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SUPPLY AND DISTRIBUTION AGREEMENT
THIS AGREEMENT is made as of the 31st day of July,
1996.
B E T W E E N :
SUPERCRETE N/A LIMITED, a corporation
incorporated pursuant to the laws of the
Turks & Caicos Islands, British West Indies
(hereinafter "Supercrete")
- and -
GLOBESAT INFRASTRUCTURE TECHNOLOGIES CORP., a
corporation incorporated pursuant to the laws
of State of Utah, U.S.A.
(hereinafter "Globesat")
- and -
STRATFORD ACQUISITION CORP., a corporation
incorporated pursuant to the laws of the
State of Minnesota, U.S.A.
(hereinafter "Stratford")
WHEREAS Globesat is the owner of the certain
technology, and in conjunction therewith owns the exclusive
rights to manufacture, market, sell and distribute certain
products throughout the United States of America;
AND WHEREAS Globesat wishes to obtain from
Supercrete, and Supercrete has agreed to grant, certain
additional exclusive rights to market, sell and distribute
the Additive (as hereinafter defined) in the Exclusive
Territory (as hereinafter defined);
AND WHEREAS Supercrete is a wholly-owned
subsidiary of Stratford;
AND WHEREAS Stratford has agreed to provide
Globesat with Technical Assistance (as hereinafter defined)
in connection with the foregoing, all upon the terms and
conditions contained herein;
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NOW THEREFORE this Agreement witnesses that in
consideration of the payments and mutual covenants herein
and other good and valuable consideration (the receipt of
which is hereby acknowledged by the parties hereto), the
parties agree as follows:
ARTICLE I - DEFINITIONS
1.01 In this Agreement, the following terms shall have
the following meanings unless the context implies otherwise:
"Additive" means the cementitious additive which has been
developed by and is manufactured and distributed by
Stratford, sometimes under the trade xxxx "Novacrete", and
which is combined with one or more aggregates to manufacture
Pre-Mix, and any and all new developments, innovations,
modifications or improvements to such additive as conceived,
developed or implemented by Stratford;
"Agreement" means this supply and distribution agreement, as
may be amended from time to time;
"Exclusive Territory" means the United States of America, ts
territories, protectorites and possessions;
"Globesat" means Globesat Infrastructure Technologies Corp.,
its parent, subsidiaries and affiliates, or any other form
of entity or organization, of which Globesat may or may not
be a party, partner or shareholder, as the case may be, and
its designees;
"person" means and includes any individual, corporation,
partnership, firm, joint venture, syndicate, association,
trust, government, governmental agency or board or
commission or authority;
"Pre-Mix" means any ready-to-use mortar mixture which
employs the Additive;
"Stratford" means Stratford, its subsidiaries and
affiliates, including Supercrete;
"Technical Assistance" has the meaning ascribed thereto in
Section 5.01 hereof; and
"Technology" includes, without limitation, any one or more
of the knowledge, information, know-how, manufacturing
equipment, plant, set-up, design and technology to combine
Additive and any one or more aggregates for the purpose of
manufacturing Pre-Mix or any other enhanced concrete product
whatsoever, and the knowledge, information and know-how to
locate suitable sources of local aggregates to combine with
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Additive to manufacture Pre-Mix or any other enhanced
concrete product whatsoever, in any particular country, part
of a country, territory or part of a territory.
ARTICLE II - APPOINTMENT OF EXCLUSIVE DISTRIBUTOR
2.01 During the term of this Agreement, and otherwise
subject to the terms and conditions contained herein,
Stratford hereby appoints Globesat as its sole and exclusive
distributor of the Additive and Pre-Mix in the Exclusive
Territory. Globesat hereby accepts such appointment.
2.02 Without limiting the generality of the appointment
referred to in Section 2.01 hereof, Globesat shall have the
right to market, sell and distribute the Additive and
pre-Mix to any person, or to appoint sub-distributors, on
either an exclusive or non-exclusive basis, in the Exclusive
Territory.
2.03 During the term of this Agreement, Stratford
covenants and agrees that it shall not market, sell or
distribute the Additive or Pre-Mix to any person (other than
Globesat) within any of the Exclusive Territory, nor shall
it market, sell or distribute the Additive or Pre-Mix to any
person (other than Globesat) who does or who intends to
market, sell or distribute the Additive or Pre-Mix within
the Exclusive Territory.
2.04 Stratford shall not knowingly market, sell or
distribute the Additive or Pre-Mix to any person outside of
the Exclusive Territory for import into the Exclusive
Territory. If Stratford learns that any of its distributors
or customers (other than Globesat) are exporting such
products into the Exclusive Territory, it will take such
steps, to the extent permitted by applicable laws, to ensure
that such distributor or customer ceases to export such
products into the Exclusive Territory.
ARTICLE III - SUPPLY OF ADDITIVE AND PRE-MIX
3.01 Stratford covenants and agrees that it shall at
all times, and within a commercially reasonable time, make
available to Globesat sufficient supply of Additive and
Pre-Mix that may be required by Globesat, from time to time,
to satisfy all of Globesat's demand, from time to time.
3.02 Stratford agrees to use its best efforts to meet
the delivery dates specified in all purchase orders for
Additive and/or Pre-Mix placed by Globesat with Stratford.
Stratford shall promptly notify Globesat of any delay or
anticipated delay in meeting such delivery date and shall
notify Globesat of the date on which it believes delivery
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will be made. Title to the product which is the subject of
a purchase order shall pass upon shipment from Stratford's
North American manufacturing facilities.
3.03 (a) Commencing from the date of this Agreement until
the expiry of the second anniversary thereof, unless the
parties otherwise agree in writing, the purchase price
of Additive from Stratford by Globesat shall be four
dollars ($4.00) per pound, subject to any applicable
volume discounts which may be provided by Stratford.
(b) Upon the expiry of the second anniversary
following the date of this Agreement, and upon completion of
each full year thereafter, the purchase price at which
Stratford sells Additive to Globesat hereunder may be
increased by Stratford, upon a minimum of ninety (90)days
advance notice in writing prior to such date, by an amount
equal to the increase in Stratford's costs, acting
reasonably. Stratford agrees to provide Globesat with such
supporting documentation as may be required to satisfy
Globesat of the amount of any increase in Stratford's costs.
(c) During the term of this Agreement and any renewals
hereof, the purchase price of Pre-Mix from Stratford
by Globesat shall be based upon the prevailing
wholesale prices, having regard to the quantity ordered, the
size of the bag of Pre-Mix, and the type and specifications
of any particular Pre-Mix, subject to any applicable volume
discounts which may be provided by Stratford.
3.04 Globesat acknowledges and agrees that the purchase
prices for Additive and Pre-Mix referred to above are
exclusive of any applicable taxes, duties and levies
whatsoever which may be imposed on the purchaser or importer
of same in any applicable jurisdiction, and exclusive of any
applicable shipping, handling or cartage charges. Unless
otherwise agreed by the parties in writing, the above-noted
prices are deemed to be F.O.B Stratford's North American
manufacturing facilities.
3.05 During the term of this Agreement and any renewals
hereof, Stratford covenants and agrees that, subject to
volume discounts which are also afforded to Globesat, it
shall not sell Additive or Pre-Mix to person (other than
Globesat), anywhere in the world, for an amount less than
the amount at which it sells Additive or Pre-Mix to Globesat
hereunder.
3.06 Globesat shall pay all amounts owing to Stratford
for any Additive and Pre-Mix purchase orders by way of an
irrevocable letter of credit. The terms of payment may be
changed or modified by the parties upon mutual agreement at
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any time.
3.07 Provided that the Technology is applied by
Globesat in a substantially correct manner (i.e., for
greater certainty, the Additive is formulated correctly),
Stratford warrants that all Additive supplied to Globesat
shall be free from defects of workmanship and shall be fit
for the purpose of blending to manufacture a superior
quality mortar with pre-determined performance
specifications. Stratford shall replace, at its sole cost
and expense (including shipping and handling expenses), any
Additive which is not fit for such purpose or which is
defective or faulty so as to be unsaleable and which
Globesat returns to Stratford. Stratford warrants that all
Pre-Mix supplied to Globesat shall be free from defects of
workmanship. Stratford shall replace, at its sole cost and
expense (including shipping and handling expenses), any
Pre-Mix which is defective or faulty so as to be unsaleable
and which Globesat returns to Stratford.
3.08 The warranties applicable to each of the Additive
and Pre-Mix sold to Globesat under this Agreement shall
conform to the separate manufacturing product warranties
then in effect with respect to such products and Globesat
agrees to inform its customers and distributors of such
warranties and any changes thereto that Stratford supplies
to Globesat from time to time.
3.09 For greater certainty hereunder, the parties agree
that the price at which Globesat sells Additive and/or
Pre-Mix to any person shall be at Globesat's sole and
absolute discretion.
ARTICLE IV - PERFORMANCE AND PRODUCT DISTRIBUTION
4.01 During the term of this Agreement, Globesat
covenants and agrees that it shall use its reasonable best
efforts to market and promote the Additive, Pre-Mix, and the
goodwill associated therewith.
4.02 During each year of the term of this Agreement and
any renewals hereof, Stratford covenants that it shall
contribute the amount of ten thousand dollars ($10,000)
annually towards the cost of any advertising and marketing
materials to be used by Globesat in conjunction with
Globesat's marketing of the Additive and Pre-Mix, provided
that Stratford shall have the right to review and revise any
such materials to ensure that same accurately informs as to
the specifications, standards, and performance of the
Additive and any Pre-Mix.
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4.03 Subject to Section 4.06 hereof, Globesat shall be
required to meet the following minimum purchase quotas
during the
initial term of this Agreement derived from sales in the
Exclusive Territory:
(a) from the date of this Agreement until November 30,
1997, Globesat shall be required to purchase a minimum
of one million dollars ($1,000,000) of Additive;
(b) during the second year of the term (i.e., until
November 30, 1998), Globesat shall be required to
purchase a minimum of one million dollars ($1,000,000)
of Additive;
(c) during the third year of the term (i.e., until
November 30, 1999), Globesat
shall be required to purchase a minimum of one million
dollars ($1,000,000) of Additive;
(d) during the fourth year of the term (i.e., until
November 30, 2000), Globesat shall be required to
purchase a minimum of one million dollars ($1,000,000)
of Additive;
(e) during the fifth year of the term (i.e., until
November 30, 2001), Globesat shall be required to
purchase a minimum of one million dollars ($1,000,000)
of Additive; provided that any annual purchase
requirement may be reduced to the extent that any
preceding annual purchase requirement has been
exceeded, such that the purchase requirements for any
year does not exceed the amount stated above in each
subparagraph.
4.04 Globesat may, at its option, pay to Stratford the
difference between the amount of purchases in any given year
and the minimum annual purchase requirement for such year.
4.05 Should Globesat fail to meet any minimum annual
purchase requirement as aforesaid, the rights granted to
Globesat in Article II hereunder shall thereupon become
non-exclusive rights in respect of the Exclusive Territory
upon thirty (30) days' written notice by Stratford to
Globesat specifying same. Notwithstanding the provisions of
Section 9.04 hereof, this section is the sole remedy of
Stratford in respect of the failure of Globesat to meet any
minimum annual purchase requirements as aforesaid.
4.06 In the event that Stratford is unable to supply
Globesat with sufficient Additive or Pre-Mix to meet any of
its
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minimum annual purchase requirements in any annual period,
then the minimum annual purchase requirement for such period
shall be reduced to an amount equal to the quantity of
product supplied by Stratford in that period.
ARTICLE V - TECHNICAL ASSISTANCE AND TRAINING
5.01 Stratford covenants and agrees that, subject to
the confidentiality provisions contained herein, upon the
request of Globesat, it shall promptly provide Globesat and
any person designated by Globesat with such technical
assistance as will enable such person to manufacture Pre-Mix
of saleable quality ("Technical Assistance"), including
without limitation, assistance in sourcing local aggregates,
assistance in utilizing and/or modifying Globesat's existing
mortar blending equipment, and assistance in establishing
the proper combination of Additive and local aggregates, all
of which aim for and will result in Globesat being able to
properly and efficiently blend the Additive with such local
aggregates to manufacture Pre-Mix meeting specified saleable
requirements.
5.02 Stratford covenants and agrees that in respect of
each distributor arrangement or blending operation
established by Globesat in respect of the Additive, it shall
provide to Globesat all of the necessary blending equipment
required for the distributor to commence blending
operations, to a maximum of one hundred thousand dollars
($100,000) of blending equipment, provided that the
distributor or blender, as the case may be, posts a
performance bond, acceptable to Stratford, to ensure the
purchase of a minimum of two hundred and twenty thousand
pounds (220,000 lbs.) of Additive during the first year of
the initial term of any such distributor or blending
agreement.
5.03 In the alternative to the provision of equipment
as provided in Section 5.02 hereof, at the option of
Globesat, Stratford shall provide a product purchase price
credit to Globesat in the amount of one hundred thousand
dollars ($100,000), to be applied against any order of
Additive of equal or greater value.
5.04 Technical Assistance and support shall be provided
by Stratford, its agents, and employees, as requested or
required, provided that Stratford shall be solely
responsible for the costs associated with the provision of
initial Technical Assistance to implement and commence the
manufacturing/blending process, which Technical Assistance
shall be limited to the provision of one qualified Stratford
agent or employee for and during a period of seven (7) days
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only, along with all written materials regarding the
manufacture of Pre-Mix then available, and thereafter
Globesat shall be responsible for Stratford's reasonable
costs incurred in providing any additional Technical
Assistance.
5.05 Stratford shall provide initial technical training
to such agents and employees of Globesat that may require
same for the performance of their duties, provided that
Stratford shall be solely responsible for the costs
associated with the provision of initial technical training
to a reasonable number of agents and/or employees, which
technical training shall be limited to the provisions of one
qualified Stratford agent or employee for and during a
period of seven (7) days only, and thereafter Globesat shall
be responsible for Stratford's reasonable costs incurred in
providing any additional technical training or retraining.
ARTICLE VI - COVENANTS OF STRATFORD
6.01 Stratford warrants, covenants and agrees that it
has the right to enter into this Agreement and to grant to
Globesat the exclusive distributorship arrangement outlined
herein in the Exclusive Territory and agrees to indemnify
and save harmless Globesat, its officers and employees, in
connection with any claims which might be asserted against
Globesat by others claiming title to the Additive or Pre-Mix
or a prior right granted by Stratford to distribute such
products in the Exclusive Territory. Upon the execution of
this Agreement, Stratford agrees to provide notice to any of
its authorized suppliers and agents of the exclusive
distributorship granted to Globesat hereunder.
6.02 Stratford covenants and agrees that it shall refer
all inquiries regarding the purchase of Additive or Pre-Mix
within any Exclusive Territory to Globesat.
6.03 Stratford covenants and agrees that, upon
execution of this Agreement, it shall fully divulge and
deliver to Globesat any and all information and particulars
with respect to the Technology and the Additive as necessary
or required, and the technical information and processes
related thereto. In the event of any innovation,
modification or improvement to such technical information
and processes, or any new development with respect thereto,
it shall forthwith disclose and provide full particulars to
Globesat for its use and implementation, subject to the
terms and conditions contained herein.
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ARTICLE VII - AGENTS
7.01 Globesat shall be permitted to engage and employ
such agents to assist Globesat in carrying out its duties
and responsibilities hereunder, upon such terms and
conditions as Globesat, in its sole and absolute discretion
deems acceptable.
7.02 It is expressly understood and agreed that
Globesat shall be solely responsible for any remuneration or
commissions earned or expenses incurred by any agents and
shall, under no circumstances, be entitled to any
reimbursement of any such expenses whatsoever from
Stratford.
ARTICLE VIII - CONFIDENTIALITY
8.01 Globesat covenants and agrees not to use or
disclose to any third party or use at any time contrary to
the interests of Stratford any trade secrets, confidential
information, knowledge or data relating to the business and
affairs of Stratford, the Technology, or the Additive that
Globesat may have, obtain or acquire as a result of this
Agreement, other than in the performance of its duties and
obligations hereunder, and in connection therewith Globesat
agrees to execute and abide by any confidentiality agreement
that Stratford may from time to time require, acting
reasonably.
8.02 Neither party shall directly or indirectly, at any
time, without the express written consent of the other,
publish, disclose or divulge to any person any trade
secrets, knowledge, data, or confidential information of any
nature relating to the business and the affairs of the other
party, or relating to any of the particulars of the
relationship between Stratford and Globesat created
hereunder, which either may have imparted to the other or
which they may acquire or become aware of during or as a
result of the appointment of Globesat herein.
8.03 Without in any way limiting the generality of the
foregoing, Stratford specifically covenants and agrees that
it shall maintain the confidentiality of the cost to
Globesat of Additive and Pre-Mix from Stratford, and shall
under no circumstances disclose same to any person.
8.04 The provisions of this Article VIII shall survive
the termination or non-renewal of this Agreement.
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ARTICLE IX - TERM AND TERMINATION
9.01 This Agreement shall be effective from the date
hereof and shall be for a term of five (5) years from
November 30, 1996 (the "Initial Term"), unless otherwise
terminated as provided hereunder.
9.02 If Globesat gives Stratford ninety (90) days'
written notice prior to the expiry of the Initial Term, at
the option of Globesat, this Agreement shall be renewable
for a further five (5) year period (the "Extended Term")
provided that Globesat has paid to Stratford the amounts set
out in Article V hereof during the Initial Term. The terms
and conditions of this Agreement shall remain in full force
and effect, unamended, during the Extended Term, with the
exception of Section 4.03, which shall provide for minimum
purchase quotas for each of the five years during such term
equal to the mean of total purchases by Globesat of Additive
in years three to five, inclusive, of the Initial Term.
Globesat, shall have the option to renew this Agreement for
an additional five (5) year term thereafter on the same
terms and conditions as under the Extended Term, with the
exception of Section 4.03, which shall provide for minimum
purchase quotas for each of the five years during such term
equal to the mean of total purchases by Globesat of Additive
in years three to five, inclusive, of the Extended Term.
9.03 Either party may terminate this Agreement at any
time without notice, if the other party:
(a) makes an assignment for the benefit of its
creditors;
or
(b) is adjudicated bankrupt or becomes voluntarily or
involuntarily subject to any proceedings for the
benefit of its creditors.
9.04 Either party may terminate this Agreement at any
time, if the other party fails to comply with any material
term or condition of this Agreement or fails to fulfil or
comply with any obligation undertaken by it pursuant to this
Agreement and such default is not cured within thirty (30)
days of written notice given in respect thereof.
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ARTICLE X - GENERAL PROVISIONS
10.01 Any notice or other communications (a
"Notice")required or permitted to be given hereunder shall
be in writing and shall be delivered in person, transmitted
by facsimile or sent by registered mail, charges prepaid,
addressed as follows:
(a) if to Supercrete:
0000 Xxxxx Xxxxxxx Xxxx
0xx Xxxxx
Xxxxxxxxxx, Xxxxxxx X0X 0X0
Attention: Mr. Xxxxxx Xxxxx
Facsimile No.: (000) 000-0000
(b) if to Globesat:
000 Xxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx X0X 0X0
Attention: Xx. Xxx X. Xxxxxxxxxx
Facsimile No.: (000) 000-0000
(c) if to Stratford:
0000 Xxxxx Xxxxxxx Xxxx
0xx Xxxxx
Xxxxxxxxxx, Xxxxxxx X0X 0X0
Attention: Mr. Xxxxxx Xxxxx
Facsimile No.: (000) 000-0000
or at any such other address or addresses as may be given by
any of them to the other in writing from time to time. Such
Notice, if mailed, shall be deemed to have been given on the
second business day (except Saturdays or Sundays) following
such mailing, or if delivered personally or transmitted by
facsimile, shall be deemed to have been given on the day of
delivery or transmission, as the case may be, if a business
day, or if not a business day, on the business day next
following the day of delivery or transmission, as the case
may be; provided that if such Notice shall have been mailed
and if regular mail service shall be interrupted by strike
or other irregularity before the deemed receipt of such
Notice as aforesaid, then such Notice shall not be effective
unless delivered or transmitted by facsimile.
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10.02 Any delay or failure of any party hereto to
perform its obligations under this agreement shall be
excused if, and to the extent, that the delay or failure is
caused by an event or occurrence beyond the reasonable
control of the party and without its fault or negligence,
such as, by way of example and not by way of limitation,
acts of God, action by any governmental authority (whether
valid or invalid), fires, floods, wind storms, explosions,
riots, natural disasters, wars, sabotage, labour problems
(including lock-outs, strikes and slow-downs), inability to
obtain power, material, labour, equipment or transportation,
or court injunction or order; provided that written notice
of delay (including the anticipated duration of the delay)
shall be given by the affected party to the other party
within ten (10) days.
10.03 This Agreement is not assignable by Globesat
without the prior written consent of Stratford, which onsent
shall not be unreasonably withheld.
10.04 Unless otherwise indicated herein, all dollar
amounts referred to in this Agreement are in lawful money of
the United States of America.
10.05 This Agreement does not create a partnership
or joint venture between the parties and does not grant any
right to either to assume or create obligations or
responsibilities, express or implied, on behalf of or in the
name of the other party or to otherwise bind the other party
in any manner whatsoever, other than as specifically
provided for hereunder.
10.06 The failure of either party hereto at any
time to require performance by the other party of any
provision hereof shall in no way affect the right of such a
party to require such performance at any time thereafter nor
shall the waiver by either party of a breach of any
provision hereof constitute a waiver of any subsequent
breach of the same or any other provision nor constitute a
waiver of the provision itself.
10.07 In the event that any one or more of the
provisions of this Agreement shall at any time be declared
to be invalid or otherwise rendered unenforceable by
judicial or administrative decision, unless the invalidity
or unenforceability of such provision does substantial
violence to the underlying purport and meaning of the
remainder of this Agreement, it is the intention of the
parties that such invalidity or unenforceability shall not
affect the validity or enforceability of any other
provisions of this Agreement, except those with respect to
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which such invalid or unenforceable provisions comprise an
integral part thereof or are otherwise clearly inseparable
therefrom.
10.08 This Agreement supersedes any prior
agreements or understanding, either oral or in writing
between the parties and constitutes the entire Agreement
between the parties relating to the subject matter hereof.
No amendments, variations, or alterations to this Agreement
shall be valid or binding upon the parties hereto unless
made in writing and agreed to by both parties.
10.09 Except as otherwise contemplated herein, no
announcement with respect to this Agreement will be made by
any party hereto without the prior approval of the other
parties hereto. The foregoing will not apply to any
announcement by any party hereto required in order to comply
with laws pertaining to timely disclosure, if applicable,
provided that such party hereto consults with the other
parties hereto before making any such announcement.
10.10 This contract shall be governed by and
construed in accordance with the laws of the Province of
Ontario, and each party hereby irrevocably attorns to the
jurisdiction of the
Courts of Ontario.
10.11 This Agreement shall enure to the benefit of
and shall be binding upon the parties hereto and their
respective successors and assigns.
IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the date first above written.
SUPERCRETE N/A LIMITED
Per: /s/ Xxxxxx Xxxxx, Designated Signing Officer
GLOBESAT INFRASTRUCTURE TECHNOLOGIES CORP.
Per: /s/ Xxx X. Xxxxxxxxxx, President
STRATFORD ACQUISITION CORP.
Per: /s/ Xxxxxx Xxxxx, President
