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EXHIBIT 10.24
AMENDED EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "AGREEMENT") is made and
entered effective as of January 1, 2000, as amended March 7, 2000, between
METROPOLITAN HEALTH NETWORKS, INC., a Florida corporation, (the "Company"),
whose principal place of business is ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ #▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇, ▇▇▇▇▇, and ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ an individual (the "EXECUTIVE"), whose
address is ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
RECITALS:
A. The Company is a healthcare provider of services as a PPM and MSO and
the Company is interested in being an Internet-Based Critical Solutions
and Service Provider to Healthcare Companies (the "Business").
B. The Executive has extensive experience in the Business and the Company
wishes to employ Executive.
NOW, THEREFORE, in consideration of the mutual agreements herein made,
the Company and the Executive hereby agree as follows:
1. EMPLOYMENT. The Company hereby employs Executive in as
President and Chief Executive Officer, and Executive hereby accepts such
employment, upon the terms and conditions hereinafter set forth. During the
"Term" (including any renewals thereof) as defined herein Executive shall have
such duties and responsibilities commensurate with said position.
2. COMPENSATION/BENEFITS.
a. SALARY. Company shall pay Executive a base salary (the
"Base Salary"), One Hundred and Fifty Thousand ($150,000.00) Dollars for the
first year, plus annual increases of ten (10%) percent per year of the prior
year base salary inclusive of annual increases on April of each year. Said
salary shall be paid consistent with the Company's payroll policies and
procedures for all employees.
b. PERFORMANCE BONUS. Executive may receive an annual bonus
("Bonus") at the discretion of the Board of Directors.
c. EMPLOYEE BENEFITS. The Executive shall be entitled to
participate in all benefit programs of the Company currently existing or
hereafter made available to executives and/or other executive employees,
including, but not limited to, pension and other retirement plans, including any
401K Plan, group life insurance, dental, hospitalization, surgical and major
medical coverage, sick leave, salary continuation, vacation and holidays,
long-term disability and other fringe benefits.
d. INSURANCE/INSURANCE POLICY BENEFITS.
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(i) The Company shall provide dental,
hospitalization, surgical and major medical coverage for the Executive and
Executive's family.
(ii) The Company agrees to obtain at its sole
expense, and for the benefit of the Executive's heirs, term insurance policies
on the Executive in the amount of One Million ($1,000,000.00) Dollars. In the
event of termination, for any reason, the Company shall continue the contract
for the term of the Employment Agreement and then Executive shall be able to
continue to coverage at his own expense.
e. VACATION. During each fiscal year of the Company, the
Executive shall be entitled to four (4) weeks of vacation time to be utilized or
paid for each year, or accrue and carry over into the following year.
f. BUSINESS EXPENSE REIMBURSEMENT. The Executive shall be
provided with Company credit cards, and the Executive shall be entitled to
receive proper reimbursement for all reasonable, out-of-pocket expenses
incurred.
g. AUTOMOBILE AND TELEPHONE EXPENSES.
(i) The Executive shall receive an automobile
allowance of Eight Hundred ($800.00) Dollars per month. The Employee shall be
reimbursed for all reasonable expenses in connection with such automobile
including, but not limited to, maintenance, insurance and gas.
(ii) The Company shall provide the Executive with an
automobile telephone and/or portable cellular telephone and pager.
3. STOCK OPTION. The Executive shall also be granted options to
purchase shares of Common Stock of the Company under the following terms and
conditions:
a. Executive received Three Hundred Thousand (300,000) Options
to purchase the Company's common stock at $0.30(cent) per share upon the signing
of this Agreement.
b. Executive received Three Hundred Sixty Thousand (360,000)
Options at $0.50 per share. The Executive shall receive Seven Hundred Thousand
(700,000) options at $0.75 per share, vesting 100,000 options on April 1, 2001,
150,000 options on October 1, 2001, 150,000 on April 1, 2002, 150,000 options on
October 1, 2002 and 150,000 options on January 1, 2003. Whether or not vested or
earned, shall be deemed earned and become fully vested upon the occurrence of
any one of the following events:
(i) The Company enters into an Asset Purchase
Agreement for the sale of a material portion of its assets or operating
affiliates or subsidiaries; or
(ii) The Company enters into a Merger Agreement
resulting in a change in ownership and/or control in the Company; or
(iii) The Company is otherwise acquired or a change
in control of the Company is otherwise effectuated in a transaction which may
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otherwise be reasonably deemed by an independent party to results in a
constructive termination pursuant to subsections 5(f) or 5(g); or
(iv) Termination of employment by either the Company
or Executive.
c. Executive will receive additional longevity options at the
rate of 25,000 per year of employment at a price of $1.00 per share.
At the request of Executive, the Company shall file a
registration statement for the common stock underlying the options at the same
time it files its annual report on Form 10-K, for all shares earned each year.
The Executive will have the right to sell or transfer earned or vested shares
and options without restrictions.
4. TERM. The Term of employment hereunder will commence February 1,
2000, and end Five (5) years from the Effective Date ("Term"), unless terminated
pursuant to Section 5 of this Agreement.
5. DEATH, DISABILITY AND TERMINATION.
a. DEATH. In the event of the death of the Executive during
the Term or of the Renewal Term of the Agreement, salary shall be paid to the
Executive's designated beneficiary, or, in the absence of such designation, to
the estate or other legal representative of the Executive for a period of one
(1) year from and after the date of death. The Company shall also pay to the
Executive's estate or heirs, as the case may be, any such accrued amount of
Bonus based upon (i) the formula set forth in Section 2(b) of this Agreement for
the fiscal year in which the death of the Executive occurred; (ii) divided by
twelve (12); and (iii) then multiplied the number of completed months the
Executive was employed by the Company just prior to the Executive's death. Other
death benefits will be determined in accordance with the terms of the Company's
benefit programs and plans.
b. DISABILITY.
(i) In the event of the Executive's disability, as
hereinafter defined, the Executive shall be entitled to compensation in
accordance with the Company's disability compensation practice for senior
executives, including any separate arrangement or policy covering the Executive,
but in all events the Executive shall continue to receive the Executive's salary
for a period, at the annual rate in effect immediately prior to the commencement
of disability, of not less than one (1) year from the date on which the
disability has deemed to occur as hereinafter provided below. Any amounts
provided for in this Section 5(b) shall be offset by other long-term disability
benefits provided to the Executive by the Company.
(ii) "Disability" for the purposes of this Agreement,
shall be deemed to have occurred in the event (a) the Executive is unable by
reason of sickness or accident to perform the Executive's duties under this
Agreement for a cumulative total of twelve (12) weeks within any one calendar
year or (b) the Executive is unable to perform Executive's duties for ninety
(90) consecutive days or (c) the Executive has a guardian of the person or
estate appointed by a court of competent jurisdiction. Termination due to
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disability shall be deemed to have occurred upon the first day of the month
following the determination of disability as defined in the preceding sentence.
Anything herein to the contrary notwithstanding; if,
following a termination of employment hereunder due to disability as provided in
the preceding paragraph, the Executive becomes reemployed, whether as an
Executive or a consultant, any salary, annual incentive payments or other
benefits earned by the Executive from such employment shall offset any salary
continuation due to the Executive hereunder commencing with the date of
reemployment.
c. TERMINATION BY THE COMPANY FOR CAUSE.
(i) Nothing herein shall prevent the Company from
terminating Employment for "Cause" as hereinafter defined. The Executive shall
continue to receive salary only for the period ending with the date of such
termination as provided in this Section 5(c). Any rights and benefits the
Executive may have in respect of any other compensation shall be determined in
accordance with the terms of such other compensation arrangements or such plans
or programs.
(ii) "Cause" shall mean (a) committing or
participating in an injurious act of fraud, gross neglect, misrepresentation,
embezzlement or dishonesty against the Company; or otherwise (b) committing or
participating in any other injurious act or omission wantonly, willfully,
recklessly or in a manner which was grossly negligent against the Company,
monetarily.
(iii) Notwithstanding anything else contained in this
Agreement, this Agreement will not be deemed to have been terminated for Cause
unless and until there shall have been delivered to the Executive a notice of
termination stating that the Executive committed one of the types of conduct set
forth in this Section 5(c) contained in this Agreement and specifying the
particulars thereof and the Executive shall be given a thirty (30) day period to
cure such conduct set forth in Section 5(c).
d. TERMINATION BY THE COMPANY OTHER THAN FOR CAUSE.
(i) The foregoing notwithstanding, the Company may
terminate the Executive's employment for whatever reason it deems appropriate;
provided, however, that in the event such termination is not based on Cause, as
provided in Section 5(c) above, or if Executive's employment is terminated under
Sections 5(f) or 5(g) hereto the Company shall continue to be obligated to pay
to Executive his Salary and current and future Bonuses and Executive shall be
entitled to all Stock Options earned or not yet earned through the full term of
this Agreement and Company will register all shares owned by the Executive, his
family, and companies controlled by the Executive or his family as well as all
option shares at Company expense.
(ii) In the event that the Executive's employment
with the Company is terminated pursuant to this Section 5(d), Section 5(f) or
Section 5(g), then Section 6 of this Agreement and all references thereto shall
be inapplicable as to the Executive and the Company.
e. VOLUNTARY TERMINATION. In the event the Executive
terminates the Executive's employment on the Executive's own volition (except as
provided in Section 5(f) and/or Section 5(g)) prior to the expiration of the
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Term or Renewal Term of this Agreement, including any renewals thereof, such
termination shall constitute a voluntary termination and in such event the
Executive shall be limited to the same rights and benefits as provided in
connection with Section 5(a).
f. CONSTRUCTIVE TERMINATION OF EMPLOYMENT. A termination by
the Company without Cause under Section 5(d) shall be deemed to have occurred
upon the occurrence of one or more of the following events without the express
written consent of the Executive:
(i) a significant change in the nature or scope of
the authorities, powers, function duties or responsibilities attached to
Executive's as described in Section 1; or
(ii) a change in Executive's principal office to a
location outside the Palm Beach, and Broward Counties, Florida area, without the
prior written consent of the Executive; or
(iii) a Five Percent (5%) reduction in the
Executive's salary below the salary in effect immediately prior to such
reduction or a reduction in the target bonus participation under Section 5(b) as
a percentage of salary; or
(iv) a material breach of the Agreement by the
Company, or
(v) a material reduction of the Executive's benefits
under any employee benefit plan, program or arrangement (for Executive
individually or as part of a group) of the Company as then in effect or as in
effect on the effective date of the Agreement, which reduction shall not be
effectuated for similarly situated employees of the Company, or
(vi) failure by a successor company to assume the
obligations under the Agreement; or
(vii) if at any time Executive is not a member of the
Board of Directors of the Company without the prior written consent of
Executive; or
Anything herein to the contrary notwithstanding, the
Executive shall give written notice to the Board of Directors of the Company
that the Executive believes an event has occurred which would result in a
Constructive Termination of the Executive's employment under this Section 5(f),
which written notice shall specify the particular act or acts, on the basis of
which the Executive intends to so terminate the Executive's employment, and the
Company shall then be given the opportunity, within fifteen (15) days of its
receipt of such notice to cure said event; provided, however, there shall be no
period permitted to cure a second occurrence of the same event and in no event
will there be a required period to cure following the occurrence of two events
as described in this Section 5(f).
g. TERMINATION FOLLOWING A CHANGE OF CONTROL AND COMPENSATION
REDUCTION.
(i) In the event that a "Change in Control," as
hereinafter defined, of the Company shall occur at any time during the Term or
Renewal Term hereof, the Executive shall have the right to terminate the
Executive's employment under this Agreement upon thirty (30) days written notice
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given at any time within one (1) year after the occurrence of such event and
such termination of the Executive's employment with the Company pursuant to this
Section 5(g)(i), then, in any such event such termination shall be deemed to be
a Termination by the Company Other than for Cause and the Executive shall be
entitled to such Compensation and Benefits as set forth in Subsection 5(d) of
this Agreement.
(ii) For purposes of this Agreement, a "Change in
Control"' of the Company shall mean a change in control (a) as set forth in
Section 28OG of the Internal Revenue Code or (b) of a nature that would be
required to be reported in response to Item I of the current report on Form 8K,
as in effect on the date hereof. pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 (the Exchange Act").
6. COVENANT NOT TO COMPETE. Executive acknowledges and recognizes the
highly competitive nature of Company's Business and the goodwill and business
strategy of the Company, continued patronage constitute a substantial asset of
the Company. Executive further acknowledges and recognizes that during the
course of the Executive's employment Executive will receive specific knowledge
of Company's Business, access to trade secrets and Confidential Information, as
defined in Section 7, participate in business acquisitions corporation and
decisions, and that it would be impossible for Executive to work for a
competitor without using and divulging this valuable confidential information.
That Executive acknowledges that Company is without an adequate remedy at law in
the event this covenant is violated. Executive farther acknowledges that this
covenant not to compete is an independent covenant within this Agreement. This
covenant shall survive this Agreement and shall be treated as an independent
covenant for the purposes of enforcement; provided, however, that the provisions
of this Section 6 shall not apply if Executive's employment is terminated
without cause as provided in Section 5(c) above, or if Executive's employment is
terminated under Sections 5(f) or 5(g) hereof The Executive recognizes that the
terms of this covenant are reasonable and necessary for the protection of the
Company's business because the value of Executive's services will be enhanced by
his association with Company. Accordingly, Executive agrees to the following:
a. that for a period of Twelve (12) months after termination
of the Executives employment under this Agreement or any renewal or extension
thereof (the Restricted Period'), for whatever reason and anywhere within Dade,
Broward, Palm Beach, Treasure Coast, and Daytona Beach County (the "Restricted
Area"), Executive will not individually or in conjunction with others, directly
engage in any Business Activities other than on behalf of the Company and as
agreed by the Company and Executive, whether as an officer, director,
proprietor, employer, employee, partner independent contractor, investor (other
than as a holder of less than Ten (10%) of the outstanding capital stock of a
publicly traded corporation), consultant, advisor, agent or otherwise.
b. that during the Restricted Period and within the Restricted
Area, Executive will not, indirectly or directly, compete with the Company by
soliciting, inducing or influencing any of the Company's Doctor which have a
business relationship with the Company at any time during the Restricted Period
to discontinue or reduce the extent of such relationship with the Company.
c. That during the Restricted Period and within the Restricted
Area, Executive will not (a) directly or indirectly recruit or solicit any
employee or agent of the Company to discontinue such employment or agency
relationship with the Company, or (b) employ or seek to employ, or cause to
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permit any business which competes directly or indirectly with the Business of
the Company (the "Competitive Business") to employ or seek to employ for any
Competitive Business any person who is then (or was at any time within six (6)
months prior to the date Executive or the Competitive Business employs of seeks
to employ such person) employed by the Company.
d. That during the Restricted Period, Executive will not
interfere with, disrupt attempt to disrupt any past, present or prospective
relationship contractual or otherwise, between the Company and any Company's
Doctors, Employees or Agents.
e. The provision of paragraph 6 will not be in effect for any
corporation or partnership Employer is a direct or indirect shareholder interest
holder, and/or has entered into any kind of joint venture relationship or
partnership with the Company.
7. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION.
a. Executive acknowledges that the Company's trade secrets,
private or secret processes, methods and ideas, as they exist from time to time,
patient fists and information concerning the Company's services, business
records and plans, inventions, acquisition strategy, price structure and
pricing, discounts, costs, computer programs and listings, source code and/or
subject code, copyright trademark proprietary information, formulae, protocols,
forms, procedures, training methods, development technical information,
know-how, show-how, new product and service development, advertising budgets,
past, present and future marketing, activities and procedures, method for
operating the Company's Business, credit and financial data concerning the
Company's Clients and patient lists, which patient lists shall not only mean one
or more of the names and address of the patients of the Company, but it shall
also encompass any and all information whatsoever regarding them, including
their needs, and marketing; advertising, promotional and sales strategies, sales
presentations, research information, revenues, acquisitions, practices and plans
and information which is embodied in written or otherwise recorded form, and
other information of a confidential nature not known publicly or by other
companies selling to the same markets and specifically including information
which is mental, not physical (collectively, the "Confidential Information") are
valuable, special and unique assets of the Company, access to and knowledge of
which have been provided to Executive by virtue of Executive's association with
the Company. In light of the highly competitive nature of the industry in which
the Company's business is conducted, Executive agrees that all Confidential
Information, heretofore or in the future obtained by Executive as a result of
Executive's association with the Company shall be considered confidential.
b. The Executive agrees that the Executive shall (1) hold in
confidence and not disclose or make available to any third party any such
Confidential Information obtained directly or constructively from the Company,
unless so authorized in writing by the Company; (2) exercise all reasonable
efforts to prevent third parties from gaining access to the Confidential
Information; (3) not use, directly or indirectly. the Confidential information
in order to perform the Executive's duties and responsibilities to the Company;
(4) restrict the disclosure or availability of the Confidential Information to
those who have read and understand this Agreement and who have a need to know
the information in order to achieve the purposes of this Agreement without the
prior consent of the Company; (5) not copy or modify any Confidential
Information without prior written consent of the Company, provided, however,
that such copy or modification of any Confidential Information does not include
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any modifications or copying which would otherwise prevent the Executive from
performing his/her duties and responsibilities to the Company; (6) take such
other protective measures as may be reasonably necessary to preserve the
confidentiality of the Confidential Information; and (7) relinquish and require
all of its employees to relinquish all rights it may have in any matter, such as
drawings, documents, models, samples, photographs, patterns, templates, molds,
tools or prototypes, which may contain, embody or make use of the Confidential
Information; promptly delivery to the Company any such matter as the Company may
direct at any time, and not retain any copies or other reproductions thereof
c. Executive further agrees (1) that Executive shall promptly
disclose in writing to the Company all ideas, inventions, improvements and
discoveries which may be conceived, made or acquired by Executive as the direct
or indirect result of the disclosure by the Company of the Confidential
Information to Executive; (2) that all such ideas, inventions, improvements and
discoveries conceived, made or acquired by Executive, alone or with the
assistance of others, relating to the Confidential Information in accordance
with the provisions hereof and that Executive shall not acquire any intellectual
property rights under this Agreement except the limited right to use set forth
in this Agreement; (3) that Executive shall assist in the preparation and
execution of all applications, assignments and other documents which the Company
may deem necessary to obtain patents, copyrights and the like in the United
States and in jurisdictions foreign thereto, and to otherwise protect the
Company.
d. Excluded from the Confidential Information, and therefore
not subject to the provisions of this Agreement, shall be any information which
the Executive can show (1) at the time of disclosure, is in the public domain as
evidenced by printed publications; (2) after the disclosure, enters the public
domain by way of printed publication through no fault of the Executive; (3) by
written documentation was in its possession at the time of disclosure and which
was not acquired directly or indirectly from the Company; or (4) by written
documentation was acquired, after disclosure, from a third party who did not
receive it from the Company, and who had the right to disclose the information
without any obligation to hold such information confidential. The foregoing
exceptions shall apply only from and after the date that the information becomes
generally available to the public or is disclosed to the Executive by a third
party, respectively. Specific information shall not be deemed to be within the
foregoing exceptions merely because it is embraced by more general information
in the public domain. Additionally, any combination of features shall not be
deemed to be within the foregoing exceptions merely because individual features
are in the public domain. If the Executive intends to avail himself/herself of
any of the foregoing exceptions, the Executive shall notify the Company in
writing of his/her intention to do so and the basis for claiming the exception.
e. Upon written request of the Company, Executive shall return
to the Company all written materials containing the Confidential Information.
Executive shall also deliver to the Company written statements signed by
Executive certifying all materials have been returned within five (5) days of
receipt of the request.
8. AMENDMENTS. This Agreement shall not be modified or amended except
by written agreement duly executed by the parties hereto.
9. HEADINGS. All sections and descriptive headings of this Agreement
are inserted for convenience only, and shall not affect the construction or
interpretation hereof.
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10. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which, when executed and delivered, shall be an original,
but all counterparts shall together constitute on e and the same instrument.
11. ENTIRE AGREEMENT. This Agreement hereto constitutes the entire
understanding between the parties. Nothing in this Agreement will prevent or
restrict Executive from serving on the Board of Directors of public or private
companies and receive compensation from such service.
12. GOVERNING LAW. This Agreement is to be construed and enforced
according to the laws of the State of Florida. This Agreement shall not be
construed more strictly against one party than the other, merely by virtue of
the fact that it may have been prepared by counsel for one of the parties, it
being recognized that both Company and Executive have contributed substantially
and materially to the negotiation and preparation of this Agreement.
13. VENUE. Venue in any action arising from this Agreement shall be in
Palm Beach County, Florida.
14. ATTORNEYS' FEES. In connection with any controversy arising out of
this Agreement, the prevailing party shall be entitled to reasonable attorneys'
fees and costs at pretrial, trial, and appellate levels from the non-prevailing
party.
15. SEVERABILITY. Inapplicability or unenforceability of any provision
of this Agreement shall not limit or impair the operation or validity of any
other provision of this Agreement or any such other instrument.
16. NON-ASSIGNABILITY. This Agreement is personal in nature and not
assignable by any party hereto.
17. BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of the parties, its' successors, transferees and assigns.
18. CONSTRUCTION. In construing this Agreement, the singular shall
include the plural and the plural shall include the singular, and the use of any
gender shall include every other and all genders.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written in Palm Beach County, Florida.
CORPORATE SEAL METROPOLITAN HEALTH NETWORKS, INC.
BY:
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▇▇▇▇ ▇▇▇▇▇, DIRECTOR
BY:
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▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, DIRECTOR
BY:
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▇▇▇▇ ▇▇▇▇▇▇, DIRECTOR
EXECUTIVE
BY:
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