SERVICE AGREEMENT BETWEEN GEOVIC, LTD. AND MINERAL SERVICES, LLC. EFFECTIVE JUNE 6, 2004
Exhibit 10.3
| MINERAL SERVICES, LLC | |||
| 000 Xxxxxxxxx Xxxxxx | |||
| Xxxxxx Xxxx, XX 00000 | |||
| XXX | |||
| Tel: 0 000 000 0000 | |||
| Fax: 0 000 000 0000 | |||
SERVICE
AGREEMENT
BETWEEN
GEOVIC, LTD.
AND
MINERAL SERVICES, LLC.
EFFECTIVE JUNE 6, 2004
THE AGREEMENT:
This Agreement is entered into this 6th day of June, 2004, between Geovic Ltd. (hereinafter referred to as “Geovic”; and, Mineral Services, LLC., with its address at 000 Xxxxxxxxx Xxxxxx, Xxxxxx Xxxx, XX 00000 (hereinafter referred to as “MS”).
Whereas, MS employs its owner, Xxxxxxx Xxxxx as technical and marketing consultant; and, represents that MS has the expertise in performing the services specified herein; and,
Whereas, Geovic desires to retain the services of MS to perform services specified herein, in connection with properties, mineral resources, production, operation and marketing activities of Geovic’s Cobalt-Nickel Project in Cameroon (hereinafter Geovic’s assets).
Geovic and MS agree as follows:
SERVICE
DESCRIPTION:
The
priorities and intent under this under this agreement shall be for MS to:
| 1. | Secure funding, partners and business transactions to advance the development of Geovic’s assets. |
| 2. | Develop markets for Geovic’s products. |
| 3. | Provide technical support, innovation and efficiency to the development and operation of Geovic’s process plant and project. |
Project
Technical and Commercial Evaluation Phase:
MS
shall support, assist, and direct, as mutually agreed between Geovic and MS from
time to time in writing, including, but not limited to Geovic’s technical
and commercial evaluation, financing, project development, logistics and
marketing of products associated with Geovic’s assets. Further, MS shall,
subject to Geovic’s agreement, identify and introduce firms who may have
interest to participate in the development of Geovic’s assets. MS shall
develop and implement strategies related to the development of Geovic’s
assets where Geovic deems appropriate.
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____________________________
Email: xxxxxxx@xxxxxxxxx.xxx
| MINERAL SERVICES, LLC | |||
| 000 Xxxxxxxxx Xxxxxx | |||
| Xxxxxx Xxxx, XX 00000 | |||
| XXX | |||
| Tel: 0 000 000 0000 | |||
| Fax: 0 000 000 0000 | |||
Project
Engineering, Financing, and Development Phase:
MS’s
services, with Geovic’s support and approval, will include identification,
evaluation and recommendation of appropriate engineering and consulting firms
for project development of Geovic’s assets; identification, evaluation, and
recommendation of project staff and employees for the development and operation
of Geovic’s assets. During this phase MS will assist Geovic with the
negotiation and execution of letters of intent and final marketing agreements
for the consumption of products to be produced by Geovic’s assets; and,
project financing agreements for the development of Geovic’s assets.
MS’s services may include or be associated with: technical support, transportation, insurance, risk management programs (including hedge and derivative applications to metal prices and foreign exchange), financing and/or leasing of equipment, project funding, inventory and receivable funding, merger and acquisition funding, market evaluation, identification and introduction of consumers, negotiation of product sales or conversion agreements, drafting of product sales or conversion agreements, development of contract administration operations and training of staff required to manage contracts, treasury and banking operations, and assistance to general management functions as related to these operations.
Project
Commissioning and Operational Phase:
MS,
subject to Geovic’s agreement, will assist Geovic’s management during
the commissioning and operational implementation period and will continue in
this position subject to a period mutually agreed between MS and Geovic.
SERVICE FEE SCHEDULE:
A) Project Technical and Commercial Evaluation Phase:
| Quarterly Retainer: | US Dollars 10,000.00 (ten thousand point zero zero) per quarter, based upon time allocated to the above services of not less than 10 (ten) days per quarter (“Effective Days per Quarter”) at the unit rate of US Dollars 1, 000.00 (one thousand point zero zero) per day. Should the time demanded to perform the above services reasonably exceed 10 (ten) days per quarter, Geovic and MS shall mutually agree upon a premium for such excess time to be provided to MS. As an “Up-Front Retainer”, MS shall be granted 5,000 share options of Geovic stock based on a share price of $9.00 per share (six point zero zero dollars per share) with an exercise price of $2.25 per share (two point two five cents per share), which is 25% of the option share price and in accordance with Geovic’s current stock option plan approved by the Directors of the Company. These share options shall remain in effect for a period of ten (10) years from the date of issuance of such share options. |
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____________________________
Email: xxxxxxx@xxxxxxxxx.xxx
| MINERAL SERVICES, LLC | |||
| 000 Xxxxxxxxx Xxxxxx | |||
| Xxxxxx Xxxx, XX 00000 | |||
| XXX | |||
| Tel: 0 000 000 0000 | |||
| Fax: 0 000 000 0000 | |||
| Success Fee: | A success fee shall be earned by MS in accordance with Schedule A attached and a part hereof. |
| Travel & Expenses: | All reasonable and direct MS travel and expenses as authorized and required by Geovic to perform the above services beyond MS’s service domicile (currently within the New York City metropolitan area) shall be for Geovic’s account. |
B)
Project Engineering, Financing, and Development Phase:
The
service fees defined under (A) above, shall be applicable under this Phase B,
except that the Quarterly Retainer will be mutually agreed between MS and Geovic
to define the amount, time allocated, and applicable rate.
C) Project
Commissioning and Operational Phase:
The
service fees defined under (A) above, shall be applicable under this Phase C,
except that the Quarterly Retainer will be mutually agreed between MS and Geovic
to define the amount, time allocated, and applicable rate.
PAYMENT OF RETAINER, FEES, TRAVEL AND EXPENSES:
Quarterly
Retainer:
The
quarterly retainer shall be remitted at the end of each contractual quarter of
this Agreement to MS by Geovic through wire-transfer to MS’s designated
bank account and against MS’s telefaxed invoice (signed original invoice to
follow by post or messenger service).
Success Fee:
Success
fees as calculated above shall be remitted prior 30 days after execution and
closing of any investment, as defined above, to MS by Geovic through
wire-transfer to MS’s designated bank account and against MS’s
telefaxed invoice (signed original invoice to follow by post or messenger
service).
Travel And
Expenses:
Travel
and expenses shall be remitted promptly to MS by Geovic through wire-transfer to
MS’s designated bank account and against MS’s telefaxed invoice,
containing supporting documentation (signed original invoice to follow by post
or messenger service).
DURATION:
This
Agreement shall be effective for twelve months or 365 days from the Effective
Date herein; and, continue thereafter for additional annual periods subject to
30 (thirty ) days written notice of termination by either party but subject to
one year of “Tail Coverage” as described below. Termination of the
Agreement does not terminate the rights or interests of either party or
responsibility of either party to effect payment or perform services in
accordance with the terms and conditions of this Agreement.
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____________________________
Email: xxxxxxx@xxxxxxxxx.xxx
| MINERAL SERVICES, LLC | |||
| 000 Xxxxxxxxx Xxxxxx | |||
| Xxxxxx Xxxx, XX 00000 | |||
| XXX | |||
| Tel: 0 000 000 0000 | |||
| Fax: 0 000 000 0000 | |||
In the event Geovic enters an applicable transaction from a source initiated by MS within one year after termination, Geovic shall pay MS as “Tail Coverage” in the amounts stipulated in Section 1(B) of Schedule A. Xx. X. Xxxxxx or his designee shall document the names and dates of MS’s contacts prior to Geovic’s obligation to pay such fee.
DELIVERABLES:
MS
shall deliver a concise but complete report for each quarter during the term
hereof. Such report shall include a summary of pertinent activities and
recommendations concerning the funding, product marketing and technical/economic
aspects of processing Geovic ores.
GOVERNING
LAW:
This
agreement is constructed and shall take effect as an agreement made in
accordance with and shall be governed by the laws of the State of Colorado, USA.
ARBITRATION:
If any
disputes shall arise between the parties with respect to any of the provisions
of this Agreement or in the event that any term of this Agreement or any matter
herein contained is referred to arbitration, the party desiring the arbitration
may require same by giving written notice of arbitration to the other party. The
arbitration shall be conducted in accordance with and pursuant to the rules and
regulations of the American Arbitration Association, and provided that the costs
of such arbitration shall be borne equally between the parties to the
arbitration unless a majority of the arbitrators shall otherwise decide, and
provided further that the place of arbitration shall be in Denver, Colorado,
USA. A panel of three arbitrators shall be selected by mutual agreement from a
list provided by the American Arbitration Association.
NOTICE:
Any
notice or communication required or permitted to be given by either party
hereunder shall be deemed sufficiently given, if sent by telefax, personal hand
delivery or registered mail and addressed to the party to whom notice is given
as follows, or at such other address as may be provided in writing by one party
to the other:
Geovic: Xxxxx X. Xxxxxx
Xx. Vice President – Operations
000 Xxxxxxx Xxxxx, Xxxxx 000 X
Xxxxx Xxxxxxxx, XX 00000
Telefax (000) 000-0000
Email: xxxxxxx@xxxxxx.xxx
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____________________________
Email: xxxxxxx@xxxxxxxxx.xxx
| MINERAL SERVICES, LLC | |||
| 000 Xxxxxxxxx Xxxxxx | |||
| Xxxxxx Xxxx, XX 00000 | |||
| XXX | |||
| Tel: 0 000 000 0000 | |||
| Fax: 0 000 000 0000 | |||
MS: Xxxxxxx X.
Xxxxx
Managing Partner
000 Xxxxxxxxx Xxxxxx
Xxxxxx Xxxx, Xxx Xxxx 00000
XXX
Telefax: 1 526 747 4937
Email: xxxxxxx@xxxxxxxxx.xxx
NO
RESTRICTION ON COMPETITION:
Each
Party acknowledges that the other Party may currently or in the future be
independently developing information with the benefit of Confidential
Information disclosed by the Disclosing Party hereunder, or receiving
information that is not Confidential Information in confidence from others
having a right to make such disclosures. Such information may be similar or
competitive to the Confidential Information received under this Agreement. This
Agreement shall not be construed to imply that such Receiving Party will not
develop products or processes, for itself or others, that compete with the
products or processes described in the Disclosing Party’s Confidential
Information, provided that the Receiving Party will not in any way utilize any
of the Disclosing Party’s Confidential Information to develop such
competing products or processes.
CONFIDENTIALITY:
In
this Agreement, all information and data (“Information”), whether
given orally or in written, computer file or other permanent form, relating to
the Company, Geovic Xxxxxxx X.X. and other subsidiaries of the Company (together
the “Group”) and their businesses and assets or any part thereof
disclosed or provided to MS and all documents, computer files or other records
prepared by MS which contain or are based on any such information or data. MS
shall keep all information strictly confidential and shall not disclose the
information, in whole or in part, to any person other than directors or
employees of the Group, without the prior written consent of the Company. MS
shall not use the information for any purpose whatsoever other than for the
purpose of providing the Services.
EQUITABLE
REMEDIES:
Each
Party acknowledges that, in the event that it breaches any of its obligations
under this Agreement, the Disclosing Party may suffer irreparable harm and that
monetary damages may not be adequate to compensate the Disclosing Party for the
breach. Accordingly, each Party agrees that, in the event of a breach or
threatened breach by it or any of its Agents or any of the provisions of this
Agreement, the Disclosing Party, in addition to, and not in limitation or
derogation of, any other rights, remedies or damages available to it at law or
in equity, shall be entitled to obtain, and the Receiving Party, on behalf of
itself and its Agents, hereby consents to the granting of, a type of injunction,
specific performance, or other equitable relief in order to prevent, restrain or
remedy such breach or to prevent any further breach. The Parties hereby waive
any requirement for the posting of bond or other security in connection with the
granting to the Disclosing Party of such injunctive relief.
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____________________________
Email: xxxxxxx@xxxxxxxxx.xxx
| MINERAL SERVICES, LLC | |||
| 000 Xxxxxxxxx Xxxxxx | |||
| Xxxxxx Xxxx, XX 00000 | |||
| XXX | |||
| Tel: 0 000 000 0000 | |||
| Fax: 0 000 000 0000 | |||
ENUREMENT - NO
ASSIGNMENT:
The
provisions hereof shall enure to the benefit of the successors of the Parties
hereto and their permitted assigns. This Agreement shall not be assignable, in
whole or in part, by either Party without the prior written consent of the other
Party, which consent shall not be unreasonably withheld.
ENTIRE
AGREEMENT:
This
Agreement contains the entire agreement and understanding between the Parties
hereto with respect to the subject matter hereof, and merges and supersedes all
prior discussions and writing with respect thereto. No modifications or
alterations of the Agreement shall be effective unless made in writing and
signed by both Parties hereto.
IN WITNESS WHEREOF the Parties hereto have executed this Agreement effective as if the date first above written.
Geovic, Ltd.:
Per: /s/ Xxxxx Xxxxxx
Xxxxx Xxxxxx/Sr. Vice President Operations
MINERAL SERVICES, LLC.
Per: /s/ Xxxxxxx Xxxxx
Xxxxxxx Xxxxx/Managing Partner
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____________________________
Email: xxxxxxx@xxxxxxxxx.xxx
| MINERAL SERVICES, LLC | |||
| 000 Xxxxxxxxx Xxxxxx | |||
| Xxxxxx Xxxx, XX 00000 | |||
| XXX | |||
| Tel: 0 000 000 0000 | |||
| Fax: 0 000 000 0000 | |||
Schedule A
In the event Geovic, at its sole discretion, consummates a joint venture, sale or similar business transaction with any third Party; or accepts debt, public or private placement of equity or other funds, or investments from any third Party based on the efforts and contacts initiated or arranged by MS, Geovic shall pay fees to MS a “Finders/Success Fee” for each event based on the following schedule:
| Finders/Success Fee |
Amount of Funds Secured or | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Share | Invested in the Company | ||||||||||||||||||
| Level | US $ |
+ |
% |
+ |
Options* |
or Project (US$) ** |
|||||||||||||
| I | 0. | + | 3 | .00 | + | 2,500 | up to 500,000. | ||||||||||||
| II | 15,000. | + | 1 | .50 | + | 5,000 | from 500,000. to 3,500,000. | ||||||||||||
| III | 60,000. | + | 0 | .75 | + | 7,500 | from 3,500,000. to 10,000,000. | ||||||||||||
| IV | 108,750. | NA | + | 10,000 | greater than 10,000,000 | ||||||||||||||
* These share options will have an exercise price of twenty-five percent (25%) of the then prevailing price of Geovic shares or higher percentages as may be mandated by regulatory authorities or per changes in Geovic’s option plan approved by the Directors for all Geovic employees. The options shall remain in effect for a period of ten (10) years from the date of issuance of such share options. The levels above include accumulated payments for the four numerals. |
** Amounts invested means all cash received or value of all shares issued to Geovic and all work expenditures (whether contractually required or not) incurred on the Project by any Party brought in by MS. |
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Email: xxxxxxx@xxxxxxxxx.xxx
