Document:

ex10_1.htm

    
      

    

    Exhibit
10.1

    

    AMENDED
AND RESTATED EMPLOYMENT AGREEMENT

    

    This AMENDED AND RESTATED EMPLOYMENT
AGREEMENT (this “Agreement”) is made as of
December 21, 2004 between Active Health Management, Inc., a Delaware corporation
with an office at 102 Madison Avenue, New York, New York  10016 (the
“Company”), and Lonny
Reisman, M.D., an individual residing at 18 Sutton Terrace, Jericho, New
York  11753 (“Executive”).

    

    W I T N E S S E T H :

     

    WHEREAS, the Company (formerly known as
ARMS Corporation) and Executive are parties to an Employment Agreement dated as
of September 1, 1998 (the “Original Employment
Agreement”), and the Company and Executive wish to amend and restate the
terms of the Original Employment Agreement as hereinafter set
forth;

     

    WHEREAS,
the Company wishes to continue to retain the services of Executive on terms and
conditions mutually agreeable and beneficial to the Company and Executive;
and

     

    WHEREAS,
Executive is willing to continue to render his services to the Company pursuant
to the terms and conditions hereof;

     

    NOW,
THEREFORE, in consideration of the premises and of the mutual promises,
representations and covenants herein contained, the parties hereby agree as
follows:

     

    1.           EMPLOYMENT.  The
Company hereby employs Executive and Executive hereby accepts such employment,
subject to the terms and conditions herein set forth.  Executive shall
serve in the position of Chief Executive Officer of the Company.

     

    2.           TERM.  This
Agreement shall commence on the date hereof and shall continue in full force and
effect until December 31, 2008.  Thereafter, this Agreement shall
automatically be renewed for successive terms of one year each unless either
party shall give the other party written notice, at least 90 days prior to the
end of the then current term, of its or his intent not to renew this
Agreement.  Notwithstanding the foregoing, this Agreement may be
terminated prior to the expiration of the then current term under the
circumstances described in Section 7 below in accordance with the provisions
thereof.

     

    3.           COMPENSATION.

     

    (a)            Base Salary.  As
compensation for the employment services to be rendered by Executive hereunder,
including all services as an officer of the Company and any of its subsidiaries
or affiliates (“related
entities”), the Company agrees to pay, or cause to be paid, to Executive,
and Executive agrees to accept, an annual salary of $365,000.00, payable in
equal installments in accordance with Company practice. The foregoing salary
shall be reviewed annually by the Board of Directors of the Company (the “Board”) or its Compensation
Committee, which shall consider, in its sole discretion, whether to increase the
same in light of increased responsibilities, changes in the cost of living and
other factors which the Board may deem relevant.

     

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    (b)            Other
Compensation.  In addition to the base salary provided for in
Section 3(a) hereof, in respect of calendar year 2004 and each calendar year
thereafter during the term hereof, Executive shall also be eligible to receive
additional compensation in the form of a performance bonus (a “Bonus”) for such year
pursuant to a bonus plan established and administered by the Board (or its
Compensation Committee), in its sole discretion, for the benefit of the
Company's senior management.  The amount of the Bonus for each year,
if any, shall be a function of Executive's efforts and performance, as well as
the Company's growth, results of operations and financial condition, and such
other factors as the Board (or its Compensation Committee) may, in its sole
discretion, deem relevant.  The Company shall have no obligation to
establish such a bonus plan, or to pay to Executive any Bonus thereunder, if the
Board (or its Compensation Committee), in its sole discretion, determines not to
establish such a plan and/or not to make a payment under such a plan to
Executive.

     

    4.            EXPENSES.  The
Company shall pay or reimburse Executive, upon presentment of suitable vouchers,
for all reasonable business and travel expenses which may be incurred or paid by
Executive in connection with his employment hereunder.  Executive
shall comply with such restrictions and shall keep such records as the Company
may deem necessary to meet the requirements of the Internal Revenue Code of
1986, as amended from time to time, and regulations promulgated
thereunder.

     

    5.            OTHER
BENEFITS.

     

    (a)           Executive
shall be entitled to vacation at the rate of four (4) weeks per year, with
vacation time to accrue based upon the accrual schedule set forth in the
Company's Employee Handbook.  All vacation days shall be taken at such
times as do not unreasonably interfere with the business of the
Company.  Executive may be entitled to carry unused vacation time
forward from year to year, and to be compensated for any unused vacation time,
in accordance with the policy of the Company with respect to such matters in
effect from time to time.

     

    (b)           Executive
shall be entitled to participate in all pension and welfare plans, programs and
benefits offered by the Company generally with respect to senior officers of the
Company, all as determined from time to time by the Company's Board of
Directors, in accordance with the terms and conditions of such plans and
programs.

     

    (c)           The
Company shall provide medical malpractice insurance coverage covering acts and
omissions of Executive as a physician, which coverage shall include acts and
omissions of Executive in the private practice of medicine as described in
Section 6(b) below.

     

    6.            DUTIES.

     

    (a)            Executive
shall be subject to the direction of the Board of Directors of the
Company.  Executive shall perform such duties and functions
appropriate to the position of Chief Executive Officer as the Board of Directors
of the Company shall from time to time determine. At the request of the Board of
Directors of the Company, Executive shall serve as a senior officer and/or
director of any related entity of the Company.

    
      
         

      

      
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    (b)            During
the term of this Agreement, Executive shall devote all of his working time and
attention, reasonable vacation time and absences for sickness excepted, to the
business of the Company, as necessary to fulfill his
duties.  Executive shall perform the duties assigned to him with
fidelity and to the best of his ability.  Executive shall deal at all
times in good faith with the Company and shall conduct himself at all times in
the best interest of the Company.  Notwithstanding anything herein to
the contrary, Executive may engage in other activities so long as such
activities do not unreasonably interfere with Executive's performance of his
duties hereunder and do not violate Section 9 hereof.  Without
limiting the generality of the foregoing, the occasional private practice of
medicine, in accordance with Executive's medical licenses and consistent with
his board certifications, shall be deemed to be described in this Section 6(b)
and shall be deemed not to unreasonably interfere with Executive's performance
of his duties hereunder and not to violate the provisions of Section 9 hereof;
provided, that such private practice of medicine shall not require more than an
average of five (5) hours per week of Executive's time during normal business
hours.

     

    (c)            The
principal location at which Executive shall perform his duties hereunder shall
be at the offices of the Company in New York, New York, or as reasonably changed
in the future, although Executive understands and agrees that he will be
required to travel from time to time for business reasons.

     

    7.            TERMINATION
OF EMPLOYMENT; EFFECT OF TERMINATION.

     

    (a)            This
Agreement and Executive's employment hereunder shall be terminated:

     

    (1)            (i)
at any time for any reason which would not constitute “Justifiable Cause” (as hereinafter
defined), upon 90 days’ prior written notice of termination from the Company to
Executive or (ii) at any time under circumstances constituting “Good Reason” (as such term is
hereinafter defined), upon 10 days’ prior written notice of termination from
Executive to the Company; or

     

    (2)            (i)
following the determination by the Board that there is Justifiable Cause for
such termination, upon 10 days’ prior written notice of termination from the
Company to Executive or (ii) at any time for any reason other than Good Reason,
upon 30 days’ prior written notice of termination from Executive to the Company;
or

     

    (3)            immediately
upon the death of Executive; or

     

    (4)            in
the event of the “Disability” (as hereinafter
defined) of Executive, upon 30 days’ prior written notice from the Company to
Executive.

     

    As used
herein, the following capitalized terms shall have the following
meanings:

     

    “Justifiable Cause” shall mean
and be limited to: (1) Executive’s conviction (which, through lapse of time or
otherwise, is not subject to appeal) of or pleading guilty to any crime (i)
involving theft, embezzlement or other misappropriation of money or other
property of the Company, its related entities or any other business enterprise;
(ii) involving moral turpitude;

    
      
         

      

      
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    or (iii)
which constitutes a felony in the jurisdiction involved; (2) Executive’s
engagement in a fraudulent act to the material damage or prejudice of the
Company or its related entities or in conduct or activities materially damaging
to the property, business or reputation of the Company or its related entities
(including, without limitation, gross negligence in the performance of
Executive’s duties hereunder or any act which may expose the Company to
liability for violation of the civil rights of any other employee of the
Company), all as reasonably determined by the Board; (3) Executive’s
substantiated illegal use of controlled substances; (4) the entry of an order of
a court that remains in effect and is not discharged for a period of at least 60
days, which enjoins or otherwise limits or restricts the performance by
Executive under this Agreement, relating to any material contract, agreement or
commitment made by or applicable to Executive in favor of any former employer or
any other person; or (5) a breach by Executive of any of the material terms of
this Agreement, as reasonably determined by the Board.

     

    “Good Reason” shall mean and
be limited to: (1) breach by the Company of any of the material terms of this
Agreement, which breach shall remain uncured 30 days after the Company's receipt
of a written notice from Executive specifying the nature of the breach; (2)
relocation of the Company’s principal executive officers to a location more than
50 miles from New York, New York; (3) a material diminution of Executive’s
duties and responsibilities hereunder, which diminution shall remain in effect
30 days after the Company’s receipt of a written notice from Executive
specifying the diminution to which he objects; or (4) a material diminution of
Executive’s entire compensation or employee benefits hereunder.

     

    “Disability” shall have the
meaning assigned to such term in any long-term disability plan or program of the
Company in which Executive is entitled to participate; provided, however, that
in the absence of any such plan or program, “Disability” shall mean
Executive’s inability to substantially perform his duties hereunder by reason of
any medically determined physical or mental impairment which can be expected to
result in death or which has lasted or can be expected to last for any
substantially continuous period of not less than six (6) months.

     

    (b)            Upon
any early termination of this Agreement, except as provided below, Executive
shall not be entitled to receive further compensation hereunder for any period
of time after such date.  Notwithstanding the foregoing, if (i) this
Agreement is terminated in a “Severance Circumstance” (as
defined below) and (ii) Executive shall have executed a valid and comprehensive
release in the form prescribed by the Company of any and all claims Executive
may have against the Company and any of its related entities, except as set
forth in Section 7(c) hereof (the “Severance Release”), within ten days after
the Company provides the same for execution by Executive:

     

    (1)           Executive
shall be entitled to receive payments of Executive’s then annual salary, at the
rate then in effect pursuant to Section 3(a), for a period of one year after the
effective date of termination (the “Severance
Period”);

     

    (2)           The
Company shall continue to provide, at the Company’s expense, coverage under
plans or policies providing employee benefits as described in Section 5 hereof
(or comparable benefits) during the Severance Period;

    
      
        
        

      

      
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    (3)           Notwithstanding
anything to the contrary contained in the Company’s Series Fl Stock Option Plan
(the“F1 Plan”) or any
other stock option plan of the Company relating to options (“Fl Options”) to purchase
shares of the Company's Series Fl Preferred Stock, par value $.01 per share
(“Fl Preferred”), or in the Incentive
Stock Option Agreement made as of September 10, 2002 (the “2002 Fl Option Agreement”) or
any other stock option agreement relating to Fl Options, (A) Executive’s Fl
Options outstanding on the date of termination (including, without limitation,
his Fl Options to purchase 1,175,000 shares of F1 Preferred (the “2002 Fl Options”), pursuant
to the 2002 F1 Option Agreement and the F1 Plan) shall remain outstanding and
continue to vest, and shall otherwise be treated for purposes of the terms and
conditions thereof as if Executive remained in the employ of the Company,
through the second (2nd) anniversary of the date of such termination (the “Vesting Termination Date”),
and (B) the expiration date of the exercise period for all such Fl Options
(including, without limitation, the 2002 Fl Options) shall be the Vesting
Termination Date, and all such Fl Options which are vested shall be exercisable
on or prior to such date; and

     

    (4)         Notwithstanding
anything to the contrary contained in the Company’s Amended and Restated 1999
Stock Option Plan (the “Common
Plan”) or any other stock option plan of the Company relating to options
(“Common Options”) to purchase shares of
Common Stock of the Company (“Common Stock”), or in the Non-Qualified
Stock Option Agreement made as of December 21, 2004 (the “2004 Common Option
Agreement”) or any other stock
option agreement relating to Common Options, (A) Executive’s Common Options
outstanding on the date of termination (including, without limitation, his
Common Options to purchase 100,000 shares of Common Stock (the “2004 Common Options”) pursuant to the 2004
Common Option Agreement and the Common Plan) shall remain outstanding and
continue to vest, and shall otherwise be treated for purposes of the terms and
conditions thereof as if Executive remained in the employ of the Company through
the Vesting Termination Date, and (B) the expiration date of the exercise period
for all such Common Options (including, without limitation, the 2004 Common
Options) shall be the Vesting Termination Date, and all such Common Options
which are vested shall be exercisable on or prior to such date.”

     

    The
Company shall take all actions necessary or advisable to give effect to this
Section 7(b). Such severance payments in clause (x) above shall be made in equal
installments throughout the Severance Period at the same times at which salary
payments are made to the Company’s employees generally.

     

    As used
herein, the term “Severance
Circumstance” means the termination of this Agreement pursuant to Section
7(a)(1) hereof or the Company’s election not to renew this Agreement at the end
of its then current term pursuant to Section 2 hereof.

     

    (c)            Immediately
upon termination of this Agreement, at the election of the Company’s Chairman of
the Board, Executive shall cease all activities at or on behalf of the Company
and shall return to the Company all documents, records and files of the Company,
and the Company shall have no further obligations to Executive except for
payment of (w)

    
      
         

      

      
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    Executive’s
annual salary earned through the termination date; (x) reimbursable expenses
incurred by Executive prior to the termination date; (y) any Bonus payable to
Executive in respect of any prior bonus period which remains unpaid; and (z) if
applicable, severance payments and other termination benefits set forth in
subsection (b) above.  Notwithstanding the foregoing, the
indemnification provisions set forth in Section 8(a) hereof shall survive any
termination of this Agreement.

     

      
(d)            In
the event of the termination or expiration of this Agreement for any reason, the
Company reserves the right, to the extent permitted by law and in addition to
any other remedy the Company may have, to deduct from any monies otherwise
payable to Executive the full amount of any debt Executive may owe to the
Company or any of its related entities at the time of or subsequent to the
termination or expiration of this Agreement.  In the event that the
law of any state or other jurisdiction requires the consent of an employee for
such deductions, this Agreement shall serve as such consent.

     

    8.            REPRESENTATIONS
AND AGREEMENTS OF EXECUTIVE.

     

    (a)           Executive
represents and warrants to the Company that the execution, delivery and
performance by Executive of this Agreement will not result (with or without the
giving of notice or the lapse of time or both) in any conflict, violation,
breach or default on the part of Executive under any agreement or understanding,
whether written or oral, to which Executive is a party or by which he is
bound.  Executive shall indemnify and hold harmless the Company from
and against any liabilities, claims, damages and expenses for any losses
resulting from any such conflict, violation, breach or default.

     

    (b)           Executive
agrees that he shall comply with any and all employee handbooks, policy manuals
and similar documents of the Company.

     

    (c)           Executive
agrees to submit to a medical examination and to cooperate and supply such other
information and documents as may be required by any insurance company in
connection with the Company’s obtaining any type of insurance or fringe benefit
as the Company shall determine from time to time to obtain.

     

    9.            NON-COMPETITION;
NON-SOLICITATION; ETC.

     

      
(a)            In
consideration of the Company's award to Executive the 2004 Common Options on or
about the date of this Agreement, and for other good and valuable consideration,
the receipt and adequacy of which is hereby acknowledged, Executive agrees that
during the “Non-Compete
Period” (as defined below), Executive shall not, directly or indirectly,
as owner, lender, partner, joint venturer, stockholder, employee, agent,
principal, trustee, officer, director, or in any capacity whatsoever, engage in,
become financially interested in, be employed by, or render any consultation or
business advice or other services with respect to (i) any business which
provides or offers products or services, in any geographic area in the United
States of America, which are competitive with any products or services of the
Company or any of its related entities in the following lines of business: (x)
healthcare disease management, (y) the line of business consisting of the suite
of services currently offered under the rubric of the Company’s “CareEngine”
registered trademark or (z) any other line of business in which
the

    
      
         

      

      
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    Company
or any of its related entities is materially engaged during the period of
Employee’s employment hereunder or (ii) any business conducted under any
corporate or trade name utilized by the Company or any related entity without
the prior written consent of the Company; provided, however, that Executive may
own any securities of the Company or any of its related entities, and any
securities of any corporation which is engaged in such business and is publicly
owned and traded but in an amount not to exceed at any one time one percent (1%)
of any class of stock or securities of such publicly traded
corporation.

     

    As used
herein, the term “Non-Compete
Period” shall mean the period during the term of this Agreement and a
further period of two (2) years following the expiration or termination of this
Agreement for any reason pursuant to Section 7(a) hereof, whether or not
Executive timely executes the Severance Release (if applicable) as called for by
Section 7(b) hereof; provided, in the case of a termination pursuant to Section
7(a)(1) hereof, the Non-Compete Period shall be deemed to cease if the Company
fails to pay when due any periodic installment of the severance obligation
pursuant to Section 7(b) hereof and such payment default shall remain uncured 10
days following the Company’s receipt of a written default notice from
Executive.”

     

    (b)           In
addition, Executive agrees that during the term hereof and for a period of two
(2) years thereafter he shall not, directly or indirectly: (i) request or cause
any suppliers or customers with whom the Company or any of its related entities
has a business relationship to cancel, terminate or diminish any such business
relationship with the Company or any of its related entities; (ii) solicit,
interfere with or entice or hire from the Company or any of its related entities
any employee of the Company or any of its related entities (or former employee
who had terminated his or her employment with the Company or any of its related
entities during the three-month period prior to the expiration or termination of
this Agreement); or (iii) in any communications with any customer, investor,
vendor, business partner or client of the Company or any of its related
entities, criticize, ridicule or make any statement which disparages or is
derogatory of the Company or any of its related entities or any of their
respective officers, directors, agents or employees.

     

    (c)            If
any portion of the restrictions set forth in this Section 9 should, for any
reason whatsoever, be declared invalid by a court of competent jurisdiction, the
validity or enforceability of the remainder of such restrictions shall not
thereby be adversely affected.

     

    (d)            Executive
acknowledges that the historical business operations of the Company and its
related entities have been conducted throughout the United States, that the
sales and marketing prospects of such organizations are for continued expansion
throughout the United States and that, therefore, the territorial and time
limitations set forth in this Section 9 are reasonable and properly required for
the adequate protection of the business of the Company and its related
entities.  In the event any such territorial or time limitation is
deemed to be unreasonable by a court of competent jurisdiction, Executive agrees
to the reduction of the territorial or time limitation to the area or period
which such court shall deem reasonable.

     

    (e)            Notwithstanding
anything herein to the contrary, this Section 9 shall automatically terminate
with respect to the Company or any of its related entities (x) upon the
dissolution of such entity or (y) if a court of competent jurisdiction shall
enter an order, judgment or decree approving a petition seeking liquidation of
such entity under Chapter 7 of the United

    
      
         

      

      
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    States
Bankruptcy Code, or under comparable provisions of any state insolvency laws,
and such order, judgment, decree is not dismissed or vacated within a period of
sixty (60) consecutive days.

     

    10.           INTELLECTUAL
PROPERTY

     

    (a)            Executive
agrees that any innovations, improvements or business concepts that he may
develop or suggest during the term of this Agreement relating to the work or
projects carried on by Executive on behalf of the Company or any of its related
entities and any other results or proceeds of Executive’s employment by the
Company (collectively, the “Works and Intellectual Property”)
shall constitute works-made-for-hire and shall be the exclusive property
of the Company.  Executive further agrees to make full disclosure
thereof to an authorized representative of the Company, and to no other person
without the consent of the Chairman of the Board of the Company and, to the
extent any of the Works and Intellectual Property do not legally constitute a
work-made-for-hire and/or there are any other rights with respect to the Works
and Intellectual Property that do not accrue to the Company pursuant to the
preceding sentence, Executive hereby irrevocably assigns and agrees to assign
without further compensation all such Works and Intellectual Property and all
rights thereto, domestic and foreign, to the Company.  Executive
hereby agrees to execute all documents whatsoever that may be necessary to
transfer to and vest in the Company all right, title and interest in and to all
of the Works and Intellectual Property.

     

    (b)            All
documents, data, recordings or other property, whether tangible or intangible,
including all information stored in electronic form, obtained or prepared by or
for Executive and utilized by Executive in the course of Executive’s employment
hereunder shall remain the exclusive property of the Company.

     

    11.         NON-DISCLOSURE
OF CONFIDENTIAL INFORMATION.

     

    (a)            Executive shall not, during the term of
this Agreement, or at any time thereafter, directly or indirectly,
disclose or permit to be known (other than (i) as required in the regular course of his duties, including
without limitation disclosures to the Company’s advisors and consultants, or (ii) as required by
law, in which case Executive shall give the Company prior written notice of such
required disclosure) to any person, firm or corporation any Confidential
Information acquired by him during the course of, or as an incident to, his
employment or the rendering of his advisory or consulting services hereunder,
relating to the Company or any of its related entities, the directors of the
Company or its related entities, any client of the Company or any of its related
entities, or any corporation, partnership or other entity owned or controlled,
directly or indirectly, by any of the foregoing, or in which any of the
foregoing has a beneficial interest, including, but not limited to, the business
affairs of each of the foregoing. Notwithstanding the foregoing, Executive may
disclose Confidential Information to his personal legal and financial advisors in the
course of obtaining their advice and counsel.  Any breach by any of
such advisors of the terms of this Section 11 shall be deemed a breach by
Executive.

     

    (b)            The
term “Confidential Information”
shall mean all information and know-how (whether or not in writing) of a
confidential, secret, private or proprietary nature concerning the Company, any
of its related entities and their respective businesses and
affairs

    
      
         

      

      
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    and shall
include, but shall not be limited to, proprietary technology, trade secrets,
patented processes, research and development data, know-how, market studies and
forecasts, competitive analyses, pricing policies, employee lists, personnel
policies, the substance of agreements with customers, suppliers and others,
marketing or dealership arrangements, servicing and training programs and
arrangements, customer lists and any other documents embodying such confidential
information.  Notwithstanding anything to the contrary contained
herein, Confidential Information shall not include (i) any information which is
or becomes publicly available other than pursuant to a breach of Sections 11(a)
or 11(c) by Executive or (ii) information which is independently developed by
Executive after the expiration or termination of this Agreement without making
use of the Confidential Information.

     

    (c)            All
Confidential Information and documents and materials containing Confidential
Information of the Company or any of its related entities shall be the exclusive
property of the Company, and Executive shall use commercially reasonable best
efforts to prevent any publication or disclosure thereof.  Upon
expiration or termination of this Agreement, all documents, records, reports,
writings and other similar documents containing Confidential Information,
including copies thereof, then in Executive’s possession or control shall be
returned to and left with the Company.

     

    12.           SPECIFIC
PERFORMANCE; RELEASE OF COMPANY OBLIGATIONS.

     

    (a)            Executive
agrees that if he breaches, or threatens to commit a breach of, any of the
provisions of Sections 9, 10 or 11 (the “Restrictive Covenants”), the Company shall have,
in addition to, and not in lieu of, any other rights and remedies available to
the Company under law and in equity, the right to injunctive relief and/or to
have the Restrictive Covenants specifically enforced by a court of competent
jurisdiction, it being agreed that any breach or threatened breach of the
Restrictive Covenants would cause irreparable injury to the Company and its
related entities and that money damages would not provide an adequate remedy to
the Company.

     

    (b)            If
Executive breaches his obligations pursuant to the Restrictive Covenants, then
without limiting any other remedy that the Company may have at law, the Company
shall be released from any remaining obligation to Executive that it would
otherwise have thereafter.

     

    13.            AMENDMENT
OR ALTERATION.  No amendment or alteration of the terms of this
Agreement shall be valid unless made in writing and signed by both of the
parties hereto.

     

    14.            GOVERNING
LAW; VENUE.  This Agreement shall be governed by and construed in
accordance with the law of the State of New York applicable to agreements made
and to be performed therein, without giving effect to its principles of
conflicts of law.  The parties hereto irrevocably and exclusively
submit to the jurisdiction of the courts of the state of New York and the
federal courts of the United States located in the Southern District of New
York, and any appellate court from any thereof, with respect to any suit, action
or proceeding pertaining to this Agreement.

    
      
         

      

      
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    15.           SEVERABILITY.  The
holding of any provision of this Agreement to be invalid or
unenforceable by a court of competent jurisdiction shall not affect any other
provision of this Agreement, which shall remain in full force and
effect.

     

    16.           NOTICES.  Any
notices required or permitted to be given hereunder shall be sufficient if in
writing, and if delivered by hand or courier, or sent by certified mail, return
receipt requested, to the addresses set forth above or such other address as
either party may from time to time designate in writing to the other, and shall
be deemed given as of the date of the delivery or at the expiration of three
days in the event of a mailing.

     

    17.            WAIVER
OR BREACH.  It is agreed that a waiver by either party of a breach of
any provision of this Agreement shall not operate, or be construed, as a waiver
of any other provision or of any subsequent breach by that same
party.

     

    18.            ENTIRE
AGREEMENT; SUPERSESSION; AMENDMENT; BINDING EFFECT.  This Agreement
contains the entire agreement between the Company and its related entities, on
the one hand, and Executive, on the other hand, with respect to the subject
matter hereof and supersedes all prior agreements, both written and oral,
between the Company and its related entities, on the one hand, and Executive, on
the other hand, with respect to the subject matter hereof including, without
limitation, the Original Employment Agreement (except for Sections 13 and 14
thereof and the documents referenced therein, which shall remain in full force
and effect).  This Agreement may be modified only by a written
instrument signed by each of the parties hereto.  This Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective legal representatives, heirs, distributors, successors and assigns,
provided, however, that Executive shall not be entitled to assign or delegate
any of his rights or obligations hereunder without the prior written consent of
the Company.

     

    19.            WITHHOLDINGS.  All
amounts paid to Executive under this Agreement shall be subject to customary
withholdings for income taxes, F.I.C.A. and similar charges.

     

    20.            SURVIVAL.  Except
as otherwise expressly provided herein, the termination or the expiration of
this Agreement shall not affect the enforceability of Sections 7(b), 7(c), 7(d),
8(a) and (b), and 9 through 23 hereof.

     

    21.            FURTHER
ASSURANCES.  The parties agree to execute and deliver all such further
documents, agreements and instruments and take such other and further action as
may be necessary or appropriate to carry out the purposes and intent of this
Agreement.

     

    22.            CONSTRUCTION
OF AGREEMENT.  No provision of this Agreement or any related document
shall be construed against or interpreted to the disadvantage of any party
hereto by any court or other governmental or judicial authority by reason of
such party having or being deemed to have structured or drafted such
provision.

     

    23.            HEADINGS.  The
Section headings appearing in this Agreement are for the purposes of easy
reference and shall not be considered a part of this Agreement or in any way
modify, demand or affect its provisions.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

     

    

     

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

     

    

     

    

     

    

    
      	 
      	
              ACTIVE
      HEALTH MANAGEMENT, INC.

            

    

     

    

     

    

     

    

    
      	 
      	
              By:

            	
              /s/ Albert S.
      Waxman

            
	 
      	 
      	
              Albert
      S. Waxman, Ph. D.

            
	 
      	 
      	
              Chairman
      of the Board

            

    

     

    

     

    

     

    

    
      	 
      	
              /s/ Lonny
      Reisman

            
	 
      	
              Lonny
      Reisman, M.D.

            

    

     

     

     

    11ex10_2.htm

    
      
        

      
Exhibit
10.2

       

      EMPLOYMENT AGREEMENT
AMENDMENT

       

      THIS
EMPLOYMENT AGREEMENT AMENDMENT, dated as of May 12, 2005 (this “Amendment”),
among AETNA INC., a
Pennsylvania corporation (“Parent”),
ACTIVE HEALTH MANAGEMENT,
INC., a Delaware corporation (the “Company”)
and LONNY REISMAN, M.D.,
an individual residing at 18 Sutton Terrace, Jericho, New York 11753 (“Executive”).  Capitalized
terms not defined herein have (and shall have for purposes of this Amendment)
the meanings ascribed to such terms in the Agreement and Plan of Merger dated of
even date herewith (as the same may be amended from time to time, the “Merger
Agreement”), by and among Parent, ARIZONA ACQUISITION
CORPORATION, a Delaware corporation and a wholly owned subsidiary of
Parent (“Purchaser”),
the Company and JOSEPH A.
RILEY, solely in his capacity as a Stakeholder
Representative.

       

      WHEREAS,
Parent, Purchaser and the Company propose to enter into the Merger Agreement
pursuant to which Purchaser will be merged with and into the Company (the “Merger”) and the
Company will continue as the surviving corporation;

       

      WHEREAS,
Executive is a founder and senior executive of the Company;

       

      WHEREAS,
Executive owns a substantial number of shares of Company Common Shares and
Company Stock Options and, by virtue of such ownership, will be paid significant
cash consideration pursuant to the terms of the Merger Agreement upon completion
of the Merger;

       

      WHEREAS,
prior to the date of this Agreement, Executive and the Company entered into that
certain Amended and Restated Employment Agreement dated as of December 21, 2004
(the “Employment
Agreement”) and that certain Employee Confidentiality and Assignment of
Inventions Agreement dated December 6, 2002 (the “Inventions
Agreement,” and together with the Employment Agreement, the “Existing
Agreements”); and

       

      WHEREAS,
in connection with the transactions contemplated by the Merger Agreement, Parent
and Executive have agreed to certain amendments to the Employment Agreement, in
each case as more fully described in this Amendment.

       

      NOW,
THEREFORE, in consideration of the foregoing and the representations,
warranties, covenants and agreements set forth herein, the Company and Executive
agree as follows:

       

      ARTICLE
I

       

      EFFECTIVENESS
OF AMENDMENT

       

      1.1           This
Amendment shall become effective on the date hereof but shall be null and void
ab initio and of no
further force and effect if the Merger Agreement is terminated pursuant to
Section 8.01 thereof prior to the Effective Time.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      ARTICLE
II

       

      EMPLOYMENT
AGREEMENT AMENDMENT

       

      2.1           Ratification of Employment
Agreement.  Executive confirms that Executive has executed and
delivered to the Company the Employment Agreement and the Inventions Agreement
in the forms of Exhibits
A and B
hereto, respectively, and, except as set forth herein, that there have been no
oral or written modifications or amendments to, or waivers of, the provisions of
the Existing Agreements.

       

      2.2           Amendments to Employment
Agreement.  Executive, the Company and Parent hereby agree to
amend the Employment Agreement, effective as of the date hereof, as
follows:

       

      (A)           From
and after the Effective Time, the term “Company”
as used in the Employment Agreement shall include the Surviving
Corporation.

      

      (B)           Section
3 of the Employment Agreement is hereby amended in its entirety to read as
follows:

      

      (a)  Base salary.  As
compensation for the employment services to be rendered by Executive hereunder,
including all services as an officer of the Company and any of its subsidiaries
or affiliates (“related
entities”), the Company agrees to pay, or cause to be paid, to Executive,
and Executive agrees to accept, an annual salary of $451,052.00, payable in
equal installments in accordance with Company practice (“Base Salary”).  The
foregoing Base Salary shall be reviewed annually by the Board of Directors of
the Company (the “Board”) or its Compensation
Committee, which shall consider, in its sole discretion, whether to increase the
same in light of increased responsibilities, changes in the cost of living and
other factors which the Board may deem relevant.

      

      (b)  Annual Performance
Bonus.  In addition to the Base Salary provided for in Section
3(a) hereof, in respect of calendar year 2006 and each calendar year thereafter
during the term hereof, Executive shall also be eligible to receive additional
compensation in the form of an annual performance bonus (an “Annual Performance
Bonus”).  The Annual Performance Bonus opportunity percentage
for target level performance for Executive will be sixty percent (60%) of Base
Salary, based on achieving certain financial goals to be set by the Parent in
reasonable consultation with Executive.  The Annual Performance Bonus
target for maximum performance (based on the goals established pursuant to the
preceding sentence) shall be one hundred-twenty percent (120%) of Base
Salary.  Such Annual Performance Bonus payment(s), if any, shall be
paid on or before February 28 of the following calendar year.

      

      (c) 2005 Performance
Bonus.  In addition to the base salary and bonus opportunities
provided for in Sections 3(a) and 3(b) hereof, in respect of calendar year 2005,
Executive shall also receive additional compensation (the “2005 Bonus”) in the form of a
one-time bonus equal to the greater of (i) $225,526.00

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      (the
“Guaranteed Amount”) and
(ii) the bonus determined for 2005 based on the Company’s actual performance for
2005 under the Company’s 2005 Bonus Plan, payable on or before February 28,
2006; provided,
however, that
the Guaranteed Amount shall not be payable prior to (and Executive shall, except
as set forth in Section 7(b)(1), be required to remain employed until) the four
month anniversary of the Effective Time.

      

      (d)  Stock
Options.  Effective as of the Effective Time, Executive shall
be granted stock options (the “Initial Options”) to purchase
36,000 shares of Parent’s common stock with an exercise price equal to the
closing price of Parent’s common stock on the consolidated tape of the New York
Stock Exchange listed shares on the day on which the Effective Time
occurs.  Fifty percent of the Initial Options shall vest and become
exercisable on December 31, 2007, and the remaining 50% of the Initial Options
shall vest and become exercisable on December 31, 2008.  The Initial
Options shall be granted pursuant to, and shall be governed by, the Parent stock
option plan and related form of stock option agreement applicable to similarly
situated executives of Parent.

       

      (e)  Special Performance-Based
Incentive.  In addition to the base salary, bonus
opportunities, and stock options provided for in Sections 3(a), 3(b), 3(c), and
3(d) hereof, in respect of calendar years 2006 and 2007, Executive shall also be
eligible to receive a Special Performance-Based Bonus (“Special Performance-Based
Incentive”) related to EBITDA (“Earnings Before Interest, Taxes,
Depreciation and Amortization”) targets, as set forth in Exhibit C
hereto.

      

      (C)           Section
5(b) of the Employment Agreement is hereby amended, effective as of January 1,
2006 or such earlier date as the Company’s employee benefit plans are integrated
with Parent’s, in its entirety to read as follows:

       

      (b)  Executive
shall be entitled to participate in all retirement (other than defined benefit
plans) and welfare plans, programs and benefits (or substantially similar
programs) offered by Parent generally with respect to similarly situated
executives of Parent, all as determined from time to time by Parent’s Board of
Directors, in accordance with the terms and conditions of such plans and
programs.

       

      (D)           Section
5(c) of the Employment Agreement is hereby deleted.

       

      (E)           Section
6(a) of the Employment Agreement is hereby amended to add the following at the
end thereof:

       

      Executive
shall report to Parent executive Ronald A. Williams (or his successor), or Mark
T. Bertolini (or his successor).  Executive shall have management
responsibility to hire or terminate the employment of any employees of the
Company in a manner consistent with the applicable policies and procedures of
Parent.

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      

       

      (F)           Section
6(b) of the Employment Agreement is hereby amended in its entirety to read as
follows:

      

      During
the term of this Agreement, Executive shall devote all of his working time and
attention, reasonable vacation time and absences for sickness excepted, to the
business of the Company, as necessary to fulfill his
duties.  Executive shall perform the duties assigned to him with
fidelity and to the best of his ability.  Executive shall deal at all
times in good faith with the Company and shall conduct himself at all times in
the best interest of the Company.  During the term of this Agreement,
Executive shall not own, manage, control, operate, participate in, invest in,
render services for, or act as an officer, director, partner, member, employee,
consultant or agent of any venture capital firm or partnership or other entity
that invests in healthcare-related businesses or ventures. Notwithstanding
anything herein to the contrary, Executive may engage in other activities so
long as such activities do not unreasonably interfere with Executive’s
performance of his duties hereunder and do not violate Section 9
hereof.

      

      (G)           The
definition of “Good Reason” set forth in Section 7(a) of the Employment
Agreement is hereby amended in its entirety to read as follows:

      

      “Good Reason” shall mean and be
limited to: (1) breach by the Company of any of the material terms of this
Agreement, which breach shall remain uncured 30 days after the Company’s receipt
of a written notice from Executive specifying the nature of the breach; (2)
relocation of the Company’s principal executive officers to a location other
than the New York City metropolitan area; (3) a material diminution of
Executive’s duties and responsibilities hereunder, which diminution shall remain
in effect 30 days after the Company’s receipt of a written notice from Executive
specifying the diminution to which he objects; (4) a material diminution of
Executive’s entire compensation (defined, for purposes of this Section, to mean
Executive’s base salary and bonus opportunities, as set forth in Sections 3(a),
3(b), 3(c) and 3(e)) or employee benefits hereunder (except for any diminution
in such benefits that apply to similarly situated executives of Parent); (5) a
failure by Parent to continue to offer until the second anniversary of the
Effective Time the Company’s CareEngine services to Parent’s members in a manner
substantially consistent with past practice; or (6) a failure of Parent or the
Company to conduct the business of the Company substantially on a stand-alone
basis until the second anniversary of the Effective Time.

      

      (H)           Section
7(b) of the Employment Agreement is hereby amended in its entirety to read as
follows:

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      

       

      Upon an
early termination of this Agreement, except as provided below, Executive shall
not be entitled to receive further compensation hereunder for any period of time
after such date.  Notwithstanding the foregoing, if (i) this Agreement
is terminated in a “Severance
Circumstance” (as defined below) and (ii) Executive shall have executed a
valid and comprehensive release in the form prescribed by the Company of any and
all claims Executive may have against the Company and any of its related
entities, except as set forth in Section 7(c) hereof (the “Severance Release”), within
ten days after the Company provides the same for execution by
Executive:

       

      (1)           Executive
shall be entitled to receive (x) payments of Executive’s then annual Base
Salary, at the rate then in effect pursuant to Section 3(a), for a period of (i)
one year after the effective date of termination of employment, if such
termination occurs more than twelve (12) months after the Effective Time, or
(ii) two years after the effective date of termination of employment, if such
termination occurs during the 12-month period following the Effective Time (in
either case, the “Severance
Period”) and (y) the 2005 Bonus and (z), if such Severance Circumstance
is other than pursuant to Section 7(a)(1)(ii) hereof, (I) a target bonus
determined under Section 3(b) for each year (or portion thereof) during the
Severance Period and (II) the Special Performance-Based Incentive for calendar
years 2006 and 2007 under Section 3(e) to the extent not yet paid, based on the
applicable performance of the Company and pro rated based on the number of days
that have elapsed from January 1, 2006 through the date of termination of this
Agreement.

      

       

      (2)           The
Company shall continue to provide, and pay the employer portion of the
applicable premiums for, coverage under plans or policies providing medical
benefits, as described in Section 5 hereof (or comparable benefits), during the
Severance Period.

       

       

      (3)           Upon
any early termination of this Agreement, except during any Severance Period, the
Company shall during the Restricted Period (as defined below), continue to
provide, at COBRA rates, medical coverage under the Company’s or Parent’s group
health plan.

       

      

      The
Company shall take all actions necessary or advisable to give effect to this
Section 7(b).  The Base Salary severance payments in clause 1(x) above
shall be made in equal installments throughout the Severance Period at the same
times at which salary payments are made to the Company’s employees generally,
and any bonus payments pursuant to clause 1(y) or (z) above shall be made at the
time bonus payments are generally made under the applicable bonus
plan.

       

      As used
herein, the term “Severance
Circumstance” means the termination of this Agreement pursuant to Section
7(a)(1) hereof or the Company’s election not to renew this Agreement at the end
of its then

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      current
term pursuant to Section 2 hereof, except if Executive has attained the age of
at least sixty five (65) at the time of the Company’s election not to renew this
Agreement.

      

      (I)  Clause
(y) of Section 7(c) of the Employment Agreement is hereby amended to delete the
word “Bonus” and to substitute the word “bonus” therefor.

      

      (J)  Section
8 of the Employment Agreement is hereby amended to add the following new
subsections (d) and (e) to the end thereof:

       

      (d)  At
the Closing under the Merger Agreement, Executive agrees to purchase shares of
common stock in Parent having a then-current market value (based on the closing
price of Parent's common stock on the New York Stock Exchange on the first
trading day preceding the Closing) equal to $2,000,000.00 (the "Commitment
Shares").  Executive agrees to hold and maintain (in a
brokerage account selected by Executive) his record and beneficial ownership of
the Commitment Shares until the earlier of (i) the twenty four (24) month
anniversary of the Effective Time and (ii) the termination of this Agreement in
a Severance Circumstance.

       

      (e)  At
the Closing under the Merger Agreement, Executive shall pay in full all
principal, interest and other amounts owing to the Company under that certain
promissory note dated December 21, 2004.

       

      (K)           Section
9 of the Employment Agreement is hereby amended in its entirety to read as
follows:

       

      9.  NON-COMPETITION
AND NON-SOLICITATION

       

      1.           Acknowledgments.

       

      (a)           Executive
acknowledges that the Company and its Affiliates (as defined in the Merger
Agreement) have expended and shall continue to expend substantial amounts of
time, money and effort to develop business strategies, employee and customer
relationships, relationships and goodwill and build an effective
organization.  Executive acknowledges that during Executive’s prior
employment and association with the Company, Executive has become familiar with
the Company’s and its Affiliates’ Confidential Information (as defined below),
including trade secrets, and that following the consummation of the Merger,
Executive will become familiar with further Confidential Information of the
Company, Parent and their Affiliates including trade secrets, and that
Executive’s services are of special, unique and extraordinary value to the
Company and Parent.  Executive acknowledges that the Company, Parent
and their Affiliates have a legitimate business interest and right in protecting
such Confidential Information, goodwill, employee and customer relationships,
and that the Company, Parent and their Affiliates would be damaged by the
disclosure of such Confidential Information and the loss or deterioration of
their relationships with customers, employees, consultants, contractors,
subcontractors or agents.  Executive further acknowledges that the
Company, Parent

       

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

      and their
Affiliates and their respective successors are entitled to protect and preserve
the going concern value of the Company and its Affiliates to the fullest extent
permitted by law and that Parent and Purchaser would not have entered into the
Merger Agreement without Executive’s agreement to enter into this
Agreement.

       

      (b)           Executive
acknowledges (i) that the business of the Company and its Affiliates is and will
continue to be national in scope and (ii) notwithstanding the state of
incorporation or principal office of the Company and its Affiliates, or the
location of any of its or their executives or employees (including, without
limitation, Executive), it is expected that the Company and its Affiliates will
have business activities and have valuable business relationships within their
respective industries throughout the United States.  In addition,
Executive agrees and acknowledges that the potential harm to the Company, Parent
and their Affiliates of the non-enforcement of this Section 9 and Section 11
outweighs any potential harm to Executive of its enforcement by injunction or
otherwise.  Executive acknowledges that he has carefully read this
Section 9 and Section 11 and has given special consideration to the restraints
imposed upon Executive by this Agreement and is in full accord as to their
necessity for the reasonable and proper protection of Confidential Information
and other legitimate business interests of the Company, Parent and their
Affiliates now existing or to be developed in the future.  Executive
expressly acknowledges and agrees that each and every restraint imposed by this
Agreement is reasonable with respect to subject matter, time period and
geographical area.

       

      (c)           In
light of the foregoing acknowledgments and the substantial cash consideration to
be paid to Executive under the Merger Agreement, Executive agrees that the
covenants contained in this Section 9 and Section 11 are reasonable and properly
required for the adequate protection of the businesses and goodwill of the
Company.

      

       

      2.           Non-Competition and
Non-Solicitation.

       

      (a)           Executive
agrees that Executive shall not, while Executive is an employee of the Company
or any of its Affiliates, and for a period of the longer of (x) three (3) years
following the Effective Time and (y) two (2) years following the date of
termination of Executive’s employment with the Company and its Affiliates (the
longer of such periods, the “Restricted Period”), directly
or indirectly (other than in Executive’s capacity as an officer, director or
employee of the Company or an Affiliate of the Company):

       

      (i)           own,
manage, control, operate, participate in, consult with, advise, invest in,
finance, render services for, act as an officer, director, partner, member,
employee, consultant or agent of, or in any manner engage in any activities or
businesses in any city, county or state of the United States or any other
geographic area in which the Company is or has engaged in business (or has
actively considered, to Executive’s knowledge, engaging in business) at any time
during the period of Executive’s employment with the Company and/or its
Affiliates (the “Restricted
Area”), that are, directly or indirectly, in competition with (x) the
Company and/or (y) any business conducted by any Affiliates of the Company in
which Executive had any material involvement in the management or development of
such business (“Material
Involvement”) during the period of his employment with the Company or any
of its Affiliates (collectively, “Competitive Activities”),
including, without limitation (A) designing,

       

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

      researching,
developing, producing, creating, marketing, licensing, providing or selling
goods or services similar to or competitive with the type marketed, licensed,
provided or sold by, or, to Executive’s knowledge, under active design or
development by, the Company (or any Affiliate of the Company if Executive had
any Material Involvement therewith) at any time during the period of Executive’s
employment with the Company and/or its Affiliates; (B) providing healthcare
disease management services, services similar to or competitive with the suite
of services currently offered under the rubric of the Company’s “CareEngine”
registered trademark, medical cost management services, or other services that
are similar to or competitive with those services provided by the Company (or
any Affiliate of the Company if Executive had any Material Involvement
therewith) at any time during the period of Executive’s employment with the
Company and/or its Affiliates, (C) soliciting or attempting to solicit any
customer, supplier, licensee or other business relation (or, to Executive’s
knowledge, any prospective customers, suppliers, licensees or business relation)
of the Company (or any Affiliate of the Company if Executive had any Material
Involvement therewith) to purchase any goods or services of the type sold by the
Company (or any Affiliate of the Company if Executive had any Material
Involvement therewith) from anyone other than the Company or such Affiliate, or
to cease doing business with the Company or any such Affiliate, or otherwise to
interfere in any way with the relationship between such customer, supplier,
licensee or business relation and the Company or such Affiliate; and
(D) assisting any Person in any way to do, or attempt to do, anything
prohibited by (A) through (C) above;

       

      (ii)           (A) soliciting,
recruiting, hiring, engaging or attempting to hire or engage, whether on
Executive’s own behalf or the behalf of any other Person, any employees,
contractors or consultants of the Company or its Affiliates or Persons who have
worked or provided services for the Company or any of its Affiliates; provided, however, that the
restrictions set forth in this Section 2(a)(ii) shall not apply to Persons
whose employment or relationship with the Company (or an Affiliate of the
Company) was terminated more than twelve (12) months prior to such solicitation,
recruitment, hiring, engagement or attempted hiring or engagement;
(B) soliciting or encouraging any employee, contractor or consultant of the
Company or its Affiliates to leave the employment of or cease providing services
for the Company or its Affiliates; and (C) intentionally interfering with
the relationship of the Company or its Affiliates with any Person who or which
is employed by or otherwise engaged to perform services for the Company or its
Affiliates; or

       

      (iii)           establish
or assist any other Person in establishing in the Restricted Area any new
business which engages in Competitive Activities.

       

      (b)           Notwithstanding
anything to the contrary contained in this Agreement, the foregoing covenants
will not be deemed breached as a result of Executive’s passive ownership of less
than an aggregate of one percent (1%) of any class of publicly-traded securities
of a Person engaged, directly or indirectly, in Competitive
Activities.

       

      (c)           If
any portion of the restrictions set forth in this Section 9 or Section 11
should, for any reason whatsoever, be declared invalid by a court of competent
jurisdiction, the validity or enforceability of the remainder of such
restrictions shall not be adversely affected.  If a court declines to
enforce this Section 9 or Section 11, in whole or in part, the parties agree to
modify this Agreement in a manner consistent with the parties’ original intent
to provide the

       

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

       

      Company
with the maximum protection of the Company’s business interests as allowed by
law and to be bound by this Agreement as modified.

       

                 (L)           Section
11 of the Employment Agreement is hereby amended in its entirety to read as
follows:

       

      11.  NONDISCLOSURE OF
CONFIDENTIAL INFORMATION.

       

      (a)           Executive
acknowledges that all Confidential Information of the Company and its Affiliates
(including Parent after the Effective Time) obtained by Executive while employed
by the Company or its Affiliates (both prior to and following the date hereof)
are the property of the Company and/or such Affiliates, as
applicable.  Therefore, for so long as Executive serves as an officer,
director or employee of the Company or any of its Affiliates and at all times
thereafter, Executive agrees that Executive shall not copy and distribute,
furnish or otherwise disclose to any unauthorized Person or utilize, any
Confidential Information without the prior written consent of (x) the President
of Parent or his or her duly authorized designee (in the case of Confidential
Information of Parent or its Affiliates (other than the Company and its
Subsidiaries)) and (y) the Company Board (in the case of Confidential
Information of the Company and its Subsidiaries), other than in a good faith
effort to promote the interests of the Company and its Affiliates, unless and to
the extent that any Confidential Information becomes generally known to and
available for use by the public other than as a result of Executive’s acts or
omissions or as required by law or as ordered by a court; provided, however, that in any
such event, (A) Executive shall promptly notify in writing the Company or Parent
(as the case may be), and consult with and assist the Company or Parent (as the
case may be), in seeking a protective order or request for other appropriate
remedy, (B) in the event that such protective order or remedy is not obtained,
or if the Company or Parent (as the case may be), waive compliance with the
terms hereof, Executive shall disclose only that portion of the Confidential
Information which is required to be disclosed and shall exercise commercially
reasonable efforts to assure that confidential treatment shall be accorded to
such Confidential Information by the receiving Person and (C) the Company or
Parent (as the case may be), shall be given an opportunity to review the
Confidential Information prior to disclosure thereof.

       

      (b)           For
purposes of this Agreement, “Confidential Information”
means all secret, confidential or proprietary information, knowledge or data
(whether or not in written form) of or relating to the Company or any of its
Affiliates (including Parent after the Effective Time), or their customers,
suppliers or contractors or any other third parties in respect of which the
Company or its Affiliates has or has had or may have a business relationship or
owes or has owed a duty of confidentiality, or their respective businesses or
products (current, former and prospective), and that is not known to the public
generally other than as a result of the Executive’s breach of this Agreement,
including but not limited to:  technical information or reports; trade
secrets; unwritten knowledge and “know-how”; operating instructions; training
manuals; customer lists; customer buying records and habits; product sales
records and documents, and product development, marketing and sales strategies;
market studies, surveys and forecasts; marketing plans; profitability analyses;
product cost; long-range plans; information relating to pricing, competitive
strategies and new product development; information relating to any forms of
compensation or other personnel-related information; contracts; and supplier
lists.  Without limiting the foregoing, the existence of, and any
information concerning,

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      any
dispute between Executive and the Company or its Affiliates shall constitute
Confidential Information, except that Executive may disclose information
concerning such dispute to the court or arbitrator that is considering such
dispute or to Executive’s legal counsel (provided that such counsel agrees not
to disclose any such information other than as necessary to the prosecution or
defense of such dispute).

       

      (c)  Executive
acknowledges that all notes, memoranda, specifications, devices, formulas,
plans, reports, records, files, lists, drawings, documents, models, equipment,
property, computer and computer tapes, printouts, software or intellectual
property, and other documents and data relating to the businesses of the Company
or its Affiliates in whatever form (including electronic), and all copies
thereof, that are received or created by Executive while an officer, director or
employee of the Company or an Affiliate of the Company (including but not
limited to Confidential Information), whether prior to or following the date
hereof, are and shall remain the property of the Company or its Affiliates; and
Executive shall immediately return such property to the Company or its
Affiliates (as the case may be) upon the termination of Executive’s employment
and, in any event, at the Company’s or its Affiliate’s request (whether during
or after Executive’s employment with the Company).  Executive further
agrees that any property situated on the premises of the Company or its
Affiliates and owned by any of the foregoing, including disks and other storage
media, filing cabinets or other work areas, is subject to inspection by
personnel of the Company or its Affiliates at any time with or without
notice.

       

      (d)           Executive
agrees that the provisions of, covenants provided for in this Agreement,
including the term of the Restricted Period and the geographical area
encompassed in such covenants, are necessary and reasonable in order to protect
Parent, the Company, utilization of the Company’s assets, tangible and
intangible, including goodwill, and to preserve and protect the business and
tangible and intangible assets of the Company and its Affiliates, including
their goodwill, and the customers and trade secrets of which Executive has and
will have knowledge, and in consideration for Parent and Purchaser entering into
and performing under the Merger Agreement.  The Company and Executive
agree that the execution, delivery and performance of this Agreement is in
consideration of and a condition to the consummation of the Merger, and the
parties do not ascribe and cannot ascribe a separate consideration or value to
the covenants provided in this Agreement.

       

      (e)           During
the Restricted Period, the parties hereto shall not, whether in writing or
orally, criticize (excluding criticism shared internally within the Company and
its Affiliates made in connection with Executive’s duties as an executive level
employee of the Company or any of its Affiliates), denigrate or disparage
Executive, on the one hand, or Parent or the Company, on the other hand, or any
of their respective Affiliates or any of their respective current or former
directors, officers, employees, executives, agents or representatives, or any of
their respective direct and indirect successors, with respect to any of their
respective past or present activities, or otherwise publish (whether in writing
or orally) statements that tend to portray any of the aforementioned parties in
an unfavorable light.

       

      (M)           Section
12(a) of the Employment Agreement is hereby amended in its entirety to read as
follows:

       

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

      

       

      (a)  Executive
acknowledges that a violation by Executive of any of the covenants contained in
Section 9, 10 or 11 (the “Restrictive Covenants”) would
cause irreparable damage to the Company and its Affiliates in an amount that
would be material but not readily ascertainable, and that any remedy at law
(including the payment of damages) would be inadequate.  Accordingly,
Executive agrees that, notwithstanding any provision of this Agreement to the
contrary, the Company and Parent shall be entitled (without the necessity of
showing economic loss or other actual damage) to injunctive relief (including
temporary restraining orders, preliminary injunctions and/or permanent
injunctions) in any court of competent jurisdiction for any actual or threatened
breach of any of the covenants set forth in Section 9 or 11 in addition to any
other legal or equitable remedies it may have.  The preceding sentence
shall not be construed as a waiver of the rights that the Company or Parent may
have for damages under this Agreement or otherwise, and all rights of the
Company and Parent shall be unrestricted.  No remedy conferred upon or
reserved to any party herein is intended to be exclusive of any other remedy and
every remedy shall be cumulative and in addition to every other remedy herein or
now or hereafter existing at law, in equity or by statute.

       

      

       

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

      

       

      EXECUTIVE
ACKNOWLEDGES THAT HE HAS CAREFULLY READ THIS AMENDMENT AND UNDERSTANDS AND
AGREES TO ALL OF THE PROVISIONS IN THIS AGREEMENT.

      

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

       

      
         

        
          	 	 COMPANY

        

         

      

      
        	
                Date
      of Execution: May 12, 2005

              	
                By:

              	
                /s/
      James L. Starr

              
	 
      	 
      	
                Name:
      James L. Starr

              
	 
      	 
      	
                Title:
      Chief Financial Officer

              

      

      

      

      
         

        
           

          
            	 	 PARENT

          

           

        

      

      
        	
                Date
      of Execution: May 12, 2005

              	
                By:

              	
                /s/
      John L. Bridge

              
	 
      	 
      	
                Name:
      John L. Bridge

              
	 
      	 
      	
                Title:
      Vice President, Business
Development

              

      

      

      

      
        	 
      	 
      	
                LONNY
      REISMAN, M.D.

              
	 
      	 
      	 
      
	
                Date
      of Execution:  May 12, 2005

              	
                By:

              	
                /s/
      Lonny Reisman

              
	 
      	 
      	
                Address:

              
	 
      	 
      	
                Phone:

              
	 
      	 
      	
                Fax:

              

      

      

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
A

       

      EMPLOYMENT
AGREEMENT

      AMENDED
AND RESTATED EMPLOYMENT AGREEMENT

      

      This AMENDED AND RESTATED EMPLOYMENT
AGREEMENT (this “Agreement”) is made as of
December 21, 2004 between Active Health Management, Inc., a Delaware corporation
with an office at 102 Madison Avenue, New York, New York  10016 (the
“Company”), and Lonny
Reisman, M.D., an individual residing at 18 Sutton Terrace, Jericho, New
York  11753 (“Executive”).

      

      W I T N E S S E T H :

       

      WHEREAS, the Company (formerly known as
ARMS Corporation) and Executive are parties to an Employment Agreement dated as
of September 1, 1998 (the “Original Employment
Agreement”), and the Company and Executive wish to amend and restate the
terms of the Original Employment Agreement as hereinafter set
forth;

       

      WHEREAS,
the Company wishes to continue to retain the services of Executive on terms and
conditions mutually agreeable and beneficial to the Company and Executive;
and

       

      WHEREAS,
Executive is willing to continue to render his services to the Company pursuant
to the terms and conditions hereof;

       

      NOW,
THEREFORE, in consideration of the premises and of the mutual promises,
representations and covenants herein contained, the parties hereby agree as
follows:

       

      1. EMPLOYMENT.  The
Company hereby employs Executive and Executive hereby accepts such employment,
subject to the terms and conditions herein set forth.  Executive shall
serve in the position of Chief Executive Officer of the Company.

       

      2. TERM.  This
Agreement shall commence on the date hereof and shall continue in full force and
effect until December 31, 2008.  Thereafter, this Agreement shall
automatically be renewed for successive terms of one year each unless either
party shall give the other party written notice, at least 90 days prior to the
end of the then current term, of its or his intent not to renew this
Agreement.  Notwithstanding the foregoing, this Agreement may be
terminated prior to the expiration of the then current term under the
circumstances described in Section 7 below in accordance with the provisions
thereof.

       

      3. COMPENSATION.

       

      (a)            Base Salary.  As
compensation for the employment services to be rendered by Executive hereunder,
including all services as an officer of the Company and any of its subsidiaries
or affiliates (“related
entities”), the Company agrees to pay, or cause to be paid, to Executive,
and Executive agrees to accept, an annual salary of $365,000.00, payable in
equal installments in accordance with Company practice. The foregoing salary
shall be reviewed annually by the Board of Directors of the Company (the “Board”) or its Compensation
Committee, which shall consider, in its sole discretion, whether to increase the
same in light of increased responsibilities, changes in the cost of living and
other factors which the Board may deem relevant.

       

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

       

      (b)            Other
Compensation.  In addition to the base salary provided for in
Section 3(a) hereof, in respect of calendar year 2004 and each calendar year
thereafter during the term hereof, Executive shall also be eligible to receive
additional compensation in the form of a performance bonus (a “Bonus”) for such year
pursuant to a bonus plan established and administered by the Board (or its
Compensation Committee), in its sole discretion, for the benefit of the
Company's senior management.  The amount of the Bonus for each year,
if any, shall be a function of Executive's efforts and performance, as well as
the Company's growth, results of operations and financial condition, and such
other factors as the Board (or its Compensation Committee) may, in its sole
discretion, deem relevant.  The Company shall have no obligation to
establish such a bonus plan, or to pay to Executive any Bonus thereunder, if the
Board (or its Compensation Committee), in its sole discretion, determines not to
establish such a plan and/or not to make a payment under such a plan to
Executive.

       

      4.            EXPENSES.  The
Company shall pay or reimburse Executive, upon presentment of suitable vouchers,
for all reasonable business and travel expenses which may be incurred or paid by
Executive in connection with his employment hereunder.  Executive
shall comply with such restrictions and shall keep such records as the Company
may deem necessary to meet the requirements of the Internal Revenue Code of
1986, as amended from time to time, and regulations promulgated
thereunder.

       

      5.            OTHER
BENEFITS.

       

      (a)           Executive
shall be entitled to vacation at the rate of four (4) weeks per year, with
vacation time to accrue based upon the accrual schedule set forth in the
Company's Employee Handbook.  All vacation days shall be taken at such
times as do not unreasonably interfere with the business of the
Company.  Executive may be entitled to carry unused vacation time
forward from year to year, and to be compensated for any unused vacation time,
in accordance with the policy of the Company with respect to such matters in
effect from time to time.

       

      (b)           Executive
shall be entitled to participate in all pension and welfare plans, programs and
benefits offered by the Company generally with respect to senior officers of the
Company, all as determined from time to time by the Company's Board of
Directors, in accordance with the terms and conditions of such plans and
programs.

       

      (c)           The
Company shall provide medical malpractice insurance coverage covering acts and
omissions of Executive as a physician, which coverage shall include acts and
omissions of Executive in the private practice of medicine as described in
Section 6(b) below.

       

      6.            DUTIES.

       

      (a)            Executive
shall be subject to the direction of the Board of Directors of the
Company.  Executive shall perform such duties and functions
appropriate to the position of Chief Executive Officer as the Board of Directors
of the Company shall from time to time determine. At the request of the Board of
Directors of the Company, Executive shall serve as a senior officer and/or
director of any related entity of the Company.

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

       

      

       

      (b) During
the term of this Agreement, Executive shall devote all of his working time and
attention, reasonable vacation time and absences for sickness excepted, to the
business of the Company, as necessary to fulfill his
duties.  Executive shall perform the duties assigned to him with
fidelity and to the best of his ability.  Executive shall deal at all
times in good faith with the Company and shall conduct himself at all times in
the best interest of the Company.  Notwithstanding anything herein to
the contrary, Executive may engage in other activities so long as such
activities do not unreasonably interfere with Executive's performance of his
duties hereunder and do not violate Section 9 hereof.  Without
limiting the generality of the foregoing, the occasional private practice of
medicine, in accordance with Executive's medical licenses and consistent with
his board certifications, shall be deemed to be described in this Section 6(b)
and shall be deemed not to unreasonably interfere with Executive's performance
of his duties hereunder and not to violate the provisions of Section 9 hereof;
provided, that such private practice of medicine shall not require more than an
average of five (5) hours per week of Executive's time during normal business
hours.

       

      (c) The
principal location at which Executive shall perform his duties hereunder shall
be at the offices of the Company in New York, New York, or as reasonably changed
in the future, although Executive understands and agrees that he will be
required to travel from time to time for business reasons.

       

      7.            TERMINATION
OF EMPLOYMENT; EFFECT OF TERMINATION.

       

      (a)            This
Agreement and Executive's employment hereunder shall be terminated:

       

      (1) (i) at
any time for any reason which would not constitute “Justifiable Cause” (as hereinafter
defined), upon 90 days’ prior written notice of termination from the Company to
Executive or (ii) at any time under circumstances constituting “Good Reason” (as such term is
hereinafter defined), upon 10 days’ prior written notice of termination from
Executive to the Company; or

       

      (2) (i)
following the determination by the Board that there is Justifiable Cause for
such termination, upon 10 days’ prior written notice of termination from the
Company to Executive or (ii) at any time for any reason other than Good Reason,
upon 30 days’ prior written notice of termination from Executive to the Company;
or

       

      (3) immediately
upon the death of Executive; or

       

      (4) in the
event of the “Disability” (as hereinafter
defined) of Executive, upon 30 days’ prior written notice from the Company to
Executive.

       

      As used
herein, the following capitalized terms shall have the following
meanings:

       

      “Justifiable Cause” shall mean
and be limited to: (1) Executive’s conviction (which, through lapse of time or
otherwise, is not subject to appeal) of or pleading guilty to any crime (i)
involving theft, embezzlement or other misappropriation of money or other
property of the Company, its related entities or any other business enterprise;
(ii) involving moral turpitude;

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

       

      or (iii)
which constitutes a felony in the jurisdiction involved; (2) Executive’s
engagement in a fraudulent act to the material damage or prejudice of the
Company or its related entities or in conduct or activities materially damaging
to the property, business or reputation of the Company or its related entities
(including, without limitation, gross negligence in the performance of
Executive’s duties hereunder or any act which may expose the Company to
liability for violation of the civil rights of any other employee of the
Company), all as reasonably determined by the Board; (3) Executive’s
substantiated illegal use of controlled substances; (4) the entry of an order of
a court that remains in effect and is not discharged for a period of at least 60
days, which enjoins or otherwise limits or restricts the performance by
Executive under this Agreement, relating to any material contract, agreement or
commitment made by or applicable to Executive in favor of any former employer or
any other person; or (5) a breach by Executive of any of the material terms of
this Agreement, as reasonably determined by the Board.

       

      “Good Reason” shall mean and
be limited to: (1) breach by the Company of any of the material terms of this
Agreement, which breach shall remain uncured 30 days after the Company's receipt
of a written notice from Executive specifying the nature of the breach; (2)
relocation of the Company’s principal executive officers to a location more than
50 miles from New York, New York; (3) a material diminution of Executive’s
duties and responsibilities hereunder, which diminution shall remain in effect
30 days after the Company’s receipt of a written notice from Executive
specifying the diminution to which he objects; or (4) a material diminution of
Executive’s entire compensation or employee benefits hereunder.

       

      “Disability” shall have the
meaning assigned to such term in any long-term disability plan or program of the
Company in which Executive is entitled to participate; provided, however, that
in the absence of any such plan or program, “Disability” shall mean
Executive’s inability to substantially perform his duties hereunder by reason of
any medically determined physical or mental impairment which can be expected to
result in death or which has lasted or can be expected to last for any
substantially continuous period of not less than six (6) months.

       

      (b)            Upon
any early termination of this Agreement, except as provided below, Executive
shall not be entitled to receive further compensation hereunder for any period
of time after such date.  Notwithstanding the foregoing, if (i) this
Agreement is terminated in a “Severance Circumstance” (as
defined below) and (ii) Executive shall have executed a valid and comprehensive
release in the form prescribed by the Company of any and all claims Executive
may have against the Company and any of its related entities, except as set
forth in Section 7(c) hereof (the “Severance Release”), within ten days after
the Company provides the same for execution by Executive:

       

      (1) Executive
shall be entitled to receive payments of Executive’s then annual salary, at the
rate then in effect pursuant to Section 3(a), for a period of one year after the
effective date of termination (the “Severance
Period”);

       

      (2) The
Company shall continue to provide, at the Company’s expense, coverage under
plans or policies providing employee benefits as described in Section 5 hereof
(or comparable benefits) during the Severance Period;

       

      

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      (3) Notwithstanding
anything to the contrary contained in the Company’s Series Fl Stock Option Plan
(the“F1 Plan”) or any
other stock option plan of the Company relating to options (“Fl Options”) to purchase
shares of the Company's Series Fl Preferred Stock, par value $.01 per share
(“Fl Preferred”), or in the Incentive
Stock Option Agreement made as of September 10, 2002 (the “2002 Fl Option Agreement”) or
any other stock option agreement relating to Fl Options, (A) Executive’s Fl
Options outstanding on the date of termination (including, without limitation,
his Fl Options to purchase 1,175,000 shares of F1 Preferred (the “2002 Fl Options”), pursuant
to the 2002 F1 Option Agreement and the F1 Plan) shall remain outstanding and
continue to vest, and shall otherwise be treated for purposes of the terms and
conditions thereof as if Executive remained in the employ of the Company,
through the second (2nd) anniversary of the date of such termination (the “Vesting Termination Date”),
and (B) the expiration date of the exercise period for all such Fl Options
(including, without limitation, the 2002 Fl Options) shall be the Vesting
Termination Date, and all such Fl Options which are vested shall be exercisable
on or prior to such date; and

       

      (4) Notwithstanding
anything to the contrary contained in the Company’s Amended and Restated 1999
Stock Option Plan (the “Common
Plan”) or any other stock option plan of the Company relating to options
(“Common Options”) to purchase shares of
Common Stock of the Company (“Common Stock”), or in the Non-Qualified
Stock Option Agreement made as of December 21, 2004 (the “2004 Common Option
Agreement”) or any other stock
option agreement relating to Common Options, (A) Executive’s Common Options
outstanding on the date of termination (including, without limitation, his
Common Options to purchase 100,000 shares of Common Stock (the “2004 Common Options”) pursuant to the 2004
Common Option Agreement and the Common Plan) shall remain outstanding and
continue to vest, and shall otherwise be treated for purposes of the terms and
conditions thereof as if Executive remained in the employ of the Company through
the Vesting Termination Date, and (B) the expiration date of the exercise period
for all such Common Options (including, without limitation, the 2004 Common
Options) shall be the Vesting Termination Date, and all such Common Options
which are vested shall be exercisable on or prior to such date.”

       

      The
Company shall take all actions necessary or advisable to give effect to this
Section 7(b). Such severance payments in clause (x) above shall be made in equal
installments throughout the Severance Period at the same times at which salary
payments are made to the Company’s employees generally.

       

      As used
herein, the term “Severance
Circumstance” means the termination of this Agreement pursuant to Section
7(a)(1) hereof or the Company’s election not to renew this Agreement at the end
of its then current term pursuant to Section 2 hereof.

       

      (c)            Immediately
upon termination of this Agreement, at the election of the Company’s Chairman of
the Board, Executive shall cease all activities at or on behalf of the Company
and shall return to the Company all documents, records and files of the Company,
and the Company shall have no further obligations to Executive except for
payment of (w)

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

       

      Executive’s
annual salary earned through the termination date; (x) reimbursable expenses
incurred by Executive prior to the termination date; (y) any Bonus payable to
Executive in respect of any prior bonus period which remains unpaid; and (z) if
applicable, severance payments and other termination benefits set forth in
subsection (b) above.  Notwithstanding the foregoing, the
indemnification provisions set forth in Section 8(a) hereof shall survive any
termination of this Agreement.

       

      (d)            In
the event of the termination or expiration of this Agreement for any reason, the
Company reserves the right, to the extent permitted by law and in addition to
any other remedy the Company may have, to deduct from any monies otherwise
payable to Executive the full amount of any debt Executive may owe to the
Company or any of its related entities at the time of or subsequent to the
termination or expiration of this Agreement.  In the event that the
law of any state or other jurisdiction requires the consent of an employee for
such deductions, this Agreement shall serve as such consent.

       

      8.            REPRESENTATIONS
AND AGREEMENTS OF EXECUTIVE.

       

      (a) Executive
represents and warrants to the Company that the execution, delivery and
performance by Executive of this Agreement will not result (with or without the
giving of notice or the lapse of time or both) in any conflict, violation,
breach or default on the part of Executive under any agreement or understanding,
whether written or oral, to which Executive is a party or by which he is
bound.  Executive shall indemnify and hold harmless the Company from
and against any liabilities, claims, damages and expenses for any losses
resulting from any such conflict, violation, breach or default.

       

      (b) Executive
agrees that he shall comply with any and all employee handbooks, policy manuals
and similar documents of the Company.

       

      (c) Executive
agrees to submit to a medical examination and to cooperate and supply such other
information and documents as may be required by any insurance company in
connection with the Company’s obtaining any type of insurance or fringe benefit
as the Company shall determine from time to time to obtain.

       

      9.            NON-COMPETITION;
NON-SOLICITATION; ETC.

       

      (a)            In
consideration of the Company's award to Executive the 2004 Common Options on or
about the date of this Agreement, and for other good and valuable consideration,
the receipt and adequacy of which is hereby acknowledged, Executive agrees that
during the “Non-Compete
Period” (as defined below), Executive shall not, directly or indirectly,
as owner, lender, partner, joint venturer, stockholder, employee, agent,
principal, trustee, officer, director, or in any capacity whatsoever, engage in,
become financially interested in, be employed by, or render any consultation or
business advice or other services with respect to (i) any business which
provides or offers products or services, in any geographic area in the United
States of America, which are competitive with any products or services of the
Company or any of its related entities in the following lines of business: (x)
healthcare disease management, (y) the line of business consisting of the suite
of services currently offered under the rubric of the Company’s “CareEngine”
registered trademark or (z) any other line of business in which
the

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

       

      Company
or any of its related entities is materially engaged during the period of
Employee’s employment hereunder or (ii) any business conducted under any
corporate or trade name utilized by the Company or any related entity without
the prior written consent of the Company; provided, however, that Executive may
own any securities of the Company or any of its related entities, and any
securities of any corporation which is engaged in such business and is publicly
owned and traded but in an amount not to exceed at any one time one percent (1%)
of any class of stock or securities of such publicly traded
corporation.

       

      As used
herein, the term “Non-Compete
Period” shall mean the period during the term of this Agreement and a
further period of two (2) years following the expiration or termination of this
Agreement for any reason pursuant to Section 7(a) hereof, whether or not
Executive timely executes the Severance Release (if applicable) as called for by
Section 7(b) hereof; provided, in the case of a termination pursuant to Section
7(a)(1) hereof, the Non-Compete Period shall be deemed to cease if the Company
fails to pay when due any periodic installment of the severance obligation
pursuant to Section 7(b) hereof and such payment default shall remain uncured 10
days following the Company’s receipt of a written default notice from
Executive.”

       

      (b) In
addition, Executive agrees that during the term hereof and for a period of two
(2) years thereafter he shall not, directly or indirectly: (i) request or cause
any suppliers or customers with whom the Company or any of its related entities
has a business relationship to cancel, terminate or diminish any such business
relationship with the Company or any of its related entities; (ii) solicit,
interfere with or entice or hire from the Company or any of its related entities
any employee of the Company or any of its related entities (or former employee
who had terminated his or her employment with the Company or any of its related
entities during the three-month period prior to the expiration or termination of
this Agreement); or (iii) in any communications with any customer, investor,
vendor, business partner or client of the Company or any of its related
entities, criticize, ridicule or make any statement which disparages or is
derogatory of the Company or any of its related entities or any of their
respective officers, directors, agents or employees.

       

      (c) If any
portion of the restrictions set forth in this Section 9 should, for any reason
whatsoever, be declared invalid by a court of competent jurisdiction, the
validity or enforceability of the remainder of such restrictions shall not
thereby be adversely affected.

       

      (d) Executive
acknowledges that the historical business operations of the Company and its
related entities have been conducted throughout the United States, that the
sales and marketing prospects of such organizations are for continued expansion
throughout the United States and that, therefore, the territorial and time
limitations set forth in this Section 9 are reasonable and properly required for
the adequate protection of the business of the Company and its related
entities.  In the event any such territorial or time limitation is
deemed to be unreasonable by a court of competent jurisdiction, Executive agrees
to the reduction of the territorial or time limitation to the area or period
which such court shall deem reasonable.

       

      (e) Notwithstanding
anything herein to the contrary, this Section 9 shall automatically terminate
with respect to the Company or any of its related entities (x) upon the
dissolution of such entity or (y) if a court of competent jurisdiction shall
enter an order, judgment or decree approving a petition seeking liquidation of
such entity under Chapter 7 of the United

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

       

      States
Bankruptcy Code, or under comparable provisions of any state insolvency laws,
and such order, judgment, decree is not dismissed or vacated within a period of
sixty (60) consecutive days.

       

      10.           INTELLECTUAL
PROPERTY

       

      (a) Executive
agrees that any innovations, improvements or business concepts that he may
develop or suggest during the term of this Agreement relating to the work or
projects carried on by Executive on behalf of the Company or any of its related
entities and any other results or proceeds of Executive’s employment by the
Company (collectively, the “Works and Intellectual Property”)
shall constitute works-made-for-hire and shall be the exclusive property
of the Company.  Executive further agrees to make full disclosure
thereof to an authorized representative of the Company, and to no other person
without the consent of the Chairman of the Board of the Company and, to the
extent any of the Works and Intellectual Property do not legally constitute a
work-made-for-hire and/or there are any other rights with respect to the Works
and Intellectual Property that do not accrue to the Company pursuant to the
preceding sentence, Executive hereby irrevocably assigns and agrees to assign
without further compensation all such Works and Intellectual Property and all
rights thereto, domestic and foreign, to the Company.  Executive
hereby agrees to execute all documents whatsoever that may be necessary to
transfer to and vest in the Company all right, title and interest in and to all
of the Works and Intellectual Property.

       

      (b) All
documents, data, recordings or other property, whether tangible or intangible,
including all information stored in electronic form, obtained or prepared by or
for Executive and utilized by Executive in the course of Executive’s employment
hereunder shall remain the exclusive property of the Company.

       

      11.          NON-DISCLOSURE
OF CONFIDENTIAL INFORMATION.

       

      (a) Executive
shall not, during the term of this Agreement, or at any time thereafter,
directly or indirectly, disclose or permit to be known (other than (i) as
required in the regular course of his duties, including without limitation
disclosures to the Company’s advisors and consultants, or (ii) as required by
law, in which case Executive shall give the Company prior written notice of such
required disclosure) to any person, firm or corporation any Confidential
Information acquired by him during the course of, or as an incident to, his
employment or the rendering of his advisory or consulting services hereunder,
relating to the Company or any of its related entities, the directors of the
Company or its related entities, any client of the Company or any of its related
entities, or any corporation, partnership or other entity owned or controlled,
directly or indirectly, by any of the foregoing, or in which any of the
foregoing has a beneficial interest, including, but not limited to, the business
affairs of each of the foregoing. Notwithstanding the foregoing, Executive may
disclose Confidential Information to his personal legal and financial advisors
in the course of obtaining their advice and counsel.  Any breach by
any of such advisors of the terms of this Section 11 shall be deemed a breach by
Executive.

       

      (b) The term
“Confidential Information”
shall mean all information and know-how (whether or not in writing) of a
confidential, secret, private or proprietary nature concerning the Company, any
of its related entities and their respective businesses and
affairs

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

       

      and shall
include, but shall not be limited to, proprietary technology, trade secrets,
patented processes, research and development data, know-how, market studies and
forecasts, competitive analyses, pricing policies, employee lists, personnel
policies, the substance of agreements with customers, suppliers and others,
marketing or dealership arrangements, servicing and training programs and
arrangements, customer lists and any other documents embodying such confidential
information.  Notwithstanding anything to the contrary contained
herein, Confidential Information shall not include (i) any information which is
or becomes publicly available other than pursuant to a breach of Sections 11(a)
or 11(c) by Executive or (ii) information which is independently developed by
Executive after the expiration or termination of this Agreement without making
use of the Confidential Information.

       

      (c)            All
Confidential Information and documents and materials containing Confidential
Information of the Company or any of its related entities shall be the exclusive
property of the Company, and Executive shall use commercially reasonable best
efforts to prevent any publication or disclosure thereof.  Upon
expiration or termination of this Agreement, all documents, records, reports,
writings and other similar documents containing Confidential Information,
including copies thereof, then in Executive’s possession or control shall be
returned to and left with the Company.

       

      12.           SPECIFIC
PERFORMANCE; RELEASE OF COMPANY OBLIGATIONS.

       

      (a) Executive
agrees that if he breaches, or threatens to commit a breach of, any of the
provisions of Sections 9, 10 or 11 (the “Restrictive Covenants”), the Company shall have,
in addition to, and not in lieu of, any other rights and remedies available to
the Company under law and in equity, the right to injunctive relief and/or to
have the Restrictive Covenants specifically enforced by a court of competent
jurisdiction, it being agreed that any breach or threatened breach of the
Restrictive Covenants would cause irreparable injury to the Company and its
related entities and that money damages would not provide an adequate remedy to
the Company.

       

      (b) If
Executive breaches his obligations pursuant to the Restrictive Covenants, then
without limiting any other remedy that the Company may have at law, the Company
shall be released from any remaining obligation to Executive that it would
otherwise have thereafter.

       

      13.            AMENDMENT
OR ALTERATION.  No amendment or alteration of the terms of this
Agreement shall be valid unless made in writing and signed by both of the
parties hereto.

       

      14.            GOVERNING
LAW; VENUE.  This Agreement shall be governed by and construed in
accordance with the law of the State of New York applicable to agreements made
and to be performed therein, without giving effect to its principles of
conflicts of law.  The parties hereto irrevocably and exclusively
submit to the jurisdiction of the courts of the state of New York and the
federal courts of the United States located in the Southern District of New
York, and any appellate court from any thereof, with respect to any suit, action
or proceeding pertaining to this Agreement.

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

       

      

       

      15. SEVERABILITY.  The
holding of any provision of this Agreement to be invalid or
unenforceable by a court of competent jurisdiction shall not affect any other
provision of this Agreement, which shall remain in full force and
effect.

       

      16. NOTICES.  Any
notices required or permitted to be given hereunder shall be sufficient if in
writing, and if delivered by hand or courier, or sent by certified mail, return
receipt requested, to the addresses set forth above or such other address as
either party may from time to time designate in writing to the other, and shall
be deemed given as of the date of the delivery or at the expiration of three
days in the event of a mailing.

       

      17. WAIVER OR
BREACH.  It is agreed that a waiver by either party of a breach of any
provision of this Agreement shall not operate, or be construed, as a waiver of
any other provision or of any subsequent breach by that same party.

       

      18. ENTIRE
AGREEMENT; SUPERSESSION; AMENDMENT; BINDING EFFECT.  This Agreement
contains the entire agreement between the Company and its related entities, on
the one hand, and Executive, on the other hand, with respect to the subject
matter hereof and supersedes all prior agreements, both written and oral,
between the Company and its related entities, on the one hand, and Executive, on
the other hand, with respect to the subject matter hereof including, without
limitation, the Original Employment Agreement (except for Sections 13 and 14
thereof and the documents referenced therein, which shall remain in full force
and effect).  This Agreement may be modified only by a written
instrument signed by each of the parties hereto.  This Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective legal representatives, heirs, distributors, successors and assigns,
provided, however, that Executive shall not be entitled to assign or delegate
any of his rights or obligations hereunder without the prior written consent of
the Company.

       

      19. WITHHOLDINGS.  All
amounts paid to Executive under this Agreement shall be subject to customary
withholdings for income taxes, F.I.C.A. and similar charges.

       

      20. SURVIVAL.  Except
as otherwise expressly provided herein, the termination or the expiration of
this Agreement shall not affect the enforceability of Sections 7(b), 7(c), 7(d),
8(a) and (b), and 9 through 23 hereof.

       

      21. FURTHER
ASSURANCES.  The parties agree to execute and deliver all such further
documents, agreements and instruments and take such other and further action as
may be necessary or appropriate to carry out the purposes and intent of this
Agreement.

       

      22. CONSTRUCTION
OF AGREEMENT.  No provision of this Agreement or any related document
shall be construed against or interpreted to the disadvantage of any party
hereto by any court or other governmental or judicial authority by reason of
such party having or being deemed to have structured or drafted such
provision.

       

      23. HEADINGS.  The
Section headings appearing in this Agreement are for the purposes of easy
reference and shall not be considered a part of this Agreement or in any way
modify, demand or affect its provisions.

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

       

      

       

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

       

      

       

      

       

      

      
        	 
      	
                ACTIVE
      HEALTH MANAGEMENT, INC.

              

      

       

      

       

      

       

      

      
        	 
      	
                By:

              	
                /s/ Albert S.
      Waxman

              
	 
      	 
      	
                Albert
      S. Waxman, Ph. D.

              
	 
      	 
      	
                Chairman
      of the Board

              

      

       

      

       

      

       

      

      
        	 
      	
                /s/ Lonny
      Reisman

              
	 
      	
                Lonny
      Reisman, M.D.

              

      

       

      

      

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

      EXHIBIT
B

      

      EMPLOYEE
CONFIDENTIALITY AND ASSIGNMENT OF INVENTIONS AGREEMENT

      

      I understand that Active Health
Management, Inc., a Delaware corporation (together with its subsidiaries and
affiliates, the “Company”), has developed and used, and will be developing and
using information and know-how, both tangible and intangible, that has or could
have commercial value or other utility in the business in which the Company is
engaged or contemplates engaging, and the unauthorized disclosure of which could
be detrimental to the interests of the Company (collectively, “Confidential
Information”).  Confidential Information includes, but is not limited
to, (i) formulas, research and development techniques, processes, trade secrets,
computer programs, software, electronic codes, mask works, inventions,
innovations, patents, patent applications, discoveries, improvements, data,
know-how, formats, test results, and research projects; (ii) information about
costs, profits, markets, sales, contracts and lists of suppliers and customers
(whether actual or prospective); (iii) business, marketing, and strategic plans;
(iv) forecasts, unpublished financial information, budgets and projections; and
(v) employee personnel files and compensation information.  This
information was developed and will be developed by Company at great expenses and
constitutes trade secrets of Company.  To safeguard its Confidential
Information, Company has instituted policies and procedures to protect such
information.  In connection with my employment by Company, I will come
into contact with Confidential Information.  I understand that the
Confidential Information is vital to the success of Company’s business and, in
consideration of my employment by Company and the consideration to be paid to me
for my services, I state the following:

      

      1.           I
agree that during and after my term of engagement with Company:

      

      (a) I shall keep secret all
Confidential Information and not reveal or disclose it to anyone outside of
Company, except with Company’s prior written consent;

      

      (b) I shall not make use of any such
Confidential Information for my own purposes or the benefit of anyone other than
Company; and

      

      (c) I shall deliver promptly to
Company, upon the termination of my engagement and at any time Company may so
request, all software, data, memoranda, notes, records and other documents (and
all copies thereof) constituting or relating to such Confidential Information
which I may then possess.

      

      2.           All
work which I create in connection with my engagement shall be considered to be
“works made for hire” under the U.S. Copyright Act, 17 U.S.C. 101 et
seq.  In the event a work is not construed to be a work made for hire,
I assign, and will assign to Company all my rights and interests in any
developments, designs, inventions, improvements, trade secrets, trademarks,
copyrightable subject matter or proprietary information which I have made or
conceived, or may make or conceive, either solely or jointly with others and
either on or off Company’s premises, (i) while providing services to Company,
(ii) with the use of the time, materials or facilities of Company, (iii)
relating to any product, service or activity of Company of which I have
knowledge, or (iv) suggested by or resulting from any work performed by me for
Company (collectively, the “Developments”).  I agree that I have no
proprietary interest in any Developments, including any patent, copyright,
trademark and trade secret rights.  Any and all programs, inventions
and other

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      works of
authorship developed by me while performing services for Company are created for
and owned exclusively by Company.  I agree that I shall sign any
papers necessary for patents, copyrights or trademarks to conform to and protect
the interest of Company in the Developments and that I shall not register, file
or obtain any patent, copyright or trademark covering any of Developments in my
own name and I further agree to provide necessary assistance to protect, enforce
or perfect Company’s rights and interests in such patents, copyrights and
trademarks.

      

      3.           I
understand that this Agreement shall be governed by and construed in accordance
with the laws of the State of New York.  I understand that any suit,
action or proceeding for enforcement of this Agreement may be brought in a court
located in the county and City of New York and I hereby irrevocably and
unconditionally submit to the exclusive jurisdiction of any such
court.

       

      
 

      AGREED TO
AND ACCEPTED:

       

      
 

      

      
        	
                Name

              	 Lonny Reisman 	 
      
	 
      	 
      	 
      
	
                Signature:

              	 /s/
      Lonny Reisman 	 
      
	 
      	 
      	 
      
	
                Date:

              	 12/6/02
      	 
      

      

      

      

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
C

      

      

      Special
Bonus Opportunity

      Based
on Company Financial Performance for 2006 and 2007

      

      INTENTIONALLY
OMITTED

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