Exhibit 10.2
THIS FORGIVENESS AGREEMENT made this 31st day of March, 1999.
BETWEEN: HER MAJESTY THE QUEEN IN RIGHT
OF THE PROVINCE OF NEW BRUNSWICK, as
represented by the Minister of Economic
Development, Tourism and Culture,
(hereinafter called the "Minister'),
OF THE FIRST PART
A N D: RMH TELESERVICES INC., a body
corporate, duly incorporated under and
by virtue of the laws of the
Commonwealth of Pennsylvania, United
States of America, and having its
registered office at 00 Xxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxx Xxxxxx of America,
(hereafter called the "Corporation"),
OF THE SECOND PART
WHEREAS under the authority of Order-in-Council 98-783 made pursuant
to the Economic Development Act, Acts of New Brunswick, 1975, Chapter E-1.11,
the Minister has made or has agreed to make a loan to the Corporation in the
amount of up to $2,000,000.00, subject to the temis and conditions set forth
herein, for the purpose of assisting the Corporation to finance a portion of the
capital cost of establishing a call centre service bureau (hereinafter called
the "Facility"), in the Province of New Brunswick;
AND WHEREAS the Minister and the Corporation have, in respect of the
Loan and the repayment thereof, entered into a certain Loan Agreement
(hereinafter called the "Loan Agreement") bearing even date herewith;
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AND WHEREAS under the authority of the said Order-in-Council, the
Minister has also been authorized to enter into this Agreement with the
Corporation.
NOW THEREFORE THIS INDENTURE WITNESSETH that in consideration of the
sum of Ten Dollars ($10.00) in lawful money of Canada paid by each of the
parties to the other of them, the receipt whereof is hereby acknowledged, the
parties hereto agree as follows:
0.Xx this Agreement:
(a) "Calculation Period" means the period of time commencing on the
1st day of April, 1999 and ending
(i) on the 31st day of March, 2003 or
(ii) on the date that the Principal Sum becomes immediately
due and payable pursuant to the provisions of Clause 11
of the Loan Agreement,
whichever date referred to in paragraphs (i) and (ii) shall first
occur;
(b) "Facility Employees" means those employees of the Corporation
who are engaged by the Corporation to work at the Facility except
those:
(i) who are not ordinarily resident in New Brunswick;
(ii) employees who normally work less than 20 hours per week;
and
(iii) employees who are officers, directors or shareholders of
the Corporation;
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(c) "Interest" means the interest on the Principal Sum determined
and calculated at the rate and in the manner set forth in the Loan
Agreement;
(d) "Letter of Offer means that certain letter from the Minister to
the Corporation dated February 10, 1999, a copy of which is attached
as Schedule UAD to the Loan Agreement;
(e) "Number of Full Time Equivalent Jobs" means the lesser of 400,
and the quotient obtained by dividing by 5,460 hours, the Number of
Paid Hours worked or performed at the Facility by the Facility
Employees during the Calculation Period;
(f) "Number of Paid Hours" means the number of hours worked or
performed at the Facility by the Facility Employees during the
Calculation Period for which the Facility Employees have been fully
paid; Provided that for the purposes of any calculation under this
Agreement to determine the Number of Paid Hours, the aggregate
number of hours that can be worked or performed by a particular
Facility Employee and by all other Facility Employees, while
replacing or substituting for or filling the position of that
particular Facility Employee, shall not exceed 5,460 hours during
the Calculation Period;
(g) "Principal Sum" means the principal of the Loan, or that portion
of the Loan that is advanced by the Minister to the Corporation
under the Loan Agreement.
2. Subject always to the provisions of this Agreement, the parties hereto agree
that the Principal Sum and Interest outstanding under the Loan Agreement shall
be respectively reduced and forgiven as follows:
(a) the Principal Sum shall be reduced and forgiven by the amount of:
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(i) 2,000,000.00; or
(ii) the amount equal to the product obtained by multiplying
$5,000.00 by the aggregate of:
(A) the Number of Full Time Equivalent Jobs created and
maintained at the Facility by the Corporation during the
Calculation Period, and
(B) the number, if any, by which the Number of Full Time
Equivalent Jobs is increased, as verified and approved
by the Minister, pursuant to the provisions of the
Letter of Offer;
whichever amount referred to in subparagraph (i) and (ii) of this
paragraph (a) is the lesser amount; and
(b) Interest shall be reduced and forgiven by the amount equal to
the amount of Interest which is attributable to that portion of the
Principal Sum that is forgiven and reduced pursuant to paragraph (a)
of this Clause 2.
3. That portion of the Principal Sum and Interest that is not forgiven pursuant
to the provisions of Clause 2 of this Agreement shall become due and payable by
the Corporation to the Minister on the 31 ~ day of March, 2003, or on such
earlier date as the Principal Sum and Interest may become payable pursuant to
the provisions of the Loan Agreement.
4. The parties do hereby acknowledge and agree that the provisions of Clause 2
of this Agreement are conditional upon the Principal Sum or Interest, or any
part thereof, not becoming payable under the Loan Agreement prior to the 31 day
of March, 2002, it being further acknowledged and agreed that in the event the
Principal Sum or Interest, or any part thereof, becomes payable under the Loan
Agreement prior to the 31 day of March, 2002, the provisions of
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Clause 2 of this Agreement shall be deemed at all material times to have been
null and void from the outset and of no force or effect whatsoever, and the full
amount of the Principal Sum and Interest shall be or become payable by the
Corporation to the Minister in accordance with the provisions of the Loan
Agreement.
5. The Corporation agrees to provide to the Minister, when due, the written
Employment Reports referred to in the letter of Offer, which Employment Reports
shall be in the form and shall contain the information and data set forth in the
Letter of Offer or as otherwise required by the Minister from time to time.
6. The Corporation shall grant to the Minister, or his agents and
representatives, at all reasonable times during the term of the Loan, access to
all of the books and records of the Corporation, and the Minister and his agents
and representatives shall have the right to inspect such books and records of
the Corporation and to make extracts therefrom and to conduct such examination
thereof as the Minister may consider necessary.
7. The Corporation shall provide to the Minister in addition to the requirements
set forth in Clause 5 and 6 of this Agreement, such information, statistics and
data respecting the business and operations of the Facility as the Minister may
from time to time consider necessary for the purposes of this Agreement and any
calculations made or to be made pursuant to this Agreement.
8. Except to the extent that the provisions of this Agreement affect or may
affect the amount of the Principal Sum and Interest payable or to become payable
by the Corporation to the Minister under the Loan Agreement, the Loan Agreement
shall continue in full force and effect, and each and every term,
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provision, condition, covenant, promise and agreement set forth and contained in
the Loan Agreement is hereby ratified and confirmed.
9. It is agreed and understood that in the event of any discrepancy or conflict
between the provisions of this Agreement and the provisions of the Letter of
Offer, the provisions of this Agreement shall prevail.
10. This Agreement shall not be assignable by the Corporation.
11. Time shall be of the essence of this Agreement.
12. In this Agreement, a word in the singular includes the plural, and a word in
the plural includes the singular.
13. This Agreement shall be governed in all respects by the laws of the Province
of New Brunswick.
This Agreement shall enure to the benefit of and be the parties
hereto and their respective successors and assigns.
IN WITNESS WHEREOF the parties hereto have causea presents to be
duly executed on the day and year first above written.
SIGNED, SEALED AND DELIVERED ) HER MAJESTY THE QUEEN
in the presence of: ) IN RIGHT OF THE PROVINCE
) OF NEW BRUNSWICK
)
)
/s/ Xxxxxx Xxxxxxxx ) /s/ [ILLEGIBLE]
--------------------------- ) ---------------------------------
) Minister of Economic Development,
) Tourism and Culture
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)
) RMH TELESERVICES INC.
)
)
/s/ [ILLEGIBLE] ) /s/ [ILLEGIBLE]
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