CONSULTING AGREEMENT
THIS AGREEMENT is made and entered into as of this 2nd day of March,
1999, by and between CANADIAN IMPERIAL BANK OF COMMERCE, a Charter bank under
the laws of Canada ("CIBC") and FINANCIAL SUPERMARKETS, INC., a Georgia
corporation ("FSI").
WHEREAS, CIBC has decided to establish retail banking services delivery
centers in supermarkets and other locations ("Banking Centers") in the United
States (the "Geographic Area");
WHEREAS, CIBC wishes to engage FSI as its exclusive consultant with
respect to the establishment, design, construction, operation and marketing of
Banking Centers (the "Program") in the Geographic Area;
WHEREAS, CIBC is in the process of chartering a bank to provide banking
services in respect of the Program initially in the State of Florida (the
"Bank"); and
WHEREAS, FSI is willing upon the terms and conditions hereinafter set
forth to enter into a consulting relationship with CIBC.
NOW, THEREFORE, in consideration of the premises set forth below, and
other good and valuable consideration, including ten dollars (U.S. $10.00) in
hand paid by CIBC to FSI, the receipt and sufficiency of all such consideration
being hereby acknowledged, FSI and CIBC agree as follows:
(1) CIBC hereby retains FSI to be its exclusive provider of consulting
services to CIBC's officers and employees, subsidiaries and affiliates
(including but not limited to the Bank) with respect to the establishment of the
Program by the Bank in any location in the Geographic Area and any other
affiliate or successor of CIBC which establishes Banking Centers in retail or
supermarket locations in the Geographic Area (the Bank and such other banks
being hereinafter referred to as "Program Banks") and FSI agrees to render such
services. In addition, CIBC grants FSI a first right of refusal to provide
consulting services with respect to the Program in all areas outside the
Geographic Area and Canada for the term of this Agreement. FSI acknowledges that
the terms of this Agreement do not apply to CIBC's Financial Services Agreement
made as of November 1, 1997 with Loblaws Companies Limited in respect of the
Presidents Choice Financial Services offer.
(2) The general scope of FSI's duties hereunder (the "Services") shall
be to advise and consult with the officers and employees of CIBC and the Bank in
connection with establishing relationships with retail partners and, the
establishment, operation and marketing of the Banking Centers. CIBC agrees to
provide FSI at CIBC's cost such marketing materials regarding CIBC and its
banking services as FSI may reasonably request. FSI will also provide consulting
services with respect to bank regulatory issues if requested to do so by CIBC or
the Bank at no extra cost to CIBC or the Bank.
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(3) During the term of this Agreement FSI shall perform the consulting
services described herein and all reasonable tasks incidental thereto as the
officers and employees of CIBC or the Bank may from time to time reasonably
request including without limitation the preparation of a marketing and training
program for the Banking Centers. In performing any of its duties hereunder,
including without limitation its provision of a marketing and training program
for the Banking Centers, FSI shall not be liable to CIBC or to any other party
for any damages, loss or expenses, except for damages, losses or expenses caused
by the willful default or negligence of FSI. Nothing in this Agreement shall be
deemed to create any agency, joint venture or employment relationship between
FSI and CIBC, and it is expressly understood and agreed that FSI is and will
remain an independent contractor for the purpose of providing consulting
services and advice to CIBC as herein provided.
(4) It is contemplated that FSI may also consult with and render advice
to supermarkets and other retail locations ("Retail Owners") in connection with
the establishment, operation and marketing of retail banking and other
depository facilities in retail locations where the Banking Centers will be
located, and that FSI will receive compensation from Retail Owners for such
services. CIBC hereby consents to FSI's provision of such advisory and
consulting services to and its receipt of compensation therefor from Retail
Owners. It is also contemplated that FSI may consult with and render advice to
other depository institutions in the Geographic Area which have facilities
located within retail locations, and that FSI will receive compensation from
such other depository institutions for such services. CIBC also hereby consents
to FSI's provision of such advisory and consulting services to such other
depository institutions and its receipt of compensation therefor from such other
institutions. Notwithstanding the foregoing except as set forth below, FSI shall
not offer to consult with or render advice to any Canadian, or Canadian owned
financial depository institution (a "CDI"). If any CDI requests that FSI consult
with or offer advice to it with respect to the establishment and marketing of
banking services in conjunction with a retail establishment in the Geographic
Area (the "Opportunity"), FSI will first offer such Opportunity to CIBC or the
Bank in writing. If, within 30 days of receipt of such written offer, CIBC or
the Bank (i) advises FSI it does not wish to pursue such Opportunity, (ii) does
not respond to the written offer in writing to FSI or (iii) does not enter into
a binding agreement with respect to such Opportunity within sixty days, FSI may
enter into a consulting relationship with such CDI.
(5) FSI will also act as CIBC's exclusive agent and consultant for the
design, construction and project management and for the procurement of all of
the personal property required by the Program Banks to establish and operate the
Banking Centers, and CIBC hereby acknowledges and agrees that the consideration
paid by CIBC to FSI for its services in the procurement of any such items shall
be in addition to and separate from FSI's compensation under this Agreement for
the on going consulting and advisory services rendered by it to CIBC.
(6) In compensation for the consulting services rendered hereunder,
CIBC shall pay FSI a monthly retainer for the term of this Agreement (the
"Monthly Retainer") of U.S. ______ beginning upon execution of this Agreement
for the first retail partner (which includes Winn-Dixie Stores, Inc.) which
amount shall increase by U.S. _________ for each additional retail partner, plus
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out-of-pocket, travel and other expenses incurred by FSI provided that no
reimbursement for out-of-pocket expenses shall be payable with respect to
banking centers located in Retail Owners with whom FSI has an exclusive
relationship. In addition, CIBC will pay FSI a monthly fee of U.S. ______ times
the number of Banking Centers opened by CIBC during the term of this Agreement
(the "Monthly Per Location Fee"). The Monthly Per Location Fee shall commence
with respect to each Banking Center on the date the Banking Center opens for
business and shall continue to be due on the first day of each succeeding month
for so long as the lease agreements or other compensation arrangements for those
Banking Centers remain in effect. CIBC will also pay FSI upon the opening of a
Banking Center with respect to Banking Centers opened in each Retail Owner's
retail location (the "Initial Per Location Fee") (which amounts will be
calculated separately for each Retail Owner) U.S. ______ per Banking Center for
Banking Centers _______, U.S. ________ per Banking Center for Banking Centers
_______, and U.S. _______ per Banking Center for each Banking Center opened
after the _______ Banking Center. As compensation for the procurement of the
personal property and the design, construction and project management required
for the establishment of each Banking Center referenced in paragraph 5, CIBC or
the Bank shall pay FSI _________________ as described in Exhibit A plus _______
per Banking Center (which includes project management and the marketing and
training described in Exhibit B). FSI agrees that it shall not charge CIBC or
the Bank more than its own costs incurred in procuring such services plus the
amounts set out in Schedule "A" and that CIBC or the Bank may, upon reasonable
notice, review invoices from FSI's suppliers to verify such amounts. If FSI and
CIBC mutually agree that CIBC may provide any of the services listed in items 1
through 10 on Exhibit A, then CIBC will pay FSI the amount of the
________________________________ ____________FSI would have earned had it
supplied such services at CIBC's cost. CIBC agrees to provide FSI copies of
invoices for such services for FSI's review. In addition, Program Banks will pay
FSI within 45 days of the end of each calendar quarter an amount equal to
_______ times the _________________________ in the Geographic Area during the
preceding quarter for the term of this Agreement based on
___________________________________________________ ______________________
calculated based upon information contained in or used to prepare the
Consolidated Reports of Condition and Income (the "Call Report") filed by such
entities with bank regulatory authorities. If Program Banks offer proprietary
cash and cash equivalent products (such as money market mutual funds) which are
not reflected in the Call Report, then the parties agree in good faith to
negotiate compensation to FSI with respect to such products.
(7) Unless earlier terminated as provided herein, this Agreement shall
continue as long as the Program Banks have Banking Centers in retail locations
in the Geographic Area. This Agreement may be terminated upon written notice (a)
by a party if the other party shall become insolvent, or generally unable to pay
its debts as they become due, or shall become the subject of a bankruptcy,
conservatorship, receivership or similar proceeding, or shall make a general
assignment for the benefit of creditors, (b) by either party if such party is
prevented by bank regulatory authorities from engaging in the activities
contemplated by this Agreement, or (c) by either party if CIBC does not receive
approval of its board of directors to commence the Program in the Geographic
Area (once such CIBC board approval is received this provision (c) shall be of
no further force and effect); provided, however, that the termination or
expiration of this Agreement shall not terminate the obligation of CIBC to pay
the Monthly Per Location Fees referenced in Paragraph 6 for so long as the lease
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agreements or other compensation arrangements for those Banking Centers with the
Retail Owner remain in effect.
(8) This Agreement and the rights and responsibilities of the parties
hereunder, including without limitation CIBC's rights under Section 1 hereof,
may not be assigned or delegated by either party without the express written
consent of the other. Notwithstanding the foregoing, this Agreement will inure
to the benefit of and be binding upon the successors by merger or amalgamation
of any party to this Agreement.
(9) All fees due to FSI hereunder will be adjusted annually after the
tenth anniversary of this Agreement by multiplying such fee by the increase
(expressed as a percentage), if any, in the most recently published CPI value as
of August 1st of such year, from the CPI value published for August 1 of the
prior year. As used herein, "CPI" shall mean the Consumer Price Index for all
Consumers, U.S., City Average (1982-84 = 100) All Items Index, published by the
Bureau of Labor Statistics, United States Department of Labor. If the CPI shall
cease to be compiled and published at any time during the term of this
Agreement, but a comparable successor index is compiled and published by the
Bureau of Labor Statistics, United States Department of Labor, the adjustments
to annual fees provided for herein shall be computed according to such successor
index, with appropriate adjustments in the index to reflect any differences in
the method of computation from the CPI. If, at any time during the term of this
Agreement, neither the CPI nor a comparable successor index is compiled and
published by the Bureau of Labor Statistics, the index for "all items" compiled
and published by any other branch or department of the federal government shall
be used as a basis for calculation of the adjustments to the fees provided for
above, and if no such index is compiled and published by any branch or
department of the federal government, the statistics reflecting cost of living
increases as compiled by any institution or organization or individual generally
recognized as an authority by financial and insurance institutions shall be
used.
(10) Each party agrees to indemnify and hold harmless each of the other
and their respective agents, employees and affiliates against any expense, loss,
liability or damage, whether legal or otherwise, that results from the
negligence, bad faith or wilful misconduct of such other party, or the breach by
such other party of any provision of this Agreement. In this Agreement, the term
"liability" shall include any losses, claims, damages, expenses (including,
without limitation, reasonable costs and expenses in defending against any
losses, claims or investigations of any nature whatsoever) or other liabilities
arising for any reasons under this Agreement. This paragraph shall survive
termination of this Agreement.
(11) The parties agree that they will not, except with the prior
written approval of the other party, disclose Confidential Information to any
person or firm other than the other party, or use Confidential Information for
financial gain during the term of this Agreement and within 3 years of the
expiration or termination of this Agreement for whatever cause, except that
these restrictions shall not apply to information that shall (a) become
generally known through no fault of either party, (b) information that is
disclosed to either party by a third party that has legitimate and unrestricted
possession thereof and the unrestricted right to make such disclosure, (c)
information that either party can demonstrate was within its legitimate and
unrestricted possession prior to the time of this Agreement, or (d) other
information not rising to the level of a trade secret after 2 years from
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expiration or termination of this Agreement. "Confidential Information" means
all business records, trade secrets, know-how concerning marketing, customer
lists or compilations, financial information, personnel data, information
contained in any documents prepared by or for either party and their respective
employees at either party's expense or on either party's time or otherwise in
furtherance of either party's business, and made available only to either party
and such of its authorized agents as may be necessary to further either party's
business, and other confidential information used and/or obtained by either
party hereunder, are and shall remain the confidential and exclusive property of
such party. The parties further agree to return to the other party all of the
above business records and any and all copies of the same in its control upon
termination or expiration of this Agreement.
(12) Each provision contained in this Agreement shall be independent
and severable from all other provisions contained herein and the validity of any
such provisions shall in no way affect the enforceability of the other
provisions of this Agreement. All provisions of this Agreement related to
ongoing payment obligations and confidentiality shall survive termination of
this Agreement.
(13) The parties hereto agree that this Agreement sets forth all
promises, agreements and matters between them with respect to the matters
contained herein.
(14) This Agreement shall be governed and enforced in accordance with
the laws of the State of New York.
(15) All notices or other communications required or permitted to be
given or made hereunder shall be in writing and delivered personally or sent by
pre-paid, first class certified or registered mail, return receipt requested, or
by facsimile transmission, to the intended recipient thereof at its address or
facsimile number set out below. Any such notice or communication shall be deemed
to have been duly given immediately (if given or made in person or by facsimile
confirmed by mailing a copy thereof to the recipient in accordance with this
Paragraph 15 on the date of such facsimile), or five days after mailing (if
given or made by mail), and in proving the same it shall be sufficient to show
that the envelope containing the same was delivered to the delivery service and
duly addressed, or that receipt of a facsimile was confirmed by the recipient as
provided above. Either party may change the address to which notices or other
communications to such party shall be delivered or mailed by giving notice
thereof to the other party hereto in the manner provided herein.
(a) To CIBC: Canadian Imperial Bank of Commerce
20 Dundas Street West, 6th Floor
Toronto, ON M5G2C2
Attention: Mr. David Cyr, Senior Vice
President, Electronic Banking
Personal & Commercial Bank
Facsimile: (416) 861-3971
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With copies to: Canadian Imperial Bank of Commerce
20 Dundas Street West, 6th Floor
Toronto, ON M5G2C2
Attention: Nora Brooks
(b) To FSI: Financial Supermarkets, Inc.
400 N. Main Street
P.O. Box 1900
Cornelia, GA 30531
Attention: J. Alton Wingate, President
and Chief Executive Officer
Facsimile: (706) 776-7269
With copies to: Kilpatrick Stockton LLP
Suite 2800
1100 Peachtree Street
Atlanta, Georgia 303039-4530
Attention: F. Sheffield Hale
Facsimile: (404) 815-6555
(16) This Agreement may be executed simultaneously in any number of
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same instrument.
(17) (a) Any and all disputes arising out of or in connection with the
negotiation, execution, interpretation, performance or nonperformance of this
Agreement shall be solely and finally settled by arbitration, which shall be
conducted in Atlanta, Georgia, or at such other location as the parties may
agree in writing. The arbitrator shall conduct the proceedings in accordance
with the Commercial Arbitration Rules of the American Arbitration Association
(the "Rules"). The arbitration proceeding shall be initiated in accordance with
the Rules. The parties hereby renounce all recourse to litigation and agree that
any arbitration award shall be final and subject to no judicial review. The
arbitration shall be conducted before one arbitrator, chosen in accordance with
the Rules. The arbitrator shall decide the issues submitted in accordance with
(i) the language and commercial purposes of this Agreement; and (ii) what is
just and equitable under the circumstances, provided that all substantive
questions of law (excluding principles of conflicts of laws) shall be determined
under the laws of the State of New York.
(b) The parties agree to facilitate the arbitration by: (i)
making available to one another and to the arbitrator for examination,
inspection and extraction all documents, books, records and personnel under
their control determined by the arbitrator to be relevant to the dispute (ii)
conducting arbitration hearings to the greatest extent possible on successive
days; and (iii) observing strictly the time periods established by the Rules, or
by the arbitrator, for submission of evidence or briefs.
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(c) Judgment on the award of the arbitrator may be entered in
any court having jurisdiction over the party against which enforcement of the
award is being sought. All deposits and other costs (other than fees of counsel)
incurred in conducting the arbitration shall be borne equally by the parties.
Each party shall be solely responsible for its own attorney's fees incurred in
connection with the arbitration.
(d) This section shall survive completion or termination of
this Agreement, and shall be specifically enforceable in any court of competent
jurisdiction. In no event shall a demand for arbitration be made after the date
when any applicable statute of limitations, or period for claims under the
Agreement, would bar institution of a legal or equitable proceeding based on
such dispute or subject matter in question.
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute this Agreement and affix their respective seals
hereto, all as of the date first set forth above.
CANADIAN IMPERIAL BANK
OF COMMERCE
BY: /s/ David Cyr
--------------------------
TITLE: Senior Vice President
---------------------
BY: /s/ Brian Cassidy
----------------------------
TITLE: Executive Vice President
------------------------
(CORPORATE SEAL) FINANCIAL SUPERMARKETS, INC.
ATTEST: Annette R. Fricks BY: /s/ J. Alton Wingate
----------------- ---------------------------
TITLE: Corporate Secretary Title: President and CEO
------------------------- ------------------------
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EXHIBIT A
COSTS OF SERVICES
1. Site preparation (ceiling, floor, windows) as necessary
2. Design concept of bank model to meet CIBC, the Banks, and Winn-Dixie's
approval
3. Preparation of construction design documents
4. Construction and installation of bank unit
5. HVAC and sprinkler relocation and lighting installation
6. Permitting costs (including impact fees) and coordination of permitting
process
7. Interior and exterior signage and graphics (as specified)
8. Furniture
9. Equipment (Includes ATM(s), PC's, PIN selector, safe(s), under counter,
security and alarm equipment)
10. Any other direct cost incurred by FSI in connection with the
establishment of the Banking Center
11. Administrative overhead of _______ will be added to above total
12. Profit margin of _______ to be applied to the sum of 1 through 11
13. CIBC will be responsible for payment of applicable sales tax
The Banking Centers will be installed pursuant to a Master Purchase Agreement
which will provide for payment of the amounts set out in paragraph 6 as follows:
(1) _______ for marketing, training and project management and _______ for
deposits required for items 1 through 10 payable upon execution of a purchase
order for the Banking Center; (2) the Initial Per Location Fee upon opening of
the Banking Center; and (3) the remaining amount due with respect to the Banking
Center upon delivery by FSI of invoices detailing the final cost of the Banking
Center (including FSI's administrative and profit percentages).
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EXHIBIT B
MARKETING AND TRAINING SERVICES FOR CIBC
FSI will conduct a comprehensive training package to assist CIBC in
establishing and running a successful banking center program. The package will
include an Executive Planning Session with supervisors of the program. This
session will primarily address issues in human resources, sales training, and
marketing strategies. The Executive Planning Session will be conducted with CIBC
management in either Canada or Florida.
FSI will also conduct Sales Training Sessions for the staff hired to
run the CIBC banking centers and call center agents. The Bank will provide
content and materials for the banking system training, to be delivered by FSI in
the same session. These sessions are geared toward assisting banking center
personnel in understanding the unique challenges and opportunities of an
in-store location and methods to capitalize on those opportunities. These
sessions will be completed on site in Orlando. For efficiency, CIBC and FSI may
choose to schedule regular In-Store Sales Training sessions every two weeks. As
employees are hired, they will be scheduled for sales training. Outlines of the
Executive Planning Session and In-Store Sales Training are attached.
After the initial training sessions, FSI will conduct follow up
sessions on request and quarterly program reviews.
CIBC banking centers will also receive FSI's bi-weekly in-store sales
motivation letter and be given on-going consulting support via FSI's toll free
support line or Email. CIBC will also receive one complimentary registration per
banking center to the FSI Annual Membership Meeting.
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INITIAL EXECUTIVE PLANNING SESSION FOR CIBC
Supermarket Banking: The Future is Now
Partners: Banker and Grocer
Getting Off on the Right Foot
HUMAN RESOURCES
Key Positions and Characteristics of a Banking Center
The Banking Center Staff WHERE DO YOU FIND THEM?
Key Characteristics for a Banking Center Employee
The Banking Center Staff LOOKING OUTSIDE THE BANK
Job Description (Banking Center Sales Manager)
Job Description (Banking Center Assistant Sales Manager)
Job Description (Banking Center Customer Service Representative)
Staffing: Finding the Proper Size
Sample Interview Questions
Employee Compensation and Incentive Pay
Sample Incentive Programs
TRAINING
Training the Banking Center Staff
Banking Center Training Schedule
In-Store Sales Training: Key Subjects
GRAND OPENING
Coming Soon! GETTING OFF TO A HEAD START
News Release
The Grocery Store's Grand Opening: Maximizing Impact
Your "Soft" Opening: PURPOSE, FOCUS, AND GOALS
A Soft-Opening Promotion
Your Grand Opening: PURPOSE, FOCUS, AND GOALS
The Grand Opening: Preparations
A Grand Opening Promotion THE TREASURE CHEST PROMOTION
Pre, Soft, & Grand Opening Checklist
Grand Opening Supplies
MARKETING
Rethinking Marketing
Defining the Target Market of The Banking Center
Learning the Market SUPERMARKET CUSTOMER PATTERNS
In-Store Personal Selling
The Coffee Table as a Selling Center
Balloons: MORE THAN JUST HOT AIR
Public Address System Announcements
PA Announcement Samples
In-Store Signs
Building a Customer Data Base
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CIBC/FSI IN-STORE SALES TRAINING PROTOTYPE
KEY SUBJECTS
Supermarket Banking: The Future is Now
Partners: Banker and Grocer
It's No Place Like Home
With Challenges Come Opportunities
Forming A Team
Understanding "Selling"
First Things First
Defining the Target Market
Learning the Market
Rethinking Marketing
The Marketing "Arsenal"
In-Store Personal Selling
Public Address System Announcements
Creating and Making Effective PA Announcements
In-Store Signs
The Coffee Table as a Selling Center
Promotions and Giveaways
Promotional Ideas
The Grocery Cart Challenge
Building a Customer Data Base
You Can't Control What You Don't Measure
Time Management
It's Time to Start
