Appendix A: Statement of Work (SOW)

1.

Term

2.

Positive Responsibilities

Assign Positive Venture Hub (Hub) to You to provide Outsourced Finance Services to CurAegis Technologies Inc. The Hub shall work with You to deliver the following services:

2.1.1.

Transition Services:

2.1.1.1.

Situation Assessment (half day);

2.1.1.2.

Set-up on NetSuite “▇▇▇▇ LE – SmallBiz OneWorld”, Pricing Category 3 (less than $20,000,000,00 USD Revenue), including:

2.1.1.2.1.

Two (2) Client Restricted NetSuite User(s);

2.1.1.2.1.1.

Should You require additional NetSuite Users, there will be an added cost of $100 per user to the Charges outlined below, as preapproved by You.

2.1.1.2.2.

Standard Industry Chart of Accounts | Accounts Payable | Accounts Receivable; and

2.1.1.2.3.

Bank Accounts | Organizations | Income Statement and Balance Sheet Reporting.

2.1.1.3.

Data Migration:

2.1.1.3.1.

Vendors | Customers | AR and AP Balances;

2.1.1.3.2.

Trial Balance Uploads for current fiscal year (monthly intervals) | Prepaid and Accrual Items | Deferred Revenue Balances; (no transactional data uploads are included currently)

2.1.1.3.3.

Other liability and equity balances; and

2.1.1.3.4.

Please note this SOW is for one [1] Legal Entities.

2.1.1.4.

Connections and Integrations:

2.1.1.4.1.

Expensify integration for up to 15 users

2.1.1.4.2.

Note, the services outlined in this SOW 01 do not include any additional integrations or connectors other than those outlined above. Should CurAegis Technologies Inc. identify the need for additional integrations or connectors during the term of this SOW, an Amendment will be created to reflect the costs associated, as mutually agreed between You and Positive.

2.1.2.

Monthly Outsourced Finance Services:

2.1.2.1.

Accounts Receivable Processing;

2.1.2.2.

Accounts Payable Processing;

2.1.2.3.

Payroll Administration Processing;

2.1.2.4.

Cash Management Processes;

2.1.2.4.1.

Including Week/ bi-weekly | Cash Flow review

2.1.2.5.

Harmonized Sales Tax and other regulatory filings;

2.1.2.6.

Month-end Accounting Process; and

2.1.2.7.

Standard monthly Financial Reporting and Review (Income Statement and Balance Sheet).

3.

Completion Criteria

3.1.

Completion of Transition Services;

3.1.1.

Trial Balance data uploaded to system for current and previous fiscal year only (additional years is not in scope).

3.2.

Initiation of a Monthly Outsourced Finance Services;

3.3.

Monthly Review of Financial Statements; Monthly close completed business Day 15;

3.4.

Completion of Quarterly Close; Quarter close completed by business Day 15;

3.5.

Completion of Annual Close.

4.

Deliverables and Materials

4.1.

Initial transition and setup;

4.2.

Annual Unaudited Financial Statements;

4.3.

Accurate and Timely Payroll records;

4.4.

Accurate Accounts Receivable and Accounts Payable Documentation;

4.5.

Accurate and timely HST Tax Filings;

4.6.

Monthly and quarterly financial statements; and

4.7.

Annual Service Review conducted 60 days before Contract Renewal Term.

5.

Positive Responsibilities

5.1.

Positive will assign “You” a CFO to provide C-Level Financial Advisory Services to CurAegis Technologies Inc. The CFO shall work with CurAegis Technologies Inc.’s Management to:

5.1.1.

Perform a situation assessment (needs, wants, priorities) of CurAegis Technologies Inc. related to the Services Positive can provide.

5.1.2.

Establish and enhance the cash flow forecast reporting and processes.

5.1.3.

Strengthen and support the financial accounting and reporting processes.

5.1.4.

Augment strategic plan and associated processes (5-year plan, remodeled quarterly).

5.1.5.

Establish or augment Board governance and meeting cadence.

5.1.6.

Establish or augment Management cadence and goal setting.

5.1.7.

Support financing and funding (grants) activities and inorganic transactions (▇.▇. ▇&▇).

5.1.8.

Identify and execute other value-add introductions and activities beneficial to You.

5.1.9.

Act as a virtual CFO including:

5.1.9.1.

Participate in the management cadence including sales and Executive meetings.

5.1.9.2.

Participate in the reporting and meeting cadence for investors and the Board of Directors.

5.1.9.3.

Support monthly, quarterly and annual financial statement and reporting preparation and interface with external Auditors/Accountants.

5.1.9.4.

Support monthly finance operations, including billing, collections, payments, payroll and banking and cash flow management activities.

5.1.9.5.

Support strategic and annual planning processes.

5.1.9.6.

Support compensation planning and structures.

5.1.9.7.

Participate in the management activities as necessary including meeting with customers, meeting with investors, supplier management, review of contracts, review of accounting conclusions, policies and procedures etc.

5.1.9.8.

Support annual tax and payroll filing compliance, including Scientific Research and Experimental Development (SRED) Claims.

5.1.9.9.

Support tax planning with the CEO and Advisors.

5.1.10.

Act as a support for the CEO on financial and other matters.

5.1.11.

Other general participation on the management team.

5.1.12.

Act as an interface with the Board to ensure appropriate governance processes are in place.

6.

Completion Criteria

6.1.

Completion of a situation assessment for You, including a list of recommended priorities.

6.2.

Establishment of a cash flow report and process.

6.3.

Completion of monthly, quarterly and annual financial statements and associated Audit/Review.

6.3.1.

Including deliverables and/or work effort related to SEC and Regulatory reporting (ex. 10Q, 10K, etc.)

6.4.

Deliver an annual budget and long-term (5-year) strategic plan, and associated Key Performance Indicator (KPI) metrics, as required.

6.5.

Support the creation of investor presentations to support financings, as required.

6.6.

Support the preparation and submissions of grant applications for non-dilutive financing, as required.

6.7.

Support the preparation of a Calendar Wheel for Board and Committees (e.g. Audit, Compensation).

6.8.

Provide recommendations on the management cadence and support associated meetings.

6.9.

Support the completion of Fiscal tax and payroll filings, including SRED Claims. Please note, this does not include Corporate Tax Filings.

7.

Deliverable Materials

7.1.

Situation assessment.

7.2.

Cash flow forecast.

7.3.

Monthly, quarterly and annual financial statements

7.4.

Annual budget and associated Company/management KPIs.

7.5.

Long-term (5-year) strategic plan financial report.

7.6.

Investor presentations to support financing.

7.7.

Grant materials.

7.8.

Support annual tax and payroll filings.

7.8.1.

Please note, this does not include the full preparation of complete Corporate Tax Filings, foreign tax filings or provincial, state or local excise tax filings outside the province of Ontario, which will generally be handled by a third party tax advisor as facilitated by You or Positive.

7.8.2.

Documented recommendations on operational processes.

8.

Positive Responsibilities

8.1.

Positive will assign “You” a member of the Financial Planning & Analysis team to provide FP & A Services to CurAegis Technologies Inc. The FP&A team shall work with CurAegis Technologies Inc.’s Management to:

8.1.1.

Perform a situation assessment (needs, wants, priorities) of CurAegis Technologies Inc. related to the FP&A Services Positive can provide.

8.1.2.

Establish or enhance business model:

8.1.2.1.

Monthly reporting and forecast updates.

8.1.2.2.

Support for KPI reporting.

8.1.2.3.

Quarterly rolling plans.

8.1.2.4.

Annual Budgets and monthly-year plans.

9.

Completion Criteria

9.1.

FP&A Service activities:

9.1.1.

Provide monthly forecast and reporting package.

9.1.2.

Support quarterly rolling plans.

9.1.3.

Provide annual budget.

10.

Deliverable Materials

10.1.

FP&A deliverables:

10.1.1.

Business Model.

10.1.2.

Forecast and reports.

10.1.3.

Quarterly rolling plan.

10.1.4.

Annual budget.

11.

Outsourced Finance Scope and Specifications

11.1.

Process Areas in Scope

11.1.1.

Record to Report – General ▇▇▇▇▇▇;

11.1.2.

Design to Build – Product/Service Item Configuration;

11.1.3.

Procure to Pay / Return to Debit; and

11.1.4.

Order to Cash / Return to Credit.

11.2.

Organizational Structure – Subsidiary Management

Subsidiary Name

Parent Subsidiary

Operations

Base

Currency

[INSERT SUBSIDIARY ENTITY NAME]

[INSERT PARENT ENTITY NAME]

Canada

CAD

[INSERT SUBSIDIARY ENTITY NAME]

[INSERT PARENT ENTITY]

Canada

CAD

[INSERT SUBSIDIARY ENTITY NAME]

[INSERT PARENT ENTITY]

USA

USD

11.2.1.

Assumptions:

11.2.1.1.

A single consistent Chart of Accounts (“COA”) for parent and all subsidiaries will be configured. Individual accounts within the COA can be limited to only one subsidiary.

11.2.1.2.

Each subsidiary (unless otherwise identified) is 100% owned by the parent.

11.2.1.3.

All subsidiaries have the same fiscal year end (12/31).

11.2.1.4.

All subsidiaries will be configured with the user interface in English.

11.3.

Currency

11.3.1.

Definition of multiple foreign currencies – USD, CAD, etc.

11.3.2.

Currency exchange rate table and open transaction revaluation; and

11.3.3.

Exchange rate integration feature.

11.4.

Process Area Configuration Detail

11.4.1.

Record to Report (Included Activities):

11.4.1.1.

Departments Segment (50 max) - replicated across books;

11.4.1.2.

Classes Segment (50 max) - replicated across books;

11.4.1.3.

Single Chart of Accounts (300 max);

11.4.1.4.

Subsidiaries (2 max);

11.4.1.5.

Accounting Periods - 12 Calendar Month;

11.4.1.6.

Multiple Currencies & Exchange Rates; and

11.4.1.7.

Up to 1 Budget, segmented by department & subsidiary.

11.4.2.

Design to Build (Included Activities)

11.4.2.1.

Item Master to include the following items types (max 500);

11.4.2.2.

Item Type;

11.4.2.3.

Non-Inventory;

11.4.2.4.

Service; and

11.4.2.5.

Discount/Markup.

11.4.3.

Procure to Pay / Return to Debit (Included Activities):

11.4.3.1.

Vendor Master;

11.4.3.2.

Employee Master;

11.4.3.3.

Purchase Requests/Orders;

11.4.3.4.

Vendor Bills;

11.4.3.5.

Amortization Schedules (up to 5 schedules);

11.4.3.6.

Vendor Bill Payments;

11.4.3.7.

Vendor Credits; and

11.4.3.8.

Expense Reports.

11.4.4.

Order to Cash / Return to Credit (Included Activities):

11.4.4.1.

Customer Master;

11.4.4.2.

Sales Orders;

11.4.4.3.

Customer Invoice;

11.4.4.4.

Customer Payments; and

11.4.4.5.

Credits Memo.

11.5.

General Configuration Scope Detail

11.5.1.

This SOW includes the following general configuration and setup activities:

11.5.1.1.

Personalization of Company Information, Rename Records/Transactions, Auto- Generated Numbers and Preferences; and

11.5.1.2.

Installation of NetSuite Leading Practice dashboards, without modification.

11.5.2.

This SOW includes the following general configuration/personalization of the following UI forms:

11.5.2.1.

Customer Form;

11.5.2.2.

Employee Form;

11.5.2.3.

Item Form(s);

11.5.2.4.

Vendor Form

11.5.2.5.

Sales Order Form;

11.5.2.6.

Invoice Form;

11.5.2.7.

Purchase Order Form; and

11.5.2.8.

Vendor Bill Form.

11.5.3.

Assumptions:

11.5.3.1.

Positive will create up to twenty-five (25) total custom fields for use on the above Custom Forms;

11.5.3.2.

Positive will create up to five (5) custom saved searches; and

11.5.3.3.

Positive will create up to five (5) custom reports.

11.5.4.

This SOW includes the following general configuration/personalization of the following printed forms:

11.5.4.1.

Check;

11.5.4.2.

Invoice;

11.5.4.3.

Purchase Order

11.5.4.4.

Sales Order; and

11.5.4.5.

Credit Memo.

11.5.5.

This SOW includes the following preconfigured roles (please note: our standard SOW includes one “Account Reviewer” preconfigured role, other roles used as additional users and may be purchased for an additional fee, as mutually agreed between You and Positive).

11.5.5.1.

CEO (Hands Off);

11.5.5.2.

Accountant Reviewer;

11.5.5.3.

Purchasing Manager;

11.5.5.4.

Sales Rep;

11.5.5.5.

Sales Manager; and

11.5.5.6.

Positive will create up to five (5) customized roles as required for the client.

11.6.

Data Migration Scope Detail:

11.6.1.

Import Services;

11.6.1.1.

Positive will import the following data from Customer’s legacy systems into NetSuite.

11.6.1.2.

Customer will be responsible for the necessary data encryption, data extraction, data consolidation and data cleansing work required for all data migration.

11.6.1.3.

Positive will provide Customer with templates for each data type to be migrated and will advise Customer on best practices for data consolidation and data planning.

11.6.2.

List Data Imports.

Entity

Import

Method

Responsibility

for Extraction

Responsibility

for Data

Integrity

Responsibility

for Data

Import

Responsibility

for

Reconciliation

Max #

of

Records

Chart of Accounts

300

CSV

You

You

Positive

You

Employees

100

CSV

You

You

Positive

You

Vendors

250

CSV

You

You

Positive

You

Customers

250

CSV

You

You

Positive

You

Contacts

250

CSV

You

You

Positive

You

Items

500

CSV

You

You

Positive

You

Entity/Object

Max # of

Records

Import

Method

Responsibility

for Extraction

Responsibility

for Data

Integrity

Responsibility

for Data

Import

Responsibility

for

Reconciliation

Opening Balance

1 CoA

CSV

You

You

Positive

You

Historical

Transactions/Trial

Balances

Current

Year

CSV

You

You

Positive

You

Open AP

250 records

CSV

You

You

Positive

You

Open AR

250 records

CSV

You

You

Positive

You

11.6.2.1.

Should you require import of historical data over and above what is outlined in 5.6.2., there will be an additional cost, as preapproved between You and Positive.

11.7.

User Enablement Scope Detail

11.7.1.

Positive will train a super user on functional processes that are designated as in scope. This is a “train the trainer” approach; classroom training sessions for the entire customer user base will not be provided. These training services will include:

11.7.1.1.

Development of a training plan; and

11.7.1.2.

Remote live sessions for process areas identified.

11.7.2.

Training Plan and Deliver:

11.7.2.1.

Positive will collaborate with You on the creation of a training plan that will be used as the basis for the delivery of the end user training; and

11.7.2.2.

Total NetSuite training is not to exceed 5 hours. Supplementary training can be acquired at an additional hourly rate.

11.7.3.

Project Team:

11.7.3.1.

You are responsible for providing and ensuring Your committed participation of resources required during the Onboarding Project. Positive resources are not necessarily dedicated to any single project and may be engaged across many projects for various customers.

11.7.4.

Project Roles and Responsibilities:

11.7.4.1.

It is important to understand this is a list of project roles, not individuals required to complete the Project. Depending on the size of the engagement, a single individual may take responsibility for any number of roles or a single role may require more than one individual.

11.7.4.1.1.

Sponsor - Responsible for providing Customer resources needed for a successful implementation and promote process change where necessary.

11.7.4.1.2.

Project Manager - Responsible for the oversight of Customer resources, schedules and deliverables.

11.7.4.1.3.

Business Process Owner - Responsible for review and acceptance processes and identification of any exceptions.

12.

Fees

Resource Name

Service

Estimated No. of

months

Rate per month

USD$

Total USD$

Positive  Venture

Hub

NetSuite

onboarding

1 month (June 

2020) Onboarding to be

initiated June 8

$ 15,000.00

Bill to be submitted

June 15

$ 15,000.00

Positive  Venture

Hub

Outsourced

Finance Services

11 months

(July 2020 - May 2021)

$ 11,500

$ 126,500.00

CFO

11 months

(July 2020 - May 2021)

FP&A

11 months

(July 2020 - May 2021)

TOTAL

12 months

$141,500.00

13.

Third-Party Software

13.1.

As part of the Service, Positive is sublicensing the following Third-Party Software to Client:

•

NetSuite “▇▇▇▇ LE – SmallBiz OneWorld”, Pricing Category 3 (less than $20,000,000.00 USD Revenue) (“NetSuite Service”).

13.2.

Client’s use of the NetSuite Service is subject to the following terms and conditions:

A - 1:

Project Change Control Procedure

(1)

Positive and you may determine that it is necessary to exceed the number of estimated hours for the Services as stated in above. In such event, you may authorize additional hours and funding by the written request of your SOW signatory. The request must reference the SOW number. Through the end of the calendar year (i.e., December 31) during which this SOW is originally executed, additional hours, funding, and End-Date extension may only be requested in writing, at the originally contracted hourly rate, specified in SOW Section 4, Fees. All Changes require a Project Change Request as detailed below.

(2)

A Project Change Request (PCR) will be the vehicle for communicating change. The PCR must describe the change, the rationale for the change and the effect the change will have on the project.

(3)

A PCR must be signed by authorized representatives from both parties to authorize implementation of the change. Until a change is agreed to in writing, both parties will continue to act in accordance with the latest agreed version of the SOW.