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Exhibit No. 5
Form 10-SB
Transform Pack International, Inc.
TRANSFORM
PACK
MASTER LICENSE AGREEMENT
Between
TRANSFORM PACK INC.
And
XXXXX X. XXXXXXXXXX, on behalf of a company
which is to be incorporated
as TRANSFORM PACK EUROPE INC.
July 24, 1995
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MASTER LICENSE AGREEMENT
THIS AGREEMENT made the 24th day of July, 1995.
BETWEEN:
TRANSFORM PACK INC., a body corporate, 000 Xxxxxxx
Xxxxx, in the City of Moncton, New Brunswick, Canada,
as represented by its President, XXXXXXX XXXXXXX, its
Vice-President Marketing and R&D, XXXX XXXXX, and
its Vice-President Production, XXXXXXX XXXXX, hereinafter
referred to as the "Grantor",
OF THE IFIRST PART
- and -
XXXXX X. XXXXXXXXXX, Executive Management
Consultant, of Xxxxxxxxxxxxx 00, Suite
41, A-8010 Graz, Austria, Europe, on behalf of a
company which is to be incorporated, hereinafter referred to as
the "Licensee"
OF THE SECOND PART
WHEREAS the Grantor is engaged in the research, development,
manufacture and sale of unique adhesives and marinating spices and
flavours used in combination with one-step TRANSFORM Pack process
more specifically described in the Canadian Patent Application
entitled "Method and Material For Extending The Shelf-Life of
Fresh Foods" filed November 9th, 1994, as number 2135416 a copy of
which is attached hereto as Schedule "A" and being more generally
described in the Marketing Brochure attached hereto as Schedule
"B" hereinafter collectively called the "Licensed Technology";
AND WHEREAS the Grantor intends to file a PCT patent
application with respect to the Licensed Technology for the
geographic area (the "Territory") consisting of Europe (including,
without restricting the generality of the foregoing, the European
Economic Community, Switzerland, Norway and also the reformed
states of the East, i.e. Russia, White Russia, Ukraine, Balkan
States and Turkey);
AND WHEREAS the Grantor is the owner of certain technological
knowledge with respect to research, development, manufacture and
sale of unique adhesives and marinating spices and flavours used
in combination with one-step TRANSFORM Pack process more
specifically described in the Canadian Patent Application entitled
"Method and Material For Extending The Shelf-Life of Fresh Foods"
filed November 9th, 1994, as number 2135416 a copy of which is
attached hereto as Schedule "A" and being more generally described
in the Marketing Brochure attached hereto as Schedule "B",
hereinafter collectively called the "Licensed Technology";
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AND WHEREAS the Licensee has requested from the Grantor an
exclusive license to commercially exploit the Licensed Technology
in the Territory and the Grantor has agreed to provide an
exclusive license to the Licensee upon the terms and conditions as
hereinafter set out in this Agreement;
NOW THEREFORE IN CONSIDERATION of the mutual covenants and
agreements herein contained, the parties covenant and agree with
each other as follows:
ARTICLE I - INTERPRETATION
1. 1 Definitions
1.1.1 In this Agreement, and the attached Schedules (unless
otherwise indicated) the following expressions shall have the
respective meanings indicated below:
"Adhesives" - has the meaning ascribed to it as set out in
the Canadian Patent Application entitled "Method and Material
For Extending The Shelf-Life of Fresh Foods" filed November
9th, 1994, as number 2135416 a copy of which is attached hereto as
Schedule "A" and being more generally described in the Marketing
Brochure attached hereto as Schedule "B".
"Affiliate" of a specific party means any other person or
entity that, directly or indirectly, controls or is controlled
by or is under common control with such specified party.
"Agreement" - means this Agreement, all Schedules and other
attachments to this Agreement and any documents incorporated
herein by reference and includes all amendments to this
Agreement agreed to in writing by the parties hereto.
"Know-How" includes all technical information, procedures,
processes, spices and flavours (including formulas), Trade
Secrets (except for the formula of the adhesives), methods,
practices, techniques, information, bills of parts, diagrams,
drawings, specifications, blue- prints, lists of materials,
labour and general costs, production manuals and data relating to
the design, manufacture, production, inspection and testing of the
Products using the Licensed Technology, existing as at the date
of this Agreement and anytime hereinafter acquired by the
Grantor during the term of this Agreement with free right of
disposal;
"Licensed Technology" shall mean collectively the Patents and
Know-How existing as at the date of this Agreement and anytime
hereinafter acquired by the Grantor during the term of this
Agreement with free right of disposal;
"Gross Revenues" shall mean in respect of any particular
period the revenue derived from the gross sales of Products
sold by the Licensee and Sub-Licensees in the Territory,
excluding:
(i) raw materials, which includes the support matrix (film,
the glue and spice mix)
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all materials necessary to package the Products, supplies and
wages and benefits directly related to the price of labour to
manufacture of Products in the Territory;
(ii) returns, discounts, value added or sales taxes or other
similar taxes payable on the amounts so charged; and
(iii) non-refundable advance payments received by the
Licensee from Sub-Licensees and any and all revenues received
by the Licensee from the sale of equipment.
"Marketing Brochure" refers to the Marketing Brochure prepared by
or on behalf of the Grantor and attached hereto as Schedule "B".
"Needs of the Market" - means that, in respect of the Products,
(i) they have been approved by all health, safety and governmental
regulatory agencies and/or authorities and the Licensee has
received formal clearance and approval for the sale, distribution
and marketing of the Products in the Territory, and (ii) there
exists, in the Territory, a genuine, real and substantial consumer
demand- for the Products to permit a viable and profitable
business operation for the Licensee.
"Patents" shall mean the Canadian Patent Application entitled
"Method and Material For Extending The Shelf-Life of Fresh Foods"
filed November 9th, 1994, as number 2135416 a copy of which is
attached hereto as Schedule "A" and being more generally described
in the Marketing Brochure attached hereto as Schedule "B" and
shall include improvements and modifications thereof and any
supplementary applications for patents for improvements and
modifications thereof;
"Products" shall be deemed to be those items to be manufactured
according to the Patents and Know-How as generally disclosed in
the Patents, Know-How and Marketing Brochure, and shall refer to
and include the use of Adhesives and marinating spices and
flavours (except for Proprietary Marinating Spices and Flavours),
as more specifically set out on Schedule "C";
"Proprietary Marinating Spices and Flavours" shall mean customized
marinating spices and flavours specially created, formulated and
prepared at the request and instructions of a client of either the
Grantor or Licensee with respect to that client's private food
label or labels.
"Trade Marks" shall refer to those Trade Marks set out on Schedule
"D" and shall include all trade marks and trade names that may in
the future be adopted by the Licensee in connection with the
Licensed Technology exploited by the Licensee.
"Territory" means the geographic area consisting of Europe
(including without restricting the generality of the foregoing,
the European Economic Community, Switzerland, Norway and also the
reformed states of the East, i.e. Russia, White Russia, Ukraine,
Balkan States and Turkey).
"Trade Secrets" means the formulae for Adhesives, including all
technical information,
specifications, procedures, processes, spices and flavours
(including formulas), Trade
Secrets, methods, practices, techniques, information, bills of
parts, diagrams, drawings,
specifications, blue-prints, lists of materials or secret
processes or other confidential
information, with respect to the Canadian Patent Application
entitled "Method and
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Material For Extending The Shelf-Life of Fresh Foods" filed
November 9th, 1994, as
number 2135416 a copy of which is attached hereto as Schedule "A"
and being more
generally described in the Marketing Brochure attached hereto as
Schedule "B".
1.2 - Interpretation
1.2.1 - Where the context permits, words importing the singular
number only shall include the plural and vice versa, words
importing any gender shall include all other genders and words
importing persons shall include corporations, and vice versa. The
headings or sub-headings of Articles to this Agreement are
inserted for convenience of reference only and shall not in any
way affect the interpretation of this Agreement. References to any
agreement incorporated herein by reference or schedule shall
include reference to any amendment or modification of such
agreement.
1.2.2 - The terms "this Agreement", "hereof", "hereunder",
"herein", and similar expressions refer to this Agreement and not
to any particular Articles, Section, Sub-Section, Clause or
Paragraph of this Agreement, unless the context otherwise
requires, and include any agreements supplemental hereto.
1.2.3 - Unless otherwise stated herein, all references to currency
in this Agreement are to lawful money of Canada.
1.3 - Schedules
1.3.1 - The parties agree that the following Schedules are
incorporated into this Agreement and form an integral part hereof.
Schedule A - Canadian Patent Application entitled "Method and
Material For Extending The Shelf-Life of Fresh Foods" filed
November 9th, 1994, as number 2135416.
Schedule B - Marketing Brochure prepared by Grantor.
Schedule C - List of Countries in the European Patent Group plus
Finland, Norway and Hungary, all of which are underlined in red on
the sheet attached to this Agreement as Schedule "C" with respect
to PCT Patent Application required to be filed by the Grantor.
Schedule D - List of Grantor's Trade Marks.
Schedule E - Bank account number and name and branch of the
Grantor's bank.
Schedule F - Promissory Note.
Schedule G - Licensee's Action Plan for design and manufacture of
equipment.
ARTICLE II - GRANT OF LICENCES
2.1 - Grant of License
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2.1.1 Exclusive Grant: The Grantor grants to the Licensee the
exclusive license to commercially exploit the Licensed Technology
in the Territory, and without limiting the generality of the
foregoing includes the exclusive license to:
(a) manufacture in the Territory the Products;
(b) distribute, use and sell only throughout the Territory,
the Products;
(c) use the Trade Marks in conjunction with the Products
throughout
the Territory; and
(d) manufacture in the Territory the equipment and machinery
necessary to
manufacture and produce the Products covered by the
Licensed Technology.
2.1.2 The Licensee acknowledges that some or all of the Know-How
has been disclosed and delivered to the Licensee in confidence
prior to and in contemplation of the execution of this Agreement.
The remainder of the Know-How shall be furnished to the Licensee
as soon as possible after the date of execution of this agreement
but not later than the incorporation of Transform Pack Europe Inc.
2.1.3 The Grantor shall furnish to the Licensee all of the Know-
How in its possession and existing at the date of this Agreement
and also furnish to the Licensee any Know-How hereinafter acquired
by the Grantor during the term of this Agreement.
2.1.4 The Grantor warrants that there are no other existing
licenses of the Licensed Technology in the Territory and covenants
that no disclosure to third parties will be made by it of Trade
Secrets in the Territory while this Agreement is in force.
2.1.5 The Grantor shall permit the Licensee at its sole cost and
expense to take all necessary steps to enforce any and all rights
granted under this Agreement, and in particular to take legal
proceedings against third parties to stop and prevent them from
infringing the Licensed Technology, including Trade Marks in the
Territory, subject to consultation with the Grantor as to anything
respecting the validity of the Licensed Technology or Trade Marks.
Any and all damages or awards received by the Licenseee as a
consequence of taking legal action against third parties
infringing the Licensed Technology in the Territory shall not be
included in the calculation of Gross Revenues and such awards or
damages shall be for the use and sole benefit of the Licensee.
2.1.6 The Grantor agrees to use its best efforts to ensure that
the Licensed Technology, including the Patents and Know-How, will
be sufficient and suitable for the manufacture of quality Products
in the Territory.
2.1.7 The Grantor shall permit the Licensee to incorporate a legal
entity in the Territory under the name Transform Pack Europe Inc.
or such similar corporate name as may be approved and at the
expiration or lawful termination of the Agreement the Licensee
covenants and agrees to change its name to a corporate name
different from that of "Transform Pack Europe Inc.".
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ARTICLE III - SUBLICENCES
3.1 - Sublicenses
3. 1. 1 - So long as this Agreement remains in full force and
effect and the Licensee has complied with all the provisions of
this Agreement, the Licensee may permit and sublicense others to
use the Licensed Technology disclosed to the Licensee by the
Grantor pursuant to the terms and subject to the conditions of
this Agreement, including, without limiting the generality of the
foregoing, the payment to the Licensor of the Royalties described
in Article VIII herein.
3.1.2 - The Licensee covenants with the Grantor to make the
Royalty payments to the Grantor by reason of sales by sublicensees
and for the observance and performance by all sublicensees of all
the provisions of this Agreement.
ARTICLE IV - TERM
4.1 - Term of Agreement
4. 1. 1 Subject to the provisions for early termination as set out
in this agreement, this agreement shall remain in full force and
effect for a period of five (5) years and shall expire five (5)
years from the date of this Agreement.
4.1.2 Options for two (2) extended terms: The Licensee is granted
two (2) successive options to extend the term of this Agreement
for a period of time not exceeding five (5) years in each such
option, each extended term to begin upon the expiration of the
term of this Agreement or of this Agreement as extended and all
the terms, covenants and provisions of this Agreement shall apply
to each extended term with the exception, however, that the
Licensee shall not have any further option to extend further the
term of this Agreement following the exercise, if any of the
second (2nd) option to extend. The options may be exercised by
Licensee by giving 120 days' notice in writing to the Grantor
prior to the expiration of the term or of the renewed term, and
the notice shall state the date to which the Licensee elects to
extend the Agreement.
ARTICLE V - IMPROVEMENTS TO LICENSED TECHNOLOGY
5.1 - Improvements
5. 1. 1 Disclosure: Save and except for the formula for the
adhesives, each party agrees to promptly disclose to the other any
and all technical data and information relating to any and all
developments or improvements of the Patents or the Products
(whether or not patentable) and of the Know-How that it may
develop or acquire during the term of this agreement to the extent
that such disclosure is not restricted or prohibited by law, by
any undertaking given to, or any condition, restriction or
restraint imposed by third parties, or by considerations relating
to the validity of any Patent in respect of which application is
about to be made.
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5.1.2 - Information from Third Parties: Where technical data and
information relating to any developments or improvements of the
Products is legally obtained or obtainable from an unrelated party
only upon payment, there shall be no obligation on either party to
make such payment in order to obtain such technical data and
information for disclosure to the other party provided, however,
that if the party does make such payment, such technical data and
information shall be disclosed to the other party.
ARTICLE VI - OBLIGATIONS, WARRANTIES
AND COVENANTS OF THE GRANTOR
6.1 - Obligations of the Grantor
6. 1. 1 Sale of Adhesives to the Licensee: Subject to the terms
and conditions of this Agreement, the Grantor agrees to sell (or
cause to be sold) to the Licensee all Adhesives used by the
Licensee in connection the with the Licensed Technology. The cost
of the adhesives to the Licensee will initially be twelve dollars
($12.00 - base year 1995) Cdn\kg. dry matter, FOB Moncton, New
Brunswick, Canada. A letter of credit shall be required from the
Licensee for the sale of all Adhesives to the Licensee. The
parties further agree that the twelve ($12-00) dollar cost for
adhesives shall be adjusted for each full year subsequent to the
date of this Agreement by the All Items Consumer Price Index (CPI)
for Canada as published by Statistics Canada or any successor
thereto. Each subsequent adjustment will be made on the previously
adjusted portion. In the event that the Adhesives sold or caused
to be sold by the Grantor to the Licensee hereunder are, after
inspection and examination upon arrival, not reasonably fit for
the purpose which they were purchased and are found not to be of
merchantable quality, the Licensee may, at its sole option, reject
the defective shipment of Adhesives and return them to the Grantor
for replacement or reimbursement.
6.1.2 - Marketing Information: The Grantor shall provide to the
Licensee sample marketing information and standard information
such as installation instructions, technical data and manuals as
are necessary to promote the sale of the Products, and including
trade advertisements and promotional literature, if requested by
the Licensee. The Licensee shall obtain the prior written approval
of the Grantor to use any such information which is not simply a
translation or copy of that provided by the Grantor. The Licensee
shall provide a translation in English of such promotional
material at the time of applying for such approval.
6.1.3 - Supply Technical Assistance:
(a) The Grantor agrees to use its best efforts to provide
the Licensee with technical
assistance under this Agreement. The Grantor does not assume any
responsibility
for any Products produced and sold by the Licensee in the
Territory.
(b) Upon the written request of the Licensee the Grantor
shall render all Know-How,
training and technical assistance necessary to be provided by the
Grantor under this agreement at times and places mutually agreed
upon and subject to the availability of the Grantor's personnel
and facilities. The Grantor does not warrant or agree that any of
its personnel to be furnished or to be made available to the
Licensee under this agreement will speak any language other than
English.
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The Licensee shall obtain any and all necessary visas, work
permits, residence permits or other permits or approvals necessary
for the entry into and working in the Territory of all technical
personnel who are to be provided by the Grantor under the terms of
this agreement.
6.1.4 - Quality Assurance Program: The Grantor and Licensee shall
work together jointly to establish a quality assurance program to
implement standards to ensure that the Adhesives are of a high
quality and shall meet or exceed all health and market
requirements in the Territory
6.1.5 - Supply Personnel: Upon the written request of the Licensee
during the term of this agreement, the Grantor agrees to send at
such reasonable intervals and times as may be mutually acceptable
to the Grantor and the Licensee at least one of the Grantor's
technical personnel and such additional technical personnel as may
be mutually agreed upon between the parties, to the Licensee's
plant in the Territory. The Grantor's employee or employees shall
render to the Licensee for a period of not more than five (5)
weeks during any calendar year such technical assistance as may be
reasonably necessary to produce Products of a quality at least
equal to those being produced by the Grantor. Such assistance
shall include the training of a reasonable number of the
Licensee's personnel. The Licensee shall reimburse the Grantor for
the costs with respect to any employees sent to and maintained in
the Territory under this paragraph. Such reimbursement shall be
made by the Licensee in Canadian currency and shall be in the
amount of the total of the following:
(a) the expenses of the personnel in traveling to and from
Territory; and
(b) the ordinary living expenses of the personnel while in
the Territory.
The Licensee further agrees to advance to the Grantor the cost of
one or more round-trip air fares, as the case may be, from the
Territory simultaneously with its request for such technical
personnel. The Licensee further agrees to reimburse the Grantor
for the aforementioned costs and expenses within thirty days
following receipt of the Grantor's invoice therefor after
deduction of the air fare referred to above. The Grantor does not
warrant or agree that any of its personnel to be furnished or to
be made available to the Licensee under this agreement will speak
any language other than English.
6.1.6 - File Patent Applications: The Grantor agrees at its sole
cost and expense to file with the appropriate European
Governmental authority within forty-five (45) days from the date
of execution of this Agreement, a PCT Patent Application with
respect to the Canadian Patent Application entitled "Method and
Material For Extending The Shelf-Life of Fresh Foods" filed
November 9th, 1994, as number 2135416 a copy of which is attached
hereto as Schedule "A" in those countries within the European
Patent Group plus Finland, Norway and Hungary, all of which are
designated and more particularly described and underlined in red
in Schedule "C" attached hereto.
6.1.7 - The Grantor may purchase production equipment from
Licensee at cost price for resale outside of the Licensee's
Territory. The Grantor will pay Licensee forty-five (45 %) percent
of its net profit from the sale of production equipment
manufactured by the Licensee and resold by the Grantor outside of
the Licensee's Territory.
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6.1.8 - In the event that the Grantor elects to sell common shares
of the Grantor, the Grantor grants to the Licensee the right of
first refusal to purchase such shares, provided however that such
right of first refusal shall not apply to any public share
offering or any share transactions between the shareholders of the
Grantor and which occur as a result of the Grantor's unanimous
shareholders agreement.
6.1.9 - If the Grantor receives a bona fide offer in writing (in
this clause called the "Outside Offer") from a third party to
purchase or otherwise acquire the Licensed Technology and the
Grantor wishes to accept the Outside Offer, the Grantor shall,
before accepting it, deliver a duplicate of the Outside Offer to
the Licensee and at the same time offer in writing (in this clause
called the "Grantor Offer") to sell the Licensed Technology to the
Licensee at the same price and upon the same terms and conditions
as are contained in the Outside Offer. Thereafter the Licensee
shall have thirty (30) days from the date of receiving the Grantor
Offer within which to accept it. If the Licensee does not accept
the Grantor offer within the thirty (30) day period the Licensee
shall be deemed to have rejected the Grantor Offer and the Grantor
shall be at liberty for a period of one hundred and twenty (120)
days after such rejection, to sell or otherwise part with the
ownership of the Licensed Technology to the third party at the
price and on the terms and conditions set out in the Outside
Offer. If no such sale pursuant to the Outside Offer occurs within
the one hundred and twenty (120) day period following the
rejection of the Grantor Offer, the foregoing provisions of this
clause shall apply again to any proposed sale or parting of
ownership of the Licensed Technology. Notwithstanding the
foregoing, no sale or other disposal of the Licensed Technology to
a third party shall be effective until the third party has agreed
in writing to be bound by and observe the terms of this Agreement.
6. 1. 10 - The Grantor shall assist the Licensee to incorporate
Transform Pack Europe Inc.
Austria by providing the Licensee with a notarized signed consent
under the seal of the Grantor permitting the Licensee to use the
corporate name "Transform Pack Europe Inc. " or such other similar
name as the governmental authorities in Austria may approve and
accept. Furthermore, the Grantor shall provide reasonable
assistance to the Licensee to ensure that the consent document is
duly officialized by the nearest office of the Austrian Consulat
in Canada.
6.2 - Warranties and Covenants of the Grantor
6.2.1 - The Grantor represents, warrants and, subject to the terms
and conditions of this Agreement, covenants as follows:
(a) It is a corporation duly incorporated and organized and
validly subsisting under
the laws of the Province of New Brunswick and has the corporate
power to enter
into this Agreement and to perform its obligations hereunder;
(b) This Agreement has been duly authorized, executed and
delivered by it and is a
legal, valid and binding obligation of the Grantor, enforceable
against it by the
Licensee in accordance with its terms;
(c) The execution and delivery of this Agreement by it and
the consummation of the
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obligations and events herein provided for will not result in the
breach or violation of any provision of, or constitute a default
under, or conflict with or cause the acceleration of any
obligation of the Grantor under any contract to which it is a
party or by which is bound, any provision of the constating
documents or by-laws or resolutions of the board of directors or
shareholders of
the Grantor, any judgment, decree, order or award of any court,
governmental body or arbitrator having jurisdiction over the
Grantor, any license, permit, approval, consent or authorization
held by the Grantor or any applicable law, statue, ordinance,
regulation or rule.
(d) The Grantor warrants that there are no other existing
licenses under the Know-How in the Territory and covenants that no
further disclosure to third parties will be made by it of the Know-
How in the Territory while this Agreement is in force.
(e) The Grantor warrants that it is the sole owner of the
Licensed Technology, including the Know-How and the Canadian
Patent Application entitled "Method and Material For Extending The
Shelf-Life of Fresh Foods" filed November 9, 1994, as number
2135416, a copy of which is attached hereto as Schedule "A" and
being more generally described in the Marketing Brochure attached
hereto as Schedule "B".
(f) The Grantor warrants that it shall within forty-five
(45) days from the date of execution of this Agreement file at its
sole cost and expense, the PCT Patent Application with the
appropriate European Governmental authority pursuant to the
provisions of article 6.1.5 of this Agreement.
ARTICLE VII - OBLIGATIONS, WARRANTIES
AND COVENANTS OF THE LICENSEE
7.1 - Obligations of the Licensee
7. 1. 1 - The Parties hereto agree that the Grantor will retain
two (2 %) of the shares of the Licensee and have a seat (Beirat)
on the Licensee's board of directors.
7.1.2 - The Licensee shall pay the Grantor forty-five percent (45
%) of its net profit from nonrefundable advanced payments received
by Licensee from sub-licensees and from the sale of equipment in
the Territory.
7.1.3 Promote Sales: The Licensee shall use its best efforts to
promote the sales of the Products in the Territory, and conduct
its business in a manner so as to enhance the reputation of the
Products, Know-How and Trade Marks.
7.1.4 Manufacture to Quality: The Licensee shall use its best
efforts within 210 days from the date of this Agreement to
diligently manufacture the Products with the highest standards
having regard to the nature of the Products and the use to which
they are to be put. The Licensee and the Grantor ' shall work
together jointly to establish a quality assurance program to
implement standards to ensure that the Adhesives are of a high
quality and shall meet or exceed all health and market
requirements in the Territory.
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7.1.5 Design and Manufacture Equipment: Within 180 days from the
date of this Agreement, the Licensee shall use its best efforts to
diligently design, develop and manufacture equipment to produce
the Licensed Technology. Within 90 days after disclosure by the
Grantor of all Know-How pursuant to article 2.1.2 of this
Agreement, the Licensee shall provide the Grantor with an action
plan with respect to the design, development and production of the
equipment pursuant to this-article which action plan shall become
attached hereto as a Schedule "G".
7.1.6 Purchase Adhesives From the Grantor: The Licensee shall
purchase from the Grantor all Adhesives used in connection with
the Licensed Technology. The cost of the adhesives to the Licensee
will initially be twelve dollars ($12.00 - base year 1995) Cdn\kg.
dry matter, FOB Moncton, New Brunswick, Canada. A letter of credit
shall be required for the purchase of all adhesives. The parties
further agree that the twelve ($12.00) dollar cost for adhesives
shall be adjusted for each full year subsequent to the date of
this Agreement by the All Items Consumer Price Index (cpr) for
Canada as published by Statistics Canada or any successor thereto.
Each subsequent adjustment will be made on the previously adjusted
portion. PROVEDED HOWEVER, in the event that the Adhesives
purchased by the Licensee hereunder are, after inspection and
examination upon arrival, not reasonably fit for the purpose which
they were purchased and are found not to be of merchantable
quality, the Licensee may, at its sole option, reject the
defective shipment of Adhesives and return them to the Grantor for
replacement or reimbursement.
7.1.7 Supply Sample Products: The Licensee further agrees to
supply by air express to the Grantor a sample of the Products at
least once every quarter during the course of this Agreement and
the Grantor agrees to utilize its laboratory services to analyze
sample and to render promptly, by air mail, telephone or telex or
telecopy, at the Grantor's discretion, a report to the Licensee
concerning the quality and shelf life of the Products, in order to
maintain continuous production of Products of uniformly high
quality.
7.1.8 Promotion and Advertising: The Licensee agrees diligently to
promote the sale of the Products under this Agreement.
7.1.9 Compliance with Local Laws: The Licensee shall ensure that
any registration or notification required by the laws of the
Territory shall have been carried out. The Licensee shall comply
with all laws and regulations as may apply with the Territory, as
applicable to this agreement and all transactions and activities
contemplated or to be performed under this agreement.
7. 1. 10 Location of Production Facilities: The Licensee must keep
the Grantor informed of the locations of its production facilities
in a timely manner.
7. 1. 11 Name of Corporation: The Licensee must use a corporate
name in the Territory which includes the words "Transform Pack" or
such other corporate name as may be approved.
7.1.12 Insurance: The Licensee shall be responsible for adequate
insurance coverage relating to the use of the Licensed Technology
by the Licensee in the Territory, if same may be required by the
Licensee.
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7.1.13 Taxes and Approvals: The Licensee shall be responsible for
all excise and import taxes, as well as all regulatory approvals
from appropriate governmental agencies in the Territory.
7.1.14 In the event that the Licensed Technology and/or Products
fail to fulfill the Needs Of The Market throughout the Territory
despite the due diligence, sincere effort and business
professionalism of the Licensee in promoting the sales and
marketing of the Products and the Territory, then the Licensee
may, at its option, suspend this Agreement for a period not
exceeding one (1) year in order to work jointly together with the
Grantor to make such changes and improvements to the Licensed
Technology and Products as are necessary to fulfill the Needs of
the Markets in the Territory. After the expiration of one (1) year
from the date of initial suspension, if the Needs of the Markets
have still not been met, the parties hereto covenant and agree
with each other that, if reasonable grounds for a further
extension are established, they shall suspend this Agreement for a
further period of* time as may be reasonable under the
circumstances to fulfill the Needs of the Markets in the
Territory. The Licensee shall keep the Grantor fully apprised of
all matters relating to the Needs of the Markets in the Territory.
If the parties hereto cannot agree either on the granting of a
further extension or the length of such extension to be granted,
then either party hereto may resort to the Dispute Resolution
provision set out in this Agreement under Article XVI.
7.2 Warranties and Covenants of the Licensee
7.2.1 - The Licensee represents, warrants and, subject to the
terms and conditions of this Agreement, covenants as follows:
(a) This Agreement has been duly authorized, executed and
delivered by it and is a
legal, valid and binding obligation of the Licensee, enforceable
against it by the Grantor in accordance with its terms;
(b) The execution and delivery of this Agreement by it and
the consummation of the
obligations and events herein provided for will not result in the
breach or violation of any provision of, or constitute a default
under, or conflict with or cause the acceleration of any
obligation of the Licensee under any contract to which it is a
party or by which is bound, any provision of the constating
documents or by-laws or resolutions of tile board of directors or
shareholders of the Licensee, any judgment, decree, order or award
of any court, governmental body or arbitrator having jurisdiction
over the Licensee, any license, permit, approval, consent or
authorization held by the Grantor or any applicable law, statute,
ordinance, regulation or rule.
(c) The Licensee shall, in accordance with the provisions
herein, incorporate a legal
entity in Austria within 30 days from the date of this Agreement
or such further or additional time as the governmental authorities
require under the name "Transform Pack Europe Inc. " or such
similar corporate name as may be approved. Furthermore, upon
incorporation of Transform Pack Europe Inc., the company shall
ratify this License Agreement and the authority of Xxxxx X.
Xxxxxxxxxx to negotiate same on its behalf.
(d) Advertising: The Licensee covenants that he shall not
advertise the Products
outside the Territory except where advertisements are included in
international publications.
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(e)Remain in Territory: The Licensee covenants that he shall not
seek customers, establish any branch or maintain any office or
depot in relation to the Products anywhere outside the Territory.
(f) The Licensee covenants to make the Royalty payments to
the Grantor by reason
of sales by sublicensees and for the observance and performance by
all sublicensees of all the provisions of this Agreement.
ARTICLE VIII - ROYALTY PAYMENTS
8.1 Royalty Payments
8. 1. 1 Royalties: As consideration for the license granted under
the licensed Patents, Know-How and licensed Trade Marks, the
Licensee agrees to pay the Grantor during the term of this
Agreement an ongoing royalty equal to ten (10%) percent of the
Gross Revenues as the term is defined in section l(b) of this
Agreement (the "Royalties"). Such Royalties shall be payable as
set out on c~, to the branch and account designated by the
Grantor.
8.1.2 Payment Period: Within thirty days of the end of each
quarter in each year, the Licensee shall deliver to the Grantor a
report setting out the numbers, description (including description
of end use) and value of the sales of each Product manufactured by
or on behalf of the Licensee and sold by it (whether separately or
as part of any larger unit or product) during such preceding
quarter. Concurrently with the making of each such report, the
Licensee shall remit the Royalties then due to the Grantor in
respect of the Products sold by or on behalf of the Licensee in
the preceding quarter.
8.1.3 Estimated Minimum Royalties: The Licensee estimates minimum
royalty payments to the Grantor of approximately the following
amounts pursuant to the terms of this Agreement:
(a) First year of Agreement - $150,000.00
(b) Second year of Agreement - $150,000.00
(c) Third year of Agreement - $200,000.00
(d) Fourth year of Agreement - $300,000.00
(e) Fifth year of Agreement - $500,000.00
IT IS HEREBY AGREED TO BY THE PARTIES THAT the Licensee shall
prepay a non-reimbursable Royalty for the first year to the
Grantor in the amount of One Hundred and Fifty Thousand Dollars
($150,000.00), payable in Canadian dollars to the Grantors in the
following installments: $50,000.00 within 90 days of signing this
agreement; another $50,000.00 within 210 days of the signing of
this Agreement; and the balance within 1 year of the signing of
this Agreement.
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8.1.4 Promissory Note: The estimated minimum payment to the
Grantor in the first year will be guaranteed by a Promissory Note
issued by Transform Pack Europe Inc. in the amount of $150,000.00
a copy of which is attached hereto as Schedule "F". Upon
incorporation, Transform Pack Europe Inc. covenants and agrees to
execute the Promissory Note attached hereto as Schedule "F".
8.1.5 Samples: No Royalties shall be payable in respect of
Products sold or otherwise disposed of by the Licensee for the
purpose of samples or bona fide tests on such Products.
8.1.6 No Deductions for Tax: All payments to the Grantor under
this agreement shall be made without any deduction of any kind
except for withholding taxes, if any, exigible on the payments.
The Licensee undertakes to take all reasonable steps to assist the
Grantor to obtain the benefit of any double taxation agreement
which may apply to any of the payments under this agreement and to
minimize the impact of any taxation in respect of such payments.
8.1.7 Withholding Taxes: In the event that withholding taxes are
exigible on any payments under this agreement, the Licensee shall
withhold the withholding taxes required and shall promptly remit
such taxes to the appropriate taxing authority in the Territory.
Upon any such remittance, the Licensee shall promptly provide the
Grantor with documentation evidencing the payment of such taxes,
and any other documentation that the Grantor shall reasonably
require so as to obtain a foreign tax credit in Canada.
8.1.8 Canadian dollars: Except as otherwise specified in this
agreement, all payments required to be made by or on behalf of the
Licensee under this agreement shall be paid in Canadian dollars.
ARTICLE IX - INDEMNIFICATION
9.1. Indemnity for Patent and Trade Xxxx Actions
9. 1. 1 Modified Products: The Grantor shall have no obligation to
defend the Licensee or to pay costs, damages or legal fees for any
claim based on any modifications made to the Products by the
Licensee.
9.1.2 Invalidity. of Patents or Trade Marks: In the event that any
of the Patents, Know-How or Trade Marks, present or future, being
the subject of this Agreement shall be held invalid in any
infringement or impeachment proceedings in the Territory, the
Licensee shall have the option of paying the royalties into a
separate trust account of the Giro Credit Bank, Main Branch at
Graz, Austria, Europe, until a final determination of validity has
been made by a court of competent jurisdiction from which either
no appeal has been or can be taken. If the finding of the court is
that any claim or the claims of the Patents, Know-How or Trade
Marks which are licensed is valid, then the moneys paid in escrow,
including all accumulated interest, shall be paid out to the
Grantor. If the finding of the court is that all claims of the
Patents, Know-How or Trade Xxxx which is licensed are invalid, the
moneys in escrow shall be paid out to the Licensee and this
agreement shall automatically then terminate.
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ARTICLE X - REGISTRATION AND MAINTENANCE OF PATENTS
10. 1 - Registration and Maintenance of Patents
10. 1. 1 If any Patents are issued in the Territory, the Licensee
shall be responsible for maintaining and keeping the Patents in
the Territory in full force and effect throughout the term of this
Agreement. At the request of the Licensee, the Licensor shall
register the Licensee as a registered user of the Patents in the
Territory. Further, the Grantor agrees to obtain any registration
or any approvals or authorizations in connection with this license
and its supplementary agreements that, in the opinion of the
Licensee, may be necessary or desirable to be obtained from any
government or governmental agency or instrumentality in the
Territory and the obtaining thereof shall be a condition to this
entire Agreement. Provided however, that all costs incurred by the
Licensee in maintaining said registrations shall be deductible by
the Licensee from royalty payments due to the Grantor under the
terms of this Agreement, provided however that the Licensee has
sold Products in the particular registration district during the
year in question which the maintenance and registration costs are
sought to be deducted.
ARTICLE XI - TRADE MARKS
11.1 - Trade Marks and Other Proprietary Marks
11. 1. 1 Description as Authorized Licensee: The Licensee is
authorized, but not obligated to f
describe, refer to and advertise itself as a licensee of the
Grantor for the manufacture of the
Products in the Territory.
11.1.2 The Licensee agrees that its right to use the trade name
and trade xxxx shall be
conditional upon its selling only Products of a quality equal to
those being produced at any given
time by the Grantor, or at the Grantor's discretion, in accordance
with the reasonable standards
of quality specified from time to time by the Grantor.
11. 1. 3 Application for Registration of Trade Marks: In the event
that the Grantor decides to
apply for registration of any one or more of the Trade Marks in
connection with the Products
in the Territory, the Grantor shall notify the Licensee in writing
and may request and obtain the
Licensees advice and assistance if required, and keep the Licensee
informed of pertinent
developments and/or the issuance of registration. The cost of any
such registration of trade
marks shall be for the account of the Grantor and all such
registrations shall be applied for and
issue in the name of and as the sole property rights of the
Grantor.
11. 1. 4 New Trade Marks: If any Trade Marks of the Grantor are
used by the Licensee, alone
or in combination with other trade marks of the Grantor or the
Licensee, in such manner as to
be distinctive by reason of design, colour, format or any other
reason, such distinctive features
and associated good will shall become the property of and enure to
the benefit of the Grantor,
and the Licensee agrees that it will, without any payment or other
consideration, sign and
execute such documents as are necessary to transfer and assign all
rights thereto to the Grantor.
11. 1. 5 Transfer to Grantor: Should the law or regulations of any
part of the Territory invest the
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Licensee with any property rights to any of the Trade Marks, the
Licensee shall promptly, freely
and co-operatively relinquish to the Grantor any and all such
rights upon termination of this
agreement for any reason, without recourse or cost to the Grantor
and shall thereafter refrain
from any further usage of the said Trade Marks.
11. 1. 6 Cease Using on Termination: Following termination of this
agreement for any reason
whatsoever, the Licensee agrees not to register or use any of the
Trade Marks, or any trade
marks or trade names which are the same as or confusingly similar
to the Trade Marks. This
obligation shall survive the termination of this Agreement.
ARTICLE XII - CONFIDENTIALITY
12.1 - Confidentiality
12. 1. 1 Confidential Information: All information, other than
information generally known in the food and hospitality industry
or information made known by a third party to the Licensee other
than a consequence of the Licensee's relationship with the Grantor
("Confidential Information") supplied by or on behalf of the
Grantor pursuant to this Agreement shall be treated as
confidential by the Licensee and shall be used solely to enable
the Licensee to manufacture, use, sell and develop a market for
the Products in accordance with this Agreement, and all documents
containing or disclosing such Confidential Information shall at
all times be and remain the property of the Grantor; provided,
however, that the Grantor shall not during the continuance of this
Agreement demand the delivery of such documents from the Licensee.
12.1.2 Permitted Disclosure: Nothing contained in this Agreement
shall prevent the Grantor or the Licensee from making disclosure
of any of the Confidential Information to:
(a) any authorized body for the sole purpose of maintaining
registration of any Patent for any invention or discovery which is
the subject of this agreement; or
(b) any other person, firm or corporation for the purpose of
promoting the sale or use
of Products by the Grantor and any of its other licensees or by
the Licensee and any of its permitted sub-licencees, provided that
the Licensee shall obtain from the persons to whom such disclosure
is made a covenant of non-disclosure in favour of both the Grantor
and the Licensee.
ARTICLE XIII - BOOKS AND RECORDS
13.1 - Books and Records
13. 1. 1 Duty to Keep Records: The Licensee shall keep at its
principal place of business clear, accurate and comprehensive
records showing, in particular, all sales in the Territory of the
Products manufactured by or on behalf of the Licensee in
sufficient detail to enable the payments due under this agreement
to be correctly ascertained. The Licensee shall adhere to
accounting standards equal to or better than generally accepted
accounting principals established by the chartered accounting
profession in Canada.
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13.1.2 Audit Discrepancy: The Grantor shall be entitled to appoint
an auditor or accountant to audit the records for the production
and sales of the Product, and the Licensee shall give access to
such records and supporting documentation and otherwise reasonably
assist in such audit so that the Grantor may obtain independent
verification of the written statements referred to above, such
audit to be made at the expense of the Grantor. However, in the
event that such audit reveals an error in favour of the Licensee
in excess of five (5 %) percent of the amount stated in the
production statements for the year in question, then, the Licensee
shall be responsible to pay for the full cost of the audit.
ARTICLE XIV - FORCE MAJEURE
14.1 Excusable Delay
14. 1. 1 Upon the occurrence of any excusable delay, the party
experiencing such occurrence shall promptly notify the other party
of the occurrence and estimate the duration of said occurrence.
Thereupon, the time within which the party experiencing such
occurrence shall have to perform its obligations under this
agreement shall, to the extent necessitated by such occurrence and
for the duration of such occurrence, be appropriately delayed.
In case of force majeure preventing or hindering either party from
performing its obligations under this agreement, the affected
party may give written notice to the other containing reasonable
particulars of the force majeure in question and the effect of
such force majeure as it relates to the obligations of the
affected party and such force majeure shall not constitute a
default under this agreement, provided that the party affected by
the delay makes reasonable efforts to correct the reason for such
delay. Such notice shall entitle the affected party to suspend
deliveries or payments, as the case may be. For the purpose of
this agreement, 'force majeure" shall mean any of the following
events beyond the control of the parties:
(a) lightning, storms, earthquakes, landslides, floods,
washouts and other acts of God;
(b) substantial or material fires, explosions, breakage of
or accidents to plant, machinery, equipment and storage
of the supplier;
(c) strikes, lockouts or other industrial disturbances of
the supplier;
(d) civil disturbances, sabotage, war, blockades,
insurrections, vandalism, riots, epidemics;
(e) inability to obtain supplies necessary to manufacture
and package the Products at the supplier's plants, if
inability is industry-wide among similar manufacturers
or inability to obtain electric power, water, fuel or
other utilities, or services necessary to operate the
plants; and
(f) any other material event that could reasonably be
considered to be force majeure by reason that it is
beyond the control of the party affected;
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but shall not include the inability of either party to
obtain financing or any other financial inability on the
part of either party.
ARTICLE XV - TERMINATION
15.1 - Termination on Notice
15. 1. 1 Either party may terminate this agreement if,
(a) the other party is in default in any material respect in
the performance of any of its obligations under this agreement or
otherwise commits any material breach of this agreement, and such
default continues after sixty (60) days' written notice sent by
first class postage prepaid registered mail from the non-
defaulting party to the defaulting party stating the particulars
of such default (for the purposes herein, any failure to make any
payment due under this agreement shall be a material default);
(b) bankruptcy or insolvency proceedings are instituted by
or against the other party, which the other party does not defend
or which it is not successful in defending, or the other party is
adjudicated a bankrupt, becomes insolvent, makes an assignment for
the benefit of creditors or proposes or makes any arrangements for
the liquidation of its debts or a receiver or receiver and manager
is appointed with respect to all or any part of the assets of the
other party;
15.2 - Events Upon Termination
15.2.1 Upon termination of this agreement for any cause
whatsoever,
(a) all Royalties, including Royalties on the Products then on
hand or in the course of manufacture, shall immediately become due
and payable;
(b) the Licensee shall forthwith, and not later than ninety (90)
days thereafter, return free of any charge to the Grantor, all
written information of whatever kind, including graphic and
electronically or magnetically recorded documents furnished by the
Grantor or created by the Licensee in relation to the Products
including, without limitation, notes, memoranda, diaries, records,
drawings, prints, sketches, plans, specifications and other
technical information made by the Licensee or its agents,
affiliates or employees and copies of any kind made thereof by
anybody, and derived from the technology of the Patents, Know-How,
Trade Marks, Products or the manufacture thereof; further, the
Licensee agrees that it will forthwith discontinue the use of and
refrain from using, disclosing or exploiting the Know-How and any
technical data and information pertaining thereto or any
improvement or development in respect thereof disclosed to it
under this agreement by the Grantor and from manufacturing or
selling the Products and the Grantor shall forthwith-have the
right to institute proceedings for infringement of any of its
Patent and Trade Xxxx rights then in force;
15.2.2 Notwithstanding any such termination:
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(a) all warranties and covenants set out in this agreement and
all obligations of indemnification shall survive and continue to
bind the parties for three (3) years after the date of termination
of this Agreement;
(b) the Licensee shall honour any remaining payment obligations
set out in this Agreement; and
(c) the Licensee shall be permitted to sell all Products
manufactured prior to the termination, provided such sales are
completed by delivery of goods and receipt of payment therefor
within six (6) months of the date of such termination and are
subject to the payment obligations as set out in this Agreement.
ARTICLE XVI - GENERAL PROVISIONS
16.1 - Dispute Resolution
All disputes arising in connection with the present contract shall
be finally settled under the Rules of Conciliation and Arbitration
of the International Chamber of Commerce by three arbitrators.
Each party shall appoint an arbitrator, and the two thus selected
to designate a third. If either of the parties fails to appoint
its arbitrator within sixty days after receipt of notice of the
appointment by the other of its arbitrator, or if the arbitrators
fail to appoint a third, then the President of the International
Chamber of Commerce, Paris, France, shall have the power on the
request of either party, to make the appointments which have not
been made as contemplated above. The arbitration shall be held as
promptly as possible at such time and place as the arbitrators may
determine. The decision of a majority of the arbitrators shall be
final and binding on the parties, and the expense of the
arbitration shall be paid as the arbitrators may determine.
16.2 - Assignment
16.2.1 The Grantor acknowledged that the Licensee may assign this
Agreement to an Affiliate or subsidiary and the assignee shall
continue to be bound by the terms and conditions of this
Agreement. The Licensee acknowledges that the Grantor may assign
this agreement to an Affiliate or subsidiary and the assignee
shall continue to be bound by the terms and conditions of this
Agreement.
16.3 - Language
16.3.1 Upon execution, this agreement may be translated into the
language of the Territory provided, however, that in the event of
any diversion between the English version and any other version,
the English version shall prevail.
16.4 - Extended Meanings
16.4.1 Words importing the singular number include the plural and
vice versa and words importing gender include all genders.
16.5 - Applicable Law
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16.5.1 This agreement shall be deemed to have been made, executed
and delivered in Moncton, New Brunswick, Canada, and any
controversy arising under or in relation to this agreement shall
be governed by and construed in accordance with the laws of the
Province of New Brunswick, Canada.
16.6 - Entire Agreement
16.6.1 This agreement constitutes the entire agreement of all the
parties with respect to the subject-matter hereof and, except as
stated in this agreement and in the instruments and documents to
be executed and delivered pursuant to it, contains all of the
representations, undertakings and agreements of all parties
respecting the subject-matter hereof. There are no
representations, undertakings or agreements of any kind between
all the parties respecting the subject-matter hereof except those
contained in this agreement.
16.7 - Severability
The invalidity or unenforceability of any provision of this
agreement shall not affect the validity or enforceability of any
other provision.
16.8. Currency
16.8.1 Unless otherwise specifically provided in this
agreement, all references to dollar
amounts or other money amount are expressed in terms of lawful
money of Canada.
16.9 - Notices
16.9. 1 Any notice or other documents required or permitted to be
given under this agreement shall be in writing and shall be
delivered, mailed by pre-paid registered mail, return receipt
requested or sent by telex or telecopy addressed to the party or
parties to whom it is to be given at the address shown below or at
such other address or addresses as the party or parties to whom
such writing or document is to be given shall have last notified
all other parties in accordance with the provisions of this
paragraph:
(a) if to the Licensee at Xxxxxxxxxxxxx 00, Suite 41, A-8010,
Graz, Austria, Europe
(b) if to the Grantor at 000 Xxxxxxx Xxxxx, Xxxxxxx, Xxx
Xxxxxxxxx, Xxxxxx, EIA 4Y2
16.9.2 Any such notice or other document shall:
(a) if delivered, be deemed to have been given and received at
the place of receipt on the date of delivery, provided that if
such date is a day other than a business day in the place of
receipt, such notice or document shall be deemed to have been
given and received at the place of receipt on the first business
day in the place of receipt, thereafter;
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(b) if transmitted by telex or telecopy, be deemed to have been
given and received at the place of receipt on the next business
day in the place of receipt, following the day of sending; and
(c) if mailed, be deemed to have been given and received at the
place of receipt on the date of actual receipt.
16.9.3 In the event of postal disruption, such notices or
documents must either be delivered personally or sent by telex or
telecopy.
16.10 - Amendment of Agreement
16.10.1 None of the terms, conditions or provisions of this
agreement shall be held to have been changed, waived, varied,
modified or altered by any act or knowledge of either party, their
respective agents, servants or employees unless done so in writing
signed by both parties.
16.11 - Waiver of Breach
16.11.1 No waiver on behalf of any part of any breach of the
provisions shall be effective or binding on such party unless the
same shall be expressed in writing and any waiver so expressed
shall not limit or affect such party's rights with respect to any
future breach of any of the provisions of this agreement.
16.12 Successors and Assigns
16.12.1 This agreement shall be binding on and enure to the
benefit of the successors and permitted assigns( Affiliates) of
both parties and all persons or corporations succeeding to or
acquiring the business now carried on by the Grantor or the
Licensee.
16.13 - Time
16.13.1 When calculating the period of time within which or
following which any act is to be done or step taken the date which
is the reference day in calculating such period shall be excluded.
16.14 - Time of the Essence
16.14.1 Time shall be of the essence of this agreement.
ARTICLE XVII - FURTHER ASSURANCES
17.1 Further Assurances
17.1.1 - The Parties agree to cooperate with and assist each other
and take such further or additional action as may be reasonably
necessary to implement and carry into effect this Agreement to its
full extent.
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ARTICLE XIII - WAIVER
18.1 - Waiver
18.1.1 - The waiver of any breach of any term or-condition hereof
shall not be deemed a waiver of any other or subsequent breach,
whether of like or different nature. No failure to exercise and no
delay in exercising, on the part of either party hereto, any
right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any right,
power, or privilege hereunder preclude any other or further
exercise thereof or the exercise of any right, power or privilege.
The rights and remedies herein provided are accumulative and not
exclusive of any rights or remedies at law.
ARTICLE XIX - ESCROW OF LICENSED TECHNOLOGY
19.1 - All Licensed Technology to be held in Escrow
19. 1. 1 The Licensed Technology, including the Patents, Know-How
and Trade Secrets (including the formula of the adhesives and
marinating spices and flavours together with formulaes for same
and any modifications and improvements thereto) however documented
or recorded, including any report, software, photograph, drawing,
plan, operating data, specifications, recipe, model, prototype,
copyright, design, technical information, operation manual,
improvement, invention, method or process or other tangible or
intangible property ( the "Escrow Materials") shall be held by the
Research and Productivity Council (the "Escrow Agent"), in escrow
pursuant to the terms of this Agreement.
19.1.2 Improvements or additions to the Licensed Technology
(including the adhesives and marinating spices and flavours
together with formulaes for same) arising after the date of this
Agreement, including amendments to the Patents and any
modifications and improvements thereto) shall be added by the
Grantor to the Escrow Materials held by Escrow Agent and the
Licensee shall be promptly notified in writing of each such
addition. On reasonable notice to the Escrow Agent, the Licensee
may attend at the offices of Escrow Agent to inspect the Escrow
Materials save and except for the formulae of the Adhesives.
However, the Escrow Agent shall provide a written statement at the
request of the Licensee confirming that the Escrow Agent has in
its possession as part of the Escrow Materials the formulae for
the Adhesives.
19.1.3 Upon the failure of the Grantor to cure, after reasonable
notice requiring it to do so, any breach, violation, non-
performance or non-observance of article 6. 1. 1., the Licensee
shall have, in addition to any other rights or remedies it may
have against the Grantor under this Agreement ( which rights or
remedies are not limited hereby), the right to purchase from the
Escrow Agent all Adhesives used in connection with the Licensed
Technology. The cost of the Adhesives to the Licensee will be
twelve dollars ($12.00 base year 1995 ) Cdn\kg. dry matter, FOB
Fredericton, New Brunswick, Canada. A letter of credit shall be
required for the purchase of all Adhesives. The parties further
agree that the twelve ($12.00) dollar cost for Adhesives shall be
adjusted for each full year subsequent to the date of this
Agreement by the All Items Consumer Price Index (CPI) for Canada
as published by Statistics Canada or any successor thereto. Each
subsequent adjustment
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will be made on the previously adjusted portion. In the event that
the Adhesives purchased by the
Licensee hereunder are, after inspection and examination upon
arrival, not reasonably fit for the purpose which they were
purchased and are found not to be of merchantable quality, the
Licensee may, at its sole option, reject the defective shipment of
Adhesives and return them to the Escrow Agent for replacement or
reimbursement.
19.1.4 The parties agree to enter into an escrow arrangement with
the Escrow Agent consistent with the foregoing clauses of this
article, such escrow agreement to be entered into on or before
ninety (90) days from the date of this Agreement.
IN WITNESS WHEREOF the parties have duly executed this
agreement as of the date first above written.
SIGNED, SEALED AND DELIVERED
in the presence of TRANSFORM PACK INC.
Per: /s/ Xxxxxxx Xxxxxxx,
President
Per : /s/ Xxxx Xxxxx, Vice-
President
Per: Xxxxxxx Xxxxx, Vice-
President
/s/ XXXXX X. XXXXXXXXXX
(on behalf of a company
which is to
be incorporated)
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