EXHIBIT 7
CONSULTING SERVICES CONTRACT
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This Consulting Services Contract, dated as of July 16, 1997 (this
"Contract") is between The CanFibre Group Ltd. ("Company"), an Ontario
corporation, and Enron Capital Trade Resources Corp. ("ECT"), a Delaware
corporation, and sets forth the terms and conditions pursuant to which the
Company will retain ECT to act as its consultant.
The Company and ECT agree as follows:
1. Retention of Consultant; Scope of Services.
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(a) Subject to the terms and conditions set forth herein, the Company
hereby retains ECT to act as a consultant to the Company during the Contract
Period (as defined in paragraph 3 below).
(b) As consultant to the Company, ECT will, from time to time, as
requested by the Company, provide consultation, assistance and advice to the
Company with respect to its operations and properties, including, without
limitation, analysis of potential property acquisitions, advice regarding
commodity pricing strategies and assistance in developing marketing strategies.
(c) The parties hereto acknowledge that (i) ECT is not regularly
engaged in the business of providing consulting services and personnel and that
the services to be performed by ECT hereunder are provided as an incident to
ECT's relationship with respect to the Company and its affiliates, (ii) ECT is
not an "investment advisor," within the meaning of the Investment Advisors Act
of 1940, as amended, or applicable state laws, or a "broker" or "dealer" under
the Securities Exchange Act of 1934, as amended, or applicable state laws, (iii)
the nature of the services to be provided by ECT under this Contract do not
include those of an "investment advisor" (i.e., providing advice as to the value
of securities or the advisability of investing in, purchasing or selling
securities), or those of a "broker" or "dealer" (i.e., effecting transaction in
securities for the account of the Company or others), and (iv) it is
specifically intended by the parties hereto that ECT's activities hereunder not
subject ECT to any regulation or registration under federal or state laws.
(d) The parties hereto acknowledge and agree that upon reasonable
request by the Company, ECT will, subject to the availability of such personnel,
make available such of its employees as ECT may determine may reasonably be
necessary for ECT's performance of its services hereunder. The parties further
acknowledge that unless and until ECT provides notice to the contrary, all
decisions with respect to staffing, scheduling and allocating ECT's resources
for purposes of this Contract will be coordinated on behalf of ECT by Xxxx X.
Xxxxxxxxx and any request by the Company for the performance of services
hereunder shall be directed to Xxxx X. Xxxxxxxxx.
2. Contract Period and Termination.
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ECT shall act as the Company's consultant under this Contract,
effective as of the date hereof (the "Effective Date") and continuing until July
15, 2007.
3. Advisement Fee.
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ECT shall be entitled to an annual fee for its services provided
during the period from the effective date of this Contract until the date of its
termination (the "Contract Period"). The fee shall be a sum equivalent to 5% of
the after tax distributable operating cash flow of the Company. The fee shall
be calculated on the basis of the audited financial statements of the Company
prepared from year to year (on a consolidated basis) and shall be paid to ECT
not more than sixty days after approval of the audited financial statements of
the Company by the Board of Directors of the Company,and in the event of the
failure of the Board of Directors of the Company to approve the audited
financial statements, not more than one hundred eighty (180) days after the
Company's year end.
4. GOVERNING LAW. THE VALIDITY AND INTERPRETATION OF THIS CONTRACT SHALL
BE GOVERNED BY THE INTERNAL LAWS OF THE PROVINCE OF BRITISH COLUMBIA APPLICABLE
TO CONTRACTS MADE AND TO BE FULLY PERFORMED THEREIN.
5. Successors and Assigns. The benefits of this Contract shall inure to
the parties hereto, their respective successors and permitted assigns, and to
the indemnified parties hereunder and their successors and representatives, and
the obligations and liabilities assumed in this Contract by the parties hereto
shall be binding upon their respective successors and assigns. This Contract
may not be assigned by any party to an unaffiliated party without the express
written consent of the other party hereto.
6. Notices. All communications under this Contract shall be in writing
and shall be delivered personally or sent by personal delivery, expedited
delivery, certified mail, return receipt requested or by telecopy as follows:
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If to ECT:
Enron Capital & Trade Resources
0000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Telecopy Number: (000) 000-0000
Attention: Xxxx X. Xxxxxxxxx
If to the Company:
The CanFibre Group Ltd.
0 Xxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0XX
Telecopy: (000) 000-0000
Attn: Chief Financial Officer
Either party may change its address or telecopy number set forth above
by giving the other party notice of such change in accordance with the
provisions of this Paragraph 7. A notice shall be deemed given, if by personal
delivery or expedited delivery service, on the date of such delivery to such
address, if by certified mail, on the date shown on the applicable return
receipt, or if by telecopy, on the date of receipt o the transmission of such
notice at such telecopy number.
7. Nature of Relationship. The parties hereto intend that ECT's
relationship tot he Company and the relationship of each employee or agent of
ECT to the Company shall be that of an independent contractor. Nothing
contained in this Contract shall constitute or be construed to be or create a
partnership or joint venture between ECT and the Company or their respective
successors or assigns. Neither ECT nor any partner, employee or agent of ECT
shall ever be considered to be an employee of the Company.
8. Captions. The Paragraph titles herein are from reference purposes
only and do not control or affect the meaning or interpretation of any term or
provision hereof.
9. Amendments. No alteration, amendment, change or addition hereto
hall be binding or effective unless the same is set forth in writing signed by a
duly authorized representative of each party.
10. Partial Invalidity. If the final determination of a court of
competent jurisdiction declares, after the expiration of the time within which
judicial review (if permitted) of such
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determination may be perfected, that any term or provision hereof is invalid or
unenforceable, (i) the remaining terms and provisions hereof shall be unimpaired
and (ii) the invalid or unenforceable term or provision shall be replaced by a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision.
11. Survival. All representations, warranties and agreements contained
herein, or contained in certificates submitted pursuant to this Contract, shall
remain operative and in full force and effect regardless of any investigation
made by or on behalf of any party hereto, and shall survive the execution and
delivery hereof.
12. Entire Contract. This Contract and the exhibits hereto embody the
entire agreement and understanding of the parties and supersede any and all
prior agreements, arrangements and understanding relating to matters provided
for herein.
13. Counterparts. This Contract may be executed in one or more
counterparts, each of which shall be an original, but all of which together
shall be considered one and the same agreement.
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This Contract is executed as of the date first written above by a duly
authorized representative of each of the Company and ECT.
COMPANY
THE CANFIBRE GROUP LTD.
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
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Title: President
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ECT
ENRON CAPITAL & TRADE RESOURCES
By: /s/ J. Xxxxx XxXxxxxxxx
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Name: J. Xxxxx XxXxxxxxxx
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Title: Vice President
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