EXHIBIT 10.8
Confidential material omitted and filed separately with the
Commission and designated by *.
AGREEMENT
This Agreement ("Agreement") is entered into by and among
BOATRACS, INC., a California corporation ("Boatracs"), OCEANTRAC
SYSTEMS LIMITED, a Nova Scotia corporation ("Systems") and
OCEANTRAC INCORPORATED, a Canadian corporation ("OceanTrac") who
agree as follows:
1. Recitals.
1.1. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, a Delaware corporation
("Qualcomm") manufactures and distributes a mobile KU-Band
Satellite Mobile Communications Terminal containing a Satellite
Position Reporting System which is installed on a vehicle and
permits the vehicle to have communication access to, and report
position locating to Qualcomm's Network Management Facility (the
"Qualcomm System").
1.2. Qualcomm has authorized CANCOM/SATLINK BUSINESS
SERVICES, ("Cancom") to market, distribute and operate the
QUALCOMM SYSTEM in Canada.
1.3. Cancom has entered into an agreement with
Boatracs (the "Cancom Agreement") under the terms of which Cancom
has appointed Boatracs to act as its distributor and licensee for
the Qualcomm System for Marine Application (as defined below) in
Canada and Boatracs has modified, adapted and enhanced the
Qualcomm System for Marine Application (the "Boatracs System").
1.4. Boatracs and Systems have entered into a
Memorandum of Understanding under the terms of which OceanTrac
was formed in order that OceanTrac shall be the sole and
exclusive representative of Systems for the marketing,
distribution and sale of all products and services, including
without limitation, the sale of the Boatracs System and all
messaging related thereto in the Canadian Provinces of Ontario,
Quebec, New Brunswick, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Island, Nova Scotia,
Newfoundland and Labrador (the "Territory"), on the terms and
conditions set forth in this Agreement.
2. Organization of OceanTrac.
2.1. Boatracs and Systems have formed OceanTrac to
give effect to the Memorandum of Understanding and this
Agreement, with its principal office located at ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇ ▇▇▇ ▇▇▇.
OceanTrac's purpose shall be (a) to act as the sole and exclusive
representative of Systems for the marketing, distribution and
sale of all products and services of Systems, including without
limitation, the sale of the Boatracs System and all messaging
related thereto (which may, at OceanTrac's option, be conducted
through Systems) and (b) conduct the business of marketing,
distributing and selling the Boatracs System and any other
related business in the Territory for Marine Application and (c)
and any other business activities incidental or relating to the
foregoing. "Marine Application" shall mean the vessel and marine
industry, including without limitation, the inland and offshore
shipping, fishing, recreational boating, workboat industry,
vessels used for towing, harbor services, transportation and
supply.
2.2. The articles of incorporation (the "Articles")
and bylaws (the "Bylaws") of OceanTrac shall be in a form and
substance consistent with the provisions of this Agreement and
shall include such provisions as are necessary to give effect to
the provisions of this Agreement.
3. Capitalization. OceanTrac shall issue shares (each, "a
Share" and collectively, "Shares") in its capital stock in
accordance with the following:
3.1. All Shares of OceanTrac shall be common shares
without par value of the same class and each shareholder of
record shall be entitled at each meeting of shareholders to cast
one vote for each Share held by such shareholder.
3.2. The authorized capital of OceanTrac shall be One
Million (1,000,000)
Shares. Five thousand one hundred (5,100) Shares shall be issued
to Systems. Of the Shares issued to Systems, three thousand one
hundred (3,100) Shares shall be subject to an option to purchase
such Shares in favor of Boatracs, which may be exercised by
Boatracs by written notice to Systems specifying the number of
Shares to be purchased and tendering to a price of U.S. * per
Share against delivery of such Shares which shall occur within 14
days of receipt of such notice by Systems.
3.3. As consideration for issuance of the Shares to
Systems, Systems shall contribute the following:
(a) Appointment of OceanTrac as Systems' sole and
exclusive representative, to act as the sole and exclusive
representative of Systems for the marketing, distribution and
sale of all products and services of Systems, including without
limitation, the sale of the Boatracs System and all messaging
related thereto. OceanTrac may, in its sole and absolute
discretion, delegate to Systems certain elements of its
operations such as the messaging operations, on such terms as
OceanTrac shall determine are reasonable.
(b) Employment Agreements, in the form of attached
Exhibit A, to be executed by the Officers of
OceanTrac.
(c) An option in favor of OceanTrac granted by Systems
under the terms of which OceanTrac shall have an
option to purchase, at any time, all of the assets
of Systems other than the Shares, free and clear
of all claims and encumbrances for book value of
such assets. Such option may be exercised by
OceanTrac by written notice to Systems which may
be given at any time. OceanTrac and Boatracs
acknowledge that Systems is a party to certain
agreements that may contain restrictions upon
assignability.
(d) All necessary licensing, permits, labor, rights
and assets necessary to achieve the objectives
described in paragraph 2 above.
3.4. Boatracs shall receive a warrant evidencing
an option in favor of Boatracs to purchase up to four thousand
nine hundred (4,900) Shares at a price of U.S. * per Share. As
consideration for such warrant, Boatracs shall contribute the
following:
(a) A Distributor/Dealers Service and Sales Agreement
(the "License Agreement") with OceanTrac in the form of attached
Exhibit B. The License Agreement shall be coterminous with and
subject to the terms of the Cancom Agreement. The
Distributor/Dealer Service And Sales Agreement between Boatracs
and OceanTrac dated August 18, 1994, shall be deemed terminated
and superseded by Exhibit B;
(b) A loan to OceanTrac and Systems, jointly and
severally, in the current principal amount of $78,000, plus such
additional advances as Boatracs may elect to make, at its sole
and absolute discretion, which shall be evidenced by a promissory
note (the "Note") in the form of attached Exhibit C. The Note
shall be secured by a pledge of all of Systems Shares in
OceanTrac in the form of attached Exhibit D. OceanTrac and
Systems acknowledged that Boatracs is under no obligation to make
further advances in the Note but may do so in its sole and
absolute discretion;
(c) A loan to Systems in the sum of $20,000 (Canadian)
to be evidenced by a promissory note in the form of attached
Exhibit E and secured by a pledge of all of the shares in
Systems, in the form of attached Exhibit D;
(d) The option evidenced by the warrant may be
exercised, in whole or in part, by conversion of a portion of a
loan by Boatracs to Systems in the amount of U.S. $30,000.
3.5. The Shares shall be issued subject to the
following restrictions: (a) except as provided in this
Agreement, shareholders shall not sell, pledge or otherwise
encumber Shares without first complying with the provisions of
Paragraph 7 below; (b) all Shares shall rank equally; (c)
Boatracs shall have the option to acquire the shares of Systems
at the "Book Value" of such Shares if the employment of officers
of OceanTrac is involuntarily terminated for "good cause" or they
otherwise materially breach their obligations under their
respective Employment Agreements.
4. Election of Board of Directors and Meetings.
4.1. OceanTrac shall be managed by a Board of
Directors consisting of three (3) directors, who shall be
appointed as follows:
(a) Boatracs shall appoint two directors, one of
whom shall be a Canadian resident;
(b) Systems shall appoint one director who shall
be a Canadian resident.
4.2. Members of the Board of Directors of OceanTrac
shall be elected at the annual meeting of shareholders nominated
by the parties. Boatracs and Systems agree to vote their
respective Shares to elect their respective nominees. The term
of office of members of the Board of Directors shall be one year
and until such director's successor is elected and qualified.
Members shall be eligible to serve successive terms.
4.3. The Board of Directors shall manage the business
of OceanTrac and may exercise all powers normally exercised by a
Board of Directors, except for such powers as are required to be
exercised by shareholders, all in accordance with the Articles
and the Bylaws and applicable statutes.
4.4. (a) If a vacancy in any directorship should
occur, for whatever reason, the party who had nominated the
former director shall nominate his replacement. The parties
agree to vote their respective shares for the election of such
nominee. Vacancies shall be filled by vote of the shareholders
as provided in the Bylaws.
(b) A party to this Agreement may remove any
director nominated by such party, with our without cause, and may
replace such director with his or its nominee and other parties
shall vote their shares to effect such removal and replacement.
4.5. Two directors shall constitute a quorum for a
meeting of the Board of Directors, and all resolutions of the
Board of Directors shall be adopted by a majority of the
directors present, except as otherwise provided in this
Agreement.
4.6. Boatracs written consent shall be required for
all decisions of OceanTrac as to or affecting: (a) dissolution or
winding up of OceanTrac; (b) the sale of all or substantially all
of OceanTrac's assets; (c) any material change in the business of
OceanTrac; and (d) any increase in the compensation, benefits or
term of employment of officers of OceanTrac.
5. Meetings of Shareholders.
5.1. The quorum for any meeting of shareholders shall
be not less than two-thirds of the issued and outstanding shares
entitled to be voted at such meeting and each and every
resolution shall be adopted by a majority of the votes cast while
a quorum is present except that any resolution regarding a matter
included in paragraph 4.6 above shall only be adopted upon the
affirmative vote of not less than two-thirds (2/3) of all issued
and outstanding shares entitled to be voted at such meeting and
while a quorum is present.
5.2. Notice of meetings for shareholders, procedures
for resolutions at such meetings and any other necessary rules
with respect thereto shall be as prescribed in the Bylaws. Each
party agrees that, with respect to matters to be submitted to the
shareholders of OceanTrac by law or under the terms of the
Articles of Incorporation or Bylaws, the party wishing to submit
will not call or cause to be called a meeting of shareholders to
cause such matter to be submitted to a vote of the stockholders
at such meeting, unless at least two-thirds (2/3) of the
shareholders shall have agreed to vote their shares on such
matter in the manner described by the submitting party.
5.3. A shareholder shall be entitled to exercise its
or his right to vote by proxy at meetings of shareholders as
provided by the laws of Canada.
6. Officers, the Management Committee and Employees.
6.1. The Board of Directors of OceanTrac shall appoint
the officers ("Officers") of OceanTrac. Officers shall serve for
one year and until their successors are elected and qualified,
provided that any officer may be re-elected for successive terms.
After the term of the initial officers, officers shall be elected
at each meeting of the Board immediately following the annual
meeting of shareholders as described in the Bylaws.
6.2. Subject to the review by the Board of Directors
of the OceanTrac, a Management Committee may be constituted with
authority to decide such matters delegated to it by resolution of
the Board of Directors and the following:
(a) Compensation, including salaries, bonuses and incentive
compensation to be received by the employees of
OceanTrac (including without limitation Officers);
(b) The appointment and removal of any employee of
OceanTrac;
(c) The establishment or modification of OceanTrac's
proposed annual budget;
(d) Any recommendations to the Board of Directors with
respect to bookkeeping and accounting policies; and
(e) The selection of the bookkeeper for OceanTrac.
Regular meetings of each Management Committee may be held at such
time and place as shall from time to time be fixed by such
Management Committee and no notice thereof shall be necessary.
7. Transfer of Shares.
7.1. No party shall sell, assign, pledge or otherwise
transfer its shares of OceanTrac without the prior written
consent of the other parties, except in accordance with the
options in favor of Boatracs described in Paragraphs 3.2 and 3.4
above.
7.2. In the event a party (the "Seller") receives a
bona fide offer from a third party (the "Third Party") to
purchase all or any of its shareholding in OceanTrac (the
"Offered Shares"), and the Seller desires to sell the Offered
Shares, the Seller shall disclose details of the Offered Shares
to the other parties and shall first offer the Offered Shares for
purchase by the other parties to this Agreement at the same price
and upon the same terms and conditions offered by the Third
Party. The parties receiving the offer shall within thirty (30)
days elect by written notice to purchase the Offered Shares, at
the price and upon the terms and conditions offered, in
proportion to their respective shareholdings (exclusive of the
Seller's shareholding), provided that if one or more of the
parties declines or fails to give written notice of its election
to purchase all of its or his proportion of the Offered Shares,
the remaining parties to this Agreement shall have the right for
the next thirty (30) days to elect by written notice to purchase
pro rata (exclusive of the shareholdings of the Seller and the
party(s) declining or failing to give notice) and Offered Shares
not purchased by the other party or parties. Payment by and
transfer to parties electing to purchase Offered Shares shall be
completed no later than thirty (30) days after the giving of
notice of the election to purchase. In the event that all of the
Offered Shares are not purchased pursuant to the above
provisions, the Seller may sell such Offered Shares to the Third
Party at the same price and upon the same terms and conditions
offered by the Seller to the other parties to this Agreement,
provided that (a) the Third Party agrees in writing to be bound
by the terms and conditions of this Agreement by executing such
documents as may be required by the Board of Directors and (b)
the payment for and transfer of the Offered Shares by and to the
Third Party is effected no later than thirty (30) days after the
expiration of all periods during which the other parties to this
Agreement have the right to give notice of their election to
purchase the Offered Shares.
7.3. Certificates representing the shares of OceanTrac
shall have the following legend endorsed thereon:
"The stock represented by this Certificates is subject to
the terms of a certain Shareholders Agreement dated the
_________ day of _________________, 19__, a copy of which is
on file with the Secretary of the Company, which agreement
restricts the transfer of the shares, and copies of which
will be made available without charge.
The stock represented by this Certificate has not been
registered under any applicable securities laws, including
without limitation, the Federal Securities Act of 1933, as
amended, and any equivalent substantially similar Canadian
law, and may not be assigned, transferred or otherwise
disposed of without an opinion of counsel satisfactory to
the Company that an exemption under such Act is available
therefor or that an applicable registration statement under
such Act is effective with respect thereto. In addition,
the stock has not been registered or qualified in accordance
with the securities laws of any state and transfer may be
made only in compliance with such laws.
The Certificate of Incorporation of the Company provides for
(i) an affirmative vote of a greater than majority
proportion of votes of the directors and stockholders of the
Company and (ii) a greater proportion than majority of
directors of the Company and of shares held by stockholders
of the Company necessary to constitute a quorum, for the
transaction of certain business by such directors and
stockholders, respectively.
The Certificate of Incorporation of the Company provides
that under certain circumstances a shareholder of the
Company may request the dissolution of the Company."
8. Accounting. Commencing immediately Boatracs becomes a
shareholder of OceanTrac:
8.1. The accounting period of OceanTrac shall be the
twelve-month period commencing the 1st day of January and ending
on the 31st day of December. Complete books of account and
records shall be kept by OceanTrac according to generally
accepted accounting principles, consistently applied, employing
standards, procedures and forms conforming to established
practice in the United States and Canada. At the end of each
accounting period, such books and records shall be audited at the
expense of OceanTrac by a firm of independent certified public
accountants of good reputation, mutually acceptable to the
parties. Access to the books of account of OceanTrac shall be
made available to each of the parties at all times during normal
business hours, and each party shall have the right to have such
books of account audited by its representatives.
8.2. A balance sheet and a statement of income and
retained earnings shall be submitted by OceanTrac to each party
on an annual basis, not later than ninety (90) days after the end
of the fiscal year. Such financial statements shall be audited
at the expense of OceanTrac by a firm of independent certified
public accountants of good reputation mutually acceptable to the
parties.
8.3. Promptly after the end of each calendar month,
OceanTrac shall submit to each party (a) a report summarizing
operations for the preceding month, and (b) a financial statement
setting out income, expenses, accounts receivable and payable and
such other data as any party may reasonably request.
9. Pre-Incorporation Expenses.
9.1. All expenses incurred by the parties in
connection with the preparation of documents relating to the
formation of OceanTrac, e.g. registration fees and legal fees,
shall be borne by OceanTrac, and the parties shall cause
OceanTrac to reimburse such expenses to the parties which
incurred them. In addition, the parties agree to cause OceanTrac
to reimburse to any party all expenses incurred by such party
prior to the incorporation of OceanTrac, to the extent that the
benefit of such runs primarily to OceanTrac and not to the party
incurring such expenses.
10. Assistance to OceanTrac.
10.1. Cooperation. Each of the parties shall
cooperate fully with the other parties and OceanTrac in order to
realize the purposes of this Agreement.
10.2. Support. Without limiting the generality of
paragraph 10.1, (a) Systems and all of its shareholders shall
grant to OceanTrac an option under the terms of which OceanTrac
may purchase all of the capital shares and capital stock of
Systems for the lesser of the issuance price or book value of
such Shares, in a form reasonably acceptable to Boatracs, (b)
each of the officers of OceanTrac appointed by Systems shall
execute the Employment Agreement in the form of attached Exhibit
A, (c) Systems shall assist OceanTrac in complying with all
applicable federal, state and local regulations with respect to
performance under the Marketing Agreement and this Agreement and
it shall provide OceanTrac with technical support and assistance
necessary to achieve its objectives.
11. Warranties and Representations of Systems. Systems
represents and warrants to Boatracs as follows:
11.1. Organization and Authority.
Systems is a corporation duly organized, validly
existing and in good standing under the laws of Nova Scotia and
has all requisite power and authority to own, operate and lease
its properties and to carry on its business as now being
conducted. Systems is duly licensed or qualified to do business
and is in good standing in each jurisdiction where the failure to
be so qualified or licensed would have a material adverse effect
on the business or financial condition of Systems. Systems has
no subsidiaries and no direct or indirect interest or interests
by stock ownership or otherwise in any firm, association,
corporation or business enterprise.
11.2. Authorization of Agreement.
Systems has the power and authority to execute and
delivery this Agreement and to perform its obligations hereunder.
The execution, delivery and performance of this Agreement by
Systems has been duly authorized by all necessary corporate
action on the part of Systems and its shareholders. This
Agreement and all agreements referenced to in this Agreement,
will be duly executed and delivered by Systems and constitutes or
will, when executed and delivered, constitute the legal, valid
and binding obligation of Systems enforceable against Systems in
accordance with their respective terms, except as the same may be
limited by bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally now or
hereafter in effect and subject to the application of equitable
principles and the availability of equitable remedies.
11.3. Capital Stock.
The authorized capital stock of Systems consists of
40,000 shares of common stock, $1.00 (Canadian) par value, of
which 100 shares are presently issued and outstanding. All of
the outstanding capital stock of Systems has been duly authorized
and is validly issued, fully paid and non-assessable. Systems
has not entered into any contract or agreement or made any
commitment to sell or otherwise transfer or issue any shares of
its capital stock and there are no outstanding options, rights,
subscriptions, warrants, conversion rights, agreements or
commitments of any kind to purchase or otherwise acquire from
Systems or its shareholders any shares of capital stock of
Systems.
11.4. No Conflicts.
The execution, delivery and performance of this
Agreement and the consummation of all of the transactions
contemplated hereby: (i) do not and will not require the consent,
waiver, approval, license, designation or authorization of, or
declaration with, any person or public authority; (ii) do not and
will not with or without the giving of notice or the passage of
time or both, violate or conflict with or result in a breach or
termination of any provision of, or constitute a default under,
or accelerate or permit the acceleration of the performance
required by the terms of, or result in the creation of any
mortgage, security interest, claim, lien, charge or other
encumbrance upon any of its assets pursuant to, or otherwise give
rise to any liability or obligation under, any agreement,
mortgage, deed of trust, indenture, license, permit or any other
agreement or instrument or any order, judgment, decree, statute,
regulation or any other restriction of any kind or description to
which Systems or either Stockholder is a party or by which
Systems or any of its assets may be bound; and (iii) will not
terminate or result in the termination of any such agreement or
instrument, or in any way affect or violate the terms and
conditions of, or result in the cancellation, modification,
revocation or suspension of, any rights included in its assets.
11.5. Financial Statements.
11.5.1. For all relevant periods, Systems'
Financial Statements: (1) are complete and correct in all
material respects; (2) present fairly the financial position of
the Company at such dates and the results of operations for the
respective periods ended on such dates; (3) were prepared in
accordance with generally accepted accounting principles
applicable in Canada, consistently applied during the periods,
except as indicated in the report or notes thereto (and, in the
case of the Interim Financial Statements, subject to ordinary and
recurring year-end adjustments), and are in accordance with the
books and records maintained by Systems, with no differences
between such Systems' Financial Statements and the financial
records maintained and accounting methods applied by Systems for
tax purposes, except as disclosed in the notes to the Financial
Statements.
11.5.2. The value at which any or all of its
assets are carried on the 1994 Financial Statements is not
overstated and does not exceed each asset's or group of assets'
replacement cost and does not exceed each asset's or group of
assets' fair market value.
11.5.3. Schedule 11.5.3 is a true, correct and
complete list of all of Systems' accounts receivable (aged) as of
December 31, 1995. All such accounts receivable of Systems shown
on and all accounts receivable existing on the Closing Date are
fully collectible in the aggregate recorded amounts thereof.
11.5.4. Except as disclosed in the Schedules
hereto (if any), as at December 31, 1995 Systems had no
liabilities, commitments or obligations of any nature, whether
absolute, accrued, contingent or otherwise not shown and
adequately provided for in the 1995 Financial Statements.
11.5.5. Systems' earnings from operations shall
not reflect any material adverse change from the level of
earnings from operations as at December 31, 1995.
11.6. Taxes.
(a) To the knowledge of Systems, all tax returns
(including information returns) required by any jurisdiction with
respect to Systems have been filed, except for returns with
respect to which extensions have been granted, and each such
return is true and correct. There are no pending or threatened
tax examinations, claims (whether for taxes, interest or
penalties), liens, assessments, deficiencies or liabilities to
which Systems or its assets may be subject; the tax returns for
Systems for the years ended December 31, 1992, 1993 and 1994 have
not been audited by any governmental body; and no waiver of the
statute of limitations or extension of time for assessment of
deficiencies has been granted by Systems.
(b) All liabilities of Systems to any
jurisdiction for taxes (including, without limitation, all
payroll withholding taxes and all other employment related taxes)
of Systems, including interest thereon and penalties with respect
thereto, relating to any period prior to the Closing Date have
been paid by Systems or will be paid by Systems when due.
11.7. No Adverse Changes.
Since December 31, 1995 (i) the business of Systems has
been conducted only in the ordinary course; (ii) there has been
no change in the condition (financial or otherwise), assets,
liabilities, business, operations, prospects, or affairs of
Systems, other than changes in the ordinary course of business,
none of which singly and no combination of which in the aggregate
has been materially adverse; and (iii) there has been no damage,
destruction or loss or other occurrence or development, whether
or not insured against, which either singly or in the aggregate
materially adversely affects, and Systems and Systems and its
shareholders have no knowledge of any threatened occurrence or
development which would materially adversely affect, the
condition (financial or otherwise), assets, liabilities,
business, operations, prospects or affairs of Systems.
11.8. Litigation, Compliance.
(a) There are no actions, suits, proceedings or
arbitrations or governmental investigations pending or, to
Systems' knowledge, threatened against, by or affecting Systems
(or, to the best of Systems' knowledge, any basis therefor) in
which, individually or in the aggregate, an unfavorable
determination could materially affect the company's business or
Systems' earnings or condition (financial or otherwise) or any of
its assets or any of System's assets or result in any material
liability on the part of Systems or impede the execution and
performance of this Agreement or any of the transactions or
events contemplated hereby or could declare this Agreement
unlawful or cause the rescission of any of the transactions
hereunder or require Systems to divest itself of its assets or
any of System's assets to be acquired pursuant hereto, nor has
any such suit been pending within the three (3) years prior to
the Closing Date. Systems has received no notice that it has
been charged with or received notice of any violation of any
applicable federal, provincial, local or foreign law, rule,
regulation, ordinance, order or decree relating to its assets or
any of System's assets, or the operation of Systems' business,
and Systems are not aware of any threatened claim of such
violation (including any investigation or informal inquiry).
Systems and the Stockholders are not aware of any basis for any
claim or charge of such violation.
(b) Systems has complied and is in compliance with,
all material respects, all laws, rules, regulations, ordinances,
orders, decrees, writs, injunctions, building codes, safety, fire
and health approvals, certificates of occupancy or other
governmental restrictions applicable to Systems and its assets.
(c) Systems has all governmental licenses, permits,
approvals or other authorizations required for the conduct of the
business as presently conducted. All of such licenses, permits
or approvals are in full force and effect; there is no action
pending or to the knowledge of Systems and its shareholders,
threatened to terminate rights under any such governmental
licenses, permits or authorizations.
11.9. Environmental Compliance.
No toxic waste or by-product has been or is being
discharged on, or stored, processed, or treated at, any real
property or other facilities now or previously used by Systems by
either Systems, or to its knowledge, by any other person. No
substance defined as hazardous or toxic by any applicable
federal, state, provincial, or local laws, rules or regulations
has been or is being used by, or has been or is being discharged
on, or stored, processed, or treated at, any real property or
other facilities now or previously owned, leased or used by
Systems by either Systems or, to its knowledge by any other
person. No employee or other person has ever made a claim or
demand against Systems based on alleged damage to health caused
by any such hazardous or toxic materials or by any waste or by-
product. Systems has never been charged with improperly using,
handling, storing, discharging, or disposing of any such
hazardous or toxic substance, or with causing or permitting any
pollution of any ground water aquifer, surface waters, or other
lakes, streams, rivers, or bodies of water. Systems has not
caused or suffered to occur any discharge, spillage, uncontrolled
loss, seepage, or filtration of oil or petroleum or chemical
liquids or solids, liquid or gaseous products, or hazardous
waste, or hazardous substance at, under, or within any real
property now or previously owned or leased by Systems. There is
no asbestos or PCB's on the real property.
11.10. Corporate Records.
The copy of the certificate of incorporation of
Systems, and all amendments thereof to date, and a long form
certificate as to the good standing of Systems in Nova Scotia
each certified by the registrar of Joint Stock Corporations of
Nova Scotia, and of the by-laws of Systems, as amended to date,
certified by the Secretary or an Assistant Secretary of Systems,
are complete and correct, and the minute books of Systems
correctly reflect all material corporate actions taken at all
meetings of directors (including committees thereof) and
stockholders, and correctly record all resolutions, correct and
complete. The stock transfer books (with all canceled and unused
stock certificates attached) and stock ledgers are complete and
correct and correctly reflect all transfers of the capital stock
of Systems, correct and complete.
11.11. Disclosure.
No representation or warranty by Systems or its agents
and no statement or certificate furnished or to be furnished by
or on behalf of Systems or its shareholders to Boatracs or its
agents pursuant to this Agreement or in connection with the
transactions contemplated hereby contains any untrue statement of
a material fact or omits to state a material fact necessary in
order to make the statements contained herein or therein not
misleading or necessary to provide a prospective purchaser of its
assets with proper information as to Systems and its affairs.
12. Indemnification by Systems. Systems hereby indemnifies
Boatracs against all Claims (as defined below) and all costs,
expenses and attorney's fees incurred in the defense of any of
such Claims or any action or proceeding brought on any of such
Claims. For purposes of this Paragraph, "Claims" shall mean all
liabilities, damages, losses, costs, expenses, attorney's fees
and claims (except to the extent caused by Boatracs' negligent
act, wilful misconduct or breach under this Agreement) arising
from (a) any material breach or default in the performance of any
obligation to be performed by Systems under this Agreement or any
breach of any warranty and representation by Systems, (b) any
negligence of Systems or any agent, employee, contractor,
representative, guest or invitee, of or retained by Systems. If
any action or proceeding is brought against Boatracs by reason of
any such Claims, Systems upon notice from Boatracs shall defend
such action or proceeding at Systems's sole cost by legal
counsel satisfactory to Boatracs. Nothing in this Paragraph
creates any rights to which any insurance company may be
subrogated and no person who is not a party to this Agreement may
enforce, directly or indirectly, this Paragraph.
13. Public Liability and Property Damage Insurance.
OceanTrac at its sole cost shall maintain public liability,
property damage and products liability insurance, with a single
combined liability limit of not less than U.S. $1,000,000.00 and
property damage limits of not less than U.S. $1,000,000.00,
insuring against all liability of Boatracs and Boatracs' agents,
employees and/or representatives arising out of or in connection
with use of the Boatracs System. All public liability, property
damage and products liability insurance, shall be "occurrence
based" and not "claims made" coverage and shall name Boatracs as
an additional named insured. Insurance required to be maintained
by OceanTrac under this Agreement shall be issued as a primary
policy by insurance companies authorized to do business in the
state where Boatracs' principal office is located, with a Best's
Rating of at least "A+" and a Best's Financial Size Category
rating of at least "XV", as set forth in the most current edition
of "Best's Insurance Reports". No such policy or policies shall
be cancelable or subject to reduction of coverage or other
modification except after 30-days' prior written notice to
Boatracs. OceanTrac shall, at least 30 days prior to the
expiration of each such policy, furnish Boatracs with a renewal
or "binder" of such policy or else Boatracs may order such
renewal or "binder" and charge its cost to OceanTrac, which
amount shall be payable to Boatracs by OceanTrac upon demand.
OceanTrac shall promptly deliver to Boatracs copies of such
policy or policies or certificates evidencing the existence and
amounts of such insurance together with evidence of payment of
premiums.
14. Arbitration. Any dispute, controversy or claim arising
out of or related to this Agreement shall be finally settled by
arbitration in accordance with the Rules of Conciliation and
Arbitration of the International Chamber of Commerce.
14.1. In the event of any conflict between these Rules
and this paragraph, the provisions of this paragraph shall
govern. The arbitration shall take place in San Diego,
California. Each of the parties shall appoint one arbitrator and
the two so nominated shall in turn choose a third arbitrator. If
the arbitrators chosen by the parties cannot agree on the choice
of the third arbitrator within a period of thirty (30) days after
their nomination, then the third arbitrator shall be appointed by
the Court of Arbitration of the International Chamber of
Commerce.
14.2. The arbitration shall be conducted in the
English language. Relevant documents in other languages shall be
translated into English if the arbitrators so direct. In
arriving at their award, the arbitrators shall make every effort
to find a solution to the dispute in the provisions of the
Agreement and shall give full effect to all parts thereof.
However, if a solution cannot be found in the provisions of the
Agreement, the arbitrators shall apply the local, domestic law of
the State of California, U.S.A., including its provision of the
Uniform Commercial Code.
14.3. The parties agree that after either has filed a
Notice of Demand for arbitration of any dispute subject to
arbitration under this Agreement, they shall, upon request, make
discovery and disclosure of all materials relevant to the subject
of the dispute. The arbitrators shall make the final
determination as to any discovery disputes between the parties.
Examination of witnesses by the parties and by the arbitrators
shall be permitted. A written transcript of the hearing shall be
made and furnished to the parties. The cost of this transcript
shall be borne equally by the parties.
14.4. The arbitrators shall state the reasons upon
which the award is based. The award of the arbitrators shall be
final and binding upon the parties. Judgment upon the award may
be entered in any court having jurisdiction. An application may
be made to any such court for a judicial acceptance of the award
and an order for enforcement.
15. Further Assurances. Each party to this Agreement shall
execute and deliver all instruments and documents and take all
actions as may be reasonably required or appropriate to carry out
the purposes of this Agreement.
16. Counterparts and Exhibits. This Agreement may be
executed in counterparts, each of which is deemed an original and
all of which together constitute one document. All exhibits
attached to and referenced in this Agreement are incorporated
into this Agreement.
17. Time of Essence. Time and strict and punctual
performance are of the essence with respect to each provision of
this Agreement.
18. Attorney's Fees. The prevailing party(ies) in any
litigation, arbitration, mediation, bankruptcy, insolvency or
other proceeding ("Proceeding") relating to the enforcement or
interpretation of this Agreement may recover from the
unsuccessful party(ies) all costs, expenses, and actual
attorney's fees (including expert witness and other consultants'
fees and costs) relating to or arising out of (a) the Proceeding
(whether or not the Proceeding proceeds to judgment), and (b) any
post-judgment or post-award proceeding including, without
limitation, one to enforce or collect any judgment or award
resulting from the Proceeding. All such judgments and awards
shall contain a specific provision for the recovery of all such
subsequently incurred costs, expenses, and actual attorney's
fees.
19. Modification. This Agreement may be modified only by a
contract in writing executed by the party to this Agreement
against whom enforcement of the modification is sought.
20. Headings. The paragraph headings in this Agreement:
(a) are included only for convenience, (b) do not in any manner
modify or limit any of the provisions of this Agreement, and (c)
may not be used in the interpretation of this Agreement.
21. Prior Understandings. This Agreement and all documents
specifically referred to and executed in connection with this
Agreement: (a) contain the entire and final agreement of the
parties to this Agreement with respect to the subject matter of
this Agreement, and (b) supersede all negotiations, stipulations,
understandings, agreements, representations and warranties, if
any, with respect to such subject matter, which precede or
accompany the execution of this Agreement.
22. Interpretation. Whenever the context so requires in
this Agreement, all words used in the singular may include the
plural (and vice versa) and the word "person" includes a natural
person, a corporation, a firm, a partnership, a joint venture, a
trust, an estate or any other entity. The terms "includes" and
"including" do not imply any limitation. For purposes of this
Agreement, the term "day" means any calendar day and the term
"business day" means any calendar day other than a Saturday,
Sunday or any other day designated as a holiday under California
Government Code Sections 6700-6701. Any act permitted or
required to be performed under this Agreement upon a particular
day which is not a business day may be performed on the next
business day with the same effect as if it had been performed
upon the day appointed. No remedy or election under this
Agreement is exclusive, but rather, to the extent permitted by
applicable law, each such remedy and election is cumulative with
all other remedies at law or in equity.
23. Partial Invalidity. Each provision of this Agreement
is valid and enforceable to the fullest extent permitted by law.
If any provision of this Agreement (or the application of such
provision to any person or circumstance) is or becomes invalid or
unenforceable, the remainder of this Agreement, and the
application of such provision to persons or circumstances other
than those as to which it is held invalid or unenforceable, are
not affected by such invalidity or unenforceability [unless such
provision or the application of such provision is essential to
this Agreement].
24. Successors-in-Interest and Assigns. Neither party may
voluntarily or by operation of law assign, hypothecate, delegate
or otherwise transfer or encumber all or any part of its rights,
duties or other interests in this Agreement without the prior
written consent of the other party, which consent may be withheld
in such parties' sole and absolute discretion. Any such transfer
in violation of this paragraph is void. Subject to the foregoing
and any other restrictions on transferability contained in this
Agreement, this Agreement is binding upon and inures to the
benefit of the successors-in-interest and assigns of each party
to this Agreement.
25. Notices. Each notice and other communication required
or permitted to be given under this Agreement ("Notice") must be
in writing. Notice is duly given to another party upon: (a)
hand delivery to the other party, (b) receipt by the other party
when sent by facsimile to the address and number for such party
set forth below (provided, however, that the Notice is not
effective unless a duplicate copy of the facsimile Notice is
promptly given by one of the other methods permitted under this
paragraph), (c) three business days after the Notice has been
deposited with the United States postal service as first class
certified mail, return receipt requested, postage prepaid, and
addressed to the party as set forth below, or (d) the next
business day after the Notice has been deposited with a reputable
overnight delivery service, postage prepaid, addressed to the
party as set forth below with next-business-day delivery
guaranteed, provided that the sending party receives a
confirmation of delivery from the delivery-service-provider.
Boatracs: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
with a copy to: ▇▇▇▇▇▇▇ ▇▇▇▇ Seidenwurm & ▇▇▇▇▇
▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
To: OceanTrac Systems Limited
▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
To: OceanTrac Incorporated
▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Each party shall make a reasonable, good faith effort to ensure
that it will accept or receive Notices to it that are given in
accordance with this paragraph. A party may change its address
for purposes of this paragraph by giving the other party(ies)
written notice of a new address in the manner set forth above.
26. Waiver. Any waiver of a default or provision under
this Agreement must be in writing. No such waiver constitutes a
waiver of any other default or provision concerning the same or
any other provision of this Agreement. No delay or omission by a
party in the exercise of any of its rights or remedies
constitutes a waiver of (or otherwise impairs) such right or
remedy. A consent to or approval of an act does not waive or
render unnecessary the consent to or approval of any other or
subsequent act.
27. Drafting Ambiguities. Each party to this Agreement
has reviewed and revised this Agreement and has had the
opportunity to have such party's legal counsel review and revise
this Agreement. The rule of construction that ambiguities are to
be resolved against the drafting party or in favor of the party
receiving a particular benefit under an agreement may not be
employed in the interpretation of this Agreement or any amendment
to this Agreement.
BOATRACS, INC
A California Corporation
By: /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Its: C.E.O.
OCEANTRAC SYSTEMS LIMITED,
A Canadian Corporation
By: /s/▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Its: PRESIDENT
OCEANTRAC INCORPORATED,
A Canadian Corporation
By: /s/▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Its: PRESIDENT
EXHIBIT A
EMPLOYMENT AGREEMENT
This Agreement is executed effective ____________, 199_,
between OCEANTRAC, INCORPORATED, a Canadian corporation,
("OceanTrac") and ____________________, an individual, having an
address at _________________________________ ("Officer"), who
agree as follows:
1. Hiring. OceanTrac hereby hires Officer as
________________________________
________________________________________________.
2. Duties. Officer shall faithfully and diligently perform
the following duties on a full-time basis: (a) Devoting
Officer's entire productive time, ability and attention to the
business of OceanTrac; and (b) Performing such other duties as
OceanTrac shall from time to time specify that are consistent
with the duties normally performed by an employee like Officer.
3. Termination. At any time that Good Cause (as defined
below) exists or has arisen, upon 30 days written notice ("Good
Cause Notice") either Officer or OceanTrac may, at his or its
election, terminate this Agreement by so notifying the other.
Upon 30 days written notice, whether or not Good Cause exists or
has arisen, either OceanTrac or Officer may, at either party's
election, terminate this Agreement by so notifying the other in
writing (the "Termination Notice"), for any reason whatsoever or
for no reason. Upon the earlier of the Termination Date, 30 days
after giving of the Good Cause Notice, or 60 days after the
giving of the Termination Notice, (a) this Agreement shall be
deemed terminated, (b) Neither Officer nor OceanTrac shall have
any further rights or obligations under this Agreement, (c)
Officer shall return to OceanTrac all property belonging to
OceanTrac, including without limitation all Confidential Material
(as defined below), promotional material, advertising
information, samples, price lists and similar items, and (d)
OceanTrac shall have no obligation to make any further payments
to Officer, except for amounts earned pursuant to this Agreement
by Officer prior to such termination, which amounts OceanTrac
shall pay to Officer upon Officer's returning to OceanTrac all
such property without abatement or deduction, other than
customary and lawful deductions. For purposes of this Agreement,
"Good Cause" shall mean the existence or occurrence of any of the
following:
3.1. Any wilful breach of duty by Officer, or any
failure by Officer to perform, to the reasonable satisfaction of
the board of directors of OceanTrac, such duties as may be
delegated to Officer by OceanTrac from time to time.
3.2. If Officer is convicted of a felony.
3.3. If Officer commits theft, larceny, embezzlement,
fraud, any acts of dishonesty, illegality, or gross
mismanagement, as determined in good faith by the board of
directors of OceanTrac.
3.4. If Officer otherwise materially breaches any
provision of this Agreement.
3.5. The death of Officer.
3.6. If Officer becomes materially disabled to such an
extent that Officer is precluded from performing the duties set
forth in this Agreement for a period of 90 consecutive days, or
120 days in the aggregate during any one-year period.
3.7. The occurrence of existence of any facts that
constitute grounds for termination pursuant to California Labor
Code Section 2924.
4. No Employment Term/At-Will Employment. Nothing in this
Agreement shall be construed to create any agreement for any
indefinite or specific term of employment between OceanTrac and
Officer. This Agreement may be terminated by either OceanTrac or
Officer at-will for any reason whatsoever or for no reason at all
by giving the Termination Notice (as defined in Paragraph 3
above).
5. Compensation. Officer's total compensation under this
Agreement shall be $_________ per annum, payable at the rate of
$________ for each two week period, which payments shall be made
in accordance with and at the same times as OceanTrac's ordinary
payroll procedures. OceanTrac shall give Officer performance and
compensation reviews no less than every year.
6. Benefits. Officer shall be entitled to the following
benefits during the term of this Agreement:
6.1. OceanTrac shall pay Officer an allowance for
medical, disability, workmen's compensation, and dental insurance
in accordance with OceanTrac's prevailing policy, which OceanTrac
may amend from time to time.
6.2. Two weeks paid vacation for each one-year period
during the term of this Agreement (prorated for any partial
year), to be taken at such times that are consistent with
Officer's performance of Officer's duties under this Agreement
and that are approved by OceanTrac, whose approval shall not be
unreasonably withheld, but shall not be taken during the
occurrence of any trade show that OceanTrac is participating in.
Officer shall forfeit any vacation time not taken during the
applicable calendar year unless OceanTrac agrees in writing that
Officer may accrue such vacation time.
6.3. Reimbursement for reasonable out-of-town travel
expenses and local expenses incurred in the proper performance of
Officer's duties under this Agreement and authorized by OceanTrac
in writing. Reimbursement shall be made at the end of the pay
period following the pay period during which Officer submits a
detailed accounting of such expenses, in a form satisfactory to
OceanTrac.
6.4. Reimbursement for reasonable expenses incurred in
the proper performance of Officer's duties under this Agreement
and authorized by OceanTrac in writing. Reimbursement shall be
made at the end of the pay period following the pay period during
which Officer submits a detailed accounting of such expenses, in
a form satisfactory to OceanTrac.
6.5. In the event of an illness or personal or family
emergency, Officer shall dutifully notify OceanTrac of such event
and OceanTrac shall not reasonably withhold permission for a paid
absence. If absences are excessive, OceanTrac and Officer can
redefine status of leave due as accrued or unaccrued as
necessary.
Officer shall not be entitled to any other compensation or
benefits.
7. Confidentiality. Officer hereby acknowledges that
OceanTrac has made available to Officer certain customer lists,
product design information, performance standards and other
confidential and/or Proprietary Information (as defined in
Paragraph 11 below) of OceanTrac or licensed to OceanTrac,
including without limitation trade secrets and copyrighted
materials (collectively, the "Confidential Material"). Except as
essential to Officer's obligations under this Agreement, or as
required by law, neither Officer nor any agent, employee, office,
or independent contractor of or retained by Officer shall make
any disclosure of this Agreement, the terms of this Agreement, or
any of the Confidential Material. Officer shall notify each such
person to whom such disclosure is made that such disclosure is
made in confidence and shall be kept in confidence by such
person. Except as essential to OceanTrac's obligations under
this Agreement, or as required by law, or as requested in writing
by Officer, neither OceanTrac nor any agent, employee, officer or
independent contractor of or retained by OceanTrac shall make any
disclosure of this Agreement or the terms of this Agreement.
8. Representations and Warranties. Officer hereby
represents and warrants that (a) this Agreement will not cause or
require Officer to breach any obligation to, or agreement or
confidence with, any other person, (b) as of the date of this
Agreement (except as disclosed in writing by Officer to OceanTrac
prior to the execution of this Agreement), Officer is not
representing, or otherwise affiliated in any capacity with, any
other lines of products, manufacturers or vendors, and (c) during
the term of this Agreement, Officer shall not represent, or
otherwise become affiliated in any capacity with, any lines of
products, manufacturers or vendors, which, in the reasonable and
good faith opinion of OceanTrac, may be competitive with any
products of OceanTrac, whether or not Products.
9. Proprietary Information. For purposes of this
Agreement, "Proprietary Information" shall mean any information,
observation, data, written material, record, document, computer
program, software, firmware, invention, discovery, improvement,
development, tool, machine, apparatus, appliance, design,
promotional idea, customer list, practice, process, formula,
method, technique, trade secret, product and/or research related
to the actual or anticipated research, development, products,
organization, business or finances of OceanTrac (or any of its
affiliates). All right, title and interest of every kind and
nature whatsoever in and to the Proprietary Information made,
discussed, developed, secured, obtained or learned by Officer
during the term of this Agreement, or the 60-day period
immediately following the termination of this Agreement, shall be
the sole and exclusive property of OceanTrac for any purposes or
uses whatsoever, and shall be disclosed promptly by Officer to
OceanTrac. The covenants set forth in the preceding sentence
shall apply regardless of whether any Proprietary Information is
made, discovered, developed, secured, obtained or learned (a)
solely or jointly with others, (b) during the usual hours of work
or otherwise, (c) at the request and upon the suggestion of
OceanTrac or otherwise, or (d) with OceanTrac's materials, tools,
instruments or on OceanTrac's premises or otherwise. All
Proprietary Information developed, created, invented, devised,
conceived or discovered by the Officer that are subject to
copyright protection are explicitly considered by Officer and
OceanTrac to be works made for hire to the extent permitted by
law. Officer hereby assigns to OceanTrac all of Officer's right,
title and interest in and to the Proprietary Information.
Officer hereby forever fully releases and discharges OceanTrac,
any affiliates of OceanTrac and their respective officers,
directors and employees, from and against any and all claims,
demands, damages, liabilities, costs and expenses of Officer
arising out of, or relating to, any Proprietary Information.
Officer shall execute any documents and take any action OceanTrac
may deem necessary or appropriate to effectuate the provisions of
this Agreement, including without limitation assisting OceanTrac
in obtaining and/or maintaining patents, copyrights or similar
rights to any Proprietary Information assigned to OceanTrac, if
OceanTrac, in its sole discretion, requests such assistance.
Officer shall comply with any reasonable rules established from
time to time by OceanTrac for the protection of the
confidentiality of any Proprietary Information. Officer
irrevocably appoints the President of OceanTrac to act as
Officer's agent and attorney-in-fact to perform all acts
necessary to obtain and/or maintain patents, copyrights and
similar rights to any Proprietary Information assigned by Officer
to OceanTrac under this Agreement if (i) Officer refuses to
perform those acts, or (ii) is unavailable, within the meaning of
any applicable laws. Officer acknowledges that the grant of the
foregoing power of attorney is coupled with an interest and shall
survive the death or disability of the Officer. Officer shall
promptly disclose to OceanTrac, in confidence (A) all Proprietary
Information that Officer creates during the term of this
Agreement, and (B) all patent applications that relate to or
arise out of Proprietary Information filed by Officer within one
year after termination of this Agreement. Any application for a
patent, copyright registration or similar right filed by Officer
within one year after termination of this Agreement shall be
reasonably and in good faith presumed to relate to Proprietary
Information created by Officer during the term of this Agreement,
unless Officer can prove otherwise. Nothing contained in this
Agreement shall be construed to preclude OceanTrac from
exercising all of its rights and privileges as sole and exclusive
owner of all of the Proprietary Information owned by or assigned
to OceanTrac under this Agreement. OceanTrac, in exercising such
rights and privileges with respect to any particular item of
Proprietary Information, may decide not to file any patent
application or any copyright registration on such Proprietary
Information, may decide to maintain such Proprietary Information
as secret and confidential, or may decide to abandon such
Proprietary Information or dedicate it to the public. Officer
shall have no authority to exercise any rights or privileges with
respect to the Proprietary Information owned by or assigned to
OceanTrac under this Agreement. This Agreement does not apply to
any Proprietary Information that qualifies fully under the
provisions of California Labor Code Section 2870 or any similar
or successor statute.
10. Competition. During the term of this Agreement,
Officer shall not own an interest in, operate or participate in,
or be connected as an officer, director, employee, agent,
independent contractor, partner, shareholder or principal of any
business entity or person producing, designing, providing,
soliciting orders for, selling, distributing, or marketing
products, goods, equipment and/or services which compete with
OceanTrac's products, goods, equipment and/or services. To the
extent permitted by applicable law, for two years following
termination of this Agreement, Officer shall not undertake any
employment or activity competitive with OceanTrac's business,
including without limitation the inducement or solicitation of
OceanTrac's customers, if the duties or work of, in connection
with or related to such competitive employment or activity would
or might cause Officer to reveal or use any Proprietary
Information. During the term of this Agreement, Officer shall
not employ or attempt to employ (whether as an employee,
consultant or otherwise) any of OceanTrac's employees who work in
any area in which Officer has been significantly engaged on
behalf of OceanTrac.
11. Business Opportunities. During the terms of this
Agreement, if Officer (or any agent, employee, officer or
independent contractor of or retained by Officer) becomes aware
of any project, investment, venture, business or other
opportunity (any of the preceding, an "Opportunity") that is
similar to, competitive with, related to or in the same field as
OceanTrac, or any project, investment, venture, or business of
OceanTrac, then Officer shall so notify OceanTrac immediately in
writing of such Opportunity and shall use Officer's good faith
efforts to cause OceanTrac to have the opportunity to invest in,
participate in or otherwise become affiliated with such
Opportunity.
12. Indemnification by Officer. Officer hereby indemnifies
OceanTrac against all Claims (as defined below) and all costs,
expenses and attorneys' fees incurred in the defense of any such
Claims or any action or proceeding brought on any such Claims.
For purposes of this Paragraph, "Claims" shall mean all
liabilities, damages, costs, expenses, attorneys' fees and
claims, except to the extent caused by OceanTrac's negligent act,
wilful misconduct or breach under this Agreement, arising from
(a) any breach or default in the performance of any obligation to
be performed by Officer under this Agreement, or (b) any gross
negligence or wilful misconduct of Officer or any of Officer's
agents, employees, officers, or independent contractors. If any
action or proceeding is brought against OceanTrac by reason of
any such Claims, Officer upon notice from OceanTrac shall defend
such action or proceeding at Officer's sole cost by counsel
satisfactory to OceanTrac which approval shall not be
unreasonably withheld.
13. Indemnification by OceanTrac. OceanTrac hereby
indemnifies Officer against all Claims (as defined below) and all
costs, expenses and attorneys' fees incurred in the defense of
any such Claims or any action or proceeding brought on any such
Claims. For purposes of this Paragraph, "Claims" shall mean all
liabilities, damages, costs, expenses, attorneys' fees and
claims, except to the extent caused by OceanTrac's negligent act,
wilful misconduct or breach under this Agreement, arising from
(a) any breach or default in the performance of any obligation to
be performed by OceanTrac under this Agreement, or (b) any gross
negligence or wilful misconduct of OceanTrac or any of
OceanTrac's agents, employees, officers, or independent
contractors. If any action or proceeding is brought against
Officer by reason of any such Claims, OceanTrac upon notice from
Officer shall defend such action or proceeding at OceanTrac's
sole cost by counsel satisfactory to Officer which approval shall
not be unreasonably withheld.
14. Survival. The representations, warranties and
covenants of the parties to this Agreement shall survive any
termination of this Agreement.
15. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California.
16. Further Assurances. Each party to this Agreement shall
execute all instruments and documents and take all actions as may
be reasonably required to effectuate this Agreement.
17. Venue and Jurisdiction. For purposes of venue and
jurisdiction, this Agreement shall be deemed made and to be
performed in the City of San Diego, California.
18. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original and all
of which together shall constitute one document.
19. Modification. This Agreement may be modified only by a
contract in writing executed by the party(ies) to this Agreement
against whom enforcement of such modification is sought.
20. Headings. The headings of the Paragraphs of this
Agreement have been included only for convenience, and shall not
be deemed in any manner to modify or limit any of the provisions
of this Agreement, or be used in any manner in the interpretation
of this Agreement.
21. Prior Understandings. Upon execution of this
Agreement, such interim Employment Agreement shall lapse and be
of no further force or effect. This agreement contains the
entire agreement between the parties of this Agreement with
respect to the subject matter of this Agreement, is intended as a
final expression of such parties' agreement with respect to such
terms as are included in this Agreement, is intended as a
complete and exclusive statement of the terms of such agreement,
and supersedes all negotiations, stipulations, understandings,
agreements, representations and warranties, if any, with respect
to such subject matter, which precede or accompany the execution
of this Agreement.
22. Interpretation. Whenever the context so requires in
this Agreement, all words used in the singular shall be construed
to have been used in the plural (and vice versa), each gender
shall be construed to include any other genders, and the word
"person" shall be construed to include a natural person, a
corporation, a firm, a partnership, a joint venture, a trust, an
estate or any other entity.
23. Partial Invalidity. Each provision of this Agreement
shall be valid and enforceable to the fullest extent permitted by
law. If any provision of this Agreement or the application of
such provision to any person or circumstance shall, to any
extent, be invalid or unenforceable, the remainder of this
Agreement, or the application of such provision to persons or
circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected by such invalidity or
unenforceability, unless such provision or such application of
such provision is essential to this Agreement.
24. Notices. All notices or other communications required
or permitted to be given to a party to this Agreement shall be in
writing and shall be personally delivered, sent by registered or
certified mail, postage prepaid, return receipt requested, or
sent by an overnight express courier service that provides
written confirmation of delivery, to such party at its address as
set forth above in the introductory Paragraph of this Agreement.
Each such notice or other communication shall be deemed given,
delivered and received upon its actual receipt, except that if it
is sent by mail in accordance with this Paragraph, then it shall
be deemed given, delivered and received three days after the date
such notice or other communication is deposited with the United
States Postal Service in accordance with this Paragraph. Any
party to this Agreement may give a notice of a change of its
address to the other party(ies) to this Agreement.
25. Drafting Ambiguities. Each party to this Agreement and
its legal counsel have reviewed and revised this Agreement. The
rule of construction that any ambiguities are to be resolved
against the drafting party shall not be employed in the
interpretation of this Agreement or of any amendments or exhibits
to this Agreement.
26. Effectiveness. This Agreement shall become effective
when it has been executed by all of the parties to this
Agreement.
______________________________ Date:______________________
Officer
OceanTrac, INCORPORATED,
a Canadian corporation
By: _____________________________
Date: _____________________________
Title:_____________________________
EXHIBIT B
DISTRIBUTOR/DEALERS SERVICE AND SALES AGREEMENT
This Service and Sales Agreement ("Agreement") is entered
into effective _______________, 199__, by and between BOATRACS,
INC. a California corporation ("BOATRACS"), having an address for
notices at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
and OCEANTRAC SYSTEMS, LTD, a Canada corporation (the "Company"),
having an address for notices at ▇.▇. ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, BOW 1BO, who agree as follows:
1. Recitals.
1.1. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, a Delaware corporation
("Qualcomm") manufactures and distributes a mobile KU-Band
Satellite Mobile Communications Terminal containing a Satellite
Position Reporting System which is installed on a vehicle and
permits the vehicle to have communication access to, and report
position locating to Qualcomm's Network Management Facility (the
"Qualcomm System").
1.2. Qualcomm has authorized CANCOM/SATLINK BUSINESS
SERVICES, ("Cancom") to market, distribute and operate the
QUALCOMM SYSTEM in Canada.
1.3. Cancom has entered into an agreement with
Boatracs (the "Cancom Agreement") under the terms of which Cancom
has appointed Boatracs to act as its distributor and licensee for
the Qualcomm System for Marine Application (as defined below) in
Canada and Boatracs has modified, adapted and enhanced the
Qualcomm System for Marine Application (the "Boatracs System").
2. Definitions.
2.1. Marine Application" shall mean the vessel and
marine industry, including without limitation, the inland and
offshore shipping, fishing, recreational boating, workboat
industry, vessels used for towing, harbor services,
transportation and supply.
2.2. "End User" shall mean any customer who purchases
any combination of Products for Marine Application.
2.3. "MCT" shall mean a Ku-band satellite Mobile
Communications Terminal containing BOATRACS' Satellite Position
Reporting system which is installed on a Vessel and which permits
the Vessel to have communications access to, and report position
location to QUALCOMM's or CANCOM's Network Management Facility
consisting primarily of the following components:
2.3.1. Outdoor Unit: contains the antenna
assembly and RF electronics;
2.3.2. Communication Unit: contains an analog
section, digital electronics and a local determining device. The
Communication Unit includes means of providing position location
reporting information;
2.3.3. Display Unit: BOATRACS' design for
38 character by four line display containing the indicators for
message waiting and satellite signal and QWERTY keyboard with
several function keys for preprogrammed user functions;
2.3.4. 20-foot power cable; 50-foot antenna cable
pair and 17-foot display cable;
2.3.5. MCT Software: QUALCOMM's or CANCOM's
proprietary software residing within an MCT.
2.4. "Products" shall mean MCT's and Software (as
defined below).
2.5. "Software" shall mean (a) QUALCOMM's, BOATRACS'
or CANCOM's version of the proprietary software which permits an
End User to access and communicate with QUALCOMM's or CANCOM's
Network Management Facility from the End User's computer,
(b) BOATRACS' User Interface for use on a computer installed
aboard a Vessel, or (c) other software developed by BOATRACS or
third parties which is offered or sold by BOATRACS in connection
with the Product.
2.6. "Territory" shall mean the area described on
attached Attachment A.
3. Appointment. BOATRACS hereby appoints the Company to
perform the services set forth in this Agreement and the Company
hereby accepts such appointment upon the terms and conditions set
forth in this Agreement. Such appointment shall be for a term of
one year, commencing on the effective date of this Agreement.
Unless BOATRACS has given notice to the Company of BOATRACS'
termination of this Agreement at least 60 days prior to the end
of the term, the term of this Agreement shall be renewed for one
additional year. Notwithstanding anything to the contrary in
this Paragraph, this Agreement shall be subject to and shall
immediately terminate upon the expiration or earlier termination
of the CANCOM Agreement. BOATRACS shall have no liability to the
Company in the event of a termination of the CANCOM Agreement for
any reason.
4. Minimum Stock and Equipment. The Company shall ensure
that (a) the Company has an inventory of at least one MCT at any
given time, and (b) has a functioning and operational IBM
personal computer or functional compatible with at least a 20MB
hard drive sufficient to enable the Company to demonstrate the
Software.
5. Installation and Service. The Company shall, at the
request of End User, install the Product. The Company shall not
prevent an End User from installing the Product if the End User
so elects. BOATRACS reserves the right to require employees or
representatives of the Company to attend training programs in
connection with the installation, operation or service of the
Product. Neither the Company, nor any employee, representative
or independent contractor of or retained by the Company shall
perform service upon the Product which violates or breaches any
provision of the CANCOM Agreement, including without limitation
the opening of any sealed component of the Product. The Company
shall not service Products, unless (a) BOATRACS has issued its
written certification that the Company is an authorized service
provider, (b) the Company has received verbal authorization and a
work order number as to a particular unit of Product, and (c) the
Company complies with such requirements as to such service that
BOATRACS shall promulgate from time to time. Such certification
as an authorized service provider shall be revocable at any time
at the discretion of BOATRACS. Prior to commencing service, the
Company shall provide BOATRACS with information regarding
improper use, negligent use or any other condition that causes
the repair to be out of warranty.
6. Engineering Improvements. CANCOM, QUALCOMM, and/or
BOATRACS may from time to time make engineering improvements
modifications which it elects to incorporate in Products. These
modifications may be incorporated at the BOATRACS, QUALCOMM or
CANCOM factory or by the Company, as directed by BOATRACS. Such
modifications may be performed simultaneously with repair
service or upon another mutually agreed upon schedule. The
Company will be trained on these services at no cost to the
Company.
7. Limited Warranty and Limitations on Liability.
7.1. The Company acknowledges that the range of
service to be provided to End Users via the Product extends
within a limited geographical area of approximately 200 to 400
miles off the shores of the continental United States. The
Company acknowledges that one of the ANIK satellites is
anticipated to be brought online to provide additional coverage
in Canada and that the extent or range of such coverage is
unknown as of the date of this Agreement.
7.2. The Company shall not make any representation or
warranty to End Users other than those which are specifically
authorized in writing by BOATRACS. The Company acknowledges that
it has been provided with a copy of the standard warranties
provided by (a) CANCOM pursuant to the CANCOM Agreement, with
respect to CANCOM's proprietary software, (b) BOATRACS, with
respect to BOATRACS' proprietary software and User Interface
Software, and (c) QUALCOMM, with respect to QUALCOMM's
proprietary software, and that such standard warranties are
summarized on attached Attachment B. CANCOM, QUALCOMM and/or
BOATRACS may modify or amend such warranties from time to time
and in the event of any inconsistency between the terms of any
such modified and/or amended warranty and the summary of such
warranty on attached Attachment B, the terms of such modified
and/or amended warranty shall prevail. The Company acknowledges
that other than the warranties explicitly provided for by this
Agreement, neither BOATRACS, QUALCOMM or CANCOM has made any
warranty or representation to the Company regarding the Product,
CANCOM's proprietary software, QUALCOMM's proprietary software or
BOATRACS' proprietary software or User Interface Software.
7.3. BOATRACS shall not be liable to the Company for,
the Company hereby assumes all risk of, and the Company waives
all claims against BOATRACS in respect of, any damage in excess
of U.S. $5,000.00 (whether based upon contract, tort, negligence,
warranty, product liability, strict liability, equitable
indemnification and/or otherwise and whether or not BOATRACS has
been notified of the possibility of such damage) resulting from,
or arising out of, the Product, use or performance of the
Product, loss of use, lost data, lost profits, consequential
damages, incidental damages, special damages, malfunction of the
Product, or any other matter relating to the Product and/or this
Agreement.
8. Extended Warranty. BOATRACS may offer a "three-year on-
the-sea extended warranty" on such terms and conditions as
BOATRACS shall determine and which shall provide, inter alia, for
the purchaser of such warranty to be entitled to the replacement
of defective parts within 72 hours, subject to certain terms and
conditions. The current cost of such warranty per MCT shall be
the sum of * but shall be subject to change by BOATRACS, upon
written notice. The amount of * shall be allocated as follows:
(a) BOATRACS: * per year per MCT.
(b) The Company: * per year per MCT.
The Company shall provide all mounting and demounting services
required in order to perform in accordance with such warranty.
The Company will render services to an End User but shall not be
obligated to render more than four hours' labor with respect to
MCT's not sold by the Company. BOATRACS shall reimburse the
Company for up to four hours of such labor performed on units not
sold by the Company at an hourly rate not exceeding U.S. * per
hour, providing BOATRACS has authorized such labor in writing.
The Company shall invoice BOATRACS for such labor which shall be
paid by BOATRACS within seven working days of receipt of such
invoice. All shipping and installation charges shall be for the
account of the End User.
9. Relationship of Parties. The Company is acting as an
independent contractor and not as an agent or an employee of
BOATRACS in the performance of the services to be performed
hereunder. The Company retains authority to control and direct
the performance of the details of the services to be performed;
provided, however, that the services to be performed meet such
requirements that the Company may promulgate from time to time.
Neither the Company nor any agent, employee, officer or
independent contractor of or retained by the Company shall become
or be deemed an employee, partner, joint venturer or agent of or
with BOATRACS by reason of this Agreement. Neither BOATRACS nor
the Company (nor any agent, employee, officer or independent
contractor of or retained by the Company) shall have any
authority to bind the other in any respect.
10. Legal. The parties to this Agreement agree to comply
with all United States and Canada federal, state, provincial, and
municipal laws, rules and regulations that are now or may in the
future become applicable.
11. Confidential Information.
11.1. Trademarks and Trade Names. Nothing contained
in this Agreement shall be construed to authorize the Company
(a) to use any trademark or trade name of BOATRACS, QUALCOMM
and/or CANCOM (the "Marks") as a style or name, or as part of the
style or name of any firm, partnership or corporation, (b) to
apply the Marks to any goods other than Products, or (c) at any
time after the expiration or sooner termination of this
Agreement, to apply the Marks to goods or to any other use
whatsoever. The Company shall use the Marks only in association
with the Products and only in strict accordance with the
instructions, standards of quality and trade-▇▇▇▇ specifications
supplied by BOATRACS from time to time.
11.2. Proprietary Interest. The Company recognizes
the proprietary interest of BOATRACS, QUALCOMM and CANCOM in
technical data, marketing and confidential business information
provided by BOATRACS to, or otherwise discovered by, the Company
from time to time. The Company acknowledges and agrees that such
information constitutes trade secrets of BOATRACS, QUALCOMM and
CANCOM, respectively. The Company acknowledges and agrees that
any and all such information shall be and is the property of
BOATRACS, QUALCOMM and/or CANCOM. The Company hereby waives any
and all right, title or interest in and to such information and
agrees to promptly return all copies of such information to
BOATRACS, at the Company's expense, upon termination of this
Agreement.
11.3. Confidentiality. The Company acknowledges and
agrees that BOATRACS is entitled to prevent its competitors from
obtaining and utilizing its trade secrets. The Company agrees to
hold BOATRACS', QUALCOMM's and CANCOM's trade secrets in
strictest confidence and not to disclose them or allow them to be
disclosed, directly or indirectly, to any other person or entity,
other than to persons engaged by the Company for the purpose of
performance under this Agreement, with BOATRACS' prior written
consent. The Company acknowledges its fiduciary obligations to
BOATRACS and the confidential nature of its relationship with
BOATRACS and of any confidential proprietary information or trade
secrets which the Company may obtain during the terms of this
Agreement. The Company shall not, either during the term of this
Agreement or at any time after the expiration or earlier
termination of this Agreement, or during any extension thereof,
disclose to anyone, other than persons engaged by it for the
purpose of performing under this Agreement, any confidential or
proprietary information or trade secrets of BOATRACS obtained by
the Company. The Company also agrees to place upon any persons
to whom said information is disclosed for the purpose of
performance under this Agreement, a legal obligation to treat
such information as strictly confidential.
12. Insurance to be Secured. The Company agrees to
maintain such insurance as will fully protect both the Company
and BOATRACS from any and all claims under any ▇▇▇▇▇▇▇'▇
compensation or similar act or employee's liability laws, and
from any and all other claims of whatsoever kind or nature for
the damage to property or for personal injury, including death,
made by anyone whomsoever, that may arise from operations carried
on under this Agreement, either by the Company, any subcontractor
or anyone directly or indirectly engaged or employed by either of
them. BOATRACS shall be named as an additional insured under all
such policies. The Company agrees to provide BOATRACS with
copies of such policies and certificates evidencing the required
coverage before the Company begins service requested by BOATRACS.
13. Parts & Special Tools. The Company agrees to provide
tooling necessary to perform installation and/or servicing of
MCT's, if any.
14. Right to Sell Products. The Company shall purchase the
Product from BOATRACS and BOATRACS hereby grants to the Company
the exclusive right with the Territory to resell the Product to
End Users subject to the terms of the CANCOM Agreement. Such
exclusivity shall not include Weston Foods and the Federal
Department of Fisheries and Oceans (one BC-based vessel) who are
presently Satlink clients. The purchase price paid by the
Company for the Product shall be the most recent Canadian
distributor prices published by BOATRACS from time to time. The
initial distributor prices for the Product are set forth on
Attachment C to this Agreement, such prices being subject to
change from time to time without notice from BOATRACS. The
Company shall determine the prices of the Product to be sold by
the Company to End Users. The Company shall not be entitled to
receive any form of commission from BOATRACS arising from such
resale of Product to End Users. BOATRACS reserves the right to
change the price and sales conditions at any time upon notice to
the Company. The purchase price for units of the Product ordered
by the Company shall be payable in full in cash within 15 days
from the date of shipment. Units of the Product ordered by the
Company shall be shipped FOB point of shipment. The Company
acknowledges that the risk of loss or damage to the units of
Product shall shift to the Company upon delivery by BOATRACS or
CANCOM of the units of Product to the carrier. Such carrier
shall be deemed to be the agent of the Company and not BOATRACS
or CANCOM. The Company acknowledges that neither BOATRACS nor
CANCOM shall be responsible for loss or damage to the Product
during transit and that it is the Company's responsibility to
obtain insurance coverage against loss or damage to the Product
during transit.
15. Sub-Dealers.
15.1. The Company may, at its election, appoint
additional dealers to sell the Product within the Territory
("Sub-Dealers"). All such appointments of Sub-Dealers made by
the Company shall be terminable, with or without cause, by no
more than 60 days' notice, and shall terminate automatically upon
the termination of this Agreement. The rights of such
Sub-Dealers shall be subject to the provisions of this Agreement.
Neither the Company nor such Sub-Dealers shall take any action
that may violate the provisions of the CANCOM Agreement. The
Company shall, immediately upon notice from BOATRACS, terminate
the appointment of any Sub-Dealer that BOATRACS, in its sole
discretion, determines is not in the best interests of BOATRACS.
15.2. Potential Sub-Dealers shall be required to
complete an application process and the appointment of such
potential Sub-Dealers shall be subject to the approval of
BOATRACS, in its reasonable discretion.
16. Per-Message Commission. While this Agreement is in
full force and effect, (a) on or before August 31 of each year,
BOATRACS shall pay to Company that portion (identified in the
table below as the Relevant Fee) of the Authorized Message
Charges (as defined below) actually paid to and received by
BOATRACS from each Qualified End User (as defined below) during
the period commencing on the immediately preceding January 1 and
ending on the immediately preceding June 30, and (b) on or before
February 28 of each year BOATRACS shall pay to Company the
Relevant Fee portion of the Authorized Message Charges actually
paid to and received by BOATRACS from each Qualified End User
during the period commencing on the immediately preceding July 1
and ending on the immediately preceding December 31. For
purposes of this Paragraph, (a) "Qualified End User" shall mean
an End User who uses an MCT unit sold to such End User by Company
or any Sub-Dealer appointed by the Company for such message
transmission and is a subscriber to BOATRACS' monitoring system
at the time such message was transmitted, (b) "Authorized Message
Charge" shall mean the fees payable to BOATRACS by Qualified End
Users as message charges, and (c) "Relevant Fee" shall mean the
fees set forth in the column labeled "Relevant Fee" below for
message services.
Message Charges
*
Authorized Message BOATRACS fee Relevant Fee
Charge
Base Charge/mo./unit
Per Message
Per Character
Monitoring/mo/unit
Macro Definition/ea
Group Definition/ea
(The above amounts are in Canadian Dollars)
BOATRACS determination of the compensation payable pursuant to
this Paragraph shall be final, binding and conclusive. Company
shall not increase the Authorized Message Charges set forth above
without BOATRACS' prior written approval.
17. Indemnification. The Company shall indemnify BOATRACS
against all Claims (as defined below) and all costs, expenses and
attorney's fees incurred in the defense of any of such Claims or
any action or proceeding brought on any of such Claims. For
purposes of this Paragraph, "Claims" shall mean all liabilities,
damages, losses, costs, expenses, attorney's fees and claims,
arising from (a) any activity, work or thing done, permitted or
suffered by the Company in connection with the Company's
marketing, installation, and/or sales of the Product, (b) any
breach or default in the performance of any obligation to be
performed by the Company under this Agreement, (c) any breach of
any representation or warranty of the Company set forth in this
Agreement, (d) any dispute with a Subdealer, or (d) any
negligence of the Company or any agent, employee, officer,
contractor, representative, guest, licensee, invitee, visitor or
customer of or retained by the Company. Notwithstanding the
foregoing, "Claims" shall not include any liability, damage, or
loss which is caused solely by BOATRACS's grossly negligent act,
wilful misconduct or breach under this Agreement. If any action
or proceeding is brought against BOATRACS by reason of any such
Claims, the Company upon notice from BOATRACS shall defend such
action or proceeding at the Company's sole cost by legal counsel
satisfactory to BOATRACS.
18. Canadian Provisions. All amounts of money set forth in
this Agreement are in Canadian dollars. The parties expressly
declare that they require this Agreement and all documents,
correspondence and notices relating to this Agreement to be
drafted and written exclusively in the English language. Les
parties declarent expressement qu'elles exigent que ce contrat
ainsi que tous les documents, correspondence et avis y relatifs
soient rediges et ecrits exclusivement en anglais.
19. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California,
United States of America.
20. Further Assurances. Each party to this Agreement shall
execute all instruments and documents and take all actions as may
be reasonably required to effectuate this Agreement.
21. Venue and Jurisdiction. For purposes of venue and
jurisdiction, this Agreement shall be deemed made and to be
performed in the City of San Diego, California.
22. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original and all
of which together shall constitute one document.
23. Time of Essence. Time and strict and punctual
performance are of the essence with respect to each provision of
this Agreement.
24. Attorney's Fees. In the event any litigation,
arbitration, mediation, or other proceeding ("Proceeding") is
initiated by any party against any other party to enforce,
interpret or otherwise obtain judicial or quasi-judicial relief
in connection with this Agreement, the prevailing party in such
Proceeding shall be entitled to recover from the unsuccessful
party all costs, expenses, and actual attorney's fees relating to
or arising out of (a) such Proceeding (whether or not such
Proceeding proceeds to judgment), and (b) any post-judgment or
post-award proceeding including without limitation one to enforce
any judgment or award resulting from any such Proceeding. Any
such judgment or award shall contain a specific provision for the
recovery of all such subsequently incurred costs, expenses, and
actual attorney's fees.
25. Modification. This Agreement may be modified only by a
contract in writing executed by the party(ies) to this Agreement
against whom enforcement of such modification is sought.
26. Headings. The headings of the Paragraphs of this
Agreement have been included only for convenience, and shall not
be deemed in any manner to modify or limit any of the provisions
of this Agreement, or be used in any manner in the interpretation
of this Agreement.
27. Prior Understandings. This Agreement contains the
entire agreement between the parties to this Agreement with
respect to the subject matter of this Agreement, is intended as a
final expression of such parties' agreement with respect to such
terms as are included in this Agreement, is intended as a
complete and exclusive statement of the terms of such agreement,
and supersedes all negotiations, stipulations, understandings,
agreements, representations and warranties, if any, with respect
to such subject matter, which precede or accompany the execution
of this Agreement.
28. Interpretation. Whenever the context so requires in
this Agreement, all words used in the singular shall be construed
to have been used in the plural (and vice versa), each gender
shall be construed to include any other genders, and the word
"person" shall be construed to include a natural person, a
corporation, a firm, a partnership, a joint venture, a trust, an
estate or any other entity.
29. Partial Invalidity. Each provision of this Agreement
shall be valid and enforceable to the fullest extent permitted by
law. If any provision of this Agreement or the application of
such provision to any person or circumstance shall, to any
extent, be invalid or unenforceable, the remainder of this
Agreement, or the application of such provision to persons or
circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected by such invalidity or
unenforceability, unless such provision or such application of
such provision is essential to this Agreement.
30. Successors-in-Interest and Assigns. The Company shall
not assign or delegate to any other person this Agreement or any
rights or obligations under this Agreement. Subject to any
restriction on transferability contained in this Agreement, this
Agreement shall be binding upon and shall inure to the benefit of
the successors-in-interest and assigns of each party to this
Agreement. Nothing in this Paragraph shall create any rights
enforceable by any person not a party to this Agreement, except
for the rights of the successors-in-interest and assigns of each
party to this Agreement, unless such rights are expressly granted
in this Agreement to other specifically identified persons.
31. Notices. All notices or other communications required
or permitted to be given to a party to this Agreement shall be in
writing and shall be personally delivered, sent by certified
mail, postage prepaid, return receipt requested, or sent by an
overnight express courier service that provides written
confirmation of delivery, to such party at its address as set
forth above in the introductory Paragraph of this Agreement.
Each such notice or other communication shall be deemed given,
delivered and received upon its actual receipt, except that if it
is sent by mail in accordance with this Paragraph, then it shall
be deemed given, delivered and received three days after the date
such notice or other communication is deposited with the United
States Postal Service in accordance with this Paragraph. Any
party to this Agreement may give a notice of a change of its
address to the other party to this Agreement.
32. Waiver. Any waiver of a default under this Agreement
must be in writing and shall not be a waiver of any other default
concerning the same or any other provision of this Agreement. No
delay or omission in the exercise of any right or remedy shall
impair such right or remedy or be construed as a waiver. A
consent to or approval of any act shall not be deemed to waive or
render unnecessary consent to or approval of any other or
subsequent act.
33. Drafting Ambiguities. Each party to this Agreement and
its legal counsel have reviewed and revised this Agreement. The
rule of construction that any ambiguities are to be resolved
against the drafting party shall not be employed in the
interpretation of this Agreement or of any amendments or exhibits
to this Agreement.
34. Effectiveness. This Agreement shall become effective
when it has been executed by all of the parties to this
Agreement.
BOATRACS, INC. a California
corporation
By:___________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chief Operating
Officer
OCEANTRAC SYSTEMS, LTD, a Canada
corporation
By:_________________________________
By:_________________________________
Addendum to Distributor/Dealers
Service And Sales Agreement
1. Sales Leads. BOATRACS shall endeavor to forward to the
Company those sales leads which BOATRACS receives from potential
customers in the Territory.
2. Marketing, Sales and Advertising Expenditures. BOATRACS
may, at its election and with no obligation to do so, incur
certain marketing, sales and advertising expenses to assess or
enhance the market potential for the Product within the
Territory. Upon the mutual written agreement of both parties,
BOATRACS and the Company may elect to share the expenses related
to a cooperative advertising campaign for the Product within the
Territory.
ATTACHMENT A
Territory
As used in the Agreement to which this Attachment is a part,
"Territory" shall mean the Canadian provinces of Ontario, Quebec,
New Brunswick, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Island, Nova Scotia, Labrador, and
Newfoundland.
ATTACHMENT B
Summary of Standard Warranties
A summary of standard warranties will be provided to the Company
by BOATRACS. Those standard warranties are subject to change
from time to time without notice from Boatracs.
ATTACHMENT C
PRICING (1)
*
ON THE VESSEL:
Price(2) Dealer(3) Retailer(4)
1. BOATRACS Mobile Communications
Terminal (MCT)
Includes Communications Unit,
Keyboard, Standard Antenna
Unit Price Quantities 1-9
Unit Price Quantities 10 or more
2. SatCom License Fee per year,
per MCT
3. On Board Printer
4. Extended Warranty per MCT
(per unit per year)
5. Evaluation Fee
(per MCT per month)
IN THE OFFICE:
1. QTRACS (PC) Software
(does not include modem
or PC)
2. QTRACS Lan DOS (1-40 units)
3. QTRACS Windows
(when available)
4. QTRACS DOS/Windows
Sub-account (1st copy)
5. QTRACS DOS/Windows
Sub-account (all other copies)
6. QTRACS Annual Service Fee
7. BOATCOMM User Interface (▇▇▇)
8. Seasonal Disconnect/Reconnect
Fee (per MCT)
9. 24 Hour Dispatch Option
(per Fleet/month)
_______________________________
(1) All prices are stated in Canadian Dollars and are subject to change
without further notice.
(2) Price from BOATRACS to OceanTRAC
(3) Suggested price from OceanTRAC to Dealers
(4) Suggested price from Dealer to Customers
EXHIBIT C
SECURED PROMISSORY NOTE
Original Principal Amount $78,000.00 U.S. Date:
December 20, 1995
FOR VALUE RECEIVED, OCEANTRAC SYSTEMS LIMITED., a Nova
Scotia corporation and OCEANTRAC INCORPORATED, a Canadian
corporation, jointly and severally, (collectively "Maker")
promises to pay to BOATRACS, INC., a California corporation, or
order ("Holder"), at San Diego, California (or such other address
designated by Holder from time to time), the sum of Seventy Eight
Thousand U.S. Dollars ($78,000.00 U.S.), plus any additional
advances or loans made by Holder to Maker, in Holder's sole and
absolute discretion, plus interest thereon, from the date hereof
until all amounts due hereunder are paid in full, at the rate of
nine percent (9%) per annum, payable as more fully set forth
below.
1. Due on Demand. All unpaid principal and accrued
interest under this Note shall be immediately due and payable
seven days after written demand from Holder to Maker.
2. Manner of Payments. All payments by Maker under this
Note shall be (i) made in lawful money of the United States of
America without set-off, deduction or counterclaim of any kind
whatsoever (ii) credited first to amounts for late charges, if
any, second to amounts for Holder's costs of enforcing this Note,
if any, third to amounts of interest due (including default
interest) hereunder, if any, and finally to the principal balance
under this Note, and (iii) deemed paid by Maker upon their actual
receipt by Holder.
3. Prepayment. Maker has the right to prepay the principal
amount of this Note at any time without penalty.
4. Late Charge. If any amount of interest and/or principal
under this Note is not received by Holder upon the due date then,
without any requirement for notice to Maker, Maker shall immedi
ately pay to Holder an additional sum of five percent (5%) of
such overdue amount as a late charge. Such late charge is fair
and reasonable based upon the facts and circumstances existing as
of the date of this Note. Acceptance of such late charge by
Holder shall not constitute a waiver of Maker's default with
respect to such overdue amount, nor prevent Holder from
exercising any of the other rights and remedies available to
Holder under this Note.
5. Acceleration. All unpaid principal and accrued and
unpaid interest under this Note shall, at Holder's election, be
immediately due and payable upon the occurrence of any failure by
Maker to timely satisfy all of its obligations under this Note,
any other Note or Agreement made by either Maker (including,
without limitation, under the Agreement entered into among
OCEANTRAC INCORPORATED, OCEANTRAC SYSTEMS LIMITED and Holder,
evenly dated herewith and all Exhibits thereto.
6. Security. This Note is secured by a Pledge evenly dated
with this Note from Maker to Holder and naming ▇▇▇▇▇▇▇ ▇▇▇▇
Seidenwurm & ▇▇▇▇▇ as Pledge Holder.
7. Commercial Purposes. Maker acknowledges that the loan
evidenced by this Note is obtained for business or commercial
purposes and that the proceeds of such loan will not be used
primarily for personal, family, household or agricultural
purposes.
8. Interest Limitation. It is not intended by any
provision of this Note to charge interest at a rate in excess of
the maximum rate of interest permitted to be charged to Maker
under applicable law on a cumulative basis over the life of the
loan evidenced by this Note (the "Loan"). If by mistake or
error, interest in excess of such maximum rate shall be paid for
any period during the term of the Loan, the excess amount shall,
if permitted by applicable law, be retained by Holder as
additional cash collateral for the Loan to be held without
interest or trust and commingled with other assets of Holder or,
if not permitted to be so held by Holder, shall be refunded to
Maker. If for any period during the term of the Loan, Holder is
unable, because of a limitation on the rate of interest permitted
to be charged to Maker under applicable law, to collect all of
the interest and premium provided for in this Note, such interest
or premium ("interest shortage") shall, if permitted by
applicable law, be added to the interest earned or to be earned
for prior or subsequent periods during the term of the Loan so
that, to the extent permitted by applicable law on a cumulative
basis over the life of the Loan, Holder may collect all of the
interest and premium provided for in this Note, the same to be
accomplished in the following manner, or otherwise as permitted
by applicable law: (i) if Holder were permitted by applicable
law to charge interest to Maker in such prior periods in excess
of the amount of interest and premium actually charged during
such prior periods, then the interest due on the Loan for such
prior periods shall automatically be increased by the amount of
such interest shortage, but not in excess of the maximum interest
permitted to be charged to Maker during such prior periods, and
such increased interest for such prior periods shall be
immediately due and payable upon demand; and (ii) if Holder shall
have collected all interest permitted by applicable law to be
charged to Maker in such prior periods, and if Holder is
thereafter permitted by applicable law to charge interest to
Maker in such subsequent periods in excess of the amount of
interest and premium actually charged during such subsequent
periods, the interest due on the Loan for such subsequent periods
shall automatically be increased by the amount of such interest
shortage, but not in excess of the maximum interest permitted to
be charged to Maker during such subsequent period, and such
increased interest for such subsequent periods shall be due and
payable at the end of each such subsequent period upon demand.
9. Note Waivers. Maker waives presentment, notice,
demand, protest, notice of demand and dishonor.
10. Governing Law. This Note shall be governed by and
construed in accordance with the laws of the State of California.
11. Further Assurances. Each party to this Note shall
execute all instruments and documents and take all actions as may
be reasonably required to effectuate this Note.
12. Venue and Jurisdiction. All actions and proceedings
arising in connection with this Note must be tried and litigated
exclusively in the State and Federal courts located in the County
of San Diego, State of California, which courts have personal
jurisdiction and venue over each of the parties to this Note for
the purpose of adjudicating all matters arising out of or related
to this Note. Each party authorizes and accepts service of
process sufficient for personal jurisdiction in any action
against it as contemplated by this paragraph by registered or
certified mail, return receipt requested, postage prepaid, to its
address for the giving of notices set forth in this Note.
13. Time of Essence. Time and strict and punctual
performance are of the essence with respect to each provision of
this Note.
14. Attorney's Fees. In the event any litigation,
arbitration, mediation, or other proceeding ("Proceeding") is
initiated by any party against any other party to enforce,
interpret, collect upon, foreclose, or otherwise obtain judicial
or quasi-judicial relief in connection with this Note, the
prevailing party in such Proceeding shall be entitled to recover
from the unsuccessful party all costs, expenses, and actual
attorney's fees relating to or arising out of (i) such Proceeding
(whether or not such Proceeding proceeds to judgment), and (ii)
any post-judgment or post-award proceeding including without
limitation one to enforce any judgment or award resulting from
any such Proceeding. Any such judgment or award shall contain a
specific provision for the recovery of all such subsequently
incurred costs, expenses, and actual attorney's fees.
15. Modification. This Note may be modified only by a
contract in writing executed by the party to this Note against
whom enforcement of such modification is sought.
16. Headings. The headings of the Paragraphs of this Note
have been included only for convenience, and shall not be deemed
in any manner to modify or limit any of the provisions of this
Note, or be used in any manner in the interpretation of this
Note.
17. Waiver. Any waiver of a default under this Note must
be in writing and shall not be a waiver of any other default
concerning the same or any other provision of this Note. No
delay or omission in the exercise of any right or remedy shall
impair such right or remedy or be construed as a waiver. A
consent to or approval of any act shall not be deemed to waive or
render unnecessary consent to or approval of any other or
subsequent act.
18. Drafting Ambiguities. Maker and his legal counsel have
reviewed and had an opportunity to negotiate the terms of this
Note. The rule of construction that any ambiguities are to be
resolved against the drafting party shall not be employed in the
interpretation of this Note.
19. Notices. All notices of other communications required
or permitted to be given to a party to this Note shall be in
writing and shall be personally delivered, sent by certified
mail, postage paid, return receipt requested, or sent by an
overnight express courier service that provides written
confirmation of delivery, to such party at the following
respective address:
Holder: BOATRACS, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇-▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
OCEANTRAC SYSTEMS LIMITED
▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
OCEANTRAC INCORPORATED
▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Each such notice or other communication shall be deemed given,
delivered and received upon its actual receipt, except that if it
is sent by mail in accordance with this paragraph, then it shall
be given, delivered and received three days after the date such
notice or other communication is deposited with the United States
Postal Service in accordance with this Paragraph. Any party to
this Note may give notice of a change of its address to the other
party(ies) to this Note.
OCEANTRAC SYSTEMS LIMITED., a Canadian
corporation, Maker
By: ______________________________
Its: ______________________________
By: ______________________________
Its: ______________________________
OCEANTRAC INCORPORATED, a Canadian
corporation, Maker
By: ______________________________
Its: ______________________________
By: ______________________________
Its: ______________________________
EXHIBIT D
PLEDGE AGREEMENT
This Agreement is executed effective January ___, 1996
between BOATRACS, INC., a California corporation, having an
address for notices at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇-▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ("Pledgee") and OCEANTRAC SYSTEMS LIMITED,
a Nova Scotia corporation, having an address for notices at
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
("Pledgor"), who agree as follows:
1. Recital. This Agreement is made with reference to the
following recital of essential facts:
1.1. Pledgor and Pledgee have executed an agreement
(the "Agreement") dated the same date as this Pledge Agreement.
Pursuant to the Agreement, Pledgor has executed two promissory
notes (collectively "the Note") in favor of Pledgee.
1.2. In order to secure Pledgor's payment obligations
under the Note, Pledgor has agreed to pledge to Pledgee all of
the shares (the "Shares") held by Pledgor in OCEANTRAC,
INCORPORATED, a Canadian corporation.
2. Grant of Security Interest. To secure Pledgor's payment
obligations to Pledgee under the Note, Pledgor pledges, assigns
and grants to Pledgee a security interest in (a) the Shares and
(b) all stock or cash dividends, substitutions, and shares issued
pursuant to any merger or reorganization, or any other proceeds
of such Shares as defined in Section 9306 of the California
Uniform Commercial Code.
3. Delivery of Shares. Upon Pledgor's execution of this Pledge
Agreement, Pledgor shall concurrently validly endorse the Shares
in blank and deliver the Shares to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., of
▇▇▇▇▇▇▇ ▇▇▇▇ Seidenwurm & ▇▇▇▇▇ (the "Pledgeholder").
Pledgeholder shall retain the Shares to secure Pledgor's
obligations to Pledgee under this Agreement.
4. Terms of Pledge. The Shares shall be held by Pledgeholder
in pledge subject to the terms and conditions of this Agreement.
As long as no default exists as described in Paragraph 7 below,
Pledgor shall have the right at all times to vote such Shares on
any and all matters. Pledgor and Pledgee shall indemnify
Pledgeholder and hold him harmless from any loss, expense or
damage he may incur by virtue of his role as Pledgeholder, except
for any breach of duty or negligence of Pledgeholder.
5. Negative Covenants. Until all obligations secured by this
Pledge Agreement shall have been fully and finally performed,
Pledgor shall not without the prior written consent of
Pledgee: (a) create or suffer to exist any further security
interest in the Shares; or (b) sell or otherwise dispose of the
Shares.
6. Affirmative Covenants. Until all obligations secured by
this Agreement shall have been fully and finally performed,
Pledgor shall pay when due all taxes, assessments, and liens, if
any, upon the Shares. Pledgor may withhold any such payment or
may elect to contest any lien if Pledgor is in good faith
conducting appropriate proceedings to contest the obligation to
pay, so long as Pledgee's interest in the Shares is not
jeopardized. In any such contest, Pledgor shall represent itself
and Pledgee and shall satisfy any final adverse judgment before
enforcement against the Shares. Pledgor shall name Pledgee as an
additional obligee under any surety bond furnished in the contest
proceedings.
7. Events of Default. Pledgor shall be in default under this
Agreement upon the occurrence of any of the following events:
7.1. Pledgor's breach of this Agreement, which breach is
not cured within 5 days of written notice to Pledgor of such
breach.
7.2. Any amount due under the Note is not received by
Pledgee on its due date.
7.3. Any actual disposition of the Shares in violation of
this Agreement.
7.4. The making by Pledgor of any general arrangement or
assignment for the benefit of creditors; Pledgor becoming
bankrupt, insolvent or a "debtor" as defined in 11 U.S.C.
Section 101, or any successor statute or similar statute or law
in Canada (unless, in the case of a petition filed against
Pledgor, such petition is dismissed within 30 days after its
original filing); the appointing of a trustee or receiver to take
possession of substantially all of Pledgor's assets (unless
possession is restored to Pledgor within 30 days after such
taking); or the attachment, execution or judicial seizure of
substantially all of Pledgor's assets (unless such attachment,
execution or judicial seizure is discharged within 30 days after
such attachment, execution or judicial seizure).
8. Rights of Pledgee Upon Default. Should a default occur
under Paragraph 7 above (the "Default"), Pledgee shall give
Pledgeholder written notice and full details of such Default.
Immediately following the receipt of such written notice of
Default, Pledgeholder may exercise any of the following remedies
with regard to the Shares on behalf of Pledgee:
8.1. Vote, grant proxies, attend shareholder meetings,
nominate and elect directors, receive dividends and other
distributions to shareholders, and otherwise exercise any rights
attributable to the Shares.
8.2. Cause the Shares to be transferred to Pledgee on the
books of Pledgor, in accordance with the stock transfer form
executed by Pledgor in connection with the delivery of the
Shares.
8.3. Cause the Shares to be sold at public or private sale
(the "Sale"). Proceeds from such Sale, net of reasonable
expenses of sale including attorney's fees and legal expenses
incurred by the Pledgeholder, sufficient to cure the Default,
shall be forwarded to Pledgee. Any proceeds in excess of the
amount sufficient to cure the Default shall be immediately
forwarded to Pledgor. If Pledgee instructs Pledgeholder to sell
the Shares and if the net proceeds of such Sale are insufficient
to cure the Default, Pledgee may exercise any other rights and
remedies afforded to secured parties under the California Uniform
Commercial Code, or otherwise in law or equity. All such rights
and remedies shall be cumulative and may be exercised singularly
or concurrently.
Notwithstanding the foregoing, Pledgee acknowledges that in the
event of a non-monetary default described in Paragraph 7.1 above,
Pledgee must liquidate its damages by a judicial determination
before the Sale shall occur. Notwithstanding the foregoing, if
Pledgor cures any Default prior to the Sale, Pledgeholder shall
cause the Sale not to occur.
9. Conflicting Demands. If conflicting demands are made upon
Pledgeholder, he shall have the right (a) to file an action in
interpleader with a court of competent jurisdiction, and (b) to
be reimbursed by Pledgor and/or Pledgee for any and all costs,
expenses and attorneys' fees reasonably incurred in connection
with such action as determined by such court, except to the
extent of any breach of duty or negligence of Pledgeholder.
10. Return of Shares/Note. Upon Pledgor's performance of all
of its obligations under this Agreement, Pledgeholder shall
return the Shares to Pledgor and the Note marked "PAID."
11. Representations and Warranties of Pledgor. Pledgor
represents and warrants to Pledgee that except for the security
interest created by this Agreement, no person or entity has any
right, title, interest, or claim in or to the Shares or any part
of the Shares.
12. Governing Law. This Agreement is governed by and construed
in accordance with the laws of the State of California,
irrespective of California's choice-of-law principles.
13. Further Assurances. Each party to this Agreement shall
execute and deliver all instruments and documents and take all
actions as may be reasonably required or appropriate to carry out
the purposes of this Agreement.
14. Venue and Jurisdiction. All actions and proceedings
arising in connection with this Agreement must be tried and
litigated exclusively in the State and Federal courts located in
the County of San Diego, State of California, which courts have
personal jurisdiction and venue over each of the parties to this
Agreement for the purpose of adjudicating all matters arising out
of or related to this Agreement. Each party authorizes and
accepts service of process sufficient for personal jurisdiction
in any action against it as contemplated by this paragraph by
registered or certified mail, return receipt requested, postage
prepaid, to its address for the giving of notices set forth in
this Agreement.
15. Counterparts and Exhibits. This Agreement may be executed
in counterparts, each of which is deemed an original and all of
which together constitute one document. All exhibits attached to
and referenced in this Agreement are incorporated into this
Agreement.
16. Time of Essence. Time and strict and punctual performance
are of the essence with respect to each provision of this
Agreement.
17. Attorney's Fees. The prevailing party(ies) in any
litigation, arbitration, mediation, bankruptcy, insolvency or
other proceeding ("Proceeding") relating to the enforcement or
interpretation of this Agreement may recover from the
unsuccessful party(ies) all costs, expenses, and actual
attorney's fees (including expert witness and other consultants'
fees and costs) relating to or arising out of (a) the Proceeding
(whether or not the Proceeding proceeds to judgment), and (b) any
post-judgment or post-award proceeding including, without
limitation, one to enforce or collect any judgment or award
resulting from the Proceeding. All such judgments and awards
shall contain a specific provision for the recovery of all such
subsequently incurred costs, expenses, and actual attorney's
fees.
18. Modification. This Agreement may be modified only by a
contract in writing executed by the party to this Agreement
against whom enforcement of the modification is sought.
19. Headings. The paragraph headings in this Agreement: (a)
are included only for convenience, (b) do not in any manner
modify or limit any of the provisions of this Agreement, and (c)
may not be used in the interpretation of this Agreement.
20. Prior Understandings. This Agreement and all documents
specifically referred to and executed in connection with this
Agreement: (a) contain the entire and final agreement of the
parties to this Agreement with respect to the subject matter of
this Agreement, and (b) supersede all negotiations, stipulations,
understandings, agreements, representations and warranties, if
any, with respect to such subject matter, which precede or
accompany the execution of this Agreement.
21. Interpretation. Whenever the context so requires in this
Agreement, all words used in the singular may include the plural
(and vice versa) and the word "person" includes a natural person,
a corporation, a firm, a partnership, a joint venture, a trust,
an estate or any other entity. The terms "includes" and
"including" do not imply any limitation. For purposes of this
Agreement, the term "day" means any calendar day and the term
"business day" means any calendar day other than a Saturday,
Sunday or any other day designated as a holiday under California
Government Code Sections 6700-6701. Any act permitted or
required to be performed under this Agreement upon a particular
day which is not a business day may be performed on the next
business day with the same effect as if it had been performed
upon the day appointed. No remedy or election under this
Agreement is exclusive, but rather, to the extent permitted by
applicable law, each such remedy and election is cumulative with
all other remedies at law or in equity.
22. Partial Invalidity. Each provision of this Agreement is
valid and enforceable to the fullest extent permitted by law. If
any provision of this Agreement (or the application of such
provision to any person or circumstance) is or becomes invalid or
unenforceable, the remainder of this Agreement, and the
application of such provision to persons or circumstances other
than those as to which it is held invalid or unenforceable, are
not affected by such invalidity or unenforceability unless such
provision or the application of such provision is essential to
this Agreement.
23. Successors-in-Interest and Assigns. Pledgor may not
voluntarily or by operation of law assign, hypothecate, delegate
or otherwise transfer or encumber all or any part of its rights,
duties or other interests in this Agreement without the prior
written consent of Pledgee, which consent may be withheld in
Pledgee's sole and absolute discretion. Any such transfer in
violation of this paragraph is void. Subject to the foregoing
and any other restrictions on transferability contained in this
Agreement, this Agreement is binding upon and inures to the
benefit of the successors-in-interest and assigns of each party
to this Agreement.
24. Notices. Each notice and other communication required or
permitted to be given under this Agreement ("Notice") must be in
writing. Notice is duly given to another party upon: (a) hand
delivery to the other party, (b) receipt by the other party when
sent by facsimile to the address and number for such party set
forth below (provided, however, that the Notice is not effective
unless a duplicate copy of the facsimile Notice is promptly given
by one of the other methods permitted under this paragraph), (c)
three business days after the Notice has been deposited with the
United States postal service as first class certified mail,
return receipt requested, postage prepaid, and addressed to the
party as set forth below, or (d) the next business day after the
Notice has been deposited with a reputable overnight delivery
service, postage prepaid, addressed to the party as set forth
below with next-business-day delivery guaranteed, provided that
the sending party receives a confirmation of delivery from the
delivery-service-provider.
To Pledgee: BOATRACS, INC.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇-▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
With Copy to: ▇▇▇▇▇▇▇ ▇▇▇▇ Seidenwurm & ▇▇▇▇▇
▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
To Pledgor: OCEANTRAC SYSTEMS LIMITED
▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Each party shall make a reasonable, good faith effort to ensure
that it will accept or receive Notices to it that are given in
accordance with this paragraph. A party may change its address
for purposes of this paragraph by giving the other party(ies)
written notice of a new address in the manner set forth above.
25. Waiver. Any waiver of a default or provision under this
Agreement must be in writing. No such waiver constitutes a
waiver of any other default or provision concerning the same or
any other provision of this Agreement. No delay or omission by a
party in the exercise of any of its rights or remedies
constitutes a waiver of (or otherwise impairs) such right or
remedy. A consent to or approval of an act does not waive or
render unnecessary the consent to or approval of any other or
subsequent act.
26. Drafting Ambiguities. Each party to this Agreement and its
legal counsel have reviewed and revised this Agreement. The rule
of construction that ambiguities are to be resolved against the
drafting party or in favor of the party receiving a particular
benefit under an agreement may not be employed in the
interpretation of this Agreement or any amendment to this
Agreement.
27. Third Party Beneficiaries. Nothing in this Agreement is
intended to confer any rights or remedies on any person or entity
other than the parties to this Agreement and their respective
successors-in-interest and permitted assignees, unless such
rights are expressly granted in this Agreement to another person
specifically identified as a "Third Party Beneficiary."
28. Arbitration. Any dispute, controversy or claim arising out
of or related to this Agreement shall be finally settled by
arbitration in accordance with the Rules of Conciliation and
Arbitration of the International Chamber of Commerce.
28.1. In the event of any conflict between these Rules and
this paragraph, the provisions of this paragraph shall govern.
The arbitration shall take place in San Diego, California. Each
of the parties shall appoint one arbitrator and the two so
nominated shall in turn choose a third arbitrator. If the
arbitrators chosen by the parties cannot agree on the choice of
the third arbitrator within a period of thirty (30) days after
their nomination, then the third arbitrator shall be appointed by
the Court of Arbitration of the International Chamber of
Commerce.
28.2. The arbitration shall be conducted in the English
language. Relevant documents in other languages shall be
translated into English if the arbitrators so direct. In
arriving at their award, the arbitrators shall make every effort
to find a solution to the dispute in the provisions of the
Agreement and shall give full effect to all parts thereof.
However, if a solution cannot be found in the provisions of the
Agreement, the arbitrators shall apply the local, domestic law of
the State of California, U.S.A., including its provision of the
Uniform Commercial Code.
28.3 The parties agree that after either has filed a Notice
of Demand for arbitration of any dispute subject to arbitration
under this Agreement, they shall, upon request, make discovery
and disclosure of all materials relevant to the subject of the
dispute. The arbitrators shall make the final determination as
to any discovery disputes between the parties. Examination of
witnesses by the parties and by the arbitrators shall be
permitted. A written transcript of the hearing shall be made and
furnished to the parties. The cost of this transcript shall be
borne equally by the parties.
28.4. The arbitrators shall state the reasons upon which
the award is based. The award of the arbitrators shall be final
and binding upon the parties. Judgment upon the award may be
entered in any court having jurisdiction. An application may be
made to any such court for a judicial acceptance of the award and
an order for enforcement.
29. Survival. The covenants, conditions, representations and
warranties of this Agreement shall survive the execution of this
Agreement.
BOATRACS, INC., a California corporation
By:____________________________________
____________________, _____________
OCEANTRAC SYSTEMS LIMITED, a Nova Scotia corporation
By:____________________________________
____________________, _____________
I ACCEPT THE OBLIGATIONS IMPOSED UPON
ME UNDER THIS PLEDGE AGREEMENT:
_________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., Pledgeholder
EXHIBIT E
SECURED PROMISSORY NOTE
Original Principal Amount $20,000.00 U.S. Date:
December 20, 1995
FOR VALUE RECEIVED, OCEANTRAC SYSTEMS LIMITED., a Nova
Scotia corporation, ("Maker") promises to pay to BOATRACS, INC.,
a California corporation, or order ("Holder"), at San Diego,
California (or such other address designated by Holder from time
to time), the sum of Twenty Thousand U.S. Dollars ($20,000.00
U.S.), plus any additional advances or loans made by Holder to
Maker, in Holder's sole and absolute discretion, plus interest
thereon, from the date hereof until all amounts due hereunder are
paid in full, at the rate of nine percent (9%) per annum, payable
as more fully set forth below.
1. Due on Demand. All unpaid principal and accrued
interest under this Note shall be immediately due and payable
seven days after written demand from Holder to Maker.
2. Manner of Payments. All payments by Maker under this
Note shall be (i) made in lawful money of the United States of
America without set-off, deduction or counterclaim of any kind
whatsoever (ii) credited first to amounts for late charges, if
any, second to amounts for Holder's costs of enforcing this Note,
if any, third to amounts of interest due (including default
interest) hereunder, if any, and finally to the principal balance
under this Note, and (iii) deemed paid by Maker upon their actual
receipt by Holder.
3. Prepayment. Maker has the right to prepay the principal
amount of this Note at any time without penalty.
4. Late Charge. If any amount of interest and/or principal
under this Note is not received by Holder upon the due date then,
without any requirement for notice to Maker, Maker shall immedi
ately pay to Holder an additional sum of five percent (5%) of
such overdue amount as a late charge. Such late charge is fair
and reasonable based upon the facts and circumstances existing as
of the date of this Note. Acceptance of such late charge by
Holder shall not constitute a waiver of Maker's default with
respect to such overdue amount, nor prevent Holder from
exercising any of the other rights and remedies available to
Holder under this Note.
5. Acceleration. All unpaid principal and accrued and
unpaid interest under this Note shall, at Holder's election, be
immediately due and payable upon the occurrence of any failure by
Maker to timely satisfy all of its obligations under this Note,
any other Note or Agreement made by Maker (including, without
limitation, under the Agreement entered into among OCEANTRAC
SYSTEMS LIMITED and Holder, evenly dated herewith and all
Exhibits thereto.
6. Security. This Note is secured by a Pledge evenly dated
with this Note from Maker to Holder and naming ▇▇▇▇▇▇▇ ▇▇▇▇
Seidenwurm & ▇▇▇▇▇ as Pledge Holder.
7. Commercial Purposes. Maker acknowledges that the loan
evidenced by this Note is obtained for business or commercial
purposes and that the proceeds of such loan will not be used
primarily for personal, family, household or agricultural
purposes.
8. Interest Limitation. It is not intended by any
provision of this Note to charge interest at a rate in excess of
the maximum rate of interest permitted to be charged to Maker
under applicable law on a cumulative basis over the life of the
loan evidenced by this Note (the "Loan"). If by mistake or
error, interest in excess of such maximum rate shall be paid for
any period during the term of the Loan, the excess amount shall,
if permitted by applicable law, be retained by Holder as
additional cash collateral for the Loan to be held without
interest or trust and commingled with other assets of Holder or,
if not permitted to be so held by Holder, shall be refunded to
Maker. If for any period during the term of the Loan, Holder is
unable, because of a limitation on the rate of interest permitted
to be charged to Maker under applicable law, to collect all of
the interest and premium provided for in this Note, such interest
or premium ("interest shortage") shall, if permitted by
applicable law, be added to the interest earned or to be earned
for prior or subsequent periods during the term of the Loan so
that, to the extent permitted by applicable law on a cumulative
basis over the life of the Loan, Holder may collect all of the
interest and premium provided for in this Note, the same to be
accomplished in the following manner, or otherwise as permitted
by applicable law: (i) if Holder were permitted by applicable
law to charge interest to Maker in such prior periods in excess
of the amount of interest and premium actually charged during
such prior periods, then the interest due on the Loan for such
prior periods shall automatically be increased by the amount of
such interest shortage, but not in excess of the maximum interest
permitted to be charged to Maker during such prior periods, and
such increased interest for such prior periods shall be
immediately due and payable upon demand; and (ii) if Holder shall
have collected all interest permitted by applicable law to be
charged to Maker in such prior periods, and if Holder is
thereafter permitted by applicable law to charge interest to
Maker in such subsequent periods in excess of the amount of
interest and premium actually charged during such subsequent
periods, the interest due on the Loan for such subsequent periods
shall automatically be increased by the amount of such interest
shortage, but not in excess of the maximum interest permitted to
be charged to Maker during such subsequent period, and such
increased interest for such subsequent periods shall be due and
payable at the end of each such subsequent period upon demand.
9. Note Waivers. Maker waives presentment, notice,
demand, protest, notice of demand and dishonor.
10. Governing Law. This Note shall be governed by and
construed in accordance with the laws of the State of California.
11. Further Assurances. Each party to this Note shall
execute all instruments and documents and take all actions as may
be reasonably required to effectuate this Note.
12. Venue and Jurisdiction. All actions and proceedings
arising in connection with this Note must be tried and litigated
exclusively in the State and Federal courts located in the County
of San Diego, State of California, which courts have personal
jurisdiction and venue over each of the parties to this Note for
the purpose of adjudicating all matters arising out of or related
to this Note. Each party authorizes and accepts service of
process sufficient for personal jurisdiction in any action
against it as contemplated by this paragraph by registered or
certified mail, return receipt requested, postage prepaid, to its
address for the giving of notices set forth in this Note.
13. Time of Essence. Time and strict and punctual
performance are of the essence with respect to each provision of
this Note.
14. Attorney's Fees. In the event any litigation,
arbitration, mediation, or other proceeding ("Proceeding") is
initiated by any party against any other party to enforce,
interpret, collect upon, foreclose, or otherwise obtain judicial
or quasi-judicial relief in connection with this Note, the
prevailing party in such Proceeding shall be entitled to recover
from the unsuccessful party all costs, expenses, and actual
attorney's fees relating to or arising out of (i) such Proceeding
(whether or not such Proceeding proceeds to judgment), and (ii)
any post-judgment or post-award proceeding including without
limitation one to enforce any judgment or award resulting from
any such Proceeding. Any such judgment or award shall contain a
specific provision for the recovery of all such subsequently
incurred costs, expenses, and actual attorney's fees.
15. Modification. This Note may be modified only by a
contract in writing executed by the party to this Note against
whom enforcement of such modification is sought.
16. Headings. The headings of the Paragraphs of this Note
have been included only for convenience, and shall not be deemed
in any manner to modify or limit any of the provisions of this
Note, or be used in any manner in the interpretation of this
Note.
17. Waiver. Any waiver of a default under this Note must
be in writing and shall not be a waiver of any other default
concerning the same or any other provision of this Note. No
delay or omission in the exercise of any right or remedy shall
impair such right or remedy or be construed as a waiver. A
consent to or approval of any act shall not be deemed to waive or
render unnecessary consent to or approval of any other or
subsequent act.
18. Drafting Ambiguities. Maker and his legal counsel have
reviewed and had an opportunity to negotiate the terms of this
Note. The rule of construction that any ambiguities are to be
resolved against the drafting party shall not be employed in the
interpretation of this Note.
19. Notices. All notices of other communications required
or permitted to be given to a party to this Note shall be in
writing and shall be personally delivered, sent by certified
mail, postage paid, return receipt requested, or sent by an
overnight express courier service that provides written
confirmation of delivery, to such party at the following
respective address:
Holder: BOATRACS, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇-▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
OCEANTRAC Systems Limited
▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Each such notice or other communication shall be deemed given,
delivered and received upon its actual receipt, except that if it
is sent by mail in accordance with this paragraph, then it shall
be given, delivered and received three days after the date such
notice or other communication is deposited with the United States
Postal Service in accordance with this Paragraph. Any party to
this Note may give notice of a change of its address to the other
party(ies) to this Note.
OCEANTRAC SYSTEMS LIMITED, a Canadian
corporation, Maker
By: ______________________________
Its: ______________________________
By: ______________________________
Its: ______________________________
OCEANTRAC INCORPORATED, a Canadian
corporation, Maker
By: ______________________________
Its: ______________________________
By: ______________________________
Its: ______________________________