Exhibit 10.1
CONSULTING AGREEMENT
THIS AGREEMENT IS MADE as of the 17th day of March, 2015.
BETWEEN:
PAPERNUTS CORPORATION,
a company incorporated under the laws
of the Province of Ontario, Canada
(hereinafter called the "Company")
- and -
DON GIROTTI
an individual resident at 2 Lantana Circle, St. Catherines, Ontario, L2M 7M5,
(hereinafter called the "Consultant")
WHEREAS the Company wishes to engage the Consultant to provide to the Company those Consulting Services and otherwise perform the duties and responsibilities as set out in the Schedule “A” of this Consulting Agreement and the Consultant agrees to accept that engagement;
AND WHEREAS the Consultant is committed to providing those consulting services in a professional and competent manner, and to act in the best interests of the Company while providing them;
WHEREFORE IT IS HEREBY AGREED AS FOLLOWS:
1. DEFINITIONS
1.1 In this Agreement the following terms shall have the following meanings:
(a) "Affiliate" means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or under common control with that other Person. For the purposes of this definition, a Person “controls” another person if that Person directly or indirectly possesses the power to direct or cause the direction of the management or policies of that other Person, whether through the ownership of securities, by contract or otherwise;
(b) "Agreement" means this agreement including the recital and the schedule attached hereto which are hereby made a part hereof, as it may be amended or supplemented from time to time; and the expressions "hereof", "herein", "hereto",
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"hereunder", "hereby" and similar expressions refer to this agreement and unless otherwise indicated, references to "Sections" or "paragraphs" are references to sections or paragraphs in this Agreement;
(c) "Common Shares" means the shares of the Company which are entitled to one vote per share at any meeting of the shareholders of the Company;
(d) "Confidential Information" means information of a sensitive nature related to the Company or its Affiliates, or their respective businesses, which is not in the Public Domain. Confidential Information does not include any information that:
(i) is within the Public Domain at the date of its disclosure to the receiving party, or subsequently enters the Public Domain (but only after it enters the Public Domain) through no fault of the Consultant;
(ii) is independently developed by or on behalf of the Consultant as shown by documentary evidence;
(iii) is disclosed to the Consultant by a third party not having an obligation of confidence to the proprietor of the information as shown by the documentary evidence;
(iv) is required to be disclosed by a court or government agency or is permitted to be disclosed with the prior written consent of the Company; or
(v) is Residual Information.
No combination of information shall be deemed to be within any of the above exceptions, whether or not the component parts of the combination are within one or more of the exceptions set out above, unless the combination itself and its economic value and principles of operation are themselves so excepted;
(e) "Consulting Services" means those services to be provided by the Consultant to the Company during the term of this Agreement, as more particularly set forth and described in the Schedule “A” attached hereto;
(f) "Company" means Papernuts Corporation, an Ontario registered company;
(g) "Event of Default" means: (i) a material failure of the Consultant to properly perform the Consulting Services or any other material breach of the terms and conditions of this Agreement which, in either case, is not capable of remedy or, if it is capable of remedy, has not been remedied within 30 days of the Consultant receiving written notice thereof from the Company, or if the nature of the default is such that it is not reasonably possible to comply within 30 days, the consultant has not begun and is not working diligently to comply within 30 days (ii) the bankruptcy, insolvency or appointment of a receiver or other steps taken in furtherance thereof with respect to the Consultant;
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(h) "Notice" means any written statement, payment, account, notice, election, direction or other writing required or permitted to be given hereunder;
(i) "Intellectual Property" includes proprietary rights under (i) patent law, (ii) copyright law, (iii) trademark law, (iv) design patent or industrial design law, (v) semi-conductor chip or mask work law, or (vi) any other statutory provision or common law principle which provides a right in either (a) ideas, formulae, algorithms, concepts, inventions or know-how generally, including trade secret law, or (b) the expression or use of such ideas, formulae, algorithms, concepts, inventions or know-how;
(j) "Person" means any individual, partnership, limited partnership, joint venture, syndicate, sole proprietorship, company or corporation with or without share capital, unincorporated association, trust, trustee, executor, administrator or other legal personal representative, regulatory body or agency, government or governmental agency, authority or entity however designated or constituted;
(k) "Public Domain" means readily accessible to the public in a written publication, and does not include information that is only available by substantial searching of the published literature, and information the substance of which must be pieced together from a number of different publications and/or sources;
(l) "Residual Information" means general information not specified as being confidential in nature by the Company that is in tangible form and is retained in the memory of any of the Consultant’s agents, employees or representatives who have had access to Confidential Information including ideas, concepts, know-how and techniques or business opportunities that have been considered by the Company but rejected or unsuccessfully pursued by the Company;
(m) "Work of Authorship" includes books, computer programs, drawings, notes, reports, other documents and materials; magnetic, electronic, sound, or video recordings; and photographs or cinematographic films or any other work in which copyright or any right of a similar nature may subsist.
2. TERM OF ENGAGEMENT
2.1 The Company engages the Consultant to provide and the Consultant will provide the Consulting Services by means of the personal performance of the same by the Consultant with effect from the date of this Agreement on a continuing basis unless and until terminated at any time by the Company giving to the Consultant no less than two (2 months) prior written notice.
2.2 The Consultant may forthwith terminate this Agreement by providing fifteen (15) days written notice to the Company.
2.3 The Company agrees that the Consulting Services shall, unless otherwise mutually agreed between the parties, be performed by the Consultant in accordance with the provisions of Section 4.
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3. INDEPENDENT CONTRACTOR
3.1 The parties to this Agreement are independent businesses and it is intended that both parties shall retain their independence. The Consultant shall be and shall act solely as an independent Consultant in the performance of its duties and responsibilities under this Agreement. Nothing contained in this Agreement or in the relationship of the Company and the Consultant shall be regarded or construed as creating any relationship (employer/employee, joint venture, association, or partnership) between the parties other than as expressly set forth herein.
3.2 The parties further agree that the Consultant is not authorized to assume or to create any obligation of any kind, express or implied, on behalf of the Company or to bind the Company in any respect whatsoever, unless otherwise expressly authorized to do so by the Company.
3.3 Subject to the Consultant's performance of its obligations under Section 4 below the Consultant shall be free to devote to the Consultant's consulting business such portion of the Consultant's time, energy, efforts and skill as the Consultant sees fit.
4. CONSULTANT'S SERVICES
4.1 The Consultant shall provide the Consulting Services, plus such further and other services as may be requested by the Company and agreed to be provided by the Consultant from time to time.
4.2 The Consultant shall keep and submit to the Company accurate records of all time spent in the performance of Consulting Services for and on behalf of the Company showing such detail as the Company and the Consultant shall from time to time agree.
4.3 The Consultant shall devote its best efforts to the performance of the Consulting Services and to such other services as may be reasonably requested by the Company and hereby agrees to provide the Consulting Services to the Company for a maximum of two hundred and twenty (220) days per year. However, the parties acknowledge that the actual period will be flexible.
4.4 The Consultant shall ensure that it possesses a sufficient working knowledge of the Company's activities, and products, as necessary to fulfill the Consultant's obligations hereunder.
4.5 The Consultant shall ensure that it and its agents, employees and representatives comply with all policies, practices, laws and regulations applicable at the premises or facilities at which the Consulting Services are to be performed.
4.6 The Consultant agrees that it:
(a) is solely responsible for the calculation, withholding and remittance of all taxes and other statutory deductions and withholdings that may be required in connection with, or arising from, the Consulting Services performed under this
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Agreement, including, without limitation, any income taxes, Employment Insurance contributions, Canada Pension Plan contributions, HST remittances, workers’ compensation premiums, Employer Health Tax, and any other taxes, amounts or other expenses; and
(b) will indemnify and hold the Company harmless from any and all claims, liabilities, damages, taxes, fines, penalties or interest sought and recovered from any governmental entity arising from the failure of the Consultant or the Company to deduct or remit any amounts owing with respect to any required taxes, statutory deductions or other withholdings as set out in paragraph 4.6(a) above in connection with the Consulting Services performed under this Agreement.
4.7 The Consultant acknowledges and agrees that it will be required to provide the Consulting Services at the following geographical locations: North America, and elsewhere as required by the Company's business with the mutual agreement of both parties.
5. CONSULTING FEES AND EXPENSES
5.1 The Company agrees that:
(a) it shall pay the Consultant, in full satisfaction of the Consultant’s Consulting Services, a fee of $80.00 per hour for labour and the Consultant’s cost plus 15% for parts that the Consultant provides with respect to the Consulting Services to the Company, payable monthly within thirty (30) days after receipt of the invoice from the Consultant covering the Consulting Services rendered as consulting fees for the Consultant's services pursuant to this Agreement (the “Consulting Fees”). The Company may, at its sole and absolute discretion, elect to pay the Consulting Fee, in part or in whole, through the issuance of common shares of its parent company, Axiom Corp., at the fair market value of such common shares to be issued as directed by the Consultant; and
(b) it shall purchase from the Consultant the first one thousand (1000) industrial Papernut machinesper job #29082 at a price to be determined by the Consultant and the Company acting in good faith and after testing and approval of the prototype to be agreed upon by the Consultant and the Company.
5.2 The Consultant agrees to render a monthly invoice to the Company, in a form acceptable to the Company, for the Consulting Services provided in that month, along with any reasonable and pre-approved expenses incurred by the Consultant while providing the Consulting Services. The Consultant also agrees to supply its HST registration number to the Company.
5.3 The Company shall also reimburse the Consultant for any reasonable out-of-pocket expenses incurred by the Consultant at the request of the Company. Prior to the reimbursement of such expenses, the Company shall require the Consultant to prepare a detailed summary of the expenses incurred and submit it to the Company together with
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appropriate supporting receipts, invoices, and other documentation showing such information as the Company and Consultant shall from time to time agree.
The Company may make an advance to the Consultant to cover such expenses, provided that: (i) the Consultant shall subsequently provide a detailed summary of the expenses incurred (with supporting receipts) to account for the advance, and (ii) the Consultant specifically acknowledges to repay the balance of any outstanding advance immediately upon the termination of this Agreement (irrespective of how such termination is caused), and that this repayment obligation shall constitute a debt owing by the Consultant to the Company.
6. CONFIDENTIAL INFORMATION AND PROPERTY OF THE COMPANY
6.1 The Consultant's Obligations as to Confidential Information and Materials. Confidential Information, whether in written, oral, magnetic, photographic, optical, or other form and whether now existing or developed or created during the period of the Consultant's relationship or engagement with the Company, excepting information obtained from general or public sources, is proprietary to the Company and is highly confidential in nature.
In this regard, the Consultant acknowledges that any breach of its obligations under Section 6 will cause irreparable harm to the Company for which damages cannot be reasonably calculated. Accordingly, in the event that the Consultant breaches its obligations under Section 6, the Consultant agrees that the Company shall be entitled to obtain injunctive relief restraining any further breach without proof of actual damages or the requirement to establish the adequacy of any other remedies available to it. In addition to injunctive relief, the Company shall also be entitled to pursue a claim for damages or any other remedies available to it in law or in equity.
6.2 General Skills. The general skills and Residual Information and other experience gained by the Consultant during the Consultant's relationship with the Company, and information publicly available or generally known within the industries or trades in which the Company competes, is not considered Confidential Information.
6.3 Preservation of Confidential Information. During the Consultant's relationship with the Company, the Consultant may have access to all or a portion of the Confidential Information and, as such, the Consultant will occupy a position of trust and confidence with respect to the Company's affairs and business. The Consultant will take the following steps to preserve the confidential and proprietary nature of the Confidential Information:
(a) Non-Disclosure. The Consultant will not at any time disclose to any Person or otherwise permit any Person to access any Confidential Information, except with the prior written consent of the Company or as specifically required in the performance of the Consultant's duties to the Company.
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(b) Prevent Disclosure. The Consultant will take all reasonable precautions to prevent disclosure of any Confidential Information and will follow all the Company's reasonable instructions to the Consultant in respect of the same.
(c) Non-Use. The Consultant will not use, or otherwise permit any Person to use, any of the Confidential Information at any time, except with the prior written consent of the Company or as specifically required in the performance of the Consultant's duties to the Company.
(d) Return all Materials. Upon termination of the Consultant's relationship with the Company, for any reason whatsoever, the Consultant will deliver to the Company all copies of the Confidential Information, including, without limitation, any documentation, records, listings, notes, data, sketches, drawings, memoranda, models, accounts, reference materials, samples, machine-readable media and equipment which in any way relate to the Confidential Information, without retaining any copies.
6.4 Continuation of Confidentiality Obligations. The Consultant acknowledges and agrees that the obligations set out in this Section survive the termination of this Agreement for any reason. The Consultant further acknowledges that the obligations set out in this Section are not in substitution for any obligations which the Consultant may now or hereafter owe to the Company and which exist apart from this Agreement and do not replace any rights of the Company with respect to any such obligations.
6.5 Communication of Confidential Information. The Consultant agrees to communicate to the Company all Confidential Information obtained in the course of performing the Consulting Services.
7. INTELLECTUAL PROPERTY OF THE COMPANY
7.1 Copyright and Ownership. The Consultant agrees that any and all rights, title, and interest in or to any and all of the products, work product, Works of Authorship, Intellectual Property or materials produced by the Consultant or by its personnel while providing the Consulting Services shall be the exclusive property of the Company. For greater certainty, the Company shall have all proprietary interests in everything that Consultant and its employees and permitted sub-contractors, alone or with others, create or do for the Company including inventions, designs, computer programs (and related documentation and materials), Intellectual Property and Works of Authorship (which are collectively referred to herein as “Developments”). Consultant agrees to and does hereby expressly and irrevocably assign and cause to be assigned in favour of the Company all copyright, rights to inventions, patents, trade secrets or other Intellectual Property which Consultant and its employees and permitted sub-contractors may enjoy in the Developments. Without limitation, all working papers, notes and memoranda which are made or obtained by Consultant and its employees and permitted sub-contractors in the course of this Agreement shall be the property of the Company and will accordingly be provided to the Company upon termination of this Agreement.
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7.2 Moral Rights. No work produced by the Consultant shall be deemed to fall within any other classification, which would result in ownership rights of any description concerning such materials or work vesting in the Consultant. In the event any ownership rights in the Developments are deemed to vest in the Consultant, the Consultant waives all moral rights related to such Developments and the Consultant agrees that the Company may modify and use such work as it sees fit. The Consultant agrees that any Developments produced in the course of performing the Consulting Services under this Agreement shall not be the subject of an application for copyright, or patent by or on behalf of the Consultant and that the Consultant shall co-operate with the Company in any application for copyright or patent it deems appropriate concerning any Developments.
7.3 Assignment of Title.Consultant agrees that on the Company’s request, Consultant shall promptly execute a specific assignment of title to the Company or its designee, and do anything else reasonably necessary to enable the Company or its designee to secure patent, copyright or other form of intellectual property or trade secret interest protection for the Developments in Canada and in all other countries.
7.4 Exclusion. The Consultant acknowledges that there are no ideas, processes, trademarks, service marks, technology, computer programs, Intellectual Property, Works of Authorship (original or otherwise), designs, formulas, inventions, discoveries, patents, copyrights, or improvements to the foregoing which fall within the provisions of section 7.2 that it desires to exclude from the operation of this Agreement. To the best of the Consultant's knowledge, it is not a party to any existing contract in conflict with this Agreement or any other contract to assign ideas, processes, trademarks, service marks, inventions, technology, computer programs, Works of Authorship (original or otherwise), designs, formulas, discoveries, patents, Intellectual Property or copyrights to any other Person.
7.5 Disclosure. The Consultant agrees to promptly disclose to the Company all of its Work of Authorship and Intellectual Property and hereby agrees to execute all documents or do all other acts necessary in order to enable the Company to preserve and protect its rights in the Developments. Regardless of whether this Agreement has been terminated, the Consultant agrees to execute, acknowledge, and deliver any instruments, and to provide whatever other assistance is required to confirm the ownership by the Company of such rights in the Developments. Reasonable expenses incurred for such assistance shall be paid by the Company. No additional compensation shall be paid to the Consultant in respect of any of the matters referred to in this clause.
7.6 No Rights. Nothing in this Agreement shall be construed to grant to the Consultant any express or implied option, license or other rights, title or interest in or to the Confidential Information of the Developments, or obligate either party to enter into any agreement granting any such right. If the Consultant acquires any right, title or interest in any Confidential Information or any Developments, the Consultant hereby irrevocably assigns all such rights, title and interests exclusively to the Company.
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8. TERMINATION
8.1 By the Consultant. If the Consultant serves notice to terminate this Agreement pursuant to paragraph 2.2, the Company shall have the option, in its complete discretion, to waive all or part of the required notice period and immediately terminate this Agreement. In the event that the Company exercises its option to waive all or part of the required notice period, the Company shall only be liable to the Consultant for any consulting fees and expenses owing for the period up to, and including, the effective date of termination. The Consultant expressly agrees that the Company shall have no further or other obligations to it, other than as specifically provided by this paragraph.
8.2 By the Company. The Company may terminate this Agreement:
(a) immediately in the event of the Consultant committing or being subject to an Event of Default; or
(b) by providing the written notice (or the equivalent consulting fees owing in lieu of such notice) as required by paragraph 2.1.
The Consultant hereby agrees to accept the notice or payments (if any) prescribed by this paragraph in full and final satisfaction of the Company’s obligations to the Consultant arising from the termination of this Agreement. Upon providing the notice or payments (if any) required by this paragraph, the Consultant specifically acknowledges and agrees that the Company has no further or other obligations to it.
9. NOTICE
9.1 Unless otherwise permitted by this Agreement, all notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been fully given if delivered: (i) personally to the party to whom the notice or other communication is directed, (ii) by facsimile transmission with an acknowledgement received at the number set out below, or (iii) by prepaid registered mail on the fifth business day after the date on which it is so mailed (provided that if there is an interruption in the regular postal service during such period arising out if a strike, lockout, work slow-down or similar labour dispute in the postal system, all days during which such interruption occurs shall not be counted) to the following address:
Notice to the Company:
Tyler Pearson
Papernuts Corporation
380 Vansickle Road, Unit 600
St. Catherines, Ontario
L2S 0B5
Attention: President
Facsimile: (289) 273-2099
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Notice to the Consultant:
Don Girotti
26 Seapark Drive
St. Catherines, Ontario, L2M 6S6
Facsimile: (905) 684-8825
Either party may change its address for service from time to time by providing written notice to the other party in accordance with this section.
10. GOVERNING LAW
10.1 The parties agree that this Agreement shall be governed by, and interpreted in accordance with, the laws of the Province of Ontario, Canada. Each of the Company and the Consultant irrevocably attorns to the exclusive jurisdiction of the courts of the Province of Ontario in connection with any dispute, claim or proceeding arising under this Agreement or the Consultant’s performance of the Consulting Services.
11. MISCELLANEOUS
11.1 This Agreement contains the entire understanding and agreement between the parties with respect to the Consulting Services to be provided by the Consultant.
11.2 The rights and obligations of the parties set out under Sections 6, 7, and 11 of this Agreement survive the termination of this Agreement insofar as is necessary to give full effect to the terms hereof.
11.3 This Agreement shall be assignable by the Company to any third-party, but not by the Consultant without the express written consent of the Company.
11.4 Any changes or amendments to this Agreement must be expressly approved in writing by both parties hereto.
11.5 In the event that any provision in this Agreement is determined by a court of competent jurisdiction to be void or unenforceable in whole or in part, it shall be deemed to be severed from this Agreement. However, any such determination will not impair or affect the validity or enforceability of any other covenant or provision contained in this Agreement, and this Agreement shall be construed as though such invalid or unenforceable provision were omitted.
11.6 Each of the Company and the Consultant agree that they had the opportunity to obtain, or did obtain, independent legal advice prior to executing this Agreement. Both parties acknowledge and agree that the terms of this Agreement are fair and reasonable.
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IN WITNESS WHEREOF the parties have executed this Agreement with effect from the date first written above.
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| PAPERNUTS CORPORATION | |||
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/s/Tyler Pearson | ||
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| Authorized Signatory Tyler Pearson CEO
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Witness |
| /s/ Don Girotti Don Girotti | ||||
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SCHEDULE “A”
Duties of the Consultant
The Consultant shall provide consulting, design, manufacturing, assembly and testing services to the Company with respect to the Company’s machines and business at the remuneration as provided for in this Agreement.
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