Exhibit 4.20
[GRAPHIC OMITTED]
INCENTIVE RETENTION AGREEMENT
MEMORANDUM OF AGREEMENT made in Mississauga, Ontario, as of September 21, 2001,
BETWEEN:
Cedara Software Corp., a corporation incorporated under the laws
of Ontario, having its principal place of business in
Mississauga, Ontario (hereinafter referred to as the
"Corporation")
AND:
Dr. Xxxxxxx Xxxxxxxxx, domiciled and residing in Richmond Hill,
Ontario
(hereinafter referred to as the "Executive")
WHEREAS the Corporation is in need of a third party financing and is
desirous of having the continued employment of the Executive in order to
complete such a financing;
AND WHEREAS the Corporation may be acquired by an arm's length third
party;
AND WHEREAS the Corporation desires to provide an incentive to the
Executive in connection with a financing or acquisition in order to retain and
have the continued benefit of the Executive's knowledge and experience in the
completion of a financing or acquisition;
AND WHEREAS the Corporation and the Executive desire to enter into this
incentive retention agreement (the "Agreement") to set forth the definitive
terms and conditions of such an incentive;
NOW, THEREFORE, for the reasons set forth above, and in consideration
of the mutual promises and agreements hereinafter set forth and for other good
and valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the Corporation and the Executive agree as follows:
ARTICLE 1
INTERPRETATION
Section 1.1 Definitions
For the purpose of this Agreement, unless the context otherwise
requires, the following words or expressions shall have the following meanings:
"Board" shall mean the Board of Directors of the Corporation.
"Cause" shall mean any act or omission of the Executive which would in
law permit a Corporation to, without notice or payment in lieu of
notice, terminate the employment of an employee.
"Successful Transaction" shall mean (i) the issuance of debt or equity
securities of the Corporation, whether issued by way of prospectus or
on a private placement basis, or any prepayment by any customer, or any
combination of the foregoing, whether in a single transaction or series
of transactions, which results in net proceeds to the Corporation of no
less than Cdn.$15,000,000 and which the Board of Directors in its sole
discretion determines is sufficient to adequately address the liquidity
needs of the Corporation , (ii) the acquisition by an arm's length
third party of no less than 50% of the issued and outstanding common
shares of the Corporation, or (iii) the acquisition of the Corporation
by an arm's length third party by way of merger, amalgamation, plan of
arrangement or otherwise.
ARTICLE 2
FINANCING INCENTIVE BONUS
Section 2.1 Transaction Incentive Bonus
Provided that:
(a) a Successful Transaction is closed on or prior to November 30,
2001; and
(b) the Executive shall have not voluntarily resigned or retired, or
been terminated for Cause by the Corporation, at any time between
the date of this Agreement, and the date that is six (6) months
following the closing date of a Successful Transaction; and
(c) the Executive shall have made a meaningful contribution in
consummating the Successful Transaction as determined in the sole
discretion of the Board of Directors;
then the Corporation shall pay to the Executive a one-time bonus equivalent to
Cdn.$353,000 (the "Incentive Bonus"), on the business day following the date set
forth in this Section 2.1(b)(ii).
ARTICLE 3
TERMINATION
Section 3.1 Termination
This Agreement shall automatically terminate on the earlier of:
(a) at 5:00 p.m. (Toronto time) on November 30, 2001 if a Successful
Transaction shall have not closed by such time;
(b) immediately, should the Executive voluntarily resign or retire,
or be terminated for Cause by the Corporation, at any time
between the date of this Agreement and the date that is six (6)
months following the closing date of a Successful Transaction; or
(c) immediately, and at any time, upon mutual written agreement of
the Corporation and the Executive.
Section 3.2 Effect of Termination
Upon termination of this Agreement in accordance with its terms, this
Agreement shall no longer be of any force or effect and for greater certainty,
the Corporation shall have no further liability or obligation whatsoever under
this Agreement, including, without limitation, any obligation to pay the
Incentive Bonus to the Executive whether or not the condition set forth in
Section 2.1(a) shall have been met by such time.
ARTICLE 4
NOTICES
Section 4.1 Notices
Any notice required or permitted to be given by a party hereto to the
other shall be deemed validly given if personally delivered or mailed by
registered prepaid post and addressed as follows:
in the case of the Corporation to:
Cedara Software Corp.
0000 Xxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxx
X0X 0X0
Attention: Lead Director of the Board
in the case of the Executive, to:
Dr. Xxxxxxx Xxxxxxxxx
00 Xxxxx Xxxx Xxxxx
Xxxxxxxx Xxxx, Xxxxxxx
X0X 0X0
provided that a party hereto may from time to time notify the other in writing
of a new address to which notices to it shall henceforth be sent until further
notice in writing be given. Any notice shall be deemed to be effected (i) if
personally delivered, on the date of receipt, or (ii) if mailed, on the fifth
business day following the date of mailing. Notwithstanding the foregoing, if
a strike or lockout of postal employees is in effect, or generally known to be
impending, notice shall be effected by personal delivery.
ARTICLE 5
MISCELLANEOUS
Section 5.1 Insurance Coverage for Executive
The Corporation agrees to purchase for the benefit of the Executive
an additional life insurance policy sufficient to cover the repayment of all
monies and associated liabilities owing to the Corporation by the Executive
and to maintain such coverage for the period of time that the Executive
remains an employee of the Corporation. The Corporation agrees that such
policy shall be fully portable by the Executive following termination of the
Executive's employment for whatever reason.
Section 5.2 Assignment
This Agreement may not be assigned by the Executive. The Executive
acknowledges and agrees that the Corporation may assign this Agreement.
Section 5.3 Governing Law
This Agreement is to be governed by and construed and enforced in
accordance with the laws of the Province of Ontario and the laws of Canada
applicable therein.
Section 5.4 Severability
If any provision of this Agreement is determined to be invalid,
illegal or incapable of being enforced for any reason, all other conditions
and provisions of this Agreement shall nevertheless remain in full force and
effect.
Section 5.5 Successors and Assigns
This Agreement shall enure to the benefit of and be binding upon the
successors and assigns of the Corporation.
Section 5.6 Required Deductions For Withholdings
The Corporation shall make such deductions and withholdings from any
payments hereunder as may be required by law.
Section 5.7 Counterparts
This Agreement may be executed by the parties in one or more
counterparts, each of which when so executed and delivered shall be deemed to
be an original and such counterparts shall together constitute one and the
same instrument.
IN WITNESS WHEREOF the parties hereto have executed this Agreement at
the place and as of the date first mentioned above.
SIGNED, SEALED AND DELIVERED )
in the presence of )
)
)
/s/ XXXXX XXXX ) /s/ XXXXXXX XXXXXXXXX
-------------------------------- ----------------------------------------
Witness )
XXXXXXX XXXXXXXXX
CEDARA SOFTWARE CORP.
Per: /s/ XXXXX XXXXXX
---------------------------------
Title: DIRECTOR, CHAIRMAN OF O.D.
COMMITTEE
