Document:

Barron Employment Agreement

    EXHIBIT
      10.25

    

    EMPLOYMENT
      AGREEMENT

    

    

    THIS
      EMPLOYMENT AGREEMENT (the “Agreement”) is entered into as of the first day of
      January 2005, by and between Bruce
      N. Barron
      (“Employee”), and APPLIED NEUROSOLUTIONS, INC. ("APNS"), a Delaware corporation
      having its principal place of business in Vernon Hills, Illinois (the
“Company”). In consideration of the mutual covenants and conditions set forth
      herein, the parties hereby agree as follows:

    

    1. Employment.
      The
      Company hereby employs Employee to serve as its Chairman and Employee hereby
      accepts such employment. In his capacity as Chairman, Employee shall be
      responsible for performing the duties of the Chairman as outlined in the
      Corporate By-Laws, and agrees to perform such other duties during the term
      hereof as the Board of Directors of the Company shall, from time to time,
      reasonably direct. Employee agrees to utilize his skills and to render services
      to the best of his ability during the term of this Agreement.

    

    

    2. Term.
      Unless
      earlier terminated pursuant to the provisions of Paragraph 6 below, Employee’s
      employment hereunder shall be for a period of one (1) year commencing on January
      1, 2005 and shall be extended automatically for additional one (1) year period,
      unless either the Company or the Employee delivers written notice to the other
      of its or his election not to extend at least thirty (30) days prior to the
      end
      of either the initial or any additional term, as applicable. If the Company
      decides not to extend this Agreement within the ninety (30) day period described
      in the immediately preceding sentence for reasons other than “cause” (as defined
      in Paragraph 6a below), the Employee shall receive a severance payment equal
      to
      the final year’s Base Salary (as defined in Paragraph 3 below) with respect to
      the initial or additional term that was last completed, plus the amount of
      the
      bonus earned by the Employee in such year. Such severance payment shall be
      payable over a one (1) year period in the same manner as the Employee had been
      paid under this Agreement in such year, with payments to begin within two (2)
      weeks of the end of the current term of employment under this
      Agreement.

    

    

    3. Compensation.

    

    a. Base
      Salary.
      For all
      services rendered by Employee under this Agreement, Employee shall receive
      a
      salary at an annual rate of $48,000 as increased under Paragraphs 3b and 4c
      (“Base Salary”), or such higher annual rate as the Board of Directors of the
      Company may from time to time establish in its sole direction.

    

    b. Stock
      Option Plans.
      The
      Company has adopted stock option and/or stock purchase plans for the benefit
      of
      certain Employees of the Company. Employee shall be entitled to participate
      in
      such plans, consistent with the terms of such plans, applicable law and Company
      Policy.

    

    

    4. Benefits.

    

    a. Medical/Health
      and Disability Insurance.
      The
      Company shall provide Employee with Company paid medical and dental insurance
      which covers Employee, his spouse and dependents, in accordance with such
      policies as shall be maintained by the Company, which shall be comparable to
      that made available to other employees of the Company. The Company’s benefit
      plan shall provide disability insurance for the benefit of Employee through
      a
      Company plan reasonably acceptable to Employee.

    

    b. Expense
      Reimbursement.
      The
      Company shall pay or reimburse Employee for all reasonable travel and other
      expenses incurred or paid by Employee in connection with the performance of
      services under this Agreement upon presentation of expense vouchers and such
      other supporting information as the Company may from time to time reasonably
      request.

    

    

    5. Warranties
      and Indemnification.
      Employee represents to the Company that Employee is free to enter into this
      Agreement and that Employee has no commitment, arrangement or understanding
      to,
      or with, any third party which restrains or is in conflict with this Agreement;
      or which would operate to prevent Employee from performing the services to
      the
      Company which Employee hereby has agreed to provide. Employee agrees to
      indemnify and hold the Company harmless from and against any and all liabilities
      or claims, including costs, expenses and reasonable attorney’s fees arising out
      of any acts by Employee which, the foregoing representation or warranty to
      the
      contrary notwithstanding, shall be in violation of or shall constitute a breach
      of any such commitment, arrangement or understanding.

    

    

    6. Termination.

    

    a. The
      Company may terminate Employee’s employment hereunder upon thirty (30) days’
prior written notice to Employee for cause, and except as provided below, the
      salary and benefits referred to in Paragraphs 3 and 4 above shall cease upon
      the
      effective date of any such termination for just cause. As used herein, with
      respect to termination by the Company, the term “cause” shall mean (i) any
      material breach hereof by Employee which is not cured within thirty (30) days
      following written notice of such breach given by the Company, provided that
      no
      such prior notice and opportunity to cure need be given where such breach,
      or
      similar breach, has been the subject of such a notice and cure period on more
      than two prior occasions; or (ii) conviction of Employee for commitment of
      a
      felony; or (iii) any act of Employee, which in the reasonable judgment of a
      majority of the Board of Directors of the Company, constitutes dishonesty,
      larceny, fraud, deceit or gross negligence by Employee in the performance of
      his
      duties to the Company or willful misrepresentation to shareholders, directors
      or
      officers of the Company.

    

    b. The
      Company may, by action of a majority of the Board of Directors, terminate
      Employee’s employment at any time upon thirty (30) days’ prior written notice
      and without cause; provided, that prior to the effective date of termination,
      the Company shall pay to Employee an amount equal to the total Base Salary
      otherwise payable through the expiration of the term of this Agreement as set
      forth at Paragraph 2 above. Health disability and life insurance, as described
      in Paragraph 4(a) above, equivalent to that provided to Employee during last
      month of employment, will be provided to Employee for up to twelve months
      following the effective date of termination.

    

    c. Employee
      may terminate his employment hereunder at any time upon thirty (30) days’ prior
      written notice to the Company for cause. The amounts identified in Paragraph
      6b
      shall be paid to Employee as of the effective date of termination, together
      with
      the continuing benefits described therein, as Employee’s sole remedy. As used
      herein with respect to termination by Employee, “cause” shall mean (i) any
      material breach hereof by the Company which is not cured within thirty (30)
      days
      following written notice of such breach given by Employee; (ii) repeated and
      consistent bad faith attempts to bring about Employee’s resignation through
      obstruction by the Company of operations and programs of Employee in his
      capacity hereunder; (iii) the removal of Employee from the position of Chairman,
      or the appointment of another person to perform the duties ordinarily associated
      with such position(s) without the formal removal of Employee’s title(s); or (iv)
      the transfer of Employee or the relocation of the principal offices from which
      the activities of the Company are conducted to an area more than fifty (50)
      miles outside the Village of Vernon Hills.

    

    d. If
      Employee terminates his employment without cause, such termination shall be
      treated as a termination with cause by the Company, as provided in Subparagraph
      6a above (but without the necessity of any prior notice by the
      Company).

    

    e. Any
      dispute between the parties as to the meaning or presence of “cause” for
      termination shall be resolved by binding arbitration conducted before a single
      arbitrator in the Chicago, Illinois area under the Commercial Arbitration Rules
      of the American Arbitration Association, provided that the arbitrator shall
      be a
      person of extensive experience in the arbitration of disputes under private
      employment agreements applicable to management personnel in industries similar
      to the Company’s industry.

    

    f. This
      Employment Agreement shall be terminated by the death of the Employee. In
      addition, this Employment Agreement may be terminated by the Board of Directors
      of the Company if the Employee shall be rendered incapable by illness or any
      other disability from complying with the terms, conditions and provisions on
      his
      part to be kept, observed and performed for a period in excess of one hundred
      twenty (120) days (whether or not consecutive) during a twelve (12) month period
      during the Term of Employment (“Disability”). If this Employment Agreement is
      terminated by reason of Disability of the Employee, the Company shall give
      written notice to that effect to the Employee in the manner provided herein.
      In
      the event that the Employee receives disability insurance benefits paid for
      by
      the Company during any period prior to termination of this Employment Agreement
      pursuant to this Section 6f, the Employee’s salary shall be reduced by an amount
      equal to such disability insurance benefits during such period.

    

    g. In
      the
      event this Agreement is terminated by Employer without cause, or by Employee
      with cause, all stock, warrants and options of Employee in the Company shall
      immediately become vested. Stock options may be exercised any time over the
      time
      period as originally set forth at their issuance.

    

    

    7. Confidentiality.

    

    a. Employee
      acknowledges that the Company’s business and future success depends on the
      preservation of the trade secrets and other confidential information of the
      Company and its affiliates, suppliers and customers (the “Secrets”). The Secrets
      include existing, to-be-developed or acquired products, processes, techniques,
      methods, computer programs, know-how, trade secrets, customers, suppliers,
      developments, patents, equipment, or business information made, sold, used,
      developed or practiced by the Company in its business or proprietary to the
      Company or its affiliates, suppliers or customers. “Secrets” do not include any
      of the above information or medium generally known to the industry or which
      comes to the attention of Employee through sources other than the Company.
      It is
      anticipated that all Employees of the Company, including Employee, will mark
      all
      items containing Secrets with prominent confidentiality notices in accordance
      with policies to be adopted by the Company. Employee agrees to protect and
      to
      preserve as confidential during and after the term of his employment all of
      the
      Secrets at any time known to Employee or in his possession or control (whether
      wholly or partially developed by Employee or provided to Employee, and whether
      embodied in a tangible medium or merely remembered).

    

    b. Employee
      shall neither use nor intentionally allow any other person to use any of the
      Secrets in any way, except for the benefit of the Company. All tangible items
      embodying or disclosing any portion of the Secrets shall be and remain the
      property of the Company and shall be returned to the Company upon the
      termination of Employee’s employment. At such time, Employee shall also assemble
      all tangible items of work in progress, notes, plans, and other materials
      related in any way to Employee’s employment, and will promptly deliver such
      items to the Company. The failure to mark any item with confidentiality
      notice(s) shall not, ipso
      facto,
      cause
      such item to be excluded from classification as a Secret for purposes of this
      Section 7.

    

    c. Employee’s
      covenants in this Paragraph shall supplement, and shall not supplant, any other
      rights or remedies the Company may have under applicable law for the protection
      of its properties and trade secrets.

    

    

    8. Inventions.

    

    a. “Invention(s)”
      shall mean discoveries, designs, programs, improvements, developments, new
      concepts, methods, agents, materials, and ideas, whether patentable or not,
      and
      products, processes and know-how related to the use of production
      thereof.

    

    b. Employee
      agrees that any Invention which Employee has made or may make during the term
      of
      this Agreement shall be treated as part of the Company Secrets and shall be
      the
      sole and exclusive property of the Company, whether or not (i) patent
      applications or copyright registrations are filed thereon, (ii) the Invention
      is
      conceived or developed by Employee individually or jointly with others. However,
      Employee has no obligation to assign to the Company any Invention for which
      no
      Company Secrets and no equipment, supplies, or facilities of the Company were
      used and which was developed entirely on Employee’s own time,
      unless:

    

    (i) the
      Invention relates directly to the business of the Company,

    

    (ii) the
      Invention relates to actual or demonstrably anticipated research or

    development
      work of the Company, or

    

    (iii) the
      Invention directly results from any work performed by Employee

    for
      the
      Company.

    

    c. Whenever
      requested by the Company, Employee agrees to assist and cooperate with the
      Company, at the Company’s expense, in the obtaining, maintaining and enforcing
      of the United States and foreign patents and copyright registrations for any
      Invention which is to be the property of the Company as provided above. This
      assistance and cooperation shall include, but is not limited to:

    

    (i) making
      application for United States and foreign patents or copyright

    registrations
      on any Invention if so requested by the Company;

    

    (ii) assigning
      all of Employee’s right, title and interest in and to such 

    Invention
      and any patent applications or copyright registrations thereon

    to
      the
      Company or its designees; and

    

    (iii) executing
      all documents and rendering all assistance as may be reasonably

    necessary
      to protect the rights of the Company or its designee and to vest 

    in
      the
      Company or its designees, all rights to any such Invention, patent

    application,
      patent, copyright, or copyright registration.

    

    d. Attached
      hereto as Exhibit A is a list of all issued patents, pending patent
      applications, registered copyrights, and other inventions which Employee has
      owned or has developed prior to being retained by the Company. Any copyright,
      patent, pending application, or prospective patent application thus listed
      and
      not otherwise expressly assigned in writing by Employee to the Company will
      be
      excluded from the terms of this Agreement.

    

    

    9. Property.
      Upon
      termination of the Term of Employment or termination pursuant to Section 6
      hereof, the Employee or his personal representative shall promptly deliver
      to
      the Company all books, memoranda, plans, records and written data of every
      kind
      relating to the business and affairs of the Company and all other property
      owned
      by the Company which is then in the Employee’s possession.

    

    

    10. Insurance.
      The
      Company shall have the right, at its own cost and expense, to apply for and
      to
      secure in its own name, or otherwise, life, health or accident insurance or
      any
      or all of them covering the Employee, and the Employee agrees to submit to
      usual
      and customary medical examinations and otherwise to cooperate with the Company
      in connection with the procurement of any such insurance, and any claims
      thereunder.

    

    

    11. Covenant
      Not to Compete.

    

    a. Applicability.
      This
      Paragraph 11 shall apply following the termination of Employee’s employment only
      in the event such termination is (i) by Employer for cause as defined in
      Paragraph 6a above, or (ii) by Employee without cause as defined in Paragraph
      6c
      above.

    

    b. Covenant.
      For a
      period beginning on the date of the Agreement and ending one year following
      the
      date of termination of Employee’s employment, Employee hereby agrees that he
      will not, directly or indirectly, enter into the employment, or render services
      to or acquire an interest whatsoever in (whether for his own account as an
      individual proprietor, or as a partner, associate, shareholder, officer,
      director, employee, trustee or otherwise), any person or entity engaged in
      any
      operations in competition in any area of the world with any aspect of the
      business of the Company as presently conducted and as said business may evolve
      in the ordinary course of business between the date of this Agreement and the
      termination of Employee’s employment hereunder (including products under active
      development at such time); provided,
      however,
      that
      nothing herein shall prevent the purchase or ownership by Employee of shares
      of
      stock by way of investment in any corporation or prevent the employment of
      or
      the rendering of services by Employee, including being on boards of directors
      of
      companies, where he does not contribute to the development or sale of products
      which compete with products of the Company with whose development or sale the
      Employee was directly involved. Without limiting the foregoing, Employee agrees
      that he will not call on or otherwise solicit business from any of the customers
      or potential customers of the Company which, at the time of termination of
      his
      employment, were listed (or ought to have been listed) in the Company’s records,
      as to any product that competes with any product provided or marketed by or
      actually under development by the Company at the time of Employee’s termination.
      Employee agrees that he will, during the term of his employment with the
      Company, promptly and fully disclose to the Company any business opportunity
      coming to Employee’s attention, or conceived or developed in whole or in part by
      Employee, which relates to the Company’s business or demonstrably anticipated
      business. Employee will not at any time exploit such business opportunities
      for
      his own gain or that of any person or entity other than the
      Company.

    

    

    12. Remedies.
      Employee acknowledges that damages for breach of his covenants under Paragraphs
      7, 8, 9, 10 and 11 above will be difficult to determine and inadequate to remedy
      the harm which may be caused thereby, and therefore agrees that the Company
      may
      petition or seek to enjoin a putative violation by temporary or permanent
      injunction. Any available injunctive relief shall be in addition to, and not
      in
      place of, any other remedies available at law or equity. Employee believes
      that
      the provisions of this Agreement are reasonable and that Employee is capable
      of
      gainful employment without breaching this Agreement. However, should any court
      or tribunal decline to enforce any provision of Paragraphs 7 or 11 of this
      Agreement as written, the parties hereby agree that this Agreement shall, to
      the
      extent applicable to that circumstance before such court, be deemed to be
      modified to restrict Employee’s competition with the Company to the maximum
      extent to time, scope and geography which the court shall find enforceable,
      and
      such provisions shall be so enforced.

    

    

    13. Entire
      Agreement: Modification.
      The
      provisions contained herein constitute the entire Agreement between the parties
      with respect to the subject matter hereof and any waiver, alteration or
      modification of any provisions of this Agreement, or the replacement of this
      Agreement, shall not be valid unless in writing and signed by all the parties
      signing hereunder.

    

    

    14. Governing
      Law.
      This
      Agreement shall be governed and construed in accordance with the laws of the
      State of Illinois.

    

    

    15. Agreement
      Not Assignable.
      Employee may not assign any of his rights or delegate any of his duties
      hereunder. Subject to Paragraph 6c, the Company may assign this Agreement to
      any
      of its Affiliates at any time owned by, owning or under common ownership of
      the
      Company. In the event of such an assignment by the Company, such affiliates
      shall be deemed substituted for the Company at each place where “the Company”
appears herein; provided, however, the Company shall not be released from its
      obligations hereunder. Furthermore, the assignment of this Agreement by the
      Company shall not enlarge the business activities considered to be conducted
      by
      the Company for purposes of Paragraphs 7, 8 and 11 hereof. Subject to the
      foregoing, this Agreement shall bind parties and their respective heirs,
      successors, assigns and personal representatives.

    

    

    16. Change
      in Ownership.
      Upon
      (a) the sale or transfer of all or substantially all of the assets of the
      Company or of more than fifty percent (50%) of the outstanding stock of any
      voting class of the Company’s stock to any single person or entity (in any one
      or more of a series of related transactions), or (b) the merger of the Company
      with or into any other entity (except a wholly-owned subsidiary or a parent
      owning all of the outstanding stock of the Company), if the Employee maintains
      employment status, then: 1) all terms of the Employment Agreement remain in
      effect, and 2) all stock and options of Employee in the Company shall
      immediately become vested. If the Employee does not
      maintain
      employment status, then: 1) Section 6b of the Employment Agreement, termination
      by the Company without cause, will apply.

    

    

    17. Attorney’s
      Fees.
      In any
      action to enforce its rights hereunder, the prevailing party shall be reimbursed
      by the other for its costs of enforcement, including without limitation,
      reasonable attorney’s fees.

    

    

    18. Jurisdiction
      and Venue.
      The
      parties each irrevocably consent and submit to the personal jurisdiction of
      the
      State and Federal courts sitting in Chicago, Illinois and agrees that any
      action, suit or proceeding in connection with this Agreement shall be brought
      in
      such courts to the exclusion of all other courts, other than actions to enforce
      judgments or orders entered in such courts sitting in Lake County,
      Illinois.

    

    

    19. Notices.
      All
      notices required or permitted hereunder shall be given in writing and delivered
      in person, transmitted by facsimile, or sent by registered or certified mail,
      postage prepaid, or reliable courier service to the parties at the respective
      addresses set forth on the signature page hereof, or such other address as
      a
      party may specify by notice for all subsequent notices to it hereunder. Notices
      will be effective upon the earlier of receipt or the second business day after
      mailing.

    

    

    20. No
      Waiver.
      No
      waiver or modification of any of the terms or provisions hereof shall be valid
      unless in writing signed by the party against which the enforcement of such
      waiver or modification is sought, not shall any waiver or failure to enforce
      any
      right hereunder be deemed to be a waiver of the same or any other right in
      any
      other instance.

    

    

    AGREED:

    

    

    /s/
      Bruce N.
      Barron                                    

    Bruce
      N.
      Barron

    

    

    

    /s/
      John F.
      DeBernardis                                
    

    John
      F.
      DeBernardis, President & CEOBarron Letter Agreement

    
      EXHIBIT
        10.27
[Missing Graphic Reference]

                                    

                                                                      50
        Lakeview Pkwy.,
        Ste. 111

                                                                      Vernon
        Hills, IL
        60061

                                                                      847-573-8025,
        Ext.
        240

                                                                      847-573-8030
        (FAX)

                                                                      hoffing@appns.com

    

    

    Ellen
      R. Hoffing

    President
      & CEO

    

    

    January
      25, 2007

    

    

    

    Mr.
      Bruce
      Barron

    

    
      	
              Re:

            	
              Applied
                NeuroSolutions, Inc.

            

    

    

    Dear
      Mr.
      Barron:

    

    On
      behalf
      of Applied NeuroSolutions, Inc. (the “Company”), I am confirming the
      understanding between you and the Company regarding certain payments made to
      you
      in connection with your Employment Agreement, dated January 1, 2005, prior
      to
      and after your resignation as Chairman of the Board of Directors of the Company
      on June 26, 2006. The Company acknowledges that in June 2006, the Company
      reduced its monthly payment to you to $2,479.74 (“Monthly Payment”). The Company
      has since made 6 Monthly Payments, which amount represented your contribution
      for (i) coverage of you and your family under the Company’s group health
      insurance plan and (ii) your monthly contribution to the Company’s 401(k) plan
      (the Monthly Payment was grossed up to cover the employment taxes required
      to be
      withheld). You hereby acknowledge and agree that the Monthly Payment and
      benefits ceased on January 1, 2007. In the event that the Company secures
      additional funding of at least $2.0 million during its 2007 fiscal year, the
      Company will pay you six (6) Monthly Payments, for a total of $14,878.44 in
      additional Monthly Payments. Further we understand based on your increasing
      external business commitments you have decided not to seek re-election to the
      Applied NeuroSolutions, Inc. Board of Directors at the next annual meeting.
      It
      is also agreed that immediately after the Company’s next annual meeting of
      stockholders, all of your incentive stock options will be converted to
      non-qualified stock options, with all other provisions remaining the same
      (including exercise price, vesting and term of the option).

    

    Very
      truly yours,

    

    APPLIED
      NEUROSOLUTIONS, INC. 

    

    

    By:
      /s/
      Ellen Hoffing

    Ellen
      R.
      Hoffing

    President
      and CEO

    

    Acknowledged
      and agreed:

    

    

    /s/Bruce
      N. Barron 

    Bruce
      N.
      Barron

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