Consulting Agreement - JBM Entertainment Inc. and 1485352 Ontario Ltd.
CONSULTING AGREEMENT
THIS AGREEMENT made as of the 1st day of June, 2002
BETWEEN
JBM ENTERTAINMENT INC., a corporation incorporated
under the 1aws of the Province of Nova Scotia
(hereinafter called "JBM")
and 1485352 ONTARIO LIMITED, a corporation incorporated under
the laws of the Province of Ontario
(hereinafter called the "Consultant')
WITNESSES:
WHEREAS:
A. Visual Bible International kc,, a corporation incorporated
under the laws of Florida, ( is engaged in the business of
producing, marketing and distributing feature length motion pictures
and ancillary products based on word-for-ford adaptations of the
Books of the Bible (the "Films");
B. Pursuant to a certain Management and Administration Agreement,
as amended, made as of the 1st day of June, 2002 (the "Management
Agreement"), JBM has been contracted to provide certain management
and administrative services to Visual;
C. Pursuant to the terms of the Management Agreement, JBM has been
authorized to retain the services of consultants to carry out and
perform the services to be provided by JBM to Visual;
D. Consultant has the requisite capability, experience and
capacity to assist and assume certain of the material requisite
responsibilities to be discharged by JBM under the Management
Agreement;
E. By these presents JBM wishes to retain the Consultant, on the
terms and conditions as herein contained, to provide consulting
services to JBM and the Consultant is agreeable to be so retained.
NOW, THEREFORE, in consideration of the mutual covenants,
conditions and premises herein contained, JBM and the Consultant
hereby covenant and agree with each other as follows:
PART 1 - ENGAGEMENT OF CONSULTANT
1.01 Engagement of Consultant: JBM hereby engages the Consultant to
provide consulting services (the "Services") to JBM so as to assist
JBM in discharge of its responsibilities under the Management
Agreement, it being acknowledged that coincident herewith JBM is
similarly engaging the services of another Canadian-controlled
corporation to provide consulting services to JBM (the "Other
Canadian Consultant").
1.02 Terms of Engagement: The parties agree that the term of the
within engagement of the Consultant by JBM shall coincide with the
term that the Management Agreement, as renewed and extended, is in
force and for greater certainty shall be for a continuous initial
term of the period of seven (7) years commencing on the date hereof
and thereafter shall be automatically renewed for successive
additional two (2) year periods. The period during which this
Agreement continues, including any and all renewal periods, is
referred to hereinafter as the "Term".
PART 2 - CONSULTING SERVICES
2.01 Consultant represents to and with JBM that throughout the Term,
Consultant shall be a Canadian-controlled corporation and it shall
have in its employ or otherwise engage resident Canadian persons
with the requisite capability and experience to provide the Services
as required hereunder to be rendered to JBM, none of which persons
presently are shareholders, directors, officers or employees of
Visual. Throughout the Term, Consultant shall so engage and have
the services of qualified individuals available to it to the full
extent required to enable it to fully discharge its responsibilities
to JBM.
2.02 The Services to be performed by the Consultant shall generally
be that of the managerial, administrative and supervisory
responsibilities of JBM as contained in the Management Agreement and
as so required to advance the business prospects of Visual. Such
Services, rendered when applicable in conjunction with the services
to be rendered by the Other Canadian Consultant similarly retained
by JBM shall, without limitations, include the following:
(a) responsibility for all aspects of the financing and the
distribution and marketing of the Films;
(b) monitoring and assisting the administration of the
financial affairs of Visual;
(C) recruitment of senior administrative and executive
officers of Visual, the engagement of whom shall be
subject to the board of directors of Visual;
(d) interfacing with other consultants who may be retained by
Visual in any capacity relating to the development,
production, marketing and distribution of any of the
Films; and
(e) generally to identify and implement business development
opportunities for Visual.
2.03 In the performance of the foregoing Services, it is hereby
specifically agreed and acknowledged that all of the approval rights
accorded to JBM under the Management Agreement with respect to the
business activities and obligations to be undertaken or be incurred
by Visual shall not be exercised by JBM but shall exclusively be
exercised by the Consultant together with the Other Canadian
Consultant both acting independently of JBM and not in any way under
the direction of JBM, it being acknowledged that in connection
therewith JBM, or its designee acting in the capacity of executive
produced of the Films, may only provide non-binding recommendations
to the Consultant and Other Canadian Consultant.
2.04 The Consultant's services are not by this Agreement to be
construed as being exclusively committed to JBM and the Consultant
shall be free, in its discretion, to conduct separate business
operations and further, to provide consulting services to any other
corporation, firm or person, provided always that the Consultant
must ensure that the services required by JBM as provided herein
shall at all times be performed in full.
2.05 The Services to be performed by the Consultant shall be
performed in its capacity as an independent contractor and nothing
herein shall be construed as creating a partnership, joint venture
or employment relationship between Consultant and JBM, nor between
Consultant and Visual.
2.06 The Consultant may, in order to perform its responsibilities
hereunder, retain such professional advisors, agents or other
assistants as the Consultant considers necessary or advisable and to
be reimbursed therefor by JBM as provided in section 3.02 of this
Agreement. The Consultant may rely upon any statement, notice,
report or opinion prepared by or any advice received from the
accountants, auditors, counsel or other professional advisors so
retained in connection with the performance of its duties hereunder
and the Consultant shall not be responsible or held liable for any
loss or damage resulting from so relying or acting if the Consultant
acted reasonably in relying upon the advice received.
2.07 The Consultant shall exercise its powers and carry out its
obligations hereunder honestly, equitably, in good faith and in the
best interests of JBM and Visual and in connection therewith will
exercise that degree of care, diligence and skill that a reasonably
prudent person would exercise in comparable circumstances.
2.08 The Consultant will not be subject to any liability whatsoever,
in tort, contract or otherwise, in connection with its obligations
hereunder to any person, for any authorized action taken or
permitted by it to be taken, or for its failure to take any action,
provided that the foregoing limitation will not apply in respect of
any action or failure to act arising from or in connection with
dishonesty, bad faith, willful misconduct, gross negligence or
reckless disregard of a duty by the Consultant.
PART 3 - FINANCIAL MATTERS
3.01 In consideration of the performance of the Services by the
Consultant, JBM, acknowledging that it is in receipt of other good
and valuable consideration from Visual, shall pay to the Consultant
during the initial twelve (12) months of the Term the equivalent of
50% of the sum to be received by JBM from Visual during this initial
period, such 50% sum being in the total amount of US$300,000 payable
in equal monthly installments in advance plus applicable GST.
During each subsequent twelve (12) month period within the Term,
conditional upon the commencement of principal photography of at
least one new Film during each Marketing Period, the said annual fee
of US$300,000 payable to Consultant shall be increased by US$50,000
and shall similarly be paid by JBM in equal monthly installments in
advance plus applicable GST. For purposes hereof, "Marketing
Period" shall mean each successive fifteen month period during the
Term commencing on the first day of the Term. Consistent with the
foregoing, Consultant shall be entitled to receive 50% of such
further fees or performance bonuses which JBM may receive under the
Management Agreement in connection with the rendition of the
equivalent of the Services.
3.02 JBM shall promptly reimburse Consultant for all expenses and
disbursements properly incurred by Consultant in the discharge of
its responsibilities hereunder to the extent that such reimbursement
is within the parameters permitted in the Management Agreement
governing the reimbursement by Visual of expenses incurred by JBM.
PART 4 - TERMINATION
4.01 This Agreement shall terminate upon the occurrence of any one
of the following events:
(a) the termination of the Management Agreement;
(b) The bankruptcy of Visual or the bankruptcy of either of
the parties hereto;
PART 5 - GENERAL
5.01 Further Assurances. The parties hereto shall from time to time
execute and deliver all such further documents and instruments and
do all acts and things as the other party may, either before or
after the execution hereof, reasonably require to effectively carry
out or better evidence or perfect the full intent and meaning of
this Agreement.
5.02 Governing Law. This Agreement shall be interpreted in
accordance with the laws of the Province of Ontario and the laws of
Canada applicable therein.
5.03 Amendments and Waiver. No modification of or amendment to this
Agreement shall be valid or binding unless set forth in writing and
duly executed by both of the parties hereto and no waiver of any
breach of any term or provision of this Agreement shall be effective
or binding unless made in writing and signed by the party purporting
to give the same and, unless otherwise provided, shall be limited to
the specific breach waived.
5.04 Assignment. This Agreement may not be assigned by either party
hereto without the prior written consent of the other party.
5.05 Notices. Any demand, notice or other
communication (hereinafter referred to as a "Communication") to be
given on connection with this Agreement shall be given in writing
and shall be given by personal delivery, or by transmittal by
facsimile or other form of recorded communication addressed to the
recipient as follows:
To Consultant: 177 MacPherson Avenue
Toronto, Ontario
M5R 1W9
Facsimile: (416) 927-0020
To JBM: Purdy's Wharf Tower One, Suite 900
1959 Upper Water Street
P.O. Box 997
Halifax, Nova Scotia
B3J 2X2
Facsimile: (902) 420-1417
Attn.: Charles S. Reagh
or to such other address, facsimile number or individual as may be
designated by notice given by either party to the other. Any
Communication given by personal delivery shall be conclusively
deemed to have been given on the date of actual delivery thereof
and, if given by facsimile transmission or other form of recorded
communication, shall be deemed given and received on the date of
such transmission if received during the normal business hours of
the recipient and on the first business day if it is received after
the end of such normal business hours on the date of its transmission.
5.06 Severability. If any provision of this Agreement shall be held
to be invalid or unenforceable, such invalidity or unenforceability
shall attach only to such provision and shall not in any manner
affect or render invalid or unenforceable any other provision of
this Agreement.
5.07 Enforcement. This Agreement shall enure to the benefit of and
be binding upon the parties hereto and their respective successors
and permitted assigns.
5.08 Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject
matter hereof and cancels and supersedes any prior understandings
and agreements between the parties hereto with respect thereto.
There are no representations, warranties, terms, conditions,
undertakings or collateral agreements, express, implied or
statutory, between the parties other than as expressly set forth in
this Agreement.
IN WITNESS WHEREOF the parties hereto have executed this
Agreement as of the date first above written.
1485352 ONTARIO LIMITED
Per: /s/ Myron Gottlieb
Authorized Signing Officer
JBM ENTERTAINMENT INC.
Per: /s/ Joel B. Michaels
Authorized Signing Officer