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EXHIBIT 10.1
MANAGEMENT AGREEMENT
THIS AGREEMENT made as of the 11th day of December, 1998 AMONG:
XXXXXXXX X. XXXXXXXXX, an individual residing in the City of
Calgary, in the Province of Alberta, Canada
(hereinafter called "MacKenzie")
OF THE FIRST PART
- AND -
GLOBAL HYDROCARBON CORPORATION LTD., a body corporate
incorporated under the laws of the Province of Alberta, with
head office in the City of Calgary, Province of Alberta,
Canada
(hereinafter called the "Manager")
OF THE SECOND PART
- AND -
SULPHUR CORPORATION OF CANADA LTD., a body corporate
incorporated under the laws of the Province of Alberta, with
head office in the City of Calgary, Province of Alberta,
Canada
(hereinafter called the "Corporation")
OF THE THIRD PART
- AND -
INTERNATIONAL HYDRO CARBON GROUP, INC, a body corporate
incorporated under the laws of the State of COLORADO, United
States of America.
(hereinafter called "IHC Group")
OF THE FOURTH PART
- AND -
SULPORT SERVICES INTERNATIONAL, INC, a body corporate
incorporated federally in Canada and registered in British
Columbia, Canada.
(hereinafter called the "SSI")
OF THE FIFTH PART
WITNESSES THAT:
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WHEREAS the Corporation is engaged in the business of
world-wide marketing and distribution of sulphur;
AND WHEREAS the Corporation wishes to retain the services of
the Manager to manage its business affairs and the Manager
wishes to provide such services upon the terms and conditions
hereinafter set forth;
AND WHEREAS MacKenzie is a director, officer and controlling
shareholder of the Manager;
AND WHEREAS IHC Group is the sole shareholder of the
Corporation;
AND WHEREAS IHC Group has agreed to guarantee the due and
timely performance of the obligations of the Corporation
hereunder;
AND WHEREAS this Agreement supercedes and replaces the
Management Agreement among the parties dated May 1, 1998.
IN CONSIDERATION of the premises and the mutual covenants and
agreements of the Parties hereinafter set forth, the Parties
covenant and agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
1.1 Definitions
In this Agreement, in addition to any terms defined parenthetically
herein, the following terms shall have the following meanings:
(a) "Affiliate" of the Corporation means:
(i) a body corporate which is a subsidiary of the
Corporation;
(ii) a body corporate of which the Corporation is a
subsidiary; or
(iii) a body corporate which is controlled by the same
person as the Corporation, and for the purposes of
the foregoing, a body corporate is controlled by a
person if:
(A) securities of the body corporate to
which are attached more than 50% of the
votes that may be cast to elect directors of
the body corporate are held, other than by
way of security only, by or for the benefit
of that person; and
(B) the votes that attach to those securities
are sufficient, if exercised, to elect a
majority of the directors of the body
corporate.
(iv) a body corporate is a subsidiary of another body
corporate if it is controlled by that other body
corporate.
(b) "Bonus" means the bonus payable to the Manager subject to and
in accordance with the terms and conditions set forth in
Article III.
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(c) "Consumer Price Index" means the all-items Consumer Price
Index as determined by Statistics Canada for the City of
Calgary from time to time.
(d) "Management Services" means the management, supervision and
direction of the business of the Organizations in the broadest
sense, including without limitation the following services:
(i) negotiating, arranging, supervising or acting as a
broker or agent in connection with the purchase,
sale, processing, tolling, trading, or swapping of
sulphur or sulphur services by or on behalf of any of
the Organizations;
(ii) assistance in the development of business plans and
corporate strategies and policies;
(iii) assistance in the economic evaluation of business and
investment opportunities;
(iv) providing advice on corporate financing and financial
management;
(v) the preparation, prior to the commencement of each
calendar year, of a detailed budget and pro forma
financial statements for the Corporation for the
ensuing calendar year for approval by the Board of
Directors of the Corporation;
(vi) the preparation and maintenance, in accordance with
United States generally accepted accounting
principles, of full books of account which contain
accurate and complete records of all income,
expenses, assets, liabilities and transactions of the
Corporation;
(vii) the design and implementation of effective
management reporting and control systems; and
(viii) the management of the day-to-day operations of the
business affairs of the Organizations.
(e) "Organizations" means any one or more of the following, namely
the Corporation, or any other person to whom the Corporation
from time to time instructs the Manager to provide its
services hereunder.
(f) "Party" means a person who is a party to this Agreement.
(g) "Person" includes a natural person, a corporation, a
partnership, a limited partnership, or an unincorporated
organization.
(h) "Term" means the term of this Agreement, as defined in
paragraph 2.2.
(i) "Termination Date" means the date of the termination of this
Agreement.
(j) "Tonne" means a metric ton comprised of 1000 kilograms.
(k) "Port Agreement" means:
(i) Any written agreement among the Corporation, Prince
Rupert Port Corporation and Xxxxxx Terminals Inc.,
relating to commodity processing at the Prince Rupert
site, beginning at the time of execution of such
document(s), as amended or supplemented from time to
time, together with any renewals or extensions
thereof.
1.2 Interpretation
For the purposes of this Agreement, except as expressly provided or
unless the context otherwise requires:
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(a) "this Agreement" means this Management Agreement as it may from time
to time be supplemented, amended, extended or renewed by one or more
agreements entered into pursuant to applicable provisions hereof;
(b) the headings used throughout this Agreement are solely for the
convenience of the Parties and are not to be used as an aid in the
interpretation of this agreement;
(c) the terms "Article", "paragraph" or "subparagraph" followed by a
number or letter or both means or refers to the specified Article,
paragraph or subparagraph of this Agreement, and "hereto",
"hereunder", "hereof", and "herein" and similar expressions refer to
this Agreement and not to any particular Article, paragraph or
subparagraph;
(d) all accounting terms shall have the meanings assigned to them in
accordance with United States generally accepted accounting
principles;
(e) all references contained herein to financial statements shall mean
audited financial statements which have been examined by a duly
qualified firm of Certified Public Accountants;
(f) all references to currency herein are deemed to mean United States
currency;
(g) any words or expressions contained in this Agreement which impart the
singular number include the plural number and vice versa; and
(h) any words or expressions contained in this Agreement which impart any
gender include all genders.
1.3 Proper Law and Consent to Jurisdiction
This Agreement and all matters arising hereunder shall be governed by
and construed and interpreted in accordance with the laws of the Province of
Alberta and the laws of Canada applicable therein. Each of the Parties hereby
submits exclusively to the jurisdiction of the courts of the Province of Alberta
for the interpretation and enforcement of this Agreement.
ARTICLE II
APPOINTMENT OF MANAGER
2.1 Agreement to Appoint Manager
The Corporation hereby appoints the Manager to provide the Management
Services to the Corporation and, if and when requested by the Corporation, to
one or more of the Organizations upon the following terms and conditions, which
the Manager hereby accepts.
2.2 Term of Appointment
Subject to earlier termination as hereinafter provided, the appointment
of the Manager hereunder shall be for a term which commences on the date hereof,
and which continues for a period of not less than ten (10) years, or for the
duration of the Port Agreement, as may be extended, whichever is longer
(hereinafter called the "Term").
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2.3 Duties of the Manager
As required by the Corporation, the Manager shall provide the Management
Services to the Corporation and, if any when requested by the Corporation, to
one or more of the Organizations, and in connection therewith the Manager shall:
(a) carry out all such lawful instructions as it may receive from the
Corporation from time to time;
(b) retain the full-time services of MacKenzie; and
(c) employ or retain the services of such other persons, with the prior
approval of the Corporation, which shall not be unreasonably withheld,
as may be reasonably required to perform its obligations hereunder.
2.4 Management Fee and Other Amounts Payable
For all Management Services provided by the Manager pursuant to this
Agreement, the Corporation agrees to pay to the Manager the following:
(a) a management fee (hereinafter called the "Management Fee") of One
Hundred and Twenty Thousand Dollars ($120,000) per calendar year, the
amount of such Management Fee to increase in each successive calendar
year commencing in 1999 by a percentage equal to the percentage
increase in the Consumer Price Index for the twelve month period
ending immediately prior to the start of the next calendar year of the
Term, to be paid in twenty-four (24) equal installments on the 15th
and 30th day of each and every calendar month of each year;
(b) an amount equal to the amount payable by the Manager to its employees
or contractors, excluding MacKenzie, whose services are devoted to the
performance of the Manager's duties and obligations under this
Agreement, for wages and salaries;
(c) an amount equal to the amount paid by the Manager to provide all of
its employees, including MacKenzie, whose services are devoted to the
performance of the Manager's and obligations under this Agreement
with:
(i) Alberta Health Care Insurance Plan coverage and Alberta Blue Cross coverage
in amounts set forth in Schedule "A" attached hereto; and
(ii) life insurance coverage and disability coverage in the amounts set forth in
Schedule "A" attached hereto;
(d) an amount equal to the amount paid by the Manager in respect of the
initiation fees and annual dues to maintain the Manager's or
MacKenzie's membership in those associations, groups and clubs
identified in Schedule "A" attached hereto, and any other association,
group or club that the Manager and the Corporation may agree is or
might be of benefit to the Organizations in the conduct of promotion
of their business affairs; and
(e) an amount equal to the lease installments payable by the Manager in
respect of one automobile which is to be leased by the Manager and
made available to MacKenzie for his use, plus all expenses relating to
such automobile.
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The amounts described in subparagraphs 2.4(b) to (e) inclusive shall be
estimated by the Manager for the purpose of preparing, and shall be included in,
the Corporation's annual budget, and shall be paid by the Corporation to the
Manager upon receipt of invoice.
2.5 Authority
The Manager shall have the authority to make the usual contracts
necessary for managing the business affairs of the Organizations in the ordinary
course, including the hiring and firing of all staff required, and including
authority to order goods and services required for such business affairs,
provided that no contract or investment shall be made by the Manager which might
involve an expenditure exceeding Twenty Thousand Dollars ($20,000) without first
obtaining the consent of the Board of Directors of the Corporation (except that
where (i) the directors of an Organization have passed a resolution which
authorizes the Manager to enter into contracts or make investments or execute
instruments which might involve an expenditure exceeding Twenty Thousand Dollars
($20,000) without first requiring the Organization's consent, or (ii) such
expenditure has been incurred pursuant to a budget previously approved by the
Corporation, or (iii) such expenditure has been approved by the Corporation, the
foregoing limitation on the Manager's authority shall not apply).
2.6 Commitment to Duties by XxxXxxxxx
XxxXxxxxx hereby agrees that during the Term he shall devote his full
professional and business time and attention to ensure that the Manager:
(a) performs its obligations hereunder in a due and timely manner;
(b) acts at all times as a fiduciary of the Organizations and exercises
the powers and discharge the duties imposed upon it or undertaken by
it honestly, in good faith and in the best interests of the
Organizations; and
(c) uses its best efforts to promote the goodwill and interests of the
Organizations;
and in connection therewith MacKenzie shall exercise the degree of care, skill
and diligence that a reasonably prudent person with comparable knowledge, skills
and experience would exercise in comparable circumstances.
MacKenzie hereby consents to his appointment as President and a
director of the Corporation, and agrees to serve as a director and an officer of
each of the Organizations, if and when requested to do so, and agrees to serve
as a director and/or officer of the Corporation and any of the Organizations
without compensation for the Term of this Agreement.
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2.7 Confidentiality
During the Term and thereafter, neither the Manager nor MacKenzie shall
disclose or use for its or his own purposes any private or confidential
information possessed by or relating to the affairs of the Organizations, except
as directed by the Corporation or as required by law.
2.8 Travel Expenses
The Manager shall be promptly reimbursed for all reasonable and
necessary travelling and other expenses actually and properly incurred by it in
connection with its duties hereunder and for all such expenses the Manager shall
furnish statements and vouchers to the Corporation.
2.9 Liability of The Manager and the Manager's Representatives
Neither the Manager nor any of its directors, officers, agents,
employees or other representatives (hereinafter referred to collectively as "the
Manager's Representatives") shall be liable to the Corporation or any of the
Organizations for any mistake or error in judgment, for any act or omission
believed in good faith to be within the scope of authority conferred on it or
them by this Agreement, or for any loss or damage incurred by the Corporation or
any of the Organizations relative to any Management Services provided pursuant
to this Agreement. Without limiting the generality of the foregoing, neither the
Manager nor the Managers Representatives shall be liable for any loss or
liability arising out of or resulting from:
(a) force majeure, which shall, without restricting the meaning ordinarily
ascribed thereto, include acts of God or the Queen's enemies, riots,
civil commotion, public disturbances, labour or industrial disputes,
strikes, lockouts, defects of material, government laws, rules or
regulations, intervention of governmental authorities and any other
causes, whether similar or dissimilar to those enumerated in this
subparagraph, over which the Manager shall have no reasonable control;
(b) loss or destruction of any Organization's assets from fire, explosion
or any hazard, in excess of proceeds of insurance in force and effect
at the time of loss;
(c) loss or destruction of any Organization's assets from uninsurable
hazards;
(d) accounting, secretarial or clerical errors of any type; and
(e) failure to attain any specific financial objectives, written or
unwritten, during the Term;
provided, however, that the Manager shall be liable for any loss or damage to
the Corporation or any of the Organizations which result from the Manager's
breach of any of its fiduciary duties to the Corporation or any of the
Organizations, or when any loss or damage is caused by the Manager's or the
Manager's Representatives' gross negligence, recklessness or willful misconduct,
but no act or omission of the Manager or the Manager's Representatives shall of
itself be deemed gross negligence, recklessness or willful misconduct if it is
done or omitted with the concurrence of the Corporation or any of the
Organizations.
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2.10 Indemnity of the Manager and the Manager's Representatives
The Corporation shall indemnify the Manager and the Manager's
Representatives against all costs, charges and expenses including any amount
paid to settle an action or satisfy a judgment, reasonably incurred by any of
them in respect of any civil, criminal or administrative action or proceeding to
which any of them is made a party by reason of any of the Manager's
Representatives being or having been a director or officer of any of the
Organizations, if:
(a) the Manager's Representative acted honestly and in good faith with a
view to the best interests of the Organization; and further
(b) in the case of a criminal or administrative action or proceeding that
is enforced by a monetary penalty, he had reasonable grounds for
believing that his conduct was lawful.
ARTICLE III
BONUS PROVISIONS
3.1 Entitlement to Bonus
Subject to paragraph 3.2, the Manager shall, in respect of each
calendar year of the Term, in addition to the Management Fee and other amounts
referred to in paragraph 2.4, be entitled to receive a Bonus equal to $0.50 for
each Tonne of sulphur processed through the proposed sulphur facility at the
Xxxxxx Island Terminal to be owned and operated by SSI, the subsidiary of IHC
Group, exceeding Four Hundred Thousand (400,000) Tonnes, which processing is
verified by SSI as directly attributable to Management Services provided to the
Corporation or SSI.
Any bonus payable to the Manager hereunder in respect of any calendar
year shall be paid to the Manager monthly, pro rata, over a six (6) month period
beginning thirty (30) days following the date on which the Manager delivers to
the Corporation a statement setting forth the amount of the bonus payable,
together with a calculation thereof and all relevant documentation in support
thereof, which shall be based upon the final audited financial statements of the
Corporation for the relevant calendar year which shall be based upon.
3.2 Notwithstanding paragraph 3.1, the Bonus payable to the Manager in
respect of any calendar year of the Term shall not exceed one-half the net
profits of the Corporation (as determined pursuant to paragraph 3.3) for such
calendar year.
3.3 For the purposes of paragraph 3.2 the net profits of the Corporation
for any calendar year of the Term shall be the amount, if any, before tax, by
which the gross revenue of the Corporation for such calendar year exceeds all
expenses of the Corporation (including depreciation) for such calendar year.
3.4 Termination of Agreement Prior to End of Calendar Year
If this Agreement is terminated effective on any date other than
December 31 of any calendar year then for the purpose of calculating the Bonus
payable to the Manager for the calendar year in which such termination occurs,
the Bonus threshold of 400,000 Tonnes per calendar year referred to in paragraph
3.1 shall be reduced by a fraction, the numerator of which
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shall be the number of days remaining in such calendar year following the
Termination Date, and the denominator of which shall be the number of days in
such calendar year.
ARTICLE IV
NON COMPETITION
4.1 Agreement Not to Compete
The Manager and MacKenzie covenant and agree that during the Term
neither they nor any of their affiliates shall engage in or undertake, directly
or indirectly as a shareholder, director, officer, employee, consultant or
otherwise, any business or occupation either related to the sulphur industry
(except as provided herein) or which would adversely affect or detract from
their respective abilities to perform their full-time duties and obligations
hereunder. Notwithstanding the foregoing, the Manager and MacKenzie and their
affiliates shall be entitled to make investments of a passive nature in
businesses unrelated to the sulphur industry and to hold not more than five
percent (5%) of the outstanding shares of any publicly-traded company which is
not primarily engaged in the sulphur industry.
ARTICLE V
TERMINATION OF AGREEMENT
5.1 Events of Termination
Notwithstanding the provisions of paragraph 2.2, this Agreement shall
terminate:
(a) at the option of the Corporation:
(i) thirty (30) days after the death of MacKenzie; or
(ii) ninety (90) days from the date that MacKenzie becomes
physically or mentally incapable of substantially providing
the services required of him hereunder; or
(iii) immediately upon MacKenzie ceasing to own at least a
majority of the issued and outstanding voting shares of the
Manager; or
(b) immediately in the event that the Manager is discharged for cause
by the Corporation; or
(c) immediately in the event that the Manager is discharged without
cause by the Corporation; or
(d) at the option of the Manager:
(i) immediately if the Corporation is in default in the payment,
in whole or in part, of any undisputed amounts payable to
the Manager hereunder, and such default is not rectified
within thirty (30) days after receipt by the Corporation and
IHC Group of notice thereof from the Manager (unless any
such default is the result of (x) an accounting error or (y)
was based on a good-faith belief by the Corporation that the
correct amount was paid of (z) there is a good-faith
disagreement among the Parties concerning the amount that
may be due); or
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(ii) immediately if any resolution is passed or any proceeding is
commenced with respect to the liquidation, dissolution or
winding-up of the Corporation; or
(iii) immediately if any bankruptcy, insolvency, or creditors'
arrangement proceedings are commenced by the Corporation or
the Corporation is adjudged to be bankrupt by a court of
competent jurisdiction; or
(iv) immediately if any creditor shall seize all or substantially
all of the assets or shares of the Corporation, or a
receiver, manager or trustee of the assets of the
Corporation shall be appointed; or
(v) immediately if the Corporation ceases, or substantially
curtails, its business operations in Canada; or
(vi) immediately if the Corporation enters into an agreement for
the sale of all or substantially all of its assets in Canada
other than to an Affiliate of the Corporation; or
(vii) immediately if control of a majority of the outstanding
voting shares of the Corporation is transferred to any other
person other than an Affiliate of the Corporation; or
(f) immediately upon termination of the Port Agreement; or
(g) at the option of the Manager upon six (6) months' notice for any
reason other than the reasons set forth in subparagraphs
5.1(d)(i) to(vii) inclusive.
Each of the grounds for termination as set forth in subparagraphs 5.1(a) to (g)
inclusive shall be mutually exclusive of each other, so that if this Agreement
is terminated it shall be terminated upon only one, but not more than one, of
such grounds.
5.2 Payments Upon Termination Pursuant to Subparagraph 5.l(a), 5.1(c),
5.1(d)(i) to (vii) inclusive, 5.1(f) or 5.1(g)
If this Agreement is terminated at any time pursuant to any of the
events described in any of subparagraphs 5.1(a), 5.1(c), 5.1(d)(i) to (vii)
inclusive, 5.1(f) or 5.1(g), then the following amounts shall be payable to the
Manager within sixty (60) days of the Termination Date:
(a) all accrued but unpaid Management Fees and other amounts
described in paragraph 2.4 to the Termination Date; plus
(b) all accrued but unpaid Bonuses owing in respect of any prior
calendar years; plus
(c) any accrued but unpaid Bonus in respect of the then current
calendar year, calculated in the manner set forth in Article III
from the first day of the then current calendar year to the
Termination Date.
5.3 Termination Pursuant to Subparagraph 5.1(b)
If this Agreement is terminated at any time by the Corporation for
cause pursuant to subparagraph 5.1(b), then the Corporation shall have the right
to withhold any amounts that would otherwise be payable to the Manager in
accordance with paragraph 5.2 as a set-off against any damages the Corporation
has or may sustain as a result of the Manager's offenses.
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ARTICLE VI
COVENANTS OF IHC GROUP
6.1 Covenant to Guarantee
IHC Group hereby unconditionally guarantees the due and timely
performance by the Corporation of all of its obligations hereunder, and
covenants and agrees that the Manager shall not be bound to exhaust its recourse
against the Corporation or any other person before being entitled to require IHC
Group to honor its guarantee contained in this paragraph 6.1.
ARTICLE VII
TRANSFER OF ASSETS OR SHARES OF THE CORPORATION
7.1 Transfer to an Affiliate
Either the Corporation or IHC Group (or any of their successors or
permitted assigns) may at any time sell, transfer, or otherwise dispose of any
portion of the right, title and interest in and to the Port Agreement, or a
majority of the shares of the Corporation owned by it to any Affiliate. The
Manager and MacKenzie hereby consent to any such "Affiliate-related"
transactions by the Corporation or IHC Group, provided that such Affiliate
undertakes and agrees in writing with the other Parties to this Agreement to be
governed and bound by its terms in the same manner and to the same extent as the
transferor.
ARTICLE VIII
MISCELLANEOUS
8.1 Books and Records
All books of account and all papers, records or documents of the
Corporation, and all contracts to which the Corporation is a party shall, at all
reasonable times, be open to inspection and examination by the Manager and its
authorized representatives, with full power to make copies of any extracts from
the whole or any part thereof; and all books of account and all papers, records
or documents of the Manager, and all contracts to which the Manager is a party
shall, at all reasonable times, be open to inspection and examination by the
Corporation, IHC Group or their respective authorized representatives, with full
power to make copies of any extracts from the whole or any part thereof.
8.2 Further Assurances
Each of the Parties shall from time to time and at all times hereafter,
without further consideration, do and perform all such further acts and things,
and execute and deliver all such further agreements, assurances, deeds,
documents and instruments as may be reasonably necessary to carry out the intent
and purpose of this Agreement.
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8.3 Notices
All notices or other communications required or permitted to be given
hereunder shall be in writing and shall be sufficiently given only if delivered
by hand or by prepaid courier service to the parties hereto at the following
addresses:
(a) in the case of MacKenzie or the Manager:
Suite 620 Alberta Stock Exchange Tower
000 Xxxxx Xxxxxx X.X.
Xxxxxxx, Xxxxxxx
X0X 0X0
(b) in the case of the Corporation, IHC Group or SSI:
c/o International Hydro Carbon Group, Inc.
Xxxx 0
00000 000X Xxxxxx
Xxxxxxx, XX
X0X 0X0
and any such notice or other communications so delivered shall be hand delivered
and deemed to be received on the first business day following the date of
delivery. Any Party may change his or its address for service by giving written
notice thereof to the other Parties in accordance with this paragraph.
8.4 Entire Agreement
This Agreement constitutes the entire agreement among the Parties with
respect to the matters referred to herein, and supercedes the Management
Agreement among the Parties dated May 1, 1998, and all other prior agreements,
representations or warranties whatsoever with respect to such matters, whether
oral or in writing, if any. There shall not be any oral statements,
representations, warranties undertakings or agreements among the Parties with
respect to the subject matter of this Agreement.
8.5 Amendments in Writing
This Agreement may not be amended or modified in any respect except by
written instruments signed by the Parties.
8.6 Severability
Should any provision of this Agreement, in whole or in part, be or
become invalid, illegal or not capable of performance, the validity or legality
of the remaining provisions of this Agreement shall not thereby be affected; or
should this Agreement fail to provide for any relevant matter, the validity or
legality of this Agreement shall not thereby be affected; and in
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any such case in lieu of the invalid, illegal or inoperative provision or the
missing provision, this Agreement shall be applied or interpreted in a
reasonable manner which so far as is legally permissible comes as close as
possible to the application that the Parties intended or would have intended
according to the sense and purpose of this Agreement had they considered the
matter or known of the invalidity, illegality or inoperativeness at the time of
the execution of this Agreement.
8.7 No Merger
The Parties agree that any rights and obligations contained herein
shall not merge upon the termination of this Agreement, and that all such rights
and obligations shall survive the termination of this Agreement until they have
been satisfied or discharged.
8.8 Assignment and Enurement
(a) Except as provided in paragraph 7.1 hereof, no Party shall
assign or transfer any of his or its rights or obligations
hereunder to any other person without the prior written
consent of the other Parties.
(b) Except as provided in subparagraph 8.8(a) hereof, this
Agreement shall enure to the benefit of and be binding upon
the Parties and their respective heirs, executors,
administrators, permitted successors and permitted assigns.
8.9 Independent Contractor
It is understood and agreed among the Parties that the Manager for the
purposes of this Agreement is an independent contractor, and the obligations of
the Manager hereunder shall not be construed by implication or otherwise as a
contract of employment or agency by the Corporation, and MacKenzie shall not be
deemed to be an employee of the Corporation by virtue of this Agreement, except
to the extent that MacKenzie may, by operation of law, be deemed to be an
employee of any Organization by virtue of his status as an officer of any
Organization. The Parties also expressly disclaim any intention to create a
partnership among any of themselves, and nothing contained in this Agreement
shall constitute any Parties hereto as partners with one another.
8.10 No Deemed Consent or Waiver
No consent or waiver, express or implied, by any Party to or of any
breach or default by any other Party in the performance of any obligations
hereunder shall be deemed or construed to be a consent or waiver to or of any
other breach or default in the performance by such other Party of the same or
any other obligation of such Party hereunder. Failure on the part of any Party
to complain of any act or failure to act of any other Party or to declare any
other Party in default, irrespective of how long such failure continues, shall
not constitute a waiver by such Party of his or its rights hereunder.
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8.11 Arbitration
All disputes or disagreements regarding any matter referred to or
provided for herein shall be referred to the arbitration of a single duly
qualified professional arbitrator, if the Parties agree upon one, otherwise to
three duly qualified professional arbitrator, one to be appointed by the
Manager, one to be appointed by the Corporation, and the third to be chosen by
the first two named professional arbitrators before they enter upon the business
of arbitration. The award and determination of such arbitrator or arbitrators,
or any two of such three arbitrators, shall be binding upon the Parties and
their respective heirs, executors, administrators, permitted successors and
permitted assigns. All costs of such arbitration shall be paid in the manner
determined by the arbitrator(s).
8.12 Taxes and Remittances
The Manager shall be solely responsible for:
(a) the payments, as and when the same are due and payable, of any
all income taxes or assessments exigible, payable or imposed
at any time and from time to time as a result of or in respect
of this Agreement or the Management Fee, the Bonus or any
other amounts payable to the Manager hereunder; and
(b) the payments required under any applicable foreign, Canadian
federal or provincial legislation or regulations, for the
withholding of amounts from employees and the remittance of
all such amounts withheld to the appropriate authorities
within the prescribed times, and the Manager and MacKenzie
shall and do hereby indemnify and save harmless the
Corporation and IHC Group and their respective directors and
officers from and against any and all liabilities, claims,
expenses, costs or damages (collectively, the "Claims")
incurred by or asserted against the Corporation or IHC Group
and respective directors and in respect of the same. Without
limiting the generality of the foregoing, the Corporation
and IHC Group may set-off the amount of any such Claims
against any amounts whatsoever owing or payable by the
Corporation or IHC Group to the Manager, including without
limitation any amount referred to in paragraphs 2.4 and 3.1.
In the event that at any time hereafter any new form of tax or
assessment becomes exigible, payable or imposed in respect of this Agreement or
the Management Fee, the Bonus or any other amounts payable to the Manager
hereunder, the Parties shall use their best efforts to agree on how the burden
of such tax shall be shared among themselves, and in the event that the Parties
are unable to agree on how such tax is to be shared, then the burden of such
tax, net of any corresponding tax credit, shall be shared equally by the Manager
and the Corporation.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF the Parties hereto have executed this Agreement as
of the 11th day of December, 1998.
/s/ Xxxxxxxx X. XxxXxxxxx
-----------------------------------
XXXXXXXX X. XXXXXXXXX, individually
GLOBAL HYDRO CARBON
CORPORATION LTD.
Per: /s/ Xxxxxxxx X. XxxXxxxxx
-----------------------------
INTERNATIONAL HYDRO CARBON
GROUP, INC.
Per: /s/ Xxxxx Xxxxxx
------------------------------
SULPHUR CORPORATION OF CANADA, LTD.
Per: /s/ Xxxxx Xxxxxx
-----------------------------
SULPORT SERVICES INTERNATIONAL, INC.
Per: /s/ Xxxxx Xxxxxx
-----------------------------
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SCHEDULE A
1. Willow Park Golf & Country Club
2. Calgary Petroleum Club
3. Alberta Sulphur Research Institute
4. The Sulphur Institute
5. The Fertilizer Institute
6. Alberta Health Care
7. Blue Cross Insurance
8. Vehicle plus operating expenses
9. Life Insurance $500,000 Term Life
10. Income Replacement policy for disability $500/month
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AFFIDAVIT OF EXECUTION
CANADA )
PROVINCE OF ALBERTA )
TO WIT: )
I, W.E. Xxxxxx of the City of Calgary in the province of Alberta make oath and
say:
1. That I was personally present and did see Xxxxxxxx X.
XxxXxxxxx named in the annexed Management Agreement, who is
personally known to me to be the person named therein, duly
sign and execute the same for the purpose named therein.
2. That the said Management Agreement was executed at the City of
Calgary, in the Province of Alberta, and that I am the
subscribing witness thereto.
3. That I know the said Xxxxxxxx X. XxxXxxxxx and he is in my
belief of the full age of 18 years.
SWORN before me at the City of Calgary, in the Province of Alberta,
this 11th day of December, 1998
/s/ Xxx Xxxxxx
----------------------------------------
A Commissioner for Oaths in and for the
Province of Alberta
Xxx Xxxxxx Apr. 11, 2000
Commissioner for Oaths
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