EXHIBIT 10.7
MANAGEMENT SERVICES AGREEMENT WITH XXXXX XXXXXXX
DATED MAY 1, 2005
PATCH INTERNATIONAL INC.
Xxxxx 0000, Xxxx Xxxxx
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, X.X. X0X 0X0
May 1, 2005
Xxxxx Xxxxxxx
Dear Xx. Xxxxxxx:
RE: MANAGEMENT SERVICES
The following are the terms and conditions upon which Patch International Inc.
(the "Company") is prepared to contract with you to provide your services to the
Company. By signing this letter agreement you accept the following terms and
conditions:
1. WORK DUTIES
1.1 You will carry out such duties and responsibilities as the board of
directors may from time to time determine including, but not limited to, the
duties of President of the Company.
2. TERM OF ENGAGEMENT
2.1 The contract shall be for a five year period, starting May 1, 2005 and
ending April 30, 2010, provided that this Agreement shall be automatically
renewed for successive terms on a year to year basis unless notice of
non-renewal is effected by either party with written notice of non-renewal at
least 90 days prior to the expiry of the then applicable term of this Agreement,
in which case this Agreement will expire on the last day of such term.
3. CONSIDERATION
3.1 Subject to the other terms and conditions of this Agreement, the Company
agrees to pay consideration of US$175,000 per annum for the services provided
hereunder, subject to such increases as the board of directors shall determine.
Such consideration is to be paid in monthly instalments, pro rata and in arrears
as at the end of each month, provided that, by written notice to the Company
within five business days of the end of any month, you may elect to receive such
monthly instalment in shares of the Company, in which case such shares shall be
valued based upon the weighted average closing price of the Company shares for
the last five trading days of such month.
-2-
3.2 You shall also be eligible for incentive compensation in the form of stock
options in the Company, in accordance with the policy formulated by the Company
from time to time. Eligibility for stock options shall be determined by the
Company's compensation committee.
4. EXPENSES
4.1 In accordance with policies formulated by the Company from time to time, you
will be reimbursed for all reasonable travelling and other expenses actually and
properly incurred by you in connection with the performance of your duties and
functions. For all such expenses, you will be required to keep proper accounts
and to furnish statements and vouchers to the Company within 30 days after the
date the expenses are incurred.
5. SERVICE TO THE COMPANY
5.1 During the term of this Agreement, you shall devote such amount of time as
shall be reasonably necessary to performing the services hereunder provided that
it is acknowledged that it is not intended that you devote the whole of your
working time to providing the services hereunder.
6. CONFIDENTIALITY
6.1 All business and trade secrets and confidential information and knowledge
which may be acquired during the terms of this Agreement related to the business
and affairs of the Company (collectively the "Confidential Information"), will
for all purposes and at all times, both during the term of this Agreement and at
all times thereafter, be held by you in trust for the exclusive benefit of the
Company. Neither during the term of this Agreement nor at any time thereafter
shall such Confidential Information be disclosed to any corporation or person
other than the Company, nor will it be used for any purposes other than those
expressly authorized by the Company. This paragraph does not apply to any
information which would be found in the public domain.
7. TERMINATION
7.1 The following termination and resignation provisions apply to this
Agreement:
(a) it may be terminated by you on 30 days' prior written notice to
the Company; and
(b) on receipt of such notice, the Company may elect to pay a pro rata
portion of the annual compensation provided for hereunder for such 30
days, in which case the Agreement will terminate immediately upon
receipt of such payment.
8. INDEPENDENT CONTRACTOR
8.1 In performing the services hereunder, it is acknowledged that you are
acting as an independent contractor and not as an employee of the Company.
-3-
9. LAW OF THE CONTRACT
9.1 Any dispute relating to the terms of this Agreement will be resolved
pursuant to the laws of the Province of British Columbia.
If you are prepared to accept an engagement by the Company on the foregoing
terms, kindly confirm your acceptance and agreement by signing the enclosed
duplicate copy of this letter where indicated and return one copy to us.
This engagement letter supercedes and replaces any prior consulting or
employment agreements which you may have had, directly or indirectly, with the
Company or any subsidiary of the Company.
We ask you to fully consider all of the above terms and to obtain any advice you
feel is necessary, including legal advice, before you execute this Agreement.
Yours very truly,
PATCH INTERNATIONAL INC.
Per: /s/ XXXXX XXXXXXX
--------------------------------------
Authorized Signatory
ACCEPTED AND AGREED TO THIS 15TH DAY OF MAY, 2005. I HAVE READ AND UNDERSTAND
THE TERMS AND CONDITIONS SET OUT IN THIS LETTER AGREEMENT. I HAVE BEEN GIVEN
FULL OPPORTUNITY TO CONSULT LEGAL ADVISORS OF MY CHOOSING.
/s/ XXXXX XXXXXXX
---------------------------------
XXXXX XXXXXXX
