Exhibit 10.14
EXPENSE REIMBURSEMENT AGREEMENT
MEMORANDUM OF AGREEMENT made at Xxxxxxxx, Xxxxxx, Xxxxxx on April 1st, 2005
BY AND BETWEEN: XXXXX XXXXX & SONS INC., a company incorporated under the
laws of Canada and having its head office at 1240 Xxxxxxxx
Square, Montreal, (Quebec)
(hereinafter referred to as "Birks")
AND: INIZIATIVA S.A., a body incorporated under the Laws of
Luxembourg and having its head office at 00 xxx Xxxxxxxx,
Xxxxxxxxxx
(hereinafter referred to as "Iniziativa"),
THIS AGREEMENT WITNESSETH THAT, in consideration of the mutual covenants herein
contained, it is agreed by and between the Parties as follows:
ARTICLE ONE
INTERPRETATION
1.1. DEFINITIONS. For the purposes hereof, the following words and phrases
shall have the following meanings, respectively, unless otherwise
specified by the context:
(a) "Advisory, Management and Corporate Services" shall have the
meaning ascribed thereto at Section 2.1 and shall be hereinafter
referred to as AMCS;
(b) "Agreement" shall mean this Expense Reimbursement Agreement and
all instruments supplemental hereto or any amendment or
confirmation hereof; "herein", "hereof", "hereto" and "hereunder"
and similar expressions mean and refer to this Agreement and not
to any particular Article, Section, Subsection or other
subdivision;
(c) "Event of Default" shall have the meaning ascribed thereto at
Section 5.2;
(d) "Event of Force Majeure" shall have the meaning ascribed thereto
at Section 4.1;
(e) "Parties" shall mean Birks and Iniziativa and "Party" shall mean
any one of them;
1.2 GENDER. Any reference in this Agreement to any gender shall include all
genders and words used herein importing the singular number only shall
include the plural and vice versa.
1.3 HEADINGS. The division of this Agreement into Articles, Sections,
Subsections and other subdivisions and the insertion of headings are for
convenience or reference only and shall not affect or be utilized in the
construction or interpretation hereof.
1.4 SEVERABILITY. Any Article, Section, Subsection or other subdivision of
this Agreement or any other provision of this Agreement which is, or
becomes, illegal, invalid or unenforceable shall be severed here from and
shall be ineffective to the extent of such illegality, invalidity or
unenforceability and shall not affect or impair the remaining provisions
hereof, which provisions shall be severed from any illegal, invalid or
unenforceable Article, Section, Subsection or other subdivision of this
Agreement or any other provisions of this Agreement.
1.5 ENTIRE AGREEMENT. This Agreement, together with any documents to be
delivered pursuant hereto or thereto, constitute the entire agreement
between the Parties pertaining to the subject matter hereof and supersede
all prior agreements, understandings, negotiations and discussions,
whether oral or written, of the Parties.
1.6 WAIVER. No waiver of any of the provisions of this Agreement shall be
deemed to constitute a waiver of any other provisions (whether similar or
not) nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided in writing and duly executed by the Party to
be bound thereby.
1.7 GOVERNING LAW. This Agreement shall be governed, interpreted and
construed in accordance with the Laws of the province of Quebec and Laws
of Canada applicable therein and shall be treated in all respects as a
Quebec contract.
1.8 LANGUAGE. The parties have required that this Agreement and all documents
or notices relating thereto be in the English language; les parties ont
exige que cette convention et autre document ou avis y afferent soient en
langue anglaise.
1.9 ACCOUNTING PRINCIPLES. Accounting terms not otherwise defined have the
meanings ascribed thereto under Generally Accepted Accounting Principles
(GAAP). Wherever in this Agreement reference is made to GAAP, such
reference shall be deemed to be Generally Accepted Accounting Principles,
from time to time approved by the Canadian Institute of Chartered
Accountants applicable as at the date on which such calculation has been
made, is made or required to be made in accordance with GAAP.
1.10 CURRENCY: Unless otherwise indicated, all dollar amounts in this
Agreement are expressed in Canadian funds.
1.11 INDEPENDENT CONTRACTOR. Nothing contained in this Agreement shall be
construed as creating any relationship between the Parties other than
that of independent contractors. Iniziativa shall not represent to third
parties being authorized or entitled to execute or agree on behalf of
Birks' or bind Birks to any agreement or document of any kind whatsoever.
ARTICLE TWO
SERVICES
2.1 ADVISORY, MANAGEMENT AND CORPORATE SERVICES. On Birks's request,
Iniziativa agrees to provide to Birks the following services
(collectively known as the "AMCS"):
(a) provide Birks with general assistance concerning strategic issues
and opportunities and make recommendations as to the development,
planning and formulation of business strategies;
(b) assist Birks on financial matters especially financial projections
and financing structures and models, reporting systems and
control;
(c) assist in the coordination of the relations and/or negotiations
with external bodies and other companies including without
limitation, banks and financial institutions;
(d) assist Birks in the preparation of various reports and in any
necessary coordination relating thereto;
(e) perform professional visits to or on behalf of Birks as Birks may
so request;
(f) perform a variety of services, as requested, including but not
limited to support to production, marketing, merchandising,
production etc.
2.2 REPRESENTATIONS AND WARRANTIES. Iniziativa hereby represents and warrants
to Birks as follows and acknowledges that Birks is relying upon such
representations and warranties in connection with this agreement:
(a) the personnel of Iniziativa will have the required skills and
capacity to provide AMCS in accordance with this Agreement; and
(b) Iniziativa knows of no facts or circumstances, which would prevent
it from providing personnel to Birks hereunder.
(c) Iniziativa represents that the amounts to be invoiced to Birks
shall be reasonable in all of circumstances, having regard to the
nature of the services to be rendered, the qualifications of the
person providing such services and generally prevailing market
conditions.
2.3 STANDARD OF PERFORMANCE. The personnel of Iniziativa will perform AMCS in
a professional and prudent manner, using sound and proven principles and
procedures, and in accordance with the best of care in the industry.
2.4 NOTIFICATION. Each Party shall forthwith notify the other Party of any
circumstances or facts that materially and adversely affect or could
reasonably be expected to materially and adversely affect such Party's
performance of its obligations hereunder.
ARTICLE THREE
FEES
3.1 Effective the date hereof, Birks shall, in consideration of Iniziativa
agreeing to provide AMCS to Birks, reimburse or cause to be reimbursed to
Iniziativa an amount equal to a maximum monthly amount of (euro)28,750
payable on the 1st calendar day after the receipt of the invoice
including but not limited all the details listed in Section 3.3 and the
presentation of documents satisfactory to support said payments.
3.2 OTHER OUT-OF-POCKET DISBURSEMENTS : Birks will also reimburse, upon
presentation of supporting documents, Iniziativa for the following direct
out-of-pocket disbursements reasonably and actually incurred by
Iniziativa in the performance of AMCS:
(a) lodging and transportation expenses reasonably incurred by the
personnel of Iniziativa in the performance of AMCS; and
(b) such other out-of-pocket disbursements as are reasonably required
to be made by Iniziativa in providing AMCS under this Agreement.
3.3 INVOICES. Iniziativa will invoice Birks for amounts payable pursuant to
Sections 3.1 and 3.2. Each invoice will be itemized to show, among other
things, the personnel who during the calendar month rendered AMCS and the
number of hours worked by each, the details of services rendered during
the period and details of out-of-pocket disbursements and expenses
covered by such invoice together with supporting vouchers and receipts.
If needed any applicable exchange rate will be calculated in accordance
with GAAP.
3.4 WHITHOLDING TAXES. Birks will withhold the applicable tax(es) if any on
the gross amount representing payment for services rendered by a
non-resident at the prescribed rate.
ARTICLE FOUR
FORCE MAJEURE
4.1 EVENT OF FORCE "MAJEURE". Subject to Section 5.2, a Party shall be
excused from its failure to perform any of its obligations hereunder if
such Party is unable to perform such obligation by reason of an Event of
Force Majeure. "Event of Force Majeure" shall mean any of, and "Events of
Force Majeure" shall be limited to:
(a) Acts of God;
(b) expropriation, confiscation or requisitioning of facilities or
compliance with any law which affects to a degree not presently
existing the supply, availability of use of materials or labour;
(c) acts or inaction on the part of any governmental authority or
person purporting to act therefor;
(d) embargoes, or acts of war or the public enemy, whether war be
declared or not;
(e) public disorder, insurrection, rebellion, riots or violent
demonstrations;
(f) floods, earthquakes, lightning, hail, inclement weather conditions
or other natural calamities; and
(g) any circumstances whether or not of the class or kind specifically
named above not within the reasonable control of the Party
affected and which, despite the exercise of reasonable diligence,
such Party is unable to prevent, avoid or remove.
4.2 NOTICE OF FORCE MAJEURE. If any Party wishes to invoke an Event of Force
Majeure, then it shall (i) immediately following the commencement of such
Event of Force Majeure notify the other Party of the occurrence of such
Event of Force Majeure, the reasonably estimated date and time on which
it commenced and the nature of the Event of Force Majeure, and (ii) as
soon as reasonably practicable thereafter submit to the other Party proof
of the nature of such Event of Force Majeure. The Parties shall thereupon
consult with one another concerning the effects of such Event of Force
Majeure and will make all reasonable efforts to prevent and reduce to a
minimum and mitigate the effect of any Event of Force Majeure.
4.3 TERMINATION OF FORCE MAJEURE. The Party affected by an Event of Force
Majeure shall forthwith upon the termination of such Event of Force
Majeure resume the performance of all of its obligations hereunder and
notify the other Party of such termination.
ARTICLE FIVE
TERM; REMEDIES
5.1 TERM. This Agreement will become effective on April 1, 2005 and will
remain in effect until March 31st, 2006. Notwithstanding anything to the
contrary, the Board of Directors of Birks may at any time and its sole
and absolute discretion terminates this Agreement upon written notice to
Iniziativa. This Agreement will automatically terminated upon the change
of control of either party.
5.2 EVENT OF DEFAULT. An "Event of Default" will mean any of the following:
(a) The failure by any Party to perform or fulfill any obligation
pursuant to the Agreement;
(b) The bankruptcy of any Party or the making by such Party of an
assignment for the benefit of creditors, or the appointment of a
trustee or receiver and manager or liquidator to such Party for
all or a substantial part of its property, or the commencement of
bankruptcy, reorganization, arrangement, insolvency or similar
proceedings by or against such Party under the laws of any
jurisdiction, except where such proceedings are defended in good
faith by such Party.
5.3 REMEDIES. If any Event of Default shall have occurred to any Party, then
the other Party may exercise the remedies permitted by the law of Quebec
and/or Canada.
5.4 DEFAULT INTEREST. If any Party fails to pay as and when due and payable
any amount hereunder, then such Party shall pay interest on such amount
from the due date up to and including the date when such amount and all
interests thereon are paid in full at the rate per
annum equal to (i) the rate of interest commonly known and referred to as
the prime rate of the National Bank of Canada plus (ii) one percent (1%).
Such interests shall be payable on demand.
ARTICLE SIX
GENERAL
6.1 NOTICES. Any notice, consent, approval, direction or other instrument
required or permitted to be given hereunder shall be in writing and given
by delivery or sent by telex, telecopier or similar telecommunication
device and addressed:
(a) in the case of Birks to:
Attention: President & CEO and to the Chief Financial Officer
Copy to: Vice-President and General counsel
Xxxxx Xxxxx & Sons Inc, 0000 Xxxxxxxx Xxxxxx,
Xxxxxxxx, Xxxxxx, X0X 0X0, Xxxxxx
(b) in the case of Iniziativa to:
Attention: The Director Finance
Iniziativa S.A.
00 xxx Xxxxxxxx
X-0000, Xxxxxxxxxx
and a copy to: - The Group CEO;
Regaluxe Investment SarL - Branch Office
Xxx Xxxxx 0, 00000,
Xxxxx, Xxxxx.
Any notice, consent, approval, direction or other instrument given as
aforesaid shall be deemed to have been effectively given and received, if
sent by telex, telecopier or similar telecommunications device on the
next Business day following such transmission or, if delivered, to have
been given and received on the date of such delivery. Any Party may
change its address for service by written notice given as aforesaid.
6.2 TIME. Time shall be of the essence of this Agreement.
6.3 ASSIGNMENT. Either Party, upon written notice to the other, may assign
this Agreement.
IN WITNESS WHEREOF, the Parties have executed this Agreement on the date and at
the place first above mentioned.
INIZIATIVA S.A.
Per: /s/ Filippo Recami
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Per:
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XXXXX XXXXX & SONS INC.
Per: /s/ Xxxxxx X. Xxxxxxxxxxxx
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Xxxxxx X. Xxxxxxxxxxxx, President and Chief
Executive Officer
