SWEAT EQUITY AGREEMENT
BETWEEN:
_______________________________________
(THE “INVESTOR”)
– AND –
________________________________________
(THE “COMPANY”)
– AND –
_________________________________________________
(COLLECTIVELY, THE “SHAREHOLDERS” AND INDIVIDUALLY AS A “SHAREHOLDER”)
__________________________________________________________________________________
THIS AGREEMENT is made on the …………..day of……….20……., by the Investor, Company and the Shareholder(s) (collectively referred to as the “Parties” or individually as the “Party”) and includes that Party’s successors and assigns.
WHEREAS, the Company is a [corporation / limited company] duly incorporated under the laws of New York and in need of an Application for its business.
WHEREAS, the Investor is willing to build such Application for the Company (the “services”) in exchange for the consideration defined below.
WHEREAS, the Shareholder(s) each own ________ [class] [Common / Preferred] Shares of the Company, are the only shareholders of the Company.
Therefore, and in consideration of the entering into of this Agreement, the sufficiency of which is hereby
acknowledged, the Company, the Investor and the Shareholders agree as follows:
Commencement and duration: This agreement shall be valid from ____________until termination.
Consideration:
- In consideration for the Investor’s willingness to enter into this Agreement and the services to be rendered to the Company hereunder, the Investor shall receive;
- ______% of _____________shares (type of share) within __________days of execution of this agreement; and
- 2% of the Company’s profits every year payable at the end of each financial year.
- This consideration shall only be payable while the Investor is working for the Company.
- The Investor agrees to perform the Services on a timely basis, to the best of his abilities and in accordance with professional quality standards in his industry.
- The Investor agrees that he will not be paid any fees for performance of the Services, and that his full payment for performance of the Services is the grant of the consideration set out in this Agreement.
Indemnification: A Party shall indemnify the other Party from and against all claim, loss, and damage caused by them in connection with this Contract. In the event the claim, loss, or damage are caused jointly by the Parties, the claims, loss, or damage shall be borne by each Party in proportion to their degree of contribution to the claim, loss, or damage.
Intellectual property
All intellectual property belonging to the Company shall be the Company’s exclusive property. At the Company’s discretion, the Investor may enjoy a non-exclusive, limited use license to the intellectual property.
The Investor agrees that any intellectual property and associated rights owned, discovered, or developed by them, solely or jointly with others, in connection with their services performed under this agreement, shall constitute works for hire and shall automatically, upon their creation or discovery, become the exclusive property of the Company.
Without limiting the generality of the above, the Company shall own the technology, domains, license and associated rights of the Application.
Relationship of the Parties: The Investor is an independent Contractor. Accordingly, the Investor shall not be deemed an agent, partner, or joint venturer of the others Parties for any purpose due to this agreement or the transactions contemplated thereby.
Non-assignment: No Party shall transfer or assign this agreement without the other Party’s consent. This consent shall not be unreasonably withheld or detailed.
Confidentiality: Investor acknowledges and agrees that any information, documents or data that Investor or Investor’s representatives, if any, have acquired from or about the Company or Shareholder(s), (hereinafter “Disclosing Party”) not otherwise in the public domain, was received in confidence. Investor agrees not to divulge, communicate or disclose, except as may be required by applicable law or for the performance by Investor of this Agreement, or use to the detriment of the Disclosing Party or for the benefit of any other person or entity, or misuse in any way, any confidential information of the Disclosing Party.
Force Majeure
For this agreement, “Force Majeure” means an event which a diligent party could not have reasonably avoided in the circumstances, which is beyond the control of a party and includes, but is not limited to, war, riots, civil disorder, earthquake, storm, flood or adverse weather conditions, strikes, lockouts or other industrial action, terrorist acts, confiscation or any other action by government agencies.
A Party’s failure to fulfill its obligations due to Force Majeure, shall not be considered a breach of this agreement, provided that the Party has taken all reasonable precautions, due care, reasonable alternative measures, and minimal delay all to carry out the terms of this agreement.
Termination:
- Either Party may terminate this agreement upon giving the other Party no less than ________days’ notice in writing. If a Party wishes to terminate the contract with less than these stated days, the other Party reserves the right to charge costs that they have already paid in advance or incurred.
- The Investor’s term under this agreement may terminate due to but not limited to the Investor’s non-performance e.g. losses are caused or no updates or completion are caried out.
- The termination of this agreement shall not discharge the liabilities accumulated by either Party.
- Any Clauses intended by the Parties or this agreement to survive the termination of this agreement shall survive the termination of this agreement by whatever cause.
Dispute resolution: Parties agree to settle disputes under this agreement through (select one)
☐Negotiation ☐Mediation ☐Arbitration ☐Litigation
Court Costs and Attorneys’ Fees: In any action under this agreement, the prevailing Party shall be entitled to recover costs of court and reasonable attorneys’ fees from the other Party, which fees shall be in addition to any other relief that may be awarded.
Further Assurances: Investor agrees to execute, acknowledge, and deliver any and all documentation as may be reasonably required from time to time to effect the intent and purpose of this Agreement.
Notices: Any notice required to be given pursuant to the provisions of this Agreement shall be in writing and shall be deemed to have been given at the time when actually received as a consequence of any effective method of delivery at the address below or at such changed address as the party shall have specified by written notice, provided that any notice of change of address shall be effective only upon actual receipt.
Investor: ___________________________________________________________________________
Company: ___________________________________________________________________________
Shareholder: _________________________________________________________________________
Amendment: This agreement may be amended only by the written consent of the Parties hereto.
Captions: The captions in this Agreement are for convenience and reference purposes only and in no way define, describe, extend or limit the scope of this Agreement or the intent of any provisions hereof.
Waiver: Unless otherwise provided, failure by either Party to enforce any of the terms or conditions of this agreement shall not be a waiver of their right to enforce the terms and conditions of this agreement.
Severability: If any provision is held to be invalid or unenforceable, it shall not affect the validity or enforceability of any other provision.
Counterparts: This agreement may be executed in any number of counterparts, each of which shall be an original and all of which shall together constitute the same instrument.
Number and Gender: All pronouns and any variation thereof shall be deemed to refer to the masculine, feminine, neuter, singular or plural, as the identity of the party or parties, or their personal representatives may reasonably require.
Enforcement and Governing Law: This agreement shall be governed in all respects by the laws of New York without regard to its conflicts of law provisions.
Entire Agreement: This agreement constitutes the entire agreement between the Parties. It supersedes all prior oral or written agreements or understandings between the Parties concerning the subject matter of this agreement. The parties will exercise utmost good faith in this agreement.
Parties’ acknowledgments: The Parties acknowledge that they have been provided with the opportunity to negotiate this agreement and to seek legal counsel before signing this agreement. In addition, they acknowledge that they have the capacity to contract and enter into this agreement and that further, they have entered into this agreement freely and voluntarily.
IN WITNESS WHEREOF, each of the Parties has executed this agreement, as set forth below.
Signed by the INVESTOR
Name: Signature: Date:
Signed by the duly authorized representative of the COMPANY
Name: Designation: Signature: Date:
Signed by the Shareholders (s)
Name: Signature: Date:
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