EXHIBIT 4.26
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") dated as of December 20, 2000, is
entered into by and between Burleigh Instruments, Inc., a corporation having its
principal place of business at 0000 Xxxx Xxxxxx, Xxxxxxx, Xxx Xxxx 00000-0000,
U.S.A., Fishers, New York, U.S.A. (the "Corporation") and Xxxxx X. Xxxxxxx (the
"Employee").
TERMS OF AGREEMENT
In consideration of this Agreement and the continued employment of the Employee
by the Corporation, the parties agree as follows :
1. EMPLOYMENT
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The Corporation hereby agrees to continue to employ Employee, on a
full-time basis commencing on or about December 20, 2000, to act as
President of the Corporation and to perform such acts and duties and
furnish such services to the Corporation in connection with and related
to that position as is customary for persons with similar positions in
like companies, as the Board of Directors of the Corporation shall from
time to time reasonably direct. Employee hereby accepts said
employment. Employee shall use his best and most diligent efforts to
promote the interests of the Corporation; shall discharge his duties in
a highly competent manner; and shall devote his full business time and
his best business judgement, skill and knowledge to the performance of
his duties and responsibilities hereunder. This Agreement shall not be
interpreted to prohibit Employee from making passive personal
investments or conducting private business affairs if such activities
do not materially interfere with the services required under this
Agreement. Employee shall report to the President of EXFO
Electro-Optical Engineering Inc., the Corporation's holding body
corporate.
2. COMPENSATION AND BENEFITS
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2.1 SALARY
During the term of this Agreement, the Corporation shall pay
Employee the remuneration indicated in Schedule A. The
Employee's remuneration may be adjusted upwards in accordance
with the Corporation's policies and procedures.
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2.2 DISCRETIONARY BONUS
During the term of this Agreement, the Employee may
participate in such bonus plan or plans of the Corporation as
the Board of Directors of the Corporation may approve for the
Employee. Nothing contained in this Section 2.2 shall be
construed to require the Board of Directors to approve a bonus
plan or in any way grant to Employee the right to receive
bonuses not otherwise approved.
2.3 BENEFITS
During the term of this Agreement, the Employee shall receive
such benefits as customarily provided to other officers and
employees of the Corporation. Details of such benefits as of
the date hereof are set forth in Schedule B of this Agreement.
2.4 VACATION
Employee may take paid vacation during each year as set forth
in Schedule A at such times as shall be consistent with the
Corporation's vacation policies and (in the Corporation's
judgement) with the Corporation's vacation schedule for
officers and other employees.
2.5 EXPENSES
Pursuant to the Corporation's customary policies in force at
the time of payment, Employee shall be promptly reimbursed,
against presentation of vouchers or receipts therefor, for all
authorised expenses properly incurred by him on the
Corporation's behalf in the performance of his duties
hereunder.
3. TERMINATION
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3.1 UNDERTAKING BY EMPLOYEE
The Employee hereby undertakes not to voluntarily terminate
his employment with the Corporation for a period of two (2)
years from the date hereof and acknowledges that in the event
that he does so terminate this Agreement, certain penalties
shall be payable by him, as set forth in the Agreement of
Merger and Plan of Reorganization, entered into by the
Employee, the Corporation and certain other parties on
November 4, 2000.
3.2 DISABILITY
If during the term of this Agreement, Employee becomes ill,
disabled or otherwise incapacitated so as to be unable to
perform his usual duties (a) for a period in excess of one
hundred and eighty (180) consecutive days, or (b) for more
than one hundred eighty (180) days in any consecutive twelve
(12) month period and this incapacity has not been remedied by
the end of the twelfth (12th) month of such consecutive
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twelve (12) month period, then the Corporation shall have the
right to terminate this Agreement, subject only to applicable
laws, on thirty (30) day's notice to Employee. Termination
pursuant to this Section 3.1 shall not affect any rights
Employee may otherwise have under any disability insurance
policies in effect at the time of such termination.
3.3 DISCHARGE FOR CAUSE
The Corporation may discharge Employee and terminate his
employment under this Agreement for cause without further
liability to the Corporation by a majority vote of the Board
of Directors of the Corporation except that the Employee, if a
Director, shall not be entitled to vote thereon. As used in
this Section 3.2, "cause" shall mean any or all of the
following;
(a) gross or wilful misconduct of Employee during the
course of his employment;
(b) conviction of any criminal offence involving
dishonesty, breach of trust or moral turpitude during
the term of this Agreement; or
(c) Employee's breach of any of the material terms of
this Agreement.
3.4 TERMINATION WITHOUT CAUSE
Upon thirty (30) days prior written notice, the Corporation
may terminate this Agreement without cause by a majority vote
of the Board of Directors of the Corporation except that the
Employee, if a Director, shall not be entitled to vote
thereon. The Corporation shall incur no liability in this
regard except that it shall continue to pay Employee the
remuneration set forth in Schedule A at his then current rate
for a six (6) month period after termination if termination
shall occur prior to the events mentioned in Section 3.4.
3.5 TERMINATION FOLLOWING MERGER OR ACQUISITION
Notwithstanding Section 3.4, if the Corporation merges or
consolidates with another corporation, if substantially all of
the assets of the Corporation are sold, if a majority of the
outstanding stock of the Corporation is acquired by another
person, or if the control of the Corporation's majority
shareholder changes (a "Triggering Event") and Employee's
employment is subsequently terminated by the Corporation or
surviving entity other than for cause as described in 3.2,
Employee shall be entitled to severance benefits as described
below based on the length of service with the Corporation
since the Triggering Event:
LENGTH OF SERVICE SINCE THE SEVERANCE BENEFITS
TRIGGERING EVENT
0 to 12 months 12 months' remuneration plus
health benefits;
more than 12 months 6 months' remuneration plus
health benefits;
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For purposes of this Section 3.5, Employee shall be entitled
to treat a material demotion in title or function as
termination under this Section 3.5, but only if Employee
expressly so notifies the Corporation and terminates his
employment hereunder within thirty (30) days of such demotion
or relocation. If Employee is offered a substantially similar
position with the surviving entity, Employee's refusal to
accept such position shall not be treated as subject to this
Section 3.5, but rather shall be treated as a voluntary
termination by Employee under Section 3.6.
3.6 VOLUNTARY TERMINATION BY EMPLOYEE
In the event of voluntary termination by Employee after a
period of two (2) years from the date hereof, Employee shall
be entitled only to those amounts that have accrued to the
date of termination in accordance with the terms hereof or are
expressly payable under the terms of the Corporation's
applicable benefit plans or are required by applicable law.
The Corporation may, in its sole and absolute discretion,
confer such other benefits or payments as it determines, but
Employee shall have no entitlement thereto
4. MISCELLANEOUS
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4.1 INSURANCE
The Corporation hereby represents that it is presently the
holder of directors and officers insurance in an amount and
having a coverage that is recommended by its legal advisors
and insurance broker as adequate taking into account the
status of the Corporation, its size and the nature of its
activities. The Corporation undertakes to ensure that such
insurance shall remain in force throughout the term of this
Agreement and in the event such insurance is cancelled, the
Corporation shall immediately advise the Employee in writing.
4.2 ADDITIONAL AGREEMENTS
Upon execution of this Agreement, the Employee shall execute
and deliver to the Corporation, unless previously delivered,
an Exclusivity, Confidentiality, Assignment of Work Product,
Non-Competition and Non-Solicitation Agreement.
4.3 NOTICES
Any notice or communication given by any party hereto to the
other party shall be in writing and personally delivered or
mailed by certified mail, return receipt requested, postage
prepaid, to the addresses provided above. All notices shall be
deemed given when actually received. Any person entitled to
receive notice (or a copy thereof) may designate in writing,
by notice to the others, such other address to which notices
to such person shall thereafter be sent.
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4.4 ENTIRE AGREEMENT
This Agreement contains the entire understanding of the
parties in respect of its subject matter and supersedes all
prior agreements and understandings between the parties with
respect to such subject matter, provided, however that nothing
in this Agreement shall affect the Employee's obligations
under the Exclusivity, Confidentiality, Assignment Of Work
Product, Non-Competition And Non-Solicitation Agreement signed
by the Employee.
4.5 AMENDMENT WAIVER
This Agreement may not be amended, supplemented, cancelled or
discharged, except by written instrument executed by the party
affected thereby. No failure to exercise, and no delay in
exercising, any right, power or privilege hereunder shall
operate as a waiver thereof. No waiver of any breach of any
provision of this Agreement shall be deemed to be a waiver of
any preceding or succeeding breach of the same or any other
provision.
4.6 BINDING EFFECT, ASSIGNMENT
Employee's rights or obligations under this Agreement may not
be assigned by Employee. The rights and obligations set forth
in this Agreement shall bind and inure to the benefit of the
Corporation and its successors and assigns. The Corporation
will use its best efforts to require any successor (whether
direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or
assets of the Corporation to assume expressly and agree to
perform this Agreement in the same manner and to the same
extent that the Corporation would be required to perform it as
if no such event had taken place. As used in this Agreement,
"Corporation" shall mean the Corporation as herein before
defined any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement
by operation of law, or otherwise.
4.7 HEADINGS
The headings contained in this Agreement are for reference
purposes only and shall not affect the meaning or
interpretation of this Agreement.
4.8 GOVERNING LAW, INTERPRETATION
This Agreement shall be construed in accordance with and
governed for all purposes by the laws applicable in the State
of New York. Service of process in any dispute shall be
effective (a) upon the Corporation, if service is made on any
officer of the Corporation other than the Employee; (b) upon
the Employee, if served at Employee's residence last known to
the Corporation with an information copy to the Employee at
any other residence, or care of a subsequent employer, of
which the Corporation may be aware.
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4.9 FURTHER ASSURANCES
Each of the parties agrees to execute, acknowledge, deliver
and perform, or cause to be executed, acknowledged, delivered
and performed at any time, or from time to time, as the case
may be, all such further acts, deeds, assignments, transfers,
conveyances, powers of attorney and assurances as may be
necessary or proper to carry out the provisions or intent of
this Agreement.
4.10 SEVERABILITY
If any one or more of the terms, provisions, covenants or
restrictions of this Agreement shall be determined by a court
of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected,
impaired or invalidated.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
BURLEIGH INSTRUMENTS, INC.
BY: /s/ Xxxxxxx Xxxxxxx /s/ Xxxxx X. Xxxxxxx
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XXXXXXX XXXXXXX, XXXXX X. XXXXXXX
CHAIRMAN OF THE BOARD
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SCHEDULE A
TO
XXXXX X. XXXXXXX EMPLOYMENT AGREEMENT
REMUNERATION AND VACATION
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1. REMUNERATION
Base Salary: US$184,500 annually.
Variable Remuneration: The parties will agree on a plan for variable
remuneration on or before February 1, 2001 that is reasonably
consistent with plans utilized for employees of the Corporation's
parent company with similar positions or responsibilities.
On the date of this Agreement, Employee will be granted 40,000 stock
options under the Stock Option Plan of EXFO Electro-Optical Engineering
Inc.
2. VACATION
Five (5) weeks of paid vacation annually.
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SCHEDULE B
TO
XXXXX X. XXXXXXX EMPLOYMENT AGREEMENT
BENEFITS
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The Employee shall be entitled to the following benefits, in addition
to those that the Corporation presently offers to all of its employees.
o A monthly allocation of $US650.00for automobile expenses.
o Reimbursement of legal expenses incurred for tax returns, tax
planning, xxxxx, house closings, etc. related to the
Corporation's status as an "S" corporation.
o Payment of the premiums of an executive life insurance policy
in the amount of US$511,000.
o Medical reimbursement in accordance with the same terms that
applied prior to the acquisition by EXFO Electro-Optical
Engineering Inc.
o Reimbursement of the cost of a yearly physical examination.
o Disability insurance in amounts presently maintained by the
Corporation for the Employee.
o Sick pay benefits in accordance with the Corporation's
procedures for a term of up to one (1) year.
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