Management Agreement - Dir-Ad Services Inc./Les Services Dir-Ad Inc. and TMP Worldwide Ltd.
-------------------------------------------------------------------------------- MANAGEMENT AGREEMENT -------------------------------------------------------------------------------- THIS AGREEMENT dated for reference June 1, 1997, is made BETWEEN DIR-AD SERVICES INC./LES SERVICES DIR-AD INC., (formerly 3271986 Canada Inc.) a company duly incorporated under the laws of Canada, and having an office at Suite 200 - 16 Westminister N., Montreal, Quebec, H4X 1Z1 (the "Company"); AND TMP WORLDWIDE LTD., a company with an office at 184 Front Street East, Suite 201, Toronto, Ontario, M5A 4N3 (the "Manager"). BACKGROUND A. The Company is in the business of providing yellow page advertising agency services (the "Business") to its clients; B. The Manager is also engaged in the Business for its own account and is experienced in managing all aspects of the Business. C. The Company wishes to have the Manager and the Manager has agreed to administer and manage the Business of the Company on the terms and conditions set out in this Agreement. NOW THEREFORE in consideration of the premises and mutual agreements and covenants herein contained, the parties hereto (the "parties") hereby covenant and agree as follows: 1. DUTIES The Company agrees to retain and employ the Manager to provide the following services in respect of the Business of the Company: <PAGE> -2- (a) conceptualization and production of yellow page advertisements; (b) research, recommendation and yellow page placement; (c) monitoring and verification of yellow page placement; (d) consulting and implementation of human resources communication plan; (e) administration of payroll and employee benefits; (f) administration and collection of accounts receivable; (g) administration of accounts payable; (h) management of cash flow and relations with bankers; (i) maintenance of a general ledger and all necessary accounting books and records; (j) preparation of monthly financial statements and analytical reports; (k) preparation of financial statements and year end file for external auditors; (l) preparation and administration of all statutory reports, returns and filings; (m) the advice of and access to managerial expertise of senior management of the Manager or their delegate or representatives; (n) administration and management of other projects as requested from time to time by the Company; and (o) all customer service functions including proposals, tenders, communications, inquiries, billings and collections. <PAGE> -3- 2. REMUNERATION The Company will pay to the Manager on a month to month basis a management fee equal to a percentage (as agreed from time to time) of total billings on all sales made by the Company (the "Management Fee"). 3. TERM 3.1 Renewal This Agreement will automatically renew each month provided that this Agreement is not terminated by either party in the manner set out in Subsections 3.2 and 3.3 of this Agreement. 3.2 Termination With Notice This Agreement may be terminated by either party by giving 30 days notice in writing of termination to the other party. 3.3 Termination Without Notice Notwithstanding Subsection 3.2 of this Agreement, the Company may terminate this Agreement without notice for cause effective immediately. 4. CONFIDENTIAL INFORMATION Each of the parties acknowledges that, during the term of this Agreement, they will gain access to certain information concerning the Business and the Business of the Company of a special and unique value. Each of the parties further acknowledges that such information is proprietary and includes trade secrets. Except as required by law and only to the extent that a third party has a legitimate need to know, each of the parties agrees to keep in strictest confidence all Confidential Information relating to the Business of the Company which either of them acquires in connection with or as a result of performance of this Agreement, and not to publish, communicate, divulge or disclose to any third party or parties any Confidential Information, without the prior written consent of the other, during the term of this Agreement or at any time subsequent to it. The term "Confidential Information" includes, but is not limited to, information emanating from the Company or the Manager or their respective associates, affiliates, agents, suppliers or customers <PAGE> -4- or conceived or developed by the Company or the Manager concerning research, development, intellectual property rights, products, marketing plans and strategies, records, documents and oral communication pertaining to operations, finance, accounting, sales, personnel, management, customer names, customer addresses, price list, customer requirements, cost of providing service or equipment, operating costs, maintenance costs, material cost and pricing matters, systems and procedures relating to the Business of the Company. 5. RETURN OF PROPERTY AND CONFIDENTIAL DATA On termination of this Agreement for any reason or cause, the Manager will deliver to the Company the property and data of the Company in the Manager's possession or control which contain Confidential Information as defined in Section 4 of this Agreement including, but not limited to, all documents, notebooks, charts, files, computers, diskettes, records, memoranda, equipment, audio and videotapes. 6. INDEMNIFICATION OF MANAGER The Company will and hereby agrees to indemnify and save harmless the Manager from and against all claims and demands of any nature or kind whatsoever brought against the Manager as a result of the performance in good faith of the duties and obligations of the Manager pursuant to this Agreement. 7. MISCELLANEOUS 7.1 Enurement This Agreement enures to the benefit of and is binding on the Parties and, except as otherwise provided in this Agreement or as would be inconsistent with the provisions of this Agreement, their respective successors and permitted assigns. 7.2 Headings The headings in this Agreement are for convenience only and will not effect the interpretation of this Agreement. <PAGE> -5- 7.3 Further Assurances The Parties covenant and agree to execute and deliver any other deeds, documents and assurances and to do any other acts required to carry out the true intent and meaning of this Agreement. 7.5 Language The Parties agree that this Agreement and all other documentation between the Parties be in the English language. Les parties aux presentes ont exige que la presente convention et toute autre documentation soit redigee en langue anglaise. A singular or masculine expression used in this Agreement includes the plural, the feminine or the body corporate as the context requires. 7.6 Severability If any provision of this Agreement is found to be illegal or unenforceable for any reason, it will be considered separate and severable from this Agreement and the remaining provisions of this Agreement will remain in force and be binding upon the Parties as though the Agreement has been executed without the illegal or unenforceable portion and it is hereby declared the intention of the Parties that this Agreement would have been executed without reference to any portion that may, for any reason, be hereafter declared or held invalid. 7.7 Entire Agreement This Agreement constitutes the entire agreement between the Parties and this Agreement supersedes any and all prior oral or written agreements between the Parties. 7.8 Amendment This Agreement may not be amended or modified except as provided in this Agreement or by subsequent agreement in writing signed by the Parties. <PAGE> -6- 7.9 Counterparts This Agreement may be executed in two counterparts, each of which will be deemed to be an original, but all of which together will constitute one and the same instrument, notwithstanding that all the parties are not signatories to the same counterpart. 7.10 Notice Any notice, document or communication required or permitted to be given hereunder will be in writing and will be deemed to have been duly given if delivered by hand, mailed by pre-paid registered mail or telex or by facsimile to the party concerned addressed as follows: If to the Company: Dir-Ad Services Inc./Les Services Dir-Ad Inc. Suite 200 - 16 Westminister N.. Montreal, Quebec H4X 1Z1 Tel: (514) 482-3900 Fax: (514):482-3833 If to the Manager: TMP Worldwide Ltd. 184 Front Street East, Suite 201 Toronto, Ontario M5A 4N3 Tel: (416) 864-1990 Fax: (416) 864-1897 or to any other address as may be from time to time be notified in writing by any of the Parties. Any notice, document or communication will be deemed to have been give, if delivered by hand, on the day delivered, and if mailed, four business days, excluding Saturdays, Sundays and statutory holidays in the country to which notice, document or communication is addressed, following the date of posting; provided that if there is at the time of mailing or within four business days thereof a mail strike, slowdown or other labour dispute that might affect delivery by the mails, then the notice, document or communication will be effective only when actually received. <PAGE> -7- IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day, month and year first above written. TMP WORLDWIDE LTD. Per: _____________________________________________ Authorized Signatory Dir-Ad Services Inc./Les Services Dir-Ad Inc. Per: _____________________________________________ Authorized Signatory