August 15, 2000
JOINT VENTURE AGREEMENT
This Joint Venture Agreement (the Agreement or This Agreement) is
entered into this August 14 , 2000 by and between
Affordable Homes of America, Inc, hereinafter referred to as AHOA, a
Nevada Corporation whose principle place of business is 0000 X.
Xxxxxxxx Xxx. Xxxx X-0, Xxx Xxxxx, Xxxxxx, XXX and
XX Xxxxx Trading & Industrial Corporation, LLC, hereinafter referred
to as ALNASR, a corporation registered in the Kingdom of Saudi Arabia
(registration no. 3) whose principal place of business is Xxxx
Khashoggi Vila, Al Washem Street, Murabba's District, Riyadh, Kingdom
of Saudi Arabia.
WHEREAS
A. AHOA is the holder of two United States of America patents (number
5,782,970 and 5,852,077), the patents being issued for the manufactur
ing of a protected new and unique building material hereinafter refer
red to as the product;
B. AHOA has through extensive research and experience, developed low c
ost, rapidly produced housing models which meet minimum building xxxx
dards for the construction of homes in the United States and in many,
if not all foreign countries.
C. AHOA is now capable and ready to offer the product and
associated home building expertise to a joint venture
partner, specifically ALNASR to introduce, market and sell
the product in the Kingdom of Saudi Arabia and in other countries
mutually selected by ALNASR and AHOA.
D. Furthermore, AHOA is now capable and ready to
(a) provide full complete technical assistance in the establishment
of plants to manufacture the product and (b) provide all the
necessary expertise required to build and market low cost
homes in accordance with models created by AHOA
AND WHERAS
A. ALNASR has the experience and contacts necessary to (a) market
the product in the countries selected in the Middle East and Northern
Africa and (b) create the infrastructure necessary for AHOA to build
manufacturing plants for products where feasible.
B. ALNASR possesses the professional network which will work
diligently towards obtaining various permits and licenses as
required, both for the introduction of the product in the
countries selected and for the introduction of the product in
the countries selected and for the establishment of factories
to construct manufacturing facilities in line with this agreement;
C. Furthermore, ALNASR now desires to utilize its experience,
expertise and network to ensure the success of low cost housing models
by bidding for housing projects in countries selected at the very
earliest opportunity to this signing of this agreement.
NOW THEREFORE, In consideration of one United States Dollar (US$1.00)
receipt of which is hereby acknowledged and the mutual promises and
warranties contained herein, AHOA and ALNASR hereby agree as follows:
MARKETING AND PRODUCTION, LOW COST HOUSING
1. AHOA and ALNASR agree to the formation of two corporations
called Affordable Homes (Middle East), Inc., the said corporations,
unless otherwise agreed upon to be (a) a Canadian (British Columbia)
and (b) a United States of America (Nevada) corporation respectively;
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2. AHOA and ALNASR will each hold 50% of the Canadian and
US corporation ( the "JV Corporations") respectively
3. AHOA and ALNASR understand that each of the JV corporations
will be obliged to form alliances, partnerships or even JV agreements
with third parties depending upon the individual requirements and
project mechanics in each country:
4. AHOA will hereby grant the JV corporation the exclusive rights
to (a) introduce and market the product in various countries selected
and (b) construct manufacturing and production facilities to produce
the product in the said countries selected and furthermore,
unless there are fundamental reasons to the contrary AHOA
agrees to transfer such exclusive rights to any alliances,
partnerships or JV undertaken with third parties in any
particular country.
5. AHOA will also grant the JV corporation the exclusive right,
jointly, with other parties or on their own accords, to bid on low
cost housing contracts in countries selected using AHOA's product
and technical support.
6. AHOA warrants and guarantees that the product is feasible and
further warrants that all technical information provided to
ALNASR isaccurate and will be accurate at all times to
the best of AHOA management
7. AHOA warrants that the product is viable building product and
is one which can be produced and used at a cost substantially less
that the cost of normally existing wood or concrete based housing
materials
8. AHOA warrants that is engineer and technicians will be available
for on site presentations, reviews and studies in the countries
selected to assist ALNASR in any of its efforts envisaged in this
Agreement
9. ALNASR agrees to use its best efforts to introduce, market and
sell the product in countries selected and further agrees that the
first country will be selected within 7 business days of the
signing of this Agreement
10. ALNASR agrees that it will arrange for the preparation and
submission of competitive bids which will be based on the use of
the product (either via local production or via exports) to produce
low cost housing in the country of countries selected.
11. ALNASR may provide, as its own contribution towards the Joint
Ventures envisaged herein, land or buildings and such land or buildings
will be acceptable to AHOA, if (a) they are deemed suitable for
the furtherance of the objectives of the joint venture and (b)
they are valued as per recognized local or international standards;
12. Each party will have equal representation of the Board of Directors
of the corporation (per 1) unless such representation needs to be
altered due to locally prevailing regulations in which case
both parties shall arrive at mutually acceptance representations;
COSTS, FEES, EXPENSES & ORGANIZATION
13. Further to a Letter of Intent dated August 07, 2000, AHOA and
ALNASR have made their initial contributions of $US 25,000.00
(United States Dollars Twenty Five Thousand only) each towards
preliminary expenses designed to identify the precise nature of
opportunities for the product in all countries in the Middle East
and in certain countries forming the Northern Africa.
14. AHOA and ALNASR hereby, agree form this juncture, to
operate the agreement only through the JV Corporations (per 1);
15. AHOA and ALNASR hereby agree that both parties will contribute
a specified amount towards their share of initial capitalization of
the corporations in such a manner that preliminary travel cost, legal
fees and other expenditures are accounted for prior to formal
capitalization pursuant to the actual implementation of country
specific joint ventures for production, marketing and bidding purposes.
16. AHOA and ALNASR hereby agree to appoint Xx. Xxxxxxx Xxxxx,
President of Africa Resources Corporation, Vancouver, as Secretary
of the Canadian corporation and AHOA appointee as Secretary
of the US Corporation for the primary purpose of maintaining and
preparing books, records, timetables, timelines and expense budgets;
17. AHOA and ALNASR hereby agree to appoint Xx. Xxxxxxx Nemerqut as
General Counsel for purposes envisaged in this Agreement;
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IMMEDIATE OBJECTIVES
18. ALNASR, will, within 7 business days of the signing of this
Agreement, provide written confirmation of a least one country chosen
for immediate implementation of the objectives of the Joint Venture
with AHOA, namely to produce and manufacture the product and,
further more, to promote low cost housing projects;
19. ALNASR will within 7 business days of the signing of this
Agreement, provide a plan of action for a least four other countries
where such plan will be implemented depending upon the level of resources
available to AHOA;
20. ALNASR and AHOA will cause the formation of the corporations
(per 1) with immediate effect so that the Secretaries of the Corporations
can prepare and formalize books, records, and budgets in line
with the objectives of the Agreement;
21. In order to fund the JV, and to complete other obligations under
the Agreement, AHOA will immediately conduct a private placement
financing in which cause AHOA will be actively assisted by
Africa Resource Corporation and by ALNASR;
22. ALNASR hereby agrees to make all arrangements, in conjunction
with Africa Resources, to enable AHOA to complete the targeted private
placement for a sum expected to be for a minimum of $7.00
million and for a maximum of $15 million with the overriding
provision that the bulk of the proceed excluding certain operating
and working capital costs agreed upon, will be utilized to fund AHOA's
share in the joint venture and/or joint ventures envisaged therein;
23. ALNASR is aware that shares issued as a consequence of the
private placement by AHOA will be restricted shares (either Rule 144
or Reg,'S') and such shares may remain restricted for trading in the
US either for a period of 12 months from the date of the issuance or
pending AHOA effecting the appropriate registration of the securities
issued;
GENERAL
24. It is explicitly understood by ALNSAR that AHOA's near term
and longer term participation, especially in the manufacture of the
product in one or more countries, is reliant upon the success of the
private placement (per 22) and a failure to satisfactorily complete the
private placement will make it impossible for AHOA to meet the forthcoming
commitments as outlined in this Agreement;
25. The term of the Agreement shall be for a period of three (3) years
with and automatic renewal for twenty five (25) years if a minimum of
US$ 100,000,000.00 (United States Dollars One Hundred Million) of actual
construction value is achieved within three years where such construction
value will be the aggregate of construction expenditures in one or more
countries designated by ALNASR;26. Since the representation on the Board
of Directors (per 1) shall be equally split between AHOA and
ALNASR, any stalemate in voting- despite the best efforts of both
parties- will be submitted to an independent Arbitrator selected from
the American Arbitrator Association in which case the
Arbitrator's decision will be final;
27. This agreement may be terminated for any of the following reasons:
a. By mutual consent of both parties
b. By the failure of ALNASR to secure necessary licenses
permits and other related arrangements in at least 1 country
over a period of 12 months form the date of signing this Agreement.
c. By the failure of ALNASR to forward a comprehensive plan
of action for the JV corporations within 12 months from the
date of signing this Agreement;
d. By the failure of AHOA to complete the private placement
envisaged herein within 6 months from the date of signing
this Agreement;
e. By the failure of AHOA to demonstrate adequately that
the product meets with all necessary minimum requirements
and furthermore, to prove that the low cost housing model
is reality;
28. The Agreement may be amended at any time provided that any amended
agreement is in writing, signed by both parties and clearly referenced;
29. All timetables of timelines mentioned herein and appearing as the
duties of any of the parties to the Agreement may be extended with
the written consent of both parties to the agreement and the parties
concerned hereby agree that certain requirements or provisions may be
waived provided that such waiver is mutually agreed in writing
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30. Address for notices and other communications:
AHOA Affordable Homes of America, Inc
0000 X. Xxxxxxxx Xxx. Xxxx X-0
Xxx Xxxxx, XX
#000-000-0000
Fax#-702-579-4833
e-mail:xxxx@xxxxxxxxxxx.xxx
XX XXXX Trading & Industrial Corporation LLC
Xxxxx Xxxxxxxxx Villa
Al Washem Street
Murabba's District
Riyadh, Kingdom of Saudi Arabia
Telephone: 0-0000-000-0000
Fax:0-0000-000-0000
31. The Agreement is the final written expression and the complete and
exclusive statement of the parties namely AHOA and ALNASR. It super-
sedes any and all other agreements (and letters of intent as the case may
be) written or oral between the parties and alterations or amendments
hereinafter must only be with the written and mutual content of AHOA
and ALNASR:
32. The Agreement, and its terms and conditions, shall be govern by
the laws prevailing in the State of Nevada or laws in other jurisdictions
if and when applicable;
33. In the event that any pan of the Agreement is determined invalid by
a court of competent jurisdiction, such determination shall not effect
the validity of the remaining portion of the Agreement:
34. Both parties agree that, within the framework of the Agreement, certain
commission and/or finder's fees will be payable to Charlesbridge Holdings
(Europe) Corporation/Africa Reiources Corporation and to The Aiegis Group
and that the said commissions and fees will be negotiated separately and
will form part of a separate aereement.
SIGNED AND ACCEPTED
DATED: 08/15/2000
For AFFFORDABLE HOMES OF AMERICA, INC
By: /s/ Xxxxx Xxxxxxxx
--------------
Xxxxx Xxxxxxxx
President
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FOR XX XXXX TRADING AND INDUSTRIAL CORPORATION LLC
By /s/ XXXXX XXXXXXXXX
---------------
XXXXX XXXXXXXXX
DIRECTOR
end of agreement.
TOTAL 8 PAGES
