Item 1.01.Entry into a Material Definitive Agreement.
Amendment No. 2 to Joint Development Agreement between FuelCell Energy, Inc. and ExxonMobil Technology and Engineering Company (f/k/a ExxonMobil Research and Engineering Company)
On April 29, 2022, FuelCell Energy, Inc. (the “Company”) and ExxonMobil Technology and Engineering Company (f/k/a ExxonMobil Research and Engineering Company) (“EMTEC”) entered into Amendment No. 2 to the Joint Development Agreement between the Company and EMTEC (“Amendment No. 2”), effective as of April 30, 2022.
The Joint Development Agreement between the Company and EMTEC (the “Original Agreement”) was executed on November 5, 2019, was effective as of October 31, 2019, and had a term of two years from the effective date, ending on October 31, 2021. Under the Original Agreement, the Company has engaged in exclusive research and development efforts with EMTEC to evaluate and develop new and/or improved carbonate fuel cells to reduce carbon dioxide emissions from industrial and power sources in exchange for (i) payment by EMTEC of certain fees and costs (including research costs of up to $45,000,000) as well as certain milestone-based payments, and (ii) certain licenses, in each case as described in the Original Agreement. The terms of the Original Agreement are described more fully in the Current Report on Form 8-K filed by the Company on November 6, 2019.
In Amendment No. 1 to the Joint Development Agreement (“Amendment No. 1”), which was executed on October 29, 2021 and effective as of October 31, 2021, the Company and EMTEC agreed, among other things, to extend the term for an additional six months, ending on April 30, 2022. Amendment No. 1 allowed for the continuation of research intended to enable incorporation of design improvements to Company fuel cell design in order to support a decision to use the improvements in a future demonstration of the technology for capturing carbon at ExxonMobil’s Rotterdam refinery in the Netherlands (such demonstration, the “Rotterdam Project”) and provided additional time to achieve Milestone 1, as defined in the Original Agreement. The terms of Amendment No. 1 are described more fully in the Current Report on Form 8-K filed by the Company on November 2, 2021.
In Amendment No. 2, the Company and EMTEC agreed to further extend the term such that it will end on December 31, 2022 (unless terminated earlier) and to increase the maximum amount of research costs to be reimbursed by EMTEC from $45,000,000 to $50,000,000. Amendment No. 2 allows for the continuation of research that would enable the parties to (i) gain an improved understanding of the fuel cell operating envelope for various carbon capture applications; and (ii) complete data collection to support the project gate decision to use the developed technology in a Company fuel cell module demonstration for capturing carbon at ExxonMobil’s Rotterdam facility. In Amendment No. 2, the Company and EMTEC also agreed to conduct a joint market study, with a target completion date on or before October 31, 2022, to (a) define application opportunities, commercialization strategies, and development requirements, (b) identify partners for potential pilot/demonstration projects and (c) assess fuel cell/stack/module manufacturing scale-up and cost reduction.
The foregoing summary of the terms of Amendment No. 2 is qualified in its entirety by reference to the full text of Amendment No. 2, a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Other Material Relationships with ExxonMobil Technology and Engineering Company
In addition to the Original Agreement (as amended by Amendment No. 1 and Amendment No. 2), in June 2019, the Company and EMTEC entered into a license agreement to facilitate the further development of the Company’s SureSource CaptureTM product. Pursuant to this license agreement, the Company granted EMTEC and its affiliates a non-exclusive, worldwide, fully-paid, perpetual, irrevocable, non-transferable license and right to use the Company’s patents filed on or before April 30, 2021, and any data, know-how, improvements, equipment designs, methods, processes and the like provided directly by the Company or its affiliates to EMTEC or its affiliates under any agreement or otherwise, on or before April 30, 2021, to the extent it is useful to research, develop and commercially exploit carbonate fuel cells in applications in which the fuel cells concentrate carbon dioxide from industrial and power sources and for any other purpose attendant thereto or associated therewith.
This license agreement is being described only for the purpose of describing the material relationships between the Company and EMTEC and is not impacted by Amendment No. 2.
