Exhibit 4.4
EMPLOYMENT AGREEMENT
THIS AGREEMENT made as of the 1st day of January, 2001
BETWEEN:
IMI INTERNATIONAL MEDICAL INNOVATIONS INC., a corporation existing under
the laws of Canada
(hereinafter called "IMP')
- and -
H.B. XXXXX XXXXXX, of the City of North York. in the Province of Ontario
(hereinafter called the "Employee").
WHEREAS IMI and the Employee wish to enter into a written agreement which
contains the agreed upon terms and conditions of employment for their mutual
benefit;
NOW THEREFORE in consideration of the mutual covenants and agreements
contained in this agreement and for other good and valuable consideration, the
adequacy of which is hereby acknowledged, the parties to this agreement do
mutually covenant and agree as follows:
ARTICLE 1 - DUTIES OF EMPLOYMENT
1.1 Position - The Company agrees to continue to employ the Employee in the
position of President and Chief Executive Officer, to serve in such capacity as
IMI's needs may, from time to time, require and as are made known to him by IMI
or its authorized representatives. In this capacity, the Employee shall perform
such services as are required from time to time by the Board of Directors of IMI
(the "Board") provided, however, that without the Employee's prior written
consent, the Employee shall not be required to perform services other than those
comparable in scope and dignity to those the Employee is presently performing.
1.2 Duties - The Employee accepts the office on the terms and conditions set
forth in this Agreement and acknowledges that as President and Chief Executive
Officer, he has the responsibility for the general supervision of the business
of IMI, subject to the authority of the Board. Throughout the term of his
employment, the Employee agrees to devote substantially all of his business time
and effort to carry out the performance of his duties under this Agreement and
shall conform to all lawful instructions and directions given to him by the
Board, or its authorized designees, and obey and carry out the by-laws of IMI,
as well as all written rules, policies and practices now or hereafter
established and amended from time to time by IMI for the conduct of its affairs
and brought to the attention of the Employee.
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ARTICLE II - AUTHORITY
2.1 The Employee shall have, subject always to the general or specific
instructions and directions of the Board, or its authorized designees,
including, without limitation, subject to the provisions and limitations of any
budget approved by the Board, full power and authority to manage and direct the
business and affairs of IMI consistent with the Employee's position as set out
in Section 1.1.
ARTICLE III - TERMS OF EMPLOYMENT
3.1 The provisions of the Agreement shall have effect from the date hereof and
shall continue in effect indefinitely or until terminated in accordance with the
provisions of this Agreement.
ARTICLE IV - EMPLOYEE'S COMPENSATION AND BENEFITS
4.1 Compensation - The annual base salary payable to the Employee for the
Employee's services hereunder for the term of this Agreement shall be $225,000
(gross), exclusive of bonuses, benefits and other compensation. The annual base
salary payable to the Employee pursuant to the provisions of this Article IV
shall be payable in equal semi-monthly installments, in arrears, in accordance
with existing practice, or in such other manner as may be mutually agreed upon,
less, in any case, any deductions or withholdings required by law.
4.2 Salary Review - The Employee's salary and benefits shall be as stated in
Article IV but shall be reviewed on January 1, 2002 and annually thereafter
during the term of this Agreement and any renewal of this Agreement.
4.3 Vacation - The Employee shall be entitled to vacation with pay of four (4)
weeks during each calendar year of this Agreement. Vacation not taken in one
year may not be carried over into subsequent years and shall expire at the end
of the applicable year.
4.4 Benefits - The Employee shall participate in all benefit plans which IMI
provides to its Employees, including extended health, medical and dental. In the
event that such benefit plans include additional benefits and/or coverage for
executives, then the Employee shall be entitled to such additional benefits.
4.5 Additional Compensation - The Employee shall also receive bonuses and
options to purchase shares of IMI as may be granted by the Board, in their
discretion, from time to time.
4.6 Expenses - IMI shall reimburse the Employee forthwith for all proper and
reasonable out-of-pocket expenses actually incurred by the Employee in the
performance of his duties upon presentation of supporting statements, receipts
or vouchers. Subject to the provisions of IMI's governing corporate legislation,
IMI agrees to indemnify and save the Employee harmless from and against any and
all demands, claims, costs, charges and expenses, including an amount paid to
settle an action or satisfy a judgment, reasonably incurred by him in respect of
any civil, criminal or administrative action or proceeding to which the Employee
is made a party by reason of having been a director or officer of IMI or of any
affiliated company, whether before or alter termination if:
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(a) the Employee acted honestly and in good faith with a view to the best
interests of IMI; and
(b) in the case of a criminal or administrative action or proceeding that
is enforced by a monetary penalty, the Employee had reasonable grounds
for believing that his conduct was lawful.
ARTICLE V - TERMINATION
5.1 Termination
Notwithstanding anything contained in this Agreement, IMI and the Employee agree
that this Agreement and the employment of the Employee may be terminated as
follows:
(a) immediately by IMI at its option, at any time, and without notice or
pay in lieu of such notice, for cause. For the purposes of this
Agreement, "cause" shall include the following:
(i) a material breach by the Employee of the provisions of Article VI
at any time;
(ii) conviction of the Employee of a criminal offence punishable by
indictment, or summary conviction where such conviction brings
into question the Employee's ability to perform his duties under
this Agreement honestly and effectively or where such conviction
could adversely affect the reputation and goodwill of IMI; and
(iii) in the event of death or any "disability", as such term is
defined in any disability insurance policy of IMI or if no such
policy is in place, disability shall mean mental or physical
disability or serious illness of the Employee which results in
the Employee being unable to substantially perform his duties
for a continuous period of 180 days or for periods aggregating
225 days in any period of 365 days;
(b) at any time by IMI, without cause by paying, in lieu of notice, an
amount equal to two years of the Employee's then current (i) annual
salary; (ii) benefits as contemplated in section 4.4; and (iii)
additional compensation as contemplated in section 4.5, all payable in
accordance with, and subject to the reduction contained in, Section
5.2 herein;
(c) by the Employee, upon prior written notice to IMI at any time within
180 days after the Change of Control of IMI in which case IMI shall
pay to the Employee an amount equal to two years of the Employee's
then current annual salary, payable immediately; or
(d) at any time by the Employee upon 90 days written notice to IMI.
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For the purposes of this Section 5.1,
"Associate" and "Affiliate" have the meanings ascribed thereto by the Securities
Act (Ontario) as at the date hereof;
"Concert Parties" means, in relation to any person, all other persons acting
jointly or in concert with such person. For the purposes hereof, it is a
question of fact as to whether a person is acting jointly or in concert with
another person in relation to IMI. Without limiting the generality of the
foregoing, the following shall be deemed to be acting jointly or in concert with
a particular person:
(i) every person who, as a result of any agreement, commitment or
understanding, whether formal or informal, with the particular
person or with any other person acting jointly or in concert with
the particular person, acquires or offers to acquire securities of
IMI;
(ii) every person who, as a result of any agreement, commitment or
understanding, whether formal or informal, with the particular person
or with any other person acting jointly or in concert with the
particular person, intends to exercise jointly or in concert with the
particular person or with any other person acting jointly or in
concert with the particular person any voting rights attaching to any
securities of IMI; and
(iii) every associate or affiliate of the particular person or of any
person who is acting jointly or in concert with the particular
person, and
"Change of Control" of IMI shall have occurred if:
(i) any person (other than the Employee) and the Concert Parties thereof
beneficially own more than 50% of the outstanding shares of IMI
entitled to vote generally in the election of directors of IMI; or
(ii) IMI completes (A) a merger or other business combination of IMI with
or into another corporation unless after giving effect thereto the
shareholders of IMI own shares of the successor corporation carrying
more than 50% of the votes in the election of directors; or (B) a
sale, exchange or other disposition of all or substantially all of
the assets of IMI.
5.2 Payment of Termination Amount. The amounts payable to the Employee as
contemplated in subsection 5.1(b) above shall be paid in 24 equal monthly
installments over a 23 month period beginning 30 days after the date of
termination provided, however, that if the Employee obtains alternative
employment during such 23 month period, the monthly installments beginning on
the later of:
(a) the date of the commencement of such alternative employment; and
(b) the date which is six months after the date of termination
shall be reduced by 50%.
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For the purposes of this Section 5.2, "alternative employment" shall mean any
form of remunerative activity in the nature of employment, whether as employee,
consultant, agent, partner, sole proprietor or otherwise.
5.3 Effect of Termination
(a) Upon termination of this Agreement, the employment of the Employee
shall be automatically terminated and the Employee shall have no
claims against IMI for failure to give reasonable notice of
termination or otherwise except in respect of payment of salary or
accrued vacation pay to the date of termination and payments
specifically provided for herein.
(b) Upon termination of employment, the Employee shall immediately resign
all offices (including directorships) held in IMI and the Employee
shall not be entitled to receive any additional severance pay or
compensation for loss of office or otherwise by reason of resignation
(other than as otherwise provided for herein). If the Employee fails
to resign as mentioned, IMI is irrevocably authorized to appoint some
person in the Employee's name and on his behalf to sign any documents
or do any thing necessary or requisite to give effect to it.
(c) If the Employee is terminated without cause or if the Employee
terminates this Agreement pursuant to subsection 5.1(c) above, all
options to acquire shares of IMI held by the Employee shall
immediately and automatically become fully vested and shall be
exercisable by the Employee within the time period which is sixty (60)
days from the date of such termination and, after such 60 day period,
all unexercised options held by the Employee shall expire and shall be
cancelled by IMI.
(d) If the Employee is terminated with cause, all options, whether vested
or otherwise, shall immediately expire and shall be cancelled at the
date of such termination.
(e) The provisions of subsections (c) and (d) above shall apply to all
options to acquire shares of IMI granted previously or hereafter to
the Employee unless the terms of such options specifically state that
such subsections do not apply.
5.4 Company's Property
The Employee acknowledges that all items of any and every nature or kind created
or used by the Employee pursuant to the Employee's employment under this
Agreement, or furnished by IMI to the Employee, and all equipment, credit cards,
books, records, reports, files, manuals, literature, confidential information or
other materials shall remain and be considered the exclusive property of IMI at
all times and shall be surrendered to IMI, in good condition, promptly on the
termination of the Employee's employment irrespective of the time, manner or
cause of termination. All personal effects used by the Employee in carrying out
his duties will
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remain the property of the Employee and shall be removed by him on termination
of his employment.
ARTICLE VI - CONFIDENTIAL INFORMATION AND NON-COMPETITION
6.1 Confidential Information
(a) The Employee acknowledges that throughout the course of his employment
with IMI the Employee may have access to and be entrusted with
confidential information, trade secrets and know-how concerning the
business and property of IMI and with information, trade secrets and
know-how which other persons shall require IMI and its employees,
agents and consultants to treat as confidential (all of which
information, trade secrets and know-how of IMI and others shall be
collectively defined as "Confidential Information").
(b) The Employee agrees that disclosure of any of the Confidential
Information or any use of the Confidential information other than on
behalf of or for the direct benefit of IMI is and will be highly
detrimental to IMI and that the right to maintain the confidentiality
of the Confidential Information constitutes a proprietary right which
IMI is entitled to protect or is an obligation which IMI must observe.
Accordingly, the Employee hereby agrees that:
(i) he shall keep confidential all of the Confidential Information
for the exclusive benefit and use of IMI and will faithfully do
all in his power to assist IMI hi keeping the Confidential
Information confidential until IMI shall make the same public
either by obtaining patent rights, copyrights or otherwise;
(ii) he shall not, directly or indirectly, disclose or divulge any of
the Confidential Information to any person, firm, corporation or
other entity of any kind whatsoever;
(iii) he shall not, directly or indirectly, either individually or in
partnership with, or jointly with one or more persons, firms,
corporations or any other entity of any kind whatsoever as
principal, agent, employee, shareholder or in any other capacity
or manner whatsoever, use any of the Confidential Information
other than on behalf of or for the direct benefit of IMI;
(iv) he shall not divulge, disclose or communicate to any person,
firm or corporation the name of any customer of IMI and/or the
Business (as hereinafter defined); and
(v) he shall not use for his own purpose any Confidential
Information relating to IMI and/or the Business.
(c) The Employee acknowledges that the restrictions contained herein for
the benefit of IMI are reasonable and not excessive in the
circumstances of the Employee's knowledge and the scope of his
employment.
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6.2 Non-Competition - The Employee agrees that the Employee will not, without
the prior written consent of IMI, while employed by IMI and for a period of two
(2) years after the date of termination as contemplated in subsections 5.1(a),
(b) or (d):
(a) directly or indirectly, in any manner whatsoever, including, without
limitation, either individually or in partnership or jointly, or in
conjunction with any other person or persons, firm, association,
syndicate, company or corporation, as principal, agent, shareholder or
in any other manner whatsoever, carry on or be engaged in any business
directly competitive with the business of IMI (the "Business") in any
country where IMI operates, or be concerned with or interested in or
lend money to, guarantee the debts or obligations of or permit his
name or any part thereof to be used or employed by any person,
persons, firm, association, syndicate, company or corporation engaged
in, concerned with or interested in any directly competitive business
except that the Employee may own no more than 5% of the total issued
and outstanding capital stock of a publicly-held or private
corporation engaged in, concerned with or interested in any directly
competitive business;
(b) directly or indirectly solicit, interfere with or endeavour to direct
or entice away from IMI any customer or any person, firm or
corporation in the habit of dealing with IMI, and/or the Business; or
(c) interfere with, entice away or otherwise attempt to obtain the
withdrawal of any employee or independent contractor of IMI or,
following termination of the Employee's employment, any employee who
was in the employ of IMI during the one (1) year period, as the case
may be, preceding termination for cause.
6.3 The Employee hereby acknowledges and agrees that all covenants, provisions
and restrictions contained in this Article VI hereof are reasonable and valid
and all defences to the strict enforcement thereof by IMI are waived by the
Employee.
6.4 The Employee further acknowledges and agrees that in the event of a
violation of the covenants, provisions and restrictions contained in this
Article VI, IMI shall be authorized and entitled to obtain from any court of
competent jurisdiction preliminary and permanent injunctive relief and an
accounting of all profits and benefits arising out of such violation, which
rights and remedies shall be cumulative and in addition to any other rights or
remedies to which IMI may be entitled.
6.5 It is understood by the Parties hereto that the covenants in this Article VI
by the Employee not to enter into competition with IMI are essential elements to
this Agreement and that, but for the agreement of the Employee to enter into
such covenants, IMI would not have retained the Employee.
ARTICLE VII - CLAUSES SURVIVING TERMINATION
7.1 Any confidentiality and non-solicitation clauses in Article VI of this
Agreement shall survive the termination of this Agreement, as shall Sections
4.6, 5.3 and 5.4 hereof.
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ARTICLE VIII - PLAIN ENGLISH
8.1 This Agreement is intended to be written in plain English. When words or
expressions of a general nature are employed herein, it is intended that they be
comprehensive, unless the context clearly dictates otherwise.
ARTICLE IX - GENERAL
9.1 General - Any notice, document or other communication required or permitted
to be given in respect of this Agreement shall be sufficiently given if
delivered to the party personally, or if sent by prepaid ordinary mail posted in
Canada, by courier, or by facsimile, to such party addressed as follows:
IMI:
IMI International Medical Innovations Inc.
0000 Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx X0X 0X0
Facsimile No: (000) 000-0000
Attention: Chairman
Employee:
H.B. Xxxxx Xxxxxx
00 Xxxxxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxx X0X 0X0
Any party may at any time change its address hereunder by giving notice of such
change of address to the other party or parties in the manner specified in this
paragraph. Any such notice or other written communication shall, if mailed or
sent by courier, be effective on the day it is delivered or an attempt is made
to deliver it to the address of the addressee and, if given by personal
delivery, shall be effective on the day of actual delivery.
9.2 Severability - If any covenant, provision or restriction contained in this
Agreement is found to be void or unenforceable in whole or in part, it shall not
affect or impair the validity of any other covenant, provision or restriction
and without limitation, each of the covenants, provisions and restrictions
contained herein are hereby declared to be separate and distinct covenants,
provisions and restrictions.
9.3 Waiver of Performance - The Employee and IMI may, in writing, extend the
time for performance or waive non-compliance or non-performance by the other of
the other's obligations, covenants and agreements under this Agreement No act or
failure to act of the Employee or IMI shall be deemed to be an extension or
waiver of timely or strict performance by the other of his/its obligations,
covenants and agreements under this Agreement.
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9.4 Governing Law - This Agreement shall be governed by and construed in
accordance with the laws of the Province of Ontario and the law of Canada
applicable therein and each of the parties hereby irrevocably attorn to the
jurisdiction of the courts of the Province of Ontario.
9.5 Entire Agreement - This Agreement set forth the entire agreement among the
parties hereto pertaining to the employment of the Employee and supersedes all
prior agreements, understanding, negotiations and discussions, whether oral or
written, of the parties hereto including, without limitation, the employment
agreement dated October 31, 1997 among the parties hereto, and there are no
warranties, representations or other agreements between the parties hereto in
connection with the subject matter hereof except as specifically set forth
therein. No supplement, modification, waiver or termination of this Agreement
shall be binding unless executed in writing by the parties to be bound thereby.
9.6 Assignment - This Agreement is personal to the Employee and may not be
assigned by him without the prior written consent of IMI, which consent may be
unreasonably withheld. This Agreement may not be assigned by IMI without the
prior written consent of the Employee, which consent may be unreasonably
withheld. Subject to the foregoing, this Agreement shall enure to the benefit of
and be binding upon the Parties and their respective successors, heirs,
executors, administrators, personal representatives and permitted assigns.
9.7 Heading - The headings used in this Agreement are for convenience only and
are not to be construed in any way as additions to or limitations of the
covenants and agreements contained herein.
9.8 Currency - All dollar amounts referred to in this Agreement shall be in
Canadian funds.
9.9 Time of Essence - Time is and shall always remain the essence of this
Agreement.
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IN WITNESS WHEREOF the parties hereto have executed this Agreement on the
thy and year first above written.
IMI INTERNATIONAL MEDICAL INNOVATIONS INC.
Per /s/ IMI c/s
SIGNED, SEALED AND DELIVERED )
In the presence of: )
)
)
/s/ Xxxxxxxx )
Witness ) /s/ Xxxxx Xxxxxx
) H.B. XXXXX XXXXXX
By signing, the Employee acknowledges he
understands the contents of this Agreement,
and in particular Article V relating to
termination and that he has been given the
opportunity to obtain Independent legal
advice and has either done so or chosen
not to obtain such advice.
TRA 1677882v1
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