Exhibit 10.24
AMENDED AND RESTATED
AGREEMENT
by and between
JDS FITEL INC.
and
OPTICAL COATING LABORATORY, INC.
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS......................................... 1
ARTICLE II
SCOPE OF RELATIONSHIP............................... 4
ARTICLE III
MANUFACTURE OF WDM PRODUCTS......................... 5
3.1 Manufacture of WDM Optical Filters by
OCLI...................................... 5
3.2 Supply of WDM Products by JDS............. 5
3.3 Supply of WDM Optical Filters............. 6
3.4 Price for JDS's Services.................. 6
3.5 Terms and Conditions...................... 6
3.6 Licensing and Technology.................. 6
3.7 Marking of WDM Products................... 8
ARTICLE IV
DISTRIBUTION AGREEMENT.............................. 8
ARTICLE V
USE OF THIRD PARTY WDM OPTICAL
FILTER AND ASSEMBLY SERVICES SUPPLIERS.............. 8
5.1 Price Competition......................... 8
5.2 Competition Other Than Price.............. 9
5.3 Price of Third Party Filters or
Services Included in Costs................ 9
ARTICLE VI
PROFIT SHARING...................................... 9
6.1 Quarterly Profit Sharing Adjustments...... 9
6.2 Profit Sharing for Non-Optical Filer
WDM Product A, B and C.................... 10
6.3 Profit Sharing for Non-Optical Filer
WDM Product D............................. 10
6.4 Profit Sharing for WDM Product D
JDS Fiber Amps............................ 11
6.5 Right to Inspect and Audit Records........ 11
6.6 Audit Costs Necessitated by
Agreement................................. 11
ARTICLE VII
FORMATION OF JOINT VENTURE COMPANY.................. 12
7.1 Option to Form Joint Venture Company...... 12
7.2 Formation of Joint Venture Company........ 12
7.3 Assignment of Distribution Agreement...... 13
7.4 Assignment of Terms of the Agreement...... 13
7.5 Activities of the Company................. 13
7.6 Failure to Agree on Terms of the
Company................................... 14
ARTICLE VIII
EXCLUSIVITY......................................... 14
8.1 Scope of Exclusive Rights................. 15
ARTICLE IX
TERMINATION......................................... 15
9.1 Termination for Convenience by Either
Party..................................... 15
9.2 Effect of Termination..................... 15
ARTICLE X
MANAGEMENT COMMITTEE................................ 16
10.1 Management Committee...................... 16
10.2 Chairperson of the Management
Committee................................. 16
10.3 Delegation................................ 17
10.4 Business Plan............................. 17
ARTICLE XI
RESEARCH AND DEVELOPMENT............................ 17
11.1 Funding of R&D............................ 17
ARTICLE XII
THIRD PARTY LICENSING............................... 18
ARTICLE XIII
ACQUISITIONS........................................ 18
ARTICLE XIV
CONFIDENTIAL INFORMATION............................ 19
ARTICLE XV
MISCELLANEOUS....................................... 22
15.2 Order Backlog............................. 22
15.3 Constraints on Employee Transfers......... 22
15.4 Governing Law............................. 23
15.5 Disputes.................................. 23
15.6 Attorneys' Fees........................... 24
15.7 Notices................................... 24
15.8 Public Announcements...................... 25
15.9 Counterparts.............................. 26
15.10 Interpretation............................ 26
15.11 Successors and Assigns.................... 26
15.12 Waiver.................................... 26
15.13 Purchase by Competitor.................... 26
15.14 Entire Agreement.......................... 27
15.15 Agency.................................... 27
15.16 Survival.................................. 27
15.17 Further Assurances and Approvals.......... 28
15.18 Intellectual Property Indemnity
Liability................................. 28
15.19 Approvals................................. 28
15.20 Representations and Warranties............ 28
15.21 Force Majeure............................. 29
AMENDED AND RESTATED
AGREEMENT
THIS AMENDED AND RESTATED AGREEMENT, made as of this 15th
day of April, 1999, by and between JDS FITEL Inc., a Canadian
corporation, having its principal place of business at 570 West
Hunt Club Road, Nepean, Ontario K2G 5W8 Canada ("JDS" and
"Distributor") and OPTICAL COATING LABORATORY, INC., a Delaware
corporation, having its principal place of business at 2789
Northpoint Parkway, Santa Rosa, California 95407-7397 ("OCLI").
W I T N E S S E T H :
WHEREAS, JDS and OCLI entered into an agreement dated
February 1, 1997 to combine their respective areas of expertise
and capabilities in a joint effort for WDM Product Business as
defined therein;
WHEREAS, the parties agree that the WDM Business shall be
managed with the intent to make profits; and
WHEREAS, JDS and OCLI wish to expand their joint efforts in
the WDM Business by amending and restating their agreement as set
forth herein.
NOW, THEREFORE, in consideration of the mutual promises
contained herein, the parties hereto agree to the following:
ARTICLE I
DEFINITIONS
1.1 Definitions. For purposes of this Agreement, the
following definitions shall apply:
"Company" shall have the meaning as set out in Section 7.1.
"Company Profit" with respect to the Company shall mean the
Company's revenues, including from transactions with the
Distributor or with any party to this Agreement, from the WDM
Products Business, including related activities such as licensing
of WDM Product or WDM Optical Filter technology, pursuant to this
Agreement less Company related Costs. "Company Profit" can be
either a profit or a loss.
"Confidential Information" shall have the meaning as set out
in Section 14.1.
"Cost" shall be defined as set forth in Exhibit A attached
hereto.
"Fiscal Year" shall mean a 12-month period of time ended
October 31. "Fiscal Quarter" shall mean the quarters ended
January 31, April 30, July 31 and October 31.
"Management Committee" shall have the meaning as set out in
Section 10.1.
"Non-assignable" shall mean personal, non-transferable,
indivisible and non-assignable.
"OCLI Customer" shall mean a single customer as determined
by the Management Committee.
"Passive" shall mean not electrically powered or
electrically controllable or adjustable.
"Planar Waveguides" shall mean planar waveguides performing
a wavelength discrimination function.
"Profit" shall mean the sum of the Transaction Profit of
each party plus Company Profit. "Profit" can be either a profit
or a loss.
"Transaction Profit" with respect to any party shall mean
that party's revenues, including from transactions with the
Company or with other parties to this Agreement from the WDM
Products Business, including related activities such as licensing
of WDM Product or WDM Optical Filter technology, pursuant to this
Agreement less such party's related Costs. "Transaction Profit"
can be either a profit or a loss. For greater certainty,
Transaction Profit shall not include any revenue, Costs or Company
Profit recognized by either party as a result of either
consolidating, equity accounting or cost accounting for a party's
ownership interest share in the Company.
"WDM Optical Filters" shall mean WDM Optical Filters A, WDM
Optical Filters B, WDM Optical Filters C and WDM Optical Filters
D.
"WDM Optical Filters A" shall mean any and all dielectric
(thin film) optical filters that are intended to be used in WDM
Products A.
"WDM Optical Filters B" shall mean any and all dielectric
(thin film) optical filters that are intended to be used in WDM
Products B.
"WDM Optical Filters C" shall mean any and all dielectric
(thin film) optical filters that are intended to be used in WDM
Products C.
"WDM Optical Filters D" shall mean any and all dielectric
(thin film) optical filters that are intended to be used in WDM
Products D.
"WDM Products" shall mean (a) WDM Products A and WDM
Products B, having three (3) or more fiber-coupled ports, (b) WDM
Products C and WDM Products D having only two (2) fiber-coupled
ports. For greater certainty where a WDM Product is combined with
or integrated into another device which provides additional
features or functions not essential to the operation of the WDM
Product, including without limitation amplification, switching or
adjustable attenuation, the value of the WDM Product shall be
considered to be the fair market value of the WDM Product by
itself without including any of the value of the remainder of the
device.
"WDM Products A" shall mean Passive wavelength division
multiplexing or de-multiplexing components of four or more
channel capability using optical filters or some other form of
wavelength discrimination.
"WDM Products B" shall mean Passive wavelength division
multiplexing or de-multiplexing components using optical filters
or some other form of wavelength discrimination with all operating
channels within the wavelength range of 1500 to 1580 nanometers
and with eighty percent (80%) transmission bandwidth greater than
fourteen (14) nanometers.
"WDM Products C" shall mean Passive wavelength division de-
multiplexing components using optical filters or some other form
of wavelength discrimination with one fixed, non-adjustable
passband, within the wavelength range of 1500 to 1580 nanometers,
having an eighty percent (80%) transmission bandwidth which is
within a one percent (1%) transmission bandwidth of less than or
equal to four (4) nanometers.
"WDM Products D" shall mean Passive gain equalization
components using optical filters or some other form of wavelength
discrimination designed to match the spectral characteristics to
an ideal optical spectrum for optical amplifier gain flattening
applications over a specified optical bandwidth of at least six
nanometers.
"WDM Product Business" shall mean the business of design,
development, manufacture, supply of WDM Optical Filters or WDM
Products, sales to Distributor and technical product marketing
support to assist Distributor in sales and marketing of WDM
Products, all related to WDM Optical Filters or WDM Products.
ARTICLE II
SCOPE OF RELATIONSHIP
2.1 The relationship created between JDS and OCLI as
described in more detail herein encompasses a joint venture
activity relating to the design and manufacture of WDM Optical
Filters; the design and manufacture of WDM Products; and the
marketing and sale of WDM Products. From this joint venture
activity JDS will realize two-thirds of all Profits for WDM
Products A, B and C and OCLI will realize one-third of all such
Profits, and JDS will realize one-half of all Profits for WDM
Products D and OCLI will realize one-half of all such Profits, all
subject to adjustment and the provisions as set forth herein. The
activities for the design, test and manufacture of WDM Optical
Filters are to be provided by OCLI and the design, assembly, test
and manufacture and test of WDM Products are to be provided by JDS
and upon the occurrence of certain circumstances as set out
herein, these activities may be transferred to a separate legal
entity. Furthermore, each party will cross-license intellectual
property to the other party as set forth herein. JDS shall be the
exclusive entity through which WDM Products from this joint
venture activity are sold and JDS will perform all marketing and
sales activities for WDM Products, with technical assistance from
OCLI as set out herein. OCLI may perform marketing and sales
activities for WDM Products D solely to the OCLI Customer.
OCLI represents that it has expertise in optical coating
technology and optical design capabilities for making optical
filters and is currently developing technology to address current
and future market demands for telecommunications applications.
JDS represents that it has know-how and expertise in fiber optic
component technology including packaging and development, design
and test, and manufacturing capabilities for fiber optic
components, including WDM Products, for telecommunications
applications, and is currently developing technology to address
current and future market demands for telecommunications
applications, and also has marketing and sales expertise relating
to such optical components. At least until the establishment of
the Company, it is intended that OCLI will use its expertise and
facilities for manufacturing WDM Optical Filters for the joint
venture, and JDS will use its expertise and facilities for
manufacturing WDM Products for the joint venture.
ARTICLE III
MANUFACTURE OF WDM PRODUCTS
3.1 Manufacture of WDM Optical Filters by OCLI. Subject to
Section 7.5, OCLI agrees to commit all resources necessary and
appropriate to provide manufacturing services to manufacture and
supply WDM Optical Filters for use by JDS or the Company in WDM
Products which are based on Distributor's customer requirements
which have been translated into product, proof of concept product
or prototype product specifications by Distributor where the
required WDM Optical Filters specifications have been determined
in consultation with OCLI with respect to WDM Optical Filters
provided by OCLI. For greater certainty, JDS may also make and
supply WDM Optical Filters for use in WDM Products, subject to
Management Committee review based on the cost, available
technology or capacity relating to WDM Optical Filters.
3.2 Supply of WDM Products by JDS. Subject to Section 7.5,
JDS agrees to commit all resources necessary and appropriate to
provide services to design, assemble, test and supply to OCLI as
required by OCLI or the Company WDM Products which are based on
Distributor's customer requirements which have been translated
into product, proof of concept product or prototype product
specifications by Distributor in consultation with JDS with
respect to WDM Products provided by JDS.
3.3 Supply of WDM Optical Filters. Prior to formation of
the Company, OCLI shall provide WDM Optical Filters to JDS as
customer furnished material for use in the manufacture of the WDM
Products unless JDS has manufactured filters for use in WDM
Products D under license from OCLI pursuant to Section 3.6.
3.4 Price for JDS's Services. Prior to formation of the
Company, and subject to Section 6.1 JDS shall charge OCLI for the
design, assembly and testing of the WDM Products at JDS's Cost to
design, assemble and test the WDM Products plus a percentage mark
up fee of such Cost as agreed by the Management Committee. JDS
shall invoice OCLI for WDM Products for which testing has been
completed and are ready for shipment to Distributor or
Distributor's customers.
3.5 Terms and Conditions. Payment terms for the sale of
WDM Products and services by JDS to OCLI shall be net 45 days from
the date of invoice. All payments not received when due shall be
subject to an additional charge of 1.5% per month of the unpaid
amount until the date of payment.
3.6 Licensing of Technology. Subject to Section 11,
Section 13 and subsection (d) below and a Business Plan approved
by the Management Committee, where a particular WDM Optical
Filters D or WDM Product D, is commercially manufacturable as
determined by the Management Committee, and where the Management
Committee has determined that it is in the best interests of the
joint venture that OCLI may also manufacture such WDM Product D
("Approved WDM Product D") or that JDS may also manufacture such
WDM Optical Filters D ("Approved WDM Optical Filters D"), then:
(a) License: OCLI and JDS shall each license the other on
a royalty free, nonexclusive, Non-assignable basis
all intellectual property rights, excluding
trademarks, service marks and tradenames, owned by
the other party and utilized by such party in the
manufacture, (including the design of the Approved
WDM Optical Filters D or Approved WDM Products D to
be manufactured) of Approved WDM Optical Filters D in
the case of OCLI, and of Approved WDM Products D in
the case of JDS ("Licensed IP"). Except as set forth
in subsection (e) below, the parties agree that
Licensed IP can only be used for the manufacture of
Approved WDM Optical Filters D in the case of JDS,
and Approved WDM Products D in the case of OCLI, and
for no other purpose.
(b) Technical Assistance: OCLI and JDS shall at such
party's Cost provide technical assistance to the
other party that the furnishing party considers
reasonably necessary relating to Licensed IP and at
mutually agreeable times so as not to adversely
affect either party's own operations and to help such
other party to manufacture Approved WDM Optical
Filters D in the case of JDS, and Approved WDM
Products D in the case of OCLI ("Technical
Assistance"). The cost of providing Technical
Assistance, and all other costs incurred by a party
under this Section 3.6 relating to licensing, shall
be included in the Costs of the joint venture.
(c) Subsidiary Intellectual Property: At the date when a
particular WDM Optical Filters D or WDM Products D
becomes Approved WDM Optical Filters D or Approved
WDM Products D, intellectual property rights owned by
either party's subsidiaries in which the party has
majority ownership and where the party has control to
cause said subsidiaries to grant an intellectual
property rights license relating to the Approved WDM
Optical Filters D or Approved WDM Products D which is
necessary to enable the joint venture to conduct WDM
Product Business, shall be offered to the other party
on a nonexclusive, Non-assignable royalty free basis
if possible, or failing which on a commercially
reasonable basis. Where either party subsequently
attains a majority ownership and where the party has
control to cause said subsidiaries to grant an
intellectual property rights license relating to the
Approved WDM Optical Filters D or Approved WDM
Products D which is necessary to enable the joint
venture to conduct WDM Product Business, the party
shall offer to the other party on a nonexclusive,
Non-assignable royalty free basis if possible, or
failing which on a commercially reasonable basis,
such subsidiaries' intellectual property at the date
such party attains such position.
(d) Improvements: Each party agrees to license back all
improvements made to Licensed IP to the other party
on a royalty free, nonexclusive, assignable basis.
(e) Notwithstanding the foregoing, OCLI shall be allowed
to design, develop, manufacture and sell WDM Product
D only to the OCLI Customer using only a JDS designed
commercially manufacturable WDM Product D where the
license granted under Section 3.6(a), the technical
assistance required under Section 3.6(b) and the
rights granted under Sections 3.6(c) and (d) shall
cover such activity by OCLI related solely to the
manufacture of the JDS designed commercially
manufacturable WDM Product D, whether or not such WDM
Products D sold to the OCLI Customer are Approved WDM
Products D.
3.7 Marking of WDM Products. All WDM Products D
manufactured and sold pursuant to this Agreement, and all
technical and marketing literature, shall be marked with the names
and trademarks of both JDS and OCLI as determined by the
Management Committee. WDM Products A, B and C shall also be
marked as required by the Distribution Agreement.
ARTICLE IV
DISTRIBUTION AGREEMENT
4.1 Contemporaneously with the execution of this Agreement,
OCLI and Distributor shall enter into that certain Distribution
Agreement attached hereto as Exhibit B pursuant to which OCLI
shall sell WDM Products only to Distributor as the sole and
exclusive distributor of WDM Products at a price equal to OCLI's
Cost of WDM Products plus a percentage mark up fee of such Cost as
agreed by the Management Committee; notwithstanding the foregoing,
OCLI may sell WDM Products D only to the OCLI Customer directly.
ARTICLE V
USE OF THIRD PARTY WDM OPTICAL
FILTER AND ASSEMBLY SERVICES SUPPLIERS
5.1 Price Competition. The Management Committee may decide
whether JDS, in the case of purchase WDM Optical Filters, or OCLI,
in the case of WDM Products assembly Services, or the Company for
both, may purchase WDM Optical Filters or WDM Products assembly
Services from third parties (where third parties in this Agreement
shall include non-wholly owned subsidiaries of either party) if it
determines that the Profits would be greater.
5.2 Competition Other Than Price. In the event that OCLI,
in the case of WDM Optical Filters, JDS, in the case of WDM
Products assembly Services or the Company for both, is unable to
provide WDM Optical Filters or WDM Products assembly Services, as
required by Distributor's customers, based on lack of technology,
including but not limited to capacity, yield or delivery
timeframes, the Management Committee may authorize JDS, in the
case of WDM Optical Filters, OCLI, in the case of WDM Products
assembly Services, or the Company for both to purchase WDM Optical
Filters or WDM Products assembly Services from third parties.
5.3 Price of Third Party Filters or Services Included
in Costs. In the event WDM Optical Filters or WDM Product
assembly services are purchased from third parties pursuant to
Section 5.1 or 5.2, the price paid for such filters or such
services are to be included in Costs for the purpose of
determining profit sharing under Article VI.
ARTICLE VI
PROFIT SHARING
6.1 Quarterly Profit Sharing Adjustments. Within 30 days
from the end of each Fiscal Quarter thereafter, OCLI, JDS,
Distributor and the Company when formed will exchange accounting
information regarding each party's respective Costs incurred and
Profits realized from the WDM Products Business. The sale price
of WDM Products from OCLI or the Company to Distributor under the
Distribution Agreement or alternately prior to formation of the
Company the mark-up fee under Section 3.4, shall be adjusted such
that the portion of Profits realized by OCLI are equal to one-
third for WDM Products A, B and C and one-half for WDM Products D
and the portion of Profits realized by JDS and Distributor
combined are equal to two-thirds for WDM Products A, B and C and
one-half for WDM Products D, of the Profits realized pursuant to
the terms of this Agreement, subject to adjustment under Sections
6.2 and 6.3, and the provisions of Section 6.4. The profit sharing
adjustment of each party's portion of Profits shall be made
retroactively for the Fiscal Quarter just ended in the form of a
credit from one party to the other and prospectively such that the
profit sharing expected for the current Fiscal Quarter will
conform to the requirements of this section.
6.2 Profit Sharing for Non-Optical Filter WDM Product A, B
and C. In the event the amount of sales of WDM Products A, B and
C by Distributor that incorporate means of wavelength selection
other than WDM Optical Filters A, B and C or other elements
providing means of wavelength discrimination which all have
originated from OCLI during any Fiscal Quarter constitute more
than 50% of the amount of all sales of WDM Products A, B and C by
Distributor, then the adjustment called for by Section 6.1 shall
be such that the portion of Profits realized by OCLI are equal to
one-quarter and the portion of Profits realized by JDS and
Distributor combined are equal to three-quarters of the Profits
realized pursuant to the terms of this Agreement. In the case of
WDM Products A, B and C containing both WDM Optical Filters A, B
and C and other means of wavelength selection, sales by
Distributor shall be allocated to WDM Products A, B and C sales in
accordance with the relative value of the WDM Optical Filter A, B
and C elements or other elements providing means of wavelength
discrimination which all have originated from OCLI to the total
value of all wavelength selection elements employed in the WDM
Products A, B and C, as determined by the Management Committee.
Notwithstanding the foregoing, the said other elements providing
means of wavelength discrimination in WDM Products A, B and C
which all have originated from OCLI, shall only be used in the
calculation in this subsection if such elements were not available
from JDS at the time introduced by OCLI.
6.3 Profit Sharing for Non-Optical Filter WDM Product D.
In the event the amount of sales of WDM Products D by Distributor
that incorporate means of wavelength selection other than WDM
Optical Filters D or other elements providing means of wavelength
discrimination which all have originated from OCLI during any
Fiscal Quarter constitute more than 50% of the amount of all sales
of WDM Products D by Distributor, then the adjustment called for
by Section 6.1 for WDM Products D shall be such that the portion
of Profits realized by OCLI are equal to 38%. In the case of WDM
Products D containing both WDM Optical Filters D and other means
of wavelength selection, sales by Distributor shall be allocated
to WDM Products D sales in accordance with the relative value of
the WDM Optical Filter D elements or other elements providing
means of wavelength discrimination which all have originated from
OCLI to the total value of all wavelength selection elements
employed in the WDM Products D, as determined by the Management
Committee. Notwithstanding the foregoing, the said other elements
providing means of wavelength discrimination in WDM Products D
which all have originated from OCLI, shall only be used in the
calculation in this subsection if such elements were not available
from JDS at the time introduced by OCLI.
6.4 Profit Sharing for WDM Product D for JDS Fiber Amps.
Notwithstanding any term to the contrary, for sales of WDM
Product D to JDS as customer for its use in fiber amplifiers
(Fiber Amps), OCLI's share of Profits shall be as follows: 5%
during Fiscal Year 1999; 7.5% during Fiscal Year 2000; 10% during
Fiscal Year 2001; 12.5% during Fiscal Year 2002; and 15%
thereafter. For such sales of WDM Product D to JDS as customer,
the sales price shall be a "best customer" price based on the
sales price for equivalent WDM Product D products on substantially
similar terms to third parties, all as determined by the
Management Committee. For greater certainty JDS as customer may
purchase any or all of its WDM Product D requirements for Fiber
Amps from third parties and all such activities shall be deemed to
be completely outside the scope of this Agreement.
6.5 Right to Inspect and Audit Records. Each party hereto
shall have the right, upon reasonable notice and during normal
business hours, to inspect and conduct an audit of any other
party's or the Company's accounting records for the purpose of
verifying such party's Costs and Profits.
6.6 Audit Costs Necessitated by Agreement. Except for
Section 6.5, in the event a financial audit other than a party's
normal annual or quarterly audit required for its own business, is
required at any time to determine any matter or calculation
hereunder, the costs of such audit shall be included in Costs.
ARTICLE VII
FORMATION OF JOINT VENTURE COMPANY
7.1 Option to Form Joint Venture Company. Subject to
Section 7.2 and only where the sales of WDM Products by
Distributor exceeds forty million dollars ($US40,000,000) for any
four consecutive Fiscal Quarters, either party hereto may exercise
an option to cause to be formed a joint venture company (the
"Company"). Such option shall be exercisable by either party by
giving sixty (60) days written notice thereof to the other party.
7.2 Formation of Joint Venture Company. Prior to either
party exercising the option under Section 7.1, OCLI and JDS shall
upon written notice negotiate in good faith for a period of sixty
(60) days following such notice and agree upon all the terms and
conditions relating to the formation and operation of the
Company, including but not limited to the terms set forth below.
Where the parties are not able to agree on all such terms or
conditions, the terms and conditions the parties have not agreed
upon shall be addressed in accordance with Section 7.6 below.
(a) Form. The Company will be formed as a general
partnership, limited liability company or other "flow-through"
entity in order to minimize or eliminate taxes at the Company
level.
(b) Location. The Company will be located in a location
agreed upon by OCLI and JDS which provides a favorable tax
treatment for all parties, location to competent labor force,
access to markets and convenience to the management of OCLI and
JDS.
(c) Capital. OCLI and JDS will provide capital in the
form of equity or working capital loans on commercially reasonable
terms as needed.
(d) Licensing of Technology. Subject to Sections 11 and
13.1, OCLI and JDS shall license the Company on a royalty free,
nonexclusive, Non-assignable basis all intellectual property
rights, excluding trademarks, service marks and tradenames, owned
by either party for WDM Products Business. OCLI and JDS shall at
no charge provide technical assistance to the Company to help the
Company to implement, and utilize in the Company's WDM Product
Business, such licensed intellectual property rights. Intellectual
property rights owned by either party's subsidiaries in which the
party has majority ownership and where the party has control to
cause said subsidiaries to grant an intellectual property rights
license relating to the WDM Products Business which is necessary
to enable the Company to conduct WDM Product Business, shall be
offered to the Company on a nonexclusive, Non-assignable basis for
a commercially reasonable royalty.
(e) Governance. The governance and control of the Company
will be negotiated by the parties acting in good faith prior to
the exercise of the option under Section 7.1, by taking into
consideration, in addition to all other factors: (i) OCLI's desire
to structure the Company to enable OCLI to consolidate the Company
into its financial statements and (ii) JDS's desire to adequately
address JDS's need to feel comfortable with the fairness and
degree of control it has over the Company by taking into
consideration, in addition to all other factors, JDS's
participation in Profits under this Agreement including its status
as exclusive distributor under the Distribution Agreement.
(f) Profit Sharing. The parties' respective percentage
interest in the earnings and profits of the Company shall be such
as to reflect the sharing of Profits provided for in Article VI of
this Agreement.
7.3 Assignment of Distribution Agreement. Upon formation
of the Company, the Distribution Agreement shall be assigned by
OCLI to the Company.
7.4 Assignment of Terms of the Agreement. The Company,
shall also agree to be bound by the same obligations that JDS and
OCLI have to each other before the formation of the Company that
relate to protecting each party's interests, including but not
limited to, Sections 3.1 and 3.2, Article IV Distribution; Article
VI Profit Sharing; Article VIII Exclusivity; Article IX
Termination; Article XI Research and Development; Article XIII
Acquisitions; Article XIV Confidential Information and Article XV
Miscellaneous.
7.5 Activities of the Company. After the formation of the
Company, the parties shall determine what activities as set out in
Article III shall be assumed by the Company or shall continue to
be provided by one or both of the parties.
7.6 Failure to Agree on Terms of the Company. In the event
the parties do not reach agreement on all the terms and conditions
relating to the formation and operation of the Company within the
60-day notice period or any extensions of time mutually agreed to
by the parties, the parties agree to immediately submit any such
terms and conditions that the parties have failed to agree on to
arbitration pursuant to Section 15.7 except that such arbitration
shall not be binding on the parties save as expressly set out in
this Article VII. The factors set forth in Section 7.2(e)(i) and
(ii) shall not in any manner be disclosed to the arbitrators. The
arbitrators shall determine such terms and conditions taking into
account:
(a) all of the factors listed in Section 7.2 but without any
reference to the factors set forth in Section 7.2(e)(i) and (ii),
(b) other provisions of this Agreement and (c) the conduct of the
parties under this Agreement. The arbitration proceeding shall be
completed within 90 days following the conclusion of good faith
negotiations. After conclusion of the arbitration of all such
terms and conditions that the parties had failed to agree on, and
where OCLI is not satisfied with the arbitrators' decision OCLI
shall have the option, exercisable by notice, given within 30 days
of the date of the arbitrators' decision, to (i) terminate this
Agreement on six months notice provided notice is given after
January 31, 1999, (ii) agree to form the Company upon the terms
decided by the arbitrators if, and only if, JDS also, in its sole
and unfettered discretion, whether or not acting reasonably,
agrees to form the Company upon such terms or (iii) continue this
Agreement without the formation of the Company. In the event the
parties continue this Agreement without the formation of the
Company, either of the parties may elect, on one subsequent
occasion only, to initiate the process to form the Company
pursuant to this Article VII any time after a date that is 24
months after the date of the arbitrators' decision. In no event
shall either party have any rights or obligations under this
Article VII upon the conclusion of the second arbitration and this
Article VII shall thereafter be null and void.
ARTICLE VIII
EXCLUSIVITY
8.1 Scope of Exclusive Rights. Unless otherwise agreed in
writing by the parties, neither OCLI nor JDS may make for or sell
to third parties WDM Optical Filters, Fiber Bragg gratings, Planar
Waveguides or any other form of wavelength discrimination device
or technology for WDM Products or may provide WDM Products
assembly services for any technology for third parties.
ARTICLE IX
TERMINATION
9.1 Termination for Convenience by Either Party. On
January 31, 2015 and at the end of every five-year period
thereafter, upon 3 years prior written notice given within 6
months prior to such dates, either party may terminate this
Agreement for convenience.
9.2 Effect of Termination. Subject to Section 14.4, in the
event that either this Agreement or the Distributor Agreement,
Exhibit B, is terminated pursuant to any provision hereunder or
for breach, both this Agreement, including all licensed rights
granted hereunder, and said Distributor Agreement shall terminate
and all intellectual property rights owned by each party shall be
retained by such party and all intellectual property rights
jointly owned shall continue to be jointly owned provided however
that either party may thereafter exploit such joint intellectual
property rights without the consent or accounting to the other
party. In addition, in the event the Company has been formed, the
parties shall use their best efforts to effect an orderly
dissolution and wind-up of the Company by discharging all debts
and obligations of the Company with the remaining equity to be
distributed to the parties in accordance with their respective
interests in Profits; provided that all assets of the Company are
dealt with as follows. All assets of the Company shall be
transferred to the parties as mutually agreed. No Company asset
shall be conveyed, sold, leased or otherwise disposed of to a
third party unless both parties agree in writing to such disposal
in their respective sole discretion. Should the Company not have
sufficient monetary assets to discharge all debts and all
obligations of the Company, each of the parties shall share in the
discharge of such debts and obligations in accordance with their
respective interests in Company.
ARTICLE X
MANAGEMENT COMMITTEE
10.1 Management Committee. OCLI and JDS shall each appoint
two persons to serve as a Management Committee. The Management
Committee shall have the authority, acting reasonably, to manage
the design, development, manufacture and technical product
marketing support of the WDM Products Business pursuant to this
Agreement and until the formation of the Company. Meetings of the
Management Committee may be called by any member thereof upon one
business day notice to the other Management Committee members and
attendance may be by telephone, video conference or other means
agreed to by such members. Three members, or their designated
representatives, must be present for a quorum and no business
shall be conducted by the Management Committee except at such
meetings where a quorum is present. The affirmative vote of
three members is required to authorize all actions of the
Management Committee. In the event the Management Committee
reaches a deadlock, including consistent failure or refusal of one
or more party's members to attend meetings, the chief executive
officers then in office of JDS and OCLI shall jointly appoint one
non-affiliated business person to serve as the fifth member of the
Management Committee to break such deadlock. If the chief
executive officers of OCLI and JDS are unable to agree on who
should serve as the fifth member of the Management Committee, each
shall select one non-affiliated business person, and the two non-
affiliated business persons so selected shall select a third non-
affiliated business person who alone will then join the Management
Committee as the fifth member to break such deadlock.
10.2 Chairperson of the Management Committee. A member of
the Management Committee initially selected by OCLI shall serve as
chairperson for a nine-month term. Thereafter, JDS shall choose
the chairperson to serve for a nine-month term, and thereafter the
parties shall continue to rotate in the selection of the
chairperson for succeeding nine-month terms. The duties of the
chairperson shall be to organize and preside at meetings of the
Management Committee and to perform such other duties as from time
to time may be determined by the Management Committee. The
parties may adjust the term of the chairperson by mutual
agreement.
10.3 Delegation. The Management Committee may delegate
duties to one or more persons who need not be members of the
Management Committee.
10.4 Business Plan. The Management Committee shall prepare
the joint venture's annual Business Plan which shall include each
parties obligations and responsibilities all in accordance with
this Agreement. The Business Plan shall be completed not later
than the beginning of each Fiscal Year.
ARTICLE XI
RESEARCH AND DEVELOPMENT
11.1 Funding of R&D. The parties may propose any R&D
projects that relate to WDM Products Business to the Management
Committee or the Company. Notwithstanding the voting provisions
contained in Section 10.1, if the Company or the Management
Committee, acting through members or representatives that are
unaffiliated with the offering party, elects to conduct the R&D
project, the Company, or OCLI or JDS as determined by the
Management Committee, shall fund the R&D project which funding
shall constitute Costs and the results shall be owned by the
Company or equally by OCLI and JDS. Where the Company or said
members of the Management Committee decline to undertake the R&D
project, either party may conduct the R&D project provided that
the Company or said members of the Management Committee shall have
the right for a period of 60 days after declining to conduct the
R&D project to accept the R&D project in which case the total cost
of the R&D project shall be funded by the Company, or OCLI or JDS
as determined by the Management Committee, which funding shall
constitute Costs. In the event the Company or said members of the
Management Committee elect not to conduct the R&D project, or
exercise the 60 day option described above, either party is free
to conduct the R&D project with the results being owned by such
party with no obligation to license or otherwise share the results
with the Company or the other party and any products based on the
R&D project shall be deemed to fall outside of the definition of
WDM Products. In the event a party elects not to present an R&D
project to the Management Committee or the Company, and the
results of the R&D project has application in the WDM Products
Business, at the end of the R&D project such party will offer the
Company a nonexclusive, Non-assignable license limited to use the
results of such R&D project solely for the WDM Product Business,
based on commercially reasonable terms including lump sum and
royalty terms, which amounts shall be included in Costs but not be
included in the licensing party's revenues for the purpose of
determining such party's Transaction Profits. The Company shall
have a period of thirty (30) days from the date of such offer to
accept such license. In the event the Company does not take a
license within said time period, any products based on such R&D
project shall be deemed to fall outside of the definition of WDM
Products and the party owning such results shall have no
obligation to license or otherwise share the results with the
Company or the other party.
ARTICLE XII
THIRD PARTY LICENSING
12.1 Where the parties agree that a third party license of
intellectual property rights is needed to carry out the activities
hereunder, the costs of such license shall be included in Costs
for the purpose of sharing Profits under Article VI.
ARTICLE XIII
ACQUISITIONS
13.1 Where either party makes an acquisition in which it
has majority ownership and the acquiring party has control to
cause the acquisition to offer an intellectual property license
relating to WDM Products Business to the Company, immediately
after the completion of the acquisition the Company will be
offered a nonexclusive, Non-assignable license limited to use for
the WDM Product Business based on commercially reasonable terms
including lump sum and royalty terms. The Company shall have a
period of thirty (30) days from the date of such offer to accept
such license. Neither party is otherwise obligated to license or
otherwise share such intellectual property with the Company or the
other party.
13.2 Notwithstanding the voting provision contained in
Section 10.1, where either OCLI or JDS makes an acquisition in
which it has majority ownership (the "Acquiring Party") and the
acquisition's existing business includes WDM Products Business,
the Acquiring Party shall offer to the joint venture, immediately
after the completion of the acquisition, acting through the
members of the Management Committee or the governing body of the
Company who are unaffiliated with the Acquiring Party, the right
to have the Acquiring Party's share of Transaction Profits of the
acquisition's WDM Products Business included in the calculation of
Profit sharing between the parties pursuant to Article VI of this
Agreement. If the joint venture so elects within thirty (30) days
from the date of such offer to so participate, as consideration
for the right to so share in such Transaction Profits, the
Acquiring Party shall be compensated by the non-acquiring party
(the "Other Party"), in cash or other consideration acceptable to
the Acquiring Party, an amount that shall be equal to the portion
of the acquisition costs, including expenses (including costs
associated with determining the portion of the acquired company's
business allocable to the WDM Products Business), that is
attributed to the WDM Business of the acquired company (reflecting
the fact that the non-acquiring party will be acquiring a Profit
interest without any equity ownership, and taking into account the
remaining term of the Agreement under Section 9.2, and subject to
additional payments by the Other Party at the beginning of each
renewal term of the Agreement) times one-third where OCLI is the
Other Party and two-thirds where JDS is the Other Party.
Alternatively, the Acquiring Party may at its sole option agree
with the Other Party to adjust the Profit sharing pursuant to
Article VI to replace a portion or all of the said cash amount.
If the joint venture does not so elect within the specified time
period, the acquired company's business shall be completely
outside the scope of this Agreement and not be included in the
calculation of Profit. For greater certainty, where the Acquiring
Party is OCLI, the Other Party is JDS and vice-versa.
ARTICLE XIV
CONFIDENTIAL INFORMATION
14.1 "Confidential Information" shall mean any business,
marketing, technical, scientific, financial or other information,
specifications, designs, plans, drawings, software, prototypes or
process techniques, of a party, which at the time of disclosure,
is designated as confidential (or like designation), is disclosed
in circumstances of confidence, or would be understood by the
parties, exercising reasonable business judgement, to be
confidential, but excludes any information which:
(a) is independently developed by or for the receiving
party without reference to or use of Confidential Information;
(b) is lawfully received free of restriction from another
source having the right to so furnish such confidential
information;
(c) is or becomes lawfully in the public domain other than
through a breach of this Agreement;
(d) was known by the receiving party prior to disclosure,
as evidenced by its business records;
(e) disclosing party agrees in writing is free of such
restrictions;
(f) is disclosed by the disclosing party to a third party
without a duty of confidentiality on such third party; or
(g) is required or compelled by law to be disclosed,
provided that the receiving party give all reasonable prior notice
to the disclosing party to allow it to seek protective or other
court orders.
14.2 Except as otherwise allowed under this Agreement,
Receiving party shall keep Confidential Information of the
disclosing party in confidence; disclose it only to individuals in
the receiving party with a need to know and who are under
confidentiality restrictions; and use or reproduce it only to the
extent necessary for the activities contemplated hereunder. Each
party shall protect Confidential Information of disclosing party
with at least the same degree of care as it normally exercises to
protect its own Confidential Information of a similar nature, but
no less than a reasonable degree of care.
14.3 Receiving party agrees that any violation or threat of
violation of this section will result in irreparable harm to
disclosing party for which damages would be an inadequate remedy
and, therefore, in addition to its rights and remedies otherwise
available at law, including without limitation the recovery of
damages and expenses, including attorney's fees for breach of this
Agreement, disclosing party shall be entitled to unilaterally seek
equitable relief, including both temporary and permanent
injunctions, to prevent any unauthorized use or disclosure, and to
such other and further equitable relief as the court may deem
proper under the circumstances.
14.4 Notwithstanding anything contained herein to the
contrary, upon termination of the Agreement pursuant only to
Subsection 9.2, each party covenants and agrees that it will not
bring, commence or institute, or aid or abet any suit, action at
law, proceeding in equity, arbitration or other proceeding or
action based on, or related to, any claim or right under Article
XIV, Confidential Information, to the extent such claim or right
is based upon (i) in the case of claims or rights asserted by JDS
against OCLI, the use by OCLI of WDM Product Packaging Technology
in the field of use related to WDM Products A, B or C containing
one or more WDM Optical Filter A, B or C elements performing a
necessary wavelength discrimination function or (ii) in the case
of claims or rights asserted by OCLI against JDS, the use by JDS
of WDM Optical Filter Technology in the field of use related to
WDM Optical Filters A, B or C. For the purpose of this Section
14.4, (A) "WDM Product Packaging Technology" shall mean all
intellectual property rights relating to the design, manufacture,
assembly, testing and marketing of WDM Products A, B or C which
contain WDM Optical Filters A, B or C as at least one wavelength
discrimination element, including, but not limited to, patents,
trademarks and tradenames (but limited to trademarks and
tradenames which were specifically created to be used pursuant to
this Agreement and excluding any trademarks and tradenames which
contain as an element a any trademark or tradename of either
party), proprietary technical know-how and business information,
owned by JDS but limited to that used in the WDM Product A, B or C
Business, and (B) "WDM Optical Filters Technology" shall mean all
intellectual property rights relating to the design, manufacture
and testing of WDM Optical Filters A, B or C used as wavelength
discrimination elements in WDM Products A, B or C, including, but
not limited to, patents, trademarks and tradenames (but limited to
trademarks and tradenames which were specifically created to be
used pursuant to this Agreement and excluding any trademarks and
tradenames which contain as an element a any trademark or
tradename of either party), proprietary technical know-how and
business information, owned by OCLI but limited to that used in
the WDM Products A, B or C Business. In no event shall either
party be under any obligation whatsoever to provide any technical
information or services to the other party related to the use of
WDM Optical Filters Technology or WDM Products Packaging
Technology. In no event shall this Section 14.4 provide a right
to either party to disclose or grant any right in WDM Optical
Filter Technology or WDM Product Packaging Technology to any third
party. In addition to the forgoing, where WDM Optical Filters D
or WDM Optical Products D have been licensed pursuant to Section
3.6, then, only in the case where termination was made pursuant to
Section 9.1, such licenses shall continue on nonexclusive, Non-
assignable, commercially reasonable terms that would be applicable
if licensed in an arm's length transaction at the date of such
termination. For greater certainty, the parties agree that all
such continuing licenses after termination have a limited
permitted use restricted to use for the manufacture of WDM Optical
Filters D in the case of JDS, and WDM Products D in the case of
OCLI, and for no other purpose
ARTICLE XV
MISCELLANEOUS
15.1 Outside the scope of this agreement, OCLI agrees to
use its best efforts, subject to available capacity and prior
commitments, to supply optical filters for use in
telecommunication optical fiber products to JDS as requested on
normal Best Customer commercial terms. For the purposes of this
Section "Best Customer" shall mean that the prices charged and
delivery times for products purchased from OCLI by JDS are, and
will at all times be, no greater than the lowest prices charged by
OCLI to any third party for substantially the same quantity of all
such optical filters, on the same or similar delivery times as
those provided to any third party for such optical filters.
15.2 Order Backlog. All orders from WDM Products D received
on or after April 15, 1999 shall be included in the calculation of
Profits under Article VI. All orders in JDS's backlog for WDM
Products D as of April 14, 1999 and shipped on or after October
15, 1999 shall be included in the calculation of Profits.
15.3 Constraints on Employee Transfers. For a period of
two years following the termination of employment of an employee
of either party, the other party shall be prohibited from
employing such employee without prior written consent of the other
party; provided, however, that this restriction shall terminate
two years after the termination of this Agreement.
15.4 Governing Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of Delaware
without regard to the conflict of law principles or without regard
to the United Nations Convention on the Contracts for the
International Sale of Goods.
15.5 Disputes. Except for breach of Article XIV
Confidential Information, and subject to Sections 7.6 and 10.1,
except where the parties fail to take any required actions to
resolve their differences or there is no resolution under Section
10.1, if a dispute, breach or failure to agree shall occur between
the parties concerning this Agreement, both parties may require
the other party promptly to submit the reasons for its position,
in writing to the requesting party, and then to enter into good
faith negotiations, including the involvement, if appropriate, of
senior management of each of the Parties to attempt to resolve the
disagreement. If such dispute, breach or failure to agree cannot
be settled by good faith negotiation between the parties within 30
days, the matter shall be finally settled by mandatory, binding
arbitration, in accordance with the rules and procedures of the
American Arbitration Association applicable to commercial
transactions then in force, provided that arbitration proceedings
may not be instituted until sixty (60) days after delivery of any
such notice of arbitration and where the other party has not
remedied the matter within said time period. The arbitration
panel shall consist of three (3) arbitrators one of which shall be
appointed by each party and the third selected by the two so
appointed. Costs of arbitration shall be borne by the parties in
accordance with the decision of the arbitrators. Judgment upon
the award rendered may be entered in any court having competent
jurisdiction thereof, or application may be made to such court for
a judicial acceptance of the award and an order of enforcement as
the case may be. The arbitration proceedings shall be conducted
at a reasonable location selected by the parties or by the
arbitrators. The factors set forth in Section 7.2(e)(i) shall not
in any manner be disclosed to the arbitrators. Notwithstanding
the foregoing, the parties may apply to any court of competent
jurisdiction to compel arbitration in accordance with this
paragraph, without breach of this arbitration provision.
15.6 Attorneys' Fees. In case suit is brought or
arbitration proceedings commenced by either party because of the
breach of any term, covenant or condition contained in this
Agreement, the prevailing party shall be entitled to recover
against the other party the full amount of its costs, including
expert witness fees and reasonable attorneys' fees. If neither
party prevails entirely, such fees and expenses shall be prorated
based upon the relative success of each party to the relief being
sought.
15.7 Notices. All notices, offers, acceptances, approvals
and other communications under this Agreement shall be in writing
and shall be given to such party, addressed to it, at its address
or telecopy number set forth below or such other address or
telecopy number as such party may in the future specify for such
purpose by notice to the other party. Each such notice,
information, request or communication shall be effective upon
actual receipt by the party at the address specified below:
If to OCLI:
Optical Coating Laboratory, Inc.
2789 Northpoint Parkway
Santa Rosa, California 95407-7397
Telephone: 707-525-7030
Telecopier: 707-525-6840
Attention: General Counsel
(Joseph C. Zils, Esq.)
With a copy to (which is not required to constitute notice
to OCLI):
Collette & Erickson
555 California Street, Suite 4350
San Francisco, California 94104
Telephone: 415-788-4646
Telecopier: 415-788-6929
Attention: John V. Erickson, Esq.
If to JDS or Distributor:
JDS FITEL, Inc.
570 West Hunt Club Road
Nepean, ON K2G 5W8 Canada
Telephone: 613-727-1303
Telecopier: 613-727-1852
Attention: President (Jozef Straus, Ph.D.)
With a copy to (which is not required to constitute notice
to JDS):
JDS FITEL, Inc.
570 West Hunt Club Road
Nepean, ON K2G 5W8 Canada
Telephone: 613-727-1303
Telecopier: 613-727-8889
Attention: General Counsel (Gordon Buchan, Esq.)
Any party may from time to time specify as its address or telecopy
number for purposes of this Agreement any other address or telecopy
number upon the given of 10 days notice thereof to the other party.
15.8 Public Announcements. The parties shall not issue a press
release or other publicly available document containing any information
regarding the other party or the operating or financial results of the
joint venture or the Company without the prior written approval of the
other party unless such information has previously been lawfully and
publicly disclosed in writing or is lawfully and publicly available in
writing. Furthermore, such press releases are to be limited to what is
publicly available. At least 24 hours prior to the issuance of such
information, the issuing party shall provide the other party with notice
of its intention to disclose such information as well as the draft
wording of the information to be released. Where a party refuses to
approve the wording of the information to be released, the party shall
provide the reasons for such refusal and both parties agree to use their
best efforts to negotiate the appropriate wording of the information to
be released. However, nothing contained herein shall prevent a party
from disclosing any information that is required to be disclosed
pursuant to Securities Law and the rules or regulations promulgated
thereunder. Accordingly, each party therefore consents to the filing by
the other party with the SEC of a complete version of this Agreement.
Where a party issues a press release containing any information
regarding the other party, this Agreement, the transactions contemplated
herein or the operating or financial results of the Company, a copy of
such release shall be provided to the other party forthwith.
15.9 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original. A photocopy or
facsimile copy of the signatures of the parties to this Agreement shall
be considered authenticated signatures admissible into evidence where
the authenticity of the signatures are placed into question.
15.10 Interpretation. The table of contents and the headings to
the various subdivisions of this Agreement are for convenience of
reference only and shall not define or limit any of the terms or
provisions hereof. All pronouns shall be deemed to refer to the
masculine, feminine, neuter, singular or plural as the identity of the
Person or Persons referred to may require. The language in all parts of
this Agreement will in all cases be construed as a whole and in
accordance with its fair meaning and not restricted for or against
either party.
15.11 Successors and Assigns. This Agreement and any rights or
licenses granted herein are personal to each party and shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns, provided, however, neither party shall
assign any of its rights, privileges or obligations hereunder without
the prior written consent of the other party provided, however, that JDS
may assign this Agreement to JDS Uniphase Corporation. Should either
party attempt an assignment in derogation of the foregoing, the other
party shall have the right to immediately terminate this Agreement by
written notice to the other party.
15.12 Waiver. The failure of either party to give notice to the
other party of the breach or non-fulfillment of any term, clause,
provision or condition of this Agreement shall not constitute a waiver
thereof, nor shall the waiver of any breach or non-fulfillment of any
term, clause, provision or condition of this Agreement constitute a
waiver of any other breach or non-fulfillment of that or any other term,
clause, provision or condition of this Agreement.
15.13 Purchase By Competitor. In the event any third party which
is a direct competitor of the other party acquires a 20% or greater
equity participation in a party hereto, without first having obtained
the written consent of the other party, such other party may without any
delay, by written notice, terminate this Agreement by written notice to
the other party.
15.14 Entire Agreement. This Agreement sets forth the entire
agreement and understanding between the parties with respect to the
subject matter hereof and supersedes and cancels all previous
negotiations, agreements, commitments, and writings in respect to the
subject matter hereof, and neither party shall be bound by any term,
clause, provision or condition save as expressly provided in this
Agreement or as duly set forth on or subsequent to the date of execution
hereof in writing, signed by duly authorized officers of the parties.
15.15 Agency. Subject to Article VII, each party acknowledges
that it does not intend to create or imply a legal partnership with the
other parties by virtue of this Agreement and the parties agree that
nothing in this Agreement shall be construed as establishing or implying
any legal partnership between the parties hereto, and nothing in this
Agreement shall be deemed to constitute either of the parties hereto as
the Agent of the other party or authorize either party to incur any
expenses on behalf of the other party or to commit the other party in
any way whatsoever, without obtaining the other party's prior written
consent. The parties further agree that when any party hereto deals
with a third party as a result of this Agreement that such third party
will be notified that every party hereto is acting on its own behalf.
15.16 Survival. The provisions of Sections 9.3, 14, 15.3, 15.4,
15.5, 15.6, 15.7, 15.10, 15.11, 15.12, 15.16, 15.17 and 15.18, and for
Exhibit B, Article V and Article IX, shall survive termination of this
Agreement. The provisions of Section 6.5 shall survive for a period of
18 months following termination of this Agreement. Notwithstanding any
term to the contrary:
(a) where at the date of termination of this Agreement, (i) the Profit
is negative or (ii) Costs exist but there is no Profit; or
(b) where after the date of termination of this Agreement (i) if any
obligations, including but not limited to customs and duties, arise with
respect to any Cost that would have been included in Costs if the
obligation was identified during the period that the Agreement was in
effect, (ii) if any liability arose during the period that the Agreement
was in effect, including but not limited to any liability under Section
15.18 or Exhibit B Article V, but which was not identified or determined
until after the date of termination of this Agreement, or
(iii) bona fides bad debts arise for which revenues have been used in
the calculation of Profits;
then in all cases the parties agree to share the Costs such that OCLI
shall be responsible for paying one-third and JDS and Distributor
combined shall be responsible for paying two-thirds of all such Costs,
regardless of which party actually paid such Costs. The parties shall
promptly make payment to the other party as appropriate to ensure that
each party has fulfilled its obligation under this Section 15.19 with
regard to such Costs.
15.17 Further Assurances and Approvals. The parties agree to
make, do, execute, endorse, acknowledge and deliver or cause and procure
to be made, done, executed, endorsed, acknowledged, filed, registered
and delivered any and all further acts and assurances including any
conveyance, deed, transfer, assignment, share certificate or other
instrument in writing as may be necessary to give effect to the terms
and conditions provided for and contemplated by this Agreement. The
parties further agree that where any term, warranty, representation,
option or condition provided for or contemplated by this Agreement
requires prior regulatory or shareholder approval to give effect to such
term, warranty, representation, option or condition, the parties shall
not enforce such term, warranty, representation, option or condition
unless and until such approval is obtained.
15.18 Intellectual Property Indemnity Liability. Where any
threaten or actual proceeding or claim against any party alleging that
any WDM Product or WDM Optical Filter furnished hereunder during the
term of this Agreement infringes any third party intellectual property
rights, including without limitation any patents, trademarks and
copyright, the parties agree to jointly (i) defend or settle any such
matter, (ii) equally share any costs, including without limitation all
legal or expert fees and disbursements which were incurred as a result
of such defense or settlement, and (iii) equally share in the payment
of all damages and costs assessed by final judgment against any party
and attributable to such matter.
15.19 Approvals. The signatures provided below shall not be
deemed effective unless and until all required or counseled government
or regulatory filings are made and all approvals or consents are
obtained.
15.20 Representations and Warranties. Each party represents and
warrants that:
(a) it has full right and title to all of the Confidential
Information it discloses to the other party under this Agreement;
(b) to the best of its knowledge, there are no material liens,
encumbrances of any kind against its intellectual property which relates
to the WDM Product Business and that it is not subject to any
outstanding agreements, assignments or encumbrances that are
inconsistent with the provisions of this Agreement;
(c) to the best of its knowledge, there are no material actual or
threatened suits, actions at law, proceedings in equity, arbitrations or
other proceedings or actions against the party; and
(d) the execution, delivery and performance of this Agreement by
each party are within each party's corporate powers.
15.21 Force Majeure. Neither party be responsible or liable for
any delay or failure to deliver goods or perform services under this
Agreement due to any unforeseen circumstances or causes beyond that
party's control, including but not limited to, acts of God, fire, flood,
explosion, earthquake, war, insurrection, embargo, acts of civil or
military authorities, delay in delivery by suppliers, accident, strike
or other labour dispute, inability to secure labour, material,
facilities, energy or transportation. In the event of a force majeure
condition,
the time for delivery or other performance will be extended for a period
of time equal to the duration of such force majeure condition.
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the date first above written.
OPTICAL COATING LABORATORY, INC.
By ______________________________
Name ____________________________
Its _____________________________
JDS FITEL Inc.
By ______________________________
Name ____________________________
Its _____________________________
