Form Of Technical Collaboration Agreement - Legal Draft

This

Agreement made on this..day ofBETWEEN an Indian company having

its registered office at.(hereinafter referred to as A) of the one part

anda foreign firm having its principal place of business

at..(hereinafter called B) of the other part.Whereas

A is engaged in the manufacturing and marketing of.and has considerable

engineering know-how and technical information and equipment regarding

said..and their method of manufacture.and

Whereas A is desirous of manufacturing in India and marketing in India and

other countries of various types of items which are set out in Schedule A

hereto annexed (hereinafter referred to as Products) on the terms and

conditions herein contained.Now

Therefore It Is Agreed between the parties that :1.

Know

how means and includes all inventions, processes, patents, engineering and

manufacturing skill and other technical information whether patent or

patentable or not which are presently owned by B or which may be so owned,

during the term of this agreement including without limitation :a. Technical

and engineering data, calculations and information.b. Design

data, calculations and information.c. Details

of layout of works, including details and specification of machineryd. All

other forms of recovered information, technique and design in making of jigs,

tools, dies, patterns and moulds.2.a. B shall fully and

promptly furnish A with such know-how as A may require from time to time

during the term of this agreement in connection with the manufacture of the

products.b. B will depute

technicians at the expense of A to held to establish and operate the

plant at.and to train..Indian technicians in its work in.at

expense of A.c. A at their expense,

shall procure and maintain patents in India on such inventions and improvements

made by A : as A in their sole discretion shall choose. B shall also have

the right to use the invention and improvements in all countries outside Indian

and shall take full title to such procured by B outside India. However, B

shall not, without the consent of A, licence any third party under said

patents except its subsidiaries, its parent company or other subsidiaries of

the parent company.d. A shall manufacture

the Products in strict accordance with the said know-how, the Standard of

quality embodied therein or as may be set from time to time by B. To ensure

the performance of this provision, B shall have the right to inspect at

reasonable intervals and during business hours the facilities of A to the

manufacture of the said PRODUCTS.1.2.3.

Subject

to other provisions of this agreement, B hereby grants to A.a. an

exclusive licence to make in India the products by the use of any or all of

Bs know-how.b. a

non-exclusive licenses to use and sell the said PRODUCTS throughout the world.1.2.3.4.a. in

consideration of B having agreed to disclose to A the latest method of

manufacture of Products and other processes and having further agreed to supply

technical advice and date, A agrees to pay B a sum of ..which due and

payable in installments as follows.i

upon

effective date.ii

upon

delivery by B of the complete design and engineering documents.iii

within.months

after tender or certificate of Discharge of guarantees...Total

..In

consideration of B for having agreed to disclose to A the latest method of

manufacture of products and other process, and having further agreed to supply

technical advice and date, A will arrange to allot Bshares at Rs.each

without any payment by Ba.b.

A

further agrees to pay to B a royalty of..per cent of the net selling price

of the products covered by the agreement for a period of.years from the date

of execution of the agreement. The net selling price would means the ex-works

price of the products covered (less the landed cost of all imported components)

including ocean freight, insurance, customs duties payable thereon, etc.,

irrespective of the source of import. Such royalty payments are subject to

Indian taxes.1.2.3.4.5.a. A

shall render to B bi-annual/annual reports on or before the last day

of..following each calendar year with respect to which royalties are payable

under this agreement, stating the amount of PRODUCT manufactured in the plant

during the preceding year the amount of royalty due and payable with respect

thereto. At the time of rendering such reports A shall pay to B the amount of

royalty stated therein to be due and payable.b. A

agrees to keep complete records of the account concerning the products which

are the subject- matter of this agreement, which records shall be open to

inspection of B its appointed representative agreeable to both parties, during

regular business hours for verifying the payments due to B under this agreement

.1.2.3.4.5.6.

All

payments due by A to B under the agreement are to be made in .. to B's

account in any bank hit designates.1.2.3.4.5.6.7.a. A

shall maintain secrecy at all time during this agreement of all the know how,

drawings and the like disclosed by B to A and/or pursuant to the terms

herein or about which A learns during the performance of this agreement.b. A

will, however, be free to sub-license the technical know-how, product

design/engineering design under the agreement to another Indian party/parties,

should it become necessary. The terms of such sub-licence will, however, be as

mutually agreed to by all parties concerned including B and will be subject

to the approval of the Government.1.2.3.4.5.6.7.8.

This

agreement shall become effective after it has been duly approved and signed by

A and B and the approval of the Government of India has been obtained

thereto.1.2.3.4.5.6.7.8.9.a. This

agreement shall remain effective for a period of.. years from the date of

signing the agreement. Upon the expiration of this agreement, the KNOW HOW

THEREFORE delivered to A shall remain its property for its full and free use

thereof.b. Subject

to the approval of the Indian Government, this agreement may be renewed in

whole or in part for further period by mutual agreement.1.2.3.4.5.6.7.8.9.10. This

agreement shall be binding upon and ensure to the benefit of the successors and

assigns of the respective parties hereto, and the obligations hereunder shall

not be assignable by either party without written consent being first obtained

from the other.11. This

agreement embodies entire understanding of the parties as to its subject

matter, and it shall not be amended except in writing executed by both parties

to the agreement.12. Either

party may by notice in writing to the other terminate this agreement in the

event of :a. Any default by such

other party in the performance or observation of any of its obligations under

this agreement which is not remedied to the satisfaction of the party giving

such notice within ninety (90) days following delivery of such notice, such

notice to contain reasonable particulars of such default and to state the

intention to terminate the agreement under this clause unless such default is

made good or remedied.b. Judicial proceedings

for bankruptcy, composition with creditors, sequestration of assets for

creditors, or receivership instituted by or against such other party,

insolvency of such other party or its failure to meet its obligations as they

mature for any material period of time.c. Liquidation ,

compulsory or voluntary of such other party except in connection with an

amalgamation, reconstruction, merger, consolidation, re-organisation or

disposition of assets as a going concern voluntarily undertaken and with a view

to the continuance of the business by the transferee thereof, provided,

however, that upon such event the business entity continuing the business

formerly carried on by such other party shall, in an appropriate instrument

delivered to the other party to this agreement, undertake to perform all of the

obligations of such other party hereunder.1.2.3.4.5.6.7.8.9.10.11.12.13. Neither

party shall be in default under this agreement by reason of its failure or

delay in the performance of its obligations is such failure or delay is caused

by acts of God, Government laws and regulations, strikes, lock-outs, war or any

other cause beyond its control and without its fault or negligence.14. All

disputes, questions, or differences, etc., arising in connection with this

agreement shall be referred to a single arbitrator in India in case parties

agree upon one, otherwise two arbitrators in India are to be appointed by each

party in accordance with and subject to the provision of the Arbitration &

Conciliation Act, 1996, or any other enactment or statutory modification

thereof for the time being in force.15. Notices

and other communications under the agreement shall be in writing, or by

established cable, radio or facsimile service, addressed as indicated in the

description of parties above or as either party may request in writing, and the

effective date of each is the date of its repaid deposit in the mail for

dispatch by air or such service properly addressed.16. The

agreement should be construed in accordance with and be governed by the laws of

India.In

Witness Whereof, the parties hereto have executed this agreement as of the date

first above written.For

B.(Chairman

of the Board)For

A.(Director)