Joint Venture Agreement - AquaCell Technologies Inc. and Corbett Water Technologies Inc.
JOINT VENTURE AGREEMENT
-----------------------
AGREEMENT made this 9th day of October, 2001, between
AQUACELL TECHNOLOGIES, INC. ("AquaCell"), a Delaware
corporation CORBETT WATER TECHNOLOGIES, INC., ("CORBETT
WATER"), a Nevada corporation
WHEREAS, AquaCell and Corbett Water, an 85% S&B
TECHNICAL subsidiary, are currently parties to a
Distribution Agreement dated October 9, 2001, covering
domestic marketing rights to certain of AquaCell's products,
and
WHEREAS, the parties wish to form a new corporation
covering foreign marketing, distribution and manufacturing
rights to those products under the name of S&B INTERNATIONAL
WATER TECHNOLOGIES, INC. ("S&B WATER")
NOW THEREFORE, it is agreed:
I. FORMATION OF S&B WATER
-------------------------
1. The parties agree to form a new corporation, S&B WATER,
which initially be owned 55% by S&B TECHNICAL, represented
by an issuance of 27,500 shares of S&B WATER common stock;
and 45% AquaCell, represented by an issuance of 22,500
shares of S&B Water common stock;
2. The parties agree that S&B WATER shall immediately open
a checking account at a commercial bank wherein the working
capital of the corporation shall be maintained. CORBETT
WATER will advance $100,000 to S&B WATER to be paid to
AquaCell for the rights conferred hereunder upon execution
of this Agreement;
3. Except as specifically set forth herein the receivables
and other assets of each party and the payables and
liabilities of each party are not part of or subject to this
Agreement.
II. OPERATION OF S&B WATER
--------------------------
1. Bradford G. Corbett, Jr., shall be named President and
Chief Executive Officer of S&B WATER and will have
operational control over the functioning of S&B WATER
including sole check signing authority;
2. The number of Directors of S&B WATER shall be four,
consisting of two Directors appointed by each party hereto;
3. S&B WATER shall be assigned exclusive marketing,
distribution, and manufacturing rights for all Global Water-
AquaCell products in foreign jurisdictions (i.e. those not
covered by the Distribution Agreement between Corbett Water
and AquaCell) together with rights of first refusal on any
and all products obtained by AquaCell from future
acquisitions.
4. S&B WATER will be issued 50% of the stock of AquaCell
Media International, Inc., with the balance of the stock
owned by AquaCell Media, Inc.
1
JCW:__________
BGC:__________
<PAGE>
5. AquaCell and CORBETT WATER will split the profits of
S&B WATER in proportion to their stock interest.
6. CORBETT WATER will advance working capital, as it deems
necessary, for the operation of S&B WATER.
7. AquaCell will provide certain manufacturing equipment,
as it deems necessary, to S&B WATER.
III. BOOKS
----------
1. Books of account for the performance of S&B WATER shall
be kept and maintained at the corporate offices of S&B
WATER. All books and records shall be open for inspection
by any party at any time.
IV. LIMITS OF RELATIONSHIP
--------------------------
1. The relationship between the parties shall be limited
to the performance of the obligations specifically
undertaken herein. Nothing herein shall be construed to
authorize either party to act as a general agent for the
other party, or to permit either party to bid for or
undertake any contracts for the other party.
V. TERM AND TERMINATION
-----------------------
1. This Agreement shall remain in effect for a period of
five (5) years from the date hereof and thereafter shall be
extended automatically on a year-to-year basis subject to
the termination rights set forth herein. This Agreement is
terminable at will by either party at the end of the initial
five (5) year term, or at the end of any renewal term
provided for herein, by giving written notice of termination
to the other party at least ninety (90) days prior to the
termination date of the Agreement or the termination of the
then current renewal term.
2. Upon termination of this Agreement in any manner all
manufacturing rights conferred hereunder shall revert back
to AquaCell, all manufacturing shall immediately cease, and
all equipment provided by AquaCell pursuant to paragraph
II(7) above shall be returned to AquaCell, unless agreed
other wise by AquaCell.
VI. NO ASSIGNMENT
-----------------
Neither this Agreement nor any interest herein may be
assigned, pledged, transferred or hypothecated, without the
prior written consent of the parties hereto.
VII. NONCOMPETITION; CONFIDENTIAL INFORMATION
---------------------------------------------
For so long as this Agreement shall be in effect and for a
period for two (2) years thereafter:
1. S&B TECHNICAL, CORBETT WATER and S&B WATER
(collectively "S&B") shall not, directly or indirectly, be
involved as owner, partner, shareholder, joint venturer,
director, employee, or otherwise, in the conduct of any
business that competes with AquaCell in the territory as
defined in paragraph II.3 above.
2
JCW:__________
BGC:__________
<PAGE>
2. S&B shall not solicit business from any of AquaCell's
customers, except on behalf of and for the benefit of
AquaCell, nor shall S&B solicit any of AquaCcll's
employees or sales representatives for the purpose of
being employed by S&B or by any party in which S&B is
an owner or employee.
3. S&B acknowledges that certain information of AquaCell,
such as AquaCell's sales manuals, price lists, customer
lists and similar materials, are AquaCell's trade secrets
and shall be and remain AquaCell's sole and exclusive
property. S&B shall not disclose any such information to
others and shall not use such confidential information in
any way except in furtherance of its services on
AquaCell's behalf.
4. S&B acknowledges that in the event of its breach, or
threatened breach of any of the provisions of this
paragraph, AquaCell's remedy at law would be inadequate,
and that damages flowing from such breach would not
readily be susceptible of being measured in monetary
terms. Accordingly, upon S&B's violation or threatened
violation of any of the foregoing provisions, AquaCell
shall be entitled to immediate injunctive relief and may
obtain a temporary re5training order in court restraining
any threatened or further breach, notwithstanding the
provisions of paragraph 8 regarding arbitration.
VIII. ARBITRATION
-----------------
All disputes between AquaCell and CORBETT WATER arising
from this Agreement shall be submitted by the parties to
arbitration under the auspices of the American Arbitration
Association in accordance with its rules.
IX. NOTICES
-----------
All notices or other communications required or permitted
hereunder shall be given in writing and shall be delivered
or sent by certified mail, postage prepaid, or by facsimile
transmission confirmed by first class mail, as follows:
If to CORBETT WATER:
--------------------
Brad Corbett, Jr.
CORBETT WATER TECHNOLOGIES, Inc.
1300 East Berry Street
Fort Worth, TX 76119
With a copy to:
John Brookman, Esq.
Brookman Law Firm
1300 East Berry Street, 4th Floor
Fort Worth, TX 76119
3
JCW:__________
BGC:__________
<PAGE>
If to AQUACELL:
---------------
James C. Witham
AquaCell Technologies
10410 Trademark Street
Rancho Cucamonga, CA 91730
With a copy to:
Harold W. Paul, Esq.
Paul & Rosen, LLP
420 Lexington Avenue
New York, New York 10017
or such other address as shall be furnished in writing by
such party.
X. GOVERNING LAW
----------------
This Agreement shall be governed by the laws of the
State of Delaware.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed as of the date first above written.
AQUACELL TECHNOLOGIES, INC
/s/ James C. Witham
By__________________________________________
James C. Witham, CEO
CORBETT WATER TECHNOLOGIES, INC.
/s/ Bradford G. Corbett, Jr.
By__________________________________________
Bradford G. Corbett, Jr., President
4
JCW:__________
BGC:__________