CONSULTING AGREEMENT Between ENTRÉE GOLD INC. - and - PRIMORIS GROUP INC. Date: October 31, 2003
Between
ENTRÉE GOLD INC.
- and -
PRIMORIS GROUP INC.
Date: October 31, 2003
THIS CONSULTING AGREEMENT made as of the 31st day of October 2003.
BETWEEN:
ENTRÉE GOLD INC.
a corporation continued pursuant to the laws of the
Yukon Territory and having its head office at
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Fax: (▇▇▇)▇▇▇-▇▇▇▇
(hereinafter referred to as the "Company")
OF THE FIRST PART
AND:
PRIMORIS GROUP INC.
a corporation incorporated pursuant to the laws of the
Province of Ontario and having its head office at
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Tel: (▇▇▇)▇▇▇-▇▇▇▇
Fax: (▇▇▇)▇▇▇-▇▇▇▇
(hereinafter referred to as the "Consultant")
OF THE SECOND PART
WHEREAS the Company wishes to engage the Consultant to provide certain investor relations services for the Company's business and the Consultant has agreed to provide such services to the Company.
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the mutual covenants and agreements herein contained and for other good and valuable consideration, it is hereby agreed by and between the parties as follows:
1.0 Definitions
For the purpose of this Agreement, the following terms shall have the following meanings:
"Agreement" means this agreement and all schedules attached hereto and all amendments and modifications made by written agreement.
"Consulting Services" shall mean the corporate, media and investor relations services relating to the Company's business, products, and services of the Company to be provided by the Consultant as summarized in Schedule A attached hereto, and in particular but without restricting the generality of the foregoing, includes arranging contacts and meetings, arranging attendance or representation of the Company at conferences and, subject to the control and direction of the Company, preparing corporate and product related materials for distribution to media, shareholders, brokers, analysts, investment advisers and investors, and distributing same to media, shareholders, brokers, analysts, investment advisors and investors.
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"Licensed Marks" means the licensed and unlicensed trademarks, trade names and logos owned or licensed by the Company and used in connection with the Company's business.
2.0 Engagement
2.1 The Company hereby engages the Consultant to provide the Consulting Services. The Consultant hereby accepts the engagement by the Company and hereby agrees to provide the Consulting Services subject to the terms and conditions hereinafter contained and subject to obtaining all necessary regulatory approval hereto.
3.0 Term
3.1 The term of this Agreement shall be for a period of eighteen months, commencing on the 1st day of November 2003 and, subject to the termination provisions contained herein, terminating on April 30, 2005. Notwithstanding anything contained herein to the contrary, the Consultant shall only provide the Consulting Services described herein and the Company shall only compensate the Consultant in accordance with section 6 of this Agreement until October 31, 2004. Between October 31, 2004 and April 30, 2005 the Consultant shall provide such of the Consulting Services as may be requested by the Company from time to time and agreed to by the Consultant, for such compensation as may be agreed to by the Company and the Consultant. This Agreement may be renewed for such subsequent term and with such amendments as may be agreed to in writing by the Company and the Consultant.
4.0 Consultant's Obligations and Indemnity
4.1 The Consultant agrees that during the term of this Agreement, it shall:
a) provide such of the Consulting Services to the Company in the manner as the Company and the Consultant may reasonably agree from time to time in writing;
b) use such of its effort, skill, attention and resources to properly render the Consulting Services to the Company;
c) subject to the terms herein, provide materials relating to the Company's business to persons requesting information about the Company in a manner consistent with the provision of the Consulting Services;
d) provide the Consulting Services on a basis which does not impair the activities and business interests of the Company;
e) perform the Consulting Services in accordance with all applicable laws, including but not limited to, applicable securities rules and regulations and the rules and policies of any stock exchange or stock quotation service on which the Company's securities are traded or quoted.
4.2 The Company acknowledges that it is aware the Consultant has outside business activities, duties and financial interests. The Company agrees that the performance by the Consultant of such activities and duties and involvement in such financial interests shall not be construed as a conflict of interest of the Consultant's obligations set out in this Agreement.
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4.3 In the course of providing the Consulting Services hereunder, the Consultant shall be entitled to rely upon information received from the Company, and shall so disclose this fact in all communications.
4.4 The Consultant shall be responsible for the management and remuneration of its employees and agents, including without limiting the generality of the foregoing, the payment to the proper authorities of all employee and employer taxes, insurance premiums, pension plan contributions, worker's compensation premiums and all other employment expenses for all of the Consultant's employees. Consultant agrees to maintain appropriate business loss and liability insurance during the term this Agreement.
4.5 The Consultant agrees to indemnify and save the Company harmless with respect to any claim, suit, proceedings or judgement, whether regulatory or of a court of competent jurisdiction, arising from any breach of the Agreement by the Consultant or any liability that the Company may incur to any authority as a result of the Consultant's failure to remit applicable taxes charged and collected from the Company in accordance with section 10.5 hereof. The Consultant's indemnity given hereunder shall survive the termination of this Agreement.
5.0 Company's Obligations and Indemnity
5.1 The Company hereby agrees that during the term of this Agreement it shall provide, at the expense of the Company, the Consultant with such information, resources (which includes Company staff members), financial records, documents, product information and materials relating to the Company's business as reasonably requested from time to time by the Consultant, and which the Company is willing to disclose and provide, in order for the Consultant to provide the Consulting Services in the manner contemplated by this Agreement.
5.2 In the event of any act or omission by the Company or those at law for which it is responsible during the term of this Agreement that results in any loss or liability to the Consultant arising out of any claims against the Consultant as a result of such act or omission by the Company, including without limiting the generality of the foregoing any misstatements, misrepresentations or omissions in information as provided by the Company to the Consultant and as utilized by the Consultant in the performance of the Consulting Services, the Company agrees to indemnify and save harmless the Consultant against any such claims or liabilities, except for those claims or liabilities arising out of or resulting from the negligence or misconduct of Consultant. The Company's indemnity given hereunder shall survive the termination of this Agreement.
6.0 Compensation
6.1 In consideration of the provision by the Consultant of the Consulting Services to the Company, the Company agrees to pay the Consultant, the sum of Nine Thousand Two hundred ($9,200) Canadian Dollars per month payable in advance of the month in which services are to be rendered.
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6.2 The Company agrees to pay the Consultant the sum of Eighteen Thousand Four Hundred ($18,400) Canadian Dollars upon execution of this Agreement, such sum representing payment for the first and last months of services to be provided under this Agreement.
6.3 The Company agrees to reimburse the Consultant on a monthly basis for approved expenses to be incurred by or on behalf of the Company pursuant to the Consulting Services including reasonable disbursements for travel and accommodation expenses, printing and mailing costs, long-distance charges, outside services, and all other out-of-pocket expenses incurred by the Consultant in the performance of its obligations pursuant to this Agreement, provided that the Consultant shall not incur any expenditure that exceeds C$2,500 without obtaining the prior consent of the Company. The Company agrees to pay any approved outstanding expenses prior to termination of this Agreement.
6.4 Notwithstanding Section 6.3, the Company further agrees to pay in advance any single expenditure in excess of C$2,500, upon prior written consent, if requested to do so by the Consultant.
6.5 In addition to the compensation and expense reimbursements detailed in Sections 6.1 through 6.4 inclusive, the Company shall, upon execution of this Agreement and subject to the approval of the Company's board of directors, issue to the Consultant an option to purchase 210,000 common shares of the Company at a price of C$2.21 per share (being the closing trading price of the Company's shares on TSX Venture Exchange (the "Exchange") on October 31, 2003) exercisable for a period of three (3) years. The option shall be issued under and subject to the terms and conditions of the Company's stock option plan, a copy of which shall be delivered to the Consultant. The Consultant acknowledges that while the Company is a Tier II issuer on the Exchange, notwithstanding anything else to the contrary, (a) the option and any shares issued on the exercise of the option shall be subject to a four-month Exchange hold period commencing on the date of issuance of the option; and (b) any vested portion or portions of the option shall expire 30 days following the termination of this Agreement, unless this Agreement is terminated by the Company pursuant to section 7.2 hereof, in which case the vested portion or portions of the option shall expire immediately. While the Company is a Tier II issuer on the Exchange, the option shall vest as follows: the right to purchase 1/4 of the shares subject to the option shall vest on the date of issue and the right to purchase an additional 1/8 of the shares shall vest every three months thereafter. In the event the Company graduates to a Tier I issuer, the vesting schedule shall be amended such that the right to purchase 1/3 of the shares subject to the option shall vest or have vested four months following the date of issuance of the option and the right to purchase an additional 1/3 of the shares shall vest every four months thereafter. The Company agrees that the Consultant may elect to exercise the option in whole or in part on one or more dates subject to the limitation that the total number of shares purchased under the option shall not exceed 210,000. The Company agrees to make all necessary legal and regulatory filings to enable the issuance of the option to the Consultant and to ensure any shares purchased by the Consultant, through the exercise of vested options, can be resold without restriction.
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7.0 Termination
7.1 This Agreement will automatically terminate upon the expiry of the term. Either party may terminate this Agreement prior to the expiry of the term by providing the other party with at least sixty (60) days written notice, provided the written notice is delivered before September 1, 2004.
7.2 Either party may terminate this Agreement at any time without notice to the other party if the other party becomes insolvent or commences proceedings or any proceedings are commenced against it under any bankruptcy, insolvency or creditor protector legislation or the other party does not remedy any breach of this Agreement within the time period allowed for in writing for the remedy of any such breach.
7.3 Upon termination of this Agreement, Consultant shall return to the Company all material that is the property of the Company.
8.0 Relationship
8.1 The Consultant shall at all times be an independent contractor and not the servant or agent of the Company. No partnership, joint venture or agency shall be created or shall be deemed to be created by this Agreement or by any action of the parties under this Agreement. The Consultant shall not represent itself as an agent, servant or employee of the Company. The Consultant shall be an independent contractor with control over the manner and means of its performance. Neither the Consultant nor its employees or agents shall be entitled to rights or privileges applicable to employees of the Company including, but not limited to, liability insurance, group insurance, pension plans, holiday paid vacation and other benefit plans which may be available from time to time between the Company and its employees.
9.0 Confidentiality and Use of Licensed Marks
9.1 The Consultant shall not, directly or indirectly, use, disseminate, disclose, communicate, divulge, reveal, publish, use for its own benefit, copy, make notes of, input into a computer data base or preserve in any way any Confidential Information relating to the Company or its subsidiaries, associates or affiliated Company's whether during the term of this Agreement or thereafter, unless it first received written permission to do so from an authorized officer of the Company.
9.2 For the purposes of this Agreement, "Confidential Information" is information disclosed to or acquired by the Consultant relating to the business of the Company, or its subsidiaries, associates or affiliated Companies, their projects or the personal affairs of their directors, officers and shareholders, including information developed or gathered by the Consultant which has not been approved by the Company for public dissemination. Confidential Information does not include information in the public domain, information released from the provisions of this Agreement by written authorization of an authorized officer of the Company, information which is
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part of the general skill and knowledge of the Consultant and does not relate specifically to the business of the Company, and information which is authorized by the Company to be disclosed in the ordinary course or is required by law or applicable regulatory policy to be disclosed.
9.3 The Consultant shall consult with the Company before disseminating any information, including issuing any press release or making any public statement contemplated hereby and shall not issue any such press release or make any such public statement without the prior written consent of the Company.
9.4 Consultant agrees that all work performed under this Agreement, and all materials made, conceived, expressed, developed, or actually or constructively reduced to practice by Consultant solely or jointly with others in connection with any services under this Agreement ("Work Product") are Confidential Information and the property of the Company. Upon the expiration or termination of this Agreement, or upon the earlier request of the Company, Consultant shall deliver to the Company all property of the Company relating to, and all tangible embodiments of, Work Product in Consultant's possession or control. Lists and databases of investor, media and other contact information derived from the Consultant's own proprietary lists and databases shall not be considered Work Product under this Agreement, nor shall same be returned to the Company at the termination of this Agreement.
9.5 The Company hereby licenses the Consultant to use the Licensed Marks in connection with the provision of the Consulting Services. The Consultant acknowledges that neither it nor any of its affiliates have or shall obtain any interest (proprietary or otherwise) in the Licensed Marks and shall discontinue all use thereof (or of any similarly confusing trademarks, trade names or other intellectual property or rights) immediately upon the Company's written request or upon termination of this Agreement. The Consultant shall not contest the validity of the Licensed Marks and no monetary amount shall be attributable to any goodwill associated with the Company's use of the Licensed Marks.
10.0 General Contract Terms
10.1 Any notice required or permitted to be given hereunder shall be given by hand delivery, facsimile transmission or by registered mail, postage prepaid, addressed to the parties at their respective addresses as set forth in this Agreement and any such notices given by hand delivery or by facsimile transmission shall be deemed to have been received on the date of delivery or transmission and if given by prepaid registered mail, shall be deemed to have been received on the third (3rd) business day immediately following the date of mailing. The parties shall be entitled to give notice of changes of addresses from time to time in the manner hereinbefore provided for the giving of notice.
10.2 The provisions of this Agreement shall inure to the benefit of and be binding upon the Company and the Consultant and their respective successors and assigns. This Agreement shall not be assignable by either party without the prior written consent of the other party.
10.3 This Agreement constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the parties hereto in connection with the subject matter hereof. No supplement, modification, waiver or
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termination of this Agreement shall be binding, unless executed in writing by the parties to be bound thereby.
10.4 This Agreement shall be governed by the laws of the Province of British Columbia. If there is any controversy or claim arising out of or relating to this Agreement, which is not resolved within thirty (30) days, then either party may by written notice to the other submit the dispute for resolution in accordance with the rules of the British Columbia International Commercial Arbitration Centre. The appointing authority shall be the British Columbia International Commercial Arbitration Centre and the case shall be administered by the British Columbia International Commercial Arbitration Centre in accordance with its "Procedures for Cases under the BCICAC Rules" at Vancouver, British Columbia. The parties shall decide prior to the commencement of any such arbitration whether the award of the arbitrator shall be final and binding on the parties hereto. If the parties cannot agree on whether the arbitration shall be final and binding, then either party may proceed to have the matter dealt with by a court of competent jurisdiction.
10.5 All dollar amounts herein are made in lawful money of Canada and are exclusive of any applicable taxes the Consultant is obligated by law to charge and/or collect from the Company in connection with the rendering of its services.
10.6 Time shall be of the essence of this Agreement.
IN WITNESS WHEREOF this Agreement has been executed by the parties.
ENTRÉE GOLD INC.
/s/ ▇▇▇▇ Crowe______________________
Per:
Authorized Signing Officer
PRIMORIS GROUP INC.
/s/ ▇▇▇▇▇▇ Carusone___________________
Per: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Authorized Signing Officer
Schedule A
Consulting Services to be Provided
The following list contains an overview of the on-going services to be provided to the Company by the Consultant.
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CATEGORY |
DESCRIPTION |
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Investor and Media Relations |
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