Exhibit 3(13)
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made and entered into as of this
3rd day of August, 1998 by and between XENOTECH, INC., a Canadian corporation
(the "Company"), and Xxxxxxxxxxx Xxxxxxx Xxxxxxx (the "Employee").
WITNESSETH:
WHEREAS, the Company desires to employ the Employee as a Vice
President of Sales and Marketing of the Company; and
WHEREAS, the Employee desires to serve the Company as a Vice
President of Sales and Marketing; and
WHEREAS, the Company and the Employee desire to enter into an employment
agreement that shall set forth their respective duties, obligations and
responsibilities;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the receipt and sufficiency of which are hereby acknowledged,
the Company and the Employee agree as set forth below.
1. EMPLOYMENT AND DUTIES
a. The Company agrees to and does hereby employ the
Employee, and the Employee does hereby accept
employment with the Company, as a Vice President
of Sales and Marketing for such territories as the
Company may nominate from time to time, to operate
and manage the sales and marketing of the Company's
products and technologies in such territories with
all the authority customarily afforded to a Vice
President subject to the normal supervision and
authority of the Board of Directors of the Company,
and to perform such other reasonable duties which
are consistent with such position as are from time
to time delegated to the Employee by the Board of
Directors of the Company. The Employee will perform
all services and acts necessary in such capacities
to properly manage sales and marketing of
Company's products and services, and the Employee
shall endeavour in good faith to perform his duties
in an efficient, faithful and businesslike manner.
b. The Employee acknowledges that the Company has an
international presence and that the Employee will be
required to travel internationally as part of his
duties. Such travel may include, but not be limited
to, Europe, Australia, North America (Canada and the
United States) and Asia. The Company shall provide
assistance with any applicable permits and visas
which may be necessary for the Employee to undertake
these duties.
2. TERM OF AGREEMENT
The provisions of this Agreement shall remain in full force and effect
and the employment of the Employee with the Company shall continue
until terminated by a
written Notice of Termination (as described in Section 5(c)) provided
by either the Company or the Employee. In addition, notwithstanding the
previous sentence, this Agreement may be terminated at any time by
mutual agreement of the parties hereto or by the Company at any time
following the date on which the Employee attains age sixty-fiv (65)
(hereinafter termination of this Agreement by the Company after the
Employee has attained age sixty-five (65) shall be referred to as
"Retirement").
3. COMPENSATION
a. BASE SALARY
During the term of this Agreement, the Employee shall be paid
a base salary, payable in accordance with the Company's normal
payroll practice. The Employee's initial base salary shall be
One Hundred Twenty Thousand US Dollars (US$120,000) per annum
payable in equal bi-weekly installments.
b. BONUS
Employee shall be eligible for a bonus plan (the "Bonus Plan")
up to a maximum annual bonus of Eighty Thousand US Dollars
(US$80,000). The Bonus Plan shall be based upon a combination
of reasonable financial and operational objectives established
by the Company. The Bonus Plan will be payable quarterly based
upon successful achievement of the financial objectives and
fiscally based upon successful achievement of the operational
objectives. The Company shall pay any annual Bonus Plan
payments due to the Employee no later than 90 days following
the Company's fiscal year end.
c. BUSINESS EXPENSES
The Company shall reimburse the Employee for all reasonable
business expenses incurred by the Employee in pursuit of
carrying out the duties defined in 1. The Employee shall incur
such expenditure in accordance with the Company's then current
practices for business expenditure. The Company shall not
unreasonably withhold reimbursement of such expenses to the
Employee and shall reimburse the Employee at least once during
each calendar month.
d. REVIEW
The Employee shall be entitled to an annual Compensation
review on each anniversary of the Employee joining the
Company.
4. OTHER EMPLOYEE FRINGE BENEFITS
a. IN GENERAL
The Company shall further provide the Employee with medical,
dental and life insurance coverage, sick leave and statutory
paid holidays, and such other fringe benefits of employment as
the Company may provide from time to time to actively employed
executives of the Company in such amounts or at such rates or
levels as the Company shall reasonably determine.
b. SUPPLEMENTAL BENEFITS
The Company shall also provide the Employee with the following
supplemental benefits:
(i) VACATION
The Employee will be entitled to (20) days paid leave
per year in addition to statutory holidays at such
time as agreed between the Employee and the Company.
(ii) STOCK OPTION PLAN
The Employee will be entitled to one million
(1,000,000) stock options on the conditions, and at
the times set forth below provided however, that
Employee continues to be employed by the Company and
otherwise fulfills his obligationS under this
Agreement:
1) Employee shall have the option to purchase 250,000
shares of the Company's common stock at a price of
Canadian $0.30 per share upon the Employee joining
the Company.
2) Employee shall have the option to purchase 250,000
shares of the Company's common stock at a price of
Canadian $0.30 per share upon the one year
anniversary of Employee's commencement of work
with Company.
3) Employee shall have the option to purchase 250,000
shares at the Company's common stock at a price of
Canadian $0.30 per share upon the two year
anniversary of Employee's commencement of work
with the Company.
4) Employee shall have the option to purchase 250,000
shares of the Company's common stock at a price of
Canadian $0.30 per share upon the three year
anniversary of Employee's commencement of work
with the Company.
(iii) RELOCATION ALLOWANCE
The Company shall pay Employee the sum of Five
Thousand Dollars ($5,000) to defer Employee's
expenses of relocating in order to commence
employment with the Company.
(iv) AIRFARE
The Company shall provide Employee with two (2)
economy class, round-trip airline tickets per year to
the United Kingdom from wherever the Employee is
stationed at the time that he takes leave.
(v) RETIREMENT SAVINGS
The Employee shall, from the first anniversary of
Employee's commencement to work for the Company, be
entitled to participate in any employee pension
scheme that the Company may institute. The amount of
reasonable annual contribution by the Company to the
scheme for the benefit of the Employee shall be
determined at the annual Compensation Review.
5. TERMINATION OF EMPLOYMENT
a. TERMINATION OF EMPLOYMENT BY THE COMPANY
Employee's employment hereunder may be terminated by the
Company without any breach of this Agreement only under the
following circumstances:
(i) DEATH, DISABILITY OR RETIREMENT
The Employee's employment hereunder shall terminate
upon his death and may be terminated by the Company
in the event of his Disability or Retirement. For
purposes of this Agreement, the term "Disability"
shall mean the inability of the Employee due to
illness (mental or physical), accident, or otherwise,
to perform his duties for any period of ninety (90)
consecutive days, as determined by an independent
physician selected by the Company and reasonably
acceptable to the Employe (or his legal
representative), provided that the Employee does not
return to work on substantially a full-time basis
within thirty (30) days after Notice of Termination
is given by the Company pursuant to the provisions of
Sections 5(c) and 5(d)(ii). In the event of
termination for Death, Employee's estate shall be the
beneficiary of any accrued unexercised Stock and/or
unpaid Compensation benefits at the time of Death.
(ii) CAUSE
The Company may terminate the Employee's employment
hereunder for Cause. For the purposes of this
Agreement, the Company shall have "Cause" to
terminate the Employee's employment hereunder only
upon:
(a) his conviction of a felony involving moral
turpitude, provided that such conviction would
at the time have a material adverse effect on
the Company in the reasonable opinion of the
Board of Directors of the Company;
(b) gross and willful misconduct by the Employee
which is deemed, by the Company's Board of
Directors, to be injurious to the Company;
(c) a finding of gross dishonesty of the Employee;
(d) willful malfeasance or gross negligence, or
failure to act involving material non-feasance,
provided that, in the case of such gross
negligence or material non-feasance, it would at
the
time have a material adverse effect on the
Company in the reasonable opinion of the Board
of Directors of the Company;
(e) insubordination or refusal to perform reasonable
assigned duties consistent with those contained
in Section 1;
(f) the Employee's material breach of his
obligations contained in Section 7; or
(g) the Employee's failure to meet the agreed upon
annual sales and management objective for any
fiscal year for the Company.
(iii) FAILURE TO OBTAIN WORK AUTHORISED VISA STATUS
The Company may terminate the Employee's employment
immediately in the event the Employee is not granted
work authorised visa status with the Company by the
government of any territory in which the Company
wishes to carry on a significant part of the
Company's sales and marketing efforts and which
efforts, in the reasonable opinion of the Board,
require that the Employee work in that territory.
b. TERMINATION OF EMPLOYMENT BY EMPLOYEE
The Employee may terminate his employment at any time.
However, he shall be deemed to have terminated his employment
for "Good Reason" only if he terminated his employment by
giving Notice of Termination pursuant to Sections 5(c) and
5(d)(iii) within ninety (90) days after the occurrence of any
of the following events (provided the Company does not cure
such event within thirty (30) days following its receipt of
the Employee's Notice of Termination):
(i) The Employee's compensation is reduced for any reason
other than in connection with the termination of his
employment.
(ii) For any reason other than in connection with the
termination of the Employee's employment, the Company
materially reduces fringe benefits provided to the
Employee under Section 4, unless the Company agrees, as
evidenced by the Employee's written consent, to fully
compensate the Employee for any such material reduction.
(iii) The Company's failure to obtain an agreement from any
successor or assign of the Company to assume and to
agree to perform this Agreement.
(iv) The Company otherwise materially breaches its
obligations to make payments to the Employee under this
Agreement.
Pursuant to termination under 5.b.(iii), Company acknowledges
that all accrued Compensation due to Employee shall become
immediately payable and all stock options including those
defined in 4.(ii) shall be deemed vested and exercisable.
c. NOTICE OF TERMINATION
Any termination of the Employee's employment by the Company
hereunder, or by the Employee other than termination upon the
Employee's death, shall be communicated by written Notice of
Termination to the other party. For purposes of this
Agreement, a "Notice of Termination" means a notice that shall
indicate the specific termination provision in this Agreement
relied upon, and shall set forth in reasonable detail the
facts and circumstances claimed to provide a basis for
termination of th Employee's employment under the provision so
indicated.
d. DATE OF TERMINATION
For purposes of this Agreement, an applicable "Date of
Termination" means:
(i) If the Employee's employment is terminated by his death,
the date of his death.
(ii) If the Employee's employment is terminated by the
Company as a result of Disability or Retirement pursuant
to Section 5(a)(i) or for Cause pursuant to Section
5(a)(ii), the date that is ninety (90) days after Notice
of Termination is given (provided that in the case of
termination for Disability, the Employee shall not have
returned to the performance of his duties on a full-time
basis during such ninety (90) day period).
(iii) If the Employee terminates his employment for Good
Reason pursuant to Section 5(b), the date that is ninety
(90) days after Notice of Termination is given (provided
that the Company does not cure such event during that
ninety (90) day period).
(iv) If the Employee terminates his employment other than for
Good Reason, the date that is ninety (90) days after
Notice of Termination is given.
(v) If the Employee's employment is terminated by the
Company other than for Cause, the date that is ninety
(90) days after Notice of Termination is given.
6. AMOUNTS PAYABLE UPON TERMINATION OF EMPLOYMENT OR DURING DISABILITY
a. TERMINATION PAYMENT
In the event that Employee's employment is terminated pursuant
to Section 5 hereof, the Employee shall not be entitled to any
compensation except as set forth below.
(i) Any compensation that is accrued but unpaid, any
vacation that is accrued but unused, and any business
expenses that are payable, all as of the Date of
Termination.
(ii) Any other rights and benefits (if any) provided under
plans and programs of the Company including accrued but
unexercised stock options, determined in accordance with
the applicable terms and provisions of such plans and
programs.
b. MITIGATION OF DAMAGES
Following any Date of Termination, the Employee shall have an
obligation to seek other employment provided that the Company
has performed its obligations in full as laid out in 6(a) as
at the Date of Termination.
7. CONFIDENTIAL INFORMATION AND COVENANT NOT TO COMPETE
a. The Employee hereby agrees that, during the term of
the Agreement and thereafter, he will not disclose to any
person or otherwise use or exploit any of the proprietary or
confidential information, including, without limitation, trade
secrets, processes, records of research, proposals,
programming, budgets or customer lists, regarding the Company,
its business, properties, or affairs obtained by him at any
time prior to or subsequent to the execution of this
Agreement, except to the extent required by his performance of
assigned duties for the Company.
b. The Employee hereby agrees that during the term hereof and for
a period of one (1) year after his termination of employment
(including upon Retirement), he will not engage in or carry
on, directly or indirectly, whether as advisor, principal,
agent, partner, officer, director, employee, stockholder,
associate or consultant of any person, partnership,
corporation or other business entity which is in material
competition with any business carried on, directly or
indirectly (through one or more subsidiaries or otherwise), by
the Company prior to the date hereof or hereafter conducted by
the Company during the term of this Agreement, directly or
indirectly (through one or more subsidiaries or otherwise) in
any county of the State of California or any other county of
any state in the United States or municipality of a foreign
country where business is then carried on or conducted by the
Company.
c. The Employee agrees that the remedy at law for any breach by
him of any of the covenants and agreements set forth in this
Section 7 will be inadequate and that in the event of any such
breach, the Company may, in addition to the other remedies
which may be available to it at law, obtain injunctive relief
prohibiting him (together with all those persons associated
with him) from the breach of such covenants and agreements.
d. The parties hereto agree that the duration and area for which
the covenant not to compete is set forth in subparagraph (b)
above. The parties intend that this covenant shall be deemed
to be a series of separate covenants, one for each and every
county of each and every state within the United States of
America and one for each municipality of any foreign country
where this covenant is intended to be effective.
e. The Employee will sign separate agreements, policies or
certifications regarding Intellectual Property, Ethical
Business Practices and Conflicts of
Interest, on reasonable terms and on such forms as are
adopted by the Company from time to time for its executives.
8. GENERAL PROVISIONS
a. NOTICES
Any notice to be given pursuant to this Agreement shall be in
writing and shall be deemed duly given three (3) days after
deposit in certified mail, return receipt requested, to the
party to receive such notice at the address specified below:
If to the Company, to:
Xenotech, Inc.
Attn: Xx. Xxxxxx X. Xxxxx
Suite 0/00 Xxxxxxx Xxxxx
Xxxxxxx Xxxx, 0000
Xxxxxxx Xxxxxxxxx
Fax: 000-00-00-000-0000
If to the Employee, to
Xx. Xxxxxxxxxxx Xxxxxxx
The Hayloft
3, Polebrook Mews
Xxxxxxx Drive
Xxxxx Xxxxxx
Xxxxxxxxxx
Xxxxxxxxxxxxxx
XX0 0XX
Xxxxxx Xxxxxxx
Email : XXxxxxxx@XxxxxxXX.Xx.XX
Either party may change its name and/or address for purposes
of this Section by giving the other written notice of the new
name and/or address in the manner set forth above.
b. ASSIGNMENT
This Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective executors,
administrators, heirs, personal representatives, successors
and assigns. Neither this Agreement nor any right hereunder
may be assigned or transferred by either party hereto, any
beneficiary or any other person, nor be subject to alienation,
anticipation, sale, pledge, encumbrance, execution, levy or
other legal process of any kind against the Employee, his
beneficiary, or any other person. Notwithstanding the
foregoing, the Company may assign this Agreement to any
corporation or other business entity succeeding to
substantially all of the business and assets of the Company
by merger, consolidation, sale of assets, or otherwise and may
obtain the assumption of this Agreement by such successor.
c. WAIVER OF BREACH
The waiver by the Company or the Employee of a breach of any
provision of this Agreement by the other shall not operate or
be construed as a waiver of any subsequent breach by the
other.
d. NON-EXCLUSIVITY OF RIGHTS
Nothing in this Agreement shall prevent or limit the
Employee's continuing or future participation in any
incentive, fringe benefit, deferred compensation, or other
plan or program provided by the Company and for which the
Employee may qualify, nor shall anything herein limit or
reduce such rights as the Employee may have under any other
agreements with the Company. Amounts that are vested benefits
or that the Employee is otherwise entitled to receive under
any plan or program of the Company at or after the Date of
Termination, shall be payable in accordance with such plan or
program.
e. ENTIRE AGREEMENT/MODIFICATION
This Agreement, shall supersede any and all other agreements,
either oral or written, between the parties hereto with
respect to the employment of the Employee by the Company. Each
party to this Agreement acknowledges that no other
representations, inducements, promises or agreements, orally
or otherwise, have been made by any party or anyone acting on
behalf of any party, and that no other agreement, statement or
promise with respect to the employment of the Employee by the
Company not contained in this Agreement shall be valid or
binding. Any modification of this Agreement will be effective
only if it is in writing, signed by the party to be charged.
f. PARTIAL INVALIDITY
If any provision of this Agreement is held by a court of
competent jurisdiction to be invalid, void or unenforceable,
the remaining provisions shall nevertheless continue in full
force without being impaired or invalidated in any way.
g. GOVERNING LAW
The validity of this Agreement and the interpretation and
performance of all of its terms shall be governed by the laws
of the State of California.
h. ARBITRATION
Any controversy, claim or dispute between the parties directly
or indirectly concerning this Agreement or the breach hereof,
or the subject matter hereof (except in instances where only
injunctive relief is sought by the either party), shall be
finally settled by arbitration held in the State of
California. Any legal expenses incurred by the Company in
connection with any such claim or dispute shall be paid by the
Company. To the extent that the Employee
prevails in any claim or disput to enforce or defend his
rights under this Agreement, any legal expenses incurred by
the Employee in such claim or dispute shall be paid by the
Company.
i. CAPTIONS
The captions in this Agreement are for convenience and for
identification purposes only, are not an integral part of this
Agreement and are not to be considered in the interpretation
of any part hereof.
j. COUNTERPARTS
This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but together which
shall constitute one and the same document.
IN WITNESS WHEREOF, Xenotech, Inc., has caused this Agreement to be executed by
an appropriate officer and the Employee has executed the same as of the day and
year first above written.
XENOTECH, INC.
a Canadian corporation
By:
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Xxxxxx X. Xxxxx
President
By:
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Xxxxxxxxxxx X. Xxxxxxx
