Exhibit 10.3
Consulting Agreement between Cool Management Inc. and Xxxxxxx Xxxxx Xxxx
dated March 1, 1999
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CONSULTING AGREEMENT
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THIS AGREEMENT dated for reference March 1, 1999
BETWEEN
COOL MANAGEMENT INC., a company incorporated under the laws of
British Columbia having its registered office at 0000-000 Xxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
(the "Company");
AND
XXXXXXX XXXXX XXXX, who resides at 0000 Xxxxx Xxxxxxxx, Xxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
(the "Consultant").
WHEREAS:
A. The Company is party to a management contract (the "Management
Agreement") between the Company and Cool Entertainment, Inc. ("Cool
Entertainment"), a Washington corporation which intends to carry on the business
of internet sales of audio and visual products; and
B. The Company wishes to retain the Consultant to provide certain
consulting services on the terms and conditions contained in this Agreement.
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the mutual
covenants and agreements herein contained the Parties agree as follows:
1. INTERPRETATION
1.1 In this Agreement the following terms shall have the meaning
set out below:
(a) "AGREEMENT" means this consulting agreement as amended and
supplemented from time to time;
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(b) "BOARD" means the board of directors of the Company;
(c) "BUSINESS DAY" means any day other than Saturday, Sunday or a
statutory holiday in British Columbia;
(d) "CONSULTING FEES" has the meaning given in Article 4;
(e) "CONSULTING SERVICES" means such advice, assistance and
services with respect to such matters as the Company may
reasonably prescribe from time to time;
(f) "PARTIES" means parties to this Agreement, and "PARTY" means
any one of them; and
(g) "TERM" has the meaning given in Article 3.
1.2 GOVERNING LAW
This Agreement shall be governed by and be constructed in accordance with the
laws of the Province of British Columbia and laws of Canada applicable in the
Province of British Columbia.
1.3 SEVERABILITY
If any one or more of the provisions contained in this Agreement should be
determined to be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
1.4 ENUREMENT
This Agreement shall enure to the benefit of and be binding on the Parties and
their respective heirs, successors, personal representatives and permitted
assigns.
1.5 HEADINGS
The headings in this Agreement are inserted for convenience only and shall not
affect the interpretation of this Agreement.
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2.0 CONSULTING SERVICES
The Company hereby retains the Consultant, on a non-exclusive basis, to provide
to the Company the Consulting Services as requested by the Company, acting
reasonably, from time to time.
3.0 TERM
The term of this Agreement (the "Term") shall commence on the day Chelsea
Pacific Financial Corp. ("Chelsea") meets the First Financing Milestone, as that
term is defined in Section 7.1(a) of the Escrow Agreement between Pacific
Corporate Trust Company, Cool Entertainment, Chelsea, Minas Novas Gold Corp.
(the "U.S. Company") and Xxxxxxx Kar Man Xxx, Xxxxxxx Xxxxx Xxxxxxx, Xxxxxxx
Xxxxx Xxxx and Xxxx Xxxxxxx Xxxxxxxx (Lau, Hadcock, Xxxx and Belcourt are herein
collectively referred to as the "Vendors") of even date herewith (the "Escrow
Agreement"), and ending on that day (the "Expiry Date") which is the earlier of:
(a) one year from the day on which Chelsea meets the Fourth
Financing Milestone (as defined in Section 7.1(d) of the
Escrow Agreement); and
(b) the day the Vendors become entitled to terminate Chelsea's
right of first refusal provided in Section 7 of the Amendment
and Restatement between Chelsea, the Vendors, Cool
Entertainment and the U.S. Company of even date herewith (the
"Amendment and Restatement") pursuant to Section 7.4(h)(i) of
the Escrow Agreement.
4.0 REMUNERATION FOR CONSULTING SERVICES
As remuneration for the Consulting Services, the Company will pay to the
Consultant a fee of US$25,000 per year commencing on the commencement of the
Term (the "Consulting Fees").
5.0 CONFIDENTIAL INFORMATION
5.1 CONFIDENTIALITY
The Consultant acknowledges that during the Term, the Consultant will:
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(a) have access to and will be entrusted with detailed
confidential information, know-how and trade secrets relating
to the business and affairs of the Company, Cool Entertainment
and the U.S. Company including, without limitation, finances,
products, services, dealings and transactions of Cool
Entertainment and the U.S. Company, and the names, addresses,
preferences or other particular business requirements of Cool
Entertainment's and the U.S. Company's customers
("Confidential Information"), and that the disclosure of
Confidential Information to competitors of the Company, Cool
Entertainment or the U.S. Company or to the public would be
highly detrimental to the best interests of the Company, Cool
Entertainment and the U.S. Company;
(b) in the course of performing services hereunder, the Consultant
will be one of the principal representatives of Cool
Entertainment and the U.S. Company and as such will be
significantly responsible for maintaining or enhancing the
goodwill of Cool Entertainment and the U.S. Company; and
(c) the rights of the Company, Cool Entertainment and the U.S.
Company to maintain the confidentiality of Confidential
Information, and to preserve its goodwill, constitute
proprietary rights of the Company, Cool Entertainment and the
U.S. Company which the Company, Cool Entertainment and the
U.S. Company are entitled to protect;
and the Consultant will not, during the Term and for one year after the expiry
thereof, disclose to any person, firm or corporation any Confidential
Information for any purpose other than the purposes of Cool Entertainment and
the U.S. Company and the Consultant will not disclose or use for any purpose
other than for those of Cool Entertainment or the U.S. Company any Confidential
Information, provided that the foregoing covenant shall not extend to
Confidential Information which:
(a) disclosure of is specifically consented to in writing by the
Company, Cool Entertainment and the U.S. Company;
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(b) the Consultant is required by applicable law or by an order of
a court of competent jurisdiction to disclose;
(c) now or subsequently becomes available to the public through no
fault of the Consultant;
(d) the Consultant can demonstrate to have had rightfully in its
possession prior to disclosure to the Consultant by the
Company, Cool Entertainment or the U.S. Company;
(e) is independently developed by the Consultant without the use
of any Confidential Information; or
(f) the Consultant rightfully obtains from a third party who has
the right to transfer or disclose it.
The Consultant acknowledges that the foregoing covenant is necessary and
fundamental for the protection of the businesses of Cool Entertainment and the
U.S. Company and that a breach by the Consultant of such covenant would result
in damage to Cool Entertainment and the U.S. Company which would not be
adequately compensated by an award of damages to Cool Entertainment or the U.S.
Company and that, in addition to all other remedies available to Cool
Entertainment or the U.S. Company, Cool Entertainment and the U.S. Company shall
be entitled to the immediate remedy of a restraining order, injunction or other
form of relief as may be decreed or issued by any court of competent
jurisdiction to restrain or enjoin the Consultant from breaching such covenant.
6.0 BREACH OF COVENANTS
If the Consultant is in breach of any of his covenants under this Agreement, the
Company shall have the right at any time to terminate this Agreement by giving
to the Consultant 30 days' notice of its intention to terminate and upon the
expiry of such 30 day period this Agreement will
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terminate except for the provisions of Articles 5 and 10, which shall survive
for a period of one year from such termination, and Article 8.
7.0 MISCELLANEOUS
7.1 NO PARTNERSHIP OR AGENCY
The relationship between the Company and the Consultant is that of independent
contractor and nothing herein contained shall be interpreted so as to create a
partnership or agency relationship between the Parties.
7.2 ENTIRE AGREEMENT
This Agreement constitutes the entire agreement between the Parties with respect
to the subject matter hereof and supersedes and replaces all previous
correspondence, written or oral, with respect to the subject matter hereof.
7.3 NOTICE
All communications required to be given under this Agreement will be in writing
and will be deemed to have been properly given if transmitted by facsimile
transmission or delivered to the address of the Party directly, and will be
deemed to have been received, if transmitted by facsimile transmission, on the
first Business Day following that facsimile transmission, or if delivered, upon
the date of delivery. The communications will be sent to the addresses set forth
on page one of this Agreement or any other address or addresses that the Parties
shall advise the other in writing from time to time.
8.0 TAXES AND OBLIGATIONS
Each of the Company and the Consultant shall be responsible for their own legal
obligations and will pay their own taxes and make their own payroll and other
deductions, as required by applicable law. Each Party agrees to indemnify and
save harmless the other from any claim which may affect the other Party in the
event of a breach by such Party of its obligations under this Agreement.
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9.0 TERMINATION
Except for the provisions of Articles 5, 10 and 8, either Party may terminate
this Agreement upon giving 30 days' prior notice in writing to the other.
10.0 NON-COMPETITION
10.1 The Consultant covenants and agrees that he will not, until
that day which is the earlier of: (i) one year from the expiry of the Term; and
(ii) the day the Vendors become entitled to terminate Chelsea's right of first
refusal provided in Section 7 of the Amendment and Restatement pursuant to
Section 7.4(h)(i) of the Escrow Agreement:
(a) directly or indirectly, in any capacity whatsoever,
alone or in association with any other person, firm or corporation (other than
the Company or Cool Entertainment), as a principal, agent, shareholder,
director, guarantor, creditor, or in any other relationship whatsoever, save and
except as an employee only, engage or be concerned or interested in any business
substantially similar to the business of Cool Entertainment and which may
compete with the business of Cool Entertainment at any time during that period
in any territory in which Cool Entertainment carries on its business;
(b) directly or indirectly, use or disclose to any person,
except duly authorized officers and employees of the Company and Cool
Entertainment, any Confidential Information acquired by him by reason of his
involvement and association with the Company; or
(c) directly or indirectly, solicit any customer of Cool
Entertainment, as of the date of termination of employment, in any territory in
which Cool Entertainment carries on its business during that period.
Notwithstanding the foregoing, the Consultant may invest in or have an interest
in entities traded on any public market or offered by any brokerage house, if an
so long as the interest does not exceed 5% of the voting control of such entity.
10.2 The parties recognize that irreparable damage would result
from any violation of the covenant in Section 10.1. It is therefore expressly
agreed that, in addition to any and all of
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the remedies available to the Company and Cool Entertainment, they will each be
entitled to the immediate remedy of injunction or such other equitable relief as
may be decreed or issued by any court of competent jurisdiction to enforce
Section 10.1 hereof.
10.3 The Consultant acknowledges that the covenant in Section 10.1
hereof is given for good and valuable consideration (receipt of which is hereby
acknowledged), and that by reason of his unique knowledge of and his association
with the business of Cool Entertainment, the scope of such covenant as to time
and area is reasonable and commensurate with the protection of the legitimate
interests of Cool Management and Cool Entertainment. The covenant in Section
10.1 shall survive expiry of the Term for a period of one year, and such
covenant is severable for that purpose. If any part of such covenant is held to
be unenforceable by a court of competent jurisdiction, such part may be severed
and replaced by the widest term that would not be held to be void or
unenforceable. The Consultant waives all defences to the strict enforcement of
such covenant.
11.0 INTELLECTUAL PROPERTY AND STOCK OPTION PLAN
11.1 The Consultant acknowledges that intellectual property
developed by him in the course of provision of services to the Company hereunder
will be the property of Cool Entertainment (subject to Section 7.4(c) of the
Escrow Agreement), and the Consultant will cooperate with Cool Entertainment
with respect to the making of any filings reasonably necessary to protect such
intellectual property, and will execute all documents reasonably necessary to
transfer the ownership of benefits thereof to Cool Entertainment.
11.2 The Consultant will be entitled to participate in any stock
option plan established by the U.S. Company , which upon completion of the
transaction described in the Amendment and Restatement shall be the owner of all
of the issued and outstanding shares in the capital of Cool Entertainment, on a
basis at least as favourable as that of any other participant therein.
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IN WITNESS WHEREOF this Agreement has been executed by the Parties as of the
date first above written.
COOL MANAGEMENT INC.
Per:
/s/ Xxxxxxx X.X. Xxx
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Xxxxxxx X.X. Xxx:
Authorized Signatory
Signed, sealed and delivered )
by XXXXXXX XXXXX XXXX )
in the presence of: )
)
/s/ Xxxxxxxx Xxxxx )
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X. Xxxxxxxx Fitch )
)
1000, 000 XXXX XXXXXX, XXXXXXXXX, X.X. )
-------------------------------------- ) /s/ Xxxxxxx Xxxxx Xxxx
Address ) -------------------------------
) XXXXXXX XXXXX XXXX
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)
)
Lawyer )
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Occupation )
