EXHIBIT 10.12
Key Principal Employment Agreement
THIS AGREEMENT made effective as of the 1st day of February, 2001.
BETWEEN: CANONLINE MEDIA CORPORATION, a company duly incorporated under the
laws of the Province of British Columbia having an office at 0000 Xxxx 0xx
Xxxxxx Xxxxxxxxx Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0 (herein called the "Company")
OF THE FIRST PART
AND: XXXXXXX XXXX #0000 - 000 XXXXX XXXXXX XXXXXXXXX XXXXXXX XXXXXXXX
X0X 0X0 SIN:___________________________
(full legal name and address - include social security/insurance number)
(herein called the "Principal")
OF THE SECOND PART
WHEREAS:
A. The Company carries on the business of conducting scientific research and
development in the areas of computer software and internet communications and
marketing and distributing its various online products and services. In this
Agreement where the context requires, the term "Company" will refer to and
include CanOnline Media Corporation, its parent corporation CanOnline Global
Media, Inc. (USA), affiliates and subsidiaries.
B. It is deemed to be in the best interest of the Company to obtain the
benefit of the services of the Principal as described in Schedule "A" relating
to the Company's business and the Company wishes to engage the services of the
Principal pursuant to the terms and conditions of this Agreement.
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the respective
covenants, conditions and agreements hereinafter contained, the parties hereto
agree as follows:
1. Recitals Incorporated in Agreement
-------------------------------------
The above mentioned recitals are hereby incorporated into this Agreement by
reference and are deemed to be true representations of the relevant party hereto
as the context implies.
2. Engagement
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The Company hereby engages the Principal to provide the Principal's services as
set forth in Schedule "A" for the Term (as hereinafter defined). The Principal
hereby accepts such engagement on the following terms and conditions. Without
limiting the foregoing, it is mutually agreed that during the Term of this
Agreement, the Principal will be responsible and subject to the management and
Board of Directors of the Company, and that the services agreed to be provided
by the Principal will be consistent with those set forth in the Principal's Job
Description or as such Job Description may be amended by the Company from time
to time. The Principal will perform all assigned functions to the satisfaction
of the management and Board of Directors of the Company.
3. Time and Effort - Compliance with Policies
------------------------------------------------
The Principal must apply his full time attention and ability to the business and
affairs of the Company and shall well and conscientiously service the Company
during the Term. It is mutually agreed that the Principal will diligently abide
by any the regulations, instructions, directions and project policies of the
Company and its management and Board of Directors.
4. Non-Disclosure
--------------
Except as required in the performance of the Principal's duties pursuant to this
Agreement, the Principal must not during the Term or for a period of two (2)
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years after termination of this Agreement divulge, publish or disclose in any
manner or medium electronic or otherwise, confidential information of the
Company or any of its subsidiaries or affiliates or any trade secrets thereof to
any person or entity without the prior written consent of the Company. In
addition, the Principal agrees to execute and be absolutely bound by the terms
and conditions of the Principal's Confidentiality and Non-Circumvention
Agreement (the "NDA Agreement") in the form attached hereto as Schedule "B".
Without limiting the generality of the foregoing, the Principal further agrees
that during the Term of this Agreement and any extensions thereof, and for a
period of two (2) years after the Termination Date the Principal agrees that the
Principal will not directly or indirectly approach the Company's customers,
clients, or suppliers of services of a proprietary nature in any manner
whatsoever for any purpose. In addition, without limiting the generality of the
foregoing, the Principal further agrees that the Principal is prohibited from
discussing, commenting, making remarks of any kind, in respect of any matters
that might directly or indirectly be related to the projects, products, methods,
strategies, services and operations of the Company or any of its subsidiaries or
affiliates to individuals or parties outside of the facilities or place of
business of the Company without prior written consent from the management.
5. Permitted Investments and Activities
---------------------------------------
Nothing in this Agreement shall restrict or impede the Principal from holding,
re-investing or liquidating investments held by him at the date hereof or from
participation in any other investment, activity or business so long as such
participation
(a) does not cause conflict or is not contrary to the interests of the
Company; or
(b) does not make it impossible for the Principal to properly fulfil his
duties hereunder; or
(c) does not contain restrictions within those investments, in the case of
securities or benefits issued by the Company to the Principal as compensation or
consideration in kind, that would otherwise violate those restrictions on such
investments; or
(d) does not violate any applicable securities laws or relevant fiduciary
duties afforded by his position or affiliation to the Company or any of its
subsidiaries.
6. Term
----
Subject to the provisions hereof the term of the Principal's rights and
obligations (the "Term") will commence on the Commencement Date set forth in
Schedule "A" (the "Commencement Date") and will terminate, without severance
fees or other payments due from the Company to the Principal on the first
occurring of the following:
(a) upon the Termination Date, if any, set forth in Schedule "A" or any
extensions thereof that might be mutually agreed to by the parties (the
"Termination Date"); or
(b) upon the Principal providing the Company with four (4) week's
written notice of its intent to terminate.
Notwithstanding the foregoing, the continued employment of the Principal by the
Company pursuant to this Agreement is subject to a review and evaluation of the
performance of the Principal by the management of the Company three (3) months
following the Commencement Date (the "Probationary Period") or as soon
thereafter as is reasonably possible (the "Review"). If the Company, in its sole
absolute discretion, determines that the Review or Probationary Period indicates
that the performance of the Principal is not satisfactory then the employment of
the Principal and the Term of this Agreement may be immediately terminated by
the Company upon the Company providing the Principal written notice of its
decision and the effective date of the termination of employment. In that
event, the Principal will only be entitled to receive payment of the Principal's
wages up to the effective date of termination. This Agreement will also be
terminated as of such date except for Paragraphs 4, 14, 15, 16, 17, 18 and 25
hereof, which Paragraphs shall continue in force.
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7. Remuneration
------------
The Company will pay and the Principal agrees to accept as compensation for all
the services to be rendered hereunder for the Term, the remuneration as set
forth in Schedule "A" hereto. The Principal agrees that all deductions from
source required to be made by the Company, if applicable, in respect of the
employment of the Principal including, without limitation, federal income tax
deductions, Workers Compensation, Unemployment Insurance, Canada Pension or like
payments will be made by the Company and the Principal agrees to hold the
Company harmless from any claim made by any competent government authority for
taxes or other deductions which might have been made or remitted by the Company.
8. Benefits
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The Principal shall be entitled to participate in all benefits available in the
benefit plans that the Company might establish, from time to time, for its
Principals (the "Benefits") at the Company's actual cost. The available Benefits
as of the Commencement Date of this Agreement are described in Schedule "A"
hereto.
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9. Holidays
--------
The Principal will be entitled to the number of weeks in each year as set forth
in Schedule "A", the time of which will be agreed by Company and the Principal,
during which no services are required to be rendered hereunder.
10. Expenses and Automobile
-------------------------
The Company agrees to reimburse the Principal for all necessary and authorized
expenses reasonably incurred in connection with the provision and performance of
services hereunder and for which statements and receipts are submitted to the
Company, including authorized travel and other expenses incidental to the duties
undertaken hereunder. The Company agrees to pay the Principal for his use of the
Principal's vehicle for Company business as set forth in Schedule "A".
11. Offices and Staff
-------------------
The Company, at its own cost, will provide the Principal with appropriate
offices and staff assistance if necessary or required, which offices and staff
will be located at the Company's operations in the Greater Vancouver
Metropolitan Area, British Columbia, which will be the Company's place of
business during the Term unless the business of the Company requires a
relocation or expansion of its operations.
12. Termination
-----------
If the Company terminates this Agreement because of a violation of any relevant
criminal or securities law, neglect, incompetence or breach of fiduciary duty of
the Principal, or otherwise for just cause, the Principal will not be entitled
to receive any severance payment or any other remuneration except the fees
payable up to and including the effective date of termination and any amount due
from the Company to settle any pre-existing debt or service obligation.
13. Illness or Disability
-----------------------
If the Principal shall, by reason of illness or mental or physical disability or
incapacity fail to perform, for any two (2) consecutive calendar months in any
calendar year or for three (3) months in the aggregate in any successive
calendar years, the Principal's duties hereunder, the Company may by two (2)
weeks notice in writing to the Principal terminate the employment of the
Principal hereunder, in which event this Agreement, except for Paragraphs 4, 14,
15, 16, 17, 18 and 25 hereof which Paragraphs shall continue in force, and the
employment of the Principal pursuant to this Agreement will be wholly terminated
upon giving two (2) weeks written notice given by the Company to the Principal,
and the Principal shall have no claim against the Company for damages or
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otherwise for such termination except in respect for remuneration as provided
for in Paragraph 7 above to the date of such termination.
14. Intellectual Property Rights
------------------------------
The Principal acknowledges and agrees that the Company is engaging the services
of the Principal to benefit the Company and its various businesses and projects
and that the Principal is being fully compensated for his services by virtue of
the remuneration that the Principal agrees to accept as provided for in this
Agreement. Accordingly, the Principal acknowledges and agrees that the Company
is and at all times will be the sole and absolute owner of all right, title and
interest in and to all copyright, patents, trademarks and all other proprietary
and intellectual property rights relating to the business and operations of the
Company and the services performed by the Principal for the Company, its
affiliates and subsidiaries (collectively called the "Intellectual Property
Rights"). The Principal agrees to waive all so called "moral rights" under any
applicable copyright legislation. The Principal further agrees that at the
request of the Company, the Principal will duly and promptly execute and deliver
to the Company assignments or transfers of any of the Intellectual Property
Rights in the prescribed manner together with all necessary related prescribed
documentation (the "Transfers"). The Transfers shall be in favour of and in the
name of the Company, or any third party designated by the Company, as the
transferee or assignee, at no cost to the Principal. The Principal hereby
irrevocably and absolutely designates and appoints the Company as his
Attorney-in-Fact with full power and authority to duly execute and deliver any
Transfers on behalf of and in the name of the Principal if the Principal is
unable or unwilling to duly execute and deliver any Transfers to the Company.
The provisions of the NDA Agreement attached hereto as Schedule "B" shall also
govern matters pertaining to the Intellectual Property Rights.
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15. Restrictive Covenant
---------------------
The Principal hereby agrees that if the employment of the Principal with the
Company is terminated for any reason whatsoever, that the Principal will be
restricted in his/her business activities for a period of two (2) years from the
date of such termination from directly or indirectly at any time carrying on or
engaging in or being concerned in any trade, operations or business similar to
that carried on by the Company, or from giving any advice to or guaranteeing the
debts of or obligations of, either directly or indirectly, anyone involved in
any such trade, operation or business anywhere within Canada and the United
States of America.
16. Indemnification
---------------
The Principal agrees that the Principal will indemnify the Company and hold it
harmless against any claim or action for infringement of copyright or any other
intellectual property or other proprietary right arising from or in connection
with the use of material contributed by the Principal under the terms of this
Agreement, provided that this indemnity shall not extend to such claims of
infringement of copyright or other intellectual property rights based upon
material supplied by the Principal and in respect of which the Principal had
previously advised the Company in writing that the Principal does not hold the
appropriate intellectual property rights.
17. Return of Records
-------------------
On termination of this Agreement for any reason, the Principal agrees to return
to the Company, as it may direct and at the Principal's cost, all business
records, correspondence, files, technical data, equipment samples and other
material or records in his possession at the time of such termination and
belonging to or supplied by the Company, its customers, suppliers or
shareholders.
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18. Equipment
---------
It is mutually agreed that the Principal will be responsible for the custody and
care of any equipment or supplies of the Company or other person or entity that
the Principal might use in the performance of the Principal's services herein.
It is further agreed that no equipment purchased and provided for the Principal
by the Company may leave the premises of the Company without authorization or
consent from two other principals or supervisors. The Principal hereby
understands and agrees that any breach of the provisions of this section may, at
the Company's sole absolute discretion, be cause for his or her immediate
termination under the terms and conditions of this Agreement.
19. Monitoring of Principal
-------------------------
The Principal acknowledges, understands and agrees that the Company is
developing and possesses certain confidential proprietary information,
materials, systems and trade secrets including, without limitation, technical,
business and financial information that if disclosed could result in substantial
loss and damage to the Company. Accordingly, the Principal acknowledges,
understands and agrees that the Company must protect its confidential and
proprietary information by utilizing a variety of monitoring and surveillance
systems and search equipment that will monitor and observe the Principal and the
activities of the Principal as well as other Principals including, without
limitation, video and audio surveillance recording systems, interception of
email and other document communications made by and to the Principal, monitoring
of Principal's telephone conversations, and monitoring of Principal's computer
activities. The Principal hereby agrees and consents to being subject to all
such monitoring and surveillance systems and activities whether performed
directly by the Company or by any third party acting on the Company's behalf.
20. Non-Waiver of Contractual Rights
-----------------------------------
The failure of either party to enforce any provision of this Agreement will not
be construed as a waiver or limitation of that party's right to subsequently
enforce and compel strict compliance with each and every provision of this
Agreement.
21. Insurance
---------
The Company reserves the right to retain life or key-man insurance on the life
of the Principal in an amount that the Company determines. The costs of such
insurance will be borne entirely by the Company and the benefits of such
insurance will be entirely the property of the Company.
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22. Assignment
----------
This Agreement is not assignable by the Principal. The Company may assign this
Agreement without the consent of the Principal.
23. Modification
------------
No modification of this Agreement will be valid unless made in writing and
signed by the parties hereto and the execution by the Company of such
modifications will be in accordance with its Articles.
24. Governing Law
--------------
This Agreement shall be construed and enforced pursuant to the laws in force in
the Province of British Columbia and Canada. Each of the parties hereto attorn
to the jurisdiction of the Courts of the Province of British Columbia which
shall have exclusive jurisdiction in respect of all matters relating to or
arising out of this Agreement.
25. Arbitration
-----------
All disputes arising out of or in connection with this Agreement that cannot be
settled from discussion between and the mutual agreement of the parties, shall
be referred to and finally resolved by arbitration under the "Rules For Domestic
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Commercial Arbitration Proceedings" of the British Columbia International
Commercial Arbitration Centre ("BCICAC"). The appointing authority will be the
BCICAC and the case will be administered by BCICAC in accordance with its
"Procedures for Cases under the BCICAC Rules". The place of arbitration will be
Vancouver, British Columbia. If any of the foregoing rules or facilities for
arbitration are not in force or available at the time that any arbitration is to
be held then the parties must mutually agree to alternative and appropriate
arbitration rules of procedure or facilities, as the case may be.
26. Notice
------
Any notice required or permitted to be given in respect of this Agreement shall
be validly given if in writing and either hand delivered, communicated by
facsimile transmission or sent by prepaid mail to the other party to their
respective addresses or fax numbers appearing on the first page of this
Agreement, or to such other address or fax number as a party hereto may notify
the other party in writing. Any notice which is hand delivered to a party or
sent by facsimile transmission shall be deemed to be delivered on the date of
such hand delivery or facsimile transmission and notices mailed by prepaid post
shall be deemed delivered on the second business day following such posting.
27. Severability
------------
If any provision of this Agreement is unenforceable or invalid for any reason
whatever, such unenforceability or invalidity shall not affect the
enforceability or validity of the remaining provisions of this Agreement and
such provisions shall be severable from the remainder of this Agreement.
28. Entire Agreement
-----------------
The provisions herein and in the Schedules hereto constitute and contain the
entire employment agreement between the parties hereto and supersedes all
previous understandings, communications, representations and agreements, whether
verbal or written, between the parties with respect to the subject matter
hereof.
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IN WITNESS WHEREOF this Agreement was duly executed by the parties hereto as of
the day and year first above written.
CANONLINE MEDIA CORPORATION )
)
)
)
Per: ______________________________ )
)
)
)
Per: ______________________________ )
)
SIGNED, SEALED & DELIVERED )
BY THE PRINCIPAL in the presence of: )
)
)
)
_________________________________ ) _____________________________
Signature of Witness ) THE PRINCIPAL
SOCIAL INS. /SECURITY
)
)
_________________________________ )
Address of Witness )
)
_________________________________ )
Occupation of Witness )
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SCHEDULE "A"
------------
Section numbers listed below correspond to Paragraph numbers in the Agreement.
Recital B. and Paragraph 2. Engagement
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Description of the Principal's skills and services:
- Business Development and Start-up Management
- Technology Architecture and Product Design
- Film, Music and Entertainment Packaging and Production
Principal's Position & Title:
- Chief Product Development & Operations Officer
Principal's Duties & Responsibilities:
- Manage and Coordinate Operations and Production
- Manage Sales and Marketing for Product Market Applications
- Manage Strategic Product Development & Architecture
- Identify qualified Personnel for Production and Administration
- Duties as might be assigned by the Board of Directors or direct Management
Paragraph 6. Term
-------------------
Commencement Date: _______February 1, 2001___________
Evaluation Date: ________________________________
Paragraph 7. Remuneration
---------------------------
Description of the Principal's Remuneration and terms of payment, etc.:
(a) Wages: $__4,500 CAD_ per Month (review pending 3 and 6 months
thereafter)
(b) Principal Stock Options, if any:
1. If the Principal successfully remains through his Probationary Period,
then the Principal will be entitled to receive Stock Grants or
participate in the Company's Stock Option Plan provided for by its
Parent Company. This determination will solely be at the discretion of
the Board of Directors of the Company and the Board of Directors of
its parent Company.
2. Terms and Conditions of any Stock Grants or Stock Options will be
provided for and governed by a separate and independent agreement
issued by its parent company (the "Stock Agreement").
3. If the Principal is terminated or resigns for any reason, the
treatment of any issued Stock Grants or Stock Options after such
termination or resignation will be determined and governed by such
Stock Agreement issued by its parent company
(c) Bonus to be determined on performance on an annual basis to be solely
determined by direct management or Board of Directors of the Company.
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Paragraph 8. Benefits
-----------------------
Description of the Benefits available:
- Full Extended Medical after 3 months of Service subject to the
affordability of the Company
- Full Dental after 6 months of Service subject to the affordability of the
Company
Paragraph 9. Holidays
-----------------------
Number of weeks of holiday available to the Principal:
- 3 weeks after first year
- Statutory Holidays
Paragraph 10. Expenses and Automobile
-----------------------------------------
The Company agrees to pay Principal mileage at the rate of $_____ per
kilometre for his use of the Principal's vehicle for Company business or $______
per month whichever is greater.
- Principal has up to $1,000 a month in personal expense allowance as a
taxable benefit. Principal must provide for valid receipts at the end of each
month prior to reimbursement. Source income/benefit deductions will not be
deducted immediately from such personal expense allowance until the end of each
fiscal year.
- Principal may submit valid receipts for reasonable meals, gasoline and
travel expenditures that are directly attributed to the normal course of
business of the Company.
- At the financial affordability of the Company, the Principal may at his
election, be provided a lease vehicle of not greater than $750 per month in
lease payments every three years and the Company agrees to provide such vehicle
and all necessary maintenance, up-keep and insurance coverage for his sole use.
The Principal agrees that such lease vehicle will be the property of the Company
during his use and in the event of his termination or resignation, the Principal
shall have an option to purchase or assume the lease vehicle from the Company
under terms to be mutually determined by the Principal and the Company at the
time of such event. In the event the Company cannot afford to provide such lease
vehicle during the duration of the Term of this Agreement, the Principal agrees
that he cannot not claim for any past loss of this benefit.
- Reasonable Parking Disbursement or facilitation of parking space
Special Particulars (If any)
-------------------------------
- Principal under review and probationary period for no less than 3 months
and no greater than 6 months.
- Security Level (Black). - Principal has complete access to sensitive level
networking, design and project operations.
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- Principal cannot conduct third party consultation work, carry out
part-time employment or contract assignments similar to that of the projects or
operations of the Company. Principal understands and agrees that the Company may
at its sole right without notice, terminate the employment of the Principal in
the event a breach of this particular is discovered with prior disclosure or
authorization as specifically described herein.
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