EX-10.1 2 ex101.htm EXHIBIT 10.1 ex101.htm
EXHIBIT 10.1
 
Execution Version
 
 
 
AMENDED AND RESTATED
 
 
RESEARCH, DEVELOPMENT AND SUPPLY AGREEMENT
 
between
 
EPIR TECHNOLOGIES, INC.
 
and
 
SUNOVIA ENERGY TECHNOLOGIES, INC.
 
 
Original Effective Date: November 1, 2007
 
 
Amended and Restated as of:  January 24, 2008
 
 
 
 
1
 
 
 
TABLE OF CONTENTS
Page (s)
 
 
ARTICLE 2.SCOPE OF AGREEMENT
 
7
 
ARTICLE 3.TERM AND TERMINATION
 
 8
 
3.1.Term.
  
8
 
3.2.Termination for Cause
  
8
 
3.3.Termination for Force Majeure
   9
 
3.4.Effects of Termination
   9
 
3.5.Survival
   9
 
ARTICLE 4.LEGAL POSITION OF THE PARTIES
 
9
 
4.1.Public Announcements
   9
 
4.2.Independent Contractors
   10
 
4.3.No Affirmative Obligation
   10
 
ARTICLE 5.OBLIGATIONS OF EPIR
 
 10
 
5.1.Development.
   10
 
5.2.Marketing Support
   11
 
5.3.Technical Support
  
12
 
ARTICLE 6.OBLIGATIONS OF SETI
 
 12
 
6.1.Scheduled Payments
   12
 
6.2.Marketing And Technical Support
  
12
 
6.3.Promotion
   13
 
ARTICLE 7.PURCHASE AND SUPPLY OF PRODUCT.
 
14
 
7.1.Grant Of Exclusivity, Obligation To Supply EPIR Products.
  
14
 
7.2.Obligation to Supply.
   15
 
7.3.Inspection And Certification
  
15
 
7.4.Packaging
   15
 
ARTICLE 8.FORECASTS, ORDERS, AND CAPACITY
 
 16
 
8.1.Forecasts, Order Limits And Capacity.
  
16
 
8.2.Purchase Orders.
   16
 
 
2
 
 
ARTICLE 9.PRICE
 
 17
 
9.1.Purchase Price Of The EPIR Products.
   17
 
ARTICLE 10.SHIPMENT AND INVOICING
 
 18
 
10.1.Delivery Terms And Partial Shipments.
   18
 
10.2.Exporter Of Record.
   18
 
10.3.Export Costs And Documents.
   18
 
10.4.Foreign Corrupt Practices Act.
   18
 
10.5.EPIR Product and Services Payment Terms.
   19
 
10.6.Default In Payment Obligations.
   19
 
ARTICLE 11.ACCEPTANCE OF EPIR PRODUCT
 
 19
 
11.1.EPIR Product Conformity.
   19
 
11.2.Remedies For Non Conforming EPIR Product.
   20
 
ARTICLE 12. PRODUCTION OF EPIR Products
 
 20
 
12.1.Production.
   20
 
12.2.Testing.
   21
 
12.3.Permits And Licenses.
  
21
 
12.4.Regulatory Requirements.
   21
 
12.5.Changes In Manufacturing.
   21
 
ARTICLE 13.TRADEMARKS
 
22
 
ARTICLE 14.REPRESENTATIONS AND WARRANTIES
 
 22
 
14.1.Mutual Representations.
   22
 
14.2.EPIR Warranties.
   22
 
14.3.Disclaimer Of Warranties.
   22
 
14.4.SETI Warranties.
  
23
 
14.5.Disclaimer Of Warranties.
   23
 
ARTICLE 15.LIMITATION OF LIABILITY, WAIVER OF SUBROGATION
 
 23
 
15.1.Limitation Of Liability.
   23
 
15.2.Waiver Of Subrogation.
   23
 
ARTICLE 16.INDEMNIFICATION
 
 24
 
16.1.SETI Indemnification.
   24
 
 
3
 
 
16.2.EPIR Indemnification.
   24
 
16.3.Indemnitee Obligations.
   24
 
ARTICLE 17.INSURANCE
 
 25
 
17.1.SETI Insurance.
   25
 
17.2.EPIR Insurance.
   25
 
ARTICLE 18.INTELLECTUAL PROPERTY
 
25
 
18.1.Definition Of Intellectual Property.
   25
 
18.2.Existing Intellectual Property.
   25
 
18.3.Joint Patent Rights Developed During The Term.
  
26
 
18.4.Prosecution Of Joint Patent Rights.
   26
 
18.5.Licenses And Transfers Of Joint Patent Rights.
   26
 
18.6.Enforcement Of Joint Patent Rights.
   26
 
18.7.Disclaimer.
   27
 
18.8.Confidentiality.
   28
 
ARTICLE 19.NONDISCLOSURE AND PUBLICITY
 
 28
 
19.1.Confidentiality.
   28
 
19.2.Third Party Disclosure.
   28
 
19.3.Litigation And Governmental Disclosure.
   29
 
19.4.Limitation Of Disclosure.
   30
 
19.5.Publicity and SEC Filings.
   30
 
ARTICLE 20.FORCE MAJEURE
 
 30
 
ARTICLE 21. MISCELLANEOUS
 
 30
 
21.1.Entire Agreement
   31
 
21.2.No Waiver
   31
 
21.3.Assignment
   31
 
21.4.Governing Law
   31
 
21.5.Headings
   31
 
21.6.Counterparts
   31
 
21.7.Remedies
   31
 
21.8.Notices
   31
 
  JAMENDED AND RESTATED RESEARCH, DEVELOPMENT AND SUPPLY AGREEMENT

 
4
 
 
THIS AMENDED AND RESTATED RESEARCH, DEVELOPMENT AND SUPPLY AGREEMENT (HEREINAFTER REFERRED TO AS THE “AGREEMENT”) IS ENTERED INTO AS OF THIS 24th DAY OF JANUARY, 2008 (THE “AMENDMENT EFFECTIVE DATE”), AND IS ENTERED INTO BY AND BETWEEN:
 
EPIR Technologies, Inc., a corporation incorporated under the laws of the state of Illinois and having its main place of business at:
 
590 Territorial Drive
Unit B
Bolingbrook, IL 60440
 
represented by:
 
Sivalingam Sivananthan, President
 
(hereafter referred to as “EPIR”), as the first party,
 
AND
 
Sunovia Energy Technologies, Inc., a company incorporated under the laws of the state of Nevada and having its main place of business at:
 
6408 Parkland Drive
Suite 104
Sarasota, Florida 34243
 
represented by:
 
Carl Smith, Chief Executive Officer
 
(hereafter referred to as “SETI”), as the second party,
 
Jointly referred to hereafter as the “Parties” and referred to severally as a “Party”.
 
PREAMBLE
 
Whereas, EPIR will develop New Technologies and EPIR Products (as those terms are defined herein) that are, or will be, identified and defined by a Technology Development Board (“TDB”) which will be constituted by the Parties as set forth in Exhibit A of this Agreement;
 
Whereas, subject to the terms and conditions herein, EPIR will develop the necessary manufacturing processes for the EPIR Products;
 
Whereas, subject to the terms and conditions herein, EPIR will manufacture and supply EPIR Independent Products to SETI;
 
 
5
 
 
Whereas, SETI is developing products that will require the use of EPIR Products or EPIR Independent Products as critical elements thereof and is also developing distribution channels to sell EPIR Products, EPIR Independent Products and SETI Products incorporating EPIR Products or EPIR Independent Products (as those terms are defined herein);
 
Whereas, SETI will provide Scheduled Payments to EPIR that shall be specifically allocated by EPIR to the research, development and creation of mass manufacturing for the New Technologies and EPIR Products to the extent set forth in Exhibit A-1;
 
Whereas, Sun Energy Solar, Inc. (“SESI”) and EPIR entered a Research, Development and Supply Agreement dated November 1, 2007 (the “Initial Agreement” dated as of the "Effective Date"), which shall be amended and restated by this Agreement;
 
Whereas SESI was merged into a wholly-owned subsidiary of SETI ("Merger Sub"), and Merger Sub then assigned the Initial Agreement to SETI;
 
Whereas, SETI and EPIR subsequently entered into a Letter of Intent (the “LOI”) dated November 30, 2007;
 
Whereas, SETI and EPIR are entering into this Agreement in order to incorporate various terms of the LOI into a definitive agreement; and
 
Whereas, the Parties intend to collaborate for their mutual benefit and in the interest of the market to promote and sell compatible and innovative products and solutions to their customers.
 
NOW THE PARTIES HERETO AGREE AS FOLLOWS:
 
ARTICLE 1.             DEFINITIONS
 
As used herein the following terms, as including initial capital letters, shall have the following meanings:
 
1.1.  “EPIR” shall mean EPIR Technologies, Inc., an Illinois corporation.
 
1.2.  "EPIR Independent Products" shall mean any and all products owned or controlled by EPIR to the extent made available for sale by EPIR to SETI (including infrared sensors, biosensors), but excluding the EPIR Products.
 
1.3.  “EPIR Products” shall mean the products that are defined by the TDB, funded by SETI and developed by EPIR under this Agreement, including but not limited to one or more versions of photovoltaic solar cells or solar cell encapsulate technologies meeting the applicable Product Specifications.
 
1.4.  “Firm Purchase Order” is defined in Section 8.2.1.
 
1.5.  “Forecast” is defined in Section 8.1.1.
 
1.6.  “Minimum Purchase Commitment” is defined in Exhibit C.
 
 
6
 
 
1.7.  “New Technology”, or “New Technologies” when referring to the plural, shall mean any and all improvement, development, discovery, computer program, device, trade secret, method, know-how, process, technique or the like, whether or not written or otherwise fixed in any form or medium, regardless of the media on which contained, conceived of, created or reduced to practice during the course of performing this Agreement, whether or not patentable or copyrightable (but in all cases expressly excluding any such items relating to the EPIR Independent Products).
 
1.8.  “Product Price Listing” shall mean a price listing for a EPIR Independent Product or EPIR Product in a form substantially as set forth in Exhibit E hereof.
 
1.9.  “Product Specifications” shall mean, (a) for each EPIR Product, characteristics of such EPIR Product as are agreed to by the TDB as "Product Specifications" therefor and (b) for each EPIR Independent Product, characteristics of such product as provided by EPIR to SETI as "Product Specifications" therefor.  Such characteristics shall include, without limitation, the part number, dimensions and minimum performance criteria, in a level of detail at least sufficient to aid in the marketing, use and sale of the EPIR Product, the EPIR Independent Product, or the SETI Product into which the EPIR Product or EPIR Independent Product is incorporated.  The performance criteria may include, but not be limited to, solar to electrical energy conversion rates, operating temperature ranges, necessary operating environment parameters, resistance to the elements, energy storage capacities, impedance measurements, interface with any power or control sources and/or rated voltage and current outputs.
 
1.10.  “RMA” is defined in Exhibit G.
 
1.11.  “Scheduled Payments” shall mean the payments listed in Exhibit A-1.
 
1.12.  “SETI” shall mean Sunovia Energy Technologies, Inc., a Nevada corporation.
 
1.13.  “SETI Products” shall mean products manufactured by SETI or on SETI’s behalf, which incorporate one or more EPIR Products or EPIR Independent Products.
 
1.14.  “TDB” shall mean the Technology Development Board, the constitution, duties and other pertinent aspects of which are set forth in Exhibit A hereof.
 
ARTICLE 2.             SCOPE OF AGREEMENT; PRIOR ASSIGNMENTS; LOI; STOCK PURCHASE AGREEMENT
 
2.1.  Scope.  The scope of this Agreement is to: (i) establish the general, technical and business rules of the relationship between the Parties; (ii) define the strategic intent and purposes of the Agreement; and (iii) set forth the respective obligations of the Parties under this Agreement.  Each Schedule and/or Exhibit to this Agreement contains important representations and obligations of the Parties and forms an integral part of this Agreement.  Any and all Schedules and/or Exhibits to this Agreement are incorporated into this Agreement by this reference.
 
 
7
 
 
2.2.  Prior Assignments.  The Parties acknowledge that the Initial Agreement was assigned from SESI to Merger Sub by effect of the merger between such two entities.  SETI hereby acknowledges, represents and warrants that (a) the Initial Agreement was then assigned from Merger Sub to SETI and (b) that SETI has received and assumed the Initial Agreement and all rights, obligations and liabilities of SESI and Merger Sub under the Initial Agreement.
 
2.3.  LOI.  The LOI is hereby terminated and shall have no further force or effect.
 
2.4.  Stock Purchase Agreement and Stock Issuances.  The Parties will execute a Stock Purchase Agreement (the “SPA”) simultaneously with the execution of this Agreement, which will govern the issuance to SETI of certain common stock of EPIR and the issuance to EPIR of certain common stock of SETI (collectively, the "SPA Stock Issuances").  This Agreement is conditional upon the full execution of the SPA and closing of the SPA Stock Issuances pursuant to the SPA.
 
ARTICLE 3.             TERM AND TERMINATION
 
3.1.  Term.  The Initial Agreement was effective on the Effective Date and is currently in full force and effect.  This Agreement is effective on the Amendment Effective Date and shall expire on the 1st day of January, 2018 (the time between the Effective Date and this expiration date being the “Initial Term”), unless terminated earlier according to the provisions of this Article or as expressly permitted elsewhere herein.  Upon the expiration of the Initial Term, this Agreement shall automatically renew for subsequent one (1) year periods (each a “Renewal Term”) unless terminated, in writing, by a duly authorized representative of either Party, at least one hundred and eighty (180) days prior to the expiration of the Initial Term or the then-current Renewal Term.  The Initial Term, together with the Renewal Terms (if any), are referred to in this Agreement as the “Term”.
 
3.2.  Termination for Cause.  Either Party may terminate this Agreement for cause if the other Party fails to cure its material breach of the Agreement.  To terminate under this section, the nonbreaching party shall give notice to the breaching party of the breach, in such detail that the breaching party will be able to identify the nature of the breach.  Except with respect to a failure to make a payment required under this Agreement, the breaching party will then have three months from the date of such notice to cure the breach to the nonbreaching party’s reasonable satisfaction.  If the breach is a failure to make a payment required under this Agreement, the breaching party will have thirty (30) business days from the date of receipt of such notice to make payment of the full amount due.  If the breaching party fails to cure the breach to the nonbreaching party’s reasonable satisfaction within the applicable cure period, the nonbreaching party may terminate the Agreement immediately upon further notice to the breaching party.  The failure of SETI to make any Scheduled Payment, to pay for EPIR Products or EPIR Independent Products ordered by SETI, or to make any other payment required under this Agreement, shall be deemed to be a material breach of this Agreement.
 
 
8
 
 
3.3.  Termination for Force Majeure.  Upon the occurrence of any of the events listed in Article 20, such that a period of nonperformance of the non-terminating party for reasons of Force Majeure exceeds ninety (90) calendar days, either party may immediately terminate this Agreement upon written notice to the non-terminating party.
 
3.4.  Effects of Termination.  Scheduled Payments which were due to be paid to EPIR prior to the effective date of termination shall continue to be due to EPIR, and SETI shall have no obligation to pay Scheduled Payments which would have fallen due after the effective date of termination.  Except in the event of EPIR’s termination for SETI’s material breach, EPIR shall process in the ordinary course of business all Firm Purchase Orders confirmed by EPIR prior to receipt of the written notice of termination, and EPIR shall have no further obligation to supply EPIR Products or EPIR Independent Products to SETI.  Termination of this Agreement shall not excuse SETI from making payment of any amount owed to EPIR, including payments for EPIR Products and EPIR Independent Products shipped by EPIR prior to the effective date of termination.
 
3.5.  Survival.  Upon termination or expiration of this Agreement (other than termination pursuant to Section 2.4), all rights and obligations of the Parties which, by their nature, must survive the expiration or termination of this Agreement to give effect to their intent shall so survive, including without limitation, the provisions of:
 
Article 1, definitions;
Article 2, Sections 2.2-2.3, relating to the Initial Agreement and the LOI;
Article 3, Section 3.4, effects of termination;
Article 3, Section 3.5, survival;
Article 5, Section 5.1.3, relating to EPIR Independent Products;
Article 14, Sections 14.3 and 14.5, disclaimers of warranties;
Article 15, limitation of liability
Article 16, relating to indemnification;
Article 18, relating to intellectual property;
Article 19, relating to the Confidential Information of either party; and
Article 21, miscellaneous.
 
ARTICLE 4.             LEGAL POSITION OF THE PARTIES
 
4.1.  Public Announcements.  Upon execution of the Agreement by both Parties, SETI will be authorized to make public announcements about the relationship and the activities of the Parties under this Agreement.  Any and all public announcements made by SETI will be reviewed and approved by EPIR prior to their release.  The initial public announcement by SETI will include the following statements:
 
“Sunovia Energy Technologies, Inc. has formed an alliance with EPIR Technologies, Inc.  The Parties are working together to develop enhanced photovoltaic (PV) solar cells, materials research for advanced encapsulates, interconnects associated with PV solar cells, and cost effective manufacturing of PV materials that can be seamlessly integrated into higher efficiency renewable solar systems.  Using novel technologies in the field of fabrication of semiconductor epitaxial layers onto custom composite substrates and deposition processes, the Parties aim to have the state-of-the-art renewable energy products available for mass distribution within 12-24 months.”
 
 
9
 
 
Upon execution of the Agreement by both Parties, EPIR will be authorized to publicly announce the relationship and the activities of the Parties under this Agreement.  Any and all public announcements made by EPIR will be reviewed and approved by SETI prior to their release.  The initial public announcement by EPIR will include the following statements:
 
“EPIR Technologies, Inc. has formed an alliance with Sunovia Energy Technologies, Inc. to develop and distribute products using novel technologies in the field of fabrication of semiconductor epitaxial layers onto custom composite substrates and deposition processes for enhanced photovoltaic (PV) solar cells, materials research for advanced encapsulates and interconnects associated with PV solar cells and cost effective manufacturing of PV solar cells that can be seamlessly integrated into higher efficiency solar systems.  Using novel technologies in the field of fabrication of semiconductor epitaxial layers onto custom composite substrates and deposition processes, the Parties aim to have the state-of-the-art renewable energy products available for mass distribution within 12-24 months.”
 
4.2.  Independent Contractors.  In performing their duties under this Agreement, the relationship between SETI and EPIR shall be that of independent contractors. The Parties to this Agreement shall not be considered partners, joint venturers, agents or legal representatives of each other for any purpose, nor shall either Party accept contractual or other legal commitments (for or on behalf of the other Party) with regard to third parties.
 
4.3.  No Affirmative Obligation.  Nothing in this Agreement shall be construed as creating any obligation on the part of either Party to enter into any business relationship with any party other than the Parties specifically identified herein.
 
ARTICLE 5.             OBLIGATIONS OF EPIR
 
Subject to the terms and conditions of this Agreement, EPIR will: (i) use commercially reasonable efforts to develop EPIR Products using New Technologies that will be identified and defined by the TDB, using the procedure set forth in Exhibit B hereof; (ii) use commercially reasonable efforts to supply (A) EPIR Products using New Technologies and (B) EPIR Independent Products in quantities that are consistent with SETI’s forecasted demand under this Agreement; (iii) support SETI’s efforts in the marketing and promotion of the SETI Products; (iv) refer any and all inquires for purchase of the EPIR Products or SETI Products received from third parties to SETI; and (v) inform SETI of any inquiries received by EPIR from third parties who or are interested in engaging EPIR to develop photovoltaic solar cells and related technologies.
 
5.1.  Development.
 
5.1.1.  EPIR will use commercially reasonable efforts to develop EPIR Products using the New Technologies that are identified and approved by the TDB under the terms and conditions of this Agreement.  The TDB must develop Product Specifications for an EPIR Product prior to EPIR being obligated to supply such EPIR Product.
 
 
10
 
 
5.1.2.           Notwithstanding anything to the contrary in this Agreement, EPIR shall not be required to undertake any research or development work under this Agreement relating to EPIR Products or EPIR Independent Products that would not be fully funded by either the Scheduled Payments set fort