Exhibit no. 10.10
EMPLOYMENT AGREEMENT
--------------------
THIS AGREEMENT made as of the 18th day of November, 1997.
B E T W E E N:
WAVERIDER COMMUNICATIONS INC., a corporation incorporated
pursuant to the laws of Nevada, in the United States of
America (herein called the "Corporation")
OF THE FIRST PART
and
D. XXXXX XXXXXXXX, residing in the Town of Aurora, in
the Province of Ontario
(herein called the "the Executive")
OF THE SECOND PART
WHEREAS the Corporation desires to employ the Executive and to enter
into an agreement (the "Employment Agreement") embodying the terms of such
employment;
AND WHEREAS the Executive has accepted such employment on
the basis of the terms and conditions set forth herein;
IN CONSIDERATION of the recitals and mutual covenants contained
herein and for other good and valuable consideration, the parties agree as
follows:
1. EMPLOYMENT
----------
The Corporation hereby employs the Executive and the Executive hereby
accepts employment with the Corporation for the term of this Employment
Agreement set forth in Section 2 below, in a position and with the duties,
responsibilities and authority as the Corporation may from time to time assign
to him including, without limitation, those duties, responsibilities and
authority more particularly set forth in Section 3 below, and upon all other
terms and conditions in this Employment Agreement set forth herein.
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2. TERM
----
The term (the "term") of the Executive's employment pursuant to this
Employment Agreement shall commence on November 18, 1997 and shall continue
until December 31, 2000, subject to the provisions of this Employment Agreement
providing for earlier termination of the Executive's employment in certain
circumstances. Thereafter, the term shall be automatically extended for
additional one year periods from and after December 31, 2000 upon the agreement
of the Executive and the board of directors of the Corporation, and subject to
the provisions of paragraph 10 hereof.
3. POSITION, RESPONSIBILITY
------------------------
It is intended that the Executive shall serve as the President and
Chief Executive Officer of the Corporation with responsibility for performing
such duties for the Corporation as the Executive shall reasonably be directed to
perform by the Board of Directors of the Corporation.
Throughout the term of this Employment Agreement, the Executive
shall devote his full business time and undivided attention during normal
business hours to the business and affairs of the Corporation, except for
vacations and except for illness or incapacity, but, subject to Section 10 and
subject to the approval of the Board of Directors of the Corporation, which will
not be unreasonably withheld, nothing in this Employment Agreement shall
preclude the Executive from devoting reasonable periods required for serving, as
appropriate, on boards of directors of other corporations, from engaging in
charitable and public service activities, and from managing his personal
investments, provided such activities do not materially interfere with the
performance of his duties and responsibilities under this Employment Agreement
and do not constitute a conflict of interest with respect to his employment
herein.
4. SALARY, CASH AND STOCK COMPENSATION PLAN
----------------------------------------
For services rendered by the Executive during the term of this
Agreement, the Executive shall be entitled to receive an annual remuneration
package of $500,000. In recognition of the Corporation's cash flow situation
prior to the shipment of product and the receipt of financing (collectively, the
"Cash Flow Events"), for the period December 1, 1997 to March 31, 1998, the
Executive shall be paid the sum of $15,000 (before deductions) per month.
Thereafter, the Executive shall be paid the sum of $25,000 (before deductions)
per month.
The Executive shall also be eligible to receive, in accordance with
the provisions of the Corporation's Employee Stock Compensation (1997) Plan, in
such a manner as the parties hereto mutually determine is most tax effective for
the Executive, shares of the Corporation having a value of $230,000 for the 13
month period ended December 31, 1998 and thereafter $200,000 per annum, to be
payable in arrears on the basis of performance objectives selected by the
Executive and ratified by the board of directors of the Corporation.
The Executive's salary shall be reviewed annually and may be
adjusted taking into account, among other things, individual performance and
general business conditions. In addition, the Executive shall be eligible to
participate in the Corporation's Employee Stock Option (1997) Plan (the "Stock
Option Plan") and any successor plans thereto established by the Corporation for
the general benefit of employees. Pursuant to the Stock Option Plan, the
Executive shall be awarded options (the "Stock Options") to acquire 1,000,000
common shares ("Common Shares") in the capital of the Corporation at an exercise
price of US$0.56 per share, being the market price of the Common Shares on
November 18, 1997. The Stock Options will vest on the basis of performance
objectives selected by the Executive and ratified by the board of directors of
the Corporation.
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5. SIGNING INCENTIVE
-----------------
In recognition of the Executive's extensive executive, marketing and
management experience, the Executive shall further be entitled to an incentive
bonus as follows:
(i) 800,000 series B preferred shares (the "Series B
Preferred Shares") in the capital of the
Corporation are subject to be released in
accordance with the terms and conditions of a
share exchange agreement executed May 13, 1997
among Channel i Inc., Xxxx Xxxxxxx, Xxxxxxx Xxxxx,
Xxx Xxxxxxxxx, Pacific Western Mortgage Corp. and
Major Wireless Communications Inc., as amended by
a collateral agreement of the same date as follows:
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% of Shares
Event
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Prototype development completed 5%
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Prototype operational in one community 10%
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25 non-conditional licence agreements 15%
signed with non-refundable deposits
received
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25 licencees operational utilizing the system 15%
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Gross revenue exceeds CDN$10 million 25%
--------------------------------------------------------------------------------
Gross revenue exceeds CDN$25 million 30%
--------------------------------------------------------------------------------
;and
(ii) the Executive shall be issued options (the "Purchase
Options") to acquire 1,000,000 Common Shares at an exercise
price of US$0.56 per share. The Purchase Options will vest as
to 150,000 per month commencing on December 1, 1997.
In the event that: (a) there is a Change in Control (as hereinafter
defined) of the Corporation; or (b) the Executive is terminated by the
Corporation without cause as provided for in subparagraph 10(d), all of the
Stock Options and all of the Purchase Options shall immediately vest. A "Change
in Control" shall be deemed to have occurred if:
(A) any person or entity acquires beneficial ownership of 20%
or more of the common shares of the Corporation then
outstanding, or such other voting securities of the
Corporation which results in such person or entity owning
20% or more of the combined voting power of the
Corporation's outstanding voting securities; or
(B) the shareholders of the Corporation approve a
reorganization, merger, consolidation, liquidation or
dissolution of the Corporation, or the sale or disposition
of all or substantially all of the assets of the
Corporation; or
(C) a change in the composition of the Board of Directors of
the Corporation occurs such that the individuals who
constitute the board on December 15, 1997 become for any
reason a minority of the board; provided that such change
does not occur as a result of the sickness, health,
disability or death or voluntary resignation of a board
member or members.
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In the event the Executive voluntarily resigns from his position of
employment with the Corporation, dies, or is disabled with the meaning of
subparagraph 10(b) or is terminated for just cause pursuant to subparagraph
10(c) hereof, Stock Options and Purchase Options which have not yet vested will
be forfeited by the Executive.
6. AUTOMOBILE
----------
The Employer shall provide the Executive with an automobile at its
expense for the Executive's business and personal use, such automobile to have a
monthly lease expense not to exceed $1,100. The Employer shall also be
responsible for insurance, gas, maintenance and repair expenses generated by the
use of the automobile on behalf of the Corporation.
7. PERQUISITES AND BUSINESS EXPENSES
---------------------------------
The Executive will be reimbursed for all reasonable expenses
incurred by him or her in connection with the conduct of the Corporation's
business upon presentation of sufficient evidence of such expenditures are
authorized expenditures pursuant to policies adopted by the Board of Directors
of the Corporation from time to time.
8. BENEFIT PROGRAMS
----------------
The Executive will be entitled to participate effective November 18,
1997 in all the Executive benefit programs of the Corporation from time to time
in effect under the terms and conditions of such programs, including, but not
limited to, pension and other retirement plans, group life insurance,
hospitalization and surgical and major medical coverages, dental insurance, sick
leave, including salary continuation arrangements, vacations and holidays,
long-term disability, and such other fringe benefits as are or may be available
from time to time to other executives of the Corporation.
9. VACATION
--------
The Executive shall be entitled to all usual public holidays and, in
addition, to 30 business days paid vacation during each year of the Executive's
employment hereunder. Such vacation shall be utilized by the Executive at such
time or times as do not materially interfere with the ongoing conduct of the
Corporation's business and operations.
10. TERMINATION OF EMPLOYMENT
-------------------------
(a) Death - In the event of the death of the Executive during
the term of this Employment Agreement, the Executive's
salary will be paid to the Executive's designated
beneficiary, and in the absence of such designation, too the
estate or other legal representatives of the Executive,
through the end of the month in which death occurs. Rights
and benefits of the Executive under the Executive benefit
plans and programs of the Corporation, including life
insurance, will be determined in accordance with the terms
and conditions of such plans and programs.
(b) Disability - The Executive's employment shall terminate
automatically upon written notice from the Corporation in
the event of the Executive's absence or inability to render
the services required hereunder due to disability, illness,
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incapacity or otherwise for an aggregate of one hundred and
eighty days during any 12 month period during the term. In
the event of any such absence or inability, the Executive
shall be entitled to receive the compensation provided for
herein for such period, and thereafter the Executive shall
be entitled to receive compensation in accordance with the
Corporation's long-term disability plan, if any, together
with such compensation, if any, as may be determined by the
Board of Directors of the Corporation.
(c) Termination by the Corporation for Cause - In the event of a
termination for cause, there will be no continued salary
payments by the Corporation to the Executive and any rights
and benefits of the Executive under the Executive benefit
plans and programs of the Corporation will be determined in
accordance with the terms of such plans and programs. For
the purposes of this Section 10(c) and of the Executive's
employment with the Corporation, "cause" shall mean that:
i) The Executive has committed a felony or indictable
offence or has improperly enriched himself at the
expense of the Corporation or has committed an act
evidencing dishonesty or moral turpitude, including
without limitation an act of theft;
ii) The Executive, in carrying out his duties hereunder,
(A) has been wilfully or grossly negligent, or (B) has
committed wilful and gross misconduct or, (C) has
failed to comply with a clear instructions or
directives from the Board of Directors of the
Corporation after having been informed of a failure to
so comply;
iii) The Executive has breached a material term of this
Employment Agreement;
iv) The Executive becomes bankrupt or in the event a
receiving order (or any analogous order under any
applicable law) is made against the Executive or in the
event the Executive makes any general disposition or
assignment for the benefit of his creditors; or
v) The Executive commits any other act giving the
Corporation cause to terminate the Executive's
employment, including, but not limited to chronic
alcoholism or drug addiction, material malfeasance or
non-feasance with respect to the Executive's duties
hereunder.
Prior to any termination of the Executive for cause due to
any occurrence described in subparagraphs 10(c)(ii), (iii),
(v) and (vi) above, the Corporation shall notify the
Executive in writing of the particulars of the occurrence
upon which termination would be based and shall in such
notice advise the Executive as to whether, in the
Corporation's sole discretion, the default of the Executive
occasioned by such occurrence is capable of being cured or
rectified in full without loss or damage to the Corporation,
in which case the Corporation shall afford the Executive a
reasonable period of not less than five business days in
which to cure or rectify such default. In such event and
provided the Executive cures or rectifies such default in
full without loss or damage to the Corporation, the
Executive's employment shall not be terminated on the basis
of such occurrence.
(d) Termination by the Corporation without Cause - In the event
of a termination without cause, the Employer will provide a
severance package which will include a minimum of one year's
salary, plus one month's salary for each year of employment
in excess of twelve years service, to be calculated on base
salary and pro-rated for car allowance and bonus incentive.
It is agreed and understood that these amounts are
reasonable and include any obligations which the employer
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may have or pay in lieu of notice and/or severance pay
pursuant to the Employment Standards Act, R.S.O. 1990, c.
E-14, or its counterpart in any other jurisdiction. In
addition, it is agreed that if the Executive is terminated
without cause, the Vesting Dates with respect to all Signing
Bonus Options shall be deemed to have occurred immediately
prior to such termination. It is agreed that this Employment
Agreement may not be terminated by the Corporation without
cause, without the approval of the board of directors of the
Corporation.
11. NON-COMPETITION
---------------
The Executive agrees that during the period of the Executive's
employment with the Corporation and for a period of twelve months from the last
payment of compensation to the Executive by the Corporation, the Executive shall
not engage in or participate in any business activity that competes, directly or
indirectly in the North American market, with the businesses of the Corporation,
or its subsidiaries or affiliates.
For the purposes of this Section 11, the Executive shall be deemed
to "compete, directly or indirectly, with the business of the Corporation, or
its subsidiaries or affiliates" if the Executive is or becomes engaged,
otherwise than at the request of the Corporation, as an officer, director or the
Executive of, or is or becomes associated in a management or ownership,
consultant or agent, capacity with any corporation, partnership or other
enterprise or venture whose business includes the distribution of competing
products.
It is the desire and intent of the parties that the provisions of
this Section 11 shall be enforceable to the fullest extent permissible under the
laws and public policies applied in each jurisdiction in which enforcement is
sought. Accordingly, if any particular portion of this Section 11 is adjudicated
unenforceable in any jurisdiction such adjudication shall apply only in that
particular jurisdiction in which such adjudication is made.
12. NON-SOLICITATION
----------------
The Executive agrees that for a period of one year following
the termination of the Executive's employment with the Corporation for any
reason whatsoever, the Executive will not, whether as principal, agent, the
Executive, employer, director, officer, shareholder or in any other individual
or representative capacity, solicit or attempt to retain in any way whatsoever
any of the Executives of the Corporation or their respective subsidiaries or
affiliates.
13. CONFIDENTIAL INFORMATION
------------------------
All confidential records, material and information and copies
thereof and any and all trade secrets concerning the business or affairs of the
Corporation or any of its affiliates obtained by the Executive in the course and
by the reason of his employment shall remain the exclusive property of the
Corporation. During the Executive's employment or at any time thereafter, the
Executive shall not divulge the contents of such confidential records or any of
such confidential information or trade secrets to any person other than to the
Corporation of to the Corporation's qualified the Executives, and the Executive
shall not, following the termination of his employment hereunder, for any reason
use the contents of such confidential records or other confidential information
or trade secrets for any purpose whatsoever.
14. WITHHOLDING
-----------
Anything to the contrary notwithstanding, all payments required to
be made by the Corporation hereunder to the Executive or his estate or
beneficiaries, shall be subject to the withholding of such amounts relating to
taxes as the Corporation may reasonably determine, after consultation with the
Executive, it should withhold pursuant to any applicable law or regulation. In
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lieu of withholding such amounts, in whole or in part, the Corporation may, in
its sole discretion, accept other provisions for payment of taxes and
withholdings as required by law, provided the Corporation is satisfied that all
requirements of law affecting the Corporation's responsibilities to withhold
have been complied with.
15. ENTIRE AGREEMENT
----------------
This Employment Agreement contains the entire agreement between the
parties hereto with respect to matters herein and supersedes all prior
agreements and understandings, oral or written, between the parties hereto
relating to such matters.
16. ASSIGNMENT
----------
Except as herein expressly provided, the respective rights and
obligations of the Executive and the Corporation under this Employment Agreement
shall not be assignable by either party without the written consent of the other
party and shall enure to the benefit of and be binding upon the Executive and
the Corporation and their permitted successors or assigns, including, in the
case of the Corporation, any other corporation or entity with which the
Corporation may be merged or otherwise combined or which may acquire the
Corporation or its assets in whole or in substantial part, and, in the case of
the Executive, his estate or other legal representatives. Nothing herein
expressed or implied is intended to confer on any person other than the parties
hereto any rights, remedies, obligations or liabilities under or by reason of
this Employment Agreement.
17. APPLICABLE LAW
--------------
This Employment Agreement shall be deemed a contract under, and for
all purposes shall be governed by and construed in accordance with, the laws of
the Province of Ontario without regard to the conflict of laws rules thereof.
The Corporation and the Executive hereby each irrevocably consent and attorn to
other jurisdiction of the courts of the Province of Ontario with respect to any
dispute or proceeding arising in connection with this Employment Agreement.
18. AMENDMENT OR MODIFICATION: WAIVER
---------------------------------
No provision of this Employment Agreement may be amended or waived
unless such amendment or waiver is authorized by the Corporation (including any
authorized officer or committee by the Board of Directors) and is in writing
signed by the Executive and by a duly authorized officer of the Corporation.
Except as otherwise specifically provided in this Employment Agreement, no
waiver by either party hereto of any breach by the other party of any condition
or provision of this Employment Agreement to be performed by such other party
shall be deemed a waiver of a similar or dissimilar breach, condition or
provision at the same time or at any prior or subsequent time.
19. RESIGNATIONS
------------
The Executive hereby agrees that, upon termination of this
employment for any reason whatsoever, the Executive shall thereupon be deemed,
upon the request of the Corporation, to have immediately resigned any position
the Executive may have as an officer and/or director of the Corporation,
together with any other office, position or directorship which the Executive may
hold with any of the Corporation's subsidiaries or related entities in
connection with or arising from the performance of the Executive duties of
employment under this Employment Agreement. In such event, the Executive shall,
at the reasonable request of the Corporation, forthwith execute any and all
documents appropriate to evidence such resignations which are consistent with
the terms of this Employment Agreement.
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20. PROVISIONS SURVIVING TERMINATION
--------------------------------
It is expressly agreed that notwithstanding termination of the
Executive's employment with and by the Corporation for any reason or cause or in
any circumstances whatsoever, such termination shall be without prejudice to the
rights and obligations of the Executive and the Corporation, respectively, in
relation or arising up to the time up to and including the date of termination;
and the provisions of Sections 10(c) and (d), 11, 12, 13, 14, 17, 19 and 20 of
this Employment Agreement, all of which shall remain and continue in full force
and effect unless and until the Board of Directors of the Corporation at its
absolute discretion resolves otherwise and so notifies the Executive in writing.
21. SEVERABILITY
------------
In the event that any provision or portion of this Employment
Agreement shall be determined to be invalid or unenforceable for any reason, the
remaining provisions and portions of this Employment Agreement shall be
unaffected thereby and shall remain in full force and effect to the fullest
extent permitted by law.
22. COUNTERPARTS
------------
This Employment Agreement may be executed in counterparts, each of
which shall be an original, but all of which together shall constitute one and
the same instrument.
23. REFERENCES
----------
In the event of the Executive's death or a judicial determination of
his incompetency, reference in this Employment Agreement to the Executive shall
be deemed, where appropriate, to refer to his beneficiary or beneficiaries.
24. CAPTIONS
--------
Captions to the Sections of this Employment Agreement are solely for
convenience and no provision of this Agreement is to be construed by reference
to the captions of that Section.
25. CURRENCY
--------
Unless otherwise specified herein, all dollar amounts referred to
herein shall mean Canadian dollars.
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IN WITNESS WHEREOF this Employment Agreement has been executed by a duly
authorized officer of the Corporation and the Executive as of the day first
above written.
WAVERIDER COMMUNICATIONS INC.
By: /s/ Xxxxxxx Xxxxx
-------------------------------
Xxxxxxx Xxxxx
SIGNED, SEALED and )
DELIVERED in the presence of: )
)
)
)
)
/s/ Xxxx Xxxxxx ) /s/ D. Xxxxx Xxxxxxxx
-------------------------------- -------------------------------
Witness D. XXXXX XXXXXXXX
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