AGREEMENT
BETWEEN: TIREX CANADA, located at 740, St-Maurice St., suite
201, Montreal (Quebec) H3C1L5, represented herein by
its President, Mr. Terence C. Byrne, who is duly
authorized for the purposes hereof
hereinafter referred to as "the Company"
AND: M.D. CONSULTANTS, located at 1547, chemin Royal,
Saint-Laurent, Ile d'Orleans (Quebec) G0A 3Z0,
represented herein by its president, Mr. Michel
DeBlois, who is duly authorized for the purposes
hereof:
hereinafter referred to as "the Consultant",
THE PARTIES AGREE:
PURPOSE
1. The purpose of this agreement is to establish the terms and conditions
of the contract between the Company and the Consultant in a spirit of
mutual cooperation and advancement.
MANDATE
2. A leading business segment for the Company involves manufacturing
molded products containing tire derived recycled rubber. The Company
wants to implement a fully commercial facility for the beginning of
August 1998. Molded adjustment rings constitute the first line of
products to be developed and marketed throughout North America.
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The Consultant's mandate includes the following:
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ACTIVITY DESCRIPTION ESTIMATED COSTS
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1 Receiving product's specs to be met, identify binders,
fillers, crumb rubber and additive suppliers, get samples
plus initial evaluation 3,260$
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2 Initial testing plus property evaluation on a small scale
with various critical variables: crumb rubber sources, mesh
size, crumb rubber-binder-additives activator ratios,
curing temperature, mixing conditions as to optimize cost
performance results plus minimize production cycles; use as
starting point all information available from competing
technologies. 9,330$
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3 Physical, chemical plus mechanical property optimization,
first on small scale basis and then on scale up (full
commercial scale) basis; comparisons with Competitor's
products; focus on product improvements over competitors'
weaker points (e.g., premature aging, inconsistent product
properties, mass balance deficiencies, long curing time,
low automation level, easy to copy recipes); 12,975$
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4 Identify available equipment (used and/or new) that could
be acquired plus installed plus tested plus optimized
within 10 weeks according to prescribed specs. 1,515$
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5 Plant plus equipment layout plus configuration (e.g.,
electrical requirements, etc.) 2,150$
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6 Full scale equipment integration plus testing plus
corrective measures where needed; 5,505$
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7 Full scale product, testing, fine tuning. 6,325$
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8 QA/QC protocol implementation plus initial staff training
plus ASTM test, coordination; 4,150$
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9 Initial commercial scale start-up operations. 2,650$
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Contingencies (10%) 4,786$
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TOTAL 52,646$
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NOTES:
o Testing facilities for small scale work will be provided by the Consultant;
o R&D activity reports will be presented by the Consultant periodically;
o Milestones meeting with Company's senior management will be scheduled
monthly.
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GENERAL FINANCIAL TERMS AND CONDITIONS
3. The Consultant's fee schedule will be as follow:
First 75 hours/month all additional hours/month
Michel Deblois: 100$/hour 85$/hour
Engineer: 65$/hour 55$hour
Technician: 45$/hour 38$/hour
The Consultant's fees will not exceed 53,000$ in total (including a 10%
contingency and excluding hotel, travel expenses and taxes). Expenses
will be billed to the Company as they are incurred.
All expenses must be pre-approved by the Company. Usual expenses shall
include material purchasing, external lab analytical expenses, living
and rental expenses, where applicable, and gas, for which the
Consultant shall be reimbursed t the rate of $0.34/km.
It is understood that the following are under the Company's
responsibility:
o Raw material purchases
o Permits, certificates
o Plant modifications (whenever needed), equipment purchase,
molds for adjustment rings, transportation, installation
PLANNING AND WORKING SCHEDULE
4. The Company will determine, in collaboration with the Consultant, the
human resources allocation required to ensure the most timely and
fruitful project management activities and overall results.
5. The Company will remain responsible for project selection and all
coordination activities with the terms of this agreement.
RESPONSABILITIES OF THE CONSULTANT
6. The Consultant undertakes to perform their duties diligently and in
accordance with industry standards; if required and only with the
Company's consent, the Consultant can use additional qualified
personnel.
RIGHT OF FIRSTREFUSAL
7. In the event where the Consultant was developing new products, a new
line of products or new technologies that present great interest and
could incur significant competitive advantages to the Company vs its
competitors, the Consultant will give (subject to certain conditions to
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be defined on a case by case approach) in writing the right of first
refusal for a period of 60 days to the Company with respect to
commercialization rights for these products and/or related technology
transfer. Monetary settlements will be dealt with on a case by case
approach.
8. In the event where the Company identified new products, new lines of
products or new technologies that present great interest and could
incur significant competitive advantages to the Company vs its
competitors, and for which product development has to be initiated up
to commercial implementation, when proven to be in the Consultant's
area of expertise, the Company will give (subject to certain conditions
to be defined on a case by case approach) the right of first refusal
for a period of 30 days to the Consultant with respect to external
resources assistance. Monetary settlements will be dealt with on a case
by case approach.
CONTRACT RESILIATION
9. The present Agreement shall terminate, without other notice, on the
occurance of any of the following situations:
o If one or both parties commit an Act of insolvency/
bankruptcy, whether voluntary or involuntary;
o Failure by the Consultant to meeting any of its
obligations under the terms of this Agreement
TAX CREDITS
10. It is understood that only the Company will be able to claim tax
credits and/or financial assistance from various public and parapublic
programs (e.g. grants, loans, etc.) for activities undertook within the
scope of this agreement.
CONFIDENTIALITY AND INTELLECTUAL PROPERTY
11. The Consultant acknowledges that it will acquire information (the
`Information') about certain matters that are confidential to the
Company, which Information is the exclusive property of the Company,
including, but not limited to, the following:
o Discoveries, inventions, research and development, formulas
and technology, improvements, written books, any item
developed in which copyright, patent or any Intellectual
Property right subsists (hereinafter the `Works');
o Trade secrets;
o Lists of present and prospective customers and buying habits;
o Purchase requirements;
o Pricing and sales policies and concepts;
o Financial information, and;
o Business plans, forecasts and market strategies.
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The Consultant acknowledges that the Information could be used to the
detriment of the Company and that its disclosure could cause
irreparable harm to the Company. Accordingly, the Consultant undertakes
to treat confidentially all Information and not to disclose it to any
third party or to use it for any purpose either for the duration of the
Agreement, except as may be necessary in the proper discharge of its
mandate, or after termination of the Agreement for any reason, except
with the written permission of the Company.
PLACE OF THE AGREEMENT
12. For the purposes hereof and of the performance of this agreement, it
shall be deemed to have been made and entered into in the City of
Montreal, in the Judicial District of Montreal, in the province of
Quebec, and it shall be subject to the laws of Quebec.
COMING INTO FORCE AND TERMS OF THE CONTRACT
13. This agreement shall come into force when it has been signed by all
parties.
14. Unless agreed by both parties and for reasons beyond the reasonable
control of either parties, all terms pertaining to this contract should
be completed by August 15, 1998.
15. If, for a serious reason beyond the reasonable control of either
parties, one party cannot comply with the terms of this agreement
momentarily, it will notify the other parties of this situation. In
turn, during that period, the other parties will not be required to
comply with the terms of the Agreement. If such a period was to be
continued to the extent that it could jeopardize the commercial
viability of projects undertook within the realm of this Agreement,
either party will have the right to terminate it.
IN WITNESS WHEREOF, THE PARTIES HAVE SIGNED THE ORIGINALS OF THIS
AGREEMENT.
THE COMPANY
by: /s/
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Date:
THE CONSULTANT
by: /s/
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Date:
