EXHIBIT 10.1

 

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SETTLEMENT AND RELEASE AGREEMENT

 

 

THIS SETTLEMENT AND RELEASE AGREEMENT ("Agreement") is entered into as of
November 13, 2015 (the "Effective Date"), by and among Skkynet Cloud Systems,
Inc., a Nevada corporation with an address at 2233 Argentia Road, Suite 306,
Mississauga, ON L5N 2X7, Canada ("Skkynet"), Cogent Real-Time Systems Inc., a
Canadian Federal corporation ("Cogent") (Skkynet and Cogent shall be
collectively referred to herein as "Employer") and, an individual residing at,
Canada (the "Employee"). Employer and Employee are referred to in this Agreement
individually as the "Party" or collectively as the "Parties."

 

AGREEMENT

 

1.

Employer owes to Employee US$ for services incurred by Employee during the
period of November 1, 2013 through October 31, 2015 (the "Accrued Fees").
Employer and Employee desire to settle the Accrued Fees pursuant to the terms of
this Agreement.

2.

Employer agrees to issue to Employee options to purchase shares of the common
stock, par value $0.001 per share, of Employer pursuant to the terms and
conditions set forth in the option purchase agreement set forth on Exhibit A
hereto.

3.

In consideration of the performance of Employer described in Paragraph 2, above,
Employee, on behalf of itself and its successors, assigns, members, managers,
officers, employees, agents, and representatives hereby releases and forever
discharges, Employer, together with its successors, assigns, directors,
officers, agents, employees, and representatives, from any and all actions,
causes of action, claims, liability, demands, damages, costs, and expenses of
every kind whatsoever, in law or in equity, known or unknown, contemplated,
accrued, existing or not yet mature, which Employee has or may have as of the
Effective Date relating specifically to the Accrued Fees. This paragraph shall
not discharge Employer from any obligations arising out of this Agreement.

4.

The Parties represent that they have made no assignment and will make no
assignment of the actions, causes of action, or claims released herein.

5.

It is expressly understood that any action by any Party in connection with this
Agreement is not, and shall not be construed as, an admission of liability;
rather, any such actions are made and done only as part of this settlement and
release of disputed claims.

6.

Each undersigned Party acknowledges that: (1) the Party has read this Agreement
fully and carefully before signing it; (2) the Party has consulted with or has
had the opportunity to consult with an attorney regarding the legal effect and
meaning of this Agreement and all of its terms and conditions, and that the
Party is aware of the contents of this Agreement and its legal effects; (3) the
Party has had the opportunity to make whatever investigation or inquiry that the
Party deems necessary or appropriate in connection with the subject matter of
this Agreement; (4) the Party is of sound mind and is executing this Agreement
voluntarily and free from any undue influence, coercion, duress, or fraud of any
kind; and (5) the Party is waiving and releasing all claims against the other
Party as provided herein knowingly and voluntarily.

 

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SETTLEMENT AND RELEASE AGREEMENT

 

   

7.

This Agreement shall be governed by and construed in accordance with the laws of
the State of Nevada.

8.

It is expressly understood and agreed that the execution and performance of this
Agreement is in full accord and satisfaction of all demands between the Parties
as of the Effective Date of this Agreement. This Agreement shall be binding and
inure to the benefit of the Parties and their successors and assigns.

9.

The Parties acknowledge that this Agreement contains the entire agreement and
understanding between the Parties relating to the subject matter hereof, and
that this Agreement merges and supersedes all prior discussions and
understandings between the Parties relating to said subject matter. The Parties
confirm that no promise or inducement not expressed in the written terms of this
Agreement has been made to the other. In entering into this Agreement, the
Parties are not relying upon any statement or representation not contained in
this Agreement made by any other Party, the Party's counsel, partners,
directors, managers, members, officers, employees, agents, or any other person
representing either of the Parties concerning the nature, severity, extent, or
consequences of any injuries, damages, losses, costs, and claims of any Party
hereto and any liability therefor.

10.

Whenever possible, each provision of this Agreement shall be interpreted in a
manner as to be valid under existing law. A finding of invalidity as to any
provision of this Agreement or any portion thereof, shall void only that
provision or portion and no other, and this Agreement shall be interpreted as if
it did not contain such invalid provision or portion.

11.

The Parties shall perform any additional lawful acts, including the execution of
additional agreements, as are reasonably necessary to effectuate the purposes of
this Agreement.

12.

This Agreement may be signed in counterparts, each of which shall be deemed an
original, and all of which together shall constitute one and the same
instrument.

13.

This Agreement may be executed by exchange of facsimile copies. The facsimile
copies showing the signatures of the Parties shall constitute originally signed
copies of the Agreement requiring no further execution.

 

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SETTLEMENT AND RELEASE AGREEMENT

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.

 

 

SKKYNET CLOUD SYSTEMS, INC.

 

 

 

 

 

By:

 

 

Name:

Paul E. Thomas

 

 

Title:

President

 

 

 

 

 

 

 

 

 

COGENT REAL-TIME SYSTEMS INC.

 

 

 

 

 

 

By:

 

 

 

Name:

Andrew S. Thomas

 

 

Title:

President

 

 

 

 

 

 

 

 

 

EMPLOYEE

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

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SETTLEMENT AND RELEASE AGREEMENT

 

 

 

 

 

EXHIBIT A - INCENTIVE STOCK OPTION AGREEMENT

 

 

THIS INCENTIVE STOCK OPTION AGREEMENT (the "Agreement"), is made as of by and
between Skkynet Cloud Systems, Inc., a Nevada corporation (the "Company"), and
("Optionee").

 

RECITAL

 

Pursuant to the 2012 Stock Option Plan (the "Plan") of the Company, the Board of
Directors of the Company or a committee to which administration of the Plan is
delegated by the Board of Directors (in either case, the "Administrator") has
authorized the granting to Optionee of an incentive stock option to purchase the
number of shares of Common Stock of the Company specified in Paragraph 1 hereof,
at the price specified therein, such option to be for the term and upon the
terms and conditions hereinafter stated.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the promises and of the undertakings of the
parties hereto contained herein, it is hereby agreed.

 

1.

Number of Shares; Option Price; Grant Date. Pursuant to said action of the
Administrator, the Company hereby grants to Optionee the option ("Option") to
purchase, upon and subject to the terms and conditions of the Plan, a quantity
of shares of Common Stock of the Company ("Shares") as set out in Schedule A, at
a price per share as set out in Schedule A, and as of the date hereof ("Grant
Date") or as set out in Schedule A. The grant of the Option is made in
consideration of the Accrued Fees as described in the Settlement and Release
Agreement, dated November 24, 2015.

2.

Term. Each Option shall expire on the day before the tenth anniversary of the
Grant Date or as set out in Schedule A (the "Expiration Date") unless such
Option shall have been terminated prior to that date in accordance with the
provisions of the Plan or this Agreement. The term "Affiliate" as used herein
shall have the meaning as set forth in the Plan.

3.

Shares Subject to Exercise. Shares subject to exercise shall be 100% of such
Shares on the Grant Date, in recognition that the options issued under this
Agreement are in settlement of accrued fees under a Settlement and Release
Agreement. All Shares shall thereafter remain subject to exercise for the term
specified in Paragraph 2 hereof, provided that Optionee is then and has
continuously been in the employ of the Company, or its Affiliate, subject,
however, to the provisions of Paragraph 6 hereof.

4.

Method and Time of Exercise. The Option may be exercised by written notice
delivered to the Company at its principal executive office stating the number of
shares with respect to which the Option is being exercised, together with:

 

a.

a check or money order made payable to the Company in the amount of the exercise
price and any withholding tax, as provided under Paragraph 5 hereof; or

b.

if expressly authorized in writing by the Administrator, in its sole discretion,
at the time of the Option exercise, the tender to the Company of shares of the
Company's Common Stock owned by Optionee having a fair market value, as
determined by the Administrator, not less than the exercise price, plus the
amount of applicable federal, state and local withholding taxes.

 

Not less than 500 shares may be purchased at any one time unless the number
purchased is the total number purchasable under such Option at the time. Only
whole shares may be purchased.

 

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SETTLEMENT AND RELEASE AGREEMENT

 

 

 

 

 

EXHIBIT A - INCENTIVE STOCK OPTION AGREEMENT

 

  

5.

Tax Withholding. In the event that this Option shall lose its qualification as
an incentive stock option, as a condition to exercise of this Option, the
Company may require Optionee to pay over to the Company all applicable federal,
state and local taxes which the Company is required to withhold with respect to
the exercise of this Option. At the discretion of the Administrator and upon the
request of Optionee, the minimum statutory withholding tax requirements may be
satisfied by the withholding of shares of Common Stock of the Company otherwise
issuable to Optionee upon the exercise of this Option.

 6.

Termination of Employment. If for any reason other than death or permanent and
total disability, Optionee ceases to be employed by the Company or any of its
Affiliates (such event being called a "Termination"), this Option (to the extent
then exercisable) may be exercised in whole or in part at any time within three
months of the date of such Termination, but in no event after the Expiration
Date; provided, however, that if such exercise of this Option would result in
liability for Optionee under Section 16(b) of the Securities Exchange Act of
1934, then such three-month period automatically shall be extended until the
tenth day following the last date upon which Optionee has any liability under
Section 16(b), but in no event after the Expiration Date. If Optionee dies or
becomes permanently and totally disabled (as defined in the Plan) while employed
by the Company or an Affiliate or within the period that this Option remains
exercisable after Termination, this Option (to the extent then exercisable) may
be exercised, in whole or in part, by Optionee, by Optionee's personal
representative or by the person to whom this Option is transferred by devise or
the laws of descent and distribution, at any time within six months after the
death or six months after the permanent and total disability of Optionee, but in
no event after the Expiration Date. In the event this Option is treated as a
nonqualified stock option, then and to that extent, "employment" would include
service as a director or as a consultant. For purposes of this Paragraph 6,
Optionee's employment shall not be deemed to terminate by reason of sick leave,
military leave, or other leave of absence approved by the Administrator, if the
period of any such sick leave does not exceed 90 days or, if longer, if
Optionee's right to reemployment by the Company or any Affiliate is guaranteed
either contractually or by statute.

7.

Non transfer ability. This Option may not be assigned or transferred except by
will, qualified domestic relations order or by the laws of descent and
distribution, and may be exercised only by Optionee during his lifetime and
after his death, by his personal representative or by the person entitled
thereto under his will or the laws of intestate succession.

 

8.

Optionee Not a Shareholder. Optionee shall have no rights as a shareholder with
respect to the Common Stock of the Company covered by this Option until the date
of issuance of a stock certificate or stock certificates to him upon exercise of
this Option. No adjustment will be made for dividends or other rights for which
the record date is prior to the date such stock certificate or certificates are
issued.

 9.

No Right to Employment. Nothing in the Option granted hereby shall interfere
with or limit in any way the right of the Company or of any of its Affiliates to
terminate Optionee's employment or consulting at any time, nor confer upon
Optionee any right to continue in the employ of, or consult with, the Company or
any of its Affiliates.

 10.

Modification and Termination. The rights of Optionee are subject to modification
and termination in certain events as provided in Sections 4.2, 4.3, 6.3, 9.1 and
9.2 of the Plan.

 

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SETTLEMENT AND RELEASE AGREEMENT

 

 

 

 

 

EXHIBIT A - INCENTIVE STOCK OPTION AGREEMENT

 

 

11.

Restrictions on Sale of Shares. Optionee represents and agrees that, upon his
exercise of this Option, in whole or in part, unless there is in effect at that
time under the Securities Act of 1933 a registration statement relating to the
Shares issued to him, he will acquire the Shares issuable upon exercise of this
Option for the purpose of investment and not with a view to their resale or
further distribution, and that upon each exercise thereof he shall furnish to
the Company a written statement to such effect, satisfactory to the Company in
form and substance. Optionee agrees that any certificates issued upon exercise
of this Option may bear a legend indicating that their transferability is
restricted in accordance with applicable state or federal securities law. Any
person or persons entitled to exercise this Option under the provisions of
Paragraphs 3 and 4 hereof shall, upon each exercise of this Option under
circumstances in which Optionee would be required to furnish such a written
statement, also furnish to the Company a written statement to the same effect,
satisfactory to the Company in form and substance.

 12.

Plan Governs. This Agreement and the Option evidenced hereby are made and
granted pursuant to the Plan and are in all respects limited by and subject to
the express terms and provisions of the Plan, as it may be construed by the
Administrator. Optionee hereby acknowledges receipt of a copy of the Plan.

  

13.

Cash Out. In the event of a change in control in the Employer ("Change in
Control"), the Administrator may, in its discretion and upon at least ten (10)
days' advance notice to the Optionee, cancel the Option and pay to the Optionee
the value of the Option based upon the price per share of Common Stock received
or to be received by other shareholders of the Company in the event.
Notwithstanding the foregoing, if at the time of a Change in Control the
Exercise Price of the Option equals or exceeds the price paid for a share of
Common Stock in connection with the Change in Control, the Administrator may
cancel the Option without the payment of consideration therefor.

14.

Notices. All notices to the Company shall be addressed to the Chief Financial
Officer at the principal executive office of the Company, and all notices to
Optionee shall be addressed to Optionee at the address of Optionee on file with
the Company or its subsidiary, or to such other address as either may designate
to the other in writing. A notice shall be deemed to be duly given if and when
enclosed in a properly addressed sealed envelope deposited, postage prepaid,
with the United States Postal Service. In lieu of giving notice by mail as
aforesaid, written notices under this Agreement may be given by personal
delivery to Optionee or the Chief Financial Officer (as the case may be).

15.

Sale or Other Disposition. Optionee understands that, under current law,
beneficial tax treatment resulting from the exercise of this Option will be
available only if certain requirements of the Code are satisfied, including
without limitation, the requirement that no disposition of Shares acquired
pursuant to exercise of this Option be made within two years from the Grant Date
or within one year after the transfer of Shares to him or her. If Optionee at
any time contemplates the disposition (whether by sale, gift, exchange, or other
form of transfer) of any such Shares, he or she will first notify the Company in
writing of such proposed disposition and cooperate with the Company in complying
with all applicable requirements of law, which, in the judgment of the Company,
must be satisfied prior to such disposition. In addition to the foregoing,
Optionee hereby agrees that before Optionee disposes (whether by sale, exchange,
gift, or otherwise) of any Shares acquired by exercise of this Option within two
years of the Grant Date or within one year after the transfer of such Shares to
Optionee upon exercise of this Option, Optionee shall promptly notify the
Company in writing of the date and terms of the proposed disposition and shall
provide such other information regarding the Option as the Company may
reasonably require immediately before such disposition. Said written notice
shall state the date of such proposed disposition, and the type and amount of
the consideration to be received for such Shares by Optionee in connection
therewith. In the event of any such disposition, the Company shall have the
right to require Optionee to immediately pay the Company the amount of taxes (if
any) which the Company is required to withhold under federal and/or state law as
a result of the granting or exercise of the Option and the disposition of the
Shares.

 

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SETTLEMENT AND RELEASE AGREEMENT

 

 

 

 

 

EXHIBIT A - INCENTIVE STOCK OPTION AGREEMENT

 

  

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first above written.

 

 

 

SKKYNET CLOUD SYSTEMS, INC.

 

    By:

 

 

Name:

Paul E. Thomas

 

 

Title:

President and Secretary

 

 

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SETTLEMENT AND RELEASE AGREEMENT

 

 

 

 

 

EXHIBIT A - INCENTIVE STOCK OPTION AGREEMENT

 

 

SCHEDULE A

 

Pursuant to this Stock Option Agreement made as of Click here to enter a date by
and between Skkynet Cloud Systems, Inc., a Nevada corporation (the "Company"),
and ______________ ("Optionee").

 

Number of Shares; Option Price; Grant Date:

 

The Company hereby grants to Optionee the option ("Option") to purchase
beginning on ________________, upon and subject to the terms and conditions of
the Plan, ________________ shares of Common Stock of the Company ("Shares") at
the price of __________$ per share ("Exercise Price").

 

 

SKKYNET CLOUD SYSTEMS, INC.

 

    By:

 

 

Name:

Paul E. Thomas

 

 

Title:

President and Secretary

 

 

 

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