the construction and operation of a SiC Fiber factory and perform related knowledge transfer andother services on behalf of ESLR1 all on the terms and conditions set forth herein; and     NOW THEREFORE, in consideration of the mutual covenants and agreements set forth herein, ESLR1and TISICS hereby agree as follows:1. **Definitions**     1.1 “Affiliate” means, with respect to an entity, any entity that directly, or through one ormore intermediaries, controls, is controlled by, or is under common control with such entity, asapplicable, where “control” for purposes of this definition means the ownership of at least fiftypercent (50%) of such company’s or entity’s capital stock or the power to direct or cause thedirection of such company’s or entity’s management, whether by ownership of securities, by contractor otherwise.     1.2 “Composite Field” means [****]     1.3 “Controlled” or “Controls”, when used in reference to the rights of a Party or a Party’sAffiliate(s) in and to Technology or Intellectual Property Rights, means that such entity owns orpurports to own or has the right or purports to have the right to grant a license or sublicensewith respect to such Technology or Intellectual Property Rights to the other Party as provided forherein without breaching the terms of any agreement such entity has with a Third Party.     1.4 “Encumbrances” means any Liens, agreements, voting trusts, proxies and other arrangementsor restrictions of any kind whatsoever.     1.5 “ESLR1 Competitor” means any Third Party that manufactures, sells or provides products orservices in the PV Field, plus any other Third Party that manufactures, sells or provides productsor services relating to strings of material. For the avoidance of doubt and without limitation,the following entities are ESLR1 Competitors as of the Effective Date: Sharp, Q-Cells, Kyocera,REC, Sanyo, BP Solar, Mitsubishi Electric, Schott, Shell, Isophoton, SolarWorld, Photowatt, GE,Suntech, Motech, Kaneka, ErSol, ECD, Sunways, First Solar, Solarfun, SunPower, MEMC, Crystalox,Solarforce, Solon and Conergy.     1.6 “ESLR1 IP” means all Intellectual Property Rights Controlled by ESLR1 as of or during theGrantback License Term that is embodied in Technology (including Improvements) related to the useof SiC Fiber-related Technology, excluding the TISICS IP.
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     1.7 “ESLR1 Facilities” means, collectively, (i) manufacturing facilities for the Exploitationof SiC Fiber and (ii) any equipment installed or used in such facilities, in each case that areowned or controlled primarily by or on behalf of ESLR1 or a ESLR1 Sublicensee.     1.8 “Exploit” means to make, have made, import, sell, have sold, offer for sale and otherwiseuse, including, but not limited to, to research, design, develop, register, modify, enhance,improve, manufacture, export, transport, distribute, promote, market or otherwise commercialize.     1.9 “Governmental Entity” means (i) any federal, state, local, municipal, foreign or othergovernment; (ii) any governmental or quasi-governmental authority of any nature (including anygovernmental agency, branch, department, official, entity or self-regulatory organization and anycourt or other tribunal); or (iii) any body exercising, or entitled to exercise, anyadministrative, executive, judicial, legislative, police, regulatory, or taxing authority or powerof any nature, including any arbitral tribunal     1.10“Grantback License Term” means [****] commencing on the Effective Date, plus, ifon the [****] anniversary of the Effective Date TISICS owns at least [****] of ESLR1’soutstanding LLC Units (as defined in the Contribution Agreement), for so long after such [****]anniversary that TISICS owns at least [****] of ESLR1’s outstanding LLC Units, in eachcase, unless this Agreement is earlier terminated.     1.11 “Improvements” means all Technology that constitutes an improvement, enhancement,alteration or modification to or of any Technology.     1.12 “Intellectual Property Rights” means, collectively, all rights in, to and under (i)Patents, (ii) registered and unregistered copyrights and (iii) all other intellectual propertyrights (including trade secret rights, trademarks, service marks, trade dress and similar rights ofany type under the laws of any governmental authority), including all applications andregistrations relating to the foregoing.     1.13 “Joint IP” means all Intellectual Property Rights embodied in Technology that is jointlyinvented, created or developed by one or more employees, consultants or contractors of each Party.     1.14 “Key Customer” means, [****]     1.15 “Laws” means any federal, state, local, municipal or foreign statute, law, ordinance,regulation, rule, code, order, principle of common law or judgment enacted, promulgated, issued,enforced or entered by any Governmental Entity, or other requirement or rule of law.     1.16 “Lien” or “Liens” means any mortgage, pledge, security interest, encumbrance, lien orcharge of any kind or any subordination arrangement in favor of another Person.
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     1.17 “Other Fields” means fields not included within the PV Field or Composite Field.     1.18 “Patents” means patents and patent applications (which for the purposes of this Agreementshall be deemed to include certificates of invention and applications for certificates ofinvention), including provisionals, divisionals, continuations, continuations-in-part, reissues,reexaminations, renewals, extensions, supplementary protection certificates, and the like of anysuch patents and patent applications, and any foreign equivalents thereof, and shall includepatents whose term has been extended by statutory patent term adjustments in any jurisdiction inthe world, including those patent term adjustments granted under 35 U.S.C. § 154(b).     1.19 “Person” means an individual, a partnership, a corporation, a limited liability company,an association, a joint stock company, a trust, a joint venture, an unincorporated organization anda governmental entity or any department, agency or political subdivision thereof.     1.20 “PV Field” means (i) [****], and (ii) [****].     1.21 “Sold” shall mean having closed a transaction under which ESLR1 or any ESLR1 Sublicenseeactually derives revenues from any sale, conveyance or other transfer of SiC Fiber (for clarity,excluding bad debt transactions which do not involve Evergreen and returns of SiC Fiber). Any suchtransaction shall be referred to as a “Sale”. Further, any inventory of SiC Fiber that ispurchased by Evergreen or any of Evergreen’s Affiliates and that is held in ESLR1’s or a ESLR1Sublicensee’s inventory for more than a period of [****] days after such purchase shall be deemedto have been Sold upon the expiration of such period.     1.22 “SiC Fiber” means [****]     1.23 “Technology” means, collectively, (i) know-how, show-how, trade secrets, inventions,discoveries, developments, methods, modifications, designs, chemical and biological materials,formulae, processes, information, documents, studies, techniques, algorithms, results, data, datastructures, databases, data collections, mask works, manufacturing processes and data,specifications, sourcing information, supplier and customer lists, and quality control and testingprocedures, and (ii) original published and unpublished works of authorship fixed in a tangiblemedium of expression, including software and code (including software and firmware listings,assemblers, applets, compilers, source code, object code, net lists, design tools, user interfaces,application programming interfaces, protocols, formats, documentation, annotations, comments,system build software and instructions), graphics or images, text, audio or visual works, materialsthat document design or design processes, or that document research or testing, schematics,diagrams, product specifications and other works of authorship, in each case of clauses (i) and(ii), whether or not patented or patentable and whether or not in written form.     1.24 “Third Party” shall mean any Person, other than ESLR1, TISICS and their respectiveAffiliates.     1.25 “TISICS Competitor” means any Third Party that (i) develops, manufactures, distributes orsells composite materials or components utilizing silicon carbide monofilaments in
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the CompositeField and/or (ii) develops, manufactures, distributes or sells silicon carbide fiber or similarfilamentary reinforcements in the Composite Field.     1.26 “TISICS IP” means all Intellectual Property Rights Controlled by TISICS or any of itsAffiliates as of the Effective Date or during the Term that is embodied in Technology (includingImprovements) related to (a) the research, design, development, manufacture or testing of SiC Fiberor (b) the planning, design, construction, commissioning, operation, maintenance, support or otheruse (collectively, “Construction and/or Operation”) of the ESLR1 Facilities. A description ofTISICS IP existing as of the Effective Date is set forth in Exhibit B. For the avoidanceof doubt, TISICS IP shall not include any Intellectual Property Rights embodied in Technology orImprovements created after the Effective Date that are identified pursuant to a written noticedelivered in good faith by TISICS to ESLR1 as not Controlled by TISICS, which notice (i) isdelivered on or prior to TISICS’ first delivery or making available of any such Technology orImprovements to ESLR1 and (ii) describes the substance of such Technology or Improvements andidentifies the applicable Third Party that owns or controls such Technology or Improvements.2. **License**.     2.1 TISICS IP License.          (a) *License*. TISICS, for itself and on behalf of its Affiliates, hereby grants ESLR1 anirrevocable, perpetual, worldwide, royalty-bearing (in accordance with Section 4 and subject toSection 4.4), transferable (in accordance with Section 11.7), sublicensable (in accordance withSection 2.1(b)) right and license under the TISICS IP within the PV Field only to (i) Exploit SiCFiber, (ii) Construct and/or Operate the ESLR1 Facilities and (iii) copy, distribute, display,perform and modify (including the right to create derivative works (for use in the PV Field only)of) the TISICS IP for the purpose of engaging in the activities described in the foregoing clauses(i) and (ii). The license granted pursuant to the preceding sentence shall be exclusive (even asto TISICS and its Affiliates) in the PV Field.          (b) *Sublicensing*. The license contained in Section 2.1(a) includes the right to grantsublicenses in the PV Field only to Third Parties other than TISICS Competitors (each Third Partysublicensee, a “ESLR1 Sublicensee”), provided that ESLR1 shall remain responsible for theperformance of the ESLR1 Sublicensees hereunder and any such sublicense granted by ESLR1 shall bepursuant to a written agreement that is at least as protective of TISICS, with respect to thelicense contained in Section 2.1(a), as this Agreement and provided that TISICS has consented tothe granting of such sublicense, such consent not to be unreasonably withheld or delayed, providedfurther that ESLR1 may grant Evergreen and Evergreen’s Affiliates a sublicense without TISICS’consent or any requirement of a written agreement (but subject to prior written notice of suchsub-license being given to TISICS). ESLR1 Sublicensees shall not have the right to grant anyfurther sublicenses under any such sublicense granted by ESLR1. The terms of the agreement withESLR1 Sublicensees will expressly prohibit in writing all of its ESLR1 Sublicensees from exercisingthe license grant contained in Section 2.1(a) (but not any other sublicenses such ESLR1 Sublicenseemay be granted, for example, under the CompositeField License Agreement or Other Fields License Agreement) outside the PV Field. Subject toSection 2.5, any purchaser of SiC Fiber in the PV Field shall, by operation of this Agreement,
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receive the right to sell, offer for sale, resell, offer for resale, import and otherwise use suchSiC Fiber in the PV Field by operation of the patent exhaustion/first sale doctrine, but otherwiseshall receive no licenses, sublicenses or other rights under the TISICS IP by virtue of itspurchase of SiC Fiber in the PV Field from ESLR1 or a ESLR1 Sublicensee.     2.2 Reservation of Rights. Subject to Section 2.3(d), ESLR1 shall acquire no right,title or interest in, to or under, and TISICS and its Affiliates hereby reserve all right, titleand interest in, to and under, the TISICS IP, by implication, estoppel or otherwise, other than theexpress license grant to ESLR1 set forth in Section 2.1(a) or as otherwise expressly providedherein.     2.3 Ownership of Intellectual Property Rights. The following shall apply to allTechnology (and all Intellectual Property Rights embodied therein) invented, created or developedunder this Agreement, the Other Fields License Agreement, the Composite Field License Agreement,the Supply Agreement, the Facilities and Start Up Agreement and any other written agreement betweenthe Parties during the respective terms of such agreements:          (a) *TISICS IP*. As between the Parties, TISICS and/or its Affiliate(s) shall have exclusiveownership of the TISICS IP.          (b) *ESLR1 IP*. As between the Parties, ESLR1 shall have exclusive ownership of the ESLR1 IP.          (c) *Newly Developed Intellectual Property*. As between the Parties, subject to Section 2.3(d),(i) TISICS and/or its Affiliate(s) shall have exclusive ownership of (A) all Technology (and allIntellectual Property Rights embodied therein) invented, created or developed by one or moreemployees, consultants or contractors of TISICS and/or its Affiliate(s), as applicable, during theTerm without any employees, consultants or contractors of ESLR1, except to the extent that any suchTechnology constitutes an Improvement solely to the ESLR1 IP or any other Intellectual PropertyRights then-Controlled by ESLR1 (*i.e.*, such Technology does not constitute an Improvement to any ofthe TISICS IP or Joint IP) (such Improvement, a “ESLR1 IP Improvement”), and (B) TISICS IPImprovements (as defined below) and (ii) ESLR1 shall exclusively own (A) all Technology (and allIntellectual Property Rights embodied therein) invented, created or developed by one or moreemployees, consultants or contractors of ESLR1 and/or its Affiliate(s), as applicable, during theTerm without any employees, consultants or contractors of TISICS or Affiliates of TISICS, except tothe extent that any such Technology constitutes an Improvement solely to the TISICS IP or any otherIntellectual Property Rights then-Controlled by TISICS and/or its Affiliate(s) (i.e., suchTechnology does not constitute an Improvement to any of the ESLR1 IP or Joint IP) (suchImprovement, a “TISICS IP Improvement”) and (B) ESLR1 IP Improvements.          (d) *Joint IP*. If Technology is jointly invented, created or developed by one or moreemployees, consultants or contractors of each of ESLR1 and/or its Affiliate(s), on the one hand,and TISICS and/or its Affiliate(s), on the other hand, then such Technology, and all JointIP therein, shall be jointly owned by ESLR1, on the one hand, and TISICS and/or itsAffiliate(s), on the other hand, as applicable, without any duty to account.
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          (e) *Assignment*. To the extent any Party or its Affiliates retains any ownership interest in,to or under any Technology or Intellectual Property Rights that are properly owned (in accordancewith this Section 2.3) by the other Party or such other Party’s Affiliates, such Party herebyassigns, and will assign, on behalf of itself and its Affiliates, to such other Party or such otherParty’s Affiliates, as applicable, all of its ownership interest in, to and under such Technologyand Intellectual Property Rights in all countries and territories worldwide and under anyinternational conventions, free and clear of any and all Encumbrances. Each Party shall provide tothe other Party all assistance (including the execution of any applicable documents of assignmentor registration) reasonably requested by such other Party to perfect the rights described in thisSection 2.3.          (f) *Licenses*. For the avoidance of doubt and without limitation, the Intellectual PropertyRights embodied in the Technology covered by this Section 2.3 shall be deemed TISICS IP or ESLR1IP, as applicable, and thus subject to the licenses granted in the applicable agreement between theParties, to the extent the scope of the definitions of “TISICS IP” or “ESLR1 IP”, respectively,cover such Technology.     2.4 Assignment of Inventions by Personnel. Each Party shall enter into bindingagreements obligating all employees, consultants and contractors performing activities related to,under or as contemplated by this Agreement, the Other Fields License Agreement, the Composite FieldLicense Agreement, the Supply Agreement, the Facilities and Start Up Agreement or any other writtenagreement between the Parties (i) to assign his/her interest in any Technology conceived or reducedto practice in the course of such activities (and all Intellectual Property Rights therein) to theParty for which such employee, consultant or contractor is providing its services and (ii) tomaintain the confidentiality of the same in accordance with reasonable confidentiality provisionsat least as protective of the Technology and Intellectual Property Rights owned by the other Partyor such other Party’s Affiliates as those provisions set forth in Section 6.     2.5 Third Party Sales. All sales of SiC Fiber to Third Parties by ESLR1 and ESLR1Sublicensees must contain appropriate restrictions preventing the use by Third Parties of SiC Fiberin the Composite Field, whether directly or as a recycled material. If ESLR1 becomes aware of anyuse by a Third Party of such SiC Fiber in the Composite Field, ESLR1 shall reasonably cooperatewith TISICS, at TISICS’ cost, in enforcing such restrictions.     2.6 Field Limitation. For the avoidance of doubt, without limiting and subject to therights granted pursuant to the Composite Field License Agreement, ESLR1 shall not intentionallydevelop Technology under the license granted in Section 2.1(a) that is specifically and exclusivelytargeted for the production and use of SiC Fiber in the Composite Field.3. **Delivery of TISICS IP; Other Obligations**.     3.1 Delivery of TISICS IP.          (a) As soon as practicable after the Effective Date, TISICS shall make available forinspection by ESLR1, in hardcopy or electronic format, a copy of documents relevant to theConstruction and/or Operation of the ESLR1 Facilities and to the manufacture of
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SiC Fiber(excluding, for clarity, any documents that are irrelevant to the performance of such activities inthe PV Field), including documents, drawings and specifications (“TISICS Materials”), in each case,existing as of the Effective Date and for use in the PV Field. TISICS shall provide ESLR1 withcopies of such TISICS Materials that are material to the performance of such activities in the PVField as soon as commercially possible but in any event within the earlier of (i) [****] calendardays following the Effective Date or (ii) [****] calendar days after the receipt of written noticefrom ESLR1 if ESLR1 determines in good faith that TISICS is not cooperating with ESLR1 or otherwisenot complying with its obligations in this Section 3.1(a), in each case, which TISICS Materialsshall include the documents, drawings and specifications set forth in Exhibit C.          (b) Thereafter, TISICS shall continue to give ESLR1 access to TISICS Materials as ESLR1 mayreasonably request for the purposes of ESLR1’s Construction and/or Operation of the ESLR1Facilities and manufacturing of SiC Fiber in the PV Field. Further, TISICS shall [****] develop aprocess for manufacturing SiC Fiber for use in the PV Field that is reasonably acceptable to ESLR1.Without limiting any of ESLR1’s remedies, TISICS shall deliver to ESLR1 copies of all TISICSMaterials (for any field) not already delivered to ESLR1 within one (1) month of the occurrence ofany of the following: (A) TISICS having not developed such a process within [****] afterthe Effective Date or (B) ESLR1 delivering written notice to TISICS at any time that TISICS is notusing its best efforts to develop such a process, provided that TISICS shall have [****] afterreceiving such notice to cure such failure to [****]. For the purposes of assessing [****] ofTISICS, TISICS shall provide monthly plans indicating milestone targets for the development of suchprocess in accordance with such [****] timetable, which plans shall be subject to the writtenapproval of ESLR1. The Parties acknowledge that the direction and timescales of such plans willevolve as work progresses and TISICS and ESLR1 will work in good faith to keep the milestone planscurrent to the progress achieved.          (c) The Parties acknowledge that the initial specifications for SiC Fiber for use withEvergreen’s String Ribbon process are set forth in Exhibit A, and that such specificationsrepresent a starting point for the development of SiC Fiber by the Parties for use in the PV Field.The Parties shall work together in good faith to improve and modify such specifications, inconjunction with the development of a process for manufacturing SiC Fiber for use in the PV Field,to achieve the SiC Fiber performance and quality characteristics reasonably required by ESLR1.          (d) Where TISICS requires String Ribbon process trials in order to assess the performance ofthe SiC Fiber during development, these trials will be conducted in a timely manner and any delaythat may be required by Evergreen and/or ESLR1 for operational reasons will be added to thedelivery time frame referred to in 3.1(b)(A) above. Evergreen and/or ESLR1 will provide TISICSwith timely feedback with respect to such trials and will specify to TISICS which aspects of thetested SiC Fiber does not provide the performance and functionality required by Evergreen and/orESLR1.          (e) TISICS’ obligations to make and deliver copies of TISICS Materials shall be subject to anyapplicable Third Party copyright and confidentiality agreements. TISICS shall deliver to ESLR1updates (if any) to such TISICS Materials on no less than a calendar quarterly
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basis to reflectchanges in or additions to (if any) the TISICS Materials. Further, TISICS shall update ExhibitB upon ESLR1’s reasonable request in order to maintain an up-to-date inventory of TISICS IPwithin the PV Field. and at a minimum to maintain a complete and accurate list of all Patentscontained within the TISICS IP (the “TISICS Patents”).     3.2 Fiber Development Documentation. At the Effective Date TISICS will not be able todetermine which TISICS IP is essential to the development, manufacture and maintenance of SiC Fiberfor the PV Field. Without limiting the generality of Section 3.1, upon completion of thedevelopment of Technology for manufacturing SiC Fiber in the PV Field, TISICS will provide allTISICS Materials generated for such Technology and any background TISICS Materials deemed to beessential for the future maintenance and control of such Technology.     3.3 Outsourced Services. Notwithstanding the foregoing, the Parties acknowledge andagree that ESLR1 may request that Evergreen (or any of ESLR1’s other Affiliates), TISICS (or any ofTISICS’ Affiliates) or Third Parties perform, whether on a permanent or temporary basis, certainservices (such as services relating to infrastructure, management, operations, technology supportand development) to the extent that ESLR1 determines, after consultation with the relevant entity,that such entity can perform such services on a more cost-effective basis than if ESLR1 were toperform such services itself. To the extent that Evergreen (or any of ESLR1’s other Affiliates) orTISICS (or any of TISICS’ Affiliates) agrees to perform such services, ESLR1 shall pay for suchservices on a cost-plus basis to be reasonably determined by the applicable parties. Outsourcing toa TISICS Competitor for performance of the services described in this section will be subject tothe consent of TISICS, such consent to be withheld by TISICS in its sole discretion.     3.4 Compliance with Laws. The Parties shall comply with all applicable Laws(including any intellectual property marking Laws) in the exercise of their rights or performanceof their obligations hereunder.4. **Payments**.     4.1 Payments. Subject to the terms and conditions hereof (including Section 4.4),ESLR1 shall pay TISICS the Conditional Fees and PV Royalties (each as defined in Exhibit D)as set forth in Exhibit D.          (a) Further, subject to Section 4.4, in the event (i) ESLR1 grants a sublicense to a ThirdParty (other than a Key Customer of ESLR1) pursuant to Section 2.1(b) and (ii) in consideration forthe grant of such sublicense, such ESLR1 Sublicensee pays ESLR1 amounts in the form of a royalty orsublicense fee based on the Sale of SiC Fiber by such ESLR Sublicensee in the PV Field, whichamounts are in excess of the PV Royalties payable to TISICS hereunder based on such Sale or, ifapplicable, the underlying sale which triggered ESLR1’s obligation to pay PV Royalties (suchexcess, the “Excess Fees”), then during the Term ESLR1 shall pay TISICS an amount (the “PV SharedExcess Fees”) equal to the Excess Percentage (as definedbelow) of the Excess Fees received by ESLR1. The “Excess Percentage” shall equal (i) [****]percent ([****]%) if TISICS has not exercised Tranche One (as defined in that certain LLCMembership Interest Purchase Option granted to TISICS dated as of September 5, 2007 (the
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“Option”)), (ii) [****] percent ([****] %) if TISICS exercises Tranche One or (iii) [****] percent([****] %) if TISICS exercises Tranche Two (as defined in the Option).          (b) ESLR1 shall not have any obligation to pay any PV Shared Excess Fees based on thefollowing: (i) any sales by Evergreen, ESLR1’s other Affiliates or ESLR1’s Key Customers as ELSR1Sublicensees hereunder, (ii) any sales by ESLR1 Sublicensees of SiC Fiber to Evergreen, ESLR1’sother Affiliates or ESLR1’s Key Customers in or after Period 7 or to Third Parties (other thanESLR1’s Key Customers) in or after Year 11; and (iii) any sales by ESLR1 Sublicensees of SiC Fiberto the extent that the the manufacture or sale of such SiC Fiber does not infringe ormisappropriate or otherwise involve the use of any of the the TISICS IP (other than any Joint IP).     4.2 Payment Terms; Reports; Records; Taxes; Audits.          (a) *Payment*. All payments to be made by ESLR1 hereunder shall be made in U.S. dollars by wiretransfer to such bank account as TISICS may designate.          (b) *Reports*. For as long as PV Royalties or PV Shared Excess Fees are due hereunder, ESLR1shall furnish to TISICS a written report, within [****] days after the end of each calendarquarter, showing the amount of (i) SiC Fiber Sold for which PV Royalties and/or PV Shared ExcessFees are due hereunder and (ii) the PV Royalties and/or PV Shared Excess Fees due for such calendarquarter. PV Royalty and PV Shared Excess Fee payments for each calendar quarter shall be due atthe same time as such written report for such calendar quarter. All such reports shall be treatedas Confidential Information of ESLR1.          (c) *Records*. ESLR1 and ESLR1 Sublicensees shall keep adequate books and records of accountingfor the purpose of calculating all PV Royalties and PV Shared Excess Fees payable to TISICShereunder. For the [****] years following the end of the calendar year to which each shallpertain, such books and records of accounting shall be kept at each of their principal place ofbusiness and shall be open for inspection at reasonable times and upon reasonable notice by anindependent certified accountant selected by TISICS, and which is reasonably acceptable to ESLR1,for the sole purpose of inspecting the PV Royalties and PV Shared Excess Fees due to TISICS underthis Agreement. In no event shall such inspections be conducted hereunder more frequently thanonce every [****]. Such accountant must have executed and delivered to ESLR1 and ESLR1Sublicensees, as applicable, a confidentiality agreement as reasonably requested by ESLR1, whichshall include provisions limiting such accountant’s disclosure to TISICS to only the results andbasis for such results of such inspection. The results of such inspection, if any, shall bebinding on both Parties. Any underpayments shall be paid by ESLR1 within [****] days ofnotification of the results of such inspection. Any overpayments shall be fully creditable againstamounts payable in subsequent payment periods. TISICS shall pay for such inspections, except thatin the event there is any upward adjustment in aggregate PV Royalties and PV Shared Excess Feespayable for any calendar year shown by such inspection of more than [****] percent ([****] %) ofthe amount paid, ESLR1 shall reimburse TISICS for any reasonable out-of-pocket costs of suchaccountant.     4.3 Taxes and Interest; Setoff.
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          (a) *Taxes*. Any applicable withholding tax shall be deducted by ESLR1 from any payments dueunder this Agreement and borne by TISICS. ESLR1 shall cooperate with TISICS to enable TISICS toclaim exemption therefrom under any double taxation or similar agreement in force and shall usecommercially reasonable efforts to provide to TISICS proper evidence of payments of withholding taxand assist TISICS by obtaining or providing in as far as possible the required documentation forthe purpose of TISICS’ tax returns.          (b) *Interest*. ESLR1 shall pay TISICS interest on any payments that are not paid on or beforethe date such payments are due under this Agreement at a rate of one and one-half percent (1.5%)per month or the maximum applicable legal rate, if less, calculated on the total number of dayspayment is delinquent.          (c) *Setoff*. ESLR1 shall have the right to setoff any PV Royalties and PV Shared Excess Feesdue TISICS hereunder against amounts owed by TISICS to ESLR1 under the Supply Agreement, providedthat PV Royalties and PV Shared Excess Fees will first be set-off against payments due under thatcertain Promissory Note, dated as of September 5, 2007 (“Loan Agreement”), and only to the extentthat there are any remaining PV Royalties and PV Shared Excess Fees available for set-off aftersuch payments have been made, will these be applied against amounts due by TISICS to ESLR1 underthe Supply Agreement.          (d) *Credits Against Overhead Payments*. Further, ESLR1 shall have the right to credit any PVRoyalties, PV Shared Excess Fees, Conditional Fees or other amounts due to TISICS hereunder againstany Overhead Overage Payments (as defined in the Facilities and Start Up Agreement) made to TISICSunder the Facilities and Start Up Agreement. For the avoidance of doubt, even if ESLR1 does notcredit such PV Royalties, PV Shared Excess Fees, Conditional Fees or other amounts due to TISICShereunder against such Overhead Overage Payments, the amount of Overhead Overage Payments againstwhich such royalties, fees or amounts are creditable under this Section 4.3(d) shall not bearinterest or be refundable (without limiting the refundability of Overhead Overage Payments forother reasons).          (e) *Priority*. After the Maturity Date (as defined in the Loan Agreement), any PV Royaltiesand PV Shared Excess Fees that may be set-off or credited in accordance with Section 4.3(c) or4.3(d) shall first be set-off against amounts owed by TISICS to ESLR1 under the Supply Agreement orLoan Agreement pursuant to Section 4.3(c) before such PV Royalties and PV Shared Excess Fees may becredited against Overhead Overage Payments pursuant to Section 4.3(d).     4.4 Default of Note. If Evergreen elects to exercise its Note Default Option (asdefined in the Loan Agreement), then automatically, without any further action of the Parties, (i)the license set forth in Section 2.1(a) shall become royalty-free and fully paid-up, (ii) ESLR1shall not owe any future Conditional Fees, PV Royalties and/or PV Shared Excess Fees or otherfuture fees or payments hereunder, and (iii) Sections 4.1, 4.2, 4.3(b) and Exhibit D shallterminate and have no further force or effect.5. **Prosecution; Infringement****.**
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     5.1 Appointment and Cooperation. With respect to the rights and activities of ESLR1set forth in this Section 5, TISICS hereby appoints ESLR1 as its agent for such purposes with theauthority to act on TISICS’ behalf with respect to the TISICS IP relating to the PV Field. TISICSshall cooperate with ESLR1 in the exercise of ESLR1’s authority granted herein, and shall executesuch documents and take such additional action as ESLR1 may reasonably request in connectiontherewith.     5.2 Patent Prosecution and Maintenance.          (a) *By TISICS*. TISICS shall, at its sole cost, be solely responsible for and make alldecisions with respect to the preparation, prosecution (including any interferences, oppositions,reissue proceedings and reexaminations) and maintenance of the TISICS Patents. TISICS shallprovide to ESLR1 copies of any papers relating to the filing, prosecution or maintenance of TISICSPatents within the PV Field promptly upon receipt and shall provide ESLR1 with a reasonableopportunity to review and comment on such papers with respect to applications within the PV Field.          (b) *By ESLR1*. TISICS shall not knowingly permit any of the TISICS Patents within the PV Fieldto be abandoned in any country without ESLR1 first being given an opportunity to assume fullresponsibility for the continued prosecution and maintenance of same. In the event that TISICSdecides not to continue the prosecution or maintenance of any TISICS Patent within the PV Field inany country, TISICS shall provide ESLR1 with notice of this decision at least [****] days prior toany pending lapse or abandonment thereof. In the event that ESLR1 elects to assume responsibilityfor such prosecution and maintenance within [****] days of TISICS’ notice, Section 5.2(a) shallthereafter apply to such TISICS Patent(s) except that the role of TISICS and ESLR1 shall bereversed thereunder (including that ESLR1 shall be solely responsible for all costs arising fromthose activities). Such TISICS Patent(s) shall otherwise continue to be subject to all of theterms and conditions of the Agreement in the same way as the other TISICS Patents within the PVField.     5.3 Enforcement of TISICS IP.          (a) *Notice of Infringement*. In the event that either Party becomes aware of a suspectedinfringement or misappropriation of the subject matter of any TISICS IP in the PV Field, or anysuch TISICS IP is challenged in any action or proceeding (other than any patent interferences,oppositions, reissue proceedings or reexaminations, which are addressed in Section 5.2), such Partyshall notify the other Party promptly, and following such notification, the Parties shall confer.          (b) *Enforcement*. In the case of infringement or misappropriation of the TISICS IP in the PVField, ESLR1 shall have the right, but not the obligation, to initiate and prosecute such legalaction or proceeding or to control the defense of any action or proceeding relating to the ESLR1 IP(other than any patent interferences, oppositions, reissue proceedings or reexaminations, which areaddressed in Section 5.2), in its own discretion and at its own expense. If ESLR1 fails to takesteps reasonable under the circumstances to resolve such actual or suspected infringement ormisappropriation or initiate a lawsuit within [****] days of receiving written notice of suchactual or suspected infringement or misappropriation from TISICS or delivering written notice ofsuch actual or suspected infringement to TISICS, as applicable, TISICS shall have the right, butnot the obligation, to initiate an action or proceeding, in its own discretion and at its ownexpense.
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          (c) *Withdrawal*. If either Party brings an action or proceeding under this Section 5.3 andsubsequently ceases to pursue or withdraws from such action or proceeding, it shall promptly notifythe other Party and the other Party may substitute itself for the withdrawing Party under the termsof this Section 5.3.          (d) *Recovery Allocation*. In the event that either Party exercises the rights conferred inthis Section 5.3 and recovers any damages or other sums in such action or proceeding or insettlement thereof, such damages or other sums recovered shall first be applied to allout-of-pocket costs and expenses incurred by the Parties in connection therewith (includingattorneys’ fees), unless not reimbursable hereunder. If such recovery is insufficient to cover allsuch costs and expenses of both Parties, the controlling Party’s costs shall be paid in full firstbefore any of the other Party’s costs. If after such reimbursement any funds shall remain fromsuch damages or other sums recovered, such funds shall be retained by the Party that controlled theaction or proceeding under this Section 5.3.6. **Confidentiality****.**     6.1 Definition of Confidential Information. “Confidential Information” means, subjectto the exceptions set forth below in Section 6.2, any information or data, regardless of whether itis in tangible form, of a Party (the “Disclosing Party”) that the Disclosing Party has eithermarked as confidential or proprietary, or has identified in writing as confidential or proprietarywithin thirty (30) days of disclosure to the other Party (the “Receiving Party”), and has providedto the Receiving Party under this Agreement; provided that any Disclosing Party’s business plans,strategies, Technology, customers, customer lists, billing records and products shall be deemedConfidential Information of the Disclosing Party even if not so marked or identified and the termsof this Agreement will be deemed Confidential Information. For the avoidance of doubt, any tradesecrets contained within the TISICS IP with application in the PV Field shall be deemed theConfidential Information of both Parties, subject to the provisions of this Section 6.     6.2 Exceptions. The obligations in Section 6.1 shall not apply with respect to anyportion of the Confidential Information that the Receiving Party can show by competent proof: (i)is publicly disclosed by the Disclosing Party, either before or after it is disclosed to theReceiving Party hereunder; (ii) was known to the Receiving Party or any of its Affiliates, withoutany obligation to keep it confidential or any restriction on its use, prior to disclosure by theDisclosing Party; (iii) is subsequently disclosed to the Receiving Party or any of its Affiliatesby a Third Party lawfully in possession thereof and without any obligation to keep it confidentialor any restriction on its use; (iv) is published by a Third Party or otherwise becomes publiclyavailable or enters the public domain, either before or after it is disclosed to the ReceivingParty; or (v) has been independently developed by employees or contractors of the Receiving Partyor any of its Affiliates without the aid, application or use of Confidential Information of theDisclosing Party.     6.3 Confidentiality Obligations. Except as expressly provided herein, each of theParties agrees that, for itself and its Affiliates, and for as long as this Agreement is in effectand thereafter, a Party and its Affiliates (the “Receiving Party”) receiving ConfidentialInformation of the other Party or its Affiliates (the “Disclosing Party”) shall not (i) use anysuch Confidential Information in any way, for its own account or the account of any Third Party,except for the
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exercise of its rights and performance of its obligations under this Agreement, or (ii)disclose any such Confidential Information to any party, other than furnishing such ConfidentialInformation to (a) its employees and consultants who are required to have access to theConfidential Information in connection with the exercise of its rights and performance of itsobligations under this Agreement, (b) investors, prospective acquirers and professional advisersand (c) ESLR1 Sublicensees and TISICS Sublicensees; provided that such employees and consultants,investors, prospective acquirers and professional advisers and ESLR1 Sublicensees and TISICSSublicensees are bound by written agreements or, in the case of professional advisers, ethicalduties respecting such Confidential Information in accordance with the terms of this Section 6.The Receiving Party agrees that it will not allow any unauthorized Person access to suchConfidential Information, and that the Receiving Party will use reasonable measures to protect theconfidentiality of such Confidential Information, including implementing and enforcing proceduresto minimize the possibility of unauthorized use or copying of such Confidential Information. Inthe event that the Receiving Party is required by law to make any disclosure of any of suchConfidential Information, by subpoena, judicial or administrative order or otherwise, the ReceivingParty shall first give written notice of such requirement to the Disclosing Party, and shall permitthe Disclosing Party to intervene in any relevant proceedings to protect its interests in suchConfidential Information, and provide reasonable cooperation and assistance to the Disclosing Partyin seeking to obtain such protection. Notwithstanding the foregoing, ESLR1 and ESLR1 Sublicenseesmay make such disclosures of Technology covered by the TISICS IP specifically concerning SiC Fiberand relating to the PV Field as any of them may deem reasonably necessary for the purpose ofExploiting the SiC Fiber in the PV Field.     6.4 Terms of this Agreement; Publicity. The Parties agree that the terms of thisAgreement shall be treated as Confidential Information of both Parties, and thus may be disclosedonly as permitted by Section 6.3. Notwithstanding the foregoing, TISICS agrees that Evergreen mayfile a copy of this Agreement with the United States Securities and Exchange Commission and othersimilar or comparable governmental bodies, authorities or agencies, if necessary. Subject to theforegoing, neither Party shall make any public announcements relating to the terms, conditions orexistence of this Agreement without the prior written consent of the other Party.     6.5 Return of Confidential Information. The Receiving Party agrees that, upon thetermination of this Agreement, the Receiving Party will immediately return all ConfidentialInformation of the Disclosing Party and any tangible expression thereof (including all copies,summaries and notes of the contents or parts thereof) to the Disclosing Party and no part thereofshall be retained by the Receiving Party in any form and/or for any reason; provided that theReceiving Party may retain one copy of such Confidential Information for archival purposes tosatisfy the Receiving Party’s obligations under any applicable laws. Notwithstanding theforegoing, ESLR1 shall not be obligated to return any Confidential Information of TISICS that is inwhole or in part the subject of the license grant set forth in Section 2.1(a), the license grantedto ESLR1 in the Composite Field License Agreement or the license granted to ESLR1 in the OtherFields License Agreement, in each case, only for so long as such license is effective.7. **Representations and Warranties; Disclaimer of Implied Warranties**.     7.1 Representations and Warranties.
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          (a) *Mutual*. Each Party hereby represents and warrants to the other Party as of the EffectiveDate that:          (i) such Party is a corporation duly organized, validly existing and in good standingunder the laws of the state or jurisdiction in which such Party is incorporated, and suchParty has full right and authority to enter into this Agreement and to grant the licensesand other rights, without payment to a Third Party, granted by such Party as hereindescribed;          (ii) this Agreement has been duly authorized by all requisite corporate action, andwhen executed and delivered will become a valid and binding contract of such Partyenforceable against such Party in accordance with its terms, subject to applicablebankruptcy, insolvency, reorganization, moratorium and other law affecting creditors’ rightsgenerally from time to time if effect, and to general principles of equity;          (iii) the execution, delivery and performance of this Agreement does not conflict withany other agreement, contract, instrument or understanding, oral or written, to which suchParty is a party, or by which it is bound, nor will it violate any Law applicable to suchParty; and          (iv) all necessary consents, approvals and authorizations of all regulatory andgovernmental authorities and other Persons required to be obtained by such Party inconnection with the execution and delivery of this Agreement and the performance of suchParty’s obligations hereunder have been obtained.          (b) *TISICS*. In addition, TISICS hereby represents and warrants to ESLR1 as of the EffectiveDate that:          (i) Exhibit B-1 contains an accurate list of all TISICS IP relevant to SiCFiber manufacturing in the PV Field. Exhibit B-2 contains an accurate list ofTISICS IP relating to SiC Fiber manufacturing for all fields as of the Effective Date(except to the extent already listed on Exhibit B-1). Exhibit B-3 containsa complete and accurate list of (A) all licenses, sublicenses or other agreements underwhich TISICS or its Affiliates has granted rights to others in TISICS IP (“Licenses Out”),(B) all licenses, sublicenses or other agreements under which TISICS or its Affiliates aregranted rights by others in the TISICS IP (“Licenses In”) and (C) any obligations ofexclusivity, covenants not to sue, noncompetition, nonsolicitation, right of first refusal,parity of treatment and/or most favored nation status, or right of first negotiation towhich TISICS or its Affiliates is subject in favor of a Third Party that relate to and/orrestrict any of the TISICS IP.          (ii) Except as set forth in Exhibit E:               (A) with respect to the TISICS IP (1) owned or purported to be owned by TISICSor an Affiliate of TISICS, TISICS or an Affiliate of TISICS exclusively owns suchTISICS IP and, without payment to a Third Party, possesses adequate and enforceablerights in and to such TISICS IP as necessary to Exploit SiC Fiber in the PV Fieldand the Construction and/or Operation of the ESLR1 Facilities, and (2) otherwiseControlled by TISICS or an Affiliate of
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TISICS, TISICS or an Affiliate of TISICS possesses adequate and enforceablerights in and to all such TISICS IP as necessary to Exploit SiC Fiber in the PVField and the Construction and/or Operation of the ESLR1 Facilities; in the case ofthe foregoing clauses (1) and (2) above, free and clear of all Encumbrances;               (B) the TISICS IP constitutes all of the Intellectual Property Rights (1) usedin the designing, manufacturing, selling, distributing and commercializing the SiCFiber in the PV Field and (2) necessary for the Construction and/or Operation of theESLR1 Facilities to manufacture SiC Fiber in the PV Field;               (C) all TISICS IP that has been issued by, or registered, or is the subject ofan application filed with, as applicable, the U.S. Patent and Trademark Office, theU.S. Copyright Office or any similar office or agency anywhere in the world iscurrently in compliance with formal legal requirements (including, as applicable,payment of filing, examination and maintenance fees, inventor declarations, proofsof working or use, timely post-registration filing of affidavits of use andincontestability, and renewal applications), and, to the knowledge of TISICS, allTISICS IP is valid and enforceable;               (D) there are no pending or, to the knowledge of TISICS, threatened claimsagainst TISICS or any of its employees alleging that any practice of the TISICS IPinfringes or violates (or in the past infringed or violated) the rights of othersin, to or under any Intellectual Property Rights (“Third Party IP”) or constitutes amisappropriation of (or in the past constituted a misappropriation of) any subjectmatter of any Intellectual Property Rights of any Person or that any of the TISICSIP is invalid or unenforceable;               (E) to the knowledge of TISICS, the practice of the TISICS IP does not infringeon or violate (and has not in the past infringed on or violated) any Third Party IPor constitute a misappropriation of (and has not in the past constituted amisappropriation of) any subject matter of any Third Party IP;               (F) all former and current employees, consultants and contractors of TISICS andits Affiliates have executed written instruments with TISICS or its Affiliates, asapplicable, that assign to TISICS or its Affiliates all right, title and interest inand to any and all TISICS IP and all Technology embodying the TISICS IP;               (G) to the knowledge of TISICS, there is no, nor has there been any,infringement or violation by any Person of any TISICS IP or the TISICS’ or itsAffiliates rights therein or thereto, and there is no, nor has there been any,misappropriation by any Person of any of the TISICS IP or the subject matterthereof; and
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               (H) TISICS and its Affiliates has taken reasonable security measures to protectthe secrecy, confidentiality and value of all trade secrets contained in the TISICSIP.     7.2 Disclaimer of Implied Warranties. EXCEPT AS EXPRESSLY SET FORTH HEREIN, NEITHERTISICS NOR ESLR1 MAKES ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTYOF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE OR NON-INFRINGEMENT.     7.3 Without limiting Section 9, for the avoidance of doubt, any warranty given in Section 7.1in relation to TISICS IP excludes any TISICS IP that is not Controlled by TISICS or any of itsAffiliates as of the Effective Date.8. **LIMITATION OF LIABILITY**.     8.1 EXCEPT FOR ANY LIABILITY ARISING FROM (A) A BREACH BY TISICS OR ITS AFFILIATES OF THEEXCLUSIVE NATURE OF THE LICENSE GRANTED TO ESLR1 IN SECTION 2.1(a) OR ANY OTHER EXCLUSIVITYPROVISIONS SET FORTH HEREIN, (B) A BREACH BY A PARTY OF ITS CONFIDENTIALITY OBLIGATIONS UNDERSECTION 6 (C) TISICS’ INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTION 9, AND/OR (D) A BREACH BYESLR1 OR ITS AFFILIATES OF SECTION 2.1 IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTYFOR ANY SPECIAL, INCIDENTAL, INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES (INCLUDING ANYDAMAGES RESULTING FROM LOSS OF USE, LOSS OF DATA, LOSS OF PROFITS OR LOSS OF BUSINESS) ARISING INANY WAY UNDER THIS AGREEMENT AND UNDER ANY THEORY OF LIABILITY (INCLUDING BREACH OF CONTRACT,STRICT LIABILITY, NEGLIGENCE, OR OTHER TORT), EVEN IF SUCH PARTY IS INFORMED IN ADVANCE OF THEPOSSIBILITY OF SUCH DAMAGES.     8.2 EXCEPT FOR ANY LIABILITY ARISING FROM (A) A BREACH BY TISICS OR ITS AFFILIATES OF THEEXCLUSIVE NATURE OF THE LICENSE GRANTED TO ESLR1 IN SECTION 2.1(a) OR ANY OTHER EXCLUSIVITYPROVISIONS SET FORTH HEREIN, (B) A BREACH BY A PARTY OF ITS CONFIDENTIALITY OBLIGATIONS UNDERSECTION 6 (C) TISICS’ INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTION 9 AND/OR (D) A BREACH BYESLR1 OR ITS AFFILIATES OF SECTION 2.1, EACH PARTY’S CUMULATIVE LIABILITY TO THE OTHER PARTY OR ANYTHIRD PARTY IN CONTRACT, TORT (INCLUDING NEGLIGENCE) OR BREACH OF STATUTORY DUTY, OR OTHERWISE, FORANY LOSS OR DAMAGES RESULTING FROM ANY CLAIMS, DEMANDS, OR ACTIONS ARISING OUT OF OR RELATING TOTHIS AGREEMENT, SHALL NOT EXCEED IN THE AGGREGATE THE GREATER OF (I) [****] OR (II) THE AGGREGATE AMOUNT OF PV ROYALTIES, CONDITIONAL FEES, PV SHARED EXCESSFEES AND OTHER AMOUNTS PAID OR PAYABLE BY ESLR1 TO TISICS HEREUNDER.9. **Indemnification****.**
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     9.1 TISICS Indemnity. TISICS on its own behalf and on behalf of its successors,executors, administrators, estate, heirs and assigns, hereby agrees to indemnify, defend and holdESLR1 and ESLR1 Sublicensees, and each of their Affiliates and direct and indirect partners andmembers, stockholders, directors, officers, employees and agents and each person who controls anyof them within the meaning of Section 15 of the Securities Act or 1933, as amended, or Section 20of the Exchange Act of 1934, as amended, (each a “ESLR1 Indemnitee,” and collectively, the “ESLR1Indemnitees”) harmless from and against all claims, liabilities, threatened claims, damages,expenses (including reasonable attorneys’ fees), suits, proceedings, losses or judgments, whetherfor money or equitable relief, of any kind (collectively, “Losses,” and, each a “Loss”), arisingfrom (i) any claim that the exercise by any of the ESLR1 Indemnitees of any rights under the TISICSIP (excluding Joint IP) granted herein infringes on, constitutes a misappropriation of the subjectmatter of, or otherwise violates any Third Party IP, (ii) any breach or alleged breach of any ofthe representations or warranties of TISICS set forth in Section 7 or (iii) the gross negligence,recklessness or willful misconduct of TISICS or any of its Affiliates or TISICS Sublicensees.     9.2 ESLR1 Indemnity. ESLR1 on its own behalf and on behalf of its successors,executors, administrators, estate, heirs and assigns, hereby agrees to indemnify, defend and holdTISICS, and each of its Affiliates and direct and indirect partners and members, stockholders,directors, officers, employees and agents and each person who controls any of them within themeaning of Section 15 of the Securities Act or 1933, as amended, or Section 20 of the Exchange Actof 1934, as amended, (each a “TISICS Indemnitee,” and collectively, the “TISICS Indemnitees”)harmless from and against all Losses, arising from (i) any Third Party claim that any use of anyTechnology embodying the TISICS IP (excluding Joint IP) not in accordance with this Agreement oralteration of any such Technology, in each case, by any of ESLR1 or ESLR1 Sublicensees infringeson, constitutes a misappropriation of the subject matter of, or otherwise violates any Third PartyIP, solely to the extent that such Loss would not have arisen but for such alteration or improperor unauthorized use, (ii) any breach or alleged breach of any of the representations or warrantiesof ESLR1 set forth in Section 7 or (iii) the gross negligence, recklessness or willful misconductof ESLR1 or ESLR1 Sublicensees.     9.3 The ESLR1 Indemnitees and the TISICS Indemnitees are together referred to in the remainderof this section 9 as “the Indemnitees” and ESLR1 and TISICS each as an “Indemnifying Party” as thecontext requires.     9.4 Notice of Loss. An Indemnitee shall give the Indemnifying Party notice of anymatter which an Indemnitee has determined has given or could give rise to a right ofindemnification under this Agreement, within 60 days of such determination, stating the amount ofthe Loss, if known, and method of computation thereof, and containing a reference to the provisionsof this Agreement in respect of which such right of indemnification is claimed or arises.     9.5 Third Party Claims. If an Indemnitee shall receive notice of any action, audit,demand or assessment (each, a “Third Party Claim”) against it or which may give rise to a claim forLoss under this Section 9, within [****] days of the receipt of such notice, the Indemnitee shallgive the Indemnifying Party notice of such Third Party Claim; provided, however, that the failureto provide such notice shall not release the Indemnifying Party from any of its obligations
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under this Section 9 except to the extent that the Indemnifying Party is materially prejudicedby such failure. Subject to the following sentence, the Indemnifying Party may assume control ofthe defense of any Third Party Claim provided that (i) the Indemnifying Party shall (within [****]business days of notice from Indemnitee) deliver to the Indemnitee an unconditional writtenagreement to defend, and satisfy if the defense is unsuccessful, such Third Party Claim at theIndemnifying Party’s sole cost and expense and (ii) the Indemnifying Party provides adequateassurances that it is financially capable for providing indemnification for such Third Party Claim;provided, however, in any defense assumed by it, the Indemnifying Party will promptly engagequalified reputable attorneys, who shall be subject to the reasonable approval of the Indemnitee;and provided, further, if at any time the Indemnitee determines that it is in its best interests toassume and control the defense of such Third Party Claim, the Indemnitee shall be entitled toassume and control such defense (without limiting the Indemnifying Party’s other indemnificationobligations hereunder). Notwithstanding the foregoing, if there exists a conflict of interest thatwould make it inappropriate for the same counsel to represent both the Indemnitee and theIndemnifying Party as determined in the reasonable judgment of the Indemnitee, then the Indemniteeshall be entitled to retain its own counsel in each jurisdiction for which the Indemniteedetermines counsel is required, at the expense of the Indemnifying Party. In the event that theIndemnifying Party exercises the right to undertake any such defense against any such Third PartyClaim as provided above, the Indemnitee shall cooperate with the Indemnifying Party in such defenseand make available to the Indemnifying Party, at the Indemnifying Party’s expense, all witnesses,pertinent records, materials and information in the Indemnitee’s possession or under theIndemnitee’s control relating thereto as is reasonably required by the Indemnifying Party.Similarly, in the event the Indemnitee is, directly or indirectly, conducting the defense againstany such Third Party Claim, the Indemnifying Party shall cooperate with the Indemnitee in suchdefense and make available to the Indemnitee, at the Indemnifying Party’s expense, all suchwitnesses, records, materials and information in its possession or under its control relatingthereto as is reasonably required by the Indemnitee. No such Third Party Claim may be settled bythe Indemnifying Party without the prior written consent of the Indemnitee unless the settlementcontains a full and complete release of the Indemnitee and does not impose any equitable relief orany other restriction or condition on any of them.     9.6 Indemnification Procedure. If (and to the extent) an Indemnifying Party isresponsible pursuant hereto to indemnify an Indemnitee in respect to Third Party Claims, thenwithin ten days after the occurrence of a final determination, finding, order, and/or judgment (a“Final Determination”) (or sooner if required by such determination), the Indemnifying Party shallpay the Indemnitee , in immediately available funds denominated in US Dollars, the amount of anyLosses (or such portion thereof as the Indemnifying Party shall be responsible for pursuant to theprovisions hereof). In the event that any Losses incurred by the Indemnitee do not involve paymentby the Indemnitee of a Third Party claim, then, if (and to the extent) the Indemnifying Party isresponsible pursuant hereto to indemnify the Indemnitee against such Losses, the Indemnifying Partyshall within ten days after agreement on the amount of the Losses, or the occurrence of a FinalDetermination of such amount, pay to the Indemnitee, in immediately available funds the amount ofsuch Losses (or such portion thereof as the Indemnifying Party shall be responsible for pursuant tothe provisions hereof).
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     9.7 Cost Offsets. Each of ESLR1 or TISICS as an Indemnitee shall have the right toreduce any payments owed by it to the other under any written agreement between ESLR1 and TISICS bythe amount of any indemnifiable Losses suffered by any such Indemnitee (including investigation,defense, settlement or judgment satisfaction and all professional fees).10. **Term; Termination****.**     10.1 Term. This Agreement shall commence as of the Effective Date and, unless soonerterminated in accordance with the terms hereof or by mutual written consent, shall continue untilthe later of the end of Period 6 or [****] (as defined in Exhibit D) (the “Term”).     10.2 Termination.          (a) *Termination*. In addition to any other termination rights provided for in this Agreement,either Party may terminate this Agreement immediately upon written notice to the other Party in theevent of a material breach of this Agreement by the other Party if such breach is incapable of cureor the breaching Party otherwise fails to cure such breach within [****] days following notice ofsuch breach from the non-breaching Party.          (b) *Abandonment*. In the event an Abandonment of Construction of ESLR1 Facilities (as definedbelow) occurs prior to the completion of the initial construction of manufacturing facilities forthe Exploitation of SiC Fiber owned or controlled by ESLR1, TISICS may terminate this Agreementimmediately upon written notice to ESLR1. “Abandonment of Construction of ESLR1 Facilities” meansESLR1’s failure, manifested over a period of [****] or more consecutive days during the Term, touse reasonable efforts to perform activities relating to the design, construction and/ordevelopment of manufacturing facilities for the Exploitation of SiC Fiber, excluding any failuredue to (i) a breach by TISICS of its obligations under this Agreement or the Facilities and StartUp Agreement or (ii) causes beyond ESLR1’s reasonable control, such as any of the following events(each, a “Force Majeure Event”): (A) any fire, explosion, unusually severe weather, naturaldisaster or Act of God; (B) epidemic; any nuclear, biological, chemical, or similar attack; anyother public health or safety emergency; any act of terrorism; and any action reasonably taken inresponse to any of the foregoing; (C) any act of declared or undeclared war or of a public enemy,or any riot or insurrection; (D) damage to machinery or equipment; any disruption intransportation, communications, electric power or other utilities, or other vital infrastructure;or any means of disrupting or damaging internet or other computer networks or facilities; (E) anystrike, lockout or other labor dispute or action; or (F) any action taken in response to any of theforegoing events by any civil or military authority. In the event that ESLR1 ceases to manufactureSiC Fiber for use within the PV Field for more than a period of [****] consecutive months followingcompletion of the initial construction of the SiC Facilities, TISICS may terminate this Agreementimmediately upon written notice to ESLR1, except if such cessation is due to (1) a breach by TISICSof its obligations under this Agreement or the Facilities and Start Up Agreement or (2) causesbeyond ESLR1’s reasonable control, such as a Force Majeure Event.     10.3 Termination Damages. Without prejudice to any other remedies either Party mayexpressly have hereunder in respect of any breach of this Agreement, neither Party shall be liable
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to the other for damages by solely reason of the termination or cancellation of this Agreementin accordance with the provisions set forth above.     10.4 Continuing Obligations. The following shall survive the expiration ortermination hereof: (i) the obligation of ESLR1 to pay any accrued, but unpaid, payments due toTISICS hereunder (subject to Section 4.4), (ii) the obligation of TISICS to pay any accrued, butunpaid, taxes, duties, and other levies (if any) applied by any government authority on paymentsmade by ESLR1 to TISICS hereunder (in accordance with Section 4.3(a)), and (iii) the provisions ofthis Section 10.4, Sections 1 (and any other definitions contained herein), 2.1, 2.2, 2.3, 2.4,2.5, 2.6, 3.1(b), 3.1(e), 3.3, 3.4, 4.2(c), 4.3, 4.4, 5, 6, 7, 8, 9, 10.3, 10.5 and 11 and the lastsentence of Section 3.1, provided that, subject to Section 4.4, if TISICS terminates this Agreementfor Abandonment of Construction of ESLR1 Facilities, the provisions of Section 2.1 shall notsurvive such termination except as otherwise set forth in Section 10.5.     10.5 Inventory Sell-Down Period. Without limiting Section 4.4, upon any terminationof this Agreement pursuant to Section 10.2(b), ESLR1 may continue to distribute its then-currentinventory of SiC Fiber and manufacture and distribute any inventory of SiC Fiber for ordersthen-confirmed by ESLR1. During this period, the provisions of this Agreement shall continue inforce to the extent required for the limited purpose of permitting ESLR1 to distribute itsinventory of SiC Fiber in accordance with the foregoing.11. **Miscellaneous.**     11.1 Fees and Expenses. The Parties shall pay all of their own costs, fees andexpenses incurred in connection with this Agreement and the consummation (or the preparation forthe consummation) of the transactions contemplated hereby (including fees and expenses of legalcounsel, accountants and other representatives and consultants and advisors and due diligence(including travel-related) costs, fees and expenses).     11.2 Remedies. Each Party acknowledges and agrees that the other Party would bedamaged irreparably in the event any of the provisions of this Agreement are not performed inaccordance with their specific terms or otherwise are breached. Accordingly, each Party agreesthat the other Party shall be entitled to an injunction or injunctions to prevent breaches of theprovisions of this Agreement and to enforce specifically this Agreement and the terms andprovisions hereof in any action instituted in any court of the United States or any state thereofhaving jurisdiction over the Parties and the matter.     11.3 Consent to Amendments. This Agreement may be amended, or any provision of thisAgreement may be waived; providedthat any such amendment or waiver shall bebinding upon each Party only if agreed by each party and with the terms of such agreement set forthin writing executed by each Party and referring specifically to the provision alleged to have beenamended or waived. No course of dealing between or among the Parties shall be deemed effective tomodify, amend or discharge any part of this Agreement or any rights or obligations of any Partyunder or by reason of this Agreement.     11.4 Relationship of Parties. The relationship of ESLR1 and TISICS created under thisAgreement shall be that of independent contractors. Nothing in this Agreement shall be
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construed to place the Parties hereto in an agency, employment, franchise, joint venture, orpartnership relationship. Neither Party shall have the authority to obligate or bind the other inany manner with respect to the transaction contemplated by this Agreement, and nothing hereincontained shall give rise or is intended to give rise to any rights of any kind to any ThirdParties. Neither Party will represent to the contrary, either expressly, implicitly or otherwise.     11.5 Notices. All notices, demands or other communications to be given or deliveredunder or by reason of the provisions of this Agreement shall be in writing and shall be deemed tohave been given when delivered personally to the recipient, three (3) days after being sent to therecipient by reputable overnight courier service (charges prepaid), upon machine-generatedacknowledgment of receipt after transmittal by facsimile or seven (7) days after being mailed tothe recipient by certified or registered mail, return receipt requested and postage prepaid. Suchnotices, demands and other communications shall be sent to the Parties at the addresses indicatedbelow or to such other address or to the attention of such other person as the recipient Party hasspecified by prior written notice to the sending Party.to:ESLR1:138 Bartlett Street