67
TO: APPLE DENTAL VENTURES
XXX XXXXXXXXXX, RD.-
FAX: 000 000 0000
FROM; XXXXXX X. XXXXXX
GRITELL INTERNATIONAL LTD.
GRITELL INTERNATIONAL LIMITED
FAX: 000 000 0000
000 000 0000
MOB: 000 000 0000
DATE: FEBRUARY 2,1999
RE: BIOOCOMPATIBLE INTRAORAL THERMO ELASTIC MATERIAL (BITEM)
MOULDABLE ACRYLIC COMPOSITION
AMENDMENTOF AGREEMENT DATED DECEMBER 28,1998
Dear Bob:
Further to your meeting of January 29, 1999, at which time we advised
you of the need to restructure our planned public raising as a result
of recent changes in 'the Regulations governing Rule 504 transactions,
I wish to confirm that we have agreed upon the following changes to
the Agreement of December 28,1998, as follows:
1 Paragraph 2 (b) shall be amended to provide as follows:
"a one time payment of USD 230,000.00. payable USD 50,000.00 upon our
receiving the first USD 200,000.00 of our financing or capital
investment, no later than February 28, 1999, USD 105,000.00 payable in
three (3) installments of USD 35,000.00 each payable every two (2)
months, the first of such payments to be made on May 1, 1999, and the
balance of USD 75,000.00 to be paid no later than one (1) year from
the payment of the initial USD 50.000.00 payment referred to above;"
2. Paragraph 2(d) shall be amended by deleting therefrom all reference
to " you shall be entitled to purchase from the Company 100,000
common shares at USD 0.20 per share" and which shall be replaced by:
"you shall be entitled to purchase from the Company 100,000 common
shares at USD 0.0001 per share"
3. Paragraph 2(d) shall be further amended by deleting therefrom
"These 200,000 shares represent approximately fifteen (15) percent of
the shares sold to false the first USD 1,000,000.00 for the publicly
traded company (approximately 3,000,000 shares); and
4. Wherever the name Gritell International Ltd. appears in the
Agreement of December 28, 1998, it shall be deleted and replaced with
the name "Gritell International Limited" and the Agreement of December
28, 1998 shall be deemed to have been entered into with Gritell
International Limited ab initio.
All other provisions of the Agreement of December 28, 1998, shall
remain unchanged and of full force and effect.
You acknowledge being advised by Xxxxxx X. Xxxxxx that he is a
Barrister and Solicitor licensed to carry on the practice of law in
Ontario and that he has advised you to obtain independent legal advice
with respect to this Agreement and that you have either obtained such
advice or waive the right to do so. You further acknowledge that
Xxxxxx X Xxxxxx has never provided you with any advice, legal or
otherwise, in connection with this Agreement, the transaction
underlying it or any other matter whatsoever.
Please execute the Acknowledgement at the end of this letter and
return two originally signed copies to us.
Regard
XXXXXX X. XXXXXX
GRITELL INTERINATIONAL LTD.
GRITELL INTERNATIONAL LIMIITED
Encl.,
BITEMIO.WRI
68
ACKNOWLEDGEMENT
The undersigned by the execution of this Acknowledgement hereby
acknowledges his agreement with the terms of the above Letter of
Agreement and agrees to be bound by its terms and to take all actions
and to execute all documents reasonably required by Gritell
International Limited. to give effect to the substance of the
Agreement. The undersigned also agrees that this Letter of Agreement
replaces the Letter of Agreement dated April 29, 1998, which is no
longer of any force or effect.
DATED at Toronto, this the 3rd day of February, 1999.
XXX XXXXXXXXXX, RDT on his own behalf and on behalf of APPLE DENTAL
VENTURES
69
TO: APPLE DENTAL VENTURES
XXX XXXXXXXXXX. RDT
FAX: 000 000 0000
FROM: XXXXXX X. XXXXXX
GRITELL INTERNATIONAL LTD.
FAX: 000 000 0000
TEL: 000 000 0000
MOB: 000 000 0000
DATE: DECEMBER 28.1998
RE: BIOCOMPATIBLE INTRAORAL THERMO ELASTIC MATERIAL (BITEM) MOULDABLE
ACRYLIC COMPOSITION
Dear Bob:
Further to our meeting of December 21, 1998, with Xxxxxx Xxxxxxx and
Xx. Xxxxxx, I wish to confirm the terms of the amended transaction
discussed with you for the acquisition by us of the exclusive rights
to manufacture, market, distribute and sell BITEM worldwide:
1. You will grant to Gritell International Ltd., or as it may direct,
by way of licence, the exclusive rights to manufacture, market,
distribute and sell by retail and wholesale, by any and all methods,
the SITEM products developed by you and protected by U.S. Patent No.
5,431,663, Canadian Patent No. 2,111,789 and European Patent No.
0605912, all Divisional Patent* for all non-dental application along
with all Improvements and changes to the these Patents and any and all
Patents which may be Issued In respect of this material or any
variation of the material for the entire world for a term which is the
longer of 25 years or the life of the Patents or any extension or
amendments of the Patents along with the exclusive right to make use
of BITEM In connection with the manufacturing, marketing, distribution
and sale of the SITEM products throughout the world;
2. You will receive for the granting of this exclusive Licence the
following:
(a) a Royalty calculated as follows:
(i) 5% of the first $ 25,000,000.00 in gross income from the sale
BITEM products sold In each year;
(ii) 3.5% of the next $25,0000,000.00 in gross income from the sale
of Bitem products sold in each year;
(iii) 2.5% of all sales exceeding $ 50,000,000.00 of gross sales
from the sale of Bitem product sold in each year;
(b) a one time payment of USD 250,000,00, payable USD 50.000,00 upon
our receiving the first USD 200,000.00 of our financing or Capital
investment, no later than February 28, 1999 and USD 200,000.00 payable
to you from the sale of the USD 1.00 Units in connection with the Rule
504 raising, provided that twenty-five (25) percent of each USD
100,000.00 raised shall be paid to you as such monies are raised by
us, on the understanding that the Rule 504 raising shall be completed
no later than one (1) year from the payment to you of the one time
payment of USD 50,000.00 referred to above;
(c) a Consulting Agreement for a term of 3 years to engage in research
and development of further products, including additional applications
of BITEM, and to plan, supervise and carry out a comprehensive
promotion, marketing and training program as instructed by Gritell,
for which you will receive a fee of a maximum of CDN 60,000.00 based
upon CDN 400.00 per day for a minimum of 150 days per year. This
agreement shall be renewable on mutual consent for 2 successive
periods of two years each upon the same terms and conditions as the
original agreement save and accept for this renewal provision. All
inventions and new products developed as a result of such research and
development shall be the exclusive property of Gritell. The costs
associated with the filing of such Patent Applications and all costs
of maintaining such Patents, Including legal fees, shall be paid for
by Gritell, In addition to the above Consulting Fees, which shall be
paid monthly, you shall be paid all reasonable expenses incurred by
you in the performance of you duties under the Consulting Agreement,
provided that all such expenses have been approved, in writing by
Gritell in advance;
70
(d) should Gritell raise the monies needed to fund this acquisition or
at any subsequent time raise money from the ,public through a publicly
traded company, you will have the right to acquire, either by way of
options or performance bonuses, a number of shares of the public
company to be formed in an amount to be agreed upon. These shares
shall be subject to certain trading restrictions to ensure the
stability of the market. In the event that such a raising is done via
a Rule 504, Regulation "D" transaction through the NASDAQ Electronic
Bulletin Board, you shall be entitled to purchase from the Company
100,000 common shares at USD 0.20 per share and to an option to
purchase 100,000 common shares at 1.00 per share at any time during
the twenty-four (24) month period following the commencement of
trading of the Company's shares. These 200,000 shares represent
approximately fifteen (1 5) percent of the shares sold to raise the
first USD 1,000,000.00 for the publicly traded company (approximately
3,000,000 common shares);
(e) With respect to the Agreement entered into by you with Austenal,
these Royalties shall not be included in the calculation of gross
sales in each year and you shall be entitled to receive as a Royalty
forty (40) percent of the Royalty paid by Xxxxxxxx pursuant to your
Agreement with Austenal for the term of that Agreement, subject to our
approval of your Agreement with Xxxxxxxx and the assignment by you to
us or as we may direct; and
(f) all royalties provided for herein shall be calculated quarterly
and paid to you within thirty (30) days of the end of each quarter.
3. The grant of the Licences provided for in this Letter of Agreement
shall take effect as of the date upon which the initial payment of the
USD 50,000.00 referred to above has been paid, in any event no
later then February 28, 1999. Further, in the event that the payments
to you provided for in paragraph 2(b) hereof are not made as provided
for herein, the Licence shall be, at your sole discretion, null and
void, in which event all monies paid to you shall be forfeited to you
and you shall have no further claim against us for failure to pay
these monies or for the breach of this Agreement. Provided however,
that the Licencee shall have the option, exercisable at its sole
discretion, of extending the time for the payment of the balance by
paying to you the sum of USD 10,000.00 in respect of the first
calendar month of any default in payment of any payment due hereunder
and USD 15,000.00 for every calendar month thereafter while such
default continues. In the events that such payments are made, the
Licence shall remain in good standing and shall not be null and void
provided that such default shall not continue for more then six (6)
calendar months from the occurrence of the original default.
4. In consideration for the granting to Gritell of the worldwide
rights referred to in Paragraph I above, Gritell agrees that in the
event that the gross income from the sale of Bitem products is less
than CDN 5,000,000-00, on an annualized basis, by December 31, 2003,
based upon the sales of Bitem products during the last three (3)
months of 2003, then Gritell shall pay to you, commencing January
1,2004 and every year thereafter in which the gross income from the
sale of Bitem products, on an annualized basis, does not exceed CDN
5,000,000.00. for a maximum of five (5) years, a sum equal to five (5)
percent of the difference between the actual gross sales income from
the sale of Bitem products and CDN 5,000,000.00, in addition to the
Royalties provided for in Paragraph 2(a) hereof
5. Deleted.
6. Deleted.
7. It is acknowledged that Gritell International Ltd. is acting only
in the capacity of a Trustee for a Company or Companies to be
incorporated and shall have the right at it sole option of assigning
this or any subsequent Agreement(s) to any one or more of such
Companies, either in their entirety or otherwise. Upon such
assignment Gritell shall cease to have any liability to you.
8. You shall, upon the execution of the Acknowledgment at the end
hereof, provide to Gritell a schedule of all payments required to
maintain all Patents currently, or in the future, held by you, in
connection with the Bitem products, in good standing setting out the
amounts due, the dates due and the person or persons to whom payments
must be made (the "Schedule"). Gritell shall, for the full term or
71
any extension of the Agreement, make all payments as indicated in the
Schedule referred to above, as from time to time amended, required to
maintain the said Patents in good standing in accordance with the
Schedule.
9. Gritell shall, in consideration for your agreeing to the amendment
of the Agreement made between the Parties hereto dated September 23,
1998, as reflected herein, pay the sum of approximately CDN 8,000.00
required to maintain the Patents set out in the Schedule in good
standing, no later than January 6, 1999.
10. Any monies, advanced to you, from time to time, shall be deducted
from the one time payment of USD 50,000.00 referred to in Paragraph
1 above.
Please execute the Acknowledgement at the end of this letter and
return two originally signed copies to us.
Regards,
XXXXXX X. XXXXXX
GRITELL INTERNATIONAL LTD.
Encl.
BITEM8.WORD
ACKNOWLEDGEMENT
The undersigned by the execution of this Acknowledgement hereby
acknowledges his agreement with the terms of the above Letter of
Agreement and agrees to be bound by its terms and to take all actions
and to execute all documents reasonably required by Gritell
International Ltd. to give effect to the substance of the Agreement.
The undersigned also agree that this Letter of Agreement replaces the
Letter of Agreement dated April 29, 1998 and amends the Letter
Agreement of September 23, 1998, which are no longer of any force or
effect.
The undersigned also acknowledge:
(a) That Xxxxxx X. Xxxxxx has advised them that he is a Barrister &
Solicitor licensed to carry on the practice of law in the Province of
Ontario:
(b) That Xxxxxx X. Xxxxxx has advised them to obtain independent legal
advise with respect to this Agreement and the transaction referred to
in this Agreement;
(c) That the Undersigned have either obtained such independent legal
advise or have made the deliberate decision to ignore Xx. Xxxxxx'x
advise and have not obtained such independent legal advise; and
(d) That the Undersigned have not sought from Xx. Xxxxxx, nor has he
given them, any legal advice with respect to this Agreement or the
transaction referred to therein.
DATED at Toronto, this the 4th day of January, 1999.
XXX XXXXXXXXXX, RDT on his own half and on behalf of APPLE DENTAL VENTURES
72
TO: APPLE DENTAL VENTURES
XXX XXXXXXXXXX, RDT
FAX: 000 000 0000
FROM: XXXXXX X. XXXXXX
Counsel
GRITELL INTERNATIONAL LTD.
FAX: 000 000 0000
TEL: 000 000 0000
MOB: 000 000 0000
DATE: SEPTEMBER 23,1998
RE: BIOCOMPATIBLE INTRAORAL THERMO ELASTIC MATERIAL (DITEM) MOULDABLE
ACRYLIC COMPOSITION
Dear Bob:
Further to your meeting of April 29, 1 998. with Xx. Xxxxxx, I wish to
confirm the terms of the transaction discussed with you for the
acquisition by us of the exclusive, tights to manufacture, market,
distribute and sell BITEM for all of North America, South America and
the Caribbean:
1. You will grant to Gritell International Ltd., or as it may direct,
by way of licence, the exclusive, rights to manufacture,
market, distribute and sell by retail and wholesale, by any and all
methods, the BITEM products developed by you and protected by U.S.
Patent No. 5,431,563, Canadian Patent No. 2,111,789 and European
Patent No. 0605912, all Divisional Patents for all non-dental
application along with all improvements and changes to the these
Patents and any and all Patents which may be Issued in respect of this
material or any variation of the material for all of North America,
South America and the Caribbean for a term which is the longer of 25
years or the life of the Patents or any extension or amendments of the
Patents along with the exclusive right to make use of BITEM in
connection with the manufacturing, marketing, distribution and sale of
the BITEM products throught North America, South America and the
Caribbean;
2. You will receive for the granting of this exclusive licence the
following:
(a) a Royalty calculated as follows:
(i) 5% of the first $ 25,000,000.00 in gross income from the sale
BITEM products sold in each year;
(ii) 3.5% of the next $25,0000,000.00 in gross income from the sale
of Bitem products sold in each year;
(iii) 2.5% of all sales exceeding $ 50,000,000.00 of gross sales
from the sale of Bitem product sold in each year;
(b ) a one time payment of UDS 250,000.00, payable USD 50,000.00 upon
our receiving the first USD 200,000.00 of financing or capital
investment no later then December 31, 1998, USD 125,000-00 no later
than March 31, 1 999, and USD 75,000.00 no later then May 31st, 1999.
(c) a consulting agreement for a term of 3 years to engage in research
and development of further products, Including additional applications
of BITEM, and to plan, supervise and carry out a comprehensive
promotion, marketing and training program as Instructed by Gritell for
which you will receive a fee of a maximum of CND 60,000.00 based upon
CND 400.00 per day for a minimum of 150 days per year. This agreement
shall be renewable on mutual consent for 2 successive periods of two
years each upon the same terms and conditions as the original
agreement save and accept for this renewal provision. All inventions
and new products developed as a result of such research and
development shall be the exclusive property of Gritell. The costs
associated with the filing of the Patent Applications and all costs of
maintaining the Patents, including lehal fees. In addition to the
above Consulting Fees, you shall be paid all reasonable expenses
Incurred by you in the performance of you duties under the Consulting
Agreement; and
73
(d) should Gritell raise the monies needed to fund this acquisition or
at any subsequent time raise money from the public through a publicly
traded company, you will have the right to acquire, either by way of
options or performance bonuses. a number of shares of the public
company to be formed in an amount to be agreed upon. These shares
shall be subject to certain trading restrictions to ensure the
stability of the market. In the event that such a raising Is done via
a Rule 504, Regulation "D" transaction through the NASDAQ Electronic
Bulletin Board, you shall be entitled to purchase from the Company
100,000 common shares at USD 0.20 per share and to an option to
purchase 100,000 common shares at 1.00 per share at any time during
the twenty-four (24) month period following the commencement of
trading of the Company's shares. These 200,000 shares represent
approximately fifteen (I 5) percent of the shares sold to raise the
first USD 1,000,000.00 for the publically traded company
(approximately 3,000,000 common shares).
(e) With respect to the Agreement entered Into by you with Austenal,
these Royalties shall not be Included in the calculation of gross
sales In each year and you shall be entitled to receive as a Royalty
forty (40) percent of the Royalty paid by Xxxxxxxx persuant to your
Agreement with Austenal for the term of that Agreement, subject to our
approval of your Agreement with Xxxxxxxx and the assignment by you to
us or as we may direct.
3. The grant of the Licences provided for in this Letter of Agreement
shall take effect as of the date upon which the initial payment of the
USD 50,000.00 referred to above has been paid as provided for above,
Further, in the event that the payments to you provided for in
paragraph 2(b) hereof are not made as provided for herein, the Licence
shall be, at your sole discretion, null and void, in which event all
monies paid to you shall be forfeited to you and you shall have no
further claim against us for failure to pay these monies or for the
breach of this Agreement. Provided however, that the Licencee shall
have the option, exerciseable at Its sole discretion, of extending the
time for the making of such payments by paying to you the sum of USD
10,000.00 in respect of the first calender month of any default in
payment of any payment due hereunder and USD I 5,000.00 for every
calender month thereafter while such default continues. In the events
that such payments are made, the Licence shall remain in good standing
and shall not be null and void provided that such default shall not
continue for more then six (6) calender months from the occurrence of
the the original default.
4. Provided that gross income from the sales of Bitem Products amounts
to at least CDN 6,000,000.00 as of October 1, 2001, then we shall have
the first right to acquire the balance of the exclusive worldwide
rights to manufacture, market, distribute and sell, by retail and
wholesale, by any and all methods for the Bitem Products which are the
subject of the above Licence for North America, South America and the
Caribbean at no cost. In the event that gross income from the sales
of the Bitem Products do not reach CDN 8,000.000.00 by October 1,
2001, we shall have a first light of refusal in respect of these
worldwide rights or the rights to other areas upon the same terms and
conditions as are contained in any arms length, third party of which
is accepted by you.
5. In the event that gross income from the sales of the Bitem Products
is less than at least CDN 6,000,000 by October 1, 2001, then you shall
be entitled to receive, in lieu of lost Royalties, an amount equal to
five (5) percent of the difference between CDN 6,000,000.00 and the
actual gross income from the sales of Bitem Products as of that date.
6. You will refrain from entering into any agreements whatsoever for
the sale, marketing and distribution of the BITEM products without our
approval in writing, which approval shall not be unreasonably
withheld.
7. It Is acknowledged that Gritell International Ltd. is acting only
in the capacity of a Trustee for a Company or Companies to be
Incorporated and shall have the right at it sole option of assigning
this or any subsequent Agreement(s) to any one or more of such
Companies, either in their entirety or otherwise. Upon such
assignment Gritell shall cease to have any liability to you.
Please execute the Acknowledgement at the end of this letter and
return two originally signed copies to us.
Regards,
XXXXXX X. XXXXXX
Counsel
GRITELL INTERNATIONAL LTD.
Encl.
BITEM6.WRI
74
ACKNOWLEDGEMENT
The undersigned by the execution of this Acknowledgement hereby
acknowledges his agreement with the terms of the above Letter of
Agreement and agrees to be bound by its terms and to take all actions
and to execute all documents reasonably required by Gritell
International Ltd. to give effect to the substance of the Agreement.
The undersigned also agree that this Letter of Agreement replaces the
Letter of Agreement dated April 29, 1998, which is no longer of any
force or effect.
DATED at Toronto, this the 31 day of September, 1998.
XXX XXXXXXXXXX, RDT on his own behalf and an behalf of APPLE DENTAL
VENTURES
