EMPLOYMENT AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into, as of
this 28thday of November, 2001 ("Effective Date"), by and between Xxxxxx X.
French an individual resident of the City of Toronto in the Province of Ontario
("Executive"), and Thinkpath Inc., a corporation formed under the laws of the
Province of Ontario ("Employer") with its principal place of business at 00
Xxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0.
W I T N E S S E T H
WHEREAS, Employer desires to employ Executive, and Executive
desires to be employed by Employer, on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, in consideration of the premises and the
mutual promises and agreements contained herein, the parties hereto, intending
to be legally bound, hereby agree as follows:
SECTION 1.EMPLOYMENT.
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1.1 Subject to the terms hereof, Employer hereby employs
Executive, and Executive hereby accepts such employment. Executive will serve in
the capacity of Chief Executive Officer of Employer and will have duties and
responsibilities customarily assigned to a person with such title. Executive
hereby agrees that, throughout his period of employment, he shall devote his
business time, attention, knowledge and skills, diligently in the furtherance of
the business of the Employer and of its subsidiaries and affiliates, shall
perform his duties consistent with his position with Employer and shall observe
and carry out such rules and regulations, policies and directions as Employer
may from time to time establish to the extent consistent herewith. During the
term of this Agreement, Executive shall do such traveling as may be reasonably
required of him in the performance of his duties on behalf of Employer.
SECTION 2.TERM OF EMPLOYMENT.
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2.1 The term of Executive's employment hereunder (the "Initial
Term") shall be from the Effective Date and expire at the earlier of (a) the
second anniversary of the date of this Agreement or (b) the occurrence of any of
the following events:
(i) The death or total disability of Executive (total
disability meaning the failure to substantially
perform his normal required services hereunder
for a period of six (6) consecutive months during
any consecutive twelve (12) month period during
the term hereof, as determined by an independent
medical doctor jointly chosen by the Executive
and the Employer, by reason of mental or physical
disability); or
(ii) The termination by Employer of Executive's
employment hereunder, upon thirty (30) days prior
written notice to Executive, which termination
shall be for "Cause", as determined by the Board
of Directors of Employer in accordance with the
terms hereof. For purposes of this Agreement,
"Cause" for termination of Executive's employment
shall exist (V) if Executive is convicted of,
pleads guilty to, or confesses to any felony or
any act of fraud, or misappropriation or
embezzlement with regard to Employer, (W) if
Executive has engaged in a dishonest act to the
material damage or prejudice of Employer or an
affiliate of Employer, or in conduct or
activities materially damaging to the property,
business, or reputation of Employer or an
affiliate of Employer, (X) if Executive violates
any of the provisions contained in Section 4 of
this Agreement, after receiving thirty (30) days
written notice from Employer specifically
outlining the alleged violations by the Executive
of Section 4 hereof and Executive has not cured
the alleged violations within thirty (30) days of
receipt of written notice by the Employer; (Y)
Executive willfully breaches or habitually and
recklessly neglects the duties he is required to
perform hereunder, or performs such duties in a
grossly negligent manner, after receiving thirty
(30) days written notice from Employer
specifically outlining the violations of this
Section and Executive has not cured the alleged
violations of this Section within thirty (30)
days of receipt of written notice by Employer.
2.2 SUCCESSIVE TERMS. After the Initial Term, this Agreement
shall continue upon a year-to-year basis (the "Successive Terms"; together with
the Initial Term, the "Term") unless terminated by either the Employer or the
Executive upon ninety (90) days written notice to the other prior to the end of
the Initial Term or the then Successive Term.
SECTION 3.COMPENSATION.
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3.1 TERM OF EMPLOYMENT. Employer will provide Executive with
the following salary, expense reimbursement and additional Executive benefits
during the term of employment hereunder:
(a) SALARY. During the Initial Term, Executive will be
paid a salary (the "Salary"), that shall be no less
than one-hundred-fifty-thousand United States dollars
(US$150,000.00) per annum, less deductions and
withholdings required by applicable law. Thereafter,
and during the Successive Terms, Executive will be
paid a salary to be determined by good faith
negotiations between Employer and Executive, but in
no event shall such salary be less than
one-hundred-fifty-thousand United States dollars
(US$150,000.00) (the "Successive Terms Salary"). The
Salary and Successive Terms Salary shall be paid to
Executive in equal monthly installments (or on such
more frequent basis as other executives of Employer
are compensated).
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(b) PERFORMANCE BONUS.
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(i) Employer shall pay to Executive a performance
bonus based on Employer's EBITDA (which is
defined as Employer's earnings before the
deduction of interest, taxes, depreciation and
amortization as calculated in accordance with
United States generally accepted accounting
principles) at the end of each calendar year
during the Term or then Successive Term, in
accordance with the following schedule:
EBITDA AS A PERCENTAGE
GROSS REVENUE (US DOLLARS)
BONUS (US DOLLARS)
7% US$200,000.00
8% US$300,000.00
9% US$400,000.00
10% US$500,000.00
(ii) The determination of whether Employer has
achieved a certain level of EBITDA in any year
for the purposes of this section shall be made by
the certified chartered accountant regularly
retained or employed by Employer with ninety (90)
days after the end of each calendar year, and
shall be conclusive on Employer and Executive.
(iii) The performance bonus shall, in the sole
discretion of Employer, be payable in cash or
shares of Employer's common stock.
(iv) The performance bonus shall be due and payable
within one-hundred-twenty (120) days after the
end of each calendar year.
(v) Notwithstanding anything to the contrary herein,
Executive shall be entitled to a minimum
performance bonus per calendar year equal to one
hundred thousand United States dollars
($100,000.00)
(c) VACATION. Executive shall be entitled to receive six (6)
weeks paid vacation during each year of employment upon
dates to be taken at such times and in such periods as
shall not interfere with the duties required to be
rendered by Executive hereunder.
(d) EXPENSES. Employer shall reimburse Executive within
thirty (30) days of its receipt of a reimbursement
report with supporting receipts from the Executive, for
all reasonable and necessary expenses incurred by
Executive in performing services hereunder, including
without limitation, all expenses of travel and living
expenses when away from home on business at the request
of or in the service of Employer.
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(e) BENEFIT PLANS. Executive shall have the option of
participating in such medical, dental, disability,
hospitalization, life insurance, stock option and other
benefit plans (such as pension and profit sharing plans)
as Employer maintains from time to time for the benefit
of other full-time Executives of Employer, on the terms
and subject to the conditions set forth in such plans.
(f) CHANGE IN CONTROL.
(i) In the event of a "Change in Control" whereby:
(1) A person (other than a person who is an officer
or Director of Employer on the Effective Date),
including a "group" as defined in Section
13(d)(3) of the Securities Exchange Act of 1934,
as amended, becomes, or obtains the right to
become, the beneficial owner of Employer's
securities having fifty percent (50%) or more of
the combined voting power of then outstanding
securities of Employer;
(2) Employer consummates a merger in which it is not
the surviving entity;
(3) All or substantially all of Employer's assets
are sold; or
(4) Employer's shareholders approve the dissolution
or liquidation of Employers; then
(ii) All stock options and warrants granted by Employer to
Executive under any plan or otherwise prior to the
effective date of the Change in Control, shall become
vested, accelerate and become immediately
exercisable, at the stated exercise price, with the
number of shares and exercise price adjusted for any
stock splits and capital reorganizations that occur
subsequent to the Effective Date; and
(iii) Employer shall, upon the effective date of the Change
in Control, issue to Executive such number of shares
of Employer's common stock as equal to the lesser of:
(1) Nineteen percent (19%) of the issued and
outstanding shares of Employer's common stock as
of the effective date of the Change in Control;
or
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(2) Such number of shares as is calculated by
dividing Five-hundred-thousand United States
dollars (US$500,000.00) by the average of the
closing bid prices (as reported on the NASDAQ
SmallCap Market or principal market on which
Employer's common stock is then traded, and if
not listed on a principal market, the OTC
Bulletin Board or the pink sheets) for the
fifteen (15) trading days immediately preceding
the effective date of the Change in Control.
(g) AUTOMOBILE ALLOWANCE. During the Term, Employer shall
pay Executive one-thousand-four-hundred United Stated
dollars (US$1,400.00) per month as an allowance for the
use of Executive's automobile.
3.2 EFFECT OF TERMINATION. Upon the termination of the
employment of Executive hereunder for Cause, Executive shall be entitled to all
compensation and benefits earned or accrued under Section 3.1 as of the
effective date of termination. Upon the termination of this Agreement for any
reason other than for Cause, Executive shall be entitled to receive all
compensation and benefits earned or accrued under Section 3.1 as of the
effective date of termination plus an amount equal to one (1) year's Salary and
continuation of benefits for a period of one (1) year.
SECTION 4.NONSOLICITATION.
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4.1 DEFINITIONS. For the purposes of this Section 4, the
following definitions shall apply.
(a) "Confidential Information" means any confidential,
proprietary business information or data belonging
to or pertaining to Employer that does not
constitute a "Trade Secret" (as hereinafter
defined) and that is not generally known by or
available through legal means to the public,
including, but not limited to, information
regarding the Employer's customers or actively
sought prospective customers, acquisition targets,
suppliers, manufacturers and distributors gained
by Executive as a result of his employment with
Employer.
(b) "Customer" means actual customers or actively
sought prospective customers of Employer.
(c) "Trade Secrets" means information or data of or
about Employer, including but not limited to
technical or non-technical data, formulas,
patterns, compilations, programs, devices,
methods, techniques, drawings, processes,
financial data, financial plans, products plans,
or lists of actual or potential customers,
clients, distributees or licensees, information
concerning or Employer's finances, services,
staff, contemplated acquisitions, marketing
investigations and surveys, that are not generally
known to, and/or are not readily ascertainable by
proper means by, other persons.
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(d) "Work Product" means any and all work product
property, data documentation or information of any
kind prepared, conceived, discovered, developed or
created by Executive for Employer or its
affiliates' clients or customers for utilization
in Employer's business, not generally known by or
not readily ascertainable by proper means by other
persons who can obtain economic value from their
disclosure or use.
4.2 TRADE NAME AND CONFIDENTIAL INFORMATION.
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(a) Executive hereby agrees that at all times during
the Term and thereafter:
(i) Executive shall not, directly or by assisting
others own, manage, operate, join, control or
participate in the ownership, management,
operation or control of, or be connected in
any manner with, any business conducted under
any corporate or trade name of Employer or
name confusingly similar thereto, without the
prior written consent of Employer;
(ii) Executive shall hold in confidence all Trade
Secrets and all Confidential Information and
will not, either directly or indirectly, use,
sell, lend, lease, distribute, license, give,
transfer, assign, show, disclose,
disseminate, reproduce, copy, appropriate or
otherwise communicate any Trade Secrets or
Confidential Information, without the prior
written consent of Employer; and
(iii) During the Term Executive shall immediately
notify Employer of any unauthorized
disclosure or use of any Trade Secrets or
Confidential Information of which Executive
becomes aware, Executive shall assist
Employer, to the extent necessary, in the
procurement or any protection of Employer's
rights to or in any of the Trade Secrets or
Confidential Information.
(b) Upon the request of Employer, Executive shall deliver to
Employer all memoranda, notes, records, manuals and
other documents, including all copies of such materials
and all documentation prepared or produced in connection
therewith, pertaining to the performance of Executive's
services hereunder or Employer's business or containing
Trade Secrets or Confidential Information, whether made
or complied by Executive or furnished to Executive from
another source by virtue of Executive's employment with
Employer.
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(c) To the greatest extent possible, all Work Product shall
be deemed to be "work made for hire" (as defined in the
Copyright Act, 17 U.S.C.A. Section 101 ET SEQ., as
amended) and owned exclusively by Employer. Executive
hereby unconditionally and irrevocably transfers and
assigns to Employer all rights, title and interest
Executive may have in or to any and all Work Product,
including, without limitation, all patents, copyrights,
trademarks, service marks and other intellectual
property rights arising out of the Work Product.
Executive agrees to execute and deliver to Employer any
transfers, assignments, documents or other instruments
which Employer may deem necessary or appropriate to vest
complete title and ownership of any and all such Work
Product, and all rights therein, exclusively in
Employer.
4.3 NONSOLICITATION AND NONCOMPETE. Executive hereby agrees
that Executive will not, during the Term and for a period of one (1) year
following the Term, either directly or indirectly, alone or in conjunction with
any other party, on the North American continent:
(a) solicit, divert or appropriate or attempt to solicit,
divert or appropriate, any Customer for the purpose of
providing the Customer with services or products
competitive with those offered by Employer during the
Term; or
(b) solicit or attempt to solicit any officer, director,
Executive, consultant, contractor, agent, lessor,
lessee, licensor, licensee, supplier or any shareholder
of Employer or other personnel of Employer or any of its
affiliates or subsidiaries to terminate, alter or lessen
that party's affiliation with Employer or such affiliate
or subsidiary or to violate the terms of any agreement
or understanding between such Executive, consultant,
contractor or other person and Employer; or
(c) engage in, as owner, stockholder, Executive, partner,
agent, representative or otherwise, or have an interest
in (except for ownership of publicly trade securities
representing not more than five percent (5%) of the
outstanding voting shares), any business, firm,
corporation or other entity in direct competition with
the business of Employer.
Nothing contained in this Section 4 shall prohibit
Executive from acquiring not more than five percent (5%) of
any competitor of Employer whose common stock is publicly traded on a national
securities exchange or in the over-the-counter market or from acquiring any
percentage of any company which is non-competitive with Employer.
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SECTION 5.MISCELLANEOUS.
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5.1 SEVERABILITY. The covenants in this Agreement shall be
construed as covenants independent of one another and as obligations distinct
from any other contract between Executive and Employer. Any claim that Executive
may have against Employer shall not constitute a defense to enforcement by
Employer of this Agreement.
5.2 SURVIVAL OF OBLIGATIONS. The covenants in Section 4 of
this Agreement shall survive termination of Executive's employment for the
period set forth therein.
5.3 NOTICES. Any notice or other document to be given
hereunder by any party hereto to any other party hereto shall be in writing and
delivered in person or by courier, by telecopy transmission or sent by any
express mail service, postage or fees prepaid at the following addresses:
EMPLOYER: Thinkpath Inc.
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00 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Secretary
WITH A
COPY TO: Xxxxxxx, Xxxxxx & Xxxxxxxxx, LLP
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000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
EXECUTIVE: Xxxxxx X. French
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0000 Xxxxxxxxx Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
Telephone: (000) 000-0000
or at such other address or number for a party as shall be specified by like
notice. Any notice which is delivered in the manner provided herein shall be
deemed to have been duly given to the party to whom it is directed upon actual
receipt by such party or its agent.
5.4 BINDING EFFECT. This Agreement inures to the benefit of,
and is binding upon, Employer and their respective successors and assigns, and
Executive, together with Executive's executor, administrator, personal
representative, heirs, and legatees.
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5.5 ENTIRE AGREEMENT. This Agreement is intended by the
parties hereto to be the final expression of their agreement with respect to the
subject matter hereof and is the complete and exclusive statement of the terms
thereof, notwithstanding any representations, statements or agreements to the
contrary heretofore made. This Agreement supersedes and terminates all prior
employment and compensation agreements, arrangements and understandings between
or among Employer and Executive. This Agreement may be modified only by a
written instrument signed by all of the parties hereto.
5.6 GOVERNING LAW. This Agreement shall be deemed to be made
in, and in all respects shall be interpreted, construed, and governed by and in
accordance with, the laws of the Province of Ontario. No provision of this
Agreement shall be construed against or interpreted to the disadvantage of any
party hereto by any court or other governmental or judicial authority or by any
board of arbitrators by reason of such party or its counsel having or being
deemed to have structured or drafted such provision.
5.7 ATTACHMENT. Except as required by law, the right to
receive payments under this Agreement shall not be subject to attachment, sale,
pledge, encumbrance, charge, levy or similar process or assignment, and any
attempt to do so shall be null and void.
5.8 HEADINGS. The section and paragraph headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.
5.9 SPECIFIC PERFORMANCE. Each party hereto hereby agrees that
any remedy at law for any breach of the provisions contained in this Agreement
shall be inadequate and that the other parties hereto shall be entitled to
specific performance and any other appropriate injunctive relief in addition to
any other remedy such party might have under this Agreement or at law or in
equity.
5.10 COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed to be an original but all of
which together shall constitute one and the same instrument.
(SIGNATURES ON THE FOLLOWING PAGE)
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the 28th day of November, 2001
THINKPATH INC.
/S/ Xxxxx Xxxxxxxxx
By:________________________________
Xxxxx Xxxxxxxxx
Chief Financial Officer and Secretary
/S/ Declan French
By:________________________________
Xxxxxx X. French
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