SECONDMENT SERVICES AGREEMENT
AMONG
NASCIT, GFS AND
XXXXXXXXXXX XXXXX
Page 39 of 258 Pages
DATED 7th January, 1993
-----------------------
CONSOLIDATED VENTURE TRUST PLC
and
GROWTH INVESTMENT MANAGEMENT LIMITED
and
XXXXXXXXXXX XXXXXXX XXXXXXX XXXXX
---------------------------------
SECONDMENT SERVICES AGREEMENT
---------------------------------
Xxxxx & Overy
London
THIS AGREEMENT is made on 7th January, 1993.
Page 40 of 258 Pages
(1) CONSOLIDATED VENTURE TRUST PLC of 00 Xxxxxxxxxx Xxxxxx, Xxxxxx XX0X 0XX
(the "Company");
-------
(2) GROWTH INVESTMENT MANAGEMENT LIMITED of 00 Xxxxxxxx Xxxxx, Xxxxxx XX0X 0XX
("GIM"); and
---
(3) XXXXXXXXXXX XXXXXXX XXXXXXX XXXXX of 00 Xxxxxxxx Xxxxx, Xxxxxx XX0X 0XX
(the "Executive").
-----------
NOW IT IS HEREBY AGREED as follows:
1. Interpretation
--------------
(a) In this Agreement:
"Administration, Management and Custody Agreement"
--------------------------------------------------
means an administration, management and custody agreement made on or about
the same date as this Agreement between the Company and XX Xxxxxx &
Partners Limited;
"Associated Company" means:
--------------------
(i) a company which is not a subsidiary of the Company but
whose issued equity share capital (as defined in
section 744 of the Companies Act 1985) is owned as to
at least 20 per cent. by the Company or one of its
Subsidiary Companies; and
(ii) a Subsidiary Company of a company within (a) above;
"Board of Directors"
--------------------
means the board of directors of the Company or a committee of the board of
directors of the Company;
"the Company"
-------------
includes each of its branches if any;
"Group"
-------
means the Company, and its Subsidiary Companies and Associated Companies
for the time being and "Group Company" means any one of them;
Page 41 of 258 Pages
"Investments"
-------------
includes any asset, right or interest falling within Part I of Schedule 1
of the Financial Services Xxx 0000 and any other asset, right or interest
in respect of property of any kind wherever situate whether or not
producing income;
"Shareholders' Funds"
---------------------
means the amount of the nominal capital of the Company for the time being
issued and paid up or credited as paid up, the amount repayable by the
Company in respect of any borrowings repayable more than three years after
initially made (but excluding convertible debt) and the amounts standing to
the credit of the consolidated capital and revenue reserves (including
without limitation share premium account, capital redemption reserve and
profit and loss account) of the Company and its Subsidiary Companies
properly reflected in an audited balance sheet of the Company prepared in
accordance with recognised accounting principles but after making such
adjustments as may be necessary to reflect:
(a) the Board of Directors' valuation of all unquoted investments in
accordance with a statement of value prepared for and approved by the
Board of Directors in accordance with procedures and on a basis
reviewed by the Company's auditors; and
(b) the payment of any dividend or the making of any other distribution to
shareholders of the Company.
"Subsidiary Company" means a subsidiary as defined by section 736 of the
Companies Xxx 0000; and
"Working Day" means a day other than a Saturday, Sunday or bank holiday or
other public holiday in England.
(b) References to persons include bodies corporate and unincorporated
associations and references to companies include any bodies corporate.
(c) Any reference to a statutory provision includes any statutory
modification or re-enactment of it for the time being in force.
(d) Subclauses (1) to (3) above apply unless the contrary intention
appears.
(e) The headings in this Agreement do not affect its construction.
(f) References to amounts payable shall be exclusive of value added tax
thereon so that value added tax shall be payable in addition if and to
the extent chargeable.
2. Services
--------
Page 42 of 258 Pages
(a) GIM shall provide the services of the Executive to the Company as
described and on the terms set out in this Agreement ("the Services").
The parties intend the Services to be provided by secondment of the
Executive from GIM to the Company.
(b) GIM shall employ the Executive for the purposes of enabling it to
provide the Services.
(c) The provision of the Services by GIM shall be deemed to take effect
from the date of execution of this Agreement ("the Commencement
Date").
(d) GIM and the Executive warrant to the Company that by entering into
this Agreement and performing the Services they will not be in breach
of any contract or other obligation binding on them.
3. Services of the Executive
-------------------------
(a) GIM shall, and shall procure that the Executive shall, use their best
endeavours to protect and further the interests of the Company giving
the full benefit of the Executive's knowledge and expertise.
(b) GIM shall procure that the Executive shall serve as chief executive
and director of the Company, subject to the Company appointing the
Executive as such.
(c) The Executive shall perform the functions from time to time assigned
to or vested in him by the Board of Directors and in particular he
shall be responsible (subject to such authorisation procedures as the
Board of Directors may specify and except to the extent that the Board
shall not require the services of the Executive in respect of all or
part of the Investments of the Company) for:
i. keeping under review the investments from time to time held
by the Company;
ii. deciding upon purchases and sales and other transactions in
respect of investments and subscriptions to issues of
investments, including underwriting commitments on behalf
of the Company and otherwise determining when the Company
should invest, realise and re-invest its assets and
exercise all rights attaching to its assets;
iii. searching out and evaluating investment opportunities for
the Company;
iv. analysing the progress of companies in which the Company
has invested;
Page 43 of 258 Pages
v. submitting to the Board of Directors such reports and
information regarding investments as the Board of Directors
shall reasonably require; and
vi. recommending to the Board of Directors any future
developments or changes to the investment policy of the
Company.
(d) The Executive shall faithfully serve the Company, and GIM shall
procure that the Executive shall devote 50 per cent. of his time
during normal business hours to the provision of the services and at
such additional times as are necessary for the proper fulfilment of
those services, but the Executive shall not be required to provide
such services at such times as he is on holiday (as provided for in
Clause 7), nor at such times (being not more than 90 Working Days in
any period of 12 consecutive months) when the Executive is
incapacitated by reason of illness or injury.
(e) GIM shall, and shall procure that the Executive shall, accept
appointments to such offices and enter into such agreements as the
Company shall deem reasonably necessary for the proper provision of
the Services.
(f) GIM shall, and shall procure that the Executive shall, disclose
forthwith to the Board of Directors any conflict of interest which may
arise in connection with the performance of the Services as a result
of any other present or future appointment, employment or interest of
GIM or the Executive (other than that which concerns a Group Company).
(g) The Executive shall provide the Services at such place or places as
the Board of Directors may reasonably require.
5. Fee
---
(1) The Company shall pay to GIM a fee to be agreed from time to time ("the
Fee") but so that the maximum fee payable under this sub-clause (exclusive
of Value Added Tax) when aggregated with the Management Fee (exclusive of
Value Added Tax) payable under the Administration, Management and Custody
Agreement (or any administration, management and custody agreement with
whomsoever made superseding that agreement) shall not in any financial
period of the Company exceed one per cent. of Shareholders' Funds of the
Company and its Subsidiary Companies on the last day of the preceding
financial period of the Company.
(2) For the avoidance of doubt, the Company shall not be obliged to provide the
Executive with, or reimburse GIM for the cost of providing the Executive
with medical insurance, life assurance, pension benefits, accident
insurance, permanent health assurance or other benefits except as expressly
provided for in this Agreement.
(3) The Fee shall accrue from day to day and be payable quarterly in advance on
31st January, 30th April, 31st July and 31st October in each year. The
first payment shall
Page 44 of 258 Pages
be a pro rata part of the quarterly fee for the period from the date of
this Agreement to the next quarter date. GIM shall reimburse the Company
for a pro rata part of any quarterly fee paid in advance in respect of any
period after termination of this Agreement.
(4) The Fee shall be exclusive of any fees receivable by the Executive as a
director of any Group Company.
(5) In addition to the Fee the Company shall pay to GIM a performance fee in
the amount and payable in the manner set out in the Schedule to this
Agreement ("the Performance Fee").
(6) The Company shall pay to the Executive (pounds)1 per annum (if demanded) as
consideration for his obligations under this Agreement.
6. Expenses
--------
(1) In addition to the Fee and Performance Fee the Company shall reimburse GIM
(on production of such vouchers or other evidence as the Company may
require) the amount of all travelling and other expenses properly and
reasonably incurred by the Executive in the provision of the Services.
(2) The Company shall provide the Executive with reasonably suitable office
accommodation and secretarial assistance at the offices of the Company or
such Group Company as may be appropriate so as to enable the Executive
properly to provide the Services but nothing in this Agreement shall be
construed or have effect as constituting any relationship of landlord or
tenant between the Company and GIM or the Executive and any use of such
office accommodation by GIM or the Executive shall be as bare licensee of
the Company.
7. Holidays
--------
(a) The Company acknowledges that the Executive is entitled to a maximum
of 30 Working Days' holiday in every calendar year under his service
agreement with GIM.
(b) GIM and the Executive agree that the Executive will take his holidays
at such times as are convenient to the Company.
8. Confidential Information
------------------------
(a) GIM and the Executive acknowledge that to enable them to provide the
Services and to discharge their responsibilities under this Agreement
the Company, and the Group, will provide them with information
relating to the Group of a highly confidential nature (any and all
information relating to the Company, the Group, and each Group
Company, their respective businesses, activities or customers,
including but without limitation all and any analyses, compilations,
Page 45 of 258 Pages
forecasts, studies or other documents, is referred to in this
Agreement as "Information").
(b) GIM and the Executive agree that they will adopt all such procedures
as the Company may require and that they will keep confidential all
Information and shall not, without the prior written consent of the
Board of Directors (save as required by law) disclose the Information
in whole or in part other than to the Board of Directors and to the
Company's professional advisers. GIM and the Executive shall not use
the Information other than in connection with the provision of the
Services. Notwithstanding the foregoing, GIM and the Executive agree
not to disclose the Information (save as required by law) to any
person except to the extent necessary to discharge their
responsibilities under this Agreement.
(c) Any document, including without limitation notes, memoranda, diaries,
correspondence, computer disks or copies thereof created by GIM or the
Executive in providing the Services shall be and remain the property
of the Company or such Group Company as appropriate and the Company or
such Group Company shall be the absolute beneficial owner of the
copyright in any such document.
(d) GIM and the Executive shall at any time during the continuance of this
Agreement if so required by the Company or any Group Company and in
the event of the termination of this Agreement (whether lawfully or
otherwise) surrender to the Company or such Group Company all original
and copy documents in their possession custody or control belonging to
the Company or Group Company or relating to the business of the
Company or any Group Company together with any other property
belonging to the Company or any Group Company.
(e) The obligations of GIM and the Executive under this Agreement apply to
all and any Information whether the Information was in or comes into
their possession prior to or following this Agreement and such
obligations shall be continuing obligations throughout the continuance
of this Agreement and at all times following its termination.
(f) GIM and the Executive agree to observe the laws and regulations which
may apply in the jurisdictions where the Company and the Group
Companies are located.
(g) GIM and the Executive understand and agree that any breach of their
obligations under this Clause 8 will cause the Company irreparable
injury and that monetary damages will not be an adequate remedy for
any such breach. In the event of any breach or threatened breach by
GIM or the Executive, the Company shall be entitled to injunctive
relief in any court of competent jurisdiction restraining GIM or the
Executive from such breach.
9. Gratuities and Codes of Conduct
-------------------------------
Page 46 of 258 Pages
(a) GIM and the Executive shall not directly or indirectly accept any
commission, rebate or other financial benefit from any person who has
or is likely to have a business relationship with any Group Company
without the consent of the Board of Directors.
(b) GIM and the Executive shall comply with all codes of conduct from time
to time adopted by the Company, and with all applicable rules and
regulations of the London Stock Exchange and any other relevant
regulatory authority including (without limitation) the Model Code for
Securities Transactions by Directors of Listed Companies.
10. Termination of Appointment
--------------------------
(a) This Agreement shall be for a period of 12 months from the
Commencement Date and shall continue for successive periods of 12
months provided that GIM or the Company may terminate this Agreement
at any time by giving to the other of them at least 12 months' notice
in writing expiring at any time (whether or not on the anniversary of
this Agreement).
(b) If:
i. the Executive ceases for any reason to be an employee of
GIM;
ii. the Executive becomes of unsound mind or is, or may be,
suffering from mental disorder and either:
(i) he is admitted to hospital for treatment under the Mental Health
Xxx 0000; or
(ii) an order is made by any competent court for his detention or for
the appointment of a receiver, curator bonis or other person to
exercise powers with respect to his property or affairs;
iii. the Executive is unable properly to perform his duties
under his service agreement with GIM by reason of ill-
health, accident or otherwise for a period or periods
aggregating at least 180 Working Days in any period of 12
consecutive months;
iv. GIM or the Executive fails or neglects efficiently and
diligently to discharge its duties, or GIM or the Executive
is guilty of any breach of their obligations under this
Agreement or any other agreement with a Group Company
(including any consent granted under any of them);
Page 47 of 258 Pages
x. XXX or the Executive is guilty of misconduct or suffers any
matter which (by reason of its effect on the Executive=s
reputation or otherwise) affects or is likely to affect
prejudicially the interests of the Company or the Group, or
the Executive is convicted of an arrestable offence (other
than a road traffic offence for which a non-custodial
penalty is imposed);
vi. the Executive becomes bankrupt or makes any arrangement or
composition with his creditors (other than as a result of
losses relating to his underwriting affairs in the Lloyds
insurance market);
vii. GIM becomes unable to pay its debts as they fall due or
makes any arrangement or composition with its creditors or
an order is made or any effective resolution is passed for
winding-up GIM; or
viii. the Executive is disqualified from being a director of any
company by reason of an order made by any competent court
the Company may by written notice to GIM terminate this Agreement with
immediate effect but:
(i) any such termination shall be without prejudice to any other rights
of the Company; and
(ii) a notice under sub-clause (c) may be given by the Company to GIM
only within 90 days after the end of any period or periods of
disability referred to in that sub-clause.
(c) On the termination of this Agreement in any way (whether lawfully or
otherwise) the Executive shall immediately resign all offices held
by him in any Group Company (without prejudice to the rights of any
party arising out of this Agreement or the termination of this
Agreement) and if he fails to do so the Company is irrevocably
authorised to appoint some person in his name and on his behalf to
do all such things and execute all such documents as may be
necessary, or incidental to, to give effect to his resignation.
11. Executive not an employee of the Company nor carrying on separate
-----------------------------------------------------------------
investment business
-------------------
(a) Nothing contained in this Agreement shall be construed or have
effect as constituting any relationship of employer and employee
between the Company
Page 48 of 258 Pages
and the Executive save that, for the purposes of Clause 8 only, the
Executive agrees to be subject to the same status as the employees
of the Company.
(b) The Executive shall at all times be an employee of GIM.
(c) GIM shall be responsible for the payment of any wages, Employers'
National Insurance and any other contributions required by law to be
paid by it as employer in relation to the Executive and shall make
all appropriate deductions from the Executive's wages in respect of
Income Tax (PAYE) and Employers' National Insurance contributions
and shall indemnify the Company in respect thereof.
(d) Nothing contained in this Agreement shall be construed or have
effect as either the Executive or GIM carrying on investment
business within the meaning of the Financial Services Xxx 0000, in
particular in relation to the functions described in Clause 3(3) of
this Agreement. The intent of the parties is that GIM will provide
the services of the Executive but neither GIM nor the Executive
shall be treated as providing independent investment management or
advisory services to the Company.
12. Guarantee
---------
(a) The Executive hereby unconditionally guarantees and undertakes to
the Company that GIM shall duly and punctually observe and perform
all the undertakings, covenants and obligations whatsoever of GIM
under this Agreement to the intent that if GIM shall fail for
whatever reason so to observe and perform any of such undertakings,
covenants and obligations the Executive shall be liable to perform
the same in all respects as if the Executive were principally bound
thereby.
(b) No time or other indulgence given by the Company to GIM nor any
neglect failure or forbearance on the part of the Company to enforce
the performance or observance of any of GIM=s undertakings,
covenants and obligations under this Agreement shall in any way
release or affect the liability of the Executive hereunder.
13. Indemnity
---------
The Company shall, insofar as it is permitted by any applicable law,
indemnify GIM and the Executive against any costs, claims or liabilities
incurred as a result of the Executive being a director or an officer of any
Group Company or his being held out to any person as a director or officer
of any such company.
14. General
-------
(a) Neither GIM nor the Executive shall assign or otherwise transfer any
of its or his rights nor sub-contract or otherwise transfer any of
its or his obligations under this Agreement. If the Company
transfers the whole or a substantial part
Page 49 of 258 Pages
of its undertaking and property to another company as part of a
reconstruction or amalgamation, the Company may by written notice to
GIM transfer all its rights and obligations under this Agreement to
that other company.
(b) This Agreement shall be governed by and construed in accordance with
English law. The parties irrevocably submit to the jurisdiction of
the English courts.
15. Notices
-------
Any notice to be served under this Agreement may, in the case of the
Company be delivered or sent by first class post to the Company at its
registered office for the time being and, and in the case of GIM or the
Executive, may be delivered to the Executive or sent by first class post to
the Executive's usual or last known place of residence. Notices served by
first class post shall be deemed duly served twenty-four hours after
posting and proof of posting shall be proof of delivery.
IN WITNESS of which each of the parties has executed this Agreement on the date
first mentioned on page 1.
Page 50 of 258 Pages
SCHEDULE
--------
The Performance Fee
-------------------
The Performance Fee referred to in Clause 5(5) of the Agreement shall be
calculated and payable as follows:
1. As further consideration for the performance of the Services, GIM shall be
entitled to receive on 1st July in each year a Performance Fee which shall
be calculated as the amount equivalent to a percentum of Funds (as
calculated below) of the Company as at 31st March each year (an in respect
of any period, to which this Agreement applies, of less or more than twelve
months the Performance Fee shall be decreased or (as the case may be)
increased in proportion to the amount by which the period in question is
less than 365 days or exceeds 365 days, as the case may be).
2. In the event of any change in the financial year end of the Company from
31st January in any year, the period covered by this Schedule shall be
altered so that any current period the subject of this Schedule shall
expire on the date falling two calendar months after the date of the new
financial year end of the Company and so that:
(a) any such new period covered by this Schedule shall always commence on
the date falling two calendar months and one day after the expiry of
the financial period of the Company;
(b) payment pursuant to paragraph 1 above shall be made on the date
falling six calendar months and one day after the new financial year
end date of the Company;
(c) all references to 31st March in this Schedule shall then be deemed to
apply to the date falling two months after the new financial year end
of the Company; and
(d) in the event of any further change in the financial year end of the
Company the provisions of this sentence shall apply "mutatis
mutandis".
3. In addition, if the appointment of GIM under this Agreement terminates
otherwise than on 31st March (or such date on which the relevant twelve
month period ends) GIM shall be entitled to a proportionate part of the fee
which would have been payable to it if the appointment had been effective
during the whole of the twelve month period in question.
4. Such percentum will be calculated from the fraction arising in accordance
with the following formula:
(A - 1) x 0.1
--
Page 51 of 258 Pages
(B )
Where
A - Funds at 31st March in any calendar year ("Relevant Year Date")
___________________________________________________________________
Funds at 31st March in the immediately preceding calendar year ("Preceding
Year Date")
the Standard & Poors' rate of exchange of
Composite Index at US$ per (Pounds)1 at the
B - the Relevant Year End Preceding Year Date
--------------------- -------------------
x
the Standard & Poors' rate of exchange of
Composite Index at US$ per (Pounds)1 at the
the Preceding Year Date Relevant Year Date
Provided always that the percentum shall not be less than nil and not
greater than 0.5 per cent.
5. In the event of the issue of new shares, debentures or other loan capital
by the Company for value or in the event of any shares, debentures or other
loan capital of the Company being repaid during the relevant period, item A
shall be adjusted as the Board of Directors may determine and the Company's
auditors shall confirm as fair and reasonable.
6. In the event of any dispute between GIM and the Board of Directors as to
the value to be attributed to the Investments or any of them pursuant to
these provisions the value shall be determined by the auditors of the
Company acting as experts and not as arbitrators and their valuation shall
be final and binding upon the parties and the provisions of paragraph 7
below shall apply to the calculation of the Performance Fee.
7. For the purposes of this Schedule the expression "Funds" shall mean the
amount of the nominal capital of the Company for the time being issued and
paid up or credited as paid up and the amounts standing to the credit of
the consolidated capital and revenue reserves (including without limitation
share premium account, capital redemption reserve fund and profit and loss
account) of the Company and its subsidiaries at the date on which the
calculation is required to be made based on the last audited balance sheet
of the Company but after making such adjustments as may be necessary to
reflect:
(a) realised profits or losses arising in respect of the period from the
date of the last audited balance sheet to the date of the calculation;
Pages 52 of 258 Pages
(b) the Board of Directors' valuation of all unquoted investments on such
date of calculation in accordance with a statement of value prepared
for and approved by the Board of Directors in accordance with
procedures and on a basis reviewed by the Company's auditors;
(c) the payment of any dividend or the making of any other distribution to
shareholders of the Company.
8. Subject to the provisions of this Schedule the Performance Fee shall be
paid on 1st July in respect of the twelve month period commencing on 1st
April in the preceding calendar year and ending on 31st March in the
current calendar year.
Page 53 of 258 Pages
SIGNED by X. Xxxxxx ) /s/ X. Xxxxxx
on behalf of CONSOLIDATED )
VENTURE TRUST PLC )
in the presence of: )
SIGNED by C.H.B. Xxxxx ) /s/ Xxxxxxxxxxx Xxxxx
on behalf of GROWTH INVESTMENT )
MANAGEMENT LIMITED )
in the presence of: )
SIGNED by XXXXXXXXXXX XXXXXXX ) /s/ Xxxxxxxxxxx Xxxxx
XXXXXXX XXXXX )
in the presence of: )
(E13971013)
