THIS AGREEMENT is made 1st day of August, 1997 ("the
Effective Date") by and between INTERNATIONAL MUREX TECHNOLOGIES
CORPORATION, incorporated under the laws of the Province of
British Columbia (the "Company"), and F ▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇
("Executive").
WHEREAS, the Company and Executive previously entered into an
Employment Agreement dated January 1, 1992; and
WHEREAS, the term of the employment relationship created by such
Employment Agreement has not expired; and
WHEREAS, the Company and Executive desire to amend and restate
the terms and conditions of their employment relationship as it
relates to the period subsequent to 1 August, 1997.
NOW THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the Company and the Executive agree
as follows:
1. Employment
----------
The Company hereby employs Executive, and Executive
accepts such employment and agrees to perform services for
the Company, for the period and upon the other terms and
conditions set forth in this Agreement.
2. Term
----
The initial term of Executive's employment hereunder shall
be for a period of three (3) years, commencing as of 1
August 1997 (the "Commencement Date") subject to earlier
termination as hereinafter specified in Section 8. At
each anniversary date of the Commencement Date (each a
"Renewal Date"), the then remaining term of this Agreement
shall be extended for an additional one year period in
addition to the then remaining term unless either party
hereto shall have provided written notice to the other
party of such non-renewal of this Agreement on or within
three (3) months before such Renewal Date. In the event
that either party shall provide the other party with
written notice of non-renewal of this Agreement, this
Agreement shall not be extended as of any subsequent
Renewal Date but shall remain effective in accordance with
its terms (subject to termination in accordance with
Section 8 hereof) until the end of the then current term
of this Agreement. A non-renewal of this Agreement in
accordance with this Section 2 shall not constitute a
termination of this Agreement for the purpose of Sections
5 or 8.
3. Position and Duties
-------------------
3.1 Service with the Company. During the Term of this
Agreement, Executive shall serve in such position as
Executive and the Board of Directors shall from time to
time agree. In such position, Executive agrees to perform
such executive employment duties consistent with such
position as the Board of Directors of the Company shall
assign to him from time to time. Executive also agrees to
serve, during the Term hereof, as requested by the Board,
and without any additional compensation, as a Director of
the Company and as an executive officer and/or director of
any corporations affiliated with the Company. The
compensation payable to Executive herein shall be paid by
the Company or by a subsidiary of the Company as
designated by Executive.
3.2 Performance of Duties. Executive agrees to serve the
Company faithfully and to the best of his ability and to
devote the time, attention and efforts necessary to
advance the business and affairs of the Company during the
Term of this Agreement. It is understood and agreed that
Executive may pursue personal investments requiring time
commitments that do not conflict with his obligations to
the Company, including those in the preceding sentence.
Executive hereby confirms that he is under no contractual
commitments inconsistent with his obligations set forth in
this Agreement, and that during the Term of this
Agreement, he shall not render or perform services, or
enter into any contract to do so, for any other
corporation, firm, entity or person which are inconsistent
with the provisions of this Agreement.
4. Compensation
------------
4.1 Base Salary
-----------
As compensation for all services to be rendered by
Executive under this Agreement, the Company shall pay to
Executive an initial base annual salary (the "Base
Salary") of US$11,912 which salary shall be paid in semi-
monthly instalments in accordance with the Company's
normal payroll procedures and policies. The base salary
shall be increased on January 1, 1998 and on each January
1 thereafter by the percentage equal to the percentage
increase in the Consumer Price Index maintained by the
United States Bureau of Labor Statistics for the Atlanta,
Georgia metropolitan area or an equivalent index (the
"Index") as of January 1 of such year over the Index for
the immediately preceding January 1. Should the Index be
modified or discontinued, appropriate adjustment shall be
made to reflect such modification or to refer to a similar
index. Additionally, Executive's Base Salary shall be
reviewed annually and may be increased by an amount to be
determined by the Compensation/Option Committee (the
"Committee") on the basis of Executive's performance.
4.2 Incentive Compensation
----------------------
In addition to the Base Salary described in Section 4.1,
Executive shall be eligible to receive incentive
compensation pursuant to the Senior Management Incentive
Plan as approved by the Committee or such other plans as
may from time to time be available.
4.3 Deferral of Compensation
------------------------
Executive shall be entitled to elect to defer the receipt
of up to seventy-five percent (75%) of his Base Salary and
Incentive Compensation for each calendar year during which
this Agreement is in effect. Executive shall make the
election to defer his compensation for a calendar year by
giving written notice to the Company of his desire to do
so in writing no later than December 31 of the immediately
preceding calendar year. In the event that Executive
elects to defer the payment of any compensation due
hereunder in the manner contemplated by this Section 4.3,
the terms and conditions set forth in Exhibit A hereto
with respect to the circumstances under which Executive
shall be entitled to the payment of the deferred
compensation as well as the interest earned thereon and
the timing and method of those payments shall be
applicable. Also in such event, each of the periodic
payments of Executive's Base Salary for any year in which
Executive has elected to defer receipt of a portion of his
Base Salary shall be reduced by the percentage amount of
his total Base Salary which he has elected to defer.
4.4 Participation in Benefit Plans
------------------------------
Executive shall also be entitled to the extent that his
position, title, tenure, salary, age, health and other
qualifications make him eligible, to participate in all
employee benefit plans or programs (including
medical/dental and life insurance, retirement pension,
stock option incentives, vacation time, sick leave and
holidays) of the Company currently in existence on the
date hereof or as may hereafter be instituted from time to
time. Executive's participation in any such plan or
program shall be subject to the provisions, rules and
regulations applicable thereto.
4.5 Expenses
--------
In accordance with the Company's policies established from
time to time, the Company shall pay or reimburse Executive
for all reasonable and necessary out-of-pocket expenses
incurred by him in the performance of his duties under
this Agreement, subject to the timely presentment of
appropriate vouchers and receipts.
4.6 Vacation
--------
Executive will be entitled to the highest number of
vacation days with full pay during each twelve months in
which this Agreement is in effect as are available to any
other key United States corporate executive of the
Company, without any reduction based upon length of
service to the Company.
4.7 Double Tax Liability
--------------------
In the event that in any year during the term of this
Agreement Executive is required to pay income taxes on any
portion of his income for that year both to Canada and to
the United Kingdom, the Company shall pay to Executive the
amount which, after taking into account the taxes required
to be paid by Executive as a result of Executive's receipt
of such payment from the Company, shall cause Executive's
after-tax return on his income to equal the amount which
would have been available to Executive had no United
Kingdom taxes been due with respect to such income. The
amounts due from the Company pursuant to the immediately
preceding sentence shall be determined by Executive's tax
return preparer, shall take into account any foreign tax
credits or other credits and deductions allowed against
his Canadian tax liability, and shall be paid to Executive
no later than fifteen days following the date on which
Executive files the first tax return in which the income
subject to taxation in both Canada and the United Kingdom
is reported in any year, or within fifteen days following
the date on which the relevant taxing authority determines
that Executive's income is subject to taxation both in
Canada and in the United Kingdom, as the case may be.
4.8 Tax and Estate Planning
-----------------------
The Company agrees to reimburse Executive for the cost of
financial, tax and estate planning for each 365 day period
in which this Agreement is in effect in amount not to
exceed US$3,000 (net of any tax required to be paid by
Executive on such reimbursement) for each 365 day period.
In the event that Executive is required to pay any tax on
such reimbursement, the amount to be reimbursed to
Executive shall be grossed up by such amount as shall
ensure that Executive receives the same amount as he would
have received had no such tax been payable.
4.9 Additional Benefits
-------------------
During the term of this Agreement, Executive shall be
entitled to participate in all present and future employee
benefit plans and all other compensation and benefit
plans, programs and structures as may from time to time be
made available by the Company to all other key corporate
executives of the Company, and on terms and conditions no
less favourable than those generally available to other
such employees. In the event that the Company elects to
obtain key man life insurance insuring Executive,
Executive shall make himself available for the necessary
physical examinations and shall co-operate in all other
respects with the Company's efforts to obtain such
insurance.
5. Compensation upon Termination
-----------------------------
(a) In the event this Agreement is terminated pursuant
to sub-section 8.1(a) hereof, in addition to any
benefits to which Executive may then or following
the termination of his employment be entitled under
any other applicable policy or plan of the Company
then in effect (including basic life insurance
which coverage equals two times annual salary, and
survivor benefits which provide Accidental Death
and Dismemberment for each employee at two times
the annual salary), the Company shall pay to
Executive's estate his Base Salary, incentive
compensation and benefits due through the effective
date of termination. In the event that such
termination occurs on any date other than the last
day of the fiscal year, the incentive compensation
shall be based upon the performance goals achieved
at the end of the fiscal year, but shall be
prorated based upon the number of days which have
elapsed in the fiscal year through the date of
termination. Payment of this incentive
compensation or release of any stock representing
incentive compensation due under this Section 5(a)
shall be made no later than 120 days following the
end of the fiscal year with respect to which it is
being paid. Payment of all other amounts under
this Section 5(a) shall be made not later than the
30th day following the effective date of
termination. Executive's estate shall be entitled
to receive an amount equal to twenty-four (24)
times his then current monthly Base Salary.
(b) In the event this Agreement is terminated pursuant
to Sub-section 8.1(b)(i) hereof, Executive or his
representative shall be entitled to receive an
amount equal to twenty-four (24) times his then
current monthly Base Salary, less any disability
insurance benefits payable to Executive during such
twenty-four month period from disability policies
provided by the Company.
(c) In the event this Agreement is terminated pursuant
to Sub-section 8.1(b)(ii) or (iii) hereof,
Executive shall not be entitled to any compensation
other than his then current Base Salary which has
accrued through his date of termination, subject to
the Company's right of offset based upon acts of
Executive which gave rise to the termination.
(d) In the event this Agreement is terminated pursuant
to Sub-section 8.1(c) hereof, Executive shall be
entitled to a severance allowance equal to the
greater of (i) his Base Salary for all months
remaining in his then current term, or (ii) his
then current monthly Base Salary for twenty-four
(24) months.
(e) Subject to Section 5(a) payments or the release of
stock representing compensation to Executive
pursuant to this Section 5 shall be made in either
a lump sum payment or, at the sole discretion of
the Company in four (4) equal payments within six
(6) months of termination of this Agreement.
(f) In the event that Executive is terminated pursuant
to Subsections 8.1(a), 8.1(b)(i) or 8.1(c) hereof,
the expiration dates of Executive's options
currently outstanding pursuant to any of the
Company's stock option plans will be extended
twenty-four (24) months from the date of such
termination.
6. Confidential Information
------------------------
Except as permitted or directed by the Company's Board of
Directors, Executive shall not during the Term of this
Agreement or at any time thereafter divulge, furnish or
make accessible to anyone for use in any way (other than
in the ordinary course of the business of the Company) any
confidential or secret knowledge or information of the
Company (for the purposes of Sections 6 through 8 hereof,
the term "Company" shall be deemed to include any
subsidiary or affiliate of the Company) which Executive
has acquired or become acquainted with or will acquire or
become acquainted with prior to the termination of the
period of his employment by the Company, whether developed
by himself or by others, concerning any trade secrets,
confidential or secret designs, processes, formulae,
plans, devices or material (whether or not patented or
patentable) directly or indirectly useful in any aspect of
the business of the Company, and confidential customer or
supplier lists of the Company, any confidential or secret
development or research work of the Company, or any other
confidential or secret aspects of the business of the
Company. Executive acknowledges that the above described
knowledge or information constitutes a unique and valuable
asset of the Company acquired at great time and expense by
the Company and its predecessors, and that any disclosure
or other use of such knowledge or information other than
for the sole benefit of the Company would be wrongful and
would cause irreparable harm to the Company. Both during
and after the Term of this Agreement, Executive shall
refrain from any acts or omissions that would reduce the
value of the use of such knowledge or information to the
Company. The foregoing obligations of confidentiality,
however, shall not apply to any knowledge or information
which is now published or which subsequently becomes
generally publicly known, other than as a direct or
indirect result of the breach of this Agreement by
Executive.
7. Non-Competition, Solicitation of Customers, Solicitation
--------------------------------------------------------
of Employees
------------
7.1 Non-Competition
---------------
(a) Executive agrees that, during the period of his
employment hereunder and for a period of one (1)
year following the termination of such employment,
he shall not directly engage in competition with
the Company within the "Territory" (as hereinafter
defined) in any management capacity in any phase of
the Company's business of developing,
manufacturing, distributing, marketing, leasing or
selling any of the products which the Company is in
the business of developing, manufacturing,
distributing, marketing, leasing to others or
selling (the "Competitive Areas") during the Term
of this Agreement or which the Company has
definitive plans to develop, manufacture or market.
(b) The "Territory" shall be that area throughout the
world in which the Company presently markets its
products. This Agreement shall be deemed
automatically amended without the need of further
action by any party to add to any new countries or
parts thereof where after the date hereof and prior
to the termination of Executive's employment the
Company begins to market it products and to delete
any countries after no Company products have been
sold there for a period of six months.
(c) The restrictions in this Section 7 shall not apply
with respect to (i) a passive investment by
Executive of less than 5% of the outstanding shares
of capital stock of any corporation, or (ii)
employment by Executive with an entity in a
management capacity in an area of business which is
not, directly or indirectly, a Competitive Area.
7.2 Agreement Not to Solicit Customers. Executive agrees that
during his employment by the Company hereunder and for the
two (2) year period following the termination of such
employment, he shall not, without the prior written
consent of the Company, within the Territory, either
directly or indirectly, on his own behalf or in the
service or on behalf of others, solicit, divert or
appropriate, or attempt to solicit, divert or appropriate,
to any competing business any person or entity whose
account with the Company was sold or serviced by or under
the supervision of Executive during the year preceding the
termination of such employment.
7.3 Agreement Not to Solicit Employees. Executive agrees that
during his employment by the Company hereunder and for the
two (2) year period following the termination of such
employment, he shall not, either directly or indirectly,
on his own behalf or in the service or on behalf of
others, solicit, divert, or attempt to solicit or divert
any person then employed by the Company.
8. Termination
-----------
8.1 Grounds of Termination
----------------------
This Agreement shall terminate prior to the expiration of
the Initial Term set forth in Section 2 or any extension
thereof in the event that at any time during such Initial
Term or any extension thereof:
(a) Executive shall die; or
(b) The Board of Directors of the Company shall
determine that:
(i) Executive has become disabled; or
(ii) Executive has breached this Agreement in any
material respect, which breach is not cured
by Executive or is not capable of being
cured (as determined in the sole discretion
of the Company's Board of Directors) by
Executive within thirty (30) days after
written notice of such breach is delivered
to Executive; or
(iii) in its sole discretion Cause exists.
"Cause" means (A) conduct amounting to
fraud, embezzlement or misappropriation as
against the Company, (B) the wilful and
knowing material breach of any fiduciary
duty owed to the Company as an officer of
the Company other than done at the direction
of the Board of Directors, (C) having been
convicted of a criminal offence which may
have a material adverse effect on the
Company or the ability of Executive to carry
out his duties of employment, or (D) the
knowing failure of Executive to follow
specific directives of the Board of
Directors of the Company consistent with his
duties. If the Board of Directors
terminates this Agreement pursuant to this
Section 8.01(b)(iii), Executive will be
provided ninety (90) days written notice.
(c) The Board of Directors of the Company shall
determine, in its sole discretion, that the
termination of this Agreement is in the best
interest of the Company, and in which event
Executive shall have no duty to mitigate his
damages. If the Board of Directors terminates this
Agreement pursuant to this Section 8.1(c) Executive
will be provided ninety (90) days written notice.
Notwithstanding any termination of this Agreement,
Executive, in consideration of his employment hereunder to
the date of such termination, shall remain bound by the
provisions of this Agreement which specifically relate to
periods, activities or obligations upon or subsequent to
the termination of Executive's employment.
8.2 "Disability" Defined
--------------------
The Board of Directors may determine that Executive has
become disabled, for the purpose of this Agreement, in the
event that Executive shall fail, because of illness or
other physical or mental incapacity, to render services of
the character contemplated by this Agreement for an
aggregate of more than twelve (12) weeks during any twelve
(12) month period.
8.3 Surrender of Records and Property
---------------------------------
Upon termination of his employment with the Company,
Executive shall deliver promptly to the Company all
records, manuals, books, blank forms, documents, letters,
memoranda, notes, notebooks, reports, data tables,
calculations or copies thereof, which are the property of
the Company and which relate in any way to the business,
products, practices or techniques of the Company, and all
other property, trade secrets and confidential information
of the Company, including, but not limited to, all
documents which in whole or in part contain any trade
secrets or confidential information of the Company, which
in any of these cases are in his possession or under this
control.
9. Assignment and Enurement
------------------------
This Agreement shall enure to the benefit of and be
binding upon the parties hereto and their respective
heirs, successors, administrators, and permitted assigns.
The Company may, without the consent of Executive, assign
its rights and obligations under this Agreement to any
corporation, firm or other business entity with or into
which the Company may merge or consolidate, or to which
the Company may sell or transfer all or substantially all
of its assets or of which 50% or more of the equity
investment and of the voting control is owned, directly or
indirectly, by, or is under common ownership with, the
Company; provided, however, that if the assignee was not
previously part of a consolidated group with the Company,
Executive will receive payments and benefits as outlined
in Exhibit B attached hereto and incorporated herein.
10. Injunctive Relief
-----------------
Executive agrees that it would be difficult to compensate
the Company fully for damages for any violation of the
provisions of this Agreement, including without limitation
the provisions of Sections 6, 7 and 8.3. Accordingly,
Executive specifically agrees that the Company shall be
entitled to temporary and permanent injunctive relief to
enforce the provisions of this Agreement. This provision
with respect to injunctive relief shall not however,
diminish the right of the Company to claim and recover
damages in addition to injunctive relief.
11. Miscellaneous
-------------
11.1 Governing Law
-------------
This Agreement is made under and shall be governed by and
construed in accordance with the laws of the Province of
Ontario subject to any principles of conflict of laws.
11.2 Prior Agreements
----------------
This Agreement contains the entire agreement of the
parties relating to the subject matter hereof and
supersedes all prior agreements and understandings with
respect to such subject matter, and the parties hereto
have made no agreements, representations or warranties
relating to the subject matter of this Agreement which are
not set forth herein.
11.3 Withholding Taxes
-----------------
The Company may withhold from any benefits payable under
this Agreement all federal, state, city and other taxes as
shall be required pursuant to any law or governmental
regulation or ruling.
11.4 Amendments
----------
No amendment or modification of this Agreement shall be
deemed effective unless made in writing signed by the
party against whom enforcement of the waiver or estoppel
is sought. Any written waiver shall not be deemed a
continuing waiver unless specifically stated, shall
operate only as the specific term or condition for the
future or as to any act other than specifically waived.
11.5 Notices
-------
Any notice, request, demand or other document to be given
hereunder shall be in writing, and shall be delivered
personally or sent by registered, certified or express
mail or facsimile followed by mail as follows:
If to the Company:
Board of Directors
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇ ▇▇▇
If to Executive:
▇▇▇▇ ▇
▇▇-▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
or to such other address as either party hereto may
hereinafter duly give to the other.
11.6 Severability
------------
To the extent any provision of this Agreement shall be
invalid or unenforceable, it shall be considered deleted
herefrom and the remainder of such provision and of this
Agreement shall be unaffected and shall continue in full
force and effect. In furtherance and not in limitation of
the foregoing, should the duration or geographical extent
of, or business activities covered by any provision of
this Agreement be in excess of that which is valid or
enforceable under applicable law, then such provision
shall be construed to cover only that duration, extent or
activities which may be validly and enforceably be
covered. Executive acknowledges the uncertainty of the
law in this respect and expressly stipulates that this
Agreement be given the construction which renders its
provisions valid and enforceable to the maximum extent
(not exceeding its express terms) possible under
applicable law.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the day and year set forth above.
------------------------------
F ▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇
INTERNATIONAL MUREX
TECHNOLOGIES CORPORATION
By:
--------------------------------
▇▇▇▇▇▇ ▇ ▇▇▇▇, on behalf of the
Compensation Committee
and the Board of Directors
EXHIBIT A
---------
DEFERRED COMPENSATION PLAN
--------------------------
1. At the time the Executive elects to defer compensation
pursuant to Section 4.3 of the Employment Agreement, the
Executive shall also elect the percentage of such
compensation to be credited from the date of deferral to
the date it is paid to the Executive with either (a)
simple interest at a rate per annum equal to the average
of the rates then being earned by the Company on deposits
with a term of ninety days or less, adjusted on the first
day of each calendar quarter or (b) the same rate of
return experienced by the common stock of the Company.
The portion of the compensation deferred by the Executive
to which the Executive elects to have the Company common
stock rate of return apply shall be hypothetically
invested in shares of the Company's common stock based on
the closing price of the Company's common stock on the
Nasdaq National Market System, or such other exchange that
the Company's common stock may be listed at the time, on
the business day prior to the date on which the
compensation would otherwise be paid. The number of
shares of the Company's common stock in which the
Executive has hypothetically invested shall be adjusted to
reflect stock splits, stock dividends and other capital
changes affecting the outstanding common stock of the
Company in the same manner as an equivalent number of
actual shares of the Company's common stock are adjusted.
In addition, all cash distributions and the fair market
value (as determined in good faith by the Company) of any
property distributions with respect to shares of common
stock of the Company shall be reinvested in the common
stock of the Company based on the closing price of the
common stock as reported on the Nasdaq National Market
System, or such other exchange that the Company's common
stock may be listed at the time, on the business day prior
to the distribution. The portion of the Executive's
compensation deferred hereunder and credited with simple
interest, together with such simple interest, shall be
referred to herein as "Deferred Compensation". The
portion of Executive's compensation deferred hereunder and
credited with the rate of return of the common stock of
the Company shall be reflected in hypothetical shares of
the Company's common stock with each such share being
referred to herein as a "Stock Credit". On December 31st
of each year during which any Deferred Compensation or
Stock Credits remain unpaid, the Company shall provide the
Executive with a statement setting forth the amount of his
unpaid Deferred Compensation and the number of outstanding
Stock Credits.
2. The Deferred Compensation shall be paid to Executive in a
lump sum following the termination of his employment with
the Company for any reason on the 30th day following the
date of termination. The number of Stock Credits credited
to the Executive shall be paid to the Executive on the
30th date following the date of his termination, by the
release of common stock to the Executive."
3. Notwithstanding the foregoing, in the event of the
occurrence of an "unforeseeable emergency," as hereinafter
defined, Executive shall be entitled to a payment from the
Deferred Compensation (or release of common stock
representing Stock Credits) prior to the date set forth in
paragraph 2 of this Exhibit A of that amount reasonably
required to satisfy the emergency need. As used herein,
"unforeseeable emergency" shall be limited to (i) severe
financial hardship to Executive resulting from a sudden
and unexpected illness or accident of Executive or of a
dependent of Executive, as dependent is defined in Section
152 of the Internal Revenue Code or any successor
provision thereto, (ii) loss of Executive's property due
to casualty, or (iii) other similar extraordinary and
unforeseeable circumstances arising as a result of events
beyond the control of Executive. The circumstances that
will constitute an unforeseeable emergency will depend
upon the facts of each case, but, in any case, a payment
(or release) of all or any portion of the Deferred
Compensation in the event of an unforeseeable emergency
may not be made to the extent that such hardship is or may
be relieved;
(i) Through reimbursement or compensation by
insurance or otherwise,
(ii) By liquidation of Executive's assets, to the
extent the liquidation of such assets would not itself
cause severe financial hardship, or
(iii) By cessation of the deferral of the payment
of the Deferred Compensation pursuant to paragraph 2,
above.
4. The Company's obligation to pay the Deferred Compensation
or release of common stock representing Stock Credits
constitutes a mere promise by the Company to make these
payments at the times specified herein. Accordingly,
Executive shall have the status of a general unsecured
creditor with respect to the Deferred Compensation.
Executive's rights to the payment of Deferred Compensation
or the release of common stock representing Stock Credits
shall not be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge,
encumbrance, attachment, or garnishment by creditors of
Executive or his estate or any beneficiary of either
Executive or his estate.
