THIS AGREEMENT
is made April 9, 2007 (the “Effective
Date”)
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NATIONAL
MONEY MART COMPANY
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(the
“Company”)
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SYDNEY
FRANCHUK
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(the
“Executive”)
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A. The
Company has employed the Executive as its President to
December 31, 2006 and Dollar Financial Corp.
(“DFC”) has employed the Executive as its Senior
Vice-President up to the Effective Date (the “Prior
Employment”);
B. The
Company and the Executive have agreed that it is to their mutual
benefit and of material value to both of them to enter into this
new limited-term contract of employment (the
“Agreement”) which will define the Executive’s
responsibilities, rights and entitlements for the term thereof;
and
C. The
Executive has agreed to provide a full and final release of all
claims or potential claims arising from or out of the Prior
Employment, in the form hereto attached as Schedule
“A”;
NOW
THEREFORE in
consideration of the promises and mutual covenants herein, and
other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged by both parties, the parties hereby
covenant and agree with each other as follows:
1.1 The term of
this Agreement is from the Effective Date to June 30, 2009
(the “Employment Term”), unless terminated prior to the
end of the Employment Term in accordance with the provisions of
this Agreement.
1.2 This
Agreement shall automatically be renewed for a single one
(1) year term from the end of the Employment Term unless
either party hereto gives notice in writing to the other not less
than ninety (90) days before the end of the Employment Term of
that party’s intention that the Agreement not be
renewed.
2.1
Position . The Executive shall, during the Employment
Term, serve as Chairman of the Company. In addition, the Executive
shall serve as Executive Vice-President of DFC, without
compensation or benefits except as expressly set forth in this
Agreement. In those capacities, the Executive shall be chiefly
responsible for directing and coordinating the Company’s
ongoing activities with respect to regulatory issues in Canada
impacting on the Company’s business and will also assist with
legal issues in Canada impacting on the company’s business,
and shall also have such other duties and responsibilities as are
related thereto or reasonably assigned or requested by the Company
from time to time.
2.2
Reporting. The Executive shall report to the Chairman
of DFC.
3.1 Base
Salary . The Company agrees to pay the Executive and the
Executive agrees to accept as remuneration for services hereunder a
salary of $400,000 per annum on the Effective Date. The sum of
$400,000 per annum together with any increases in salary that are
made by the Company during the term of this agreement and renewals
thereafter shall be defined as the “Base Salary” for
the purposes of this agreement.
3.2
Benefits . The Executive shall be entitled to
participate in all benefit programs offered by the Company to its
senior management, including, without limiting the generality of
the foregoing, group life and disability insurance and medical and
dental plans, in accordance with and on the terms and conditions
generally provided from time to time by the Company. The Executive
agrees that the Company may substitute or modify the benefits on
comparable terms and conditions without notice. For greater
clarity, it is intended the benefits received by the Executive are
commensurate with those received under the Prior
Agreement.
3.3 Bonus
and Incentive Plans . The Executive shall be entitled to
the following:
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(a)
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a
one-time cash bonus of $125,000 (the “Bonus Amount”)
payable upon the Effective Date;
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(b)
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participation in the Company’s
incentive programs for Section 16 officers, including, without
limiting the generality of the foregoing, share option plans, share
purchase plans and bonus plans (collectively, the “Incentive
Plans”), in each case in accordance with and on the terms and
conditions of such Incentive Plans as at the date hereof are in
place or as which may from time to time be amended or implemented
by the Company or DFC in their sole discretion; provided, however,
that for purposes of participation in the Dollar Financial Corp Key
Management Bonus Program for the fiscal year ending June 30,
2007, the concepts outlined in Schedule “B” attached
hereto shall apply; and
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(c)
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a
one-time grant, on the Effective Date, of 10,000 restricted common
shares of DFC (the “Restricted Shares”) pursuant to the
Stock Award Agreement in substantially the form attached hereto as
Schedule “C”.
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3.4
Vacation . The Executive shall be allowed four
(4) weeks of paid vacation for each calendar year, pro-rated
for any portion thereof.
3.5
Expenses . The Executive shall be reimbursed by the
Company for all out-of-pocket expenses actually, necessarily and
properly incurred by the Executive in the discharge of his duties
for the Company. The Executive agrees that such reimbursements
shall be due only after the Executive has rendered an itemized
expense account, together with receipts where applicable, showing
all monies actually expended on behalf of the Company and such
other information as may be required and requested by the
Company.
4.
ADDITIONAL OBLIGATIONS OF THE EXECUTIVE
4.1 Full
Time . The Executive will, for the Term of this Agreement,
devote his full time, attention and ability to the business and
affairs of the Company to fulfill the duties provided for
herein.
4.2
Duties to DFC. The Executive agrees that his duties
and obligations owed to the Company under this Agreement, including
but not limited to the covenants set out in sections 4.3 through
4.11 inclusive, below, are owed by the Executive equally to DFC,
and DFC shall be deemed to be included in the definition of
“Company” where applicable for such purpose.
4.3
Non-Competition. In consideration of the compensation
and other benefits to be paid to Executive pursuant to this
Agreement, Executive agrees that he will not, without prior written
consent of the Company, for a period of twenty-four
(24) months following the cessation of employment pursuant to
this Agreement
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(a)
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directly or indirectly engage in the
United States, Canada, the United Kingdom, or any other country in
which the Company now or hereafter during Executive’s period
of employment, conducts business, in any activity which, or any
activity for any enterprise or entity a material part of the
business of which, is competitive with the business conducted by
the Company at the time of termination or any business that Company
proposed to be conducted during Executive’s employment with
the Company, either as an officer, director, Executive, independent
contractor or as a 2% or greater owner, partner, or stockholder in
a publicly traded entity; or
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(b)
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directly or indirectly cause or
request a curtailment or cancellation of any significant business
relationship that the Company has with a current or prospective
vendor, business partner, supplier or other service or goods
provider that would have a material adverse impact on the business
of Company .
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4.4 Non
Solicitation. During Executive’s employment with the
Company and for twenty-four (24) months after termination of
his employment for any reason, the Executive will not, directly or
indirectly, on his/her own behalf or on behalf of any third
party
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(a)
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recruit, solicit or induce, or
attempt to induce, any employees of the Company or of DFC or any of
its subsidiaries to terminate their employment with, or otherwise
cease their relationship with, the Company or DFC; or
(ii) solicit, divert, reduce, take away, or attempt to divert,
reduce or take away, the business or patronage (with respect to
products or services of the kind or type developed, produced,
marketed, furnished or sold by the Company or of DFC or any of its
subsidiaries with which Executive was substantively involved during
the course of his employment with the Company) of any of the
Company’s or DFC’s (A) clients, customers,
franchisees, or accounts, or (B) prospective
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clients,
customers, franchisees or accounts, that were contacted or
solicited by the Executive within six (6) months prior to the
date his employment with the Company terminated.
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(b)
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Executive acknowledges and
understands that, in the event of a breach or threatened breach of
this provision by Executive, the Company and/or DFC may suffer
irreparable harm and will therefore be entitled to injunctive
relief to enforce this provision, which shall be in addition to any
other remedies available to it, and shall also be entitled to
recovery of its legal fees and costs incurred in seeking to enforce
this provision.
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4.5
Provisions to Survive. If a court of law should
decide that either of sections 4.3 or 4.4 is unreasonable in view
of the particular circumstances, the prohibition set out therein
shall apply with respect to the territory which that Court
determines is appropriate for a duration which the Court determines
is appropriate.
4.6
Confidential Information. The Executive agrees that
all information, whether or not in writing, relating to the
business, technical or financial affairs of the Company and that is
generally understood in the industry as being confidential and/or
proprietary, is the exclusive property of the Company. The
Executive agrees to hold in a fiduciary capacity for the sole
benefit of the Company all such secret, confidential or proprietary
information, knowledge, data, or trade secrets (“Confidential
Information”) relating to the Company or any of their
affiliates or their respective clients, obtained during the course
of his employment with the Company either under this Agreement or
under the Prior Agreement. The Executive agrees that he will not at
any time, either during the term of this Agreement or after its
termination, disclose to anyone any Confidential Information, or
utilize such Confidential Information for his own benefit, or for
the benefit of third parties without written approval by an officer
of DFC. Executive further agrees that all intellectual property,
business processes, proprietary forms, business plans, customer
lists, memoranda, notes, records, data, schematics, sketches,
computer programs, prototypes, proprietary franchise circulars or
similar materials, or written, photographic, magnetic or other
documents or tangible objects compiled by Executive or made
available to Executive during the Term of his/her employment
concerning the business of the Company, DFC and/or their clients,
including any copies of such materials, shall be the property of
the Company and DFC and shall be delivered to the Company on the
termination of his/her employment, or at any other time upon
request of the Company.
4.7
Company Property. All correspondence, records,
documents, software, promotional materials, and other Company
property, including all copies, which come into the
Executive’s possession by, through or in the course of his
employment (including his employment pursuant to the Prior
Agreement), regardless of the source and whether or not created by
the Executive, are the sole and exclusive property of the Company,
and immediately upon the termination of the Executive’s
employment, or at any time the Company shall request, the Executive
shall return to the Company all such property of the Company,
without retaining any copies, summaries or excerpts of any kind or
in any format whatsoever. Executive further agrees that should he
discover any Company property, including but not limited to
Confidential Information as defined in section 4.6 above, in his
possession after the return of such property has been requested,
Executive agrees to return it promptly to Company without retaining
copies, summaries or excerpts of any kind or in any format
whatsoever.
4.8
Court-Ordered Disclosure. In the event that, at any
time during the Term or at any time thereafter, Executive receives
a request to disclose any Confidential Information (as defined in
section 4.6 above) or any other materials of information of the
Company under the terms of a writ, subpoena, order or other
discovery process, made or issued by a court or by a governmental
body, Executive agrees to notify the Company immediately of the
existence, terms, and circumstances surrounding such request, to
consult with the Company on the advisability of taking legally
available steps to resist or narrow such request;
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and, if
disclosure of Confidential Information is required to prevent
Executive from being held in contempt or subject to other penalty,
to furnish only such portion thereof as, in the written opinion of
counsel satisfactory to the Company, Executive is legally compelled
to disclose, and to exercise Executive’s best efforts to
obtain an order or other reliable assurance that confidential
treatment will be accorded to the disclosed trade secrets and other
proprietary and confidential information.
4.9
Business Opportunities . The Executive agrees to
communicate at once to the Company and DFC all business
opportunities which come to the Executive in his capacity as such
or otherwise in the course of the Company’s business and to
deliver to and assign ownership of to the Company all inventions
and improvements in the nature of the business of the Company
which, in the course of the Company’s business the Executive
may conceive, make or discover, become aware directly or indirectly
or have presented to the Executive and such business opportunities,
inventions, and improvements shall become the exclusive property of
the Company without any obligation on the part of the Company to
make any payment for the same.
4.10
Corporate Opportunities . If the Executive receives
notice of or otherwise obtains information regarding potential
acquisitions and other corporate opportunities within the
Employer’s then current and prospective lines of business,
the Executive agrees to offer such acquisitions and other corporate
opportunities first to the Employer and secondly to DFC. If the
opportunities are not pursued by the Employer or DFC within a
reasonable period, then the Executive is shall be free to exploit
such acquisitions and other corporate opportunities, subject to the
provisions of paragraph 4 herein.
4.11
Intellectual Property.
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(a)
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Disclosure of Inventions.
Executive will promptly
disclose in confidence to the Company all inventions, improvements,
processes, products, designs, original works of authorship,
formulas, processes, compositions of matter, computer software
programs, Internet products and services, e-commerce products and
services, e-entertainment products and services, databases, mask
works, trade secrets, product improvements, product ideas, new
products, discoveries, methods, software, uniform resource locators
or proposed uniform resource locators (“URLs”), domain
names or proposed domain names, any trade names, trademarks or
slogans, which may or may not be subject to or able to be patented,
copyrighted, registered, or otherwise protected by law (the
“Inventions”) that Executive makes, conceives or first
reduces to practice or create, either alone or jointly with others,
during the period of his employment, whether or not in the course
of his employment, and whether or not such Inventions are
patentable, copyrightable or able to be protected as trade secrets,
or otherwise able to be registered or protected by law.
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(b)
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Work for Hire; Assignment of
Inventions. Executive acknowledges and agrees
that any copyrightable works prepared by him within the scope of
his employment are “works for hire” under the Copyright
Act and that the Company will be considered the author and owner of
such copyrightable works. Executive agrees that all Inventions that
(i) are developed using equipment, supplies, facilities or
trade secrets of the Company, (ii) result from work performed
by him for the Company, or (iii) relate to the Company’s
business or current or anticipated research and development, will
be the sole and exclusive property of the Company and are hereby
irrevocably assigned by Executive to the Company from the moment of
their creation and fixation in tangible media.
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(c)
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Assignment of Other
Rights. In
addition to the foregoing assignment of Inventions to the Company,
Executive hereby irrevocably transfers and assigns to the Company:
(i) all worldwide patents, patent applications, copyrights,
mask works, trade secrets and other
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intellectual
property rights in any Invention; and (ii) any and all
“Moral Rights” (as defined below) that Executive may
have in or with respect to any Invention. Executive also hereby
forever waives and agrees never to assert any and all Moral Rights
Executive may have in or with respect to any Invention, even after
termination of his work on behalf of the Company. “Moral
Rights” mean any rights to claim authorship of an Invention,
to object to or prevent the modification of any Invention, or to
withdraw from circulation or control the publication or
distribution of any Invention, and any similar right, existing
under judicial or statutory law of any country in the world, or
under any treaty, regardless of whether or not such right is
denominated or generally referred to as a “moral
right.”
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(d)
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Assistance. Executive agrees to assist the
Company in every proper way to obtain for the Company and enforce
patents, copyrights, mask work rights, trade secret rights and
other legal protections for the Company’s Inventions in any
and all countries. Executive will execute any documents that the
Company may reasonably request for use in obtaining or enforcing
such patents, copyrights, mask work rights, trade secrets and other
legal protections. His obligations under this section will continue
beyond the termination of his employment with the Company, provided
that the Company will compensate him at a reasonable rate after
such termination for time or expenses actually spent by him at the
Company’s request on such assistance. Executive appoints the
Secretary of the Company as his power of attorney to execute
documents on his behalf for this purpose, and agrees to take any
further steps required at law to effect such
appointment.
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4.12
Other Duties Not Affected. Nothing in the above
sections shall operate to reduce the obligations that survive the
termination of this Agreement by reason of the Executive’s
common law duties of loyalty and good faith or fiduciary duties to
the Company.
4.13
Injunctive Relief . The Executive acknowledges that a
breach or threatened breach by him of this Agreement could cause
irreparable harm to the Company. Company is therefore entitled to
seek and obtain, without notice to the Executive, injunctive relief
including such mandatory orders as may be required to enforce this
Agreement. This provision is not a waiver by the Company of any
other rights or remedies available to it, including money damages
and recovery of legal costs.
4.14
Non-related Boards . The Executive may sit on
independent non-competitive Boards subject to the provisions of
paragraph 4 herein, but he must obtain consent of the Employer in
advance of accepting such an appointment, such consent not to be
unreasonably withheld.
5.1
Resignation . Notwithstanding the provisions of
section 1 of this Agreement, the Executive may terminate the
employment relationship at any time for any reason by giving the
Company written notice at least thirty (30) days prior to the
effective date of resignation. The Company, at its election, may
require Executive to continue to perform his duties hereunder for
the full thirty (30) day notice period or any portion thereof.
In either event, unless otherwise provided by this section, all
compensation and benefits paid by the Company to the Executive
shall cease upon the effective date of resignation.
5.2
“For Cause” Resignation. The Executive
shall have the right to resign for cause in the event of any one of
the following:
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(a)
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a
wilful material breach by the Company of any provision of this
Agreement;
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(b)
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material adverse change in
Executive’s position (including status, offices, titles and
reporting requirements), authority, duties or responsibilities, or
any other action by the Company made without Executive’s
permission (other than a change due to Executive’s Permanent
Disability or due to a need for accommodation) which results
in:
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(i)
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a
diminution in any material respect in Executive’s position,
authority, duties, responsibilities or compensation, which
diminution continues in time over at least thirty (30) days,
such that it constitutes an effective demotion;
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(ii)
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relocation of the Executive’s
regular work address to a location more than thirty (30) miles
from its location at the commencement of the Employment Term
without Executive’s written consent; or
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(c)
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failure on the part of the Company
to include the Executive under any applicable directors’ and
officers’ insurance
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