Employment Agreement [Amendment] - TLC The Laser Center Inc. and Elias Vamvakas
AMENDMENT TO EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of this 4th day of March, 1996,
B E T W E E N:
TLC THE LASER CENTER INC., a corporation
incorporated under the laws of the Province
of Ontario
(the "Corporation")
-and-
ELIAS VAMVAKAS, of the City of Richmond
Hill, in the Province of Ontario
(the "Executive")
RECITALS:
A. The Corporation is the parent company of a group of companies
(collectively, the "TLC Group") involved in the business of providing
excimer laser eye surgery and other secondary eye care services.
B. The Executive is currently an employee of the Corporation and/or the TLC
Group as well as a shareholder of the Corporation.
C. The Corporation and the Executive entered into an Agreement dated as of
January 1, 1996 (the "Employment Agreement") to set forth the rights and
obligations of each of them as regards the Executive's continuing
employment with the Corporation for their mutual benefit and to reflect
the nature of the Executive's employment by a corporation intending to
become a public corporation.
D. Pursuant to clause 8 of the Employment Agreement, the Corporation granted
to the Executive options (the "Original Options") to acquire 1,000,000
common shares in the capital of the Corporation at an option price of
$2.50 (Cdn.) per common share of which options to acquire 250,000 shares
were to have been exerciseable in each of the four years from the date of
the Employment Agreement on a cumulative basis. Each of the Original
Options were to expire on the earlier of (i) five years following the date
on which they would have become exerciseable, and (ii) 90 days following
termination of the Executive's employment under the Employment Agreement.
E. In connection with the initial public offering of common shares of the
Corporation and the application for listing of the common shares on The
Toronto Stock Exchange, The Toronto Stock Exchange has required that the
Original Options be replaced with options (the "New Options") exerciseable
at the issue price of US $3.00 per share (Cdn. $4.11 per share).
F. In order to ensure that the Executive is kept in substantially the same
economic position that he was in while he held the Original Options, the
Corporation will permit the
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Executive to apply the inherent value (the "Inherent Value") in the
Original Options towards the exercise of New Options prior to the closing
of the initial public offering on March 25, 1996. The Inherent Value is
equal to the number obtained when (a) the difference between (i) Cdn.
$2.50, and (ii) US $3.00 (Cdn. $4.11) is multiplied by (b) the number of
common shares subject to the Original Options held by the Executive. The
Inherent Value can be applied by the Executive as consideration for the
exercise of New Options at the issue price of Cdn.$4.11.
G. The Corporation and the Executive wish to amend clause 8 of the Employment
Agreement to reflect the replacement of the Original Options with the New
Options and to enter into a share option agreement which sets out the
terms and conditions relating to the New Options, including the vesting
and expiry dates of the New Options.
NOW THEREFORE in consideration of the mutual covenants and agreements contained
in this agreement and other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), the Corporation and the Executive
agree to amend the Employment Agreement as follows:
1. Clause 8 of the Employment Agreement is deleted in its entirety and replaced
with the following:
"The Corporation hereby grants to the Executive options to acquire
1,000,000 common shares in the capital of the Corporation at an option
price of $4.11 (Cdn.) per common share. The parties agree to enter into a
Share Option Agreement substantially in the form of Schedule A attached
hereto in order to set forth the terms and conditions relating to the
options herein granted."
IN WITNESS WHEREOF THE PARTIES HAVE EXECUTED THIS AGREEMENT.
TLC THE LASER CENTER INC.
By: /s/ John Riegert
---------------------------------
John Riegert
Chief Financial Officer
WITNESS: )
)
)
/s/ Janet Craig ) /s/ Elias Vamvakas
-------------------------------- ) ---------------------------------
) ELIAS VAMVAKAS
Janet Craig )
-------------------------------- )
Witness Name (Please Print) )
<PAGE>
SCHEDULE A
SHARE OPTION AGREEMENT
THIS AGREEMENT is made as of this 4th day of March, 1996,
B E T W E E N:
TLC THE LASER CENTER INC., a corporation
incorporated under the laws of the Province of
Ontario
(the "Corporation")
-and-
ELIAS VAMVAKAS, of the City of Richmond Hill, in
the Province of Ontario
(the "Executive")
RECITALS:
A. The Corporation and the Executive entered into an agreement dated as of
January 1, 1996, as amended by an agreement dated as of March 4, 1996 (the
"Employment Agreement") to set forth the rights and obligations of each of
them as regards the Executive's continuing employment with the Corporation
for their mutual benefit and to reflect the nature of the Executive's
employment by a corporation intending to become a public corporation.
B. Pursuant to clause 8 of the Employment Agreement, the Corporation has
granted to the Executive an option to acquire 1,000,000 common shares in
the capital of the Corporation at an option price of $4.11 (Cdn.) per
share. This Option replaces the option (the "Original Option") granted to
the Executive by the Corporation as of January 1, 1996 pursuant to clause
8 of the Employment Agreement, as such clause read prior to the amendment
of such clause by the Amendment to Employment Agreement made as of March
4, 1996 between the Corporation and the Executive.
C. The Corporation and the Executive wish to enter into this Share Option
Agreement to set forth the terms and conditions relating to the option
granted to the Executive pursuant to clause 8 of the Employment Agreement.
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NOW THEREFORE, in consideration of the mutual covenants and
agreements contained in this agreement and other good and valuable consideration
(the receipt and sufficiency of which are hereby acknowledged), the Corporation
and the Executive agree as follows:
Grant and Exercise of Options
1. The parties confirm that pursuant to clause 8 of the Employment Agreement.
the Corporation has granted to the Executive an option (the "Option") to acquire
1.000,000 common shares (the "Shares") in the capital of the Corporation at an
option price of $4.11 (Cdn.) per share. The Executive's rights to purchase
Shares pursuant to this Option will vest and expire as follows:
Vesting Date Number of Options Expiry Date(1) Aggregate Number
------------ Exercisable On or -------------- of Options
After Vesting Date Exercisable
------------------ ----------------
Immediately 391,727 January 1, 2001 Immediately:
391,727
March 25, 1996 152,069 January 1, 2001 March 25, 1996:
543,796
January 1, 1997 152,068 January 1, 2002 January 1, 1997:
695,864
January 1, 1998 152,068 January 1, 2003 January 1, 1998:
842,932
January 1, 1999 152,068 January 1, 2004 January 1, 1999:
1,000,000
(1) Subject to earlier expiration in accordance with the terms of this
Agreement.
The Corporation will permit the Executive to apply the inherent
value (the "Inherent Value") of the Original Option towards the exercise of the
Options granted to the Executive pursuant to clause 8 of the Employment
Agreement which vest immediately. However, the Executive's ability to apply the
Inherent Value to the exercise of the Option will expire on March 25, 1996. The
Inherent Value will be considered to have a fair value equal to that number
obtained when (a) the difference between (i) Cdn. $2.50 and (ii) Cdn. $4.11
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(US $3.00) is multiplied by (b) the number of Shares subject to the Original
Option held by the Executive.
The Executive's Inherent Value is calculated as follows:
The total number of Original Options granted to you as of
January 1, 1996 was:
1,000,000
Multiplied by: (i) $4.11 - (ii) $2.50 Cdn. $1.61
Total Inherent Value: Cdn. $1,610,000
In order to apply the Inherent Value of the Original Option toward
the exercise of the Options referred to above, please sign the Inherent Value
Exercise Form which is attached to this Agreement and return it to Janet Craig
at the Corporation's head office as soon as possible and in any event prior to
March 25, 1996.
2. Additional Terms of Exercise
Not less than 100 Shares may be purchased at any one time except
where the remainder totals less than 100. No fractional Shares may be issued and
the board of directors of the Corporation (the "Board") may determine the manner
in which fractional Share value will be treated. Subject to the foregoing, this
Option may be exercised in whole or in part in respect of vested Options at any
time prior to expiry of the relevant Options, by delivery of written notice to
the Corporation's head office to the attention of the Secretary of the
Corporation, specifying the number of Shares to be purchased, accompanied by
payment by bank draft or certified cheque of the total purchase price of the
Shares.
3. Termination, Retirement, Death or Departure
(a) If the Executive ceases to be an employee of the Corporation for any
reason whatsoever other than death, each Option held by the Executive will
cease to be exercisable 90 days after the date the Executive ceases to be
an employee of the Corporation. If any portion of an Option has not vested
by the Termination Date, that portion of the Option may not under any
circumstances be exercised by the Executive. Without limitation, and for
greater certainty only, this subsection (a) will apply regardless of
whether the Executive was dismissed with or without cause and regardless
of whether the Executive received compensation in respect of dismissal or
was entitled to a period of notice of termination which would otherwise
have permitted a greater portion of the Option to vest in the Executive.
(b) If the Executive dies, the legal representatives of the Executive may
exercise the Executive's Options within 180 days after the date of the
Executive's death but only to the extent the Options were by their terms
exercisable on the date of death. If the legal representative of the
Executive who has died exercises the Option in accordance with the
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terms of this Agreement, the Corporation will have no obligation to issue
the Shares until evidence satisfactory to the Corporation has been
provided by the legal representative that the legal representative is
entitled to purchase the Shares under this Agreement.
4. Payment of Option Price
The exercise price of each Share purchased under an Option must be
paid in full by bank draft or certified cheque at the time of exercise, and upon
receipt of payment in full, the number of Shares in respect of which the Option
is exercised will be duly issued as fully paid and non-assessable.
5. Share Certificates
Share certificates representing the number of Shares in respect of
which the Option has been exercised will be issued only upon payment in full of
the relevant exercise price. These share certificates will be held for
safekeeping by the Secretary of the Corporation, unless the Executive directs
the Secretary otherwise.
6. Amendment of Option Terms
With the consent of any applicable regulatory authorities (as
required) and the Executive, the Board may amend or modify any outstanding
Options in any manner to the extent that the Board would have had the authority
to initially grant the award as so modified or amended, including without
limitation, to change the date or dates as of which, or the price at which, an
Option becomes exercisable.
7. Right to Terminate Options on Sale of Corporation
Notwithstanding any other provision of this Agreement, if the Board
at any time by resolution declares it advisable to do so in connection with any
proposed sale or conveyance of all or substantially all of the property and
assets of the Corporation or any proposed merger, consolidation, amalgamation or
offer to acquire all of the outstanding Shares of the Corporation (collectively,
the "Proposed Transaction"), the Corporation may give written notice to the
Executive advising that the outstanding Options may be exercised only within 30
days after the date of the notice and not thereafter, and that all rights of the
Executive under any Options not exercised will terminate at the expiration of
the 30-day period, provided that the Proposed Transaction is completed within
180 days after the date of the notice. If the Proposed Transaction is not
completed within the 180-day period, no right under any Option will be affected
by the notice, except that the Option may not be exercised between the date of
expiration of the 30-day period and the day after the expiration of the 180-day
period.
8. Prohibition of Transfer of Options
Options are personal to the Executive. The Executive may deal with
any Options or any interest in them or transfer any Options now or hereafter
held by the Executive only in
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accordance with this Agreement. A purported transfer of any Options in violation
of this Agreement will not be valid and the Corporation will not issue any Share
upon the attempted exercise of improperly transferred Options. For the purposes
of this Agreement, the term "transfer" shall have the meaning ascribed to such
term in the Share Option Plan of the Corporation dated February 12, 1996.
9. Prohibition of Transfer of Shares
The Executive will not, upon exercise of an Option, deal with any
Share or any interest in it or transfer any Share now or hereafter held by the
Executive except in accordance with the Articles of the Corporation as
implemented by the Board.
10. Capital Adjustments
If there is any change in the outstanding Shares by reason of a
stock dividend or split, recapitalization, consolidation, combination or
exchange of shares, or other fundamental corporate change, the Board will make,
subject to any prior approval required of relevant stock exchanges or other
applicable regulatory authorities, if any, an appropriate substitution or
adjustment in (i) the exercise price of any unexercised Options; (ii) the number
or kind of shares reserved for issuance to the Executive; and (iii) the purchase
price of those shares subject to unexercised Options theretofore granted to the
Executive, and in the exercise price of those unexercised Options; provided,
however, that no substitution or adjustment will obligate the Corporation to
issue or sell fractional shares. In the event of the reorganization of the
Corporation or the amalgamation or consolidation of the Corporation with another
corporation, the Board may make such provision for the protection of the rights
of the Executive, as the Board in its discretion deems appropriate. The
determination of the Board, as to any adjustment or as to there being no need
for adjustment, will be final and binding on all parties.
11. Compliance with Legislation
The Board may postpone or adjust any exercise of any Option or the
issue of any Shares pursuant to this Agreement as the Board in its discretion
may deem necessary in order to permit the Corporation to effect or maintain
registration of this Agreement or the Shares issuable pursuant thereto under the
securities laws of any applicable jurisdiction, or to determine that the Shares
and this Agreement are exempt from such registration. The Corporation is not
obligated by any provision of this Agreement or any grant hereunder to sell or
issue Shares in violation of any applicable law. In addition, if the Shares are
listed on a stock exchange, the Corporation will have no obligation to issue any
Shares pursuant to this Agreement unless the Shares have been duly listed, upon
official notice of issuance, on a stock exchange on which the Shares are listed
for trading.
12. Restrictions on Resale of Shares
The Executive's right to resell Shares that the Executive purchases
pursuant to the exercise of any vested Options may be restricted in accordance
with applicable securities laws.
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The Executive should contact the Secretary of the Corporation or his legal
adviser for more details concerning these restrictions.
13. Governing Law
This Agreement will be governed by and construed in accordance with
the laws of the Province of Ontario.
IN WITNESS WHEREOF the parties have executed this Agreement.
TLC THE LASER CENTER INC.
By: /s/ John Riegert
---------------------------------
John Riegert
Chief Financial Officer
WITNESS )
)
)
/s/ Janet Craig ) /s/ Elias Vamvakas
-------------------------------- ) ---------------------------------
) ELIAS VAMVAKAS
Janet Craig )
-------------------------------- )
Witness Name (Please Print) )
<PAGE>
INHERENT VALUE EXERCISE FORM
TLC The Laser Center Inc.
206 Laird Drive, Suite 100
Toronto, Ontario
M4G 3W4
Attention: Janet Craig
Dear Sirs/Mesdames:
I hereby notify the Corporation that pursuant to the terms of the
Share Option Agreement dated March 4, 1996 (the "Share Option Agreement") made
between me and the Corporation, I wish to exercise options to acquire 391,727
common shares of the Corporation at an exercise price of $4.11 (Cdn.). I hereby
direct the Corporation to apply the Inherent Value of my Original Option toward
this exercise of Options. Words used herein and denoted by initial capital
letters have the respective meanings ascribed thereto in the Share Option
Agreement.
Yours truly,
/s/ Elias Vamvakas
Dated: March 18, 1996 -----------------------------
Elias Vamvakas
<PAGE>
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of this 1st day of January, 1996,
B E T W E E N:
TLC THE LASER CENTER INC., a corporation
incorporated under the laws of the Province of
Ontario
(the "Corporation")
-and-
ELIAS VAMVAKAS, of the City of Richmond Hill,
in the Province of Ontario
(the "Executive")
RECITALS:
A. The Corporation is the parent company of a group of companies
(collectively, the "TLC Group") involved in the business of providing
excimer laser eye surgery and other secondary eye care services.
B. The Executive is currently an employee of the Corporation and/or the TLC
Group as well as a shareholder of the Corporation.
C. The Corporation and the Executive wish to enter into this Agreement to set
forth the rights and obligations of each of them as regards the
Executive's continuing employment with the Corporation for their mutual
benefit and to reflect the nature of the Executive's employment by a
corporation intending to become a public corporation.
NOW THEREFORE IN CONSIDERATION OF THE MUTUAL COVENANTS AND AGREEMENTS CONTAINED
IN THIS AGREEMENT AND OTHER GOOD AND VALUABLE CONSIDERATION (THE RECEIPT AND
SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED), THE CORPORATION AND THE EXECUTIVE
AGREE AS FOLLOWS:
Definitions
1. In this Agreement,
"Agreement" means this agreement and all schedules attached to this
agreement, in each case as they may be amended or supplemented from time
to time;
"Business Day" means any day, other than Saturday, Sunday or any statutory
holiday in the Province of Ontario;
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"Competitive Business" means a business carried on in North America which
includes the financing, development and/or operation of excimer laser eye
surgery clinics or secondary eye care clinics in the geographic market
areas where the Corporation carries on or, to the knowledge of the
Executive at any time during the continuance of this Agreement, intends to
carry on, its business;
"Confidential Information" means all confidential or proprietary
information, Intellectual Property (including trade secrets) and
confidential facts relating to the business or affairs of the Corporation
or the TLC Group whether or not originated by the Executive including,
without limitation, work product resulting from or related to work or
projects performed or to be performed by the Corporation or the TLC Group,
internal personnel and financial information of the Corporation or the TLC
Group, purchasing and internal cost information, service and operational
manuals, the manner and method of conducting the business of the
Corporation or the TLC Group, marketing and development plans and
agreements, price and cost data, price and fee amounts, pricing and
billing policies, quoting procedures, marketing techniques, methods of
obtaining business, forecasts and forecast assumptions and volumes, future
plans and potential strategies of the Corporation or the TLC Group which
have been or are being discussed, ideas concerning proposed eye surgery
clinics, contracts and their contents, patient and affiliated doctor
services, data provided by patients and affiliated doctor, and the type,
quantity and specifications of products and services, purchased, leased,
licensed, engaged, employed or received by the Corporation or the TLC
Group or by clients of the Corporation or the TLC Group, business plans,
patients, affiliated doctor and vendor lists, business deals with any of
these, financing, acquisition, development, licensing and distribution
agreements and budgets and investment opportunities and structures;
"Disability" means the mental or physical state of the Executive such that
the Executive has been unable as a result of illness, disease, mental or
physical disability or similar cause, as determined by a legally qualified
medical practitioner selected by the Corporation, to fulfil the
Executive's obligations under this Agreement either for any consecutive
180 day period or for any period of 180 days (whether or not consecutive)
in any consecutive 365 day period and the cause so determined by such
medical practitioner falls within the definition of "disability" contained
in the disability insurance policy referred to in section 10(b) hereof;
"Employment Period" means the Term and renewals thereof;
"ESA" means the Employment Standards Act (Ontario) as the same may be
amended from time to time and any successor legislation thereto or similar
legislation governing the employment of the Executive;
"Intellectual Property" means all legally recognized rights which result
or derive from the Executive's services provided to the Corporation or the
TLC Group or with the knowledge, use or incorporation of Confidential
Information, and includes but is not limited to developments, inventions,
designs, works of authorship, improvements and ideas, whether or not
patentable or copyrightable, conceived or made by the Executive
(individually or in collaboration with others) during the Employment
Period or which
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result from or derive from the Corporation's or the TLC Group's resources
or which are reasonably related to the business of the Corporation or the
TLC Group;
"Just Cause" means: (i) the failure of the Executive to carry out his
duties after notice by the Corporation of the failure to do so and an
opportunity for the Executive to correct the same within a reasonable time
from the date of receipt of such notice, (ii) theft, fraud, dishonesty or
misconduct by the Executive involving the property, business or affairs of
the Corporation or the carrying out of the Executive's duties; or (iii)
any material breach or non-observance by the Executive of any term of this
Agreement;
"Person" means any individual, partnership, limited partnership, joint
venture, syndicate, sole proprietorship, company or corporation with or
without share capital, unincorporated association, trust, trustee,
executor, administrator or other legal personal representative, regulatory
body or agency, government or governmental agency, authority or entity
however designated or constituted;
"Term" has the meaning set out in section 3; and
"Year of Employment" means any 12 month period during the Employment
Period commencing on January 1, and ending on December 31.
2. Employment of the Executive
The Corporation will employ the Executive, and the Executive will
serve the Corporation, in positions assigned by the board of directors of the
Corporation from time to time that are consistent with the Executive's skills
and experience and comparable to the duties and positions held by the Executive
with the Corporation prior to the date of this Agreement. The Executive shall,
at the discretion of the board of directors of the Corporation, hold the office
of President, Chief Executive Officer and Chairman of the Board of Directors.
The Corporation may, by notice given in accordance with this Agreement, cause
the Executive to be employed by another member of the TLC Group designated by
the Corporation. If a designation of this sort is made, this Agreement will
govern the employment relationship between the Executive and the relevant member
of the TLC Group but the term "Corporation" will, unless the context requires
otherwise, be deemed to refer to the member of the TLC Group that employs the
Executive. The Executive will comply with all rules, regulations and
instructions of the Corporation now in force, or which may be adopted from time
to time, and communicated by the Corporation to its employees.
3. Employment Period
The Executive's employment will, subject to section 9, be for a term
of three years extending to December 31, 1998 (the "Term"). Commencing on
January 1, 1999, the Term shall be automatically extended for successive periods
of one year unless terminated by the agreement of the parties or pursuant to
section 9(c) or 9(d) hereof.
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4. Performance of Duties
During the Employment Period, the Executive will faithfully,
honestly and diligently serve the Corporation and the TLC Group. The Executive
will (except in the case of illness or accident) devote sufficient time and
effort so as to ensure the effective management of the Corporation and will use
his best efforts to promote the interests of the Corporation. The Executive
appreciates that his duties may involve significant travel, and agrees to travel
as reasonably required in order to fulfil his duties.
5. Remuneration
(a) Basic Remuneration. The Corporation will pay the Executive a gross
annual salary (the "Salary") in an amount equal to $225,000 (US) in
the first year of the Term, $250,000 (US) in the second year of the
Term, $275,000 (US) in the third year of the Term and thereafter
during successive annual renewals of the Term the Corporation will
pay the Executive a gross annual Salary in an amount determined by
the board of directors of the Corporation from time to time in
respect of each such successive year, provided that the Executive's
Salary in each such successive year shall be no less than that paid
in the previous year plus fifteen per cent. The foregoing Salary
payable in each year is before deduction for income taxes and other
required deductions, such as Canada Pension Plan and Unemployment
Insurance contributions, but excluding the Benefits paid by the
Corporation as provided in section 5(b)). The Salary will be payable
in equal installments semi-monthly in arrears in each month during
each Year of Employment, the first payment to be made on January 15,
1996.
(b) Benefits. The Corporation will provide to the Executive any benefits
provided from time to time to employees of the Corporation generally
including, without limitation, medical and dental insurance plans
and disability insurance (the "Benefits"). In addition, the
Executive will be entitled to participate in applicable fund, plan
or arrangement relating to senior executives of the Corporation in
effect generally from time to time with respect to the Corporation,
in accordance with and subject to the terms thereof.
(c) Bonus Remuneration. The Executive will be entitled to receive such
bonus remuneration, if any, in respect of each Year of Employment
during the Employment Period (including, without limitation, any
Year of Employment during which this Agreement terminates), as the
board of directors of the Corporation, in its sole discretion, may
authorize (the "Bonus").
6. Expenses
The Corporation will, upon presentation of expense statements or
receipts and such other supporting documentation as the Corporation may
reasonably require, pay or reimburse the Executive in accordance with the
Corporation's expense policies for all travel and out-of-pocket expenses
reasonably incurred or paid by the Executive in the performance of his duties
and responsibilities.
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7. Vacation
The Executive will be entitled during each Year of Employment during
the Employment Period to such period of vacation with pay as the board of
directors of the Corporation, in its sole discretion, may authorize, provided
that the Executive will be entitled to at least 4 weeks of vacation during each
Year of Employment. Vacation will be taken by the Executive at such time as may
be convenient to the Corporation having regard to its operations.
8. Options
The Corporation hereby grants to the Executive options to acquire
1,000,000 common shares in the capital of the Corporation at an option price of
$2.50 (Cdn.) per common share of which options to acquire 250,000 shares will be
exerciseable in each of the next four years on a cumulative basis. Each of the
foregoing options shall expire on the earlier of (i) 5 years following the date
on which they become exerciseable and (ii) ninety days following termination of
the Executive's employment hereunder. The parties agree to enter into such
additional documents as may be required to give effect to the options herein
granted.
9. Termination
(a) Notice. The Executive's employment may be terminated at any time:
(i) by the Corporation without prior notice and without further
obligations to the Executive for reasons of Just Cause or
Disability; or
(ii) in any other case, by the Corporation on 24 months' prior
written notice, provided that if, in the case of termination
by the Corporation under this clause 9(a)(ii), the Executive
is entitled under the ESA to a longer period of notice than
that prescribed above, the notice to be given by the
Corporation under this clause 9(a)(ii) will be that minimum
period of notice which is required under the ESA and no more.
Termination of the Executive's employment by the Corporation
pursuant to clause 9(a)(i) or clause 9(a)(ii) may be undertaken only
under the authority of a resolution of the aboard of directors
approved by 80% of the directors.
Subject to section 10 hereof, the Executive's employment will be
automatically terminated, without further obligation on the part of
the Corporation or the TLC Group (except as to the pro-rata payments
of amounts owing to such date) upon the Executive's death.
(b) Effective Date. The effective date on which the Executive's
employment will be deemed to have been terminated will be:
(i) in the case of termination under clause 9(a)(i) or 9(a)(ii),
the day on which the Executive is deemed, under section 19, to
have received notice from the Corporation of termination; and
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(ii) in the case of the death of the Executive, on the date of the
Executive's death.
(c) No Other Entitlement. Except as provided in this section 9 and
section 10, where the Executive's employment has been terminated by
the Executive or terminated or deemed to have been terminated by the
Corporation for any reason, the Executive will not be entitled,
except to the extent required under any mandatory employment
standard under the ESA, to receive any payment as termination pay,
severance pay, in lieu of notice, or as damages. Except as to any
entitlement as provided herein and in section 10 hereof, the
Executive hereby waives any claims the Executive may have against
the Corporation for or in respect of termination pay, severance pay,
or on account of loss of office or employment or notice in lieu
thereof or damages in lieu thereof (other than rights to accrued and
unpaid Salary and vacation pay, to reimbursement for expenses
pursuant to section 6, to the assignment to the Executive of any and
all insurance policies or health and dental insurance plans, if
assignable, and to the granting of any share options to which the
Executive is entitled in accordance with the terms of this
Agreement). Payments to the Executive upon termination by the
Corporation will be deemed to include and to satisfy entitlement to
termination pay and severance pay pursuant to the ESA to the extent
of such payments.
(d) The Executive may terminate his employment with the Corporation at
any time following the Term on not less than 120 days prior written
notice.
10. Termination Payment
(a) if this Agreement is terminated by the Corporation pursuant to
section 9(a)(i) for Just Cause, then the Corporation shall pay to
the Executive the minimum amount required to be paid in respect of
such termination by the ESA;
(b) if this Agreement is terminated by the Corporation pursuant to
section 9(a)(i) for Disability, the Corporation shall not be
required to make any termination, severance or other payment to
the Executive, provided that the Executive shall be entitled to
receive all disability payments payable to the Executive pursuant
to disability insurance maintained by the Corporation for the
benefit of the Executive. The Corporation covenants that
throughout the Employment Period it will maintain disability
insurance for the benefit of the Executive at at least the
insurable levels and on terms no less favourable to the Executive
than the disability insurance policy for the benefit of the
Executive existing on the date hereof, provided that the cost of
maintaining such insurance is not unreasonable as determined by a
vote of not less than 80% of the directors of the Corporation. If
such determination is made the parties agree within a reasonable
time thereafter to negotiate mutually acceptable alternative
arrangements. Notwithstanding the foregoing, but subject to such
mutually acceptable alternate arrangements if entered into, the
Corporation will for a period of 18 months following termination
of this Agreement pursuant to this section 10(b), pay to the
Executive the difference between (i) amounts received by the
Executive pursuant to disability insurance policy maintained by
the Corporation and (ii) 150% of the Salary and
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Bonus paid to the Executive during his last full year of employment
hereunder. Such amounts will be estimated and paid monthly to the
Executive with any necessary adjustments at the end of such 18 month
period;
(c) if this Agreement is terminated by the Corporation pursuant to
section 9(a)(ii) hereof, the Corporation shall pay to the Executive,
within 30 days of the effective date of such termination, an amount
equal to 24 months Salary determined by reference to the Executive's
salary in the current Year of Employment and a Bonus equal to twice
the average of the Bonus paid to the Executive in each of the
previous two years; and
(d) if this Agreement is terminated by reason of the death of the
Executive, the Corporation shall pay to the Executive's estate or
personal representatives all amounts owing to the Executive up to
and including the date of death together with a Bonus equal to that
percentage of the previous year's Bonus that is equal to the
percentage determined by dividing 365 the numerical day in the Year
of Employment that the Executive died and multiplying that product
by 100.
11. Return of Materials Upon Termination
Upon termination of the Executive's employment by the Corporation,
the Executive will promptly deliver to the Corporation all property of or
belonging to or administered by the Corporation or the TLC Group, including
without limitation all documents, manuals, customer, patient, affiliated doctor,
supplier, product and other proprietary lists, data, records, computer programs,
codes, materials, prototypes, products, samples, analyses, reports, marketing
materials, equipment, tools and devices relating or pertaining to any
Intellectual Property or Confidential Information, including all copies or
reproductions of the same
12. Non-Competition Agreement
The Executive acknowledges the competitive and proprietary nature of
the business carried on by the Corporation and the TLC Group and the interests
of the Corporation and the TLC Group in limiting, on a reasonable basis, the
availability of its employees and former employees to Competitive Businesses.
Accordingly, the Executive will not, either during the Employment
Period or for a period of 24 months thereafter, directly or indirectly, in any
manner whatsoever including, without limitation, either individually, or in
partnership, jointly or in conjunction with any other Person, or as employee,
principal, agent, director or shareholder
(a) be engaged in any undertaking;
(b) have any financial or other interest (including an interest by way
of royalty or other compensation arrangements) in or in respect of
the business of any Person which carries on a business; or
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(c) advise, lend money to, guarantee the debts or obligations of or
permit the use of the Executive's name or any part thereof by any
Person which carries on a business;
in North America, if the undertaking or the business, as the case may be, is a
Competitive Business.
Nothing in this section 12 will operate to prevent the Executive
from owning, on a passive investment basis, up to 5% of the issued shares of a
Competitive Business, the shares of which are traded on a recognized stock
exchange or traded in the over-the-counter market in Canada or elsewhere.
Notwithstanding the foregoing but subject to section 4 hereof, the
Corporation acknowledges that the Executive will, throughout the Employment
Period, continue to hold certain professional licences relevant to and will
continue to receive compensation from E.A. Vamvakas Insurance Agencies Limited
and Creative Planning Corporation Insurance Services, Inc. and the Corporation
agrees that such licenses and relationships shall not constitute a breach of
this section 12.
13. No-Solicitation of Employees or Consultants
The Executive acknowledges the importance to the business carried on
by the Corporation and the TLC Group of the human resources engaged and
developed by the Corporation and the TLC Group and the unique access that the
Executive's employment and other involvement with the Corporation and the TLC
Group offers to interfere with these resources. Accordingly, the Executive will
not, during the Employment Period and for the period of 24 months thereafter,
directly or indirectly, employ, be employed by, enter into a partnership or
other association with or retain as an independent contractor or be retained as
an independent contractor by any employee of or consultant to the Corporation or
the TLC Group or induce or solicit, or attempt to induce, any such person to
leave that person's employment or engagement.
14. Confidentiality
The Executive will not, during the Employment Period and at any time
thereafter, directly or indirectly, other than as required by his duties use or
disclose to any Person any Confidential Information unless:
(a) the Confidential Information is available to the public or in the
public domain at the time of such disclosure or use, without breach
of this Agreement or any similar agreement between the Corporation
and other employees or consultants; or;
(b) disclosure of the Confidential Information is required to be made by
any law, regulation, governmental authority or court, provided that
before disclosure is made, notice of the requirement is provided to
the Corporation, and (to the extent possible in the circumstances)
the Corporation is afforded an opportunity to dispute the
requirement for disclosure.
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The Executive's obligations under this section 14 are to remain in effect in
perpetuity and will exist and continue in full force and effect notwithstanding
any breach or repudiation or any alleged breach or repudiation of this Agreement
by the Corporation.
15. Copyright
During the Employment Period, the Executive agrees to disclose to
the Corporation all Intellectual Property developed by the Executive, either
individually or in collaboration with others, which relates directly or
indirectly to the business of the Corporation or the TLC Group. The Executive
acknowledges and agrees that all right, title and interest of any kind
whatsoever in and to the Intellectual Property, including the foregoing and any
copyrights, is and will be the exclusive property of the Corporation and the
Corporation will have absolute discretion to determine how such Intellectual
Property is used. All work done during the Employment Period by the Executive
for the Corporation or a member of the TLC Group is a work for hire under which
the Corporation or the member of the TLC Group, as the case may be, is the first
author for copyright purposes. Copyright will vest in the Corporation or the
relevant member of the TLC Group, as the case may be. The Executive hereby
waives all moral rights that the Executive may have in the Intellectual Property
and the Executive agrees that this waiver may be invoked by the Corporation, and
by any of its authorized agents or assignees, to use any of the Intellectual
Property. The Executive agrees that the Executive will execute all such
instruments and do all such things as may be reasonably necessary or desirable
to give full effect to the foregoing and will cooperate and assist the
Corporation and the TLC Group in enforcing their rights under this paragraph.
16. Certain Warranties, Covenants and Remedies
(a) The Executive agrees that the obligations of the Executive as set
forth in sections 11, 12, 13, 14 and 15 will be deemed to have
commenced as of the date on which the Executive was first employed
by the TLC Group. The Executive warrants that the Executive has not,
to date, breached any of the obligations set forth in any of these
sections.
(b) The Executive acknowledges that a material breach or threatened
material breach by the Executive of any of sections 11, 12, 13, 14
and 15 will result in the Corporation and its shareholders suffering
irreparable harm which is not capable of being calculated and which
cannot be fully or adequately compensated by the recovery of damages
alone. Accordingly, the Executive agrees that the Corporation will
be entitled to interim and permanent injunctive relief, specific
performance and other equitable remedies, in addition to any other
relief to which the Corporation may become entitled.
(c) The Executive's obligations under each of sections 11, 12, 13, 14
and 15 are to remain in effect in accordance with their terms and
will exist and continue in full force and effect notwithstanding any
breach or repudiation, or alleged breach or repudiation, of this
Agreement by the Corporation.
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17. Co-operation by Executive
The Executive will co-operate in all respects with the Corporation
if a question arises as to whether he has a Disability. Without limitation, the
Executive will authorize the Executive's medical doctor or other health care
specialist to discuss the condition of the Executive with the Corporation and
will as reasonably requested by the Corporation submit to examination by a
medical doctor or other health care specialist selected by the Corporation.
18. Citizenship and Residence
The Executive warrants that he is a Canadian citizen ordinarily
resident in Ontario and covenants that he will maintain his status as such
unless and until otherwise approved by the board of directors of the
Corporation. The Corporation will not, without agreement of the Executive,
require the Executive to relocate from the Municipality of Metropolitan Toronto.
19. Notices
Any notice or other communication required or permitted to be given
hereunder must be in writing, delivered by facsimile or by hand-delivery as
hereinafter provided. Any such notice or other communication, if sent by
facsimile, will be deemed to have been received on the Business Day following
the sending, or if delivered by hand to the Executive will be deemed to have
been received at the time it is delivered to him or, if delivered to the
Executive or the Corporation at applicable address noted below, when it is
delivered either to the individual designated below or to an individual at such
address having apparent authority to accept deliveries on behalf of the
addressee. Notice of change of address will also be governed by this section.
Notices and other communications must be addressed as follows:
(a) if to the Executive:
423 Weldrick Road East
Richmond Hill, Ontario
L4B 2M5
Attention: Mr. Elias Vamvakas
Telecopier number: (905) 770-7235
(b) if to the Corporation:
206 Laird Drive
Suite 100
Toronto, Ontario
M4G 3W4
Attention: Corporate Secretary
Telecopier number: (416) 467-6882
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20. Headings
The inclusion of headings in this Agreement is for convenience of
reference only and is not to affect the construction or interpretation hereof.
21. Invalidity of Provisions
Each of the provisions contained in this Agreement is distinct and
severable and a declaration of invalidity or unenforceability of any provision
by a court of competent jurisdiction will not affect the validity or
enforceability of any other provision hereof.
22. Entire Agreement
This Agreement constitutes the entire agreement between the parties
pertaining to the subject matter of this Agreement. This Agreement supersedes
and replaces all prior agreements, if any, written or oral, with respect to the
Executive's employment by the Corporation or the TLC Group and any rights which
the Executive may have by reason of any such prior agreement or by reason of the
Executive's prior employment, if any, by the Corporation or the TLC Group.
There are no warranties, representations or agreements between the parties in
connection with the subject matter of this Agreement except as specifically set
forth or referred to in this Agreement. No reliance is placed on any
representations, opinion, advice or assertion of fact made by the Corporation
the TLC Group or its directors, officers and agents to the Executive, except to
the extent that the same has been reduced to writing and included as a term of
this Agreement. Accordingly, there will be no liability, either in tort or in
contract, assessed in relation to any such representation, opinion, advice or
assertion of fact, except to the extent aforesaid.
23. Waiver, Amendment
Except as expressly provided in this Agreement, no amendment or
waiver of this Agreement will be binding unless executed in writing by the party
to be bound thereby. No waiver of any provision of this Agreement will
constitute a waiver of any other provision nor will any waiver of any provision
of this Agreement constitute a continuing waiver unless otherwise expressly
provided.
24. Employers and Employees Act
Section 2 of the Employers and Employees Act (Ontario) or other
similar provisions in the ESA will not apply to or in respect of this Agreement
or the employment of the Executive hereunder.
25. Governing Law
This Agreement will be governed by and construed in accordance with
the laws of the Province of Ontario.
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26. Counterparts
This Agreement may be signed in counterparts. Each counterpart will
constitute an original document and all counterparts, taken together, will
constitute one and the same instrument. Executed counterparts may be delivered
by telecopier.
27. Acknowledgement
The Executive acknowledges that:
(a) the Executive has had sufficient time to review and consider this
Agreement thoroughly;
(b) the Executive has read and understands the terms of this Agreement
and the Executive's obligations hereunder;
(c) the Executive has been given an opportunity to obtain independent
legal advice, or such other advice as the Executive may desire,
concerning the interpretation and effect of this Agreement; and
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(d) the Agreement is entered into voluntarily by the Executive.
IN WITNESS WHEREOF THE PARTIES HAVE EXECUTED THIS AGREEMENT.
TLC THE LASER CENTER INC.
By: /s/ John Riegert c/s
---------------------------------
John Riegert
Chief Financial Officer
WITNESS:
)
)
/s/ Ernest Belyea ) /s/ Elias Vamvakas
-------------------------------- ) ---------------------------------
) ELIAS VAMVAKAS
Ernest Belyea )
-------------------------------- )
Witness Name (Please Print) )