Agreement
drawn up and signed in Beersheba on September 8, 1998
Between: The Association for the Development of International Energy
Projects, association no. 580167419, POB 653, Beersheba,
(hereinafter: the "Association",
of the one part
And Solmecs (Israel) Ltd. P.C. 51-08555D-1, Omer Industrial Park,
Building D3, (hereinafter: the Company"),
of the other part
Whereas the Association possesses applicable ideas and/or technological
and/or scientific knowledge in all matters pertaining to a
technology for the reduction of levels of CO2 emissions into the
atmosphere by means of a deep cooling system, (hereinafter: the "CO2
Technology"), and a technology for the direct conversion of solar
energy into electricity by means of photovoltaic cells,
(hereinafter: the "Conversion Technology"),
Whereas the Association has invested work and budgets in the development of
the above-mentioned technologies, (hereinafter: the "Technologies"),
and it wishes to sell and transfer all its rights thereto to the
Company, and enable the Company to make unlimited commercial use of
the Technologies, all in accordance with the terms of this
agreement,
Whereas the Association has presented to the Company an estimate of its
expenses in respect of each of the two technologies, as set forth in
Appendix A of this contract (hereinafter: the "Expenses"),
Whereas the Company has agreed to purchase from the Association all its
rights to the Technologies, taking into account the Expenses as set
forth above, all in accordance with the terms of this contract,
Wherefore the parties have declared, agreed and stipulated as follows:
1. The preamble to this agreement, including the declarations of the parties
which are included therein, constitutes an integral part thereof.
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2. The Association is selling and transferring to the Company, and the Company
is buying and receiving from the Association, all its rights to the
Technologies from the date of signature of this contract by the two
parties, subject to the fulfillment by the Company of all its obligations
pursuant to this contract.
3. The Company undertakes to pay to the Association, as reimbursement for the
expenses it has incurred in the development of the Technologies, the
following consideration:
a. A one-off payment shall be made in NIS for the CO2 Technology,
equivalent to US$ 30,000 (thirty thousand US dollars), in accordance
with the representative rate which shall be known on the actual date
of payment. This amount shall be paid to the Association in two equal
installments as follows:
(1) First installment of $ 15,000 shall be paid 30 days after
signature of this contract.
(2) Second installment of $ 15,000 shall be paid 30 days from the
date on which the Company records the first profit resulting from
a transaction for the application and/or sale of this technology.
(3) VAT, to be paid by the Company, shall be added to the
aforementioned amounts in accordance with the law, if the
transaction is subject to VAT.
b. A one-off payment shall be made in NIS for the Conversion Technology,
equivalent to US$ 30,000 (thirty thousand US dollars), in accordance
with the representative rate which shall be known on the actual date
of payment. This amount shall be paid to the Association in two equal
installments as follows
(1) First installment of $ 15,000 shall be paid 30 days after
signature of this contract.
(2) Second installment of $ 15,000 shall be paid 30 days from the
date on which the Company records the first profit resulting from
a transaction for the application and/or sale of this technology.
(3) VAT, to be paid by the Company, shall be added to the
aforementioned amounts in accordance with the law, if the
transaction is subject to VAT.
c. In addition to the one-off payment, the Company shall pay to the
Association royalties from sales of developments and/or applications
and/or any products based on either one of the two aforementioned
technologies, which it shall sell and/or hand over in return for a
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consideration in any other manner, at a rate of 0.25% (one quarter of
one percent) of any consideration received (hereinafter: the
"Royalties").
d. Said Royalties shall be paid to the Association by the Company
according to the rate at which it receives the consideration from the
sales and/or transactions which it shall effect in connection with the
Technologies, but, in any event, the Company shall be obliged to
transfer the Royalties within 30 days from the date on which it
receives the consideration which is the basis for these Royalties.
e. Notwithstanding the aforesaid, it is agreed by the parties that the
maximum amount that the Company shall pay to the Association in the
form of royalties shall not exceed US$ 50,000 (fifty thousand US
dollars) for each one of the two above-mentioned technologies.
f. VAT, to be paid by the Company, shall be added to the Royalties in
accordance with the law, if the tax authorities determine that they
are subject to VAT.
4. It is agreed by the parties that, upon transfer of the rights to the
Technologies pursuant to this contact, the Association shall be prevented
from engaging in the implementation and/or application of the Technologies,
and it undertakes to hand over to the Company, shortly after signature of
this contract, all materials in its possession which pertain to the
Technologies.
5. For the removal of doubt, it is clarified that the Association is handing
over solely to the Company all its rights to the Technologies on a
completely exclusive basis, and upon signature of this contract and
fulfillment by the Company of its obligations pursuant thereto, waives any
right whatsoever to the Technologies and to all matters in respect thereof.
6. The Company shall be entitled to handle the rights transferred to it
pursuant to this contract as though it is the sole owner, including
registration of the rights in its name in any place which registers rights
as aforesaid. However, the Company declares that it knows that the
Association has not undertaken and has not even declared in any manner
whatsoever that the Technologies being handed over are copyrights and/or
patents protected in accordance with any kind of law, and/or that its
rights to the Technologies are protected in any manner, and the Company
renounces any argument and/or claim in this matter.
7. Notwithstanding the aforementioned in Section 6 above, the Association
undertakes to assist the Company, to the best of its ability, to register
the rights to the Technologies in its name in any place which engages in
the registration of such rights, provided that all its expenses in this
matter are borne by the Company.
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8. The Company declares that it has inspected the Technologies and the rights
of the Association thereto, and has found them to be satisfactory and
suitable, and it renounces any argument and/or claim with respect to this
matter.
9. It is agreed by the parties that, notwithstanding the aforementioned in
this contract, should the Association enter liquidation proceedings or
cease operations, including reporting to the Registrar of Associations, the
following provisions shall apply:
a. Subject to payment in full of the consideration stipulated in Section
3a and Section 3b above, the Technologies shall be fully and
unconditionally owned by the Company.
b. The Company shall be exempt from payment of the royalties stipulated
in Section 3c above or any other payment to the Association and/or to
whomever may come in its stead, and/or is appointed to conduct the
transaction and/or is appointed to liquidate the Association and/or to
any third party which has purchased and/or received in the form of a
transfer and/or in any other manner, the assets of the Association
and/or its rights and/or its liabilities of any type or kind.
c. The right of the Association and/or of any of the entities listed in
sub-paragraph b. above to restore to its possession and ownership the
rights to the Technologies by virtue of Section 11 below - shall
expire.
10. It is agreed by the parties, that in any event, the Association shall not
be permitted to assign its rights pursuant to this contract, in full or in
part, to any third party, unless with the prior written consent of the
Company, at its exclusive discretion, and without being under any
obligation to consent to said request.
11. It is agreed by the parties that if the Company does not actually begin the
commercial application and implementation of any of the technologies
pursuant to this contract within seven years from date of signature of this
contract, the Association shall be entitled - but not obliged - to restore
to its possession and ownership the rights to said technology, subject to
the reimbursement of all the amounts it received from the Company pursuant
to this contract, at their value in NIS, in accordance with the
representative rate known on the date of reimbursement.
12. The Association undertakes toward the Company that it and/or any of its
employees and/or persons working on its behalf shall not make any use of
the Technologies and/or the information connected thereto, and shall not
transfer this information to any third party, in full and/or in part, and
that it undertakes to have all its employees and/or persons working on its
behalf sign a confidentiality agreement with respect to all the information
acquired by them in connection with these Technologies. Should the
Association violate its obligations according to this clause, the
Association shall pay to the Company compensation which has been agreed and
estimated in advance, without any requirement for proof of
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actual damage, at a rate of fifty percent of the payments actually received
by the Association from the Company, pursuant to this contract, up to the
date on which said violation was discovered (hereinafter: the "Agreed
Compensation"), without derogating from the rights of the Company to bring
suit for full damages in accordance with any law. Notwithstanding the
aforesaid, it is agreed by the parties that the Association shall not be
obliged to pay said Agreed Compensation if it proves that it took all
reasonable steps to prevent a violation, and that the violation was
committed without its consent and/or was contrary to its instructions.
13. Any modification of this agreement shall not be valid unless made in
writing and signed by both parties.
14. Any notice sent by one party to the other shall be considered as having
been received by the second party within 72 hours from dispatch, and if
delivered by hand - upon delivery.
In witness whereof the parties have set their hands:
The Association for the Development of
International
Energy Projects
/s/ [ILLEGIBLE] /s/ X. Xxxxx
---------------- ------------
The Association The Company
Signed: ( - )
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Appendix A - Estimate of the Association's Expenses
a. CO2 Technology
(1) Cost of employing Mr. Xxxxxxx Sachsonov, on the
assumption that he devoted 50% of his work time to this
technology, based on the total cost of his employment
by the Association amounting to NIS 305,408, totaled
NIS 152,704, the equivalent of: $ 42,000
(2) Journeys to Russian in connection with this technology:
$ 6,000
(3) Communications expenses (fax, telephone, etc.) $ 6,000
(4) 20% overhead (for current expenses, management,
structure, $ 14,000 etc.).
(5) Total: $ 68,000
b. Conversion Technology
(1) Cost of employing Xx. Xxxx Xxxxxxxxx, on the assumption
that 60% of his work time was devoted to this
technology, based on the total cost of his employment
by the Association amounting to NIS 365,579, totaled
NIS 219,347, the equivalent of: $ 60,000
(2) Cost of six journeys to Russia in connection with this
technology: $ 9,000
(3) Communications expenses, including fax, post and
telephone: $ 6,000
(4) 20% overhead (current expenses, management, structure,
etc.). $ 15,000
(5) Total: $ 90,000
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