MANAGEMENT AGREEMENT
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This Management Agreement ("Agreement") entered into effective January
1, 1997, by and between CAN-AM INTERNATIONAL INVESTMENT CORP., a British
Columbia corporation ("CAN- AM") and J&M WHOLESALE, LTD., a British Columbia
corporation ("J&M").
WHEREAS, CAN-AM desires to engage J&M to manage certain of CAN-AM's
operations; and
WHEREAS, J&M desires to provide certain management services to CAN-AM;
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Duties. CAN-AM agrees to retain J&M to manage certain of CAN-AM's
operations. J&M shall at all times exercise its best efforts in the performance
of its duties.
2. Operational Expenses; Reimbursement. J&M, may, during the term of
this Agreement, finance certain of the operational expenses of CAN-AM. CAN-AM
recognizes that a substantial portion of J&M's own operational expenses during
the term of this Agreement may be related to CAN-AM operational expenses as a
substantial portion of J&M's activities during such term may be related to
managing CAN-AM's operations. CAN-AM shall reimburse J&M all of J&M's expenses
which are directly incurred in the provision of services to or on behalf of
CAN-AM, provided that J&M provides CAN-AM with such verification as CAN-AM shall
require of the percent of J&M's operations which are related to CAN-AM. In no
event shall J&M be paid any additional sum, fee or commission other than as set
forth herein. The parties agree that any reimbursement due under this Agreement,
may, at CAN- AM's sole discretion, be paid in cash or as a non-cash offset
against any related-party receivable payable to J&M by CAN-AM.
3. Term of Agreement. The term of this Agreement shall commence as of
January 1, 1997 and shall continue in effect unless otherwise terminated, as
provided herein.
4. Termination. This Agreement may be terminated at any time by CAN-AM
upon thirty (30) days written or oral notice to J&M. This Agreement may be
terminated by J&M by delivering to CAN-AM written notice of termination, at
least 60 days prior to the date of termination. Upon termination, J&M shall
surrender control of all CAN-AM property and operations.
5. Nature of Relationship. Notwithstanding anything which may be
contained herein to the contrary, the parties hereto acknowledge that J&M's
relationship arising under this Agreement is that of an independent contractor
and not that of officer, employee, agent or partner of CAN-AM. J&M shall take no
action beyond the scope of the authority specifically conferred upon him by this
Agreement. J&M shall not participate in any employee benefit plans, insurance
arrangements or any other programs available to employee of CAN-AM which are
presently in effect or may, from time to time, be established in the future, and
CAN-AM shall not be obligated or authorized to make any withholding, FICA or
other deductions on J&M's behalf.
6. Customer Records. J&M acknowledges that the list of CAN-AM's
customers or clients as it may exist from time to time is a valuable, special
and unique asset of CAN-AM's business. J&M
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shall not, during or after such period of time as this Agreement is in effect,
divulge, furnish or make accessible to anyone (other than in the regular course
of CAN-AM's business) any names, addresses or telephone numbers of those
individuals who maintain accounts at CAN-AM. In addition, the contents of
customers' files, or any other such information, shall be kept confidential
during and after the term of this Agreement. All original records and all copies
thereof of those customers who maintain accounts at CAN-AM, including names,
addresses, telephone numbers or any other such information, as well as all other
secrets and confidential information of CAN-AM shall remain the property of
CAN-AM during and after the term of this Agreement. The terms of this Section
shall survive any termination of this Agreement.
In the event of a breach or threatened breach by J&M of the provisions
of this Section or Section 7 hereof, CAN-AM shall be entitled to an injunction
restraining J&M from disclosing, in whole or in part, the list of CAN-AM's
customers or other confidential information, or from rendering any services to
any person, firm, company, association, or other entity to whom such list or
other confidential information, in whole or in part, has been disclosed or is
threatened to be disclosed. Additionally, CAN- AM shall be entitled to an
injunction restraining J&M from taking any act or making any disclosure which
would affect CAN-AM's status as an owner or licensee of any intellectual
property rights. Nothing herein shall be construed as prohibiting CAN-AM from
pursuing any other remedies available to CAN- AM for such breach or threatened
breach, including the recovery of damages from J&M.
7. Confidential Information. J&M has in the past and may in the future
develop, obtain or learn about confidential information which is the property of
CAN-AM or which CAN-AM is under obligation not to disclose. J&M agrees to use
its best efforts and the utmost diligence to guard and protect said confidential
information, and J&M agrees that J&M will not, during or after the period of its
performing services for CAN-AM, use for J&M or others, or divulge to others any
of said confidential information which J&M may develop, obtain or learn about
during or as a result of performing services for CAN-AM, unless authorized to do
so by CAN-AM in writing. J&M further agrees that if this Agreement is terminated
for any reason, J&M will not take, but will leave with CAN-AM or return to
CAN-AM, records and papers and all matters of whatever nature which bear
CAN-AM's confidential information.
For the purposes of this Agreement, the terms "confidential
information" shall include executable software, source code and all documents
relating thereto, memoranda, notes, records, sales information, manuals,
processes, technology, proprietary information, patents, designs, methods,
techniques, trade secrets, systems, patterns, models, devices, compilations,
lists of customers or any information of whatever nature which gives to CAN-AM
an opportunity to obtain an advantage over its competitors who do not know or
use it, but it is understood that said terms do not include knowledge, skills or
information which is common to the trade or profession of J&M.
8. Assignability. The skills and obligations of J&M hereunder are
unique and may not be substituted without the prior express written consent of
CAN-AM.
9. Notices. All notices provided for by this Agreement shall be made in
writing either (i) by actual delivery of the notice into the hands of the
parties thereunto entitled or (ii) the mailing of the notice in the United
States' mail to the address, as stated below (or at such other address as may
have been designated by written notice) of the party entitled hereto, by
certified or registered mail, return receipt requested. The notice shall be
deemed to be received on the date it is placed for delivery with the
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United States Postal Service. All communications hereunder shall be in writing
and sent to the addresses on the signature page.
10. Miscellaneous.
a. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Arizona.
b. Amendment and Waiver. No amendment, waiver or modification
of this Agreement shall be valid unless in writing and duly executed by the
party to be charged therewith. Waiver by either party hereto of any breach or
default by the other party of any of the terms and provisions of this Agreement
shall not operate as a waiver of any other breach or default, whether similar or
to different from the breach or default waived.
c. Severability. All agreements, provisions, representations,
warranties and covenants contained herein are severable, and in the event that
any one or more of them shall be held to be invalid, illegal or unenforceable in
any respect by any court of competent jurisdiction, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected hereby, and this Agreement shall be interpreted as if such invalid,
illegal or unenforceable agreements, provisions or covenants were not contained
herein.
d. Gender. Whenever the context required, the masculine shall
include the feminine and neuter.
e. Entire Agreement. This Agreement constitutes and embodies
the full and complete understanding and agreement of the parties hereto
provided, and supersedes all prior understandings or agreements, whether oral or
in writing.
f. Arbitration. In the event of any dispute between the
parties as to the interpretation of any of the terms and provisions of this
agreement, the matter shall be submitted to arbitration in the following manner:
Either party shall serve written notice upon the other party that they
desire to submit the dispute to arbitration and within fifteen (15) days of the
date of any such written notice, each party shall appoint an arbitrator. Within
ten (10) days thereafter the two arbitrators so selected shall appoint a third.
In the event either party shall fail to appoint an arbitrator within such
fifteen-day period or if the two arbitrators so appointed shall fail to select a
third within such ten-day period, then a judge of the Superior Court of Maricopa
County or such other court as may have jurisdiction thereover shall appoint such
arbitrator. The three arbitrators shall determine the controversy in accordance
with the Rules of the American Arbitration Association and a decision of the
majority of the arbitrators shall bind and be conclusive upon the parties. The
parties shall pay the expense of arbitration in the manner determined by the
arbitrators and judgment upon the award rendered by the arbitrators may, if
permissible, be entered in any court having jurisdiction thereover.
g. Successors and Assigns. This Agreement shall inure to the
benefit of and shall be binding on and enforceable by the parties and their
respective successors and permitted assigns, as the case may be.
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h. Execution and Counterparts. This Agreement may be executed
in counterparts, each of which shall constitute an original and all of which
taken together shall constitute one and the same instrument.
i. Attorneys' Fees. In the event of the bringing of any action
or suit by a party hereto against another party hereunder by reason of any
breach of any of the covenants, agreements or provisions on the part of the
other party arising out of this Agreement, then in that event the prevailing
party shall be entitled to have and recover from the other party all costs and
expenses of the action or suit, including attorneys' fees and costs.
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first written above.
"CAN-AM" "J&M"
CAN-AM INTERNATIONAL J&M WHOLESALE, LTD.
INVESTMENT CORP. a British Columbia corporation
a British Columbia corporation
By /s/ Colin A. Jones By /s/ Colin A. Jones
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Colin A. Jones, President Colin A. Jones, President
15651 North 83rd Way 102, 4463 Byrne Road
Building C, Suite 3 Burnaby, British Columbia, Canada
Scottsdale, Arizona 85260 V5J 3H6
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