EXCLUSIVE MANUFACTURING
LICENSE AGREEMENT
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EFFECTIVE AS
JANUARY 2nd, 2005
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XL
Generation AG, a
company duly created and organized under the legislation of
Switzerland, having represented by Mr Alain Lemieux who declares
being authorized to sign the present document.
Hereinafter
referred to as the “Licensor”)
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POLYPROD INC., a company duly created under the Laws of Canada
, having represented by Mr. Domenico Malatesta who
declares being authorized to sign the present document;
(Hereinafter
referred to as the “Licensee”)
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A. Licensor
has been granted by WKF 5 Ltd, the right to sell, promote,
manufacture and commercialize including the right to grant licenses
under the letters patent and the patent applications (and any
patents that may issue there from) owned by WKF 5 Ltd. Said patents
and patent applications (all of which are collectively referred to
herein as the “Patents”);
B. Licensee
desires to obtain, and Licensor desires to grant, an exclusive
worldwide license to manufacture all the product that could be
covered from time to time by the Patents but limited to turf and
non turf sport surfaces including landscape and playground
surfaces.
NOW, THEREFORE,
in consideration of the foregoing, the agreements contained herein,
and other good and valuable consideration, receipt of which is
hereby acknowledged, the parties agree as follows:
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EXCLUSIVE MANUFACTURING
LICENSE
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The Licensor
hereby grants to Licensee, and Licensee hereby accepts from
Licensor, upon the terms and conditions specified herein, the
worldwide (hereinafter the “Territory”) exclusive right
and non-transferable license to manufacture, under license, the
inventions covered by the Patents but limited to turf and non turf
sport surfaces including landscape and playground surfaces.
Licensee agrees to use its best efforts and invest a reasonable and
fair amount in its Corporation to provide the necessary equipment
and human resources to manufacture the licensed products in the
Territory covered by this Agreement.
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The Licensee
agrees that the product will be manufactured according to the
specifications provided by the Licensor and will meet its quality
standards.
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The Licensee
recognizes that the Licensor is the licensee of the exclusive
worldwide right to manufacture, distribute, sell and promote the
products covered by the Patents and other Intellectual Properties.
The Licensee recognizes that all the purchase order will come from
XLGENERATION AG or designated person by XLGENERATION AG.
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The Licensee
agrees and undertakes not to sell, promote, distribute the Product
covered by the Patent rights (the right granted being exclusively
for manufacturing) except pursuant to this Agreement.
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WKF 5 Ltd. by
its representative, Alain Lemieux, intervenes to this Agreement to
accept and to be informed of this manufacturing license
agreement.
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XLGENERATION
hereby appoints and designates Polyprod as its exclusive worldwide
manufacturer of any XLGeneration’s products covered by the
Patents for turf and non turf sport surfaces including landscape
and playground products
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The Licensor
and the Licensee shall agree on a "modus operandi" regarding the
purchase order from XLGENERATION AG. The parties agree that for the
beginning of the execution of this agreement, Polyprod shall be on
a "Cost Plus" basis. The parties agree that in the 120 days
following the signature of this agreement, the Licensee shall
provide the costs and the mark up needed to perform its obligation.
The parties may postpone the delivery of this obligation by mutual
consent
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The Licensee
shall use its best effort to maintain its cost as low as possible
and shall work with XLGeneration, at XLGeneration’s option,
to implement a program of reducing the costs.
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Royalty . For the rights and privileges granted under
this license, Licensee will pay to Licensor during the term of this
Agreement and subject to the other terms and conditions of this
Agreement, a royalty of $1,00 per year
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Records . Licensee shall keep full, true and accurate
books of account containing all particulars which may be necessary
to show the amount of its costs for each purchase order. The
parties may agree on a different method to establish the cost or
may agree on a fixed amount. Such books of account shall be kept at
the Licensee's principal place of business. Such books and the
supporting data shall be open during normal business hours at
reasonable times for one year following the end of the calendar
year to which they pertain, to the inspection of an independent
certified public accountant retained by Licensor for the purpose of
verifying Licensee’s royalty statements, or Licensee’s
compliance in other respects with this license. Only one such
inspection shall be made in any calendar year.
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Reports : Payment of Product
manufactured . The payment of each purchase order shall be
made FOB Montreal at Polyprod’s site unless agreed otherwise
on a case by case situation.
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Effect
of Termination .
Upon any termination of this Agreement, Licensee shall be relieved
of all duties and obligations hereunder except to deliver the work
and progress.
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The term of
this Agreement shall be for the period of 10 years automatically
renew for period of one year every year unless terminate earlier by
a written notice sent to the other party at least 12 months of the
termination date. In the case of a termination or non renewal by
the Licensor for no reason or for a reason other than a material
breach of contract not remedied in due time, Licensor shall
compensate the Licensee for the loss of its exclusive
right.
The amount of
the loss of its exclusive right should be determined in good faith
by the parties taking into consideration the previous sales of the
Licensee and its expectation of sales for the future taking into
account the remaining protection rights conferred by the
Patent.
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WARRANTIES 0F LICENSOR and
licensee
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Licensor warrants
and represents to Licensee that the following are true and
correct:
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Licensor is the
beneficiary under a duly signed license of the entire right, title
and interest in and to the Patents and has the right to grant the
license granted under this Agreement;
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Licensor has
not at any time prior to the effective date of this Agreement
issued any license, grant or other working right to any person or
entity under any or all of the Patents with regard to the
manufacturing in North America;
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There are no
claims, actions, suits or proceedings pending or, to
Licensor’s knowledge, threatened against Licensor or relating
to any or all of the claims contained in the Patents. There are no
judgments or tax or other liens outstanding and unsatisfied against
Licensor or any of Licensor’s assets (including but not
limited to the Patents);
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Licensee is a
corporation duly created, validly existing and in good standing
under the law of the province of Québec . Licensee
has the power and authority to own, lease, license, or operate all
properties and assets now owned Licensee has heretofore delivered
to Licensor complete and correct copies of its organizational
documents, as amended and in effect on the effective date of this
Agreement.
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The foregoing
warranties and representations shall survive the execution of this
Agreement.
Licensor shall
hold Licensee harmless from and against any claims, demands,
actions, threatened actions, causes of action, judgments, damages,
losses (which shall include any diminution in value), liabilities,
costs of expenses (including, without limitation, interest,
penalties and reasonable attorney’ s and experts fees and
disbursements), including Tax liabilities (collectively, the
“Losses”) which may be made against Licensee which any
of them may suffer or incur a
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