AGREEMENT FOR RESEARCH,
DEVELOPMENT AND LICENSING OF
TECHNOLOGIES
BETWEEN
ENERGY VENTURES INC. (CANADA)
AND
PACIFIC LITHIUM LIMITED
PLL
October 13, 1999
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
AGREEMENT FOR RESEARCH, DEVELOPMENT AND COMMERCIALISATION OF TECHNOLOGIES
PARTIES
1. ENERGY VENTURES INC. (CANADA) a duly incorporated company having its
registered office in Canada (with its affiliates, called "EVI") and
2. PACIFIC LITHIUM LIMITED a duly incorporated company having its
registered office in New Zealand (with its affiliates, called "PLL")
Background
A. EVI is the sole and exclusive world-wide licensee and/or owner of the
proprietary rights in certain valuable Products and Processes
comprising lithium manganese oxide compounds for use as cathodes in
battery applications developed and/or owned by National Research
Council of Canada ("NRC") which proprietary rights include patents,
copyright and confidential information.
B. EVI wishes NRC and PLL to carry out additional research and development
on the Products and Processes to develop them into commercially
feasible processes and products.
C. In the event that NRC and PLL are able to work together to develop
their respective Products and Processes to produce commercially
feasible Products and Processes, PLL will elect to exercise the License
Rights to be granted by EVI under this Agreement.
D. EVI grants PLL the rights to the Licensed Products set out in this
Agreement on the terms and conditions in this Agreement.
THE PARTIES AGREE
1. The terms set out in Parts 1, 2 and 4 of this Agreement shall apply as
from the Commencement Date.
2. The terms set out in Parts 1, 2, 3 and 4 of this Agreement shall apply
in the event that the preconditions set out in Part 3 are satisfied.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 19992
THIS AGREEMENT WAS EXECUTED as of the 13th day of October 1999
SIGNED by PACIFIC LITHIUM LIMITED in accordance with its Constitution:
_________________________________ _________________________________
Signature of authorised person Signature of authorised person
_________________________________ _________________________________
Office held Office held
_________________________________ _________________________________
Name of authorised person (print) Name of authorised person (print)
SIGNED by ENERGY VENTURES INC. (CANADA)
in accordance with its Constating Documents:
_________________________________ _______________________________________
Signature of authorised person Signature of authorised person
President and Chief Executive Officer Vice President of Finance and Treasurer
D. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name of authorised person (print) Name of authorised person (print)
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
PART 1
Interpretation
Presumptions of interpretation
1.0 Unless the context otherwise requires, a word which denotes:
1.1 The singular denotes the plural and vice versa;
1.2 Any gender denotes the other genders; and
1.3 A person includes an individual, a body corporate and a
government.
2.0 Unless the context otherwise requires, a reference to:
2.1 Any legislation includes any regulation or instrument made
under it and where amended, re-enacted or replaced means that
amended, re-enacted or replacement legislation;
2.2 Any other agreement or instrument where amended or replaced
means that agreement or instrument as amended or replaced;
2.3 A Clause, Schedule or annexure is a reference to a clause of,
annexure to, schedule to or exhibit to this Agreement;
2.4 A group of persons includes any one or more of them;
2.5 A party or parties is a reference to a party to or the parties
to this Agreement; and to their affiliates ("affiliate" having
the same meaning given to it in section 1(4) of the Ontario
Business Corporations Act); and
2.6 A thing or amount is a reference to the whole and each part of
it.
Joint and several
3.0 Agreement warranty representation or obligation which binds or
benefits 2 or more ons under this Agreement binds or benefits
those persons jointly and separately.
Successors and assigns
4.0 A person includes the trustee, executor, administrator,
successor in title and assign of that on. This Clause must not
be construed as permitting a party to assign any right under
this Agreement.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
Business day
5.0 A business day is a day during which banks are open for
general banking business in Ontario.
6.0 Unless the context otherwise requires, a term of this
Agreement which has the effect of requiring anything to be
done on or by a date which is not a business day must be
interpreted f it required it to be done on or by the next
business day.
Definitions
7.0 Where commencing with a capital letter:
"Commencement Date" means 9 August 1999
"Confidential Information" means, in respect to each
disclosing party, all information vided by that party
including its Intellectual Property, and all other information
relating to processes, business and products where knowledge
of such information is not in the public domain and might
reasonably be regarded by the receiving party to be
confidential.
"Confirmation Date" means the date on which PLL gives notice
of its intention to take up License Rights under Clause 20 but
in any event shall be not later than 31 March 2000.
"Contract Years" refers to the 12 month periods commencing on
1 April 2000.
"Intellectual Property" means, in respect to each party, all
intellectual property of such party and of any related entity
including the patents, patents pending, copyright, secret
information and processes, all trade marks, trade names,
know-how and all other information which is commercially
sensitive or commercially valuable to that party;
"License Rights" means the rights for PLL to take a license of
the Licensed Products in accordance with the terms of Part 3
of this Agreement.
"License Term" means the period starting on I April 2000 and
continuing until the last expiry date of the Patents.
"Licensed Products" means all Intellectual Property and
Confidential Information with respect to the Products and
Processes owned by EVI or licensed or assigned to it and/or
owned by NRC, either wholly or jointly with PLL or any other
persons.
"Minimum Guaranteed Royalty Fees" means the Minimum Guaranteed
Royalty Fees payable by PLL set out in column 4 of SCHEDULE D.
"Patents" means the patents for the Products set out in
Schedule A and such other patents owned by EVI or NRC which
are added by mutual agreement with PLL to Schedule A during
the License Term.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999 "Processes" means the processes relating to the synthesis of
Products and "PLL's Processes" shall mean the processes developed by PLL prior
to, during and after the Research and Development Program which enable or will
enable it to synthesise the Products commercial basis.
"Products" means lithium manganese oxide-based products for
use as cathodes in battery lications which have been made
using the Processes developed by or licensed or assigned VI or
by PLL and EVI during the conduct of the Research and
Development Program or D program, and such other products as
the parties may from time to time include but ch shall exclude
Products developed by PLL prior to or outside of the Research
and Development Program or R&D program.
"R&D" means the research and development program referred to
in Clause 13.2.
"Research and Development Contributions" means fees payable by
PLL to EVI on account of NRC's costs in carrying out the
Research and Development Program pursuant to use 13. 1.
"Research and Development Program" means the research program
set forth in SCHEDULE B.
"Royalty Fees" means the fees or share of revenue payable by
PLL to EVI on the Licensed ducts set out in SCHEDULE C.
"S" and "dollars" mean US dollars.
"Territory" means the World
Extension of definitions
Where a word or phrase is given a defined meaning, another
part of speech or other grammatical form in respect of that
word or phrase has a corresponding meaning.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
PART 2
Research and Development of Processes and Products
Conduct of Research and Development Program
9.0 PLL shall use its best efforts to conduct the Research and
Development Program with NRC EVI in accordance with the
timetable, protocols, objectives and procedures set out in
Schedule B.
10.0 The Research and Development Program shall be carried out by
the personnel set out in edule B or by such other persons who
shall be acceptable to PLL, NRC and EVI.
11.0 The Research and Development Program shall be carried out at
PLL and NRC's respective arch centres and PLL shall give the
researchers access to all necessary facilities to enable
Research and Development Program to be conducted efficiently.
EVI shall ensure that C cooperates with PLL in relation to the
Research and Development Program.
12.0 PLL shall appoint one person to an Oversight Committee and EVI
shall ensure NRC also appoints one person. The Oversight
Committee shall supervise the conduct of the Research
Development Program and shall be responsible for resolving all
issues relating to the day conduct of the Research and
Development Program.
Costs of the Research and Development Program and of R&D 13.0
PLL shall pay EVI:
13.1 The Research and Development Contributions in respect
to the Research and Development Program at the rate
of $22,225 per calendar month commencing on
Commencement Date and monthly thereafter, terminating
on the expiry of three month's notice given by PLL of
its intention to cease participation in the Research
and Development Program, such notice not to be given
before I January 2000, such that the total Research
and Development Contributions required to be paid by
PLL in respect to the Research and Development
Program shall be not less than $200,000; and
13.2 In respect of R&D required by PLL to be carried out
by NRC, following the completion of the Research and
Development Program, for further research and
development of the Licensed Products or Products,
such fee amount, not to be less than $ 1 00,000 per
Contract Year, as is stipulated by PLL, and such
further amounts per Contract Year as PLL and EVI
shall agree PROVIDED THAT if PLL wishes to stipulate
an amount below $ 1 00,000 in any Contract Year, it
shall only be entitled to license any new Products
developed by EVI or NRC in and after that Contract
Year on the commercial terms that EVI shall determine
and PROVIDED FURTHER that
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
all R&D must be documented in a manner similar to
that of Schedule B and agreed'te, by both EVI and
NRC.
Grant of rights to Licensed Products 14.0 EVI grants to PLL
and PLL accepts the following:
14.1 The sole and exclusive rights to exploit those
Licensed Products exclusively licensed or assigned to
EVI by NRC as at the Commencement Date.
14.2 The non-exclusive rights to exploit those Licensed
Products which are licensed to EVI or jointly owned
by EVI with any other party following license or
assignment to EVI by NRC as at the Commencement Date
for a term commencing on the Commencement Date and terminating
on the later of 31 h 2000 or the date of effective termination
of this Agreement. During this term, EVI 11 not itself use for
commercial purposes (except for research and development) nor
shall cerise any of the rights granted to PLL under this
Agreement to any other person and shall ensure that NRC shall
do the same.
Ownership of jointly developed Products
15.0 Any new Products conceived or first reduced to practice in the
course of or as a result of the earch and Development Program
or the R&D program shall, subject to Clause 13.2, be gned into
the joint ownership of PLL and EVI and shall either be
licensed exclusively to pursuant to this Agreement if PLL
exercises its License Rights or may be used by PLL EVI
independently of each other if PLL does not exercise its
License Rights PROVIDED AT where the Products have been
developed using the intellectual property rights of any d
person, the parties shall be subject to the rights of such
third person as to the ownership rights to the new Products.
For further clarification, prior to I April 2000, PLL agrees
not to sell Licensed Products or ducts in commercial
quantities to any person, without the written permission of
EVI.
Protection of the Intellectual Property in the jointly
developed Products
16.0 PLL shall either at its discretion or at the request of EVI,
file and keep current in the joint es of EVI and PLL such
patent applications as are reasonably required to protect the
erests of EVI and PLL in the Intellectual Property for the
jointly developed Products in the countries that the parties
consider appropriate. The costs of applying for, prosecuting
and maintaining such patent applications shall be borne by
PLL.
17.0 I shall at the request of PLL, provide PLL with all documents
required by PLL to effect filing of the patent applications
and shall ensure NRC provides the same, including ignments of
rights signed by the inventors employed by NRC.
Ownership of Processes
18.0 EVI acknowledges:
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
18.1 as at the date of execution of this Agreement, PLL is
the owner of PLL's Processes and that neither EVI nor
NRC have developed their know-how to the point that
they can synthesise the Products on a commercially
viable basis.
18.2 for itself and NRC, that all additions to PLL's
Processes conceived or first reduced to practice in
the course of or as a result of the Research and
Development Program shall be assigned into the sole
and exclusive ownership of PI,L.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
PART 3
Licensing of Processes and Products
Confirmation of uptake of License Rights
19.0 This Part 3 shall commence and be in full force and effect if
PI,L in its absolute discretion determines that the jointly
developed Processes and Products are capable of producing
processes and products which meet PLL's target specifications
(which include performance, price, ability to be commercially
manufactured, stability and other factors) and gives notice to
that it takes up the License Rights hereunder.
Part 3 conditional
20.0 The application of this Part 3 is conditional upon PLL
confirming its wish to take up the License Rights on or before
31 March 2000 or such later date agreed by EVI, failing which,
Part 3 shall have no effect.
Grant of License Rights
21.0 EVI or, at the election of EVI any related company of EVI, in
respect of any part of the following rights, grants to PLL and
PLL accepts the following for the License Term:
21.1 The sole and exclusive rights to exploit the Licensed
Products owned by EVI or exclusively licensed or
assigned to EVI by NRC as at the Confirmation Date.
21.2 The non-exclusive rights to exploit the Licensed
Products owned by EVI or jointly owned by EVI with
any other party or non-exclusively licensed or
assigned to EVI by NRC as at the Confirmation Date.
21.3 The exclusive rights to exploit the Licensed Products
and Processes and Products either owned by EVI or
licensed or assigned to EVI by NRC or jointly owned
by EVI with PLL following licensing or an assignment
to EVI by NRC which exist at I April 2000 or which
arise at any time during the License Term, subject to
the provisions of Clause 13.2.
Should EVI elect that the grant of the above rights be in part
or in total by a related company EVI, the parties agree, in
such event, to execute such appropriate other agreement or
agreements containing the terms herein agreed.
Consideration for License Rights 22.0 PLL shall pay to EVI the
following:
22.1 The Minimum Guaranteed Royalty Fee for the first
Contract Year of $ 1 00,000 which shall be paid
within 90 days of the Confirmation Date; and
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
22.2 Either:
(a) The Royalty Fees calculated on the license fees and royalties
or on the net sales of manufactured Licensed Products and
Products in each Contract Year, as set out in Schedule C,
subject to adjustment pursuant to Clauses 25 and 26; or
(b) The Minimum Guaranteed Royalty Fees of each Period or Contract
Year as set out in Column 4 of Schedule D.
whichever shall be the greater
PROVIDED THAT
(c) respecting the first Contract Year only, the amount so
computed shall be reduced by the $100,000 to be paid as per
Clause 22. 1;
(d) the amounts paid by PLL to EVI in respect of R&D as per Clause
13.2 shall be credited to PLL as non-refundable payments on
account of the Minimum Guaranteed Royalty Fees of the Contract
Year of receipt of payment;
(e) The Minimum Guaranteed Royalty Fees payable respecting any
Contract Year shall be adjusted to reflect the actual selling
price of Licensed Products or Products and of battery cells
utilising the Licensed Products or Products.
23.0 The Royalty Fees, shall be calculated quarterly and payable no later
than 30 days following the end of each Contract Year quarter. The
payment respecting the final quarter of any Contract Year shall be
adjusted as required to attain at least the Minimum Guaranteed Royalty
Fees for that Contract Year.
24.0 Research and Development Contributions shall be treated by EVI as
non-refundable advance payments of the Minimum Guaranteed Royalty Fees
through 31 March 2000. Amounts paid by PLL to EVI in respect of R&D as
per Clause 13.2 shall be credited to PLL as nonrefundable payments on
account of the Minimum Guaranteed Royalty Fees as set out in Column 4
of Schedule D of the applicable Contract Year or on account of Royalty
Fees of such year.
Adjustment to Royalty Fees 25.0 EVI acknowledges that:
25.1 PLL is the licensee of products and processes developed and
owned by third parties (including Massachusetts Institute of
Technology) and that there may be advantages in combining
those third parties' know-how with the Licensed Products or
Products;
25.2 It will join in negotiations with PLL and such third parties
and shall in good faith, use its best efforts to agree on the
amount of Royalty Fees or royalties to be paid by PLL to EVI
and the third parties provided that the total Royalty Fees or
royalties
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
payable by PLL to all parties shall not exceed the Royalty
Fees that would have been payable to EVI if the third parties
know-how had not been used. Multiple Royalty Fees shall not be
due to EVI if the sale, use, lease or manufacture of any
Licensed Products or Products is covered by more than one of
the Patents. Nothing in this Clause shall oblige EVI to accept
a reduction in the Royalty Fees due to it.
26.0 If PLL funds R&D as per Clause 13.2 in an amount below $1 00,000 for
any Contract Year within the first five years of the License Term, the
license set out in this Agreement shall cease to be "sole and
exclusive" for Contract Years subsequent to such year and the Minimum
Guaranteed Royalty Fees as set out in Column 4 of Schedule D shall
reduce by:
26.1 one third for the sixth to tenth Contract Years of the License
Term subsequent to such year;
26.2 two thirds for the eleventh to fifteenth Contract Years of
the License Term subsequent to such year;
and thereafter be at zero.
Payment of Patent costs
27.0 PLL shall manage the prosecution, grant and continuing registration of
all patents filed or required by the parties to be filed in respect to
the Licensed Products or Products and shall promptly pay all such
costs.
Target Sales
28.0 PLL shall use its best endeavours to:
28.1 Construct and commission a pilot plant capable of producing
commercial quality Products on or before the Confirmation
Date; and
28.2 Achieve the target sales of Products set out in SCHEDULE D.
Information and Audit
29.0 EVI shall be entitled to receive:
29.1 Quarterly reports from PLL detailing research and development,
manufacturing, marketing and sales activities in the preceding
Contact Year quarter, within 30 days of the end of such
quarter;
29.2 Such information that EVI may reasonably require to calculate
the amount of Royalty Fees computed as per Schedule C; and
29.3 Advice of all sublicenses granted by PLL respecting Licensed
Products or Products and, within a reasonable period of time
after the grant of any such sublicense, a certified copy of
such sublicense agreement.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
30.0 EVI may from time to time, by its representative or by an independent
accountant or auditor, examine or audit the records of PLL relating to
any information which PLL has provided to EVI or which PLL is required
to have provided to EVI but has failed to do so.
31.0 EVI shall pay the cost of any inspection or audit carried out pursuant
to the immediately preceding Clause if the audit or inspection
establishes that information provided by PLL to EVI was complete and
correct.
32.0 PLL shall pay the cost of any inspection or audit carried out pursuant
to Clause 30 if the audit or inspection is required to obtain
information which PLL has failed to provide or if the audit or
inspection establishes that information provided by PLL to EVI was
incorrect or incomplete other than in a particular which is trivial or
minor.
Collaborative marketing
33.0 PLL acknowledges that EVI wishes PLL to sublicense the use of the
Licensed Products or Products by battery manufacturers for maximum
generation of Royalty Fees. PLL and EVI agree to collaborate on the
identification, presentation and marketing of sub-licenses of the
Licensed Products or Products to battery manufacturers and such other
potential sublicensees as the parties consider appropriate from time to
time. PLL shall not refuse to grant a sub-license of the License Rights
to any person who meets the criteria reasonably set by PLL and EVI for
a suitable licensee except with the prior approval of EVI, such
approval not to be unreasonably withheld.
Termination of exclusivity of License Rights
34.0 The exclusivity of the License Rights may be reduced to non-exclusive
License Rights by:
34.1 EVI, in the event that PLL fails to meet a) the Minimum
Guaranteed Royalty Fees in any two consecutive Contract Years
and b) the accumulative Minimum Guaranteed Royalty Fees of the
same two consecutive Contract Years, or
34.2 PLL, in the event that it reasonably believes that it will be
unable to meet the Minimum Guaranteed Royalty Fees respecting
Contract Years ending 31 March 2003 or later,
and in such circumstances:
(a) the Minimum Guaranteed Royalty Fees shall reduce in
accordance with Clause 26 PROVIDED THAT if PLL has
paid EVI Royalty Fees of at least $ 1,000,000 as at
that date, the Minimum Guaranteed Royalty Fees shall
then not apply to PLL; and
(b) EVI may grant License Rights to any other
person or persons on such terms and conditions
as it considers appropriate.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
(c) where EVI grants License Rights to another person on
terms and conditions more favourable than those
applying to PLL under this Agreement, EVI shall
extend the more favourable terms and conditions to
PLL.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
PART 4
General Terms and Conditions
Ownership of Intellectual Property
35.0 PLL acknowledges and agrees that EVI has license or other rights to the
Intellectual Property tn respect to EVI's and NRC's Processes and
Products. In order to protect and maintain EVI's and NRC's rights in
the above, PLL shall:
35.1 Use EVI's and NRC's Intellectual Property solely in accordance
with this Agreement and in accordance with all instructions,
rules and procedures prescribed by EVI and NRC from time to
time;
35.2 Not orally or in writing attack or contest, including by or in
any administrative or judicial action or proceeding before any
governmental authority, the ownership of EVI's or NRC's
Intellectual Property nor will PLL orally or in writing
disparage the name, the Intellectual Property or the
reputation of EVI or NRC.
36.0 EVI acknowledges and agrees on behalf of itself and NRC, that PLL has
sole and exclusive rights to the Intellectual Property in respect to
PLL's Processes and PLL's Products. In order to protect and maintain
PLL's rights in the above, EVI shall (and shall ensure that NRC shall
also):
36.1 Use PLL's Intellectual Property solely in accordance with this
Agreement and in accordance with all instructions, rules and
procedures prescribed by PLL from time to time;
36.2 Not orally or in writing attack or contest, including by or in
any administrative or judicial action or proceeding before any
governmental authority, the ownership of PLL's Intellectual
Property nor orally or in writing disparage the name, the
Intellectual Property or the reputation of PLL.
37.0 EVI warrants and undertakes to PLL that EVI and/or its related
companies have full right, power and entitlement to grant to PLL the
License Rights over all of NRC's Licensed Products and Products and
NRC's Processes set out in this Agreement and NRC shall provide PLL
with such evidence as PLL shall reasonably require to establish such
claim.
Rights in the Intellectual Property Upon Termination of this Agreement 38.0 On
termination of this Agreement PLL and EVI will:
38.1 Immediately cease to use the Intellectual Property of the
other (including, in the case of PLL ceasing to use the
Intellectual Property of NRC), except for Intellectual
Property jointly owned by PLL and EVI;
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
38.2 Not thereafter do or display or suffer or permit to be done or
displayed any act matter or thing which may lead or induce or
shall be calculated or likely to lead or induce members of the
public to believe that the parties are still connected or
associated in any way with each other or are still entitled to
market or distribute the Products
and EVI shall ensure that NRC shall also comply with the obligations of
this Clause as if it were EVI.
39.0 If any party fails to comply with Clause 38.2 then the other party by
its employees and agents may enter the defaulting party's premises and
remove all of its Intellectual Property and material relating to its
Intellectual Property. All costs and expenses incurred in so doing
shall be recoverable as a debt owing by the defaulting party.
Confidentiality
40.0 No party will (and EVI shall ensure that NRC shall not) disclose
to any person any Confidential Information, unless that disclosure
is expressly authorised in writing by the owner of such Confidential
Information.
41.0 Other than may be necessary to reasonably carry out either party's day
to day commercial activities, neither party shall (and EVI shall ensure
that NRC shall not) disclose the terms of this Agreement nor issue any
promotional material or other public announcement or disclosure in
respect to the existence or nature of the relationship between PLL, EVI
and NRC without the prior approval of all of such persons in writing.
Specific secrecy obligations
42.0 Each of the Parties shall (and EVI shall ensure that NRC shall):
42.1 Treat as confidential and keep absolutely secret, all the
Confidential Information received by it from the other party;
42.2 Take all proper and effective precautions to prevent the
disclosure of the Confidential Information and to preserve the
secrecy and confidentiality of the Confidential Information
including, without limitation, taking all necessary action to
prevent unauthorised persons from obtaining access to the
Confidential Information whether by a direct or indirect
exposure to it or otherwise;
42.3 Take all reasonable steps to ensure that its employees or
agents also observe the secrecy requirements of this
Agreement; and
42.4 Return to the owner all physical or written records containing
the Confidential Information or documentation relating to or
concerning the Confidential Information including copies of
documentation then in existence immediately upon the
termination or expiration of this Agreement.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
Circumstances when disclosure of Confidential Information is permitted
43.0 A party is relieved of its obligations to preserve the confidentiality
of the Confidential Information if and only to the extent that:
43.1 Such Confidential Information is or becomes generally publicly
available other than as a result of a breach of this Agreement
by the party, or
43.2 Such Confidential Information was developed independently by
the party; or
43.3 Specific disclosure was required by law.
Best endeavours
44.0 Each of the parties shall do (and EVI shall ensure that
NRC will do) all things necessary to carry out the terms of this
Agreement to the fullest effect in accordance with best business
practice. In particular, each of the parties shall:
44.1 Diligently and fully exploit (or support the exploitation
oo the License Rights under this Agreement; and
44.2 Keep free from conflicting enterprises or any other activities
which would be detrimental to or interfere with the conduct of
this Agreement.
Prohibitions
45.0 None of the parties shall (and EVI shall ensure that NRC shall not):
45.1 Use the Intellectual Property of the other parties except
in the manner permitted in this Agreement;
45.2 Be a party to the doing of any act whereby the goodwill
trade or business of the other party may be prejudicially
affected;
45.3 Hold itself out as an affiliate of the other;
45.4 Pledge the credit of the other party;
Indemnity and Warranties
46.0 Each of the parties unconditionally and irrevocably indemnifies the
other against any loss, liability, costs or expenses which the other
party may incur because it or NRC:
46.1 Fails to pay any moneys due and payable to the other party
(or within any applicable period of grace) or in the manner
required;
46.2 Fails to perform any of its obligations under this
Agreement or under any other contractual arrangement
between it and the other party;
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
46.3 Has infringed the intellectual property rights or any other
person.
And it will on demand pay to the other party the amount of that loss,
liability, cost or expense.
Right to prosecute infringements of the Intellectual Property
47.0 PLL shall have the right under its control and at its own expense to
prosecute any third party infringements of EVI or NRC's Intellectual
Property so long as it is the sole and exclusive licensee of EVI's and
NRC's Intellectual Property. EVI shall cooperate with PLL (and shall
ensure NRC's cooperation) on any action brought by PLL under this
Clause subject only to PLL paying EVI and NRC's reasonable costs.
48.0 Nothing in Clause 47 shall oblige PLL to take any action that it does
not consider to be in its best interests. However, in such
circumstances, EVI may at its discretion and cost, take such action and
any recovery obtained by EVI shall be the property of EVI. PLL shall
cooperate with EVI on any action brought by EVI under this Clause
subject only to EVI paying PLL's reasonable costs.
Termination
49.0 PLL shall have the right to terminate this Agreement at the end of any
Contract Year for any reason upon at least 12 month's written notice to EVI.
50.0 Either Party may elect to terminate this Agreement by giving notice
in writing to the other party of its intention to do so if the other
party:
50.1 Commits a breach of any of the provisions of this Agreement
and fails to rectify the breach (if capable of being
rectified) within 30 days of being required to do so in
writing other than, in the case of PLL, a failure to meet the
target sales as set out in Schedule D;
50.2 Commits an act of bankruptcy or fails to contest within
ten working days of service of any petition in liquidation.
50.3 Becomes the subject of any proceedings to obtain an order
or resolution for its winding up (except as part of a bona
fide reconstruction scheme);
50.4 Has a receiver/manager, official manager or provisional
liquidator appointed over the whole or part of its
undertakings or assets;
50.5 Has an execution or other process of any court or authority or
any distress levied upon any of its property without it being
paid out, set aside or withdrawn within 14 days of its issue;
50.6 Has a substantial part of its assets resumed, confiscated or
forfeited;
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
50.7 Agrees with the other party in writing to terminate this Agreement at
the end of any Contract Year; or
50.8 After remedying any default in respect to which notice requiring it to
remedy such default was given, continues to engage in the same
non-compliance whether or not corrected after such notice.
Consequences of Termination or Expiration
51.0 In the event that this Agreement expires or is terminated:
51.1 All rights of PLL under this Agreement will terminate;
51.2 PLL will forthwith;
(a) Pay to EVI any outstanding Research and Development
Contributions, or fees in respect of R&D, or Royalty
Fees or Minimum Guaranteed Royalty Fees, or charges
due to NRC or EVI at the effective date of
termination or expiration within 30 days of the
effective date of termination or expiration;
(b) Cease to hold itself out as a licensee of the
Licensed Products or Products or that it is
associated with NRC or EVI in any way;
(c) Cease using NRC's or EVI's Intellectual Property and
the Licensed Products or Products except those
Licensed Products or Products jointly owned by PLL;
(d) Return to NRC and EVI all documents and other
material or matters relating to their respective
Intellectual Property and the Licensed Products or
Products except those Licensed Products or Products
jointly owned by PLL.
52.0 Termination or expiration of this Agreement shall be without prejudice
to any claim any party may have against the other or others under this
Agreement as at the date of effective termination or expiration.
General Acknowledgments
53.0 Each of the parties acknowledges that:
53.1 This Agreement contains all the terms conditions and
obligations of the parties.
53.2 It shall make, do perform and execute all documents acts
matters and things required to ensure that no term of this
Agreement shall be breached by it.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
Notices
54.0 Any notice, demand or other document under or relating to this
Agreement will be sufficiently served if delivered personally or if
sent by E-mail, fax,, or prepaid registered letter to the party to be
served at the address of such party at such address as may from time to
time be notified in writing by such party to the other parties.
55.0 Any notice, demand or other document will be deemed to have been served
at the time of delivery or, if service is effected in any other manner
described, at the time when it would in the ordinary course be
delivered.
Amendment
56.0 This Agreement may only be varied by the written agreement of the
parties.
Approvals and consent
57.0 Except when the contrary is stated in this Agreement, a party may give
or withhold an approval or consent to be given under this Agreement in
that party's absolute discretion and subject to those conditions
determined by the respective party.
58.0 A party is not obliged to give its reasons for giving or withholding a
consent or for giving a consent subject to conditions.
Counterparts
59.0 This Agreement may be executed in a number of counterparts and if so
executed, the counterparts taken together constitute one Agreement.
No Waiver
60.0 No failure by a party to exercise any power given to it or to insist
upon the strict compliance by the other or others with any obligations
or conditions and no customary practice of the parties or variances
with the terms of this Agreement shall constitute a waiver of that
party's right to demand exact compliance with the terms of this
Agreement other than in relation to breaches which have been waived nor
shall a waiver by it of any particular default affect or impair its
right in respect of any subsequent default of the same or different
nature, nor any delay or omission by that party to exercise any right
arising from default shall affect or impair its rights as to the said
default or any subsequent default.
Further assurance
61.0 Each party shall promptly execute all documents and do all things that
another party from time to time reasonably requests to effect, perfect
or complete this Agreement and all transactions incidental to it.
Legal costs
62.0 The Parties shall each pay all their own legal and other expenses
relating directly or indirectly to the negotiation, preparation and
execution of this Agreement and all documents incidental to it.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
Severance
63.0 In the event of illegality, each of the terms of this Agreement is
severable from the other terms of this Agreement and the severance of
one term does not affect the other terms.
Dispute resolution
64.0 The parties agree that any dispute arising out of or relating to this
Agreement shall be resolved solely by:
64.1 Negotiation between the chief executive officers of the
parties in good faith discussions, such discussions to be held
within 5 working days of one party notifying the other of a
dispute and the nature of such dispute,
64.2 If the parties fail to resolve the dispute through mediation
within 120 working days, either party shall have the right to
pursue any other remedies available to it.
65.0 Should PLL confirm its wish to take up the License Rights as per this
Agreement, PLL shall, after the Confirmation Date and after receipt of
the sum of $1 to be paid by EVI to PLL, issue to EVI 100,000 fully paid
Class B ordinary shares in the capital of PLL in consideration for the
support provided to PLL by EVI. Such 100,000 fully paid Class B shares
of PLL are as presently constituted, adjusted as appropriate to give
effect to share subdivisions, consolidations, mergers and
amalgamations, stock dividends, distributions in property and other
corporate changes.
66.0 This Agreement shall be governed by the laws of the Province of
Ontario, Canada, except that any questions affecting the construction
or effect of any of the Patents shall be determined by the law of the
country in which the Patent shall have been granted.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
SCHEDULE A
PATENTS
NRC Patent Portfolio
1. LizCrxMn2-xO4 Cathode Materials:
WO 9501935 Jan.19,1995 Novel Materials for Use as Cathodes in Lithium
Electrochemical Cells
CA 2,163,265 Dec. 6, 1994 Novel Materials for Use as Cathodes in Lithium
Electrochemical Cells
US 5,370,949 Dec. 6, 1994 Materials for Use as Cathodes in Lithium
Electrochemical Cells
AU 7,118,294 Feb. 6, 1995 Novel Materials for Use as Cathodes in Lithium
Electrochemical Cells
2. Orthorhombic LiMnO2
WO 9505684 Feb.23,1995 Use of a Stable Form of LiMnO2 as Cathode in Lithium Cell
AU 7,454,894 Mar. 14,1995 Use of a Stable Form of LiMnO2 as Cathode in Lithium
Cell US 5,506,078 Apr. 9,1996 Method of Forming a Stable Form of LiMnO2 as
Cathode in Lithium Cell US 5,629,112 May 13,1997 Stable Form of LiMnO2 as
Cathode in Lithium Cell
(supplements US 5,506,078)
CA 2,163,182 May 18,1997 Use of a Stable Form of LiMnO2 as Cathode in
Lithium Cell
US 5,747,194 May 5, 1998 Use of a Stable Form of LiMnO2 as Cathode in
Lithium Cell (supplements US 5,506,078 and
US 5,629,112)
3. Electrolyte containing chloroethylene carbonate
US 5,529,859 Jun.25,1996 Electrolyte for a secondary cell
US 5,571,635 Nov. 5, 1996 Electrolyte for a secondary cell (continuation
of US 5,529,859)
CA 2,186,273 Apr. 7, 1997 Electrolyte for a secondary cell
4. Electrolyte containing fluoroethylene carbonate
WO 9815024 Apr. 9, 1998 Electrolyte comprising fluoro-ethylene
carbonate and propylene carbonate, for
alkali metal-ion secondary battery
AU 4,374,097 Apr. 24, 1998 Electrolyte comprising fluoro-ethylene
carbonate and propylene carbonate, for
alkali metal-ion secondary battery
5. Patent application to be filed by 15 October 1999
Patent to be filed by 15 October 1999 which
includes cathode inventions made up to and
including 31 March 1999 and which is a
joint invention by NRC and Samsung Advanced
Institute of Technology.
6. Patent application to be filed in conjunction with PLL
Patent application to be filed in
conjunction with PLL to include any arising
IP from I April 1999 related to cathode
materials and/or process development
improvements.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
SCHEDULE B
RESEARCH AND DEVELOPMENT PROGRAM
Development of Commercial LixCryMnzO2 Cathode Materials
Timescale:
9 months
Overall goal:
To prepare reproducible pilot plant batches (200 kg) of LixCryMnzO2 -based
cathode material meeting or exceeding the following market-driven requirements:
200 mAh/g capacity at 25 oC using a 0.2C rate
140 mAh/g capacity at -20 oC using a 0.2C rate
capacity at IC rate >90% of capacity at 0.2C rate
maximum charging voltage of 4.3 V
smooth discharge curve between ca. 4.2 and 2.8 V
fade rate < 10% at 55 oC over 100 cycles
safety better than LiCoO2
cost of production lower than LiCO02
Core personnel resources:
NRC
▇▇▇ ▇▇▇▇▇▇▇▇ (Project Manager for NRC)
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (Senior Research Officer) 75%
Yves Grincourt (Research Assistant - Electrochemical) 75%
Post-doctoral fellow 100%
Technical Officer 1 100%
Technical Officer 2 100%
PLL
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (Project Manager for PLL)
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (Materials Development) 75%
Research Scientist (Materials Development) 75%
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ (Electrochemical) 60%
Research Technician 1 (Synthetic) I 00%
Research Technician 2 (XRD - structural analysis) 75%
Research Technician 3 (Electrochemical) 90%
Research Technician 4 (Electrochemical) 90%
▇▇▇▇▇ ▇▇▇▇▇▇▇ (Process Engineering) 75%
Process Engineer 100%
Process Technician 1 100%
Process Technician 2 100%
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
This project will be jointly managed between NRC and PLL. NRC's representative
will be ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ and PLL's representative will be ▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇. ▇▇
▇▇▇▇▇▇▇▇ will be responsible for work performed at NRC, ▇▇ ▇▇▇▇▇▇▇▇▇ will be
responsible for work performed at PLL
Laboratory and equipment resources:
NRC
Preparative labs
Laboratory furnaces
Benclitop spray dryer
Electrochemical testing facility
AC impedance spectrometer
X-ray diffraction (XRD)
Thermal analysis (TGA-DSC)
Accelerated rate calorimeter (ARC)
AA
BET surface area
Particle sizer
Gas pycnometer
Scanning electron microscope (SEM)
X-ray photoelectron spectrometer (XPS)
PLL
Preparative labs
Laboratory furnaces
Large-scale furnaces
Electrochemical testing facility
AC impedance spectrometer
X-ray diffraction
AA and ICP
High-resolution SEM (University of Auckland)
Program
The program is divided into inter-related tasks. Each task has well-defined
objectives and to each task are assigned persons who will be overall responsible
for guiding and coordinating the task to ensure that the objectives are met
within the timescale, and that relevant information is communicated to those
responsible for related tasks. While responsibility for individual tasks has
been assigned variously to the NRC and PLL, it is nonetheless envisaged that
work will be cooperative with contributions from both parties to all tasks.
For approximately the first half of the program, a strong effort at both centres
will be directed toward materials development at the laboratory scale and
electrochemical test cell development. In the second half of the program,
resources at PLL will be more focussed on scale-up of process and production,
with the NRC both contributing to this and continuing materials development.
Task 1: Develop compositions
Coordinators ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (NRC) & ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (PLL)
Key objectives:
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
Prepare LivCryMnzO2-based compounds with controlled composition and
particle size/structure designed to exceed the minimum market-defined criteria
for rate-related capacity and stability of capacity.
Determine the best composition for scale-up and commercialisation. Work
plan
1.1 Establish chemical composition range for material
PLL to reproduce LixCro.5Mno.502 by coprecipitation, and to optimise
coprecipitation procedure (including temperature/time/gas requirements for
subsequent processing) to produce material showing equivalent or better
electrochemical properties compared with spray-dried samples.
NRC to optimise spray-drying procedure (including
temperature/time/atmosphere requirements for subsequent processing). (126500.1)
Parallel exploration of varying composition using spray drying (NRC)
and copi-ecipitation (PLL).
1.2 Establish influence of synthesis route and conditions
Simplify synthetic procedure
investigate formation and stability of compositions as a function of
temperature/time/atmosphere.
analysis of each process step by XRD, AA and TGA
Investigate alternative process routes using readily available dry
precursors.
1.3 Investigate alternative formulations
Investigate partial and total substitution of Cr by Ni, Fe, Co, Ti, V
or Al.
Task 2: Examine crystal structure and particle morphology Coordinators ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ (NRC) & ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (PLL) Key objectives:
Obtain data relevant to Task I and feed back to Task I observations and
correlations in combination with electrochemical data from Task 3.
Work plan
2.1 Determine effect of composition on crystal structure
XRD
2.2 Determine effect of synthesis route and reaction conditions on crystal
structure and particle morphology
XRD, SEM, particle size analysis, BET, oxidation state analysis
2.3 Determine influence of alternative formulations on crystal structure
and phase stability
XRD
Task 3: Electrochemical characterisation and testing of samples Coordinators
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ (PLL) & Yves Grincourt (NRC) Key objectives:
Obtain data relevant to Task 1 and feed back to Task 1 observations and
correlations in combination with structural/morphological data from Task 2.
Agreement for Research, Development and Licensing of Technologies, dated October
13, 1999
Work plan
3.1 Establish reproducibility of electrochemical data between NRC and PLL.
Optimise electrode formulation and cell configuration.
Exchange of electrodes, cells, and cell hardware between NRC and PLL
3.2 Optimisation of test cell assembly
Investigate electrochemical conditions to increase rate-related capacity
and minimise capacity fade
Optimise stack pressure
Optimise for Li metal and Carbon anodes
3.3 Investigation of intercalation mechanisms and rate-limiting factors
In-sit pulse experiments on different time scales during
charge-discharge
AC impedance specroscopy
dQ/dV plots
XRD, chemical analysis, and thermal stability of cycled materials at
various states of charge and as a function of first charge conditions
3.4 Extended cycling tests
Determine influence of composition and synthesis conditions on temperature-
and rate-related capacity, and on cycling stability.
Task 4: Develop synthetic procedures toward production process Coordinator ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ (PLL) Key objectives: (126500.1) Reproduce compounds prepared in Task
1 (retaining electrochemical performance characteristics) using commercially
viable synthesis procedures streamlined toward scale-up and production.
Task 5: Scale-up trials (100 g to 5 kg)
Coordinators ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (PLL)
Key objectives:
Prepare LixCryMnzO2 -based compounds developed in Task 1(and Task 9) as
reproducible 100g and 5 kg batches.
Task 6: Scale up to 100 T per annum pilot plant
Coordinator ▇▇▇▇▇ ▇▇▇▇▇▇▇ (PLL)
Key objectives:
Produce reproducible 200 kg batches of the selected material
(retaining electrochemical performance characteristics of the small
batch samples) in the pilot plant.
Task 7: Verify reproducibility of composition, structure & morphology for
scale-up samples Coordinators ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (NRC) & ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (PLL)
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
Key objectives:
Obtain data for samples produced in Tasks 5 & 6 and feed back to Tasks
5 & 6 observations and correlations.
Task 8: Electrochemical testing of scale-up samples
Coordinator ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ (PLL)
Key objectives:
Obtain data for samples produced in Tasks 5 & 6 and feed back to Tasks
5 & 6 observations and correlations.
Work plan
8.1 Extended cycling tests
Determine reproducibility and influence of synthesis conditions on
temperature- and rate-related capacity, and on cycling stability.
Task 9: Continued material development to enhance properties Coordinator ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ (NRC) Key objectives: (126500.1) Continue development of
LixCryMnzO2-based compounds to further improve electrochemical characteristics
after achievement of initial performance goals.
Feed new developments into the loop of scale-up to commercial product.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
SCHEDULE C
ROYALTY FEES
Royalty Fees of each Contract Year to be calculated as:
a) 33% of the license or other fees earned by PLL from the sub-licensing to a
third party of the rights to the Licensed Products or Products whether
such fees are paid by the sub-licensee in one sum or by installments, and
b) 4% of Net Sales where Licensed Products or Products are manufactured by
PLL, any related party of PLL or by any other party.
PROVIDED THAT
1) When the amount of Royalty Fees payable by PLL to EVI re any Contract Year
reaches the higher of $1 million or the Minimum Guaranteed Royalty Fees for that
Contract Year, the percentage of the license fees payable by PLL to EVI under
paragraph a) above shall then reduce from 33% to 25% on the balance of the
license fees upon which Royalty Fees are payable to EVI during that Contract
Year; and
2)"Net Sales" shall mean gross sales of Licensed Products or Products
less sales taxes, freight, insurances, reasonable sales persons' or agents'
commissions and packaging costs: and
3) In the event that PLL or any related party of PLL uses the Licensed Products
or Products in its manufacture of cells or batteries, the Royalty Fees payable
to EVI shall be the higher of (1) 4% of the best price that PLL or any related
party of PLL or any licensed manufacturer of the Licensed Products or Products
sells the Licensed Products or Products calculated on the Licensed Products or
Products used by PLL or any related party of PLL in its manufacturing process,
or (2) 1 % of the Net Sales of cells or batteries utilising the Licensed
Products or Products which are sold by PLL or any related party of PLL.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
SCHEDULE D
Target Sales
Period or Contract Year Guaranteed cell volumes Cell value based on the Minimum Guaranteed Royalty
ending 31 March containing licensed cathode. Guaranteed Cell volumes at a Fees based on cell cost of
(See Note 1 below) cost of $2.00 per cell. $2.00 per cell (See Note 1
(See Note 1 below) below)
2000 Nil Nil $200,000
2001 Nil Nil $100,000
2002 500,000 $1,000,000 $100,000
2003 5,000,000 $10,000,000 $200,000
2004 10,000,000 $20,000,000 $400,000
2005 25,000,000 $50,000,000 $1,000,000
2006 50,000,000 $100,000,000 $2,000,000
2007 75,000,000 $150,000,000 $3,000,000
2008 and thereafter (See Note 2 below) (See Note 2 below) (See Note 2 below)
Notes:
1. An indicative cell cost value of $2.00 per cell has been used in
calculating the Minimum Guaranteed Royalty Fees. If the cell cost
values reduce to below $2.00 per cell and there is no corresponding
increase in the sale volumes of the cells so that the Minimum
Guaranteed Royalty Fees are achieved, then the parties shall negotiate
in good faith to either reduce the Minimum Guaranteed Royalty Fees or
to convert this Agreement to a non-exclusive arrangement. The term
"cost" means the aggregate of the raw materials cost, costs of
conversion and other costs including production overheads incurred in
the manufacture of the cell.
2. The above targets shall, in Contract Years ending 31 March 2008 and
later, increase each Contract Year by a percentage equivalent to the
overall world market $ of sales increase of similar Products, applied
to the previous Contract Year's actual values.
This is the final page of the Agreement.
Agreement for Research, Development and Licensing of Technologies, dated
October 13, 1999
