Exhibit 4.5
EMPLOYMENT AGREEMENT
THIS AGREEMENT made as of the 1st day of January, 2001
BETWEEN:
IMI INTERNATIONAL MEDICAL INNOVATIONS INC., a corporation existing
under the laws of Canada
(hereinafter called "IMI")
-and-
XXXXXXX XXXXXXX, of the City of Dundas, in the Province of Ontario
(hereinafter called the "Employee")
WHEREAS IMI and the Employee wish to enter into a written agreement
which contains the agreed upon terms and conditions of employment for their
mutual benefit;
NOW THEREFORE in consideration of the mutual covenants and agreements
contained in this agreement and for other good and valuable consideration, the
adequacy of which is hereby acknowledged, the parties to this agreement do
mutually covenant and agree as follows:
ARTICLE 1 - DUTIES OF EMPLOYMENT
1.1 Position - The Company agrees to continue to employ the Employee in
the position of Executive Vice President, Clinical and Regulatory Affairs, to
serve in such capacity as IMI's needs may, from time to time, require and as are
made known to him by IMI or its authorized representatives. In this capacity,
the Employee shall perform such services as are required from time to time by
the Board of Directors of IMI (the "Board") provided, however, that without the
Employee's prior written consent, the Employee shall not be required to perform
services other than those comparable in scope and dignity to those the Employee
is presently performing.
1.2 Duties - The Employee accepts the office on the terms and
conditions set forth in this Agreement and acknowledges that as Executive Vice
President, Clinical and Regulatory Affairs, he has the responsibility for the
general supervision of the clinical and regulatory aspects of the business of
IMI, subject to the authority of the President of IMI and the Board. Throughout
the term of his employment, the Employee agrees to devote substantially all of
his business time and effort to carry out the performance of his duties under
this Agreement and shall conform to all lawful instructions and directions given
to him by the Board, or its authorized designees, and obey and carry out the
by-laws of IMI, as well as all written rules, policies and practices now or
hereafter established and amended from time to time by IMI for the conduct of
its affairs and brought to the attention of the Employee.
ARTICLE II - TERMS OF EMPLOYMENT
2.1 Term - The provisions of the Agreement shall have effect from the
date hereof and shall continue in effect indefinitely or until terminated in
accordance with the provisions of this Agreement
ARTICLE III - EMPLOYEE'S COMPENSATION AND BENEFITS
3.1 Compensation - The annual base salary payable to the Employee for
the Employee's services hereunder for the term of this Agreement shall be
$200,000 (gross), exclusive of bonuses, benefits and other compensation. The
annual base salary payable to the Employee pursuant to the provisions of this
Article III shall be payable in equal semi-monthly installments, in arrears, in
accordance with existing practice, or in such other manner as may be mutually
agreed upon, less, in any case, any deductions or withholdings required by law.
3.2 Salary Review - The Employee's salary and benefits shall be as
stated in Article III but shall be reviewed on January 1, 2002 and annually
thereafter during the term of this Agreement and any renewal of this Agreement
3.3 Vacation - The Employee shall be entitled to vacation with pay of
four (4) weeks during each calendar year of this Agreement. The employee's paid
vacation is to be taken at a time approved in advance by the President of IMI or
the Board, which approval shall not be unreasonably withheld but shall take into
account the staffing requirements of IMI and the need for the timely performance
of the Employee's responsibilities. Vacation not taken in one year may not be
carried over into subsequent years and shall expire at the end of the applicable
year.
3.4 Benefits - The Employee shall participate in all benefit plans
which IMI provides to its Employees, including extended health, medical and
dental. In the event that such benefit plans include additional benefits and/or
coverage for executives, then the Employee shall be entitled to such additional
benefits.
3.5 Additional Compensation - The Employee shall also receive bonuses
and options to purchase shares of IMI as may be granted by the Board, in their
discretion, from time to time.
3.6 Expenses - IMI shall reimburse the Employee forthwith for all
proper and reasonable out-of-pocket expenses actually incurred by the Employee
in the performance of his duties upon presentation of supporting statements,
receipts or vouchers. Subject to the provisions of IMI's governing corporate
legislation, IMI agrees to indemnify and save the Employee harmless from and
against any and all demands, claims, costs, charges and expenses, including an
amount paid to settle an action or satisfy a judgment, reasonably incurred by
him in respect of any civil, criminal or administrative action or proceeding to
which the Employee is made a party by reason of having been a director or
officer of IMI or of any affiliated company, whether before or after termination
if:
(a) the Employee acted honestly and in good faith with a
view to the best interests of IMI; and
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(b) in the case of a criminal or administrative action or
proceeding that is enforced by a monetary penalty,
the Employee had reasonable grounds for believing
that his conduct was lawful.
ARTICLE IV - TERMINATION
4.1 Notwithstanding anything contained in this Agreement, IMI and the
Employee agree that this Agreement and the employment of the Employee may be
terminated as follows:
(a) immediately by IMI at its option, at any time, and
without notice or pay in lieu of such notice, for
cause. For the purposes of this Agreement, "cause"
shall include the following:
(i) a material breach by the Employee of the
provisions of Article V at any time;
(ii) conviction of the Employee of a criminal
offence punishable by indictment, or summary
conviction where such conviction brings into
question the Employee's ability to perform
his duties under this Agreement honestly and
effectively or where such conviction could
adversely affect the reputation and goodwill
of IMI; and
(iii) in the event of death or any "disability",
as such term is defined in any disability
insurance policy of IMI or if no such policy
is in place, disability shall mean mental or
physical disability or serious illness of
the Employee which results in the Employee
being unable to substantially perform his
duties for a continuous period of 180 days
or for periods aggregating 225 days in any
period of 365 days;
(b) at any time by IMI, without cause by paying, in lieu
of notice, an amount equal to one year of the
Employee's then current (i) annual salary; (ii)
benefits as contemplated in section 3.4; and (iii)
additional compensation as contemplated in section
3.5, all payable in accordance with, and subject to
the reduction contained in, Section 4.2 herein
(c) by the Employee, upon prior written notice to IMI at
any time within 180 days after the Change of Control
of IMI in which case IMI shall pay to the Employee an
amount equal to 12 months of the Employee's then
current annual salary, payable immediately; or
(d) at any time by the Employee upon 90 days written
notice to IMI.
For the purposes of this Section 4.1,
"Associate" and "Affiliate" have the meanings ascribed thereto by the
Securities Act (Ontario) as at the date hereof;
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"Concert Parties" means, in relation to any person, all other persons
acting jointly or in concert with such person. For the purposes hereof it is a
question of fact as to whether a person is acting jointly or in concert with
another person in relation to IMI. Without limiting the generality of the
foregoing, the following shall be deemed to be acting jointly or in concert with
a particular person:
(i) every person who, as a result of any agreement,
commitment or understanding, whether formal or
informal, with the particular person or with any
other person acting jointly or in concert with the
particular person, acquires or offers to acquire
securities of IMI;
(ii) every person who, as a result of any agreement,
commitment or understanding, whether formal or
informal, with the particular person or with any
other person acting jointly or in concert with the
particular person, intends to exercise jointly or in
concert with the particular person or with any other
person acting jointly or in concert with the
particular person any voting rights attaching to any
securities of IMI; and
(iii) every associate or affiliate of the particular
person or of any person who is acting jointly or in
concert with the particular persons and
"Change of Control" of IMI shall have occurred if:
(i) any person (other than the Employee) and the Concert
Parties thereof beneficially own more than 50% of the
outstanding shares of IMI entitled to vote generally
in the election of directors of IMI; or
(ii) IMI completes (A) a merger or other business
combination of IMI with or into another corporation
unless after giving effect thereto the shareholders
of IMI own shares of the successor corporation
carrying more than 50% of the votes in the election
of directors; or (B) a sale, exchange or other
disposition of all or substantially all of the assets
of IMI.
4.2 Payment of Termination Amount. The amounts payable to the Employee
as contemplated in subsection 4.1(b) above shall be paid in 12 equal monthly
installments over an 11 month period beginning 30 days after the date of
termination provided, however, that if the Employee obtains alternative
employment during such 11 month period, the monthly installments beginning on
the later of:
(a) the date of this commencement of such alternative
employment; and
(b) the date which is six months after the date of
termination
shall be reduced by the amount equal to the remuneration
earned by the Employee in such alternative employment in such
month.
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For the purposes of this Section 4.2, "alternative employment" shall
mean any form of remunerative activity in the nature of employment, whether as
employee, consultant, agent, partner, sole proprietor or otherwise.
4.3 Effect of Termination
(a) Upon termination of this Agreement, the employment of
the Employee shall be automatically terminated and
the Employee shall have no claims against IMI for
failure to give reasonable notice of termination or
otherwise except in respect of payment of salary or
accrued vacation pay to the date of termination and
payments specifically provided for herein.
(b) Upon termination of employment, the Employee shall
immediately resign all offices (including
directorships) held in IMI and the Employee shall not
be entitled to receive any additional severance pay
or compensation for loss of office or otherwise by
reason of resignation (other than as otherwise
provided for herein). If the Employee fails to resign
as mentioned, IMI is irrevocably authorized to
appoint some person in the Employee's name and on his
behalf to sign any documents or do any thing
necessary or requisite to give effect to it.
(c) If the Employee is terminated without cause or if the
Employee terminates this Agreement pursuant to
subsection 4.1(c) above, all options to acquire
shares of IMI held by the Employee shall immediately
and automatically become fully vested and shall be
exercisable by the Employee within the time period
which is 60 days from the date of such termination
and, after such 60 day period, all unexercised
options held by the Employee shall expire and shall
be cancelled by IMI.
(d) If the Employee is terminated with cause, all
options, whether vested or otherwise, shall
immediately expire and shall be cancelled at the date
of such termination.
(e) The provisions of subsections (c) and (d) above shall
apply to all options to acquire shares of IMI granted
previously or hereafter to the Employee unless the
terms of such options specifically state that such
subsections do not apply.
4.4 Company's Property
The Employee acknowledges that all items of any and every
nature or kind created or used by the Employee pursuant to the Employee's
employment under this Agreement, or furnished by IMI to the Employee, and all
equipment, credit cards, books, records, reports, files, manuals, literature,
confidential information or other materials shall remain and be considered the
exclusive property of IMI at all times and shall be surrendered to IMI, in good
condition, promptly on the termination of the Employee's employment irrespective
of the time, manner or cause of termination. All personal effects used by the
Employee in carrying out his
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duties will remain the property of the Employee and shall be removed by him on
termination of his employment.
ARTICLE V - CONFIDENTIAL INFORMATION AND NON-COMPETITION
5.1 Confidential Information
(a) The Employee acknowledges that throughout the course
of his employment with IMI the Employee may have
access to and be entrusted with confidential
information, trade secrets and know-how concerning
the business and property of IMI and with
information, trade secrets and know-how which other
persons shall require IMI and its employees, agents
and consultants to treat as confidential (all of
which information, trade secrets and know-how of IMI
and others shall be collectively defined as
"Confidential Information").
(b) The Employee agree that disclosure of any of the
Confidential Information or any use of the
Confidential Information other than on behalf of or
for the direct benefit of IMI is and will be highly
detrimental to IMI and that the right to maintain the
confidentiality of the Confidential Information
constitutes a proprietary right which IMI is entitled
to protect or is an obligation which IMI must
observe. Accordingly, the Employee hereby agrees
that:
(i) he shall keep confidential all of the
Confidential Information for the exclusive
benefit and use of IMI and will faithfully
do all in his power to assist IMI in keeping
the Confidential Information confidential
until IMI shall make the same public either
by obtaining patent rights, copyrights or
otherwise;
(ii) shall not, directly or indirectly, disclose
or divulge any of the Confidential
Information to any person, firm,
corporation or other entity of any kind
whatsoever
(iii) he shall not, directly or indirectly, either
individually or in partnership with, or
jointly with one or more persons, firms,
corporations or any other entity of any kind
whatsoever as xxxxxxxx0, agent, employee,
shareholder or in any other capacity or
manner whatsoever, use any of the
Confidential Information other than on
behalf of or for the direct benefit of IMI;
(iv) he shall not divulge, disclose or
communicate to any person, firm or
corporation the name of any customer of
IMI and/or the Business (as hereinafter
defined); and
(v) he shall not use for his own purpose any
Confidential Information relating to IMI
and/or the Business.
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(c) The Employee acknowledges that the restrictions
contained herein for the benefit of IMI are
reasonable and not excessive in the circumstances of
the Employee's knowledge and the scope of his
employment.
5.2 Non-Competition - The Employee agrees that the Employee will not,
without the prior written consent of IMI, while employed by IMI and for a period
of one (1) year after the date of termination as contemplated in subsections
4.1(a), (b) or(d):
(a) directly or indirectly, in any manner whatsoever,
including, without limitation, either individually or
in partnership or jointly, or in conjunction with any
other person or persons, firm, association,
syndicate, company or corporation, as principal,
agent, shareholder or in any other manner whatsoever
carry on or be engaged in any business directly
competitive with the business of IMI (the "Business")
in any country where IMI operates, or be concerned
with or interested in or lend money to, guarantee the
debts or obligations of or permit his name or any
part thereof to be used or employed by any person,
persons, firm, association, syndicate, company or
corporation engaged in, concerned with or interested
in any directly competitive business except that the
Employee may own no more than 5% of the total issued
and outstanding capital stock of a publicly-held or
private corporation engaged in, concerned with or
interested in any directly competitive business;
(b) directly or indirectly solicit, interfere with or
endeavour to direct or entice away from IMI any
customer or any person, firm or corporation in the
habit of dealing with IMI, and/or the Business; or
(c) interfere with, entice away or otherwise attempt to
obtain the withdrawal of any employee or independent
contractor of IMI or, following termination of the
Employee's employment, any employee who was in the
employ of IMI during the one (1) year period, as the
case may be, preceding termination for cause.
5.3 The Employee hereby acknowledges and agrees that all covenants,
provisions and restrictions contained in this Article V hereof are reasonable
and valid and all defences to the strict enforcement thereof by IMI are waived
by the Employee.
5.4 The Employee further acknowledges and agrees that in the event of
a violation of the covenants, provisions and restrictions contained in this
Article V, IMI shall be authorized and entitled to obtain from any court of
competent jurisdiction preliminary and permanent injunctive relief and an
accounting of all profits and benefits arising out of such violation, which
right and remedies shall be cumulative and in addition to any other rights or
remedies to which IMI may be entitled.
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5.5 It is understood by the Parties hereto that the covenants in this
Article V by the Employee not to enter into competition with IMI are essential
elements to this Agreement and that, but for the agreement of the Employee to
enter into such covenants, IMI would not have retained the Employee.
ARTICLE VI - CLAUSES SURVIVING TERMINATION
6.1 Any confidentiality and non-solicitation clauses in Article VI of
this Agreement shall survive the termination of this Agreement, as shall
Sections 3.6, 4.3 and 4.4 hereof.
ARTICLE VII - PLAIN ENGLISH
7.1 This Agreement is intended to be written in plain English. When
words or expressions of a general nature are employed herein, it is intended
that they be comprehensive, unless the context clearly dictates otherwise.
ARTICLE VIII - GENERAL
8.1 General - Any notice, document or other communication required or
permitted to be given in respect of this Agreement shall be sufficiently given
if delivered to the party personally, or if sent by prepaid ordinary mail posted
in Canada, by courier, or by facsimile, to such party addressed as follows:
IMI: IMI International Medical Innovations Inc.
0000 Xxxxx Xxxxxx - Xxxxx 000
Xxxxxxx, Xxxxxxx X0X 0X0
Telecopier No.: (000) 000-0000
Attention: Chairman
Employee: Xxxxxxx Xxxxxxx
0 Xxxxxxx Xxxxx
Xxxxxx, Xxxxxxx X0X 0X0
Any party may at any time change its address hereunder by giving notice of such
change of address to the other party or parties in the manner specified in this
paragraph. Any such notice or other written communication shall, if mailed or
sent by courier, be effective on the day it is delivered or an attempt is made
to deliver it to the address of the addressee and, if given by personal
delivery, shall be effective on the day of actual delivery.
8.2 Severability - If any covenant, provision or restriction contained
in this Agreement is found to be void or unenforceable in whole or in part, it
shall not effect or impair the validity of any other covenant, provision or
restriction and without limitation, each of the covenants, provisions and
restrictions contained herein are herby declared to be separate and distinct
covenants, provisions and restrictions.
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8.3 Waiver of Performance - The Employee and IMI may, in writing,
extend the time for performance or waive non-compliance or non-performance by
the other of the other's obligations, covenants and agreements under this
Agreement. No act or failure to act of the Employee or IMI shall be deemed to be
an extension or waiver of timely or strict performance by the other of his/its
obligations, covenants and agreements under this Agreement.
8.4 Governing Law - This Agreement shall be governed by and construed
in accordance with the laws of the Province of Ontario and the law of Canada
applicable therein and each of the parties hereby irrevocably attorn to the
jurisdiction of the courts of the Province of Ontario.
8.5 Entire Agreement - This Agreement set forth the entire agreement
among the parties hereto pertaining to the employment of the Employee and
supersedes all prior agreements, understanding, negotiations and discussions,
whether oral or written, of the parties hereto, including, without limitation,
the employment agreement dated October 31, 1997 among the parties hereto, and
there are no warranties representations or other agreements between the parties
hereto in connection with the subject matter hereof except as specifically set
forth therein. No supplement, modification, waiver or termination of this
Agreement shall be binding unless executed in writing by the parties to be bound
thereby.
8.6 Assignment - This Agreement is personal to the Employee and may
not be assigned by him without the prior written consent of IMI, which consent
may be unreasonably withheld. This Agreement may not be assigned by IMI without
the prior written consent of the Employee, which consent may be unreasonably
withheld. Subject to the foregoing, this Agreement shall enure to the benefit of
and be binding upon the Parties and their respective successors, heirs,
executors, administrators, personal representatives and permitted assigns.
8.7 Headings - The headings used in this Agreement are for convenience
only and are not to be construed in any way as additions to or limitations of
the covenants and agreements contained herein.
8.8 Currency - All dollar amounts referred to in this Agreement shall
be in Canadian funds.
8.9 Time of Essence - Time is and shall always remain the essence of
this Agreement.
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IN WITNESS WHEREOF the parties hereto have executed this Agreement on
the day and year first above written.
IMI INTERNATIONAL MEDICAL
INNOVATIONS, INC.
Per /s/ Xxxxxx Xxxxxxxx c/s
---------------------------------
SIGNED, SEALED AND DELIVERED )
In the presence of: )
)
/s/ Xxxxx Xxxxxx )
------------------------------
Witness ) /s/ Xxxxxxx Xxxxxxx
) -------------------------------------
XXXXXXX XXXXXXX
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By signing, the Employee acknowledges he
understands the contents of this
Agreement, and in particular Article IV
relating to termination and that he has
been given the opportunity to obtain
independent legal advice and has either
done so or chosen not to obtain such
advice.
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