National Vice President Business Development Employment Agreement - Michael Seethaler

EXHIBIT 10.11


EMPLOYMENT AGREEMENT


THIS AGREEMENT is made as of December 22, 2003 by and between Health Fitness Corporation, a Minnesota corporation, (hereinafter called "HFC"), and Mike Seethaler (hereinafter called "Executive").


RECITALS


WHEREAS, Executive desires to be employed by HFC and HFC desires to employ Executive on the terms stated in this Agreement;


WHEREAS, Executive acknowledges that he has been notified and recognizes that the execution of this Agreement, including specifically the restrictive covenants contained in Article IV of this Agreement, is an express condition of his employment with HFC;


NOW, THEREFORE, in consideration of HFC hiring Executive and the continuation of his employment, any promotions, increases in compensation, and/or other benefits now or hereafter paid or made available to Executive by HFC, Executive and HFC agree as follows:


ARTICLE I


EMPLOYMENT, COMPENSATION AND BENEFITS


1.01 Employment With HFC.


(a) HFC hereby agrees to employ Executive initially in the position
of National Vice President Business Development, and Executive
hereby accepts such employment with HFC. Such employment shall
continue indefinitely until terminated in accordance with Article II
of this Agreement.


1.02 Duties.


(a) Executive agrees, during Executive's employment, to devote
Executive's full time and best efforts to the business of HFC,
including, without limitation, the performance of those duties and
responsibilities reasonably and customarily associated with
Executive's position such as, but not limited to, those duties and
responsibilities associated with increasing HFC's revenue.
Executive's duties and responsibilities shall be subject to
determination by HFC's Chief Executive Officer or his designee.


(b) Executive shall report to, and at all times shall be subject to
the direction of, HFC's Chief Executive Officer or his designee.


(c) Executive, at all times during Executive's employment with HFC,
shall comply with HFC's reasonable standards, regulations and
policies as determined or set forth by HFC from time to time and as
applicable to employees of HFC.


1.03 Outside Activities. Executive shall not engage in any outside activities that conflict or appear to conflict with HFC's interests, or that interfere in any way with Executive's performance of Executive's duties hereunder. In addition, Executive shall not engage in any activity that might subject HFC to criticism or adverse publicity, that might interfere with Executive's normal work schedule, or that might interfere with Executive's job duties. Moreover, Executive shall not, and hereby agrees not to accept remuneration of any kind from Executive's participation in any outside activity without the express written approval of HFC.


1.04 Annual Base Salary. Executive's annual base salary shall be calculated on the gross amount of U.S. $120,000 per year, less withholding for income and FICA taxes and any other proper deductions. Executive's annual base salary will be paid to Executive in accordance with HFC's normal payroll practices. Executive's performance shall be reviewed annually for base salary increase beginning March 2005, and such increase, if any, shall be determined by HFC in its sole discretion.


1.05 Stock Options. Executive and HFC shall enter into a separate Incentive Stock Option Agreement ("ISOA") pursuant to which HFC will grant to Executive, upon Executive's first day of employment with HFC hereunder, options to purchase 40,000 shares of common stock of HFC. Under the ISOA, such options will vest 25% on each of the first four anniversaries of Executive's date of employment subject to continued employment, will expire on the sixth anniversary of the date of grant, and will have an exercise price of fair market value of HFC's common stock on the date of grant (first day of Executive's employment). The full terms and conditions of the stock option will be set forth in the ISOA and such ISOA shall also set forth provisions regarding the termination of such options following the termination of Executive's employment for any reason.


1.06 Fringe Benefits. HFC shall provide the following fringe benefits to Executive so long as Executive is employed by HFC:


(a) Executive shall be eligible to participate in an annual calendar
year bonus program effective with the 2004 calendar year subject to
the specific terms and conditions of the program developed each
year. Initially for the 2004 calendar year such bonus eligibility
shall be up to a maximum of $30,000 based on the Executive's
successful achievement of criteria to be determined by HFC's Chief
Executive Officer in his sole discretion.


(b) Executive shall be eligible to participate in employee benefit
plans and programs offered by HFC from time to time, including, but
not limited to, any medical, dental, short-term disability,
long-term disability and life insurance coverage, or retirement
plans, in accordance with the terms and conditions of those benefit
plans and programs.


(c) Executive shall be eligible to accrue up to 15 days of paid
vacation time per anniversary year in accordance with HFC's standard
vacation practices and policies. In


addition, Executive may be eligible for additional paid time off in
accordance with HFC's standard paid time off practices and policies.


(d) Executive shall be paid a lump sum $10,000 bonus, less
withholding for income and FICA taxes and any other proper
deductions. Such bonus will be paid within one month following
Executive's first day of employment with HFC and is intended to help
compensate Executive for prior relocation expenses. Should Executive
voluntarily resign his employment with HFC, the Executive shall be
required to pay back to HFC the bonus as follows: Executive's
resignation prior to one year of employment, $10,000 bonus to be
paid back; Executive's resignation on or after one year of
employment but prior to two years, $5,000 bonus to be paid back;
Executive's resignation at or after 2 years of employment, $0 bonus
to be paid back to HFC.


1.07 Expenses. During the term of this Agreement, Executive shall be entitled to prompt reimbursement by HFC for all reasonable, ordinary and necessary travel, entertainment and other business related expenses incurred by Executive (in accordance with the policies and procedures established by HFC for employees from time to time) in the performance of Executive's duties and responsibilities under this Agreement; provided, however, that Executive shall properly account for such expenses in accordance with federal, state and local tax requirements and HFC's policies and procedures.


ARTICLE II


TERMINATION


2.01 Events of Termination. Executive's employment with HFC:


(a) May be terminated by mutual written agreement of HFC and
Executive.


(b) Shall terminate immediately upon the death of Executive.


(c) May be terminated upon written notice from HFC to Executive for
Cause, which shall mean the following:


(i) Failure of Executive to (a) satisfactorily,
faithfully, diligently or competently perform the duties,
requirements and responsibilities of Executive's employment as
contemplated by this Agreement or as assigned by HFC's Chief
Executive Officer, or (b) take reasonable direction consistent
with Executive's position from HFC's Chief Executive Officer;
or


(ii) Failure of Executive to comply with the reasonable
policies, regulations and directives of HFC as in effect from
time to time; or


(iii) Any act or omission on the part of Executive which
constitutes a failure to comply with the provisions of this
Agreement; or


(iv) Any act or omission on the part of Executive which
is harmful to the reputation or business of HFC, including,
but not limited to, personal conduct of Executive which is
inconsistent with federal and state laws respecting harassment
of, or discrimination against, one or more of HFC's employees;
or


(v) Conviction of Executive of, or a guilty or nolo
contendere plea by Executive with respect to, any crime
punishable as a felony; or any bar against Executive from
serving as a director, officer or executive of any firm the
securities of which trade publicly.


Executive's termination for Cause shall be determined in good
faith by and in the sole discretion of HFC's Chief Executive Officer
and/or his designee.


In the event of termination pursuant to subparagraph
2.01(c)(iii), (iv) or (v), Executive's termination shall be
immediate upon the giving of written notice to Executive. However,
in the event of termination pursuant to subparagraph 2.01(c)(i) or
(ii), HFC's Chief Executive Officer will provide Executive written
notice (the "Cause Notice") of proposed termination which provides
(1) reasonable detail as to the cause or causes asserted by HFC and
upon which the Cause Notice is based, and (2) notification of a
certain period of time from receipt of such Cause Notice within
which Executive shall have the opportunity to cure the performance
or conduct upon which the Cause Notice is based, to the satisfaction
of HFC's Chief Executive Officer. If after the completion of the
designated cure period HFC's Chief Executive Officer determines, in
his sole discretion, that Executive has failed to cure the
performance or conduct, Executive will be given written notice of
Executive's termination and Executive's employment will terminate
immediately upon the giving of such notice to Executive.


(d) May be terminated upon Executive's inability to perform the
essential functions of Executive's position due to physical or
mental disability, with or without reasonable accommodation, as
determined in the good faith judgment of HFC's Chief Executive
Officer, or as may otherwise be required by applicable law.


(e) Shall terminate at the end of the month during which Executive
reaches the normal retirement date established by HFC for management
employees of HFC, but in no event earlier than the compulsory
retirement age permitted under applicable federal or state law for
management employees.


(f) May be terminated by Executive for any reason on thirty (30)
days' written notice to HFC.


(g) May be terminated by HFC at any time, for any reason, upon
written notice to Executive.


2.02 Compensation Upon Termination of Executive's Employment. In the event that Executive's employment with HFC terminates the following provisions shall govern as applicable:


(a) If termination occurs pursuant to subparagraph 2.01(a), (b),
(c), (d), (e), or (f), Executive's receipt of annual base salary and
fringe benefits shall terminate as of the date of termination or as
required by law, unless the parties agree in writing otherwise. If
termination occurs pursuant to subparagraph 2.01(d), Executive
acknowledges and agrees that Executive's receipt of salary
compensation between the date of disability and date of t ...