EXHIBIT 4.24
JOINT DEVELOPMENT AGREEMENT
This JOINT DEVELOPMENT AGREEMENT (the "Agreement") is made and entered
into effective this 18th day of April, 2001, by and among Xxxxxxx Xxxxxxx Inc.,
a Pennsylvania corporation with offices at 000 Xxxxx Xxxx Xxxxx, Xxxxx, XX 00000
("JM") and Hydrogenics Corporation, a Canadian corporation with offices at 0000
XxXxxxxxxx Xxxx, Xxxxxxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0 ("HYDROGENICS").
WHEREAS, the primary technology relating to JM's fuel processors was
developed by JM's parent company, Xxxxxxx Matthey Public Limited Company
("JMPLC"), and JM is being assisted by JMPLC in technical implementation of this
project;
WHEREAS, Hydrogenics has expertise in the design, development and
manufacture of equipment for testing fuel cells and is adapting components and
subsystems of such equipment for commercial use in integrated fuel cell systems;
and
WHEREAS, the parties anticipate the desirability of a project focusing
on the joint design, development, production and commercialization of an
economical and efficient balance of plant system for JM's fuel processor
reactors (the "Project").
THEREFORE, IN CONSIDERATION of the mutual promises and covenants set
forth herein and other good and valuable consideration, the parties hereto, each
intending to be legally bound hereby, agree as follows:
1. Definitions
As used in this Agreement:
(a) "Background IP Rights" means all IP Rights which are owned or
controlled by a party, and which cover inventions or
technology conceived outside of the Project or prior to the
date of this Agreement and which were not obtained, directly
or indirectly, from the other party hereto or its affiliates.
(b) "Balance of Plant System" means the feed supply equipment,
components and hardware and software controls necessary for
the operation of the Fuel Processor Reactor that meet the
Specifications.
(c) "Design Team" means the personnel appointed by each party to
handle the day-to-day responsibilities of the Project in
accordance with the Development Plan. The Design Team members
are listed on Appendix 4 hereto. Each party may change any of
its members of the Design Team by written notice to the other
party.
(d) "Development Plan" means the actions specified on Appendix 1
hereto.
(e) "Fuel Processor Reactor" means a fuel processor reactor
provided by JM that includes but is not limited to the
following elements: catalytic reformer; carbon monoxide
cleanup subsystem ("Demonox"); heat exchangers to cool (or
heat) the flows internal to the fuel processor; thermocouples
for fuel processor control for distributing coolant flows to
the Demonox, removing/adding heat and sending safety signals;
anode exhaust gas oxidizer; steam generator (integrated with
the anode exhaust gas oxidizer); supports for
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all of the above; and interconnecting tubing/piping between
the above items. Fuel Processor Reactors shall include fuel
processor reactors that utilize both propane and natural gas.
The parties acknowledge that the Fuel Processor Reactor, as it
exists on the date of this Agreement and with any subsequent
modifications thereto or re-designs thereof, shall be excluded
from the definition of Project Technology.
(f) "Fuel Processor System" means a Fuel Processor Reactor that
incorporates a Balance of Plant System that can be integrated
with a fuel cell system or can be operated as a stand-alone
unit, and is designated by the Steering Committee for
commercialization.
(g) "Intellectual Property Rights" or "IP Rights" means
intellectual property rights, including all technical
information, inventions (whether patentable or not), patents
and patent applications therefor, registered designs, design
rights, copyright material, trade and commercial secrets,
technical know-how, owned or controlled by a party, and
Confidential Information, as defined in the NDA, but does not
include trademarks or trade names.
(h) "NDA" means the Confidentiality Agreement, dated December 22,
2000, by and between HYDROGENICS, on its own behalf and on
behalf of those companies worldwide whose voting shares it
owns a controlling interest, and JMPLC, on its own behalf and
on behalf of those companies worldwide whose voting shares it
owns a controlling interest, including JM, attached hereto as
Appendix 2.
(i) "Project Patents" means all patents, regardless of country of
issue, which cover inventions arising from the Project
Technology.
(j) "Project Technology" means all inventions, ideas,
improvements, trade secrets, copyrights and modifications,
used in and directly related to the Project, which were
conceived or first reduced to practice in the course of the
work performed pursuant to this Agreement by employees,
consultants or independent contractors of the parties.
(k) "Specifications" means the specifications for a Balance of
Plant System as specified in Appendix 3 hereto.
(l) "Steering Committee" means the representatives of each company
to oversee the Project. Each party shall have an equal number
of representatives. The Steering Committee is listed on
Appendix 4 hereto. Each party shall the have the right to make
changes in its representatives by written notice to the other
party.
2. CONFIDENTIALITY
(a) Notwithstanding Section 14 of the NDA, except as otherwise
expressly modified herein, the NDA shall apply with equal
force and effect to the sharing of information pursuant to
this Agreement.
(b) In accordance with Section 7 of this Agreement and pursuant to
the NDA, JM and HYDROGENICS agree to share information with
each other relating to the Fuel Processor Reactor and the
Balance of Plant System; provided, however, that no Fuel
Processor Reactors supplied by JM will be opened by
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HYDROGENICS nor will HYDROGENICS allow a third party to do so
unless JM approves in writing.
3. CO-OPERATION
(a) JM and HYDROGENICS will co-operate with each other to achieve
the tasks outlined on the Development Plan.
(b) JM will supply to HYDROGENICS Fuel Processor Reactors for the
parties' use in connection with this Project. The parties will
work together to design and build the Balance of Plant System
and test and evaluate the Fuel Processor System. Each party
will conduct the evaluations and will provide written feedback
to the other party, which evaluations shall include, without
limitation, specific areas of deficiencies in meeting the
Specifications.
(c) JM agrees that for a period of two (2) years from the date a
Fuel Processor System is designated hereunder, it will
purchase from HYDROGENICS all of its requirements for Balance
of Plant Systems for any Fuel Processor Systems developed
hereunder and sold by JM, provided, however, that HYDROGENICS
satisfies reasonable price, delivery, and warranty
specifications agreed to in good faith between the parties,
and HYDROGENICS agrees to supply all of JM's requirements for
the same. The parties will negotiate in good faith a separate
supply agreement for the supply by HYDROGENICS of Balance of
Plant Systems to JM.
(d) HYDROGENICS agrees that for a period of two (2) years from the
date a Fuel Processor System is designated hereunder, it will
purchase from JM all of its requirements for Fuel Processor
Reactors, provided, however, that JM satisfies reasonable
price, delivery, and warranty specifications agreed to in good
faith between the parties, and JM agrees to supply all of
HYDROGENICS' requirements for the same. The parties will
negotiate in good faith a separate supply agreement for the
supply by JM of Fuel Processor Reactors to HYDROGENICS.
4. PROJECT COST SHARING
(a) JM shall supply the Fuel Processor Reactors required for the
Project. Otherwise the parties shall share equally in all
out-of-pocket material costs associated with the Project.
Expenditures in excess of an amount to be determined by the
Steering Committee shall be pre-approved by a majority of the
Steering Committee.
(b) Each party shall bear its own internal costs of participation
in the Project, including, without limitation, the salaries
and travel expenses for its respective personnel.
5. SPECIFICATIONS, EVALUATIONS AND FIELD TESTING
(a) The Specifications shall be established by the Steering
Committee and can be relaxed by the Steering Committee at its
discretion if the Steering Committee determines that there is
substantial compliance with the Specifications such that a
Fuel Processor System may be designated. HYDROGENICS
acknowledges that as of the date of this Agreement, the Fuel
Processor
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Reactors are prototypes and are subject to change, which in
turn may necessitate changes to the Specifications.
(b) In the event that a Fuel Processor System is successfully
integrated with a fuel cell system, and JM decides to do field
trials on such integrated system, HYDROGENICS will provide
reasonable assistance in such endeavor, as requested by JM.
6. WARRANTIES
(a) Balance of Plant Systems incorporated into a Fuel Processor
System will be warrantied by HYDROGENICS to meet the
Specifications.
(b) Fuel Processor Reactors incorporated into a Fuel Processor
System will be warrantied by JM to meet the specifications
therefor.
(c) JM shall not be liable for and HYDROGENICS shall indemnify JM
against any personal injury or property damage or claim,
losses, expenses or judgements, resulting in any way from the
handling, possession or use of the Balance of Plant Systems.
(d) HYDROGENICS shall not be liable for and JM shall indemnify
HYDROGENICS against any personal injury or property damage or
claim, losses, expenses or judgements, resulting in any way
from the handling, possession or use of the Fuel Processor
Reactors.
7. INTELLECTUAL PROPERTY CONDITIONS
(a) The parties shall allocate ownership rights to the Project
Technology arising under this Agreement in accordance with the
following principles:
(i) Each party shall own the IP Rights developed
exclusively by it, provided, however, that JMPLC
shall own the IP Rights developed exclusively by JM.
For greater certainty, all Project Technology made
solely by employees, agents, consultants or
independent contractors of a party (the "inventing
party") shall be the sole property of the inventing
party. The inventing party shall disclose such
Project Technology to the other party and shall
promptly decide, in its sole discretion, whether and
where to file patent applications on inventions
and/or other intellectual property protection, and
shall file such applications at its sole cost;
(ii) All Project Technology made jointly by employees,
agents, consultants or independent contractors of
both parties in the performance of the Project shall
be jointly owned by both parties. The parties shall
attempt, in good faith, to decide whether and where
to file patent applications on such Project
Technology and/or other intellectual property
protection, and shall file and maintain such
applications and the resulting patents and/or other
applications with an equal division of costs;
provided, however, that should a party decide not to
financially participate in the filing of a patent
application, the other party may have such filing
done at its cost if it desires, and the filing party
shall be the owner of the resulting Project Patent(s)
and applications. Where HYDROGENICS and JM jointly
file a patent application(s) claiming IP Rights owned
jointly by the
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parties, the parties agree to cooperate fully with
each other in filing, prosecuting, issuing and
maintaining such patent applications and patents and
agree to equally share all outside legal fees and
expenses associated with the filing, prosecution and
issuance of such patent applications and the
maintenance of such applications and any resulting
patents. Each party shall be solely responsible for
any in house expenditures that it incurs in the
filing, prosecution, issuance and maintenance of such
applications and resulting Project Patents. In the
event that the parties jointly develop a patentable
product or process with respect to any Fuel Processor
System, the parties shall negotiate in good faith a
royalty arrangement whereby each party may share in
the sales by the other party that embody such Project
Patent.
(iii) As used herein, the term "file" shall include one or
more but not necessarily all of preparation, filing,
prosecution, appeal, maintenance, foreign filing,
instituting or defending relevant oppositions and
other actions related to procuring and maintaining
Project Patents.
(iv) In order for each party to derive the agreed upon
value from the Project, each inventing party shall
grant to the other party, a paid-up, non-exclusive,
irrevocable world-wide, royalty-free license to make,
have made, use, have used, sell, offer to sell,
import, have imported, copy, have copied, modify,
make derivative works of and sub-license for any such
purpose, related products under all Project Patents
and Project Technology owned solely by the inventing
party. An inventing party shall also grant to the
other party the right to use any Background IP Rights
in existence as of the termination of this Agreement
to the extent required in order for the other party
to use any Project Patent or Project Technology to
the extent licensed by this Agreement; provided that
JM is not required to grant a license to HYDROGENICS
with respect to the Fuel Processor Reactor.
(b) IP Rights owned by each of the parties that do not result from
this Agreement shall be unaffected by the provisions herein.
(c) Except as set forth in this Agreement, neither party shall
obtain any rights to the other party's Background IP Rights.
(d) HYDROGENICS assumes and shall bear the expense of, and agrees
to indemnify, defend and hold JM harmless from and against,
any and all losses, claims, liabilities and damages (including
costs, expenses and reasonable attorneys' fees) incurred by JM
resulting from actual or alleged infringement of any patents,
copyrights, trademarks, trade secrets or other legally
protected proprietary right, based on HYDROGENICS' performance
under this Agreement.
(e) JM assumes and shall bear the expense of, and agrees to
indemnify, defend and hold HYDROGENICS harmless from and
against, any and all losses, claims, liabilities and damages
(including costs, expenses and reasonable attorneys' fees)
incurred by HYDROGENICS resulting from actual or alleged
infringement of any U.S. or foreign patents, copyrights,
trademarks, trade
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secrets or other legally protected proprietary right, based on
JM's performance under this Agreement.
(f) Each party to this Agreement shall keep the other party
advised of any known infringement and any litigation relative
to such other party's Intellectual Property Rights specified
in this Section 7.
(g) In the event that this Agreement is terminated prior to the
successful completion of the Development Plan, each party will
return to the other any and all property it has received from
the other for use in connection with the Project and the
parties shall discuss in good faith the proper disposition of
any prototype Fuel Processor Systems and components thereof.
Each party shall return or destroy all drawings and
documentation concerning the other party's Confidential
Information.
(h) Except for license rights under Background IP Rights to the
extent necessary for a party to fully use and exploit Project
Patents and Project Technology as provided for above, nothing
in this Agreement shall be deemed to constitute a license or
waiver of existing or future proprietary rights that each
party may otherwise possess.
8. MISCELLANEOUS PROVISIONS
(a) Limitation of Damages. In no event shall either party be
liable to the other party for special, incidental or
consequential damages, whether such other party's claim is
based in contract, negligence, strict liability or otherwise.
(b) Force Majeure. Each party's obligation to perform hereunder
shall be subject to any delays caused by acts of God, fires,
floods, explosion, sabotage, riot, accidents; orders of, or
failure to issue or continue in effect all necessary permits
by, civil or military authorities, delays by suppliers of
fuel, power, raw materials, containers or transportation;
breakage or failure of machines, strikes, lockouts or labor
trouble; perils of the sea; or any other cause beyond such
party's reasonable control. The party invoking this Subsection
8(b) shall give the other party prompt written notice of any
event that is likely to delay its performance hereunder.
(c) Term and Termination.
(i) The term of this Agreement shall be for one (1) year
from the date hereof.
(ii) This Agreement can be terminated by either party:
(A) on account of a material violation of the
Agreement by the other party, which shall
include, without limitation, such party's
consistent failure to perform its
obligations hereunder in a timely manner,
provided, however, that the non-breaching
party shall have provided at least thirty
(30) days' written notice to the other
party; provided further, that such notice
shall be null and void if the offending
party cures the violation before expiration
of the thirty (30) days notice period; or
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(B) when the other party makes a general
assignment for the benefit of its creditors,
has a custodian, receiver or any trustee
appointed for it or a substantial part of
its assets, commences any voluntary
proceeding under any bankruptcy law; or
(C) when a court having jurisdiction over the
other party shall enter a decree or order
for relief in any involuntary case under
applicable bankruptcy law and such decree or
order shall continue unstayed and in effect
for a period of sixty (60) days or more.
(iii) Termination for any reason by either party shall not
prejudice that party's remaining contractual rights
hereunder nor terminate the other party's remaining
obligations hereunder.
(d) Entire Agreement. This Agreement, including the appendices
hereto, which are hereby incorporated herein, constitutes the
entire agreement between the parties. Except to the extent
otherwise provided herein, no modifications to,
supplementation of, or addition of terms or conditions to this
Agreement, whether contained in any purchase order,
confirmation or otherwise, shall be effective unless made in
writing and signed by the party to be charged with
modification.
(e) Governing Law. This Agreement shall be interpreted in
accordance with the laws of the Commonwealth of Pennsylvania
without regard to its principles of conflict of laws.
(f) Assignment. Except as expressly permitted in this Subsection
8(f), no right or obligation of either party hereunder shall
be assignable without the prior written agreement of the other
party, which agreement shall not be withheld unreasonably;
otherwise this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective
permitted successors and assigns. JM may assign rights and
obligations hereunder to JMPLC. This Agreement is entered into
solely for the benefit of the parties named in it and not for
the benefit of any other persons or entities. No other persons
or entities may enforce it for their benefit nor shall they
have any claim or remedy for its breach.
(g) Notices. All notices, requests and other communications
hereunder shall be deposited in the United States mail,
registered or certified, postage prepaid, addressed as
follows:
If to HYDROGENICS:
Hydrogenics Corporation
0000 XxXxxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxx
Xxxxxx X0X 0X0
Attn: Xxxxxxxx Xxxxx, Vice President, Corporate Affairs
If to JM:
Xxxxxxx Xxxxxxx Inc.
000 Xxxxx Xxxx Xxxxx
Xxxxx, XX 00000
Attn: Vice President, Gas Processing Technology
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With a copy to:
Xxxxxxx Matthey Inc.
000 X. Xxxxxxxxxx Xxxx
Xxxxx, XX 00000
Attn: Vice President & General Counsel
It is understood and agreed that this Subsection 8(g) is not
intended to govern the day-to-day business communications
necessary between the parties in performing their duties, in
due course, under the terms of this Agreement.
(h) Waiver. Any delay or forbearance by either party in exercising
any right hereunder shall not be deemed a waiver of that right
or any other right.
(i) Severability. The provisions of this Agreement shall be
severable and, if any provision of this Agreement is held to
be invalid or unenforceable, it shall be construed to have the
broadest interpretation that would make it valid and
enforceable. Invalidity or unenforceability of a provision
shall not affect any other provision of this Agreement.
(j) Survival. Notwithstanding Subsection 8(c)(i), Sections 2, 6,
7, and Subsections 8(a), 8(c)(iii), 8(e), 8(g) and 8(j) shall
indefinitely survive the termination of this Agreement in
accordance with their terms.
(k) Counterparts. This Agreement may be executed in one or more
counterpart copies, each of which shall be deemed an original
and all of which shall together be deemed to constitute one
agreement.
(l) Headings. The headings in this Agreement are for convenience
only and do not in any way limit or amplify the terms or
conditions in this Agreement.
(m) No Joint Venture. Nothing contained in this Agreement shall be
deemed to create a joint venture or partnership between the
parties, nor shall either party or any employee thereof be
deemed to be an agent, employee, joint venturer, business
partner, or legal representative of the other party. Neither
party shall have any authority to incur any liability or
obligation whatsoever on behalf of the other.
(n) Publicity/Press Releases. Except as otherwise may be required
by law, all public notices and all other publicity concerning
the Project shall be approved in advance by a majority of the
Steering Committee.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
HYDROGENICS CORPORATION XXXXXXX MATTHEY INC.
By: /s/ XXXXXXXX XXXXX By: /s/ XXXXXXX X. XXXXXXXX
------------------------- -------------------------
Name: Xxxxxxxx Xxxxx Name: Xxxxxxx X. Xxxxxxxx
Title: VP Corporate Affairs Title: VP Gas Processing Technology
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