Exhibit 10.29
CONSULTING AGREEMENT with an effective date of May 31, 2002
BETWEEN: GORAN CAPITAL INC., a body politic and corporate duly incorporated,
having its head office in Toronto Canada and GRANITE REINSURANCE COMPANY LTD.,
a body politic and corporate duly incorporated, having its office at Xxxxxx'x
Court Hill, P.O. Box 111, St. Xxxxxxx, Barbados, West Indies (hereinafter
referred to as the "Companies")
AND: AGS CAPITAL LTD., a body politic and corporate duly incorporated, with
offices at 00 Xxxxx Xxxx, Xxxxxxx Xxxxxxx X00 0XX, (hereinafter referred to as
the "Consultant")
WHEREAS the Companies actively engaged internationally in the business of
insurance and reinsurance;
WHEREAS the Consultant, through its President, has expertise in the field
of insurance and reinsurance and is desirous of entering into this Agreement
with respect to providing international consulting services on demand to the
Companies as outlined in Appendix A and additional appendix as maybe attached
hereto in writing;
WHEREAS the Companies wishes to engage the services offered by the
Consultant and the Consultant is willing to enter into an agreement to provide
services on the terms and conditions described herein:
NOW, THEREFORE, BE IT AGREED AS FOLLOWS:
1. PREAMBLE
The whereas clauses mentioned above shall form an integral part of this
Agreement as it fully-recited at length herein.
2. ENGAGEMENT
2.1 The Companies hereby retains the services of the Consultant and the
Consultant hereby accepts such engagement.
2.2 During the term of this Agreement, the Consultant shall, at its sole
costs, make available to the Companies and provide upon its request a duly
qualified representative for purposes of fulfilling the Consultant's obligations
under this Agreement.
3. TERM
(A) This is an annual renewable contract, unless notice is given by either
party at least 90 days before June 1st of any year. The contract shall then
expire on the 1st of June following notice. At any time prior to the 90-day
notice period, the Company, at it's option, may choose to extend this contract
for an additional one-year term.
(B) Change of control, should Xxxxxx Xxxxxx and or Xxxxxxx Xxxxxx no longer
control the appointment of board members of Goran, and in order to cause
continuity of these very important projects, this contract shall automatically
extend for a further two year term, from the date of the last renewal.
4. NATURE OF CONSULTING SERVICES
4.1 The Consultant agrees to provide consulting services on behalf of the
Companies as and when requested by the Companies during the term of this
Agreement and, without limiting the generality of such services, to furnish a
representative to oversee and supervise the business activities outlined in
Appendix A. The essence of this contract is to utilize the experience and
knowledge of Xxxx X. Xxxxxx, his previous duties with the Companies and
personnel. Xxxx X. Xxxxxx shall be assigned as the consultant performing the
services to the Companies, however, it is understood and agreed that certain
work may be performed by others under the control of AGS Capital Ltd. At all
times, Xxxx X. Xxxxxx shall effect direct supervision over the work performed.
Any substitution of Xxxx X. Xxxxxx to perform the services being contracted for
under this agreement without the written consent of the Companies shall render
the contract null and void.
4.2 The Consultant and its representative warrant to perform such services
as requested to the best of its talents, efforts and abilities in accordance
with standard business practices.
4.3 This agreement may not be assigned by either party.
5. COMPENSATION
The Companies shall compensate the Consultant for services rendered under this
Agreement at an annual rate of FIVE HUNDRED THOUSAND dollars (U.S.) ($500,000.00
U.S.), payable in equal monthly installments, in arrears, and in each successive
calendar year of the term, the annual rate shall be increased by the greater of
(1) 2.5% or (2) the U.S. consumer price index for the immediately preceding
calendar year. The Companies shall not be responsible to the Consultant for any
ordinary operating expenses of the Consultant such as general administrative,
rent, staff, overhead, etc.
5. INSURANCE
The Companies will continue to provide for the Consultant and one assistant
to participate in the life, medical and dental plans of its subsidiary, Xxxxxx
International Group, Inc. ("SIG").
7. REIMBURSEMENT FOR OUT-OF-POCKET EXPENSES
The parties recognize that in the course of performing its services hereunder,
the Consultant may incur out-of-pocket expenses. The Consultant agrees to
submit, at designated intervals to be determined by the parties hereto, invoices
with original vouchers attached thereto, to the Companies. The Consultant
agrees that the said expenses shall be reasonable and necessary, in the opinion
of the Companies, as well as be incurred in the direct performance of its
services hereunder, failing which they may not be reimbursed to the Consultant.
8. BONUS
In addition to the forgoing, the Companies will pay a bonus immediately
upon completion of certain projects and the financial benefit to the Companies
has been received as outlined in the attached or future appendix to this
agreement.
9. INDEPENDENT CONSULTANT
9.1 It is understood that the Consultant is retained by the Companies only
for the purposes set forth herein and its relation to the Companies shall be of
an independent Consultant.
9.2 The Consultant agrees that it shall not be considered under the
provisions of this Agreement or otherwise as having a joint venture or
partnership status with the Companies or being entitled to participate in any
plans, arrangements, benefits, or distributions of the Companies.
9.3 Notwithstanding items 9.1 and 9.2, the consultant is engaged to render
services in accordance with the terms of this agreement in an expeditious and
professional manner and to keep the Companies fully informed of the status of
the matters entrusted to them for their assistance on a monthly basis.
10. CONFIDENTIALITY
As an essential condition of the Agreement, the Consultant warrants that it
shall not, at any time, either during the term of this Agreement or thereafter,
divulge to any competitor person, or competitor corporation, any information or
documentation received by it during the course of its engagement and all such
information shall be kept strictly confidential and shall not in any manner be
revealed to competitor person or competitor corporation. At the termination of
this Agreement, the Consultant agrees if requested of same to return and give to
the Companies all documentation relating to the Companies in its possession
and/or control.
11. TERMINATION
The Companies shall have the right to terminate the services hereunder of the
Consultant "for cause" at any time which shall be defined and limited to acts of
dishonesty, fraud or gross negligence of the Consultant or its representative
committed from and after the effective date of this agreement.
12. INTEREST ON MONIES DUE
Any balance due either party past due greater than 30 days shall bear
interest at 1% per month or part thereof until fully paid.
13. NOTICE
All notices called for or contemplated hereunder shall be in writing and shall
be sent by certified or registered mail or by courier to the addresses mentioned
in the heading of this Agreement. All notices will be deemed given when
received if delivered by courier, and if sent by mail then five (5) business
days after mailing. Either party may change their address by written notice to
the other party.
14. SET OFF
There shall be no right of set off against the base compensation included under
Section 5, but up to 50% of any additional compensation such as that
contemplated under Section 8 can be at the Company's option set off against
balances due the Companies.
15. ENTIRE AGREEMENT
This Agreement constitutes the entire understanding between the parties with
respect to the subject matter hereof, superseding all negotiations, previous
agreements, verbal or written, and no variation hereof shall be of any force and
effect unless reduced to writing and signed by the parties hereto.
WHEREOF, THE PARTIES HAVE SIGNED HEREIN BELOW:
GRANITE REINSURANCE COMPANY LTD. AGS CAPITAL LTD.
PER: /S/ G. XXXXXX XXXXXX PER: /S/ XXXX X. XXXXXX
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DATE: MAY 31, 2002 DATE: MAY 31, 2002
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GORAN CAPITAL, INC.
PER: /S/ XXXXXXX X. XXXXXX
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DATE: MAY 31, 2002
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WITNESS: WITNESS:
___________________________________ ___________________________
APPENDIX A
The consultant is hereby engaged for the following projects on behalf of
the Companies. The consultant shall not represent the Company with respect to
any other matters other than the following without prior written consent.
(A) The Consultant shall: Assist the management of IGF Insurance Company
with respect to the run-off of its crop insurance operations and the collection
of debts and obligations due to IGF.
(B) Manage the litigation known as AgPi. Should the litigation result in
IGF or other affiliates to IGF including but not limited to Granite Re and
Goran, being awarded compensation of a calculated value, the Consultant will be
entitled to 10% on the net proceeds over $1 million (U.S.)
(C) Manage the litigation between Toronto Dominion Bank and Granite
Insurance Company. Should the litigation result in compensation of a calculated
value, the Consultant will be entitled to a bonus of 10% on net proceeds over $1
million (CAN).
(D) At the request of the Company, the Consultant shall work with designated
representatives of the Companies to acquire or restructure outstanding trust
preferred securities due 2027 and shall not assist directly or indirectly any
other person or entity other than the Companies with respect to all matters
associated with the purchase or restructuring of the trust preferred securities.
