EXHIBIT 10.1
CO-OPERATION AGREEMENT
This Co-Operation, License and Supply Agreement ("Agreement") made as of the
26th day of April, 2002.
by and between
SATCON POWER SYSTEMS CANADA LTD.
having its head office at
000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx, Xxxxxx
X0X 0X0
(hereinafter referred to as "SatCon Canada")
and
HATCH STELTECH LTD.
having its head office at
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxx, Xxxxxx
X0X 0X0
(hereinafter referred to as "Hatch Steltech")
and
SIEMENS AG
DIVISION I&S MP3
having its place of business at
Xxxxxxxxxxxx 00
X-00000 Xxxxxxxx, Xxxxxxx
(hereinafter referred to as "Siemens")
- each singularly hereinafter referred to as "Party" or collectively
"Parties" -
1. DEFINITIONS
1.1 "SPLC(TM)" is the Smart Predictive Line Controller, as defined in Annex 1,
including the documentation necessary for the use of such smart predictive
line controller.
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1.2 "SVC" is a Static Var Compensator that provides bus voltage regulation by
rapid reactive load current compensation by fixed capacitors and inductors
in parallel (or in shunt) with the load.
1.3 "Siemens SVC" is a SVC designed and manufactured by Siemens.
2. SUBJECT OF THE AGREEMENT
2.1 SatCon Canada is the owner of patents that cover the SPLC technology. Hatch
Steltech is the exclusive marketing and sales licensee of the SPLC
technology for AC Electric Arc Furnace applications. Siemens manufactures
the Siemens SVC, which is used in the iron and steel industry. The Parties
hereto intend to co-operate as defined hereinafter in the field of SPLCs
for current control of arc furnaces for the iron and steel industry.
2.2 Both Hatch Steltech and SatCon Canada grant to Siemens the exclusive
worldwide right to market and sell the SPLC to third parties in the iron
and steel industry (hereinafter referred to as "CUSTOMERS") who have an arc
furnace which is equipped with a Siemens SVC or who placed an order or a
letter of intent with Siemens to install a new SVC. In addition, both Hatch
Steltech and SatCon Canada grant to Siemens the nonexclusive worldwide
right to market and sell the SPLC to CUSTOMERS that intend to install a new
SVC.
2.3 If Siemens identifies a CUSTOMER who is interested in the installation of
an SPLC without combining it with a SVC or a Siemens SVC, Siemens shall
inform Hatch Steltech thereof. Upon such information, Hatch Steltech and
Siemens shall decide within reasonable time if they will cooperate to
submit an offer to such CUSTOMER; however, it is expressly understood that
neither Hatch Steltech nor Siemens is obliged to participate in any way in
such cooperation. If Hatch Steltech and Siemens agree to cooperate to
submit an offer, they shall decide which Party will act as a subcontractor
for the other Party and they will agree upon the details of the
subcontractor agreement based on the CUSTOMER'S request for quotation. If
Hatch Steltech and Siemens decide not to cooperate to submit an offer,
Hatch Steltech and/or SatCon Canada are not allowed to submit an offer
alone or with a third party to the CUSTOMER identified by Siemens unless
the third party or Hatch Steltech has identified this CUSTOMER
independently and Hatch Steltech immediately upon identification of the
CUSTOMER by Siemens notifies Siemens in writing and is able to prove such
independent identification and the customer's interest in a SPLC
installation for the same project by written or otherwise reasonably
acceptable evidence. Siemens shall remain entitled to offer its products
and services without the involvement of Hatch Steltech or SatCon Canada.
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2.4 If Siemens offers and sells a SPLC to a CUSTOMER (hereinafter referred to
as "PROJECT") SatCon Canada shall provide the SPLC controls and Hatch
Steltech shall provide the engineering and project management for the
PROJECT to Siemens. The conditions for the provision of the SPLC controls
and performance guarantees have to be discussed and agreed upon among Hatch
Steltech, SatCon Canada and Siemens for each PROJECT based on the CUSTOMERS
request for quotation. The scope of supply for the SPLC controls is
described in Annex 2. It is agreed between the Parties that the price to be
paid by Siemens to Hatch Steltech for one piece of SPLC controls shall be
C$500,000 payable pro rata as Siemens receives payment, however not later
than 60 days following shipment of major components. Hatch Steltech will
consider adapting the price and conditions on a case-by-case basis
according to the requirements of the CUSTOMER or other commercial demands.
2.5 In addition to the SPLC controls Hatch Steltech and SatCon Canada will
provide for a PROJECT, at the request of Siemens, at extra cost on a lump
sum basis:
- surge protection with surge arrestors and resistor - capacitor (RC)
elements;
- electrode regulator panel, control software, and associated manuals
- supervisory flicker control integration and IEC 868 flicker meter
- engineering services
- project & construction management
- on-site-services, such as, but not limited to, commissioning and
start-up - services;
- training;
- translations of the documentation.
In case any of these products and/or services are requested by Siemens,
Hatch Steltech, supported by SatCon Canada, shall make a lump sum proposal
to Siemens for the requested products and/or services in a timely manner
prior to the date the Parties recognize that the overall proposal has to be
submitted to the CUSTOMER.
2.6 Hatch Steltech shall provide Siemens during the term of this Agreement with
the current, non-confidential sales material for the SPLC, including, but
not limited to, CDs, brochures and presentation material, without any cost
to Siemens. Siemens shall have the right to present and distribute these
sales materials to CUSTOMERS.
2.7 Hatch Steltech and Siemens shall endeavor to provide the other Party with
information reasonably required for the purpose of the co-operation and the
PROJECTS envisaged hereunder.
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2.8 Hatch Steltech and SatCon Canada shall have no grounds for any claim (for
example, without limitation, claims for direct, indirect or consequential
damages, cost reimbursement and the like) against Siemens if Siemens does
not market and sell any SPLCs.
3. CONFIDENTIAL INFORMATION
3.1 The Parties agree that they shall use all business and technical
information received from any other Party in connection with this Agreement
and which the other Party expressly states to be confidential or the
confidential nature of which can be assumed on the basis of the
circumstances of its disclosure or its contents (hereinafter referred to as
"Confidential Information"), solely for the purposes for which it was
provided, treat it in the same way as their own business secrets and not
make it available to third parties, unless the Confidential Information in
question:
- is generally available from public sources or in the public domain;
- is received at any time from any third party without a nondisclosure
obligation to the disclosing Party;
- is shown to have been developed independently by the receiving Party
without reliance on the disclosing Party's confidential information or
to have been known to the receiving Party prior to its disclosure by
the disclosing Party;
- must be disclosed to the CUSTOMER or other third parties for the
purpose of performing this Agreement, but only if the CUSTOMER or the
other necessary third parties are or become subject to an equivalent
confidentiality obligation;
- is approved for release by written agreement of the disclosing Party;
- is required to be disclosed by law or the rules of governmental
organization, provided, however, that the compelled Party immediately
notifies the disclosing Party to enable the disclosing Party to
contest the disclosure or seek an appropriate protective order.
3.2 The obligation created by Article 3.1 shall continue for a period of 5
years after receipt of the Confidential Information.
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3.3 Publications of any kind referring to the co-operation hereunder shall
require the prior written approval of the affected Party.
3.4 The Parties hereto shall not be obligated to any remuneration for
disclosure to the other Party of any information under this Agreement and
agree that no warranties of any kind are given with respect to such
information as well as any use thereof. If a receiving Party discloses
Confidential Information to a third party in breach of its obligations
hereunder, the Disclosing Party shall be entitled to claim compensation for
damage suffered due to such disclosure up to a maximum amount of EUR
5,000,000 (five million Euro), which compensation shall be to the exclusion
of any other rights and remedies it may be entitled at law or in equity,
except in cases of intent. However, it is agreed that the Disclosing Party
shall be entitled to injunctive relief if such is necessary to prevent such
breaches of this Agreement.
4. TERM AND TERMINATION
4.1 This Agreement shall become effective upon the date hereof and shall remain
in force and effect for a period of 3 (three) years unless terminated
earlier with a 6 months prior written notice sent to the other two Parties,
which notice may be sent at the earliest 12 months after the date of this
Agreement.
4.2 Any Party may terminate this Agreement in the event that one of the other
two Parties is in breach of a material term of this Agreement and that such
breach is not cured within ten (10) days after written notification of such
breach is received.
4.3 Any Party shall have the right to terminate this Agreement immediately and
without notice
- in the event one of the other Parties has made an assignment for the
benefit of creditors or is insolvent, is the subject of proceedings in
bankruptcy or has ceased to conduct business in the normal course or a
receiver, trustee, referee or similar officer has been appointed to
take charge of all or part of that other Party's assets.
- if there is a change in control of one of the other Parties, which in
the reasonable opinion of the terminating Party, adversely affects
such Party's position, rights or interests.
4.4 The duty of Hatch Steltech and SatCon Canada to provide to Siemens a SPLC
and any other products and/or services for a PROJECT acquired by Siemens
and Siemens' duty to pay for such products and/or services before the
termination of this Agreement shall not be affected by the termination of
this Agreement.
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4.5 The duty of the Parties to hold each Party's Confidential Information in
confidence under the terms of Article 3 hereto and the provisions in
Articles 2.8, 4.4 and 5 hereto shall not be affected by the termination of
this Agreement.
5. ARBITRATION; GOVERNING LAW
5.1 Any claims, differences or disputes arising out of or in connection with
this Agreement (hereinafter referred to as "Dispute"), including any
question regarding its existence, validity, termination or its performance,
or in connection with arrangements regarding the performance of this
Agreement shall be settled by an amicable effort by the Parties. An attempt
to arrive at a settlement shall be deemed to have failed as soon as one
Party so notifies the other Parties in writing.
5.2 If an attempt at settlement has failed, the Dispute shall be finally
settled under the Rules of Arbitration of the International Chamber of
Commerce in Paris (hereinafter referred to as "Rules") by three arbitrators
appointed in accordance with the Rules.
The seat of arbitration shall be Zurich. The procedural law of this place
shall apply where the Rules are silent.
The language to be used in the arbitration proceedings shall be English.
The arbitral award shall be substantiated in writing. The arbitral tribunal
shall also decide on the matter of costs of the arbitration and on the
allocation of expenditure among the respective parties to the arbitration
proceedings.
5.3 This Agreement shall be governed, construed and enforced in accordance with
the substantive laws of Switzerland, without regard to its conflicts-of-law
provisions.
6. GENERAL
6.1 Siemens shall be entitled to exercise all of its rights and duties arising
out of this Agreement by its "Affiliates", except an Affiliate which is
deemed to be a competitor of either of the other two Parties in this
application. "Affiliate" shall mean a company, in which Siemens has a
majority of stock and/or voting rights. If Siemens makes use of such right,
Siemens shall inform the other parties thereof and the Affiliate shall
co-operate with the other parties as stipulated in this Agreement. In such
case, all the rights and obligations of this Agreement, including its
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confidentiality provisions, shall be binding upon the Affiliate and shall
apply accordingly to such co-operation.
6.2 No modification to this Agreement will be binding, unless made in writing
and signed by a duly authorized representative of each Party.
6.3 No Party shall assign its rights under this Agreement to any third party,
without the prior written consent of the other two Parties, and any
attempted assignment without this consent shall be void.
6.4 Any individual provision of this Agreement which is or becomes invalid, or
any omission to provide for any subject matter, shall not affect the
validity of the remaining provisions of this Agreement. In such cases, the
Parties shall seek effective solutions as closely as possible approximating
(in economic effect) to the invalid provisions.
6.5 The language of this Agreement shall be English. Correspondence, technical
and commercial documents as well as any other information relating to this
Agreement shall be in English.
6.6 No Party or any of its respective agents, employees, independent
contractors, or representatives shall:
- be considered an agent, employee or representative of one or both of
the other two Parties for any purpose whatsoever,
- have any authority to make any agreement or commitment for any other
Party, nor to incur any liability or obligation in the other two
Partie's names or on their behalf, or
- represent to third parties that they have any right so to bind the
other one or both Parties hereto.
6.7 Nothing contained in this Agreement shall be construed as creating an
agency, partnership or joint venture relationship among the Parties.
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IN WITNESS WHEREOF, the Parties hereby have caused this Agreement to be executed
by their duly authorized representatives on the dates set forth below.
HATCH STELTECH LTD. SIEMENS AG, DIVISION I&S MP3
Date : MAY 21/02 Date : 30.04.2002
------------------ ----------------
By: /s/ Xxxxx Xxxxxx-Molecey By: /s/ [ILLEGIBLE]
-------------------------- --------------------
By: /s/ Tarif Korabi By: /s/ [ILLEGIBLE]
-------------------------- --------------------
SATCON POWER SYSTEMS
CANADA Ltd.
Date : MAY 17,2002
-------------------
By: /s/ Xxxxxx X. Xxxxx
--------------------------
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------
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ANNEX 1
DESCRIPTION OF THE SPLC
The Smart Predictive Line Controller (SPLC) consists of single or three phase
back-to-back thyristors connected in parallel with an inductive reactor. The
SPLC functions as a fast, dynamically controlled series reactor that uses
predictive software to stabilize the current on an electric arc furnace. The
SPLC reduces flicker by limiting the dynamic short circuit MVA at the electrode
tips of an electric arc furnace (EAF) to the transformer nameplate MVA.
The SPLC provides for a soft start of an EAF at the highest operating furnace
transformer tap. The SPLC limits transformer inrush currents on energization.
The SPLC controls maximize furnace power delivery by minimizing the value of the
controlled reactance during stable arcing operation.
The SPLC is more fully defined and depicted in U.S. Patent 5,991,327 and related
patents and patent applications.
SPLC is a registered trademark of SatCon Power Systems Canada Ltd. and may only
be used under license from SatCon Power Systems Canada Ltd.
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ANNEX 2
SCOPE OF SUPPLY FOR SPLC CONTROLS
The following is the scope of supply to be provided to Siemens by Hatch Steltech
as per Article 2.4 of this Agreement:
1. CONTROL PANEL
- Thyristor gating computer consisting of a digital signal processing (DSP)
board or equivalent
- Industrial rack mount PC
- User Screen
- input current transducers
- fibre optic output transducers
2. SOFTWARE
- DSP board thyristor gating software
- PC set up and diagnostic screens
- Preloaded look up tables
3. MANUAL
- set-up, operating and maintenance manual
This is a stand-alone package which Hatch Steltech would supply to Siemens to
gate the Siemens supplied thyristor stack. Siemens would need to supply the
ancillary controls for monitoring and interlocking and operating the entire
system.
Hatch Steltech will supply enough equipment to run the DSP software and to talk
to it through an interface.
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