Marketing and Distributorship Agreement THIS EXCLUSIVE MARKETING AND DISTRIBUTORSHIP AGREEMENT IS MADE THIS 21ST DAY OF NOVEMBER, 2007 BETWEEN MEGOLA INC., a corporation incorporated under the laws of the State of Nevada with its principal office in...
Marketing
and Distributorship Agreement
IS
MADE THIS 21ST
DAY OF NOVEMBER, 2007 BETWEEN
MEGOLA
INC.,
a
corporation incorporated under the laws of the State of Nevada
with
its
principal office in the city of Corunna, Ontario, Canada,
jointly
with;
MSE
ENVIRO-TECH CORP.,
a
corporation incorporated under the laws of the State of Delaware
with
its
principal office in the city of Brentwood, TN, U.S.A.,
(hereinafter
referred to as the “Vendors”)
-and-
JANUS
PRODUCTS CORP. a
corporation incorporated under the laws of the
State
of
Nevada with its principal office in the city of Pt. Xxxxxx
Ontario,
Canada,
(hereinafter
referred to as the “Purchaser”)
Wherein
the Vendors and the Purchaser are sometimes collectively referred to as the
“Parties”, and individually as a “Party”.
W
I T N E S S E T H:
WHEREAS,
the
Vendors are in the business of marketing a 100% cotton fabric blanket treated
with Hartindo AF21 fire inhibitor applied to the fabric (together a “Fire
Blanket”) in North America, samples of which have been examined by the
Purchaser, and Vendors possess all rights to the use of trademarks, trade names,
copyrights, and designs associated with the said Product as identified in
Exhibit ‘A’ hereto;
WHEREAS,
the
Purchaser wishes to secure the exclusive sale and distribution rights for the
above
Product
for
Residential use only in Canada and the United States, and the non-exclusive
rights thereto in the same territories for Industrial and Commercial
use.
WHEREAS,
the
Parties desire to enter into a marketing, distribution and license agreement
on
the terms set forth herein (the "Agreement"),
NOW,
THEREFORE,
in
consideration of the mutual promises contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Parties agree as follows:
| 1. |
The
term “Product” wherever used herein shall mean the Fire Blanket specified
in Exhibit A hereto intended for Residential use. The same type of
blanket
in variable sizes for Industrial and Commercial use is herein called
the
“Industrial Fire Blanket.
|
| 2. |
Grant
of Rights; Territory; Exclusive &
Non-Exclusive.
|
| 2.01 |
The
Vendors hereby appoint the
Purchaser
as
its distributor for the term of this Agreement for the marketing,
sale and
distribution of the Product
and Industrial Fire Blanket
in
the fifty states of the United States, the District of Columbia,
Puerto
Rico, the United States Virgin Islands and all other United States
territories and possessions, and duty free markets located therein,
and
for Canada (the foregoing territories being collectively herein called
the
”Territory”), subject as follows. The appointment with respect to Product
shall be limited to and exclusive for sales for residential usage
and
non-exclusive with respect to Industrial Fire Blankets for Commercial
and
Industrial sales. For absolute clarity, it is understood that the
Purchaser’s exclusivity rights do not in any manner prevent the Vendors
from selling Product and Industrial Fire Blankets directly to any
Commercial or Industrial entity for use within their business, nor
from
selling Industrial Fire Blankets to any third party distributor in
the
Territory.
|
| 2.02 |
The
Vendors agree not to sell Product directly to any third party distributor
in the Territory without the prior written consent of the Purchaser,
which
will not be unreasonably withheld.
|
| 2.03 |
The
Purchaser shall pay to the Vendors for Product the price per Blanket
(unit) stipulated in Exhibit B hereto, PLUS the royalty on the Purchaser’s
invoice price of all Product sold by it, as also stipulated in Exhibit
B
hereto. Vendors, on 15 days prior written notice, may inspect the
Purchasers books and records to verify said royalty payments, and
any
adjustments to be made shall be effected between the Parties within
the 30
day period immediately following the inspection.
|
| 2.04 |
The
prices for Industrial Fire Blankets sold to the Purchaser hereunder
shall
vary with size and other factors and shall be determined from time
to time
by the Parties.
|
| 3. |
Term
of Agreement; Renewal.
|
| 3.01 |
The
initial term of this Agreement shall commence upon the execution
hereof,
and shall, provided this Agreement has not previously been terminated,
continue for sixty months (60 months) from the commencement date
hereof
(the "Initial Term"), subject to the Purchaser meeting the following
minimum Product sales conditions:
|
|
f)
|
At
least 250,000 units in the first 12 consecutive
months
|
|
g)
|
At
least 750,000 units cumulatively within the first 24 consecutive
months
|
|
h)
|
At
least 1,250,000 units cumulatively within the first 36 consecutive
months
|
|
i)
|
At
least 1,750,000 units cumulatively within the first 48 consecutive
months
|
|
j)
|
At
least 2,500,000 units cumulatively within the first 60 consecutive
months.
|
Upon
the
Purchaser’s failure to meet any of the performance conditions prescribed in this
clause 3.01, this agreement shall automatically terminate without
notice.
| 3.02 |
Upon
the expiration of the Initial Term, and provided this Agreement has
not
previously been terminated, the term of this Agreement will
automatically be renewed if the performance conditions set out in
clause
3.01 above have been fully met. Each renewal period shall be for
the next
12 consecutive months (Renewal Term), and require minimum sales of
500,000
units during each Renewal Term in order for the next Renewal Term
to be
become effective. Failure to meet this minimum quota by the last
day of
any Renewal Term shall result in the automatic termination of this
agreement without any notice requirement. Notwithstanding the foregoing,
either
Party (Vendors or Purchaser), may terminate this Agreement upon not
less
than six (6) months prior written notice to the other Party.
|
| 3.03 |
Whenever
use is made herein of the word "Term" to refer to the term of this
Agreement, such word shall be deemed to refer to the Initial Term
or any
subsequent Renewal Term or extension
thereof.
|
| 4. |
Purchase
and Sales; Price; Delivery.
|
| 4.01 |
During
the Term of this Agreement, the
Purchaser shall,
from time to time, submit to the Vendors purchase orders (“Order and/or
Orders”) for Product and Industrial Fire Blankets. Upon the Vendors’
receipt of any such Order, the Vendors shall promptly advise the
Purchaser
of the Vendors’ acceptance or rejection of the Order. In the event of any
conflict between the terms of such Order and this Agreement, the
terms of
this Agreement shall prevail.
|
| 4.02 |
Product
and Industrial Fire Blankets sold to the
Purchaser
pursuant the Vendors' acceptance of Orders pursuant to Section 3.01
shall
be delivered FOB manufacturer’s point of shipment to the
Purchaser with
all risk of loss and damage thereafter to be borne by the
Purchaser.
|
| 4.03 |
The
initial price of the Product shall be as set forth in Exhibit B.
At any
time, and from time to time, the Vendors may alter the price of Product,
to be effective upon delivery of written notice to the Purchaser
specifying the new price.
|
| 4.04 |
The
purchase price for Product, excluding the royalty payable, must be
made at
the time an Order is placed, and shall be made by the
Purchaser to
the Vendors by direct bank-to-bank wire transfer in US Dollars to
an
account designated by the Vendors, or by such other means as the
Vendors
may advise the
Purchaser from
time to time. Orders not accompanied by payment will not be accepted
or
processed.
|
The
royalty payable on all Product sold by the Purchaser, shall be accrued for
each
calendar quarter, and be paid in the above manner within 15 days of the end
of
each respective quarter.
| 5. |
Duties
of the
Purchaser
|
Without
limiting the generality of the other provisions of this Agreement imposing
obligations upon the
Purchaser,
the
Purchaser shall
fully and faithfully carry out the following duties:
| 5.01 |
The
Purchaser
shall utilize its best efforts to promote, extend and maximize sales
of
Product and Industrial Fire Blankets, and the reputation of these
products, throughout the Territories, and shall conduct its business,
and
otherwise act, in all matters concerning the Vendors and such products,
in
a manner which will benefit and enhance the Vendors' and the said
product's interests and reputation.
|
| 5.02 |
The
Purchaser shall
monthly provide the Vendors with written reports fully disclosing
Product
and Industrial Fire Blankets sales within the Territory, setting
forth (a)
total number of units sold; (b) the selling price for each unit;
and (c)
the total royalty due Vendors.
|
| 5.03 |
The
Purchaser
shall sell the Product and industrial fire Blankets in the Territory
only
under the trademark and trade name normally used for such products
by the
Vendors and, except to the extent otherwise agreed in writing by
the
Vendors, only in the packaging and in the same condition as that
in which
said products are dispatched by the Vendors and with all packaging
intact.
|
| 5.04 |
The
Purchaser disclaims any and all interest in and/or
to
all patents, trademarks, trade names, copyrights and designs concerning
the Product and/or Industrial Fire Blankets, other than is expressly
granted under this agreement. The
Purchaser
shall not apply for registration or other rights to any of the foregoing,
or the rights to anything similar to any of the foregoing, and all
literature supplied by the Vendors concerning the Vendors or the
above
products shall be and remain the property of the Vendors and no rights
to
use such property shall accrue to the
Purchaser as
a result of this Agreement other than as authorized by the
Vendors
|
| 5.05 |
The
Purchaser
shall inform the Vendors of any infringement or threatened infringement
of
any trademark, trade name, copyright or design concerning the Product
in
the Territory that it becomes aware of, and in any legal proceeding
or
other effort taken by, or on behalf of, the Vendors concerning any
such
infringement or threatened infringement, the
Purchaser
shall provide the Vendors or anyone acting on the Vendors' behalf
whatever
assistance the Vendors shall reasonably request other than payment
of the
Purchaser’s legal fees and other related
costs.
|
| 5.06 |
The
Purchaser shall,
on or before June 1st
of
each year notify the Vendors in writing of its anticipated purchase
requirements (“Forecast”), broken down by month, for Product and
Industrial Fire Blankets during the coming year (such notice of
anticipated requirements shall not operate as, or be deemed to be,
a
guarantee by the
Purchaser to
attainment of such volume, or a guarantee by the Vendors as to the
availability of such volume). The Forecast shall be updated at least
every
90 days and each update is due to Vendors by the 15th
of
the month following the end of a calendar quarter (namely, January
15th,
April 15th,
July 15th
and October 15th).
|
| 5.07 |
The
Purchaser
shall comply with all applicable Federal, State and local laws and
regulations.
|
| 5.08 |
The
Purchaser shall
bring to the attention of the Vendors any information received by
the
Purchaser which
is likely to be of interest, use, or benefit to the Vendors in relation
to
the marketing of the Product in the
Territory.
|
| 5.09 |
The
Purchaser shall
not, in the event of damage to any of the Product and/or Industrial
Fire
Blankets which affects the contents thereof, or renders the packaging
unsightly or of less than first class condition, sell or otherwise
dispose
of such Product or permit the same to become the property of any
insurer,
carrier or salvage company, except in accordance with prior written
instruction from the Vendors.
|
| 6. |
Duties
of the
Vendors
|
Without
limiting the generality of the other provisions of this Agreement imposing
obligations upon the Vendors, the
Vendors
shall
fully and faithfully carry out the following duties:
| 6.01 |
The
Vendors shall fill the
Purchaser's
Orders for Product and Industrial Fire Blankets which are accepted
by
the
Vendors
pursuant to Section 3.01 in accordance with the specifications in
each
such Order except to the extent that the
Vendors
is
unable to do so as a result of circumstances reasonably beyond the
control
of the
Vendors.
|
| 6.02 |
Product
and Industrial Fire Blankets sold to Purchaser shall, at the time
of
shipment, be of good quality and properly packaged for sale in the
Territory and, where special packaging is required to conform to
applicable laws, regulations and requirements in effect in a specific
jurisdiction within the Territory, shall comply with these special
packaging instructions
|
THERE
ARE NO OTHER WARRANTIES, EXPRESSED OR IMPLIED, INCLUDING ANY WARRANTY OF
MERCHANTABILITY OR OF FITNESS FOR ANY PARTICULAR PURPOSE.
| 6.3 |
The
Vendors shall take reasonably necessary steps to prevent the infringement
of the Purchasers rights hereunder and/or any of the Vendors’ patents,
trademarks, trade names, emblems, designs or other similar industrial
or
commercial property rights within the
Territory.
|
| 6.04 |
The
Vendors will provide reasonable technical support and a media
representative(s) to address media attention and/or product related
issues
and questions by way of public appearances.
|
| 6.05 |
The
Vendors will also assist the Purchaser
in
obtaining any certifications required for sale of the product in
the
Territory. Vendors, through CTT Group Inc., (xxx.xxxxx.xxx)
in Montreal have already obtained the certification for Product and
Industrial Fire Blankets as a Fire Blanket and the certification
instrument is attached as Exhibit
‘C’
|
| 7. |
Advertising
and Promotion.
|
The
Vendors and the
Purchaser
shall
consult with each other to prepare and execute annual marketing and promotional
plans and programs, and otherwise to determine when and how the Product and
Industrial Fire Blankets shall be advertised in the Territory, what expenditures
should be made for advertising and sales promotion purposes, how and through
which media such expenditures should be made, and who among advertising agencies
and public relations firms should be retained, provided that with respect to
all
of the foregoing, in the event of any disagreement, the Vendors shall make
the
final decision.
| 8. |
Confidentiality.
|
| 8.1 |
The
term “Confidential Information” as used in this Agreement means all
information in any form whatsoever disclosed in any manner by or
on behalf
of one Party to the other prior to and during the term of this Agreement,
which in any manner is related to the Product and/or Industrial Fire
|
Blankets
and/or the respective businesses of the Parties, and which the disclosing Party
treats as confidential. Without limitation, Confidential Information shall
include information about trade secrets, products, raw materials, packaging,
manufacturing processes, financial information, business plans, marketing and
sales plans, and all other confidential concepts and methods of doing business
related to the manufacture of Product and/ Industrial Fire Blankets. The
provisions of this clause .8.1 and Clause 8.2 shall survive the termination
of
this agreement and remain enforceable by either Party for a period of five
(5)
years from the date of this agreement.
| 8.2 |
Notwithstanding
the foregoing paragraph, the parties agree that the term Confidential
Information shall not include any information
which:
|
| (a) |
is
in the public domain prior to receipt by the receiving Party or subsequent
to the date of receipt without breach of this Agreement by the receiving
Party, or
|
| (b) |
is
known, as evidenced by documentation, to the receiving Party prior
to
disclosure by the disclosing Party, provided that any direct or indirect
source of such information was not known by the receiving Party to
be
bound by a confidentiality agreement with or other contractual, legal
or
fiduciary obligation of confidentiality to the disclosing Party or
any
other party with respect to such information;
or
|
| (c) |
is
disclosed without restriction to the receiving Party by a third party
having a bona fide right to disclose the same to the receiving Party
without breach of this Agreement or any other confidentiality agreement
with or other contractual, legal, fiduciary obligation of confidentiality
to the disclosing Party or any other party with respect to such
information; or
|
| (d) |
is
independently developed by the receiving Party without use of any
Confidential Information disclosed by the disclosing Party;
or
|
| (e) |
is
approved for public release or use by written authorization of the
disclosing Party.
|
| 9. |
Force
Majeure.
|
An
"Event
of Force Majeure" shall mean any Act of God, war, riot, mobilization, embargo,
governmental rules, regulations or decrees, drought, typhoon, flood, fire,
earthquake, strike, lockout, labor disturbance, difference with workers,
accident to machinery, failure of sources of supply of materials ordinarily
used
for the production of the Product or Industrial Fire Blanket, shortage of ships,
or any other event beyond the control of the Party affected, whether similar
or
dissimilar to any of the foregoing. The Vendors shall not be required to deliver
any Product or Industrial Fire Blanket if prevented from so doing by an Event
of
Force Majeure. The
Purchaser
shall
not be required to accept delivery of any Product or Industrial Fire Blanket
if
prevented by an Event of Force Majeure, except with respect to any delivery
already in transit on the date written notice is received by the Vendors. Each
Party shall promptly notify the other in writing of the existence of an Event
of
Force Majeure and, to the extent possible, of the probable duration of any
disability caused thereby. The Vendors are not, however, thereby relieved from
making delivery, or the
Purchaser
from
accepting delivery, pursuant to this Agreement when the Event of Force Majeure
no longer exists. The
Purchaser's
failure to accept delivery or to make payment for any quantity of the Product
or
Industrial Fire Blanket ordered by Purchaser, shall, at the Vendors' option,
release the Vendors from making any further deliveries until the Event of Force
Majeure no longer exists.
| 10. |
Termination.
|
| 10.01 |
Either
Party may immediately terminate this Agreement, without prejudice
to
whatever other remedies it may have, by giving notice in writing
to the
other Party of its decision so to terminate,, upon the occurrence
of any
of the following:
|
| (a) |
If
a Party shall be in breach of any of the provisions of this Agreement,
and
shall not remedy such breach to the satisfaction of the other Party
within
thirty (30) days after receipt of written notice providing particulars
of
the breach, unless such breach is not capable of being remedied,
in which
event this Agreement may be terminated forthwith by serving written
notice
thereof referring to this Section
10.01(a);
|
| (b) |
If
(i) the other Party shall become insolvent or admit in writing its
inability to pay its debts as they mature; (ii) the other Party shall
make
any assignment to or for the benefit of creditors or seek to obtain
an
extension of time within which to pay obligations; (iii) the other
Party
suffers any distress or execution to be levied on a substantial part
of
its property; (iv) the other Party applies for, consents to, or acquiesces
in the appointment of a trustee, receiver or custodian for it or
any of
its property; (v) in the absence of an application, consent or
acquiescence, a trustee, receiver or custodian is appointed for the
other
Party or any of its property; or (vi) any bankruptcy, reorganization,
debt
arrangement, or other proceeding under any bankruptcy or insolvency
law,
or any dissolution or liquidation proceeding, is instituted by or
against
the other Party;
|
| 10.02 |
Upon
any termination of this
Agreement
|
| (a) |
The
Purchaser
shall (i) immediately cease use of the property and rights licensed
to it
hereunder and those identified in Exhibit A hereto and in this regard
shall take all corporate action necessary to forthwith change its
corporate name if so directed in writing by the Vendors or either
of them,
and
|
| (b) |
Promptly
return or otherwise dispose of as directed by the Vendors, pamphlets,
catalogues, advertising materials, specifications and other materials
which the
Purchaser
may have in its possession or under its control relating to the Vendors
or
the Product or Industrial Fire Blanket,
and
|
| (c) |
The
Vendors shall repurchase, or the
Purchaser
shall sell to any person as directed by the Vendors, all inventory
of the
Product or Industrial Fire Blanket held by the Vendors at the time
of such
termination for a purchase price equal to the Vendors' original cost
of
such inventory of products pursuant to the Vendors invoice. The
Purchaser
shall then deliver the inventory so purchased to any person or place
as
directed by the Vendors, provided, however, that the
Purchaser
shall not be responsible for paying the cost of such
delivery.
|
| 11. |
Miscellaneous.
|
| 11.01 |
No
Assignment
|
Each
Party enters into this Agreement in reliance upon the other Party's specific
personal qualities including ability, skill, trust, experience, credit,
character and judgment, and neither Party shall assign, mortgage or charge
this
Agreement or any of the rights or obligations contained in this Agreement,
however;
the
Vendors shall allow the Purchaser the authority to assign this agreement to
a
100% wholly owned subsidiary of the Purchaser provided that wholly owned
subsidiary legally binds itself to the Vendors, to the satisfaction of the
Vendors, to observe and carry out the terms and conditions of this agreement
to
the same extent as the Purchaser is now bound. Upon compliance with this
condition, the said subsidiary may market and sell the Vendors Products
and
Industrial Fire Blanket
under
its name.
| 11.02 |
Sale
or Merger
|
The
agreement will survive any sale, merger, or acquisition of the Vendors or
Purchaser.
| 11.03. |
Construction;
Entire Agreement; Applicable Law.
|
This
Agreement constitutes the entire agreement and understanding of the Parties
with
respect to its subject matter, supersedes all prior negotiations, understandings
and agreements concerning the subject matter thereof, and shall be construed
and
interpreted in accordance with the laws of the State of Nevada, without regard
to the law of the conflicts of law of said State.
Any
headings in this Agreement are for convenience only and not intended to
influence its construction. In this Agreement, unless the context requires
otherwise, the singular includes the plural, and the plural includes the
singular, and all references to Sections shall be to sections of this
Agreement.
|
11.04
|
Counterparts.
This Agreement may be executed in counterparts, each of which shall
be
deemed an original, and which together shall constitute one and the
same
instrument.
|
|
11.05
|
Amendment
and Modification.
This Agreement may not be amended or otherwise modified except by
a
writing referring to this Agreement duly executed by both of the
Parties.
|
| 11.06 |
Notices.
Any written notice or other communication required or permitted hereunder
shall be deemed given when delivered personally or deposited in the
mails
of the country of origin of such written notice by air mail, registered
or
certified, or its equivalent in the country of origin, postage prepaid,
addressed as follows, or when sent by telefax providing proof of
receipt
is received by the sender:
|
| (a) |
If
sent to the Vendors to:
|
|
MSE
Enviro-Tech Corp
|
|
|
000
Xxxxxxx Xx., Xxxxx 000
|
000
Xxxxxxxx Xx, Xxx 000X
|
|
Xxxxxxx,
Xxxxxxx, X0X 0X0
|
Xxxxxxxxx,
XX 00000
|
|
Xxxxxx
|
XXX
|
|
Tel:
000-000-0000
|
000-000-0000
|
|
Fax:
000-000-0000
|
000-000-0000
|
| (b) |
If
sent to the Purchaser to:
|
|
Janus
Products Corp.
|
|
c/o
Verbeek & Verbeek Law
|
|
0000
Xxxxxxxx Xxxx X, Xxxx #00
|
|
Xxxxxxxxxxx,
Xxxxxxx, Xxxxxx
|
|
X0X
0X0
|
|
Tel:
000-000-0000
|
|
Fax:
000-000-0000
|
or
to
such other address or telefax number as may be furnished in writing in such
manner by either Party. Any written notice or other communication given in
any
manner other than as provided in this Section 11.05 shall be deemed to have
been
given only when actually received.
|
11.07
|
Further
Assurances.
The
Parties shall execute and deliver such documents and take such other
actions as may reasonably be required, from time to time, in order
to
effectuate the purpose and to carry out the terms of this
Agreement.
|
|
11.08
|
No
Waiver.
The failure or omission by either Party to insist upon or to enforce
any
of the terms hereof shall not be deemed a waiver by such Party of
the
right to protest or terminate this Agreement for breach of any such
terms,
unless such waiver shall be in a writing referring to this Agreement
and
duly executed by such Party. A waiver of any right on one occasion
shall
not constitute a bar to, or a waiver of, any such right on any future
occasion.
|
|
11.09
|
Relationship
Between the Parties.
The relationship between the Parties is as between principals and
not as
between principal and agent. Neither Party shall have the authority
to
bind the other in any manner whatsoever, and neither Party shall
hold
itself out, or otherwise describe itself as, agent for the other
by way of
correspondence, document, nameplate, sign or any other oral or written
notice or other communication.
|
|
11.10
|
Survival.
The provisions of Section 8 shall survive any termination of this
Agreement as a separate agreement of the
Parties.
|
IN
WITNESS WHEREOF this Agreement has been executed by the duly authorized officers
of the parties hereto, to be effective as of the date first written
above.
|
MSE
Enviro-Tech Corp.
|
|
|
Per:
|
Per:
|
|
Xxxx
Xxxxxxx (for Megola Inc.)
|
Xxxx
Xxxxxxxx (for MSE Enviro-Tech Corp.)
|
|
Date:
November 21, 2007
|
Date:
November 21, 2007
|
|
Janus
Products Corp.
|
|
|
Per:
|
|
|
Xxxxx
Xxxxxx (for Xxxxx Products Corp.)
|
|
|
Date:
November 21, 2007
|
Exhibit
‘A’
Exhibit
‘B’
Payment
Schedule
|
Product
/ Remarks
|
Paid
To
|
Amount
|
Units
|
|
Fire
Blanket / Royalty
|
Vendors
|
per
Blanket
|
|
|
Fire
Blanket / Cost each
|
Vendors
|
per
Blanket
|
All
payments made by Janus Products Corp. to Vendors as detailed in Section
2.03
Exhibit
‘C’
Certification
Documents
NFPA
701
Standard
Methods of Fire Tests for Flame Propagation of Textiles and
Films
NFPA
2112
Standard
on Flame-Resistant Garments for Protection
on
Industrial Personnel Against Flash Fire
Section
7.1: Fabric Requirements
