I have related relevant experience in this area as I am the first American to be invited to have an Entrepreneur's Visa in Canada, and I am also an Attorney from Boston, MA.
My experience in Canada has shown me that for Americans, it is very much similar to the United States, and as we are State-based in our choice of laws conflict provisions within the contract, Canada is Province- based. So first, understand what Province in Canada this company is from.
Otherwise, the terms and conditions of the contractual negotiations are very similar to the U.S., so your relevant knowledge of your product, its margins, the anticipated percentages of net and gross margins and whether the respective market can withstand and or absorb that pricing, whether the distributor takes title or receives a commission while you retain tile, etc., are all normal, fundamental contractual terms and conditions which must be addressed and agreed upon before any product can be shipped.
This, of course, implicates Canadian Customs, therefore is is important to know your NAFTA and or NAICS code of your product to understand the nature of the duty, if any - this is more of the Canadian's issue, but its good business practice for you to know, as this may impact the final selling price which the Canadian company has to sell at, and you want them to be successful, of course.
Further, as you are in the prototype stage, you should have a solid NDA (Non-Disclosure Agreement) signed by the Canada company before divulging any information to them, other than the most basic and rudimentary. To craft the terms of that agreement effectively, you need to know what your information and intellectual property is comprised of, so you understand what it is that you are actually protecting (patents, trademarks, service marks, copyright, know-how, or trade secret).
This was merely a quick outline, as I see it, regarding your question. Should you desire a more in depth explanation, please reach out to me on my mobile at 617-283-6995, I am based in Boston, MA and travel regularly. You may text first to establish a suitable time for us both to chat, should you so desire. Thank you for posting your question, and allowing me to answer. My Best, Joseph J. Shamon, Jr. - 617-283-6995,