EXHIBIT 4.15
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EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") dated as of May 30, 2000, is entered
into by and between EXFO Electro-Optical Engineering Inc., a corporation having
its principal place of business at 465 Godin Avenue, Vanier, Quebec, G1M 3G7,
Canada (the "Corporation") and Mario Larose, an individual with an address at 20
Anse-a-Beaufils, Laval, Quebec, H7Y 1V4 (the "Employee").
TERMS OF AGREEMENT
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In consideration of this Agreement and the continued employment of the Employee
by the Corporation, the parties agree as follows:
1. EMPLOYMENT
The Corporation hereby agrees to employ Employee, on a full-time basis
commencing on or about June 12, 2000, to act as Vice President,
Marketing of the Corporation and to perform such acts and duties and
furnish such services to the Corporation in connection with and related
to that position as is customary for persons with similar positions in
like companies, as the Corporation's President and Chief Executive
Officer shall from time to time reasonably direct. Employee hereby
accepts said employment. Employee shall use his best and most diligent
efforts to promote the interests of the Corporation; shall discharge
his duties in a highly competent manner; and shall devote his full
business time and his best business judgement, skill and knowledge to
the performance of his duties and responsibilities hereunder. This
Agreement shall not be interpreted to prohibit Employee form making
passive personal investments or conducting private business affairs if
such activities do not materially interfere with the services required
under this Agreement. Employee shall report to the President and Chief
Executive Officer of the Corporation.
2. COMPENSATION AND BENEFITS
2.1 SALARY
During the term of this Agreement, the Corporation shall pay
Employee the remuneration indicated in Schedule A. The
Employee's remuneration may be adjusted in accordance with the
Corporation's policies and procedures.
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2.2 DISCRETIONARY BONUS
During the term of this Agreement, the Employee may
participate in such bonus plan or plans of the Corporation as
the Board of Directors, acting through its Human Resources
Committee, may approve for the Employee. Nothing contained in
this Section 2.2 shall be construed to require the Board of
Directors to approve a bonus plan or in any way grant to
Employee the right to receive bonuses not otherwise approved.
2.3 BENEFITS
During the term of this Agreement, the Employee shall receive
such benefits as customarily provided to other officers and
employees of the Corporation. Details of such benefits as of
the date hereof are set forth in Schedule B of this Agreement.
2.4 VACATION
Employee may take paid vacation during each year as set forth
in Schedule A at such times as shall be consistent with the
Corporation's vacation policies and (in the Corporation's
judgement) with the Corporation's vacation schedule for
officers and other employees.
2.5 EXPENSES
Pursuant to the Corporation's customary policies in force at
the time of payment, Employee shall be promptly reimbursed,
against presentation of vouchers or receipts therefor, for all
authorised expenses properly incurred by him on the
Corporation's behalf in the performance of his duties
hereunder.
3. TERMINATION
3.1 DISABILITY
If during the term of this Agreement, Employee becomes ill,
disabled or otherwise incapacitated so as to be unable to
perform his usual duties (a) for a period in excess of one
hundred and eighty (180) consecutive days, or (b) for more
than one hundred eighty (180) days in any consecutive twelve
(12) month period and this incapacity has not been remedied by
the end of the twelfth (12th) month of such consecutive twelve
(12) month period, then the Corporation shall have the right
to terminate this Agreement, subject only to applicable laws,
on thirty (30) day's notice to Employee. Termination pursuant
to this Section 3.1 shall not affect any rights Employee may
otherwise have under any disability insurance policies in
effect at the time of such termination.
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3.2 DISCHARGE FOR CAUSE
The Corporation may discharge Employee and terminate his
employment under this Agreement for cause without further
liability to the Corporation by a majority vote of the Board
of Directors of the Corporation except that the Employee, if a
Director, shall not be entitled to vote thereon. As used in
this Section 3.2, "cause" shall mean any or all of the
following;
(a) gross or wilful misconduct of Employee during the
course of his employment;
(b) conviction of any criminal offence involving
dishonesty, breach of trust or moral turpitude during
the term of this Agreement; or
(c) the definition given to the term "with cause", or
other similar terms, by applicable laws and
jurisprudence in the province of Quebec.
3.3 TERMINATION WITHOUT CAUSE
Upon thirty (30) days prior written notice, the Corporation
may terminate this Agreement without cause by a majority vote
of the Board of Directors of the Corporation except that the
Employee, if a Director, shall not be entitled to vote
thereon. The Corporation shall incur no liability in this
regard except that it shall continue to pay Employee the
remuneration in accordance with the terms set forth in
Schedule A at his then current rate for a twelve (12) month
period after termination if termination shall occur prior to
the events mentioned in Section 3.4.
3.4 TERMINATION FOLLOWING MERGER OR ACQUISITION
If the Corporation merges or consolidates with another
corporation, if substantially all of the assets of the
Corporation are sold, or if a majority of the outstanding
stock of the Corporation is acquired by another person and
Employee's employment is subsequently terminated by the
Corporation or surviving entity other than for cause as
described in 3.2, Employee shall be entitled to severance
benefits as described below based on length of service with
the Corporation:
LENGTH OF SERVICE SEVERANCE BENEFITS
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0 to 24 months 12 months' remuneration plus health
benefits;
24 to 48 months 18 months' remuneration plus health
benefits;
more than 48 months 24 months' remuneration plus health
benefits.
For purposes of this Section 3.4, Employee shall be entitled
to treat a material demotion in title or function as
termination under this Section 3.4, but only if
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Employee expressly so notifies the Corporation and terminates
his employment hereunder within thirty (30) days of such
demotion or relocation. If Employee is offered a substantially
similar position with the surviving entity, Employee's refusal
to accept such position shall not be treated as subject to
this Section 3.4, but rather shall be treated as a voluntary
termination by Employee under Section 3.5.
3.5 VOLUNTARY TERMINATION BY EMPLOYEE
The Employee shall give prior written notice to the
Corporation of at least one (1) month if he voluntarily
terminates this Employment Agreement. In the event of
voluntary termination by Employee, Employee shall be entitled
only to those amounts that have accrued to the date of
termination in accordance with the terms hereof or are
expressly payable under the terms of the Corporation's
applicable benefit plans or are required by applicable law.
The Corporation may, in its sole and absolute discretion,
confer such other benefits or payments as it determines, but
Employee shall have no entitlement thereto.
4. MISCELLANEOUS
4.1 INSURANCE
The Corporation hereby represents that it is presently the
holder of directors and officers insurance in an amount and
having a coverage that is recommended by its legal advisors
and insurance broker as adequate taking into account the
status of the Corporation, its size and the nature of its
activities. The Corporation undertakes to ensure that such
insurance shall remain in force throughout the term of this
Agreement and in the event such insurance is cancelled, the
Corporation shall immediately advise the Employee in writing.
4.2 ADDITIONAL AGREEMENTS
Upon execution of this Agreement, the Employee shall execute
and deliver to the Corporation, unless previously delivered,
an Exclusivity, Confidentiality, Assignment of Work Product,
Non-Competition and Non-Solicitation Agreement.
4.3 NOTICES
Any notice or communication given by any party hereto to the
other party shall be in writing and personally delivered or
mailed by certified mail, return receipt requested, postage
prepaid, to the addresses provided above. All notices shall be
deemed given when actually received. Any person entitled to
receive notice (or a copy thereof) may designate in writing,
by notice to the others, such other address to which notices
to such person shall thereafter be sent.
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4.4 ENTIRE AGREEMENT
This Agreement contains the entire understanding of the
parties in respect of its subject matter and supersedes all
prior agreements and understandings between the parties with
respect to such subject matter, provided, however that nothing
in this Agreement shall affect the Employee's obligations
under the Exclusivity, Confidentiality, Assignment Of Work
Product, Non-Competition And Non-Solicitation Agreement signed
by the Employee.
4.5 AMENDMENT OR WAIVER
This Agreement may not be amended, supplemented, cancelled or
discharged, except by written instrument executed by the party
affected thereby. No failure to exercise, and no delay in
exercising, any right, power or privilege hereunder shall
operate as a waiver thereof. No waiver of any breach of any
provision of this Agreement shall be deemed to be a waiver of
any preceding or succeeding breach of the same or any other
provision.
4.6 BINDING EFFECT, ASSIGNMENT
Employee's rights or obligations under this Agreement may not
be assigned by Employee. The rights and obligations set forth
in this Agreement shall bind and inure to the benefit of the
Corporation and its successors and assigns. The Corporation
will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the
Corporation to assume expressly and agree to perform this
Agreement in the same manner and to the same extent that the
Corporation would be required to perform it as if no such
event had taken place. As used in this Agreement,
"Corporation" shall mean the Corporation as herein before
defined any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement
by operation of law, or otherwise.
4.7 HEADINGS
The headings contained in this Agreement are for reference
purposes only and shall not affect the meaning or
interpretation of this Agreement.
4.8 GOVERNING LAW, INTERPRETATION
This Agreement shall be construed in accordance with and
governed for all purposes by the laws applicable in the
province of Quebec. Service of process in any dispute shall be
effective (a) upon the Corporation, if service is made on any
officer of the Corporation other than the Employee; (b) upon
the Employee, if served at Employee's residence last known to
the Corporation with an information copy to the Employee at
any other residence, or care of a subsequent employer, of
which the Corporation may be aware.
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4.9 FURTHER ASSURANCES
Each of the parties agrees to execute, acknowledge, deliver
and perform, or cause to be executed, acknowledged, delivered
and performed at any time, or from time to time, as the case
may be, all such further acts, deeds, assignments, transfers,
conveyances, powers of attorney and assurances as may be
necessary or proper to carry out the provisions or intent of
this Agreement.
4.10 LANGUAGE
This Agreement has been written in English at the express
request of the parties. Cette entente a ete redigee en anglais
a demande expresse des parties.
4.11 SEVERABILITY
If any one or more of the terms, provisions, covenants or
restrictions of this Agreement shall be determined by a court
of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected,
impaired or invalidated.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
EXFO ELECTRO-OPTICAL
ENGINEERING INC.
BY: /s/ Germain Lamonde /s/ Mario Larose
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GERMAIN LAMONDE MARIO LAROSE
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SCHEDULE A
TO
MARIO LAROSE EMPLOYMENT AGREEMENT
REMUNERATION AND VACATION
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1. REMUNERATION
(i) Salary from commencement of employment to August 31, 2000:
$180,000 per annum (no variable portion applicable during this
period).
(ii) Remuneration from September 1, 2000 to August 31, 2001: Base
salary of $140,000 per annum, plus a variable portion of
remuneration which is $50,000 per annum upon attainment by the
Corporation of 100% of the Health Indicator established by the
Board of Directors of the Corporation for that financial year.
In the event the Corporation (a) does not fully attain, or (b)
exceeds, the Health Indicator for the year in question, the
variable portion of the remuneration shall be paid in the same
proportion as the attainment of the Health Indicator up to a
maximum of 150% of the Health Indicator. The variable portion
shall be paid within sixty (60) days of the end of each of the
Corporation's financial years commencing with the financial
year ending August 31, 2001.
In the event the Employee's employment is terminated by the
Corporation with cause or the Employee voluntarily terminates
his employment, the variable portion of the remuneration shall
not be payable for the financial year during which the
employment terminated for such reasons.
(iii) Participation in the Corporation's Stock Option Plan: At the
time of the Corporation's initial public offering, the
Employee shall be granted 20,000 options in accordance with
the terms of the Stock Option Plan and subject to vesting
conditions that extend over 4 years, up to a maximum of 5
years, and that are tied to the Corporation's Health Indicator
(full details will be available at the granting of the
options).
(iv) The Employee, living in the Montreal area as of the date
hereof, shall be required to work in Quebec City. As a result,
the Corporation shall pay a total amount of $20,000 to assist
Employee in the transition and relocation of Employee's
principal residence to the Quebec City area. This amount shall
be paid in monthly instalments of $833.33 each for a period
not to exceed twenty-four (24) months from the date of the
commencement of employment and shall be deemed to cover all of
Employee's travel expenses between his principal residence and
his accommodations in Quebec City. No other amounts shall be
paid by the Corporation to the Employee in relation to the
relocation of his principal residence.
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In the event the Employee transfers his principal residence to
the Quebec City area within the above-mentioned twenty-four
month period, the Corporation shall pay to the Employee in a
lump sum, within thirty (30) days of such transfer, the
balance of the $20,000 relocation assistance amount.
If the Employee has received a lump sum payment pursuant to
his relocation to the Quebec City area and then subsequently
voluntarily terminates his employment with the Corporation
within twenty-four (24) months of the commencement of his
employment, the Employee shall reimburse to the Corporation a
portion of the $20,000 relocation assistance amount that is
proportionate to the time remaining in the above-mentioned
twenty-four (24) month period.
(v) The first review of remuneration shall occur on September 1,
2001 and on or about every September 1 thereafter.
2. VACATION
Four (4) weeks of paid vacation annually.
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SCHEDULE B
TO
MARIO LAROSE EMPLOYMENT AGREEMENT
BENEFITS
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The description below is a summary of the Corporation's present benefit package.
It is expected that this package will evolve in the future.
1. The Corporation offers to management a long-term disability plan that
covers two-thirds of salary for life. The Corporation pays the premium,
thus this income would be taxable.
2. Management is covered by collective insurance that is paid by the
Corporation in the following proportions: 40%, 60%, 80% and 100% in
years 1, 2, 3 and 4 respectively. This insurance covers vision
correction, chiropractor, etc. but excludes dental coverage. It also
includes life insurance.
3. As concerns the deferred profit-sharing plan, the Corporation
automatically contributes 1% of the Employee's salary if the Employee
has contributed 2% of his salary. In addition, a variable portion tied
to the Corporation's performance is also contributed. In 1998-1999, the
variable portion was equivalent to 1.45% of salary for a total
contribution by the Corporation of 2.45%.
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