executive will promptly disclose in writing to the CEO any and
all other board responsibilities, changes in existing commitments, and time
commitment to other interests that may impede on his employment. Any outside
interest including board position, charitable organizations or other positions
or commitments which may consume or otherwise conflict with the Executive’s
normal employment time must be approved in writing by the CEO in advance of the
Executive accepting such positions or commitments. 

2.2.     Affiliates and
Subsidiaries. In this Agreement, “Company Entities” means the Company and
its affiliate, subsidiary and parent corporations, including Helius Medical
Technolgies, Inc. (“Helius”), to the extent that such reference does not require
any other party to be added as a party to this Agreement other than as a third
party beneficiary, each of whom will be expressly deemed an intended third party
beneficiary of this Agreement and will have the right to enforce the terms and
conditions of this Agreement. The Executive acknowledges and agrees that the
obligations of the Executive described under Section 2.1 include similar
services to be provided for the benefit each of the Company Entities, as
requested by the Company from time to time, including acting as the Vice President of Strategy and Business
Development of Helius, and that such services are performed for the Company as
part of the services provided under this Agreement without further compensation
by the affiliates or subsidiaries. To the extent that this Agreement refers to
obligations or restrictions owed to the Company, such references will be read to
include such Company Entities for whom the Employee performs hereunder.

2.2.     Term of Employment. The
Company and Executive hereby acknowledge that Executive’s employment by the
Company may be terminated at any time, with or without Cause (as defined below),
at the option of either the Company or Executive, subject to the prior notice
period required under Section 5 of this Agreement. If Executive’s employment
terminates for any reason, Executive shall not be entitled to any payments,
benefits, damages, awards or compensation other than as specifically provided in
Section 5 of this Agreement. No provision of this Agreement shall be construed
as conferring upon Executive a right to continue as an employee of the Company.
On the date on which Executive’s employment with the Company terminates, for
whatever reason, unless specifically otherwise agreed in writing between
Executive and the Company, Executive shall cease to hold any position (whether
as an officer, director, manager, employee, trustee, fiduciary, or otherwise)
with the Company or any Company Entities, and Executive will provide each of the
Company Entities with any resignation of such position as may be reasonably
requested by the Company. The period of Executive’s employment under this
Agreement is referred to herein as the “Employment Term.” 

2.3.     Reimbursement of Expenses.
  The Company shall reimburse the Executive for reasonable travel and other
  business expenses incurred by the Executive in the fulfillment of the
  Executive’s duties hereunder upon presentation by the Executive of an itemized
  account of such expenditures, in accordance with practices of the Company
applied during the Employment Term.

2.4.     Place of Employment. During
the Employment Term the Executive shall principally work out of the office at
his home provided, however, that the Company may require the Executive to
travel from time to time in order to effect the Company’s business consistent
with the Executive’s position. 

3.     COMPENSATION 

3.1.     Base Salary. The Executive
shall receive a base salary (“Base Salary”) at an annualized rate of
CAN$220,000. The Base Salary shall be payable in arrears in equal installments
not less frequently than semi-monthly in accordance with the payroll practices
of the Company, less such appropriate deductions as shall be required to be
withheld by applicable law and regulations, or by written election of the
Executive if agreed to by the Company. 

3.2.     Annual Review. The
Executive’s Base Salary shall be reviewed by the CEO, based upon the Executive’s
performance, not less often than annually, and the Executive’s Base Salary may
thereafter be increased as may be approved by the Board of Directors of Helius
(the “Board”) in its sole discretion. In addition to any increases affected as a
result of such reviews as contemplated by the first sentence of this Section
3.2, the Board may, upon the recommendation of the chairperson of the Board, at
any time and in its sole discretion, increase the Executive’s Base Salary. The
term “Base Salary” as used herein shall mean and refer to the then current base
salary, as increased and adjusted from time to time in accordance with this
Section 3.2 hereof. 

3.3.     Annual Bonus. In addition
to Base Salary, the Executive shall be eligible to receive an annual bonus
(“Annual Bonus”), for each of the calendar years ending during the Employment
Term. The Executive shall have the opportunity to receive a target annual bonus
of twenty five (25%) of Base Salary (“Target Bonus”), conditioned
upon, and subject to upward or downward adjustment based upon, achievement of
the goals of the Company Entities and individual goals to be established in good
faith by the CEO and the Executive commencing with the fiscal year 2016, with
any such bonus being payable within thirty (30) days following Helius’ receipt
of its audited financial statements pertaining to such year, usually occurring
at or about July 1 of the following year. The Executive must be employed as of
the date the Annual Bonus is distributed to be eligible to receive the Annual
Bonus.

3.4     Stock Options: The Executive
will be granted 400,000 stock options, each exercisable to acquire one share of
common stock of Helius for 5 years at a strike price 5% higher than the closing
stock price on his first day or work, or if such strike price is not permitted
under the policies of the Canadian Securities Exchange, then the lowest strike
price permitted by the Canadian Securities Exchange. Sixty Four Thousand
(64,000) or 16% of the options will vest upon signature of this Agreement by the
Executive. The remaining 336,000 options will vest in six equal 56,000 tranches
once every six months following Executive’s execution of this Agreement.
Following the initial vesting of 64,000 options, Executive must be employed on
the date of vesting of the remaining options. Any option vested prior to the
Executive leaving the Company for any reason will continue to be vested. In the
event of a consummation of reorganization, merger or consolidation or sale or
other disposition of all or substantially all of the assets or more than fifty
percent (50%) of the Helius’ equity, the vesting timetable will accelerate and
all outstanding options will immediately become fully vested. All of the options
granted to the Executive will have piggy-back rights with respect to any
registration statements filed. The options will be granted under and subject to
the terms of the Helius’ Stock Incentive Plan. 

4.     EMPLOYEE BENEFITS 

4.1.     The Executive shall, during the
Employment Term, be included to the extent eligible thereunder in an employee
benefit plans, (including, without limitation, any plans, programs or
arrangements providing health, or vacation and paid holidays) which shall be
established by the Company or Helius for, or made generally available to, senior
executives of the Company or Helius whose positions are commensurate to that of
the Executive. 

4.2.     The Executive shall, during the
Employment Term, be allowed to take up to four (4) weeks of vacation and sick
leave each year or such other amount as shall be established by the Company or
Helius for senior executives of the Company or Helius whose positions are
commensurate to that of the Executive. 

5.     TERMINATION OF EMPLOYMENT

5.1.     Termination Without Cause or
For Good Reason 

5.1.1.     General. The employment
of the Executive may be terminated by the Company at any time without Cause (as
defined in Section 5.3) or by the Executive for Good Reason (as defined in
Section 5.4) by written notice to the other party, as applicable. Subject to the
provisions of Sections 5.1.2, 5.1.3 and 5.1.4 and notwithstanding the pendency
of the Employment Term, if the Executive’s employment is terminated by the
Company without Cause or by the Executive for Good Reason, the Company shall pay
the Executive an aggregate amount equal to the sum of the Executive’s Base
Salary with such t o t a l amount to be paid in equal monthly installments
during the twelve (12) month period following such termination of employment
(“Severance Period”) . In addition, there shall be an accelerated vesting of any
remaining unvested options outstanding as of the date of termination. In the
event that termination is related to change of control as defined in 5.5, the
Company shall pay the Executive an aggregate amount equal to twice the sum of the Executive’s
Base Salary with such t o t a l amount to be paid in equal monthly installments
during the twelve (12) month period following such termination of employment
(“Severance Period”). The Executive shall have no further right to receive any
other compensation or benefits after such termination of employment except as
determined in accordance with the terms of the employee benefit plans or
programs of the Company or Helius. For greater clarity, any amount which the
Executive is entitled to receive during the Severance Period is in lieu of any
other form of notice or payment in lieu of notice, and will fully satisfy the
Company’s obligations, subject only to compliance with the minimum standards
provided in the Employment Standards Act (BC) and any other applicable
employment standards (“Employment Standards”). 

5.1.2.    Release. The receipt of
severance pay and benefits, in any amount, is conditioned upon and subject to
the Executive’s execution of a standard release and waiver promptly delivered to the Company (and any applicable Company Entities) after termination in a form
reasonably satisfactory to the Company. Such release shall be executed and
delivered (and no longer subject to revocation, if applicable) within sixty (60)
days following termination. The Executive will not receive severance pay and
benefits, in any amount or under any circumstances, if the Company’s release and
waiver is not executed and in full effect, subject only to Employment Standards.

5.1.3.    Conditions Applicable to the
  Severance Period. If, during the Severance Period, the Executive materially
  breaches his obligations under Section 7 of this Agreement, the Company may,
  upon written notice to the Executive, terminate the Severance Period and cease
  to make any further payments or provide any benefits described in Section 5.1.1,
subject only to Employment Standards. 

5.1.4.    Death During Severance
Period. In the event of the Executive’s death during the Severance Period,
payments of Base Salary under this Section 5 shall continue to be made during
the remainder of the Severance Period to the beneficiary designated in writing
for this purpose by the Executive or, if no such beneficiary is specifically
designated, to the Executive’s estate. 

5.1.5.    Date of Termination. The date
of termination of employment without Cause shall be the date specified in a
written notice of termination to the Executive. 

5.2.     Other Termination. 

5.2.1.    General. If prior to the
expiration of the Employment Term, the Executive’s employment is terminated by
the Company for Cause or the Executive resigns other than for Good Reason, the
Executive shall be entitled only to (i) payment of the Executive’s Base Salary
as then in effect through and including the date of termination or resignation,
and (ii) accrued but unused vacation and personal days, floating holidays as
well as Company reimbursable expenses. The Executive shall have no further right
to receive any other compensation or benefits after such termination or
resignation of employment, except as determined in accordance with the terms of
the employee benefit plans or programs of the Company or as required by law.

5.2.2.    Date of Termination.
Subject to the provision in Section 5.3, the date of termination for Cause shall
be the date specified in a written notice of termination to the Executive and
the date of resignation by the Executive shall be the date specified in the
Executive’s written resignation to the Company. 

5.3.     Cause. Termination for
“Cause” shall mean termination of the Executive’s employment, in the sole
judgment of the Company, because of one or more of the following: 

(i)     any act or omission that constitutes gross negligence,
misconduct, or a material breach by the Executive of any of the Executive’s
material duties or obligations under this Agreement; 

(ii)     the refusal and continued failure of the Executive to
substantially perform the duties reasonably required of the Executive (except
termination due to death or Permanent Disability (as hereinafter defined) as
addressed below) that is not cured within thirty (30) days of written notice
from the Company; 

(iii)    conviction of a crime (including conviction on a
nolo contendre plea) involving fraud, dishonesty or moral
turpitude; 

(iv)     any other serious misconduct by the Executive which is
injurious to the financial condition or business reputation of any of the
Company Entities; 

(v)     a material breach of this Agreement that is not cured
within ten (10) days of written notice from the Company. 

5.4.     Good Reason. Termination
for “Good Reason” shall mean termination of the Executive’s employment, in the
sole judgment of the Executive, because of one or more of the following: (i) any
material change in the nature or scope of the Executive’s authority, duties or
responsibilities; or (ii) any reduction in the Executive’s Base Salary (other
than a proportional reduction as part of a generalized reduction in the base
salaries of senior management of the Company Entities or due to an
administrative mistake which is timely resolved); (iii) consummation of a
reorganization, merger or consolidation or sale or other disposition of all or
substantially all of the assets of the Company Entities; or (iv) a Change of
Control (hereinafter defined); provided, however, that Executive may not
resign his employment for Good Reason unless: (x) Executive provided the Company
with at least thirty (30) days prior written notice of his intent to resign for
Good Reason (which notice must be provided within sixty (60) days following the
occurrence of the event(s) purported to constitute Good Reason); and (y) the
Company has not reasonably remedied the alleged violation(s) within the thirty
(30) day period.

5.5     Change of Control. For purposes of
this Agreement, a “Change of Control” shall mean any one of the following
events: 

(i)     The date on which any “Person” as
such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”), that is not, as of the date of this
Agreement, the “beneficial owner” (as defined in Rule 13d-3 promulgated under
the Exchange Act) of fifty-one percent (51%) or more of the combined voting
power of Helius’ outstanding securities having the right to vote for the
election of directors, becomes a “beneficial owner”; 

(ii)    The date on which the majority of the
members of the board of directors of Helius does not consist of individuals who
are incumbent directors on the date of this Agreement or directors selected by
such incumbent directors; or 

(iii)    Any one or series of decisions by
Helius which vest the powers and authority of the CEO on the date hereof to
another or the current CEO’s authority and responsibilities are diminished in
any material respect.

6.     DEATH OR DISABILITY 

In the event of termination of employment by reason of death or
Permanent Disability, the Company shall continue to make payment of the Base
Salary to the Executive’s legal representatives (in the case of Executive’s
death) or to Executive (in the case of Executive’s disability) in accordance
with the Company’s or Helius’ general policies and practices then in effect, and
the Executive or the Executive’s estate shall be entitled to Base Salary and
benefits determined under Sections 3 and 4 hereof for a period of (i) six (6)
months beginning on the date of death or (ii) in the case of Permanent
Disability, for twelve (12) months beginning on the date of Permanent
Disability. Other benefits shall be determined in accordance with the benefit
plans maintained by the Company or Helius, and the Company shall have no further
obligation hereunder. For purposes of this Agreement, “Permanent Disability”
means the Executive shall have been absent from or unable to perform the
Executive’s duties under this Agreement, as a result of the Executive’s
incapacity due to physical or mental illness for a continuous period of one
hundred eighty (180) days and that within thirty (30) days after receiving a
notice of termination from the Company the Executive shall not have returned to
the full time performance of the Executive’s duties. The notice of termination
shall set forth in reasonable detail the facts claimed to provide the basis for
the Company determination that a Permanent Disability exists. 

7.     NONSOLICITATION;
NONDISPARAGEMENT; CONFIDENTIALITY; NONCOMPETITION; INVENTIONS AND
PATENTS 

7.1.     Non-solicitation. For so
long as the Executive is employed by the Company and continuing for twelve (12)
months thereafter, the Executive shall not, without the prior written consent of
the Company, directly or indirectly, as a sole proprietor, member of a
partnership, stockholder or investor, officer or director of a corporation, or
as an employee, associate, consultant or agent of any person, partnership,
corporation or other business organization or entity other than a Company
Entity: (x) (i) solicit or endeavor to entice away from any of the Company
Entities, any person or entity who is employed by, or serves as an agent or key
consultant of, any of the Company Entities, or (ii) solicit any person or entity
who during the then most recent twelve-month period, was employed by or served
as an agent or key consultant of any of the Company Entities, or (y) endeavor to
entice away from any of the Company Entities, or solicit with respect to
services then being rendered, or actually planned to be rendered within the
non-solicitation period, by any of the Company Entities, any person or entity
who is, or was within the then most recent twelve month period, a customer (or
reasonably anticipated) (to the general knowledge of the Executive or the
public) to become a customer or client of any of the Company Entities
(“Customers”). For the purposes of this Section 7.1, ownership of securities
having no more than one percent of the outstanding voting power of any entity
which is listed on any national securities exchange or traded actively in the
national over-the-counter market shall not be deemed in violation of this
Section 7.1 so long as the Executive has no other connection or relationship
with such entity. 

7.2.     Non-Disparagement. The
Executive hereby covenants and agrees that the Executive shall not, directly or
indirectly, make or solicit or encourage others to make or solicit any
disparaging remarks concerning any of the Company Entities, or any of its
products, services, businesses or activities; provided that the foregoing
restriction shall not prevent truthful testimony compelled by valid legal
process. 

7.3.     Confidentiality. The
Executive covenants and agrees with the Company that the Executive will not at
any time, except in performance of the Executive’s obligations to the Company hereunder or with the prior written consent of the
Company, directly or indirectly, disclose any secret or confidential information
that the Executive may learn or has learned by reason of the Executive’s
association with any of the Company Entities. The term “confidential
information” includes information not previously disclosed to the public or to
the trade by the Company Entities’ management or otherwise in the public domain,
with respect to any of the Company Entities’ products, facilities, applications
and methods, trade secrets and other intellectual property, systems, procedures,
manuals, confidential reports, product price lists, customer lists, technical
information, financial information (including the revenues, costs or profits
associated with any of the Company Entities’ products), business plans,
prospects or opportunities, but shall exclude any information which (i) is or
becomes available to the public or is generally known in the industry or
industries in which any of the Company Entities operates other than as a result
of disclosure by any employee of the any of the Company Entities, including, but
not limited to, the Executive, in violation of any agreement with any of the
Company Entities, including, but not limited to, the Executive’s agreement under
this Section 7.3 or (ii) the Executive is required to disclose under any
applicable laws, regulations or directives of any government agency, tribunal or
authority having jurisdiction in the matter or under subpoena or other process
of law, or (iii) which Executive demonstrates was already known to the Executive
prior to the Executive’s employment with the Company. 

7.4.     No Competing Employment.
For so long as the Executive is employed by the Company and continuing for
twelve (12) months thereafter, the Executive shall not, directly or indirectly,
as a sole proprietor, member of a partnership, stockholder, investor, officer or
director of a corporation, or as an employee, associate, consultant or agent of
any person, partnership, corporation or other business organization or entity
other than any of the Company Entities render any service to or in any way be
affiliated with a competitor, or become a competitor, of any of the Company
Entities. For purposes of this Section 7.4, as it relates to the twelve (12)
month period following the termination of Executive’s employment with the
Company, an entity which neither sells nor markets, directly or indirectly,
products or services substantially similar to those of any of the Company
Entities or those being actively developed by any of the Company Entities, to at
least one of the existing Customers of any of the Company Entities or the
Customers being actively developed or solicited by any of the Company Entities
nor proposes to develop products or services for sale, directly or indirectly,
to any such Customer, shall not be deemed to be a competitor of any of the
Company Entities. For the purposes of this Section 7.4, ownership of securities
having no more than five percent of the outstanding voting power of any
competitor which his listed on any national securities exchange or traded
actively in the national over-the-counter market shall not be deemed in
violation of this Section 7.4 so long as the Executive has no other connection
or relationship with such competitor. 

7.5.     Exclusive Property. The
  Executive confirms that all confidential information is and shall remain the
  exclusive property of the Company Entities. All business records, papers and
  documents kept or made by the Executive relating to the business of any of the
Company Entities shall be and remain the property of the Company Entities. 

7.6.     Inventions and Patents. The
Executive acknowledges that all discoveries, concepts, ideas, inventions,
innovations, improvements, developments, methods, processes, design, analyses,
drawings, specifications, plans, sketches, reports, materials, programs,
systems, software, models, know-how, devices, data, databases, technology, trade
secrets, works of authorship, copyrightable works, and all patents,
registrations or applications related thereto, all other intellectual property
or proprietary information and all similar or related information (whether or
not patentable and copyrightable and whether or not reduced to tangible form or
practice) which relate to the business, research and development or existing or
future products or services of any of the Company Entities and which are conceived, developed or made by
his during the Executive’s employment with the Company (“Work Product”) shall be
deemed to be “work made for hire” (as defined in the Copyright Act, 17 U.S.C.A.
§ 101 et seq., as amended) and owned exclusively by the Company from the time of
creation of such Work Product. To the extent that any Work Product is not deemed
to be “work made for hire” under applicable law, and all right, title and
interest in and to such Work Product have not automatically vested in the
Company, the Executive hereby (a) irrevocably assigns, transfers and conveys,
and by creating such Work Product shall be deemed to
so assign transfer and convey, to the full extent permitted by applicable law,
all right, title and interest in and to the Work Product on a worldwide basis to
the Company (or such other person or entity as the Company shall designate)
without further consideration, and (b) waives all moral rights in or to all Work
Product, and to the extent such rights may not be waived, agrees not to assert
such rights against any of the Company Entities or its respective licensees,
successors or assigns. The Executive shall promptly disclose such Work Product
to the Company and execute all documents and perform all actions reasonably
requested by the Company (whether during or after the Executive’s employment
with the Company) to establish, confirm, evidence, effectuate, maintain,
protect, enforce, perfect, record, patent or register any of the Company’s
rights hereunder (including, without limitation, assignments, consents, powers
of attorney and other instruments). Notwithstanding the above, Executive shall
immediately advise the Company of all Work Product and request specific
permission, in writing, to be exempt from this paragraph for that Work Product
only. Executive shall only be exempt if the Executive receives specific
permission, in writing, from the Board. 

7.7.     Injunctive Relief. Without
intending to limit the remedies available to any of the Company Entities, the
Executive acknowledges that a breach of any of the covenants contained in this
Section 7 would result in material and irreparable injury to any of the Company
Entities for which there is no adequate remedy at law, that it will not be
possible to measure damages for such injuries precisely and that, in the event
of such a breach or threat thereof, the Company shall be entitled to seek a
temporary restraining order and/or preliminary or permanent injunction
restraining the Executive from engaging in activities prohibited by this Section
7 or such other relief as may be required specifically to enforce any of the
covenants in this Agreement. If for any reason it is held that the restrictions
under this Section 7 are not reasonable or that consideration therefore is
inadequate, such restrictions shall be interpreted or modified to include as
much of the duration and scope identified in this Section 7 as will render such
restrictions valid and enforceable. 

8.     ARBITRATION 

Any dispute arising under or in connection with this Agreement
or Executive’s employment or termination thereof, other than Section 7 that
cannot be mutually resolved by the parties hereto shall be settled exclusively
by arbitration in Vancouver, British Columbia in accordance with the
National Arbitration Rules of the ADR Institute of Canada Inc.(the “Arbitration Authority”) then in effect,
before one arbitrator of exemplary qualifications and stature, who shall be
selected jointly by the Company and the Executive, or, if the Company and the
Executive cannot agree on the selection of the arbitrator selected by the
Arbitration Authority (provided that any arbitrator selected by the Arbitration
Authority shall not, without the consent of the parties hereto, be affiliated
with the Company or the Executive or any of their respective affiliates).
Judgment may be entered on the arbitrator’s award in any court having
jurisdiction. The parties hereby agree that the arbitrator shall be empowered to
enter an equitable decree mandating specific enforcement of the terms of this
Agreement. The parties understand and agree, however, that disputes arising
under Section 7 of this Agreement may be brought in a court of law or equity
without submission to arbitration. The Executive further agrees
to accept service of process by first class or certified mail and consents to
the jurisdiction of the Vancouver, British Columbia
courts. 

9.     MISCELLANEOUS 

9.1.     Notices. All notices or
communications hereunder shall be in writing, addressed as follows: 

	To the Company: 	 Helius Medical Technologies (Canada),
      Inc. 
	  	c/o Helius Medical Technologies Inc. 
	  	41 University Drive, 
		Suite 400  
	  	Newtown PA18940 
	  	Attention: CEO 
	  	  
	To the Executive: 	Brian Bapty 
	  	1325 Haywood Ave 
	  	West Vancouver, BC 
	  	Canada, V7T 1V4 

All such notices shall be conclusively deemed to be received
and shall be effective (i) if sent by hand delivery, upon receipt, (ii) if sent
by telecopy or facsimile transmission, upon confirmation of receipt by the
sender of such transmission or (iii) if sent by registered or certified mail, on
the fifth day after the day on which such notice is mailed. Notice given by
telecopy or facsimile must also be given simultaneously by one of the other 2
methods. 

9.2.     Severability. Each
provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Agreement
is held to be prohibited by or invalid under applicable law, such provision will
be ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement. 

9.3.     Assignment. The Company’s
rights and obligations under this Agreement shall not be assignable by the
Company, except that the Company may assign this Agreement in connection with
the sale of all or substantially all of its assets. Neither this Agreement nor
any rights hereunder shall be assignable or otherwise subject to hypothecation
by the Executive. Notwithstanding this provision and anything else contained
herein to the contrary, in the event that this Agreement is assigned in
connection with a sale of the Company or Helius and the Executive terminates the
Executive’s employment with the Company following the six (6) month anniversary
of the completion of the sale transaction, the Executive shall be entitled to
receive severance pursuant to Section 5.1.1 of this Agreement. 

9.4.     Entire Agreement. This
Agreement represents the entire agreement of the parties and shall supersede any
and all previous contracts, arrangements or understandings between the Company
and the Executive. This Agreement may be amended at any time by mutual written
agreement and any statement contained in any employment manual memo or rule of
general applicability of the Company, this Agreement shall control. 

9.5.     Withholding. The payment of
any amount pursuant to this Agreement shall be subject to applicable withholding
and payroll taxes and such other deductions as may be required under the
Company’s of Helius’ employee benefit plans, if any. 

9.6.     Governing Law. This
Agreement shall be construed, interpreted and governed in accordance with the
laws of the Province of British Columbia and the federal laws of Canada
applicable therein without reference to rules relating to conflict of law. 

9.7.     Survival. Except as
otherwise specifically provided in this Agreement, all representations,
warranties, covenants, agreements and conditions contained in or made pursuant
to this Agreement shall survive until termination of this Agreement, except that
Sections 5, 7, 8, and 9 of this Agreement shall survive the termination of this
Agreement. 

9.8.      Submission to
Jurisdiction. Any action which may be brought in a court of law with respect
to this Agreement may be brought in the courts of the Province of British
Columbia, and the Executive accepts for himself and with respect to the
Executive’s property, generally and unconditionally, the jurisdiction of these
courts. The Executive irrevocably waives any objection, including, but not
limited to, any objection of the laying of venue or based on the grounds of
forum non conveniens, which the Executive may now or
hereafter have to the bringing of any action in those jurisdictions. 

9.9.     Waiver of Jury Trial. The
Executive waives any right to a trial by jury in any action to enforce or defend
any right under this Agreement or any amendment, instrument, document or
agreement delivered or to be delivered in connection with this Agreement or
arising from any employment relationship existing in connection with this
Agreement, and agrees that any action shall be tried before an arbitrator, as
outlined in Section 8, and not before a jury. 

9.10.     Attorney’ s Fees . In the
event either party brings an action to enforce any of the provisions of this
Agreement, the prevailing party shall be entitled to reasonable attorney’s fees,
expert witness fees and costs in addition to any other relief afforded by law.

[Signatures continued on next page] 

EXECUTION VERSION 

IN WITNESS WHEREOF, the Company has caused this Agreement to be
duly executed and the Executive has hereunto set the Executive’s hand, effective
as of the day and year first above written. 

	 	  	THE COMPANY: 
	 	 	 
	 	 	 
	 	  	Helius Medical Technologies (Canada), Inc.
      
	 	 	 
	 	 	 
	 	By: 	”Philippe Deschamps”
	 	 	 
	 	  	Philippe Deschamps 
	 	  	  
	 	 	 
	 	 	 
	 	  	EXECUTIVE: 
	 	 	 
	 	 	 
	 	By: 	”Brian
      Bapty”
	 	 	 
	 	  	Brian Bapty

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