EXHIBIT 4.18
EXCLUSIVE INTERNATIONAL SALES, MARKETING
MANUFACTURING AND ADMINISTRATIVE AGREEMENT
(hereinafter called the "Agreement")
between
CBQYM INC.
(an Ontario Corporation)
(hereinafter called "Grantor")
and
CBQYM INC.
(a Barbados Corporation)
(hereinafter called "Grantee")
DATED THIS 4TH DAY OF JULY, 1996
Whereas, the Grantor, being a company incorporated under the laws on Ontario,
Canada, has acquired, under a license agreement (hereinafter called the "Licence
Agreement") with CIMAB S.A. located in the Republic of Cuba, certain rights to
processes technologies, compounds or products (hereinafter called "Licenced
Products") for the purposes of commercialization in certain territories, which
in addition includes certain first rights of refusal for additional products or
extensions of the rights to the Licensed Products; and
Whereas, the Grantor requires a company to develop markets in various locations
outside of Canada, such development to include all aspects technology and
product development, marketing, sales, manufacturing and administration, where
and if required, in such markets; and
Whereas, the Grantee, being a company incorporated under the laws of Barbados,
is willing to provide the technical and financial support and professional
resources to develop markets in territories outside of Canada (hereinafter
called "Territories").
Now therefore in consideration of the premises and of faithful performance of
the covenants herein contained, the parties hereto agree as follows:
1. Definitions
Licenced Product(s) shall mean those technologies process or products,
patented or unpatented, and intellectual property that Grantor has
acquired and may acquire under the licence agreement between Grantor and
CIMAB S.A. dated May 3rd, 1995 (the "Licence Agreement") and described in
Schedule 1(one).
Net Profit Value shall mean annual sales value of any Licensed Product(s)
sold less any discounts or rebates on such sales, less any cost of sales,
commissions, wages, expenses and other costs related to the products sold.
Territory shall mean those countries as specified in the Licence Agreement
excluding Canada.
Affiliate means any corporation or other business entity that directly or
indirectly controls, is controlled by, or is under common control with,
Grantee. Control means direct or indirect ownership of or other beneficial
interest in fifty percent (50%) or more of the voting stock, other voting
interest or income of a corporation or other business entity.
2. Grant
The Grantor hereby grants and Grantee accepts an exclusive right and
licence in the Territory, subject to any provisions in the Licence
Agreement, to develop, market, sell, manufacture and administer Licenced
Products.
3. Compensation
In consideration of the rights granted herein, Grantee shall pay to
Grantor an amount equal to eleven and a half percent (11.5%) of the Net
Profit Value.
The Grantee agrees to pay the aforementioned compensation to the Grantor
on a quarterly basis in arrears. Such payment will be made within thirty
days of the end of each calendar quarter.
The Grantee also agrees to provide the Grantor with unaudited financial
statements at the end of each quarter, together with a statement of the
amount due under the agreement and a reconciliation of the Net Profit
Value.
The Grantee shall maintain accurate books and records in sufficient detail
to enable the payments due hereunder to be determined. Such records shall
be available on request by Grantee for inspection, during normal business
hours, by Grantor's independent auditors.
All payments, financial reports, statements or other information shall be
in Canadian dollars.
The reports shall be provided in English.
The Grantor and the Grantee shall have the right to offset any amount or
balances due from one to the other under this Agreement.
4. Term of Agreement
This Agreement shall be effective as of the date first set forth above
and shall continue in full force and effect, unless earlier terminated as
herein provided, until the expiration of the last to expire of the rights
to Licenced Products under Licence Agreement.
This Agreement maybe cancelled only upon the mutual written consent of
both parties, or by either party on the provision of formal notice of
cancellation. Such cancellation shall occur on December 31 of the fifth
year after the year in which the notice of cancellation was given; and,
This Agreement may shall terminate automatically at any time should the
Grantee becomes insolvent, bankrupt, go into liquidation or be acquired or
controlled by any other company, group or organization.
Termination of this Agreement shall not terminate Grantee's obligations to
pay fees and royalties that shall have accrued hereunder or Grantee's
obligations.
5. Performance
During the term of this Licence Agreement. Grantee shall use its best
efforts to administer, manufacture, have manufactured, sell lease or
otherwise transfer the Licenced Products in order to maximize Net Profit
Value in the Territory and any other market where the Licenced Products
can be lawfully marketed without violating any other agreement of Grantor.
The Grantee shall effectively carry out its development and marketing plan
submitted with its application for the licence granted in this Licenced
Agreement, and shall take those steps necessary to effectively bring the
Licenced Product(s) to a point of practical application within a
reasonable time, and shall make the Licenced Product(s) reasonably
available to the public.
During such period, should the Grantee not bring the Licenced Product(s)
known and available to the public in reasonable quantities, for reasonable
consideration and at reasonable cost, Grantee shall have the right to
petition Grantor for an extension of such period. Grantor shall not
unreasonably reject such petition if the petition is supported by a
substantial showing that Grantee has diligently used reasonable efforts to
bring the Licenced Products to a point of practical application and make
the Licenced Products available to the public. Should such showing not be
made to Grantor's satisfaction, Grantor shall have the right, in its sole
discretion, to modify or terminate this Licence Agreement.
6. Nothing in the Agreement shall be construed as a warranty or
representation by Grantor as to the validity of any patents. Nothing in
this Agreement shall be construed as a warranty or representation by
Grantor that anything made, used, sold or otherwise disposed of under any
licence granted under this Agreement is or will be free from infringement
of patents of third parties.
7. Indemnity
Grantee will indemnify and hold Grantor harmless against all actions,
suits, claims, demands, or prosecutions that may be brought or instituted
against Grantor based on or arising out this Agreement, including; without
limitation, the following:
a) the manufacture, packaging, use or sale of Licenced Products by
Grantee, and Affiliates or their transferees;
b) any representation made or warranty given by Grantee or any affiliates
with respect to any Licenced Products.
8. Dispute Resolution
All dispute or differences arising out of the interpretation of this
Agreement shall be settled by two independent arbitrators, once chosen by
each party.
In the event that no decision can be reached by the arbitrators, an umpire
shall be appointed by the arbitrators. The decision of the arbitrators or
the umpire shall be final and not subject to appeal. Each party shall bear
the cost of arbitration equally and this article shall survive the
termination of this Agreement.
9. Notices
Any notice, reports, payments or statement required or permitted under
this Agreement shall be sufficient if sent by certified mail or electronic
form to:
President President
CBQYM INC. CBQYM INC.
5045 Orbitor Drive The Life of Barbados Building
Building 11, Suite 400 St. Michael, Barbados
Mississauga, Ontario West Indies
L4W 4Y4
10. Miscellaneous
This Agreement shall be governed by laws of Ontario.
This Agreement is not assignable.
This Agreement may not be altered, amended, modified or terminated except
pursuant to a written agreement duly executed and delivered by each of the
parties hereto.
Subject to the representation and warranties contained herein, this
Agreement contains the whole of the agreement between the parties and
there are no collateral or precedent representation, agreements or
conditions not specifically set forth herein.
IN WITNESS WHEREOF and intending to be legally bound hereby, each of the parties
hereto has caused this Agreement to be executed by it's duly authorized
representative on the date first above.
CBQYM INC.
(Ontario)
by:
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Title:
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CBQYM INC
(Barbados)
by:
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Title:
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