THIS AGREEMENT made as of this 24th day of September, 1998
BETWEEN:
SSA COUPON LTD., a company duly incorporated and validly existing
under the laws of British Columbia having its registered and
records offices at 1230B 4700 Kingsway, Burnaby, British
Columbia, VSH 4M1
(the "Company")
OF THE FIRST PART
AND:
MAURICE SIMPSON, businessman, of #401 1 1310 Cariboo Street,
Burnaby, British Columbia, V3M 1 X2
("Maurice")
OF THE SECOND PART
WHEREAS
A. The Company was incorporated by Maurice for the purpose of developing,
exploiting and marketing an internet web search engine and data base as an
internet portal (the "Project").
B. Maurice was the originator of the concept has been instrumental in
developing the concept for the search engine and data base and working with the
programmers and others and Maurice desires to pursue his involvement with the
Company in a consulting capacity.
C. The Company desires to retain the services of Maurice on a long term
basis in accordance with the term and conditions set forth in this Agreement.
WITNESSETH that in consideration of the premises herein contained and
subject to the terms and conditions hereinafter set out the parties hereto agree
as follows:
1. Maurice shall serve the Company as a consultant to provide his creative ideas
and insight in programming, extending, modifying and marketing the Project
subject to such general policy restrictions and such restrictions as to specific
matters as may be established by the Board of Directors of the Company.
2. The term of this Agreement shall be five years from the date first above
written and shall continue and shall not be terminated by the Company for any
reason or cause whatsoever and the said term shall be automatically renewed for
successive terms of two years each unless terminated by Maurice at any time on
three months notice or unless the Company shall deliver to Maurice written
notice of the termination of this Agreement at least six calendar months prior
to the expiration of the original term of five years or prior to the expiration
of any successive two year term then in force. If the Company shall cancel this
Agreement at the end of the said five
year term or at the end of any successive two year term then in force, the
Company shall pay to Maurice, on the termination of this Agreement as provided
herein, the sum of $2,000,000.00 forthwith upon such termination.
3. During the original term of this Agreement and successive renewal terms
thereof , the Company shall pay to Maunce as a consulting fee, commensurate with
the earnings of the Company (calculated without deducting as an expense, any
fees, bonuses or other amounts paid to Maurice, Dana Herbert Shaw, Maurice, or
any other director, officer, or executive of the Company), amounts calculated as
follows:
(a) commencing on October lst 1998 and continuing until the
Company has net quarterly earnings of $250,000 calculated in
accordance with generally accepted accounting principals
("GAAP"), $6,000 per month in two installments of $3,000 each
on the 1st and 15th day of each and every month until the
month immediately following the first calendar quarter in
which the Company had net quarterly earnings of $250,000 as
aforesaid and provided that until such time as the Company has
money available to make such payments, the amounts shall be
recorded in the books of the Company as a debt owing to
Maurice to be paid as soon as the Company has money available
and provided that,
(b) from the 1st of the month immediately following the first
calendar quarter that the Company has net quarterly earnings
of $250,000 calculated in accordance with GAAP as aforesaid
and continuing until the month immediately following the first
calendar quarter in which the Company has net quarterly
earnings of $500,000 calculated in accordance with GAAP, the
Company will pay to Maurice, in lieu of the $6,000 per month,
$8,000 per month in two installments of $4,000 each on the 1st
and 15th days of each and every month and provided that,
(c) from the lst of the month immediately following the first
calendar quarter that the Company has net quarterly earnings
of $500,000 calculated in accordance with GAAP as aforesaid
until the month immediately following the first calendar
quarter in which the Company has net quarterly earnings of
$1,000,000 calculated in accordance with GAAP, the Company
will pay to Maurice, in lieu of the $8,000 per month, $12,000
per month in two installments of $6,000 each on the 1st and
15th days of each and every month and provided that,
(d) from the lst of the month immediately following the first
calendar quarter that the Company has net quarterly earnings
of $1,000,000 calculated in accordance with GAAP as aforesaid
until the month immediately following the first calendar
quarter in which the Company has net quarterly earnings of
$3,000,000 calculated in accordance with GAAP, the Company
will pay to Maurice, in lieu of the $12,000 per month, $16,000
per month in two installments of $8,000 each on the 1st and
15th days of each and every month and provided that,
(e) from the 1st of the month immediately following the first
calendar quarter that the Company has net quarterly earnings
of $3,000,000 calculated in accordance with GAAP as aforesaid
until the month immediately following the first calendar
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quarter in which the Company has net quarterly earnings of
$6,000,000 calculated in accordance with GAAP, the Company
will pay to Maurice, in lieu of the $16,000 per month, $24,000
per month in two installments of $12,000 each on the 1st and
15th days of each and every month and provided that,
(f) from and after the first of the month immediately following
the first calendar quarter that the Company has net quarterly
earnings of $6,000,000 calculated in accordance with GAAP as
aforesaid, the Company will pay to Maurice, in lieu of the
$24,000 per month, $44,000 per month in two installments of
$22,000 each on the 1st and 15th days of each and every month.
Thereafter such compensation shall be reviewed from time to time by the board of
directors, no less than annually, and may be increased as the board of directors
in their discretion may decide. The above compensation is in addition to any
bonuses, stock options or shareholders dividends that Maurice may receive in the
discretion of the Board of Directors of the Company.
4. Maurice shall devote the at least one half of his working time, attention and
ability to the business and affairs of the Company unless otherwise consented to
in writing by the Board of Directors and shall use his best efforts to promote
the interests of same.
5. During the term or any successive term hereof Maurice shall be entitled to a
vacation of eight weeks during each year, such vacation to be taken at such time
or times as the Board of Directors of the Company may agree.
6. Maurice shall be reimbursed for all travelling and other expenses properly
incurred by him in connection with his duties hereunder and for all such
expenses shall furnish to the Company, as appropriate, statements and vouchers
as and when required.
7. Maurice shall submit oral or written reports in such form and to such persons
as the Board of Directors of the Company may from time to time direct.
8. Maurice confirms that he has transferred all right, title and interest that
he may have in the intellectual property of the Project to the Company and
Maurice shall not, without the consent of the Board of Directors of the Company,
either during the continuance of this Agreement employment hereunder or at any
time thereafter disclose the private affairs or any secrets of the Company to
any person other than the Directors or Senior Officers of the Company and shall
not use for his own purposes or for any purpose other than those of the Company
such information he may now have or may hereafter acquire in relation to the
business or affairs of the Company.
9. Maurice shall not without the prior written consent of the Board of Directors
of the Company for a period of one year after the termination of this Agreement
either individually or in partnership or in conjunction with any person or
persons, association, syndicate, company or corporation as principal, agent,
major shareholder or in any other manner whatsoever carry on or be engaged in or
be concerned with or interested in or advise or permit his name to be used or
employed by any person or persons, firm, association, syndicate, company or
corporation engaged in or concerned with or interested in any of the businesses
carried on by the Company during the term of this Agreement within the Province
of British Columbia.
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10. If Maurice shall, by reason of illness or mental or physical disability or
incapacity, fail for six months in the aggregate, to perform his duties
hereunder the Company may, by three months' notice in writing to Maurice,
terminate this Agreement, in which event this Agreement (except paragraphs 8 and
9 hereof, which paragraphs shall continue in force) shall be wholly determined
upon the expiration of the said period of two months and the Company's further
obligation to pay compensation to Maurice under paragraph 3 and Maurice's
obligation to render services hereunder shall terminate as of the said
termination date.
11. The provisions of this Agreement shall enure to the benefit of and be
binding upon the legal personal representative of Maurice and the successors and
assigns of the Company respectively.
12. If any covenant or provision herein is determined to be void or
unenforceable in whole or in part it shall not be deemed to affect or impair the
validity of any other covenant or provision hereof.
13. The relationship of the parties is as contractor and contractee and not as
employer and employee and nothing herein contained shall be deemed to constitute
an employer-employee relationship or a partnership between, or a joint venture
by, the parties and neither party shall hold itself out contrary to the terms of
this paragraph by any means whatsoever. Neither party shall be bound by or
become liable for any representation, commitment, act or omission whatsoever of
the other contrary to the provisions hereof.
14. The parties acknowledge that it is their intent to take the Project public
either by licensing the technology to, or vending the Company or the shares in
the Company into a company ("Newco") that is listed, or intends to become
listed, on a recognized stock exchange or is trading, or intends to be traded,
on the over the counter market, and the Company covenants that any such license
or vending it will be conditional on Newco assuming the obligations hereunder
and the Company will assign this Agreement to Newco on the licensing or vend in
and will ensure that Newco assumes the Company's obligations to Maurice
hereunder. After such a licensing or vend in, the net earnings referred to in
paragraph 5 shall be the consolidated earnings of the Company and Newco. This
paragraph will apply, mutatis mutandis, if it is decided that Newco will not be
the public company but shall sell the shares or the Project to another company
that is listed, or intends to become listed, on a recognized stock exchange or
is trading, or intends to be traded, on the over the counter market.
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IN WITNESS WHEREOF the parties hereto have hereunto set their hands and
seals the day and year first above written.
THE CORPORATE SEAL of )
SSA COUPON LTD. was hereunto )
affixed in the presence of )
) c/s
/s/ William Murray, Pres. )
- - -------------------------------
)
)
SIGNED, SEALED AND DELIVERED )
by MAURICE SIMPSON )
in the presence of: )
)
/s/ William Murray )
- - ------------------------------- )
Name )
) /s/ Maurice Simpson
) ----------------------------------
- - ------------------------------ ) MAURICE SIMPSON
Address )
)
)
- - -------------------------------- )
Occupation )
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