exv10w7



 





Exhibit 10.7




EMPLOYMENT AGREEMENT




     THIS EMPLOYMENT AGREEMENT is made and entered into as of the Execution Date set forth on the
signature page hereof, by and between ATS Automation Tooling Systems Inc. (the “Company”) and Gary
Seiter, (the “Employee”).



     NOW, THEREFORE, in consideration of Employee’s employment and in consideration of the mutual
covenants and promises contained in this Agreement, the parties agree as follows:



     1. Employment



     The Company hereby employs Employee on a full time basis, commencing effective as of the
Commencement Date of this Agreement set forth on the signature page hereof (“Commencement Date”)
and Employee hereby accepts such employment, upon the terms and conditions of this Agreement.



     2. Term



     This Agreement starts on April 30th, 2006 and shall thereafter continue for an
indefinite term subject to the termination provisions as provided in Section 7 below.



     3. Duties



     The Employee shall undertake and render such services as may from time to time be assigned to
him by the Manager. Employee shall devote his full business time to the Company and to its
affairs. Employee will at all times conduct himself in accordance with the internal management
controls adopted by the Company from time to time and will perform no services, nor enter into any
contracts for commercial purposes outside the Company except by written consent of the Manager.



     4. Compensation



     For services rendered by Employee under this Agreement, the Company agrees to pay Employee and
Employee agrees to accept an annual base salary in the amount set forth on the signature page
hereof (unless otherwise specified in Schedule A – Supplemental Compensation and Benefits
Arrangements hereto), less all amounts required by law to be withheld, deducted or collected,
payable in accordance with the Company’s payroll policies, as such policies may be changed from
time to time. Any bonus provisions set out in Schedule A – Supplemental Compensation and
Benefits Arrangements may be modified by the Company in its discretion from time to time.
Employee shall be entitled to such other compensation as may be set forth on Schedule A –
Supplemental Compensation and Benefits Arrangements.



     5. Benefits



     The Company shall make available to Employee, during the term of employment, employee benefits
(such as vacation and insurance) made generally available by the Company to its employees, provided
that Employee qualifies for such benefits, plus, if applicable, any other
or different benefits set forth on Schedule A – Supplemental Compensation and Benefits
Arrangements.



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     6. Expenses



     The Company shall pay or reimburse Employee for reasonable out-of-pocket expenses required by
the Company in connection with the performance of the services provided under this Agreement, upon
presentation of appropriate documentation and in compliance with the Company’s expense policies in
place from time to time.



     7. Termination of Employment



     Employee’s employment may be terminated as follows, in which event Employee’s compensation and
benefits shall terminate except as otherwise provided below:




     (a) By Company Without Cause




     Company may terminate Employee’s employment at any time, with or without Cause (as
defined below) or advance notice. If Company terminates Employee’s employment when neither
Cause nor permanent disability exists, Company shall be obligated to continue to pay to
Employee Employee’s then-current base monthly salary as provided in Section 4 and provide
the benefits pursuant to Section 5, but not any other compensation or supplemental benefits
provided pursuant to Schedule A – Supplemental Compensation and Benefits
Arrangements, for a period equal to the Notice Period (as hereinafter defined), on
regular payroll days subject to normal payroll deductions, subject, however to the Employee
complying with the provisions of this Agreement during such Notice Period, including without
limitation the provisions of Sections 8 (Confidentiality), 9 (Return Of Confidential
Records), 10 (Assignment Of Inventions), 11 (Non competition), and 12 (Non-Solicitation).
The “Notice Period” provided in this Agreement shall be a period equal to one month for each
full year of service the Employee has with the Company as of the date of termination,
subject to a minimum Notice Period of six months and a maximum Notice Period of twelve
months regardless of age or length of service. The Notice Period provided herein is
intended to be inclusive of all other notice of termination or severance entitlements to
which the Employee may be entitled.




     (b) By Company for Cause




     Company may terminate Employee’s employment for Cause. Following the notice and
opportunity to cure (if cure is not made), or immediately if notice and opportunity to cure
are not required, Company may terminate Employee’s employment for cause by giving written
notice of termination. The notice may take effect immediately or at such later date as
Company may designate, provided that Employee may accelerate the termination date by giving
five business days’ written notice of the acceleration. Upon termination of employment for
Cause, Company shall pay Employee’s base salary and benefits through the effective date of
termination.




     (c) Definition of “Cause”


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     For purposes of this Agreement “Cause” means and is limited to (i) willful and
continued failure by Employee to substantially perform his duties provided herein after a
written demand for substantial performance delivered to Employee by the Company, which
demand identifies with reasonable specificity the manner in which Employee has not
substantially performed his duties, and Employee’s failure to comply with such demand within
a reasonable time; (ii) the engaging by Employee in gross misconduct or gross negligence
materially injurious to the company; (iii) the commission of any act in direct competition
with or materially detrimental to the best interests of the Company; or (iv) Employee’s
conviction of having committed a crime.




     (d) By Employee




     Employee may terminate Employee’s employment at any time by giving 30 days’ advance
written notice of termination, provided that Company may accelerate the termination date by
giving written notice of the acceleration. Upon termination of employment by employee,
Company shall pay Employee’s base salary and benefits through the effective date of
termination.




     (e) Death




     Employee’s employment shall terminate automatically upon Employee’s death.




     (f) Permanent Disability




     Company may terminate Employee’s employment immediately if Employee becomes permanently
disabled. For purposes of this Agreement, Employee will be considered “permanently
disabled” if, for a continuous period of 180 days or more, Employee has been unable to
perform the essential functions of the job (even with reasonable accommodation) because of
one or more mental or physical illnesses and/or disabilities. Upon termination of
employment by employee, Company shall pay Employee’s base salary and benefits through the
effective date of termination.



     8. Confidentiality



     Employee agrees not to knowingly, directly or indirectly, use, or disclose or make available
for use to anyone other than the Company, its affiliates, or their agents, any Confidential
Information (as defined below) known to Employee as a result of his relationship with the Company,
except as required in Employee’s performance of services for the Company or as authorized in
writing by the Company. “Confidential Information” means, but is not limited to, all designs,
software, hardware, firmware, manuals, drawings, trade secrets, calculations, formulas, algorithms,
research, specifications, current or prospective customer lists, supplier lists, costs, marketing
materials, business and financial records, pricing or sales policies, development plans, marketing
strategies, and all other information belonging to the Company, or its affiliates or that the
Company or its affiliates have from its customers or suppliers and do not have the right to
disclose, related to the business or prospective business of the Company or its affiliates.
Confidential Information does not include information that is (i) generally or readily available to
the public; (ii) publicly known or becomes publicly known through no fault of Employee; or (iii)
received from a third party without violation of a nondisclosure obligation.


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     9. Return of Confidential Records



     All forms of information and all physical property made or compiled by Employee prior to or
during the term of employment pursuant to this Agreement containing or relating in any way to
Confidential Information shall be the Company’s exclusive property. All such materials and any
copies thereof shall be held by Employee in trust solely for the benefit of the Company and shall
be delivered to the Company upon expiration of this Agreement or earlier termination of Employee’s
employment with the Company, or at any other time upon the Company’s request.



     10. Assignment of Inventions




     (a) The Company’s Exclusive Property




     All of Employee’s interest, rights, and claim of ownership in any and all Confidential
Information, inventions, discoveries, improvements, suggestions, proposals, and ideas
(collectively, “Inventions,” whether patentable or not) Employee has made or shall make
during the period of Employee’s employment with the Company, whether made solely by Employee
or jointly with others, and whether or not made during working hours, which relate or are
applicable, directly or indirectly, to any phase of the Company’s business on its
relationships with its customers or suppliers, including, but not limited to, the Company’s
actual or anticipated research or development or the actual or anticipated research or
development of the Company’s customers or suppliers to which the Company has access, shall,
as between the Employee and the Company, be the exclusive property of the Company, its
successors, assignees or nominees.




     (b) Disclosure and Assistance




     Employee will disclose Inventions to the Company promptly and in writing. When
requested, and at the Company’s expense, Employee will assist the Company or its designee in
efforts to protect such Inventions, including, without limitation, by taking any of the
following actions: (i) making patent application(s) on any Invention specified by the
Company in such jurisdictions as determined by the Company; (ii) executing documents of
assignment to the Company or its designee of all Employee’s right, title and interest in and
to any Invention, any patent applications relating thereto, and any patents granted thereon;
and (iii) from time to time, at the request of the Company, executing all instruments and
rendering all such assistance as may reasonably be required in order to protect the rights
of the Company or its designee and to vest in the Company or its designee all rights to any
Invention, patent application and patents.




     (c) Company’s Discretion




     Employee understands and agrees that Company or its designee will determine, in its
sole and absolute discretion, whether and to what extent applications will be filed for
patents on any Invention which is the exclusive property of the Company and whether any such
application will be abandoned prior to issuance of a patent.




     (d) Prior Inventions


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     Employee has attached as Schedule B – Prior Inventions a list of all Inventions, patent
applications and patents made or conceived by him prior to the Effective Date, which are
subject to prior agreements or which Employee desires to exclude from this Agreement. If no
such list is attached, Employee hereby represents and warrants that there are no such
Inventions patent applications or patents.



     11. Noncompetition Agreement



     During the term of Employee’s employment by the Company and for a period of twelve (12) months
thereafter, Employee agrees that he will not directly or indirectly, whether as employee, officer,
director, independent contractor, consultant, advisor, financing source, agent, stockholder,
partner, member or otherwise, engage or assist others to engage in or have any interest in any
business which competes with the Company within the geographic region of
North America (the “Non-Compete Region”), unless released in advance from such obligation in
writing by the Company; provided, however, that nothing herein shall prevent the purchase or
ownership by Employee of shares which constitute less than 1% of the outstanding equity securities
of a publicly held corporation, if Employee has no other relationship with such corporation.
Employee acknowledges that he will be responsible for operations that currently include the
Non-Compete Region and the corresponding scope for the non-competition covenant provided in this
Section 11, which Employee agrees is reasonable and necessary in light of the legitimate interests
of the Company and the compensation provided in this Agreement.



     12. Non-Solicitation Covenant



     During the term of Employee’s employment by the Company and for a period of two (2) years
thereafter, Employee agrees that he will not directly or indirectly (i) solicit, divert, take away
or attempt to solicit, divert or take away any customers, clients or other parties who are
currently doing business with the Company or have had business dealings with the Company during the
immediately preceding two (2) year period; or (ii) endeavor to entice away from the Company any of
the employees of the Company.



EMPLOYEE ACKNOWLEDGES THAT THE COVENANTS SET FORTH IN THIS AGREEMENT IN SECTIONS 8
(CONFIDENTIALITY), 9 (RETURN OF CONFIDENTIAL RECORDS), 10 (ASSIGNMENT OF
INVENTIONS), 11 (NONCOMPETITION), AND 12 (NON-SOLICITATION) DO NOT IMPOSE
UNREASONABLE RESTRICTIONS OR WORK A HARDSHIP ON EMPLOYEE, ARE ESSENTIAL TO THE
WILLINGNESS OF COMPANY TO HIRE, TRAIN AND EXPOSE EMPLOYEE TO THE COMPANY’S
CONFIDENTIAL INFORMATION, ARE NECESSARY AND FUNDAMENTAL TO THE PROTECTION OF THE
COMPANY’S BUSINESS, AND ARE REASONABLE AS TO SCOPE, DURATION, AND TERRITORY.



     13. No Conflicting Agreements



     Employee represents and warrants to the Company that (i) the performance of the obligations
under this Agreement will not breach any agreement to keep in confidence proprietary information
acquired by Employee in confidence or in trust prior to the date of this Agreement; (ii) Employee
has not brought and will not bring to the Company or use in the



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performance of his responsibilities at the Company any proprietary information or trade secret
information belonging to any previous employer or other third party, unless Employee has obtained
written authorization to do so and delivered such authorization to the Company; and (iii) Employee
is not a party to, and will not enter into during the term of this Agreement, any agreement, either
written or oral, that conflicts with this Agreement or limits Employee’s ability to carry out his
obligations under this Agreement. Employee agrees to indemnify Company and to hold it harmless
against any and all liabilities or claims arising out of any unauthorized act or acts by Employee
which, the foregoing representation and warranty to the contrary notwithstanding, shall be in
violation or shall constitute a breach of any such commitment, arrangement or understanding.



     14. Additional Covenants



     Employee acknowledges that his employment shall be subject to additional policies, procedures,
and agreements adopted by the Company from time to time, including but not limited to the Company’s
Code of Business Conduct, Insider Trading Policy, and Employee Confidentiality, Non-Disclosure, and
Inventions Agreement. Employee agrees to acknowledge and/or sign such policies, procedures, and/or
agreements as may be required by the Company from time to time. In the event that the terms of any
further policies, procedures, or agreements adopted by the Company address matters already
addressed, either wholly or partially, within this Agreement, those provisions which afford the
Company the greatest protection or benefit shall be deemed to be the governing provisions. The
parties expressly confirm that this section 14 shall not apply to any policy, procedure or
agreement subsequently adopted by the Company which would have the effect of amending or altering
the base salary or termination entitlement of the Employee under this Agreement unless expressly
agreed to by the Employee in writing.



     15. Remedies




     (a) Equitable Relief




     Employee acknowledges that he has knowledge, skill and ability of a special and unique
value. This value will continue to be enhanced as a result of the employment under this
Agreement, and the monetary value of the loss of such knowledge, skill and ability to the
Company may not adequately compensate the Company. Employee therefore agrees that the
Company shall have the right, in addition to any other rights which the Company may have, to
enjoin Employee by appropriate proceedings for an injunction, without the necessity of
posting a bond, from engaging in any act or omission with respect to any breach of this
Agreement by Employee or to obtain other equitable relief with respect to any breach of this
Agreement by Employee. Employee further agrees that all restrictions imposed upon Employee
under this Agreement during and after the term of this Agreement are reasonable and valid,
and Employee waives any defenses to the strict enforcement thereof.




     (b) Other Remedies




     In the event of any breach by Employee of any of the provisions of this Agreement, in
addition to the remedies set forth in this Agreement, the Company shall be entitled to
pursue any other remedies available in law or equity.



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     16. Further Agreements



     Employee shall, at the request of the Company, execute and deliver to the Company such
agreements related to the confidentiality of the Company’s technology and other proprietary rights
or assigning to the Company any inventions developed by Employee for the Company or using
resources, as the Company may reasonably request from time to time.



     17. General




     (a) Governing Law/Jurisdiction/Venue




     This Agreement shall be governed by, construed and enforced in accordance with the laws
of the Province of Ontario, excluding choice of law provisions. Jurisdiction over and venue
of any suit arising out of or related to this Agreement or any issue related to the
employment of Employee shall be exclusively in the courts of the Province of Ontario.




     (b) Notices




     Any notice required or permitted to be given under this Agreement shall be sufficient
if in writing, and personally delivered, or mailed by registered or certified mail, return
receipt requested, to a party at the address or number set forth for the party below, or to
such other address as may be designated from time to time by written notice; the notice
shall be deemed given on the date of personal delivery or the date set forth on the return
receipt.




     (c) Attorneys’ Fees




     If any suit, action or other proceeding of any nature (including any contested matter
or adversary proceeding under the Canadian Bankruptcy Code) is instituted in connection with
any controversy arising out of this Agreement or related to the employment of Employee, or
to interpret or enforce any rights hereunder, the prevailing party shall be entitled to
recover reasonable fees of attorneys, paralegals, accountants and other experts, and all
other fees, costs and expenses actually incurred in connection therewith, as determined by
the judge at trial or on appeal or review, in addition to all other amounts provided by law.




     (d) Amendments and Waivers




     This Agreement may not be amended or otherwise modified, except in a writing executed
by both parties. No provision of this Agreement may be waived except in a writing executed
by the party waiving such provision, and no waiver of breach shall constitute a subsequent
waiver of the same or another breach.




     (e) Benefit and Assignment




     This Agreement shall be binding upon and inure to the benefit of the parties and their
respective successors and assigns. Neither this Agreement nor the rights or duties of



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either party may be assigned by either party without the prior written consent of the
other party, except that in the discretion of the Company the Company may assign,
temporarily or permanently and without Employee’s consent, its rights and obligations under
this Agreement to an affiliate or successor of the Company.




     (f) Entire Agreement




     This Agreement and all other agreements and exhibits referenced herein constitute the
entire understanding and agreement among the parties, supersede any and all prior
agreements, arrangements and understandings with respect to the subject matter of this
Agreement and there are no other agreements, understandings, restrictions, representations
or warranties among the parties with respect to the subject matter of this Agreement other
than those set forth or provided for herein.




     (g) Severability




     If any provision of this Agreement shall be held invalid, illegal or unenforceable in
any jurisdiction for any reason, including, without limitation, the duration of the non
competition provision, its scope or the extent of the activities prohibited or required by
it, then, to the full extent permitted by law (a) all other provisions hereof shall remain
in full force and effect in such jurisdiction and shall be liberally construed in order to
carry out the intent of the parties hereto as nearly as may be possible; (b) such
invalidity, illegality or unenforceability shall not affect the validity, legality or
enforceability of any other provision hereof; and (c) any court having jurisdiction shall
have the power to reform such provision to the extent necessary for such provision to be
enforceable under applicable law.




     (h) Survival of Undertakings




     The provisions of Sections 8, 9, 10, 11 and 12, the general provisions of Section 15,
any post-termination covenants contained in Schedule A – Supplemental Compensation and
Benefits Arrangements, and this Section 17 shall survive the termination of Employee’s
employment with the Company irrespective of the reasons therefor. Employee acknowledges and
agrees that the restrictions imposed upon Employee by Sections 8, 9, 10, 11 and 12, and the
purpose of such restrictions are reasonable and are designed to protect the Confidential
Information and the continued success of the Company without unduly restricting Employee’s
future employment by others.




     (i) Counsel




     BY EXECUTING THIS AGREEMENT, EMPLOYEE ACKNOWLEDGES HE HAS CAREFULLY READ THE TERMS OF
THIS AGREEMENT AND HAS HAD THE OPPORTUNITY TO BE ADVISED BY LEGAL COUNSEL OF HIS CHOICE.
EMPLOYEE HAS OBTAINED LEGAL ADVICE FROM COUNSEL OF HIS CHOOSING.



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	Execution Date:	 	 
	 
	 	 





	 	 	 	 	 
	 

	 	Commencement Date:
	 	April 30, 2006
	 
	 	 	 	 
	 

	 	Employee:
	 	Gary Seiter
	 
	 	 	 	 
	 

	 	Position:
	 	Senior Vice President, Technology
	 
	 	 	 	 
	 

	 	Annual Salary:
	 	$230,000.00





THE PARTIES ACKNOWLEDGE THAT THE EXECUTION DATE LISTED ABOVE IS ON OR BEFORE THE FIRST DAY OF
EMPLOYMENT OF EMPLOYEE BY THE COMPANY




	 	 	 	 	 	 	 
	COMPANY:	 	ATS AUTOMATION TOOLING SYSTEMS INC.	 	 
	 

	 	 	 	 	 	 
	 

	 	By:
	 	/s/ PATTY GOLLING	 	 
	 
	 	 	 	 	 	 
	 

	 	Address:
	 	250 Royal Oak Road	 	 
	 

	 	 	 	Cambridge, Ontario	 	 
	 

	 	 	 	N3H 5M2	 	 
	EMPLOYEE:
	 	 	 	 	 	 
	 

	 	 	 	/s/ GARY SEITER	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:
	 	Gary Seiter	 	 
	 

	 	Address:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 






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Schedule A – Supplemental Compensation and Benefits Arrangements




Bonus Entitlements:




Participate in the bonus program for senior management

(Maximum 30% + 20% over achievement)




Participate in potential options program for senior management (TBD)




Benefits Coverage:




Vacation: 4 weeks/yr.