CONSULTING SERVICES AGREEMENT
Exhibit
99.2
This
Consulting Services Agreement (the "Agreement") is made this
20th day of
June, 2007, with effect as of April 16, 2007 (the "Effective
Date"), by and between Xxxxxxxxx Inc. ("Xxxxxxxxx"),
G. Xxxxxx Xxxxxxxx ("Xxxxxxxx") and VC & Co. Incorporated
("VC").
Recitals:
X. Xxxxxxxxx
has requested VC to provide it with certain services; and
B. VC
will provide the services to Xxxxxxxxx on the terms set forth
below.
For
and
in consideration of the premises and mutual covenants in this Agreement,
Xxxxxxxxx, Xxxxxxxx and VC agree as follows:
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1.
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Services
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1.1
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During
the term of this Agreement, VC will provide certain services (the
"Executive Services") to Xxxxxxxxx through Xxxxxxxx, who
will serve as Chief Executive Officer of Xxxxxxxxx
("CEO") reporting directly to its board of directors
(the
“Board”). The Executive Services to be
provided are defined in Sections 1.2(a) to (f) below. Xxxxxxxx
will also remain a member of the Board. Xxxxxxxx will be
employed solely by VC and he will not be entitled to receive any
remuneration directly from Xxxxxxxxx, other than the Options as described
in Section 5.1 of this Agreement.
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1.2
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Xxxxxxxx
will have primary executive responsibility at
Xxxxxxxxx:
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(a)
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to
supervise all legal, regulatory and similar proceedings and investigations
and related matters in which Xxxxxxxxx (or any of its wholly-owned
subsidiaries) are involved;
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(b)
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to
negotiate and arrange a Noteholder
Resolution;
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(c)
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to
negotiate a resolution of outstanding issues between Xxxxxxxxx and
Sun-Times Media Group, Inc. ("Sun
Times");
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(d)
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to
negotiate and arrange, if possible, a financing to provide Xxxxxxxxx
with
additional liquidity and working
capital;
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(e)
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to
exert Xxxxxxxxx'x and its subsidiaries' influence, as necessary and
appropriate, to cause or encourage Sun Times to take such actions
as are
necessary to improve its operational performance including, to the
extent
required, effecting a reconstitution of the board of directors of
Sun
Times; and
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(f)
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for
such additional responsibilities as may be assigned by the Board
from time
to time.
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1.3
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Xxxxxxxx
shall devote as much of his working time and effort as is necessary
to
properly and responsibly provide the Executive Services hereunder
and
shall use his best efforts to promote Xxxxxxxxx'x
interests.
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1.4
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Xxxxxxxxx
acknowledges and agrees that Xxxxxxxx has other professional and
business
commitments which he will be obliged and permitted to continue during
the
term of this Agreement and that Xxxxxxxx may continue to provide
services
to third parties during the term of this
Agreement.
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1.5
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Nothing
in this Agreement shall create or confer upon the parties hereto,
in any
way or for any purpose, any relationship except that of contracting
parties, and in particular this Agreement does not create an
employer-employee relationship between Xxxxxxxxx and Xxxxxxxx or
between
Xxxxxxxxx and any other of VC's
employees.
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2.
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Other
Conditions
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2.1
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Notwithstanding
any other provision in this Agreement, the parties agree that Xxxxxxxx
and
VC and their affiliates, including Xxxxxxxx & Co. LLP, and any of the
individuals employed by or partners of any of them
will:
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(a)
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terminate
all retainers that any of them has with The Catalyst Capital Group
Inc.,
any of its affiliates or any existing or future funds managed by
it or any
of its affiliates, including but not limited to, Catalyst Fund General
Partner I Inc. (collectively, "Catalyst");
and
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(b)
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not
accept any retainers from Catalyst while VC provides the Executive
Services to Xxxxxxxxx during the term of this
Agreement.
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3.
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Term
of this Agreement
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3.1
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This
Agreement is effective as of the Effective Date and will terminate
in
accordance with Section 9.
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4.
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Base
Monthly Fees and Milestone
Fees
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4.1
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Xxxxxxxxx
will pay VC, for the Executive Services, a fee of $75,000 per month
(the
"Base Monthly Fee") from the Effective Date of this
Agreement until its termination, due and payable in advance on the
first
day of each calendar month commencing in respect of the month of
May 2007.
VC shall also be entitled to a pro rated Base Monthly Fee of $37,500
for
April 2007.
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4.2
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Xxxxxxxxx
will also pay VC certain fees in relation to achieving substantial
completion of certain matters ("Milestone Fees") as
described below:
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(a)
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upon
substantial completion of the matters referred to in Section 1.2(b)
of
this Agreement, a Milestone Fee equal to $1.2
million;
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(b)
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provided
substantial completion of the matters referred to in Section 1.2(b)
of
this Agreement has been achieved, an additional Milestone Fee equal
to
$1.4 million upon the first to be completed
of:
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(i)
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the
sale or other disposition by Xxxxxxxxx and its wholly-owned subsidiaries
of substantially all of their shares of Sun
Times;
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(ii)
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a
transaction, supported by the Board, involving the sale or other
disposition of a majority of the outstanding common shares (or other
equity-like securities) of Xxxxxxxxx;
or
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(iii)
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the
sale or other disposition of all or substantially all of the assets
of
either Sun Times or Xxxxxxxxx (provided, for greater certainty, that
a
sale or other disposition does not include any charge or pledge of
shares
or assets, including in respect of a refinancing of the Senior Notes
including any financing for Xxxxxxxxx necessary to allow such refinancing
to occur); and
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(c)
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upon
substantial completion of any matter referred to in Section 1.2,
other
than the matters described in Sections 1.2(b) or (c), or in the
circumstances where one of the matters contemplated by Sections 4.2(b)(i),
(ii) or (iii) occurs prior to substantial completion of the matters
referred to in Section 1.2(b), an additional Milestone Fee in an
amount
that is fair and reasonable in the
circumstances.
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4.3
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The
amount of each Milestone Fee payable under Section 4.2(c) shall be
a
function of:
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(a)
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the
nature and extent of the success, if any, achieved by Xxxxxxxxx in
connection with the matter or transaction giving rise to such
payment;
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(b)
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the
importance to Xxxxxxxxx of such matter or
transaction;
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(c)
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the
circumstances in which any such success was achieved;
and
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(d)
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such
other factors as the Board and VC may agree are relevant to the
determination.
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4.4
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Each
Milestone Fee will be due and payable within ten business days of
substantial completion of the matter or transaction for which the
Milestone Fee is being paid.
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4.5
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In
addition to the fees provided for in Sections 4.1 and 4.2, Xxxxxxxxx
will
pay VC, upon execution of this Agreement, a Milestone Fee of $169,500
for
matters accomplished by Xxxxxxxx during the period from January 15,
2007
to the Effective Date.
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5.
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Stock
Options and Other
Compensation
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5.1
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The
grant of stock options (the "Options") on May 7, 2007 by
Xxxxxxxxx to Xxxxxxxx under Xxxxxxxxx'x Executive Share Option Plan,
amended and restated as of September 13, 1994, further amended as
of
December 3, 1996 and as modified by the terms of the share option
agreement dated as of May 7, 2007 between Xxxxxxxxx and Xxxxxxxx
(the
"Option Agreement"), each of which are attached hereto as
Schedule "A", to purchase up
to an aggregate of 1,000,000 Xxxxxxxxx common shares at an exercise
price
equal to $0.70 per share, which was conditional upon the execution
of this
Agreement, shall be
effective.
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5.2
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In
the event that, during the twelve months following January 15, 2007,
Xxxxxxxxx issues additional common shares or securities which are
convertible into, carry the right to receive or provide Xxxxxxxxx
with the
right to issue (directly or indirectly) additional common shares
of
Xxxxxxxxx (or other equity-like securities) (a "Specified
Financing"), VC shall thereafter be entitled, at the time
Xxxxxxxx exercises any of the Options, to receive a
cash payment from Xxxxxxxxx (the "Cash Settlement
Amount"), as described in Section 5.3, multiplied times the
number of Options so exercised on that date. For greater
certainty, VC's entitlement to this Cash Settlement Amount shall
be in
addition to Xxxxxxxx' right to receive the number of common shares
of
Xxxxxxxxx issuable upon the exercise of such
Options.
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5.3
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With
respect to Options exercised on any particular date (the "Exercise
Date"), the Cash Settlement Amount shall be the amount that
results from the following formula:
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(A
x
(B-C)) – (D x (E-F))
D
where:
A
equals
the number of common shares (or other equity-like securities) of Xxxxxxxxx
(the
“Post-Financing Underlying Securities”) that would have been held by Xxxxxxxx
had Xxxxxxxx previously been issued and thereafter fully and completely
exercised, in lieu of the Options, replacement options to acquire 3% of the
outstanding common shares (or equity-like securities) of Xxxxxxxxx calculated
on
a fully-diluted basis after giving effect to the issuance of all additional
common shares or other equity-like securities issued or issuable in connection
with all Specified Financings undertaken prior to the Exercise
Date;
B
equals
the market price of the Post-Financing Underlying Securities calculated as
of
the close of business on the Exercise Date;
C
equals
the lowest of (i) the market price of the Post-Financing Underlying Securities
immediately following the completion of any Specified Financing undertaken
prior
to the Exercise Date and (ii) the price at which the Post-Financing Underlying
Securities are issued or issuable in connection with any such Specified
Financing;
D
equals
1,000,000, being the number of Options;
E
equals
the market price of the common shares of Xxxxxxxxx calculated as of the close
of
business on the Exercise Date; and
F
equals
$0.70, being the exercise price of the Options.
For
greater certainty, in the event that there exists more than one type of
Post-Financing Underlying Security as of any Exercise Date, the calculation
of
(A x (B-C)) contemplated within the above formula shall be done separately
for
each type of Post-Financing Underlying Security (as if the 3% replacement
options notionally issued to Xxxxxxxx were held in proportion to the number
of
each type of Post-Financing Underlying Securities issued or issuable by
Xxxxxxxxx) with the cumulative sum of such calculations being the value used
for
(A x (B-C)) within such formula. Further, in the event that no
published market exists for a particular security at a relevant date
contemplated by the above formula, the market value of that security shall
be
deemed to be the fair market value thereof on the relevant date, and Xxxxxxxxx
and VC shall work in good faith to agree within seven days of the relevant
date
upon such fair market value. The parties also agree that, in
connection with any Specified Financing, they will work in good faith to confirm
the impact of the Specified Financing on any subsequent calculation of the
Cash
Settlement Amount in a manner that gives effect to the purpose and intent of
this Section 5.
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6.
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Indemnity
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6.1
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Xxxxxxxx
shall be provided with an indemnity from Xxxxxxxxx in the form currently
provided to him.
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7.
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Reimbursement
of Expenses and Taxes
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7.1
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Xxxxxxxxx
will reimburse VC for: (a) all reasonable expenses incurred by Xxxxxxxx
or
VC in providing the Executive Services, including, but not limited
to,
travel and lodging expenses and communication charges, and (b) any
legal
fees that Xxxxxxxx or VC may reasonably incur arising out of or in
connection with this Agreement from and after the date upon which
it is
executed, including with respect to the validity or enforceability
of, or
liability under, any provision of this Agreement or any action by
VC to
enforce its rights hereunder.
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7.2
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Xxxxxxxxx
will pay for all taxes in connection with the provision of the Executive
Services in this Agreement including, but not limited to, sales,
use,
excise, value-added, goods and services, consumption, and other similar
taxes or duties. For greater certainty, and without limiting
the generality of the foregoing, an additional amount equal to any
applicable federal Goods and Services Tax and any applicable provincial
sales tax will be charged to and payable by Xxxxxxxxx in respect
of all
payments to VC hereunder. Each party will be
responsible for
taxes based on its own net income, employment taxes of its own employees,
and for taxes on any property it owns or
leases.
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8.
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Other
Services
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8.1
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Upon
Xxxxxxxx' recommendation, Xxxxxxxxx may also retain VC or any of
its
affiliates (including Xxxxxxxx & Co. LLP) to obtain the services of
other partners or employees of VC or any of its affiliates to provide
assistance to Xxxxxxxxx in connection with Xxxxxxxxx'x business and
affairs (the "Other Services"). VC and its
affiliates will not provide the Other Services to Xxxxxxxxx unless
prior
notice of the nature and scope of such Other Services has been provided
to
the Chairman of the Board, and the Chairman of the Board does not
object
to such Other Services being provided. For greater certainty,
Xxxxxxxx will not provide Other Services to
Xxxxxxxxx. Notwithstanding any other provision in this
Agreement, the parties agree that the Chairman of the Board shall
be
unilaterally entitled at any time, for any and no reason, to terminate
the
provision of the Other Services. If the Other Services are
terminated, VC and its affiliates will not be entitled to any further
fees
other than those accrued to the time of
termination.
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8.2
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Xxxxxxxxx
will pay VC or its affiliates, for Other Services, fees based on
the usual
hourly rates of the partners and employees of VC or its affiliates
providing the Other Services, and accounts for such Other Services
shall
be sent to the Chairman of the Board for
approval.
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9.
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Termination
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9.1
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This
Agreement will immediately terminate upon the death of
Xxxxxxxx.
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9.2
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Xxxxxxxxx
may also terminate this Agreement if Xxxxxxxx suffers a physical
or mental
disability that prevents VC from providing the Executive Services
for a
period of sixty days, whether or not consecutive and that is, in
the
opinion of a duly qualified medical practitioner selected by Xxxxxxxxx,
likely to continue to the same degree for a further period of more
than 30
days (a “Disability”). Xxxxxxxx agrees to
submit to any reasonably required medical examination by such practitioner
for the purposes of this Section 9.1 and that such medical practitioner
may reveal the results of such medical examination to
Xxxxxxxxx.
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9.3
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Xxxxxxxxx
may also terminate this Agreement at any time for Sufficient
Cause.
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9.4
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Xxxxxxxxx
may also at any time, by written notice, immediately terminate this
Agreement other than for Sufficient Cause or
Disability.
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9.5
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VC
may terminate this Agreement at any time for Good
Reason.
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9.6
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If
this Agreement terminates pursuant to Section 9.1 or is terminated
by
Xxxxxxxxx pursuant to Section 9.2,
then:
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(a)
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VC
will cease to be entitled to any further payments under Section 4
and, in
lieu thereof, will be entitled to immediate payment of that amount
in
relation to unpaid Milestone Fees described in Section 4.2 that could
reasonably be considered to have been earned, prior to the termination
of
this Agreement, based upon the degree of success achieved and/or
the
progress made by Xxxxxxxxx with respect to the relevant matters or
transactions up to the date of such termination;
and
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(b)
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if
such termination occurs prior to the date which is 18 months following
the
Effective Date, notwithstanding the terms of the Option Agreement,
Xxxxxxxx shall cease to be entitled to exercise any Options on that
date
which is 120 days following the termination of this Agreement (with
any
Options that remain unexercised following such 120th
day being
forfeited and, for greater certainty, VC ceasing to be entitled to
any
Cash Settlement Amount(s) in respect of such unexercised
Options).
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9.7
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If
this Agreement is terminated by Xxxxxxxxx pursuant to Section 9.3
or is
terminated by VC other than for Good Reason, then VC will not be
entitled
to any further Base Monthly Fees,
Milestone Fees, Cash Settlement Amount(s) and, notwithstanding the
terms
of the Option Agreement, Xxxxxxxx shall forfeit all unexercised
Options.
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9.8
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If
this Agreement is terminated by Xxxxxxxxx pursuant to Section 9.4,
other
than following a Change of Control or in circumstances where it is
reasonably demonstrated that such termination was a Change of Control
Termination, then VC will cease to be entitled to any further payments
under Section 4 and, in lieu thereof, will be entitled to immediate
payment of an amount equal to the aggregate
of:
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(a) nine
times the Base Monthly Fee; and
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(b)
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that
amount in relation to unpaid Milestone Fees described in Section
4.2 that
could reasonably be considered to have been earned, prior to the
written
notice of termination of this Agreement, based upon the degree of
success
achieved and/or the progress made by Xxxxxxxxx with respect to the
relevant matters or transactions up to the date of such
termination.
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9.9
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If
VC terminates this Agreement pursuant to Section 9.5, or if Xxxxxxxxx
terminates this Agreement pursuant to Section 9.4 following a Change
of
Control or in circumstances where it is reasonably demonstrated that
such
termination was a Change of Control Termination, then VC will cease
to be
entitled to any further payments under Section 4 and, in lieu thereof,
will be entitled to immediate payment of an amount equal to the aggregate
of:
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(a)
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twelve
times the Base Monthly Fee;
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(b)
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if
the Milestone Fees described in Sections 4.2(a) and (b) have not
both been
paid in full, an amount equal to $1.6 million less any amounts previously
paid in respect of such Milestone Fees;
and
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(c)
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that
amount in relation to unpaid Milestone Fees described in Section
4.2(c)
that could reasonably be considered to have been earned, prior to
the
termination of this Agreement, based upon the degree of success achieved
and/or the progress made by Xxxxxxxxx with respect to the relevant
matters
or transactions up to the date of such
termination,
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provided
that, if the relevant Change of Control resulted from a refinancing of the
Senior Notes (including any financing for Xxxxxxxxx necessary to allow such
refinancing) in respect of which the Milestone Fee described in Section 4.2(a)
has been or will be paid, VC shall be entitled to receive, in lieu of the amount
described in Section 9.9(b), an amount in relation to the Milestone Fee
described in Section 4.2(b) that could reasonably be considered to have been
earned, prior to the termination of this Agreement, based upon the degree of
success achieved and/or the progress made by Xxxxxxxxx with respect to the
matters contemplated by Section 4.2(b) up to the date of such
termination.
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9.10
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For
greater certainty, no amount shall be payable pursuant to Section
9.9 in
the event this Agreement is terminated after substantial completion
of all
matters referred to in Sections 4.2(a), (b) and (c) for which Milestone
Fees have been paid or are payable (or in connection
with completing the final such matter for which a Milestone Fee is
otherwise payable
hereunder).
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9.11
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Xxxxxxxx’
rights to continue to hold and exercise the Options in accordance
with the
Option Agreement and VC’s rights to receive the Cash Settlement Amount
upon any exercise of the Options by Xxxxxxxx shall survive, and remain
in
force unaffected by, any termination of this Agreement, except: (a)
a
termination by Xxxxxxxxx for Sufficient Cause, (b) a termination
by VC
other than for Good Reason, or (c) a termination, prior to the date
which
is 18 months following the Effective Date, upon Xxxxxxxx’ death or
Disability. Further, no termination of this Agreement for any
reason shall affect or alter any of Xxxxxxxxx’x obligations under Section
6 (Indemnity) or Section 7 (Reimbursement of Expenses and
Taxes).
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10.
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General
Provisions
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10.1
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This
Agreement will be binding upon the parties and their respective
successors, permitted assigns, heirs, executors, administrators and
other
legal representatives. Each party is prohibited from assigning
this Agreement to any person without first obtaining the written
consent
of the other parties and any assignment without consent is null and
void. Xxxxxxxxx shall require any successor (whether direct or
indirect, by purchase, amalgamation, arrangement, merger, consolidation
or
otherwise) to all or substantially all of the business and/or assets
of
Xxxxxxxxx to assume expressly and agree to perform this Agreement
in the
same manner and to the same extent that Xxxxxxxxx would be required
to
perform it if no such succession had taken place. As used in
this Agreement, “Xxxxxxxxx” shall mean Xxxxxxxxx (as herein defined) and
any successor to its business and/or assets as aforesaid which assumes
and
agrees to perform this Agreement by operation of law or
otherwise.
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10.2
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Nothing
in this Agreement shall prevent Xxxxxxxx from resigning as a director
of
Xxxxxxxxx at any time.
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10.3
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Xxxxxxxxx’x
obligations to make the payments provided for in this Agreement and
otherwise to perform its obligations hereunder shall not be affected
by
any set-off, counterclaim, defence or other claim, right or action
which
Xxxxxxxxx may have or may allege to have against Xxxxxxxx or VC or
others.
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10.4
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Whenever
this Agreement requires or contemplates any action, consent or approval
by
a party, such party will act reasonably and in good
faith.
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10.5
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The
parties agree that, in the event of a dispute or alleged breach,
they will
first work together in good faith to resolve the matter as between
themselves and, then if necessary, to use a mutually agreed alternative
dispute resolution technique prior to resorting to
litigation. In the event the parties fail to mutually agree
upon such technique within thirty days after good faith attempts
at
resolution have failed, either party may resort to
litigation.
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10.6
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This
Agreement and the Option Agreement contain the entire agreement between
the parties with respect to the subject matter hereof and thereof
and
supersedes all prior agreements, negotiations, representations and
proposals, written and oral, relating to their subject
matter. The terms of this Agreement will not be modified
subsequently except by a written agreement signed by all parties.
No
waiver of any provision of this Agreement is binding unless it is
in
writing and signed by all parties to this Agreement entitled to grant
the
waiver. No failure to exercise, and no delay in exercising, any right
or
remedy, under this Agreement will be deemed to be a waiver of that
right
or remedy. No waiver of any breach of any provision of this
Agreement will be deemed to be a waiver of any subsequent breach
of that
provision.
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10.7
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Each
party will from time to time promptly execute and deliver all further
documents and take all further action necessary or appropriate to
give
effect to the provisions of this
Agreement.
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10.8
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Each
party agrees that, in its respective dealings with the other parties
under
or in connection with this Agreement, it will act in good
faith.
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10.9
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This
Agreement will in all respects be governed by, subject to, interpreted
and
enforced exclusively in accordance with the laws of the Province
of
Ontario and the laws of Canada applicable therein. Each of the parties
irrevocably submits to the non-exclusive jurisdiction of the courts
of the
Province of Ontario.
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10.10
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If
any provision of this Agreement is or becomes illegal, invalid
or
unenforceable in any jurisdiction, the illegality, invalidity
or
unenforceability of that provision will not affect the legality,
validity
or enforceability of the remaining provisions of this Agreement;
or the
legality, validity or enforceability of that provision in any
other
jurisdiction.
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10.11
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Any
notice, demand or other communication required or permitted
to be given
under this Agreement will be in writing and will be delivered
by hand or
courier or by confirmed facsimile, in each case to the address
of such
party set forth below:
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if
to Xxxxxxxxx:
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000
Xxxxxxxx Xxxxxx Xxxx, Xxxxx 000
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Xxxxxxx,
XX
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X0X
0X0
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Attention:
Chief Financial Officer
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Fax:
000-000-0000
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if
to Voorheis or
VC:
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000
Xxxxxxxx Xxxxxx Xxxx, Xxxxx 000
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Xxxxxxx,
XX
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X0X
0X0
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Attention:
Xxx Xxxxxxxx
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Fax:
000-000-0000
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10.12
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All
references to dollars in this Agreement are to Canadian
dollars.
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10.13
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For
every provision of this Agreement, time is of the
essence.
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11.
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Certain
Defined Terms
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For
the
purposes of this Agreement, the following terms will be defined as
follows:
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(a)
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“Change
of Control” means the occurrence, on or after August 15, 2007, of
any of the following events:
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(i)
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the
acquisition by any person or group of persons acting jointly or in
concert, or persons associated or affiliated within the meaning of
the
Canada Business Corporations Act with any such person or group,
other than Catalyst or RSM Xxxxxxx Inc. and their respective subsidiaries,
affiliates and associates, of beneficial ownership or control and
direction over 25% of more of the outstanding common shares or other
equity-like securities of Xxxxxxxxx (or the right or obligation,
whether
or not on conditions, to acquire such common shares or other securities
including through the ownership of securities which are convertible
into,
carry the right to receive or provide Xxxxxxxxx with the right to
issue,
directly or indirectly, such common shares or other equity-like
securities);
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(ii)
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the
individuals who were elected to the Board at Xxxxxxxxx’x shareholders’
meeting on May 7, 2007 ceasing to constitute a majority of the
Board;
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(iii)
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a
sale or other disposition of all or substantially all of the assets
of
Xxxxxxxxx; or
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(iv)
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the
appointment, other than at the behest of the Board, of any receiver,
trustee, administrator, monitor or other substantially similar appointment
in respect of Xxxxxxxxx or its assets and
undertakings.
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(b)
|
“Change
of Control Termination” means a termination of this Agreement by
Xxxxxxxxx that either (i) was at the request of a third party who
has
taken steps reasonably calculated to effect a Change of Control,
or (ii)
otherwise arose in connection with or anticipation of a Change of
Control.
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(c)
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“Good
Reason” means the occurrence of any of the following, after a
Change of Control, without VC’s written consent (except in connection with
the termination of this Agreement for Sufficient Cause or a as a
result of
Disability):
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|
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(i)
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a
material adverse change in Xxxxxxxx’ position or duties or
responsibilities (including, without limitation, to whom Xxxxxxxx
reports
and who reports to Xxxxxxxx) or title;
or
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10 -
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(ii)
|
the
good faith determination by Xxxxxxxx that, as a result of the Change
of
Control or any action or event thereafter, Xxxxxxxx’ status or
responsibility at Xxxxxxxxx or its subsidiaries has been materially
diminished or Xxxxxxxx is being effectively prevented from carrying
out
his duties and responsibilities as they existed immediately prior
to the
Change of Control; or
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(iii)
|
the
failure by Xxxxxxxxx to obtain, in a form satisfactory to VC, acting
reasonably, an effective assumption of Xxxxxxxxx’x obligations hereunder
by any successor to Xxxxxxxxx referred to in Section
10.1;
|
provided
that, for purposes of this Section 11(c), notwithstanding anything in this
Agreement to the contrary, a termination of this Agreement by VC for any reason
whatsoever (and whether or not any event referred to in Section 11(b)(i), (ii)
or (iii) above has occurred) during the three month period commencing on the
date that is 90 days immediately following the date on which a Change of Control
occurs shall be deemed to be a termination of this Agreement for “Good Reason”
for all purposes of this Agreement.
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(d)
|
“Noteholder
Resolution” means a refinancing of the Senior Notes, including
any financing for Xxxxxxxxx necessary to allow such refinancing to
occur,
or other transaction (including a redemption or other repayment)
or
agreement which has the effect of waiving, curing or otherwise eliminating
the existing events of default under the Senior Notes (including
an
agreement by the holders of a majority of the Senior Notes to forbear
in
respect of such events of default) or any other consensual resolution
of
outstanding issues with the holders of the Senior Notes (which, for
greater certainty, shall include a circumstance where one of the
matters
contemplated by Sections 4.2(b)(i), (ii) or (iii) occurs prior to
the
holders of the Senior Notes enforcing their rights under the Senior
Notes).
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|
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(e)
|
“Senior
Notes” means the U.S. $78 million principal amount of 11.875%
senior secured notes due 2011 issued by Xxxxxxxxx on or about March
10,
2003 and the U.S. $15 million of 11.875% senior secured notes due
2011
issued by Xxxxxxxxx on or about September 30,
2004.
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(f)
|
“Sufficient
Cause” means:
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|
|
(i)
|
a
wilful criminal act of theft or dishonesty by Xxxxxxxx in the performance
of the Executive Services;
|
|
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(ii)
|
a
material breach by VC of its obligations under this Agreement which
is not
cured within 10 days of written notification to VC from
Xxxxxxxxx;
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(iii)
|
a
breach by VC or any of its affiliates of Section 2.1;
or
|
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|
(iv)
|
notwithstanding
Section 1.4, the Board, acting reasonably, having concluded that
Xxxxxxxx
is not devoting sufficient time to Xxxxxxxxx with
Xxxxxxxx failing to remedy that circumstance within a reasonable
period of
time after Xxxxxxxxx provides him with written notice
thereof.
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11 -
The
parties have executed this Agreement as of the date first indicated above,
and
this Agreement shall be effective as of April 16, 2007.
|
XXXXXXXXX
INC.
|
|||
|
|
By:
|
/s/ Xxxxxxx Xxxx | |
| Name: Xxxxxxx Xxxx | |||
| Title: Chairman of the Board | |||
|
VC
& CO. INCORPORATED
|
|||
|
|
By:
|
/s/ G. Xxxxxx Xxxxxxxx | |
| Name: G. Xxxxxx Xxxxxxxx | |||
| Title: Managing Director | |||
|
|
|
/s/
G. Xxxxxx Xxxxxxxx
|
|
|
G.
Xxxxxx Xxxxxxxx
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|||
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