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Exhibit
10.1
EXECUTION VERSION
EXECUTIVE EMPLOYMENT
AGREEMENT
This Employment Agreement,
dated as of August 27, 2007 (the “ Agreement
”), between Dollarama L.P. and together with any permitted
assignee (collectively referred to as the “ Employer
”) and Stephane Gonthier (the “ Executive
”).
RECITALS
WHEREAS, the Executive is
expected to be an important contributor to the Business (as defined
below) and has and will acquire knowledge of highly confidential
information pertaining to the Business and the affairs of the
Employer;
WHEREAS, the Executive has
experience and expertise that qualify him to provide the direction
and leadership required by the Employer and its Affiliates (as
defined below);
WHEREAS the parties agree
that the Employer, its Affiliates and their successors and assigns
require protection of their legitimate business
interests;
WHEREAS, subject to the terms
and conditions hereinafter set forth, the Employer therefore wishes
to confirm the terms and conditions of employment of the Chief
Operating Officer and the Executive wishes to accept such
employment; and
WHEREAS Dollarama Capital
Corporation (“ DCC ”) and the Executive have
entered into an Option Agreement as well as a Subscription
Agreement pursuant to which the Executive has, inter alia,
signed a counterpart to the Amended and Restated Securityholders
Agreement of DCC, all of which also constitute essential
considerations for the Executive’s acceptance of the
Employer’s offer of employment and for his entering into the
present Agreement.
AGREEMENT
NOW, THEREFORE, in
consideration of the foregoing premises and the mutual promises,
terms, provisions and conditions set forth in this Agreement, the
parties hereby agree:
1. Employment .
Subject to the terms and conditions set forth in this Agreement,
the Employer hereby offers and the Executive hereby accepts
employment.
2. Term . Subject to
Section 5, this Agreement shall have an original term of five
years commencing on September 2, 2007 (the “ Start
Date ”) and shall be automatically renewed thereafter for
successive terms of one year each, unless either party provides
notice to the other at least three months prior to the expiration
of the original or any successive term that the Agreement is not to
be renewed. In the event that notice is given to the effect that
this Agreement is not renewed, this Agreement and Executive’s
employment shall automatically terminate upon the expiry of such
term. The term of this Agreement, as from time to time extended or
renewed, is hereafter referred to as the “ Term
”.
3. Capacity and
Performance .
(a) During the Term, the
Executive shall serve the Employer as its Chief Operating Officer
with such customary responsibilities, duties and authority as may
from time to time be assigned to him by the Chief Executive Officer
of the Employer (the “ Chief Executive Officer
”) and the Board of Directors of the Employer (the “
Board ”). In addition and without further
compensation, the Executive shall serve as a director and/or
officer of one or more of the Employer’s operating
subsidiaries if so elected or appointed from time to time, provided
that the Employer shall provide to the Executive at all times, and
pay all of the costs of, directors’ and officers’
liability insurance coverage with respect to such service as
required by Section 4 hereof.
(b) During the Term, the
Executive shall be employed by the Employer on a full-time basis
and shall be responsible for store operations, supply and logistics
and human resources as well as perform such duties and
responsibilities on behalf of the Employer and its Affiliates as
may be designated from time to time by the Chief Executive Officer
and the Board. The duties to be performed by the Executive
hereunder shall be performed primarily at the principal office of
the Employer in the City of Montreal, Quebec, subject to reasonable
travel requirements.
(c) During the Term, the
Executive shall devote his full business time and his best efforts,
business judgment, skill and knowledge exclusively to the
advancement of the Business and interests of the Employer and its
Affiliates and to the discharge of his duties and responsibilities
hereunder. The Executive shall not engage in any other business
activity or serve in any industry, trade, professional,
governmental or academic position during the Term, except as may be
approved by the Chief Executive Officer and the Board. The
foregoing provisions of this Section 3(c) shall not, however,
preclude the Executive from devoting a reasonable amount of time to
engaging in civic, charitable or religious activities, devoting a
reasonable amount of time to private investment activities, and/or
serving as a director, officer or trustee of family-owned
companies, trusts or foundations, as well as acting as a director
of a maximum of three (3) Boards of Directors, as identified
in Appendix A and amended, as the case may be, by the Executive in
accordance with this Agreement, provided in each case that such
involvement is in compliance with the provisions of
Section 8(a) hereof and does not otherwise conflict with the
Executive’s responsibilities to the Employer.
4. Compensation and
Benefits . In addition to the Option Agreement and the
Subscription Agreement mentioned in the Recitals, as compensation
for all services performed by the Executive under and during the
Term and subject to performance of the Executive’s duties and
of the obligations of the Executive to the Employer and its
Affiliates, pursuant to this Agreement or otherwise:
(a) Base Salary .
During the Term, the Employer shall pay the Executive a base salary
at the rate of $310,000 per annum, less all applicable
withholdings, payable in accordance with the payroll practices of
the Employer for its executives (the “ Base Salary
”) and the Executive shall be entitled to an annual merit
increase to the extent that other members of senior management are
entitled to such annual merit increase, it being understood that
the annual increase may vary from an executive to
another.
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(b) Annual Bonus .
During the Term, with respect to each of the Employer’s
fiscal years that begins on or after February 1, 2007, the
Executive will be eligible to receive a bonus (the “
Annual Bonus ”) with a target of 75% of his Base
Salary (“ Target Annual Bonus ”), except that,
such Annual Bonus shall be pro rated for the fiscal year beginning
on February 1, 2007 based on the number of days between the
Start Date of this Agreement and the end of such fiscal year as
compared to the total number of days in such fiscal year. The
Annual Bonus will be based on the achievement of targets which
shall be determined by the Board.
Notwithstanding the above,
the Executive’s Target Annual Bonus for the fiscal year
beginning on February 1, 2007 and his Target Annual Bonus for
the fiscal year beginning on February 1, 2008, shall not be
less than that of any other officer of the Employer, with the
exception of the CEO.
For greater certainty, no
notice, pay in lieu of notice, statutory notice, severance pay or
any other payment whatsoever that is given or that ought to have
been given under this Agreement or any applicable law in respect of
the Executive’s termination of employment will be utilized in
determining entitlement to payment of the Annual Bonus.
(c) Other Benefits .
During the Term and subject to any contribution therefor generally
required of executives of the Employer, the Executive shall be
entitled to participate in any and all employee benefit plans from
time to time in effect for executives of the Employer generally
consistent with company practices and as outlined in the Benefits
Booklet attached hereto as Appendix B. Such participation shall be
subject to the terms of the applicable plan documents and generally
applicable Employer policies. The Employer may alter, modify, add
to or delete its employee benefit plans at any time as it, in its
sole judgment, determines to be appropriate and the whole subject
to applicable law. The Executive shall be entitled to four
weeks’ paid vacation and reasonable holidays and illness days
in accordance with the Employer’s policies as may be
established and modified from time to time.
(d) Short-term
Disability . Subject to Section 5(b), in the event the
Executive becomes disabled during the Term through any illness,
injury, accident or condition of either a physical or psychological
nature, and, as a result, is unable to perform all his duties and
responsibilities hereunder, the Employer will pay to the Executive
the equivalent of the Executive’s Base Salary for the lesser
of:
(i) a period of one hundred
and eighty consecutive days; or
(ii) until terminated in
accordance with Section 5(b)(i) of this Agreement, provided
that in the event where the Employer or its Affiliates then have in
effect a Long Term Disability Plan, the Executive shall be paid his
Base Salary until he is eligible to be paid long term disability
benefits under the Company’s plan.
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(e) Directors’ and
Officers’ Insurance . The Employer shall provide to the
Executive the benefit of at all times during the Term, and pay all
of the costs of, the directors’ and officers’ liability
insurance policy or policies obtained by the Employer, which shall
cover the Executive for his service hereunder, whether as director,
and/or officer of the Employer or as director and/or officer of any
of the Employer’s Affiliates.
(f) Business Expenses
. The Employer shall pay or reimburse the Executive for all
reasonable, customary and necessary business expenses incurred or
paid by the Executive in the performance of his duties and
responsibilities hereunder in accordance with the Employer’s
expense reimbursement policy.
5. Termination of
Employment and Severance Benefits . Notwithstanding the
provisions of Section 2 hereof, the Executive’s
employment hereunder shall terminate under the following
circumstances:
(a) Death . In the
event of the Executive’s death during the Term, the
Executive’s employment hereunder shall immediately and
automatically terminate. In such event, the Employer shall pay to
the Executive’s designated beneficiary or, if no beneficiary
has been designated by the Executive, to his estate, (i) the
Base Salary earned but not paid through the date of termination,
and (ii) any business expenses incurred by the Executive but
not reimbursed on the date of termination, and (iii) any bonus
compensation (other than Annual Bonus with respect to the fiscal
year in which the date of termination occurs) awarded but unpaid on
the date of termination (collectively, “ Final
Compensation ”); and (iv) the portion of the Annual
Bonus earned for the fiscal year in which the date of termination
occurs, prorated for the time of the Executive’s employment
during the relevant fiscal year (the “ Prorated Bonus
”), it being understood that the Prorated Bonus will be paid
following the end of the relevant fiscal year or such other time as
per the Employer’s normal practice.
(b)
Disability
(i) The Employer may
terminate the Executive’s employment hereunder, upon written
notice to the Executive, in the event that the Executive becomes
disabled during his employment hereunder through any illness,
injury, accident or condition of either a physical or psychological
nature and, as a result, is unable to perform substantially all of
his duties and responsibilities hereunder, with or without
reasonable accommodation, for ninety (90) days during any
period of one hundred eighty (180) consecutive calendar days.
In the event of such termination, (a) if the Employer or its
Affiliates then have in effect a Long Term Disability Plan, the
Employer shall have no further obligation to the Executive, other
than for payment of Final Compensation and any Prorated Bonus and
(b) if neither the Employer nor its Affiliates have in effect
a Long Term Disability Plan, the Employer shall have no further
obligation to the Executive, other than for payment of amounts
described in Section 5(d).
(ii) The Board may designate
another employee to act in the Executive’s place during any
period of the Executive’s disability. While receiving
disability income payments under Employer’s disability income
plan, the Executive shall continue to participate in Employer
benefit plans, if any, in accordance with the terms of such plans,
until the termination of his employment.
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(c) By the Employer for
Cause . The Employer may terminate the Executive’s
employment hereunder immediately for Cause at any time upon written
notice to the Executive setting forth in reasonable detail the
nature of such Cause.
Upon the giving of notice of
termination of the Executive’s employment hereunder for
Cause, the Employer shall have no further obligation to the
Executive, other than for Final Compensation and any requirement of
applicable law.
(d) By the Employer Other
than for Cause . The Employer may terminate the
Executive’s employment at any time, other than for Cause,
Death and Disability by (a) paying to the Executive Final
Compensation and any Prorated Bonus; and (b) provided the
Executive continues to fulfill the remainder of his contractual
obligations towards the Employer, by providing the Executive
with severance pay in lieu of notice representing the
Executive’s Base Salary for twenty-four months, payable by
way of salary continuance in accordance with the Employer’s
payroll practices at the date of termination or in a lump sum
payment, at the sole discretion of the Employer.
Any obligation of the
Employer to the Executive hereunder is conditional, however, upon
the Executive signing a release, reasonably acceptable to the
Employer, of any and all claims related to the employment of the
Executive or the termination thereof.
(e) By the Executive for
Constructive Termination . The Executive may terminate his
employment hereunder immediately for Constructive Termination at
any time upon written notice to the Employer setting forth in
reasonable detail the nature of the Constructive Termination. In
the event of such termination, the Employer shall (i) pay the
Executive’s Final Compensation and any Prorated Bonus, and
(ii) conditional upon the Executive continuing to fulfill his
contractual obligations toward the Employer, by way of salary
continuance, in accordance with the Employer’s payroll
practices at the time of Constructive Termination, the
Executive’s Base Salary for twenty-four months following
termination or an amount representing twenty-four months of the
Executive’s Base Salary, in a lump sum payment, at the sole
discretion of the Employer.
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