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Exhibit 10.26
TECHNICAL ASSISTANCE
AND LICENSE AGREEMENT
XXXXX-XXXXXXXX GLASS CONTAINER INC., a corporation organized and existing
under the laws of the State of Delaware, with its principal office at One
XxxXxxx, Xxxxxx, Xxxx 00000, hereinafter called "Xxxxx", and CONSUMERS PACKAGING
INC., a corporation organized and existing under the laws of Canada, with its
principal office at 000 Xxx Xxxx Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxx, Xxxxxx,
hereinafter called "Licensee", have agreed as follows:
Xxxxx has considerable expertise in the manufacture of glass containers,
and Licensee desires that Xxxxx provide certain manufacturing consulting
services and associated technological and patent licenses to assist Licensee in
the manufacture of glass containers.
Xxxxx represents that it has a strict policy and program for compliance
with the antitrust laws, regulations and court decisions, and that such services
and licenses will be provided in a manner consistent with such policy and
program.
Based upon the foregoing understandings, the parties have agreed as
follows:
1. For all purposes of this Agreement
(a) The term "Affiliate" shall mean, with respect to any person, any
person which directly or indirectly controls or is controlled by or is under
common control with such person.
(b) The term "control" (including the terms "controlling",
"controlled by" and under "common control with") shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of a person.
(c) The term "Antitrust Sensitive Information" shall mean any
information (including, without limitation, information relation to pricing,
costs, sales, credit, marketing or
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production capacity) which, in the opinion of the party requested to disclose or
license such information, is sensitive from the standpoint of the antitrust laws
of the United States or any political subdivision thereof (the "antitrust laws")
and the disclosure or licensing of which, in the opinion of such party would be
inappropriate from the standpoint of the antitrust laws or would result in a
violation of the antitrust laws.
(d) The term "Xxxxx" shall mean Xxxxx-Xxxxxxxx Glass Container Inc.
(e) The term "Xxxxx Group" shall mean Xxxxx and all Affiliates of
Xxxxx engaged in the manufacture of Licensed Products.
(f) The term "Licensee Group" shall mean Licensee and all
Subsidiaries of Licensee operating within the Licensed Territory which (i)
manufacture Licensed Products and (ii) accept the obligations of this Agreement
in writing as set forth in Attachment 1. A current list of members of the
Licensee Group is set forth in Attachment 2, which may be amended from time to
time by the parties.
(g) The term "Licensee Group Technical Information" shall mean all
technical facts, information, data or advice, whether written or oral
(including, without limitation, reports, letters, drawings, training and
operating manuals, specifications, bills of materials, photographs,
advertisements, and the like), relating to furnaces, compositions, product
designs, machines, molds, methods, techniques, processes, factory and
administration management, which facts, information, data or advice are utilized
commercially by any member of Licensee Group in the manufacture, processing,
inspecting, testing and packaging of Licensed Products in the regular course of
its business throughout the term of this Agreement, but shall not include:
(i) any facts, information, data or advice that any member of
Licensee Group receives from third parties and which may not lawfully be
disclosed by such member or the
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utilization of which requires the payment by any member of the Licensee Group of
royalties to third parties, except as provided in the following sentence;
(ii) any facts, information or data that any member of
Licensee Group develops for, or in cooperation with, third parties, and which
such member is obliged to maintain in confidence, except as provided in the
following sentence; and
(iii) any Antitrust Sensitive Information.
In the event that Licensee and Xxxxx agree that any facts, information,
data or advice described in clause (i) or (ii) above shall be of significant
interest to Xxxxx or important to the implementation of this Agreement, Licensee
shall, at Xxxxx' request, use reasonable efforts to obtain the consent from any
such third party to permit disclosure of such information to Xxxxx, provided,
however, that in the event Licensee shall be required to pay royalty fees or
incur other costs for the use of such information. Licensee will notify Xxxxx in
writing of the type of information and the amount of royalty fees or other costs
associated with the use of such information by Xxxxx and Xxxxx shall have the
option to receive such information if Xxxxx shall agree, in writing, to pay such
royalty fees and other costs in addition to any other amounts required to be
paid by Xxxxx under the terms of this Agreement.
(h) The term "Licensed Products" shall mean soda-lime glass
containers such as bottles and jars made substantially of vitreous soda-lime
silicate composition.
(i) The term "Technical Information" shall mean all technical facts,
information, data or advice, whether written or oral (including, without
limitation, reports, letters, drawings, training and operating manuals,
specifications, bills of materials, photographs, advertisements, and the like),
relating to furnaces, compositions, product designs, machines, molds, methods,
techniques, processes, factory administration and scheduling management, and
access to associated computer
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services available (as provided in the second following sentence) from Xxxxx or
any transferee of Xxxxx' computer services department, which facts, information,
data, advice or computer services are utilized commercially in the Licensed
Territory by any member of the Xxxxx Group in the manufacture, processing,
inspecting, testing and packaging of Licensed Products in the regular course of
its business throughout the term of this Agreement, including multiple gob
narrow neck press and blow forming technology and equipment and the rights
thereto as developed by Xxxxx or acquired by Xxxxx from Xxxxxxx Xxxx of
Obernkircken, Federal Republic of Germany (the multiple gob narrow neck press
and blow forming technology, including applicable know-how and trade secrets and
equipment as the same may be improved and upgraded from time to time, shall be
collectively referred to as the "Multiple Gob Press and Blow Technology"), but
shall not include:
(i) any facts, information, data, advice or computer services
that any member of the Xxxxx Group receives from third parties and which may not
lawfully be disclosed by such member, or the utilization of which requires the
payment by any member of the Xxxxx Group of royalties to third parties, except
as provided in the following sentence;
(ii) any facts, information, data, advice or computer services
that any member of the Xxxxx Group develops for, or in cooperation with, third
parties, and which such member is obliged to maintain in confidence, except as
provided in the following sentence;
(iii) any facts, data, formulas, compositions, processes,
apparatus, computer programs, compilations of information or any other patented
or unpatented technology, information or equipment relating to the Xxxxx
development known as *** or
(iv) any Antitrust Sensitive Information.
In the event that Xxxxx and the Licensee agree that any facts,
information, data, advice or computer services described in clause (i) or (ii)
above shall be of significant interest to Licensee or
*** Confidential treatment requested pursuant to Rule 406.
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important to the implementation of this Agreement, Xxxxx shall, at Licensee's
request, use reasonable efforts to obtain the consent from any such third party
to permit disclosure of such information to Licensee Group; provided, however,
that in the event Xxxxx shall be required to pay royalty fees or incur other
costs for the use of such information, Xxxxx will notify Licensee in writing of
the type of information and the amount of royalty fees or other costs associated
with the use of such information by Licensee Group and Licensee Group shall have
the option to receive such information if Licensee shall agree, in writing, to
pay such royalty fees and other costs in addition to any other amounts required
to be paid by Licensee Group under the terms of this Agreement. Xxxxx and
Licensee acknowledge and agree that (i) design and analytical computer services
shall be available for use only at an Xxxxx Group facility or an Xxxxx Group
controlled program bank and then only under the control and supervision of Xxxxx
personnel to help solve problems (the design and analytical computer programs
themselves not being an item of Technical Information to be transferred to
Licensee Group); (ii) object code type, administrative process control, and
financial computer programs may be transferred to Licensee Group, and (iii)
computer programs which function to provide management information (e.g.,
programs for product information computer and control system supervisory
computer) or function to control machinery/equipment provided by any member of
the Xxxxx Group (e.g., programs for Com-Soc, Auto-Mot, batch computing furnace
computer and glass conditioning computer) shall be provided by Xxxxx only as an
integral part of such machinery/equipment unless otherwise specifically agreed
upon by Xxxxx, all computer programs being considered trade secrets of Xxxxx.
(j) The term "Licensed Territory" shall mean the United States of
America, and the Dominion of Canada.
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(k) The term "Licensed Patent" shall mean any patent of the Licensed
Territory pertaining to Licensed Products, including the manufacture thereof,
owned or acquired by Xxxxx or in which Xxxxx has or acquires licensable rights
during the term of this Agreement and which is based on any item of Technical
Information.
(l) The term "Licensed Trade Secret" shall mean any and all
Technical Information of a confidential nature or in which Xxxxx has licensable
proprietary rights such as formulas, processes, apparatus, compilations of
information and the like which is used by Xxxxx in the Licensed Territory to
give it an advantage over competitors who do not use it and which is designated
in writing as a trade secret at the time of disclosure or thereafter. It is
understood that the term "Licensed Trade Secret" shall include both industrial
and commercial trade secrets.
(m) The term "Net Sales Price" shall mean the sales price for
shipments of Licensed Products as itemized on customer invoices, debit memos and
credit memos net of (i) discounts and allowances made in the ordinary course of
business, (ii) expenses relating to freight, transportation, insurance,
packaging and non-glass accessories or components, (iii) sales and use taxes and
other similar governmental charges and (iv) returns for credit. In the case of
Licensed Products sold by Licensee Group to any other person which is so closely
allied to Licensee Group as to prevent arm's-length bargaining, the Net Sales
Price shall be no lower than the net sales price charged by such seller for
similar products sold in the same period to customers not thus closely allied.
No member of Licensee Group shall change the method or system it uses to invoice
customers, or otherwise change its accounting methodology, in order to reduce
the amount of payments to be made to Xxxxx under paragraph 6.
(n) The term "person" shall mean any natural person, corporation,
division of a corporation, business trust, joint venture, association, company
or partnership.
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(o) The term "Prime Rate" shall mean at any time the rate of
interest per annum publicly announced from time to time by Citibank, N.A. as its
prime rate in effect at its principal office in New York, New York.
(p) The term "Subsidiary" shall mean a person, a majority of the
total outstanding Voting Power of which is owned, directly or indirectly, by
Xxxxx or Licensee.
(q) "Voting Power" when used with reference to the capital stock of,
or other ownership interest in, any person shall mean the power under ordinary
circumstances (and not merely upon the happening of a contingency) to vote in
the election of directors of such person (if such person is a corporation) or to
exercise rights in respect of such person equivalent to the right to vote in the
election of directors (if such person is not a corporation).
2. During the term of this Agreement, Xxxxx shall:
(a) Have its representatives meet from time to time, and whenever
reasonably requested by Licensee, with representatives of Licensee Group to
review the scope and content of any Technical Information of interest to
Licensee Group and to work out with Licensee practical procedures for promptly
conveying any item of Technical Information to Licensee Group.
(b) Furnish Licensee Group on a timely basis with copies of
technical reports and manuals relating to any item of said Technical Information
which are prepared from time to time by any member of the Xxxxx Group for
distribution among plants in the Licensed Territory and which in the judgment of
Xxxxx may be of interest to Licensee Group.
(c) Furnish or make available to the designated representative of
Licensee Group, on a timely basis, any Technical Information requested by any of
them; provided, however, that requests shall in each case be specific items of
Technical Information, and the obligation of Xxxxx hereunder shall be limited:
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(i) to supplying drawings, manuals, specifications, bills of
material, and the like, only to the extent that Xxxxx has prepared such material
for its own use, or for the use of third parties; and
(ii) as to all Technical Information, to cause each such
request to be fully and fairly answered to the best of the ability of Xxxxx.
Upon receipt of invoices from Xxxxx from time to time, Licensee shall
promptly reimburse Xxxxx for any expenses at Xxxxx' normal internal costs which
Xxxxx shall incur, including freight, shipping expenses and reproduction of
documents, in furnishing information requested by Licensee Group pursuant to
this paragraph 2.
3. Xxxxx shall, upon Licensee's prior written request:
(a) Arrange for duly authorized representatives of Licensee Group to
visit factories, selected by Xxxxx, where Technical Information is used in
manufacturing, testing and inspecting Licensed Products, and to inspect, at such
factories, all such operations utilizing Technical Information, provided,
however, that Xxxxx shall not be obligated to arrange for visits to an extent
that by reason of the number of visits or the number of representatives, such
visits will interfere with the operation of such factories, provided, further,
that Xxxxx shall not expose representatives of Licensee Group to Antitrust
Sensitive Information.
(b) Make available to Licensee Group at offices, factories or
laboratories of Xxxxx, the services of representatives of Xxxxx, who are
familiar with the manufacture of Licensed Products, for consultation and advice
concerning Licensee Group's manufacture thereof.
(c) Arrange for representatives of Xxxxx to consult with and advise
Licensee Group on the purchase by Licensee Group from third parties of any
machines or devices which are used by Xxxxx in the manufacture, testing or
inspection of Licensed Products.
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(d) Xxxxx shall not be required to provide more than *** man-days of
all the services described in paragraph 3(a), 3(b) and 3(c) above in any
calendar year.
(e) Make available to Licensee Group at the plants of Licensee Group
in the Licensed Territory the services, for not more than an aggregate of ***
man-days in any calendar year, of one or more representatives of Xxxxx who are
familiar with the commercial manufacture of Licensed Products for consultation
and advice concerning the Licensee Group's manufacture thereof.
(f) When such consultation takes place away from the Xxxxx
representative's place of regular employ, Licensee Group shall pay Xxxxx the
amount of (i) the reasonable travel and subsistence expenses which will be
incurred by any such representative in traveling from his place of regular
employ, visiting, and returning to his place of regular employ from the plants
of Licensee Group, and (ii) the total cost to Xxxxx of any such representative,
for the entire period any such representative is away from his regular place of
employ for consultation with Licensee Group.
4. (a) Each member of Licensee Group agrees that all Technical Information
made available or disclosed by Xxxxx in accordance with the terms of this
Agreement is solely for Licensee Group's use in the Licensed Territory in
accordance with this Agreement and shall remain the property of Xxxxx, and that,
for the term of this Agreement plus five (5) years from termination, each member
of Licensee Group will take all reasonable care to keep any and all such
Technical Information confidential and shall not disclose such Technical
Information to any third party (including, without limitation, any person that
has an ownership interest in any member of Licensee Group, unless such person
otherwise has right of access to Technical Information under this Agreement) or
to any director of any member of Licensee Group who is known to Licensee to be
an officer, director, partner, employee or at least 10% stockholder of any
person that (x) is a commercial customer or an Affiliate of a commercial
customer for glass containers (a "Customer") or (y) is
*** Confidential treatment requested pursuant to Rule 406.
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engaged in the manufacture or is an Affiliate of a person engaged in the
manufacture of rigid containers of glass, metal or plastic (a "Manufacturer"),
unless such Technical Information (i) becomes generally available to the public
other than as a result of a disclosure by, or other wrongful act of, any member
of Licensee Group, (ii) was lawfully available to any member of Licensee Group
or any of its Affiliates from a source other than an Xxxxx Group or an Xxxxx
Group authorized source on a nonconfidential basis prior to its disclosure by
any member of Xxxxx Group, (iii) becomes available to any member of Licensee
Group on a nonconfidential basis from a source other than any member of Xxxxx
Group or an Xxxxx Group authorized source, provided that such source is not
bound by a confidentiality agreement with any member of Xxxxx Group known to any
member of Licensee Group or (iv) is required by applicable law to be disclosed.
(b) Each member of Licensee Group agrees to provide the security
necessary to protect Licensed Trade Secrets under the laws of the State of Ohio
and the laws of the United States of America.
(c) Further, and without limitation on the other particular
obligations of confidence recited herein, none of the members of Licensee Group
shall disregard the obligations of confidence by using the Technical Information
given any member of Licensee Group to guide a search by it of publications and
other publicly available information, to select a series of items of knowledge
from unconnected sources, and to fit them together by use of the integrated
disclosure of Technical Information from Xxxxx to justify its disregard of the
obligations of confidence.
(d) None of the members of Licensee Group has the right to disclose
Technical Information which it is obliged to maintain in confidence under
paragraph 4(a) to any subcontractor without prior approval by Xxxxx. Such
consent shall not be withheld if the
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subcontractor is reasonably acceptable to Xxxxx and appropriate safeguards are
provided to protect the confidentiality of, and any proprietary rights of Xxxxx
in, such material.
(e) Xxxxx and Licensee agree that each member of Licensee Group can
fulfill its obligations of confidentiality by instituting and maintaining
reasonable security precautions, which may include confidentiality agreements
for appropriate employees and limited access to Technical Information within
Licensee Group's organization on a need-to-know basis.
5. Xxxxx hereby grants to Licensee Group, for the term of this Agreement,
a non-transferable (except as provided herein), non-exclusive, indivisible right
and license in the Licensed Territory to use Technical Information (including,
without limitation, Licensed Patents and Licensed Trade Secrets) in the
manufacture, use and sale of Licensed Products. This license does not include
the right to manufacture machinery and equipment embodying Technical Information
in the Licensed Territory, provided that members of Licensee Group may
manufacture molds for the exclusive use of members of Licensee Group so long as
any molds which incorporate Technical Information are not transferred to any
third party or may manufacture Customer-owned molds not incorporating Technical
Information which molds may be transferred to such Customer or at such
Customer's direction. This Agreement does not restrict the sale throughout the
world of Licensed Products made in the Licensed Territory by any member of
Licensee Group; provided, however, that each member of Licensee Group
acknowledges that this Agreement does not grant to any member of Licensee Group
any license under the patents, trade secrets or other intellectual property
rights of Xxxxx in any country outside of the Licensed Territory.
6. In consideration of the performance of the obligations of Xxxxx under
paragraphs 2 and 3, and of the rights granted in respect of Technical
Information (including Licensed Patents and Licensed Trade Secrets under
paragraphs 4 and 5), and in addition to the payment of expenses as
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provided in paragraphs 2 and 3, Licensee Group shall pay and remit to Xxxxx
royalty payments equal to *** of the Net Sales Price of all Licensed Products
manufactured under this license which are sold or otherwise transferred by
Licensee Group during the term of this Agreement. Such royalty payments shall be
calculated during the term of this Agreement as of the end of each calendar
quarter and, to the extent applicable, amounts denominated in a foreign currency
shall be converted into United States Dollars using the official exchange rate
if one exists or otherwise at the exchange rate announced by Citibank, N.A. of
New York, New York as of such date.
It is understood and agreed that these royalty payments based upon Net
Sales Price are for the administrative convenience of the parties in avoiding
determinations of the extent of the use of the various Licensed Patents and
Licensed Trade Secrets, and associated bookkeeping and reporting, and include
the payment for patent rights under the Licensed Patents.
In addition to the patent licenses and rights obtained under the Licensed
Patents, the parties agree that the royalty payments based on Net Sales Price
are in consideration for the right of access to Technical Information, the right
to use unpatented Technical Information and Licensed Trade Secrets, the right of
access to Xxxxx' technical representatives, and the right to access of and use
of patented and unpatented improvements in Technical Information. The parties
agree that the fair value of these rights and licenses is as specified herein.
Licensee Group shall further pay all taxes and governmental impositions of
every character, other than income and similar taxes (including those which must
be withheld by Licensee Group on account for Xxxxx), required by law to be paid
by Xxxxx or any member of Licensee Group as a tax upon, or as a condition or
prerequisite of receipt of, payments provided for by this paragraph 6 or by
other provisions of this Agreement. As to any income and similar taxes withheld
from payment
*** Confidential treatment requested pursuant to Rule 406.
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hereunder. Licensee Group shall provide Xxxxx with certificates evidencing the
payment and amount of such taxes.
It is contemplated by the parties that Licensee will be responsible for
collecting all reports and payments due Xxxxx and to deliver such reports and
payments to Xxxxx to insure the performance of the terms and conditions of this
Agreement by the members of Licensee Group. Notwithstanding anything to the
contrary contained herein, each member of the Licensee Group shall be jointly
and severally responsible for the full performance of all of the obligations of
the Licensee Group hereunder.
7. (a) All obligations of Licensee Group under this Agreement shall be
paid at such place as Xxxxx shall designate and in United States Dollars.
Payments under paragraph 6 shall be made within thirty (30) days after the end
of each calendar quarter for all Licensed Products sold or otherwise transferred
by Licensee Group during said calendar quarter. All other payments due Xxxxx by
Licensee Group under this Agreement shall be made within thirty (30) days after
receipt of Xxxxx' invoice.
(b) Any payments not made by Licensee Group to Xxxxx on or before
the due date thereof shall bear interest from and after the due date at the
Prime Rate in effect on the date payment is due, such interest rate to be
adjusted at the beginning of each calendar month thereafter. Even though
nonpayment by Licensee Group might result in termination of this Agreement by
Xxxxx, such interest shall continue to accrue until complete payment including
accrued interest is made. Licensee Group's obligations under this paragraph to
pay such accrued interest to Xxxxx at the earliest possible time shall not be
nullified by the occurrence of any contingency referred to in paragraph 17
hereof.
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8. Each member of Licensee Group shall keep accurate records showing the
quantity, gross sales prices, allowable deductions, Net Sales Price, purchasers,
and date of sale or other transfer of all Licensed Products sold or otherwise
transferred by such member during the term of this Agreement, and Licensee shall
furnish Xxxxx, within thirty (30) days after the end of each calendar quarter, a
certificate signed by an officer of Licensee showing the aggregate Net Sales
Price for all Licensed Products sold or otherwise disposed of by each such
member of Licensee Group during said calendar quarter. Licensee Group shall,
upon written request by Xxxxx, make said records available for inspection at its
place of business during normal business hours and on a confidential basis, by
an independent Certified Public Accountant of national standing which is
designated by Xxxxx (and which is reasonably acceptable to Licensee) who shall
certify to Xxxxx only the amount of payments due for the period examined. Such
Certified Public Accountant shall agree not to communicate to Xxxxx or any other
member of Xxxxx Group any information which it shall acquire during such
inspection, other than the amount of payments due to Xxxxx. In the event of any
disagreement between Licensee and Xxxxx as to the amount of payments due Xxxxx
arising solely as a result of a disagreement in the calculation of the
royalties, Licensee and Xxxxx agree that the amount of payments certified by
such Certified Public Accountant shall, absent manifest error, be deemed to be
the amount of payments due to Xxxxx.
9. (a) To permit both parties to obtain the full benefits of an efficient
exchange of technical information, Licensee Group shall permit, upon the prior
written request of Xxxxx, duly authorized representatives of Xxxxx to inspect
Licensee Group plants manufacturing Licensed Products, provided, however, that
Licensee Group shall not be obligated to permit visits to an extent that by
reason of the number of visits or the number of representatives such visits will
interfere with the operations of Licensee Group plants, provided, further, that
Licensee Group shall not expose
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Xxxxx' representatives to Antitrust Sensitive Information. Xxxxx will bear all
of the expenses of its representatives during the visits described in this
paragraph.
(b) Licensee Group shall convey or transmit any specific item of
information on Licensed Products at its disposal, which is utilized by Licensee
Group commercially in the manufacture of Licensed Products, during such visits
or in response to requests for such information by Xxxxx at other times, except
information that Licensee Group is bound to keep secret or confidential in
accordance with a contract with a third party or information which is Antitrust
Sensitive Information.
(c) Xxxxx agrees that all Licensee Group Technical Information made
available or disclosed by any member of Licensee Group in accordance with the
terms of this Agreement is solely for the use of the Xxxxx Group and shall
remain the property of such member, and that, for the term of this Agreement
plus five (5) years from termination, each member of Xxxxx Group will take all
reasonable care to keep any and all such Licensee Group Technical Information
confidential, and shall not disclose such Licensee Group Technical Information,
unless such Licensee Group Technical Information (i) becomes generally available
to the public other than as a result of a disclosure by, or other wrongful act
of, any member of Xxxxx Group, (ii) was available to any member of Xxxxx Group
or any of its Affiliates on a nonconfidential basis prior to its disclosure by
any member of Licensee Group, (iii) becomes available to any member of Xxxxx
Group on a nonconfidential basis from a source other than any member of Licensee
Group, provided that such source is not bound by a confidentiality agreement
with any member of Licensee Group known to any member of Xxxxx Group or (iv) is
required by applicable law to be disclosed. Xxxxx agrees to provide the security
necessary to protect Licensee's proprietary information under the laws of the
State of Ohio and the laws of the United States of America.
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(d) Upon receipt of invoices from Licensee from time to time, Xxxxx
shall promptly reimburse Licensee Group for any expenses incurred by Licensee
Group in furnishing information requested by Xxxxx pursuant to this paragraph 9
(including, without limitation, expenses relating to freight, shipping and the
reproduction of documents), at a rate equal to Licensee Group's normal internal
costs for such services.
10. Each member of Licensee Group agrees to grant to each member of Xxxxx
Group for a reasonable royalty to be negotiated, and on terms and conditions
substantially similar to the terms and conditions of this Agreement, a
nonexclusive, nontransferable, indivisible right and license to make, use and
sell Licensed Products in any country of the world under any Licensee Group
Technical Information relating to Licensed Products or the manufacture thereof
owned by Licensee Group during the term of this agreement.
11. (a) Xxxxx will use its best efforts in providing consulting advice and
technical services under this Agreement, although Xxxxx does not guarantee or in
any way warrant that Licensee Group will achieve specific performance objectives
through implementation of Xxxxx' Technical Information or advice.
(b) Xxxxx makes no warranty or representation that Licensee Groups'
utilization of Technical Information in the Licensed Territory will not infringe
patents valid therein which are owned by parties other than Xxxxx, nor any
warranty or representation as to the validity or scope of any patent under which
a license is granted to Licensee Group under this Agreement. The obligations of
Licensee Group to Xxxxx shall be in no way affected, and no obligation of any
character of Xxxxx to Licensee Group shall be created, by the fact that the
utilization of any Technical Information in the Licensed Territory might
infringe the patent rights of others. Licensee
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Group assumes all risks of liability to any third person by reason of
infringement of patents or other rights owned by third persons.
(c) Licensee Group assumes all legal risks of claims and lawsuits
(including but not limited to product liability claims, health and safety
related claims, environmental pollution related claims and patent infringement
claims) associated with Licensee Group's implementation of advice or Technical
Information received from Xxxxx, and Licensee Group agrees to indemnify and hold
Xxxxx harmless against all reasonable costs, expenses and damages which may
result to Xxxxx from Licensee Group's implementation of advice or Technical
Information from Xxxxx. It is understood, however, that Xxxxx shall provide
reasonable assistance in defense of any such claims based on the Licensee
Group's use of Technical Information as received from Xxxxx at Licensee Group's
request and expense.
12. (a) This Agreement shall become effective as to Licensee and Xxxxx
upon the date (the "Effective Date") that: (i) this Agreement shall have been
executed by each of the parties and (ii) the Closing (as defined in Section 2.07
of that Asset Purchase Agreement, dated as of December 18, 1996, among Anchor
Glass Container Corporation, Licensee and Xxxxx) shall have occurred, and shall
be effective until the fifth anniversary of the Effective Date (the "Expiration
Date"). It is understood, however, that Licensee shall have the option to extend
the term for an additional five (5) year period after the Expiration Date under
the same terms and conditions by providing Xxxxx with written notice of its
intent to so extend at least one year prior to the Expiration Date.
(b) In the event that the aggregate amount of royalties paid to
Xxxxx under paragraph 6 with respect to the period beginning on the Effective
Date and ending on the date two years following the Effective Date do not equal
at least *** , Xxxxx and
*** Confidential treatment requested pursuant to Rule 406.
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Licensee shall negotiate in good faith to amend the royalty rate to provide an
adequate return to Xxxxx for a negotiation period not to exceed six months from
the second anniversary of this Agreement. If Xxxxx and Licensee are unable to
agree upon an amendment to the royalty fee as provided in this clause (b) during
such six month period, then Xxxxx shall have the unilateral right to terminate
this Agreement upon 30 days' prior written notice to Licensee.
13. In the event that at the time of any termination of this Agreement
(other than (i) a termination by Xxxxx under paragraph 12(b) or 14(a) or (ii)
any termination of this Agreement by a trustee, receiver or similar official in
a bankruptcy, receivership or similar proceeding in respect of any member of the
Licensee Group), any member of Licensee Group is using any Technical
Information, then, upon written request to Xxxxx made prior to any such
termination, Xxxxx shall grant Licensee Group a non-exclusive, nontransferable
(except as described below), perpetual license to utilize such Technical
Information. Any license granted under this paragraph shall contain provisions
(i) for payment of a reasonable royalty to be agreed upon between Xxxxx and
Licensee or determined as provided hereinafter, (ii) for periodic inspection by
an independent Certified Public Accountant of national standing which is
designated by Xxxxx (and which is reasonably acceptable to Licensee) who shall
agree not to communicate to Xxxxx any information which it shall obtain during
such inspection, other than the amount of royalty fees due to Xxxxx, of Licensee
Group's books and records relating to the royalties payable who shall certify to
Xxxxx only the amount of royalty payments due for period examined, (iii) for the
cancellation of the license upon failure of any member of Licensee Group to
permit the inspection of its books and records as herein provided, (iv) for the
transfer or extension of the license to any member of the Licensee Group
(whether or not such members exists at the time of termination), and (v) for
maintaining the confidentiality of such Technical Information and for
restricting the transfer of the capital stock of or other ownership
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interest in, or any plants which utilize Technical Information of, any member of
Licensee Group, in each case in a form substantially similar to the related
terms of this Agreement. Upon receipt of a request for a license under the
provisions of this paragraph, Xxxxx shall advise Licensee of the royalty which
it deems reasonable for the license of the Technical Information. If Xxxxx and
Licensee are unable to agree upon a reasonable royalty within ninety (90) days
from the date on which such request for a license is received by Xxxxx, the
matter of the determination of a reasonable royalty for the Technical
Information shall be submitted for arbitration in accordance with the terms of
paragraph 16. The cost of such arbitration proceedings shall be shared equally
by Xxxxx and Licensee.
14. (a) This Agreement may be terminated by either party hereto upon any
substantial default of the other party by giving written notice specifying the
default, and such termination shall become effective at the expiration of sixty
(60) days, unless such default is cured within that time or unless the matter
has been referred to arbitration in accordance with paragraph 16 of this
Agreement.
(b) In the event of (i) a termination by Xxxxx under paragraph 12(b)
or 14(a) or (ii) any termination of this Agreement by a trustee, receiver or
similar official in a bankruptcy, receivership or similar proceeding in respect
of any member of Licensee Group, Licensee Group shall not retain any right to
use any Technical Information which Licensee Group is obligated to maintain in
confidence under paragraph 4, and shall cease use of such Technical Information
immediately and Licensee Group agrees to return all Technical Information
materials furnished by Xxxxx (including copies and excerpts therefrom) upon
request of Xxxxx. Except as provided in the foregoing sentence, at the time of
termination of this Agreement, Licensee Group may obtain a license to continue
to use Technical Information, Licensed Patents and Licensed Trade Secrets as
specified in paragraph 13.
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15. Except as otherwise provided in this Agreement, all notices, consents,
requests and other communications required or permitted to be given hereunder
shall be in writing and shall be deemed to have been duly given when delivered
personally or three days after being mailed by registered or certified mail
(return receipt requested) to the parties at the addresses set forth in the
immediately succeeding sentence (or at such other address for a party as shall
be specified by like notice). Notices to Xxxxx shall be addressed to
Xxxxx-Xxxxxxxx Glass Container Inc., Xxx XxxXxxx, Xxxxxx, Xxxx 00000, Attention
of Licensing Manager, and notices to Licensee shall be addressed to Consumers
Packaging Inc., 000 Xxx Xxxx Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxx, Xxxxxx.
16. All disputes or inabilities to agree arising in connection with this
Agreement which cannot be settled by discussion and mutual accord between the
parties at the level of at least Corporate Vice President shall be submitted to
arbitration under the rules of the American Arbitration Association , but no
arbitration proceeding may revoke or revise any provision of this Agreement. The
seat of the arbitration shall be in New York City, New York. Demand for
arbitration shall be made in writing and shall be served upon the party to whom
the demand is addressed by registered mail A mere registered letter will suffice
for valid submission to the arbitration court, an agreement of submission to
arbitration prior thereto not being necessary. Judgment upon the award rendered
may be entered in any court having jurisdiction, or application may be made to
such court for a judicial acceptance of the award and an order of enforcement,
as the case may be.
17. If the performance of this Agreement, or of any obligation hereunder
is prevented, restricted, or interfered with by reason of
(a) Fire, explosion, breakdown or plant failure of machinery,
strike, lockout, labor dispute, casualty or accident, lack of or failure in
whole or in part of transportation facilities,
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epidemic, cyclone, flood, drought, lack of or failure in whole or in part of
sources of supply of labor, raw materials, or power;
(b) War, revolution, civil commotion, acts of public enemies,
blockades or embargo;
(c) Any law, order, proclamation, regulation, ordinance, demand or
requirement of any government or any subdivision, authority or representative of
any such government; or
(d) Any other acts whatsoever, whether similar or dissimilar to
those above enumerated, beyond the reasonable control of a party hereto, the
party so affected, upon giving prompt notice to the other party, shall be
temporarily excluded from such performance to the extent of such prevention,
restriction or interference, except that the party so affected shall use its
best efforts to avoid or remove such causes of nonperformance and shall make up,
continue and complete full performance hereunder with the utmost dispatch
whenever such causes are removed; provided, however, that in the event Xxxxx or
any member of Licensee Group chooses to consent to the entry of a judgment
against it by a United States court of competent jurisdiction or enter into a
consent decree with any governmental instrumentality or authority rather than
incur substantial expenses or great inconvenience, the entry of such judgment or
consent decree shall excuse the consenting party from performance hereunder to
the extent that such judgment or consent decree forbids or restrains such
performance.
18. (a) Nothing herein shall be construed as requiring any member of
either party to disclose to the other party any knowledge or information in
violation of the laws of any country having jurisdiction over such party or in
violation of the rules, regulations, or requirements of any department,
division, or agency of any such country. Nothing in this Agreement shall
authorize the
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disclosure of classified security information, material, or know-how of the
government of the United States.
(b) Licensee Group agrees, with respect to any Technical Information
that it receives from Xxxxx hereunder, not to transmit such data to any third
party, and not to sell products produced by the use of such data to any third
party, when such transmission or sale would be in violation of any laws or
regulations of the United States, including, but not being limited to,
regulations of the United States Department of Commerce regarding the export of
technical data and the direct products thereof.
19. Whenever this Agreement requires that a representative or
representatives of either party to this Agreement meet with a representative or
representatives of the other party to this Agreement, each such party shall use
its best efforts to accommodate any reasonable request from the other party
regarding the identity or qualifications of the representative or
representatives of such party.
20. This Agreement shall supersede (i) the terms of any other license or
similar agreement between Xxxxx and Licensee and any other license or similar
agreement between Xxxxx and any person in respect of the Licensed Territory
which is or becomes a member of Licensee Group, including the agreement entitled
Limited License Agreement between Xxxxx-Xxxxxxxx Glass Container Inc. and
Consumers Packaging Inc. of June 2, 1995, and (ii) the terms of any license or
similar agreement between Xxxxx and Container Holdings Corp., Anchor Glass
Container Corp. and any subsidiary or affiliate thereof in respect of any and
all assets transferred to Licensee by or from any such person, including the
Technical Assistance and Licensing Agreement between Xxxxx and Container
Holdings Corp. dated August 9, 1989.
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21. Notwithstanding anything to the contrary contained in this Agreement,
none of Xxxx X. Xxxxxxxx ("Ghaznavi"), any Affiliates of Ghaznavi or any member
of Licensee Group will, without Xxxxx' consent which shall not be unreasonably
withheld, (i) issue or transfer a majority of the capital stock or other
ownership interest or (ii) otherwise directly or indirectly effect a change in
control in any member of Licensee Group to any Customer or Manufacturer other
than, in each case, to any other member of Licensee Group. Notwithstanding
anything to the contrary contained in this Agreement, no member of Licensee
Group shall sell or otherwise transfer any plant owned or operated by any member
of Licensee Group which utilizes Technical Information (including Licensed Trade
Secrets or Licensed Patents) to any Customer or Manufacturer, other than to any
other member of Licensee Group. Xxxxx will, not later than ten days after
written request by Licensee, confirm to Licensee whether or not Xxxxx considers
a person identified by Licensee to be a Customer or Manufacturer. For purposes
of the foregoing, it is expressly understood that it shall not be unreasonable
for Xxxxx to withhold its consent to a transfer hereunder to a Manufacturer that
is a significant competitor of Xxxxx, any of its affiliates or licensees. This
provision shall not apply to the transfer of the capital stock or other
ownership interest of any member of the Licensee Group (other than the entity to
be formed by Licensee, or any successor or subsidiary of that entity, that will
or does assume Licensee's obligation under the Asset Purchase Agreement dated as
of December 18, 1996, between Anchor Glass Container Corp., Xxxxx and Licensee
("New Anchor")), or any plant owned or operated by any member of the Licensee
Group (other than New Anchor), which does not utilize Technical Information in
any equipment or machinery (such as furnaces, refiners, forehearths, electric
boosts, feeding and delivery systems, forming machines, inspection equipment,
and the like) that is purchased, installed or designed subsequent to the
Effective Date.
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22. Licensee will give Xxxxx not less than thirty (30) days' prior written
notice of any transfer permissible under paragraph 21 of this Agreement.
Promptly after receipt of such notice Xxxxx will offer to enter into a technical
assistance and license agreement with such transferee with terms substantially
similar to the terms of this Agreement including, without limitation, paragraphs
4, 13, 14, 21 , and 22. The amount of the royalty payment shall be reasonably
agreed by negotiation between Xxxxx and such transferee. In the event Xxxxx and
such transferee do not promptly agree as to the amount of the royalty, the
determination of a reasonably royalty shall be submitted for arbitration in
accordance with paragraph 16, provided that the royalty rate shall in any event
not be less than the royalty rate specified in paragraph 6. Any such transfer
shall not be consummated prior to the time Xxxxx and such transferee have
entered into such technical assistance and license agreement, unless Xxxxx has
failed to comply with the provisions of this paragraph.
23. This Agreement shall be construed according to and governed by the
laws of the State of Ohio.
24. This Agreement can only be amended in writing by duly authorized
officers of the respective parties, and shall be binding upon the successors of
Licensee and the successors and assigns of Xxxxx, but in that it involves
personal technical services of the parties hereto shall not be assignable by
Xxxxx or any member of Licensee Group, except any member of Licensee Group may
assign a security interest in this Agreement to any bank or other financial
institution and except as otherwise expressly provided herein, without the prior
written consent of the other party.
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CONSUMERS PACKAGING INC. XXXXX-XXXXXXXX GLASS CONTAINER INC.
By: /s/ Xxxx X. Xxxxxxxx By: /s/illegible
---------------------------- ----------------------------
Title: Chairman Title: Vice President
------------------------ ------------------------
Date 12/18/96 Date 12/18/96
-------------------------- --------------------------
As to Paragraph 21:
XXXX X. XXXXXXXX
/s/ Xxxx X. Xxxxxxxx
-------------------------------
G&G INVESTMENTS, INC.
By /s/ Xxxx X. Xxxxxxxx
----------------------------
Title Chairman
------------------------
Date 12/18/96
--------------------------
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ATTACHMENT 1
In consideration for the right to receive the benefits of a member of the
Licensee Group under the Technical Assistance and Licensee Agreement between
Xxxxx-Xxxxxxxx Glass Container Inc. and Consumers Packaging Inc., Glenshaw Glass
Company hereby agrees to accept the obligations as a member of the Licensee
Group as set forth in such Technical Assistance and License Agreement.
CONSUMERS PACKAGING INC. LICENSEE GROUP MEMBER
By: /s/ Xxxx X. Xxxxxxxx By: /s/ Xxxx X. Xxxxxxxx
---------------------------- ----------------------------
Title: Chairman Title: Chairman
------------------------ ------------------------
Date: 12/18/96 Date: 12/18/96
-------------------------- --------------------------
XXXXX-XXXXXXXX GLASS CONTAINER INC.
By: /s/illegible
----------------------------
Title: Vice President
------------------------
Date: 12 December 1996
--------------------------
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ATTACHMENT 1
In consideration for the right to receive the benefits of a member of the
Licensee Group under the Technical Assistance and Licensee Agreement between
Xxxxx-Xxxxxxxx Glass Container Inc. and Consumers Packaging Inc., Hillsboro
Glass Company hereby agrees to accept the obligations as a member of the
Licensee Group as set forth in such Technical Assistance and License Agreement.
CONSUMERS PACKAGING INC. LICENSEE GROUP MEMBER
By: /s/ Xxxx X. Xxxxxxxx By: /s/ Xxxx X. Xxxxxxxx
---------------------------- ----------------------------
Title: Chairman Title: Chairman
------------------------ ------------------------
Date: 12/18/96 Date: 12/18/96
-------------------------- --------------------------
XXXXX-XXXXXXXX GLASS CONTAINER INC.
By: /s/illegible
----------------------------
Title: Vice President
------------------------
Date: 18 December 1996
--------------------------
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ATTACHMENT 2
Licensee Group Members
Glenshaw Glass Company
Hillsboro Glass Company
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ATTACHMENT 1
In consideration for the right to receive the benefits of a member of the
Licensee Group under the Technical Assistance and Licensee Agreement between
Xxxxx-Xxxxxxxx Glass Container Inc. and Consumers Packaging Inc., Anchor Glass
Container Corporation hereby agrees to accept the obligations as a member of the
Licensee Group as set forth in such Technical Assistance and License Agreement.
CONSUMERS PACKAGING INC. LICENSEE GROUP MEMBER
By: /s/ Xxxx X. Xxxxxxxx By: /s/ Xxxx X. Xxxxxxxx
---------------------------- ----------------------------
Title: CEO Title: Chairman and CEO
------------------------ ------------------------
Date: February 5, 1997 Date: February 5, 1997
-------------------------- --------------------------
XXXXX-XXXXXXXX GLASS CONTAINER INC.
By: /s/illegible
----------------------------
Title: Vice President
------------------------
Date: February 5, 1997
--------------------------
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