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EMPLOYMENT AGREEMENT

Employment Agreement

EMPLOYMENT AGREEMENT | Document Parties: DIALOGIC INC. | Dialogic Corporation You are currently viewing:
This Employment Agreement involves

DIALOGIC INC. | Dialogic Corporation

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Title: EMPLOYMENT AGREEMENT
Date: 2/28/2011
Industry: Computer Networks     Sector: Technology

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Exhibit 10.1

 

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (this “ Agreement ”), is entered into as of November 02, 2009 (“ Effective Date ”) by and between Dialogic Corporation (“Dialogic”) and Jean Gagnon (“Executive”).

WHEREAS Executive has been employed by Dialogic since June 26, 2001 (“ Start Date ”) under the terms of an offer letter as has been amended from time to time (“ Original Employment Agreement ”) and currently occupies the position of Executive Vice President and Chief Financial Officer.

WHEREAS Dialogic and Executive wish to more fully set out the terms of Executive’s employment with Dialogic and therefore desire to replace the Original Employment Agreement with this Agreement as of the Effective Date.

WHEREAS, notwithstanding the foregoing, Dialogic acknowledges that, for all purposes related to Executive’s employment, including but not limited to Executive’s rights under this Agreement, rights under law and rights under Dialogic policies, it shall recognize Executive’s full term of employment, commencing on the Start Date.

NOW, THEREFORE, in consideration of the premises and mutual covenants set forth herein, and other consideration, the receipt of which is hereby acknowledged, Dialogic and Executive hereby agree as follows:

1. Preamble . The preamble of this Agreement forms an integral part of this Agreement as if it was recited at length herein.

2. Employment . Dialogic agrees to continue to employ Executive and Executive hereby accepts such continued employment with Dialogic to serve as Executive Vice President and Chief Financial Officer for Dialogic and its direct and indirect subsidiaries (“ Dialogic Group ”), upon the revised terms and conditions as set forth in this Agreement for the period beginning on the Effective Date and continuing until the termination of Executive’s employment with Dialogic, as permitted under Section 6 of this Agreement (the “ Employment Period ”).

3. Position and Duties .

 

 

(a)

During the Employment Period, Executive shall serve as the Executive Vice President and Chief Financial Officer of the Dialogic Group and shall have the normal duties, responsibilities and authority of an individual holding such position, subject to the power of the Board of Directors of Dialogic, or its successor company, if applicable, (in either case, the “ Board ”) to reasonably expand or limit such duties, responsibilities and authority within the confines of the customary duties, responsibilities and authority commensurate with Executive’s position.

 

 

(b)

Executive shall report to the President and Chief Executive Officer of Dialogic or such other individual as the Board may designate, and Executive shall devote his best efforts and his full business time and attention (except for permitted vacation periods and reasonable periods of illness or other incapacity) to the business and affairs of the business of Dialogic and the business and affairs of all the Dialogic Group. Executive shall perform his duties and responsibilities to the best of his abilities in a diligent, trustworthy, businesslike and efficient manner.

 

 

 

    

Dialogic Corporation 9800 Cavendish Blvd 5 th Floor Montreal Quebec Canada H4M 2V9

www.dialogic.com

    

Tel: 514 745-5500 Fax: 514 745-5588

  

Page 1 of 9 with Appendices


 

 

(c)

Notwithstanding the foregoing, during the Employment Period, it shall not be a violation of this Agreement for Executive to (i) run for and hold public office; (ii) serve on industry trade, civic or charitable boards or committees; (iii) deliver lectures or fulfill speaking engagements; or (iv) manage personal investments, as long as such activities do not negatively impact in a material way the performance of the Executive’s duties and responsibilities to Dialogic. During the Employment Period, the Executive shall be permitted to serve on for-profit corporate boards of directors and advisory committees if approved in advance by the Board, which approval shall not be unreasonably withheld or delayed unless the company concerned is a direct or indirect competitor of Dialogic, in which case the Board may withhold approval at its entire discretion.

 

 

(d)

Dialogic acknowledges that Executive is required by virtue of his position to serve as a director and officer of Dialogic and/or many other companies in the Dialogic Group. Dialogic agrees to maintain directors and officers insurance that will cover Executive in the performance of his functions as a director and officer of Dialogic and any other company in the Dialogic Group. Dialogic and Executive have executed the indemnity agreement, attached hereto as Annex A (“Indemnity Agreement”) and agree that the Indemnity Agreement supercedes any previous indemnity agreements executed by Dialogic and Executive, including the indemnity agreement executed January 1, 2003. This Indemnity Agreement remains in effect during and after the Employment Period.

4. Base Salary, Bonus and Benefits .

 

 

(a)

Base Salary . During the Employment Period, Executive’s base salary shall be as set from time to time by the Board or a Committee of the Board (“ Compensation Committee ”), but under no circumstances will be less than CAD$255,990 per annum (“ Base Salary ”), unless a reduction in pay is mutually agreed to by both Executive and Dialogic. The Base Salary shall be payable in regular installments in accordance with Dialogic’s general payroll practices and shall be subject to customary withholding taxes and standard payroll deductions. Notwithstanding this paragraph 4(a), Executive and Dialogic have entered into a letter agreement dated April 8, 2009, a copy of which is attached to this Agreement as Annex B, providing for temporary salary reductions as part of a company-wide initiative, and which continue in effect until cancelled pursuant to terms of such letter agreement. However, Dialogic and Executive agree that, for the purposes of determining Executive’s entitlements under paragraph 6(c) of this Agreement, such entitlements shall be calculated using the actual Base Salary stipulated in this paragraph 4(a) irrespective of any agreed-to temporary reduction.

 

 

(b)

Car Allowance . Executive will continue to receive an annual car allowance of CAD 7,200, which allowance shall be paid in 24 roughly equal installments of CAD300 each on approximately the 15 th and last day of each calendar month.

 

 

(c)

Bonus. Executive will be eligible for any bonus plan put into place by Dialogic that covers Executive’s position, and will be advised of the terms and conditions of such a bonus plan when and if applicable (“Bonus”). Bonus payments are always subject to the terms of the applicable Dialogic bonus plan.

 

 

(d)

Benefits. During the Employment Period, Executive will be entitled to participate in all of Dialogic’s employee benefit programs for which senior executive employees of Dialogic are generally eligible (collectively, the “ Benefits ”).

 

 

 

    

Dialogic Corporation 9800 Cavendish Blvd 5 th Floor Montreal Quebec Canada H4M 2V9

www.dialogic.com

    

Tel: 514 745-5500 Fax: 514 745-5588

  

Page 2 of 9 with Appendices


 

 

(e)

Paid Time Off . During the Employment Period, Executive will be entitled to paid time off, which paid time off benefits shall accrue and shall otherwise be administered and taken in accordance with Dialogic’s policy for paid time off as in effect from time to time. Such paid time off includes 20 vacation days per year and public holidays recognized by Dialogic in Quebec, Canada, and as published in Dialogic’s company policies, from time to time. Furthermore during the period where the temporary salary reduction referred to in Section 4A is in effect, Executive is entitled to an additional two (2) paid days per month, provided that it is scheduled and taken in accordance with Dialogic’s policy for paid time off as in effect from time to time. Dialogic acknowledges that Executive has exceptionally been permitted to carry over unused vacation days from previous years, such that Executive is currently credited with 21 days of such carried over vacation as of April 30, 2009, which are exceeding the vacation amounts Executive would otherwise be entitled to carry over. (“ Vacation Carry-Over Days ”). It is hereby agreed that Executive will make reasonable efforts to use a minimum of five (5) such Vacation Carry-Over Days per year, provided that it is scheduled and taken in accordance with Dialogic’s policy for paid time off as in effect from time to time.

 

 

(f)

Expenses. Executive acknowledges that the position of Executive Vice President and Chief Financial Officer is one that will require extensive travel in order to perform the specified job responsibilities. Dialogic shall reimburse Executive for all reasonable expenses incurred by him in the course of performing his duties under this Agreement which are consistent with Dialogic’s policies in effect from time to time with respect to travel, entertainment and other business expenses, subject to Executive’s compliance with Dialogic’s requirements with respect to reporting and documentation of such expenses.

 

 

(g)

RRSP Contribution . Executive will continue to receive an RRSP contribution in the amount of a minimum of CAD 5,400 on an annual basis which shall be directly deposited December of each calendar year and no later than January of the following year of each calendar year into the account designated by Executive.

5. Stock Options . Executive was awarded 287,000 options in Dialogic as of January 1, 2004. Those options have fully vested and are exercisable (“ Existing Options ”). The Existing Options give Executive the right to subscribe for an equal number of common shares of the capital of Dialogic (“ Shares ”) under the terms defined in the Dialogic Amended and Restated Stock Option Plan (“ Plan ”) at a price of $0.19 cents CAD per Share. Executive was also awarded 100,000 options on June 22, 2007 (“ Newer Options ”) some of which have vested as of the Effective Date and others which shall continue to vest under the terms of the Plan but which are solely exercisable under the conditions set out in the Plan. The Newer Options give Executive the right to subscribe for an equal number of Shares under the terms defined in the Plan at a price of $1.11 USD per Share. Section 3.6 of the Plan provides for the circumstances under which options will have an earlier termination date than the Expiry Date defined in the Plan unless otherwise determined by the Board. Dialogic agrees that, unless Executive is terminated under this Agreement for Cause in accordance with paragraph 6(a)(i), to seek approval from the Board and to recommend to the Board to waive the early expiration provision in the case of the Existing Options and Newer Options and any future options received by Executive under the Plan and allow such options to remain in full force and effect until the original Expiry Date or until exercised, whichever is the earlier.

 

 

 

    

Dialogic Corporation 9800 Cavendish Blvd 5 th Floor Montreal Quebec Canada H4M 2V9

www.dialogic.com

    

Tel: 514 745-5500 Fax: 514 745-5588

  

Page 3 of 9 with Appendices


 

6. Termination of Employment.

 

 

(a)

Dialogic and Executive agree that Executive’s employment under this Agreement may be terminated in any of the following ways, subject only to the terms of this Section 6:

 

 

(i)

By Dialogic with Cause (as defined below) on simple notice from Dialogic to Executive, the whole without further notice, payment in lieu of notice, severance or any indemnity whatsoever due to Executive;

 

 

(ii)

By Dialogic without Cause upon giving Executive at least sixty (60) days prior notice in writing of such termination (“ Notice Period ”). During the Notice Period, and as a condition of the benefits and payments set out in paragraph 6(c), Executive will continue to diligently and faithfully exercise his duties and responsibilities hereunder, including providing a successful turnover to either his direct manager or to any other person designated by Dialogic. Notwithstanding the foregoing, Dialogic may, at its option and sole discretion, choose to waive the benefit of Executive’s services for all or part of the Notice Period, in which event, Dialogic will, in addition to its obligations under paragraph 6(c), continue to pay Executive his Base Salary hereunder for such remaining part of the Notice Period, up to a maximum of 60 days from the date on which such notice of termination is given. Without prejudice to the foregoing, Executive and Dialogic may mutually agree for Executive to take all or part of his accrued and untaken vacation during the Notice Period;

 

 

(iii)

As a result of Executive’s resignation upon Executive’s providing Dialogic with at least sixty (60) days prior notice in writing of his intention to resign (“ Notice of Resignation Period ”). During the Notice of Resignation Period, Executive will continue to diligently and faithfully exercise his duties and responsibilities hereunder, including providing a successful turnover to either his direct manager or to any other person designated by Dialogic. Notwithstanding the foregoing, Dialogic may, at its option and sole discretion, choose to waive all or part of the Notice of Resignation Period, in which event, Dialogic will, in addition to any obligations it may have under paragraph 6(b), continue to pay Executive his Base Salary hereunder for such remaining part of the Notice of Resignation Period, up to a maximum of 60 days from the date on which such notice of resignation is given. Without prejudice to the foregoing, Executive and Dialogic may mutually agree for Executive to take all or part of his accrued and untaken vacation during the Notice of Resignation Period.

 

 

(iv)

As a result of Executive’s Death or Disability;

 

 

(v)

As a result of Executive’s Constructive Dismissal (as defined below).

 

 

(b)

In the event that Executive’s employment is terminated with Cause under paragraph 6(a)(i) or of Executive’s resignation under paragraph 6(a)(iii), Executive’s employment hereunder will be deemed to have ended as of the date on which notice of termination is given or the last day of the Notice of Resignation Period, as the case may be, and Executive shall be entitled to receive only his Base Salary through to such date, as well as all accrued and untaken vacation including the Vacation Carry- Over Days as per Dialogic’s policy, subject to all applicable withholding and other appropriate deductions.

 

 

 

    

Dialogic Corporation 9800 Cavendish Blvd 5 th Floor Montreal Quebec Canada H4M 2V9

www.dialogic.com

    

Tel: 514 745-5500 Fax: 514 745-5588

  

Page 4 of 9 with Appendices


 

 

(c)

In the event that Executive’s employment is terminated without Cause under paragraph 6(a)(ii), as a result of Executive’s Constructive Dismissal under paragraph 6(a)(v) or as a result of Executive’s Disability under paragraph 6(a)(iv), Executive’s employment hereunder will be deemed to have ended as of (a) the last day of the Notice Period, (b) the date on which Executive gives notice of his intent to resign as a result of an event of Constructive Dismissal, or (c) the date on which Executive is notified of the termination of his employment as a result of Disability, as the case may be (in each case, the “ Termination Date ”), and Executive shall be entitled to receive, in addition to any notice entitlement under paragraph 6(a)(ii), and subject to all applicable withholding and other appropriate deductions:

 

 

(i)

Base Salary through the Termination Date;

 

 

(ii)

Any then accrued and unpaid Bonus for any fiscal year of Dialogic which ended prior to the Termination Date and to which Executive is entitled under the terms of the applicable bonus plan, in which case such Bonus will be paid on the date such Bonus would otherwise have been payab


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