MASTER AND SHAREHOLDERS’ AGREEMENT

Dated 24 January 2012

 

Between

 

 

AXANE

 

 

 

 

 

And

 

 

 

 

 

PLUG POWER INC.

 

 

 

 

 

 

 

BETWEEN THE UNDERSIGNED :

 

 

1.      Axane , a Société Anonyme duly organized and validly existing under the laws of France, with a share capital of EUR 7,061,183.80, whose registered office is located at 2, rue de Clémencière, 38360 Sassenage, France , registered with the Grenoble Commercial and Companies Registry under number 429 770 134, represented by Mr. Hervé Mennrath, duly authorized for the purposes hereof,

 

hereinafter referred to as “ Axane ”,

 

2.       Plug Power Inc. , a company duly organized and validly existing under the laws of the State of Delaware, with capital stock consisting of 13,369,924 issued shares of USD 1.95 each, whose registered office is located at 968 Albany Shaker Road, Latham, New York 12110, represented by Mr. Andy Marsh, duly authorized for the purposes hereof,

 

hereinafter referred to as “ Plug Power ”,

 

Axane and Plug Power being hereinafter referred to each as a “ Party ” and together as the “ Parties ”.

 

In the presence of :

 

3.     Air Liquide Production, a Société par Actions Simplifiée duly organized and validly existing under the laws of France, with a share capital of EUR 50,000, whose registered office is located at 6 rue Cognacq-Jay, 75007 Paris, France , registered with the Paris Commercial and Companies Registry under number 444 676 944 , represented by Mr. Eric Prades, duly authorized for the purposes hereof,

 

hereinafter referred to as the “ JV Company ”.

 

 

 

 

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RECITALS

 

1. Axane, an entity of the Air Liquide Group, conducts an activity of development and manufacturing of hydrogen fuel cell systems for portable multipurpose power sources and stationary power sources.

2. Plug Power is a U.S. based company which develops and manufactures hydrogen fuel cell systems for the material handling market and is the owner of the related technology and intellectual property rights.

3. On October 14, 2011, the Parties entered into a Memorandum of Understanding pertaining to their envisaged investment in and the operation of a joint venture company, which main purpose would be the development and sale of integrated cost competitive hydrogen fuel cell systems for and to the European handling market, said market covering material handling products in Classes 1 through 5.

4. For the purposes set forth in paragraph C above and as an essential and determining condition to the respective undertakings of the Parties hereunder ( condition essentielle et déterminante du consentement ), (i) Axane shall, subject to the terms and limitations herein, finance the activities of the JV Company and provide to said JV Company its knowledge of the European handling market and (ii) Plug Power shall, subject to the terms and limitations herein and in the Contribution and License Agreement, contribute to the JV Company, on an exclusive basis for the entire territories of Albania, Austria, Belgium, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Liechtenstein, Luxemburg, Republic of Macedonia, Malta, Montenegro, the Netherlands, Norway, Poland, Portugal, Romania, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland and the United Kingdom (the “ Territory ”), its technology, any current or future developments and/or improvements thereof and all related intellectual property rights pertaining to hydrogen fuel cell systems necessary to carry out the activities of the JV Company as set forth in paragraph C above (all together the “ Technology and IP Rights ”).

5. The Parties have consequently come together to enter into this Agreement (as defined in Section 1.1 ) with a view to determine (i) the terms and conditions of the formation of the JV Company, (ii) the conditions of the contributions of the Parties to the JV Company, and (iii) the terms and conditions governing the management of the JV Company and the rights and obligations of the Shareholders of the JV Company (as such term is defined in Section 11.1 ).

6. The Parties have also come together to agree on the terms of the Ancillary Agreements (as such term is defined in Section 2.4 ) to be entered into as provided herein.

7. The Parties hereby confirm that Axane’s worker’s committee was informed and consulted on the formation of the JV Company under the terms herein.

 

In consideration of the mutual covenants and agreements contained in this Agreement, the Parties hereby agree as follows :

 

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ARTICLE I

DEFINITIONS AND INTERPRETATION

 

1.1.         Definitions .  In this Agreement, the following terms have the meanings specified or referred to below:

“ 2017 Accounts ” is defined in Section 12.1.2(g) .

“ 2020 Accounts ” is defined in Section 12.1.1(k) .

“ 2017 EBITDA ” is defined in Section 12.1.2(g) .

“ 2020 EBITDA ” is defined in Section 12.1.1(k) .

“ Adhesion Certificate ” is defined in Section 11.2.2(b)(v) .

“ Air Liquide Hydrogen Energy ” means Air Liquide Hydrogen Energy, a Société Anonyme duly organized and validly existing under the laws of France, with a share capital of EUR 50,000, whose registered office is located at 6 Rue Cognacq Jay, 75007 Paris, France.

“ Agreement ” means this Master and Shareholders’ Agreement, including the Recitals and Schedules thereto.

“ Affiliate ” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by or is under common control with, such Person. For the purpose of this definition, the term “control” has the meaning of the provisions of Article L. 233-3 of the French Commercial Code.

“ Ancillary Agreements ” is defined in Section 2.4 .

“ Articles of Association ” is defined in Section 2.6(c) .

“ Axane ” is defined in the Recitals.

“ Axane Contribution ” is defined in Section 3.1.1 .

“ Axane Operational Services Agreement ” is defined in Section 2.4(d) .

“ Board of Directors ” is defined in Section 14.3.1(a) .

“ Business Day ” means any day (other than a Saturday or Sunday) on which banks are open in France.

“ Business Plan ” is defined in Section 2.2 .

“ Call or Put Option Price ” is defined in Section 12.3(a) .

“ Chairman ” is defined in Section 14.4(a) .

“ Change of Control ” means, with respect to a company, the change of the control (as defined in Article L. 233-3 of the French Commercial Code), whether direct or indirect, of such company in favor of any Third Party(ies).

“ Change of Control Notice ” is defined in Section 13.1 .

 

 

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“ Closing ” means the time where (i) the Plug Power Contribution and the Axane Contribution become effective, as provided under this Agreement, and (ii) all other obligations required to be executed, performed or consummated by the Parties on or prior to the Closing Date pursuant to the terms and conditions set forth in this Agreement are performed.

“ Closing Date ” is defined in Section 5.1 .

“ Commercial Cooperation Agreement ” is defined in Section 2.4(e) .

“ Competitive Conditions ” is defined in Section 2.3.1(c) .

“ Conditions Precedent ” is defined in Section 6.1 .

“ Confidential Information ” is defined in Section 19.2.1 .

“ Contribution and License Agreement ” is defined in Section 2.4(a) .

“ Contribution Auditor ” is defined in Section 4.1.1(a) .

“ Court Order ” means any judgment, order, award or decree of any state, regional, local or other court or tribunal and any award in any arbitration proceedings.

“ Encumbrance ” means any lien, claim, charge, security interest, mortgage, pledge, usufruct or any other title retention agreement or undertaking.

“ Expenses ” means any and all reasonable and justifiable expenses incurred in connection with investigating, defending or asserting any claim, action, suit or proceeding incidental to any matter indemnifiable against hereunder (including court filing fees, court costs, arbitration fees or costs and reasonable fees and disbursements of legal counsel, consultants, and accountants).

“ Expert ” is defined in Section 12.3(b) .

“ First Call Option ” is defined in Section 12.1.1(a) .

“ First Call Option Period ” is defined in Section 12.1.1(c) .

“ First Call Option Price ” is defined in Section 12.1.1(g) .

“ First Call Option Notice ” is defined in Section 12.1.1(d) .

“ First Call Option Transfer Date ” is defined in Section 12.1.1(e) .

“ First Put Option ” is defined in Section 12.2.1(a) .

“ First Put Option Period ” is defined in Section 12.2.1(b) .

“ First Put Option Price ” is defined in Section 12.2.1(e) .

“ First Put Option Notice ” is defined in Section 12.2.1(c) .

“ First Put Option Transfer Date ” is defined in Section 12.2.1(d) .

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“ H ₂ E Collaboration Program ” means the «  Programme Mobilisateur pour L’Innovation Industrielle  » named H2E, and governed by the contract “Convention d’Aide pour le PMII H2E (reference I0808001W/L’Air Liquide)” executed on June 29, 2009 by Oseo Innovation and Air Liquide S.A. (and to which Air Liquide Hydrogen Energy was substituted)  duly mandated by 19 beneficiaries.

“ Indemnified Party ” is defined in Article IX .

“ Indemnifying Party ” is defined in Article IX .

“ Indemnity Option Notice ” is defined in Section 10.4(e) .

“ Indemnity Option ” is defined in Section 10.4(e) .

“ IP Claim Put Option Notice ” is defined in Section 10.4(d) .

“ IP Claim Put Option ” is defined in Section 10.4(d) .

“ IP Claim Put Option Transfer Date ” is defined in Section 10.4(f) .

“ IP Claim Put Option Price ” is defined in Section 10.4 (g) .

“ JV Company ” is defined in the Recitals.

“ JV Company IP ” is defined in Section 18.1 .

“ JV Company Shares ” means any of and all the shares (and all related rights under any form whatsoever, including the preferential right of subscription attached thereto) constituting the capital of the JV Company as from the Closing Date and during the entire term of this Agreement.

“ License Agreement ” is the License Agreement attached to and forming part of the Contribution and License Agreement.

“ Losses ” means all direct losses and/or reasonably foreseeable losses, costs, liabilities, settlement payments, awards, judgments, fines, penalties and damages and excluding, for the avoidance of doubt, consequential losses and/or liquidated damages.

“ Offered Shares ” is defined in Section 11.2.2(b)(i) .

“ Oseo Approval ” is defined in Section 2.3.1(e) .

“ Party ” is defined in the Recitals.

“ Percentage of Called Shares ” is defined in Section 12.1.1(k) .

“ Percentage of Call Option 1 Shares ” is defined in Section 12.2.2(g).

“ Percentage of Put Shares ” is defined in Section 12.2.2(f) .

“ Period ” is defined in Section 10.4(h) .

“ Permitted Transfer ” is defined in Section 11.2.1(a) .

“ Person ” means any individual, corporation, partnership, joint venture, limited liability company, association, joint-stock company, trust, unincorporated organization or Public Authority.

“ Plug Power ” is defined in the Recitals.

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“ Plug Power Contribution ” is defined in Section 3.2.1 .

“ Preceding Year Accounts ” is defined in Section 12.2.2(f) .

“ Preceding Year EBITDA ” is defined in Section 12.2.2(f) .

“ President ” is defined in Section 14.5(a) .

“ Price Calculation no.1 ” is defined in Section 12.1.1(g)

“ Price Calculation no.2 ” is defined in Section 12.1.1(g)

“ Project ” is defined in Section 2.1 .

“ Public Authority ” means any foreign, state, regional, local or other government, statutory, administrative, judicial or arbitral authority or body.

“ Recitals ” means the recitals of this Agreement.

“ Requirements of Law ” means any international federal, state, regional and local laws, statutes, decrees, regulations and rules promulgated by any Public Authority.

“ Reserved Matters ” is defined in Section 14.3.2(b) .

“ Revised Second Amount ” is defined in Section 12.2.2(g) .

“ Second Amount ” is defined in Section 12.1.1(g) .

“ Second Call Option ” is defined in Section 12.1.2(a) .

“ Second Call Option Period ” is defined in Section 12.1.2(c) .

“ Second Call Option Price ” is defined in Section 12.1.2(f) .

“ Second Call Option Notice ” is defined in Section 12.1.2(d) .

“ Second Call Option Transfer Date ” is defined in Section 12.1.2(e) .

“ Second Put Option ” is defined in Section 12.2.2(a) .

“ Second Put Option Notice ” is defined in Section 12.2.2(c) .

“ Second Put Option Periods ” is defined in Section 12.2.2(b) .

“ Second Put Option Price ” is defined in Section 12.2.2(e) .

“ Second Put Option Transfer Date ” is defined in Section 12.2.2(d) .

“ Selling Shareholder ” is defined in Section 11.2.2(b)(i) .

“ Shareholders of the JV Company ” is defined in Section 11.1.2

“ Share Transfer Agreement ” is defined in Section 10.4(f) .

“ Study” is defined in Section 10.4(a) .

 

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“ Study Counsel ” is defined in Section 10.4(a) .

 

“ Study Proposal ” is defined in Section 10.4(a) .

 

“ Sublease Agreement ” is defined in Section 2.4(b) .

 

“ Supply and Engineering Services Agreement ” is defined in Section 2.4(c) .

“ Technical Cooperation Agreement ” is defined in Section 2.4(f) .

“ Technology and IP Rights ” is defined in Paragraph D of the Recitals.

“ Termination Obligations ” is defined in Section 10.4(h) .

“ Territory ” is defined in Paragraph D of the Recitals.

“ Third Party ” means with respect to a Person, another Person which is not an Affiliate.

“ Third Party Claim” is defined in Section 10.4(c) .

“ Third Party Purchaser ” is defined in Section 11.2.2(b)(i) .

“ Threshold ” is defined in Section 14.5(b) .

“ Transfer ” means any direct (i) sale, assignment, contribution, exchange, gift or other transfer of shares, or any other arrangement or transaction which would allow any other person the right to participate in the income, capital growth or voting rights of any shares, including any merger, demerger or derivative transaction that would have an economic effect similar to a sale or partial sale of share and/or (ii) any creation, incurrence, assumption or suffering of existence of any pledge, security interest or lien upon or with respect to any shares. For the avoidance of doubt, the issuance or transfer of equity interests in any of the Parties, including as part of a transaction constituting a Change of Control, shall not constitute a “Transfer” of  such Party’s JV Company Shares.

“ Transfer Notice ” is defined in Section 11.2.2(b)(i) .

“ Transfer Registration ” is defined in Section 12.1.4.

“ Vice Chairman ” is defined in Section 14.4(b) .

“ Wind-Up Notice ” is defined in Section 10.5(d)

1.2.      Interpretation

Unless the context clearly indicates otherwise:

(a)         words used in the singular include the plural and words in the plural include the singular;

(b)         reference to any Person includes such Person’s successors and assigns but only if such successors and assigns are permitted by this Agreement;

(c)         the word “including” means “including but not limited to” or “including without limitation”;

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(d)          reference to any Article, Section, Annex or Schedule means such Article or Section of, or such Annex or Schedule to, this Agreement, as the case may be, and references in any Section or definition to any clause means such clause of such Section or definition;

(e)          the words “herein,” “hereunder,” “hereof,” “hereto” and words of similar import shall be deemed references to this Agreement as a whole and not to any particular Section or other provision hereof;

(f)           relative to the determination of any period of time, “from” means “from and including” “to” means “to but excluding” and “through” means “through and including”;

(g)          the Annexes and Schedules referred to herein shall be construed with and as an integral part of this Agreement to the same extent as if they were set forth verbatim herein and shall contribute to the interpretation of this Agreement;

(h)          the titles to Articles and headings of Sections contained in this Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of or to affect the meaning or interpretation of this Agreement.

This Agreement shall be construed to the maximum extent possible so as to uphold the enforceability of each of the terms and provisions hereof, it being understood and acknowledged that this Agreement was entered into by the Parties after substantial negotiations and with full awareness by the Parties of the terms and provisions contained therein and the consequences thereof.

 

 

*          *

*

 

 

 

 

 

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ARTICLE II
PURPOSE AND ORGANIZATION OF THE JV COMPANY

 

2.1.         Purpose of the JV Company

The business of the JV Company shall be the development and sales, on the Territory, of integrated cost competitive hydrogen fuel cell systems for the designated material handling market, said market covering material handling products in Classes 1 through 5 (the “ Project ”).

 

2.2.         Business Plan

The 10-year business plan for the JV Company agreed between the Parties is attached hereto as Schedule 2.2 (the “ Business Plan ”).  Any amendment to the Business Plan of net negative value of more than the Threshold (as such term is defined in Section 14.5(b) )  shall be discussed and made in good faith between the Parties as part of a Board of Directors’ decision, as a Reserved Matter, it being understood that pending such decision by the Board of Directors, the Parties shall not approve or support any acts which would constitute any such amendment to the Business Plan, either directly or indirectly and by using their powers as shareholders and/or directors of the JV Company.

 

2.3.         Commercial Objectives

2.3.1       For the purposes of its business, the JV Company shall seek to gain its autonomy as quickly as possible by:

 

(a)          creating and developing its own manufacturing facility initially in the premises covered by the Sublease Agreement, with a view to progressively (i) purchase parts from other sources as under the Supply and Engineered Services Agreement referred to in Section 2.4(c) below and (ii) manufacture its own hydrogen fuel cell systems – all in accordance with the Business Plan;

(b)          hiring (in accordance with the terms herein), training and paying its own employees; it being specified that the Parties agree that the JV Company shall apply a salary policy and other employment conditions consistent with the policy and conditions applied by Axane;

(c)          when necessary and efficient, sub-contract or outsource part of the Project to Third Parties; it being specified for the avoidance of doubt, that:

(i)        the decision of the JV Company to source products or parts from a manufacturer other than Plug Power where such products or parts fall within the Plug Power product line at the time any such decision is made (as such product line will be defined, updated and notified to the JV Company from time to time by Plug Power) shall be treated as a Reserved Matter hereunder;

 

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(ii)       in the event a client order or any product development of the JV Company requires the sourcing by the JV Company of products or parts which fall outside of the Plug Power product line as notified from time to time to the JV Company but which are comparable to products or parts of the GenDrive offering:

 

-      such order or development and details thereof shall be notified by the JV Company to Plug Power. Within 30 (thirty) days from the receipt of such notification, Plug Power shall notify to the JV Company of its undertaking to manufacture or source from another manufacturer such products or parts at Competitive Conditions and under the designated terms and timing as specified in the client order;

 

-      failure by Plug Power (i) to notify its undertaking to the JV Company within the above 30 (thirty) day period and (ii) to offer the manufacturing or sourcing of such products or parts at Competitive Conditions shall be deemed an irrevocable waiver by Plug Power of its right to supply the relevant products or parts and the JV Company shall be entitled to source from a Third Party said products or parts for the specific customer order; 

 

-      any subsequent customer orders shall follow the same process to determine whether or not Plug Power can manufacture or source the relevant products or parts, under Competitive Conditions, at the time of the new customer order; 

 

-      if there is disagreement about whether or not the GenDrive offering is competitive with the products of the proposed Third Party manufacturer(s), the “ Competitive Conditions ” shall be assessed on the basis of the terms and conditions set forth in Schedule 2.3.1(c) .

 

(iii)      in the event a client order or any product development of the JV Company requires the sourcing by the JV Company of products or parts which fall outside of the Plug Power product line as notified from time to time to the JV Company and which are not comparable to products of the GenDrive offering:

 

-      such order or development and details thereof shall be notified by the JV Company to Plug Power. Within 15 (fifteen) days from the receipt of such notification, Plug Power shall notify to the JV Company of its undertaking to manufacture or source from another manufacturer such products or parts under the designated terms (including price and quality) and timing as specified in the client order;

 

-      failure by Plug Power (i) to notify its undertaking to the JV Company within the above 15 (fifteen) day period and (ii) to offer the manufacturing or sourcing of such products or parts under the designated terms (including price and quality) and timing as specified in the client order shall be deemed an irrevocable waiver by Plug Power of its right to supply the relevant products or parts and the JV Company shall be entitled to source from a Third Party said products or parts for the specific customer order; 

 

-       any subsequent customer orders shall follow the same process to determine whether or not Plug Power can manufacture or source the relevant products or parts at the time of the new customer order; 

 

in all cases, the sub-contracting or outsourcing to a Third Party shall be performed, to the best extent possible, at the risk and under the responsibility of the relevant Third Party(ies);

 

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(iv)      in the event that pursuant to the above, Plug Power receives a notification from the JV Company of a client order or any product development request for a product or part that Plug Power does not, acting in good faith, intend to include in its product roadmap within the next twelve months, Plug Power shall provide the JV Company written approval to circumvent the process outlined above and source the relevant products or parts from a manufacturer other than Plug Power to satisfy such relevant client order and any subsequent client orders for that specific product or part;

 

(v)       as an exception to Section 19.3 , any notification to be made between the JV Company and PlugPower for the purposes of this paragraph (c) shall be delivered by email to (i) luc.vandewalle@airliquide.com, and as may be notified otherwise from time to time by the JV Company, as concerns the JV Company, and to (ii) James_Petrecky@plugpower.com as may be notified otherwise from time to time by Plug Power, as concerns Plug Power, it being specified that any such notification shall be deemed received on the next Business Day following the transmission by email;

 

(d)          seeking, with the assistance of Plug Power, to reach an agreement and enter into a supply agreement with Ballard, the current stack supplier of Plug Power, under substantially the same terms and conditions as the current Plug Power supply agreement with Ballard, a copy of which has been provided to Axane. For the purposes of this paragraph, Plug Power shall use its commercially reasonable efforts to facilitate the discussions between the JV Company and the above supplier and provide, as soon as possible after Closing, a copy of the above current Ballard/Plug Power supply agreement to the JV Company;

(e)           participating to the H ₂ E Collaboration Program supported by Oseo Innovation with respect to fuel cell systems for the material handling market. For the purposes above, Axane shall cause Air Liquide Hydrogen Energy, as head of the consortium of beneficiaries under the H ₂ E Collaboration Program, to make its commercially reasonable efforts in order for the JV Company to obtain a written approval by Oseo Innovation and by the other participants to the H ₂ E Collaboration Program of the adhesion by the JV Company to the H ₂ E Collaboration Program as a new beneficiary under terms and conditions accepted by both Parties (the “ Oseo Approval ”).  Any decision to accept or refuse the terms and conditions of the participation of the JV Company to the H ₂ E Collaboration Program is listed hereunder as a Reserved Matter. Before taking such decision, the Board of Directors shall be provided in advance by Axane and/or Air Liquide Hydrogen Energy with all contractual, technical and financial documentation to be submitted to Oseo Innovation. For the purposes of the above, Axane and/or Air Liquide Hydrogen Energy shall provide Plug Power regularly, at least once a month, with updates as to the status of the Oseo Approval, as well as, as soon as possible, with any information of significance with respect to the Oseo Approval. Plug Power shall also be consulted sufficiently in advance as regards any draft contractual documentation to be submitted to Oseo Innovation with respect to the participation of the JV Company to the H ₂ E Collaboration Program to enable Plug Power to make comments and to enable the Parties to agree on such terms. Axane and/or Air Liquide Hydrogen Energy shall as soon as possible, inform Plug Power in writing if it becomes aware of anything that could result in the Oseo Approval being delayed or denied and/or if the Oseo Approval is granted or rejected (and provide Plug Power with a copy of the relevant approval or reject documentation);

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(f)           making its best efforts to study with Axane, Air Liquide Hydrogen Energy and/or their Affiliates the potential commercial and technical synergies between their respective activities, on a non exclusive basis, under the terms of the Commercial Cooperation Agreement and the Technical Cooperation Agreement, referred to below in Section 2.4(e) and (f) .

2.3.2       The Parties further agree that the JV Company shall, subject to the terms herein, determine the final terms and conditions to be offered to the European material handling market for its hydrogen fuel cell systems in accordance with the terms and conditions outlined in the Supply and Engineered Services Agreement.

 

2.4.     Ancillary Agreements

As further set forth below, the Parties agree that, for the purposes of the business of the JV Company, the following agreements (together the “ Ancillary Agreements ”) shall be entered into at Closing or as provided below and with respect to the Contribution and License Agreement, sufficiently prior to Closing to allow the Plug Power Contribution to be effective on the Closing Date:

 

(a)          a contribution agreement to which the License Agreement shall be attached, both to be entered into between the JV Company, as beneficiary and licensee, and Plug Power, as contributor and licensor, with respect to the Technology and IP Rights (together the “ Contribution and License Agreement ”), and to be entered into substantially in the form of the draft attached hereto as Schedule 2.4(a) ;

(b)          a short-term sublease agreement to be entered into between the JV Company, as sublessee, and Axane, as sublessor, with respect to a portion of the facility of Axane in Sassenage (38) 2, rue Clemencière,France, on a rent-free and charge-free basis until December 31, 2012 and thereafter until the new premises referred to below are available for an amount of rent and charges corresponding to the prorata of the rent and charges paid by Axane to its lessor (the “ Sublease Agreement ”), to be mutually agreed between the Parties prior to the Closing Date;  

Axane further undertakes, as soon as the new premises to be built on the same site are erected, to offer to Hypulsion a sublease agreement for the new premises, under similar terms as the existing lease agreement, which will be leased by Axane and subleased to Hypulsion upon their completion. This sublease agreement will be concluded for a term equal to the duration of the lease between Axane and its lessor and for an amount of rent and charges corresponding to the prorata of the rent and charges paid by Axane to its lessor.

 

These two lease agreements shall provide for:
 

•          an express waiver by Hypulsion to the benefit of the status of French commercial leases, and
 

•          an automatic termination clause upon the expiry of a period of six (6) months from the date of any notification (including the IP Put Option, the First Put Option Notice and the Second Put Option Notice or the First Call Option Notice and the Second Call Option Notice) the effect of which will be that the JV Company ceases to be an Affiliate of Axane and/or its Affiliates.

 

 

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(c)           a supply and engineered services agreement to be entered into between the JV Company and Plug Power and whereby (i) the JV Company shall be granted the exclusive right to purchase, sale and distribute the fuel cells and parts from Plug Power in the Territory and (ii) Plug Power shall provide to the JV Company services pertaining to product development (the “ Supply and Engineered Services Agreement ”), and to be entered into substantially in the form of the draft attached hereto as Schedule 2.4(c) ;

(d)          an operational services agreement to be entered into between the JV Company and Axane and whereby Axane shall provide to the JV Company services pertaining to marketing, IT or any other identified support (the “ Axane Operational Services Agreement ”), it being specified that such services shall be rendered by Axane on an “at cost” basis;

(e)          a commercial cooperation agreement to be entered into between Air Liquide Hydrogen Energy and the JV Company (in the presence of Plug Power) providing the terms of the contemplated commercial synergies between their respective activities, in particular with respect to potential joint offers to be made to clients (the “ Commercial Cooperation Agreement ”) and to be entered into substantially in the form of the draft attached hereto as Schedule 2.4(e);

(f)           a technical cooperation agreement to be entered into between Air Liquide Hydrogen Energy (and/or any other relevant entities of the Air Liquide group) and the JV Company (in the presence of Plug Power) providing the terms of potential joint technical developments (the “ Technical Cooperation Agreement ”), said Technical Cooperation Agreement to be finalized and entered into as soon as possible after the date hereof and at the latest within ninety days (90) days following the Closing  Date .

With respect to the Sublease Agreement and the Axane Operational Services Agreement, the relevant drafts thereof shall be discussed and finalized in good faith between the Parties between the date hereof and Closing.

 

2.5.        Compliance with Laws and Principles

2.5.1       As long as Axane remains a majority shareholder of the JV Company, the Project shall be carried out by the JV Company and the JV Company shall carry out its activities according to the Air Liquide Group Principles of Action, Social and Environmental Responsibility Policy and Employee Code of Conduct , as well as in compliance with French, where applicable, and other applicable Requirements of Law.

 

2.5.2       For the avoidance of doubt, acting for the JV Company in accordance with the rules set in this Agreement and in the Ancillary Agreements shall not be deemed to constitute a conflict of interest or a breach of the Air Liquide Group Principles of Action, Social and Environmental Responsibility Policy and Employee Code of Conduct referred to above for any employee, officers and/or directors of the JV Company.

 

2.6.         Main Corporate Characteristics of the JV Company

(a)          The Parties agree to use as a legal structure of the JV Company, Air Liquide Production, a Société par Actions Simplifiée duly organized and validly existing under the laws of France, whose registered office is located at 6 rue Cognacq-Jay, 75007 Paris, France , registered with the Paris Commercial and Companies Registry under number 444 676 944.  Immediately prior to the Closing Date, Axane shall be the sole shareholder of the JV Company.

 

(b)          Upon Closing, the name of the JV Company shall be changed to Hypulsion and the registered office of the JV Company shall be transferred to 2 rue de Clémencière, 38360 Sassenage, France.

 

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(c)           Upon Closing, the articles of association of the JV Company (the “ Articles of Association ”) will be amended and adopted substantially in the form of the draft attached hereto as Schedule 2.6(c) , it being specified that the Parties shall finalize the French translation of the Articles of Association between the date hereof and the Closing Date.

 

ARTICLE III

CONTRIBUTIONS TO THE JV COMPANY

 

3.1.         Contribution of Axane

3.1.1      Without prejudice to the terms of Section 3.1.2 below and subject to Section 3.2.3(ii) , Axane hereby undertakes to subscribe, at Closing, to the capital increase ( augmentation de capital en numéraire ) of the JV Company provided in Section 5.2 below for a total amount (capital and premium, as the case may be) of EUR 5,500,000 (five million five hundred thousand euros) (the “ Axane Contribution ”). In consideration for the Axane Contribution, the JV Company shall issue, on the Closing Date, in favor of Axane, the relevant number of JV Company Shares in order  for Axane to hold 55% of the share capital and voting rights, on a fully diluted basis, of the JV Company (subject to the Plug Power Contribution).

 

3.1.2        Subject to the provisions of Section 3.2.3(ii) below, Axane hereby undertakes to pay up the JV Company Shares issued by the JV Company on the Closing Date in consideration of the Axane Contribution as follows:

 

(a)          on the Closing Date, Axane will pay up a total amount of EUR 1,800,000 (one million eight hundred thousand euros) (with a par value and a subscription premium determined, as the case may be, in accordance with Section 3.2.3(i)) ;

 

(b)          Axane will pay up an amount of EUR 2,200,000 (two million two hundred thousand euros) at the earliest between (i) in the absence of a Third Party Claim (as such term is defined in Section 10.4(c)) January 18, 2013 and (ii) in the event of a Third Party Claim, within fifteen (15) days of an agreement being reached between the Parties on an appropriate commercially reasonable solution under Section 10.4(c) or, as the case may be, of receipt by Axane of the Indemnity Option Notice.  For the avoidance of doubt and without prejudice to the terms of Section 11.2.3 , Axane shall not be obliged to pay up the above EUR 2,200,000 amount (nor the amount to be paid under paragraph (c) below) in the event of exercise by Axane of the IP Claim Put Option and the absence of exercise by Plug Power of the related Indemnity Option;

 

(c)          on January 24, 2014, Axane will pay up an amount of EUR 1,500,000 (one million five hundred thousand euros); it being specified that, without prejudice to the terms of Section 11.2.3 , the amount referred to in this paragraph (c) above shall not be paid in the case of exercise by Axane of the IP Claim Put Option (and in such case subject to the absence of exercise by Plug Power of the related Indemnity Option) and/or the First Put Option prior to the applicable payment date.

 

3.1.3       The provisions of Section 3.1.1 above shall not be construed as a general undertaking from Axane to finance the development and the activities of the JV Company through contributions and/or loans other than as provided in Section 3.1.1 above.

 

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3.2.          Contribution of Plug Power

3.2.1        Plug Power hereby undertakes to contribute to the JV Company, at Closing, the right to use (“ apport en jouissance ”) the Technology and IP Rights for the Territory (the “ Plug Power Contribution ”). The Plug Power Contribution shall be carried out in compliance with the Contribution and License Agreement to be entered into substantially in the form of the draft attached hereto as Schedule 2.4(a) .

 

The Parties agree that, subject to the conclusions of the Contribution Auditor, the Plug Power Contribution shall be valued to a total amount of EUR 4,500,000 (four million five hundred thousand euros).

 

3.2.2        In consideration for the Plug Power Contribution, the JV Company shall issue on the Closing Date in favor of Plug Power a number of shares representing 45% of the share capital and voting rights, on a fully diluted basis, of the JV Company.

 

3.2.3        Notwithstanding the provisions of Section 3.2.1 , in the event the Contribution Auditor challenges the valuation of the Plug Power Contribution as set forth in Section 3.2.1 and provides in his/her report for a valuation of the Plug Power Contribution:

 

(i)            between EUR 4,500,000 (four million five hundred thousand euros) and EUR 4,037,000 (four million thirty seven thousand euros), (x) the Parties undertake to decrease the par value of the Plug Power Contribution to the amount set forth in the report of the Contribution Auditor (without decreasing the global amount of the Axane Contribution) and (y) Axane agrees to pay a subscription premium ( prime d'émission ) valuated so as to allow that the JV Company Shares to be held by Axane and Plug Power at Closing will represent respectively 55% and 45% of the share capital and voting rights, on a fully diluted basis, of the JV Company. For the sake of clarification, calculation examples of the subscription premium are set forth in Schedule 3.2.3(i) ; or

 

(ii)           below EUR 4,037,000 (four million thirty seven thousand euros), the Parties undertake to negotiate in good faith, during a period of 45 (forty five) days following the issuance of the report of the Contribution Auditor, any alternative funding scheme for the JV Company in order to seek to reach an agreement on revised terms and conditions of the contributions of the Parties to the JV Company and any related amendment to the terms of this Agreement, with the objective to maintain the allocation of 55% (for Axane) and 45% (for Plug Power) in the share capital of the JV Company and the amount and substance of the Contribution of Axane and of Plug Power. If the Parties fail to reach such an agreement during the above 45 (forty five) day period, and unless otherwise agreed, this Agreement shall lapse and become null and void (except as concerns the confidentiality obligations) and no expenses or damages of any kind shall be due between the Parties.  

 

3.3.          The Parties acknowledge that the issuance of a report by the Contribution Auditor is a requirement under French law.  Without prejudice to the independent conclusion of the Contribution Auditor regarding the valuation of the Plug Power Contribution, the Parties acknowledge that they have engaged in good faith negotiations, at arm’s length, regarding the valuation of the Plug Power Contribution and regarding the respective amount of the Axane Contribution and the Plug Power Contribution, and that each of the Parties believes that the valuation and amount of such Contributions and the resulting allocation of the JV Company Shares fully and fairly reflect the relative contribution by each of the Parties to the JV Company.  Notwithstanding the above, nothing in this provision shall be deemed to constitute a representation and warranty of one of the Parties to the others with respect to the valuation of any Contribution.

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ARTICLE IV

ACTIONS PRIOR TO CLOSING

 

4.1           Plug Power Contribution . 

 

4.1.1        For the purposes of Closing, Axane shall cause the JV Company to prepare, before the Closing Date, the legal and corporate documentation necessary to the implementation of the contemplated transactions referred to in Article III above. In particular, Axane shall cause:

 

(a)          the JV Company to request the President of the competent Commercial Court ( Tribunal de Commerce ) to appoint a contribution auditor ( commissaire aux apports ) in order to confirm the valuation of the Plug Power Contribution (the “ Contribution Auditor ”) and will propose as Contribution Auditor Mr. Vincent Baillot (BDO), and if a second Contribution Auditor is required, Mr. Jean Pierre Cordier (Grant Thornton);

(b)          the JV Company to provide to the Contribution Auditor all relevant and reasonable information to allow the Contribution Auditor to draft his report, it being specified that Plug Power shall provide all necessary and reasonable information to the JV Company with respect thereto and that Plug Power shall be invited to participate to any discussion and written communication with the Contribution Auditor and to make any observations on his/her draft report, with reasonable prior notice, provided that any information provided by Plug Power pursuant to this Section will be subject to the confidentiality provisions of Section 19.2 and, in case the Closing does not occur and the Agreement is terminated in accordance with Section 6.2 , the JV Company and Axane will return to Plug Power any Confidential Information and will confirm in writing that they have not kept and will not use any such Confidential Information;

(c)          the JV Company to file such report with the clerk of the competent Commercial Court  at least eight (8) days before the Closing Date and at the registered office of the JV Company at least fifteen (15) days before the Closing Date; and

(d)          a meeting of the shareholders of the JV Company to be convened (and the statutory auditors) on the Closing Date in accordance with Section 5.2 below.

4.1.2         Subject to the satisfaction of the conditions mentioned in Article VI , this Section and in Section 3.2 above, Plug Power shall, and Axane shall cause the JV Company, to enter into the Contribution and License Agreement.

 

4.2           Axane Contribution . For the purposes of Closing, EUR 1,800,000 (one million eight hundred thousand euros) shall be deposited by Axane (by wire transfer) on a blocked bank account opened in the name of the JV Company, at least eight (8) days before the Closing Date and the related certificate shall be issued by the depositary bank of the JV Company.

 

 

ARTICLE V

 

CLOSING

 

  5.1.       Closing Date .  Unless agreed otherwise between the Parties, the Closing shall occur, at the offices of Dechert (Paris) LLP (32 rue de Monceau, 75008 Paris), on (i) February 29, 2012 if the Conditions Precedent provided in Article VI are satisfied (or as the case may be, waived by Axane and/or Plug Power) by such date and the shareholders’ meeting of the JV Company which is to decide on the Axane Contribution and the Plug Power Contribution can be held on such date, or (ii) if said Conditions Precedent are not satisfied (or waived by Axane and/or by Plug Power) and/or if the shareholders’ meeting of the JV Company which is to decide on the Axane Contribution and the Plug Power Contribution can not be held by or on February 29, 2012, within fifteen (15) Business Days following the satisfaction (or the waiver by Axane and/or by Plug Power) of the last of the Conditions Precedent set forth in Section 6.1(a) and (b) . The Parties hereby undertake and agree to use all of their respective reasonable endeavors to ensure that the Conditions Precedent are satisfied so that Closing can take place on February 29, 2012. The Parties further agree that they shall keep each other informed of the progress of the collection of the closing documents listed in Sections 5.3 and 5.4 on a regular basis between the date hereof and the Closing Date. The time and date when the Closing is actually held are referred to in this Agreement as the “ Closing Date ”.

 

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For the avoidance of doubt, drafts of all the closing documents shall be communicated to the Parties in English sufficiently in advance to allow the Parties to make their comments and give their approval (which will not be unreasonably withheld) on such closing documents.

5.2.       Decisions of the JV Company

 

(a)           On the Closing Date, and subject to the terms of Section 3.2.3(ii) , the meeting of the shareholders of the JV Company, as convened under Section 4.1.1(d) , shall vote with respect to:

 

(i)        the approval of the Contribution Auditor’s report with regard to the valuation of the Plug Power Contribution;

(ii)       the increase of the share capital of the JV Company and the issuance of the relevant number of shares representing 55% of the share capital of the JV Company, on a fully diluted basis, in favor of Axane in consideration of the Axane Contribution;

(iii)      the increase of the share capital of the JV Company and the issuance of the relevant number of shares representing 45% of the share capital of the JV Company, on a fully diluted basis, in favor of Plug Power in consideration of the Plug Power Contribution;

(iv)      the change of the corporate name of the JV Company to Hypulsion;

(v)       the change of the registered office of the JV Company to Sassenage;

 (vi)     the approval of the Articles of Association; and

(vii)     the designation of the members of the Board of Directors in accordance with the terms of Section 14.3.1 below.

(b)           On the Closing Date, the newly designated Board of Directors shall hold a meeting to appoint the Chairman, the Vice Chairman and the President of the JV Company in compliance with the terms of Article XIV below.

 

5.3.          Plug Power Closing Deliveries .  Subject to the delivery by Axane of the documents referred to in Section 5.4 , Plug Power shall deliver to Axane at Closing all of the following:

(a)          a certified copy of the resolutions of the Board of Directors of Plug Power approving the transactions contemplated herein and the relevant Ancillary Agreements;

                                                                           

 

 

 

(b)           a certified copy of the power and authority of the individual(s) acting on behalf of Plug Power for the purposes of this Agreement, the Ancillary Agreements and the Plug Power Contribution;

(c)           a certified copy of the Contribution and License Agreement;

(d)           original copies of each of the Ancillary Agreements to which Plug Power or any of its Affiliates is a party, all duly executed by the legal representative(s) of Plug Power and/or its Affiliates; and

(e)           a certificate (in the form attached in Schedule 5.3(e) ) reiterating the absence of events referred to in Section 6.1(b) as at the Closing Date with respect to Plug Power.

5.4.          Axane’s Closing Deliveries .  Subject to the delivery by Plug Power of the documents referred to in Section 5.3 , Axane shall deliver to Plug Power at Closing all of the following:

(a)           a certified copy of the resolutions of the competent corporate bodies of Axane approving the transactions contemplated herein and the relevant Ancillary Agreements;

(b)           a certified copy of the power and authority of the individual(s) acting on behalf of Axane for the purposes of this Agreement, the Ancillary Agreements and the Axane Contribution;

(c)           the resignation letters, effective as at the Closing Date, of all legal representatives of the JV Company;

(d)           a certified copy of the subscription form to the shares issued in consideration for the Axane Contribution;

(e)           original copies of each of the Ancillary Agreements to which Axane, any of its Affiliates and/or the JV Company, as the case may be, is a party, all duly executed by the legal representative(s) of Axane, any of its Affiliates and/or the JV Company, as the case may be;

(f)            a certificate confirming that the net equity value of the JV Company on the Closing Date is not less than EUR 10,000, together with the annual accounts of the JV Company for the financial year closed on December 31, 2011; and

(g)           a certificate (in the form attached in Schedule 5.3(e) ) reiterating the absence of events referred to in Section 6.1(b)(y) as at the Closing Date with respect to Axane.

5.5.           Issuance of Shares by the JV Company

5.5.1       Axane and Plug Power shall be the holders of the JV Company Shares in accordance with the terms of Section 11.1 below, and shall benefit from all the rights and obligations with respect to said JV Company Shares, in particular any and all voting rights and rights to dividends attached thereto, as of the Closing Date.

5.5.2.     The JV Company shall carry out, at its costs, all post-closing formalities required to render the above issuance of JV Company Shares and other shareholders decisions set forth in Section 5.2 binding on Third Parties. Axane and Plug Power undertake to assist the JV Company, if necessary, with respect to such formalities and execute any additional document which may be necessary with respect thereto.

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ARTICLE VI

CONDITIONS PRECEDENT

 

 

6.1.          The respective obligations of the Parties hereunder shall be subject to the satisfaction or waiver by Axane and by Plug Power of the following conditions precedent (the “ Conditions Precedent ”) on or prior to the Closing Date:

(a)          subject to the terms of Section 3.2.3 (and in particular, Section 3.2.3(ii) ), the obtaining of the report of the Contribution Auditor prior to the Closing Date and the completion, on the Closing Date, of the Axane Contribution and the Plug Power Contribution and the confirmation that the report of the Contribution Auditor does not value the Plug Power Contribution to less than EUR 4,037,000 (four million thirty seven thousand euros). For this purpose, the Parties and the JV Company shall take all reasonable actions to carry out the Axane Contribution and the Plug Power Contribution as soon as possible;

 

(b)          the absence of (i) any claim from any Third Party against Plug Power and/or the JV Company with respect to the Technology and IP Rights and (ii) any change or event which is unforeseeable as at the date hereof and outside any Parties’ control resulting immediately or in the future in a direct and certain material adverse effect on the financial condition or situation and the commercial perspective of the JV Company and/or any of the Parties (including any court-ordered or similar liquidation or restructuring with respect to any of the Parties);

 

(c)          the issuance by Silicon Valley Bank of a waiver in favor of Plug Power whereby Silicon Valley Bank (i) waives it rights under Plug Power’s obligation to pledge the JV Company Shares in its favor and (ii) allows Plug Power to pledge the JV Company Shares in favor of Axane and/or any Affiliate as provided in Section 10.4(h) .

 

6.2.          If on April 30, 2012 at the latest (or on any other date as shall be agreed upon by the Parties), the Conditions Precedent have not been satisfied or expressly waived by Axane and by Plug Power, this Agreement shall lapse and become null and void (except as concerns the confidentiality obligations) and no expenses or damages of any kind shall be due between the Parties, except in case of fraud or bad faith.

 

ARTICLE VII

REPRESENTATIONS AND WARRANTIES OF AXANE

 

Axane represents and warrants to Plug Power that each of the statements set forth below is and will be true and correct as at the date hereof and the Closing Date:

7.1.         Organization of the JV Company

(a)           The JV Company is a company duly incorporated under the form of a Société par Actions Simplifiée , organized, registered and validly existing under the laws of France;

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(b)          the JV Company has not carried out any business and has not incurred any direct or indirect liability (except for ordinary auditor and corporate secretarial expenses for a maximum global amount of EUR 40,000 euros since its constitution), whether actual or contingent, since its constitution; it has not taken over any acts performed prior to its constitution or registration. The net equity of the JV Company is not less than EUR 10,000;

(c)          except as provided herein, no Person has the right (exercisable now or in the future and whether contingent or not) to call for the issue of any share in the JV Company, which shall be composed, immediately prior to the Closing, of 5,000 (five thousand) shares, all ordinary and fully paid up (subject to any potential share cancellation to take place prior to the Axane Contribution); and

(d)          immediately prior to the Closing, Axane will be the sole legal and beneficial owner of the shares of the JV Company.

7.2.          Organization of Axane .  Axane is a company duly organized, incorporated and validly existing under the laws of France with full power to conduct its business as conducted as at the date of this Agreement. Axane is not and has not been subject to any court-ordered or similar liquidation or restructuring ( procédure collective ) and has not and will not, on the Closing Date, have suspended its payments or made any voluntary arrangement with its creditors. To Axane’s knowledge, no any such suspension or arrangement is likely to arise.

7.3.          Authority of Axane .  The execution, delivery and performance of this Agreement and the relevant Ancillary Agreements by Axane have been duly authorized and approved by the competent corporate bodies of Axane and do not require any further authorization or consent by Axane or its shareholders. This Agreement and the relevant Ancillary Agreements will, when executed, constitute valid and binding obligations of Axane.

7.4.         No Violation; Consents and Approvals

(a)          Neither the execution nor the delivery of this Agreement and the relevant Ancillary Agreements nor the performance by Axane of its obligations under this Agreement and the relevant Ancillary Agreements shall, whether by the giving of notice or upon the expiration of a time-limit, or both, conflict with any other agreement, result in a default or loss of rights of any kind, or result in the creation of any Encumbrances.

(b)          Neither the execution, the delivery of this Agreement and the relevant Ancillary Agreements, nor their performance by Axane shall contravene or violate any Requirements of Law and/or Court Orders of any Public Authority.

 

ARTICLE VIII

REPRESENTATIONS AND WARRANTIES of Plug power

 

Plug Power represents and warrants to Axane that each of the statements set forth below is and will be true and correct as at the date hereof and the Closing Date:

8.1.         Organization of Plug Power .  Plug Power is a company duly organized, incorporated and validly existing under the laws of the State of Delaware with full power to conduct its business as conducted as at the date of this Agreement. Plug Power is not and has never been subject to any court‑ordered or similar liquidation or restructuring. The fair salable value of Plug Power’s assets (including, to the extent it has any fair salable value, goodwill minus disposition costs) exceeds the fair value of its liabilities.  Plug Power is now and will be on the Closing Date able to pay its debts (including trade debts) as they mature.

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8.2.          Authority of Plug Power .  The execution, delivery and performance of this Agreement, the Contribution and License Agreement and the relevant Ancillary Agreements by Plug Power have been duly authorized and approved by the competent corporate bodies- of Plug Power and do not require any further authorization or consent by Plug Power or its shareholders. This Agreement, the Contribution and License Agreement and the relevant Ancillary Agreements will, when executed, constitute valid and binding obligations of Plug Power.

8.3.          No Violation; Consents and Approvals

(a)           Neither the execution nor the delivery by Plug Power of this Agreement, the Contribution and License Agreement and the relevant Ancillary Agreements nor the performance by Plug Power of its obligations under this Agreement, the Contribution and License Agreement and the relevant Ancillary Agreements shall, whether by the giving of notice or upon the expiration of a time-limit, or both, constitute an event of default under any agreement by which Plug Power is bound.

(b)           Neither the execution, the delivery by Plug Power of this Agreement, the Contribution and License Agreement and the relevant Ancillary Agreements, nor their performance by Plug Power shall contravene or violate any Requirements of Law and/or Court Orders of any Public Authority.

8.4.          Intellectual Property

(a)           Plug Power validly owns all the rights, title and interest in and to the Technology and IP Rights pursuant to the laws governing such Technology and IP Rights (as further described in the Schedules to the License Agreement) free and clear of any Encumbrances.

(b)           No claim has been asserted or Action has been initiated or threatened by any Third Party (or, to the knowledge of Plug Power, is likely to arise) which challenges Plug Power’s rights in the Technology and IP Rights, or alleges that the Technology and IP Rights are invalid, unenforceable, or that the Technology and IP Rights or the use thereof by Plug Power or its Affiliates are infringing the intellectual property rights of any such Third Party.

(c)           No licenses on the Technology and IP Rights have been granted to a Third Party or any Affiliate of Plug Power with respect to the Territory.  All other licenses granted by Plug Power on the Technology and IP Rights are disclosed in Schedule 8.4(c) hereto.

(d)           Subject to the terms of the License Agreement, the JV Company will have, upon Closing, access to all  documents and materials owned by Plug Power that document, describe or embody the Technology and IP Rights or the subject matter thereof sufficient to permit the JV Company to exercise its rights pursuant to the License Agreement.

 

 

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ARTICLE IX

INDEMNIFICATION

 

 

Without prejudice to each Party’s right to seek indemnification (the “ Indemnified Party ”) from the other Party (the “ Indemnifying Party ”) for any other breach of its undertakings under this Agreement, the Contribution and License Agreement and/or the Ancillary Agreements, the Indemnifying Party undertakes to indemnify and hold the Indemnified Party harmless from and against the Losses and Expenses incurred by the Indemnified Party and/or the JV Company arising from any breach, inaccuracy of, or omission in, any representation or warranty of the Indemnifying Party contained in Article VII (with respect to the representations and warranties of Axane) or Article VIII (with respect to the representations and warranties of Plug Power) herein.

 

ARTICLE X

ADDITIONAL UNDERTAKINGS

 

 

10.1.        Non Compete .           

 

(a)          The Parties agree that they will not carry out, take any interest or engage - in the Territory - in any capacity whatsoever (including as a minority shareholder), whether directly or indirectly and for as long as they remain shareholders of the JV Company, in any development and/or sales activity directly competing with the Project.  

(b)          Paragraph (a) above shall not prevent Plug Power from directly pursuing specific opportunities falling within the scope of the Project with customers located within the Territory. Plug Power shall however give prior written notice thereof to and request the JV Company whether the JV Company wants to pursue this opportunity.  For this purpose, Plug Power shall provide the JV Company in writing with a preliminary assessment of the main features of the contemplated customer arrangement, including, if available, information regarding the customer requirements and the transaction terms and conditions. The Board of Directors of the JV Company shall have fourteen (14) Business Days following receipt of the above notification to make a decision as a Reserved Matter to accept that Plug Power pursues this opportunity independently of the JV Company. 

If the Board of Directors decides not to pursue this opportunity itself, it shall give Plug Power a written waiver of the JV Company's exclusivity within the above time period. Said waiver shall cover the particular customer for the specific site referred to in the information provided to the JV Company, it being specified that any future arrangement with the same customer but relating to a different site of the customer in the Territory shall follow the same process and be submitted to the JV Company. Such waiver shall further not be unreasonably withheld by the JV Company. Failure of the JV Company to issue a written response within the above fourteen (14) Business Day period shall mean that the JV Company does not wish to pursue the opportunity and that Plug Power is free to pursue its initiative independently of the JV Company.  If the JV Company initially decides to pursue the opportunity but thereafter at any time stops the related discussions with the customer or the discussions between the customer and the JV Company cease definitively and the JV Company decides not to conclude the transaction, it shall inform Plug Power thereof and Plug Power shall again be free to further pursue such opportunity on its own.

 

 

 

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(c)          The provisions of this Section 10.1 shall not prevent the Parties from carrying on their respective existing activities outside the scope of the JV Company (including, for the avoidance of doubt, the supply and sale by any entity of the Air Liquide group of hydrogen gas and/or hydrogen refueling stations and/or hydrogen production units to any Third Party, whether or not in the handling market, and fuel cell systems outside of the handling market in the Territory and fuel cell systems in the handling market outside of the Territory). For the avoidance of doubt, the JV Company shall, within the scope of the Project and within the Territory, be free to enter into any commercial arrangement with a customer which secures its hydrogen gas supply, solutions and stations from competitors of the Air Liquide group. Without prejudice to Section 13.2 Plug Power shall be free to enter into any relationship with any competitors of the Air Liquide group outside the scope of the Project and/or outside the Territory.

(d)           In the event of the exercise of the IP Claim Put Option, the First Put Option and/or the Second Put Option, the Parties shall negotiate in good faith and seek to agree on the terms of a distribution agreement whereby Axane and/or its Affiliate may distribute GenDrive units in the Territory. 

 

10.2.        Non Solicitation . The Parties agree for themselves and for any of their Affiliates that they and their Affiliates will not, for as long they remain Parties to this Agreement shareholders of the JV Company and during a period of three (3) years thereafter, whether directly or indirectly:

 

(a)          solicit or entice away or knowingly encourage any of the executive employees ( cadres ) or corporate officers of the JV Company or of the other Party or its Affiliates or initiate any contact with any of the executive employees ( cadres ) or corporate officers of the JV Company or of the other Party or its Affiliates either to leave his or her employment position (whether or not the employee would, by leaving, commit a breach of his or her employment contract) or office in the JV Company or in the other Party or its Affiliates; or

(b)          employ any of the executive employees ( cadres ) or corporate officers of the JV Company or of the other Party or its Affiliates or call upon the services of such a person in a professional capacity (e.g., independent consultant, employee, director, corporate officer, shareholder, partner).

The terms of this Section 10.2 shall not be construed as prohibiting any of the Parties to seek to employ any of the employees or corporate officers of the JV Company which initially were the relevant Party’s own employees or corporate officers.

 

10.3.       The Parties acknowledge that compensatory remedies under law may not be adequate with respect to a breach of the prohibitions contained in Sections 10.1 and 10.2 regarding non competition and non solicitation.  Accordingly, it is the intention of the Parties that such prohibitions be specifically enforced in every respect.

 

10.4.        IP Study and IP Claims

 

(a)           Within thirty (30) days of Closing, the JV Company shall hire a counsel admitted to practice before the European Patent Office, chosen by the Parties, having experience relevant to the Technology and IP Rights (the “ Study Counsel ”) to perform a study of Third Party intellectual property rights potentially relevant to the development and sale of integrated cost competitive hydrogen fuel cell systems for and to the European handling market (the “ Study ”).  Within fifteen (15) days of their hire, Study Counsel shall propose to the JV Company and the Parties a process, timeline, and cost for conducting the Study (the “ Study Proposal ”) with results to be returned on or before June 1, 2012.  The Parties and the JV Company shall discuss the Study Proposal, with Study Counsel beginning work on the Study once the Parties and the JV Company have agreed to a final form of the Study Proposal.  The fees relating to the Study shall not exceed EUR 75,000 (seventy five thousand euros) and such fees shall be equally shared between Plug Power and Axane.  

 

 

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(b)          The Parties and the JV Company shall agree on and undertake commercially reasonable measures in response to issues or potential claims identified by the Study including, but not limited to, one or more of, in respect of a particular issue or potential claim: (i) no action at all, (ii) securing an opinion of counsel as to non-infringement or invalidity, (iii) obtaining a license of appropriate scope, and/or (iv) redesigning the Technology and IP Rights.

(c)           If a Third Party claim is made in writing on or before December 31, 2012 against the JV Company and/or Plug Power alleging that the Technology and IP Rights, the JV Company, and/or Plug Power, by reason of its activities with the JV Company, infringe a Third Party’s intellectual property right (a “ Third Party Claim ”), then the Parties and the JV Company shall discuss in good faith the commercially reasonable measures to respond to the Third Party Claim including, but not limited to, one or more of: (i) procuring for the JV Company the right to continue using the allegedly infringing subject matter, (ii) modifying the allegedly infringing subject matter to become non-infringing, (iii) defending such Third Party Claim and/or (iv) replacing the allegedly infringing subject matter with a non-infringing replacement. 

(d)           In the event that the Parties fail to reach an agreement on a commercially reasonable resolution to any such Third Party Claim within sixty (60) days following the notification of the Third Party Claim to the JV Company, Axane shall then have the right, but not the obligation, at the latest within ninety (90) days following the notification of the Third Party Claim to the JV Company, to give Plug Power notice (the “ IP Claim Put Option Notice ”) of the exercise by Axane of its option to sell the total amount of JV Company Shares held by Axane and/or its Affiliates as at such date for the price determined in Section 10.4(g) (the “ IP Claim Put Option ”).

(e)           Plug Power, within a thirty (30) day period following the date of the IP Claim Put Option Notice, may elect (the “ Indemnity Option Notice ”) to hold harmless the JV Company, Axane and its Affiliates against the Third Party Claim, defend and indemnify the JV Company, Axane and its Affiliates the full amounts of Losses and Expenses incurred as a result thereof (the “ Indemnity Option ”). Plug Power shall reimburse the JV Company, Axane and its Affiliates the amount of any indemnity in case the JV Company, Axane and any of its Affiliates are ordered to pay such amount by an enforceable court decision, subject to the right of Plug Power to receive any portion of such amount that would be repaid thereafter, interests included, to the JV Company, Axane and any of its Affiliates.

 

 

 

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In case Plug Power exercises its Indemnity Option, the IP Claim Put Option shall be deemed cancelled and the transfer of the Axane's JV Company Shares in accordance with the IP Claim Put Option shall not be completed. In the event that Plug Power agrees to the Indemnity Option, then Plug Power shall control all litigation, negotiation and settlements relating to the Third Party Claim with counsel of Plug Power’s choice, will bear all of the costs and expenses relating thereto and will reasonably take into account the commercial interests of the JV Company.  Plug Power shall not settle any Third Party Claim if such settlement contains a stipulation to, or an admission or acknowledgment of, any wrongdoing (whether in tort or otherwise) on the part of the JV Company or Axane without the affected party’s consent.

(f)           If Plug Power has not exercised its Indemnity Option, the Parties shall proceed to the transfer of the Shares pursuant to the IP Claim Put Option on a date to be agreed by Axane and Plug Power and no later than the ninetieth (90) day following the receipt by Plug Power of the IP Claim Put Option Notice (the “ IP Claim Put Option Transfer Date ”). On the IP Claim Put Option Transfer Date, Plug Power and Axane (or any designated Affiliate thereof) shall enter into a Share Transfer Agreement in the form of the draft attached hereto as Schedule 10.4(f) (the “ Share Transfer Agreement ”).  Plug Power shall pay all relevant transfer taxes ( droits d'enregistrement ), if any, due upon the transfer of the JV Company Shares. 

(g)          For the purposes of the IP Claim Put Option, the price to be paid by Plug Power to Axane for the relevant JV Company Shares (the “ IP Claim Put Option Price ”) on the IP Claim Put Option Transfer Date shall be equal to the paid-up nominal value of the JV Company Shares increased by the share premium paid in by Axane and/or its Affiliates as at such IP Claim Put Option Transfer Date.

(h)           As promptly as possible following the IP Claim Put Option Transfer Date and within three (3) months following said IP Claim Put Option Transfer Date at the latest, except if specified otherwise in this Agreement or any Ancillary Agreement (the “ Period ”) (i) all contracts (including, the Sublease Agreement and the Axane Operational Services Agreement), commitments, guarantees or other outstanding obligations binding on or issued by Axane and/or any of its Affiliates for the purposes of the activities of the JV Company, shall be terminated (and Axane shall accept and shall cause its Affiliates to accept such termination) and (ii) Plug Power shall substitute itself or any of its Affiliates to Axane and/or its Affiliates to the performance of any such outstanding obligation and/or the issuance of any such guarantee

For the purposes of this paragraph (h), the Parties shall seek to obtain the required consents of Oseo Innovation and the relevant beneficiaries under the H ₂ E Collaboration Program or otherwise and/or any other relevant Third Party and Axane shall provide its reasonable assistance to Plug Power in order to seek to complete this termination and substitution with a view to mitigate the adverse effect for the JV Company. This assistance shall however at no time be construed as an undertaking of Axane and/or any of its Affiliates to maintain certain guarantees, make any financial commitment and/or issue new guarantees.  

 

 

 

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Notwithstanding the above, if Oseo Innovation and/or the relevant beneficiaries decline to grant the appropriate consents under the H ₂ E Collaboration Program within the Period, Axane shall continue to provide the related guarantees issued by Axane and/or its Affiliates to Oseo Innovation on behalf of the JV Company, if and subject to Plug Power providing, within fifteen (15) days following the expiry of the Period, Axane and/or its Affiliates with (i) back-to-back guarantees covering all the obligations of Axane and its Affiliates towards Oseo Innovation resulting from the activities of the JV Company and (ii) a valid and enforceable pledge over all the JV Company Shares held by Plug Power and/or its Affiliates as a security for the obligations resulting from such back-to-back guarantees. The above mentioned guarantees, back-to-back guarantees and associated pledge shall cease to exist and be released upon the full satisfaction of all the obligations of the JV Company towards Oseo Innovation under H ₂ E Collaboration Program.  The Parties shall make their best efforts to obtain the release of Axane and its Affiliates from any and all their obligations under any outstanding guarantee(s) in the event Plug Power and/or its Affiliates cease to be collectively the majority shareholder of the JV Company.

 

The obligations of the Parties under this Section 10.4(h) are referred to hereafter as the “ Termination Obligations ”).

 

 

10.5.       Circuit breaker

 

(a)           As soon as possible after the signing of this Agreement, the Parties shall seek, and cause the JV Company to seek, the Oseo Approval in accordance with Section 2.3.1(e) ;

(b)          Until the obtaining of the Oseo Approval, the JV Company shall carry out its business in accordance with the Business Plan and in particular, shall pay to the Parties or their Affiliates, as the case may be, any amounts due in respect of the Ancillary Agreements;

(c)           From the earlier of (i) the date on which Axane confirms to Plug Power that the Oseo Approval has not been obtained or (ii) June 30, 2012, if the Oseo Approval is not yet obtained by that date, the Parties shall work together in order to try to reach an agreement in good faith on the future of the JV Company, and in particular on any alternative way of financing the JV Company, subject always to the provisions of Article III and Article XV . From this date forward, the JV Company shall not incur any new expenses (except continued labor expenses) until the prior written approval of the Parties on a revised budget (including financing plan) with respect to the JV Company;

(d)           If the Oseo Approval is not obtained by September 30, 2012, either Party may within a thirty (30) day period following September 30, 2012, notify to the other Party (a “ Wind-Up Notice ”), that the JV Company be wound up. Following any Wind-Up Notice, the Parties will (i) consult each other and each use their commercially reasonable efforts to complete such winding-up in an orderly fashion as soon as possible, (ii) vote at any shareholders meetings the dissolution of the Company and the appointment of a liquidator, and (ii) take all necessary actions to terminate the Ancillary Agreements (and the License Agreement in particular), as soon as possible;

(e)           The financial resources of the JV Company, including the Axane Contribution to the extent necessary, shall be used to cover any liabilities of the JV Company and liquidation costs, which will include any direct inventory costs resulting from the JV Company orders, incurred by Plug Power until the date of the Wind-Up Notice;

(f)            Upon the dissolution, any JV Company IP developed by the JV Company shall become the property of Plug Power only, without any obligation to grant a license to Axane, as an exception to Section 18.3 ;

(g)           for a period of three (3) years from the liquidation effective date, Axane and any of its Affiliates shall not carry out, take any interest or engage in the Territory, in any capacity whatsoever (including as a minority shareholder), whether directly or indirectly, in any development and/or sales activity competing with the Project as an exception to Section 10.1;

(h)           For the avoidance of doubt, Plug Power shall not be bound by any non-compete obligation as from the dissolution effective date.

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ARTICLE XI

CAPITAL AND SHARES OF THE JV COMPANY

 

 

11.1.      Share Capital of the JV Company

 

11.1.1      Immediately after the Closing Date and subject to Section 3.2.3(ii) , the share capital of the JV Company shall be divided into the relevant number of the JV Company Shares to remunerate the Axane Contribution and the Plug Power Contribution and which shall be allocated between Axane and Plug Power on a respective 55% and 45% basis.

 

11.1.2      For the purposes of Title II to this Agreement, Axane, Plug Power and any future shareholder of the JV Company shall collectively be referred to as the “ Shareholders of the JV Company ”.

 

11.2.        Transfer of the JV Company Shares

 

11.2.1     Transfer of the JV Company Shares to Affiliates

(a)          The Shareholders of the JV Company shall have the right to Transfer all or a portion of the JV Company Shares to any of their respective Affiliates, it being specified that in the case of such a Transfer, the transferring Shareholder of the JV Company shall not be released from any of its obligations hereunder (a “ Permitted Transfer ”).

(b)          In the case of a Permitted Transfer, the Affiliate concerned shall (x) adhere without any reserve or limitation to the terms of this Agreement and shall expressly undertake all of the obligations of the transferring Shareholder of the JV Company (while not releasing such transferring Shareholder) and (y) sign all relevant legal documentation to ensure that should the transferring Shareholder of the JV Company cease to control such Affiliate, said Affiliate shall be obligated to reassign the transferred JV Company Shares to the initial transferring Shareholder of the JV Company.

11.2.2     Transfer of the JV Company Shares to Third Parties

(a)           Lock-Up Period

No Party may, without the prior written approval of the other Party (which may be withheld at the sole discretion of each such Party), Transfer all or a portion of the JV Company Shares to any Third Party between the Closing Date and December 31, 2013. Any purported Transfer in violation of this Section 11.2.2(a) shall be void.

 

(b)          Pre-emption Right

As from January 1, 2014, any Transfer of the Shares of the JV Company to any Third Party other than a Permitted Transfer shall be subject to the following conditions:

 

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(i)            a Shareholder of the JV Company wishing to Transfer all or part of its JV Company Shares to a Third Party (the “ Selling Shareholder ”) shall give a notice in writing (a “ Transfer Notice ”) to the other Parties and to the Board of Directors, specifying the number of shares for which the transfer is planned (the “ Offered Shares ”) and the price offered and if applicable, other materials terms offered by the Third Party purchaser (the “ Third Party Purchaser ”) to the Selling Shareholder.

 

Each Shareholder of the JV Company shall have a preemption right to purchase the Offered Shares at the purchase price and other terms specified in the Transfer Notice.  Each Shareholder of the JV Company shall, within thirty (30) days (as from the date of receipt of the notification from the Selling Shareholder) notify in writing to the Selling Shareholder and the Board of Directors its intention to purchase the Offered Shares (specifying the number thereof) at the purchase price and other terms specified in the Transfer Notice.

 

In the event that all or part of the Offered Shares are not purchased by the Shareholders of the JV Company at the end of the above process, the Selling Shareholder shall be free to Transfer all of the Offered Shares to the Third Party Purchaser within a period of sixty (60) days following the notification to be addressed to the Selling Shareholder by the Chairman or the Vice Chairman confirming that all or part of the Offered Shares have not been purchased by the Shareholders of the JV Company;

 

(ii)       Plug Power hereby specifies that the Transfer of all or portion of its JV Company Shares to any Third Party or, if applicable to Axane and/or any of its Affiliates, shall not affect in any way whatsoever the rights of the JV Company over the Technology and IP Rights as resulting from the License Agreement, subject always to the provisions of this Agreement.

 

(iii)       subject to the limitations contained in paragraph (i) above, the Transfer by Axane of any of its JV Company Shares to a Third Party shall be subject to the following provisions:

 

-      the Third Party Purchaser shall not conduct nor have a majority interest in a company which conducts business activities which directly or through an Affiliate compete with the activities of the JV Company or of Plug Power or its Affiliates;

 

-      by adhering to the Agreement under the terms of paragraph (vi) below, the Third Party Purchaser shall irrevocably undertake to satisfy Axane’s outstanding obligations under Section 3.1.1 (including paying up any outstanding capital contributions) and Article XII hereto;

 

-     as a prior condition to the Transfer, the Third Party Purchaser shall undertake, if, as a result of the Transfer of any JV Company Shares by Axane and/or any of its Affiliates to a Third Party, Oseo Innovation or any other funding Public Authority notifies the JV Company of its decision to terminate any outstanding funding commitment, to contribute to the JV Company the equivalent of any such terminated Oseo Innovation and/or other Public Authority funding;

 

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(iv)      subject to the limitations contained in paragraph (i) above, Plug Power shall in no event seek to Transfer nor Transfer any of its JV Company Shares to any entity of the Linde, Air Products and/or Praxair groups;

 

(v)       as a prior condition to any Transfer, the Selling Shareholder shall cause the Third Party Purchaser to adhere to the terms of the Agreement and endorse any undertakings of the Selling Shareholder by executing an adhesion certificate (the “ Adhesion Certificate ”) substantially in the same form of the draft attached as Schedule 11.2.2(b)(v) hereto; and

 

(vi)      any Transfer of the JV Company Shares made in violation of the provisions of this Section 11.2.2(b) shall be null and void and shall not be binding on the JV Company.

 

11.2.3    Transfer of non fully paid up JV Company Shares

(a)              If, pursuant to Articles X, XI and/or XII or under any other provision of the Agreement, Axane transfers to Plug Power all or part of its JV Company Shares which are not fully paid up, Plug Power hereby undertakes to:

 

(i)        take over any outstanding payment obligations attached to the JV Company Shares (and hereby automatically releases Axane and/or its Affiliates from any such obligations);

 

(ii)       indemnify Axane and/or its Affiliates in case, following any claim made by the JV Company and/or any Third Party, Axane and/or its Affiliates has to pay any such outstanding amount, for the amount actually paid by Axane and/or its Affiliates (i.e., any such outstanding amount plus interest, if any); and

 

(iii)       fully indemnify Axane and/or its Affiliates against any Expenses incurred as a result of any failure by Plug Power to perform its obligations under (i) above and/or of any claim referred to in (ii) above;

 

all in addition to the Termination Obligations of the Parties and without prejudice to the right of Plug Power and of any subsequent transferee of the JV Company Shares (i) to decide to reduce the capital and the outstanding payment obligations, such decision being taken in accordance with applicable law after the transfer of the Shares by Axane and/or its Affiliates, and/or (ii) to seek indemnification from any subsequent transferee of such JV Company Shares, if any.

 

(b)              Axane shall notify Plug Power of any claim made by the JV Company and/or a Third Party referred to in paragraph (a) above.  Unless Axane receives, within fifteen (15) days of such notification, (i) written instructions from Plug Power not to pay any amount under such claim nor incur any related Expenses, (ii) together with valid justification that any such amount is not due, Axane shall be free to settle such claim and satisfy any payment thereunder, all without prejudice to its rights to indemnification under paragraph (a) above.   

 

11.2.4    If, pursuant to Articles X, XI and/or XII or under any other provision of the Agreement, Axane transfers to Plug Power all of its JV Company Shares, Plug Power shall cause the JV Company to leave the facilities occupied under the Sub-Lease Agreement in accordance with Section 2.4(b) . 

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ARTICLE XII

CALL AND PUT OPTIONS

 

12.1.       Call Options

 

12.1.1    First Call Option

 

(a)          Axane hereby grants to Plug Power an irrevocable option to purchase (the “ First Call Option ”) from Axane a number of JV Company Shares which would allow Plug Power to hold 65% of the share capital of the JV Company on a fully diluted basis. For the avoidance of doubt, Plug Power shall exercise its First Call Option on all the JV Company Shares (and not a portion only) held by Axane and/or its Affiliates which are required for Plug Power to hold 65% of the share capital of the JV Company on a fully diluted basis. Plug Power hereby accepts said First Call Option, as an option only.

 

(b)          As an exception to paragraph (a) above, if Axane has sold part of its JV Company to a Third Party pursuant to Section 11.2.2(b) , the First Call Option may be exercised on all (and not a portion only) of the remaining JV Company Shares held by Axane and/or any of its Affiliates on the exercise date of the First Call Option.

 

(c)          Plug Power may exercise the First Call Option at any time between January 4, 2016 and January 29, 2016 (the “ First Call Option Period ”).

 

(d)          For the purposes of the exercise of the First Call Option, Plug Power shall send, within the First Call Option Period, a written notice (the “ First Call Option Notice ” ) to Axane.  Said First Call Option Notice shall set forth (i) the number of JV Company Shares Plug Power wishes to purchase, and (ii) the formula chosen by Plug Power for the purpose of the calculation of the First Call Option Price, in compliance with the terms of paragraph (g) below.

 

(e)          On a date to be agreed by Axane and Plug Power and not later than the 45 ^th (forty-fifth) Business Day following date of the First Call Option Notice (the “ First Call Option Transfer Date ”), Plug Power and Axane (or any designated Affiliate thereof) shall enter into a Share Transfer Agreement in the form of the draft attached hereto as Schedule 10.4(f) .  Plug Power shall pay all relevant transfer taxes ( droits d'enregistrement ), if any, due upon the transfer of the Shares. If required, Plug Power shall be entitled to apply for the Transfer Registration pursuant to Section 12.1.4 below.

 

(f)           As promptly as possible after the First Call Option Notice but without constituting a condition precedent to the transfer of the JV Shares under the First Call Option, the Parties shall perform the Termination Obligations in accordance with Section 10.4(h) above.

 

(g)           For the purposes of the First Call Option, and subject to the terms of Section 12.2.2(g) pertaining to the Revised Second Amount, the price to be paid by Plug Power to Axane for the relevant JV Company Shares (the “ First Call Option Price ”), shall, at Plug Power’s option (to be specified in the First Call Option Notice), be equal to:

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(i)      the “ Price Calculation no.1 ”: EUR 2,000,000 to be paid by Plug Power to Axane on the First Call Option Transfer Date plus a “ Second Amount ” equal to:

 

         “Percentage of Called Shares” x (8 x “2020 EBITDA”) – EUR 2,000,000

 

          or ;

 

(ii)     the “ Price Calculation no.2 ”: EUR 4,000,000 to be paid by Plug Power to Axane on the First Call Option Transfer Date plus a “ Second Amount ”  equal to:

 

         “Percentage of Called Shares” x (5 x “2020 EBITDA”) – EUR 4,000,000.

 

(h)          Between the date of the First Call Option Notice and December 31, 2020, Plug Power shall not do or omit to do and shall procure that no member of the Plug Power group does or omits to do anything with the intention of materially adversely affecting the amount of the First Call Option Price (e.g., including or seeking to include any extraordinary or non recurring items, shifting any revenue or cost of the Plug Power group companies).

(i)           Without prejudice to paragraph (h) above, Plug Power shall notify Axane of any exceptional reorganization or transaction (such as a merger, an acquisition and/or the sale or disposition of assets) to be implemented at JV Company level which is likely to have an impact on the 2020 EBITDA, at least forty five (45) days prior to the implementation of any such reorganization or transaction. Upon receipt of such notification and should such transaction be reasonably expected by Axane to have a material impact on the 2020 EBITDA, Axane shall be entitled to perform at its costs a financial audit of the Company in accordance with Section 14.7.2 below within a period of three (3) weeks with the objective of understanding the JV Company and its activities in a way to enable the Expert (as such term is defined in Section 12.3(b) below) to render a decision in the case of a dispute between the Parties on the 2020 EBITDA (and consequently on the First Call Option Price).  The notes and reports of the auditor appointed by Axane shall be shared between the Parties.  In case of any dispute on the potential impact of any such exceptional reorganization or transaction on the 2020 EBITDA (and consequently on the First Call Option Price), the Expert shall be required, in compliance with the terms of Section 12.3 below, to determine what the 2020 EBITDA (and the First Call Option Price) would have been but for any such exceptional reorganization or transaction. 

(j)           For the avoidance of doubt, the payment obligation of the above First Call Option Price as well as the obligations stated in the preceding paragraphs shall be binding on Plug Power whether or not Plug Power remains the majority shareholder of the JV Company in 2021.  In the event Plug Power sells all or part of its JV Company Shares to a Third Party in compliance with the terms herein, Plug Power shall cause said Third Party to enter into an agreement by which said Third Party would allow the Parties to comply with the terms of this Section 12.1.1 and of Section 12.3 .  Any other outstanding amounts due by Plug Power and/or the JV Company to Axane or its Affiliates under any shareholder loan, any of the Ancillary Agreements or otherwise hereunder shall be fully paid prior to or, with the consent of Axane, immediately after, such share sale to the Third Party.

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(k)          Subject to the terms of Section 12.2.2(g) , the Parties agree that:

-          if, whether under paragraph(s) (i) or (ii) above, the Second Amount is a negative amount, no payment shall be due by Axane to Plug Power;

 

-         “ 2020 EBITDA ” shall mean earnings before interest, taxes, depreciation and amortization of the JV Company for the financial year ending on December 31, 2020. The EBITDA amount shall be the amount as reflected in the audited and certified accounts of the JV Company to be prepared as at December 31, 2020 (the “ 2020 Accounts ”) for the preceding twelve-month period, using the same accounting principles as those used for the previous financial year.  Plug Power shall use its powers as shareholder of the JV Company to ensure that the above 2020 Accounts be prepared and certified within a maximum period of three (3) months following January 1, 2021.  The costs (including auditor’s fees) incurred to establish the above 2020 Accounts shall be borne by the JV Company;

 

-         “ Percentage of Called Shares ” shall mean, with respect to the First Call Option or the Second Call Option, as the case may be, the ratio between (x) the number of JV Company Shares sold by Axane under the First Call Option or the Second Call Option, as the case may be, and (y) the total number of JV Company Shares;

 

-           the Second Amount, whether under (i) or (ii) above, shall be paid by Plug Power to Axane or its Affiliates within thirty (30) days following the certification of the 2020 Accounts.

 

12.1.2     Second Call Option

 

(a)          Subject to the exercise by Plug Power of the First Call Option as provided in Section 12.1.1 above (it being specified that the failure of Plug Power to exercise the First Call Option shall be deemed an irrevocable waiver to exercise the Second Call Option), Axane hereby grants to Plug Power an irrevocable option to purchase (the “ Second Call Option ”) from Axane and/or its Affiliates a number of JV Company Shares which would allow Plug Power to hold 80% of the share capital of the JV Company on a fully diluted basis. For the avoidance of doubt, Plug Power shall exercise its Second Call Option on all the JV Company Shares (and not a portion only) held by Axane and/or its Affiliates which are required for Plug Power to hold 80% of the share capital of the JV Company on a fully diluted basis. Plug Power hereby accepts said First Call Option, as an option only.

 

(b)          As promptly as possible after the Second Call Option Notice, but without constituting a condition precedent to the transfer of the JV Shares under the Second Call Option, the Parties shall perform the Termination Obligations in accordance with Section 10.4(h) above.

(c)           Plug Power may exercise the Second Call Option at any time between the earlier of (i) thirty (30) days after the certification of the 2017 Accounts and (ii) May 31, 2018 (the “ Second Call Option Period ”).

 

(d)          For the purposes of the exercise of the Second Call Option, Plug Power shall send, within the Second Call Option Period, a written notice (the “ Second Call Option Notice ” ) to Axane.  Said Second Call Option Notice shall set forth the number of JV Company Shares Plug Power wishes to purchase and its calculation of the Second Call Option Price.

 

 

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(e)           On a date to be agreed by Axane and Plug Power and not later than the 45 ^th (fourty-fifth) Business Day following the date of the Second Call Option Notice (the “ Second Call Option Transfer Date ”), Plug Power and Axane (or any designated Affiliate thereof) shall enter into a Share Transfer Agreement in the form of the draft attached hereto as Schedule 10.4(f) .  Plug Power shall pay all relevant transfer taxes ( droits d'enregistrement ), if any, due upon the transfer of the Shares. If necessary, Plug Power shall be entitled to apply for the Transfer Registration pursuant to Section 12.1.4 below.

 

(f)            For the purposes of the Second Call Option, the price to be paid by Plug Power to Axane for the relevant JV Company Shares (the “ Second Call Option Price ”) on the Second Call Option Transfer Date shall be equal to:

 

“Percentage of Called Shares” x (6.5 x “2017 EBITDA”).

 

(g)           The Parties agree that:

 

-        “ 2017 EBITDA ” shall mean earnings before interest, taxes, depreciation and amortization of the JV Company for the financial year ending on December 31, 2017. The EBITDA amount shall be the amount as reflected in the audited and certified accounts of the JV Company to be prepared as at December 31, 2017 (the “ 2017 Accounts ”) for the preceding twelve-month period, using the same accounting principles as those used for the previous financial year.  Plug Power shall take all reasonable actions to ensure that the above 2017 Accounts be prepared and certified within a maximum period of four (4) months following January 1, 2018. The costs (including auditor’s fees) incurred to establish the above 2017 Accounts shall be borne by the JV Company;

 

-        “ Percentage of Called Shares ” shall have the meaning specified in Section 12.1.1(h) .

 

(h)           If Axane has sold a portion of its JV Company Shares to a Third Party before the Second Call Option Date, Plug Power shall exercise its Second Call Option in priority on the JV Company Shares held by Axane as at the date of the Second Call Option Notice and then, if applicable, on the JV Company Shares held by the Third Party Purchaser, it being specified, for the avoidance of doubt, that the Second Call Option may only be exercised on a total number of shares which would allow Plug Power to hold, via the exercise of the Second Call Option, 80% of the JV Company Shares on a fully diluted basis.

 

12.1.3     Shareholder Loans .  As a condition precedent to the transfer of the JV Company Shares under the above First Call Option and/or Second Call Option, Plug Power shall cause the JV Company to reimburse to Axane and/or its Affiliates, on the First Call Option Transfer Date and/or the Second Call Option Transfer Date, as the case may be, at the latest, any outstanding amount owed to Axane and/or its Affiliates by the JV Company under any shareholder loan granted in compliance with the terms herein and/or under any cash pooling arrangement. 

 

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12.1.4     Transfer Registration .  Without prejudice to the terms of Section 12.3(c) , in a situation where Plug Power has validly exercised its option to purchase pursuant to the provisions of this Sections 12.1 and 12.2 , yet where Axane (and/or any designated Affiliate thereof) has defaulted in the execution of its obligation to transfer the relevant portion of its JV Company Shares, Plug Power may deposit the First Call Option Price and/or the Second Call Option Price, as the case may be, on a escrow account open in the books of a reputable bank in France, with instructions to release the First Call Option Price and/or the Second Call Option Price to Axane and/or its Affiliates at first demand from Axane and/or any of its Affiliates.  In such case, the mere remittance to the JV Company, after the expiry of the maximum time period between the relevant Call Option Notice and the relevant Call Option Transfer Date of a copy of the relevant Call Option Notice, a certificate of Plug Power confirming that Axane (and/or any relevant Affiliate) has defaulted in the execution of its obligation to transfer JV Company Shares and a receipt from the escrow agent for the full amount of the First Call Option Price and/or the Second Call Option Price (including a confirmation that said amount is to be released to Axane and/or its Affiliates at first demand) shall be deemed a duly executed Share Transfer Agreement and shall cause the JV Company, which the JV Company hereby accepts, and any of its officer to immediately register the corresponding transfer of JV Company Shares in the shareholders registry ( registre des mouvements de titres ) and the relevant individual securities holders' accounts ( compte individuel d'actionnaire ), held by or for the JV Company (the “ Transfer Registration ” ).

 

12.2.        Put Options

 

12.2.1     First Put Option

 

(a)          Plug Power hereby grants to Axane an irrevocable option to require from Plug Power the purchase of all (but of all only) of the JV Company Shares held by Axane and/or its Affiliates as at the date of the exercise of said option (the “ First Put Option ”).  Axane hereby accepts said First Put Option, as an option only. 

(b)          Axane may exercise the First Put Option at any time between September 1, 2013 and September 15, 2013 (the “ First Put Option Period ”), it being specified, for the avoidance of doubt, that the exercise of the First Put Option shall release Axane from its payment obligations referred to in Section 3.1.2(c) . 

(c)          For the purposes of the exercise of the First Put Option, Axane shall send, within the First Put Option Period, a written notice (the “ First Put Option Notice ”) to Plug Power.  Said First Put Option Notice shall set forth the number of JV Company Shares Axane wishes to sell (which shall be all the JV Company shares then held by Axane or its Affiliates) and the First Put Option Price (as defined in paragraph (e)).

(d)          On a date to be agreed by Axane and Plug Power (and no earlier than January 6, 2014 and no later than January 23, 2014) (the “ First Put Option Transfer Date ”), Plug Power and Axane (or any designated Affiliate thereof) shall enter into a Share Transfer Agreement in the form of the draft attached hereto as Schedule 10.4(f) .  Plug Power shall pay all relevant transfer taxes ( droits d'enregistrement ), if any, due upon the transfer of the Shares.

(e)          For the purposes of the First Put Option, the total price to be paid by Plug Power to Axane for the relevant JV Company Shares (the “ First Put Option Price ”) shall be equal to EUR 1 (one euro).

(f)           As promptly as possible after the First Put Option Transfer Date, the Parties shall perform the Termination Obligations in accordance with Section 10.4(h) above.

12.2.2     Second Put Option

 

(a)          Plug Power hereby grants to Axane an irrevocable option to require from Plug Power the purchase of all (but of all only) of the JV Company Shares held by Axane and/or its Affiliates as at the date of the exercise of said option (the “ Second Put Option ”).  Axane hereby accept said Second Put Option, as an option only. 

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(b)          Axane may exercise the Second Put Option within the ninety (90) day period  following the first anniversary date of the date of execution of the relevant Share Transfer Agreement following the exercise by Plug Power of the First Call Option or the Second Call Option, as the case may be (the “ Second Put Option Periods ”). 

(c)          For the purposes of the exercise of the Second Put Option, Axane shall send, within any of the Second Put Option Periods, a written notice (the “ Second Put Option Notice ” ) to Plug Power.  Said Second Put Option Notice shall set forth (i) the number of JV Company Shares Axane wishes to sell (which shall be all the JV Company shares then held by Axane or its Affiliates), (ii) if known, its calculation of the Second Put Option Price, and (iii) if know, its calculation of the Revised Second Payment (as such term is defined in paragraph (g) below).

(d)          On a date to be agreed by Axane and Plug Power and no later than the 45 ^th (forty-fifth) Business Day following the receipt by Plug Power of the Second Put Option Notice (the “ Second Put Option Transfer Date ”), Plug Power and Axane (or any designated Affiliate thereof) shall enter into a Share Transfer Agreement in the form of the draft attached hereto as Schedule 10.4(f) .  Plug Power shall pay all relevant transfer taxes ( droits d'enregistrement ), if any, due upon the transfer of the Shares.

(e)          For the purposes of the Second Put Option, the price to be paid by Plug Power to Axane for the relevant JV Company Shares (the “ Second Put Option Price ”) shall be equal to the highest amount between:

(i)      the aggregate amount of the paid-in nominal value of the JV Company Shares sold upon the Second Put Option, plus any related share premium;

         and ;

(ii)     (5 x “Preceding Year EBITDA”) x “Percentage of Put Shares”.

(f)                The Parties agree that:

-          “ Preceding Year EBITDA ” shall mean earnings before interest, taxes, depreciation and amortization of the JV Company for the financial year ending on December 31 preceding the Second Put Option Notice. The EBITDA amount shall be the amount as reflected in the audited and certified accounts of the JV Company to be prepared as at December 31 of the year preceding the Second Put Option Notice (the “ Preceding Year Accounts ”) for the preceding twelve-month period, using the same accounting principles as those used for the previous financial year;

 

-           “ Percentage of Put Shares ” shall mean the ratio between (x) the number of JV Company Shares sold by Axane and/or its Affiliates under the Second Put Option and (y) the total number of JV Company Shares;

 

-           If the Preceding Year Accounts are not available as at the date of the Second Put Option Notice, the Second Put Option Transfer Date shall be postponed to the fifth (5 ^th ) Business Day following the date of the shareholders’ general meeting of the JV Company approving said accounts. The costs (including auditor’s fees) incurred to establish the above Preceding Year Accounts shall be borne by the JV Company.

 

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(g)          In addition to the Second Put Option Price, Plug Power shall pay, on the Second Put Option Transfer Date, to Axane and/or its Affiliates the Second Amount outstanding under the First Call Option, said Second Amount to be recalculated as follows (the “ Revised Second Amount ”):

-           in the event of the Second Put Option being exercised during fiscal year 2017 and:

• Plug Power decided to apply the Price Calculation no. 1, the Revised Second Amount shall be equal to (i) (8 x Preceding Year EBITDA) x Percentage of Call Option 1 Shares plus (ii) 26.5% of the total revenues of the JV Company as at December 31, 2016; or

• Plug Power decided to apply the Price Calculation no. 2, the Revised Second Amount shall be equal (i) (5 x Preceding Year EBITDA) x Percentage of Call Option 1 Shares plus (ii) 13.5% of the total revenues of the JV Company as at December 31, 2016;

-          in the event of the Second Put Option being exercised during fiscal year 2019 and:

• Plug Power decided to apply the Price Calculation no. 1, the Revised Second Amount shall be equal (i) (8 x Preceding Year EBITDA) x Percentage of Call Option 1 Shares plus (ii) 20% of the total revenues of the JV Company as at December 31, 2018; or

• Plug Power decided to apply the Price Calculation no. 2, the Revised Second Amount shall be equal to (i) (5 x Preceding Year EBITDA) x Percentage of Call Option 1 Shares plus (ii) 8.4% of the total revenues of the JV Company as at December 31, 2018;

-          Where:

• “ Percentage of Call Option 1 Shares ” shall mean the ratio between (x) the number of JV Company Shares sold by Axane and/or its Affiliates to Plug Power under the First Call Option and (y) the total number of JV Company Shares as at the First Call Option Transfer Date.

 

12.3.       Options Price Disputes

 

(a)          In the event the receiving Party disagrees with the calculation of the First Call Option Price (in particular with respect to the impact on the 2020 EBITDA as provided in Section 12.1.1(i) ), the Second Call Option Price, the First Put Option Price, the Second Put Option Price and/or the Revised Second Amount, as the case may be (together the “ Call or Put Option Price ” ) , said receiving Party shall, within fifteen days from (i) the receipt of the relevant Option Notice or (ii) the determination and notification thereof of the 2020 EBITDA, the 2017 EBITDA, the revenues of the JV Company as at December 31, 2016, the revenues of the JV Company as at December 31, 2018 and/or the Preceding Year EBITDA, as the case may be, and whichever the latest, notify to the other Party its disagreement with the Call or Put Option Price.  Failure by the receiving Party to notify the other Party of any such disagreement within the above fifteen day period shall be deemed an acceptance by the receiving Party of the Call or Put Option Price, as the case may be, and the corresponding amount shall be considered as final and binding between the Parties for all purposes.

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(b)          If the Parties fail to find an agreement on the Call or Put Option Price and do not resolve their differences with respect to the Call or Put Option Price within thirty (30) days of receipt of the notification of disagreement from the notified Party, the most diligent Party may require that such differences relating to the Call or Put Option Price be definitively resolved by a reputable firm of financial advisors (the “ Expert ”). If the Parties fail to appoint the Expert within fifteen days from the receipt of the most diligent Party’s notice, the Expert will be appointed by the President of the Paris Commercial Court ruling in final summary proceedings ( statuant en la forme des référés ) at the request of the most diligent Party. The Expert appointed hereunder shall act as an expert ( mandataire commun des parties) in accordance with article 1592 of the French Civil code with the mission to implement the provisions of this Agreement to the best possible extent and without any power or authority to apply on its own or at the request of a Party any equitable solution ( en équité ).  The Expert shall render a detailed decision within thirty (30) days as to the amount of the Call or Put Option Price.  The Expert’s decision shall be final and binding upon the Parties and the amount of the Call or Put Option Price shall not be subject to further challenge by the Parties save and except for gross mistake and/or willful misconduct of the Expert.  The fees and expenses of the Expert shall be borne equally between the Parties.

If the Expert refuses or cannot, for whatever reason, fulfill its mission, another expert shall be appointed in accordance with Article 1843-4 of the French Civil code  by the President of the Paris Commercial Court ruling in final summary proceedings ( statuant en la forme des référés ) at the request of the most diligent Party. 

 

(c)          In the case of any such disagreement (and except in case of disagreement with respect to the 2020 EBITDA), the relevant Transfer Date of the JV Company Shares, whether under the First and Second Call Option or the First and Second Put Option, shall be postponed to the fifteenth (15 ^th ) Business Day following the notification to both Parties of the Expert decision with respect to the Call or Put Option Price.

12.4.        Waiver of Article 1142 of the French Civil Code

 

(a)          The Parties expressly acknowledge that the allocation of damages in the event of a withdrawal or a failure to execute a Transfer of JV Company Shares in compliance with the terms herein following the exercise of the First Call Option, the Second Call Option, the First Put Option, the Second Put Option, the IP Claim Put Option and/or the put option under Section 13.2(b) will not be a remedy satisfactory to the relevant beneficiary of any such options.

(b)          As the provisions of Article 1142 of the Civil Code are not French public order rules, and pursuant to the provisions of Article 6 of the Civil Code, each Party hereby agrees, upon the exercise by the other Party of the relevant option, to Transfer the relevant number of JV Company Shares under the conditions of the Agreement and the Articles of Association of the JV Company and (i) represents and acknowledges that its commitment is, subject to the provisions of the Agreement, final and irrevocable, that it can not in any way be withdrawn by the relevant beneficiary before and after the exercise of the First Call Option, the Second Call Option, the First Put Option, the Second Put Option, the IP Claim Put Option and/or the put option under Section 13.2(b) , as the case may be, and (ii) waives the provisions of Article 1142 of the French Civil Code with respect to the First Call Option, the Second Call Option, the First Put Option, the Second Put Option, the IP Claim Put Option and/or the put option under Section 13.2(b).

12.5.         Hydrogen Activity

 

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For as long as Axane and/or its Affiliates remain Shareholder(s) of the JV Company, the JV Company will inform its customers that Air Liquide Hydrogen Energy offers hydrogen gas suited for the hydrogen fuel cell systems sold under the Project, whether as part of the Commercial Cooperation Agreement  or otherwise. 

 

 

ARTICLE XIII

CHANGE OF CONTROL

 

 

13.1.        In the event of a Change of Control of Axane or Plug Power, as the case may be, such Party shall notify such Change of Control to the other Party within fifteen (15) days of such Change of Control and provide reasonable information relating to the resulting ultimate shareholder of the relevant Party (the “ Change of Control Notice ”).

13.2.      Change of Control of Plug Power

(a)       If at any time when Axane owns JV Company Shares, Plug Power receives an unsolicited proposal to enter into a transaction that would, if consummated, constitute a Change of Control of Plug Power and would result in Plug Power being, directly or indirectly, controlled by any entity of the Linde, Air Products or Praxair group, Plug Power shall hire an appropriate financial advisor and  initiate an auction process and allow any relevant entity of the Air Liquide group to participate as a bidder in such process for the sale of its equity interest.

(b)       If as a result of a transaction, any entity of the Linde, Air Products or Praxair groups were to Control Plug Power:

-      Axane (and its Affiliates) shall have the right to require from Plug Power the purchase of all (but all only) of the JV Company Shares held by Axane and/or its Affiliates as at the date of receipt of the Change of Control Notice.  The put option right resulting from the above shall be exercised (as an option only) by Axane and its Affiliates within thirty (30) days following the receipt of the Change of Control Notice and the price payable by Plug Power to Axane and its Affiliates shall be equal to the Second Put Option Price.  For the purposes herein, the relevant parties shall enter into the relevant Share Transfer Agreement within fifteen (15) days following the notification by Axane of the exercise of the put option hereunder and Plug Power shall, on the same day, pay the relevant price hereunder plus, if applicable, the Revised Second Amount;

-      Plug Power shall cause, as part of said transaction, the relevant entity of the Linde, Air Products or Praxair groups to, within a period of thirty (30) days following the completion date of the Transfer of the JV Company Shares to Plug Power under the above put option, (i) offer to substitute any appropriate guarantee or commitment to any outstanding guarantee or commitment binding on or issued by Axane and/or any of its Affiliates for the purposes of the activities of the JV Company (in particular under the H²E Collaboration Program) and (ii) should substitution be rejected and for any amounts that would thereafter become due, cause the JV Company to pay back within the above thirty (30) days period any outstanding amount due and with respect to which any such guarantee or commitment has been issued or entered into in particular in the context of the H ₂ E Collaboration Program.

 

 

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(c)       Should Axane exercise the IP Put Option, the First Put Option or the Second Put Option and should – at any time between the relevant Put Option Notice and the relevant Put Option Transfer Date – Plug Power be involved in negotiations with a Third Party likely to lead to Plug Power’s Change of Control, Plug Power shall notify Axane thereof, together with information on the potential purchaser, subject to Plug Power’s confidentiality obligations in that respect. Upon receipt of such notification, the relevant Put Option Transfer Date shall be extended by twenty-one (21) days and Axane shall confirm to Plug Power – at the latest on the date of expiry of this twenty-one (21) day period – whether or not it cancels the exercice of the relevant Put Option. Failure by Axane to notify Plug Power within the above period shall be deemed a waiver by Axane of its right to cancel the exercise of the relevant Put Option.

 

13.3.       Change of Control of Axane

 

If at any time when Plug Power owns JV Company Shares, (i) Axane receives an unsolicited proposal to enter into a transaction that would, if consummated, constitute a Change of Control of Axane and (ii) Axane does not Transfer the JV Company Shares to any entity of the Air Liquide group prior to implementing such transaction, Axane shall hire an appropriate financial advisor and initiate an auction process to allow any relevant entity of the Plug Power group to participate as a bidder in such process.

 

ARTICLE XIV

GOVERNANCE AND MANAGEMENT OF THE JV COMPANY

 

 

14.1.        Articles of Association

 

The activities of the JV Company and the rights and obligations of the Shareholders of the JV Company, its directors and legal representatives shall be subject to applicable mandatory Requirements of Law, as well as subject to and governed by the Articles of Association, as amended from time to time in compliance with applicable Requirements of Law. 

 

14.2.        Meetings of the Shareholders

 

The meetings of the Shareholders of the JV Company (whether under their ordinary (50% plus one vote majority) or extraordinary form (two third majority)) shall be held in compliance with applicable Requirements of Laws and the Articles of Association.

 

14.3.        Board of Directors

 

14.3.1     Members of the Board of Directors

(a)          The JV Company shall be managed by a board of directors (the “ Board of Directors ”) composed of five (5) members to be designated in compliance with applicable Requirements of Laws and the Articles of Association. 

(b)          As long as a Party and its Affiliates collectively hold at least 50% of the share capital (and voting rights) of the JV Company plus one share, three (3) members of the Board of Directors shall be appointed by such Party. 

(c)          As long as a Party and its Affiliates collectively hold between one third plus one share and 50% of the share capital (and voting rights) of the JV Company, two (2) members of the Board of Directors shall be appointed by such Party.

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(d)          As long as a Party and its Affiliates collectively hold between 15 % and one third of the share capital (and voting rights) of the JV Company, one (1) member of the Board of Directors shall be appointed by such Party.

(e)          The Party having appointed any member of the Board may at any time notify the JV Company and the other Shareholders of the JV Company that such member is replaced by another member. Each Party shall use its reasonable endeavors to maintain the continuity of its representation to the Board of Directors.  The members of the Board of Directors may be dismissed by the shareholders’ meeting of the JV Company only for gross misconduct or in case the Party having appointed any such member does not hold anymore the proportion of the share capital (and voting rights) of the JV Company allowing such Party to appoint such member(s) pursuant to paragraphs (b), (c) or (d) above. 

(f)           The Parties undertake to exercise their voting rights as shareholders in compliance with the above.

14.3.2     Meetings and Decisions of the Board of Directors

(a)           Board of Directors meetings will be held (through any appropriate means) when and where required or necessary for the JV Company’s business.  Said meetings are to be called in compliance with applicable Requirements of Law and the Articles of Association and as a minimum four (4) times a year.

(b)          The decisions by the Board of Directors shall be made in compliance with applicable majority rules provided in the Articles of Association (i.e., a majority of one half plus one vote of the present members of the Board of Directors), except for the limitative decisions specified in Schedule 14.3.2(b) (the “ Reserved Matters ”) which in all case require a Board of Directors decision and said decision shall require a unanimous consent of the then appointed Board members for the first meeting of the Board of Directors deciding on such relevant Reserved Matter.  In the event of the failure of any of the Board members to participate to two consecutive Board of Directors meetings pertaining to any such Reserved Matter or to have the valid authority to vote at such two consecutive meetings, the decision relating to such Reserved Matter may be taken at the subsequent Board of Directors meeting with a unanimous consent of the Board members participating to such meeting and having the valid authority to vote.

(c)          Notwithstanding the above, after the First Call Option Transfer Date, the Reserved Matters list shall be limited:

-     until December 31, 2018 to items (d) ( Third Party capital contribution ), (e and r) ( Merger and wind-up ), (j) ( H²E Collaboration Program ) (u) ( Budget ) and (l) ( Project and other amendments ) of the list specified in Schedule 14.3.2(b) ,

-     then, until December 31, 2020 to items (j) ( H²E Collaboration Program ) and (u) ( Budget ) of the list specified in Schedule 14.3.2(b) , and

-     thereafter, to item (j) ( H²E Collaboration Program ) of the list specified in Schedule 14.3.2(b) , until full satisfaction of the JV Company's obligations under said H²E Collaboration Program.

The Articles of Association shall be amended accordingly.

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(d)          The Board of Directors shall designate a compensation committee which shall include at least one representative from Plug Power. The compensation committee shall meet as often as necessary and at least once a year. It shall approve the salaries of the top 5 employees of the JV Company.

14.4.        Chairman and Vice Chairman

 

(a)          The Chairman of the Board (the “ Chairman ”) shall be designated amongst the members of the Board of Directors appointed by the majority shareholder of the JV Company (and for the first time by Axane) and in accordance with the Articles of Association.  The Chairman shall have limited powers under the Articles of Association and shall in particular have the power to convene Board of Directors meetings. For the avoidance of doubt, the Chairman shall not have the power to bind the JV Company vis-à-vis Third Parties. The Parties agree that the first Chairman shall be Mr. Eric Prades.

(b)          The Vice Chairman of the Board (the “ Vice Chairman ”) shall be designated amongst the members appointed by the second larger shareholder of the JV Company (and for the first time by Plug Power) and in accordance with the Articles of Association.  The Vice Chairman shall have limited powers under the Articles of Association and shall in particular have the power to convene Board of Directors meetings. For the avoidance of doubt, the Vice Chairman shall not have the power to bind the JV Company vis-à-vis Third Parties. The Parties agree that the first Vice Chairman shall be Mr. Andy Marsh.

14.5.         President

 

(a)          The daily management of the JV Company shall be conducted by a President (the “ President ”).  Said President may or may not be a member of the Board of Directors and shall be appointed by the Board of Directors (as part of the Reserved Matters) amongst candidates proposed by the majority shareholder (and for the first time by Axane), the positive vote by the Board members representing the other shareholders not being unreasonably withheld or delayed. For the management of the Company, the President (i) may be assisted by one or several general manager(s) appointed by the Board of Directors (as part of the Reserved Matters) and (ii) shall be assisted by an Executive Committee ( comité de direction ) composed of the main officers of the JV Company.

(b)          The President and, as the case may be, the general manager(s) shall have the broadest powers to represent the JV Company vis-à-vis Third Parties. As an internal rule, they shall be instructed and will undertake vis-à-vis the JV Company and the Parties to obtain the prior approval of:

(x)       the Board of Directors for any Reserved Matters;

(y)      the Board of Directors for any capital expenditures and/or operating expenses listed in Schedule 14.5(b) hereto and which are, individually or annually (per type of expenditure or expense as listed in said Schedule), of a value or cost of more than a given threshold to be decided upon each year, at the time of the approval of the annual accounts, by the Board of Directors as a Reserved Matter (the “ Threshold ”); and

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(z)       one member of the Board of Directors appointed by the majority shareholder (initially Mr. Eric Prades) and one member of the Board of Directors appointed by the second largest shareholder (initially Mr. Andy Marsh) for any agreement to be entered into with a customer of an aggregate value per agreement (including underlying liability commitments of the JV Company) exceeding EUR 3,000,000, as well as any purchase order relating thereto. 

(c)           The Parties agree that the Threshold, for the period expiring on the date of approval of the accounts of the JV Company for fiscal year 2012, shall be equal to EUR 500,000 (five hundred thousand euros).

14.6.       Deadlock

 

In the event (i) the members of the Board of Directors and/or the Shareholders of the JV Company are unable to agree on one or more of the Reserved Matter decisions listed in Schedule 14.5(b) and the matters requiring a two-third or unanimous vote at the shareholders meeting during at least three Board of Directors meetings or two shareholders general meetings, as the case may be, and (ii) in the reasonable opinion of any of the JV Company Shareholders, such failure to agree thereon prevents the JV Company from continuing to efficiently operate, the Shareholders of the JV Company agree to come together as soon as reasonably possible and make their reasonable efforts, acting in good faith, to agree on a solution to such a deadlock situation.

 

14.7.       Information report

 

14.7.1     In addition to the rights granted to them by Requirements of Law, the Board of Directors shall procure that each Shareholder of the JV Company shall be provided with the following information including but not limited to:

 

(a)          monthly information reports providing information on the management and operations of the JV Company, including without limitation financial (P&L of the month, cash and debt situation at month end and forecast on the following month), headcount, technical and commercial information, together with comments made by the management on the above, as well as any information that has or will have (even subject to the completion of certain conditions) a material negative impact on the JV Company, its situation or perspectives or the performance of its budget or Business Plan;

(b)         quarterly information report providing information on sales by products and variance analysis;

(c)          bi-annual information report providing a pro-forma balance sheet and cash flow analysis, working capital analysis;

(d)          in addition to the annual information provided to shareholders of a French Société Anonyme , an annual information report providing information on the subsequent year objectives in terms of P&L, balance sheet, working capital requirements, cash flow, capex requirements,  headcount and debt situation. This yearly target shall be updated 5 times in the year within reforecast process.

The Parties acknowledge that time is of essence for the provision of such information.

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14.7.2     In addition, Parties holding at least 20% of the JV Company's share capital will be entitled to examine the books, accounts, registers, information or data relating to the JV Company and/or its subsidiaries (including, but not limited to, information regarding the JV Company's officers and staff and intellectual property), be given access to the facilities of the JV Company during regular business hours, upon reasonable notice, at any time, and to appoint not more than two times in one calendar year for such purpose a firm of accountants or other auditors or experts nominated by the concerned Party. The expenses incurred in this respect shall be paid in full by the relevant Party, unless such audit reveals any material discrepancy between the information provided by the JV Company to the concerned Party and the information collected during such audit, in which case the costs of such audit shall be borne by the JV Company. In any case, the JV Company shall be provided with a copy of each report established in such a context by the appointed firm of accountants, auditors or experts.

 

 

ARTICLE XV

FINANCING

 

15.1.       Debt financing . Subject to Section 15.2 below, the Parties agree that, if the JV Company needs to raise debt from a Third Party, the Parties shall not intervene in the financing as a guarantor. If the JV Company is unable to raise the funds which are required to implement the Project, and only to that extend, then one of the Parties may agree (but shall have no obligation) to give some form of guarantee to the lender of the JV Company until the JV Company is able to service its debt through its own generated cash flow. In case of exercise of any of the Call or Put Options, and should any such guarantee have been granted by the selling Party, the acquiring Party shall substitute any equivalent guarantee to the lender’s satisfaction as provided herein.

 

15.2.       Working capital requirements . Without prejudice to the obligations of Axane under Section 3.1 , the Parties agree that working capital requirements of the JV Company may be financed by debt subject to Section 15.1 and/or as long as Axane controls the JV Company, at Axane’s option, by participation of the JV Company to the “cash pooling” program of the Air Liquide Group.

 

15.3       Future capital contribution . Unless otherwise agreed, no capital increase shall be implemented by the JV Company until the full payment of the Axane Contribution.  Any future capital contribution to the JV Company shall be decided upon as a Reserved Matter and in accordance with the provisions of the Articles of Association.

 

For the avoidance of doubt, the Parties shall have no obligation to participate to any additional capital contribution to the JV Company (other than respectively the Axane Contribution and the Plug Power Contribution). The Parties may offer to participate to any additional capital contribution through the set-off with the remuneration of services provided by them to the JV Company under the Ancillary Agreements and/or, in particular as concerns Plug Power, through an additional contribution in kind of intellectual property rights which are not licensed to the JV Company under the License Agreement.

 

ARTICLE XVI

DIVIDENDS DISTRIBUTION

 

 

16.1.       Unless otherwise agreed (as a Reserved Matter), the Parties shall cause the JV Company to distribute each fiscal year a minimum of 75% of the net result of the JV Company as resulting from the financial statements certified by the statutory auditors, subject to the following conditions:

 

(a)           any such distribution shall comply with the applicable Requirements of Law;

 

 

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(b)          the JV Company shall fulfill its financial obligations with respect to contracts or agreements entered into with banking institutions or other companies;

 

(c)          the JV Company shall reserve the required amount of free cash flows in order to fund its future development pursuant to the steps provided for in the Business Plan, to maintain a stock of “capital spare parts” necessary to ensure maintenance and replacement of critical equipments, and to reserve for future warranty and contractual obligations;

 

(d)          the distribution of dividend by the JV Company shall not result in an increase of the existing debts of the JV Company at the time when the dividends distribution is being considered; and

 

(e)          the cash reserve of the JV Company shall after the envisaged distribution exceed the current financial year’s expected reimbursable subsidies, plus any interest on working capital that may be due.

 

16.2.        Notwithstanding the foregoing, the Parties may agree on a discretionary distribution of dividends as a Reserved Matter.

 

 

ARTICLE XVII

EFFECTIVE DATE AND TERM

 

 

17.1.       The provisions of Title I of the Agreement shall be binding and effective on the Parties as from the date hereof.  This Title II shall be binding and effective on the Parties as of the Closing Date.

 

17.2.       Subject to Sections 19.2.3 ,  and 10.2 and save in case of Transfer by one of Parties of all of its JV Company Shares (in which case said provisions shall, for the Party having  Transferred its JV Company Shares, terminate on the date of transfer of the relevant JV Company Shares), the provisions of this Agreement shall apply for a term of 15 years as from said Closing Date (save as otherwise agreed between the Parties).  In the event Axane and Plug Power remain Shareholders of the JV Company at the end of the above 15 year term, the provisions of this Agreement shall automatically be renewed for consecutive five (5) year terms (or if earlier, until the date Axane or Plug Power, as the case may be, cease to be Shareholders of the JV Company).

 

 

ARTICLE XVII

 

INTELLECTUAL PROPERTY RIGHTS

 

 

18.1.       Without prejudice to the terms of the License Agreement and, any licenses granted thereunder, and subject to the provisions of the Supply and Engineered Services Agreement and any permitted joint development agreements entered into by the JV Company in compliance with the terms herein , the JV Company shall be the sole owner of all technology, development and/or intellectual property rights created or developed by its employees, whether directly or indirectly (the “ JV Company IP ”).

 

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18.2.        Any decisions related to joint development agreements resulting in intellectual property rights being jointly owned with Third Parties and funding program agreements including intellectual property limitations to be entered by the JV Company shall be considered as Reserved Matters.

 

18.3.       In the case of the liquidation of the JV Company, and as part of the liquidation process, the Parties shall agree on whether (i) the ownership rights to the JV Company IP shall be transferred to both Plug Power and Axane, who shall become of co-owners of such JV Company IP or (i) the ownership rights to the JV Company IP shall be transferred to either Plug Power or Axane with a royalty free, non terminable, worldwide license being granted thereon to the other Party. 

 

ARTICLE XIX

GENERAL PROVISIONS

 

19.1.       No Public Announcement .   Neither Party shall, without the approval of the other Parties, make any press release or other public announcement concerning the transactions contemplated by this Agreement, except as and to the extent that any such Party shall be so obligated by law, in which case the other Parties shall be advised and the Parties shall use their best efforts to cause a mutually agreeable release or announcement to be issued; provided, however, that the foregoing shall not preclude communications or disclosures necessary to implement the provisions of this Agreement or to comply with the rules of any stock exchange.

 

19.2.        Confidentiality

 

19.2.1      Confidential Information . 

 

This Agreement will not be disclosed and will be kept confidential by each Party, except (i) for such disclosures to which the other Party has provided its prior written consent and (ii) that all or any portion of this Agreement may be disclosed by either Party to the extent required by law, including but not limited to the rules and regulations of the United States Securities and Exchange Commission and/or the French AMF, and/or to the extent required by Oseo Innovation.

 

Each Party undertakes to keep confidential the terms and provisions of this Agreement, as well as any information:

 

(a)          which it has acquired or will acquire from the other Party and/or from the JV Company (whether before or after the date of this Agreement) in relation to the customers, business or assets of the other Party and/or the JV Company;

(b)          which it has acquired or will acquire in relation to the customers, business or assets of the other Party and/or the JV Company as a result of the negotiations of this Agreement and/or in their capacity as a shareholder or member of the Board of Directors of the JV Company;

(collectively the “ Confidential Information ”).

Neither Party shall use for its own business purposes or disclose to any Third Party such Confidential Information without the consent of the other Party.

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19.2.2     Exceptions .  The above confidentiality obligation shall not apply to:

 

(a)          information which is independently developed by a Party or validly acquired from a Third Party;

(b)          information which is known by the receiving Party prior to the disclosure by the disclosing Party;

(c)          the disclosure of Confidential Information to the extent required by Requirements of Law or any stock exchange regulation;

(d)          the disclosure of information to any tax authority to the extent reasonably required for the purposes of the tax affairs of the Party concerned;

(e)          the disclosure, to a Party’s professional advisers, of information reasonably required to be disclosed for a purpose reasonably incidental to this Agreement; and

(f)           information which falls within the public domain (otherwise than as a result of a breach hereunder).

19.2.3     Survival after termination . The provisions of this Section 19.2 shall survive the termination of the Agreement for a period of ten (10) years.

 

19.3.       Notices .  All notices or other communications required or permitted hereunder shall be in writing and shall be deemed given or delivered (a) when delivered personally, (b) if transmitted by facsimile or e-mail when confirmation of transmission is received by the sending Party, such facsimile or e-mail to be confirmed by registered mail or reputable overnight courier, (c) if sent by registered or certified mail, postage prepaid, return receipt requested, on the fifth (5 ^th ) day after mailing or (d) if sent by reputable overnight courier, on the fifth (5 ^th ) day after mailing; and shall be addressed to the Parties as follows:

 

 

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If to Axane, to :
	Mr. Hervé Mennrath Axane 2, rue de Clémencière 38360 Sassenage, France   herve.mennrath@airliquide.com Fax: 00.33.4.76.43.60.28 Attention: Directeur Général   Cc : Direction des Affaires Juridiques 75 quai d’Orsay 75007 Paris, France Fax : 33.1.40.62.51.75 laurent.blamoutier@airliquide.com
If to Plug Power, to :
	Mr. Gerard L. Conway, Jr. General Counsel Plug Power Inc. 968 Albany Shaker Road Latham, New York 12110
	gerard_conway@plugpower.com   Fax: 1.518.782.78.84

or to such other address as such Party may indicate by a notice delivered to the other Parties five (5) days in advance. 

19.4.        Language

 

The official and original version of this Agreement and the Ancillary Agreements shall be in the English language and shall prevail over any non-English version thereof.  The Parties agree that the language used between them and with the JV Company will be the English language, including for all notifications, reporting and corporate secretarial documents, provided that French translations will be established at the JV Company's costs for the purpose of filing and notification to French administrations.  The English version of any such documents, including the Articles of Association, shall prevail between the Parties over any non-English version thereof.

 

19.5.      Assignment; Successors and Assigns; No Third Party Beneficiaries

 

(a)          The rights, interests or obligations of any of the Parties under this Agreement, shall not be assignable or transferable, in whole or in part, prior to or after the Closing Date without the express prior written consent of the other Party, unless assigned or transferred to or substituted by a Party to one or several of its Affiliates in accordance with Section 11.2.1 after the Closing Date.

(b)          This Agreement shall be binding upon and inure to the benefit of the Parties and their respective and permitted successors and assigns.  Nothing in this Agreement, expressed or implied, is intended or shall be construed to confer upon any Person other than the Parties and successors and assigns permitted by this Section 19.5 any right, remedy or claim under or by reason of this Agreement.

(c)          Each of the Parties recognizes and acknowledges that in connection with this Agreement and the Ancillary Agreements and every aspect thereof, including the JV Company and the joint venture contemplated by this Agreement, each Party is expressly relying on the particular skills and performance by to be made available to the JV Company and to such Party by the other Party, that such reliance is unique and irreplaceable, that each Party would be therefore suffer irreparable harm if the rights, interests or obligations of the other Party, or the JV Company Shares, were assigned or transferred, and that accordingly in this respect this Agreement and the Ancillary Agreements are in the nature of personal services contract and neither they, nor the JV Company Shares, nor any rights or obligations of the Parties, are assignable except as expressly provided in this Agreement.  The Parties further recognize and acknowledge that compensatory remedies under law may not be adequate with respect to a breach of the foregoing prohibition on the transfer of such rights, interests or obligations.  Accordingly, it is the intention of the Parties that such prohibition and the lock-up, preemptive, option, put, change of control, governance, Reserved Matters, information and other rights afforded under this Agreement and the Ancillary Agreements be specifically enforced in every respect. 

19.6.       Amendments .  This Agreement shall not be amended, modified or supplemented except by a written instrument signed by an authorized representative of each of the Parties.

 

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19.7.       Extension; Waivers .  Except as otherwise provided herein, the failure or delay of any Party to assert or enforce at any time any provision of, or any of its rights under, this Agreement shall not be construed to be a waiver of such provision, nor in any way to affect the validity of this Agreement or any part hereof or the right of any Party thereafter to enforce each and every such provision.  No waiver of any breach of this Agreement shall be held to constitute a waiver of any other or subsequent breach.

 

19.8.      Expenses .  Except as otherwise provided herein, each Party shall pay its costs and expenses incident to the negotiation and preparation of this Agreement and the Ancillary Agreements, including the fees, expenses and disbursements of its counsel, independent public accountants and investment bankers.

 

19.9.       Severability .   Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but in case any one or more of the provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such provision shall be ineffective to the extent, but only to the extent, of such invalidity, illegality or unenforceability without invalidating the remainder of such invalid, illegal or unenforceable provision or provisions or any other provisions hereof, unless such a construction would be unreasonable.

 

19.10.    Execution in Counterparts .  This Agreement shall be executed in three (3) counterparts.

 

19.11.    Governing Law .  This Agreement, as well as save as otherwise provided, all other agreements to be entered into between the Parties and the JV Company in relation to the JV Company, shall be governed by and construed in accordance with the laws of France.

 

19.12.     Jurisdiction

 

(a)           The Parties shall attempt in good faith to resolve any dispute arising out of or relating to this Agreement promptly by negotiation between executives who have authority to settle the controversy. Each Party may give to the other written notice of any dispute not resolved in the normal course of business.  Within thirty (30) days after delivery of such notice, the receiving Party shall submit to the other a written response.  The notice and the response shall include a statement of each Party’s position, a summary of arguments supporting that position and the name and title of the executive who will represent that Party and of any other Person who will accompany the executive.  Within thirty (30) days after delivery of the disputing Party’s notice, the executives of both Parties shall meet at a mutually acceptable time and place, and thereafter as often as they reasonably deem necessary, to attempt to resolve the dispute.  All negotiations pursuant to this Section 19.12 are confidential and shall be treated as aimed exclusively at finding a compromise and an amicable solution, but without this being regarded as an admission of liability of whatsoever nature. If the dispute cannot be settled through negotiation within thirty (30) days of the initial meeting of the executives provided for above, then Section 19.12(b) applies.

(b)          Any dispute arising out of or relating to this Agreement or resulting therefrom that has not been resolved pursuant to Section 19.12 (a) shall be finally settled by binding and final arbitration in accordance with the Rules of the Arbitration of the International Chamber of Commerce (ICC) by three (3) arbitrators, one arbitrator being appointed by Plug Power, another by Axane and the third being appointed by the ICC.  The place of arbitration shall be Geneva (Switzerland) and the arbitral procedure shall be conducted in the English language.

(c)          Nothing contained in this Section  19.12 shall prevent the Parties from settling any dispute by mutual agreement at any time.

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19.13.     Entire Agreement .  This Agreement and the documents delivered pursuant hereto contain the entire understanding of the Parties with regard to the subject matter contained in this Agreement or the documents so delivered, and supersede all prior agreements, negotiations, discussions, representations, warranties, understandings or letters of intent between or among any of the Parties.

 

 

 

In Paris,
On January 29, 2012,
/s/ Mr. Hervé Mennrath	/s/ Mr. Andy Marsh
Mr. Hervé Mennrath	Mr. Andy Marsh
Axane	Plug Power Inc.
In the presence of:
/s/ Mr. Eric Prades
Mr. Eric Prades
Air Liquide Production

 

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LICENSE AGREEMENT

 

 

            This LICENSE AGREEMENT dated as of February 29, 2012, is entered into by and between Plug Power Inc. a Delaware corporation (“ Licensor ”) having its principal office at 968 Albany Shaker Road, Latham, New York 12110 and Hypulsion a French Société par Actions Simplifiée (“ Licensee ”) having its registered office at 6 rue Cognacq Jay, 75007 Paris, France;

 

WHEREAS, pursuant to a Master and Shareholders’ Agreement, dated January 24, 2012 (the “ Master Agreement ”), Licensor and Axane S.A. (“Axane”), agreed to form a joint venture company to develop certain hydrogen fuel cell systems for the European material handling market;

WHEREAS, pursuant to the Master Agreement, Licensor agreed to contribute a license to certain items of intellectual property in exchange for its ownership interest in the joint venture;

WHEREAS, pursuant to the Master Agreement, Axane has agreed to contribute a total amount of €5.5 million (payable in several installments) in funding in exchange for its ownership interest in the joint venture;

WHEREAS, subject to the terms and conditions of this License Agreement, Licensee desires and is willing to secure from Licensor, and Licensor desires and is willing to grant to Licensee a license exclusive in the Territory in and to certain Licensed IP (as defined below) that is owned by Licensor;

WHEREAS, the Parties hereby acknowledge the personal nature of this Agreement (“ intuitu personae ”), and that Licensor would not have entered into this Agreement under any circumstances but for the involvement of the Air Liquide group in the creation of an independent joint venture with Licensor; and

WHEREAS, the Master Agreement requires that this License Agreement be executed and delivered by the Parties and be incorporated into the Contribution and License Agreement (as such term is defined in the Master Agreement).

NOW, THEREFORE, in consideration of these premises and the mutual covenants, agreements, representations and warranties herein contained, the Parties hereby agree as follows:

1.         Certain Defined Terms .   The following terms shall have the meanings set forth below and shall be controlling over any definition thereof contained in the Master Agreement:

1.1        “Affiliate” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with such Person.  For purposes of this definition the term “control” shall mean ownership of at least fifty percent (50%) of the equity ownership or voting control of a Person. For purposes of this License Agreement, Axane and its Affiliates shall not be deemed to be “Affiliates” of Licensor; and Licensor and its Affiliates on one hand and Axane and its Affiliates (including for the avoidance of doubt Air Liquide) on the other hand shall not be deemed to be “Affiliates” of Licensee.

 

 

 

 

 

 

 

 

1.2           “Business” means owning, developing, selling, trouble shooting, using, repairing and maintaining integrated hydrogen fuel cell systems for the European material handling market defined as material handling products in Classes 1‑5. ¹

1.3           “Confidential Information” means, subject to the exceptions set forth below, any information or data, regardless of whether it is in tangible form, disclosed or otherwise made available under, or in connection with, this License Agreement by the Disclosing Party to Receiving Party, including manufacturing, financial, marketing or technical information such as specifications, manufacturing methods, price guidelines, future product releases, trade secrets, know-how, inventions, techniques, processes, programs, concepts, ideas, techniques, schematics, customer lists and sales and marketing plans, that the Disclosing Party has either marked as confidential or proprietary, or has identified in writing as confidential or proprietary within thirty (30) days of disclosure, provided , however , that, for the avoidance of doubt, reports and/or information related to or regarding a Disclosing Party’s business plans, strategies, technology and research and development shall be deemed Confidential Information of the Disclosing Party even if not so marked or identified.  The Licensed Know-How and Source Code included in the Licensed Software shall be deemed Confidential Information of Licensor.  The terms of this License Agreement shall be considered to be Confidential Information of both Parties.  Notwithstanding the above, the non-disclosure obligations under this License Agreement applicable to Confidential Information would not apply to such information which: (a) was known to the Receiving Party prior to receipt from the Disclosing Party directly or indirectly from a source other than one having an obligation of confidentiality to the Disclosing Party, as demonstrated by competent evidence; (b) becomes known (independently of disclosure by the Disclosing Party) to the Receiving Party directly or indirectly from a source other than one having an obligation of confidentiality to the Disclosing Party; (c) becomes publicly known or otherwise ceases to be secret or confidential, except through a breach of this License Agreement, wrongful act, fault or negligence by the Receiving Party or its employees; or (d) was independently developed by the Receiving Party, as demonstrated by competent evidence.

1.4           “Controlled” means, with respect to a Party and its relationship to Know-How, Patents, Copyrights or Software, that such Know-How, Patents, Copyrights or Software is either (a) owned by said Party or (b) held by said Party under license from a third party, where the Party has the ability to grant a sublicense to the other Party consistent with the license grants set forth in Article 3 hereof, without the need to obtain the consent of such third party or to pay to such third party any additional royalty or other consideration in respect of such sublicense to the other Party.

1.5           “Copyrights” means copyrights and related rights in original published and unpublished works of authorship fixed in a tangible medium of expression and related registrations and applications for registration in the United States Copyright Office or in any similar office or agency anywhere in the world.

1.6           “Disclosing Party” means the Party disclosing Confidential Information under this License Agreement.

1.7           “Effective Date” shall mean the Closing Date, as that term is defined in the Master Agreement.

 

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¹ Class 1: Electric Motor Sit-down Counterbalanced Truck; Class 2: Electric Motor Narrow Aisle Trucks; Class 3: Electric Motor Hand or Hand-Rider Trucks; Class 4: Internal Combustion Engine Trucks (Solid/Cushion Tires); Class 5: Internal Combustion Engine Trucks (Pneumatic Tires).

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1.8           “Field” means the field of integrated hydrogen fuel cell systems for the material handling market defined as material handling products in Classes 1‑5. ²

1.9           “Know-How” means all confidential, technical and/or proprietary information and knowledge, whether or not patentable and whether or not in written form, including, without limitation, information, inventions, procedures, assembly and operating instructions, specifications, tolerances, manufacturing processes, compositions, know-how, knowledge, discoveries, techniques, research in progress, trade secrets, systems, methods, processes, algorithms, technical data, formulae, drawings, designs, schematics, blueprints, flow charts, models, prototypes, techniques, practices, manufacturing and design information, information regarding biological reagents, and financial, business, marketing, supplier, customer, and client information.

1.10        “Laws” means all laws, statutes, rules, regulations, ordinances and other pronouncements having the effect of law of any federal, national, multinational, state, provincial, county, city or other political subdivision, domestic or foreign.

1.11        “License Agreement” means this License Agreement, including without limitation all exhibits, schedules, and attachments hereto, and amendments to the foregoing.

1.12        “Licensed Copyrights” means any and all Copyrights which (a) would be infringed by, are otherwise necessary to the development and conduct of the Business in the Field and the Territory, or are otherwise commercialized by Licensor in products in the Field outside the Territory and (b) are Controlled by Licensor as of the Effective Date or which subsequently become Controlled by Licensor after the Effective Date.  Licensed Copyrights include, but are not limited to, the works of authorship listed in Schedule A hereto.

1.13        “Licensed Back Copyrights” means any and all Copyrights which (a) would be infringed by or are otherwise necessary to Licensor’s business, products, or services in the Field, or are otherwise commercialized by Licensee in products in the Field and (b) become Controlled by Licensee after the Effective Date.

1.14        “Licensed Documentation” means any and all end user documentation and technical documentation which is: (a) becomes Controlled by Licensor after the Effective Date, and (b) necessary to the development and conduct of the Business in the Field and the Territory or otherwise commercialized by Licensor in products in the Field outside the Territory.

1.15        “Licensed Back Documentation” means any and all end user documentation and technical documentation which is: (a) Controlled by Licensee as of the Effective Date or which subsequently becomes Controlled by Licensee after the Effective Date, and (b) would be infringed by or are otherwise necessary to Licensor’s business, products, or services in the Field, or are otherwise commercialized by Licensee in products in the Field.

1.16        “Licensed Back IP” means, collectively, any and all of the Licensed Back Copyrights, Licensed Back Software, Licensed Back Documentation, Licensed Back Know-How and Licensed Back Patents.

 

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² Class 1: Electric Motor Sit-down Counterbalanced Truck; Class 2: Electric Motor Narrow Aisle Trucks; Class 3: Electric Motor Hand or Hand-Rider Trucks; Class 4: Internal Combustion Engine Trucks (Solid/Cushion Tires); Class 5: Internal Combustion Engine Trucks (Pneumatic Tires).

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1.17        “Licensed IP” means, collectively, any and all of the Licensed Copyrights, Licensed Software, Licensed Documentation, Licensed Know-How and Licensed Patents.

1.18        “Licensed Know-How” means any and all Know-How, including rights under applicable trade secret laws, which (a) would be infringed by, are otherwise necessary to the development and conduct of the Business in the Field and the Territory, or are otherwise commercialized by Licensor in products in the Field outside the Territory and (b) are Controlled by Licensor as of the Effective Date or become Controlled by Licensor after the Effective Date, including the manufacture, assembly, structure, design, operation, use, sale, repair, and maintenance thereof.  Licensed Know-How includes, but is not limited to, the Know-How listed in Schedule B hereto.

1.19         “Licensed Back Know-How” means any and all Know-How, including rights under applicable trade secret laws, which (a) would be infringed by or are otherwise necessary to Licensor’s business, products, or services in the Field, or are otherwise commercialized by Licensee in products in the Field and (b) become Controlled by Licensee after the Effective Date.

1.20         “Licensed Patents” means any and all Patents which (a) are Controlled by Licensor as of the Effective Date or subsequently become Controlled by Licensor after the Effective Date, and (b) would be infringed by, are otherwise necessary to the development and conduct of the Business in the Field and the Territory, or are otherwise commercialized by Licensor in products in the Field outside the Territory.  Licensed Patents are the “Patents” listed in Schedule C hereto, as that term is defined in Section 1.30.  The parties agree that any Patents that meet the criteria set forth in this section shall be deemed to be included in the list of Patents on Schedule C, and the parties shall execute amendments to this License Agreement to include such Patents on Schedule C.

1.21        “Licensed Back Patents” means any and all Patents (a) would be infringed by or are otherwise necessary to Licensor’s business, products, or services in the Field, or are otherwise commercialized by Licensee in products in the Field and (b) become Controlled by Licensee after the Effective Date.

1.22        “Licensed Product” means any and all products or services relating to the products that are within the Field and the Territory that, but for the licenses granted in Article 3 of this Agreement, would infringe the Licensed IP.

1.23        “Licensed Software” means, any and all software (including Source Code and Object Code) that (a) is Controlled by Licensor as of the Effective Date or subsequently becomes Controlled by Licensor after the Effective Date, and (b) would be infringed by, are otherwise necessary to the development and conduct of the Business in the Field and the Territory, or are otherwise commercialized by Licensor in products in the Field outside the Territory.  Licensed Software includes, but is not limited to, the Software listed in Schedule D hereto.

1.24         “Licensed Software Documentation” means any and all end user documentation and technical documentation (e.g., source code documentation and other technical documentation) which (a) is Controlled by Licensor as of the Effective Date or subsequently becomes Controlled by Licensor after the Effective Date, and (b) was or has been used or held for use with the Licensed Software.  Licensed Software Documentation includes, but is not limited to, the Software Documentation listed in Schedule E hereto.

1.25        “Licensor” shall have the meaning set forth in the Introductory Paragraph.

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1.26        “Object Code” means computer software programs, assembled or compiled substantially or entirely in binary form, which are readable and usable by computer equipment, but not generally readable by humans without reverse assembly, reverse compiling, or reverse engineering.

1.27        “Open Source Software” means any software that is licensed under a license agreement recognized as an “open source license” by the Open Source Initiative.

1.28        “Party” means Licensee or Licensor, individually, and “Parties” means Licensee and Licensor, collectively.

1.29        “Patents” means (a) patents and patent applications (which for the purposes of this License Agreement shall be deemed to include certificates of invention and applications for certificates of invention, provisional patent applications, letters patents, utility patents, and design patents), (b) all divisionals, continuations, request for continued examination applications, continuation-in-part applications, and other related or continuing patent applications of any patents or applications described in the foregoing clause (a) or this clause (b), (c) all patents issuing on any of the foregoing, (d) all registrations, grants, reissues, reexaminations, renewals, and supplemental protection certificates, including any term adjustments, restorations or extensions of any of the foregoing, (e) all other patents and patent applications of any type issued or filed anywhere in the world claiming priority in whole or in part to or from any of the foregoing, and (f) all international patents, utility models, invention registrations of any kind, and any other patent applications of any kind corresponding to any of the foregoing.

1.30         “Person” means any individual, partnership, limited liability company, corporation, cooperative, association, joint stock company, trust, joint venture, unincorporated organization or governmental authority, body or entity or any department, agency or political subdivision thereof.

1.31        “Receiving Party” means the Party receiving Confidential Information under this License Agreement.

1.32         “Source Code” means the human readable representation of a computer program or designs written in any computer-programming language (e.g., VHDL, Verilog, Matlab, SPICE, C, C++, TCL, Perl, assembly code, etc.).

1.33         “Territory” shall mean the territories of Albania, Austria, Belgium, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Czec h Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Liechtenstein, Luxemburg, Republic of Macedonia, Malta, Montenegro, the Netherlands, Norway, Poland, Portugal, Romania, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland, and United Kingdom.

1.34         “Third Party” means any Person other than Licensee, Licensor or an Affiliate of Licensee or Licensor.

2.             Rules of Interpretation and Construction.

2.1           In this License Agreement, except to the extent expressly provided otherwise:

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(a)           The definitions of the terms herein shall apply equally to the singular and plural forms of the terms defined.  Neutral pronouns and any variations thereof shall be deemed to include the feminine and masculine and all terms used in the singular shall be deemed to include the plural, and vice versa, as the context may require  The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.  The word “any” shall mean “any and all” unless otherwise clearly indicated by context.  Where either Party’s consent is required hereunder, except as otherwise specified herein, such Party’s consent may be granted or withheld in such Party’s sole discretion.  Derivative forms of any capitalized term defined herein shall have meanings correlative to the meaning specified herein. 

(b)           Unless the context requires otherwise: (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or therein), (ii) any reference to any laws herein shall be construed as referring to such laws as from time to time enacted, repealed or amended, (iii) any reference herein to any person shall be construed to include the person’s successors and assigns permitted hereunder, (iv) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this License Agreement in its entirety and not to any particular provision hereof, and (v) all references herein to Articles, Sections, or Schedules, unless otherwise specifically provided, shall be construed to refer to Articles, Sections or Schedules of this License Agreement.

(c)            Each Party hereto agrees that any rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not be applied in the construction or interpretation of this License Agreement.

(d)            In the event of any conflict between this License Agreement and the Contribution and License Agreement, the terms of this License Agreement shall control.

3.          License Grants.

3.1         Patents and Know-How.  Subject to the terms and conditions of this License Agreement, Licensor hereby grants to Licensee and Licensee hereby accepts an exclusive (within the Territory, subject to the terms of Section 3.4), non-terminable (except as expressly permitted under Section 10), royalty-free, fully paid-up, personal, non-transferable (except as expressly permitted by Section 15.6) and non-sublicensable (except as expressly permitted by Section 3.7) right and license under the Licensed Patents and Licensed Know-How, only in the Field and only in the Territory, to make, have made on Licensee’s behalf, use, sell, have sold on Licensee’s behalf, offer for sale, have offered for sale on Licensee’s behalf, import and have imported on Licensee’s behalf Licensed Products, and the right to practice or have practiced on Licensee’s behalf the methods claimed in such Licensed Patents or Licensed Know-How in connection with such Licensed Products, including the future development and commercialization thereof.

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3.2           Copyrights.  Subject to the terms and conditions of this License Agreement, Licensor hereby grants to Licensee and Licensee hereby accepts an exclusive (within the Territory, subject to the terms of Section 3.4), non-terminable (except as expressly permitted under Section 10), royalty-free, fully paid-up, personal, non-transferable (except as expressly permitted by Section 15.6) and non-sublicensable (except as expressly permitted by Section 3.7) right and license under the Licensed Copyrights (excluding any Licensed Software), only in the Field and only in the Territory, to reproduce, display, distribute, modify and create derivative works and/or perform, or to have such acts performed for the benefit of Licensee, the works of authorship that are the subject matter of the Licensed Copyrights (excluding the Licensed Software) in each case in connection with a Licensed Product, including the future development and commercialization thereof. 

3.3          Licensed Software.

(a)           Source License Grant.  Subject to the terms and conditions of this License Agreement, Licensor hereby grants to Licensee and Licensee hereby accepts a non-transferable (except as permitted under Section 15.6), exclusive (within the Territory, subject to the terms of Section 3.4), non-terminable (except as expressly permitted under Section 10), royalty-free, fully paid-up, personal, and non-sublicensable (except as expressly permitted by Section 3.7) license, only in the Field and only in the Territory, to internally use, copy, modify, create derivative works of, and support the Source Code of the Licensed Software in connection with a Licensed Product, including the future development and commercialization thereof. 

(b)           Object License Grant.  Subject to the terms and conditions of this License Agreement, Licensor hereby grants to Licensee and Licensee hereby accepts a non-transferable (except as permitted under Section 15.6), exclusive (within the Territory, subject to the terms of Section 3.4), non-terminable (except as expressly permitted under Section 10), royalty-free, fully paid-up, personal, and non-sublicensable (except as expressly permitted by Section 3.7) license, only in the Field and only in the Territory, to: (a) use, reproduce, modify (including the right to create derivative works of), publicly perform, publicly display, and support the Object Code of the Licensed Software in connection with a Licensed Product, including the commercialization thereof and (b) to market, distribute and sublicense the right to use the Object Code of the Licensed Software in connection with a Licensed Product, including the future development and commercialization thereof. 

(c)           Documentation License Grant.  Subject to the terms and conditions of this License Agreement, Licensor hereby grants to Licensee an exclusive (within the Territory, subject to the terms of Section 3.4), non-terminable (except as expressly permitted under Section 10), royalty-free, fully paid-up, personal, non-transferable (except as expressly permitted by Section 15.6) and non-sublicensable (except as expressly permitted by Section 3.7) right and license to use, reproduce, display, distribute and modify and create derivative works of all or any portion or portions of the Licensed Documentation for purposes of creating new versions of the Licensed Documentation and to distribute such Documentation for use in connection with the use of the applicable Licensed Software and corresponding Licensed Products. 

(d)           Restrictions .  Except as otherwise permitted in this License Agreement, Licensee shall not modify, distribute, or otherwise use the Licensed Software in any manner that would require the disclosure or distribution of source code versions of the Licensed Software (“Source Code Disclosure”), other than any Open Source Software included in the Licensed Software.

3.4          Exclusivity.  Pursuant to the exclusive licenses granted under Sections 3.1 through 3.3 above (the “Licenses”) and the license back granted under Section 3.10, Licensor and its Affiliates are generally prohibited from making, having made, using, selling, having sold or importing Licensed Products in the Field and in the Territory under any of the Licensed IP or the Licensed Back IP, except as permitted by the process set forth in Section 10.3 of this License Agreement or the process set forth in Section 10.1(b) of the Master Agreement.  In the event that Licensor sells the entirety of its JV Company Shares, as that term is defined in the Master Agreement, then the Licenses shall become non-exclusive one year after the date of Licensor’s sale of its JV Company Shares.

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3.5          Manufacturers, Distributors . The “have made” and “have sold” rights granted to Licensee under the Licenses include the grant of rights for any Third Party manufacturer or distributor in connection with contract manufacturing and/or distribution agreements that, in each case, contemplates manufacturing and/or distribution, as applicable, of Licensed Products (as a full system or a module thereof) for, or on behalf of, (A) Licensee or an Affiliate of Licensee using Licensor’s or Licensee’s branding (so long as Licensee or its Affiliate controls, directly or indirectly (including by contract), the design or distribution of such Licensed Product, and the agreement with the Third Party manufacturer or distributor includes the restrictions that apply to Licensee’s manufacturing and distribution under this License Agreement) or (B) such Third Party manufacturer or distributor for the Licensed Products it manufactures or distributes (so long as Licensee or its Affiliate controls, directly or indirectly (including by contract), the design or distribution of such Licensed Product, and the agreement with the Third Party manufacturer or distributor includes the restrictions that apply to Licensee’s manufacturing and distribution under this License Agreement).

3.6          Customers. Licensor covenants not to assert any Licensed IP against any purchaser of a module containing any Licensed Product (including any Third Party that purchases from Licensee or an Affiliate of Licensee) in connection with such purchaser’s incorporation of such module into another product and the related manufacturing, distribution, sale and use of such product (so long as Licensee or its Affiliate controls, directly or indirectly (including by contract), the design or distribution of such Licensed Product, and the agreement with the purchaser includes, subject to applicable law, the restrictions that apply to Licensee’s manufacturing, distribution, sale and use under this License Agreement).  Notwithstanding the foregoing, Licensee need not use more than reasonable commercial efforts to include the restrictions that apply to Licensee’s manufacturing, distribution, sale and use under this License Agreement in the agreement with the purchaser, and Licensor makes no covenant with respect to any purchaser lacking such terms from their agreement with Licensee.

3.7          Sublicenses. Restrictions.

(a)          Licensee Affiliates. Subject to the terms and conditions set forth in this License Agreement , Licensee may, with Licensor’s advance written consent, grant sublicenses of any or all of the Licenses to any Affiliate of Licensee.  To the extent Licensee grants a sublicense of any or all of the Licenses to any Affiliate of Licensee, such Affiliate shall have the right to exercise said licenses in the same manner as Licensee is allowed to under this License Agreement. 

(b)          Source Code.  Subject to the terms and conditions hereof, Licensee may, with Licensor’s advance written consent, sublicense the rights granted to Licensee under Section 3.3(a) to (i) end users of the Licensed Software solely for purposes of maintaining the Licensed Software in the event that Licensee is unable to do so, (ii) software escrow agents holding the applicable Source Code for the benefit of the end users described in the foregoing clause (i), and (iii) contractors of Licensee or its Affiliates solely as necessary for such contractors to perform services on behalf of Licensee or its Affiliates.

(c)          General.  All sublicenses granted by Licensee shall be no less protective in all material respects of the Licensed IP than the terms and conditions of this License Agreement or shall be null and void.  Within 30 days of the end of each calendar quarter, Licensee shall provide Licensor with a written report listing each new sublicensee to which it has sublicensed rights the Licenses.

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(d)          No Sublicenses Granted to Licensor Competitors.  Notwithstanding anything herein, Licensee will not grant any sublicense or rights to any of the rights or licenses granted herein to any of the following entities or any successor or assign of any of the following entities:  Ballard, UTC Power, Nuvera Fuel Cells, Hydrogenics, Relion, Altergy, Nedstack, Proton Motor, H2 Logic, Intelligent Energy, Oorja, Protonix, Ultra-cell, HyGear, Fuel Cell Energy, or DanTherm .  Licensor may add a competitor to Licensor to the immediately foregoing sentence by issuing notice of such amendment to Licensee in accord with Section 15.2.  The restriction set forth in this Section 3.7(d) shall not apply in the event that any such entity becomes an Affiliate of Licensee. 

3.8         Reservations; Restrictions.

(a)           Except as expressly set forth herein, Licensor reserves all right, title and interest in the Licensed IP.  Licensee shall not exercise any of the Licensed IP outside of the Field or outside of the Territory nor knowingly sell, transfer or otherwise provide, directly or indirectly, the Licensed Products for use or sale outside of the Field or outside of the Territory. 

(b)          Licensee explicitly acknowledges the personal nature of the licenses granted herein, and that Licensor would not have entered into this Agreement with any other party.

3.9          License Back. Subject to any restrictions imposed by the H2E Collaboration Program and the Master Agreement, Licensee hereby grants and agrees to grant to Licensor and its Affiliates a non-exclusive, worldwide (except in the Territory, subject to Section 3.4), non-terminable, royalty-free, fully paid-up, irrevocable, non-transferable (except as expressly permitted by Section 15.6) and sublicensable (through multiple tiers) right and license under the Licensed Back IP, only in the Field, to make, have made on Licensor’s behalf, use, sell, have sold on Licensor’s behalf, offer for sale, have offered for sale on Licensor’s behalf, import, have imported on Licensor’s behalf, reproduce, display, distribute, modify, create derivative works, perform, or to have such acts performed for the benefit of Licensor, products and services that would otherwise infringe the Licensed Back IP and to otherwise operate the Licensor’s and Affiliates’ business in the Field. For the avoidance of doubt, Licensor and its Affiliates shall be prohibited from exercising this license right within the Territory during the term of the License Agreement except as permitted in Section 3.4.  The Parties agree to negotiate in good faith for any license outside the Field

3.10       License to Axane. Subject to any restrictions imposed by the H2E Collaboration Program and the Master Agreement, Licensee hereby grants and agrees to grant to Axane and its Affiliates a non-exclusive, non-terminable, royalty-free, fully paid-up, irrevocable, non-transferable and sublicensable (through multiple tiers) right and license under the Licensed Back IP, only in the Field and only in the Territory, to make, have made on Axane’s behalf, use, sell, have sold on Axane’s behalf, offer for sale, have offered for sale on Axane’s behalf, import, have imported on Axane’s behalf, reproduce, display, distribute, modify, create derivative works, perform, or to have such acts performed for the benefit of Axane, products and services that would otherwise infringe the Licensed Back IP, said right and license not to be effective unless and until Licensee ceases to exist as an entity, unless the Licensee is liquidated further to Article 10.5 of the Master Agreement in which case said right and license shall not be effective before the expiration of the three (3) year period as provided for in Article 10.5(g) of the Master Agreement. 

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4.          Transfer of Copies of Licensed IP .   Within one hundred twenty (120) days after the Effective Date, Licensor shall transfer or make reasonably available to Licensee copies of all documents and materials owned by Licensor that document, describe or embody the Licensed IP or the subject matter of the Licensed IP sufficient to permit Licensee to exercise its rights hereunder with respect to use of the Licensed IP.  The Parties will agree to a schedule of in-person meetings or teleconferences as may be reasonably necessary to effect the transfer of the Licensed IP within one hundred twenty (120) days of the Effective Date.  From time to time during the Term, promptly after the development or acquisition by Licensor of new Licensed IP that was not previously disclosed to Licensee, Licensor shall transfer or make reasonably available to Licensee copies of documents and materials owned by Licensor that document, describe or embody such new Licensed IP or the subject matter of such new Licensed IP sufficient to permit Licensee to exercise its rights hereunder with respect to use of such new Licensed IP.  From time to time during the Term, promptly after the development or acquisition by Licensee of new Licensed Back IP that was not previously disclosed to Licensor, Licensee shall transfer or make reasonably available to Licensor copies of documents and materials owned by Licensee that document, describe or embody such new Licensed Back IP or the subject matter of such new Licensed Back IP sufficient to permit Licensor to exercise its rights hereunder with respect to use of such new Licensed Back IP.

5.          Patent Marking . Licensor shall supply Licensee with a form of patent notice complying with applicable law with which Licensee shall mark the Licensed Products, and Licensor shall bear responsibility for any deficiencies in the supplied notice.  Licensee shall require Third Party manufacturers to mark all Licensed Products with the form of patent notice. In the event that a Licensed Product cannot be marked itself, the patent notice shall be placed on associated tags, labels, packaging, or accompanying documentation, either electronic or paper, as appropriate to the extent required by applicable law.

6.           Filing, Prosecution, and Maintenance of Licensed IP .

6.1          Licensor’s Rights.  Licensor, by counsel it so chooses, has the first right, but not the obligation, to file, prosecute and maintain with any Patent Office or any Copyright Office, at its sole expense, the Licensed IP, in its own name and in countries designated by it at its sole discretion.  Licensor shall cause its patent counsel to provide Licensee with a list of the countries in which it has filed and/or intends to file applications.  Such list shall be provided to Licensee at least sixty (60) days prior to the expiration of the corresponding United States (or, if applicable, Patent Cooperation Treaty) priority date to allow Licensee to suggest that additional countries be added to the list or that one or more countries be deleted from the list.  Licensor agrees to file applications, at its sole cost and expense, in the additional countries requested by Licensee unless it otherwise notifies Licensee under this Section 6.1 no less than thirty (30) days prior to the expiration of the corresponding priority date or within fifteen (15) days of Licensor’s receipt of any such suggested additions from Licensee, whichever is closer to the expiration of the corresponding priority date.

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6.2            Licensee’s Rights.  If Licensor has decided not to exercise its rights in Section 6.1 above, then Licensor shall give written notice to Licensee of its determination not to file an application for and/or cease prosecution and/or maintenance of Licensed IP on a country by country basis. Following such notice, or if Licensor fails to provide any notice and fails to act in a timely manner such that there is a material risk that the deadline to pursue such Licensed IP will not otherwise be met, Licensee shall have the right, in its sole discretion, to file an application for, and/or continue prosecution and/or maintenance of such Licensed IP at its own expense (“Licensee Prosecution Controlled IP”), provided that Licensor has failed to act in a timely manner, Licensee provides Licensor with written notice that Licensee intends to assume responsibility for such Licensed IP and Licensor does not respond or timely act with respect to the Licensed IP.  Licensor shall maintain all of the Licensed IP, at its sole expense, unless it provides Licensee with such written notice of Licensor’s intent not to do so no less than sixty (60) days before any corresponding nominal deadline for incurring an expense or otherwise taking a necessary action to maintain such Licensed IP. If Licensor provides notice that it will not maintain any Licensed IP, or if Licensor fails to provide any notice and fails to act in a timely manner such that there is a material risk that the deadline to maintain such Licensed IP will not otherwise be met, Licensee shall have the right to prosecute and maintain such Licensed IP, provided that Licensor has failed to act in a timely manner, Licensee provides Licensor with written notice that Licensee intends to assume responsibility for such Licensed IP and Licensor does not respond or timely act with respect to the Licensed IP. If Licensee elects to file an application for and/or continue prosecution and/or maintenance of any such Licensee Prosecution Controlled IP, Licensor shall cooperate with Licensee at Licensee’s expense as may be reasonably necessary in a timely manner for Licensee to perform any filing, prosecution or maintenance of any Licensee Prosecution Controlled IP.  Licensor shall promptly assign, or caused to be assigned, to Licensee all of Licensor’s right, title, and interest to any Licensee Prosecution Controlled IP, and Licensor shall deliver to Licensee a suitable written assignment document confirming this assignment of the Licensee Prosecution Controlled IP within thirty (30) days of Licensee electing to file an application, continue prosecution, and/or maintain such portion of the Licensed IP as provided for in this Section 6.2; provided that Licensor’s obligation to so assign its rights in and to the Licensee Prosecution Controlled IP is conditioned upon Licensee granting Licensor a worldwide (except in the Territory, subject to Section 3.4), non-terminable, royalty-free, fully paid up, non-exclusive, irrevocable, non-transferable (except as expressly permitted by Section 15.6), sublicensable (through multiple tiers) right and license to make, have made, use, sell, have sold, offer for sale, have offered for sale, import and have imported products and services which embody any of the Licensee Prosecution Controlled IP, and the right to practice or have practiced the methods claimed in such Licensee Prosecution Controlled IP.  Upon any of the Licensed IP becoming Licensee Prosecution Controlled IP, the Parties’ respective first and second rights to control any proceeding or enforcement action, as set forth in Sections 7 and 8 of this License Agreement, shall be reversed so that the first right belongs to Licensee.

6.3           Cooperation.  In connection with the prosecution and/or maintenance of Licensed IP in accordance with Sections 6.1 or 6.2 set forth above, the Party controlling such prosecution or maintenance shall keep the other Party informed of developments in any such prosecution or maintenance.

6.4           Patent Term Restoration, Extension or Adjustment.  The Parties shall cooperate with each other, including without limitation to provide, at the other Party’s cost, necessary information and assistance as the other Party may reasonably request, in obtaining patent term restoration, extension or adjustment certificates or their equivalents in any country where applicable to the Licensed Patents.  The Party responsible for prosecuting a patent application included in the Licensed Patents shall apply promptly for such patent term restoration, extension, or adjustment or their foreign equivalents.  In the event that elections with respect to obtaining such patent term restoration, extension or adjustment are to be made with respect to Licensed Patents, Licensor shall have the right to make the election and Licensee agrees to abide by such election.

7.            Interference, Opposition, Reexamination, and Reissue .  

7.1           Parties’ Rights.  Each Party shall, within thirty (30) days after learning of such event, inform the other Party of any request for, or filing or declaration of, any interference proceeding, opposition, reexamination or reissue related to any Patent included in the Licensed IP.  The Parties shall consult and cooperate fully to determine a course of action with respect to any such proceeding.

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(a)          Licensor’s Rights.  Licensor shall have the first right, but not the obligation, under its own control and at its own expense, to prosecute and/or defend any such interference proceeding, opposition, reexamination or reissue related to any Patent included in the Licensed IP.  Licensee shall reasonably assist Licensor in this regard at Licensor’s request. 

(b)          Licensee’s Rights.  Should Licensor elect not to prosecute and/or defend any such interference proceeding, opposition, reexamination or reissue related to any Patent included in the Licensed IP, it shall provide Licensee with written notice of this decision no later than fifteen (15) days before any deadline for making an appearance, filing a document, or otherwise taking a necessary step to initiate or continue such interference proceeding, opposition, reexamination or reissue.  For any such interference proceeding, opposition, reexamination or reissue, Licensee shall have the right, but not the obligation, to undertake at its own control and expense the prosecution and/or defense, including doing so in Licensor’s name.  Should Licensee so elect to undertake the prosecution and/or defense, then the Patent shall become part of the Licensee Prosecution Controlled IP provided for in Section 6.  Licensor agrees to provide reasonable assistance to Licensee at Licensee’s request.

7.2         Cooperation.  At the expense of Licensor, the Parties shall cooperate fully with respect to any such action or proceeding, including to the extent permissible by law, providing each other with any information or assistance that either may reasonably request relating to the status of, or developments in, any such action or proceeding or any negotiation related thereto.

8.          Enforcement and Defense .

8.1         Infringement by Third Party.

(a)            Notice of Infringement. Each Party shall provide written notice to the other Party promptly after becoming aware of any infringement of the Licensed IP, or any declaratory judgment action or any other action or proceeding alleging invalidity, unenforceability or non-infringement of the Licensed IP (other than interferences, oppositions, reissue proceedings and re-examinations with respect thereto, which are addressed in Section 7) that may come to their attention.

(b)            Licensor’s Rights.  Licensor shall have the first right, but not the obligation, under its own control and at its own expense, to prosecute any third party infringement of the Licensed IP or to defend the Licensed IP in any declaratory judgment action brought by a Third Party which alleges invalidity, unenforceability, or non-infringement of the Licensed IP.  Licensor may enter into any settlement, consent judgment, or other voluntary final disposition of any infringement or declaratory judgment action hereunder without the prior written consent of Licensee, provided that such settlement, consent judgment, or other voluntary final disposition does not require the payment of any consideration by Licensee or any admission by Licensee, and does not adversely affect Licensee’s rights under the Licenses, in which case Licensee’s prior written consent shall be required, such consent not to be unreasonably withheld or delayed.   Licensee shall, at Licensor’s request and expense, reasonably assist Licensor in any action or proceeding being defended or prosecuted.  Licensee will have the right to participate in any such action or proceeding with its own counsel at its own expense and without reimbursement.

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(c)            Licensee’s Rights.  If Licensor, after notice from Licensee of an alleged infringement or misappropriation of the Licensed IP in the Territory, fails within ninety (90) days to institute proceedings, Licensee, in its own name (or, if required by law, in its and Licensor’s name) and at its own expense, may sue thereof. Licensor shall, but at Licensee’s expense for Licensor’s justified direct associated expenses, fully and promptly cooperate and assist Licensee in connection with any such proceedings, including appearing as a party in any such proceeding to the extent that Licensor is a necessary party or otherwise required to appear. Licensee may enter into any settlement, consent judgment, or other voluntary final disposition of any infringement or declaratory judgment action hereunder without the prior written consent of Licensor, provided that settlement, consent judgment, or other voluntary final disposition does not require the payment of any consideration by Licensor or any admission by Licensor, and does not adversely affect Licensor’s rights in the Licensed IP, in which case Licensor’s prior written consent shall be required, such consent not to be unreasonably withheld or delayed.

9.        Representations and Warranties .

9.1       Licensee.   Licensee hereby represents and warrants to Licensor that as of the Effective Date:

(a)           All corporate action on the part of Licensee and on the part of each of its officers and directors necessary for the authorization, execution and delivery of this License Agreement and the performance of its obligations hereunder has been taken.

(b)           This License Agreement is the legal, valid and binding obligation of Licensee, enforceable against it in accordance with its terms.

(c)           Neither the execution and delivery of this License Agreement nor the performance of the obligations contemplated hereby will: (i) conflict with or result in any violation of or constitute a breach of any of the terms or provisions of, or result in the acceleration of any obligation under, or constitute a default under any provision of any contract or any other obligation to which Licensee is a party or under which Licensee is subject or bound, or (ii) violate any judgment, order, injunction, decree or award of any governmental authority against, or affecting or binding upon, Licensee or upon the assets, property or business of Licensee, or (iii) constitute a violation by Licensee of any applicable Law of any jurisdiction as such Law relates to Licensee or to the property or business of Licensee.

9.2        Disclaimers .  

(a)            LICENSOR SHALL HAVE NO LIABILITY TO LICENSEE FOR ANY INFRINGEMENT OR ALLEGED INFRINGEMENT OF ANY PATENT, PATENT APPLICATION OR OTHER INTELLECTUAL PROPERTY RIGHT OWNED BY ANY THIRD PARTY ARISING OUT OF THE MANUFACTURE, SALE OR USE OF THE LICENSED PRODUCTS OR THE LICENSED SOFTWARE BY LICENSEE.  LICENSEE SHALL HAVE NO LIABILITY TO LICENSOR FOR ANY INFRINGEMENT OR ALLEGED INFRINGEMENT OF ANY PATENT, PATENT APPLICATION OR OTHER INTELLECTUAL PROPERTY RIGHT OWNED BY ANY THIRD PARTY ARISING OUT OF THE MANUFACTURE, SALE OR USE OF ANY PRODUCTS OR SERVICES UNDER THE LICENSED BACK IP BY LICENSOR.  EACH PARTY MAY, IN ITS SOLE DISCRETION, CHOOSE TO ASSIST THE OTHER PARTY IN THE DEFENSE OF ANY CLAIMS BROUGHT BY A THIRD PARTY ALLEGING INFRINGEMENT OF THE LICENSED IP OR THE LICENSED BACK IP, AS THE CASE MAY BE.

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(b)            EXCEPT AS OTHERWISE EXPRESSLY STATED HEREIN OR WITHIN THE MASTER AND SHAREHOLDER AGREEMENT, IT IS FURTHER UNDERSTOOD BY THE PARTIES THAT THE LICENSED IP AND ANY LICENSES GRANTED BY LICENSOR TO LICENSEE ARE PROVIDED UNDER THIS LICENSE AGREEMENT “AS IS” AND MAY CONTAIN DEFICIENCIES AND THAT, EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN SECTION 9.1 OF THIS LICENSE AGREEMENT OR WITHIN THE MASTER AND SHAREHOLDER AGREEMENT, LICENSOR MAKES NO REPRESENTATIONS OR WARRANTIES UNDER THIS LICENSE AGREEMENT TO LICENSEE REGARDING THE USE OR PERFORMANCE OF OR NON INFRINGEMENT BY SUCH LICENSED IP, OR LICENSED RIGHTS.  EXCEPT AS OTHERWISE EXPRESSLY STATED HEREIN, IT IS FURTHER UNDERSTOOD BY THE PARTIES THAT THE LICENSED BACK IP AND THE LICENSE GRANTED BY LICENSEE TO LICENSOR ARE PROVIDED UNDER THIS LICENSE AGREEMENT “AS IS” AND MAY CONTAIN DEFICIENCIES AND THAT, EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN SECTION 9.2 OF THIS LICENSE AGREEMENT, LICENSEE MAKES NO REPRESENTATIONS OR WARRANTIES UNDER THIS LICENSE AGREEMENT TO LICENSOR REGARDING THE USE OR PERFORMANCE OF OR NON-INFRINGEMENT BY SUCH LICENSED BACK IP.  EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES BY EACH PARTY AS SET FORTH IN SECTION 9.1 ABOVE OR WITHIN THE MASTER AND SHAREHOLDER AGREEMENT, EACH PARTY MAKES NO REPRESENTATIONS OR WARRANTIES UNDER THIS LICENSE AGREEMENT AND DISCLAIMS ALL IMPLIED REPRESENTATIONS AND WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY, AND NONINFRINGEMENT.

10.        Term & Termination.

10.1       This License Agreement shall remain in effect in accordance with its terms for an initial period commencing on the Effective Date and ending on June 30, 2013.  The term of this License Agreement shall automatically extend, without any required formalities whatsoever, on the date of payment by Axane of the EUR 2,200,000 cash contribution provided in Section 3.1.2(b) of the Master Agreement, until February 28, 2014.  The term of this License Agreement shall automatically extend, without any required formalities whatsoever, on the date of payment by Axane of the EUR 1,500,000 cash contribution provided in Section 3.1.2(c) of the Master Agreement until the later of (a) the expiration of the last-to-expire Licensed Patent, (b) the expiration of the last-to-expire Licensed Copyrights, (c) the date on which none of the subject matter of the Licensed Know-How is deemed a trade secret under applicable trade secret Law or (d) the date that is 99 years from the Effective Date.  If Axane transfers all or part of its commitment to complete the cash contributions mentioned in this section in accordance with the Master Agreement, then the provisions of this Section 10 referring to Axane shall be deemed to make reference to the transferee of such commitment.

10.2        In case of failure by Axane to make any of the above contributions to Licensee on the above due dates, this License Agreement shall terminate if at the end of the thirty (30) period following a written demand thereof by Licensor to Axane, Axane does not cure such failure.  For the avoidance of doubt, this License Agreement shall not be terminable for any other reason as under this Section 10.2.

10.3        In recognition of the personal characteristics (“intuitu personae”) of this Agreement and the licenses granted hereunder, the Parties hereby acknowledge that the exclusive Licenses will automatically convert into non-exclusive licenses and, at Licensor’s option, that Licensor may terminate this License Agreement in whole or in part by written notice to Licensee in the event of the occurrence of any of the following: (i) if Licensee makes a general assignment for the benefit of creditors, files a voluntary petition in bankruptcy or for reorganization or arrangement under French bankruptcy laws ( sauvegarde, redressement ou liquidation judiciaire ), if a petition in bankruptcy is filed against Licensee and is not dismissed within 30 days after the filing, if a receiver or trustee ( administrateur, mandataire ou liquidateur) is appointed for all or any part of the property or assets of Licensee; or (ii) if the Licensee entity is dissolved in compliance with the terms of the Master Agreement.

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10.4        The expiry or termination of this License Agreement shall result in the immediate termination of the licenses specified in Sections 3.1–3.3.  The provisions of Section 3.10 and Article 11 shall survive any expiration or termination of this License Agreement. Notwithstanding the foregoing, the Parties expressly confirm that the Licensee and/or its Sublicensees retain the right, after the termination or expiration of this Agreement for whatever reason, to exercise the said licenses:

-    for a period of one (1) year from the termination, for the purpose of selling the inventory of Licensed Product existing at the date of termination and/or,

-    for a period of one (1) year from the termination, to the full extent necessary for the manufacture, supply and sales of the Licensed Product, provided that the Licensee and/or its Sublicensees is (are) contractually committed towards (a) Third-party customer(s) to supply the Licensed Product after the termination of this Agreement. 

 

11.       Confidentiality .

11.1      Confidentiality Obligation.  Except as provided for herein, the Receiving Party agrees that at all times during the term of this License Agreement and during a period of ten (10) years following expiration or termination of this License Agreement, it will not (a) use any Confidential Information in any way, for its own account or the account of any Third Party, except for the exercise of its rights and performance of its obligations under this License Agreement, or (b) disclose any Confidential Information to any Person, other than furnishing such Confidential Information to (i) its employees or Third Parties (including Licensee’s customers) who are reasonably required to have access to the Confidential Information in connection with the exercise of its rights and performance of its obligations under this License Agreement and (ii) its legal and internal and independent accounting advisors and representatives (the “Representatives”), provided, that any Person receiving such disclosure from a party hereto shall be advised of the Receiving Party’s obligations hereunder and shall be bound by written confidentiality agreements with respect to such Confidential Information no less onerous than those set forth in this License Agreement or, in the case of Representatives, ethical duties respecting such Confidential Information in accordance with the terms of this Section 11.  The Receiving Party agrees that it will not allow any unauthorized Person (including any Third Party having access to or co-located with the Receiving Party’s facilities) access to the Disclosing Party’s Confidential Information, and that the Receiving Party will take all action reasonably necessary to protect the confidentiality of such Confidential Information, including implementing and enforcing procedures to minimize the possibility of unauthorized use or copying of such Confidential Information.  Each Party will protect such Confidential Information from unauthorized use, access or disclosure with the same degree of care, but no less than a reasonable degree of care, as it uses to protect its own Confidential Information.

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11.2         Disclosures Required by Law.  In the event that the Receiving Party is required by law to make any disclosure of any of Disclosing Party’s Confidential Information, by subpoena, judicial or administrative order or otherwise, the Receiving Party shall first give written notice of such requirement to the Disclosing Party, and shall permit the Disclosing Party to intervene in any relevant proceedings to protect its interests in the Confidential Information, and provide full cooperation and assistance to the Disclosing Party in seeking to obtain such protection.  The Receiving Party may disclose Confidential Information to the extent that such disclosure is: (a) made in response to a valid order of a court of competent jurisdiction or other governmental body of a country or any political subdivision thereof of competent jurisdiction; provided, however, that the Receiving Party shall first have given notice to the Disclosing Party and given the Disclosing Party a reasonable opportunity to quash such order and to obtain a protective order requiring that the Confidential Information or documents that are the subject of such order be held in confidence by such court or governmental body or, if disclosed, be used only for the purposes for which the order was issued; and provided further that if a disclosure order is not quashed or a protective order is not obtained, the Confidential Information disclosed in response to such court or governmental order shall be limited to that information which is legally required to be disclosed in such response to such court or governmental order; or (b) otherwise required by law or regulation, in the opinion of outside legal counsel to the Receiving Party, which shall be provided to the Disclosing Party at least 24 hours prior to the Receiving Party’s disclosure of the Confidential Information pursuant to this Section 11. Notwithstanding the foregoing, the Receiving Party may disclose Confidential Information to the extent that such disclosure is made to any Governmental Authority as required in connection with any filing, application or request for any regulatory approval; provided, however, that reasonable measures shall be taken to assure confidential treatment of such information, including without limitation, prior written notice to the Disclosing Party of such disclosure.

11.3         Effects of Termination.  Upon expiration or termination of this License Agreement, each Party shall return to the other Party all Confidential Information received from the other Party, including all copies thereof, or, with such other Party’s written consent, destroy all such Confidential Information.  Notwithstanding the preceding provision, a Receiving Party may retain one archival copy of all such Confidential Information in order to document such Confidential Information that was in the Receiving Party’s possession.  All use of such Confidential Information by a Party shall cease on such termination or request for return.  At the Disclosing Party’s option, the Receiving Party shall also provide written certification of its compliance with this Section 11.3.

12.         Limitations .

12.1        THE PARTIES HERETO AGREE THAT, NOTWITHSTANDING ANY OTHER PROVISION IN THIS LICENSE AGREEMENT, EXCEPT FOR (A) LICENSEE’S BREACH OF SECTION 3 (LICENSE GRANTS) AND (B) EITHER PARTY’S BREACH OF SECTION 11 (CONFIDENTIALITY) ABOVE, NEITHER PARTY NOR ANY OF ITS AFFILIATES SHALL BE LIABLE TO THE OTHER OR ANY OTHER PERSON FOR DAMAGES IN THE FORM OF CONSEQUENTIAL, INCIDENTAL OR SPECIAL DAMAGES, LOST PROFITS, LOST SAVINGS, LOSS OF GOODWILL OR OTHERWISE, OR FOR EXEMPLARY DAMAGES, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

12.2         EXCEPT TO THE EXTENT THAT LIABILITY ARISES OUT OF EITHER PARTY’S BREACH OF SECTIONS 3.1 TO 3.3 (LICENSE GRANTS) OR SECTION 11 (CONFIDENTIALITY) ABOVE, EACH PARTY’S LIABILITY FOR DAMAGES HEREUNDER, WHETHER IN AN ACTION IN NEGLIGENCE, CONTRACT OR TORT OR BASED ON A WARRANTY, SHALL IN NO EVENT EXCEED AN AMOUNT EQUAL TO FOUR AND ONE HALF MILLION EUROS (€4,500,000).

12.3          Notwithstanding anything to the contrary in this License Agreement, the limitations set forth in this Section 12 shall not apply with respect to fraud, intentional misrepresentation, or willful breach or misconduct. 

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13.        Injunctive Relief; Costs of Actions .

Notwithstanding anything to the contrary contained in this License Agreement, each of the Parties hereto acknowledges and agrees that a breach by it of any of the provisions of this License Agreement would cause irreparable injury to the other Party which would not be adequately compensated by money damages.  Accordingly, in addition to any and all other rights and remedies existing, the other Party and/or its successors or assigns shall be entitled to obtain an injunction, specific performance or other appropriate equitable relief upon application to any court of competent jurisdiction in order to enforce or prevent any breach or threatened breach of this License Agreement, in each case without the requirement of posting a bond or proving actual damages.  The prevailing Party in any legal action brought by one Party against the other arising out of this License Agreement, will be entitled, in addition to any other rights it may have, to reimbursement of its costs and expenses associated with such legal action, including court costs and reasonable attorneys’ fees.

14.        Bankruptcy .

14.1      The Parties expressly acknowledge and agree that the subject matter of this Agreement, including the rights licensed to Licensor and Licensee hereunder, are unique and irreplaceable, and that the loss thereof cannot adequately be remedied by an award of monetary compensation or damages.  In the event that this Agreement or the licenses granted pursuant to Section 3 should ever become subject to future United States bankruptcy proceedings, all rights and licenses granted to either Party pursuant to this Agreement (including rights granted under the licenses in Section 3, and the related rights to receive technical material, and respecting the prosecution, maintenance and enforcement of Licensed IP) are, and shall otherwise be deemed to be, licenses of rights to and respecting "intellectual property" and "embodiment[s]" of "intellectual property" for purposes of Section 365(n) and as defined in Section 101(35A) of the U.S. Bankruptcy Code.  Either Party, as a licensee of such rights, may elect to retain and fully exercise all of its rights and elections under Section 365(n) of the Bankruptcy Code, including its retention of all its rights as licensee hereunder, notwithstanding the rejection of this Agreement by the other Party as debtor in possession, or a trustee or similar functionary in bankruptcy acting on behalf of the debtor's estate.  In the event that any such future proceeding shall be instituted by or against the licensing Party or any of its Affiliates seeking to adjudicate it bankrupt, or insolvent, or seeking liquidation, winding up, insolvency or reorganization, or relief of debtors, or seeking an entry of an order of relief, or the appointment of a receiver, trustee or other similar official for it or any substantial part of its property or it shall take any action to authorize any of the foregoing actions (each, a “Bankruptcy Event”), then the licensee Party shall have the right to retain and enforce its rights under this Agreement (including its licenses under Section 3) as provided under Section 365(n) of the Bankruptcy Code. The Parties acknowledge that the licenses granted under Section 3 are executory contracts subject to the provisions of Section 365 of the Bankruptcy Code.

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14.2          In the event that this Agreement or the licenses granted hereunder should ever become subject to future United States bankruptcy proceedings, the licensing Party hereby agrees to waive the provisions of Section 365(c) of the Bankruptcy Code and applicable non-bankruptcy law to the extent such law could operate to prevent the licensee Party, as a debtor in United States bankruptcy cases and in its capacity as a licensee of intellectual property, from assuming the licenses granted hereunder.  The licensing Party hereby irrevocably consents to the assumption of the licensee Party’s license by the licensee Party and any permitted sublicenses granted hereunder by the licensee Party and any permitted assignments or transfers made by the licensee Party notwithstanding any Bankruptcy Event of the licensee Party and the provisions of Section 365(c) of the Bankruptcy Code and applicable non-bankruptcy law to the extent such law could operate to restrict assumption or assignment of the licensee Party’s license.

15.           Miscellaneous Provisions .

15.1         Recordation of Notice of License Agreement.  If Licensee elects to record a notice of this License Agreement with the any Patent Office in the Territory, Licensor will, at the cost and expense of Licensee, render all necessary assistance to Licensee to record such notice and to obtain all necessary governmental approvals with the relevant authorities for the recordation of such notice.  The Parties shall agree on the contents of such notice in advance of its recordation.  For clarity, the notice shall not include any Confidential Information of either Party, including but not limited to the contents of the Schedules attached hereto.

15.2        Notices.  Any notice, request, demand, other communication required or permitted hereunder shall be in writing and shall be deemed to have been given (a) if delivered or sent by facsimile transmission, upon acknowledgment of receipt by the recipient, (b) if sent by a nationally recognized overnight courier, properly addressed with postage prepaid, on the next business day (or Saturday if sent for Saturday delivery) or (c) if sent by registered or certified mail, upon the sooner of receipt or the expiration of three (3) days after deposit in United States post office facilities properly addressed with postage prepaid.  All notices will be sent to the addresses set forth below or to such other address as such Party may designate by notice to each other Party hereunder:

If to Licensor:

 

Plug Power Inc.

968 Albany Shaker Road

Latham, New York 12110

Attention: Gerard L. Conway, Jr.

Facsimile No.: 518.782.7884

E-mail: gerard_conway@plugpower.com

 

With a copy to (copy does not constitute notice):

 

Goodwin Procter LLP

53 State Street, Exchange Place

Boston, MA 02109-2802

Attention: Robert P. Whalen Jr.

Facsimile No: 617.523.1231

E-mail: rwhalen@goodwinprocter.com

 

If to Licensee:

 

Hypulsion

6 rue Cognacq Jay

75007 Paris

France

Attention: President

Facsimile: 00.33.1.34.21.31.94

E-mail: Luc.Vandewalle @airliquide.com

 

 

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With a copy to (copy does not constitute notice):

 

Dechert (Paris) LLP

32, rue de Monceau

75008 Paris

Attention: Ermine Bolot

Fax: 00.33.1.57.57.80.81

Email: ermine.bolot@dechert.com

 

Any notice given hereunder may be given on behalf of any Party by its counsel or other authorized representative.

 

15.3       Captions and Gender.  The captions in this License Agreement are for convenience only and shall not affect the construction or interpretation of any term or provision hereof.  The use in this License Agreement of the masculine pronoun in reference to a Party hereto shall be deemed to include the feminine or neuter pronoun, as the context may require.

15.4       Parties in Interest.  Nothing in this License Agreement, express or implied, is intended to confer on any person other than the Parties and their respective successors and assigns any rights or remedies under or by virtue of this License Agreement.

15.5       Governing Law; Consent to Jurisdiction. 

(a)         All questions concerning the construction, validity and interpretation of this License Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, other than those provisions governing conflicts of law.

(b)         The Parties shall attempt in good faith to resolve any dispute arising out of or relating to this License Agreement promptly by negotiation between executives who have authority to settle the controversy.  Each Party may give to the other written notice of any dispute not resolved in the normal course of business.  Within thirty (30) days after delivery of such notice, the receiving Party shall submit to the other a written response.  The notice and the response shall include a statement of each Party’s position, a summary of arguments supporting that position and the name and title of the executive who will represent that Party and of any other Person who will accompany the executive.  Within thirty (30) days after delivery of the disputing Party’s notice, the executives of both Parties shall meet at a mutually acceptable time and place, and thereafter as often as they reasonably deem necessary, to attempt to resolve the dispute.  All negotiations pursuant to this Section 15.5 are confidential and shall be treated as aimed exclusively at finding a compromise and an amicable solution, but without this being regarded as an admission of liability of whatsoever nature. If the dispute cannot be settled through negotiation within thirty (30) days of the initial meeting of the executives provided for above, then Section 15.5(c) applies.

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(c)         Any dispute arising out of or relating to this Agreement or resulting therefrom that has not been resolved pursuant to Section 15.5(b) shall be subject to arbitration by one or more arbitrators in accordance with the ICC arbitration rules. Arbitration shall take place in Geneva, Switzerland. The arbitration shall be conducted in the English language. Any award rendered by the arbitrators shall be final and binding upon the Parties.  Judgment upon the award may be entered into any court of record of competent jurisdiction.  Each Party shall pay its own expenses of arbitration and the expenses of the arbitrators shall be equally shared unless the arbitrators assess as part of their award all or any part of the arbitration expenses of one Party (including reasonable attorneys’ fees) against the other Party.

(d)         Nothing contained in this Section 15.5 shall prevent the Parties from settling any dispute by mutual agreement at any time.

(e)         As an exception to the above if any dispute arises in connection with this Agreement in the context of a more global dispute between the Parties and Axane under the Master Agreement which is subject to an ICC arbitration procedure, the Parties agree to submit their dispute relating to this License Agreement to the same arbitration panel as the one designated in the context of the arbitration under the Master Agreement.

(f)          Nothing contained in this Section 15.5 shall prevent either Party from immediately pursuing any claim of infringement or misappropriation against any Third Party.

15.6       Assignment.   In recognition of the personal characteristics (“intuitu personae”) of this License Agreement and the licenses granted hereunder, the Parties hereby acknowledge that this License Agreement may not be assigned or transferred without the consent of both Parties, which shall constitute a permitted assignment. In the case of any such permitted assignment, the assignee assumes all responsibilities under this License Agreement.  This License Agreement and the obligations of the Parties hereunder shall be binding upon and enforceable by, and shall inure to the benefit of, the Parties and their respective successors, executors, administrators, estates, heirs and permitted assigns, and no others.  For clarity, and in accord with Section 10.3, this License Agreement shall automatically terminate, and shall not be transferred or assigned if the Licensee entity dissolves.

15.7        Publicity and Disclosures.  Any publication of any press release or other announcement or disclosure (including, without limitation, any such announcement or disclosure to employees or customers of Licensor) with respect to this License Agreement or the transactions contemplated hereby shall be mutually agreed upon, which agreement will not be unreasonably withheld or delayed. 

15.8        Severability.  If any term or other provision of this License Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this License Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any Party.  Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties hereto shall negotiate in good faith to modify this License Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the fullest extent possible.

15.9        Relationship Between Parties.  The relationship between the Parties created under this License Agreement is that of independent contractors.  With respect to the relationship created under this License Agreement, the Parties are not joint venturers, partners, principal and agent, master and servant, employer or employee, and have no relationship other than as independent contracting Parties, and neither Party shall have the power to bind or obligate the other in any manner.

15.10      Entire Agreement.  This License Agreement, including the Schedules hereto, and the documents referred to herein, together with the Master and Shareholder Agreement, contain the entire agreement between the Parties and supersede any prior understandings, agreements or representations by or between the Parties, written or oral, which may have related to the subject matter hereof in any way.

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15.11     Amendments and Waiver.  This License Agreement may not be amended or modified, nor may compliance with any condition or covenant set forth herein be waived, except by a writing duly and validly executed by each of the Parties hereto, or, in the case of a waiver, the Party waiving compliance.  No delay on the part of any Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any Party of any such right, power or privilege, or any single or partial exercise of any such right, power or privilege, preclude any further exercise thereof or the exercise of any other such right, power or privilege.

15.12     Counterparts.  This License Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.  The delivery of a counterpart hereto by facsimile or other electronic transmission shall be deemed an original.

 

[SIGNATURE PAGE FOLLOWS]

 

 

 

 

 

 

 

 

 

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In Witness Whereof, the Parties have caused this License Agreement to be duly executed in their respective names and on their behalf, as of the date first above written.

February 29, 2012	Hypulsion         /s/ Mr. Luc Vandewalle By: Mr. Luc Vandewalle
February 29, 2012	Plug Power, Inc.         /s/ Mr. Gerard L. Conway, Jr. By: Mr. Gerard L. Conway, Jr.

 

 

 

 

 

 

 

 

 

 

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