EXHIBIT 10.2
CONSULTING AGREEMENT
BETWEEN:
TOTAL FIRST AID, INC.,
A body incorporated,
With a registered office in the State of Florida, including its subsidiaries
(Hereinafter referred to as the "Corporation")
- And -
6237819 CANADA INC.
A body incorporated under the laws of Canada,
With a registered office in the Province of Ontario,
(Hereinafter referred to as the "Consultant")
- And -
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Of the City of Aylmer, in the Province of Quebec,
(Hereinafter referred to as the "Service Provider")
WHEREAS the Corporation is acquiring all of the issued and outstanding
shares of Progestic International Inc., ("Progestic"), (the "Transaction");
AND WHEREAS Progestic carries on the business of supplying services in
the Information Technology sector;
AND WHEREAS the Consultant and the Service Provider have the
qualifications, skills and experience to provide the required services;
AND WHEREAS after the Transaction, the Corporation wishes to retain the
services of the Consultant for a specified period of time;
AND WHEREAS after the Transaction, Consultant wishes to offer its
services to the Corporation for the same specific period of time;
AND WHEREAS the Corporation specializes in the Information Technology
(IT) consulting and outsourcing services in Canada and the United States.
AND WHEREAS the Corporation and the Consultant wish to define the terms
and conditions of this Consulting Agreement;
AND WHEREAS this Consulting Agreement forms an integral part of the
executed Share Purchase Agreement between the Corporation and Progestic, with an
effective date the day after the closing of the Transaction, which terms,
conditions, references and definitions are hereby incorporated and will have the
same meanings as used in the said Share Purchase Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained and other good and valuable consideration (the receipt and
sufficiency of which is hereby acknowledged) the parties have agreed and this
Consulting Agreement (the "Agreement") witnesses as follows:
ARTICLE 1
CONDITIONAL OFFER AND EFFECTIVE DATE
1.1 The preamble forms an integral part of this Agreement.
1.2 This Agreement is conditional upon the closing of the transactions
contemplated by the Share Purchase Agreement (the "Transaction"). If the
Transaction does not close, this Agreement shall be null and void ab initio, and
all obligations, including any obligation of compensation or payment to the
Consultant, shall cease.
1.3 The effective date (the "Effective Date") of this Agreement shall
be the day following the closing of the Transaction.
ARTICLE 2
INDEPENDENT CONTRACTOR
2.1 This is an Agreement for the services of the Consultant as a
separate business unit, and the Consultant shall not be entitled to any benefits
of any nature whatsoever other than to those which are expressly provided for
herein.
2.2 The Consultant is acting exclusively as a business unit separate
from that of the Corporation and no relationship of agency, partnership, joint
venture, employer-employee, or master-servant is created between the Consultant
and the Corporation.
2.3 It is acknowledged and agreed by the Consultant and the Corporation
that the Consultant shall be and at all time is acting and performing as a
consultant to the Corporation. The Consultant agrees not to represent to any
other party that the Consultant is an agent, partner, joint venture, employee,
or servant of the Corporation.
2.4 The Consultant agrees that he shall indemnify and save harmless the
Corporation against any and all claims, actions, causes of action, debts or
demands relating to deductions and withholdings under federal, state or
municipal law including those under the Income Tax Act as amended from time to
time, and any claims related to Employment Insurance, Workers Security
Insurance, for or in respect of the provision of services under this Agreement,
together with any interest or penalties relating thereto and any costs or
expenses incurred by the Corporation in defending such claims, cause of action,
demand, debt or by any other authority.
2.5 The Consultant further agrees that he shall indemnify and save
harmless the Corporation from the Consultant's failure, omission or refusal to
remit deductions to the appropriate federal, provincial, state or municipal
government entity, agency or collecting body, as required by law.
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ARTICLE 3
TERM OF THE CONSULTING AGREEMENT
AND OBLIGATIONS OF THE CONSULTANT
3.1 On the Effective Date of this Agreement, the Service Provider shall
remain a Director of Progestic, and the Service Provider agrees to execute all
necessary documents to facilitate the nomination.
3.2 The Corporation engages the Consultant to provide and the
Consultant agrees to provide the Consulting Services commencing as at the
Effective Date, and continuing for two twelve (12) month periods. This
relationship and this Agreement will be renewed for additional twelve (12) month
period with the prior written consent of the Parties within sixty (60) days from
the termination of the second twelve-month period. If this Agreement is not
renewed, in accordance with the terms and conditions of section 3.2, this
Agreement shall terminate at the end of the applicable twelve (12) month period,
which date shall be referred to as the "Contract Termination Date
3.3 The Parties agree that during the initial transition period of six
months, the Service Provider shall provide the Consulting Services hereunder.
After the said transition period, the Consultant may replace the Service
Provider with the prior written consent of the Corporation. The new Service
Provider will be bounded by the terms and conditions of this agreement. Any
deviation of this clause shall be a breach of a material provision of this
Agreement by the Consultant.
3.4 Services retained:
3.4.1 The Corporation retains the professional services of the
Consultant to perform the services, roles and responsibilities as described in
Schedule 3.4.1 and its amendments (the "Consulting Services").
3.4.2 It is agreed and acknowledged that Schedule 3.4.1 may be amended
in writing from time to time as agreed to by the Parties.
3.4.3 Schedule 3.4.1 and its respective amendments shall form an
integral part of this Agreement and shall be governed by the terms and
conditions put forth in this Agreement. In the event of any conflict between
this Agreement and Schedule 3.4.1 and its amendments, the terms and conditions
of the Schedule 3.4.1 and its amendments shall prevail.
3.5 The Consultant shall perform the Consulting Services in accordance
with and in the following manner:
3.5.1 In accordance with Schedule 3.4.1
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3.5.2 In a good professional and workmanlike manner and in accordance
with accepted industry standard practices;
3.5.3 In compliance with all applicable federal, state, provincial, and
local laws and regulations, and the Corporation's policies (as those policies
pertain to consultants).
3.6 It is agreed by the Parties that during the term of this Agreement,
the Consultant will perform the Consulting Services in accordance with the
Corporation's objectives and requirement on a timely basis.
3.7 The Consultant shall receive instructions from and report to the
Chairman and Chief Executive Officer (CEO) of the Corporation.
3.8 In the event that the Consultant or the Service Provider is or
becomes subject to any legal proceedings instituted by third parties with
respect to the Consulting Services:
3.8.1 If the Consultant or the Service Provider is found guilty of
gross negligence, material omission, malpractice or this Agreement is terminated
in accordance with Section 3.5.3 herein, the Consultant or the Service Provider
agrees to indemnify the Corporation for all legal services and costs related to
the said legal proceedings;
3.8.2 If the said legal proceedings are instituted for reasons other
than those in Section 3.8.1 herein and this Agreement is not terminated in
accordance with 5.1 herein, the Corporation agrees to indemnify the Consultant
or the Service Provider for all legal services and costs related to the said
legal proceedings.
3.9 The Consultant and the Service Provider agree to return to the
Corporation any and all computers, discs, tapes, files, documents and working
papers acquired and/or produced under this Agreement within three working days
of termination of this Agreement.
ARTICLE 4
FEE ARRANGEMENT
4.1 Subject to the terms of this Agreement, Consultant shall be paid by
the Corporation for the provision of the Consulting Services on a monthly
retainer of 7,500 USD plus any applicable taxes, within 5 business days of the
following month.
4.2 The Consultant shall not be entitled to be a participant in any of
the employee or other benefit plans of the Corporation.
4.3 The Corporation shall pay to the Consultant all reasonable expenses
actually and properly incurred by the Consultant in connection with the
performance of its obligations under this Agreement, such expenses to be
documented in accordance with the Corporation's standard policies and shall be
subject to approval by the Corporation. The Consultant shall submit statements
and vouchers for all such expenses once a month, at the end of each month.
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4.4 The consultant shall participate as a member of the Business
Development Team of the Corporation . The Consultant shall be, given from time
to time, specific Mergers and Acquisitions and Financing mandates. The
Consultant's compensation package for these said mandates shall be defined and
accepted in writing by the Corporation prior to the execution of these said
mandates. The Consultant shall be paid at closing of these transactions. These
mandates will form an integral part of this agreement and shall be defined and
attached in Schedule 4.4
ARTICLE 5
TERMINATION
5.1 TERMINATION FOR CAUSE
The Corporation will terminate this Agreement at any time and, the
Corporation's obligation to compensate Consultant with respect to this Agreement
will terminate upon written notice to Consultant and Service Provider in the
event that Consultant or Service Provider is in breach of or in default of the
following:
5.1.1 Section 3.3 herein;
5.1.2 Section 3.5 herein;
5.1.3 Change of control of Consultant without the prior written
approval of the Corporation;
5.1.4 Article 6 herein during the term of this Agreement;
5.2 TERMINATION BY CONSULTANT OR SERVICE PROVIDER
If Consultant and/or Service Provider terminates this Agreement at any
time for the following reasons, this Agreement shall terminate all obligations,
including any obligation of compensation or payment to Consultant by the
Corporation shall cease and the Restricted Period (as hereinafter defined) shall
be three (3) months:
5.2.1 Election of Consultant or Service Provider;
5.2.2 The death or disability of Service Provider, for the purposes of
this Agreement, long-term disability shall mean the inability of Service
Provider to provide the Consulting Services for a period of 90 days.
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5.3 TERMINATION WITHOUT CAUSE
5.3.1 If the Corporation terminates this Agreement without cause, the
Corporation will continue to pay Consultant the amount referred to in Section
4.1 herein for the balance of the agreed term of 24 months from the date of
execution of this Agreement, including any amounts owed to the Consultant
pursuant to Section 4.4 and the Restricted Period shall be six (6) months.
5.4 TERMINATION FOR ANY REASON
Notwithstanding section 5.3.1, upon termination of this Agreement for
any reason, the Corporation will pay Consultant, within five (5) business days
of Consultant's last day actively performing the Consulting Services for the
Corporation, the following:
5.4.1 All Consulting Services fees plus applicable taxes earned, but
not yet paid, on a pro-rata basis, for the month of termination;
5.4.2 Any expenses incurred and not paid in accordance with this
Agreement.
5.5 The provisions of Article 6 herein shall survive the termination of
this Agreement, regardless of the reason for termination, notwithstanding that
the applicable restricted period of ARTICLE 6 herein shall vary in accordance
with the cause of termination of this Agreement (the " Restricted Period").
Unless a different time period is specified, the Restricted Period shall be 12
months.
ARTICLE 6
PERSONAL COVENANTS AND
POST-AGREEMENT OBLIGATIONS
6.1 The Consultant and the Service Provider have carefully read and
considered the provisions of this Article 6 and, having done so, agree that the
restrictions set forth in this Article are fair and reasonable, and are
reasonably required for the protection of the interests of the Corporation and
to protect the value of the business purchased by the Corporation in the
Transaction. The Consultant and the Service Provider recognize and agree that as
a consultant of the Corporation they will become knowledgeable, aware and
possessed of confidential information of the Corporation and other affiliated
companies including their investor's, customer's and other consultant's,
technology, know-how, products and technical and business data, marketing
strategies and investor programs shall be referred to in this Agreement as the
("Confidential Information"). The Consultant and the Service Provider
acknowledge and agree that the Corporation is the sole and exclusive owners and
proprietors of all such Confidential Information, and that the Consultant and
the Service Provider owe a duty to ensure that all Confidential Information is
and remains at all times confidential.
6.2 Non Competition
a. The Consultant and the Service Provider further acknowledge
that in the course of this consulting relationship, they will be assigned duties
that will give them knowledge of Confidential Information and proprietary
information which relates to the conduct and details of the Corporation's
businesses and which may result in irreparable injury if the Consultant and/or
the Service Provider would enter into an employment or consulting relationship
with a business which is the same as or similar to and which is competitive to
the Business (as Business is hereinafter defined). The Consultant and the
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Service Provider agree with, and for the benefit of, the Corporation, that the
Consultant and the Service Provider shall not without the prior written approval
of the Board of Directors of the Corporation during the term of this Agreement
or at any time within the Restricted Period as of the Contract Termination Date,
either as an individual or as a partner or joint venture or otherwise in
conjunction with any person or persons, firm, association, syndicate, company or
corporation, as principal, agent, consultant, director, officer, employee,
investor or in any other manner whatsoever, directly or indirectly, carry on, be
engaged in, be interested in, or be concerned with, or permit the Consultant's
or the Service Provider's names or any part thereof to be used or employed by
any such person or persons, firm, association, syndicate company or corporation,
carrying on, engaged in, interested in or concerned with, a business which is
the same as or similar to the business conducted by the Corporation or as at the
date of termination of this Agreement (the "Business") within the Province of
Ontario and Quebec.
b. The Consultant and the Service Provider have the right to
request in writing to the Board of Directors of the Corporation, in advance for
agreement that a proposed business or position is not prohibited within the
terms of this Agreement. If the Consultant and the Service Provider receive
written acknowledgment that the Board of Directors of the Corporation do not
object to the Consultant's or the Service Provider's participation in the said
requested business or position, then they shall be allowed to so participate.
c. This Article shall not prevent the Consultant or the
Service Provider from purchasing as a passive investor up to 5% of the
outstanding publicly traded shares or other securities of any class of an issuer
listed on a recognized stock exchange.
6.3 Non-Disclosure
The Parties understand that the Corporation desires to keep their
contractual relationship with their investors, customers and other consultants
confidential. The Consultant and the Service Provider agree during the term of
this Agreement and thereafter not to disclose any such investor, customer or
other consultant relationships unless authorized in writing by the Board of
Directors of the Corporation or as required by applicable law.
6.4 Confidential Information
The Consultant and the Service Provider will have access to the
Confidential Information. The Consultant and the Service Provider agree to
accept and retain said Confidential Information in confidence and, at all times
during or after the termination of this Agreement, not to disclose or reveal
such information and data for purposes other than those authorized by the
Corporation or as required by applicable law. At the request of the Corporation
and upon termination of this Agreement, the Consultant and the Service Provider
will promptly turn over to the Corporation, all written or descriptive matter
containing the Confidential Information or proprietary information or data.
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6.5 Patent-Copyright
a. The Consultant and the Service Provider agree to make
prompt and complete disclosure to the Corporation of any (i) invention,
discovery, or improvement ("Invention"), whether patentable or not and (ii)
copyrightable material, which relate to the Business and which are made,
conceived, or authored by the Consultant or the Service Provider, alone or with
others, during the term of this Agreement and, with respect to an Invention, for
one (1) year following the Contract Termination Date. All works produced by the
Consultant shall be deemed "work made for hire."
b. The Consultant and the Service Provider agree to and do
hereby assign to the Corporation all of their right, title and interest in any
Invention(s) and copyrightable material. At the request and expense of the
Corporation, the Consultant and the Service Provider will render whatever
assistance may be necessary for the Corporation to secure a patent or copyright
for such Invention(s) or material.
6.6 Non-Solicitation
The Consultant and the Service Provider agree that as a result of their
position with the Corporation, that they will have access to the Confidential
Information. The Consultant and the Service Provider agree that during the term
of this Agreement or at any time within the Restricted Period as of the Contract
Termination Date, regardless of the reason for termination that the Consultant
and the Service Provider shall not:
(i) directly or indirectly, either as an individual or as a
partner or joint venture, or as an employee or principal, management,
consultant, agent, shareholder, officer, director, or sales person for any
person, firm, association, organization, syndicate, company or corporation,
solicit or accept any business from any Client of the Corporation.
(ii) hire, solicit, or attempt to induce any employee of the
Corporation to leave the Corporation's employ and work directly or indirectly
for or with the Consultant and the Service Provider or any employer or
contractor of the Consultant and the Service Provider; or
(iii) hire, solicit, or attempt to induce any contractor or
sub-contractor of the Corporation to not perform their respective duties or to
leave the Corporation and work directly or indirectly for or with the Consultant
or the Service Provider or any employer or contractor of the Consultant and the
Service Provider.
6.7 Property
All reports, computer programs, manuals, tapes, card decks, listings
(including customer listings) and any other documentation or data furnished to
or prepared by the Consultant in connection with this Agreement shall be the
property of the Corporation.
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ARTICLE 7
GENERAL PROVISIONS AND NOTICE
7.1 Any waiver by a Party of any breach of any provision of this
Agreement by the other Party shall not be binding unless in writing, and shall
not operate or be construed as a waiver of any other or subsequent breach by the
Consultant or the Service Provider.
7.2 This Agreement contains the entire agreement between the Parties
and may be changed only by agreement in writing signed b the Parties hereto.
7.3 This Agreement shall be governed by and construed in accordance
with the laws in force in the State of Florida, U.S.A.
7.4 If any paragraph, subparagraph or provision of this Agreement is
determined to be unenforceable by a Court of competent jurisdiction, then such
provision shall be severable from the Agreement and the remainder of this
Agreement shall be unaffected thereby and shall remain in full force and effect.
7.5 Any notice required to be given hereunder shall be in writing and
sufficiently made if delivered personally, sent by facsimile transmission, or
mailed by prepaid registered mail to the Parties at their respective addresses
herein.
7.6 Any such notice shall be deemed to have been given on the date it
is delivered if personally delivered or sent by facsimile, or if mailed, on the
third business day following the mailing thereof. Any of the Parties may change
its address for service by giving written notice hereunder.
7.7 Time shall be of the essence of this Agreement.
THE CORPORATION:
First Aid Direct, Inc.
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CONSULTANT:
6237819 Canada Inc.
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THE SERVICE PROVIDER:
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1286 rue, Grande Allee
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IN WITNESS WHEREOF the Parties hereto have executed this Agreement.
FIRST AID DIRECT, INC.,
PER:
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CONSULTANT'S COMPANY
PER:
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THE SERVICE PROVIDER
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SCHEDULE 3.4.1
CONSULTANT AND SERVICES PROVIDER MANDATE
This Schedule 3.4.1 forms an integral part of the Consulting Agreement executed
between the Parties and the said Consulting Agreement forms an integral part of
the Share Purchase Agreement executed between the Corporation and Progestic with
an effective date as the day after the closing of the Transaction.
CONSULTANT AND THE SERVICES PROVIDER (CSP)
The CSP will report to the Chairman and CEO of the Corporation and jointly with
him and the other members of the corporate development team shall maximize the
Corporation's shareholder value.
The CSP will exercise flexibility to work with and support the Corporation's
other executives in their respective mandates, provide financial guidance,
participate in business development activities, prepare related financial and
business development reports.
THE CSP'S CONSULTING ACTIVITIES AND PARTICIPATION ARE, BUT NOT LIMITED TO:
o Understanding and adhering to the Corporate's overall business and
corporate objectives;
o Participate in the preparation of financing documents;
o Participate in the evaluation of Corporation's Mergers & Acquisitions,
new business opportunities, and joint venture partnerships;
o Search, identify and screen potential companies for acquisition
targets;
o Solicit and qualify the level of interest of targeted companies;
o Initiate preliminary negotiations;
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o Prepare an analysis and recommendation report with:
o Target company synergy with the Corporation
o Proposed acquisition architecture;
o Proposed corporate and management restructuring scenarios;
o Proposed financial structure, equity and debt instruments and their
respective attributes;
o Prepare and recommend appropriate road map and time line for closing;
o Participate in the preparation of the MOU;
o Assist and lead the due diligence process;
o Participate and coordinate the Share Purchase Agreement negotiations up
to closing
o Prepare and present up to date progress report of transactions.
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