EXHIBIT 10.1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made and entered into effective May 21,
2001, between SONUS CORP., a Yukon Territory corporation ("Corporation"), and
XXXXXX X. XXXX ("Executive").
RECITALS
A. Executive will be Chief Executive Officer and a director of
Corporation.
B. Corporation recognizes that the future growth, profitability, and
success of the business of Corporation and its subsidiaries require, and will be
substantially and materially advanced by, the continued employment of Executive.
Corporation desires, therefore, to secure for Corporation and its affiliates the
continued benefit of Executive's experience, ability, and leadership. In order
to retain the services of Executive and to maximize the period of his continued
availability, and in recognition of his continuing contribution to Corporation's
success, Corporation desires to offer Executive the compensation, amenities, and
other benefits that executives of comparable experience and ability generally
receive.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, the parties agree as follows:
1. DEFINITIONS. As used in this Agreement, the following terms have
the meanings set forth in this Section 1:
"AFFILIATE" - Any person, firm, corporation, association,
organization, or unincorporated trade or business that, now or hereinafter,
directly or indirectly, controls, is controlled by, or is under common control
with Corporation.
"BOARD" - The board of directors of Corporation.
"CAUSE" - Cause for termination of employment means:
(i) A material act of fraud or dishonesty by Executive within
the course of performing his duties for Corporation or its Affiliates;
(ii) Gross negligence or intentional misconduct by Executive
in performing material duties for Corporation or its Affiliates, or
unjustifiable neglect by Executive of the performance of material duties
for Corporation or its Affiliates;
(iii) Commission of an act (or failure to take an action)
intentionally against the interest of Corporation or its Affiliates that
causes Corporation or an Affiliate material injury; or
(iv) An act of serious moral turpitude that causes Corporation
or an Affiliate material injury.
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Notwithstanding the foregoing, Executive will not be deemed to have
been terminated for Cause unless and until there has been delivered to Executive
a copy of a resolution duly adopted by the affirmative vote of not less than a
majority of the entire membership of the Board (excluding Executive), at a
meeting of the Board called and held for that purpose, finding that, in the good
faith opinion of the Board, Executive was guilty of conduct constituting Cause
as defined in this Agreement and specifying the particulars thereof in detail.
Executive must have been given reasonable notice of such meeting and Executive,
together with his counsel, must have been given an opportunity to be heard
before the Board at the meeting. This provision will not be deemed to restrict
the authority, discretion, or power of the Board, by any action taken in
compliance with Corporation's articles of incorporation and bylaws, to remove
Executive as an officer or director of Corporation, with or without Cause.
Rather, the foregoing provisions merely define, for purposes of Executive's
contractual rights and remedies under this Agreement, the circumstances in which
termination of Executive's employment will constitute termination for Cause.
"CHANGE IN CONTROL" - A change in control of Corporation means:
(i) The acquisition by any Person of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of
50 percent or more of the combined voting power of the then outstanding
Voting Securities; provided, however, that for purposes of this paragraph
(i), the following acquisitions will not constitute a Change of Control:
(A) any acquisition directly from Corporation, (B) any acquisition by
Corporation, (C) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by Corporation or any corporation
controlled by Corporation, (D) any acquisition by Warburg, Xxxxxx
Ventures, L.P. ("WPV") or by any Person that, now or hereinafter, directly
or indirectly controls, is controlled by, is under common control with, or
is otherwise an affiliate of, WPV, or (E) any acquisition by any
corporation pursuant to a transaction which complies with clauses (A),
(B), and (C) of paragraph (iii) below; or
(ii) individuals who, as of the date of this Agreement,
constitute the Board (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board; provided, however, that any
individual becoming a director subsequent to the date of this Agreement
whose election, or nomination for election by Corporation's shareholders,
was approved by a vote of at least a majority of the directors then
comprising the Incumbent Board will be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as
a result of an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than
the Board; or
(iii) consummation of a reorganization, merger, or
consolidation or sale or other disposition of all or substantially all of
the assets of Corporation (a "Business Combination") in each case, unless,
following such Business Combination, (A) all or substantially all of the
individuals and entities who were the beneficial owners of the Voting
Securities outstanding immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50 percent of,
respectively, the then
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outstanding shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the
election of directors, as the case may be, of the corporation resulting
from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns Corporation or all
or substantially all of Corporation's assets either directly or through
one or more subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Business Combination, of the Voting
Securities, (B) no Person (excluding WPV, any employee benefit plan (or
related trust) of Corporation or such corporation resulting from such
Business Combination) beneficially owns, directly or indirectly, 50
percent or more of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business Combination or the
combined voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the
Business Combination and (C) at least a majority of the members of the
board of directors of the corporation resulting from such Business
Combination were members of Incumbent Board at the time of the execution
of the initial agreement, or of the action of the Board, providing for
such Business Combination.
"COMPETITIVE ENTITY" - A Person, firm, or entity engaged in the
national or regional (in the United States or Canada) retail provision of
audiology services and/or dispensing of hearing aids.
"DISABILITY" OR "DISABLED" - Inability to perform duties with
Corporation on a full-time basis by reason of "Total Disability" within the
meaning of Corporation's Group Long Term Disability Insurance Plan or any
successor plan or program maintained by Corporation. In the event Corporation no
longer maintains a similar plan or program, Disability or Disabled means
inability to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment.
"EFFECTIVE DATE" - May 21, 2001.
"EXCHANGE ACT" - The Securities Exchange Act of 1934, as amended.
"GOOD REASON" - For all purposes of this Agreement, termination by
Executive of his employment with Corporation during the Employment Term for
"Good Reason" means termination based on any of the following:
(a) A change in Executive's status or position or positions
with Corporation that represents a material demotion from Executive's
status or position or positions as of the date of this Agreement or a
material change in Executive's duties or responsibilities that is
inconsistent with such status or position or positions;
(b) Removal of Executive as a member of the Board (other than
for cause or by reason of his failure to be re-elected to the Board);
(c) A reduction by Corporation in Executive's Base Salary (as
in effect on the date of this Agreement or as increased at any time during
the Term of this Agreement);
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(d) The failure of Corporation to continue Executive's
participation (on terms comparable to those for other key executives of
Corporation) in any Plans and vacation programs or arrangements in which
other key executives of Corporation are participants (unless such failure
to continue is caused by an action or status of Executive); or
(e) Corporation's requiring Executive to be based more than 35
miles from Corporation's principal executive office, except for required
travel on Corporation's business to an extent substantially consistent
with Executive's business travel obligations as of the date of this
Agreement.
"PERSON" - Any individual, corporation, partnership, limited
liability company, group, association, or other "person," as such term is used
in Section 13(d)(3) or Section 14(d) of the Exchange Act, other than Corporation
or any employee benefit plan or plans sponsored by Corporation.
"PLAN" - Any compensation plan such as a plan providing for
incentive or deferred compensation, stock options or other stock or
stock-related grants or awards, or any employee benefit plan such as a thrift,
investment, savings, pension, profit sharing, medical, disability, accident,
life insurance, cafeteria, or relocation plan or any other plan, policy, or
program of Corporation providing similar types of benefits to employees of
Corporation.
"SEVERANCE PAYMENTS" - The severance payments described in Section
5.4 of this Agreement.
"TERM" - The period from the Effective Date through May 21, 2004;
provided, however, that the Term will automatically be extended to May 21, 2005
(and thereafter will be similarly extended in additional one-year extensions)
unless, on or before December 31, 2003 (or, if the Term has been extended,
December 31 of the year immediately preceding the last year of the Term), either
Corporation or Executive gives written notice of non-extension of the Term.
"TERMINATION BENEFITS" - The payments and benefits described in
Section 5 of this Agreement.
"TERMINATION DATE" - The date Executive's employment with
Corporation is terminated for any reason by Corporation or by Executive.
"VOTING SECURITIES" - Corporation's issued and outstanding
securities ordinarily having the right to vote at elections of Corporation's
Board.
2. EMPLOYMENT AND MEMBERSHIP ON THE BOARD. Corporation hereby agrees
to employ Executive and retain Executive as a member of the Board, and Executive
hereby accepts employment with Corporation, during the Term of this Agreement on
the terms and conditions set forth in this Agreement. Corporation's agreement to
employ Executive and retain him as a director is subject to the reservations
provided in the definition of "Cause" in Section 1 and in Section 3.3.
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3. EXECUTIVE DUTIES.
3.1. Position and Duties. Executive agrees to render services to
Corporation as Chief Executive Officer and a member of the Board of Corporation
and as an executive officer of such of Corporation's Affiliates as the parties
to this Agreement mutually agree, including Affiliates that may be formed or
acquired subsequent to the Effective Date. As Chief Executive Officer of
Corporation, Executive will have responsibility for policy matters affecting
Corporation's business and will have such executive and managerial duties as the
Board prescribes from time to time.
3.2. Exclusive Employment. Executive agrees that during the Term of
this Agreement:
(a) Executive will devote substantially all his regular
business time (except during periods of vacation to which he is entitled,
illness and approved leaves of absence) solely and exclusively to the
business of Corporation, whether such business is operated directly by
Corporation or through one or more Affiliates of Corporation;
(b) Executive will diligently carry out his responsibilities
under this Agreement;
(c) Executive will not, directly or indirectly, without the
prior approval of the Board, provide services on behalf of any Competitive
Entity or on behalf of any subsidiary or affiliate of any such Competitive
Entity, as an employee, consultant, independent contractor, agent, sole
proprietor, partner, member, joint venturer, corporate officer, or
director;
(d) Executive will not acquire by reason of purchase the
ownership of more than 1 percent of the outstanding equity interest in any
Competitive Entity; and
(e) Except as expressly set forth above, Executive may engage
in personal business and investment activities.
3.3. Corporation Reserved Rights. Corporation reserves, on its own
behalf and on behalf of its shareholders, the right to elect, from time to time,
any person to its Board, to appoint any person as an officer of Corporation, and
to remove any officer or director, including Executive, in any manner and upon
the basis or bases presently or subsequently provided for by its articles of
incorporation and bylaws. Nothing in this Agreement will be deemed to constitute
any restriction on the authority, discretion, or power of the Board, but rather
will only give Executive contractual rights and remedies.
3.4. Nondisclosure. During and after the Term of this Agreement,
Executive agrees not to disclose to any persons with interests adverse or
potentially adverse to Corporation (other than an employee or agent of
Corporation or any Affiliate entitled to receive such information) confidential
information relating to the business of Corporation or any Affiliate and
obtained by Executive while providing services to Corporation or any Affiliate
without the
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consent of the Board, or until the information ceases to be confidential.
Notwithstanding the foregoing, Executive will not be precluded from making
disclosures respecting Corporation or any Affiliate where the disclosures are
made pursuant to compulsory legal process or when otherwise required by an
appropriate government agency.
4. COMPENSATION AND BENEFITS.
4.1. Base Salary. As compensation for the performance of Executive's
services hereunder, inclusive of services as an officer and director of
Corporation's Affiliates, Corporation will pay to Executive in accordance with
its normal payroll practices an annual salary (the "Base Salary") of $250,000
per year, subject to such increases (but not decreases) as are determined from
time to time by the Board, or a compensation committee designated by the Board.
4.2. Annual Bonus; Signing Bonus. (a) During the Term of this
Agreement, Executive will be eligible to receive an incentive bonus for each
fiscal year (beginning with the fiscal year ending July 31, 2002) (an "Annual
Bonus") in an amount (as determined by the Board) up to 100 percent of
Executive's Base Salary for such fiscal year. The Annual Bonus for each fiscal
year will be payable no later than 120 days following the end of each fiscal
year.
(b) As soon as practible after the Effective Date, Executive will be
paid a one-time signing bonus of $25,000.
4.3. Stock Options. (a) On the Effective Date, Executive will be
granted options (the "Options") to purchase 850,000 shares of the Corporation's
common stock under the Corporation's Stock Award Plan (the "Plan") at a price
equal to the fair market value of the common stock on the Effective Date. The
Options will vest as to 25% of the shares on May 21, 2002, and thereafter as to
an additional 6 1/4% of the shares on each succeeding three month anniversary of
May 21, 2002 (i.e., July 21, 2002, October 21, 2002, and so on) until May 21,
2005 (each, a "Vesting Date"), provided Executive continues to be employed by
the Corporation.
(b) The Options will become immediately and fully exercisable in the
event that, within two years following a Change in Control of Corporation,
Executive is terminated without Cause or the Executive resigns for Good Reason.
(c) In the event that, prior to a Change in Control of Corporation,
or more than two years following a Change in Control, Executive's employment is
terminated by Corporation without Cause or by Executive for Good Reason, the
Options will become exercisable as of the date of such termination to the
following extent:
(i) The portion of the Options that become exercisable prior
to the Termination Date will remain exercisable; and
(ii) The Options will become fully exercisable as of the
Termination Date as to the sum of (a) the number of
shares that would have become exercisable over the
twelve months following the Termination Date had
Executive's employment not terminated, plus (b) a pro
rata portion of the number of shares that would have
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become exercisable as of the Vesting Date next
succeeding the date which is twelve months following the
Termination Date, determined by multiplying 53,125
(i.e., .0625 x 850,000) by ratio of (I) the number of
days elapsed between the Termination Date and the last
Vesting Date which occurred prior to the Termination
Date, to (II) 91.
(d) The Options will be subject to terms of the Plan and a customary
award agreement for options granted under the Plan.
(e) Vested Options will remain exercisable for 90 days after
termination of employment or, in the case of termination due to death or
Disability, for one year.
4.4. Other Benefits. During the Term of this Agreement, Executive
will be entitled to participate in all Plans (including Plans adopted following
the Effective Date) covering Corporation's key executive and managerial
employees as described in Corporation's employee manual, as amended from time to
time, including, without limitation, Plans providing medical, disability, and
life insurance benefits, and vacation pay. For purposes of the Corporation's
paid time off policy, Executive will be treated as an employee with at least
seven years of service.
4.5. Expenses. (a) Executive is authorized to incur on behalf of
Corporation, and Corporation will directly pay or will fully reimburse Executive
for all customary and reasonable out-of-pocket expenses incurred for promoting,
pursuing, or otherwise furthering the business of Corporation or its affiliates.
(b) During such period as Executive's permanent residence is not in
the vicinity of Corporation's principal offices, Corporation will reimburse
Executive for reasonable apartment and car rental expenses, up to a maximum of
$5,000 per month.
4.6. Supplemental Insurance Benefits. Corporation will pay up to
$15,000 per year during the Term for premiums on supplemental life and
disability insurance for Executive.
5. TERMINATION OF AGREEMENT.
5.1. Death. If Executive dies prior to the expiration of the Term of
this Agreement, Corporation will pay to Executive's representative his Base
Salary through the date of death. All benefits, including death benefits, to
which Executive is then entitled under Plans in which Executive is a participant
will be payable as provided in those Plans. This Agreement will terminate as of
the date of death and Corporation will have no further obligations to Executive
under this Agreement.
5.2. Disability. In the event Executive becomes Disabled during the
Term, the Agreement will remain in effect and Executive will be entitled to
continue to receive the compensation and benefits described in Section 4 until
the expiration of the Term with the following modifications:
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(a) The Annual Bonus, if any, that otherwise would be earned
by Executive for the year in which his employment is terminated by reason
of Disability (the "Disability Year") will be prorated based on the number
of days before and after the Termination Date;
(b) Executive will not be entitled to any Annual Bonus for
years following the Disability Year; and
(c) The amounts otherwise payable to Executive as Base Salary
following the Termination Date will be reduced by the amount, if any, of
benefits paid to Executive under Corporation's Group Long Term Disability
Insurance Plan. To the extent allowable under applicable law and other
Corporation Plans, Executive will be treated as an employee of Corporation
during the period after the Termination Date and through the end of the
Term for purposes of this Agreement and the Plans in which Executive is a
participant.
5.3. Termination for Cause or Voluntary Termination Without Good
Reason. Pending the determination by the Board whether or not Cause exists for
termination of Executive's employment pursuant to the definition of Cause in
Section 1, the Board may suspend Executive or relieve Executive of his duties as
an officer, but may not terminate Executive's employment. Upon such
determination that Cause exists, Corporation may terminate Executive's
employment. If Corporation terminates Executive's employment for Cause or
Executive terminates employment other than for Good Reason, Corporation will pay
Executive his Base Salary through the effective date of such termination and,
only if Corporation elects, additional compensation equal to one-half of
Executive's Base Salary for the period during which Executive is obligated not
to compete pursuant to Section 5.7 of this Agreement. This Agreement will
terminate as of the Termination Date, and Corporation will have no further
obligations to Executive under this Agreement. All accrued benefits to which
Executive is then entitled under Plans in which he is a participant will be
payable as provided in those Plans.
5.4. Termination Without Cause or With Good Reason. If Executive's
employment with Corporation is terminated (other than for Disability or upon
Executive's death) by Corporation without Cause or by Executive with Good
Reason, Corporation will pay Executive the following amounts ("Severance
Payments"):
(a) Executive's Base Salary through the Termination Date; and
(b) In lieu of any further salary payments to Executive for
periods subsequent to the Termination Date, an amount of severance pay
(payable in 24 substantially equal monthly installments commencing on the
first day of the first calendar month beginning after the Termination
Date) equal to two times the sum of:
(i) Executive's Base Salary, at the rate in effect on
the Termination Date, and
(ii) The average Annual Bonus (if any) paid to Executive
or accrued to his benefit (the "Average Bonus") in respect of
the two fiscal
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years last ended prior to the fiscal year in which the
Termination Date occurs. For purposes of this Section
5.4(b)(ii), if the Termination Date is prior to the date that
Executive's Annual Bonus for the fiscal year ending July 31,
2003, has been determined by the Board, the Average Bonus will
be the amount of the Annual Bonus paid to Executive for the
fiscal year ending July 31, 2002.
5.5. Related Benefits. Except in connection with Executive's death
or termination by Corporation for Cause or Disability or by voluntary
termination by Executive without Good Reason, Corporation will retain in full
force and effect for the continued benefit of Executive for two years after the
Termination Date all Plans in which Executive was entitled to participate
immediately prior to the Termination Date, provided that Executive's continued
participation is possible under the general terms and provisions of such Plans;
provided, however, that if the participation by Executive in any Plan is barred
by the provisions of such Plan, Corporation will arrange to provide Executive
with benefits substantially similar to those to which Executive is entitled to
receive under such Plan (provided, however, that the cost of such benefits does
not exceed 125 percent of the prevailing cost of similar benefits under
Corporation's Plans).
5.6. No Mitigation. Executive will not be required to mitigate the
amount of any payment provided for in this Section 5 by seeking other employment
or otherwise. However, except in the case of a termination of Executive without
Cause or with Good Reason within two years following a Change in Control of
Corporation, the amount of any payment or related benefit provided for in this
Section 5 will be reduced by any compensation earned or related benefit received
by Executive as a result of either employment by another employer or
self-employment after the Termination Date. Executive agrees to provide
Corporation with any information reasonably necessary to determine the amount of
such reduction.
5.7. Noncompetition Following Termination. Executive acknowledges
that the agreements and covenants contained in this Section 5.7 are essential to
protect the value of Corporation's business and assets and that, by his current
employment with Corporation and its subsidiaries, Executive has obtained and
will obtain such knowledge, contacts, know-how, training and experience, and
that such knowledge, contacts, know-how, training and experience could be used
to the substantial advantage of a Competitive Entity and to Corporation's
substantial detriment. Therefore Executive agrees that:
(a) In the event Executive's employment is terminated (whether
by Corporation or by Executive) for any reason before the expiration of
the Term, Executive will not, for a period of two years from the
Termination Date, participate (as an owner, employee, officer, partner,
member, shareholder, director, consultant, or otherwise) in any
Competitive Entity. The benefits payable under this Agreement, including
without limitation Corporation's obligation to pay Severance Benefits
pursuant to Section 5.4 of this Agreement, and, if Corporation so elects,
the additional compensation provided in Section 5.3 of this Agreement, are
in consideration of Executive's performance of the covenants in this
Section 5.7.
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(b) Executive acknowledges that pursuant to the terms of this
Agreement, he is receiving a "bona fide advancement" in terms of his
employment with Corporation within the meaning of ORS 653.295. Executive
further acknowledges that he is receiving consideration under this
Agreement in addition to such consideration as to which he would be
entitled in the absence of this Agreement, and he acknowledges that his
agreement to the provisions of this Section 5.7 is a necessary condition
for Corporation to enter into this Agreement and pay the consideration
provided for in this Agreement.
(c) Executive acknowledges that Corporation's remedy at law
for a breach by him of the provisions of this Section 5.7 will be
inadequate. Accordingly, in the event of the breach or threatened breach
by Executive of any provision of this Section 5.7, Corporation will be
entitled to injunctive relief in addition to any other remedy it may have.
If any of the provisions of, or covenants contained in, this Section 5.7
are hereafter construed to be invalid or unenforceable in any
jurisdiction, the same will not affect the remainder of the provisions or
the enforceability thereof in any other jurisdiction, which will be given
full effect, without regard to the invalidity or unenforceability in such
other jurisdiction. If any of the provisions of, or covenants contained
in, this Section 5.7 are held to be unenforceable in any jurisdiction
because of the duration or geographical scope of such provision or
covenant, Executive and Corporation agree that the court making such
determination will have the power to reduce the duration or geographical
scope of such provision or covenant and that, in its reduced form, such
provision or covenant will be enforceable; provided, however, that the
determination of such court will not affect the enforceability of this
Section 5.7 in any other jurisdiction.
6. EFFECT OF CHANGE IN CONTROL. The Severance Benefits payable under
Section 5.4 of this Agreement are not conditioned upon a Change in Control of
Corporation but are payable upon any termination described in that Section,
whether or not a Change in Control has occurred. Thus, it is the parties' mutual
intention that the Severance Benefits are not to be treated as payments in
connection with a Change in Control.
7. SUCCESSORS; BINDING EFFECT.
7.1. Corporation. This Agreement will inure to the benefit of, and
be binding upon, any corporate or other successor or assignee of Corporation
that acquires, directly or indirectly, by merger, consolidation or purchase, or
otherwise, all or substantially all the business or assets of Corporation.
Corporation will require any such successor, by an agreement in form and
substance reasonably satisfactory to Executive, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent as Corporation
would be required to perform if no such succession had taken place.
7.2. Executive. This Agreement will inure to the benefit of and be
enforceable by Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees, and legatees. If
Executive should die while any amount would still be payable to Executive
hereunder if Executive had continued to live, all such amounts, unless
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otherwise provided herein, will be paid in accordance with the terms of this
Agreement to Executive's devisee, legatee, or other designee or, if there is no
such designee, to Executive's estate.
8. WAIVER AND MODIFICATION. Any waiver, alteration, or modification
of any of the terms of this Agreement will be valid only if made in writing and
signed by the parties to this Agreement. No waiver by either of the parties of
its rights under this Agreement will be deemed to constitute a waiver with
respect to any subsequent occurrences or transactions hereunder unless the
waiver specifically states that it is to be construed as a continuing waiver.
9. GOVERNING LAW; SEVERABILITY. The validity, interpretation,
construction, and performance of this Agreement will be governed by and
construed in accordance with the laws of the state of Oregon. Any provision of
this Agreement that is prohibited or unenforceable will be ineffective only to
the extent of that prohibition or unenforceability without invalidating the
remaining provisions of this Agreement.
10. NOTICES. For the purposes of this Agreement, notices and all
communications provided for in this Agreement must be in writing and will be
deemed to have been given upon the earlier of (i) personal delivery or (ii)
three business days after being mailed by United States registered mail, return
receipt requested, with postage prepaid, addressed to the respective party at
the address set forth below (or to such other address as either party may have
furnished to the other in writing in accordance with this Section 9, except that
notices of change of address will be effective only upon receipt):
To Corporation: Sonus Corp.
000 X.X. Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxx, Xxxxxx 00000
Attn: Xxxxx Xxxxxxxx, Corporate Counsel
To Executive: Xxxxxx X. Xxxx
0000 Xxxxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
11. HEADINGS. Headings herein are for convenience only, are not a
part of this Agreement, and are not to be used in construing this Agreement.
12. ARBITRATION. Any dispute or claim that arises out of or that
relates to this Agreement or to the interpretation, breach, or enforcement of
this Agreement, must be resolved by mandatory arbitration in accordance with the
then effective arbitration rules of Arbitration Service of Portland, Inc., and
any judgment upon the award rendered pursuant to such arbitration may be entered
in any court having jurisdiction thereof.
13. ATTORNEYS' FEES. In the event of any suit or action or
arbitration proceeding to enforce or interpret any provision of this Agreement
(or which is based on this Agreement), the prevailing party will be entitled to
recover, in addition to other costs, reasonable attorneys' fees in connection
with such suit, action, arbitration, and in any appeal. The determination of who
is the prevailing party and the amount of reasonable attorneys' fees to be
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paid to the prevailing party will be decided by the arbitrator or arbitrators
(with respect to attorneys' fees incurred prior to and during the arbitration
proceedings) and by the court or courts, including any appellate courts, in
which the matter is tried, heard, or decided, including the court which hears
any exceptions made to an arbitration award submitted to it for confirmation as
a judgment (with respect to attorneys' fees incurred in such confirmation
proceedings).
14. EFFECT OF TERMINATION OF AGREEMENT. If this Agreement is
terminated, all rights and benefits that have become vested hereunder prior to
termination will remain in full force and effect, and the termination of the
Agreement will not be construed as relieving any party from the performance of
any accrued obligation incurred to the other under this Agreement.
15. ENTIRE AGREEMENT. This Agreement constitutes and embodies the
entire understanding and agreement of the parties hereto relating to the matters
addressed in this Agreement. Except as otherwise provided in this Agreement,
there are no other agreements or understandings, written or oral, in effect
between the parties relating to the matters addressed herein.
IN WITNESS WHEREOF, the parties hereto have entered into this
Agreement effective as of the Effective Date.
CORPORATION: SONUS CORP.
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chairman
EXECUTIVE: /s/ Xxxxxx X. Xxxx
------------------------------------------
Xxxxxx X. Xxxx
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