Exhibit 10.1
LICENCE AGREEMENT
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THIS AGREEMENT made as of the 28 day of March, 2000.
BETWEEN:
THERMO TECH BIO CONVERSION INC., a company incorporated under the laws
of the Province of British Columbia and having its principal place of
business located at 2380 Brampton Street, Hamilton, Ontario, L8E 5V9
(herein referred to as the "Company")
OF THE FIRST PART
AND:
PLANET EARTH OPERATING SERVICES INC., a company incorporated under the
laws of Canada and having its principal place of business located at
20436 Fraser Highway, Langley, BC V3A 4G2
(herein referred to as the "Licensee")
OF THE SECOND PART
WHEREAS:
A. The Company is the owner of a certain technological process (and certain
patents, know-how, trade secrets and trade names) relating to the digestion of
biodegradable waste, which technological process is called "Thermophilic,
Aerobic Fermentation of Organic Waste", and which technological process is
described in patent number US 5,810,903 and all developments, manuals,
literature, reports, technical information created in relation to such process
to create its proprietary systems known as Mark II Thermo Master and Mark III
Thermo Master (such technological process together with the related trade
secrets, know-how and trade names as well as any and all successive improved
systems hereafter developed being hereinafter collectively referred to as the
"Process");
B. The Company is also the authorized user of certain digesters and
supporting equipment (collectively called the "Equipment"), which digests
biodegradable waste, and produces an end product which may be commercially
utilized; and
C. The parties wish that the Company grant a license to the Licensee to
utilize the Process and to operate a Plant and use the Equipment in the
Designated Territory (as hereinafter defined) on the terms and conditions
hereinafter set forth.
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NOW THEREFORE in consideration of the provisions and mutual covenants herein
contained, the parties hereto agree as follows:
1. INTERPRETATION
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1.1 Definitions
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In this agreement and in any schedules or amendments hereto, the following
terms shall have the following meaning:
(a) "Affiliate" has the meaning set forth in subsections 1 (1) and (2) of
the British Columbia Company Act;
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(b) "Designated Territory" means Canada and the American states of
Washington, Oregon, California, Nevada, Iowa and Hawaii;
(c) "Effective Date of this Agreement" means the date first appearing on
page one hereof;
(d) "End Products" means fertilizers, animal feed supplements, human food
supplements or any other commercially valuable products created from
the application of the Process to biodegradable food wastes;
(e) "Equipment" has the same meaning as in Recital B herein;
(f) "Equipment and Design Criteria Operations Manual" means the Company's
standard manual relating to the Equipment and the Process as the same
may be amended by the Company from time to time;
(g) "Excluded Uses" means the use of the Process or Equipment in
connection with any use other than food waste, municipal sludge or
sewage water, or agricultural waste of agricultural manure.
(h) "Gross Revenue" means all revenue received or accrued by the Licensee
or any other party deriving its rights from or through the Licensee
from any source earned from the application of the Process or the
Equipment that utilizes the Process including, without limitation,
revenues from tipping fees or other such front end charges, revenues
from the sale, construction, rent, lease, processing charges or other
use of engineering, technology, facilities and from any other use of
the Process or Equipment within the Designated Territory, and from the
sale of End Products produced from the application of the Process
within the Designated Territory, including the value of all End
Products produced by the Lincensee or all of the users authorized by
the Licensee of the Process within the Designated Territory, but shall
not include customer refunds, adjustments, sales taxes or other taxes
collected from customers by the Licensee for transmittal to the
appropriate taxing authority;
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(i) "Gross Revenue Royalty" means a royalty equal to five percent (5%) of
Gross Revenue.
(j) "Laws" means all applicable laws, regulations, by-laws, codes,
orders-in-council, or other governmental provisions, however
designated, whether deferral, provincial, state, regional or local,
and whether legislative, judicial or administrative in origin,
including without limitation all requirements and conditions, however
designated, under all permits or certificates of approval applicable
at any time to the Plant. The term "Laws" is also deemed to include
all relevant codes, standards, guidelines and criteria of professional
engineering societies, institutes or associations applicable to any
part of a Plant as well as those of underwriters and fire prevention
bodies.
(k) "Licence Fee" means One Million U.S. Dollars (US $1,000,000.00) up
front fixed fee, due on execution, plus the sum of One Million U.S.
Dollars (US $1,000,000.00) for every Plant constructed by or on behalf
of the Licensee or any other party deriving its rights from or through
the Licensee;
(l) "Net Income" means the net income, calculated in accordance with
generally accepted accounting principles, on a full accrual basis,
before deducing taxes, depreciation and amortization, earned by the
Licensee or any other party deriving its right form or through the
Licensee from any source earned from the application of the Process or
the Equipment that utilizes the Process;
(m) "Net Income Royalty" means a royalty equal to ten percent (10%) of Net
Income;
(n) "Plant" means a Thermo Master TM Mark III thermophilic digestion plant
consisting of one or more pieces of the Equipment;
(o) "Process" means the technological process described in Recital "A" to
this Agreement together with the certain patents, trade secrets,
know-how and trade names referred to therein; and
(p) "Trade Marks" includes Thermo Master TM, Thermo-Pro TM and all other
insignia, labels, slogans and other identification schemes, trade
marks, service marks, trade names and applications therefore that may
be owned now or hereafter or used from time to time by the Company in
association with the Process or the Equipment.
2. SUPERVISION BY COMPANY
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2.1 Right to Supervise
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The Company or the Company's agent shall have the right, but not the
obligation, at its own expense, to supervise or inspect the operation of any
Plant in the Designated Territory so as to ensure that all of the Company's
specifications and standards have been met.
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3. APPOINTMENT AS LICENSEE
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3.1 Grant of Licence Rights
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Subject to the provisions herein and for the duration of this Agreement,
the Company hereby grants to the Licensee the exclusive right and licence to
utilize and apply the Process and operate the Plant within the Designated
Territory. The Licensee's exclusive rights are subject to any Plant, the
construction of which commenced prior to the Effective Date of this Agreement.
3.2 Prohibitions
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The Licensee agrees that, except with the prior written consent of the
Company, it will not:
(a) construct or contract for the construction of any Equipment outside of
the Designated Territory;
(b) sell any Equipment to any person who is likely to use the Equipment
outside of the Designated Territory;
(c) solicit customers for the application of the Process outside the
Designated Territory nor establish or maintain branches or warehouse
for delivery purposes outside the Designated Territory; and
(d) use a Plant and the Process, or allow a Plant and the Process to be
used, in conjunction with any Excluded Use.
3.3 Sub-Licensing
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Other than a sub-licence to a related company that is controlled by the
Licensee and which sub-licence will only be effective for so long as the
Licensee continues to control such related company, the Licensee is not
authorized to grant sub-licenses without the prior written consent of the
Licensee, which consent may be withheld in the Company's sole discretion. The
Licensee will forthwith deliver a copy of any sub-licence to the Company.
3.4 Performance Requirement
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If, in any year, following the first anniversary date of this Licence, the
Licensee does not build and commence operation of at least one (1) Plant in the
Designated Territory, the Licensee will cease to have any rights to construct
new Plants in the Designated Territory and the Licensee shall have no further
rights under this Licence except in respect of Plants already constructed by or
on behalf of the Licensee in the Designated Territory.
4. LICENCE FEE AND ROYALTY PAYMENTS
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4.1 Licence Fee
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The Licence Fee shall be paid by the Licensee to the Company upon
commencement of construction of a Plant by or on behalf of the Licensee, except
that the up front portion of the Licence Fee shall be paid on execution or as
the parties may agree.
4.2 Royalties
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As further consideration for the licence rights hereby granted, the
Licensee shall pay to the Company the Gross Revenue Royalty and the Net Income
Royalty. The Gross Revenue Royalty and the Net Income Royalty shall be paid to
the Company on a quarterly basis within thirty (30) days of the completion of
each fiscal quarter of the Licensee.
4.3 Financial Statements
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The Licensee shall provide to the Company audited financial statements and
other documentation disclosing the amount of Gross Revenues and the Net Income
from the use of the Process. The audited financial statements and other
documentation shall be delivered to the Company within one hundred and twenty
(120) days of the Licensee's fiscal year end. The Licensee shall grant, and
does hereby grant, to the Company the right to have its duly authorized
representatives attend at the premises of the Licensee during normal working
hours to examine all financial records of the Licensee for the purpose of
verification of the Gross Revenues and Net Income, as and when the Company
advises the Licensee in writing of its intention to seek such access. The
Company shall deliver to the Licensee written notice of its desire to review the
Licensee's financial records relating to this Agreement, which written notice
shall be delivered to the Licensee no less than three (3) business days prior to
the date of such review by the Company, which review shall be at the expense of
the Company. The Company shall only have the right to conduct such a review two
times during any twelve (12) month period.
4.4 Adjustment
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The parties hereto agree that within thirty (30) business days of the
delivery of the audited financial statements and other relevant documentation,
the parties shall, if required, adjust the amount of the royalty payments paid
by the Licensee to the Company pursuant to Section 4.2 herein. If the Licensee
has overpaid the Company, the Company shall reimburse the Licensee within thirty
(30) days of receipt of notice of such overpayment. If the Licensee has
underpaid the Company, the Licensee shall pay the Company the amount of such
underpayment within thirty (30) days of receipt of notice of such underpayment.
4.5 Payments Generally
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All sums payable by the Licensee to the Company hereunder shall:
(a) be paid when due hereunder without prior demand therefore and without
any set-off, compensation or deduction whatsoever; and
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(b) if not paid when due, bear interest at a rate equal to the prime rate
of interest charged by Royal Bank of Canada, Vancouver Main Branch,
plus six percent (6%) per annum, all without prejudice to any other
right or remedy of the Company.
4.6 Computer System
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The Licensee will, at the Licensee's expense, install, utilize and maintain
a computerized accounting system which allows remote access by the Company. All
records of the Licensee shall be maintained on such system and the Company will
be allowed unlimited access to the same.
5. COVENANTS OF LICENSEE
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5.1 Conduct of Business
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The Licensee agrees that it shall conduct its business, and shall cause its
employees to conduct themselves, in compliance with all applicable laws, rules
and regulations of each jurisdiction within the Designated Territory and the
Licensee shall maintain such insurance against public liability, loss or damage,
and/or against product liability, loss or damage, in the manner of a reasonable
businessman and in accordance with Section 5.5 hereof. The Licensee also agrees
to operate the Plant on a basis that is consistent with the highest industry
standard to ensure the highest possible economic return to the Licensee and the
Company. The Licensee agrees that, subject to the terms hereof, it shall be
solely responsible for the hiring, compensation, termination and all other
matters relating to any persons, companies or corporations employed by the
Licensee, for any reason whatsoever, and shall indemnify the Company against any
injuries, actions or proceedings arising from the employment of such persons
and/or companies. The Licensee shall indemnify the Company, its agents,
servants and employees against all claims, losses and/or expenses, including
reasonable attorney's fees, arising out of performance of the Licensee's
business, that are caused in whole or in part by the Licensee's negligent acts
or omissions, or the negligent acts or omissions of anyone employed by the
Licensee for whose acts the Licensee is or may be liable.
5.2 Company Policies
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The Licensee agrees at all times and at its own expense (waiving all rights
to compensation or remuneration therefore from the Company or Affiliated
companies) to comply with the Company's reasonable policies as made known from
time to time to the Licensee regarding operating and maintenance procedures and
systems relating to the Process. The Company will deliver, from time to time,
to the Licensee, updates of such policies.
5.3 Use of Facilities
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The Licensee agrees that the Company may from time to time have access to
any Plant in the Designated Territory for advertising and demonstration
purposes, and the Licensee covenants and agrees to provide all reasonable
assistance to the Company in respect thereof. The Company shall have the right
to have visitors conducted through a Plant by the Licensee's employees or
agents, subject to any and all reasonable rules or regulations pertaining to
visits. If the Company is showing a Plant to any visitors, the Company shall be
responsible, except where the Licensee is found to have been negligent, for all
damages resulting from injuries to the visitors and all damage to a Plant caused
by such visitors. Any such showing of a Plant to visitors by the Company shall
be done in such a way as not to hinder or impede the work taking place in a
Plant by the Licensee and its employees and representatives.
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5.4 Indemnity
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The Licensee shall at all times indemnify and save harmless the Company
(including its directors, officers, agents and employees), of and from all
losses and damages and all actions, claims, costs, demands, expenses, fines,
liabilities and suits of any nature whatsoever for which the Company shall or
may become liable, incur or suffer by reason of a breach, violation or
non-performance by the Licensee of any covenant, term or provision of this
Agreement or by reason of any wrongful act or omission, default or negligence on
the part of the Licensee or any of its agents, contractors, employees, invitees
or licensees.
5.5 Licensee's Insurance
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The Licensee shall, during the term of this Agreement in respect of each
Plant in the Designated Territory, take out and maintain in such form and with
such companies as the Company may reasonable approve, comprehensive general
liability insurance in the joint name of the Licensee and the Company for an
amount of not less than Five Million U.S. Dollars (US $5,000,000.00) combined
single limit or such other amount as may be reasonable required by the Company
from time to time.
6. COVENANTS OF COMPANY
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6.1 Technical Support
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The Company agrees to assist the Licensee in the marketing of the Process in the
Designated Territory by:
(a) ensuring that sales brochures and other literature relating to the
Process are made available at reasonable cost to the Licensee; and
(b) acquainting the Licensee with such new methods of selling and new
applications for the Process as may be recommended by the Company.
The Company will, when requested by the Licensee, but at the Company's
convenience and in accordance with the Company's scheduling requirements,
provide technical advice and support for the planning, construction,
commissioning and operation of Plants in accordance with this Agreement,
provided that the Licensee shall pay to the Company, in advance, an amount equal
to the Company's costs of providing the same, as determined by the Company,
acting reasonably, plus fifteen percent (15%).
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6.2 Canadian Plants
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To the extent that the Company has any right to do so, the Company will,
for the purposes of the Licensee's marketing, allow the Licensee to tour the
Plants currently in existence in Richmond, British Columbia, and Hamilton,
Ontario.
6.3 Representations and Warranties of the Company
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The Company represents and warrants to the Licensee that:
(a) the execution and delivery of this Agreement and the exercise of the
rights granted herein will not result in a breach of any term or
provision of or constitute a default under or conflict with any
agreement, judgment, decree, court order or other instrument to which
the Company is a party or by which it is bound;
(b) the Process will have the effectiveness claimed in the Company's
Equipment and Design Criteria Operations Manual and will produce a
marketable product and, upon written notice from the Licensee that the
Licensee plans to proceed with the construction of a Plant, the
Company will provide the Licensee with the then most current version
of such manual; and
(c) the Company has the right to grant this Licence,
and hereby acknowledges that the Licensee is relying upon these
representations and warranties in entering into the Agreement and proceeding
with the development of Plants as contemplated herein.
6.4 Limitation on Company's Representations and Warranties
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The Licensee acknowledges and agrees that the representation and warranty
given in Section 6.3 will not be effective in respect of a particular Plant
unless the Licensee's operator is trained by the Company or its nominee, the
Plant is commissioned by the Company or its nominee and the Plant is operated
and the Process is utilized by the Licensee in accordance with the
specifications provided by the Company or its agents unless otherwise agreed to
by the parties.
7. TRADE MARKS, INVENTIONS AND CONFIDENTIAL INFORMATION
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7.1 Use of Trade Marks
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The Licensee shall have the right during the continuance of this Agreement
and subject to due compliance with the provisions of this Agreement and to the
execution of such further documents relating to the use of Trade Marks as the
Company may reasonably request, to use the Company's Trade Marks in marketing
the Process within the Designated Territory and for the purpose of describing
itself as an official licensee of the Company and as authorized to utilize the
Process.
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7.2 Conditions of Use
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The Licensee agrees:
(a) to comply with all reasonable instructions issued by the Company
relating to the form and manner in which the Company's Trade Marks
shall be used and to discontinue immediately upon notice from the
Company any practice relating to the use of the Company's Trade Marks
which in the Company's opinion would or might adversely affect the
rights or interests of the Company or any Affiliate of the Company;
and
(b) not to contest the title of the Company (or any Affiliate company or
any person from whom the Company obtained its rights to the Process)
to any Trade Marks, trade names, copyrights, patents or any other form
of proprietary right in connection with the Process or the Equipment,
not to effect any registrations thereof, and not to take any action to
the detriment of their respective interests therein.
7.3 Disclosure of Improvements
----------------------------
The Licensee shall promptly disclose to the Company for its ongoing use and
the use of its licensees, all particulars of any improvement or further
invention applicable to any of the Process or Equipment which is made or
discovered by the Licensee or any of its employees or agents, or which comes to
the Licensee's knowledge (whether or not the same be patented or patentable).
The Company shall disclose any Improvements, when made or developed from time to
time hereafter, to the Licensee for its ongoing use and the use of its permitted
licensees, if any. For the purposes of this paragraph, "Improvements" means any
and all improvements, enhancements, changes and modifications discovered or made
by the Company to the Process, patents, know-how and related materials and
documentation and only as these Improvements relate to the patents referred to
in Recital A herein and only in regard to the applications of the Process or
Equipment specifically licensed to the Licensee pursuant to this Agreement.
7.4 Title to Improvements
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All future improvements, changes or developments in and/or to the Equipment
or the Process, whether such improvements, changes or developments are designed
or created by the Company or the Licensee or its employees or agents shall be
the property of the Company. Any improvements, changes or developments relating
to the Equipment or the Process, which may be designed or developed yb the
Licensee or its employees or agents, shall not be employed and/or used by the
Licensee or its permitted assigns without prior approval by the Company's
designated engineers or other nominees, such approval not to be unreasonably
withheld. The Licensee shall promptly provide to the Company written notice of
the proposed improvements or developments.
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7.5 Confidential Information
-------------------------
The Company and the Licensee acknowledge and agree with each other that ll
information connected with the Process and the Equipment, including without
limitation, all information, (whether or not it is in the public domain) data,
inventions, discoveries, improvements, modifications, developments, technical
manuals, or process-flow manuals and data is confidential, and the Licensee and
the Company covenant and agree with each other to use their best efforts to
ensure that such information does not become public knowledge and undertake not
to disclose such information or any part thereof to any other person except to
their respective consultants, sub-contractors and employees as may be necessary
to carry out their respective rights and obligations under this Agreement, and
except as may be required for their respective financial reporting, income tax
or regulatory purposes. The Licensee shall, upon request from the Company and
at the cost of the Company, use the Licensee's best efforts to cause the
Licensee's employees and sub-contractors to testify on behalf of the Company in
any action or proceeding relating to the prosecution of any patent application
and its maturity into a patent or for the prosecution or defence of any patent
issued. The Licensee hereby further covenants and agrees with the Company that
the Licensee shall require each and every one of its directors, officer,
employees, consultants, or sub-contractors who are provided with any information
in respect of the operation of the Process or related knowledge to sign
confidentiality agreements with the Licensee and the Company which shall be in a
form acceptable to the company.
7.6 Litigation
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This Agreement shall not be void or terminated by reason only tat all or
any of the trade marks, trade names, patents, or trade secrets forming a part of
the Process or related know how are found to be unenforceable or invalid,
provided that if any such litigation results in the prohibition of the use of
the Process by the Licensee within the Designated Territory then this Agreement
shall terminate, provided that in no event shall the Company be liable for any
economic loss or loss of profits suffered by the Licensee or by anyone claiming
against or through the Licensee.
7.7 Non-Competition
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The Licensee shall not during the term of this Agreement and for a period
of five (5) years after its rights to construct further Plants terminate either
alone or in partnership or jointly or in conjunction with any person or persons,
including without limitation, any individual, firm, association, syndicate,
company, corporation or other business enterprise, as principal, agent,
shareholder, or in any other manner whatsoever, carry on or be engaged in or
concerned with or interested in or advise, lend money to , guarantee the debts
or obligations of or permit its name to be used or employed by any person or
persons, including without limitation, any individual, firm, association,
syndicate, company, corporation or other business enterprise, engaged in or
concerned with or interested in an operation or undertaking which is in any way
competitive with the business of the Company as it relates to the Process
without having obtained the express written consent of the Company. The
Licensee specifically acknowledges the geographical restriction contained herein
is reasonable and necessary due to the nature of the Company's Process and
Equipment.
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7.8 Infringement Defence
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The Company shall defend or settle, at its own expense, any claim, demand,
proceeding or action made or brought against the Licensee to the extent that the
claim, demand, proceeding or action is based on a claim relating to the
Company's ownership or authority to licence the Process and Equipment or any
part thereof to the Licensee, or that the manufacture, license, operation or use
of the Process and Equipment provided by the Company pursuant to this Agreement
infringes on any Canadian, United States or other patent rights, copyrights,
trade mark or service mark rights, or other intellectual or industrial
proprietary rights or constitutes a misappropriation of a trade secret or
confidential information or a disclosure of a trade secret or breach of
confidence of others.
7.9 Conditions on Infringement
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The defence, settlements and payments referred to in Section 7.8 herein are
expressly conditioned on the following:
(a) that the Company is notified promptly in writing by the Licensee of
any such claim, demand or action;
(b) that the Company is granted in writing sole control of the defence of
any such claim, demand or action and of all negotiation for its
settlement or
(c) that Licensee cooperates with the Company in a reasonable way to
facilitate the settlement or defence of the claim, demand or action;
and
(d) that the claim does not arise from modifications to the Process and
Equipment not authorized in writing by the Company or from the use or
combination of products provided by the Company with items provided by
Licensee or others or from any other action by the Licensee not
authorized by the Company.
8. TERM AND TERMINATION
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8.1 Commencement Date
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This Agreement shall be deemed to have come into effect on the Effective Date of
this Agreement.
8.2 Duration
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Unless sooner terminated under the provisions hereof, this Agreement shall
remain in force for a period of twenty (20) years from the Effective Date and
shall continue in force for as long as a Plant is operating in the Designated
Territory.
8.3 Termination by Company
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This Agreement may be terminated immediately by notice in writing given to
the Licensee by the Company:
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(a) if any change occurs in the constitution, management, control or the
financial or other circumstances of the Licensee which, in the
reasonable opinion of the Company is materially detrimental to the
interest of the Company, and in particular, without limiting the
generality of the foregoing, if any interest in the Licensee is
acquired by an entity engaged in any business related to the Process
which, in the opinion of the Company acting reasonably, is in
competition with the business of the Company or any Affiliate company;
(b) upon the insolvency, bankruptcy, dissolution or liquidation of the
Licensee;
(c) upon the failure of the Licensee to pay any sum owing to the Company,
provided that thirty (30) days written notice has been given to the
Licensee by the Company specifying the default;
(d) upon any other material default by the Licensee of the provisions
hereof provided that thirty (30) days written notice of default shall
have been given and provided further that if within such thirty (30)
day period the Licensee shall have taken all reasonable steps to cure
or remedy such default, then the Licensee shall not be deemed to be
indefault for as long as such reasonable efforts continue; or
(e) if any person in the Designated Territory becomes entitled through any
action of the Licensee to utilize the Process contrary to the terms of
this Agreement.
8.4 Termination by Licensee
-------------------------
The Licensee may terminate this Agreement at any time by giving to the
Company thirty (30) days advance written notice and paying the Company at the
end of the notice period any and all amounts due and owning to the Company
pursuant to this Agreement.
8.5 Results of Termination
------------------------
Upon the termination of this Agreement, howsoever occasioned:
(a) all rights granted by the Company to the Licensee shall immediately be
relinquished by the Licensee;
(b) the Licensee shall discontinue the use of and thereafter refrain from
using any of the Company's Trade Marks or any other trade marks, trade
names, designations and slogans owned or used by the Company and
thereafter take no action that would make it appear to the public that
the Licensee is still authorized to use the Process;
(c) any indebtedness of the Licensee to the Company or to any Affiliate
company shall become due and payable as at the effective date of
termination of this Agreement;
(d) the Licensee shall deliver to the Company or to a successor licensee
within the Designated Territory or other entity designated by the
Company, all price lists, bulletins, manuals, catalogues and other
literature and publications relating to sales and product information;
and
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(e) the Licensee shall cease using the Equipment and the Process.
8.6 Continuing Obligations
-----------------------
The termination of this Agreement, howsoever occasioned, shall be without
prejudice to any rights or obligations which shall have accrued prior to such
termination and shall not terminate or diminish the binding force or effect of
any of the provisions of this Agreement which are expressly or by implication
provided to come into force upon or continue in force after such termination,
including all obligations to pay any monies owning at the time of termination
and all provisions relating to confidentiality and non-competition.
8.7 No Liability
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Neither party shall be liable to the other for any compensation, loss or
damage arising from the termination of this Agreement in accordance with its
terms.
8.8 Deemed Assignment
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In the event of the insolvency, bankruptcy, dissolution or liquidation of
the Company then the interest of the Company in this Agreement shall thereupon
be deemed to have been assigned to Thermo Tech Technologies Inc.
8.9 Permitted Assignment
---------------------
Except as provided in Section 10.10, this Agreement may only be assigned by
the Licensee to European Themo Tech Technologies Inc., a company incorporated
under the laws of the United Kingdom and only upon such assignee entering into
an agreement directly with the Company to observe and perform all obligations of
the Licensee hereunder. No further assignment will be allowed other than as
provided in Section 10.10.
9. FORCE MAJEURE
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9.1 Arbitration
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If any dispute, difference of opinion or question shall arise between the
parties or any of their legal representatives concerning the construction,
meaning or effect of this Agreement, or anyting in this Agreement contained, or
the rights of the parties in this Agreement, the resolution of such dispute,
difference, or question shall be governed by the following terms and conditions:
(a) every such dispute, difference or question shall be referred to a
single arbitrator, if the parties or their legal representatives agree
on one, but if within five (5) days after a party serves notice
requiring an arbitration, the parties cannot agree on an arbitrator,
then the arbitrator shall be appointed by a Justice of the Supreme
Court of British Columbia on the application of any party to the
dispute on notice to the other(s). The arbitrator shall conduct the
arbitration under the Commercial Arbitration Act (British Columbia)
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and every award or determination shall be binding on the parties,
their heirs, legal personal representatives, successors and assigns,
and shall be a condition precedent to any action in law or in equity
relating to this Agreement other than one to compel arbitration under
this Agreement;
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(b) in any such dispute, difference or question, the arbitrator shall be
allowed unfettered and unlimited discretion to determine in every case
the solution which best balances the competing interests of the
parties to the arbitration and shall not be bound by any legal
precedent in such determination; and
(c) the arbitrator shall not be bound by the provisions of the Commercial
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Arbitration Act (British Columbia) in respect of fees. The arbitrator
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shall be entitled to award all or part of the fees against any party
in accordance with the principles which govern an award of costs
against a non-successful party in a contested matter before the
Supreme Court of British Columbia. In the absence of such an award by
the arbitrator, the arbitrator's costs shall be borne equally by the
parties without regard to their involvement in the arbitration.
9.2 Obligations Suspended
----------------------
If the parties shall fail to meet their respective obligations hereunder
within the time prescribed, and such failure shall be caused or materially
contributed to by force majeure (and for the purposes of this Agreement, force
majeure shall mean any act of God, strike, lock-out or other industrial
disturbance, sabotage, or blockades, insurrections, riots, epidemics, lightning,
earthquakes, floods, storms, fires, washouts, nuclear and radiation activity or
fallout, arrests and restraints of rules and people, civil disturbances,
explosion, breakage or accident to machinery or stoppage thereof for necessary
maintenance or repairs, inability to obtain labour, materials or equipment, any
legislative, administrative or judicial action which has been resisted in good
faith by all reasonable means, any act, omission or event whether of the kind
herein enumerated or otherwise not within the control of such party, and which
by the exercise of due diligence such party could not have prevented, but lack
of funds on the part of such party or parties shall be deemed not to be a force
majeure) such failure shall be deemed not to be a breach of the obligations of
such party but such party shall use best efforts to put itself in a position to
carry out its obligation hereunder and the time for performance of obligations
hereunder shall be extended for the length of time that the force majeure shall
have continued.
10. GENERAL PROVISIONS
-------------------
10.1 Law of British Columbia
--------------------------
This Agreement shall be governed and interpreted in accordance with the
laws of the province of British Columbia and the parties agree to submit all
disputes arising hereunder to the courts of the Province of British Columbia.
Notwithstanding the foregoing, the Company may apply to an appropriate courts in
any part of the Designated Territory or elsewhere for any injunction or other
like remedy to restrain the Licensee from committing any breach or any
anticipated breach of this Agreement and for consequential relief.
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10.2 Entire Agreement
-----------------
This Agreement constitutes the entire agreement between the parties hereto
relating to the subject matter hereof and supersedes all pior and
contemporaneous agreements, understandings, negotiations and discussions,
whether oral or written, of the parties and there are no general or specific
warranties, representations or other agreements by or among the parties in
connection with the entering into of this Agreement or the subject matter hereof
except as specifically set forth herein.
10.3 Amendments
----------
No erasure of or addition to any portion of this Agreement except filing in
of blank spaces and lines shall be binding upon the parties unless it is in
writing signed by duly authorized officers of both parties.
10.4 No Waiver
----------
No departure from or waiver of the terms of this Agreement shall be deemed
to authorize any prior or subsequent departure or waiver or require its
continuation.
10.5 Severability
------------
If any provision of this Agreement or the application of such provision
shall be held illegal or unenforceable under any laws of any jurisdiction
applicable to the Agreement the remainder of the Agreement or the application of
such provision to other persons or circumstances shall not be affected thereby.
10.6 Notice
------
Any notice required or permitted to be given under this Agreement shall be
in writing and may be given by any means reasonable calculated to reach the
other party, including, without limiting the generality of the foregoing, hand
delivery (whether by courier or otherwise), telegram, cablegram, telefax or
prepaid mail addressed to such party at its address as set forth on page one of
this Agreement. Such notice if given by hand delivery shall be deemed to be
received on the day delivered, if given by telegram, telefax, or cablegram shall
be deemed have been received on the day following dispatch thereof and notice
given as aforesaid by prepaid mail shall be deemed to have been received five
(5) days after the mailing thereof. Either party may by notice in writing given
as herein provided change its address for notice hereunder and such address as
so changed shall be deemed to be the address of such party for the purposes of
notice hereunder.
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10.7 Headings
--------
The headings in this Agreement are inserted for convenience of reference
only and are not intended to be used as an aid to the interpretation of the
provisions hereof.
10.8 No Agency
----------
The Licensee agrees that it is not and shall not represent itself to be an
agent of the Company or any Affiliate company for any purpose and shall not
incur any obligations nor make any promise or representation on behalf of the
same, and further agrees to ensure that its agents do not incur any such
obligations or make any such promises or representations.
10.9 Independent Contractors
------------------------
This Agreement does not in any way create an employer/employee relationship
between the Company or any Affiliate company and the Licensee and/or the
Licensee's employees.
10.10 Assignment
----------
The Company shall be entitled without restrictions to assign the whole or
any part of this Agreement. The Licensee may not assign the whole or any part
of this Agreement without the Company's prior written consent, except as
provided in Section 8.9.
10.11 Enurement
---------
This Agreement shall be binding upon and shall enure to the benefit of the
respective parties hereto and their successors and permitted assigns.
IN WITNESS WHEREOF the parties hereto have executed this Agreement on the day
and year first above written.
THERMO TECH BIO CONVERSION INC.
Per: /S/ Perry Smith
---------------------
Authorized Signature
PLANET EARTH RECYCLING INC.
Per: /S/ Edwin Kroeker
---------------------
Authorized Signature
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