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Exhibit 99.3
TERMINATION, SETTLEMENT AND RELEASE AGREEMENT
This Termination, Settlement and Release Agreement (the
"Termination
Agreement") is made this 31st day of October, 2004 ("Effective
Date"), by and
between PharmaFrontiers Corp., a Texas corporation (the
"Company" or "Pharma"),
and R. Wayne Fritzsche ("Fritzsche").
R E C I T A L S
WHEREAS, Fritzsche is engaged as the Vice President of
Corporate
Development under that certain Employment Agreement between
Fritzsche and the
Company (the "Employment Agreement");
WHEREAS, Fritzsche is a member of the Scientific Advisory Board
of the
Company;
WHEREAS, the Company and Fritzsche desire to terminate the
Employment
Agreement and, in connection with such termination, as of the
Effective Date,
Fritzsche agrees to settle any claims that he may have with the
Company and
release the Company and Pharma from any liability he may
claim;
WHEREAS, the Company has agreed to repurchase from Fritzsche
certain of
shares of Company Securities (as defined below), as provided in
this Termination
Agreement, in full and complete satisfaction of any compensation
which Fritzsche
may be entitled to as contemplated by the Employment Agreement
or any other
verbal agreement with the Company;
WHEREAS, upon the Effective Date, Fritzsche agrees to resign
from his
positions as Vice President of Corporate Development and member
of the
Scientific Advisory Board of the Company;
NOW, THEREFORE, in consideration of the execution, delivery
and
performance of this Termination Agreement, and for other good
and valuable
consideration, the parties hereto intending to be legally bound,
mutually agree
as follows:
1. CAPITALIZED TERMS. Unless otherwise defined herein,
capitalized
terms shall have the meanings set forth in the Employment
Agreement which was
signed by Fritzsche on April 28, 2004.
2. CONTINUED OBLIGATIONS, TERMINATION, RESIGNATION AND
PAYMENT.
(A) TERMINATION OF EMPLOYMENT AGREEMENT. As of the Effective
Date, the parties hereby terminate the Employment Agreement and
the
Company hereby releases Fritzsche from any and all further
obligations
arising under the Employment Agreement; provided, however,
that
Fritzsche shall continue to be bound by the Confidential and
Proprietary Information, Inventions and Other Intellectual
Property
provisions and any other provision that by its terms survive
the
expiration of the Employment Agreement, except the
Noncompetition/No-Hire provision.
<PAGE>
(B) RESIGNATION. Fritzsche hereby resigns his position as
Vice
President of Corporate Development and member of the
Scientific
Advisory of the Company effective as of the Effective Date.
(C) PAYMENT BY THE COMPANY. The Company agrees to repurchase
from Fritzsche 400,000 of Fritzsche's options to purchase
Company
common stock ("Company Securities") for $37,500 upon the closing
of the
sale of securities resulting in gross proceeds of at least $5
million
in one or a series of equity or debt financings by the
Company
commencing after July 1, 2004 ("Financings"), which Financings
include
the Company's exchangeable, convertible, subordinated notes.
Fritzsche
agrees that the Company Securities owned by Fritzsche are free
and
clear of any liens, pledges, restrictions or security
interests.
3. WAIVER AND RELEASE.
(A) WAIVER AND RELEASE BY FRITZSCHE. Fritzsche hereby waives
any and all claims, charges, complaints, liabilities,
obligations,
promises, agreements, contracts, damages, actions, causes of
action,
suits, accrued benefits or other liabilities of any kind or
character,
whether known or hereafter discovered (the "Claims"), arising
in
connection with or otherwise relating to the Employment
Agreement, his
relationship with the Company and his termination therefrom or
his
resignation as Vice President of Business Development and member
of the
Scientific Advisory Board of the Company, that he has or may
have
against the Company, and its officers, directors, shareholders,
agents
and employees and its successors and assigns, and all other
persons,
firms, partnerships, or corporations in control of, under the
direction
of, or in any way presently or formerly associated with the
Company
(the "Released Parties") of any kind whatsoever, including, but
not
limited to, allegations of wrongful termination, breach of
contract
(other than in connection with this Termination Agreement),
intentional
infliction of emotional distress, negligent infliction of
emotional
distress, defamation, invasion of privacy, any action in tort
or
contract (including any action under the Company's charter
documents),
any claims arising under and/or for any alleged violation of
any
federal, state, or local law (including, but not limited to,
Title VII
of the Civil Rights Act of 1964, as amended, 42 U.S.C. ss. 2000e
et
seq., the Civil Rights Act of 1866, 42 U.S.C. ss. 1981 et seq.,
the
Equal Pay Act, 29 U.S.C. ss. 206; the Employee Retirement
Income
Security Act of 1974, as amended ("ERISA") 29 U.S.C. ss. 1001 et
seq.
(non-vested rights), the Americans with Disabilities Act, 42
U.S.C. ss.
12101 et seq., the Age Discrimination Employment Act of 1967,
as
amended ("ADEA"), 29 U.S.C. ss. 621 et seq., the Fair Labor
Standards
Act, as amended, 29 U.S.C. ss. 201 et seq., the Nationa
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