GENERAL SIDE LETTER
This Side Letter is made as a DEED the day of July 2004
BETWEEN:
(1) TNCI UK Limited, Pacific House, Xxxxxxx Xxx, Xxxxxx Xxxxxxxx Xxxx, Xxxxx,
XX00 0XX; and
(2) LMIC Inc, 0000 Xxxxxxxx Xxxxx Xxxx, Xxxxxxxxxx, XX00000, XXX;
and reference to the parties shall be to the parties to this side letter.
PURPOSE:
The Purpose of this Side Letter is to vary and supplement the Agreement for the
Supply of Systems, Equipment and Services between (1) TNCI UK Limited And (2)
LMIC Inc dated 13 September 2003 (the "Agreement");
NOW IT IS AGREED as follows:
In consideration of the mutual covenants and conditions in this letter the
parties agree as follows:-
(1) Clause 1.1: Definitions
The following definition shall be added to Clause 1.1:
"Background System Materials" means any Intellectual Property
Rights in the System Materials,
other than any Intellectual Property
Rights that arise, are obtained or
developed by LMIC Inc. in the course
of or in connection with this
Agreement
(2) Clause 13.2: Notices and communications to the Contractor
Clause 13.2 be deleted and replaced with the following:
Notices and communications to the Contractor
All certificates decisions, instructions and orders, notices or other
communications required or permitted to be given or made by the TNCI UK to
the Contractor, including those made or given by the Engineer, under the
Contract shall be served or made in writing by sending the same, in all
cases, properly addressed to such other Party as set forth below or at
such other address as may be specified by the Parties hereto by written
notice sent or delivered in accordance with the terms hereof, by post,
nationally recognised commercial mail delivery service such as FedEx, UPS,
etc., e-mail, cable, or facsimile transmission to, or by leaving the same
at, the address nominate for that purpose below:
Notices to the Contractor shall be provided as follows:
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Rachid Mehdaova, Director of Services
LMIC, Inc.
0000 Xxxxxxxx Xxxxx Xxxx,
Xxxxxxxxxx, Xxxxxxxx 00000 XXX
Telephone: (000) 000.0000
Facsimile: (000) 000.0000 [need to check with Phil]
e-mail: xxxxxxxxx@xxxxxxx.xxx
(3) Clause 15.1: Ownership and licensing of System Materials
Clause 15.1 be deleted and replaced with the following:
Ownership and licensing of System Materials
The parties agree that the ownership and licensing of the Intellectual
Property Rights in the System Materials and for the avoidance of doubt the
design System shall be structured as follows:
(a) all Intellectual Property Rights in and to the System Materials or
the design of the System shall be assigned to TNCI UK under Clause
15.2, except for any Third Party Materials, Third Party Hardware,
Background System Materials;
(b) all Third Party Materials shall be governed by Clause 15.3;
(c) all Third Party Hardware shall be governed by Clause 15.4;
(d) where the parties have separately agreed in writing a licence for
any System Materials, the terms of that licence shall take
precedence over this Clause 15;
(e) where there are any other System Materials not covered by the above
provisions (including any Background System Materials), then these
shall be licensed to TNCI under Clause 15.5.
(4) Clause 15.5: Residual Licence
Clause 15.5 be deleted and replaced with the following:
Residual Licence
In relation to all System Materials (which for the avoidance, includes but
is not limited to, any Background System Materials) to which this Clause
applies:-
(a) the Contractor hereby grants to TNCI UK (by way of present and
future grant) an irrevocable royalty free licence without limit of
time to edit, modify, copy, adapt, exploit and do anything else with
or in relation to such System Materials which would otherwise be an
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infringement of any Intellectual Property Rights in or to such
materials, together with the right to grant sub-licences of all or
any of such rights (including this right of sub-licence) and a right
to assign this licence to any person (in each case without notice to
the Contractor); and after the contract is deemed to be terminated;
and
(b) the Contractor warrants to TNCI UK that it has the right to grant
the above licence and that the exercise of such licence by TNCI UK
will not infringe the Intellectual Property Rights of any third
party.
(5) Clause 15.7:
Clause 15.7 be deleted and replaced with the following:
Indemnity Against Infringement
(a) The Contractor shall defend and indemnify TNCI UK against all
actions, claims, demands, costs, charges and expenses arising from
or incurred by reason of any infringement or alleged infringement
caused or alleged to be caused by the use or possession of any
System supplied by the Contractor, letters patent, registered
design, unregistered design right; copyright, trade xxxx or trade
name, or any other third party's intellectual property right(s),
protected in the country where the System is to be assembled,
integrated, manufactured or installed, but such indemnity shall not
cover any use of the System otherwise than for the purpose indicated
by or reasonably to be inferred from the TNCI Requirement.
For the avoidance of doubt, the Contractor shall not be liable under
this indemnity for any actions, claims, demands, costs, charges and
expenses where such liability arises as a result of the display of
any offensive, illegal or immoral Contents or as a result of the
display of any Contents which infringes or is alleged to infringe
any third parties Intellectual Property Rights.
(b) Such obligation by Contractor to indemnify TNCI UK shall only arise
provided (i) TNCI UK shall notify Subcontractor immediately of any
such Claim, (ii) TNCI UK provides Contractor full authority to
defend and settle such Claim, and (iii) TNCI UK co-operates fully
with Contractor in the defence of such Claim. Notwithstanding the
foregoing, the Contractor shall only be relieved of its obligation
to indemnify TNCI UK under this clause if and to the extent that
TNCI UK's failure to comply with the requirements of the preceding
sentence materially interferes with Contractor's ability to defend
such Claims, or causes Contractor to incur additional expense.
(c) TNCI UK shall defend and indemnify the Contractor against all
actions, claims, demands, costs, charges and expenses arising from
or incurred by reason of any infringement or alleged infringement
caused or alleged to be caused by the use or possession of any
System supplied by TNCI UK to the Contractor of letters patent,
registered design, unregistered design right; copyright, trade xxxx
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or trade name, or any other third party's intellectual property
right(s), protected in the country where the System is to be
assembled, integrated, manufactured or installed, but such indemnity
shall not cover any use of the System otherwise than for the purpose
indicated by or reasonably to be inferred from the TNCI Requirement.
(d) Such obligation by TNCI UK to indemnify the Contractor shall only
arise provided (i) the Contractor shall notify TNCI UK immediately
of any such Claim, (ii) the Contractor provides TNCI UK full
authority to defend and settle such Claim, and (iii) the Contractor
co-operates fully with TNCI UK in the defence of such Claim.
Notwithstanding the foregoing, TNCI UK shall only be relieved of its
obligation to indemnify the Contractor under this clause if and to
the extent that the Contractors failure to comply with the
requirements of the preceding sentence materially interferes with
TNCI UK's ability to defend such Claims, or causes TNCI UK to incur
additional expense.
(6) Clause 17: Application Of Insurance Monies
Clause 17 be deleted and replaced with the following:
To any extent the Contractor is required to insure the System or Section
thereof for the benefit of TNCI UK, monies received under any such policy
shall be applied in or towards the replacement and repair of the part of
the System lost, damaged or destroyed but this provision shall not affect
the Contractor's liabilities under the Contract.
(7) Schedule 1 to Annexure 1: Development Price
Schedule 1 to Annexure 1 be deleted and replaced with the following. For
the avoidance of doubt, the parties agree and acknowledge (without
prejudice to any other sums paid) that the first 2 instalments have been
made in full:
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SCHEDULE 1 TO ANNEXURE 1
DEVELOPMENT PRICE
1. Development Price
$625,000 US dollars
2. Instalments
Amount Invoice Date
$250,000 US dollars the Effective Date, payable immediately
$125,000 US dollars Any date on or after the Effective Date as
TNCI UK determines
$250,000 US dollars On the later of delivery of the first
instalment of the Initial Order or the due
date for such delivery as set out in
Schedule 4 to the Supply Conditions
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(8) Supply Condition 3.2: Instalments
Supply Condition 3.2 be deleted and replaced with the following:
Instalments: Where the System or any part thereof is to be delivered in
Instalments, TNCI UK shall be entitled at its option to treat the Contract
as a series of separate contracts to supply each Instalment, or as a
single Contract to supply all Instalments. Where any System or any part
thereof are to be delivered in Instalments, unless otherwise elected by
TNCI UK, the Contract shall be a single contract to deliver all
Instalments.
(9) Supply Condition 7.4: Imports
Supply Condition 7.4 be deleted and replaced with the following:
Imports: The System or any part thereof shall by FCA (Free Carrier) in
accordance with Incoterms to the Delivery Location.
(10) Supply Condition 8.2: Rejection for non-conformity
Supply Condition 8.2 be deleted and replaced with the following:
Rejection for non-conformity: Until TNCI UK has accepted the System or any
part thereof, if any System or any part thereof are found not to be in
conformity with the Contract, TNCI UK shall be entitled to:-
(a) reject the System or any part thereof delivered;
(b) reject the System or any part thereof delivered and require the
Contractor to deliver replacement System or any part thereof
conforming with the Contract by a further Delivery Date specified by
TNCI UK; or
(c) accept those System or any part thereof which have been delivered
and require the Contractor to repair or rectify or pay the
reasonable cost of repairing or rectifying the System or any part
thereof.
(11) Supply Condition 9.3:PPI Increase
Supply Condition 9.3 be deleted and replaced with the following:
PPI Increase: NOT USED.
(12) Supply Condition 10.4: Payment Period
Supply Condition 10.4 be deleted and replaced with the following:
Payment Period: TNCI UK will pay to the Contractor the Supply Price and
any other amounts properly due and payable by it under the Contract:
(a) where the invoice is received between the 1st and 15th day of the
month (inclusive), on or prior to the 15th day of the month;
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(b) where the invoice is not received between the 1st and 15th day of
the month (inclusive),on or prior to the last day of the month;
following the month in which the Contractor's correct invoice for such
amounts was received in accordance with Supply Conditions 10.1 to 10.3
Contract UNLESS the parties agree otherwise in writing.
(13) Supply Condition 14.2: Requirements for Insurance
Supply Condition 14.2 be deleted and replaced with the following:
Requirements for Insurance: All insurance shall be maintained with a
member of the Association of British Insurers or with Lloyds' underwriters
or the with an equivilant insurance provider in the United States of
America and shall, unless otherwise stated, be for such amount as is
prudent in all the circumstances.
(14) Supply Condition 15.1: Contractors Default
Supply Condition 15.1 be deleted and replaced with the following:
Contractor's Default: If:
(a) the Contractor shall assign the Contract without the prior consent
of TNCI UK, or
(b) the Contractor shall sub-let the whole of the Contract without the
prior consent of TNCI UK; or
(c) if the Engineer has rejected the System or a Section under Supply
Condition 6.5 (Failure upon testing) and the reason for such
rejection has not been remedied by the Contractor as provided
thereby, or
(d) the Engineer shall certify that the Contractor:
(i) has abandoned the Contract or any Order; or:
(ii) has without reasonable excuse suspended the performance of the
Order or Contract as the case may be for 30 days after
receiving from the Engineer written notice to proceed, or
(iii) despite previous warnings in writing from the Engineer is not
manufacturing the System in accordance with the Contract, or
is failing to proceed with due diligence or is neglecting to
carry out his obligations under the Contract so as to affect
adversely the performance of the Contract,
(e) There is an endemic or epidemic failure failure of the System or any
part thereof to conform with the Contract;
then TNCI UK may give 21 days' notice to the Contractor of his intention
to proceed in accordance with the provisions of this clause. Upon the
expiry of such notice TNCI UK may without prejudice to any other remedy
under the Contract forthwith terminate the Contract and/or at its
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discretion any Order made pursuant to the Contract but without thereby
releasing the Contractor from any of his obligations or liabilities which
have accrued under the Order and/or Contract and without affecting the
rights and powers conferred by the Contract on TNCI UK or the Engineer.
Upon such termination TNCI UK shall be entitled either to purchase systems
in substitution for the System.
(15) Schedule 5 to Annexure 2: TNCI Order Form
Schedule 1 to Annexure 2 be deleted and replaced with the following:
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SCHEDULE 5 TO ANNEXURE 2
TNCI ORDER FORM
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Contract Vehicle No Cars Checksum [Delivery Date] [Delivery Date]
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
[insert details]
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
[insert details]
===================================================== ================ ================= ================ ================
Total Systems
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Cum Trainsets
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
1 car set comprises (typically)
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Master Controller TM
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Monitor TVU
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Audio Amp TAVR
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Audio Spkr TAD
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Ethernet TWEC
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Vehicle antenna equipment
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
TAV Audio detector
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
SDCS
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Station Antenna
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
SWEC
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Manufacturing Plan for Systems
---------------------------------------------------------------------------------------- ---------------- ----------------
-------------------------------- -------------------- ---------------------------------- ---------------- ----------------
Reqd
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
Balance demand
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
variance
-------------------------------- -------------------- ---------------- ----------------- ---------------- ----------------
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General
(15) This Deed shall be governed by and shall be construed in accordance with
the laws of England and the parties hereby agree to submit to the
exclusive jurisdiction of the Courts of England.
(16) This Deed may be executed in any number of counterparts each of which when
executed and delivered is an original but all the counterparts together
constitute the same document.
(17) No person other than the parties to this Deed shall have the benefit of or
the rights to enforce any term of this Deed and the Contracts (Rights of
Third Parties) Xxx 0000 shall not apply. The parties agree and acknowledge
that the Contractor has no right to enforce any term of this Side Letter.
(18) In this Deed words and expressions defined in the Agreement and not
otherwise defined in this Deed shall have the meanings given to them in
the Agreement.
(19) A reference to a "paragraph" or "appendix" in this Deed shall mean a
reference to a paragraph or appendix of this Deed of Assignment unless
otherwise stated.
(20) The parties agree and acknowledge that the time limit within which any
action can be brought under this Side Letter shall be 6 years from the
date on which the cause of action accrued.
(21) This Deed is made without prejudice to the terms of the Agreement save
that in the event of any inconsistency or conflict between any provision
of this Deed and a provision of the Agreement the relevant provision of
this Deed shall take precedence and prevail.
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SIGNATURE PAGE
IN WITNESS of which the parties have executed this Deed on the date first above
written.
--------------------------------------
EXECUTED AS A DEED BY: Sign here:
TNCI UK LIMITED
acting by /s/ Xxxxx Xxxxxx
Xxxxx Xxxxxx
Director
Director/Secretary /s/ Xxxxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxxxxx
--------------------------------------
SIGNED AS A DEED on behalf of: Sign here:
LMIC INC, a corporation incorporated
in the United States of America by
Xxxx X. Xxxxxxx, President and COO /s/ Xxxx X. Xxxxxxx
being a person who in accordance Xxxx X. Xxxxxxx
with the law of that territory is Prsident & CEO
acting under the authority of the
corporation
--------------------------------------
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