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EXHIBIT 10.12
LICENSE AND SUPPLY AGREEMENT
This LICENSE AND SUPPLY AGREEMENT (this "Agreement"), effective as of
August 6, 1999 (the "Effective Date"), is by and between Symyx Technologies,
Inc., a Delaware corporation with offices at 0000 Xxxxxxx Xxxxxxxxxx, Xxxxx
Xxxxx, Xxxxxxxxxx 00000 ("Symyx"), and Argonaut Technologies, Inc., a Delaware
corporation with offices at 000 Xxxxxxxxxx Xx., Xxx. X, Xxx Xxxxxx, Xxxxxxxxxx
00000 ("Argonaut") (each, a "Party"; together, the "Parties").
BACKGROUND
A. Symyx is engaged in research and development activities in the field
of catalyst research, polymer research and the use of process/reaction
optimization chemistry reactors and screening tools, and has created equipment
and software for use in the discovery and optimization of catalysts, polymers,
electronic and other materials;
B. Symyx has acquired considerable experience and know-how with regard
to the Product (as hereinafter defined) and owns certain patent rights relating
thereto;
C. Argonaut has expertise in the development, manufacture and
distribution of instrumentation and consumables;
D. Symyx is willing to provide Argonaut with a license under the Patent
Rights and Know-How (as hereinafter defined) in order that Argonaut may develop,
produce, market and sell the Products, and Argonaut wishes to acquire such a
license, on the terms and conditions herein; and
E. Argonaut desires to supply Symyx with certain requirements of
Product, and Symyx desires to purchase such Product from Argonaut.
NOW, THEREFORE, in consideration of the foregoing and mutual promises
and covenants contained herein, the parties agree as follows:
1. CONSTRUCTION AND DEFINITIONS
1.1 Construction.
(a) All references in this Agreement to "Articles,"
"Sections" and "Exhibits" refer to the articles, sections and exhibits of this
Agreement.
(b) As used in this Agreement, neutral pronouns and any
variations thereof include the feminine and masculine and all terms used in the
singular include the plural, and vice versa, as the context may require.
(c) The words "hereof", "herein" and "hereunder" and other
words of similar import refer to this Agreement as a whole, as the same may from
time to time be amended or supplemented, and not to any subdivision contained in
this Agreement.
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(d) The word "including" when used herein is not intended
to be exclusive and means "including, without limitation."
1.2 Definitions. As used herein:
(a) "Accessories" means items that are (i) sold for Two
Thousand Five Hundred Dollars ($2,500) or more; (ii) not Consumables; and (iii)
provide enhanced functionality to the Device, but are not required to operate
the Device.
(b) "Affiliate" means, with respect to a Party hereto, a
corporation, company or other entity that is owned or controlled by such Party
by virtue of such Party's direct or indirect ownership or control of more than
fifty percent (50%) of the outstanding shares or securities (representing the
right to vote for the election of directors or other managing authority) of such
corporation, company or other entity, but such corporation, company or other
entity shall be deemed to be an Affiliate only so long as such ownership or
control exists.
(c) "Confidential Information" means any information: (i)
disclosed by one Party (the "Disclosing Party") to the other (the "Receiving
Party") which, if in written, graphic, machine-readable or other tangible form
is marked as "Confidential" or "Proprietary", or which, if disclosed orally or
by demonstration, is identified at the time of initial disclosure as
confidential and reduced to writing and marked "Confidential" within thirty (30)
days of such disclosure; or (ii) which is otherwise deemed to be confidential by
the terms of this Agreement.
(d) "Cost of Goods" means the sum of materials, labor,
overhead, warranty reserve and installation reserve.
(e) "Consumables" means those items that are consumed or
commonly replaced as a result of the routine operation of the Device (e.g., stir
paddles, glass inserts and O-rings).
(f) "Device" means an eight (8) cell parallel pressure
reactor that conforms to the Specifications.
(g) "Gross Margin" means Net Sales minus Cost of Goods.
(h) "Know-How" means certain component drawings, data
sheets, cost estimates, assembly criteria, test data and prototypes and other
information which are owned, controlled or licensable by Symyx and are
reasonably necessary for the development, testing, use, manufacture or sale of
Products. Know-How does not include any inventions included in the Patent
Rights.
(i) "Improvements" means any and all improvements,
additions, enhancements, changes or modifications to the Product or any
component thereof which Argonaut, (whether by invention, assignment, license or
otherwise) develops, conceives, reduces to practice or otherwise develops during
the term of the Agreement, and all intellectual property rights
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relating thereto, including any patent applications and patents worldwide.
(j) "Net Sales" means the gross revenues actually received
by Argonaut or its Affiliates from sales of Products to bona fide independent
third parties or sublicensee less sales, use and excise taxes and less returns,
insurance and shipping charges included in those revenues. If Argonaut or its
Affiliates should offer a discount to a third party on an order that includes
the Device and other Argonaut products, the discount shall be applied evenly to
the entire order. All sales of Products between Argonaut and any of its
Affiliates shall be disregarded for purposes of computing Net Sales.
(k) "Patent Rights" means (i) all US patent applications
claiming inventions that are infringed by the manufacture, use or sale of the
Products, including without limitation, those set forth on Exhibit D, (ii) all
divisions, substitutions, continuations, continuations-in-part applications and
re-issues, re-examinations and extensions of (i) above, (iii) any foreign
counterparts of any of the preceding, and (iv) any patents issuing on any of the
preceding.
(l) "Product" means: (i) Devices; (ii) Accessories; and
(iii) Consumables, each as more fully described on Exhibit B attached hereto.
(m) "Specification" means the specification for the
Product set forth in Exhibit B, as may be amended by written agreement of the
Parties.
(n) "Sublicensee" means any third party to whom Argonaut
has granted the right to distribute the Product.
(o) "Term" has the meaning given to it pursuant to Section
11.1.
(p) "Territory" means all countries in the world.
(q) "Trademark" has the meaning given to it in Section
5.5.
2. LICENSE
2.1 Licenses to Argonaut.
(a) Patent Rights and Know-How.
(i) Subject to the terms and conditions of this
Agreement, Symyx hereby grants Argonaut an exclusive (except as provided in this
Section 2.1), non-transferable, worldwide, royalty-bearing, revocable,
non-sublicensable license during the Term, under the Patent Rights and Know-How,
solely to make, use, sell, offer for sale, import and export Products in the
Territory.
(ii) Notwithstanding Section
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2.1(a)(i), above, nothing in this Agreement shall restrict or prevent Symyx from
making, having made, or using Products or any of the components thereof for
internal use by Symyx for itself or on behalf of third parties.
(b) Trademark. Subject to the terms and conditions of this
Agreement, including those set forth in Section 5.5, Symyx hereby grants
Argonaut a non-exclusive, non-transferable, worldwide, royalty-bearing,
revocable, non-sublicensable license, under the Trademarks, solely to reproduce
the Trademarks for use in connection with the marketing, sale and offer for sale
of Products in the Territory.
(c) All rights in the Patent Rights and Know-How not
expressly granted to Argonaut above are reserved to Symyx.
(d) Enforcement. Symyx shall have the first opportunity in
its sole discretion and without obligation, for initiating contact with,
providing notice to, asserting claims or causes of action against, or initiating
proceedings or lawsuits against a third party known or suspected of infringing
or misappropriating the Patent Rights, Know-How or Trademarks. In the event that
either Party becomes aware of or suspects third-party activities that could
constitute an infringement or misappropriation of the Patent Rights, Know-How or
Trademarks, then such Party shall promptly notify the other Party of such
third-party activities, including identification of the third party and
delineation of the facts relating to such third-party activities. In the event
Symyx fails to take commercially appropriate steps with respect to an
infringement that is likely to have a material adverse effect on the sale of
Products within six (6) months following notice of such infringement, Argonaut
shall have the right to do so at its expense; provided that if Symyx has
commenced negotiations with an alleged infringer of the patent for
discontinuance of such infringement within such six-month period, Symyx shall
have an additional three (3) months to conclude its negotiations before Argonaut
may bring suit for such infringement. The party not enforcing the applicable
Patent Rights shall provide reasonable assistance to the other Party, including
providing access to relevant documents and other evidence and making its
employees available, subject to the enforcing Party's reimbursement of any
out-of-pocket expenses incurred by the non-enforcing Party. Any amounts
recovered by either Party pursuant to this subsection, whether by settlement or
judgment, shall be allocated in the following order: (i) to reimburse the
Parties for their reasonable out-of-pocket expenses in making such recovery
(which amounts shall be allocated pro rata if insufficient to cover the totality
of such expenses); and (ii) the remainder shall be retained by Argonaut, with
such remainder being deemed "Net Sales" of Products for which Argonaut shall pay
Symyx, a royalty under Section 6.1.
2.3 Delivery.
(a) Know-How. Following the Effective Date, Symyx shall
deliver to Argonaut one (1) copy of the documents embodying the Know-How.
(b) Disclaimer of Liability. THE KNOW-HOW PROVIDED
HEREUNDER IS PROVIDED "AS IS" AND SYMYX MAKES NO, AND HEREBY DISCLAIMS EACH AND
EVERY, WARRANTY WITH RESPECT TO THE KNOW-HOW,
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INCLUDING ANY AND ALL WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE AND NON-INFRINGEMENT.
2.3 Restrictions on Material Improvements. All material
Improvements shall be reviewed and approved by the Joint Development Committee
as outlined in Exhibit A.
2.4 License to Improvements and Right to First Negotiation.
Argonaut hereby grants to Symyx a nonexclusive, worldwide, royalty-free, fully
paid, non-transferable, non-sublicensable license, under all Improvements, to
make, and use any product and practice any process utilizing the Improvements
for internal purposes. If Argonaut wishes to grant a license to sell products
under the Improvements to a third party or Symyx wishes to receive such a
license, then following written notice of this fact Argonaut shall offer Symyx a
ninety (90) day period starting from the date of such notice to negotiate with
Argonaut for the right to enter into such an agreement with Argonaut on terms
and conditions approved by Argonaut in its sole discretion. Neither Party shall
have any liability to the other for any failure to reach any agreement;
provided, in the event the parties do not enter into such an agreement, Argonaut
shall not offer to enter into an agreement with any third party on terms more
favorable to such third party than those last offered to Symyx.
2.5 Improvement of Symyx. Any Symyx modification or improvement
to the Patent Rights or Know How licensed to Argonaut made before termination of
this Agreement shall be included in the license without additional charge to
Argonaut. The parties agree to promptly disclose modifications and improvements.
2.6 Right of First Negotiation. If Symyx wishes to enter into a
distribution agreement with a third party for the distribution of new equipment
incorporating the Know-How or Patent Rights used in the Device, then Symyx shall
notify Argonaut of this fact before it notifies any other third party and offer
Argonaut a ninety (90) day period starting from the date of such notice to
negotiate with Symyx for the right to enter into such an agreement with Symyx on
terms and conditions approved by Symyx in its sole discretion. Neither Party
shall have any liability to the other for any failure to reach any agreement;
provided, in the event the parties do not enter into such an agreement, Symyx
shall not offer to enter into a distribution agreement with any third party on
terms more favorable to such third party than those last offered to Argonaut.
3. OWNERSHIP
3.1 Patent Rights, Know-How & Trademarks. Argonaut acknowledges
that, as between the Parties, Symyx owns all right, title and interest in and to
the Specifications, Patent Rights, Know-How and Trademarks.
3.2 Improvements. Symyx acknowledges that, as between the
Parties, Argonaut owns all right, title and interest in and to the Improvements.
4. PRODUCT DEVELOPMENT
4.1 Efforts. Argonaut shall use reasonable efforts to develop the
Product in accordance with the Product Development Plan established by the Joint
Development
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Committee pursuant to Section 4.2 and the time schedules contemplated therein.
Except as otherwise expressly agreed in writing, Argonaut shall bear its own
costs incurred in connection with the development of the Product.
4.2 Joint Development Committee ("JDC"). The parties shall
establish a joint development committee which shall be responsible for reviewing
the Product Development Plan. The JDC shall prepare an initial Product
Development Plan by September 17, 1999.
4.3 Delivery and Testing. Argonaut will deliver to Symyx one (1)
unit of the Product by the date set forth in the Product Development Plan, as
determined by the JDC in writing (the "Prototype"). Following the receipt of the
Prototype, Symyx shall evaluate the Prototype for conformity with the
Specifications as set forth in Product Development Plan. Within (20) business
days after the receipt of the Prototype, Symyx shall provide Argonaut with a
written evaluation of the Prototype.
4.4 Product Specifications and Schedule. The JDC will define the
Final Specifications and Development Schedule as part of the Product Development
Plan. Symyx may terminate the Agreement based on non-conformity of the Prototype
of either the Final Specifications or Development Schedule as set forth in the
Product Development Plan.
5. SALES
5.1 Purchase and Sale to Symyx. Argonaut shall manufacture and
sell to Symyx Products for Symyx's internal research purposes (including
research on behalf of third parties) at a cost of Six Thousand Dollars
($6,000.00) per Product plus Cost of Goods. All such sales shall be pursuant to
Argonaut's standard terms and conditions of sale as set forth in Exhibit E.
5.2 Payment for Product Purchases. Symyx shall pay each invoice
for Products purchased by Symyx within sixty (60) days of the date of such
invoice or the delivery date, whichever is later. All payments due hereunder
shall be made by check or by wire transfer to an account specified by the
receiving party.
5.3 Overdue Payments. Any payments due hereunder which are not
paid within five (5) days of the date such payments are due in accordance with
Section 5.2 shall bear interest at the lesser of one and one-half percent (1.5%)
per month or the maximum rate permitted by law, calculated on the number of days
such payment is delinquent. This Section 5.3 shall in no way limit any other
remedies available to either party.
5.4 Marketing Efforts to Third Parties.
(a) Performance. Argonaut shall use its commercially
reasonable efforts to maximize Product sales in the Territory. For purposes of
this Section 5.4, "reasonable efforts" shall mean at least those efforts made by
Argonaut with respect to its own internally developed products, including those
mutually agreeable equivalent, distribution marketing activities and resources
set forth in Exhibit C.
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(b) Training. Argonaut, its Affiliates and Sublicensees
shall maintain knowledgeable sales and marketing personnel to provide
instructions to customers in the use of the Products.
(c) Service and Support. Argonaut, its Affiliates and
Sublicensees shall be solely responsible for all support and service with
respect to the Product and shall at all times during the Term maintain an
adequate number of trained service technicians to assist its customers with
respect to use and maintenance of the Product.
(d) Advertising and Promotions. Argonaut shall be
responsible for all Product marketing commitments and procedures but upon launch
of commercial sale of the Product, or earlier upon mutual agreement of the
Parties, Argonaut and Symyx shall issue a joint press release regarding the
Product and the Parties' relationship. Argonaut shall list the Products in its
catalogs and make such Products available to its customers. Argonaut shall
engage actively in advertising and promotion of the Products which may take the
form of, but shall not be limited to, magazine advertising, direct mail
promotion, trade show displays, educational seminars and other activities
related to promoting Products and shall present the Product at scientific and
commercial conferences as more fully described in Exhibit C.
(e) Use of Symyx Name and Logo. In furtherance of
Argonaut's marketing obligations hereunder, Symyx grants to Argonaut, during the
term of this Agreement, the non-exclusive, non-transferable, limited right to
use Symyx's name and logo (the "Logo") in connection with marketing and sales of
the Product; provided, however, Argonaut shall comply with Symyx's guidelines
for use of the Logo in every use of the Logo on any product advertising or other
marketing material, or, if any such proposed use does not comply with such
guidelines, Argonaut shall, prior to using the Logo, obtain Symyx's written
consent, which consent Symyx may withhold in its sole discretion. The Logos and
all good will associated therewith, including any intellectual property rights
therein, are the exclusive property of Symyx and all use thereof by Argonaut
shall inure exclusively to the benefit of Symyx. In all events, Symyx may at any
time terminate the right granted in this Section 5.4(e) in its sole discretion.
(f) Net Sales Reports. If requested by Symyx, Argonaut
shall provide to Symyx monthly, Net Sales reports (to be delivered to Symyx no
later than the fifteen (15) days following the end of such month in which the
report is due) setting forth Argonaut's sales of the Devices, Accessories and
Consumables.
(g) Business Obligations. Any and all obligations
associated with Argonaut's business shall remain the sole responsibility of
Argonaut. Any and all sales and other agreements between Argonaut and its
customers are and shall remain Argonaut's exclusive responsibility and shall
have no affect on Argonaut's obligations pursuant to this Agreement.
(h) Foreign Corrupt Practices Act. Argonaut shall comply
with the United States Foreign Corrupt Practices Act.
5.5 Trademarks. Argonaut shall select the trademarks, trade names
and
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trade dresses to be used in connection with the Product, subject to Symyx's
prior approval, such approval not to be unreasonably withheld. All such
trademarks, trade names and trade dresses (the "Trademarks") and all good will
associated therewith shall be and become the exclusive property of Symyx. Symyx
shall bear the reasonable costs of registering and maintaining the Trademarks,
using counsel reasonably acceptable to Symyx. Argonaut shall not adopt any
Trademarks, or other trademark, trade name or trade dress that may be
confusingly similar with the Trademarks. Argonaut shall xxxx all Products with
the Trademarks. Except as set forth in Section 2.1(b), Argonaut shall acquire no
interest or rights in and to any Trademarks. Argonaut shall not remove, modify
or obscure any Trademarks incorporated in, marked on, or fixed to the Product.
6. ROYALTIES TO SYMYX
6.1 Running Royalties. In consideration of the licenses and other
rights granted herein, Argonaut shall pay to Symyx royalties in an amount set
equal to (i) twenty percent (20%) of Net Sales for each Device and Accessory
sold by Argonaut, and (ii) fifty percent (50%) of the Gross Margin earned on all
Consumables sold by Argonaut. Amounts paid by Symyx to Argonaut for the purchase
of any products hereunder shall not be included in Net Sales. Royalties on sales
by Argonaut or its Affiliates to Argonaut's sublicensees shall be calculated
using Argonaut's international list price.
6.2 Royalty Reports. Argonaut shall deliver to Symyx, within
fifteen (15) days after the end of each calendar month during which any Product
is sold, a report setting forth in reasonable detail the calculation of the
royalties payable to Symyx for such calendar quarter, including the Product
sold, the Net Sales thereof.
6.3 Royalty Payments. All royalties earned for the relevant month
due pursuant to Section 6.1 shall be paid to Symyx due Net (sixty) 60 days after
the end of the relevant month.
6.4 Overdue Payments. Any payments due hereunder which are not
paid within five (5) days of the date such payments are due in accordance with
Section 6.3 shall bear interest at the lesser of one and one-half percent (1.5%)
per month or the maximum rate permitted by law, calculated on the number of days
such payment is delinquent. This Section 6.4 shall in no way limit any other
remedies available to either party.
6.5 Books and Records. Argonaut shall maintain accurate books and
records which enable the calculation of royalties payable hereunder to be
verified. Argonaut shall retain the books and records for each calendar month
for one (1) year after the submission of the corresponding report under Section
6.2 hereof. Upon prior notice to Argonaut, independent accountants selected by
Symyx, reasonably acceptable to Argonaut, after entering into a confidentiality
agreement with Argonaut may have access to Argonaut's books and records during
Argonaut's normal business hours at mutually agreed times to conduct a review or
audit once per calendar quarter, for the purpose of verifying the accuracy of
Argonaut's payments and compliance with this Agreement. Any such inspection or
audit shall be at Symyx's expense, however, in the event an inspection reveals
underpayment of ten percent (10%) or more in any audit period, Argonaut shall
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pay the costs of the inspection. Argonaut shall promptly pay to Symyx any
underpayment identified in such an audit which amount is undisputed by Argonaut,
with interest from the date such amount(s) were due at an annual percentage rate
of fifteen percent (15%).
6.6 Possible Readjustment of Royalty. In the event Argonaut
reasonably determines that it is commercially impracticable to sell Products
anywhere in the Territory because, for example and without limitation: (i)
Argonaut's operating profit margins on Products are lower than expected; (ii)
the number of Products sold per year is lower than expected, (iii) a material
investment is needed to provide a competitive and successful Device, (iv)
Argonaut desires to lower prices to increase market penetration, (v) no patent
licensed hereunder with claims covering the Products has issued, or (vi)
payments in royalties, license fees, or otherwise for third party technology are
excessive, then Argonaut will notify Symyx, and the parties agree to discuss for
a period not to exceed thirty (30) days the possibility of adjusting the royalty
rates for Products. It is understood that neither party is obligated to accept
or agree to terms of such royalty readjustment.
7. PRODUCT QUALITY
7.1 Quality Assurance. Argonaut agrees to assure the quality
level of Product through the use of Argonaut's standard quality assurance
program currently maintained for Argonaut's other commercially manufactured
products. During the term of the Agreement, Symyx shall have the right to audit
such quality assurance program, at its expense, during regular business hours.
7.2 Presence at Facility. During the first six (6) months during
which each Product is commercially manufactured for Symyx and thereafter upon
reasonable written notice to Argonaut, Symyx shall have the right to have its
representatives visit, from time to time, each facility at which such Product is
being manufactured, to verify Argonaut's compliance with the Quality Assurance
program outlined in Section 7.1.
8. CONFIDENTIALITY
8.1 Confidential Information and Exclusions. Notwithstanding
Section 1.2(c), Confidential Information shall exclude information that the
Receiving Party can demonstrate: (i) was independently developed by the
Receiving Party without any use of the Disclosing Party's Confidential
Information or by the Receiving Party's employees or other agents (or
independent contractors hired by the Receiving Party) who have not been exposed
to the Disclosing Party's Confidential Information; (ii) becomes known to the
Receiving Party, without restriction, from a source other than the Disclosing
Party without breach of this Agreement and that had a right to disclose it;
(iii) was in the public domain at the time it was disclosed or becomes in the
public domain through no act or omission of the Receiving Party; or (iv) was
rightfully known to the Receiving Party, without restriction, at the time of
disclosure.
8.2 Confidentiality Obligation. The Receiving Party shall treat
as confidential all of the Disclosing Party's Confidential Information and shall
not use such Confidential Information except as expressly permitted under this
Agreement. Without limiting the foregoing, the
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Receiving Party shall use at least the same degree of care which it uses to
prevent the disclosure of its own confidential information of like importance,
but in no event with less than reasonable care, to prevent the disclosure of the
Disclosing Party's Confidential Information.
8.3 Confidentiality of Agreement. Each Party agrees that the
terms and conditions, but not the existence, of this Agreement shall be treated
as the other's Confidential Information and that no reference to the terms and
conditions of this Agreement or to activities pertaining thereto can be made in
any form of public or commercial advertising without the prior written consent
of the other Party; provided, however, that each party may disclose the terms
and conditions of this Agreement: (i) as required by any court or other
governmental body; (ii) as otherwise required by law; (iii) to legal counsel of
the parties; (iv) in connection with the requirements of an initial public
offering or securities filing; (v) in confidence, to accountants, banks, and
financing sources and their advisors; (vi) in confidence, in connection with the
enforcement of this Agreement or rights under this Agreement; (vii) or in
confidence, in connection with a merger or acquisition or proposed merger or
acquisition, or the like.
8.4 Compelled Disclosure. If a Receiving Party believes that it
will be compelled by a court or other authority to disclose Confidential
Information of the Disclosing Party, it shall give the Disclosing Party prompt
notice so that the Disclosing Party may take steps to oppose such disclosure.
8.5 Remedies. Unauthorized use by a Party of the other Party's
Confidential Information will diminish the value of such information. Therefore,
if a Party breaches any of its obligations with respect to confidentiality or
use of Confidential Information hereunder, the other Party shall be entitled to
seek equitable relief to protect its interest therein, including but not limited
to injunctive relief, as well as money damages.
9. INDEMNITY
9.1 Argonaut. Argonaut shall indemnify, defend and hold harmless
Symyx and its directors, officers and employees (each an "Indemnitee") from and
against any and all liabilities, damages, losses, costs or expenses (including
reasonable attorneys' and professional fees and other expenses of litigation
and/or arbitration) (a "Liability") resulting from a claim, suit or proceeding
brought against an Indemnitee, arising from or occurring as a result of (a)
Argonaut's material breach of any representation, warranty or covenant contained
in this Agreement; (b) the design, development, manufacture, sale or other
commercialization of the Product(s) except, in each case, any liability as set
forth in Section 9.2(c); (c) any action arising from or related to Argonaut's
negligence in the manufacture, storage, or handling of the Product(s); and (d)
any non-conformance with the Specifications, except in each case, to the extent
caused by the negligence or willful misconduct of Symyx.
9.2 Symyx. Symyx shall indemnify, defend and hold harmless
Argonaut and its directors, officers and employees (each an "Indemnitee") from
and against any and all liabilities, damages, losses, costs or expenses
(including reasonable attorneys' and professional fees and other expenses of
litigation and/or arbitration) (a "Liability") resulting from a claim, suit or
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proceeding brought against an Indemnitee, arising from or occurring as a result
of (a) Symyx's material breach of any representation, warranty or covenant
contained in this Agreement; (b) Symyx's use of the Products purchased
hereunder; except, in each case, to the extent caused by the negligence or
willful misconduct of Argonaut, or (c) a third party claim that the uses
permitted hereunder of the Specification or Know-How infringes any intellectual
property rights of a third party.
9.3 Procedure. In the event that any Indemnitee intends to claim
indemnification under this Article 11, it shall promptly notify the indemnifying
party in writing of such alleged Liability. The indemnifying party shall have
the sole right to control the defense and settlement thereof. The Indemnitees
shall cooperate with the indemnifying party and its legal representatives in the
investigation of any action, claim or liability covered by this Article 10. The
Indemnitee shall not, except at its own cost, voluntarily make any payment or
incur any expense with respect to any claim or suit without the prior written
consent of the indemnifying party, which the indemnifying party shall not be
required to give.
10. REPRESENTATIONS AND WARRANTIES
10.1 Symyx. Symyx represents and warrants on a continuing basis
that it: (i) has the right to enter this Agreement, is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Delaware, (ii) has the right to grant the rights hereunder, in the manner set
forth in this Agreement, (iii) has the power and authority to execute and
deliver this Agreement and to perform its obligations hereunder, (iv) has by all
necessary corporate action duly and validly authorized the execution and
delivery of this Agreement and the performance of its obligations hereunder, and
(v) has not and will not during the term of this Agreement enter into any
agreement which conflicts with or which will result in any breach of, or
constitute a default under this Agreement, any note, security agreement,
commitment, contract or other agreement, instrument or undertaking to which
Symyx is a party.
10.2 Argonaut. Argonaut represents and warrants on a continuing
basis that it: (i) has the right to enter this Agreement, is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, (ii) has the power and authority, to execute and deliver this
Agreement and to perform its obligations hereunder, (iii) has by all necessary
corporate action duly and validly authorized the execution and delivery of this
Agreement and the performance of its obligations hereunder, and (iv) has not and
will not during the term of this Agreement enter into any agreement which
conflicts with or which will result in any breach of, or constitute a default
under this Agreement, any note, security agreement, commitment, contract or
other agreement, instrument or undertaking to which Argonaut is a party.
10.3 Effect of Representations and Warranties. It is understood
that if the representations and warranties under this Article 10 are not true
and accurate at any time during the term of the Agreement and the nonbreaching
party (i.e., Argonaut or Symyx, as the case may be) incurs any liabilities,
costs or other expenses as a result of such falsity, the breaching party shall
indemnify and hold harmless the other party and its affiliates for any such
liabilities, costs or expenses incurred.
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10.4 Disclaimer of Liability. NEITHER PARTY MAKES AND BOTH
PARTIES HEREBY DISCLAIM ALL WARRANTIES, EXPRESS, IMPLIED, OR STATUTORY,
REGARDING THE PATENT RIGHTS, KNOW-HOW, TRADEMARKS, AND PRODUCTS, INCLUDING ANY
AND ALL WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND
NON-INFRINGEMENT.
10.5 Limitation of Liability. IN NO EVENT SHALL EITHER PARTY BE
LIABLE TO THE OTHER PARTY FOR ANY INCIDENTAL, CONSEQUENTIAL, INDIRECT, OR
SPECIAL DAMAGES ARISING OUT OF OR IN RELATION TO THIS AGREEMENT, EVEN IF SUCH
PARTY HAS BEEN INFORMED OF THE POSSIBILITY OF SUCH DAMAGES. IN NO EVENT SHALL
EITHER PARTY'S ENTIRE LIABILITY ARISING OUT OF OR IN RELATION TO THIS AGREEMENT
OR THE RIGHTS GRANTED HEREUNDER (EXCEPT LIABILITY UNDER ARTICLES 8 AND 9) EXCEED
THE SUMS PAID BY ARGONAUT TO SYMYX PURSUANT TO SECTION 6 IN THE TWELVE (12)
MONTHS PRECEDING THE EVENT GIVING RISE TO SUCH LIABILITY.
11. TERM AND TERMINATION
11.1 Term. This Agreement shall commence on the Effective Date be
in full force in effect until the five (5) year anniversary of the Effective
Date, unless terminated earlier as provided in this Article 11 (such period, the
"Term"). Upon written agreement of the parties prior to the end of the
then-current Term, the Agreement may be extended for additional periods of one
(1) year each; provided, however, that either party may terminate this Agreement
after December 31, 2000, upon six (6) months written notice but not before such
date except as expressly provided for herein.
11.2 Termination for Cause. Either party may, without penalty,
terminate this Agreement or cancel any purchase order or portion thereof
effective upon written notice to the other party in the event the other party
materially breaches this Agreement, including, without limitation, by failing to
deliver conforming Product on the requested delivery dates set forth on Symyx's
purchase orders, and such breach remains uncured for thirty (30) days following
written notice of breach by the nonbreaching party, unless such breach is
incurable in which event termination shall be immediate upon receipt of written
notice.
11.3 Insolvency. Either party may terminate this Agreement,
effective upon written notice to the other party in the event the other party
(i) becomes insolvent, (ii) enters into any composition or arrangement with its
creditors, (iii) resolves to wind up its business, dissolve or liquidate, (iv)
is placed in provisional or final liquidation, (v) is placed in provisional or
final judicial management, or (vi) otherwise ceases to conduct business
generally.
11.4 Effect of Termination or Expiration.
(a) Any right or obligation of a party that has accrued as
of the effective date of any termination or expiration, including without
limitation, obligations to deliver Product and pay amounts owed, shall survive
such termination or expiration.
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(b) In the event of a termination or expiration of this
Agreement, the provisions of this Agreement shall continue to apply to all
purchase orders accepted by Argonaut prior to the effective date of such
termination or expiration.
(c) In the event of default by Argonaut, Symyx may take
any reasonable steps which Symyx deems appropriate and which are authorized by
law or this Agreement to obtain the benefit of its bargain pursuant to this
Agreement in addition to or in lieu of the termination procedure set forth in
this Paragraph.
(d) In the event of any termination of this Agreement by
Symyx under Section 11.2 or, the licenses granted in Section 2.1 shall
terminate.
(e) In the event of a termination or expiration of the
Agreement, Argonaut will provide Symyx with all necessary technical, supply,
economic, and marketing information regarding Products during the six months
prior to the termination date so that Symyx may continue to provide its partners
and customers with Products.
11.5 Survival. Sections 2.2(b), and 12.5 and Articles 9, 10, 13,
and 14 shall survive the termination of this Agreement for any reason.
12. DISPUTE RESOLUTION
12.1 Arbitration. If a dispute arises between the parties
relating to the interpretation or performances of this Agreement or the grounds
for the termination thereof, representatives of the parties with decision-making
authority shall meet to attempt in good faith to negotiate a resolution of the
dispute prior to pursuing other available remedies. If within thirty (30) days
after such meeting the parties have not succeeded in negotiating a resolution of
the dispute, such dispute shall be submitted to final and binding arbitration
under the then current Commercial Arbitration Rules of the American Arbitration
Association ("AAA") by one (1) arbitrator in San Francisco, California. Such
arbitrator shall be selected by the mutual agreement of the parties or, failing
such agreement, shall be selected according to the aforesaid AAA rules. The
arbitrator will be instructed to prepare and deliver a written, reasoned opinion
stating his decision within thirty (30) days of the completion of the
arbitration. Such arbitration shall be concluded within nine (9) months
following the filing of the initial request for arbitration. The parties shall
bear the costs of arbitration equally and shall bear their own expenses,
including professional fees. The decision of the arbitrator shall be final and
non-appealable and may be enforced in any court of competent jurisdiction.
13. MISCELLANEOUS
13.1 Governing Law. THIS AGREEMENT AND ALL ACTS AND TRANSACTIONS
PURSUANT HERETO AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO SHALL BE
GOVERNED, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA, WITHOUT REFERENCE TO RULES OF CONFLICTS OR CHOICE OF LAWS.
13.2 Independent Contractors. The relationship of Argonaut and
Symyx
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established by this Agreement is that of independent contractors, and nothing
contained in the Agreement shall be construed to (i) give either party the power
to direct and control the day-to-day activities of the other, (ii) constitute
the parties as partners, joint venturers, co-owners or otherwise as participants
in a joint or common undertaking, or (iii) allow either party to create or
assume any obligation on behalf of the other party for any purpose whatsoever.
13.3 Compliance with Laws. Argonaut shall perform this Agreement
in compliance with all applicable federal, state and local laws, rules and
regulations. Argonaut shall indemnify Symyx and its distributor and customers
for loss or damage sustained because of Argonaut's noncompliance with any such
law, rule or regulation. Argonaut shall furnish to Symyx any information
requested or required by Symyx during the term of this Agreement or any
extensions hereof to enable Symyx to comply with the requirements of any U.S. or
foreign federal, state and/or government agency.
13.4 No Use of Names. Except as expressly provided herein,
neither party will use the name of the other in its advertising or promotional
materials without the prior written consent of such other party.
13.5 Confidentiality of Agreement. Except as required by law,
Argonaut shall not disclose the contents or any term of this Agreement to any
person or entity without the prior written consent of Symyx.
13.6 No Conflicting Obligations. Argonaut agrees not to engage in
any work or services on its behalf or for any other party which would conflict
with its obligations under this Agreement.
13.7 Patent Marking. Argonaut shall xxxx and have its Affiliates
xxxx all Products they sell or distribute pursuant to this Agreement to provide
notice of issued and pending patent applications having claims that cover the
Product. The form of such marking shall be in accordance with the applicable
statute or regulations in the country or countries of manufacture and sale
thereof.
13.8 Interpretation. The parties hereto acknowledge and agree
that: (i) each party and its counsel reviewed and negotiated the terms and
provisions of this Agreement and have contributed to its revision; (ii) the rule
of construction to the effect that any ambiguities are resolved against the
drafting party shall not be employed in the interpretation of this Agreement;
and (iii) the terms and provisions of this Agreement shall be construed fairly
as to all parties hereto and not in a favor of or against any party, regardless
of which party was generally responsible for the preparation of this Agreement.
13.9 Force Majeure. Neither party shall be held responsible for
any delay or failure in performance hereunder (except for failure to make any
payment due hereunder) caused by strikes, embargoes, unexpected government
requirements, civil or military authorities, acts of God, or by the public enemy
or other similar causes reasonably beyond such party's control and without such
party's fault or negligence.
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13.10 Further Assurances. At any time or from time to time on and
after the Effective Date, a Party shall at the request of the other Party (i)
deliver to such other Party such records, data or other documents consistent
with the provisions of this Agreement, and (ii) execute, and deliver or cause to
be delivered, all such assignments, consents, documents or further instruments
of transfer or license, and (iii) take or cause to be taken all such other
actions, as such other Party may reasonably deem necessary or desirable in order
for such other Party to obtain the full benefits of this Agreement and the
transactions contemplated hereby.
13.11 Notices. Any notice required or permitted by this Agreement
shall be in writing and shall be sent by prepaid registered or certified mail,
return receipt requested, internationally recognized courier or personal
delivery, or by fax with confirming letter mailed under the conditions described
above in each case addressed to the other party at the address shown below or at
such other address for which such party give notice hereunder. Such notice shall
be deemed to have been given when delivered:
If to Symyx: 0000 Xxxxxxx Xxxxxxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Attn:
If to Argonaut: 000 Xxxxxxxxxx Xx., Xxx. X
Xxx Xxxxxx, Xxxxxxxxxx 00000
Attn: Xxx X. Xxxxxx
13.12 Assignment. Argonaut shall not assign this Agreement or any
rights hereunder, directly or indirectly, by operation of law, change of control
or otherwise, without the prior written consent of Symyx. Notwithstanding the
foregoing, Argonaut may assign this Agreement without the consent of Symyx to an
acquirer of all or substantially all of the stock or assets of Argonaut
pertaining to the Agreement. Symyx may assign this Agreement without
restriction. Any permitted assigns or successors hereof shall be bound by all
terms and conditions of this Agreement.
13.13 Severability; Waiver. If any provision(s) of this Agreement
shall be held invalid, illegal or unenforceable by a court of competent
jurisdiction, this Agreement shall continue in full force and effect without
said provision. The failure of a party to enforce any provision of the Agreement
shall not be construed to be a waiver of the right of such party to thereafter
enforce that provision or any other provision or right.
13.14 Entire Agreement. This Agreement together with the Exhibits
hereto represent and constitute the entire agreement between the parties and
supersede all prior agreements and understandings with respect to the matters
covered by this Agreement. This Agreement may only be amended in writing signed
by both parties.
SYMYX TECHNOLOGIES, INC. ARGONAUT TECHNOLOGIES, INC.
By: /s/ XXXXXX XXXXXX By: /s/ XX XXXXXXXX
------------------------------- -------------------------------
Print Name: Xxxxxx Xxxxxx Print Name: Xxxxx X. Xxxxxxx, Ph.D.
Title: CEO Title: President and CEO
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Exhibits: A: Development Plan (Joint Development Committee Plan)
B: Product Description and Specifications
C: Marketing Plan
D: Intellectual Property Rights
E: ARGONAUT'S STANDARD TERMS AND CONDITIONS OF SALE
17
EXHIBIT A
JOINT DEVELOPMENT COMMITTEE
1. A committee will be established as outlined in Section 4.2 of the
Agreement for the purpose of reviewing the development of the product.
The committee will be called the Joint Development Committee and the
operating points are outlined below.
(a) Participants: Argonaut (Xxx Xxxxxx, Xxx Xxxxxx)
Symyx (Xxxxxxx Xxxxx, Xxxx xxx Xxxxx)
(b) Duration of the Committee: The Committee will continue to meet until
three months after commercial shipment of the Product, and then on an
as-needed basis to discuss Improvements and Know-how.
2. Meetings: Bi-weekly, held at Argonaut or Symyx to be determined by the
JDC.
3. Product Development Plan.
The Product Development Plan is targeted for completion of
September 17, 1999
4. Meeting Agenda:
(a) Development Schedule Review. The development schedule will be
reviewed at the meetings and any changes will be noted during the
meetings.
(b) Product Specification Review. The Product Specification and
performance testing will be reviewed at the meetings and any changes
will be noted during the meetings.
(c) Material Improvements. Material Improvements will be reviewed at the
meetings and approved by the committee as outlined in Section 2.3 of the
Agreement.
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EXHIBIT B
PRODUCT DESCRIPTION
PARALLEL PRESSURE REACTOR SYSTEM
1. This product is a bench-top (dry box), parallel pressure reactor system
with reactor temperature and pressure controls, with automated gas
additions. The system will have the ability to automate the controls for
reactor heating, mixing, and pressure. In addition the system will have
the ability to qualitatively measure the rate of gas uptake in each
reactor.
2. List of Key Features and Specifications
13.1 (8) Parallel Reactors
Reactor Working Volume: 5 ml
Stainless Steel Reactors with glass inserts
Independent, Reactor Temperature Control
Independent Reactor Temperature Set-points
Temperature Range: Ambient to 200 C
Temperature Accuracy: +/- 2 C
13.2 Mixing:
Direct Drive Magnetic-Coupled Impeller
Variable Speed per Group of Eight Reactors
Detachable, Disposable Impeller
13.3 Pressure System
Pressure System to 34 Atmospheres (34 ATM)
Individual Reactor Pressure Regulation
Gas Uptake Measurement
Manual Injections
13.4 Controller System
Detachable Membrane Keypad Control Interface
4-Line LCD Display
Integrated Solid State Controller
13.5 Accessories
Reaction Vessel Insert Removal Tool
13.6 Consumables
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Glass Reaction Vessel Insert
Reaction Vessel O-Ring Seal
Reaction Vessel Impeller
13.7 Dimensions
Height: 17-inches
Width: 22-inches
Depth: 16-inches
13.8 Power Requirements
000 - 000 XXX, 000 Xxxxx
13.8 Certifications
Laboratory Product Safety EN61010
Electromagnetic Compliance to European 89/336/EEC EMC Directive
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EXHIBIT C
MARKETING PLAN
1. Argonaut is committed to promoting, selling and supporting the PPR-8
product with the goal of attaining the same level of market penetration
and customer satisfaction that has made us the leading provider of
organic synthesis technology worldwide. To ensure our success, Argonaut
will provide resources for the PPR-8 product in the following areas:
(a) Product Marketing
(b) Marketing Communications
(c) Sales
(d) Application Chemistry
(e) Customer Support
2. Our plans for supporting the PPR-8 product will include (but not limited
to) the following types of activities:
(a) PRODUCT MARKETING:
Reviewing and updating customer needs, defining target markets, refining
product specifications, interfacing with product development and
manufacturing, developing and managing pricing issues, monitoring
customer satisfaction, and providing on-going product marketing support.
(b) MARKETING COMMUNICATIONS:
Developing and executing a product launch plan worldwide; managing the
marketing communication strategy (which includes such things as trade
shows, seminars, advertising, press releases, and web based
communication); creating marketing collateral material; and creating
sales tools for worldwide distribution team.
(c) SALES:
Providing worldwide field marketing and sales activities directed at
target markets to maximize both revenue and market penetration. These
activities include lead qualification, prospecting, customer
presentations and demonstrations, quotations, managing the procurement
process, monitoring customer satisfaction, and growing the usage of the
product within an account to ensure future sales.
(d) APPLICATION CHEMISTRY:
Providing chemistry expertise to marketing, sales and customer support
activities to quickly
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gain credibility and acceptance in the market place. Additional support
will include speaking at technical symposiums to promote the technology;
creating application notes as marketing collateral; educating and
supporting existing field application chemists to further market
coverage; and providing training and support material to ensure customer
satisfaction.
(e) CUSTOMER SUPPORT:
Providing instrument service support through both corporate and field
service organizations worldwide, providing documentation for both
customers and worldwide service organizations to support maintenance and
usage of instrument, and monitoring customer usage and satisfaction to
ensure success.
3. The initial strategy in 1999 will be to:
(a) Quickly get the product launched to ensure market awareness,
(b) Focus on key accounts already identified by both companies for
immediate sales,
(c) Train and build the sales/marketing organizations so we are prepared
for much greater market penetration in the year 2000 and beyond.
4. Our preliminary budget expectations, which includes only those resources
dedicated to the PPR-8 product such as personnel, advertising, marketing
collateral, tradeshows and documentation are:
(a) $225,000 for 1999
(b) $625,000 for the year 2000.
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EXHIBIT D
PATENT RIGHTS
1. Following is a list of filed, pending patent applications:
(a) "Parallel Reactor with Internal Sensing and Method of Using Same" as
directed toward the parallel polymerization reactor and the internal
property/reaction sensing methods.
(b) "Improved Parallel Reactor with Internal Sensing" as directed toward
improvements made in the parallel polymerization reactor, including the
magnetic feed through and the removable stirrer.
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EXHIBIT E
STANDARD TERMS AND CONDITIONS OF SALE
1. PRICE: Quoted prices are valid for 30 days from the date of the quote
unless canceled in writing by Seller. Shipping charges, insurance,
duties and taxes are not included in prices and will be invoiced, if
applicable, as separate items.
2. PACKING AND LOSS OR DAMAGE IN TRANSIT: Equipment will be packed for
shipment in a manner suitable to air or truck. Unless otherwise
indicated on the sales order acknowledgment, all sales are F.O.B.
shipping point and, subject to Paragraph 5, all risk of loss or damage
to equipment in transit is upon Buyer. Payment will be made in
accordance with Paragraph 4 below.
3. TAXES: Buyer is responsible for the ultimate payment of all taxes which
may be assessed or levied on or on the account of materials sold
hereunder to the Buyer whether termed a gross receipts tax, use tax,
property tax, sales tax or otherwise. Where Buyer claims that this
transaction is not subject to any such tax; that Buyer is exempt or that
Seller is not required to collect such tax, Buyer agrees to provide
Seller with any documentation necessary to support such a claim, to
allow Seller to document its decision not to collect such tax(es), and
to indemnify Seller from any subsequent claims that such tax(es) were
due.
4. TERMS OF PAYMENT: Payment terms are net 30 from day of invoicing, not
installation. Seller reserves the right in its sole discretion to
require alternative payment terms, including, without limitation, sight
draft, letter of credit or full or partial payment in advance.
5. INSTALLATION AND SITE PREPARATION: Installation services are included in
the purchase price of the equipment sold hereunder only if expressly so
stated on the face of seller's quote or in Seller's most current price
list. For equipment requiring installation by Seller's service
personnel, it is the responsibility of the Buyer to prepare the site
environmentally and provide the required services, power, water, drain,
air, bottled and compressed gases, permits, licenses, approvals, etc. as
well as whatever is required to uncrate and move the equipment to its
location. The tasks that must be completed by the Buyer prior to Seller
installation are outlined in the Seller's pre-installation manual.
6. DELIVERY DATES: The scheduled shipping date shown on the sales order
acknowledgment is our best estimate of the time the order will be
shipped. Seller may make, and invoice, partial shipments. Seller assumes
no liability for loss, general damages, or special or consequential
damages due to delays.
7. RETURNED GOODS: Credit will not be issued for goods returned without
prior approval. Please call Order Administration for required approval
and return procedures. Returns may be subject to a restocking fee.
Termination: Upon any termination or cancellation of this sales order by
Buyer, either in whole or in part, Buyer agrees to promptly pay
appropriate termination or cancellation charges invoiced by Seller.
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8. WARRANTY: Seller makes the following warranties with respect to the
equipment sold hereunder:
8.1 Hardware products against defects in materials and workmanship for
one year from the original date of invoicing. Seller will use reasonable
efforts to repair or replace in its sole discretion, such defective
hardware at no charge provided that Seller is notified of defects within
the warranty period.
8.2 Software has a limited warranty to the original purchaser that the
media on which the program is distributed and the documentation will be
free from defects in materials and workmanship.
8.3 Seller makes and Buyer receives no other warranty express or implied
and all warranties of merchantability and fitness for a particular
purpose are expressly excluded. Neither party shall have any liability
with respect to its obligations under this agreement for consequential,
exemplary, or incidental damages even if it has been advised of the
possibility of such damages.
8.4 Consumable products or the like are only warranted to conform to the
quantity and content stated on the label at the time of delivery.
9. EXCLUSIONS: This warranty covers normal use. Seller does not warrant and
will not be held responsible for loss or damages resulting from a cause
other than defects in material or workmanship, including damage or loss
caused by:
9.1 neglect, accident, servicing or modification by anyone other than a
qualified service engineer;
9.2 any natural disaster, including earthquake, lighting, flood, or
fire; electrical surges or use of improper power sources;
9.3 failure to perform routine preventative maintenance as specified in
the user operation manual; or
9.4 non-conformance to recommended instrument operation procedure.
10. SOFTWARE LICENSES AND COPYRIGHTED MATERIAL: Seller provides certain
software products by license only. The terms of the license are
available from Seller and are accepted by Buyer on delivery of the
licensed software. Unless otherwise specified, Seller's copyrighted
material (software, firmware and printed documentation) may not be
copied except for archive purposes, to replace a defective copy, or
program error verification by Buyer.
11. AUTHORITY TO EXPORT: All orders accepted for export (and/or re-export)
are subject to: a) issuance of an export (re-export) license by the
United States Government, and b) the Buyer providing Seller with all
documentation necessary for shipment to the destination country.
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12. INDEMNITY: Seller agrees to defend, at its own expense, any suit or
legal proceeding which may be brought against Buyer alleging
infringement by Buyer of any third party's intellectual property rights,
by Buyer's use of the Product sold hereunder for its intended purpose,
provided that Buyer shall give Seller prompt written notice of any
claim, threat, or institution of suit or legal proceeding and provided
that Seller shall then have the sole right to control and conduct the
defense and/or settlement of such claim, threat, suit or legal
proceeding, either in the name of Seller or Buyer or both, and Buyer
shall, at Seller's request and expense, provide relevant information and
reasonable cooperation. Seller shall pay final judgment and all costs
and attorney's fees assessed against Buyer in any such suit or legal
proceeding, provided Buyer has complied with the conditions hereof with
respect to prompt notice and cooperation in connection with such suit or
legal proceeding and given exclusive control thereof to Seller, but
Seller shall not be liable for any attorney's fees or other legal
expenses incurred by Buyer without the knowledge and prior written
consent of Seller. Seller shall also have the right, at its own expense,
to replace the equipment claimed to infringe with equally satisfactory
non-infringing equipment, modify said Product so that it becomes
non-infringing, or remove such equipment and refund the price thereof.
13. The foregoing indemnity fully defines Seller's obligations for patent
infringement. Such obligations to defend and make payment shall
specifically not apply to:
13.1 An infringement claim resulting from additions or changes in or to
the product made by Buyer or any third party or from use in combination
with other equipment, where such claim would not have occurred but for
such addition or combination; or
13.2 An infringement claim which is settled without the consent of
Seller; or
13.3 The total amount of Seller's obligation and liability under this
Section shall not exceed the price paid by Buyer to Seller for the
product held to infringe and in no event will Seller be accountable for
special or consequential damages under this indemnity, such as, for
example, loss of business profits or goodwill.
14. SPECIFICATIONS: Weights and dimension set forth in sales literature are
not guaranteed unless previously certified in writing. Seller may
without affecting the obligations under this sales order, make
insignificant changes to the specification of the product or products
delivered under this sales order from those contained in sales
literature.
15. MISCELLANEOUS: This sales order is made and entered into and shall be
governed by the laws of the State of California.
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