COMMERCIAL SUPPLY AGREEMENT
THIS
COMMERCIAL SUPPLY AGREEMENT (this “Agreement”) is entered into effective
as of April 5, 2007 (the “Effective Date”), by and between Chi Mei EL
Corporation (“CMEL”), an entity incorporated under the laws of the Taiwan
and having a place of business at Xx. 0, Xxx Xxx Xxxx, Xxxxxx Science-Based
Industrial Park 74147, Taiwan , and Universal Display Corporation (“Universal
Display”), an entity incorporated under the laws of the Commonwealth of
Pennsylvania, U.S.A. and having a place of business at 000 Xxxxxxxx Xxxxxxxxx,
Xxxxx, Xxx Xxxxxx 00000, X.X.X.
BACKGROUND
WHEREAS,
Universal Display makes and desires to sell certain materials for use in organic
light emitting devices to CMEL; and
WHEREAS,
CMEL desires to purchase these materials from Universal Display on the terms
and
conditions set forth herein.
NOW,
THEREFORE, intending to be legally bound, CMEL and Universal Display agree
as
follows:
AGREEMENT
Article
1 Terms
of Sale; Orders and Forecasts
1.1 General. Universal
Display will sell to CMEL, and CMEL will purchase from Universal Display, such
of the OLED materials currently offered for commercial sale by Universal Display
and specified on Exhibit A hereto (the “Products”) as CMEL may
order from time to time hereunder. Exhibit A shall be updated
by the parties from time to time as CMEL desires other OLED materials that
Universal Display is offering for commercial sale, or as Universal Display
ceases offering to sell certain of the OLED materials currently being sold
to
CMEL hereunder. Universal Display shall provide CMEL with at least
six (6) months’ prior written notice of its intention to discontinue offering
for commercial sale any OLED material currently being sold to CMEL (“End of
Production”) hereunder. Upon receiving the notice from Universal Display, CMEL
may provide a last time buy order (“LTB”) to Universal Display, of which
Universal Display shall use reasonable efforts to fulfill the ordered quantity
on the LTB.
1.2 No
Additional Terms. Unless otherwise expressly agreed to in writing, Universal
Display’s sale and CMEL’s purchase of all Products hereunder shall be solely on
the terms and conditions set forth herein. Each party accepts these
terms and conditions and no inconsistent or additional terms or conditions
of
any purchase order, acceptance, shipping instructions or other document
submitted by either party shall apply other than those specified
herein. All such other terms and conditions are hereby rejected and
no separate notice of such rejection need be given by either party.
1.3 Purchase
Orders. CMEL shall place written orders with Universal Display
for the Products (“Orders”) at least three (3) months in advance of the
requested shipment date. All Orders shall include (a) the date of the
Order, (b) the identity and quantity of each Product ordered, (c) the requested
date of shipment, and (d) the shipping destination. Promptly
following the Effective Date, the parties shall agree upon CMEL’s Order for the
three (3) month period immediately thereafter.
1.4 Forecasts. CMEL
shall provide Universal Display, in writing, with rolling forecasts, on a
calendar quarterly basis by the end of each quarter, of its expected
requirements for each Product during the next twelve (12)
months. These forecasts shall be non-binding, however, Universal
Display shall use commercially reasonable efforts to fill that portion of any
Order for a Product which exceeds CMEL’s twelve (12) month advance forecasted
requirement for such Product.
1.5 Title
and Risk of Loss. All Products shall be sold [The confidential
material contained herein has been omitted and has been separately filed with
the Commission.], Universal Display’s facility in Ewing, New Jersey,
U.S.A. CMEL shall be, subject to the aforementioned delivery term,
responsible for all associated shipping and insurance charges, brokers’ fees and
the like, all of which, if arranged by Universal Display on CMEL’s behalf, shall
be separately stated on Universal Display’s invoices.
1.6 Shipping
Dates. Universal Display shall ship ordered Product on CMEL’s
requested date of shipment without any unnecessary delay. Partial
deliveries shall not be allowed unless CMEL gives Universal Display a prior
written consent for partial delivery, which consent shall not be unreasonably
withheld.
1.7 [The
confidential material contained herein has been omitted and has been separately
filed with the Commission.]
Article
2 Inspection
and Acceptance
2.1 Qualification
Testing by Universal Display. Universal Display will conduct
qualification testing of each production lot of Product before shipping any
Product from such lot to CMEL. Such qualification testing shall be
designed to ensure that the Product conforms to its corresponding specifications
agreed to by the parties in writing (the “Product Specifications”) and
attached under this Agreement as Exhibit B. Universal Display will
not ship Product to CMEL from any lot that does not meet the Product
Specifications. With each Product shipment, Universal Display will
submit to CMEL a Certificate of Analysis indicating that such lot conforms
to
the applicable Product Specifications.
2.2 Acceptance
Testing of Samples by CMEL.
2.2.1 Universal
Display will provide CMEL with a [The confidential material contained herein
has
been omitted and has been separately filed with the Commission.] test sample
from the production lot(s) from which the Product will be supplied; however,
no
sample shall be sent from production lot(s) for which CMEL has already received
a test sample. This test sample shall be sent to CMEL as far in
advance of the requested shipping date as is reasonably practicable, up to
one
(1) month in advance.
2.2.2 Within
two (2) weeks following its receipt of a test sample as specified above, CMEL
will conduct an acceptance test to confirm that the sample conforms to its
corresponding Product Specifications. At the conclusion of such two
(2) week period, CMEL will inform Universal Display in writing as to whether
or
not the test sample passed this acceptance test. Unless otherwise
expressly agreed to by the parties, Universal Display shall fill all Orders
using only Product from production lots for which CMEL has informed Universal
Display in writing that the test sample from such production lots has passed
CMEL’s acceptance test, such written notice not to be unreasonably withheld or
delayed. CMEL understands and acknowledges that any delay in so
informing Universal Display may result in a corresponding delay in the shipping
date, since shipments may not be initiated until up to one (1) week after
Universal Display receives CMEL’s written notice of acceptance.
2.2.3 If
the
test sample does not pass CMEL’s acceptance test, the parties shall promptly and
in good faith discuss and attempt to determine why this has occurred and
Universal Display and CMEL shall implement procedures to prevent its
recurrence. At the same time, Universal Display will in good faith
endeavor to fill the Order in a timely manner by shipping to CMEL Product from
one or more production lots for which the test samples have already passed
CMEL’s acceptance test. Should there be insufficient material from
such production lots for Universal Display to fill the Order, Universal Display
will promptly provide CMEL with a test sample from one or more other production
lots for which no test samples have previously been sent and the process above
shall be repeated until sufficient material to fill the Order has been
identified. Should this prevent Universal Display from filling the
Order by the requested shipping date or within a reasonable period of time
thereafter (said period not to exceed thirty five (35) days), CMEL shall have
the right to cancel the Order and in addition to any other rights or remedies
as
may be available to CMEL, subject to the express provisions and limitations
of
this Agreement.
2.3 Shipping
Inspection by Universal Display. Universal Display will conduct a
final visual inspection of all Product that have passed Universal
Display’s qualification test under this Agreement before shipping such Product
to CMEL. Universal Display will not ship to CMEL any Product that
does not pass such visual inspection.
2.4 Receiving
Inspection by CMEL. Upon receipt of each Product shipment, CMEL
will visually inspect such shipment for any shortage or other visible
defects. CMEL will provide Universal Display with written notice of
any shortage or visible defects promptly following CMEL’s receipt of the
shipment, which notice shall specify in reasonable detail the manner in which
the shipment is short or defective. In the absence of Universal
Display receiving written notification to the contrary within thirty (30) days
following CMEL’s receipt of the shipment, CMEL shall be deemed to have accepted
the shipment on the date of receipt. In addition to any other rights
or remedies as may be available to CMEL, but subject to the express provisions
and limitations of this Agreement, CMEL’s remedy and Universal Display’s
responsibility with respect to any Product shipment that is identified by CMEL
to be short or otherwise defective shall be promptly making up the shortage
or
replacing the defective Product by Universal Display, all at no additional
cost
to CMEL except where the shortage or defect arises through no fault of Universal
Display after risk of loss for the Product shipment has passed to
CMEL. In the event is determined to have arisen after risk of loss
has passed to CMEL, Universal Display will use commercially reasonable efforts
to assist CMEL in making any claims against the carrier with respect
thereto.
2.5 Other
Procedures. The parties may agree on more detailed inspection,
certification and testing procedures in order to supplement the foregoing
provisions of this Article 2. All such procedures must be documented
and signed by an authorized representative of each party before they shall
become binding on them.
Article
3 Health
and the Environment
3.1 Health
and Safety. Universal Display will furnish CMEL with a Material
Safety Data Sheet (an “MSDS”) for each Product where required by
applicable law. CMEL shall use these MSDS’s to familiarize itself
with any known hazards associated with the Products, their storage, handling
and
use, and the containers in which they are shipped. CMEL shall
appropriately inform and train its employees and other personnel, with the
assistance of the Universal Display MSDS, as to the hazards identified in
the MSDS for each Product and any other hazards discovered by CMEL through
its
use of such Product.
3.2 Waste
Management. Subject to CMEL’s receipt of the
aforementioned MSDS in Article 3.1 above and Universal Display’s prompt and
reasonable assistance, CMEL shall properly manage and dispose of all wastes
and/or residues resulting from its use of the Products in accordance with its
corresponding MSDS and the applicable laws and regulations.
Article
4 Intellectual
Property Matters
4.1 Permitted
Uses of the Products. CMEL acknowledges that Universal Display is
selling the Products to CMEL solely for use by CMEL to manufacture,[The
confidential material contained herein has been omitted and has been separately
filed with the Commission.] sell, offer for sale and/or import and/or otherwise
dispose of active matrix flat panel OLED display modules [The confidential
material contained herein has been omitted and has been separately filed with
the Commission.] on rigid glass substrates, made by vacuum thermal evaporation
processes (“Permitted Displays”). Accordingly, CMEL may not
sell or otherwise distribute the Products to any other person or entity [The
confidential material contained herein has been omitted and has been separately
filed with the Commission.], or use the Products, or permit or assist others
to
use the Products, for any other purposes. Subject to the foregoing,
no other rights are granted to CMEL under any patents or other intellectual
property owned or controlled by Universal Display. For clarification,
CMEL is not licensed under any of Universal Display’s other OLED patents, except
those phosphorescence patents implied for the use of the Products purchased
hereunder to make, have made, import, sell, offer for sale and/or otherwise
dispose of the Permitted Displays. Moreover, CMEL is not licensed
under any of Universal Displays patents to make or sell Permitted Displays
incorporating third-party phosphorescent emitters.CMEL acknowledges that the
pricing charged by Universal Display for Products sold under this Agreement
is
based on CMEL’s agreement to use such Products only for the purposes stated
under this Agreement , and that such pricing would not otherwise have been
offered to CMEL.
4.2 Third-Party
Patents. CMEL acknowledges that it may be required to obtain
rights under one or more third-party patents in order to make and sell Permitted
Displays, or to use chemicals other than the Products in such displays, and
that
CMEL shall be responsible for securing such rights. CMEL may request
reasonable assistance from Universal Display in ascertaining and evaluating
the
necessary rights to the same.
4.3 Analysis
and Evaluation of the Products. CMEL shall not manufacture or
reverse engineer the Products, or analyze the Products to determine their
chemical compositions, structures or methods of manufacture, or for any other
purposes not expressly approved in writing by Universal Display, nor shall
CMEL
permit or assist others to perform the foregoing activities. In
addition, CMEL shall not publish or otherwise disclose to third parties any
test
results or other information or data regarding CMEL’s evaluation of the Products
without Universal Display’s prior written consent. The foregoing
shall not restrict CMEL from conducting its relevant standard performance
testing of Permitted Displays.
4.4 Technical
Advice. CMEL is responsible for making its own inquiry and
investigation into, and based thereon forming an independent judgment
concerning, the Products and their suitability for the uses intended by
CMEL. Except Universal Display’s representations and/or warranties
expressly made under this Agreement, CMEL shall not assert any claim against
Universal Display or hold Universal Display liable with respect to any information or designs
furnished (or failed to be furnished) by Universal Display including, without
limitation, technical advice or recommendations. Statements made by
Universal Display concerning possible or suggested uses of the Products are
not
to be construed as recommendations for uses of such Products that would infringe
the patent or other intellectual property rights of third parties, and Universal
Display assumes no liability or responsibility for any such
infringement.
4.5 Export
Control. Each party shall comply with all obligations under
applicable law to control access to technical data under the U.S. Export Laws
and Regulations, or any Taiwanese counterparts thereof, and shall adhere to
such
laws and regulations in handling and disclosing any technical information
provided or received by it under this Agreement in relation to any
Product.
Article
5 Pricing
and Payments
5.1 Product
Pricing. Pricing for the Products during the term of this
Agreement shall initially be as set forth on in Exhibit A
hereto. Universal Display and CMEL shall in good faith review and
discuss such pricing for the next six (6) months, based on CMEL’s volume of
purchases and usage[The confidential material contained herein has been omitted
and has been separately filed with the Commission.]. Any price change
will not be effective unless confirmed by both parties in
writing. Orders issued prior to any confirmed price change shall
remain at the original price unless agreed in writing by the
parties.
5.2 Invoicing. Universal
Display shall invoice CMEL for all Products at the time of
shipment. All invoices are due and payable within [The confidential
material contained herein has been omitted and has been separately filed with
the Commission.] following the date of CMEL’s receipt of the Product shipment in
accordance with Article 2 under this Agreement. If CMEL fails or
refuses to timely pay any amounts not then being disputed by CMEL in good faith,
Universal Display may, after sending a written notice to CMEL, (a) require
that
CMEL pay for future shipments in advance or by letter of credit or other similar
means, and/or (b) suspend delivery of further shipments of Products until CMEL
pays such undisputed amounts in full. The foregoing shall not be the
sole remedies available to Universal Display for non-payment or late payment
of
amounts due hereunder.
5.3 Sales
and Other Similar Taxes. Any sales, use or value-added taxes,
customs or import duties or other governmental charges, transfer fees or
assessments based on the sale, shipment, import, export and/or use of the
Products sold hereunder (other than taxes based upon Universal Display’s net
income), whether imposed by any local, state, Federal or foreign government
or
taxing authority [The confidential material contained herein has been omitted
and has been separately filed with the Commission.]. To the extent
Universal Display is responsible by law for the collection of such amounts,
they
shall be separately stated on Universal Display’s invoices for such Products
and, upon collection, remitted by Universal Display to the appropriate taxing
authority.
5.4 Payments. All
amounts due to Universal Display hereunder shall be paid in U.S. Dollars by
wire
transfer to a bank designated by Universal Display in writing, or by such other
means as the parties may agree in writing. Universal Display’s
current wire instructions are as follows:
[The
confidential material contained herein has been omitted and has been separately
filed with the Commission.]
Each
payment shall be fully earned when due and is nonrefundable. All
payments due hereunder shall be made without set-off, deduction or credit for
any amount owed (or alleged to be owed) by Universal Display to CMEL or any
of
its affiliates. Subject to the aforementioned exception and without
limiting other rights or remedies, Universal Display may require CMEL to pay
interest on any amounts not paid when due at a per annum rate equal to the
Prime
Rate as published in The Wall Street Journal on the date of payment,
plus [The confidential material contained herein has been omitted and has been
separately filed with the Commission.].
5.5 Payment
Authorization and Withholding Taxes. CMEL shall secure all
authorizations required for payment of all amounts due to Universal Display
hereunder and shall bear all transfer fees, taxes and other charges associated
therewith. If necessary and applicable, the parties shall in good
faith endeavor to file for and obtain an exemption from the withholding of
any
taxes on amounts payable to Universal Display hereunder.
Article
6 Confidentiality
6.1 Obligations
of Confidentiality and Non-Use. Each party (the
“Recipient”) shall handle and maintain all Confidential Information of
the other party in accordance with the following terms and
conditions:
6.1.1 Recipient
shall not publish, disclose or otherwise disseminate any Confidential
Information of the other party, except to such of Recipient’s employees and
agents who have a “need to know” it to accomplish the purposes of this
Agreement, and then only if such persons previously have agreed in writing
to
handle and maintain such Confidential Information in accordance with the
provisions of this Agreement or provisions substantially similar
thereto. Recipient shall have the right to disclose Confidential
Items of the other party to the Recipient’s Affiliates who “need to know” it to
accomplish the purposes of this Agreement, provided they agree to be bound
by
confidentiality obligations no less restrictive than the confidentiality
obligations set forth in Article 6. An “Affiliate” means any Taiwanese
person, partnership, corporation or other entity, including but not limited
to
subsidiaries, that directly or indirectly, control, are controlled by, or are
under common control with a party. Disclosure or dissemination of
Confidential Information of the other party to additional persons or entities
requires the prior written approval of such other party.
6.1.2 Recipient
shall maintain all Confidential Information of the other party in a safe and
secure place with reasonable safeguards to prevent any unauthorized access
to or
disclosure of such Confidential Information. As used herein,
“reasonable safeguards” means all safeguards that a reasonable person would take
to protect the Confidential Information in question, which safeguards shall
be
no less than the safeguards Recipient takes to protect its own confidential
or
proprietary items of a similar nature.
6.1.3 Recipient
shall not utilize, reproduce or otherwise exploit any Confidential Information
of the other party, or permit or assist others to utilize, reproduce or
otherwise exploit such Confidential Information, except as is reasonably
necessary to accomplish the purposes of this Agreement.
6.1.4 Promptly
upon learning of any unauthorized use or disclosure of any Confidential
Information of the other party, Recipient shall provide the other party with
written notice thereof and take such other steps as are reasonably requested
by
the other party in order to limit the effects of such use or disclosure and/or
prevent any further unauthorized use or disclosure of such Confidential
Information.
6.1.5 Promptly
upon the expiration or sooner termination of this Agreement, Recipient shall
return to the other party, destroy and/or delete from Recipient’s records and
computer systems all Confidential Information of the other party, including
any
copies or portions thereof, in Recipient’s possession or control; provided,
however, that Recipient may retain one copy of documents incorporating
Confidential Information for archival purposes only. Within thirty
(30) days following the other party’s written request, Recipient shall provide
the other party with a certificate of Recipient’s compliance with the foregoing
requirements.
6.2 Definition
of Confidential Information. As used herein, “Confidential
Information” of a party means all trade secret, proprietary and confidential
information, in written, oral or electronic form, relating to such party’s or
its licensors’ or suppliers’ technologies, materials, research programs,
operations and/or financial or business condition (including, without
limitation, know-how, data, drawings, designs, specifications, formulations,
processes, methods, equipment, software and pricing information) that is (a)
disclosed in writing and marked as “Confidential”, “Proprietary” or with similar
words at the time of disclosure; or (b) orally disclosed and identified as
confidential or proprietary at the time of disclosure and confirmed as such
in
writing within thirty (30) days thereafter. Notwithstanding the
foregoing, “Confidential Information” of a party shall not include any
information that:
6.2.1 is
approved by such party in writing for release by Recipient without
restriction;
6.2.2 Recipient
can demonstrate by written records was previously known to Recipient other
than
through a prior disclosure by such party or any third party with an obligation
of confidentiality to such party;
6.2.3 is
publicly known as of the date of this Agreement, or becomes public knowledge
subsequent thereto, through no act or omission of Recipient or any third party
receiving such information from or through Recipient;
6.2.4 is
obtained by Recipient in good faith from a third party without the violation
of
any obligation of confidentiality to such party by either Recipient or the
third
party; or
6.2.5 is
independently developed by or on behalf of Recipient without the benefit of
such
party’s Confidential Information, as shown by competent written
records.
6.3 Disclosure
Required by Law. This Agreement shall not restrict Recipient from
disclosing any Confidential Information of the other party to the extent
required by applicable law, or by the order of any court or government agency;
provided, however, that Recipient shall afford the other party prompt notice
of
such law or order, so that the other party may interpose an objection to such
disclosure or take whatever other actions the other party deems appropriate
to
protect such Confidential Information, and provided further that Recipient
shall
use all reasonable efforts to limit such disclosure to only that Confidential
Information which is required to be disclosed.
6.4 Responsibility
for Personnel. Recipient shall be responsible for the acts or
omissions of any persons or entities receiving Confidential Information of
the
other party from or through Recipient to the extent such acts or omissions,
if
performed or not performed by Recipient, would constitute violations of this
Agreement by Recipient.
6.5 Confidentiality
of this Agreement. The terms of this Agreement and its existence
shall be deemed Confidential Information of each party and treated as such
by
both parties. Notwithstanding the foregoing sentence, either party
may disclose in its public filings such of the terms of this Agreement as are
reasonably required for such party to comply with applicable securities laws
and
regulations, including, without limitation, by filing an appropriately redacted
copy of this Agreement in connection therewith. In addition, either
party may issue a press release or other public announcement describing the
general nature of this Agreement, or the parties may agree to issue such a
release or announcement jointly, it being understood that Universal Display
will
need to issue a press release within four (4) business days following the
Effective Date so as to coincide with its filing with the U.S. Securities and
Exchange Commission of a Current Report on Form 8-K. However, it is
expressly understood and agreed that no such release or public disclosure shall
disclose any information about CMEL’s expected or intended product launch
strategy, or whether any such products will utilize any Products sold to CMEL
hereunder, without CMEL’s prior written consent. Subject to the
foregoing provisions of this paragraph, any such public disclosure of the
specific financial terms or other provisions of this Agreement, or any other
information regarding the relationship between the parties hereunder, shall
require the other party’s prior written consent.
6.6 Period
of Confidentiality. Recipient agrees that, for a period of five (5)
years from the date of the termination or expiration of this Agreement (“Period
of Confidentiality”), and notwithstanding any termination or expiration hereof,
all terms set forth in Article 6 shall survive the termination or expiration
of
this Agreement until the Period of Confidentiality ends.
Article
7 Representations
and Warranties; Disclaimers and Limitations of Liability
7.1 Warranties
by Both Parties. Each party represents and warrants to the other
that such party has the right, power and authority to enter into this Agreement
and to perform its obligations hereunder, and that such performance will not
violate any other agreement or understanding by which such party is
bound.
7.2 Further
Product Warranty by Universal Display. Universal Display
additionally represents and warrants to CMEL that all Products will comply
with
the agreed Product Specifications for a period of six (6) months on and from
the
date of receipt by CMEL, with the understanding that CMEL shall exert the
commercially reasonable effort to maintain the Products consistent with good
general handling and storage practices and any supplemental instructions
provided by Universal Display. [The confidential material contained
herein has been omitted and has been separately filed with the
Commission.] All claims of any breach of the foregoing warranty must be
provided to Universal Display in writing during the warranty
period. In the event of a breach of the foregoing warranty, Universal
Display shall, at CMEL’s option (a) promptly replace any Products that are not
in compliance with the warranty at Universal Display’s sole expense; (b) accept
return of such Products and reimburse all the fees that CMEL paid Universal
Display on account thereof.
7.3 Further
Infringement Warranty by Universal Display. Universal Display
warrants to CMEL that, to the best of Universal Display’s knowledge, the
Products do not infringe the valid patent rights of any third
party. If CMEL is unable to use any Product because the Product
itself is held by a court of competent jurisdiction to infringe the patent
or
other intellectual property rights of any third party not an Affiliate of CMEL,
Universal Display shall, as CMEL’s remedy in addition to those set forth in
Article 7.2 above, accept return of any quantities of such Product no longer
reasonably useful to CMEL on account thereof and reimburse all fees that CMEL
paid Universal Display on account thereof. The foregoing shall be in
addition to any indemnification obligation of Universal Display under Article
8
below.
7.4 Disclaimer
of Additional Warranties. ALL OTHER WARRANTIES, EXPRESS OR
IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF
NON-INFRINGEMENT, VALIDITY, QUALITY, PERFORMANCE, MERCHANTABILITY OR FITNESS
FOR
A PARTICULAR PURPOSE, ARE HEREBY DISCLAIMED BY EACH PARTY. In
particular, Universal Display makes no representations or warranties that CMEL
will be able to make any specific use of the Products without obtaining
additional license rights from third parties. IN NO EVENT SHALL
UNIVERSAL DISPLAY’S LIABILITY FOR ANY BREACH OR ALLEGED BREACH OF REPRESENTATION
OR WARRANTY UNDER THIS AGREEMENT EXCEED [The confidential material contained
herein has been omitted and has been separately filed with the
Commission.].
7.5 Limitation
on Certain Damages. EXCEPT AS OTHERWISE PROVIDED IN ARTICLE
8 [The confidential material contained herein has been omitted and has been
separately filed with the Commission.], IN NO EVENT SHALL EITHER PARTY BE LIABLE
TO THE OTHER FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL
DAMAGES ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT. The
foregoing shall not limit either party’s liability to the other for: (a) any
claims of bodily injury or damage to tangible property resulting from such
party’s gross negligence or willful misconduct; (b) any unauthorized practice
under the other party’s patents or use of the other party’s proprietary
materials or information; or (c) any breach of the provisions of Article 6
respecting the other party’s Confidential Information.
7.6 Essential
Part of the Bargain. The parties acknowledge that the disclaimers
and limitations of liability set forth in this Article 7 reflect a deliberate
and bargained for allocation of risks between them are intended to be
independent of any exclusive remedies available under this Agreement, including
any failure of such remedies to achieve their essential purpose.
Article
8 Indemnification
8.1 Indemnity
by Universal Display. In accordance with Section 8.3 below,
Universal Display shall defend and/or settle any third-party claim or action
brought against CMEL and/or its officers, directors, suppliers, employees,
agents and representatives (each, a “CMEL Indemnified Person”), to the
extent such claim or action concerns [The confidential material contained
herein has been omitted and has been separately filed with the
Commission.]. In addition, Universal Display shall indemnify and hold
harmless the CMEL Indemnified Persons from and against any costs, damages,
fees and expenses (including reasonable attorneys’ fees) payable by any of them
to third parties in connection with such aforementioned claim or action;
provided, however, that Universal Display’s total liability under this section
shall not exceed [The confidential material contained herein has been omitted
and has been separately filed with the Commission.].
8.2 Indemnity
by CMEL. In accordance with Section 8.3 below and subject to
Universal Display’s fulfillment of its representations and/or warranties under
this Agreement, CMEL shall defend and/or settle any third-party claim or action
brought against Universal Display and/or its officers, directors, (each, a
“Universal Display Indemnified Person”), to the extent such claim or
action concerns [The confidential material contained herein has been omitted
and
has been separately filed with the Commission.]. In addition, CMEL
shall indemnify and hold harmless the Universal Display Indemnified Persons
from
and against any damages, fees and expenses (including reasonable attorneys’
fees) payable by any of them to third parties in connection with such
aforementioned claim or action.
8.3 Indemnification
Procedures. With respect to any claim or action for which
indemnification may be sought from a party under this Article 8, the person
or
entity seeking indemnification (the “Claimant”) shall promptly notify the
indemnifying party in writing, specifying the nature of the claim or action
and,
to the extent known, the total monetary amount sought or other such relief
as is
sought therein. The Claimant shall reasonably cooperate with the
indemnifying party, at the indemnifying party’s expense, in connection with the
defense and/or settlement of the claim or action. Provided the
indemnifying party admits its obligation to indemnify the Claimant hereunder,
indemnifying party shall have the right to control and conduct all proceedings
or negotiations in connection therewith, and to assume and control the defense
thereof. The Claimant shall have the right to employ separate counsel
to provide input into the defense, at its own cost. The indemnifying
party shall keep the Claimant reasonably informed of the progress of its defense
and settlement of the claim or action. The indemnifying party shall
not settle the claim or action on the Claimant’s behalf without first obtaining
the Claimant’s written approval, which approval shall not be unreasonably
withheld or delayed. The Claimant may not settle any claim or action
for which indemnification is sought hereunder without the indemnifying party’s
written approval, which approval shall not be unreasonably withheld or
delayed. Except as may be required by law, each party agrees not to
publicize any settlement without first obtaining the other party’s written
permission.
Article
9 Term
and Termination
9.1 Term. Unless
otherwise extended by mutual written agreement of the parties, the term of
this
Agreement shall commence on the Effective Date and shall continue until the
sooner of December 31, 2008, or the date on which this Agreement is terminated
as permitted hereunder.
9.2 Termination
for Breach. Either party may terminate this Agreement on written
notice to the other party if the other party materially breaches any of its
obligations under this Agreement and fails to cure such breach within thirty
(30) days following written notice thereof by the terminating
party.
9.3 Other
Termination. Either party may terminate this Agreement on written
notice to the other party if the other party permanently ceases conducting
business in the normal course, becomes insolvent or is adjudicated bankrupt,
makes a general assignment for the benefit of its creditors, admits in writing
its inability to pay its debts as they become due, permits the appointment
of a
receiver for its business or assets, or initiates or becomes the subject of
any
bankruptcy or insolvency proceedings which proceedings, if initiated
involuntarily, are not dismissed with sixty (60) days thereafter. In
addition, either party may terminate this Agreement on written notice to the
other party in the event of a change in control of such other party, whether
by
merger, acquisition or otherwise; provided, however, that such notice of
termination must be given within sixty (60) days following such party’s receipt
of notice of such merger or acquisition.
9.4 Survival. The
following provisions of this Agreement shall survive the expiration or earlier
termination of this Agreement: Articles 4, 5, 6 (according to Section
6.6), 7, 8, 9, and 10; any payment obligations of CMEL with respect to Products
received or for which Orders have been placed prior to the date of such
expiration or earlier termination; and any other provisions necessary to
interpret the respective rights and obligations of the parties
hereunder.
Article
10 Miscellaneous
10.1 Independent
Contractors. This Agreement is not intended by the parties to
constitute, create, give effect to, or otherwise recognize a joint venture,
partnership, or formal business organization of any kind. Each party
hereto shall act as an independent contractor, and neither shall act as an
agent
of the other for any purpose. Neither party has the authority to
assume or create any obligation, express or implied, on behalf of the
other.
10.2 Force
Majeure. Neither party shall be in breach of this Agreement for
any failure of performance caused by an event beyond its reasonable control
and
not due to its fault or negligence. In the event that such a force
majeure event occurs, the party unable to perform shall promptly notify the
other party of such non-performance and its expected duration. In
addition, such party shall in good faith maintain such partial performance
of
this Agreement as is reasonably possible, shall use all reasonable efforts
to
overcome the cause of nonperformance and shall resume full performance as soon
as is reasonably possible.
10.3 Non-Assignment. This
Agreement and the rights and obligations of the parties hereunder shall not
be
assigned or transferred by either party without the prior written consent of
the
other party, except that either party may assign or transfer this Agreement,
in
its entirety and on written notice to the other, to a successor in interest
to
all or substantially all of such party’s business to which this Agreement
relates, whether by merger, acquisition or otherwise, subject in any such case
to the other party’s right of termination under Section 9.3
above. Notwithstanding the foregoing, CMEL may not assign or transfer
this Agreement to a third party with whom Universal Display is then-engaged
in
litigation or other formal adversarial or dispute resolution proceedings
respecting any Universal Display products or technologies. Should
CMEL assign or transfer this Agreement, whether by merger, acquisition or
otherwise, to a third party with an existing OLED business, or should CMEL
acquire the existing OLED business of any third party, this Agreement shall
not
be utilized for the benefit of such third party’s OLED business unless expressly
agreed to by Universal Display in writing. Moreover, should Universal
Display have already entered into a similar agreement with the third party
at
the time of such assignment, transfer or acquisition, there shall be no
reduction of the payment or other obligations of CMEL under this Agreement
as
they pertain to CMEL’s OLED business, or of such third party under its similar
agreement as they pertain to such third party’s OLED business, unless expressly
agreed to by Universal Display in writing. Nothing herein shall
confer any rights upon any person other than the parties hereto and their
respective successors and permitted assigns.
10.4 Equitable
Relief. In the event of a party’s actual or reasonably
anticipated use of the other party’s proprietary materials (including, in the
case of Universal Display, the Products) in an unauthorized manner, infringement
of the other party’s patents, or breach of the provisions of Article 6
respecting Confidential Information of the other party, such other party shall
be entitled to injunctive or other equitable relief restraining such activity,
without the necessity of proving actual damages or posting any bond or other
security. Such relief shall be in addition to, and not in lieu of,
any other remedies that may be available, at law or equity, including, without
limitation, an action for the recovery of damages.
10.5 Choice
of Law; Dispute Resolution. This Agreement shall be governed by,
and construed and interpreted in accordance with, the laws of the State of
California, U.S.A., without respect to its rules on the conflict of
laws.
10.6 Notices. All
notices and other communications under this Agreement shall be in writing and
hand delivered or sent by facsimile or e-mail transmission with confirmation
of
receipt, commercial overnight courier with written verification of receipt,
or
certified or registered mail, postage prepaid and return receipt requested;
provided, however, that all notices concerning any dispute or any alleged breach
or termination of this Agreement, in whole or in part, must be sent by overnight
courier or certified or registered mail. Such notices and other
communications shall be effective when received if hand delivered, when sent
if
sent by confirmed facsimile or e-mail transmission, on the next business day
of
the recipient when sent by overnight courier, or five (5) business days after
deposit in the mail when sent by certified or registered mail. All
notices and other communications shall be directed to the parties at their
respective addresses as set forth below, or to such other address(es) as either
party shall provide to the other in a notice given in accordance
herewith.
All
Orders and any other notices respecting the Products, to:
Universal
Display
Corporation Chi
Mei EL Corporation
000
Xxxxxxxx
Xxxxxxxxx No.
1, Chi-Yeh Road
Ewing,
New
Jersey 08618 Tainan
Science-Based Xxxxxxxxxx Xxxx
X.X.X. Xxxxxx
00000, ROC
Attn:
Xxxxxx
Xxxxx Attn:
Xx. Xxxx-Xxx Xxx
Fax
No.:
(000)
000-0000 Fax
No.: 000-0-000-0000
Tel
No.:
(000) 000-0000
x000 Tel
No.: 886-6-505-1881 ext. 11418
E-mail:
xxxxxxx@xxxxxxxxxxxxxxxx.xxx E-mail:
xxxxxx@xxx.xxx.xx
All
other
notices and communications:
Universal
Display
Corporation Chi
Mei EL Corporation
000
Xxxxxxxx
Xxxxxxxxx Xx.
0, Xxx.0, Xxxxxxx Xxxx
Xxxxx,
Xxx
Xxxxxx 00000 Tainan
Science-Based Xxxxxxxxxx Xxxx
X.X.X. Xxxxxx
00000, ROC
Attn:
Xxxxxx X.
Xxxxxxxx Attn:
Xx. Xxxx-Tin Xxxxx
Fax
No.:
(000)
000-0000 Fax
No.: 000-0-000-0000
Tel
No.:
(000) 000-0000
x000 Tel
No.: 886-6-505-1889 ext. 13305
E-mail:
xxxxxxxx@xxxxxxxxxxxxxxxx.xxx E-mail:
xx_xxxxx@xxxx.xxx.xx
10.7 Amendments;
No Waivers. No modification of or addition to this Agreement
shall be effective unless it is in writing and signed by an authorized
representative of each of the parties hereto. The failure of either
party to assert any right hereunder, or to insist upon compliance with any
term
or condition herein, will not constitute a waiver of that right or excuse any
subsequent nonperformance of any such term or condition, or of any other term
or
condition, by the other party.
10.8 Severability. In
view of the possibility that one or more of the provisions of this Agreement
may
subsequently be declared invalid or unenforceable by court or administrative
decision, the parties hereto agree that invalidity or unenforceability of any
of
the provisions shall not in any way affect the validity or enforceability of
any
other provisions of this Agreement, except where the invalidated or
unenforceable provisions comprise an integral part of, or are otherwise clearly
inseparable from, such other provisions.
10.9 Entire
Agreement. This Agreement constitutes the entire agreement
between the parities with respect to the subject matter hereof and supersedes,
cancels and annuls all prior or contemporaneous negotiations or communications
between the parties with respect thereto.
10.10 Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed to be an original, but all of which taken together shall constitute
one
and the same instrument.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by
their duly authorized representatives:
Chi
Mei EL
Corporation Universal
Display Corporation
By: /s/
Xxxxx
Xxxx By: /s/
Xxxxxx X.
Xxxxxxxxxx
Name: Xxxxx
Xxxx Name:Xxxxxx X.
Xxxxxxxxxx
Title: President Title: Executive
Vice President
Date: 4/24/07 Date: 4/5/07
Exhibit
A
Products
and Product Pricing
[The
confidential material contained herein has been omitted and has been separately
filed with the Commission.]
At
the
beginning of each quarter, CMEL shall provide Universal Display with an estimate
of the quantity of each Product that it expects to order during the
quarter. [The confidential material contained herein has been omitted
and has been separately filed with the Commission.]
At
the
end of each quarter, Universal Display shall provide CMEL with a calculation
of
the actual quantity of material ordered for each Product and the price per
gram
that should have been charged based on the table above. Universal
Display shall promptly issue CMEL a credit memo for the amount of any
overpayment and an invoice for the amount of any underpayment. All
invoices shall be subject to the payment terms of Article 5 of the
Agreement.
Exhibit
B
Product
Specifications
[To
be
agreed upon separately.]
