Exhibit 10.11
EMPLOYMENT AGREEMENT
--------------------
MEMORANDUM OF AGREEMENT made at Montreal, Quebec, on the 8th day of January
2001.
BY AND BETWEEN: Avantron Technologies, Inc., a corporation
constituted pursuant to the Canada Business
Corporation Act, with a place of business
at 10, 000 Xxxxxxx-Xxxxxxxx, Xxxxx, Xxxxxx
HlJ 274, Canada;
(hereinafter, together with any successor
corporation, the "Corporation");
AND: Xxxxxxxx Xxxxxxx, executive, residing at 00
Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxx X0X
0X0, Xxxxxx;
(hereinafter, the "Employee")
WHEREAS the Employee, or an entity he controls, holds shares in the capital
of the Corporation;
WHEREAS Sunrise Telecom Canada (hereinafter together with its parent and
other affiliated corporations, "Sunrise") will purchase from the Employee and
other shareholders (hereinafter, collectively, the "Sellers"), all of the shares
held by the Sellers in the capital of the Corporation, pursuant to a share
purchase agreement dated January 8, 2001 (hereinafter, the "Share Purchase
Agreement"), the whole effective on the Closing Date;
WHEREAS the parties have agreed that the Employee shall remain in the
employ of the Corporation, or its successor corporation, after the Closing Date;
WHEREAS the parties consequently desire to enter into this Agreement
setting forth the terms and conditions of the employment of the Employee with
the Corporation after the Closing Date and the benefits attaching thereto;
NOW, THEREFORE, THIS AGREEMENT WITNESSETH THAT, in consideration of the
mutual covenants herein contained, the parties agree as follows:
ARTICLE I
INTERPRETATION
--------------
1.1 Definitions. Where used herein or in any amendments hereto or in any
-----------
communication required or permitted to be given hereunder, the following words
and phrases shall have the following meanings, respectively, unless the context
otherwise requires:
(a) "Agreement" shall mean this Employment Agreement and all instruments
supplemental hereto or in amendment or confirmation hereof; "herein",
"hereof", "hereto", "hereunder" and similar expressions mean and refer
to this Agreement and not to any particular Article, Section,
Subsection or other subdivision; "Article", "Section", "Subsection" or
other subdivision of this Agreement means and refers to the specified
Article, Section, Subsection or other subdivision of this Agreement;
(b) "Business" shall mean the business conducted by the Corporation at the
time of the signature of this Agreement, the business conducted by the
Corporation up to the termination of the Employee's employment as well
as the business that the Corporation was in the process of developing
at the time of the termination of the Employee's employment. For
greater certainty, the business conducted by the Corporation at the
time of the signature of this Agreement can be described as making,
manufacturing, marketing, selling, offering to sell, advertising or
distributing of telecommunications test equipment;
(c) "Cause" shall mean any event or circumstance which, pursuant to
applicable law, constitutes serious reason for dismissal without
either notice, payment in lieu of notice, severance pay or any
indemnity whatsoever;
(d) "Closing Date" shall have the meaning which is set forth in the Share
Purchase Agreement;
(e) "Customer" shall mean any and all Persons having purchased the
Corporation's or Sunrise's goods or services in connection with the
Business at any time during the two (2) year period preceding the
termination of the Employee's employment;
(f) "Confidential Information" shall mean all information howsoever
received by the Employee from or through the Corporation or Sunrise in
whatever form (oral, written, machine readable or otherwise)
pertaining to the Corporation or Sunrise, including, without
limitation, all information related to, processes, formulas, research,
developments, financial information, marketing information, names or
lists of Customers, prospective Customers, suppliers or distributors;
provided, however, that the phrase "Confidential Information" shall
not include information that:
(i) is in the public domain, or generally known in the industry in
which the Corporation and Sunrise operate, without any fault or
responsibility of the Employee,
(ii) is approved in writing by the Corporation and Sunrise for
disclosure by the Employee prior to its actual disclosure,
(iii) is lawfully received by the Employee from a Person (other than
from any of the other Sellers) who is lawfully in possession of
such Confidential
2
Information and such Person was not restricted from disclosing
same to the Employee;
(g) "Incapacity" shall mean any medical condition whatsoever which leads
to the Employee's absence from his job function for a continuous
period of six (6) months without the Employee being able to resume
functions on a full time basis at the expiration of such period; and
unsuccessful attempts to return to work for periods under fifteen (15)
days shall not interrupt the calculation of such six (6) month period;
(h) "Intellectual Property Rights" shall mean all registered and
unregistered intellectual property rights including, without limiting
the generality of the foregoing, all intellectual property rights
attached to:
(i) all inventions, trademarks, trade names, copyrightable Works,
industrial designs, trade secrets, topographies and all other
intellectual property rights; and
(ii) all domestic and foreign registrations, applications and renewals
thereof for registration of intellectual property rights;
(i) "Person" shall mean an individual, corporation, company, cooperative,
partnership, trust, unincorporated association, entity with juridical
personality or governmental authority or body; and pronouns which
refer to a Person shall have a similarly extended meaning;
(j) "Territory" shall mean the every State of the United States and every
Province of Canada; and
(k) "Works" shall mean all discoveries, inventions, improvements,
innovations, processes, topographies, codes, software, know-how,
recipes, technology, formulas, drawings, specifications for products,
materials and equipment, process development and ideas including all
related documentation on whatever support it is, of which the Employee
is solely or jointly in whole or in part, an inventor, discoverer,
author, conceiver or originator.
1.2 Preamble. The preamble hereof shall form an integral part of this
--------
Agreement.
ARTICLE II
DUTIES
------
2.1 As President of the Corporation, the Employee's duties and responsibilities
shall include, above and beyond those inherent to the Employee's title and
normally pertaining to it, those compatible with the Employee's position and
which the Corporation or its Board of Directors may delegate to him from time to
time.
3
ARTICLE III
DURATION
--------
3.1 This Agreement is hereby concluded for an indeterminate period of time.
ARTICLE IV
SALARY
------
4.1 The Employee shall receive an annual base salary of Three hundred and
ninety thousand Canadian dollars (Cdn$390,000.00), to be paid in twenty-four
(24) equal installments (hereinafter, the "Base Salary"). Base Salary may be
modified upwards or downwards in the reasonable discretion of the Corporation.
ARTICLE V
BONUS
-----
5.1 For the first reference year following the Closing Date, the Employee shall
receive a bonus of two million thirty one thousand, one hundred seventy Canadian
dollars (Cdn$2,031,170). Such bonus is contingent that the Employee be an
employee in good standing of the Corporation, unless his employment was
terminated by death, by total disablement, or by the Corporation for its
convenience, on the first anniversary of the Closing Date, that there has been
no breach of this Employment Agreement, and that this Employment Agreement, in
its current form, be in full force and effect (unless his employment was
terminated by death, total disablement or by the Corporation for its
convenience). This bonus is contingent on the shareholders of the Corporation
voting unanimously in favor of it. Such vote must occur before the date hereof.
5.2 For the second reference year following the Closing Date, the Employee
shall receive a bonus of two million and three hundred and twenty-one thousand
and two hundred and fifty seven Canadian dollars (Cdn$2,321,257). Such bonus is
contingent that the Employee be an employee in good standing of the Corporation,
unless his employment was terminated by death, by total disablement, or by the
Corporation for its convenience, on the second anniversary of the Closing Date,
that there has been no breach of this Employment Agreement, and that this
Employment Agreement be in full force and effect (unless his employment was
terminated by death, total disablement or by the Corporation for its
convenience). This bonus is contingent on the shareholders of the Corporation
voting unanimously in favor of it. Such vote must occur before the date hereof.
5.3 After the second reference year, any bonus, which the Employee will be
eligible to receive, shall be reviewed by the Board of Directors on a yearly
basis. Any bonus shall be subject to the attainment of certain objectives set
forth by the Corporation. In addition, the Employee shall receive an award of
options to purchase the stock of Sunrise Telecom Incorporated, such award to be
made in accordance with the terms and conditions established by the Compensation
Committee of the Board of Directors of Sunrise Telecom Incorporated at its next
meeting after the date hereof.
4
5.4 Employee's bonus earned under Section 5.1 and 5.2 shall be payable to his
heirs only in the event that his employment was terminated by death.
ARTICLE VI
BENEFITS AND VACATION
---------------------
6.1 The Employee shall participate in all benefit programs and/or plans which
are presently granted or which, at any time during his employment, may be
granted to management employees of the Corporation or its parent corporation,
the whole in accordance with the actual programs or plans that the Corporation
may institute from time to time or as otherwise required under any applicable
law.
6.2 All authorized expenses incurred by the Employee during his employment in
connection with the performance of his duties and supported with appropriate
vouchers shall be paid by the Corporation.
6.3 The Employee shall be granted twenty-five (25) days per year of paid
vacation, to be taken at times mutually agreed upon between the Employee and the
Corporation.
ARTICLE VII
LOYALTY
-------
7.1 The Employee shall act with diligence, loyalty and honesty and shall make
all necessary efforts to promote the Corporation's legitimate interests.
ARTICLE VIII
CONFIDENTIALITY
---------------
8.1 The Employee hereby agrees not to use, divulge, diffuse, sell, transfer,
give, publish, reproduce, circulate, or otherwise distribute to any Person, or
otherwise make public, any Confidential Information.
8.2 Any document or work composed, assembled or produced by the Employee or the
Corporation and containing Confidential Information (including, without
limitation, all notes, extracts, text or references from which any Confidential
Information can be implicitly or otherwise revealed or understood) shall be
deemed to be Confidential Information within the meaning of this Agreement and
shall be treated as such.
8.3 Confidential Information and all embodiments thereof (including any
reproduction) shall remain the sole property of the Corporation and shall be
returned to the Corporation immediately upon request to this effect or
immediately after the termination of the Employee's employment.
8.4 Anything to the contrary herein notwithstanding, disclosure of Confidential
Information shall not be precluded if such disclosure is in response to a valid
order of a governmental body or is otherwise required by law; provided however
that the Employee shall, if reasonably
5
ble, first have given notice thereof to the Corporation and shall have, as
---
reasonably ble:
---
(a) fully cooperated in the Corporation's attempt, if any, and at the
Corporation's cost, to obtain a "protective order" from the
appropriate governmental body; or
(b) fully cooperated in the Corporation's attempt, if any, and at the
Corporation's cost, to classify such documents to prevent access by
the public, in accordance with the provisions of any law pertaining to
freedom of information.
ARTICLE IX
WORKS
-----
With respect to Works made or conceived by him during his employment or
within the three (3) month period following the termination of his employment
with the Corporation for any reason, the Employee shall perform the following:
(a) promptly disclose and describe such Works in writing to the
Corporation;
(b) assign (and the Employee does hereby assign) to the Corporation or
such Person designated by the Corporation, without further
compensation (but at the Corporation's expense), upon request and in
the manner prescribed by the Corporation, all his rights, title and
interest in and to said Works and to Intellectual Property Rights
related to said Works throughout the world and waive (and the Employee
does hereby waive) any and all other rights that are non-assignable,
including but not limited to moral rights in all copyrightable Works;
(c) deliver promptly to the Corporation, upon request and in the form and
manner prescribed by the Corporation (without charge to the
Corporation but at the Corporation's expense), all written instruments
and documentation relating to said Works and Intellectual Property
Rights and do such acts as deemed necessary by the Corporation to
obtain, maintain and to transfer all rights and title thereto to the
Corporation at the Corporation's cost; and
(d) give all assistance that may be required by the Corporation or the
Person designated by the Corporation, at the Corporation's cost, to
enable it to protect or exploit the Works and Intellectual Property
Rights in any country of the world.
9.2 In consideration of the salary that the Employee receives from the
Corporation, all Works (including all data and records pertaining thereto) that
the Employee may invent, discover, author, originate or conceive during his
employment with the Corporation or during the three (3) month period following
the termination of his employment for any reason and all Intellectual Property
Rights relating thereto shall be the sole and exclusive property of the
Corporation.
9.3 The provisions of sections 9.1 and 9.2 shall not apply to Works that
fulfill all of the following criteria:
6
(a) for which no equipment, supplies, facility or Confidential
Information, Intellectual Property Rights or trade secrets belonging
to the Corporation or to Sunrise were used;
(b) which do not relate to the Business or to the Corporation's or
Sunrise's actual or demonstrably anticipated processes, research or
development which the Employee had access to or knowledge of; and
(c) which do not result from any work performed by the Employee for the
Corporation or for Sunrise.
Schedule A attached hereto contains a list and brief description of all
Works the Employee made or conceived prior to or since the beginning of his
employment with the Corporation and that the Employee and the Corporation
believe should be excluded from the application of the provisions of sections
9.1 and 9.2.
ARTICLE X
OBLIGATION OF NON-COMPETITION
-----------------------------
10.1 The Employee shall not, during his employment and for a period of two (2)
years following the termination of his employment, on his own behalf or on
behalf of any Person, whether directly or indirectly, in any capacity
whatsoever, alone, through or in connection with any Person, carry on or be
employed by, be engaged in or have any financial or other interest in or be
otherwise commercially involved in any endeavour, activity or business in all or
part of the Territory which is in competition, in whole or in part, with the
Business. Notwithstanding the foregoing, the Employee may invest passively in
any business through mutual funds.
ARTICLE XI
OBLIGATION OF NON-SOLICITATION OF CUSTOMERS
-------------------------------------------
11.1 The Employee shall not during his employment and for a period of one (1)
year following the termination of his employment, on his own behalf or on behalf
of any Person, whether directly or indirectly, in any capacity whatsoever,
alone, through or in connection with any Person, for any purpose which is in
competition, in whole or in part, with the Business, solicit any Customer or
procure or assist in the soliciting of any Customer.
ARTICLE XII
OBLIGATION OF NON-SOLICITATION OF EMPLOYEES
-------------------------------------------
12.1 The Employee shall not, during his employment and for a period of one (1)
year following the termination of his employment, on his own behalf or on behalf
of any Person, whether directly or indirectly, in any capacity whatsoever,
alone, through or in connection with any Person, employ, offer employment to or
solicit the employment or engagement of or otherwise entice away from the
employment of the Corporation or Sunrise any individual who is employed by the
Corporation or Sunrise at the time of the termination of the Employee's
employment or who was employed by the Corporation or Sunrise in the six (6)
month period preceding the termination of the Employee's employment.
7
ARTICLE XIII
TERMINATION OF EMPLOYMENT
-------------------------
13.1 The parties hereto acknowledge and expressly agree that the Employee's
employment may be terminated in any of the following eventualities:
(a) At any time, for Cause, on simple notice from the Corporation to the
Employee, the whole without other notice, pay in lieu of notice,
severance pay or any indemnity whatsoever, except as may otherwise be
required by applicable law; or
(b) Upon the death or the Incapacity of the Employee, the whole without
any notice, pay in lieu of notice, severance pay or any indemnity
whatsoever, except as may otherwise be required by applicable law;
(c) Upon ninety (90) days notice in writing from the Employee to the
Corporation, specifying the intention of the Employee to resign; in
which event the Corporation shall only be obliged to pay to the
Employee his Base Salary plus benefits (excluding bonus) and other
allowable expenses paid by the Corporation hereunder, for such
remaining part of the period specified in the said notice from the
Employee and the Corporation shall have no further obligation
hereunder in the event of such resignation of the Employee.
(d) At any time, without Cause, on simple notice from the Corporation to
the Employee, subject to Article XIV.
ARTICLE XIV
TERMINATION ALLOWANCE: TERMINATION WITHOUT CAUSE
------------------------------------------------
14.1 Should the Employee's employment be terminated by the Corporation without
Cause, the Employee shall receive and the Corporation hereby undertakes to give
to the Employee, a notice or an indemnity in lieu of notice representing the
Employee's Base Salary plus benefits (excluding bonus) for a period to be
calculated as follows: one (1) month per year of service, with a minimum of six
(6) months and a maximum of eighteen (18) months.
14.2 The Employee recognizes and accepts that the Corporation shall not, in any
case, be responsible for any additional amount, indemnity in lieu of notice,
severance pay or other damages arising from the termination of his employment,
above and beyond those specifically provided for herein.
14.3 The Employee undertakes to give to the Corporation a full and satisfactory
written release upon receipt of the payment due to him in accordance with this
Article XIV.
ARTICLE XV
MISCELLANEOUS
-------------
15.1 Headings. The headings in this Agreement are inserted for convenience of
--------
reference on1y and shall not affect the interpretation hereof.
8
15.2 Severability. Any Article, Section, Subsection or other subdivision of
------------
this Agreement or any other provision of this Agreement which is, or becomes,
illegal, invalid or unenforceable shall be severed herefrom and shall be
ineffective to the extent of such illegality, invalidity or unenforceability and
shall not affect or impair the remaining provisions hereof, which provisions
shall (a) be severed from any illegal, invalid or unenforceable Article,
Section, Subsection or other subdivision of this Agreement or any other
provision of this Agreement; and (b) otherwise remain in full force and effect.
15.3 Amendments. No amendment shall be binding unless expressly provided in an
----------
instrument duly executed by the parties.
15.4 Waiver. No waiver, whether by conduct or otherwise, of any of the
------
provisions of this Agreement shall be deemed to constitute a waiver of any other
provisions (whether or not similar) nor shall such waiver constitute a
continuing waiver unless otherwise expressly provided in an instrument duly
executed by the parties to be bound thereby.
15.5 Governing Law. This Agreement shall be governed by and interpreted and
-------------
construed in accordance with the laws of the Province of Quebec and the laws of
Canada applicable therein.
15.6 No Contradiction. The restrictive covenants which are part of this
----------------
Agreement, such as the obligation of non-competition which is set forth at
Article X, shall not be deemed to be in contradiction with the restrictive
covenants which are included in the Share Purchase Agreement of even date
herewith, but shall be in addition one to another.
15.7 Language. The parties hereto acknowledge that they have requested and are
--------
satisfied that this Agreement and all related documents be drawn up in the
English language. Les parties aux presentes reconnaissent avoir requis que la
presente entente et les documents qui y sont relatifs soient rediges en anglais.
9
IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto
on the date and at the place first above mentioned.
AVANTRON TECHNOLOGIES, INC.,
Per: /s/ Xxxxxxxx Xxxxxxx
-------------------------------
Xxxxxxxx Xxxxxxx
/s/ Xxxxxxxx Xxxxxxx
-------------------------------
Xxxxxxxx Xxxxxxx
[Employment Agreement]
EMPLOYMENT AGREEMENT AMENDMENT
------------------------------
This Amendment to Employment Agreement is entered by and between Xxxxxxxx
Xxxxxxx, an individual, and Sunrise Telecom Broadband Corp., an unlimited
liability company existing under the laws of Nova Scotia, Canada, as of March
12, 2002. (Sunrise Telecom Broadband Corp. is the successor to Avantron
Technologies, Inc.)
On January 8, 2001, Sunrise and Xx. Xxxxxxx entered into an Employment
Agreement. Except as amended hereby, the parties acknowledge and affirm the
Employment Agreement.
Now, for good and valuable consideration, the receipt and sufficiency of
which the parties hereby acknowledge, the parties amend the Employment Agreement
as follows:
Paragraph 5.2 is hereby deleted in its entirety and in its stead:
5.2 For the second reference year following the Closing Date, the Employee
shall receive a bonus of one million and one hundred and sixty thousand and
six hundred and twenty nine Canadian dollars (Cdn$1,160,629). Such bonus is
contingent that the Employee be an employee in good standing of the
Corporation, unless his employment was terminated by death, by total
disablement, or by the Corporation for its convenience, on the second
anniversary of the Closing Date, that there has been no breach of this
Employment Agreement, and that this Employment Agreement be in full force
and effect (unless his employment was terminated by death, total
disablement or by the Corporation for its convenience).
5.2A For the third reference year following the Closing Date, the Employee
shall receive a bonus of one million and one hundred and sixty thousand and
six hundred and twenty nine Canadian dollars (Cdn$1,160,629). Such bonus is
contingent that the Employee be an employee in good standing of the
Corporation, unless his employment was terminated by death, by total
disablement, or by the Corporation for its convenience, on the third
anniversary of the Closing Date, that there has been no breach of this
Employment Agreement, and that this Employment Agreement be in full force
and effect (unless his employment was terminated by death, total
disablement or by the Corporation for its convenience).
/s/ Xxxxxxxx Xxxxxxx
--------------------------------------
Xxxxxxxx Xxxxxxx
SUNRISE TELECOM BROADBAND CORP.
By: /s/ Xxxxxxxx Xxxxxxx
--------------------------------------
Xxxxxxxx Xxxxxxx
President
