EXHIBIT 10.8
MANAGEMENT SERVICES AGREEMENT
THIS AGREEMENT is made effective as of the 1st day of May 2006 (the "Effective
Date"),
BETWEEN:
Consorteum Inc
(hereinafter referred to as the "Corporation")
- and-
Xxxxx X. Xxxxxx & Associates Inc. (hereinafter referred to as the
"Associates"), incorporated in the Province of Ontario. The services of
Associates shall be provided to the Corporation by Xxxxx X. Xxxxxx, of
the City of Toronto, in the Province of Ontario (hereinafter referred
to as the "Executive"). Executive and Associates shall be understood to
be interchangeable for the purposes of this Service Agreement.
ARTICLE 1
APPOINTMENT AND DUTIES
1.1 The Executive agrees to act as Chairman of the Corporation.
1.2 The Executive hereby acknowledges he is subject always to the
direction of the Corporation through the Board.
1.3 The Executive shall serve the Corporation in the capacity as
Executive Chairman and provide such services as are
commensurate with such position and responsibility. He shall
also chair, when present all meetings of the Board, and, inter
alia, direct the financial and capital market strategies
necessary for efficient performance, and accept responsibility
for the implementation of financial controls necessary to
assume appropriate compliance.
ARTICLE 2
TERM OF SERVICE
2.1 Subject to earlier termination pursuant to the terms hereof,
the initial term of this service agreement shall be from and
including the Effective Date up to and including June 30th,
2010 (the "Initial Term"), unless otherwise decided by
shareholders or the Board.
The service of the Executive shall, on the consent of both
parties, continue thereafter for an additional one year
period, but otherwise on the same terms and conditions
contained herein, or on revised terms and conditions as may be
established by the Board and agreed to by the Executive.
2.2 Notwithstanding the preceding Section 2.1, this Agreement
shall be subject to early termination during either the
Initial Term, or any subsequent periods, in accordance with
the termination provisions of Article 4 hereof.
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ARTICLE 3
REMUNERATION AND BENEFITS
3.1 While in the service of the Corporation, the Executive will be
paid an annual base fee in the amount of sixty thousand
dollars ($60,000), subject to applicable statutory deductions,
and contributions to employee benefit plans (the "Base Fee").
3.2 The Executive's Base Fee will be payable monthly, in
accordance with the Corporation's practices and procedures as
they may exist from time to time.
3.3 The Base Fee will be reviewed by the Board on an annual basis,
and may, in the sole discretion of the Board, be increased.
3.4 The Executive will be eligible to participate in a bonus plan
to be established by the Corporation (the "Bonus Plan"). The
Bonus Plan will be based upon the pre-tax cash flow of the
Corporation.
3.5 The Executive will be eligible to participate in any stock
option plan which the Corporation may establish in the future
for its employees to the extent determined by the Board in its
sole discretion.
3.6 The Executive will be eligible to participate in all existing
and future benefit plans of the Corporation which it makes
available to its executive employees, including without
limitation, dental, vision and health care benefits, long-term
care, disability and life insurance.
3.7 The Executive will be provided (This is subject to change)
with a home office allowance of $600.00 per month, ("the home
office allowance") to cover all home office expenses including
the purchase, leasing or maintenance of any equipment,
technology or supplies reasonably necessary or incidental to
the Executive's responsibilities to the Corporation.
3.8 The Executive shall be solely responsible for any and all
income tax liability including without limitation taxable
benefits from the receipt of the Auto Allowance, the
acquisition of common shares of the Corporation upon exercise
of stock option grants, and any other taxable benefits
received by the Executive under his service with the
Corporation. All payments made by the Corporation to the
Executive or for the benefit of the Executive shall be less
applicable withholdings and deductions.
3.9 The Corporation shall pay to the Executive an automobile
allowance of Cdn$ 800.00 per month. All reasonable and related
automobile expenses shall be reimbursed to the Executive or
Associates by the Corporation upon the provision of itemized
accounts and receipts.
ARTICLE 4
TERMINATION OF SERVICE
4.1 In the event the Executive resigns, at any time, for any
reason, he shall provide a minimum of three (3) months advance
written notice to the Corporation. The Executive will not be
entitled
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to receive any further compensation or benefits whatsoever,
other than those which have accrued up to the Executive's last
day of active service with the Corporation in the event of
termination by the Executive. The Corporation may, at its
discretion, waive in whole or in part such notice, without
further payment to the Executive;
4.2 Notwithstanding the term of this Agreement as set forth in
Section 2.1 hereof, the Executive hereby agrees that this
Agreement and his service shall be immediately terminable by
the Corporation, without payment of any severance or other
compensation to him in lieu of prior notice of such
termination, in the event of the existence of Just Cause for
the termination or in the event of the Disability of the
Employee. For the purposes hereof:
(a) "Just Cause" means any act or conduct which at common
law constitutes just cause and shall be deemed to
include, conduct materially inconsistent with the
fulfillment of the expressed or implied terms and
conditions of the Executive's service; materially
negligent performance by the Executive of his service
duties; or a consistent failure to exercise the
amount of care and skill required to perform his
duties herein in a competent manner, except where
such failure results from the occurrence of a
Disability; and
(b) "Disability" shall mean the failure of the Executive
to perform his duties on a substantially
uninterrupted basis for three (3) consecutive months
or for a period of five (5) months out of any twelve
(12) month period where such failure results from
physical or mental illness.
4.3 In the event this Agreement and the Executive's service is terminated
for Just Cause, the Corporation shall not be required to give the
Executive any notice of such termination or payment or other
compensation in lieu thereof. In such event, the Executive shall only
be entitled to the payment of his remuneration and any other benefits,
which have accrued to the date of termination. In such event, the
Executive expressly confirms and agrees that he shall not be entitled
to compensation for loss of contract, loss of benefits or other matters
relating to his contract with the Corporation.
4.4 Notwithstanding any other provision of this Agreement, the Corporation
shall remain liable to pay to the Executive his remuneration during the
period of time that the Executive is unable to perform his service
duties herein by reason of illness or mental or physical disability or
incapacity. In the event that such illness or mental or physical
disability or incapacity constitutes a Disability as defined in the
preceding subsection 4.2(b), then the Corporation may, in its sole
discretion, immediately terminate this Agreement and the Executive's
service without any notice of termination or payment of any
compensation for his loss of contract, loss of benefits, or other
matters relating to his contract with the Corporation.
4.5 The service of the Executive will be terminated automatically in the
event of the death of the Executive, and Associates will not be
entitled to receive any further compensation or benefits pursuant to
the terms of the service of the Executive, other than those which have
accrued up to the date of death.
4.6 In addition to the circumstances as set out in this Article 4 and
Section 2.3 hereof, the Corporation may terminate the Executive's
service at any time, without prior notice, by paying to the Executive a
separation package in a lump sum which will be equal to twelve (12)
months of the Base Fee (the "Separation Package").
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4.7 The Executive acknowledges that the Separation Package provided
pursuant to this Agreement supersedes and replaces any and all rights
to reasonable notice of termination that the Executive might otherwise
be entitled to at common law, and the Executive expressly waives any
rights to such notice. The Executive agrees that the Separation Package
is deemed conclusively to be reasonable notice of termination and
specifically includes all amounts owing for termination and/or
severance pay under any contract, statute, common law or otherwise.
4.8 Except as set out herein, the Executive will not be entitled to any
other Fee or benefits of service following his dismissal, including
without limitation, Auto Allowance, Discretionary Bonus, health
benefits, or the issuance or vesting of any stock options pursuant to
the Stock Option Plan.
4.9 In the event that the service of the Executive with the Corporation is
terminated in any manner, upon termination, the Executive agrees to
execute a comprehensive release to the effect that he acknowledges that
receipt of any monies pursuant to the terms of this Agreement is in
full satisfaction of any and all outstanding claims or entitlements
which the Executive may otherwise have against the Corporation and its
Affiliates, as well as the officers, directors, employees and agents of
the Corporation and its Affiliates.
4.10 The Executive understands and agrees that all benefits, including
long-term disability coverage will cease as of the date of termination
of the Executive's service, and the Corporation has no liability for
any damages caused by the cessation of such benefits coverage
regardless of the reason for termination or resignation. The
Corporation has no obligation to extend any benefit coverage past the
termination date.
4.11 All items of any kind or nature created or used by the Executive in the
course of service, or otherwise furnished by the Corporation, and all
equipment, credit cards, computers, cellular phones, data, books,
records, reports, files, notes, manuals, literature, software,
Confidential Information (as hereinafter defined) or any other
materials belonging to the Corporation or its customers, suppliers,
distributors, employees or consultants and in the Executive's
possession or control, shall be surrendered to the Corporation, in good
condition, promptly upon the Executive's termination of service,
irrespective of the time, manner or cause of termination.
ARTICLE 5
CONFIDENTIAL INFORMATION
5.1 The Executive recognizes and understands that in performing the service
duties and responsibilities as outlined in this agreement, the
Corporation will provide the Executive with access to and the Executive
will become knowledgeable with respect to a wide variety of nonpublic
information relating to the Corporation, its business and that of its
affiliates, its customers, suppliers, distributors, employees and
consultants of an extremely confidential nature (the "Confidential
Information").
5.2 During Associates' service with the Corporation, or at any time
thereafter, it shall not divulge, communicate or use any Confidential
Information which it may have access to or otherwise receive or obtain
in relation to the affairs of the Corporation or any of its
subsidiaries, related companies or affiliated entities. Breach of
confidentiality will be considered cause for immediate dismissal.
Associates' covenant of confidentiality will survive termination.
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ARTICLE 6
NOTICE
6.1 Any notice required to be given hereunder shall be in writing and
sufficiently made if sent by facsimile transmission, or delivered
personally or mailed by prepaid registered mail to the parties at their
respective addresses herein.
Associates:
Xxxxx X. Xxxxxx, Chairman
Trinity Capital Corporation
00 Xxxxxxxxxx Xxxxxx, Xxxxx 0000 Xxxxxxx, Xxxxxxx
X0X 0X0
(i) The Corporation:
Consorteum Inc,
000 Xxxxxxxxx Xx, Xxxx 00 Xxxxxxx
Xxxxxxx,
Any such notice shall be deemed to have been given on the date it is
delivered if personally delivered or sent by facsimile transmission,
or, if mailed, on the fifth business day following the mailing thereof.
Either party may change its address for service by giving written
notice hereunder.
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ARTICLE 7
GENERAL PROVISIONS
7.1 All dollar amounts set forth in this Agreement refer to Canadian
currency.
7.2 This Agreement shall be governed and construed in accordance with the
laws of the Duchy of Luxembourg.
IN WITNESS WHEREOF the parties hereto have executed and delivered this
Agreement as of the date first written above.
Per: /s/ Xxxxx X. Xxxxxxxx
----------------------------
Xxxxx X. Xxxxxxxx, CEO
SIGNED, SEALED AND DELIVERED )
In the presence of: )
)
)
)
) /s/ Xxxxx X. Xxxxxx
-------------------------
XXXXX X. XXXXXX, CHAIRMAN
XXXXX X. XXXXXX & ASSOCIATES INC.
