Contract
Exhibit 10.20
Certain
portions of the exhibit have been omitted based upon a request for confidential
treatment. The non- public information has been filed separately with the
commission.
An
agreement dated 7th January 2009 between Omex Agriculture Ltd. ("Omex") whose registered office
is Xxxxxxx Xxxxxxxx, Xxxxxxxx, Xxxxx. XX0 0XX and Pimi Agro Cleantech Ltd.
("Pimi") whose
registered office address is X.X. Xxx 000 Xxxxxx Xxxxxx 00000 Xxxxxx. Omex
and Pimi are together referred to hereafter as “The Parties”.
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Whereas
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1.
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Pimi
has developed a storage protocol and formulations for Stabilised Peroxide
used in the treatment of vegetables and fruit in stores and has filed for
patent registrations for such applications and
formulations;
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2.
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Pimi
has developed a product, 20% Storomex, the specification of which is more
particularly described in Appendix A ("The
Product").
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3.
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Pimi
has developed a Storage and Application Protocol for the Product ("The Storage Protocol"),
which is set out at Appendix E and which may be changed from time to time
by notice in writing given by Pimi.
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4.
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Omex
has the experience, resources and manpower in order to market , sell,
distribute and install the systems and equipment required for the
application of the Product in the countries identified in Appendix C
("The
Territories");and
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5.
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In
order to further develop the business of marketing and sales of The
Product in the Territories, The Parties wish to enter into a marketing and
distribution agreement, under which Omex will take upon itself to market,
sell, distribute, and install systems and equipment required for the
application of The Product in the Territories and Pimi will grant to Omex
exclusive distribution rights in the Territories and will sell The Product
to Omex under the terms and conditions set forth
herein.
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Agreement
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1.
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Pimi
will deliver The Product to Omex in accordance with the Specification set
forth in Appendix A, and subject to the tolerances stated
therein. Pimi will indemnify Omex from any loss directly
resulting from any deviation from specification of The Products, from any
toxic or other matter in The Products not identified in the Specification,
and from the implementation of the advice contained in the Storage
Protocol. However Pimi will not indemnify Omex in respect of any loss
relating to any application in respect of which the application conditions
differ materially from the Storage Protocol and/or the instructions given
by Pimi to Omex from time to time.
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1
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2.
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During
efficacy tests Omex will follow fully the instructions given by Pimi and
will report to Pimi throughout the
tests.
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3.
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Omex
and Pimi will maintain Product Liability insurance in a sum of not less
than $ 1 million in respect of the above liability per claim, and will
upon request give each other evidence of renewal of such
policy.
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4.
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Subject
to the terms and conditions stipulated herein Pimi hereby grants Omex
exclusive distribution rights in the Territories for the Term as herein
defined to market, promote and sell The Product for use only in the
Territories identified in Appendix C. The parties may from time to time
agree on adding new countries to The Territories by a written agreement
signed by both parties. Pimi will not sell The Product or any
other product derived from it for use as a storage enhancer to any
purchaser other than Omex in The Territories or to any other purchaser
elsewhere for distribution in The Territories during the
Term.
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5.
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The
price of The Product will be as agreed in Appendix B. Pimi has the right
to change the price from time to time in order to recover any increased
cost of such changes. Pimi will show Omex evidence that the raw material
has changed in price.
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6.
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Pimi
will have The Product available for delivery within 2 weeks of receipt of
a written or emailed order from Omex. Minimum order quantity is
1,000 Lt.
Omex will submit a forecast each quarter in
advance.
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7.
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Omex
will pay Pimi by the end of the month following delivery. Pimi
shall at the end of each seasonal year September-August credit Omex with a
sales rebate calculated in accordance with Appendix B and shall remit such
rebate to Omex by October 31st
each year.
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8.
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Risk
in and Title to The Product passes from Pimi to Omex at the point of
delivery in the Territory.
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9.
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Omex
will use all reasonable endeavours to market and promote The Product in
the Territories, and will perform at least the marketing activities as
described in Appendix D. All costs of marketing will be borne
by Omex. The Product will be marketed under a Trade Name Storomex which is
owned by Omex. All costs in relation to such name will be borne
by Omex. The title to the name shall remain with Omex on
termination of this Agreement. Omex shall display on the label
of the Product as well as all other commercial literature that the
supplier is Pimi and Omex is the distributor of the
Product,
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10.
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Should
in the opinion of Omex, The Product require registration with any
government agency, Omex undertakes to execute such registration and will
bear all costs in obtaining such registration. The registration
will be in Omex’s name and title to such registration will be retained by
Omex on termination of the
Agreement.
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11.
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Omex
accepts the following minimum targets for the sale of 20% Storomex for the
seasonal years September to August:
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9/ 2008-
8/2009: 2.2k litres
9/2009-
8/2010: 15k litres
9/2010-
8/2011: 37k litres
9/2011-
8/2012: 85k litres
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12.
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Omex
accepts the following targets to retain exclusive distributorship in the
territory for 20% Storomex, for the seasonal years September to
August:
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9/2008-
8/2009: 4.2k litres
9/2009-
8/2010: 29.6k litres
9/2010-
8/2011: 74.4k litres
9/2011-
8/2012: 170.4k litres
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13.
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Omex
will set the following sales targets for 20% Storomex for the
seasonal years September to August:
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9/2008-
8/2009: 8.6k litres
9/2009-
8/2010: 59.2k litres
9/2010-
8/2011: 148.8k litres
9/2011-
9/2012: 340.8 k litres
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14.
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Pimi
will provide Omex with all relevant technical information concerning The
Product and will provide technical support to Omex by means of telephone
calls, emails and support visits as required. In all papers and
publications it will be presented that the protocol of usage and the
formulation and patent are the intellectual property of Pimi and were
supplied by Pimi Xxxxxx to Omex under license as its distributor in the
territory. Pimi is entitled to use the data from efficacy trials to
promote SpuDefender in other
territories.
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15.
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Omex
will provide Pimi with information concerning the development of the
market, including market potential, sales projections on an annual basis,
reports on product performance and details of all customers with Storage
facilities in more than one
country.
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16.
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Omex
and Pimi will have at least two semi annual meetings in the UK according
to product development and crop seasons, including a budget meeting which
will be done in the last quarter of each year to decide on sales budget as
well as proposed marketing activities for the coming year. Each Party will
pay its own costs in relation to the meetings. Prior to each
semi annual meeting each party will forward to the other a paper
summarising the results of all product trials undertaken in the previous
season and all data received from customers concerning the efficacy of the
product.
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17.
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Omex
acknowledges that the patent applications and all other intellectual
property rights other than the rights to Trade Names and Product
Registrations are, and upon the termination of the Agreement, will remain
the property of Pimi. Omex will write on the label as well as on written
articles and paper that there is an IP to the product that belongs to Pimi
and is used under licence of Pimi. Omex undertakes not to
copy or re-engineer the Patented Product. All costs in relation
to patent applications and costs undertaken to defend the patents from
infringements by third parties are for the account of
Pimi. Pimi further undertakes to indemnify Omex in respect of
any costs or liabilities resulting from claims by third parties that the
Product infringes that party’s patent
rights.
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18.
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Omex
will nominate a project manager who will support the farmers in the
implementation of the Storage Protocol. The project manager will supervise
all new applications and trials.
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Term
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19.
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Subject
to Omex having fully complied with all the terms of this Agreement this
agreement shall be in effect from the date hereof until 31st
December 2012 (the "Term"), and shall
continue thereafter for consecutive one year terms, until terminated by
either party giving to the other six months notice in writing, and if such
notice is given six months prior to 31st
December 2012 it will terminate on that date. In the event that a party
commits a serious breach of this agreement and such breach is not remedied
within 30 days of receipt of written notice of said breach, the other
party may terminate this Agreement
forthwith.
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20.
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Should
Omex not make appropriate sales, or efforts to achieve sales, as shown in
section 12 above and Appendix D, then Pimi may change the
distribution terms granted to Omex to semi-exclusive (i.e. appointing one
additional distributor), after giving notice in writing of the shortfalls
and a period of time to rectify the situation
(90days).
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21.
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Should
Omex not achieve the minimum sales stated in section 11 above, then Pimi
may terminate the distributorship granted to Omex, after giving notice in
writing of the shortfalls and a period of time to rectify the situation
(90days). In this event, Pimi will allow Omex to retain supply of the
Product to its current customers until the end of the Agreement under
section 19 above and will supply Omex sufficient Product at the price set
out in Appendix B.
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Entire
Agreement
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22.
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This
Agreement constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes all prior agreements,
representations, understandings and arrangements of the parties related to
these matters, whether written or oral. No modification of any of the
terms of this Agreement shall be valid unless in writing and signed by an
authorized representative of each
party.
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Reports
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23.
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Omex
will report to Pimi in real time on any results of any trial to enable
Pimi to instruct on any change in the working parameters if required .
Additionally Omex will furnish to Pimi the results and conditions of any
storage which was done with the Product including, crop, quantities,
number of treatments, amount of the Product used, and the results of the
any such treatments.
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Law
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24.
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/s/
Xxxxxx Xxxx
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/s/
X. Xxxxxxxxxxxx
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Name: Xxxxxx
Xxxx
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Name: . X.
Xxxxxxxxxxxx
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Position:
CEO
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Position: Managing
Member
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| For and on Behalf of Pimi Xxxxxx Holdings | For and on Behalf of Omex Agriculture Ltd. |
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Appendix
A
Storomex™ Specification
November 2008
1. Name:Storomex™
2. Properties:
2.1 Appearance: colorless
transparent liquid
2.2 Smell: slightly
pungent
2.3
Ingredients: _______________18-20%
_______________ 8- 10%.
_______________ ____%
_________________%
2.4
Stability: Stable as Hydrogen Peroxide for 12 hours after applying.
Pimi will
deliver COA confirming the stability and specification of the product with each
delivery.
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APPENDIX
B
Prices
Product
Prices delivered UK.
Storomex
20 _____ Euro per Lt
delivered in IBC.
Rebate
programme:
Sep 2009/
Aug10:
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1.
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Purchases
above 50,000 Litres- 2% on all purchases for the
year
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2.
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Purchases
above 60,000 Litres- 4% on all purchases for the
year
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3.
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Purchases
above 70,000 Litres – 5% on all purchases for the
year
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Rebate
programme:
Sep 2010/
Aug 11:
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1.
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Purchases
above 130,000 Litres- 2% on all purchases for the
year
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2.
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Purchases
above 150,000 Litres- 4% on all purchases for the
year
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3.
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Purchases
above 160,000 Litres – 5% on all purchases for the
year
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Sep 2011/
Aug 12:
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4.
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Purchases
above 300,000 Litres- 2% on all purchases for the
year
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5.
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Purchases
above 350,000 Litres- 4% on all purchases for the
year
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6.
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Purchases
above 370,000 Litres – 5% on all purchases for the
year
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Appendix
C
Countries
for exclusivity
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UK
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Appendix
D
Sales and
Marketing activities by Omex will include:
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Production
of sales and promotional literature
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Production
of PowerPoint presentations- Pimi will be included as the supplier and
owner of the Product in it
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Xxxxxx
meetings and demonstrations –,
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Promotion
at relevant shows and exhibitions, including Potato
Events.
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Website
promotion – there will be a link to Pimi as the
supplier
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Targeted
sales campaigns led by an appointed person to see the following number of
farmers each seasonal year (September –
August):
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2008/9: 75
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2009/10: 110
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2010/11 255
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2011/12 500
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Developing
new applications (e.g. usage in onions, leeks, soil applications
etc)
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0
Xxxxxxxx
X
Application
Protocol for Storomex __% concentration for
use in potatoes and vegetables
1. Storage room
preparation:
1.1 Make
sure that the air circulation system functions correctly,
clean
air ducts, fans and plenum.
1.2
Maintenance treatment should be performed to the room and its equipment in order
to
protect
against corrosion due to continuous exposure to high relative
humidity.
1.3
General cleaning of the store
1.4 Check
proper functioning of the humidity control. Temperature control and CO2
control.
3. Room
filling:
Filling
the room with stored goods has to be done while taking in consideration air
circulation needs in order to ensure good and homogenous air movement through
the store.
4. Operating the room
controllers:
4.1
Temperature: control according to the customer protocol.
4.2
Humidity: keep constantly at 90%-92% R.H
5.
Applying Storomex:
5.1 Prior
to treatment take care that temperature and relative humidity is
stable.
5.2 Close
all doors, widows and air outlets.
5.3 Close
mechanical cooling system.
5.4 Check
that air circulation is proper functioning.
5.6 Open
the Storomex feed to the Ultrasonic Atomizers.
5.7 Treat
the crop at a ratio of 400-ml per 1 Ton of crop for potatoes; 200 ml/tonne for
brassicas. + adding 5 liters per 1,000 cubic
meter
of room head space
5.8
Treatment duration is approximately 20 hours.
6. Resting period (after the
end of the Storomex treatment):
6.1 Close
Storomex feeding valve.
6.2 Close
air feeding valve.
6.3 Close
air circulation system.
6.4 Keep
the room under full rest for more 4 hours.
7. Normal
operation:
7.1
Operate the air circulation system.
7.2
Operate the cooling system.
7.3
Operate the Temp Controller, the humidity controller.
7.5 Open
air feed and water feed to the Ultrasonic Atomizers.
7.6
Continue to operate the room under the controlled Temperature and Humidity as
described on chapter 4.
8. The program through the
whole storage period:
8.1 Once
a month storage manager should conduct steps 5, 6, 7.
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