EXHIBIT 10.35
EMPLOYMENT AGREEMENT
[QLT INC. LOGO]
This Employment Agreement made effective as of September 26, 2005 (the
"EFFECTIVE DATE").
BETWEEN:
QLT INC., having an address of 000 Xxxxx Xxxxxxxx Xxx, Xxxxxxxxx, Xxxxxxx
Xxxxxxxx, X0X 0X0, Xxxxxx.
("QLT" or the "COMPANY")
AND:
XXXXXX X. XXXXXXXXXX, having an address of [Redacted], British Columbia,
[Redacted], Canada.
("XX. XXXXXXXXXX")
WHEREAS:
A. Xx. Xxxxxxxxxx has been employed by QLT since 1998 and currently serves as
Senior Vice President, Marketing and Sales Planning of QLT.
B. QLT has offered to Xx. Xxxxxxxxxx, and Xx. Xxxxxxxxxx has accepted, a
promotion to Acting Chief Executive Officer.
C. QLT and Xx. Xxxxxxxxxx wish replace the prior employment agreement dated
August 25, 1998, as amended, entered to enter into between them with this
Agreement to set out the new terms and conditions of Xx. Xxxxxxxxxx'x
employment with QLT in the position as Acting Chief Executive Officer.
NOW THEREFORE in consideration of the payment of $10 by QLT to Xx. Xxxxxxxxxx
and in further consideration of the compensation to be paid to Xx. Xxxxxxxxxx
under this Agreement, the promises made by each party to the other as set out in
this Agreement and other good and valuable consideration, the receipt and
sufficiency of which the parties acknowledge and agree, QLT and Xx. Xxxxxxxxxx
agree as follows:
1. POSITION AND DUTIES
1.1 POSITION - Effective immediately, Xx. Xxxxxxxxxx will be employed by QLT in
the position of Acting Chief Executive Officer and Xx. Xxxxxxxxxx agrees to
be employed by QLT in that position, subject to the terms and conditions of
this Agreement.
1.2 DUTIES, REPORTING AND EFFORTS - In the performance of his duties as Acting
Chief Executive Officer, Xx. Xxxxxxxxxx shall:
(a) OVERALL RESPONSIBILITIES - Have the responsibilities commensurate with
the position of Acting Chief Executive Officer and with the goal of
achieving QLT's overall long-term strategic objectives, increasing
shareholder value and maintaining the integrity of QLT's internal
controls and reporting systems.
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(b) REPORT - Report, as and when required, to the Board of Directors of QLT
(the "BOARD").
(c) BEST EFFORTS - Use his best efforts, industry and knowledge to improve
and increase QLT's business, to comply with all of QLT's rules,
regulations, policies (including QLT's Code of Ethics and Code of
Exemplary Conduct) and procedures, as established from time to time and
to ensure that QLT is at all times in compliance with applicable
provincial, state, federal and other governing statutes, policies and
regulations.
(d) WORKING DAY - Devote the whole of his working day attention and energies
to the business and affairs of QLT.
2. COMPENSATION
2.1 ANNUAL COMPENSATION - In return for his services under this Agreement,
effective immediately, QLT agrees to pay or otherwise provide the following
total annual compensation to Xx. Xxxxxxxxxx:
(a) BASE SALARY - A base salary in the amount of Cdn.$520,000 in 24 equal
installments payable semi-monthly in arrears, subject to periodic annual
reviews at the discretion of QLT.
(b) BENEFIT PLANS - Coverage for Xx. Xxxxxxxxxx and his eligible dependents
under any employee benefit plans provided by/through QLT to its
employees, subject to:
I. Each plan's terms for eligibility,
II. Xx. Xxxxxxxxxx taking the necessary steps to ensure effective
enrollment or registration under each plan, and
III. Customary deductions of employee contributions for the premiums of
each plan.
As at the date of this Agreement, the employee benefit plans provided
by/through QLT to its employees include life insurance, accidental death
and dismemberment insurance, dependent life insurance, vision-care
insurance, health insurance, dental insurance and short and long term
disability insurance. QLT and Xx. Xxxxxxxxxx agree that employee benefit
plans provided by/through QLT to its employees may change from time to
time.
(c) EXPENSE REIMBURSEMENT - Reimbursement, in accordance with QLT's Policy
and Procedures Manual (as amended from time to time), of all reasonable
business related promotion, entertainment and/or travel expenses
incurred by Xx. Xxxxxxxxxx, subject to him maintaining proper accounts
and providing documentation for these expenses upon request.
(d) VACATION - That number of weeks of paid vacation per year as determined
in accordance with QLT's standard vacation policy for executive level
employees. As per QLT's Policy and Procedures Manual (as amended from
time to time), unless agreed to in writing by QLT:
I. All vacation must be taken within one year of the year in which it
is earned by Xx. Xxxxxxxxxx, and
II. Vacation entitlement shall not be cumulative from year to year.
(e) RRSP CONTRIBUTIONS - Provided the conditions set out below have been
satisfied, in January or February of the year following the year in
which the income is earned by Xx. Xxxxxxxxxx (the "INCOME YEAR"), QLT
shall make a contribution of up to 7% of Xx. Xxxxxxxxxx'x annual base
salary for the Income Year to Xx. Xxxxxxxxxx'x Registered Retired
Savings Plan ("RRSP"). The contribution to Xx. Xxxxxxxxxx'x RRSP as set
out above is subject the following conditions:
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I. The maximum contribution to be made by QLT to Xx. Xxxxxxxxxx'x RRSP
is 50% of the annual limit for Registered Retirement Savings Plans
as established by Canada Customs and Revenue Agency for the Income
Year,
II. Xx. Xxxxxxxxxx must have contributed an equal amount into his RRSP,
and
III. Xx. Xxxxxxxxxx is still actively employed by QLT when the matching
contribution would otherwise be made.
(f) CASH INCENTIVE COMPENSATION PLAN - Participation in the Cash Incentive
Compensation Plan offered by QLT to its senior executives in accordance
with the terms of such Plan, as amended from time to time by the Board.
Under the Cash Incentive Compensation Plan, Xx. Xxxxxxxxxx will be
eligible to receive each year as a lump sum payment a target Cash
Incentive Compensation Amount equal to 40% of his base salary in respect
of that part of 2005 worked prior to September 26, 2005 and 50% of his
base salary in respect of periods worked on or after September 26, 2005.
The amount of that payment each year will be determined at the sole
discretion of the Board and will be based on the performance of QLT
relative to pre-set corporate objectives and milestones for the
immediately preceding fiscal year.
(g) SPECIAL STOCK OPTION GRANT - The Board has approved, and QLT will grant
to Xx. Xxxxxxxxxx, options to purchase 250,000 common shares of QLT at a
price equal to the closing price of QLT's common shares on the Toronto
Stock Exchange on September 23, 2005. Those options will vest (a) as to
options to purchase 75,000 common shares of QLT, on the earlier of (i)
March 25, 2006, the date that Xx. Xxxxxxxxxx'x employment is terminated
by QLT without cause, or (iii) the date that Xx. Xxxxxxxxxx resigns for
Good Reason (as defined in paragraph 5.2), and (b) as to the remaining
options to purchase 175,000 common shares of QLT, will vest monthly in
equal numbers over three years from the grant date. The options will be
subject to the terms and conditions set out in QLT's current Stock
Option Incentive Plan and have a five year term from the date of grant.
(h) STOCK OPTION PLAN - Participation in any stock option plan offered by
QLT to its employees, in accordance with the terms of the plan in effect
at the time of the stock option offer(s).
2.2 ADDITIONAL COMPENSATION - In addition to any cash incentive payment made
under paragraph 2.1(f), as additional consideration for the obligations
assumed by Xx. Xxxxxxxxxx under this Agreement, QLT will pay to Xx.
Xxxxxxxxxx a one-time bonus of Cdn.$100,000 (less statutory deductions)
promptly after the Effective Date. In addition, QLT will provide to Xx.
Xxxxxxxxxx during 2005 temporary accommodation assistance for a maximum of
3-months temporary accommodation in such a place and at such rates as
designated by QLT.
3. RESIGNATION
3.1 RESIGNATION - Xx. Xxxxxxxxxx may resign from his employment with QLT by
giving QLT 60 days prior written notice (the "RESIGNATION NOTICE") of the
effective date of his resignation. Unless Xx. Xxxxxxxxxx is resigning for
Good Reason (as defined in paragraph 5.2), then on receiving a Resignation
Notice, QLT may elect to provide the following payments in lieu of notice to
Xx. Xxxxxxxxxx and require him to leave the premises forthwith:
(a) BASE SALARY - Base salary owing to Xx. Xxxxxxxxxx for the 60-day notice
period.
(b) BENEFITS - Except as set out below in this subparagraph 3.1(b), for the
60-day notice period, all employee benefit plan coverage enjoyed by Xx.
Xxxxxxxxxx and his eligible dependents prior to the date of his
Resignation Notice. Xx. Xxxxxxxxxx acknowledges and agrees that any
pension and short and long term disability plans provided through QLT
will not be continued beyond the last day that
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Xx. Xxxxxxxxxx works at QLT's premises (the "LAST ACTIVE DAY").
(c) EXPENSE REIMBURSEMENT - Reimbursement (in accordance with QLT's Policy
and Procedures Manual, as amended from time to time) of all reasonable
business related promotion, entertainment and/or travel expenses
incurred by Xx. Xxxxxxxxxx prior to his Last Active Day, subject to the
expense reimbursement provisions set out in subparagraph 2.1(c).
(d) VACATION PAY - Payment in respect of accrued but unpaid vacation pay
owing to Xx. Xxxxxxxxxx as at the expiry of the 60-day notice period.
(e) PRORATED RRSP CONTRIBUTION - A prorated contribution to Xx. Xxxxxxxxxx'x
RRSP, the pro-ration to be with respect to the portion of the current
calendar year worked by Xx. Xxxxxxxxxx, up to and including the 60-day
notice period, and the contribution to be subject to the conditions set
out in subparagraph 2.1(e), except condition III.
3.2 OTHERS - In the event of resignation of Xx. Xxxxxxxxxx as set out in
paragraph 3.1, the parties agree:
(a) NO BONUS - Xx. Xxxxxxxxxx will have no entitlement to participate in
QLT's Cash Incentive Compensation Plan for the year in which he resigns
his employment with QLT; and
(b) STOCK OPTION PLAN - Xx. Xxxxxxxxxx'x participation in any stock option
plan offered by QLT to its employees shall be in accordance with the
terms of the plan in effect at the time of the stock option offer(s) to
Xx. Xxxxxxxxxx.
4. RETIREMENT
4.1 RETIREMENT - Effective the date of retirement (as defined in QLT's Policy
and Procedures Manual, as amended from time to time) of Xx. Xxxxxxxxxx from
active employment with QLT, the parties agree that:
(a) THIS AGREEMENT - Subject to the provisions of paragraph 10.6, both
parties' rights and obligations under this Agreement will terminate
without further notice or action by either party.
(b) STOCK OPTIONS - Xx. Xxxxxxxxxx'x participation in any stock option plan
offered by QLT to its employees shall be in accordance with the terms of
the plan in effect at the time of the stock option offer(s) to Xx.
Xxxxxxxxxx.
5. TERMINATION
5.1 TERMINATION FOR CAUSE - QLT reserves the right to terminate Xx. Xxxxxxxxxx'x
employment at any time for any reason. Should Xx. Xxxxxxxxxx be terminated
for cause, he will not be entitled to any advance notice of termination or
pay in lieu thereof.
5.2 TERMINATION OTHER THAN FOR CAUSE OR RESIGNATION FOR GOOD REASON - QLT
reserves the right to terminate Xx. Xxxxxxxxxx'x employment at any time
without reason. However, if (a) QLT terminates Xx. Xxxxxxxxxx'x employment
for any reason other than for cause, or (b) Xx. Xxxxxxxxxx resigns from QLT
as a result of a person other than Xx. Xxxxxxxxxx being appointed as Chief
Executive Officer of QLT ("GOOD REASON"), then, except in the case of Xx.
Xxxxxxxxxx becoming completely disabled (which is provided for in paragraph
5.6) and subject to the provisions set forth below, Xx. Xxxxxxxxxx shall be
entitled to receive notice, pay and/or benefits (or any combination of
notice, pay and/or benefits) as more particularly set out in paragraph 5.3.
5.3 SEVERANCE NOTICE AND PAY - In the event QLT terminates Xx. Xxxxxxxxxx'x
employment as set out in
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paragraph 5.2, Xx. Xxxxxxxxxx shall be entitled to:
(a) NOTICE - Advance written notice of termination ("SEVERANCE NOTICE"), or
pay in lieu thereof ("SEVERANCE PAY"), or any combination of Severance
Notice and Severance Pay, as more particularly set out below:
I. A minimum of eighteen months Severance Notice, or Severance Pay in
lieu thereof, and
II. One additional month's Severance Notice, or Severance Pay in lieu
thereof, for each complete additional year of continuous employment
with QLT commencing on or after September 26, 2006,
up to a maximum total of 24 months' Severance Notice, or Severance Pay
in lieu of Severance Notice. Xx. Xxxxxxxxxx acknowledges and agrees that
Severance Pay is in respect of base salary only and will be made on a
bi-weekly or monthly basis, at QLT's discretion.
(b) BENEFITS - Except as set out below, for 30 days after Xx. Xxxxxxxxxx'x
Last Active Day, all employee benefit plan coverage enjoyed by Xx.
Xxxxxxxxxx and his dependents prior to the date of termination.
Thereafter, and in lieu of employee benefit plan coverage, Xx.
Xxxxxxxxxx shall receive compensation ("BENEFITS COMPENSATION") in the
amount of 10% of his base salary for the balance of his Severance Notice
period. Xx. Xxxxxxxxxx acknowledges and agrees that any pension and
short and long term disability plans provided through QLT will not be
continued beyond Xx. Xxxxxxxxxx'x Last Active Day.
(c) OUT PLACEMENT COUNSELING - QLT will pay to an out placement counseling
service (to be agreed to by Xx. Xxxxxxxxxx and QLT, each acting
reasonably) a maximum of Cdn$5,000 for assistance rendered to Xx.
Xxxxxxxxxx in seeking alternative employment.
(d) OTHER COMPENSATION - QLT will provide the following additional
compensation:
I. QLT will reimburse (in accordance with QLT's Policy and Procedures
Manual, as amended from time to time) Xx. Xxxxxxxxxx for all
reasonable business related promotion, entertainment and/or travel
expenses incurred by Xx. Xxxxxxxxxx on or prior to his Last Active
Day, subject to the expense reimbursement provisions set out in
subparagraph 2.1(c).
II. QLT will make a payment to Xx. Xxxxxxxxxx in respect of his accrued
but unpaid vacation pay to the date of termination of his employment
with QLT.
III. QLT will make a prorated contribution to Xx. Xxxxxxxxxx'x RRSP, the
pro-ration to be with respect to the portion of the current calendar
year worked by Xx. Xxxxxxxxxx and the contribution to be subject to
the conditions set out in subparagraph 2.1(e), except condition III.
IV. QLT will make a prorated payment to Xx. Xxxxxxxxxx in respect of his
entitlement to participate in QLT's Cash Incentive Compensation
Plan, the pro-ration to be with respect to the portion of the
current calendar year worked by Xx. Xxxxxxxxxx and the entitlement
to be at the target level Xx. Xxxxxxxxxx would have otherwise been
eligible to receive in the current calendar year if all corporate,
and, if applicable, individual goals were met but not exceeded
(which target level is currently 50% of his base salary).
V. Xx. Xxxxxxxxxx'x participation in any stock option plan offered by
QLT to its employees shall be in accordance with the terms of the
plan in effect at the time of the stock option offer(s) to Xx.
Xxxxxxxxxx.
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5.4 ACKNOWLEDGEMENT AND RELEASE - Xx. Xxxxxxxxxx acknowledges and agrees that in
the event QLT terminates Xx. Xxxxxxxxxx'x employment as set out in paragraph
5.2, in providing:
(a) The Severance Notice or Severance Pay, or any combination thereof;
(b) The Benefits Compensation;
(c) Out placement counseling service as more particularly set out in
subparagraph 5.3(c); and
(d) The other compensation set out in subparagraph 5.3(d);
QLT shall have no further obligations, statutory or otherwise, to Xx.
Xxxxxxxxxx in respect of this Agreement and Xx. Xxxxxxxxxx'x employment
under this Agreement.
5.5 DUTY TO MITIGATE
(a) DUTY TO MITIGATE - Xx. Xxxxxxxxxx acknowledges and agrees that if his
employment is terminated without cause or he resigns for Good Reason as
set out in paragraph 5.2, his entitlement to Severance Pay, Benefits
Compensation and other compensation as set out in paragraph 5.3 is
subject to his duty to mitigate such payments by looking for and
accepting suitable alternative employment or contract(s) for services.
If Xx. Xxxxxxxxxx obtains new employment or contract(s) for services of
four weeks or longer, Xx. Xxxxxxxxxx agrees that he will notify QLT of
this fact in writing (the "NEW EMPLOYMENT NOTICE") within five working
days of such an occurrence and in this event the following provisions
apply:
I. Xx. Xxxxxxxxxx acknowledges and agrees that his entitlement to
Severance Pay and Benefits Compensation will cease as of the date on
which his new employment or contract for services commences.
II. Within 10 working days of receipt of the New Employment Notice from
Xx. Xxxxxxxxxx, QLT agrees that it will pay Xx. Xxxxxxxxxx a lump sum
amount equivalent to 50% of the Severance Pay and Benefits Compensation
as set out in paragraph 5.3 otherwise owing to Xx. Xxxxxxxxxx for the
balance of the Severance Notice period.
(b) WAIVER OF DUTY TO MITIGATE ON DELIVERY OF RELEASE - In the event that
either on or before the date of termination of Xx. Xxxxxxxxxx'x
employment with QLT or within 30 days after termination of his
employment Xx. Xxxxxxxxxx executes and delivers to QLT a release in the
form set out in Appendix "A" to this Agreement, the provisions of
paragraph 5.5(a) shall be deemed to not apply and Xx. Xxxxxxxxxx shall
have no duty to mitigate nor any reduction in the Severance Pay or
Benefits Compensation in the event that he obtains alternative
employment or contract(s) for service.
5.6 TERMINATION DUE TO INABILITY TO ACT
(a) TERMINATION - QLT may immediately terminate this Agreement by giving
written notice to Xx. Xxxxxxxxxx if he becomes completely disabled
(defined below) to the extent that he cannot perform his duties under
this Agreement either:
I. For a period exceeding six consecutive months, or
II. For a period of 180 days (not necessarily consecutive) occurring
during any period of 365 consecutive days,
and no other reasonable accommodation can be reached between QLT and Xx.
Xxxxxxxxxx. Notwithstanding the foregoing, QLT agrees that it will not
terminate Xx. Xxxxxxxxxx pursuant to this provision unless and until Xx.
Xxxxxxxxxx has been accepted by the insurer for ongoing long-term
disability payments or, alternatively, has been ruled definitively
ineligible for such payments.
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(b) PAYMENTS - In the event of termination of Xx. Xxxxxxxxxx'x employment
with QLT pursuant to the provisions of this paragraph 5.6, QLT agrees to
pay to Xx. Xxxxxxxxxx Severance Pay and Benefits Compensation as set out
in paragraph 5.3 and if Xx. Xxxxxxxxxx ceases to be completely disabled,
then the provisions of paragraph 5.3(c) (out placement counseling) shall
apply.
(c) DEFINITION - The term "completely disabled" as used in this paragraph
5.6 shall mean the inability of Xx. Xxxxxxxxxx to perform the essential
functions of his position under this Agreement by reason of any
incapacity, physical or mental, which the Board, based upon medical
advice or an opinion provided by a licensed physician acceptable to the
Board, determines to keep Xx. Xxxxxxxxxx from satisfactorily performing
any and all essential functions of his position for QLT during the
foreseeable future.
5.7 DEATH - Except as set out below, effective the date of death (the "DATE OF
DEATH") of Xx. Xxxxxxxxxx, this Agreement and both parties' rights and
obligations under this Agreement shall terminate without further notice or
action by either party. Within 30 days after the Date of Death (and the
automatic concurrent termination of this Agreement), QLT shall pay the
following amounts to Xx. Xxxxxxxxxx'x estate:
(a) BASE SALARY - Base salary owing to Xx. Xxxxxxxxxx up to his Date of
Death.
(b) PAYMENT IN LIEU OF BENEFITS - In lieu of employee benefit coverage for
his eligible dependents after his Date of Death, a payment in the amount
of 10% of his annual base salary in effect at his Date of Death.
(c) EXPENSE REIMBURSEMENT - Reimbursement (in accordance with QLT's Policy
and Procedures Manual, as amended from time to time) of all reasonable
business related promotion, entertainment and/or travel expenses
incurred by Xx. Xxxxxxxxxx prior to his Date of Death, subject to the
expense reimbursement provisions set out in subparagraph 2.1(c).
(d) VACATION PAY - Payment in respect of accrued but unpaid vacation pay
owing to Xx. Xxxxxxxxxx as at his Date of Death.
(e) RRSP CONTRIBUTION - A prorated contribution to Xx. Xxxxxxxxxx'x RRSP,
the pro-ration to be with respect to the portion of the current calendar
year worked by Xx. Xxxxxxxxxx and the contribution to be subject to the
conditions set out in subparagraph 2.1(e), except condition III.
(f) BONUS - A prorated payment to Xx. Xxxxxxxxxx in respect of his
entitlement to participate in QLT's Cash Incentive Compensation Plan,
the pro-ration to be with respect to the portion of the current calendar
year worked by Xx. Xxxxxxxxxx and the entitlement to be at the target
level Xx. Xxxxxxxxxx would have otherwise been eligible to receive in
the current calendar year if all corporate, and, if applicable,
individual goals were met but not exceeded (which target level is
currently 50% of his base salary).
After his Date of Death, Xx. Xxxxxxxxxx'x participation and/or entitlement
under any stock option plan offered by QLT to its employees shall be in
accordance with the terms of the plan in effect at the time of the stock
option offer(s) to Xx. Xxxxxxxxxx.
5.8 NO DUPLICATION - In the event that the Severance Pay provisions of this
Agreement and the payment provisions of any other agreement that have been
or may be entered into between QLT and Xx. Xxxxxxxxxx with respect to a
change of control of QLT are both applicable, Xx. Xxxxxxxxxx agrees that he
will give written notice to QLT with respect to which agreement he wishes to
be paid out under and that he is not entitled to severance pay under both
agreements.
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6 CONFLICT OF INTEREST
6.1 AVOID CONFLICT OF INTEREST - Except as set out below, during the term of his
employment with QLT, Xx. Xxxxxxxxxx agrees to conduct himself at all times
so as to avoid any real or apparent conflict of interest with the
activities, policies, operations and interests of QLT. To avoid improper
appearances, Xx. Xxxxxxxxxx agrees that he will not accept any financial
compensation of any kind, nor any special discount or loan from persons,
corporations or organizations having dealings or potential dealings with
QLT, either as a customer or a supplier or a co-venturer. QLT and Xx.
Xxxxxxxxxx acknowledge and agree that from time to time the Board may
consent in writing to activities by Xx. Xxxxxxxxxx which might otherwise
appear to be a real or apparent conflict of interest.
6.2 NO FINANCIAL ADVANTAGE - During the term of his employment with QLT, Xx.
Xxxxxxxxxx agrees that neither he nor any members of his immediate family
will take financial advantage of or benefit financially from information
that is obtained in the course of his employment related duties and
responsibilities unless the information is generally available to the
public.
6.3 COMPLY WITH POLICIES - During the term of his employment with QLT, Xx.
Xxxxxxxxxx agrees to comply with all written policies issued by QLT dealing
with conflicts of interest.
6.4 BREACH EQUALS CAUSE - Xx. Xxxxxxxxxx acknowledges and agrees that breach by
him of the provisions of this Section 6 shall be cause for immediate
termination by QLT of his employment with QLT.
7. CONFIDENTIALITY
7.1 INFORMATION HELD IN TRUST - Xx. Xxxxxxxxxx acknowledges and agrees that all
business and trade secrets, confidential information and knowledge which Xx.
Xxxxxxxxxx acquires during his employment with QLT relating to the business
and affairs of QLT, its affiliates or subsidiaries or to technology,
systems, programs, ideas, products or services which have been or are being
developed or utilized by QLT, its affiliates or subsidiaries or in which
QLT, its affiliates or subsidiaries are or may become interested
(collectively, "CONFIDENTIAL INFORMATION"), shall for all purposes and at
all times, both during the term of Xx. Xxxxxxxxxx'x employment with QLT and
at all times thereafter, be held by Xx. Xxxxxxxxxx in trust for the
exclusive benefit of QLT.
7.2 NON DISCLOSURE - Xx. Xxxxxxxxxx acknowledges and agrees that both during the
term of his employment with QLT and at all times thereafter, without the
express or implied consent of QLT, Xx. Xxxxxxxxxx will not:
(a) DISCLOSE - Disclose to any company, firm or person, other than QLT and
its directors and officers, any of the private affairs of QLT or any
Confidential Information; or
(b) USE - Use any Confidential Information that he may acquire for his own
purposes or for any purposes, other than those of QLT.
7.3 INTELLECTUAL PROPERTY RIGHTS
(a) DISCLOSE INVENTIONS - Xx. Xxxxxxxxxx agrees to promptly disclose to QLT
any and all ideas, developments, designs, articles, inventions,
improvements, discoveries, machines, appliances, processes, methods,
products or the like (collectively, "INVENTIONS") that Xx. Xxxxxxxxxx
may invent, conceive, create, design, develop, prepare, author, produce
or reduce to practice, either solely or jointly with others, in the
course of his employment with QLT.
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(b) INVENTIONS ARE QLT PROPERTY - All Inventions and all other work of Xx.
Xxxxxxxxxx in the course of his employment with QLT shall at all times
and for all purposes be the property of QLT for QLT to use, alter, vary,
adapt and exploit as it shall see fit, and shall be acquired or held by
Xx. Xxxxxxxxxx in a fiduciary capacity solely for the benefit of QLT.
(c) ADDITIONAL REQUIREMENTS - Xx. Xxxxxxxxxx agrees to:
I. Treat all information with respect to Inventions as Confidential
Information.
II. Keep complete and accurate records of Inventions, which records
shall be the property of QLT and copies of which records shall be
maintained at the premises of QLT.
III. Execute all assignments and other documents required to assign and
transfer to QLT (or such other persons as QLT may direct) all right,
title and interest in and to the Inventions and all other work of
Xx. Xxxxxxxxxx in the course of his employment with QLT, and all
writings, drawings, diagrams, photographs, pictures, plans, manuals,
software and other materials, goodwill and ideas relating thereto,
including, but not limited to, all rights to acquire in the name of
QLT or its nominee(s) patents, registration of copyrights, design
patents and registrations, trade marks and other forms of protection
that may be available.
IV. Execute all documents and do all acts reasonably requested by QLT to
give effect to this provision.
7.4 RECORDS - Xx. Xxxxxxxxxx agrees that all records or copies of records
concerning QLT's activities, business interests or investigations made or
received by him during his employment with QLT are and shall remain the
property of QLT. He further agrees to keep such records or copies in the
custody of QLT and subject to its control, and to surrender the same at the
termination of his employment or at any time during his employment at QLT's
request.
7.5 NO USE OF FORMER EMPLOYER'S MATERIALS - Xx. Xxxxxxxxxx certifies that he has
not brought to QLT and will not use while performing his employment duties
for QLT any materials or documents of any former employer which are not
generally available to the public, except if the right to use the materials
or documents has been duly licensed to QLT by the former employer.
8. POST-EMPLOYMENT RESTRICTIONS
8.1 NON-COMPETE - Xx. Xxxxxxxxxx agrees that, by virtue of his senior position
with QLT, he possesses strategic sensitive information concerning the
business of QLT, its affiliates and subsidiaries. As a result, and in
consideration of the payments to be made by QLT to Xx. Xxxxxxxxxx under this
Agreement, without the prior written consent of QLT, for a period of two
years following termination of his employment with QLT for any reason (by
resignation or otherwise), as measured from his Last Active Day, Xx.
Xxxxxxxxxx shall not:
(a) PARTICIPATE IN A COMPETITIVE BUSINESS - Directly or indirectly, own,
manage, operate, join, control or participate in the ownership,
management, operation or control of, or be a director or an employee of,
or a consultant to, any business, firm or corporation that, as a part of
conducting its business, is in any way competitive with QLT or any of
its affiliates or subsidiaries (including, without limitation, QLT USA,
Inc.) with respect to:
I. The development and/or commercialization and/or marketing of
pharmaceutical products that are directly competitive with QLT's
then current commercial products, Visudyne or Eligard or any other
products then being commercialized by or on behalf of QLT or its
affiliates or subsidiaries which individually have worldwide annual
net sales of U.S.$50 million or more in the calendar year preceding
Xx. Xxxxxxxxxx'x Last Active Day,
II. The development and/or commercialization and/or marketing of
light-activated pharmaceutical
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products for photodynamic therapy in the treatment of cancer,
ophthalmic, dermatology, urology and auto-immune disease, or
III. the development and/or commercialization and/or marketing of
pharmaceutical products that are based on a polymer based drug
delivery technology platform and are used in the treatment of
substantially the same medical indications as products which have
become a significant component of QLT's core business or the core
business of any affiliate or subsidiary of QLT,
anywhere in Canada, the United States or Europe.
(b) SOLICIT ON BEHALF OF A COMPETITIVE BUSINESS - Directly or indirectly
call upon or solicit any QLT employee or QLT customer or known
prospective customer of QLT on behalf of any business, firm or
corporation that, as part of conducting its business, is in any way
competitive with QLT with respect to:
I. The development and/or commercialization and/or marketing of
pharmaceutical products that are directly competitive with QLT's
then current commercial products, Visudyne or Eligard or any other
products then being commercialized by or on behalf of QLT or its
affiliates or subsidiaries which individually have worldwide annual
net sales of U.S.$50 million or more in the calendar year preceding
Xx. Xxxxxxxxxx'x Last Active Day,
II. The development and/or commercialization and/or marketing of
light-activated pharmaceutical products for photodynamic therapy in
the treatment of cancer, ophthalmic, urology, dermatology and
auto-immune disease, or
III. the development and/or commercialization and/or marketing of
pharmaceutical products that are based on a polymer based drug
delivery technology platform and are used in the treatment of
substantially the same medical indications as products which have
become a significant component of QLT's core business or the core
business of any affiliate or subsidiary of QLT,
anywhere in Canada, the United States or Europe.
(c) SOLICIT EMPLOYEES - Directly or indirectly solicit any individual to
leave the employment of QLT or any of its affiliates or subsidiaries for
any reason or interfere in any other manner with the employment
relationship existing between QLT, its affiliates or subsidiaries and
its current or prospective employees.
(d) SOLICIT CUSTOMERS - Directly or indirectly induce or attempt to induce
any customer, supplier, distributor, licensee or other business relation
of QLT or its affiliates or subsidiaries to cease doing business with
them or in any way interfere with the existing business relationship
between any such customer, supplier, distributor, licensee or other
business relation and QLT or its affiliates or subsidiaries.
8.2 MINORITY SHARE INTERESTS ALLOWED - The parties agree that nothing contained
in paragraph 8.1 is intended to prohibit Xx. Xxxxxxxxxx from owning less
than 5% of the issued and outstanding stock of any company whose stock or
shares are traded publicly on a recognized exchange.
9. REMEDIES
9.1 IRREPARABLE DAMAGE - Xx. Xxxxxxxxxx acknowledges and agrees that:
(a) BREACH - Any breach of any provision of this Agreement could cause
irreparable damage to QLT;
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and
(b) CONSEQUENCES OF BREACH - In the event of a breach of any provision of
this Agreement by him, QLT shall have, in addition to any and all other
remedies at law or in equity, the right to an injunction, specific
performance or other equitable relief to prevent any violation by him of
any of the provisions of this Agreement including, without limitation,
the provisions of Sections 7 and 8.
9.2 INJUNCTION - In the event of any dispute under Sections 7 and/or 8, Xx.
Xxxxxxxxxx agrees that QLT shall be entitled, without showing actual
damages, to a temporary or permanent injunction restraining his conduct,
pending a determination of such dispute and that no bond or other security
shall be required from QLT in connection therewith.
9.3 ADDITIONAL REMEDIES - Xx. Xxxxxxxxxx acknowledges and agrees that the
remedies of QLT specified in this Agreement are in addition to, and not in
substitution for, any other rights and remedies of QLT at law or in equity
and that all such rights and remedies are cumulative and not alternative or
exclusive of any other rights or remedies and that QLT may have recourse to
any one or more of its available rights and remedies as it shall see fit.
10. GENERAL MATTERS
10.1 TAX WITHHELD - The parties acknowledge and agree that all payments to be
made by QLT to Xx. Xxxxxxxxxx under this Agreement will be subject to QLT's
withholding of applicable withholding taxes.
10.2 INDEPENDENT LEGAL ADVICE - Xx. Xxxxxxxxxx acknowledges that he has obtained
or had the opportunity to obtain independent legal advice with respect to
this Agreement and all of its terms and conditions.
10.3 BINDING AGREEMENT - The parties agree that this Agreement shall enure to
the benefit of and be binding upon each of them and their respective heirs,
executors, successors and assigns.
10.4 GOVERNING LAW - The parties agree that this Agreement shall be governed by
and interpreted in accordance with the laws of the Province of British
Columbia and the laws of Canada applicable to this Agreement. All disputes
arising under this Agreement will be referred to the Courts of the Province
of British Columbia, which will have exclusive jurisdiction, unless there is
mutual agreement to the contrary.
10.5 NOTICE - The parties agree that any notice or other communication required
to be given under this Agreement shall be in writing and shall be delivered
personally or by facsimile transmission to the addresses set forth on page 1
of this Agreement to the attention of the following persons:
(a) IF TO QLT - Attention: Chairman, Fax No. (000) 000-0000,
WITH A COPY TO:
QLT Inc.
000 Xxxxx Xxxxxxxx Xxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx
Attention: Principal Legal Officer
Fax No.: (000) 000-0000
(b) IF TO XX. XXXXXXXXXX - To the address for Xx. Xxxxxxxxxx specified on
page 1 of this Agreement;
or to such other addresses and persons as may from time to time be notified
in writing by the parties.
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Any notice delivered personally shall be deemed to have been given and
received at the time of delivery. Any notice delivered by facsimile
transmission shall be deemed to have been given and received on the next
business day following the date of transmission.
10.6 SURVIVAL OF TERMS
(a) XX. XXXXXXXXXX'X OBLIGATIONS - Xx. Xxxxxxxxxx acknowledges and agrees
that his representations, warranties, covenants, agreements, obligations
and liabilities under any and all of Sections 7, 8 and 10 of this
Agreement shall survive any termination of this Agreement.
(b) COMPANY'S OBLIGATIONS - QLT acknowledges and agrees that its
representations, warranties, covenants, agreements, obligations and
liabilities under any and all of Sections 3, 4, 5 and 10 of this
Agreement shall survive any termination of this Agreement.
(c) WITHOUT PREJUDICE - Any termination of this Agreement shall be without
prejudice to any rights and obligations of the parties arising or
existing up to the effective date of such expiration or termination, or
any remedies of the parties with respect thereto.
10.7 WAIVER - The parties agree that any waiver of any breach or default under
this Agreement shall only be effective if in writing signed by the party
against whom the waiver is sought to be enforced, and no waiver shall be
implied by indulgence, delay or other act, omission or conduct. Any waiver
shall only apply to the specific matter waived and only in the specific
instance in which it is waived.
10.8 ENTIRE AGREEMENT - The parties agree that the provisions contained in this
Agreement, any Stock Option Agreements or agreements relating to a change of
control of QLT entered into between QLT and Xx. Xxxxxxxxxx constitute the
entire agreement between QLT and Xx. Xxxxxxxxxx with respect to the subject
matters hereof and thereof, and supersede all previous communications,
understandings and agreements (whether verbal or written) between QLT and
Xx. Xxxxxxxxxx regarding the subject matters hereof and thereof. QLT and Xx.
Xxxxxxxxxx hereby agree that the employment agreement previously entered
into between them dated August 25, 1998, as amended, is terminated and
replaced by this Agreement. To the extent that there is any conflict between
the provisions of this Agreement and any Stock Option Agreements between QLT
and Xx. Xxxxxxxxxx, the following provisions shall apply:
(a) CHANGE OF CONTROL - If the conflict is with respect to an event,
entitlement or obligation in the case of a Change of Control of QLT (as
defined in any agreement relating to a change of control of QLT entered
into between QLT and Xx. Xxxxxxxxxx), the provisions of that change of
control agreement will govern (unless Xx. Xxxxxxxxxx otherwise elects as
contemplated in paragraph 5.8 of this Agreement).
(b) STOCK OPTIONS - If the conflict is with respect to an entitlement or
obligation with respect to stock options of QLT, the provisions of the
Stock Option Agreements will govern (unless the parties otherwise
mutually agree).
(c) OTHER - In the event of any other conflict, the provisions of this
Agreement will govern (unless the parties otherwise mutually agree).
10.9 SEVERABILITY OF PROVISIONS - If any provision of this Agreement as applied
to either party or to any circumstance is adjudged by a court of competent
jurisdiction to be void or unenforceable for any reason, the invalidity of
that provision shall in no way affect (to the maximum extent permissible by
law):
(a) The application of that provision under circumstances different from
those adjudicated by the court;
(b) The application of any other provision of this Agreement; or
(c) The enforceability or invalidity of this Agreement as a whole.
If any provision of this Agreement becomes or is deemed invalid, illegal or
unenforceable in any jurisdiction by reason of the scope, extent or duration
of its coverage, then the provision shall be deemed amended to the
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extent necessary to conform to applicable law so as to be valid and
enforceable or, if the provision cannot be so amended without materially
altering the intention of the parties, then such provision shall be
stricken and the remainder of this Agreement will continue in full force
and effect.
10.10 CAPTIONS - The parties agree that the captions appearing in this Agreement
have been inserted for reference and as a matter of convenience and in no
way define, limit or enlarge the scope or meaning of this Agreement or any
provision.
10.11 AMENDMENTS - Any amendment to this Agreement shall only be effective if
the amendment is in writing and is signed by QLT and Xx. Xxxxxxxxxx.
IN WITNESS WHEREOF the parties have executed this Agreement as of the day
and year first written above.
QLT INC.
BY: /s/ E. Xxxx Xxxxx /s/ Xxxxxx. X. Xxxxxxxxxx
--------------------- --------------------------
E. XXXX XXXXX XXXXXX X. XXXXXXXXXX
Chairman of the Board
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