EXHIBIT 4.19
Joint Venture Shareholders' Agreement
May 16, 1996
Between: York Medical Inc. ("YM"), a company incorporated under the laws of the
Province of Ontario, Canada, CBQYM Inc., a company incorporated under the laws
of Barbados ("CBQYM") and CIMAB S.A. ("CIMAB") a Cuban company incorporated
under the laws of the Republic of Cuba, representing Centro de Bioactivos
Quimicos of the Universidad Central de Las Villas ("CBQ").
RECITALS
Whereas:
o CIMAB entered into a licencing agreement with YM on behalf of CBQ, dated
May 3, 1995 (the "Licencing Agreement");
o CBQYM has been incorporated to serve as a joint venture company, owned as
to 80% of its common equity by YM and as to 20% by CIMAB. to market the
licenced products assigned to it by YM pursuant to the Licencing
Agreement;
o Certain of the benefits and obligations of the Licence Agreement have been
assigned to CBQYM by YM; and,
o The purpose of this agreement is to set out the relationship between the
parties hereto so that they will proceed on a mutually beneficial basis.
Now, therefore, for good and valuable consideration and the sum of one dollar
(Canadian funds) paid by each party to the other, receipt of which is hereby
acknowledged.
o CBQYM shall have an unlimited number of common shares, the initial issue
of which shall be as to 80% to YM and as to 20% to CIMAB.
o No issued and outstanding shares in the capital of CBQYM shall be sold,
transferred or otherwise disposed of to any person without the written
consent of each of YM and CIMAB.
o The issue of any additional common shares in the capital of CBQYM shall
first be to each of YM and CIMAB in proportion to their shareholdings, and
thereafter to any other person, but only with the consent of both of YM
and CIMAB, such consent not to be withheld unreasonably.
o The board of directors of CBQYM shall consist of nine directors, three of
whom shall be nominees of YM, two of whom shall be nominees of CIMAB and
four of whom shall be a resident of Barbados, nominated by YM. The initial
directors of CBQYM shall be as set out in Appendix A hereto. The election
of directors shall take place annually. The board is required to meet once
per year in the Barbados, and at least one other time per year at a
location to be agreed to among the directors or by telephone, and
otherwise as often as deemed necessary for the conduct of the business of
the joint venture in accordance with the Articles of Incorporation and the
by-law's of CBQYM. The by laws of CBQYM shall provide that a quorum for
meetings of the board of directors shall be a minimum of four directors
and must include one of each of the YM and CIMAB nominees, notice shall be
a minimum of 30 days prior to any meeting and meetings may be called at
any time by two directors.
o CBQYM shall use its best efforts to undertake and perform the terms of the
assigned Licence Agreement. In all events CBQYM shall operate solely
through YM in CBQYM's commercialization of products pursuant to the
Licence Agreement, any assignment thereof and regarding any future
licencing agreements.
o All material and out-of-the-ordinary-course of business contracts of
CBQYM, including contracts or agreements respecting the borrowing of
money, the issuance of guarantees, the entering into of non-arms-length
agreements, the lending of money to any persons related to CBQYM, the
approval of the strategic marketing plan, the approval of the annual
budget, the approval for acquisitions, dispositions and amalgamations and
the pledging of property are required to be approved by a majority of the
board of directors including the approval of at least one nominee of each
of YM and CIMAB. Such approval may be evidenced either by a resolution of
the board of directors of CBQYM or a written consent signed by the
required number of directors. Any and all other matters relating to the
business and affairs of CBQYM shall be governed by the Articles of
Incorporation and by-laws or, to the extent not provided in them, by a
majority of the directors of CBQYM evidenced as provided above.
o The parties agree that all of the earnings of CBQYM shall be distributed
annually as dividends to the shareholders. Any variation from this policy
must he approved by a vote of the majority of the directors, including
approval of all of the nominees of YM and CIMAB, respectively.
o The auditors of CBQYM shall be KPMG Peat Marwick. CBQYM's full and
accurate records of the net revenues shall be made available for
inspection by CIMAB.
In witness whereof, the parties hereto have executed this Agreement by duly
authorized officers or representatives thereof.
CIMAB S.A. YORK MEDICAL INC.
duly authorized to sign duly authorized to sign
CBQYM Inc.
duly authorized to sign
APPENDIX A
Initial Directors of CBQYM Inc.
Xxxx X. Xxxxxxxx
Xxxxx X. Xxxxxx
Xxxxxxxxxxx X. Xxxxxxxxx
Xxxx W. D'A Xxxxxx
Xxxx X. Xxxxx
Xxxxx X. Xxxxx
Xxxxxx X. Xxxxx
Dr. Ervello Xxxxxxxx Xxxxx
Ing. Xxxxxxxx Xxxxxx Xxxxx
