Exhibit 10.3
RESEARCH AND DEVELOPMENT SERVICES AGREEMENT
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UNITED STATES
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THIS AGREEMENT dated for reference and made with effect from the 21st day of
September, 2000 (the "Effective Date")
AMONG:
THERMO ENZYME PRODUCTS INC., a British Columbia Company having its
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registered and records office at Suite 1880 - 1055 West Georgia
Street, PO Box 11122, Vancouver, British Columbia V6E 3P3
(the "Consultant")
AND:
DURO ENZYME SOLUTIONS INC., a Corporation formed under the laws of the
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State of Nevada having an address at 50 West Liberty, Suite 880, Reno,
Nevada 89501
(the "Company")
AND:
DURO ENZYME PRODUCTS INC., a Corporation formed under the laws of the
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State of Nevada having an address at 101 Convention Center Drive,
Suite 1200, Las Vegas, Nevada 89109
(the "Parent")
RECITALS:
A. The Company has agreed to retain the services of the Consultant, as the
Company's prime supplier, to provide research, development and related
consulting services to the Company, as described in Schedule "A" attached hereto
and hereinafter defined as the Services and the Consultant agrees to provide the
Services to the Company, in accordance with the terms and conditions contained
herein;
B. The Company is a wholly-owned subsidiary of the Parent and the Parent has
entered into this Agreement to assure the Company's performance of this
Agreement together with the Company;
C. The Consultant is an independent contractor and is not an employee of,
partner or joint venturer with the Company;
D. The Company has also requested that the Consultant enter into reasonable
confidentiality provisions, and the Consultant has agreed to do so, to specify
the obligations of confidentiality which the Consultant has agreed to accept as
a condition of the Consultant being engaged to perform the Services.
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THIS AGREEMENT WITNESSES THAT in consideration of the premises, and other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
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In this Agreement, including the recitals and any schedules, the following
words and expressions have the following meanings unless the context otherwise
requires:
(a) "Confidential Information" means all information or data which may
before or after the date of this Agreement be delivered to the
Consultant by the Company or by any affiliate of the Company or which
may otherwise come within the knowledge of the Consultant or which may
be developed by the Consultant or any subsidiary or affiliate of the
Consultant or any employee of any of them in connection with the
Services or from any of the other Confidential Information and all
documents delivered by the Company or any affiliate of either of them
which are marked as confidential or as proprietary information.
(b) "Services" means all services which the Consultant may provide from
time to time for the Company including, without limitation, those
provided in Schedule "A" hereto. In connection with such services, the
Consultant may supply ancillary services, work-product or related
goods or materials, tangible or intangible, and the term "Services"
shall also comprise all such matters and items.
1.2 ENTIRE AGREEMENT
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This Agreement supersedes all previous invitations, proposals, letters,
correspondence, negotiations, promises, agreements, covenants, conditions,
representations and warranties with respect to the subject matter of this
Agreement. There is no representation, warranty, collateral term or condition
affecting this Agreement for which any party can be held responsible in any way,
other than as expressed in writing in this Agreement.
1.3 AMENDMENTS
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No change or modification of this Agreement will be valid unless it is in
writing and signed by each party to this Agreement.
1.4 INVALIDITY OF PARTICULAR PROVISION
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It is intended that all of the provisions of this Agreement will be fully
binding and effective between the parties. In the event that any particular
provision or provisions or a part of one or more is found to be void, voidable
or unenforceable for any reason whatsoever, then the particular provision or
provisions or part of the provision will be deemed severed from the remainder of
this Agreement. The other provisions of this Agreement will not be affected by
the severance and will remain in full force and effect.
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1.5 GOVERNING LAW
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This Agreement will be governed by and construed in accordance with the
laws of the Province of British Columbia and the laws of Canada applicable in
such Province, except without resort to the laws of such Province with respect
to conflicts of law.
ARTICLE 2
REMUNERATION
2.1 REMUNERATION
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The remuneration of the Consultant shall be at the rates and on the terms
specified in Schedule "B" hereto. As required by applicable law throughout the
Term, in addition to all amounts payable by the Company under this Agreement,
upon such remuneration with respect to the Services or with respect thereto, the
Company shall also pay and be responsible for (as the Consultant may direct and
require from time to time) all Social Services Tax, Goods and Services Tax,
Harmonized Sales Tax and all other sales, use, commodity, transaction,
value-added and all other such taxes, as applicable. Without limiting the
foregoing provisions, the Company acknowledges and agrees that it is intended
that such remuneration described above, the expenses described in section 2.2
and all other remuneration, expenses, costs, charges, outlays shall be
completely net, except as shall be otherwise provided in the specific provisions
contained in this Agreement, and that the Consultant shall not be responsible
during the Term for any costs, charges, expenses, and outlays of any nature
whatsoever arising from or relating to the goods or Services supplied under this
Agreement and the Company pay, indemnify and hold the Consultant harmless for
and with respect to all charges, impositions and costs of every nature and kind
relating to this Agreement whether or not referred to herein and whether or not
within the present contemplation of the Consultant and the Company.
2.2 EXPENSES
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The Consultant shall be reimbursed for all reasonable out-of-pocket
expenses, costs, charges or outlays (collectively, "expenses") actually and
properly incurred by it in connection with its duties hereunder provided that
the Consultant first furnishes statements and vouchers for all such expenses to
the Company. As an agreed reasonable administrative, overhead and handling
charge, in addition to the actual amount of such expenses to be reimbursed as
set out in the immediately preceding sentence, the Consultant shall be entitled
to mark up any or all of such expenses, at its discretion from time to time, by
an additional 15%. Accordingly, the Company shall pay the Consultant 115% of
such expenses, as the Consultant requires. Unless otherwise specifically
provided in Schedule "B", the Consultant will be also reimbursed by the Company
for all reasonable expenses necessarily and actually incurred by the Consultant
in the performance of the Services. The Consultant will from time to time
submit to the Company detailed invoices and supporting documentation acceptable
to the Company, acting reasonably. The Consultant will invoice the Company for
such expenses. All such invoices will be payable by the Company within 30 days
of the date of each such invoice.
2.3 CONSULTANT NOT EMPLOYEE
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The parties agree that the Consultant and employees of the Consultant are
not employees of the Company and, as such, save as required by law, there shall
be no deductions for any statutory withholdings such as income tax, Canada
Pension Plan, Employment Insurance or Workers' Compensation.
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2.4 STATUTORY WITHHOLDINGS
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The Consultant agrees to make and remit all statutory withholdings as may
be required by it in respect of the Consultant's employees, if any, who may be
involved in performance of the Services for the Company. At the request of the
Company, the Consultant shall provide to the Company satisfactory evidence of
such statutory withholdings having been made.
2.5 NO PARTNERSHIP
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This Agreement will not be construed as creating a partnership, joint
venture or agency relationship between the parties or any other form of legal
association which would impose liability upon one party for any act or failure
to act by the other party.
2.6 CHOICES OF SUPPLIER
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Throughout the Term, the Company hereby appoints the Consultant as the
Company's sole and exclusive supplier of the Services. With respect to each and
every opportunity to supply or provide, directly or indirectly, such Services,
the Company grants to the Consultant the first opportunity and a continuing
right of first refusal to so supply or provide the Services, throughout the
Term.
ARTICLE 3
CONFIDENTIALITY
3.1 GENERAL OBLIGATION OF CONFIDENTIALITY
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The Consultant acknowledges that the Confidential Information consists
entirely of information and knowledge which is the exclusive property of the
Company or its subsidiaries and affiliates or persons from whom the Company has
obtained its rights. The Consultant will treat the Confidential Information
obtained by it in strict confidence and will not disclose the Confidential
Information made available to it unless otherwise required by law, except as
previously approved in writing by the Company. The Consultant will protect such
Confidential Information from disclosure by exercising a standard of care as may
reasonably be expected to preserve its secret and confidential nature. All
documents containing Confidential Information are the property of the Company.
Without limiting the generality of the foregoing, the Consultant hereby
transfers to the Company (forever, royalty-free and free and clear of all other
charges, liens, encumbrances and all other claims whatsoever) the entirety of
the property rights in all documents and storage media of every kind which now
or hereafter may contain the Confidential Information.
3.2 USE OF CONFIDENTIAL INFORMATION
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The Consultant will not use the Confidential Information for any purpose
other than as contemplated by this Agreement.
3.3 PROHIBITION ON COPYING
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The Consultant will not copy, modify or part with the Confidential
Information except with the written approval of the Company, except that the
Consultant is permitted to make a reasonable number of copies of the
Confidential Information for the specific purposes authorized by this Agreement.
All such copies remain the sole property of the Company.
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3.4 OFFICERS AND EMPLOYEES
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The Consultant may disclose the Confidential Information only to those of
its officers, employees and sub-contractors whose duties require them to know
the same. The Consultant will notify such officers, employees and
sub-contractors of the obligations contained in this Agreement with respect to
confidentiality and restrictions on its use. If requested by the Company, the
Consultant will require such officers, employees and sub-contractors to whom
Confidential Information is disclosed to execute and to deliver to the Company
the written agreement of each such officer, employee and sub-contractor to be
bound personally by all of the terms and conditions of this Agreement, such
agreement to be in a form and on terms satisfactory to the Company, acting
reasonably. The Consultant will require and direct such officers, employees and
sub-contractors to exercise a standard of care sufficient to preserve the
confidential nature of the Confidential Information.
3.5 EXCEPTIONS
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Any obligations specified in this Article will not apply to the following:
(a) any information which is presently in the public domain;
(b) any information which subsequently becomes part of the public
domain through no fault of the Consultant or any officer, director,
employee or agent of the Consultant; or
(c) any information which is required to be disclosed by a court or
authority of competent jurisdiction.
3.6 INJUNCTIVE RELIEF
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The Consultant acknowledges that irreparable harm may result to the Company
if the Consultant breaches its obligations under this Article. The Consultant
acknowledges that such a breach may not properly be compensated by an award of
damages. Accordingly, the remedy for any such breach may include, in addition
to other available remedies and damages, specific performance, injunctive relief
or other equitable relief enjoining such breach at the earliest possible date.
ARTICLE 4
GENERAL OBLIGATIONS OF THE CONSULTANT
4.1 THE COMPANY'S OWNERSHIP OF RIGHTS
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The Consultant acknowledges and agrees as follows with respect to the
ownership of rights by the Company and the limitation of the Consultant's
rights:
(a) Nothing contained in this Agreement shall be construed as an
assignment to the Consultant of any right, title or interest in the
Confidential Information. All right, title and interest relating to
the Confidential Information is expressly reserved by the Company.
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<PAGE>
(b) The Consultant acquires no rights in any inventions, patents,
application patents, copyrights, industrial designs, developments or
other work products, including, but not limited to, documents,
formulae, written materials, programs, designs, systems, regardless of
storage media or depiction (collectively, the "Work Products")
resulting from, derived from or otherwise related to the performance
of the Services by the Consultant or the Confidential Information. All
such inventions, patents, application patents, copyrights, industrial
designs, developments and Work Products are now and on inception are
and in every case shall remain the sole property of the Company. The
Consultant will promptly and duly execute and deliver and cause its
officers and employees to promptly and duly execute and deliver to the
Company such further documents and assurances and take such further
action as the Company may from time to time request in order to more
effectively carry out the intent and purpose of this section, and to
establish and protect the rights, interests and remedies of the
Company.
(a) The Consultant will not and the Consultant will cause its officers and
employees not to at any time apply for any copyright, trade mark,
patent, or other intellectual property protection which would affect
the ownership by the Company of any rights in the intellectual
property associated with the Confidential Information or the Work
Products or file any document with any government authority anywhere
in the world or take any other action which could affect such
ownership of any intellectual property associated with the
Confidential Information or the Work Products or aid or abet anyone
else in doing so.
ARTICLE 5
GENERAL INDEMNITIES FOR BREACH
5.1 INDEMNITY BY CONSULTANT
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Without limiting the indemnities and holdings harmless elsewhere in this
Agreement, the Consultant will defend, indemnify and save harmless the Company
from and against all actions, proceedings, demands, claims, liabilities, losses,
damages, judgments, costs and expenses including, without limiting the
generality of the foregoing, legal fees and disbursements on a solicitor and his
own client basis (together with all applicable taxes) which the Company may be
liable to pay or may incur by reason of or caused or contributed to by a breach
by the Consultant of any of the terms of this Agreement or any liability that
the Company may incur to any authority for source deductions, remittance of
goods and services tax collected by the Consultant and any other remittance
obligations of the Consultant arising with respect to payment to the Consultant
pursuant to this Agreement.
5.2 INDEMNITY BY COMPANY AND PARENT
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Without limiting the indemnities and holdings harmless elsewhere in this
Agreement, the Company and the Parent will jointly and severally defend,
indemnify and save harmless the Consultant from and against all actions,
proceedings, demands, claims, liabilities, losses, damages, judgments, costs and
expenses including, without limiting the generality of the foregoing, legal fees
and disbursements on a solicitor and his own client basis (together with all
applicable taxes) which the Consultant may be liable to pay or may incur by
reason of or caused or contributed to by a breach by either or both of the
Company or Parent of any of the terms of this Agreement.
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<PAGE>
ARTICLE 6
TERM & RENEWAL
6.1 This Agreement will take effect on the Effective Date and will continue
in full force and effect for the term (the "Term") as follows. The initial Term
shall be for FIVE (5) consecutive years starting on the Effective Date. The
second, third and all successive renewals of the Term shall be effected
automatically on the elapse of the then-current Term, without the action of
anyone, subject to the right of the Company in each Term to provide specific
written notice to the Consultant that the then-current Term shall be ended,
provided such written notice shall be given not more than SIX (6) and not less
than FIVE (5) months prior to the date on which the then-current Term would end
and otherwise have been automatically renewed. In circumstances where such
written notice has been duly and validly given, the then-current Term shall end
on that date on which the then-current Term would have otherwise have been
automatically renewed and, for greater certainty, thenceforth there shall be no
further rights of nor automatic renewal.
6.2 Notwithstanding any other provision of this Agreement, the Consultant
solely may, at any time during the Term, give one month's advance written notice
to the Company of its intention to terminate this Agreement and on the
expiration of such period of written notice the provision of the Services to be
performed under this Agreement shall terminate. Such notice may expire on any
day of the month and any remuneration payable hereunder shall be proportioned to
the date of such termination.
6.3 The Company agrees to indemnify and save harmless the Consultant in
respect of all claims for bodily injury or death, property damage, intellectual
property infringement and for every other loss or damage arising from the
conduct of any work by or any act or omission of the Consultant or any assignee,
subtenant, agent, employee, contractor, invitee, or licensee of the Consultant,
and in respect of all costs, expenses, and liabilities incurred by the
Consultant in connection with or arising out of all such claims, including the
expenses of any action or proceeding pertaining thereto. This indemnity and
all other indemnities, holding harmless and other obligations of the Company in
or pursuant to this Agreement shall forever survive the expiry or termination of
this Agreement.
ARTICLE 7
GENERAL
7.1 ARBITRATION
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All disputes arising out of or in connection with this contract, or in
respect of any defined legal relationship associated therewith or derived
therefrom, shall be referred to and finally resolved by arbitration under the
Rules of the British Columbia International Commercial Arbitration Centre. The
appointing authorities shall be the British Columbia International Commercial
Arbitration Centre. The case shall be administered by the British Columbia
International Commercial Arbitration Centre in accordance with its "Procedures
for Cases Under the BCICAC Rules". The place of arbitration shall be Vancouver,
British Columbia, Canada.
7.2 NOTICES
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Any notice, direction, request or other communication required or
contemplated by any provision of this Agreement shall be given in writing and
shall be given by delivering the same to the Company or the Consultant or
Parent, as the case may be, as follows:
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(a) To the Consultant at:
At the address noted on the first page of this Agreement
to the attention of its President and marked "Urgent",
(b) To the Company or to the Parent, as the case may be,
to the attention of its President, at and in care of,
marked "Urgent":
Ogden Murphy Wallace, PLLC
1601 Fifth Avenue
Suite 2100
Seattle, Washington 98101-1686
Any such notice, direction, request or other communication shall be deemed to
have been given or made on the date on which it was delivered or, in the case of
fax (at such fax number(s) as may hereafter be provided by notice hereinbefore
provided), on the next business day after receipt of transmission. Either party
may establish or change its fax number or change its address for service from
time to time by notice in accordance with the foregoing.
7.3 ASSIGNMENT
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This Agreement is not assignable in whole or in part by the Company without
the prior written consent of the Consultant. Any attempt to assign any of the
rights, or to delegate any of the duties or obligations of this Agreement
without such written consent is void. Any such change which might occur without
such consent or any assignment occurring by reason of operation of law such as
upon a bankruptcy or amalgamation shall be deemed an event of default under this
Agreement.
7.4 OBLIGATIONS OF THE PARENT
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Each and every representation, warranty, covenant, agreement and other
obligation of the Company made in this Agreement or to be made pursuant to this
Agreement is hereby deemed to be and is hereby made jointly and severally by the
Parent together with the Company, as direct, joint and several representations,
warranties, covenants and agreements of the Parent and the Company. All
provisions in this Agreement applicable to or referring to the Company shall
also be applicable and shall be deemed to refer also to the Parent, mutatis
mutandis. For greater certainty, the Parent is not the surety nor guarantor of
the Company with respect to this Agreement but a direct, joint and several
obligor to and in favour of the Consultant.
7.5 PROFESSIONAL ADVICE
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Each party executing this Agreement has consulted with and has been fully
and properly advised by his or its respective legal counsel, before entering the
settlement contained or referred to herein, and has executed and delivered this
Agreement as its fully-informed and voluntary act and deed, without threat or
compulsion by or on behalf of any other party hereto nor any other person. Each
party confirms and agrees that it has been duly advised (and fully and fairly
informed with respect to such matters) to obtain all necessary and independent
accounting, taxation, legal, financial and other applicable professional advice
and counsel in all applicable jurisdictions prior to entering to this Agreement
and the obligations referenced herein. Each such party has either obtained all
such advice and counsel or has determined to its own satisfaction, having been
fully and fairly informed therein, not to seek such advice and counsel.
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7.6 WAIVER
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No failure or delay on the part of any party in exercising any power or
right under this Agreement will operate as a waiver of such power or right, nor
will any single or partial exercise of any such right or power preclude any
further or other exercise of such right or power under this Agreement. No
modification or waiver of any provision of this Agreement and no consent to any
departure by any party from any provision of this Agreement will be effective
unless it is in writing. Any such waiver or consent will be effective only in
the specific instance and for the specific purpose for which it was given. No
notice to or demand on any party in any circumstances will entitle such party to
any other or further notice or demand in similar or other circumstances.
7.7 ENUREMENT
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Subject to the restrictions on transfer or assignment contained in this
Agreement, this Agreement shall enure to the benefit of and be binding on the
parties and their respective successors and assigns.
IN WITNESS WHEREOF the parties have duly executed and delivered this Agreement.
THERMO ENZYME PRODUCTS INC. by its
/S/ Rene J. Branconnier
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Authorized Signatory
DURO ENZYME SOLUTIONS INC. by its
/S/ Rowland Wallenius
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Authorized Signatory
DURO ENZYME PRODUCTS INC. by its
/S/ Rowland Wallenius
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Authorized Signatory
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SCHEDULE "A"
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SERVICES
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On an as needed basis, the Consultant covenants and agrees with the Company to
provide the following Services from time to time, as required, at or about
Langley, British Columbia or at such other locations as may be mutually agreed
between the Consultant and Company in writing:
Research & Development
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- Plan/set-up research & development programs to develop, advance and
promote the Company's unique technologies, processes and products
- Provide analytical and technical support services
- Assist in day-to-day management of research & development personnel
- Assist in day-to-day operations of research & development facilities
- Assist in protection of Company's technology, processes and products by
writing or contributing to the preparation of formal records of invention,
intellectual property reports, and/or patents
- Liaise with Corporate management, lawyers, other consultants and
professionals, as appropriate and as may be necessary, in the development
and promotion of the Company's unique technologies, processes and products
- Advise on analytical and technical matters
- Research technological developments in the field and advise Company
management of developments which may impact on the Company and/or its
unique technologies, processes and products
Consulting
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- Assist in writing and reviewing marketing literature relating to promotion
of the Company's unique technologies, processes and products
- Assist in matters of Corporate administration
- Review and advise the Company on funding opportunities
- Assist in hiring technical, administrative and management personnel
- Promote the Company, its unique technologies, processes and products at al
times
Design
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- Review plans/drawings for facilities delivering the Company's
technologies, processes and/or products
- Advise on matters relating to design/setup or pilot and commercial
operations
- Advise on equipment and systems specifications
Other
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- Assist or contribute to all and any other matters, as called upon from
time to time, that relate to Company operations, support and/or promotion
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SCHEDULE "B"
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REMUNERATION
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The remuneration of the Consultant for the Services and Expenses shall be in the
amounts and at the rates, payable by the Company to the Consultant, as follows:
<TABLE>
<CAPTION>
TYPE OF SERVICES OR EXPENSES REMUNERATION DUE DATE FOR PAYMENT
<S> <C> <C>
Services, as set out in At the standard rates per day or Upon presentation of invoices
Schedule "A" hour of the Consultant which the by the Consultant
Consultant may establish from
time to time.
Expenses, as set out in Cost plus 15% as set out in Upon presentation of invoices
Section 2.2 of the Agreement Section 2.2 of the Agreement by the Consultant
</TABLE>
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