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EXHIBIT 10.3
TECHNICAL INFORMATION, TRADEMARK
AND PATENT LICENSE AGREEMENT
Technical Information, Trademark and Patent License Agreement dated March
27, 1995 ("Effective Date") by and between Engelhard/ICC, a partnership
organized and existing under the laws of the Commonwealth of Pennsylvania,
United States of America, (hereinafter referred to as "E/ICC") and Xxxxx-Xxxx
Electric & Machinery Manufacturing Corporation, a corporation organized and
existing under the laws of the Republic of China (hereinafter referred to as
"CHEM").
WITNESSETH:
WHEREAS, E/ICC owns certain patents, and technical information and
know-how associated with the design, manufacture and application of the System
(defined below);
WHEREAS, CHEM desires to obtain licenses under such patents and technical
information and know-how of E/ICC to manufacture and market the System and to
design, manufacture and market the CHEM System (defined below) in the Republic
of China and other areas as provided in this Agreement under license from
E/ICC, and with technological assistance extended by E/ICC; and
WHEREAS, E/ICC is willing to license such patents and technical
information and know-how and provide such technical assistance, all in
accordance with the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained and other good and valuable
consideration, the parties hereby agree as follows:
Article 1. Definitions
1.1 As used in this Agreement, the following terms shall have the
meanings as set forth herein:
(a) "E/ICC's System Patents" shall mean System related patents now
in the possession of E/ICC or those acquired during the term of this Agreement
which rely on E/ICC's System Technical Information and Know-How. E/ICC's
System Patents now in existence are listed in Schedule "A" attached hereto.
(b) "E/ICC's System Technical Information and Know-How" shall mean
System related technology developed by and belonging to E/ICC or such
technology that may be developed during the term of this Agreement. The
contents of E/ICC's System Technical Information and Know-How which is now in
existence as of the Effective
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Date shall be set forth separately by E/ICC in Schedule "B" attached hereto.
(c) "Sales Price" shall mean ninety-two percent (92%) of CHEM's
gross invoice price for Systems produced under this Agreement.
(d) "Supply Agreement" shall mean the Agreement dated March 27,
1995 between the parties hereto which relates to the purchase by CHEM of
certain products from E/ICC, as the same may be amended from time to time
pursuant to the terms thereof.
(e) "Rotor Products" shall mean any and all rotors or cassettes
which include a desiccant or drying material or agent or that is capable of
use for heat exchange or any other purpose that is used or to be used in any
heating/air-conditioning/treatment system.
(f) "Ancillary Products" shall mean additional ancillary
components, full systems or sub-systems that may also be purchased at the
request of CHEM.
(g) "E/ICC's Sales Price" shall mean ninety-two percent (92%) of
E/ICC's gross invoice price for Systems or CHEM Systems produced under this
Agreement;
(h) "System" shall mean a desiccant air-conditioning product
designed and developed solely by E/ICC which may include a Window Product
(defined below) which incorporates E/ICC components, including Rotor Products
and Ancillary Products and technology or know-how for which E/ICC is free to
grant licenses without accounting to any third party.
(i) "Window Products" shall mean air-conditioning,
dehumidification, heat exchange or air treatment products which incorporate
Rotor Products that can be installed in a window size opening or are of a size
rating of three (3) refrigerated tons (U.S.) or smaller.
(j) "CHEM Systems" shall mean any product which utilizes E/ICC's
System Patents and E/ICC's System Technical Information and Know-How or which
contains Rotor Products which is first designed and developed solely by CHEM,
which may include a Window Product.
(k) "Territory shall mean all of the countries of the world except
for Israel, Turkey, Greece, Egypt and Cyprus.
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Article 2. Disclosure and Technical Assistance
2.1 Subject to the provisions of Paragraph 4.1, E/ICC agrees that on the
Effective Date or as soon thereafter as is reasonable under the circumstances,
E/ICC shall disclose to CHEM E/ICC's System Technical Information and Know-How
and E/ICC's System Patents in existence on the Effective Date.
2.2 From time to time during the term of this Agreement, E/ICC and CHEM
shall have a regular exchange of experience and information and E/ICC shall
disclose to CHEM E/ICC's System Technical Information and Know-How and E/ICC's
System Patents owned, developed or acquired by E/ICC after the Effective Date.
2.3 E/ICC shall make available to CHEM technically qualified trained
employee(s) familiar with E/ICC's System Technical Information and Know-How
whose purpose and obligation shall be to advise CHEM's personnel in the
design, manufacture, application, use and sale of Systems which employ E/ICC's
System Technical Information and Know-How. For the first year following the
Effective Date, E/ICC will provide up to one thousand (1000) hours of
technically qualified trained employee(s), and for the second year following
the Effective Date, up to five hundred (500) hours of technically qualified
trained employee(s), to make available to CHEM at mutually agreeable times and
places, which may include the Republic of China when requested in writing by
CHEM, and will also include Philadelphia, Pennsylvania, U.S.A. and by phone
conference and video conference with CHEM, when available. Payment for
salaries and expenses for E/ICC technically trained employees up to the above
hourly limits, will be borne by E/ICC. In the event that CHEM personnel visit
the U.S., all salaries and expenses for CHEM personnel will be borne by CHEM.
In each case, the hosting party will assist the visiting party in making
economical travel arrangements.
2.4 Any information which E/ICC shall disclose to CHEM shall be in
English.
Article 3. Licenses
3.1 (a) Subject to the provisions of Article 4, E/ICC hereby grants and
agrees to grant to CHEM:
(i) an exclusive [as limited in paragraph 3.1(b)],
non-transferable license without the right to sublicense under
E/ICC's System Patents and E/ICC's System Technical Information
and Know-How to manufacture and sell Systems and to design,
manufacture and sell CHEM Systems in the Republic of China;
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(ii) a non-exclusive, non-transferable license without the
right to sublicense under E/ICC's System Patents and E/ICC's
System Technical Information and Know-How to manufacture and
sell Systems and to design, manufacture and sell CHEM Systems
in the People's Republic of China.
(b) CHEM's initial period of exclusivity under Paragraph 3.1(a)(i)
is for three (3) years commencing with the Effective Date. For the first three
(3) years, the parties agree to establish a yearly business process to review
actual performance against performance guidelines shown in Schedule "C." The
parties will work together in this process to make recommendations for both
manufacturing, marketing and pricing to ensure the performance of the
desiccant business. At the end of year three (3), E/ICC and CHEM will meet and
mutually determine firm performance targets for years four (4) and five (5).
After year four (4), if CHEM has not achieved the firm performance targets,
except as caused by force majeure, E/ICC shall have the right to convert
CHEM's license from exclusive to non-exclusive based on the running royalty
described in Article 4.
(c) It is understood that the license-granted or to be granted
pursuant to Paragraphs 3.1(a) will not include or imply: (1) any license to
manufacture Systems outside of Republic of China or The People's Republic of
China; or (2) any authorization on the part of E/ICC for CHEM to communicate,
use, transfer or deliver any of E/ICC's System Technical Information and
Know-How outside of Republic of China or The People's Republic of China except
as provided in Article 10.
(d) Within the Territory, except for the Republic of China and the
People's Republic of China, E/ICC has the right to establish exclusive
distribution arrangements with other parties. If CHEM identifies a business
opportunity in the Territory outside the Republic of China and the People's
Republic of China, E/ICC will work together with CHEM to seek a business
arrangement to take advantage of the business opportunity, including
negotiating with third parties. In addition, as part of the business review
process established in Paragraph 3.1(b), CHEM shall have the right to nominate
countries within the Territory for non-exclusive distribution by CHEM, (so
long as exclusive arrangements have not been previously established by E/ICC).
Article 4. Compensation
4.1 Subject to: (i) obtaining the approval of CHEM's Board of Directors
which CHEM agrees to request at the first Board of Director's meeting which
follows the Effective Date, (ii) the performance bond in Schedule "D" of Two
Hundred Fifty Thousand
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Dollars (U.S. $250,000.00), and (iii) the Testing Specification in Schedule
"E"; CHEM agrees to pay to E/ICC the sum of Five Hundred Thousand Dollars
(U.S. $500,000.00) within twenty (20) days of the Effective Date. Such fee
shall be non-refundable and not applicable to any future royalty payments.
4.2 In consideration of the licenses granted by E/ICC to CHEM pursuant
to Paragraph 3.1(a) hereof, CHEM agrees to pay to E/ICC a running royalty of
two and one-half percent (2.5%) of CHEM's Sales Price, for all Systems which
are manufactured and sold by CHEM. CHEM shall not pay any running royalty for
Systems which are produced by CHEM at the written request of E/ICC which are
for delivery to E/ICC or to a customer of E/ICC.
4.3 CHEM agrees to pay to E/ICC a running royalty of five percent (5%)
of the Rotor Products Base price (as defined in the Supply Agreement) listed
in Schedule "C" of the Supply Agreement for all desiccant and thermal cassette
rotors that are utilized in CHEM Systems which are sold by CHEM. CHEM shall
not pay any running royalty for CHEM Systems which are produced by CHEM at the
written request of E/ICC which are for delivery to E/ICC or to a customer of
E/ICC.
4.4 E/ICC agrees to purchase and CHEM agrees to fabricate and sell
Systems and CHEM Systems as an original equipment supplier to E/ICC, on a
non-exclusive basis, as defined herein before. E/ICC agrees to work
cooperatively with CHEM to expand the manufacturing and sales opportunities in
the marketplace, based on CHEM's product competitiveness and market demand. In
the Southeast Asian countries, where practical, E/ICC agrees to present CHEM
with the opportunity to supply manufactured product for itself and E/ICC will
also request that its distributor(s) or agent(s), (exclusive or non-exclusive)
give CHEM the opportunity to supply manufactured product, based on CHEM's
product competitiveness including cost, quality, reliability and other
factors. As part of the yearly business review process established in
Paragraph 3.1(b), E/ICC will meet on a yearly basis with CHEM to review the
business performance. The parties agree to establish mutually the initial OEM
price, quantity, warranty, and other terms as required when the first such
System or CHEM System is completed. CHEM shall not pay any running royalty for
Systems or CHEM Systems which are produced by CHEM at the written request of
E/ICC which are for delivery to E/ICC or to a customer of E/ICC.
E/ICC will purchase systems on an FOB Keelung port basis based on a
Letter of Credit from E/ICC with payment terms within thirty (30) days of
invoice.
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Article 5. Improvements in Technology
5.1 CHEM shall promptly disclose to E/ICC any improvements and/or
developments relating to Systems (e.g., fan, control system, housing etc.)
developed by it during the term of this Agreement, together with the patents,
patent applications and technical information and know-how of CHEM relating
thereto, and shall grant and hereby agrees to grant to E/ICC a non-exclusive
royalty-free, non-transferable worldwide license outside of the Republic of
China and the People's Republic of China to make, have made, use and sell such
improvements and/or developments under its patents patent applications and
technical information and know-how. E/ICC shall have the right to convert its
non-exclusive license to an exclusive license; the royalty rate for the
exclusive license shall be five percent (5%) of E/ICC's Sales Price of each
such improved System sold by E/ICC.
5.2 In the event that CHEM develops a CHEM System, CHEM shall grant and
hereby agrees to grant to E/ICC a non-exclusive, non-transferable, worldwide
license under its patents, patent applications, technical information and
know-how for use outside of the Republic of China and the People's Republic of
China to make, have made, use and sell such CHEM System. For said license,
E/ICC agrees to pay to CHEM a royalty of five percent (5%) of E/ICC's Sales
Price for each such CHEM System sold by E/ICC.
Article 6. Manufacture and Quality Control
6.1 CHEM shall with reasonable assistance from E/ICC:
(a) obtain all necessary manufacturing and product licenses as well
as any other governmental permissions and registrations necessary for the
design, manufacture, packaging, sale and distribution of Systems;
(b) manufacture the Systems strictly in accordance with E/ICC's
specifications and directions;
(c) follow such quality control procedures as E/ICC shall from time
to time specify to assure that the Systems sold by CHEM under E/ICC's
trademarks and trade names meet E/ICC's quality standards and customer
specifications;
(d) ship to E/ICC at E/ICC's expense, if available if requested by
E/ICC a representative System produced by CHEM for test and approval of
quality by E/ICC; and
(e) permit the duly authorized representatives of E/ICC to inspect
during normal working hours each of CHEM's plants, the process of manufacture
and packaging of the Systems by CHEM, and
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cause to be inspected by them the plant of any contract manufacturer producing
any components used in production of the Systems when reasonably practicable.
6.2 The decision of E/ICC made after consultation with CHEM and taking
into consideration the views of CHEM shall be final as to whether the
provisions of Paragraph 6.1 are being properly met. If E/ICC's decision is
that a provision of Paragraph 6.1 is not being properly met by CHEM, then
E/ICC agrees to work with CHEM, at no charge to CHEM, to help to correct the
problem.
6.3 Systems which do not meet E/ICC's quality standards shall not be
sold or distributed by CHEM, unless all defects are corrected to the
satisfaction of E/ICC.
6.4 Despite any approval by E/ICC of Systems provided pursuant to this
Article, CHEM shall remain solely responsible for the quality of the System
which it produces, and CHEM agrees to exercise all due care and diligence in
the manufacture, processing, packaging, sale and distribution of the System.
Article 7. Records and Reports
7.1 Within thirty (30) days after the end of every six-month calendar
period (June 30 and December 31) (the "Period") during the term of this
Agreement, CHEM shall furnish to E/ICC a written report ("Report") duly
certified by an officer of CHEM setting forth, as of the end of such Period,
the total number of Systems and CHEM Systems sold-by or for CHEM during the
preceding Period, together with the Sales Price for each such System, and CHEM
Systems and the amount of-royalties payable hereunder for such Period.
Within fifteen (15) days after receipt of a Report, E/ICC shall issue an
invoice to CHEM for the royalties due and CHEM shall pay the invoice within
fifteen (15) days after receipt of an invoice. The first such Report shall be
submitted as herein set forth for the Period that covers from the Effective
Date of this Agreement up to either June 30, 1995 or December 31, 1995
whichever occurs first. A final report shall be rendered within sixty (60)
days after, and as of, the date of sale of the last System or CHEM System
manufactured under this Agreement with respect to all such Systems or CHEM
Systems sold up to the date of termination, but which was not covered by prior
reports. All payments to be made under this Agreement by CHEM to E/ICC shall
be made in United States Dollars and shall be made by wire funds transfer.
7.2 CHEM shall keep and maintain accurate and complete records and books
of account containing all information required for the computation and
verification of the amounts to be paid under this Agreement and such records
shall be made available by CHEM at such times as E/ICC shall reasonably
request.
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7.3 With respect to any payments to be made to E/ICC pursuant to the
terms of this Agreement, CHEM shall have the obligation to deduct any taxes,
fees, assessments or other charges of any kind imposed by the government of
Republic of China and the People's Republic of China any subdivision thereof,
or any other governmental unit within its territory (hereinafter referred to
as "Charges"). Such Charges shall be deducted by CHEM from payments due to
E/ICC and remitted to the appropriate governmental authority. CHEM shall
furnish documentation regarding the payment of any Charges so deducted to
E/ICC in sufficient detail to show the amount of the charge, the nature of the
charge and proof of payment of the charge. Notwithstanding the foregoing, CHEM
shall be responsible for payment of any value-added tax that may be imposed on
payments to E/ICC.
7.4 Where the provisions of this Agreement require the conversion into
United States Dollars of an amount initially computed in any other currency,
the amount of United States Dollars payable under this Agreement shall be
determined on the basis of the Exchange Rate in effect in the Republic of
China on the date such payment is made. In the event that payment is made
after the due date, the other currency obligation of CHEM shall be increased
to account for Exchange Rate fluctuations to the extent necessary, if any, to
produce the same United States Dollar payment to E/ICC which would have been
made if such payment had been made on the due date. Exchange Rate shall mean
the telegraphic transfer price charged by a Class A foreign exchange bank in
the Republic of China for purchases of United States Dollars by CHEM with New
Taiwan Dollars for payment abroad.
7.5 Any and all royalties or other sums that may become due and owing
from CHEM hereunder shall bear interest from and after the respective due
dates thereof at a rate of one percent (1%) per month.
Article 8. Markings and Descriptive Literature
8.1 E/ICC may require CHEM to utilize an E/ICC trade name or trademark
on all Systems, System Components and CHEM Systems (herein collectively
referred to as "SYSTEMS') sold by CHEM which are or contain any E/ICC
components.
8.2 In selling or promoting the sale of any SYSTEMS, CHEM shall obtain
the prior written consent of E/ICC directly to use any trademarks or trade
names of E/ICC or any trademarks or trade names similar thereto other than for
those trademarks and trade names that are specifically provided for herein.
8.3 CHEM shall insure that all labels, name tags, markings, cartons,
containers, package inserts and other promotional mate-
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rials relating to the SYSTEMS will comply with all relevant laws and
regulations of the countries where SYSTEMS are to be sold and also with
E/ICC's requirements.
8.4 Before any labels, name tags, markings, cartons, containers, package
inserts or other packaging material (hereinafter collectively referred to as,
"Packaging Materials) are used with SYSTEMS, CHEM shall submit to E/ICC an
original copy of the exact Packaging Materials to be used, and no such
Packaging Materials may be used until E/ICC has given its prior written
approval for its use. In the event that E/ICC shall fail to respond within
thirty (30) days of receipt of such submission, approval shall be deemed to
have been given.
8.5 CHEM may not distribute any descriptive literature, advertising or
any material concerning the SYSTEMS without first furnishing E/ICC with drafts
thereof and requesting and securing E/ICC's written approval for such
material. In the event that E/ICC shall fail to respond within thirty (30)
days of receipt of such request, consent will be deemed to have been given.
Article 9. Trademarks
9.1 Subject to the terms and conditions of this Agreement and in further
consideration of the fees received hereunder, E/ICC hereby grants to CHEM the
non-exclusive right to use E/ICC; unregistered trade names and registered
trademarks, when obtained, for example, Desert Cool, DESI/AIR and other E/ICC
trademarks ("Licensed Marks") in connection with Systems or CHEM Systems for
distribution and sale in the Territory.
9.2 The Licensed Marks shall be used by CHEM only with respect to
Systems and CHEM Systems as shall be approved in advance in writing by E/ICC.
9.3 CHEM agrees to maintain such quality standards as shall be
prescribed by E/ICC in the conduct of the business operations with which the
Licensed Marks are used and for the goods on which the Licensed Marks are
used. CHEM agrees to manufacture or have manufactured Systems in accordance
with such specifications as may be prescribed by E/ICC from time to time.
9.4 CHEM agrees that it will display the Licensed Marks only in such
form or manner as shall be specifically approved in writing in advance by
E/ICC. CHEM also shall cause to appear on all materials on or in connection
with which the Licensed Marks are used, such legends, markings and notices as
E/ICC may request in order to give appropriate notice of any trademark rights
therein.
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9.5 Upon reasonable notice and during normal business hours, E/ICC shall
have the right to inspect CHEM's business operations conducted under the
Licensed Marks in order to assure E/ICC that the provisions of this Agreement
are being observed. Such inspection shall include quality control data
related to the Systems and including samples for testing by E/ICC when so
requested. E/ICC will attempt not to disturb normal business operations during
such inspections.
9.6 CHEM acknowledges E/ICC's ownership of the Licensed Marks and CHEM
agrees that all use by CHEM of the Licensed Marks shall be in accordance with
the directions of E/ICC for their use and that all use of the Licensed Marks
by CHEM shall inure to E/ICC's benefit.
9.7 As of the Effective Date, E/ICC is not aware of any third party
trademark rights that would be infringed by CHEM's use of the Licensed Marks
as contemplated hereunder.
Article 10. Confidentiality
10.1 Except as specified in this Paragraph and except to the extent that
such E/ICC System Technical Information and Know-How ("INFORMATION") is or
becomes public knowledge otherwise than by any act or omission of CHEM, all
INFORMATION disclosed under this Agreement, and all samples and materials
embodying such INFORMATION shall be treated by CHEM as confidential and shall
not be disclosed or made available to any third party. CHEM shall have the
right to disclose such INFORMATION and samples and materials embodying such
INFORMATION to a potential purchaser of Systems but only to the extent
necessary for the use of such Systems by such purchaser; provided, however,
that prior to any such disclosures, and as a condition thereto, such purchaser
shall have entered into with CHEM a confidentiality agreement to hold such
INFORMATION and samples and materials in confidence; not to disclose such
INFORMATION or make available such samples and materials to any other third
party; not to analyze such samples or materials; and not to use same except in
connection with the commercial use of System purchased from CHEM; such
obligations will continue for a period of fifteen (15) years after the date
the INFORMATION is disclosed or samples and materials are made available,
except to the extent such INFORMATION is or becomes public knowledge otherwise
than by any act or omission of such purchaser. CHEM shall have the right to
disclose such INFORMATION and make available samples and materials embodying
same to those of its management and technical or production employees who
shall have a need to know same for the purposes provided by this Agreement and
who shall have entered into a confidentiality agreement with E/ICC in the form
shown in Appendix "A" hereof. CHEM shall be liable to E/ICC for any disclosure
of INFORMATION and sample materials by such employee or purchaser
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unless such disclosure was authorized in advance in writing by E/ICC. CHEM
shall use the INFORMATION disclosed under Article 2 only in performing under
the licenses granted pursuant to Article 3. If a license granted pursuant to
Paragraph 3.1(a) is terminated, CHEM agrees to refrain from using for any
purpose such of the INFORMATION as is related to the terminated license.
Article 11. Patent, Technical Information
And Know-how and Assistance
11.1 E/ICC shall have the right to review CHEM's Systemrelated
improvements and developments and to recommend the filing of one or more
patent applications in one or more countries thereon. If CHEM has not filed
patent applications thereon and/or does not wish to follow E/ICC's
recommendation with respect to any particular country, then E/ICC shall, after
consultation with CHEM, have the right to file such patent applications. CHEM
agrees to fully cooperate and cause its employees to fully cooperate with
E/ICC to effect the filing and prosecution of said patent applications. The
parties shall jointly own such patent applications and any resulting patents
and they agree to share equally all expenses related thereto.
11.2 All information of United States origin made available directly or
indirectly under this Agreement by E/ICC to CHEM for use outside the United
States shall be used by CHEM subject to and in accordance with the regulations
of any department or agency of the United States Government. Such information
or the direct product thereof shall not be exported or shipped by CHEM to any
destination which requires the approval of the United States Government for
such exportation or shipment until a request to do so has been submitted to
and approved by the United States Government and E/ICC. To the extent such
information or the direct product thereof may be offered in a country where
such approval for the export of technology would be required, CHEM shall
assist E/ICC in providing sufficient information in a timely manner so that
requisite approvals may be obtained.
11.3 In the event that E/ICC determines that a third party is infringing
a E/ICC System patent licensed hereunder, E/ICC shall either take appropriate
action at its own expense against the third party infringer, or give CHEM
authority to take such appropriate action against the third party infringer at
CHEM's expense or E/ICC expense as authorized, in either case, the parties
agree to assist each other to the extent reasonably necessary.
Article 12. Warranties
12.1 E/ICC represents that E/ICC's System Technical Information and
Know-How disclosed to CHEM will be the same technology
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used by or being developed for use by E/ICC in the commercial production of
Systems, will be prepared with reasonable care, and will, if properly applied
by CHEM enable CHEM to manufacture products substantially equal in quality to
Systems produced by E/ICC using such technology. E/ICC also represents that it
has no knowledge as of the Effective Date that would indicate that
manufacturing of Systems using E/ICC System Technical Information and Know-How
would infringe any patent, technical information or know-how owned by a third
party. Other than the above representations, E/ICC hereby disclaims any
warranty or representation regarding the above matters.
12.2 If E/ICC's System Technical Information and Know-How which-is
disclosed hereunder is not the same technology which, at the time of transfer,
was used by or was being developed for use by E/ICC, or is defective, then
E/ICC's sole responsibility shall be to replace such Technical Information and
Know-How with technology that E/ICC was using or had developed. In no event
shall E/ICC be liable for incidental, consequential or special damages
incurred by CHEM arising out of or relating to the use of E/ICC's System
Technical Information and Know-How.
Article 13. Term
13.1 This Agreement shall come into effect on the Effective Date and
shall continue in effect for a period of five (5) years and shall be renewed
automatically from year to year thereafter, subject to the receipt of
necessary government approvals; provided, however, that after the expiration
of the initial term of the Agreement either E/ICC or-CHEM may terminate this
Agreement on December 31 of any year by giving to the other at least six (6)
months prior written notice.
Article 14. Termination
14.1 Notwithstanding the foregoing Article 13, this Agreement may be
terminable forthwith upon the sending of notice in writing upon the occurrence
of one or more of the following events:
(a) by either party hereto, if all necessary government approvals
for this Agreement as well as all related agreements have not been received in
form and substance acceptable to such party within nine (9) months from the
Effective Date provided that all necessary documents have been timely provided
by the responsible party;
(b) by the other party hereto, if a party hereto shall commit a
breach of any of its obligations under this Agreement which it shall fail to
remedy within forty-five (45) days from written notice being given requiring
that breach to be remedied;
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(c) by the other party hereto, if a party hereto shall be or become
incapable for a period of six (6) months of performing any of its said
obligations under this Agreement because of any event covered by Article 18
hereof;
(d) by the other party hereto, if a party hereto or its creditors
or any other eligible party shall file for that parties dissolution,
liquidation, bankruptcy, reorganization, compulsory composition or if that
party is unable to pay any debts as they become due, has explicitly or
implicitly suspended payment of any debts as they became due, or if the
creditors of that party have taken over its management, or if the relevant
financial institutions have suspended that party's clearing house privileges,
or if any material or significant part of that party's undertaking, party or
assets shall be totally expropriated or confiscated by action of any
government.
Article 15. Consequences of Termination
15.1 Upon termination of this Agreement, all licenses and rights granted
pursuant to Article 3 and obligations undertaken hereunder shall forthwith
terminate except (i) the obligations of CHEM under Article 7 to report and pay
to E/ICC all royalties due to the date of termination shall continue, (ii) the
obligations of CHEM to maintain the books and records and E/ICC's rights to
examine the books and records of CHEM shall continue as specified in Article
7, (iii) the obligation of confidentiality of CHEM under Article 10 shall
survive such termination, and (iv) such termination shall not relieve either
party from any obligations accrued to the date of termination or relieve the
party in default or breach from liability and damages to the other for default
or breach of this Agreement.
15.2 Upon any termination of this Agreement, CHEM shall take all actions
necessary to cancel any and all rights CHEM may have to use the E/ICC System
Patents and to provide E/ICC with suitable evidence of such cancellations if
E/ICC exercises its option to demand it. Notwithstanding the above, CHEM shall
be permitted, for a period of one (1) year after any termination, to dispose
of stocks on hand at such date subject to payment to E/ICC of royalties
thereon in accordance with Article 4.
Article 16. Non-Waiver/Other Remedies
16.1 Failure of either party to insist upon the strict and punctual
performance of any provision hereof shall not constitute waiver of, or
estoppel against asserting the right to require such performance, nor shall a
waiver or estoppel in one case constitute a waiver or estoppel with respect to
a later breach whether of similar nature or otherwise.
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16.2 Nothing in this Agreement shall prevent a party from enforcing its
rights by such remedies as may be available in lieu of or in addition to
termination.
Article 17. Unenforceable Terms
17.1 In any event any term or provision of this Agreement shall for any
reason be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not effect the validity of any remaining
portion which shall remain in full force and effect as if the invalid portion
was never a part of this Agreement when it was executed. Should the severance
of any such part of this Agreement materially affect any other rights and
obligations of the parties hereunder, the parties hereto will negotiate in
good faith to amend this Agreement in a manner satisfactory to the parties.
Failing agreement on such amendment, either party may by notice in writing
terminate this Agreement forthwith subject to the provisions of this Agreement
relating to consequences of termination.
Article 18. Force Majeure
18.1 The failure or delay of any party hereto to perform any obligation
under this Agreement solely by reason of acts of God, acts of government
(except as otherwise enumerated herein), riots, wars, strikes, lockouts,
accidents in transportation or other causes beyond its control shall not be
deemed to be a breach of this Agreement; provided, however, that the party
so prevented from complying herewith shall continue to take all actions within
its power to comply as fully as possible herewith.
18.2 Except where the nature of the event shall prevent it from doing
so, the party suffering such force majeure shall notify the other party in
writing within fourteen (14) days after the occurrence of such force majeure
and shall in every instance, to the extent it is capable of doing so, use its
best efforts to remove or remedy such cause with all reasonable dispatch.
Article 19. Disclaimer of Agency
19.1 This Agreement shall not be deemed to constitute either party
hereto the agent of the other party hereto.
Article 20. Assignability
20.1 Neither party shall have the right to transfer or assign its
interest or rights in this Agreement or delegate its obligations under this
Agreement without the prior written consent of the other party.
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20.2 The provisions of Paragraph 20.1 notwithstanding, either party may
freely assign its interest, rights and obligations in this Agreement to an
entity that acquires substantially all of the business assets of the assigning
party to which this Agreement applies.
Article 21. Notices
21.1 Any notice required or permitted hereunder shall be sufficiently
given if delivered personally or if sent by air mail, registered, postage
prepaid, or by cable, telex or telefax if confirmed on the same day in writing
by registered air mail, to such address as the party may have designated in
writing for receipt of notices and other documents. Any notice shall be
deemed to have been given, if sent by registered air mail, as of the tenth
(10) day following the date of deposit thereof in the U.S. Mails or the
Republic of China post, postage prepaid, or if absent by telex, cable or
telefax seventy-two (72) hours after dispatched (except that a notice of a
change of address shall not be deemed to have been given until received by the
addressee).
Engelhard/ICC
000 Xxxxx 0xx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Chief Financial Officer
Fax No. 0-000-000-0000
Xxxxx-Xxxx Electric & Machinery Manufacturing Corp.
25, Wen-T Rd., Lo Shan Tsun,
Kwei Xxxx Xxxxxx,
Taoyuan Hsien, Taiwan, ROC
Attn: Division General Manager
Air-Conditioning Products Division
Fax No. 000-0-000-0000
Article 22. Language
22.1 This Agreement is written in the English language and executed in
two (2) counterparts, each of which shall be deemed an original. The English
language text of the Agreement shall prevail over any translation thereof.
Article 23. Governing Law
23.1 The construction, validity and performance of this Agreement shall
be governed in all respects by the laws of Singapore (excluding any such laws
that may direct the application of the laws of another jurisdiction). The
parties hereby submit to the exclusive jurisdiction of the Singapore Courts
for all purposes
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in relation to this Agreement and waive any objections to such jurisdiction on
the grounds of venue or forum non conveniens or similar grounds.
Article 24. Effective Date
24.1 This Agreement shall come into effect on the date that is first
above-written.
24.2 Notwithstanding Paragraph 24.1 hereof, Articles 2 through 9 of this
Agreement shall remain wholly executory until all necessary government
approvals and validations for this Agreement as well as all related agreements
are obtained in form and substance acceptable to both parties hereto.
Article 25. Entire Agreement
25.1 This Agreement supersedes all previous representations,
understandings or agreements, oral or written, between the parties with
respect to the licensing of Systems, CHEM Systems, E/ICC's Systems Patents and
E/ICC Technical Information and Know-How, and together with the exhibits
hereto and the agreements and documents contemplated hereby contains the
entire understanding of the parties as to the terms and conditions of their
relationship.
25.2 Terms included herein may not be contradicted by evidence of any
prior oral or written agreement or of a contemporaneous oral or written
agreement.
25.3 No changes, alterations or modifications hereto shall be effective
unless in writing and signed by authorized representatives of all parties
hereto and if required, upon approval by the competent authorities of Republic
of China, and the United States of America.
25.4 Heading of Articles in this Agreement are for convenience only and
do not substantially affect the terms of this Agreement.
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IN WITNESS WHEREOF, the authorized representatives of the parties hereto
have set their hands or their names and seals, the day and year first above
written.
ENGELHARD/ICC
By: /s/ XXXXXX X. XXXXXXXXXXXX
--------------------------
Name: Xxxxxx X. Xxxxxxxxxxxx
Title: Co-Chairman
XXXXX-XXXX ELECTRIC AND MACHINERY
MANUFACTURING CORPORATION
By: /s/ PAO-SHAN KU
------------------------
Name: Pao-Shan Ku
Title: President
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