Document:

ex10-23

 

Exhibit 10.23

MEMORANDUM OF AGREEMENT

	 	 	 
	BETWEEN	 	
STEVE FORGET, audioprosthesist, residing at 1183, Tecumseh, at
Dollard-des-Ormneaux, Province of Quebec;
	 
	 	 	
(hereinafter referred to as “Forget”)
	 
	AND	 	
MARTIN COUSINEAU, audioprosthesist, residing at 50, De Cheverny,
at Blainville, Province of Quebec;
	 
	 	 	
(hereinafter referred to as « Cousineau »)
	 
	AND	 	
HELIX HEARING CARE OF AMERICA CORP., a Canada corporation duly
constituted according to the Canada Business Corporations Act,
having its head office at 7100, Jean-Talon East, Suite 610,
Montreal QC, H1M 3S3, or any of its wholly-owned subsidiaries and
affiliates, represented herein by its duly authorized General
Counsel and Secretary, François Tellier;
	 
	 	 	
(hereinafter referred to as “Helix”)
	 
	AND	 	
HEARx LTD., a Delaware corporation, having its head office at
1250, Northpoint Parkway in West Palm Beach, Florida, represented
herein by its duly authorized President and Chief Operating
Officer, Steve Hansbrough;
	 
	 	 	
(hereinafter referred to as “HEARx”)

WHEREAS Forget, Cousineau, Richard Doucet and Luc Parent formed a partnership
(hereinafter the “Partnership”) on June 29th, 1992 in order to carry on and
regroup their professional audioprosthesist practices under the name of
Cousineau, Doucet, Parent, Forget s.e.n.c.;

WHEREAS Cousineau has decided to resign from all of his positions and titles in
and withdraw as a partner from the Partnership;

WHEREAS Cousineau has decided to transfer and/or sell all of his rights,
titles, interests and capital participation in the Partnership to Forget;

 

 

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WHEREAS Cousineau and Forget have agreed to the terms and conditions of this
resignation, withdrawal and transfer;

WHEREAS Cousineau is also an employee, officer, director and shareholder of
Helix and is a director of a number of its affiliates;

WHEREAS Cousineau has decided to resign from his positions as an employee,
officer and director of Helix and its affiliates and to renounce to any rights
he may have to similar positions with the entities resulting from the proposed
combination of Helix and HEARx (hereinafter the “Merged Entity” or “Merger”, as
the case may be);

WHEREAS Cousineau, Helix and HEARx have also agreed to the terms and conditions
of this resignation and renunciation;

WHEREFORE, THE PARTIES HEREBY CONFIRM THEIR AGREEMENTS WHICH ARE SUBJECT TO THE
FOLLOWING TERMS AND CONDITIONS:

	1)	 	That the preamble hereof forms an integral part of the present Memorandum
of Agreement.
	 
	2)	 	The closing date for the execution of the transactions and covenants
contemplated herein shall be the later of:

	 	(a)	 	March 31st, 2002; or
	 
	 	(b)	 	the date on which SCC consents to and provides the necessary
releases envisaged under this Memorandum of Agreement; or
	 
	 	(c)	 	the date upon which any other necessary releases or
approvals, regulatory or otherwise, are obtained and/or waived by
the parties;

	 	 	(hereinafter the “Closing Date”).
	 
	3)	 	Cousineau undertakes that on the Closing Date, he will irrevocably sell
and/or transfer to Forget all of Cousineau’s participation, capital and
other interests in the Partnership, both tangible and intangible, as well
as all of Cousineau’s participation, capital and other interests in the
partnership known as CDPF & Bernier (hereinafter “CDPF & Bernier”), as
well as all of his shares in the capital stock of Polyclinique de
l’Oreille Inc. (hereinafter the “Polyclinique) for the price of $1.00 and
such good and other valuable considerations provided herein;
	 
	4)	 	For such good and other valuable considerations provided herein,
Cousineau hereby agrees to resign from all of his titles and positions in
the Partnership, in CDPF & Bernier and in Polyclinique at the Closing
Date. Cousineau also agrees that he will renounce and

 

 

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	 	 	waive the right to any further arrears. Cousineau will be entitled to a
prorated share of profits from the Partnership and CDPF & Bernier from
the date of the present Memorandum of Agreement until the Closing Date,
which will be based on a total annual share of profits of $30,000 for the
Partnership and $15,000 for CDPF & Bernier. Cousineau will receive such
share of profits on the Closing Date.
	 
	5)	 	For such good and valuable considerations provided herein, Cousineau
further covenants that he will, at the Closing Date, execute standard
comprehensive releases in favour of Forget and the Partnership, CDPF &
Bernier and Polyclinique in which he will waive any and all claims,
demands or causes of action, whether past, present or future, which he may
have or have had against these partnerships, Polyclinique and Forget, and
which relate to these partnerships, Polyclinique or their related
accessory commercial activities.
	 
	6)	 	For such good and valuable considerations provided herein, Cousineau also
undertakes that, at the Closing Date, he will irrevocably resign from his
positions as an officer, director and employee of Helix and expressly and
irrevocably waive and renounce to any possible employee, officer or
director positions as well as any related benefit entitlements with and/or
from Helix and the Merged Entity, whether statutory or otherwise,
including any possible rights he may have or have had by virtue of the
“Termination of Rodriguez Employment Agreement and Establishment of New
Employment Agreements” document dated July 20th, 2001 and the Amended and
Restated Merger Agreement entered into between Helix and HEARx dated
November 6th, 200l and subsequent amendments thereto.
	 
	7)	 	For such good and valuable considerations provided herein, Cousineau also
undertakes that, at the Closing Date, he will provide Helix and HEARx
and/or the Merged Entity with standard comprehensive and final releases
from any and all claims, demands or causes of action, whether past,
present or future, which he may have or may have had against Helix or
HEARx arising from his employee, officer or director positions with these
companies or any of their subsidiaries or affiliates (save and except
possible claims and recourses stemming from the non-competition covenants
set forth in paragraph 20 herein);
	 
	8)	 	For such good and valuable considerations provided herein, Cousineau
agrees and undertakes to enter into a voting trust agreement to be signed
on the effective date of the anticipated merger between HEARx and Helix,
pursuant to which he shall grant an irrevocable proxy in favour of Mr.
Steve Hansbrough to vote all of the common shares of the capital stock
Cousineau holds or later holds in the Merged Entity, for a period of two
years from the effective date of the merger. This irrevocable proxy will
however not extend or apply to any vote of the shareholders of the Merged
Entity, which is sought in respect of any subsequent merger, dissolution,
reverse stock split or stock dilution (more than 20%) proposals.
Cousineau will further agree not to take any actions or proceedings, in
his capacity as a shareholder, or assist other shareholders of the Merged
Entity in doing so for the same period.

 

 

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	9)	 	Forget undertakes that, on the Closing Date, he will cause the
Partnership to sell and/or transfer all of its rights, titles and
interests in two of the clinics it currently owns and operates and which
are located at 2900 Dionne Blvd., Suite 101, in St-George de Beauce (the
“St-George Clinic”) and at 760 Vachon Blvd. in Ste-Marie de Beauce (the
“Ste-Marie Clinic”), to Cousineau, for the price of $1.00 and such good
and other valuable considerations provided herein, subject to the
following terms and conditions:

	 	(a)	 	All employees currently employed at the St-George and
Ste-Marie Clinics shall be terminated by the Partnership,
Polyclinique and/or Helix, as the case may be, upon the Closing
Date, and all such employees shall be immediately rehired by
Cousineau, or a partnership to be named by him. Helix and/or the
Partnership will assume all costs, bonuses, P.T.O., vacation pay and
expenses, if any, related to the termination of said employees.
Cousineau will assume all salaries, bonuses, P.T.O., vacation pay,
costs and other employee expenses after the Closing Date;
	 
	 	(b)	 	The transfer/sale shall also include all patient files
related to the operation of the St-George and Ste-Marie Clinics;
	 
	 	(c)	 	The transfer/sale to Cousineau will include any and all
rights to the telephone numbers currently in use in the St-George
and Ste-Marie Clinics;
	 
	 	(d)	 	Following a transition period which will end no later than
ninety (90) days following the Closing Date, Cousineau agrees he
will conduct all professional services and operate all accessory
commercial services at the St-George and Ste-Marie Clinics, and
anywhere else in the Beauce region, as defined and marked in the map
annexed as Schedule “A” of this Memorandum of Agreement (“Beauce
Region”) under his own or a new name only, excluding any business
names similar or related to, or previously utilized by, the
Partnership and/or Helix prior to the Closing Date;
	 
	 	(e)	 	The transfer/sale shall exclude all accounts receivable and
accounts payable related to the St-George and Ste-Marie Clinics
which are booked as of the Closing Date. The excluded accounts
receivable pertaining to hearing aids will be limited to those
products which have been delivered on or before the Closing Date.
Conversely, the accounts payable to be excluded from the
sale/transfer will only extend to the products purchased and
delivered as of the Closing Date;
	 
	 	(f)	 	Cousineau undertakes to execute a comprehensive
non-competition and solicitation agreement with Forget and/or the
Partnership on the Closing Date, in which he will undertake not to
compete directly or indirectly with any of the clinics currently
operated by the Partnership, CDPF & Bernier and Polyclinique, and
not to solicit any of their employees, doctors or patients, for a
period of three (3) years from March 31st, 2002 and further agrees
that all professional audioprosthesist and related commercial
activities to be carried on by him directly or indirectly through
the St-George or Ste-Marie Clinics, or otherwise, will be

 

 

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	 	 	 	limited to the territory corresponding to the Beauce region.
However, Cousineau agrees not to open any clinic in the Town of Lac
Mégantic. The non-compete will recognize the limited ninety-day
transitional use of name period set forth in sub-paragraph 9(d)
herein. Subject to sub-paragraph 9(g) herein, the non-compete will
permit Cousineau to adhere and participate in buying group
activities, solely in order to purchase and resell applicable
hearing aid products. Cousineau will also be permitted to solicit
professionals outside the Beauce region (but excluding any
professional working for the Partnership, CDPF & Bernier and
Polyclinique), solely for the purpose of replacing and adding
professionals within the Beauce territory based on need;
	 
	 	(g)	 	Cousineau agrees that so long as he retains any ownership
and/or partnership interest in the St-George and Ste-Marie Clinics,
or any other clinic in the Beauce region, he guarantees that these
Clinics or entities will purchase at least 50% of their total volume
of hearing aid products from Siemens Hearing Instruments for a
period of two (2) years following the Closing Date. Cousineau,
directly or indirectly, will benefit from the same purchase and
payment terms, at competitive’s prices for the Quebec market, as
those granted by Siemens to Helix during this period, subject to
Siemens’s approval, failing which Cousineau will not be obliged to
purchase such products from Siemens. Siemens will have to maintain
its authorized supplier status under the RAMQ program;
	 
	 	(h)	 	From the Closing Date and for a period of two (2) years
thereafter, Cousineau shall grant Forget and/or the Partnership a
right of first priority to purchase all or the control of
Cousineau’s rights, titles and ownership or partnership interests in
the St-George and Ste-Marie Clinics or any successors thereof,
before contemplating the acceptance or tender of any offer or
agreement to sell, transfer or convey his interests therein from or
to any third parties (save and except to family members of
Cousineau). In the event Cousineau sells or transfers his
controlling interest in the Clinics to a family member or third
party, then such family member and third party will have to accept
to be bound by this right of first priority in favour of the
Partnership and Forget. In addition to the foregoing, Cousineau
agrees that he will maintain at least a 51% ownership stake or
participation interest in the St-George and Ste-Marie Clinics, or
successors thereof, subject of course to the trigger or exercise of
the above right of first priority;
	 
	 	(i)	 	Forget will, on the Closing Date, cause Polyclinique to
jointly assign with Helix the St-George Clinic lease to Cousineau,
who shall assume all of the terms, conditions and obligations
thereof to the complete exoneration of Helix and Polyclinique.
Cousineau undertakes that he will indemnify and hold harmless Helix
and Polyclinique for any and all demands, claims or liabilities in
relation to such lease and the professional practices and corollary
business conducted at this Clinic, as of the date of such
assignment.

 

 

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	10)	 	In consideration of Cousineau’s covenants set forth in paragraphs 6), 7)
and 8) herein, Helix undertakes that it or the Merged Entity will, on the
Closing Date:

	 	(a)	 	grant to Cousineau a license to use the software known as
“Audiosoft Quebec”, at the St-George and Ste-Marie Clinics and in
the Beauce Region at no cost for a period of three (3) years from
the Closing Date. Said license will be set forth in writing by
agreement which will expressly recognize that Helix’s exclusive
intellectual property rights in this software will not, in any
manner, be diminished or affected by this license, and which will
further set forth usual and standard provisions in order to fully
protect these rights;
	 
	 	(b)	 	transfer to Cousineau all of the equipment, inventory, office
furniture and fixtures, leasehold improvements, office materials and
supplies used in the St-George and Ste-Marie Clinics, on the Closing
Date, net of any debt in respect thereof. Alternatively, Helix will
assume and hold Cousineau harmless from any such remaining debt on
the Closing Date;
	 
	 	(c)	 	assign the Ste-Marie Clinic lease and jointly assign with
Polyclinique the St-George Clinic lease to Cousineau, who shall
assume all of the terms, conditions and obligations thereof to the
complete exoneration of Helix and/or Polyclinique, as the case may
be. These assignments will however be subject and conditional on
Cousineau’s undertaking to indemnify and hold harmless Helix and/or
Polyclinique from any and all demands, claims or liabilities in
relation to these leases and the occupation, corollary business and
professional practices conducted at the premises as of the Closing
Date. Cousineau will also undertake to assume full and exclusive
responsibility for the payment of all utilities and related costs of
these Clinics from the same date;
	 
	 	(d)	 	provide to Cousineau standard comprehensive and final
releases from any and all claims, demands or causes of action
whatsoever, whether past, present or future, which either may have
or may have had against Cousineau, arising from his employee,
officer or director positions with Helix or any of its subsidiaries
or affiliates. For the sake of clarity, the parties expressly
acknowledge that the above releases will not extend to any claims,
demands or causes of action arising from a breach of Cousineau’s
shareholder or stockholder commitments or duties, statutory,
contractual or otherwise, including, but not limited to, all of his
irrevocable proxy commitments and covenants not to jeopardize the
Merger, contracted in favour of Helix and HEARx;
	 
	 	(e)	 	Helix further undertakes that it will continue to pay
Cousineau at an annual salary of $125,000 by year and his current
fringe benefits until the Closing Date, notwithstanding that
Cousineau agrees to leave the premises of Helix as of the date of
the present Memorandum of Agreement or very shortly thereafter once
all transitional matters have been resolved expeditiously to Helix’s
satisfaction. Cousineau’s earlier departure from the premises of
Helix will not be construed as a

 

 

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	 	 	 	resignation or termination of employment prior to the execution of
the necessary documents attesting to such resignation on the
Closing Date.

	11)	 	As further consideration for Cousineau’s covenants set forth in
paragraphs 3) and 4) herein, Forget will cause the Partnership to assume
Cousineau’s tax liability stemming from his share of Partnership income
for the financial year starting April 1st, 2001 and ending March 31st,
2002. Forget will also cause the Partnership, CDPF & Bernier and
Polyclinique to assume a capped portion of the tax liability which could
be definitively assessed against Cousineau as a result of the
sale/transfer of his interests in Polyclinique and these partnerships to
Forget. However, this assumption will never, under any circumstances,
exceed a maximum, aggregate and total sum of $25,000 for all three (3)
transfers combined.
	 
	12)	 	As further and partial consideration for Cousineau’s covenants set forth
in paragraphs 3) and 4) herein, Forget will transfer to Cousineau one
third of his vested interest in Immobec Inc., through which the partners
in the Partnership own real estate property located in Rimouski.
	 
	13)	 	Forget also undertakes to sign the necessary documents to direct that the
life insurance policy subscribed by the Partnership with Assurance-Vie
Desjardins Laurentienne, on the life of Cousineau, including any residual
value rights, will be irrevocably transferred to Cousineau or his nominee
beneficiaries. Cousineau will assume all tax consequences stemming from
this transfer, including any assessments levied against the Partnerhip.
	 
	14)	 	As consideration for Cousineau’s covenants set forth in paragraph 5)
herein, Forget undertakes that he will execute and will cause the
Partnership, CDPF & Bernier and Polyclinique to execute a standard
comprehensive release in favour of Cousineau, in which they will waive any
and all claims, demands, causes of action, whether past, present or future
(save and except any possible claims and recourses stemming from his gross
negligence or his violation of the non-competition, hold harmless and
other surviving covenants set forth in the present Memorandum of
Agreement), which they have or may have had against him arising from his
activities and interests in these partnerships.
	 
	15)	 	Cousineau also hereby undertakes to sign and execute, at the Closing
Date, the agreements and ancillary documents to be finalized in the
context of the dissolution of 3319725 Canada Inc. (hereinafter
“BufferCo”), as amended to reflect the specific and separate agreements to
be concluded by Forget with both Richard Doucet and Luc Parent in this
regard on February 28th, 2002. More specifically, but without limitation.
Cousineau hereby agrees that, as a result of the BufferCo dissolution,
Forget will first be transferred 215 000 common shares of Helix.
Cousineau also agrees to transfer to Forget 75,000 common shares of Helix.
Cousineau agrees to waive any entitlement he may have to obtain a penalty
redistribution and transfer of a portion of Parent’s shares in BufferCo in
the context of the dissolution thereof, which represents a total of 83,333
common shares of Helix. On the other hand, the parties agree that Forget
shall receive Parent’s penalty in the amount of 83,333 common shares.

 

 

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	16)	 	This Memorandum of Agreement, and the additional agreements and documents
to be subsequently executed pursuant thereto, are subject to the approval
of the respective Boards of Directors of Helix and HEARx, and are also
subject to any and all other necessary regulatory or creditor approvals
and other third party consents and releases. Only Helix and Forget and
their advisors will take any and all required steps to obtain such
consents and releases.
	 
	17)	 	Except for paragraph 8) herein, this Memorandum of Agreement, and the
additional agreements and documents to be subsequently executed pursuant
thereto, will not be conditional on the consummation of the anticipated
Merger between Helix and HEARx, unless regulatory approval of the merger
cannot be obtained without reviewing and/or effecting modifications to
this Memorandum. In such circumstances, the parties agree to further
discuss and negotiate in good faith any such changes.
	 
	18)	 	This Memorandum of Agreement is also conditional on the definitive and
final execution of separate agreements by Forget with Richard Doucet and
Luc Parent respectively as regards the sale, transfer of each of their
respective participation, capital and interests in the Partnership, CDPF
and Bernier, and Polyclinique, to Forget, as well as their execution of
the BufferCo dissolution documentation, on terms and conditions acceptable
to Forget.
	 
	19)	 	Cousineau hereby agrees and recognizes that Forget fully intends to
continue the Partnership and adjoin new partners thereto, and that the
execution of the covenants and undertakings set forth therein will not,
under any circumstances, result in a dissolution of the Partnership,
notwithstanding any provisions of the June 29th, 1992 Partnership
Agreement. Cousineau further undertakes that he will not, in any manner,
whether directly or indirectly, do anything to precipitate or cause or
support any effort or activity which may bring about the dissolution of
the Partnership.
	 
	20)	 	Forget, the Partnerships, CDPF & Bernier, Polyclinique, Helix and Hearx
undertake to execute a comprehensive non-competition and solicitation
agreement with Cousineau at the Closing Date , in which they will
undertake not to compete directly or indirectly Cousineau in the Beauce
region on the same terms set forth in sub-paragraph 9f) with the necessary
adaptations.
	 
	21)	 	The parties hereby agree and undertake to sign and execute any and all
further and necessary documents, undertakings, agreements, deeds and
releases, in order to give full force and effect to the covenants and
terms set forth in this Memorandum of Agreement.
	 
	22)	 	The parties hereby agree and recognize that the present Memorandum of
Agreement will be fully binding on their successors and/or assigns.
	 
	23)	 	The parties agree that this Memorandum is and will remain confidential,
and will not be disclosed in whole or in part, whether directly or
indirectly, to any third parties, save and except any representatives of
third parties whose consent to this Memorandum may be required.
	 
	24)	 	If any term or other provision of this Agrement is invalid, illegal or
incapable of being enforced by any rule or law, or public policy, all
other conditions and provisions of this

 

 

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	 	 	Agreement shall nevertheless remain in full force and effect so long as
the economic or legal substance of the transactions contemplated hereby
is not affected in any manner materially adverse to any party. Upon such
determination that any term or other provision is invalid, illegal or
incapable of being enforced, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner to the end that
the transactions contemplated hereby are fulfilled to the fullest extent
possible.
	 
	25)	 	This Memorandum of Agreement is governed by and will be construed in
accordance with the laws of the Province of Québec and the laws of Canada
applicable therein.
	 
	26)	 	Save and except for the BufferCo documentation, which shall be borne by
Steve Forget, Luc Parent, Martin Cousineau and Richard Doucet, Helix
and/or the Merger Entity shall provide the documents to be executed and
delivered pursuant to this Memorandum of Agreement at the Closing Date.
However, each party will pay its own attorneys fees and disbursements.
	 
	27)	 	The parties have requested that this Memorandum of Agreement be drafted
in the English language. Les parties ont exigé que cette convention soit
rédigée dans la langue anglaise.

IN WITNESS THEREOF, THE PARTIES HAVE SIGNED THE PRESENT MEMORANDUM THIS 28th
DAY OF FEBRUARY 2002.

/s/ STEVE FORGET

Steve Forget

/s/ MARTIN COUSINEAU

Martin Cousineau

HELIX HEARING CARE OF AMERICA CORP.

/s/ STEVE FORGET

By: Steve Forget

Its:

HEARx LTD.

/s/ STEVE HANSBROUGH

By: Steve Hansbrough

Its: President and C.O.O.ex10-24

 

Exhibit 10.24

MEMORANDUM OF AGREEMENT

	 	 	 
	BETWEEN	 	
STEVE FORGET, audioprosthesist, residing at 1183, Tecumseh,
Dollard-des-Ormeaux, Province of Quebec;
	 
	 	 	
(hereinafter referred to as “Forget”)
	 
	AND	 	
RICHARD DOUCET, audioprosthesist, residing at 1589, Du Chevrotin,
Longueuil, Province of Quebec;
	 
	 	 	
(hereinafter referred to as “Doucet”)
	 
	AND	 	
HELIX HEARING CARE OF AMERICA CORP., a Canada corporation duly
constituted according to the Canada Business Corporations Act,
having its head office at 7100, Jean-Talon East, Suite 610,
Montreal QC, H1M 3S3, or any of its wholly-owned subsidiaries and
affiliates, represented herein by its duly authorized General
Counsel and Secretary, François Tellier;
	 
	 	 	
(hereinafter referred to as “Helix”)
	 
	AND	 	
HEARx LTD., a Delaware corporation, having its head office at
1250, Northpoint Parkway in West Palm Beach, Florida, represented
herein by its duly authorized President and Chief Operating
Officer, Steve Hansbrough;
	 
	 	 	
(hereinafter referred to as “HEARx”)

WHEREAS Forget, Doucet, Martin Cousineau and Luc Parent formed a partnership
(hereinafter the “Partnership”) on June 29th, 1992 in order to carry on and
regroup their professional audioprosthesist practices under the name of
Cousineau, Doucet, Parent, Forget s.e.n.c.;

WHEREAS Doucet has decided to resign from all of his positions and titles in
and withdraw as a partner from the Partnership;

WHEREAS Doucet has decided to transfer and/or sell all of his rights, titles,
interests and capital participation in the Partnership to Forget;

 

 

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WHEREAS Doucet and Forget have agreed to the terms and conditions of this
resignation, withdrawal and transfer;

WHEREAS Doucet is also an employee, officer and shareholder of Helix;

WHEREAS Doucet has decided to resign from his positions as an employee and
officer of Helix and as a director of any of its affiliates, and to renounce to
any rights he may have to similar positions with the entities resulting from
the proposed combination of Helix and HEARx (hereinafter the “Merged Entity” or
“Merger”, as the case may be);

WHEREAS Doucet, Helix and HEARx have also agreed to the terms and conditions of
this resignation and renunciation;

WHEREFORE, THE PARTIES HEREBY CONFIRM THEIR AGREEMENTS WHICH ARE SUBJECT TO THE
FOLLOWING TERMS AND CONDITIONS:

	1)	 	That the preamble hereof forms an integral part of the present Memorandum
of Agreement.
	 
	2)	 	The closing date for the execution of the transactions and covenants
contemplated herein shall be the later of:

	 	(a)	 	March 31st, 2002; or
	 
	 	(b)	 	the date on which SCC consents to and provides the necessary
releases envisaged under this Memorandum of Agreement; or
	 
	 	(c)	 	the date upon which any other necessary releases or
approvals, regulatory or otherwise, are obtained and/or waived by
the parties;

	 	 	(hereinafter the “Closing Date”).
	 
	3)	 	Doucet undertakes that on the Closing Date, he will irrevocably sell
and/or transfer to Forget all of Doucet’s participation, capital and other
interests in the Partnership, both tangible and intangible, as well as all
of Doucet’s participation, capital and other interests in the partnership
known as CDPF & Bernier (hereinafter “CDPF & Bernier”), as well as all of
his shares in the capital stock of Polyclinique de l’Oreille Inc.
(hereinafter the “Polyclinique) for the price of $1.00 and such good and
other valuable considerations provided herein.
	 
	4)	 	For such good and other valuable considerations provided herein, Doucet
hereby agrees to resign from all of his titles and positions in the
Partnership, in CDPF & Bernier and in Polyclinique at the Closing Date.
Doucet also agrees that he will renounce and waive the right to any
further arrears. Doucet will be entitled to a prorated share of profits
from the

 

 

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	 	 	Partnership and CDPF & Bernier from the date of the present Memorandum of
Agreement until the Closing Date, which will be based on a total annual
share of profits of $30,000 for the Partnership and $15,000 for CDPF &
Bernier. Doucet will receive such share of profits on the Closing Date.
	 
	5)	 	For such good and other valuable considerations provided herein, Doucet
further covenants that he will, at the Closing Date, execute standard
comprehensive releases in favour of Forget and the Partnership, CDPF &
Bernier and Polyclinique in which he will waive any and all claims,
demands or causes of action, whether past, present or future, which he may
have or have had against these partnerships, Polyclinique and Forget, and
which relate to these partnerships, Polyclinique or their related
accessory commercial activities.
	 
	6)	 	For such good and other valuable considerations provided herein, Doucet
also undertakes that, at the Closing Date, he will irrevocably resign from
his positions as an officer and employee of Helix and expressly and
irrevocably waive and renounce to any possible employee or officer
positions as well as any related benefit entitlements with and/or from
Helix and the Merged Entity, whether statutory or otherwise, including any
possible rights he may have or have had by virtue of the “Termination of
Rodriguez Employment Agreement and Establishment of New Employment
Agreements” document dated July 20th, 2001 and the Amended and Restated
Merger Agreement entered into between Helix and HEARx dated November 6th,
200l and subsequent amendments thereto.
	 
	7)	 	For such good and other valuable considerations provided herein, Doucet
also undertakes that, at the Closing Date, he will provide Helix and HEARx
and/or the Merged Entity with standard comprehensive and final releases
from any and all claims, demands or causes of action, whether past,
present or future, which he may have or may have had against Helix or
HEARx arising from his employee or officer positions with these companies
or any of their subsidiaries or affiliates (save and except any possible
claims and recourses stemming from the non-competition covenants set forth
in paragraph 20 herein).
	 
	8)	 	For such good and other valuable considerations provided herein, Doucet
agrees and undertakes to enter into a voting trust agreement to be signed
on the effective date of the anticipated merger between HEARx and Helix,
pursuant to which he shall grant an irrevocable proxy in favour of Mr.
Steve Hansbrough to vote all of the common shares of the capital stock
Doucet holds or later holds in the Merged Entity, for a period of two
years from the effective date of the merger. This irrevocable proxy will
however not extend or apply to any vote of the shareholders of the Merged
Entity, which is sought in respect of any subsequent merger, dissolution,
reverse stock split or stock dilution (more than 20%) proposals. Doucet
will further agree not to take any actions or proceedings, in his capacity
as a shareholder, or assist other shareholders of the Merged Entity in
doing so for the same period.
	 
	9)	 	Forget undertakes that, on the Closing Date, he will cause the
Partnership to sell and/or transfer all of its rights, titles and
interests in two of the clinics it currently owns and

 

 

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	 	 	operates and which are located at 1615 Jacques-Cartier Street, Suite 370,
in Longueuil (the “Longueuil Clinic”) and at 265 Churchill Street in
Greenfield Park (the “Greenfield Park Clinic”), to Doucet, for the price
of $1.00 and such good and other valuable considerations provided herein,
subject to the following terms and conditions:

	 	(a)	 	All employees currently employed at the Longueuil and
Greenfield Park Clinics shall be terminated by the Partnership,
Polyclinique and/or Helix, as the case may be, upon the Closing
Date, and all such employees [except Pierre Gauthier and Guylaine
Lagrandeur] shall be immediately rehired by Doucet, or a partnership
to be named by him. Helix and/or the Partnership will assume all
costs, bonuses, P.T.O., vacation pay and expenses, if any, related
to the termination of said employees. Doucet will assume all
salaries, bonuses, P.T.O., vacation pay, costs and other employee
expenses after the Closing Date;
	 
	 	(b)	 	The transfer/sale shall also include all patient files
related to the operation of the Longueuil and Greenfield Park
Clinics;
	 
	 	(c)	 	The transfer/sale to Doucet will include any and all rights
to the telephone numbers currently in use in the Longueuil and
Greenfield Park Clinics;
	 
	 	(d)	 	Following a transition period which will end by no later than
ninety (90) days following the Closing Date, Doucet agrees he will
conduct all professional services and operate all accessory
commercial services at the Longueuil and Greenfield Park Clinics,
and anywhere else in the territory defined and marked in the map
annexed as Schedule “A” of this Memorandum Agreement (“Longueuil
Region”)under his own or a new name only, excluding any business
names similar or related to, or previously utilized by, the
Partnership and/or Helix prior to the Closing Date;
	 
	 	(e)	 	The transfer/sale shall exclude all accounts receivable and
accounts payable related to the Longueuil and Greenfield Park
Clinics which are booked as of the Closing Date. The excluded
accounts receivable pertaining to hearing aids will be limited to
those products which have been delivered on or before the Closing
Date. Conversely, the accounts payable to be excluded from the
sale/transfer will only extend to the products purchased and
delivered as of the Closing Date;
	 
	 	(f)	 	Doucet undertakes to execute a comprehensive non-competition
and solicitation agreement with Forget and/or the Partnership on the
Closing Date, in which he will undertake not to compete directly or
indirectly with any of the clinics currently operated by the
Partnership, CDPF & Bernier and Polyclinique, and not to solicit any
of their employees, doctors or patients, for a period of three (3)
years from March 31st, 2002, and further agrees that all
professional audioprosthesist and related commercial activities to
be carried on by him directly or indirectly through the Longueuil
and Greenfield Park Clinics, or otherwise, will be limited to the
territory corresponding to the Longueuil Region. The non-compete
will

 

 

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	 	 	 	recognize the limited ninety-day transitional use of name period
set forth in sub-paragraph 9(d) herein. Subject to sub-paragraph
9(g) herein, the non-compete will permit Doucet to adhere and
participate in buying group activities, solely in order to purchase
and resell applicable hearing aid products. Doucet will also be
permitted to solicit professionals outside the Longueuil Region
(but excluding any professional working for the Partnership, CDPF &
Bernier and Polyclinique), solely for the purpose of replacing and
adding professionals within the Longueuil Region based on need;
	 
	 	(g)	 	Doucet agrees that so long as he retains any ownership and/or
partnership interest in the Longueuil and Greenfield Park Clinics,
or any other clinic within the Longueuil Region, he guarantees that
these Clinics or entities will purchase at least 50% of their total
volume of hearing aid products from Siemens Hearing Instruments for
a period of two (2) years following the Closing Date. Doucet,
directly or indirectly, will benefit from the same purchase and
payment terms, at competitives prices for the Quebec market, as
those granted by Siemens to Helix during this period, subject to
Siemens’s approval, failing which Doucet will not be obliged to
purchase such products from Siemens. Siemens will have to maintain
its authorized supplier status under the RAMQ program;
	 
	 	(h)	 	From the Closing Date and for a period of two (2) years
thereafter, Doucet shall grant Forget and/or the Partnership a right
of first priority to purchase all or the control of Doucet’s rights,
titles and ownership or partnership interests in the Longueuil and
Greenfield Park Clinics or any successors thereof, before
contemplating the acceptance or tender of any offer or agreement to
sell, transfer or convey his interests therein from or to any third
parties(save and except to family members of Doucet, excluding Luc
Parent). In the event Doucet sells or transfers his controlling
interest in the Clinics to a family member or third party, then such
family member and third party will have to accept to be bound by
this right of first priority in favor of the Partnership and Forget.
In addition to the foregoing, Doucet agrees that he will maintain
at least a 51% ownership stake or participation interest in the
Longueuil and Greenfield Park Clinics, or successors thereof,
subject of course to the trigger or exercise of the above right of
first priority;
	 
	 	(i)	 	Forget will, on the Closing Date, cause Polyclinique to
jointly assign with Helix the Longueuil Clinic lease to Doucet, who
shall assume all of the terms, conditions and obligations thereof to
the complete exoneration of Helix and Polyclinique. Doucet
undertakes that he will indemnify and hold harmless Helix and
Polyclinique for any and all demands, claims or liabilities in
relation to such lease and the professional practices and corollary
business conducted at this Clinic, as of the date of such
assignment.

	10)	 	In consideration of Doucet’s covenants set forth in paragraphs 6), 7) and
8) herein, Helix undertakes that it or the Merged Entity will, on the
Closing Date:

 

 

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	 	(a)	 	grant to Doucet a license to use the software known as
“Audiosoft Quebec”, at the Longueuil and Greenfield Park Clinics and
in the Longueuil Region at no cost for a period of three (3) years
from the Closing Date. Said license will be set forth in writing by
agreement which will expressly recognize that Helix’s exclusive
intellectual property rights in this software will not, in any
manner, be diminished or affected by this license, and which will
further set forth usual and standard provisions in order to fully
protect these rights;
	 
	 	(b)	 	transfer to Doucet all of the equipment, inventory, office
furniture and fixtures, leasehold improvements, office materials and
supplies used in the Longueuil and Greenfield Park Clinics, on the
Closing Date, net of any debt in respect thereof. Alternatively,
Helix will assume and hold Doucet harmless from any such remaining
debt on the Closing Date;
	 
	 	(c)	 	assign the Greenfield Park Clinic lease and jointly assign
with Polyclinique the Longueuil Clinic lease to Doucet, who shall
assume all of the terms, conditions and obligations thereof to the
complete exoneration of Helix and/or Polyclinique, as the case may
be. These assignments will however be subject and conditional on
Doucet’s undertaking to indemnify and hold harmless Helix and/or
Polyclinique from any and all demands, claims or liabilities in
relation to these leases and the occupation, corollary business and
professional practices conducted at the premises as of the Closing
Date. Doucet will also undertake to assume full and exclusive
responsibility for the payment of all utilities and related costs of
these Clinics from the same date;
	 
	 	(d)	 	provide to Doucet standard comprehensive and final releases
from any and all claims, demands or causes of action whatsoever,
whether past, present or future, which either may have or may have
had against Doucet, arising from his employee or officer positions
with Helix or any of its subsidiaries or affiliates. For the sake
of clarity, the parties expressly acknowledge that the above
releases will not extend to any claims, demands or causes of action
arising from a breach of Doucet’s shareholder or stockholder
commitments or duties, statutory, contractual or otherwise,
including, but not limited to, all of his irrevocable proxy
commitments and covenants not to jeopardize the Merger, contracted
in favour of Helix and HEARx;
	 
	 	(e)	 	Helix further undertakes that it will continue to pay Doucet
at an annual salary of $87,000 by year and his current fringe
benefits until the Closing Date, notwithstanding that Doucet agrees
to leave the premises of Helix as of the date of the present
Memorandum of Agreement or very shortly thereafter once all
transitional matters have been resolved expeditiously to Helix’s
satisfaction. Doucet’s earlier departure from the premises of Helix
will not be construed as a resignation or termination of employment
prior to the execution of the necessary documents attesting to such
resignation on the Closing Date.

 

 

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	11)	 	As further consideration for Doucet’s covenants set forth in paragraphs
3) and 4) herein, Forget will cause the Partnership to assume Doucet’s tax
liability stemming from his share of Partnership income for the financial
year starting April 1st, 2001 and ending March 31st, 2002. Forget will
also cause the Partnership, CDPF & Bernier and Polyclinique to assume a
capped portion of the tax liability which could be definitively assessed
against Doucet as a result of the sale/transfer of his interests in
Polyclinique and these partnerships to Forget. However, this assumption
will never, under any circumstances, exceed a maximum, aggregate and total
sum of $25,000 for all three (3) transfers combined.
	 
	12)	 	As further and partial consideration for Doucet’s covenants set forth in
paragraphs 3) and 4) herein, Forget will transfer to Doucet one third of
his vested interest in Immobec Inc., through which the partners in the
Partnership own real estate property located in Rimouski.
	 
	13)	 	Forget also undertakes to sign the necessary documents to direct that the
life insurance policy subscribed by the Partnership with Assurance-Vie
Desjardins Laurentienne, on the life of Doucet, including any residual
value rights, will be irrevocably transferred to Doucet or his nominee
beneficiaries . Doucet will assume all tax consequences stemming from
this transfer, including any assessments levied against the Partnership.
	 
	14)	 	As consideration for Doucet’s covenants set forth in paragraph 5) herein,
Forget undertakes that he will execute and will cause the Partnership,
CDPF & Bernier and Polyclinique to execute a standard comprehensive
release in favour of Doucet, in which they will waive any and all claims,
demands, causes of action, whether past, present or future (save and
except any possible claims and recourses stemming from his gross
negligence or his violation of the non-competition, hold harmless and
other surviving covenants set forth in the present Memorandum of
Agreement), which they have or may have had against him arising from his
activities and interests in these partnerships.
	 
	15)	 	Doucet also hereby undertakes to sign and execute, at the Closing Date,
the agreements and ancillary documents to be finalized in the context of
the dissolution of 3319725 Canada Inc. (hereinafter “BufferCo”), as
amended to reflect the specific and separate agreements to be concluded by
Forget with both Martin Cousineau and Luc Parent in this regard on
February 28th, 2002. More specifically, but without limitation, Doucet
hereby agrees that, as a result of the BufferCo dissolution, Forget will
first be transferred 215 000 common shares of Helix. Doucet also agrees
to transfer to Forget 75,000 common shares of Helix. Doucet agrees to
waive any entitlement he may have to obtain a penalty redistribution and
transfer of a portion of Parent’s shares in BufferCo in the context of the
dissolution thereof, which represents a total of 83,333 common shares of
Helix. On the other hand, the parties agree that Forget shall receive
Parent’s penalty in the amount of 83,333 common shares.
	 
	16)	 	This Memorandum of Agreement, and the additional agreements and documents
to be subsequently executed pursuant thereto, are subject to the approval
of the respective Boards of Directors of Helix and HEARx, and are also
subject to any and all other

 

 

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	 	 	necessary regulatory or creditor approvals and other third party consents
and releases. Only Helix and Forget and their advisors will take any and
all required steps to obtain such consents and releases.
	 
	17)	 	Except for paragraph 8) herein, this Memorandum of Agreement, and the
additional agreements and documents to be subsequently executed pursuant
thereto, will not be conditional on the consummation of the anticipated
Merger between Helix and HEARx, unless regulatory approval of the merger
cannot be obtained without reviewing and/or effecting modifications to
this Memorandum. In such circumstances, the parties agree to further
discuss and negotiate in good faith any such changes.
	 
	18)	 	This Memorandum of Agreement is also conditional on the definitive and
final execution of separate agreements by Forget with Martin Cousineau and
Luc Parent respectively as regards the sale, transfer of each of their
respective participation, capital and interests in the Partnership, CDPF
and Bernier, and Polyclinique, to Forget, as well as their execution of
the BufferCo dissolution documentation, on terms and conditions acceptable
to Forget.
	 
	19)	 	Doucet hereby agrees and recognizes that Forget fully intends to continue
the Partnership and adjoin new partners thereto, and that the execution of
the covenants and undertakings set forth therein will not, under any
circumstances, result in a dissolution of the Partnership, notwithstanding
any provisions of the June 29th, 1992 Partnership Agreement. Doucet
further undertakes that he will not, in any manner, whether directly or
indirectly, do anything to precipitate or cause or support any effort or
activity which may bring about the dissolution of the Partnership.
	 
	20)	 	Forget, the Partnerships, CDPF & Bernier, Polyclinique, Helix and Hearx
undertake to execute a comprehensive non-competition and solicitation
agreement with Doucet at the Closing Date, in which they will undertake
not to compete directly or indirectly Doucet in the Longueuil region on
the same terms set forth in sub-paragraph 9f) with the necessary
adaptations.
	 
	20)	 	The parties hereby agree and undertake to sign and execute any and all
further and necessary documents, undertakings, agreements, deeds and
releases, in order to give full force and effect to the covenants and
terms set forth in this Memorandum of Agreement.
	 
	21)	 	The parties hereby agree and recognize that the present Memorandum of
Agreement will be fully binding on their successors and/or assigns.
	 
	22)	 	The parties agree that this Memorandum is and will remain confidential,
and will not be disclosed in whole or in part, whether directly or
indirectly, to any third parties, save and except any representatives of
third parties whose consent to this Memorandum may be required.
	 
	23)	 	If any term or other provision of this Agrement is invalid, illegal or
incapable of being enforced by any rule or law, or public policy, all
other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance
of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good

 

 

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	 	 	faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner to the end that
the transactions contemplated hereby are fulfilled to the fullest extent
possible.
	 
	24)	 	This Memorandum of Agreement is governed by and will be construed in
accordance with the laws of the Province of Québec and the laws of Canada
applicable therein.
	 
	25)	 	Save and except for the BufferCo documentation, which shall be borne by
Steve Forget, Luc Parent, Martin Cousineau and Richard Doucet, Helix
and/or the Merger Entity shall provide the documents to be executed and
delivered pursuant to this Memorandum of Agreement at the Closing Date.
However, each party will pay its own attorneys fees and disbursements.
	 
	26)	 	The parties have requested that this Memorandum of Agreement be drafted
in the English language. Les parties ont exigé que cette convention soit
rédigée dans la langue anglaise.

IN WITNESS THEREOF, THE PARTIES HAVE SIGNED THE PRESENT MEMORANDUM THIS 28th
DAY OF FEBRUARY 2002.

/s/ STEVE FORGET

Steve Forget

/s/ RICHARD DOUCET

Richard Doucet

HELIX HEARING CARE OF AMERICA CORP.

/s/ STEVE FORGET

By: Steve Forget

Its: President

HEARx LTD.

/s/ STEVE HANSBROUGH

By: Steve Hansbrough

Its: President and C.O.O.

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