Exhibit 10.4
CONSULTING AGREEMENT
BETWEEN
1530266 ONTARIO LIMITED
AND
AVENUE RECONNECT INC.
MADE AS OF
May 31, 2005
TABLE OF CONTENTS
CONSULTING AGREEMENT
ARTICLE 1 - GENERAL..........................................................
1.01 Consultant Services..............................................
1.02 Term of Agreement................................................
ARTICLE 2 - REMUNERATION OF CONSULTANT.......................................
2.01 Fee for Services.................................................
2.02 Invoices.........................................................
ARTICLE 3 - COVENANTS OF CONSULTANT..........................................
3.01 Services.........................................................
3.02 Time of Services.................................................
3.03 Licences and Permits.............................................
3.04 Insurance........................................................
3.05 Indemnity........................................................
3.06 Non-disclosure...................................................
ARTICLE 4 - INDEPENDENT CONTRACTORS..........................................
4.01 Consultant not an Employee.......................................
4.02 Consultant shall not Contract on behalf of Corporation...........
ARTICLE 5 - TERMINATION......................................................
5.01 Termination by Corporation for Cause.............................
5.02 Termination by Corporation on Notice.............................
5.03 Provisions which Operate Following Termination...................
ARTICLE 6 - INTERPRETATION AND ENFORCEMENT...................................
6.01 Sections and Headings............................................
6.02 Extended Meanings................................................
6.03 Benefit of Agreement.............................................
6.04 Entire Agreement.................................................
6.05 Amendments and Waivers...........................................
6.06 Assignment.......................................................
6.07 Severability.....................................................
6.08 Notices..........................................................
6.09 Further Assurances...............................................
6.10 Governing Law....................................................
6.11 Attornment.......................................................
6.12 Copy of Agreement................................................
CONSULTING AGREEMENT
THIS AGREEMENT is made as of May 31, 2005
BETWEEN:
1530266 Ontario Limited, a corporation incorporated under the laws of
Ontario (the "Consultant"),
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Avenue Reconnect Inc., a corporation incorporated under the laws of
Ontario (the "Corporation").
WHEREAS Ronald W. Winney, Lance D. Peters, Damon W. Winney (collectively,
the "Vendors"), the Corporation, Teleplus Connect Corp. (the "Purchaser"), and
Teleplus Retail Services Inc. entered into a share purchase agreement dated
April 20, 2005 and amended as of May 31, 2005 (the Share Purchase Agreement");
AND WHEREAS pursuant to the terms of the Share Purchase Agreement, the
Vendors are required to cause the Consultant to enter into a consulting
agreement with the Corporation whereby, inter alia, the Consultant will provide
transitional assistance to the Corporation;
AND WHEREAS the execution and delivery of this Agreement is a condition
precedent to the obligation of the Purchaser to complete the transactions
contemplated in the Share Purchase Agreement;
AND WHEREAS capitalized terms used by not defined herein shall have the
meanings ascribed to such terms in the Share Purchase Agreement;
NOW THEREFORE for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE 1 - GENERAL
1.01 Consultant Services
Subject to the terms and conditions hereof, the Corporation shall retain
the Consultant to carry out services and the Consultant shall render the
following consultative services to the Corporation:
(a) make available to the Corporation during normal business hours that
portion of the premises located at 2569 Jefferson Boulevard,
Windsor, Ontario (the "Premises") that will be necessary to operate
the Business,
(b) provide the services of the Consultant's employees to the
Corporation as is necessary to operate the Business during normal
business hours, which shall include (i) the services of no less than
two (2) key employees of Consultant (each a "Key Employee") for a
period of up to eight hours per day, and (ii) the services of Damon
Winney for a period of four hours per day,
(c) to take all such action and do or cause to be done all such things
as shall, in the opinion of the Purchaser, acting reasonably, be
necessary or proper in order that the obligations of the Corporation
may be performed in such manner that the value of the Contracts
shall be preserved and shall enure to the benefit of the
Corporation, and
(d) collect all moneys due and payable to the Corporation in and under
the Contracts and deliver the same to the Corporation immediately
upon receipt,
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and such other consultative services as may from time to time be agreed upon
between the parties.
1.02 Term of Agreement
The provision of services by the Consultant to the Corporation hereunder
shall commence on May 31, 2005 and shall continue for a period of up to six (6)
months from such date or such later date as the parties hereto may agree.
ARTICLE 2 - REMUNERATION OF CONSULTANT
2.01 Fee for Services
The Corporation shall pay to the Consultant for the services provided
under this Agreement a fee at the rate of:
- $15 per hour for the services of each Key Employee, and
- $50 per hour for the services of Damon Winney.
The cost to the Corporation for the use of the Premises as stipulated in
Section 1.01(a) above is included in the fees paid to the Key Employees and
Damon Winney.
2.02 Invoices
Payment shall be made to the Consultant with respect to the services and
expenses referred to in Section 2.01 within 15 days from receipt by the
Corporation of proper invoices and vouchers together with a satisfactory
progress report in respect of such services and expenses, all of which shall be
submitted by the Consultant to the Corporation on the 15th and the last day of
each month during the term of this Agreement.
ARTICLE 3 - COVENANTS OF CONSULTANT
3.01 Services
The Consultant shall render performance of the services hereunder to the
best of the Consultant's ability and in a competent and professional manner.
3.02 Time of Services
The Consultant shall devote such of his time and attention to the Business
of the Corporation as stipulated herein and as may be agreed to by the
Consultant and the Corporation. The time of service to be provided hereunder by
the Consultant shall be as agreed to from time to time by the Corporation and
the Consultant.
3.03 Licences and Permits
The Consultant shall be responsible for obtaining all necessary licences
and permits and for complying with all applicable federal, provincial and
municipal laws, codes and regulations in connection with the provision of the
services hereunder and the Consultant shall when requested provide the
Corporation with adequate evidence of his compliance with this Section 3.03.
3.04 Insurance
The Consultant shall pay for and maintain for the benefit of the
Consultant and the Corporation, with insurers or through the appropriate
government department and in an amount and in a form acceptable to the
Corporation, appropriate insurance concerning the operations and liabilities of
the Consultant relevant to this Agreement including, without limiting the
generality of the foregoing, workers' compensation and unemployment insurance in
conformity with applicable statutory requirements in respect of any remuneration
payable by the Consultant to any employees of the Consultant and public
liability and property damage insurance.
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3.05 Indemnity
The Consultant shall indemnify and save the Corporation harmless from and
against all claims, actions, losses, expenses, costs or damages of every nature
and kind whatsoever which the Corporation or its officers, employees or agents
may suffer as a result of the negligence of the Consultant in the performance or
non-performance of this Agreement.
3.06 Non-disclosure
(1) The Consultant shall not (either during the term of this Agreement or
at any time thereafter) disclose any information relating to the private or
confidential affairs of the Corporation or relating to any secrets of the
Corporation to any person other than for the Corporation's purposes and shall
not (either during the term of this Agreement or at any time thereafter) use for
his own purposes or for any purposes other than those of the Corporation any
such information or secrets he may have or acquire in relation to the Business.
(2) The Consultant shall obtain a written non-disclosure agreement in a
form acceptable to the Corporation in respect of the same information and
secrets referred to in Section 3.06(1) from all persons, including but not
limited to any employees of the Consultant, who are in any way involved with the
Consultant in the provision of consultative services to the Corporation
hereunder and in the course thereof may have access to any information or
secrets referred to in Section 3.06(1) and the Consultant shall provide the
Corporation with executed copies of any such non-disclosure agreement.
ARTICLE 4 - INDEPENDENT CONTRACTORS
4.01 Consultant not an Employee
Neither the Consultant nor its employees, including the Key Employees and
Damon Winney, is an employee of the Corporation and neither the Consultant nor
its employees shall be entitled to receive from the Corporation any benefits
whatsoever and the Corporation shall not be required to make contributions for
unemployment insurance, Canada Pension, workers' compensation and other similar
levies in respect of the fee for services to be paid to the Consultant pursuant
to Section 2.01.
4.02 Consultant shall not Contract on behalf of Corporation
The Consultant shall not, without the prior written consent of the
Corporation, enter into any contract or commitment in the name of or on behalf
of the Corporation or bind the Corporation in any respect whatsoever.
ARTICLE 5 - TERMINATION
5.01 Termination by Corporation for Cause
The Corporation may terminate this Agreement at any time in the event of
the failure of the Consultant to comply with any of the provisions hereunder
upon the Consultant being notified in writing by the Corporation and failing to
remedy such failure within 3 days of receiving such notice.
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5.02 Termination by Corporation on Notice
The Corporation may terminate this Agreement upon the giving of 10 days
written notice to the Consultant.
5.03 Provisions which Operate Following Termination
Notwithstanding any termination of this Agreement for any reason
whatsoever and with or without cause, the provisions of Sections 3.05 and 3.06
and any other provisions of this Agreement necessary to give efficacy thereto
shall continue in full force and effect following any such termination.
ARTICLE 6 - INTERPRETATION AND ENFORCEMENT
6.01 Sections and Headings
The division of this Agreement into Articles and Sections and the
insertion of headings are for the convenience of reference only and shall not
affect the construction or interpretation of this Agreement. The terms "this
Agreement", "hereof", "hereunder" and similar expressions refer to this
Agreement and not to any particular Article, Section or other portion hereof and
include any agreement or instrument supplemental or ancillary hereto. Unless
something in the subject matter or context is inconsistent therewith, references
herein to Articles and Sections are to Articles and Sections of this Agreement.
6.02 Extended Meanings
In this Agreement words importing the singular number only include the
plural and vice versa, words importing any gender include all genders and words
importing persons include individuals, partnerships, associations, trusts,
unincorporated organizations and corporations and vice versa.
6.03 Benefit of Agreement
This Agreement shall enure to the benefit of and be binding upon the
heirs, executors, administrators and legal personal representatives of the
Consultant and the successors and assigns of the Corporation respectively.
6.04 Entire Agreement
This Agreement constitutes the entire agreement between the parties with
respect to the subject matter hereof and cancels and supersedes any prior
understandings and agreements between the parties hereto with respect thereto.
There are no representations, warranties, forms, conditions, undertakings or
collateral agreements, express implied or statutory between the parties other
than as expressly set forth in this Agreement.
6.05 Amendments and Waivers
No amendment to this Agreement shall be valid or binding unless set forth
in writing and duly executed by both of the parties hereto. No waiver of any
breach of any term or provision of this Agreement shall be effective or binding
unless made in writing and signed by the party purporting to give the same and,
unless otherwise provided in the written waiver, shall be limited to the
specific breach waived.
6.06 Assignment
Consultant may not assign its rights or obligations under this Agreement
without the prior written consent of the Corporation. The Corporation may assign
its rights and obligations under this Agreement to the Purchaser or to such
other assignee as it may elect in its discretion.
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6.07 Severability
If any provision of this Agreement is determined to be invalid or
unenforceable in whole or in part, such invalidity or unenforceability shall
attach only to such provision or part thereof and the remaining part of such
provision and all other provisions hereof shall continue in full force and
effect.
6.08 Notices
Any demand, notice or other communication to be made or given in
connection with this Agreement shall be made or given in writing and may be made
or given by personal delivery or by registered mail addressed to the recipient
as follows:
To the Consultant:
2569 Jefferson Boulevard
Windsor, Ontario
N8T 2W5
Telecopier: (519) 948-0847
Attention: President
To the Corporation:
Avenue Reconnect Inc.
c/o Wildeboer Dellelce LLP
1 First Canadian Place
Suite 810
Toronto, Ontario M5X 1A9
Attention: President
or such other address or individual as may be designated by notice by either
party to the other. Any demand, notice or other communication made or given by
personal delivery shall be conclusively deemed to have been given on the day of
actual delivery thereof and, if made or given by registered mail, on the 3rd
day, other than a Saturday, Sunday or statutory holiday in Ontario, following
the deposit thereof in the mail. If the party giving any demand, notice or other
communication knows or ought reasonably to know of any difficulties with the
postal system which might affect the delivery of the mail, any such demand,
notice or other communication shall not be mailed but shall be made or given by
personal delivery.
6.09 Further Assurances
Each party must from time to time execute and deliver all such further
documents and instruments and do all acts and things as the other party may
reasonably require to effectively carry out or better evidence or perfect the
full intent and meaning of this Agreement.
6.10 Governing Law
This Agreement shall be governed by and construed in accordance with the
laws of the Province of Ontario and the laws of Canada applicable therein.
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6.11 Attornment
For the purpose of all legal proceedings this Agreement shall be deemed to
have been performed in the Province of Ontario and the courts of the Province of
Ontario shall have jurisdiction to entertain any action arising under this
Agreement. The Corporation and the Consultant each hereby attorns to the
jurisdiction of the courts of the Province of Ontario provided that nothing
herein contained shall prevent the Corporation from proceeding at its election
against the Consultant in the courts of any other province or country.
6.12 Copy of Agreement
The Consultant hereby acknowledges receipt of a copy of this Agreement
duly signed by the Corporation.
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IN WITNESS WHEREOF the parties have executed this Agreement on the date
first written above.
AVENUE RECONNECT INC.
Per: /s/ Marius Silvasan
------------------------------------
Authorized Signing Officer
1530266 ONTARIO LIMITED
Per: /s/ Ronald W. Winney
------------------------------------
Authorized Signing Officer