Exhibit 10.6
MEMORANDUM OF UNDERSTANDING
Made and entered into as of the 1st day of December, 2001 by and between
OrganiTech USA, Inc. a company incorporated and existing under the laws of
Delaware U.S.A. ("OT") and Agronaut Pte Ltd. a company incorporated and existing
under the laws of Singapore ("Agronaut")
Introduction
A. OT is the exclusive proprietary owner of certain know how, data,
documents, details, materials, trade secrets and other information in the
field of automated, self contained systems for the production of
vegetables and plants, including without limitation all data, documents,
details, materials, know-how, trade secrets, versions, new versions,
improvements, modifications, enhancements, derivative works and/or any
other technical information pertaining and/or relating to United States
Patent #6,243,987 and PCT application, owned by OT's wholly owned
subsidiary, Organitech Ltd., covering various claims for the Company's
"self contained, fully automated, robotic crop production facility,"
referred to as the GrowTECH 2000(TM) (Collectively - the "OT IP").
B. OT is engaged in the research, development, production, operation,
marketing and distribution of an automated, self contained system for the
production of vegetables and plants known as the "GrowTECH 2000" (the "GT
2000").
C. Agronaut is engaged in the field of Agro-Technologies systems in Singapore
and other Asian countries.
D. The parties wish to join efforts and mutually cooperate in the assembly of
parts of the GT 2000 systems in Singapore as well as in the research,
development, production, operation, marketing and distribution of
additional automated, self contained systems for the production of
vegetables, plants, medicines, food supplements and other R&D projects
(the "Agro-Technologies Field").
E. For this purpose the parties wish to establish and incorporate a
Singaporean company which, subject to obtaining sufficient government
and/or private funding, will be engaged in the Agro-Technologies Field
under the name of OrganiTech Asia, or any other name to be agreed upon
between the parties (the "Company").
F. The parties acknowledge that the operation of the Company in the
Agro-Technologies Field shall require substantial funding and obtaining
such required funding constitutes a condition precedent to its operations
and to the parties obligations with respect thereof.
G. The parties wish to provide for the principles, terms and conditions
agreed between them regarding their cooperation and the Company, as herein
detailed.
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NOW THEREFORE the parties have agreed as follows:
1. Term
The term of this MOU is for a period of 12 months commencing on the
signature date hereof (the "Term").
2. The Company
2.1. As soon as practicable the parties will establish and incorporate the
Company which will be engaged in the Agro-Technologies Field under
the name of OrganiTech Asia or under any similar name to be approved
by the Singapore Registry of Companies and Businesses and agreed upon
by the parties.
2.2. The Company will be established with an authorized share capital of
S$100,000 (Singapore Dollars One Hundred Thousand Only) comprised of
100,000 ordinary shares of S$1 par value each and with an initial
issued and outstanding share capital of 100 ordinary shares of S$1
par value each of which OT shall hold 50% and Agronaut 50%.
2.3. The Company shall be jointly managed and all resolutions regarding
the management of the Company, in the ordinary course of business,
will be adopted by the Company's Board of Directors (which shall
comprise of 5 directors, 3 to be appointed by OT and 2 by Agronaut)
based on a simple majority of votes.
3. Funding
3.1. Initial Funding
Upon the incorporation of the Company, Agronaut shall extend to the
Company a loan in the amount of One Hundred Thousand (US$100,000) US
Dollars. Such loan monies shall be utilized to finance the Company's
initial operations (the "Agronaut Loan"). The Agronaut Loan shall
bear no interest and shall be repaid by the Company (in US$) from the
Company's first profits or upon any additional funding to be obtained
by the Company from governmental or private sources.
3.2. Substantial Funding
3.2.1. Agronaut hereby further agrees to use its best efforts to
obtain for the Company an additional funding of at least one
million ($1,000,000) US Dollars (the "Substantial Funding")
by the end of this MOU Term.
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3.2.2. It is hereby agreed between the Parties that should Agronaut
fail to obtain the Substantial Funding by the end of the
Term, this MOU and each of the parties' respective duties
and obligations provided for herein shall terminate and
become null and void. In such a case the Company shall be
dissolved by the parties by mutual consent.
4. The Company's Operations
It is contemplated between the parties that to the extent the Company
shall obtain the Substantial Funding the Company shall engage in any of
the following operations, as shall be discussed and agreed between the
parties and the Company in detail under the Detailed Agreements provided
for below:
4.1. The Company shall establish an assembly plant or a manufacturing
facility through out sourced sub-contractors for the assembly of the
GT 2000 systems as a sub-contractor for OT, however, for the
avoidance of any doubt, it is clarified that the Company shall not
engage in the sale or distribution of the GT 2000 systems under any
circumstances;
4.2. The Company shall engage in the research, development production,
marketing and distribution of additional automated, self contained
systems for the production of vegetables, plants, medicines, food
supplements and other products (other than the GT 2000, which the
Company may only assemble as a sub contractor for OT), as shall be
specifically agreed between the parties from time to time, however,
for the avoidance of any doubt, it is clarified that the Company
shall not engage any activity whatsoever, including without
limitation the development of systems or machines or technology,
which competes with OT or any OT products or systems, unless
expressly agreed between the parties in writing.
For the purpose of facilitating the Company's operations OT shall grant the
Company a license to exploit the OT IP (as herein defined), under terms and
conditions to be discussed and agreed upon between the parties and the Company
under the Detailed Agreements provided for below.
5. Proprietary Rights
5.1. It is hereby specifically agreed and acknowledged by both parties
that all of the proprietary rights and copyrights in the intellectual
property developed by the Company shall belong exclusively to the
Company and any party (including, without limitation, the parties
hereto) wishing to make any use or to exploit any such intellectual
property shall be required to obtain a license from the Company under
terms and conditions to be agreed between the Company and such party.
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5.2. It is hereby specifically agreed and acknowledged by Agronaut that
all of the proprietary rights and copyrights in the OT IP and the GT
2000, and any related documentation and data thereto, independently
developed by OT, either before or after the date of this Agreement,
are owned by and belong solely and exclusively to OT, and that
neither Agronaut nor the Company ever had, do not have, and will not
claim to have any such proprietary right or copyright or any other
rights whatsoever in respect of the XX XX, XxxxXXXX 0000 and/or
related technology and/or documentation except the rights granted
them hereunder.
5.3. Agronaut hereby undertakes not to assert, contest or dispute the
validity of, or contest Organitech's ownership of any patents,
copyrights, trademarks, trade names, whether registered or not or any
other registration thereof, or other proprietary right of OT.
6. Confidentiality
Each of the parties hereto covenants and undertakes that throughout the
Term of this MOU and for a period of three years thereafter, it will hold
in strict confidence all documents and information concerning Organitech's
IP and business, financial and/or commercial information, operations,
sales, marketing, customers, suppliers, Agronaut's business, financial
and/or commercial information, operations, sales, marketing, customers,
suppliers the Company, the Company's IP, its business, financial and/or
commercial information, operations, sales, marketing, customers, suppliers
and all information pertaining to any intellectual property rights of
Organitech and/or the Company and any other proprietary information of
Organitech and/or the Company (all hereinafter referred to as the
"Confidential Information"), by taking all reasonable measures to maintain
the confidentiality of such Confidential Information, which will in no
event be less than the measures they use to maintain the confidentiality
of their own information of similar importance. Each of the parties also
covenants and undertakes, not to use the Confidential Information in any
way, directly or indirectly, for purposes other than for the Company
and/or for fulfilling its obligations and exercising its rights under this
MOU. A party may disclose such Confidential Information, to its officers,
directors, consultants, counsel and their representatives, only on a need
to know basis, under confidentiality obligation, and in connection with
the transactions contemplated by this MOU.
For the purpose hereof the term "parties" shall include also each party's
directors, employees, consultants, contractors, and any such other persons
who are permitted access to the Confidential Information.
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7. Detailed Agreements
The parties hereby agree that upon obtaining the Substantial Funding (and
provided that such Substantial Funding shall be obtained within the Term
of this MOU), the parties shall enter into detailed agreements
(hereinafter the "Detailed Agreements") which shall provide for all of
their respective rights, duties and obligations, the specific terms of the
license to the Company to use the OT IP and the operations and management
of the Company. For the avoidance of any doubt it is hereby clarified that
this MOU and all of the parties' respective rights, duties and obligations
thereunder (other than the provisions of Section 6 above which shall
survive the Term of this MOU) shall terminate upon the end of its Term
whether such Detailed Agreements shall be signed between the parties (and
the Company) or not.
8. General Terms and Conditions
8.1. The Parties relationships hereunder, will be exclusively governed by,
and will be construed exclusively in accordance with the laws of the
Republic of Singapore. The exclusive jurisdiction with respect to
any dispute whatsoever arising between the parties with respect to
the existence, interpretation, construction, execution or
implementation of the provisions of this MOU, shall be vested with
the competent court of the Republic of Singapore.
8.2. This Agreement together with its Schedules, contains the entire
understanding and agreement among the Parties, and supersedes any
prior understandings or agreements between or among any of them, with
respect to the subject matter hereof.
8.3. No change, addition or modification of this Agreement will be valid
unless made in writing and signed by all Parties hereto.
8.4. All notices to be given hereunder will be in writing and delivered to
the Parties' addresses specified above, or to such other address as
shall be furnished in accordance with the provisions hereof by either
Party to the other Parties hereto. Each such notice shall be deemed
to have been received if personally delivered - upon delivery; if
mailed by certified mail, return receipt requested - five business
days after dispatch (or ten business days, if sent internationally);
if sent by facsimile - upon receipt of the fax in complete, readable
form.
8.5. Neither party may assign or otherwise transfer its rights and
obligations or any part thereof under this Agreement to any company,
person or party at any time whatsoever without the other's party
prior written consent.
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8.6. This Agreement does not make either party the employee, partner,
joint venture, agent or legal representative of the other for any
purpose whatsoever. Neither party is granted any right or authority
to assume or to create any obligation or responsibility, express or
implied, on behalf of or in the name of the other party except as
granted herein. In fulfilling its obligations pursuant to this
Agreement each party shall be acting as an independent contractor.
8.7. The Agreement is in the English language only, which language shall
control in all respects. No translation, if any, of this Agreement
into any other language shall be of any force or effect in the
interpretation of this Agreement or in a determination of the intent
of either party hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year
hereinabove first set forth.
/s/ Xxxx Xxxxxx /s/ Xxxxx Xxx
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OrganiTech USA, Inc. Argonaut Pte Ltd.
Xxxx Xxxxxx Xxxxx Xxx
December 1, 2001 December 1, 2001
