Tucows Inc. filed SEC Form 8-K: Costs Associated with Exit or Disposal Activities, Leadership Update, Financial Statements and Exhibits

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Date of report (Date of earliest event reported): October 30, 2024

 

 

(Exact Name of Registrant Specified in Charter)

 

 

 

 

Registrant’s telephone number, including area code: (416) 535-0123

 

 

Not Applicable

 

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

 

 

 

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Securities registered pursuant to Section 12(b) of the Exchange Act:

 

 

 

 

On October 30, 2024, Tucows, Inc. (the “Company”) and its wholly-owned subsidiary, Ting Fiber, LLC ("Ting"), undertook a capital efficiency plan (the “Plan”) to reflect the ongoing operational and financial prioritizations of the Ting business and to lower the Company’s year-over-year operating expenses. The Plan is expected to impact approximately 42% of Ting's workforce and 17% of the Company’s total workforce.

 

The Company estimates that it will incur non-recurring charges of approximately $7.4 million in connection with the Plan, primarily consisting of severance payments, notice pay, employee benefits contributions and outplacement costs. The Company expects that the implementation of the headcount reductions and majority of the charges associated with the Plan and cash payments will be incurred in the fourth quarter of fiscal 2024.

 

Potential position eliminations are subject to legal requirements that vary by jurisdiction, which may extend this process beyond the fourth quarter of fiscal 2024 in certain cases. The charges that the Company expects to incur are subject to a number of assumptions, including legal requirements in various jurisdictions, and actual expenses may differ materially from the estimates disclosed above. The Company may also incur other charges or cash expenditures not currently contemplated in connection with the Plan.

 

 

 

 

Attendant to the Plan, Tucows is eliminating the Chief Operating Officer position and will be distributing the position’s functions within existing units in the organization. Accordingly, Michael Koenig, the Chief Operating Officer since October 31, 2022, has left the Company effective October 30, 2024.

 

 

 

 

 

 

This Current Report on Form 8-K contains “forward-looking” statements that are based on the Company’s beliefs and assumptions and on information currently available to the Company on the date of this Current Report on Form 8-K. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as “anticipate,” “believe,” “continue,” “could,” “design,” “estimate,” “expect,” “may,” “seek,” “should,” “will,” “would” or similar expressions and the negatives of those terms. Forward-looking statements may involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. These statements include, but are not limited to, the percentage of employee positions that will be affected; the estimate and timing of the charges that will be incurred; and the impact on the Company’s operating expense growth rate. Further information on factors that could cause the Company’s actual results to differ materially from the results anticipated by the Company’s forward-looking statements is included in the reports the Company has filed with the U.S. Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2023. Except as required by law, the Company does not have any obligation or intention to update these forward-looking statements or to update the reasons actual results may differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future.

 

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.