EXHIBIT 10.15
EMPLOYMENT AGREEMENT
THIS AGREEMENT made the 17th day of June 2005.
BETWEEN:
FREE DA CONNECTION SERVICES INC., a Delaware Corporation
Having it registered and records office at
Xxxxxx Law Group, 0000 Xxxx Xxxxxxxxx Xxxxx
Xxxxxxx, XX 00000 XXX.
(hereafter called "Free DA USA") AND:
FREE DA CONNECTION SERVICES INC., a British Columbia
Corporation having its registered and records office at
Suite 301 - 0000 Xxx Xxx Xxxxxx,
Xxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
(hereafter called the "EMPLOYER")
OF THE FIRST PART
AND:
MR, XXXX XXXXXXXXXX, an individual
residing at 00000, 00xx Xxx., Xxxxxx,
Xxxxxxx Xxxxxxxx, X0X 0X0
(hereafter called the "EMPLOYEE")
OF THE SECOND PART
WHEREAS, Free DA USA is the parent company of the Employer and owns (100%)
one hundred percent of the capital of the Employer and herein agrees to be bound
by the terms and conditions of this agreement in its entirety.
WHEREAS, pursuant to this Agreement, the Employee is to be employed by the
Employer in a position of trust and confidence and under conditions where he has
or may have access to technical, confidential and secret information regarding
the business of the Employer;
AND WHEREAS the Employee recognizes that as part of the duties of his
employment, all ideas and suggestions of interest to the Employer as they relate
to the Technology as defined in the IP Purchase and Sale Agreement - Free DA
between Employer and 668158 B.C. Ltd. (the "IP Purchase and Sale Agreement"),
conceived or made by him while he is employed by the Employer shall be
immediately communicated to and made available to the Employer;
AND WHEREAS the Employee may be trained by the Employer in connection with
the business and through such training or otherwise during his employment the
Employee may acquire or create knowledge, experience and expertise, as well as
detailed knowledge of the Employer's confidential customer and supplier lists
and information, marketing and production techniques, price lists, trade secrets
and other proprietary intellectual property, all of which the
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Employee acknowledges is and shall be the property of the Employer, the
disclosure, loss or unauthorized use of which would substantially harm the
business of the Employer;
AND WHEREAS the Employee may create, develop or invent intellectual
property, trade secrets, designs or other inventions during the course of his
employment; which property, whether capable of protection under patent,
copyright, industrial design or other intellectual property laws, is intended to
be and shall be the sole and exclusive property of the Employer;
AND WHEREAS the Employee acknowledges that the Employer is relying upon the
representations, conditions, warranties or other terms of this Agreement made by
the Employee herein as well as the full and proper performance of the
obligations of the Employee hereunder in consideration for the employment of the
Employee:
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the respective
covenants and agreements of the parties contained herein, the sum of one dollar
paid by each to the other and other good an valuable consideration (the receipt
and sufficiency of which is hereby acknowledged by each of the parties hereto),
it is agreed as follows:
CLAUSE 1 - AGREEMENT
--------------------
1.1 TERMINATION OF PRIOR AGREEMENTS: This Employment Agreement, from and
after the date it is effective, supercedes and takes the place of any other
contract of the same nature, including any consulting agreements, heretofore
existing between the parties.
CLAUSE 2 - EMPLOYMENT
---------------------
2.1 EMPLOYMENT: Subject to the terms and conditions contained herein, the
Employer agrees to employ the Employee and the Employee agrees to be employed by
the Employer in its business and will have the title of Chief Scientist; unless
and until the Employer may change such title, designation or duties of the
Employee. The term of the employment shall be (3) three years, exclusive of the
provisions in section, 3.11 which shall have a term of (10) ten years.
2.2 CONFORM WITH DIRECTIONS AND POLICIES: During his employment with the
Employer, the Employee shall in all respects conform to and comply with the
directions and policies of the Employer, perform each of the duties assigned
from time to time by the Employer to the best of his skill and ability,
faithfully and diligently serve the Employer, use his best efforts to promote
the interests and reputation of the Employer and, unless separately provided in
Schedule A to this Agreement, devote his full-time energy, attention and
energies to the business of the Employer.
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2.3 The Employee's employment may be terminated:
(a) by the Employer
(i) for just cause at any time by the Employer without notice and without
any payment in lieu of notice. The effective date of termination may be the
date that such cause occurred. "JUST CAUSE" includes, without limitation, any
misconduct by the Employee, any wilful breach or non-observance by him of any of
the conditions or obligations of this Agreement, any neglect or refusal by him
to carry out any his duties hereunder, any negligent performance of such duties,
any insubordinate or insulting behaviour towards the Employer, its officers and
clients, use of illegal drugs, showing up for work while intoxicated as defined
under the criminal code of Canada; or
(ii) without cause, upon giving three months notice after one year of
service but prior to the Employee's third year of employment and subsequent to
the third year of employment, not less than three months notice, and thereafter,
an additional period of notice of one month for each additional completed year
of employment, up to a maximum of six months notice; provided that, if by reason
of any change in the statute law of the jurisdiction governing this Agreement,
the minimum period of notice required by law should exceed the notice set forth
in this paragraph, then the greater notice so required shall apply;
and the Employee hereby waives any claim to further notice or compensation
exclusive of the provision in 3.11 below, and the Employee agrees that the
foregoing notice period(s) are deemed conclusively to be reasonable notice of
termination.
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(b) by the Employee, upon the Employee giving the Employer, at any time, 60
days written notice.
In the event that the Employer or the Employee may terminate this Agreement,
except for Just Cause as hereinbefore defined, the Employer may in its absolute
discretion determine that the Employee be released from work obligations
immediately upon the giving of notice. In such event, the Employer shall pay to
the Employee during the period of notice that would otherwise have been worked
by the Employee, the amount of salary and benefits, except those benefits
provided for work purposes (such as an automobile allowance, expense account or
the like), upon the same frequency and in the same manner as if the Employee had
remained employed. The Employee shall be obligated to disclose to the Employer
all income which the Employee receives during the period of notice, and such
amount shall be deducted from the Employer's obligations during the period of
notice. In its absolute discretion, the Employer may determine to make payment
to the Employee of the entire amount of the compensation to be paid in lieu of
notice in a single lump sum payment. This payment shall be exclusive of section
3.11 which shall continue in any event for a period of (10) ten years.
2.4 EMPLOYEE NOT TO ENGAGE IN OTHER EMPLOYMENT: The Employee agrees not to
engage or have an interest in, directly or indirectly, any other business or
employment that is deemed to be Competitive to the Employer's business, during
the term of this employment, save and except with the express written permission
of the Employer, given in writing or as may be set forth on Schedule A to this
Agreement.
CLAUSE 3 -REMUNERATION AND BENEFITS
-----------------------------------
3.1 REMUNERATION: During the Employee's employment with the Employer, the
Employee shall be entitled to receive the following remuneration:
(a) as soon as Employee has received five hundred thousand dollars (US
$500,000.00) in equity or debt financing, and no later than six months from the
date of this Agreement, but earlier if mutually agreed to by the parties, the
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Employee shall be put on the Canadian payroll of the Employer at a base salary
of $120,000, less statutory deductions, paid bi-monthly, in equal instalments on
the 15th and last day of each and every month;
(b) until such time as the Employee is added to the Canadian Payroll, the
Employer agree to retain the Employee on a work for hire basis, at a consulting
rate of $6,000.00 per month paid bi-monthly on the 15th and 30th.
(c) the employee will be entitled to purchase 350,000 warrants in the
company at a price of $0.01 per shares. The warrants will vest each quarter
over a two year period and all warrants will expire five years from the date of
this agreement. All warrants will fully vest either at the end of year two or
the date of termination should this Agreement be terminated by the Employer for
any reason (either with or without cause), whichever is earlier. Should the
Employee terminate the agreement, vesting will cease at that moment;
(d) in addition to warrants described in 3.1(c), the employee will be
delivered 300,000 purchase warrants at a price of $0.01 per shares that vest on
the effective date of this agreement. The employee has indicated to the
Employer that he wishes to provide these warrants to certain nominees. The
Employee shall instruct in writing the Employer to provide the warrant
distribution to the Employee's nominees; and
(e) such further and other remuneration as the Employee and the Employer may
agree to in writing from time to time.
3.2 NO RIGHT TO XXX: The Employee shall have no further right to xxx the
Employer for damages or additional wages or benefits other than as set out in
this Agreement, exclusive of any right under the IP Purchase and Sale Agreement.
3.3 ADJUSTMENT OF REMUNERATION: The Employer and the Employee may from time
to time, by mutual written agreement, adjust the amount of the salary referred
to in clause 3.1 hereof without changing the interpretation of any of the other
provisions of this Agreement.
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3.4 REDEFINITION OF EMPLOYMENT: The Employer may from time to time redefine
the job title, description, place of employment, functions or responsibilities,
or any of them, of the Employee, without changing any of the rights or
obligations of the parties hereto.
3.5 REIMBURSEMENT OF EXPENSES: The Employee shall be reimbursed by the
Employer for all business expenses actually and properly incurred by the
Employee in connection with his duties under this Agreement in accordance with
the normal policy of the Employer. The reimbursement of expenses shall be
subject to the provision by the Employee to the Employer of receipts, statements
and vouchers to the satisfaction of the Employer consistent with that policy.
Expenses incurred by the Employee not in accordance with the policy of the
Employer shall be for the sole expense of the Employee.
3.6 BENEFITS: The Employer will make available to the Employee the
benefits, in its sole discretion; it makes available to other employees from
time to time, and shall provide the Employee with written notice and disclosure
thereof.
3.7 BONUS: In addition to the salary described in clause 3.1 (a) above,
the Employee shall be entitled to consideration for bonuses from time to time as
allocated and approved by the board of directors of the Employer. Further, the
Employee will participate in the Executive Bonus Program to be approved the
Board of Directors of the Employer. The Employee understands and agrees that
the amount of such bonus, entitlement to and payment of any bonuses is entirely
within the sole and arbitrary discretion of the Employer. In the event that
this Agreement and the Employee's employment hereunder is terminated by either
party for any reason whatsoever, no bonus shall be payable to the Employee
except any bonus previously awarded that remains unpaid, and only to the extent
that such bonus is unpaid.
3.8 CAR ALLOWANCE: The Employer may, in its absolute discretion, provide to
the Employee an allowance for the operation of an automobile where such
automobile expenses are reasonably utilized in the performance of the Employee's
duties as an employee under this Agreement. For the term of this agreement the
Employer will pay to the Employee the sum of $0.50 per
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kilometre, or in accordance to expenses equally provided to the Chief Executive
Officer of the Employer.
3.9 CELLULAR PHONE: The Employer, in its absolute discretion, may elect to
provide to the Employee an allowance of $ 450.00 per month towards the costs and
charges which may be incurred by an employee as a result of the use of a
cellular telephone where the same can reasonably be required for the performance
of the Employee's duties. Alternatively, the Employer may elect to provide the
Employee with a cellular telephone and a subscription for the service of such
phone, in which event the Employee shall reimburse the Employer for all costs of
a personal nature incurred in the service contract for such telephone. In the
event that the Employer provides the Employee with such telephone and telephone
subscription service, the Employee shall deliver up all billing records of the
telephone to the Employer, and the Employer shall be entitled to rely upon them
for the purposes of this Agreement.
3.10 NO PROVISION FOR TAXABLE BENEFIT: The Employer shall not be obliged to
reimburse or otherwise make allowance to the Employee in respect of any deemed
benefit or income for income tax purposes as a result of the provision to and
use by the Employee of any benefit or allowance provided by the Employer to the
Employee.
3.11 ALLOWANCE; For a period of (10) ten years the Employer, it heirs or
successors, shall pay to the Employee whether he is employed or not employed by
the company an allowance as follows:
(a) Once the Employer has paid the consideration due and owing under the IP
Purchase and Sale Agreement entered into between the Employer and 668158 BC
Ltd., the Employees private company, the Employer will pay the Employee or his
nominee an allowance in the amount of two and a half percent (2.5%) on the gross
revenue of the Employer or its parent Free DA USA up to a cumulative gross
revenue of $400 million US dollars as reported in the Annual 10-KSB filings to
the Securities Exchange Commission of Free DA USA.
(b) On payment of US $500,000 by Employer to 668158 BC Ltd. Pursuant to the IP
Purchase and Sale Agreement or on termination of the IP Purchase and Sale
Agreement, whichever occurs earlier, Employer shall pay a minimum annual payment
allowance to Employee or his nominees
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under sections 3.11(a) of US $25,000 Dollars paid within 10 days of acceptance
of the annual form 10-KSB by the Securities Exchange Commission, and such
minimum payment shall continue for a total period of ten (10) years from the
date of this Agreement. Once the Employer or its parent Free DA USA has paid
the Employee a two and a half percent (2.5%) allowance on a cumulative gross
revenue of $400 million US Dollars of sales, the annual allowance paid to the
Employee by the Employer or its parent Free DA USA shall be reduced from two
point five percent (2.5%) to one percent (1%) of annual gross revenue as
reported on the 10-KSB filings for any subsequent periods totalling a combined
(10) year period. Said allowance shall terminate at the conclusion of the
fiscal period June 30th, 2015. Said allowances during the (10) year period may
not be cancelled by the Employer or its parent Free DA USA for any reason except
in the event that all or substantially all of the assets of the Employer or Free
DA USA are sold. Should such an event take place, the Employer must immediately
within (10) days of closing such transaction pay the Employee the difference
between the total allowances paid to the Employee and fees paid to 66815 BC LTD
under the provisions of the IP Purchase and Sale Agreement, to that date and the
sum of $9,800,000 US.
(d) Once the Employer has paid to the Employee or his nominee an aggregate
allowance totalling $500,000.00 USD, from any form of allowance, or payments
made to 668158 BC LTD the Employee being the sole Director of 668158 BC LTD
shall cause 668158 BC LTD to deliver to the Employer any and all security
interest that it may hold in intellectual property related to the the Field (as
defined in the IP Purchase and Sale Agreement, hereto attached).
(e) Employer will pay the allowance pursuant to 3.11(a) quarterly to Employee,
or its nominee, within 30 days from submitting its quarterly filings with the
SEC. All allowances paid to the employee will be paid on gross cash receipts,
such receipts not to be unreasonably deferred. Such allowance will be adjusted
at Employer's fiscal year end pursuant to Employer's Annual 10-KSB filing.
CLAUSE 4 -VACATION
------------------
4.1 VACATION ENTITLEMENT: The Employee shall be entitled to four weeks of
vacation, with pay, during each of the first and second years of employment, to
be taken in accordance with company policy. After the expiration of two
completed years of employment, the Employee shall
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be entitled to five weeks of vacation, with pay, in each year, to be taken as
per company policy. After the expiration of six years of completed employment,
the Employee shall be entitled to six weeks of vacation with pay in each year,
to be taken as per company policy.
CLAUSE 5 - EMPLOYEE COVENANTS NON-COMPETITION
---------------------------------------------
5.1 NON-COMPETITION: The Employee agrees that it will not, without the
Consent of the Employer, directly or indirectly, either as principal, agent,
employee, employer, stockholder, partner or in any other capacity, manufacture,
market or sell or assist any other person, firm or corporation to manufacture,
market or sell any service that, in the opinion of the Employer acting
reasonably, competes with the Technology as defined in the IP Purchase and Sale
Agreement, or the business of the Employer, during the term of this Agreement
and for 12 calendar months after the termination of this Agreement, only if this
Agreement is not breached by Employer. If the Employee is terminated without
cause non-compete period will be reduced to 6 calendar months. This section 5.1
will not apply to Employee if Employer is in breach of any of its obligations
pursuant to this Agreement.
5.2 CONFIDENTIALITY: The Employee acknowledges that any information which
may reasonably be described by the Employer as "secret" includes and means
information known or used by the Employer in connection with its business,
including but not limited to customer lists and information, financial
information, marketing information, business opportunities, technology, research
and development and information relating to the Employer's intellectual
property, and includes other information received from others that the Employer
may be required to keep confidential. The Employee agrees that he will hold in
confidence, as the Employer's fiduciary, and keep confidential during and after
the term of his employment, all of the secret information or secrets which at
any time become known to him, unless and until such secret information or
secrets are generally available to the public through no breach of this
Agreement.
5.3 The Employee will only use such secret information or secrets for the
benefit of the Employer. The Employee will ensure that all items that come into
his possession which contain any of the secret information or secrets are marked
with prominent confidentiality notices acceptable to the Employer. All tangible
items embodying or disclosing any portion of the secret
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information or secrets will be dealt with in accordance with the provisions set
out above concerning documents and materials.
5.4 The Employee specifically acknowledges that any violation of the
provisions of this clause will cause irreparable injury to the Employer, and the
Employer will be entitled, in addition to any other rights and remedies it may
have, to injunctive relief against the Employee.
5.5 The Employee acknowledges and agrees that the restrictions of this
clause are necessary and fundamental to the protection of the Employer and its
business interests, and each is reasonable and valid, and they are,
collectively, reasonable and valid, and the Employee specifically waives all
defences to the strict enforcement of these provisions.
CLAUSE 6 - EMPLOYEE COVENANTS
-----------------------------
6.1 COVENANTS OF THE EMPLOYEE: The Employee covenants both during and
after employment with the Employer as follows:
(a) that, except in fulfilment of his duties hereunder, he shall not enter
into any contract on behalf of, or in the name of, the Employer and shall not
pledge the credit of the Employer;
(b) that he shall not at any time be guilty of any act or conduct causing or
calculated to cause damage or discredit to the reputation or business of the
Employer;
(c) that he shall not at any time during his employment with the Employer or
after the termination thereof take any steps or make any approach, either
directly or indirectly, to any employee of the Employer calculated to lead to
such employee leaving his or her employment;
(d) that as soon as notice of termination of employment has been given by
either party and/or his employment shall terminate, whichever is the earlier, he
shall deliver up to the Employer all books, records, printouts, lists, notes and
other documents or copies thereof owned by the Employer or that Employer owns
the
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intellectual property in. which may be in his possession or directly or
indirectly under his control;
(e) that he shall not at any time during or after employment use for his own
interest, and shall not release directly or indirectly to anyone any information
concerning the Employer's business practices, operations, procedures, policies,
budget, products, financial information, client names, suppliers or the like,
which the Employer shall deem confidential or against its business interests;
and
(f) the Employee further acknowledges that the information found in the
Employer's books, records, printouts, lists, notes or any other documents or
copies thereof developed, created or conceived in the course of Employee's
duties as directed by Employer, or using Employer's materials, or otherwise
owned by Employer is the exclusive property of the Employer and can only be used
for the benefit of the Employer.
6.2 DEVELOPMENT OF INTELLECTUAL PROPERTY: The Employee covenants that
during employment with the Employer that it is a term of his employment that he
may, from time to time, be involved in the creation of Improvements, as defined
in the IP Purchase and Sale Agreement; and may be involved in developments or
inventions, idea trade secrets, designs or other intellectual property pursuant
to the business of the Employer and that all such Improvements developed by the
Employee or in which development the Employee participates during the term of
his employment, wheresoever or howsoever such development may occur, shall be
the sole and exclusive property of the Employer; and the Employee specifically
waives any entitlement to ownership or an ownership interest in the said
intellectual property. Notwithstanding the foregoing, certain intellectual
property and the creation of it may give rise to moral rights of the Employee
which, pursuant to the law of the jurisdiction in which the Employee may be
located, may not be transferable or assignable to the Employer. To the extent
that such moral rights are not assignable, the Employee specifically agrees that
he hereby waives any and all entitlement to such moral rights and that he will
take no action of any kind, both during his employment and thereafter, for the
enforcement of such moral rights against the Employer or the interests of the
Employer's business.
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CLAUSE 7 - GENERAL CONTRACT PROVISIONS
--------------------------------------
7.1 GOVERNING LAW: The terms of this Agreement are governed under the laws
of the Province of British Columbia, and of Canada, and is under such laws to be
considered a contract of employment.
7.2 NO RELATED PARTY DEALINGS: The Employee shall not be allowed to deal on
behalf of the Employer with any company in which he or his immediate family has
an undisclosed financial interest, exclusive of 668158 BC LTD.
7.3 NOTICE: Any notice to be given by either party hereunder may be validly
given if sent by registered mail, postage prepaid, addressed to the other at the
address set forth above, and such notice shall be deemed to have been received
if sent by registered mail on the third business day after the date of mailing.
Alternatively, such notice may be given personally, and it shall be deemed to
have been received on the date of its receipt.
7.4 SURVIVAL: Clause 3.11 and the representations, warranties and covenants
of the Employee contained in this Agreement shall survive any termination of the
Employee's employment with the Employer.
7.5 INJUNCTIVE RELIEF AND DAMAGES: The Employee agrees that in the event of
any breach of this Agreement by the Employee, damages may not be an adequate
remedy and that the Employer will be entitled to make application to a court of
competent jurisdiction for temporary or permanent injunctive relief against the
Employee, without the necessity of proving actual damage to the Employer.
7.6 SEVERABILITY: If any covenant or provision contained herein is
determined to be void, invalid or unenforceable, in whole or in part, for any
reason whatsoever, it shall not be deemed to affect or impair the validity or
enforceability of any other covenant or provisions hereof, and such
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unenforceable covenant or provisions or part thereof shall be treated as
severable from the remainder of this Agreement.
7.7 NO UNTRUTHS: The Employee represents and warrants that all information
provided to the Employer in any application form or during any interview for
employment was and remains accurate and contains no untruths or
misrepresentations. The Employee agrees that the provision of any false or
misleading information on an application form or during any employment interview
or in respect of any employment disciplinary matter during the employment are
grounds for immediate dismissal of the Employee by the Employer, as Just Cause,
without any further compensation payable to the Employee.
CLAUSE 8 - JOB DESCRIPTION
--------------------------
8.1 JOB DESCRIPTION: The Employee acknowledges that he has been hired to
perform the job description set out as Schedule B to this Agreement. The
Employee specifically acknowledges that, from time to time, the nature of the
Employer's business may require the Employer, acting reasonably, to alter the
job description and requirements of employment by the Employee. Such alteration
may require the Employee to perform differing duties from those of the original
employment description contained in Schedule B, to relocate and to take up
residence elsewhere than where the Employee may be residing at the commencement
of the employment, and to accept a position within the structure of the
Employer's business differing in title and status from that of the initial
employment. The Employer shall be entitled, acting reasonably, to exercise its
management discretion to make such changes to the employment as in its absolute
discretion it deems necessary for the business.
8.2 ENTIRE AGREEMENT: This Agreement and any schedules attached hereto
constitutes the whole of the agreement between the parties. There are no
collateral representations, agreements or conditions not specifically set forth
herein. The Employee acknowledges that any express representations not
contained in this Agreement, made negligently, innocently or otherwise to the
Employee by the officers, directors, employees or agents of the Employer,
whether acting with actual or ostensible authority or otherwise, and whether
such representations are made prior to, on or subsequent to the date hereof,
have been, are or shall be so made without responsibility on the part of the
Employer, its officers, directors, employees or agents, for any tortious
liability,
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economic losses, non-pecuniary losses or other damages. The Employee also
further acknowledges and agrees that any representation that may by implication
arise as a result of the past, present or future interactions of the Employer
and the Employee, shall not attribute or import any tortious liability to the
Employer, its officers, directors, employees or agents.
8.3 AMENDMENTS: No modification, amendment or variation hereof shall be of
effect or binding upon the parties hereto unless agreed to in writing by each of
them, and thereafter such modification, amendment or variation shall have the
same effect as if it had originally formed part of this Agreement.
8.4 ENUREMENT: This Agreement shall enure to the benefit of and be binding
upon the parties hereto, and their respective legal personal representatives,
heirs, executors, administrators or successors.
8.5 ASSIGNMENT: This Agreement is personal to the Employee and may not be
assigned by the Employee.
8.6 WAIVER: No waiver by the parties hereto of any breach of any condition,
covenant or agreement hereof shall constitute a waiver of such condition,
covenant or agreement except in respect of the particular breach giving rise to
such waiver.
8.7 EMPLOYEE'S ACKNOWLEDGEMENT: The Employee acknowledges that he has read
and understands the foregoing, and that the Employer has advised him that this
Agreement substantially alters and supercedes the Employee's rights at common
law. The Employee specifically acknowledges that the Employer has advised him
to seek independent legal advice prior to executing this Agreement.
8.8 TRANSMISSION BY FACSIMILE: The parties hereto agree that this Agreement
may be transmitted by facsimile or such similar device, and the reproduction of
signatures by facsimile or such similar device will be treated as binding as if
originals, and each party hereto undertakes to provide each and every other
party hereto with a copy of the agreement bearing original signatures forthwith
upon demand.
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8.9 TERMINATION IN THE EVENT OF CHANGE OF CONTROL: Notwithstanding the
provisions of this Agreement hereinbefore set out in respect of termination of
the Employee, in the event that, by reason of change of control of the Employer,
as hereinafter defined, the Employee may be terminated and, upon termination,
the Employee shall be entitled to be paid, in lieu of notice, a sum equal to
twice the payment to which the Employee would have been entitled if the
termination had been for otherwise than for Just Cause, exclusive of any
commission owing under this agreement.
8.10 In the event of such termination by reason of change of control, the
following provisions shall apply:
(a) the Employee shall be deemed to have been granted and available for
immediate exercise any options, rights, warrants or other entitlements issued by
the Employer or any affiliate of it for the purchase or acquisition of shares in
the capital of the Employer or any affiliate thereof, whether or not such
options, rights, warrants or other entitlements may then be exercised, provided
that any options, rights, warrants or other entitlements which are required to
be exercised upon notice after being available to the Employee, they shall be
exercised within a period of not less than three months of the date of
termination or shall lapse and be void and of no further force and effect;
(b) the Employer will not seek in any way to amend the term of any loans
from the Employer to the Employee;
(c) if, at the date of termination by reason of change of control, the
Employee holds any membership in any clubs, social or athletic associations paid
for by the Employer that were for the Employee's regular use, the Employer will
not take any action to terminate such memberships but will not renew such
memberships that expire or make any payment in respect of such memberships in
support of the Employee for the period after the date of termination by reason
of change of control;
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(d) notwithstanding any other provision in this Agreement, to the extent it
is able to do so, the Employer will maintain for a period of six months after
the date of termination by reason of change of control all group medical and
insurance benefits that the Employee was entitled to receive immediately prior
to the date of such termination; and
(e) the Employer will pay to the Employee all outstanding and accrued
regular and special vacation pay to the date of termination by reason of change
of control.
8.11 Change in control shall mean, for the purposes of this clause, any one
of the following:
(a) the acquisition or continuing ownership by any person or persons acting
jointly or in concert, directly or indirectly, of common shares or of
convertible securities which, when added to all of the securities of the
Employer at the time held by such person or persons, or persons associated or
affiliated with such person or persons within the meaning of the Canada Business
Corporations Act (collectively, the "ACQUIRORS"), and assuming the conversion,
exchange or exercise of convertible securities beneficially owned by the
Acquirors, results in the Acquirors beneficially owning shares that would,
notwithstanding any agreement to the contrary, entitle the voters thereof for
the first time to cast more than 51% of the votes attaching to all shares in the
capital of the Employer that may be cast to elect directors;
(b) the exercise of the voting power of all or any shares of the Employer so
as to cause or result in the election of a majority of directors of the Employer
who were not incumbent directors;
(c) the sale, lease, exchange or other disposition of all or substantially
all of the Employer's assets; or
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(d) an amalgamation, merger, arrangement or other business combination
involving the Employer that results in the securityholders of the parties to the
business combination other than the Employer owning, directly or indirectly,
shares of the continuing entity that entitle the holders thereof to cast more
than 50% of the votes attaching to all shares in the capital of the continuing
entity that may be cast to elect directors.
8.12 A termination by reason of change of control shall mean a termination
which occurs within the first anniversary of the event constituting the change
of control and that is other than for Just Cause and conducted for the purposes
of reorganization of the Employer by reason of the change of control.
8.13 In this Agreement the use of the singular shall mean the plural and of
the masculine shall mean the feminine, as the case may be, where the same is
necessary to give effect to and make reasonable the terms of this Agreement.
17
IN WITNESS WHEREOF the parties hereto have duly executed this Employment
Agreement effective the day and date first above written.
)
)
SIGNED AND DELIVERED on behalf of the Employer)
FREE DA CONNECTION SERVICES INC. )
) FREE DA CONNECTION SERVICES INC.
by its duly authorized signatory ) Per:
in the presence of )
--------------------------------- --------------------------------
Witness DULY AUTHORIZED SIGNATORY
)
)
SIGNED AND DELIVERED on behalf of Free DA USA )
FREE DA CONNECTION SERVICES INC. )
) FREE DA CONNECTION SERVICES INC.
by its duly authorized signatory ) Per:
in the presence of )
--------------------------------- --------------------------------
Witness DULY AUTHORIZED SIGNATORY
SIGNED, SEALED AND DELIVERED by
THE EMPLOYEE
in the presence of
--------------------------------- --------------------------------
Witness EMPLOYEE
18
