Exhibit 10.4
Project No: BDP 503 0890
April 27,1998
Island Critical Care Corporation
100-10 Camelot Drive Nepean, Ontario K2G5X8
Attention: Ken Legere
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Dear Mr. Legere:
Re: ACOA Business Development Program (BDP)
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In response to your application dated April 14, 1998, the Atlantic Canada
Opportunities Agency ("the Agency"), hereby offers to make a Repayable
Contribution to Island. Critical Care Corporation ("the Applicant") upon the
following Terms and Conditions:
1.00 Contribution
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1.01 Subject to all other provisions of this Agreement, the Agency will
make a Repayable Contribution ("the Contribution") to the Applicant to assist in
the execution by the Applicant of the Project as described and defined in Annex
1 (Statement of Work) calculated as the lesser of (a) and (b) as follows: (a)
50% of eligible capital costs estimated to be $720,000; or (b) $360,000.
2.00 Disbursements
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2.01 Progress Payments
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At the request of the Applicant, the Agency may make progress payments to
the Applicant based on claims for eligible costs which have been incurred. Each
claim shall be completed in accordance with instructions to be provided by the
Agency to the Applicant.
Joint Payments
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At the discretion of the Agency or at the request of the Applicant, the
Agency may make a payment/s jointly to the Applicant and the supplier for
eligible costs which have been incurred.
Final Payments
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Notwithstanding the foregoing, 10% of the Contribution will normally be
reserved for a final payment to be based on a claim submitted by the Applicant
at the time of Project Completion and normally after all eligible costs have
been incurred and paid.
2.02 It is a requirement of this agreement that the Applicant shall keep
the original invoices and proof of payment for all claimed costs readily
available for examination by the Agency during any payment verification or audit
and until 36 months following the end of the Control Period.
3.00 Repayment Terms
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3.01 The Applicant shall repay the Contribution to the Agency in sixty
equal installments of $6,000; however, the last installment will be adjusted to
include all sums owing.
3.02 The first repayment installment is due and payable on January 1, 2000.
3.03 Prior to any disbursement of this Contribution by the Agency, the
Applicant shall arrange pre-authorized payments for scheduled repayments for the
period until full repayment of the Contribution is completed. (Annex 4 is
attached).
3.04 The Applicant shall pay, where the account is overdue and in addition
to any amount payable, interest on that amount. The interest, calculated and
compounded monthly, shall accrue from the due date until payment is received.
The rate of interest shall be equal to three percent (3%) higher than the
average Bank of Canada discount rate for the previous month.
3.05 A $15 administration fee will be charged on every payment for which
insufficient funds were available in the account identified for payment.
3.06 The Applicant may, at any time, make prepayments on account of
repayment installments and each such prepayment will be applied first to
interest owing and secondly to repayment installments in reverse order of
maturity.
4.00 Special Conditions
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4.01 The Agency shall not contribute to any cost incurred by the Applicant
prior to April 16, 1998.
4.02 As a condition of the Agency's assistance,
(a) The Applicant shall ensure the Project commences on or before June
1,1998.
(b) The Applicant shall ensure the Project is completed as described in
the Statement of Work on or before March 31, 1999.
4.03 The Applicant shall inform the Agency promptly in writing of any,
assistance from other federal, provincial or municipal sources which had been
received or is to be received for the Project and the Agency shall have the
right to adjust the amount of the assistance to take into account the amount of
any such further assistance received.
4.04 The Applicant shall comply with environmental protection measures in
relation to the Project that satisfy the requirements of all regulatory bodies
of appropriate jurisdiction.
4.05 The Applicant shall attain equity, satisfactory to the Agency, in the
total amount of $800,000 on or before the date of the first disbursement by the
Agency to the Applicant.
4.06 Unless otherwise authorized by the Agency in writing, this level of
equity shall be maintained until the end of the control period.
4.07 Prior to the end of the control period, the Applicant shall not pay
any dividends whatsoever, make payments to a parent company or any of its
affiliates, nor payout shareholders loans without the approval of the Agency.
4.08 The Applicant, on or before the date of first disbursement, shall
obtain working capital financing in the amount of $1,500,000, and Human Resource
Development Corporation (HRDC) funding in the amount of $300,000.
4.09 The Applicant, on or before the date of first disbursement shall
provide proof that;
(i) Island Critical Care Corporation is licensed to carry on business in
Prince Edward Island;
(ii) That the licensing agreement between Masimo and Schiller Canada has
been transferred to Island Critical Care Corporation, and
(iii) National Research Council (NRC) has reviewed the product engineering
plans.
5.00 Reporting
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5.01 From the date of Project Commencement until the Project Completion
date, the Applicant shall submit, at the request of the Agency, status reports
on the progress and results of the Project in a form satisfactory to the Agency.
5.02 The Applicant shall submit to the Agency, within 90 days of the end of
each fiscal year which commences before the end of the Control Period, as
defined in the attached general conditions, a copy of its financial statements.
6.00 Notice
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6.01 Any notice or correspondence to the Agency, including the attached
duplicate copy of this Agreement signed by the Applicant, shall be addressed to;
Atlantic Canada Opportunities Agency
P.O. Box 40
Charlottetown PE C 1 A 7K2
Attention: Pat MacAulay
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or to such address as is designated by the Agency in writing.
7.00 Entire Contract
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7.01 This offer, if accepted, including all Annexes will constitute the
entire agreement between the parties with respect to its subject matter. No
amendments shall be made to the resulting contract unless confirmed in writing.
This offer is open for acceptance for 60 days from the date that appears on
its face. The date of acceptance shall be the date the duplicate copy of this
offer, unconditionally accepted and duly executed by the Applicant is received
by the Agency.
If further information is required, please contact the undersigned at (902)
368-0670 or 1-800-871-2596.
Yours truly,
/s/ Dan Fenety
Dan Fenety
Vice President
Attachments:
- Annex 1 - The Project - Statement of Work
- Annex 2 - Project Fact Sheet for News Release
- Annex 3 - General Conditions
- Annex 4 - Pre-Authorization Payment Form
The foregoing offer is hereby accepted this 25 day of May, 1998.
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Island Critical Care Corporation
(Project No: BD 5030890)
/s/ Kenneth R. Legere
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(Signature)
President
(Title)
(Corporate Seal)
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(Signature)
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(Title)
November 2, 1999
Business Development Project #BDP 5030890
Mr. Ken Legere
Island Critical Care Corporation
29 Hollahan
Nepean, ON
K2J3W9
Dear Mr. Legere:
We believe that providing information to the public about government and
private sector activity is an important element in influencing economic
development in Atlantic Canada. Highlighting news about local business
development projects helps increase awareness about how business and community
activity contributes to job creation and economic growth.
I wish to draw your attention to the communications clauses in your recent
letter of offer for government assistance. They allow for general and funding
information about your project(s) to become accessible to the public and media.
Your letter of offer indicates that ACOA has the first right to publicly
announce funding to your project(s) through a news release or other promotional
activity such as a sod-turning or official opening.
The attached "fact sheet" contains information extracted from your
project(s) files and is used as the basis for preparing an announcement. The
information may be used in other public materials. Please let us know if any
changes are required in this document.
If you already have plans to carry out a promotional activity, please let
me know. The communications clauses require that you notify this office at
least 21 days in advance of any planned event or promotional activity. This
allows for our input and planning for a federal representative to participate in
your special activity.
We look forward to discussing any promotional activities or announcements
that may be planned, and answering any questions about communications matters
related to your project. Please contact the undersigned at (902) 566-7491 or
via Email: jobrien@acoa.ca.
Thank you very much for your cooperation, and we're pleased to be able to
assist you. I trust your project will meet with success as it progresses.
Yours sincerely,
/s/ Jean O'Brien
Jean 0'Brien A/Director, Communications
Attachment
ANNEX 2
PROJECT FACT SHEET
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FOR NEWS RELEASE
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Program: Project No: BDP 5030890
ACOA Business Development Program
Name & Address of Applicant: Applicant Contact:
Island Critical Care Corporation Name: Ken Legere 29 HolliAan
Title: President
Nepean, ON K2J 3W9 Telephone: 613-823-4880
Fax; 613-823-4881
Project Location: Summerside, P.E.I. Project Type: Establishment
Project Description: Island Critical Care proposes to establish a
manufacturing facility in Prince Edward Island to manufacture leading edge
medical instrumentation for international distribution. The first product to be
manufactured by Island Critical Care Corporation will be a pulse oximeter that
incorporates signal extraction technology. ACOA's assistance will assist in the
acquisition of the plant equipment, the product certification and the marketing
activities associated with the product launch.
Total Costs: $2,960,000 Eligible Costs: $720.000
Authorized Assistance: $360,000
Job Creation/Maintenance: Cr: 36 Mn:
Estimated Sales Resulting from Project: (3 years)
Estimated Project Commencement Date: June 1, 1998
Estimated Completion Date: March 31, 2000
ACOA/APECA
RECEIVED/RECU
SEP 30 1999
Prince Edward Island & Tourism ile-du- prince-edouard et du tourisme