Exhibit 10.22
EMPLOYMENT AGREEMENT
THIS AGREEMENT dated as of May 4th, 1999 is between Tucows International
Corp. (the "Company") and Xxxxxx Xxxx (the "Executive").
RECITALS
WHEREAS:
A. The Company wishes to employ the Executive on the terms and
conditions set out below.
B. The Executive wishes to be so employed by the Company.
For good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:
ARTICLE ONE: TERM
1.1 EMPLOYMENT. The Company shall employ the Executive and the Executive shall
perform services on behalf of the Company as its employee as provided herein
during the Period of Active Employment.
1.2 PERIOD OF ACTIVE EMPLOYMENT. In this Employment Agreement, "Period of
Active Employment" shall mean the period beginning on or about May 4, 1999 and
terminating on the date on which the first of the following occurs:
(i) May 4, 2002;
(ii) the termination of the Executive's employment by the Company for
cause as provided in Section 5.1 hereof;
(iii) the Disability of the Executive; or,
(iv) the death of the Executive.
ARTICLE TWO: POSITION
2.1 CAPACITY AND SERVICES. The Company shall employ the Executive in the
position of President. As such, the Executive shall perform such duties and have
such authority as may from time to time be assigned, delegated or limited by the
board of directors of the Company, consistent with such position (the "Board").
The Executive shall perform these duties in
accordance with the charter documents and by-laws of the Company, the
instructions of the Board, and Company policy.
2.2 FULL TIME AND ATTENTION. The Executive shall devote one hundred percent of
the Executive's business time to the Executive's duties hereunder, provided,
however, that the Executive may serve as a member of the board of directors of
another company if the Board, or an appropriate committee thereof, determines in
its sole discretion that such membership is not adverse to the interests of the
Company.
ARTICLE THREE: COMPENSATION AND BENEFITS
3.1 COMPENSATION. The base salary rate of the Executive shall be
(US)$100,000.00 per year, payable bi-weekly. The Executive's base salary will be
paid in Canadian dollars, with the U.S. dollar amount of each bi-weekly
installment to be converted to Canadian dollars on the date of payment using the
rate of exchange quoted in The Toronto Globe & Mail on the date of payment. The
base salary received by the Executive shall be subject to an annual review by
the Board, as a result of which the Board, in its sole discretion may increase
this base salary rate. The Company may withhold from any amounts payable under
this Employment Agreement such federal or provincial taxes and other statutory
remittances as shall be required by law to be so withheld. The Executive shall
also be entitled to options to purchase two and one half percent (2 1/2%) of the
common shares of Xxxxxx.xxx Inc., the Company's parent company (the "Parent")
(treating the Parent's convertible preferred stock as the common stock into
which it is then convertible) in accordance with the Parent's stock option plan
to be put into effect in the 1999 fiscal year. The grant of such stock options
shall be subject in all respects to the terms and conditions attached to options
granted by the Parent under its stock option plan. Ten percent (10%) of such
options shall vest on the creation of such stock option plan, and thirty percent
(30%) of such options shall vest on each of the first, second and third
anniversaries of the date hereof, unless the Executive has resigned or been
terminated for cause prior to any such date.
3.2 BENEFITS. The Company shall provide the Executive with the benefits
described in Schedule "A". The Company may, at any time and from time to time,
modify, suspend, or discontinue any or all such benefits for its employees
generally or for any group thereof, without any obligation to replace any such
modified, discontinued or suspended benefit with any other benefit, equivalent
or otherwise, or to otherwise compensate the Executive in respect thereof. Upon
the achievement by the Executive of certain performance related goals, which
shall be established by the Company and the Executive, the Company may, in its
sole discretion, pay to the Executive an annual bonus. The payment of any bonus
will be paid at a date or dates as determined by the Board.
3.3 VACATION. The Executive is entitled to take three (3) weeks paid vacation
per calendar year in accordance with the Company's policies and practices for
senior executives and subject to the needs of the Company. Any vacation not
taken during the current year can be carried over to June 30 of the following
year.
3.4 EXPENSES INCIDENTAL TO EMPLOYMENT. The Company shall reimburse the
Executive in accordance with its normal policies and practices for the
Executive's travel and other expenses or disbursements reasonably incurred or
made in connection with the Company's business.
3.5 CAR ALLOWANCE. The Company shall provide the Executive with a reasonable
car allowance.
ARTICLE FOUR: CONFIDENTIALITY AND NON-COMPETITION
4.1 NON-COMPETITION. The Executive acknowledges that the Executive's services
are unique and extraordinary. The Executive also acknowledges that the
Executive's position will give the Executive access to confidential information
of substantial importance to the Company, the Parent and their respective
businesses. The Executive shall not, either individually or in partnership or
jointly or in conjunction with any other person, entity or organization, as
principal, agent, consultant, lender, contractor, employer, employee, investor,
shareholder or in any other manner, directly or indirectly, advise, manage,
carry on, establish, control, engage in, invest in, offer financial assistance
or services to, or permit the Executive's name or any part thereof to be used
by: (i) any business that competes with or is substantially the same as any of
the businesses conducted by the Company and the Parent on the date hereof (as
described in Schedule "B") for a period beginning on the date hereof and ending
three (3) years after the end of the Period of Active Employment (the "Existing
Business Non-Competition Period:"); and (ii) any business that competes with any
new or developed business of the Company or the Parent developed, entered into
or engaged in by the Company or the Parent in any country in which the Company
or the Parent has substantial business operations from and after the date of
this Agreement to the end of the Period of Active Employment (collectively the
"Expanded Business"), for a period beginning on the date hereof and ending six
(6) months after the end of the Period of Active Employment (the "Expanded
Business Non-Competition Period"). This section shall not restrict the Executive
from making any investment in a public company the shares of which are listed on
a stock exchange where such investment does not exceed two percent (2%) of the
issued equity shares of the public company. The three year period referred to
above shall be shortened to two years should the Company elect to terminate the
Executive's employment without cause.
4.2 OTHER EXECUTIVES, CUSTOMERS. The Executive agrees that for a period
beginning on the date hereof and ending three years after the end of the Period
of Active Employment, neither the Executive nor any entity with whom the
Executive is at the time associated, related or affiliated shall, directly or
indirectly, hire or offer to hire or entice away or in any other manner persuade
or attempt to persuade any officer, employee, agent, supplier or customer of the
Business and/or the Expanded Business to discontinue or alter any one of their
or its relationship with the Company or the Parent.
4.3 CONFIDENTIALITY. Except in the normal and proper course of the Executive's
duties hereunder, the Executive will not use for the Executive's own account or
disclose to anyone else, during or for a period of three (3) years after the
Period of Active Employment, any confidential or proprietary information or
material relating to the Company's or the Parent's operations or business which
the Executive obtains from the Company, the Parent or their respective officers
or employees, agents, suppliers or customers or otherwise by virtue of the
Executive's employment by the Company or by the Company's predecessor.
Confidential or proprietary information or material includes, without
limitation, the following types of information or material, both existing and
contemplated, regarding the Company or its Parent or affiliated or subsidiary
companies: corporate information, including contractual licensing arrangements,
plans, strategies, tactics, policies, resolutions, patent, trade-xxxx and trade
name applications, and any litigation or negotiations; information concerning
suppliers; marketing information, including sales, investment and product plans,
customer lists, strategies, methods, customers, prospects and market research
data; financial information, including cost and performance data, debt
arrangements, equity structure, investors and holdings; operational information,
including trade secrets; technical information, including technical drawings and
designs; and personnel information, including personnel lists, resumes,
personnel data, organizational structure and performance evaluations (other than
the Executive's own performance evaluation) (the "Confidential Information").
The Executive's obligations under this Section shall not extend to any
information which (i) is generally available to the public, (ii) corresponds to
information furnished to him by any third party having a bona fide right to do
so, or (iii) corresponds to any information furnished by the Company to any
third party on a non-confidential basis. Furthermore, the Executive may disclose
any Confidential Information to the extent required by applicable law or
regulation or by any order, degree or directive of a competent judicial,
legislative or regulatory body or authority.
4.4 RETURN OF DOCUMENTS. The Executive agrees that all documents (including,
without limitation, software and information in machine-readable form) of any
nature pertaining to activities of the Company or the Parent and their
respective affiliated, related, associated or subsidiary companies, including
Confidential Information, in the Executive's possession now or at any time
during the Period of Active Employment, are and shall be the property of the
Company and the Parent, and their respective affiliated, related, associated or
subsidiary companies, and that all such documents and all copies of them shall
be surrendered to the Company whenever requested by the Company.
4.5 OWNERSHIP OF RIGHTS. The Executive agrees to promptly and fully disclose
to the Company all writings and other works, including, but not limited to,
designs, business plans, logos, products, computer programs, software and all
inventions, know-how, trade secrets, business techniques created or developed by
him in the course of his employment and hereby acknowledges that all rights
therein shall vest in the Company as the original owner thereof, and the
Employee shall have no rights therein.
4.6 BLUE PENCIL. If any court determines that any provision contained in this
Employment Agreement including, without limitation, a restrictive covenant or
any part thereof is unenforceable because of the duration or geographical scope
of the provision or for any other reason, the duration or scope of the
provision, as the case may be, shall be reduced so that the provision becomes
enforceable and, in its reduced form, the provision shall then be enforceable
and shall be enforced.
4.7 ACKNOWLEDGEMENT. The Executive acknowledges that, in connection with the
Executive's employment by the Company, the Executive will receive or will become
eligible to
receive substantial benefits and compensation. The Executive acknowledges that
the Executive's employment by the Company and all compensation and benefits and
potential compensation and benefits to the Executive from such employment shall
be conferred by the Company upon the Executive only because and on condition of
the Executive's willingness to commit the Executive's best efforts and loyalty
to the Company, including protecting the Company's right to have its
Confidential Information protected from non-disclosure by the Executive and
abiding by the confidentiality, non-competition and other provisions herein. The
Executive understands the Executive's duties and obligations as set forth in
Section 4.1 and agrees that such duties and obligations would not unduly
restrict or curtail the Executive's legitimate efforts to earn a livelihood
following any termination of the Executive's employment with the Company. The
Executive agrees that the restrictions contained in Section 4 are reasonable and
valid and all defences to the strict enforcement thereof by the Company are
waived by the Executive. The Executive further acknowledges that irreparable
damage would result to the Company if the provisions of Sections 4.1 through 4.4
are not specifically enforced, and agrees that the Company shall be entitled to
any appropriate legal, equitable, or other remedy, including injunctive relief,
in respect of any failure or continuing failure to comply with provisions of
Sections 4.1 through 4.4.
ARTICLE FIVE: TERMINATION AND RESIGNATION
5.1 TERMINATION FOR CAUSE. The Company may immediately terminate this
Employment Agreement at any time for cause at common law by written notice to
the Executive. If the Company terminates this Employment Agreement for cause
under this Section 5.1, the Company shall not be obligated to make any further
payments under this Employment Agreement except amounts due and owing pursuant
to Article 3 at the time of the termination.
5.2 DISABILITY. "Disability" as used in this Employment Agreement shall mean a
physical or mental incapacity of the Executive which in the reasonable opinion
of the Company's Board of Directors has prevented the Executive from performing
the essential duties customarily assigned to the Executive for one hundred and
eighty (180) days, whether or not consecutive, out of any twelve (12)
consecutive months and that in the opinion of the Board is likely to continue,
subject to any accommodation required by law. If the Executive's Period of
Active Employment terminates by reason of Disability, the Executive shall
receive, in lieu of all amounts otherwise payable hereunder (except for amounts
due and owing pursuant to Article 3 at the date of such Disability),
compensation at the Executive's base salary rate for a six (6) month period
following the date of Disability.
5.3 TERMINATION WITHOUT CAUSE. The Company may terminate the Executive's
employment without cause at any time, provided the Company continues to provide
the compensation (including stock options) to the Executive provided for herein
until May 4, 2002.
5.4 RESULTS OF TERMINATION. Upon termination of the Executive's employment
pursuant to Article 5, this Agreement and the employment of the Executive shall
be wholly terminated with the exception of the clauses specifically contemplated
to continue in full force and effect beyond the termination of this Employment
Agreement, including those set out in Article 4. The
Executive agrees and acknowledges that upon termination or resignation of the
Executive's employment pursuant to Article 5, he shall immediately resign from
any director's or officer's position which the Executive may hold with the
Company, the Parent and their respective affiliated, related, associated or
subsidiary companies.
ARTICLE SIX: REPRESENTATIONS AND WARRANTIES
6.1 REPRESENTATIONS AND WARRANTIES. The Executive represents and warrants to
the Company that the execution and performance of this Employment Agreement will
not result in or constitute a default, breach, or violation, or an event that,
with notice or lapse of time or both, would be a default, breach, or violation,
of any understanding, agreement or commitment, written or oral, express or
implied, to which the Executive is a party or by which the Executive or the
Executive's property is bound. The Executive shall defend, indemnify and hold
the Company harmless from any liability, expense or claim (including solicitor's
fees incurred in respect thereof) by any person in any way arising out of,
relating to, or in connection with any incorrectness or breach of the
representations and warranties in this Section 6.1. The Executive acknowledges
that a breach of this Article by the Executive shall entitle the Company to
terminate the Executive's employment and this Employment Agreement for cause.
ARTICLE SEVEN: MISCELLANEOUS COVENANTS
7.1 RIGHTS AND WAIVERS. All rights and remedies of the parties are separate
and cumulative, and none of them, whether exercised or not, shall be deemed to
be to the exclusion of any other rights or remedies or shall be deemed to limit
or prejudice any other legal or equitable rights or remedies which either of the
parties may have.
7.2 WAIVER. Any purported waiver of any default, breach or non-compliance
under this Employment Agreement is not effective unless in writing and signed by
the party to be bound by the waiver. No waiver shall be inferred from or implied
by any failure to act or delay in acting by a party in respect of any default,
breach or non-observance or by anything done or omitted to be done by the other
party. The waiver by a party of any default, breach or non-compliance under this
Employment Agreement shall not operate as a waiver of that party's rights under
this Employment Agreement in respect of any continuing or subsequent default,
breach or non-observance (whether of the same or any other nature).
7.3 SEVERABILITY. Any provision of this Employment Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to that jurisdiction,
be ineffective to the extent of the prohibition or unenforceability and shall be
severed from the balance of this Employment Agreement, all without affecting the
remaining provisions of this Employment Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
7.4 NOTICES.
(1) Any notice, certificate, consent, determination or other
communication required or permitted to be given or made under this
Employment Agreement shall be in writing and shall be effectively
given and made if (i) delivered personally, (ii) sent by prepaid
courier service or mail, or (iii) sent prepaid by fax or other
similar means of electronic communication, in each case to the
applicable address set out below:
(a) if to the Company, to:
x/x Xxxxxx Xxxxxxx Xxxx.
X.X. Xxx 0000
0000, Xxxxxx, Xxxxxxxxxxx
and with a copy to:
Xxxxxxx Xxxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Xxxxxx X. Xxxxxxx
Fax: (000) 000-0000
if to the Executive, to:
000 Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
(2) Any such communication so given or made shall be deemed to have been
given or made and to have been received on the day of delivery if
delivered, or on the day of faxing or sending by other means of
recorded electronic communication, provided that the day in either
event is a business day and the communication is so delivered, faxed
or sent prior to 4:30 p.m. on that day. Otherwise, the communication
shall be deemed to have been given and made and to have been
received on the next following business day. Any such communication
sent by mail shall be deemed to have been given and made and to have
been received on the fifth business day following the mailing
thereof; provided however that no such communication shall be mailed
during any actual or apprehended disruption of postal services. Any
such communication given or made in any other manner shall be deemed
to have been given or made and to have been received only upon
actual receipt.
(3) Any party may from time to time change its address under this
Section 9.4 by notice to the other party given in the manner
provided by this Section.
7.5 TIME OF ESSENCE. Time shall be of the essence of this Employment Agreement
in all respects.
7.6 SUCCESSORS AND ASSIGNS. The Company shall have the right to assign this
Employment Agreement to any successor, subsidiary or affiliate (whether direct
or indirect, by purchase, amalgamation, arrangement, merger, consolidation or
otherwise of all or substantially all of the business and/or assets of the
Company) provided only that the Company must first require the successor,
subsidiary or affiliate to expressly assume and agree to perform this Employment
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place. The Executive by
the Executive's signature hereto expressly consents to such assignment. The
Executive shall not assign or transfer, whether absolutely, by way of security
or otherwise, all or any part of the Executive's rights or obligations under
this Employment Agreement.
7.7 AMENDMENT. No amendment of this Employment Agreement will be effective
unless made in writing and signed by the parties.
7.8 ENTIRE AGREEMENT. This Employment Agreement constitutes the entire
agreement between the parties pertaining to the subject matter of this
Employment Agreement and supersedes all prior agreements, understandings,
negotiations and discussions, whether oral or written. There are no conditions,
warranties, representations or other agreements between the parties in
connection with the subject matter of this Employment Agreement (whether oral or
written, express or implied, statutory or otherwise) except as specifically set
out in this Employment Agreement.
7.9 GOVERNING LAW. This Employment Agreement shall be governed by and
construed in accordance with the laws of the Province of Ontario and the laws of
Canada applicable in that Province and shall be treated, in all respects, as an
Ontario contract. The parties hereby attorn to the non-exclusive jurisdiction of
the courts of the Province of Ontario.
7.10 HEADINGS. The division of this Employment Agreement into Sections and the
insertion of headings are for convenience or reference only and shall not affect
the construction or interpretation of this Employment Agreement.
ARTICLE EIGHT: EXECUTIVE ACKNOWLEDGEMENT
8.1 ACKNOWLEDGEMENT.
The Executive acknowledges that:
(a) the Executive has had sufficient time to review this Employment
Agreement thoroughly;
(b) the Executive has read and understands the terms of this Employment
Agreement and the obligations hereunder;
(c) the Executive has been given an opportunity to obtain independent
legal advice concerning the interpretation and effect of this
Employment Agreement; and,
(d) the Executive has received a fully executed counterpart copy of this
Employment Agreement.
IN WITNESS WHEREOF the parties have executed counterpart copies of this
Employment Agreement.
/s/ Xxxxxx Xxxx
------------------------------------ --------------------------------------
Witness XXXXXX XXXX
TUCOWS INTERNATIONAL CORP.
Per: /s/ Xxxx Xxxx
--------------------------------
NAME: NAME
TITLE: TITLE
I/WE HAVE THE AUTHORITY TO BIND
THE CORPORATION
SCHEDULE "A"
BENEFITS REFERRED TO IN SECTION 3.1 OF THE EMPLOYMENT AGREEMENT
The Executive shall be entitled to benefits provided to the Company's employees
pursuant to any Benefit Plans (as that term is defined in the asset purchase
agreement dated May 4, 1999 among, INTER ALIA, the Executive and the Company) in
effect from time to time.
SCHEDULE "B"
For the purposes of Section 4.1 of the Employment Agreement, the businesses are
comprised of INTER ALIA: (i) the maintenance of a web site and interactive
libraries of computer programs which can be downloaded by Internet users
throughout the world from such web site and mirror sites; (ii) the on-line sale
of software; (iii) the provision of domain services to third parties; and (iv)
the sale of "Tucows" merchandise.
July 19, 2001
Xx. Xxxxxx Xxxx
President and CEO
Tucows Inc.
00 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Dear Elliot:
RE: EMPLOYMENT AGREEMENT
Reference is made to the Employment Agreement dated May 4, 1999 (the
"Agreement") executed by yourself and Tucows Inc. (formerly Xxxxxx.xxx Inc.)
("Tucows") regarding the terms of your employment. By this letter, the parties
have agreed to revise the terms of Article 3.1 of the Agreement and to formally
acknowledge and accept the past practices between the parties.
Article 3.1 of the Agreement is accordingly deleted and replaced with the
following clause:
3.1 COMPENSATION. The base salary rate of the Executive shall be
Cdn.$150,000 per year payable semi-monthly. The base salary received by
the Executive shall be subject to an annual review by the Board, as a
result of which the Board, in its sole discretion, may increase this
base salary rate. The Company may withhold from any amounts payable
under this Employment Agreement such federal or state taxes or other
statutory remittances as shall be required by law to be so withheld.
The Executive shall also be entitled to options to purchase common
shares of the Company in accordance with the Company's stock option
plan. The grant of such stock options shall be subject in all respects
to the terms and conditions attached to options granted by Company
under its stock option plan.
-2-
Save and except as outlined above, all terms and conditions agreed by the
parties in the Agreement shall remain in full force and effect. If the foregoing
meets with your approval, I ask that you indicate same by signing where
indicated below and returning a copy of this letter to the attention of the
undersigned.
Sincerely,
/s/ Xxxxxx Xxxxxx
---------------------------
Xxxxxx Xxxxxx
General Counsel, Tucows Inc.
/SLC
*****
AGREED AND ACCEPTED
this 19th day of July, 2001.
/s/ Xxxxxx Xxxx
-----------------------
Xxxxxx Xxxx
