exv10w15



 





IMAX CORPORATION




EXHIBIT 10.15




EMPLOYMENT AGREEMENT




     This Employment Agreement dated and effective as of May 17, 1999 (the “Agreement”), is made
between



IMAX LTD.

a corporation organized

under the laws of Ontario

(hereinafter referred to as the “Company”)




OF THE FIRST PART




And




IMAX CORPORATION

a corporation organized

under the laws of Canada

(Imax Corporation, together with all its subsidiaries and affiliates are hereinafter referred to as
“Imax”)




OF THE SECOND PART




And




ROBERT D. LISTER

of the Town of Scotch Plains in the

State of New Jersey

(hereinafter referred to as the “Executive”)




OF THE THIRD PART




     WHEREAS, the Company wishes to enter into this Agreement to engage the Executive to provide
services to the Company, and the Executive wishes to be so engaged, pursuant to the terms and
conditions hereinafter set forth;



     AND WHEREAS the Executive is engaged to provide services to the Company as its Senior Vice
President, Legal Affairs and General Counsel;



     NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth, the
parties hereto agree as follows:









 



 


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1. EMPLOYMENT AND DUTIES



1.1 Employment. The Company hereby agrees to employ the Executive, and the Executive
hereby agrees to serve, as Senior Vice President, Legal Affairs and General Counsel of the
Company, upon the terms and conditions herein contained. The Executive’s primary responsibilities
shall be to organize and manage the legal affairs generally of the Company and to perform such
other duties commensurate with his position with the Company as are reasonably designated by the
senior operating officer of the Company, which position is currently held by the Co-Chief Executive
Officers of the Company. The Executive shall serve at all times as the Company’s chief legal
officer and all members of the Company’s Legal Department shall report, directly or indirectly, to
the Executive. The Executive agrees to serve the Company faithfully and to the best of his ability
under the direction of the senior operating officer of the Company. The Executive shall report to
the senior operating officer of the Company on substantially all of his activities. During his
employment, the Executive will be appointed as an Officer of Imax Corporation, although he will not
be employed by that entity.



1.2 Exclusive Services. Except as may otherwise be approved in advance by the senior
operating officer of the Company, the Executive shall devote his full working time throughout the
Employment Term (as defined in Section 1.3) to the services required of him hereunder. The
Executive shall render his services exclusively to the Company and its subsidiaries and affiliates
during the Employment Term, and shall use his best efforts, judgment and energy to improve and
advance the business and interests of the Company in a manner consistent with the duties of his
position.



1.3 Term of Employment. The Executive’s employment under this Agreement shall commence on
the date hereof (the “Commencement Date”) and shall terminate on the earlier of (i) the second
anniversary of the Commencement Date, or (ii) termination of the Executive’s employment pursuant
to this Agreement. The period commencing as of the Commencement Date and ending on the second
anniversary of the Commencement Date or such later date to which the term of the Executive’s
employment under this Agreement shall have been extended is hereinafter referred to as the
“Employment Term”.



1.4 Place of Employment. During the Employment Term the Executive will, subject to
work-related travel, principally work at the Company’s offices in New York City and, as requested
or as required by circumstance, at the offices of the Company in Mississauga and Los Angeles. The
Executive shall spend the balance of his working time in such location or locations as are
necessary and appropriate for the performance of the duties of the Executive, subject to the
direction of the senior operating officer of the Company.










 



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1.5 Reimbursement of Expenses. The Company shall reimburse the Executive for reasonable
travel and other business expenses incurred by him in the fulfilment of his duties hereunder in
accordance with Company practices consistently applied.




2. COMPENSATION



2.1 Base Salary. During his employment under this Agreement, the Executive shall be paid a
base salary (“Base Salary”) of no less than US$200,000 subject to annual review. The Executive
shall be paid no less frequently than monthly in accordance with the Company’s payroll practices.



2.2 Bonus. In addition to the Base Salary, during the Employment Term the Executive shall
be entitled to participate in the management bonus plan of the Company which applies to senior
executives of the Company. The Executive shall participate in that plan on the basis that the
target annual bonus pool eligibility of the Executive shall be 30% of his Base Salary in any year,
which will entitle the Executive to earn a bonus, according to the terms of the bonus plan, of up
to 45% of his Base Salary. Notwithstanding the foregoing, the bonus to be paid to the Executive in
respect of 1999 shall be not less than US$38,100 (the “Guaranteed Bonus”), which shall be paid at
the time bonuses are scheduled to be paid to other senior managers participating in the plan. The
Executive acknowledges that the said bonus plan may be changed from time to time by the Company
without notice to or any requirement to obtain the consent of the Executive and without the
Executive having any claim against the Company with respect to any changes thereto, including any
claims of Constructive Dismissal. Following any changes to the said plan, the Executive will be
given notice of the changes in the same manner as are other executives of the Company of the
Executive’s stature. Any annual bonus will be prorated for any part calendar year of employment
hereunder.










 



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2.3 Stock Options. Effective as soon as is practicable after the Commencement Date, the
Executive shall be granted non-qualified options (the “Options”) to purchase 25,000 shares of
common stock of Imax Corporation (the “Common Shares”), at an exercise price per Common Share
equal to the Fair Market Value, as defined in Imax Corporation’s Amended Stock Option Plan (the
“Option Plan”). Twenty percent (20%) of the Options shall vest and become exercisable on each of
the first five anniversary dates of the grant date. Effective on the first anniversary of the
Commencement Date, the Executive shall be granted non-qualified options to purchase at least 15,000
Common Shares at an exercise price per Common Share equal to the Fair Market Value on that date and
subject to a five year, 20% per annum vest schedule. The options granted hereunder shall be
subject to the terms and conditions of the Option Plan and the stock option agreements to be
entered into between the Company and the Executive as of the applicable date of grant pursuant to,
and in accordance with, the terms of the Option Plan; provided, however that any of the said
options, together with all other options granted to the Executive under Imax Corporation’s Option
Plan, which are not yet exercisable shall become immediately exercisable in the event of both of
(a) a change in control of the Company i.e. any person, or group of persons acting in concert,
other than Bradley J. Wechsler and Richard L. Gelfond, acquiring greater than fifty percent (50%)
of the outstanding common shares of Imax Corporation, whether by direct or indirect acquisition or
as a result of a merger or reorganization and (b) the occurrence of one or more of the following:
(i) Bradley J. Wechsler and Richard L. Gelfond cease to be Co-Chief Executive Officers of the
Company; (ii) the Executive’s termination from the Company Without Cause; (iii) the diminution of
the Executive’s title and/or responsibilities;or (iv) the Executive being asked to relocate more
than 30 miles from his then current office in New York.




3. EXECUTIVE BENEFITS



3.1 General. The Executive shall, during the Employment Term, receive Executive benefits
including vacation time, medical benefits, disability and life insurance, all at least consistent
with those established by the Company for its other key executives at a level commensurate with
that of the Executive. Without limitation, however, the Executive shall be entitled to the
following benefits:





	 	(i)	 	the greater of: four (4) weeks’ paid vacation, or the amount of paid vacation
to which the Executive is entitled in accordance with the Company’s vacation policy,
throughout the Employment Term;
	 
	 	(ii)	 	such audio/visual, computer, fax, cellular telephone and other like equipment
as may be necessary in connection with the performance of the Executive’s
responsibilities shall be made available to the Executive;
	 
	 	(iii)	 	a monthly automobile allowance of US$850.00, together with all associated
operating expenses and parking garage expenses (which allowance can, in total or a
portion thereof, at Executive’s option, be taken as additional compensation);










 



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	 	(iv)	 	a full time administrative assistant located in the New York offices of the
Company; and
	 
	 	(v)	 	an office at the Company’s Headquarters in Mississauga.





4. TERMINATION OF EMPLOYMENT




          Definitions. As used in this Article 4, the following terms have the following
meanings:



(a) “Termination Payment” means each of the following amounts to the extent that such amounts are
due to be paid to and including the date upon which the Executive’s employment is terminated (i)
Base Salary and automobile allowance, (ii) unreimbursed business expenses as outlined in Section
1.5, (iii) any amounts to be paid pursuant to the terms of any benefit plans of the Company in
which the Executive participates or pursuant to any policies of the Company applicable to the
Executive, including the management bonus plan referred to in Section 2.2, calculated up to and
including such date; and (iv) any outstanding vacation pay calculated up to and including such
date.



(b) “Without Cause” means termination of the Executive’s employment by the Company other than for
Cause (as defined in Section 4.2), death or disability (as set forth in Section 5).



4.1 Termination Without Cause



4.1.1 General. Subject to the provisions of Sections 4.1.2, 4.1.3 and 6, if, prior to the
expiration of the Employment Term, the Executive’s employment is terminated by the Company Without
Cause, the Company shall pay the Termination Payment then due to be paid within 30 days of the date
of termination and shall continue to pay the Executive the Base Salary, automobile allowance and
Executive’s target bonus (the “Target Bonus”) (on a pro-rated basis) pursuant to the terms of the
management bonus plan referred to in Section 2.2, for the remainder of the Employment Term (such
period being referred to hereinafter as the “Severance Period”), either at such intervals as the
same would have been paid had the Executive remained in the active service of the Company including
the applicable portion of the Target Bonus, or, at the option of the Company, by immediate payment
to the Executive of the remaining Base Salary, automobile allowance and Target Bonus which would be
payable during the Severance Period, provided however that the Severance Period shall be a minimum
of six months in duration. Upon such termination, the Executive shall also be entitled to continue
to receive his employment benefits referred to in Section 3.1 at the Company’s expense (to the
extent paid for by the Company as at the date of termination) and subject to the consent of the
applicable insurers.



The Executive agrees that the Company may deduct from any payment of Base Salary to be made during
the Severance Period the benefit plan contributions which are to be made by the








 



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Executive during the Severance Period in accordance with the terms of all benefit plans for the minimum
period prescribed by law. The Executive shall have no further right to receive any other
compensation or benefits after such termination of employment except as are necessary under the
terms of the Executive benefit plans or programs of the Company or as required by applicable law.
Payment of Base Salary, automobile allowance and Target Bonus and the continuation of the
aforementioned Executive benefits during the Severance Period as outlined above shall be deemed to
include all termination and severance pay to which the Executive is entitled pursuant to applicable
statute law and common law. The date of termination of employment Without Cause shall be the date
specified in a written notice of termination to the Executive and does not include the Severance
Period.



4.1.2 Fair and Reasonable The parties confirm that notice and pay in lieu of notice
provisions contained in Subsection 4.1.1 are fair and reasonable and the parties agree that upon
any termination of this Agreement Without Cause, the Executive shall have no action, cause of
action, claim or demand against the Company or Imax or any other person as a consequence of such
termination other than to enforce Section 4.1.1.



4.1.3 Conditions Applicable to the Severance Period. If, during the Severance Period, the
Executive breaches his obligations under Article 7 of this Agreement, the Company may, upon written
notice to the Executive, terminate the Severance Period and cease to make any further payments or
provide further benefits as described in Section 4.1.1.



4.2 Termination for Cause; Resignation. At any time prior to the expiration of the
Employment Term the Executive’s employment may be terminated by the Company immediately upon notice
for Cause. If, prior to the expiration of the Employment Term, the Executive’s employment is
terminated by the Company for Cause, or the Executive resigns from his employment hereunder, the
Executive shall only be paid, within 15 days of the date of such termination or resignation, the
Termination Payment, then due to be paid. The Executive shall have no further right to receive any
other compensation or benefits after such termination or resignation of employment, except as
determined in accordance with the terms of the Executive benefit plans or programs of the Company.
The date of termination for Cause shall be the date specified in a written notice of termination to
the Executive, which notice shall set forth the basis for the termination. The date of resignation
shall be sixty (60) days following the date or receipt of notice of resignation from the Executive
to the Company.










 



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4.3 Cause. Termination for “Cause” shall mean termination of the Executive’s employment
because of:





	 	(i)	 	the cessation of the Executive’s ability to work legally in the United States
or Canada other than for reasons not within the Executive’s reasonable control;
	 
	 	(ii)	 	any act or omission that constitutes a material breach by the Executive of
any of his obligations under this Agreement, which breach has not been remedied within
thirty (30) days after written notice specifying such breach has been given to the
Executive by the Company;
	 
	 	(iii)	 	the continued failure or refusal of the Executive to perform the duties
reasonably required of him as Senior Vice President, Legal Affairs and General
Counsel;
	 
	 	(iv)	 	any material violation by the Executive of any Canadian or United States
federal, provincial, state or local law or regulation applicable to the business of
the Company or Imax, which violation is injurious to the financial condition or
business reputation of the Company or Imax, or the Executive’s conviction of a felony
or commission of an indictable offense for which he is not pardoned, or any
perpetration by the Executive of a common law fraud;
	 
	 	(v)	 	any other action by the Executive which is materially injurious to the
financial condition or business reputation of, or is otherwise materially injurious
to, the Company or Imax, or which results in a violation by the Company or Imax of any
Canadian or United States federal, provincial, state or local law or regulation
applicable to the business of the Company or Imax, which violation is injurious to the
financial condition or business reputation of the Company or Imax.






4.4 General Upon any termination of the Executive’s employment, the
Executive will immediately cease to be an Officer of the Company and Imax Corporation and
will sign appropriate forms of resignation indicating this.









 



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5. DEATH OR DISABILITY




          In the event of termination of employment by reason of death or Permanent Disability (as
hereinafter defined), the Executive (or his estate, as applicable) shall be paid the Termination
Payment then due to be paid within 30 days of the date of such termination of employment. Both the
employment of the Executive and the entitlement of the Executive to be paid amounts under Section
4.1.1, in respect of the Severance Period, shall terminate immediately and without notice upon his
death or upon his Permanent Disability (as hereinafter defined). Any benefits thereafter shall be
determined in accordance with the benefit plans maintained by the Company, and the Company shall
have no further obligation hereunder. For purposes of this Agreement, “Permanent Disability” means
a physical or mental disability or infirmity of the Executive that prevents the normal performance
of substantially all his duties under this Agreement as an Executive of the Company, which
disability or infirmity shall exist for any continuous period of 180 days. The parties agree that
such Permanent Disability cannot be accommodated short of undue hardship.




6. MITIGATION




          Subject to Section 7.1 and 7.2, the Executive shall be required to mitigate the amount of any
payment provided for in Section 4.1.1 (other than the Termination Payment) by seeking other
employment or remunerative activity reasonably comparable to his duties hereunder, and, upon
Executive’s obtaining such other employment or remunerative activityany payment to be made by the
Company under Section 4.1.1 (other than the Termination Payment) will be reduced by a total of
one-half (1/2) of the amount of such payment prior to the Executive’s obtaining new employment or
remunerative activity. The Executive shall be required as a condition of any payment under Section
4.1.1 (other than the Termination Payment) promptly to disclose to the Company any such mitigation
compensation.










 



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7. NON-SOLICITATION, CONFIDENTIALITY, NON-COMPETITION




7.1 Non-solicitation. For so long as the Executive is employed by the Company or receiving
payment hereunder and continuing for two years thereafter, notwithstanding whether the Executive’s
employment is terminated with or without Cause or whether the Executive resigns, the Executive
shall not, without the prior written consent of the Company and Imax, directly or indirectly, for
the Executive’s own benefit or the benefit of any other person, whether as a sole proprietor,
member of a partnership, stockholder or investor (other than a stockholder or investor owning not
more than a 5% interest), officer or director of a corporation, or as a trustee, executive,
associate, consultant, principal or agent of any person, partnership, corporation or other business
organization or entity other than the Company or Imax: (x) solicit or endeavour to entice away from
Imax, any person or entity who is, or, during the then most recent 12-month period, was employed
by, or had served as an agent or consultant of, the Company and/or Imax; or (y) solicit, endeavour
to entice away or gain the custom of, canvass or interfere in the Company’s and/or Imax’s
relationship with any person or entity who is, or was within the then most recent 12-month period,
a supplier, customer or client (or reasonably anticipated to become a supplier, customer or
client) of the Company and/or Imax and with whom the Executive had dealings during his employment
with the Company. The Executive confirms that all restrictions in this Section are reasonable and
valid and waives all defences to the strict enforcement thereof.




7.2 Non-Competition For so long as the Executive is employed by the Company or
receiving payment hereunder and continuing for a period of two years after the date of the
termination of the employment of the Executive with the Company, notwithstanding whether the
Executive’s employment is terminated with or without Cause or whether the Executive resigns, the
Executive shall not, without the prior written consent of the Company and Imax, directly or
indirectly anywhere within Canada, the United States, Europe or Asia, as a sole proprietor, member
of a partnership, stockholder or investor (other than a stockholder or investor owning not more
than a 5% interest), officer or director of a corporation, or as a trustee, Executive, associate,
consultant, principal or agent of any person, partnership, corporation or other business
organization or entity other than Imax, render any service to or in any way be affiliated with a
competitor (or any person or entity that is, at the time the Executive would otherwise commence
rendering services to or become, affiliated with such person or entity, reasonably anticipated to
become a competitor) of Imax (a “Competitor”), which is engaged or reasonably anticipated to become
engaged in designing or supplying large format theatres, designing or distributing projection or
sound systems for large format theatres, designing or supplying motion simulation attractions or
producing or distributing films specifically for large format theatres or motion simulation
attractions. The Executive confirms that all restrictions in this Section are reasonable and
valid and waives all defenses to the strict enforcement thereof.










 



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7.3 Confidentiality. The Executive covenants and agrees with Imax that he will not at
any time during employment hereunder or thereafter, except in performance of his obligations to the
Company hereunder or with the prior written consent of the senior operation officer of the Company,
directly or indirectly, disclose or use any secret or confidential information that he may learn or
has learned by reason of his association with Imax. The term “confidential information’ includes
information not previously disclosed to the public or to the trade by Imax’s management, or
otherwise in the public domain, with respect to Imax’s products, facilities, applications and
methods, trade secrets and other intellectual property, systems, procedures, manuals, confidential
reports, product price lists, customer lists, technical information, financial information,
business plans, prospects or opportunities, but shall exclude any information which (i) is or
becomes available to the public or is generally known in the industry or industries in which Imax
operates other than as a result of disclosure by the Executive in violation of his agreements under
this Section 7.3 or (ii) the Executive is required to disclose under any applicable laws,
regulations or directives of any government agency, tribunal or authority having jurisdiction in
the matter or under subpoena or other process of law. The Executive confirms that all restrictions
in this Section 7.3 are reasonable and valid and waives all defences to the strict enforcement
thereof.



7.4 Exclusive Property. The Executive confirms that all confidential information is
and shall remain the exclusive property of Imax. All business records, papers and documents
regardless of the form of their records kept or made by Executive relating to the business of Imax
shall be and remain the property of Imax, and shall be promptly returned by the Executive to Imax
upon any termination of employment.



7.5 Injunctive Relief. Without intending to limit the remedies available to Imax, the
Executive acknowledges that a material breach of any of the covenants contained in Article 7 will
result in material and irreparable injury to Imax for which there is no adequate remedy at law,
that it will not be possible to measure damages for such injuries precisely and that, in the event
of such a breach or threat thereof, Imax shall be entitled to seek a temporary restraining order
and/or a preliminary, interim or permanent injunction restraining the Executive from engaging in
activities prohibited by Article 7 or such other relief as may be required specifically to enforce
any of the covenants in Article 7. The Executive waives any defences to the strict enforcement by
Imax of the covenants contained in Article 7. If for any reason it is held that the restrictions
under Article 7 are not reasonable or that consideration therefor is inadequate, such restrictions
shall be interpreted or modified to include as much of the duration and scope identified in Article
7 as will render such restrictions valid and enforceable.



7.6 Representation. The Executive represents and warrants that he is not subject to any
non-competition covenant or any other agreement with any party which would in any manner restrict
or limit his ability to render the services required of him hereunder.










 



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8. MISCELLANEOUS



8.1 Notices. All notices or communications hereunder shall be in writing, addressed as
follows:




	 	 	 	 	 
	To the Company:

	 	Imax Ltd.

2525 Speakman Drive
Mississauga, Ontario
L5K 1B1	 	 
	 
	 	 	 	 
	 

	 	Telecopier No: (905) 403-6468

Attention:         Legal Department
	 	 

	 
	 	 	 	 
	To Imax:

	 	Imax Corporation

2525 Speakman Drive

Mississauga, Ontario

L5K 1B1	 	 
	 
	 	 	 	 
	 

	 	Telecopier No: (905) 403-6468


Attention:         Legal Department
	 	 
	 
	 	 	 	 
	To the Executive:
	 	 	 	 
	 
	 	 	 	 
	 

	 	Rob Lister

60 Clydesdale Road

Scotch Plains, NJ

07076	 	 
	 
	 	 	 	 
	 

	 	Telecopier No: (908) 322-9034
	 	 





All such notices shall be conclusively deemed to be received and shall be effective, (i) if sent by
hand delivery, upon receipt or (ii) if sent by registered or certified mail, on the fifth day after
the day on which such notice is mailed.










 



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8.2 Severability. Each provision of this Agreement shall be interpreted in such manner as
to be effective and valid under applicable law, but if any provision of this Agreement is held to
be prohibited by or invalid under applicable law, such provision will be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of such provision or
the remaining provisions of this Agreement. The parties agree that Sections 4, 5, 6 and 7 shall
survive the termination of this Agreement.



8.3 Assignment. This Agreement shall be binding upon and inure to the benefit of the heirs
and representatives of the Executive and the assigns and successors of the Company and Imax, if any
are permitted by law and provided that the Company and Imax and its assignee shall each remain
liable to the Executive in the event of any assignment, but neither this Agreement nor any rights
hereunder shall be assignable or otherwise subject to hypothecation by the Executive. The Executive
expressly agrees that each of Imax and the Company my assigne any of its rights, interest or
obligations hereunder to any affiliate of either of them without the consent of the Executive;
provide, however, that no such assignment shall relieve the assignor of any of its obligations
hereunder.



8.4 Entire Agreement: Amendment. This Agreement represents the entire agreement of the
parties and shall supersede any and all previous contracts, arrangements or understandings between
the Company and the Executive. This Agreement may only be amended at any time by mutual written
agreement of the parties hereto.



8.5 Withholding. The payment of any amount pursuant to this Agreement shall be subject to
any applicable withholding and payroll taxes, and such other deductions as may be required under
applicable law or the Company’s Executive benefit plans, if any.










 



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8.6 Governing Law. This Agreement shall be governed by and construed in accordance with
the laws of the Province of Ontario and the laws of Canada applicable therein without regard to
principles of conflicts of laws.




     IN WITNESS WHEREOF, the Company and the Executive have duly executed and delivered this
Agreement as of the 19th day of April, 1999.



     



	 	 	 	 	 
	 	IMAX LTD:
 	 
	 	By:  	“John M. Davison”
 	 
	 	 	Name:  	John M. Davison 	 
	 	 	Title:  	Chief Financial Officer

 	 
	 
	 	 	 
	 	By:  	                                  “Mary C. Sullivan”
 	 
	 	 	Name:  	Mary C. Sullivan 	 
	 	 	Title:  	Vice President,

Human Resources & Administration 	 
	 
	 	IMAX CORPORATION:

 	 
	 	By:  	“John M. Davison”
 	 
	 	 	Name:  	John M. Davison 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	 	 
	 	By:  	                                       “Mary C. Sullivan”
 	 
	 	 	Name:  	Mary C. Sullivan 	 
	 	 	Title:  	Vice President,

Human Resources & Administration 	 
	 



	 	 	 	 	 	 	 	 	 
	SIGNED, SEALED AND DELIVERED 

in the presence of:

	 	 	 	 	 	EXECUTIVE:
	 	 
	 
	 	 	 	 	 	 	 	 
	“Mary C. Sullivan”

	 	 	 	 	 	“Robert D. Lister”	 	 
	 	 	 	 	 	 	 	 	 
	Witness

	 	 	 	 	 	Robert D. Lister	 	 












 



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ADDENDUM



For purposes of clarity and so as to avoid any confusion (and effective as of the Commencement
Date), the term “termination Without Cause” as used in this Agreement shall mean termination of the
Employee’s employment for any reason or for no reason (including, but not limited to, termination
of the Employee’s employment as a result of the Company’s determination not to renew or extend this
Agreement), excepting solely a termination for Cause (as defined in Section 4.3) or as a result of
the Employee’s death or disability (as set forth in Section 5). Moreover, for additional clarity,
the provisions of Section 2.3 of this Agreement shall apply and be effective if the event specified
in clause (b) of such Section 2.3 occurs at any time, whether or not the Employment Term has
expired, if the Executive’s employment with the Company continues until such event.




Initial:   “RLG”      “RDL”