EX-10.27.2 First Amendment to the Distributorship



 





Exhibit 10.27.2




DATED 30, August 2005




CALDER AG




-and-




DESALCO LIMITED




-and-




DWEER TECHNOLOGY LTD.




 




 




 



 




First Amendment to the

Distributorship Agreement

relating to

DWEER Products

dated 26 February 2004



 




 




 




 









     Cayman Islands













 





THIS FIRST AMENDMENT is made on 30, August 2005




BETWEEN:





	(1)	 	Calder AG, a Swiss company, the registered office of which is Binzenholzstrasse 447,
Industrie Nord, Ch-5704 Egliswil, Switzerland (hereinafter “Calder”); and






	(2)	 	DesalCo Limited, a Cayman Islands company, the registered office of which is Trafalgar Place,
1428A West Bay Road, Grand Cayman, Cayman Islands (hereinafter “DesalCo”); and






	(3)	 	DWEER Technology Ltd., a Cayman Islands exempted company, the registered office of which is
c/o Campbell Corporate Services Limited, 4th Floor, Scotiabank Building, P.O. Box
268GT, Grand Cayman, Cayman Islands (hereinafter “DWEER-Tech”).





WHEREAS:





	(A)	 	Calder and DesalCo entered into a Distributorship Agreement relating to DWEER Products dated
26 February 2004 pursuant to which Calder appointed DesalCo as its exclusive distributor for
Products in the Territory (both terms as defined in the aforesaid Distributorship Agreement)
and gave DesalCo the exclusive right to sell and distribute the Products in the Territory.






	(B)	 	Calder and DesalCo now wish to the amend the Distributorship Agreement to allow DesalCo to
manufacture and sell certain Third-party Components (as defined below) for use in connection
with Legacy Products (as defined below) installed for use in the Territory.






	(C)	 	DWEER-Tech and DesalCo entered into an Amended and Restated Agreement for the sale of the
business of designing, developing, manufacturing, marketing and selling DWEER Products and the
patents, patent applications and other intellectual property relating to DWEER Products and
Associated Technology dated 24 September 2004 (the “Technology Sale Agreement”) pursuant to
which DWEER-Tech acquired the entire business of designing, developing, manufacturing,
marketing and selling the Products and the Assets (as defined therein), including DWEER units
and all rights and intellectual property in relation to the same and DesalCo ceased to carry
on such business. In the Technology Sale Agreement, DesalCo agreed, inter alia, not to carry
on or be engaged, directly or indirectly, in any
business which is the same as, similar to, or which competes with the Business (as
defined therein) or to use or infringe the Intellectual Property (as defined therein);














 












	(D)	 	DWEER-Tech has granted Calder all rights to sub-licence the DWEER Intellectual Property that
are necessary to enable Calder to grant to DesalCo the right to manufacture or procure the
manufacture of Third-party Components for use only in connection with the Legacy Products
during the term of the Calder Distributorship Agreement.






	(E)	 	DWEER-Tech is party to this Agreement for the purposes of consenting to and agreeing that
DesalCo may, notwithstanding the provisions of the Technology Sale Agreement, during the term
of the Distributorship Agreement, manufacture or procure the manufacture of Legacy Products.





NOW IT IS HEREBY AGREED as follows:-





	1.	 	INTERPRETATION






	 	1.1	 	In this Amendment, save where otherwise provided or where the context otherwise
requires or admits, terms and expressions defined in the Distributorship Agreement
shall have the same meaning when used herein and the following terms and expressions
shall have the meaning set out below:





	 	 	 
	“Distributorship

Agreement”
	 	means the Distributorship Agreement relating to DWEER Products dated 26
February 2004 between Calder and DesalCo mentioned in the recitals hereto;








	 	1.2	 	In this Amendment, save where otherwise provided or where the context otherwise
requires or admits:






	 	(a)	 	references to any law or provision of law shall include a
reference to any law or provision of any law which amends or replaces, or has
amended or replaced, it;
	 
	 	(b)	 	references to this Amendment or any other agreement or document
shall be construed as a reference to this Amendment as the same may from time
to time be amended, varied or supplemented;




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	 	(c)	 	a “clause” or “schedule” is a reference to a clause hereof or
schedule hereto;
	 
	 	(d)	 	a “sub-clause” is a reference to a sub-clause of the clause in
which the reference appears;
	 
	 	(e)	 	any word, term or expression (including defined terms and
expressions) that imports any gender shall include all genders and words and
terms (including defined terms and expressions) importing the singular shall
include the plural and vice versa.






	 	1.3	 	In this Amendment the headings are inserted for convenience only and shall not
affect the construction hereof.






	2.	 	Amendment
	 
	 	 	The Distributorship Agreement is hereby amended as follows:-






	 	2.1	 	By adding the following paragraphs to the interpretation clause 1.1 in
alphabetical order:





	 	 	 
	“Improvements”
	 	all improvements, modifications or
adaptations to any part of the Technical
Information which might reasonably be of
commercial interest to Calder or
DWEER-Tech in the design, manufacture,
assembly, use or supply of the Legacy
Products and which may be made or acquired
by DesalCo during the term of this
Agreement;

	“Legacy Products”
	 	means the work-exchanger (also called
pressure-exchanger) energy-recovery
systems, components and sub-components
thereof used for water desalination using
the reverse osmosis process designed by
DesalCo or DWEER-Tech and installed in the
Territory as of the date of this
Agreement;







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	“Technical Information”
	 	identifiable technical and commercial
information, know-how, experience,
manufacturing techniques, engineering
data, specifications of materials and
other technical or commercial information
in the possession of Calder relating to or
in respect of or for use with the Legacy
Products or Products; whether stored
electronically or otherwise, including
without limitation Improvements;

	“Third-party Components”
	 	means all parts comprised within the 

Legacy Products excluding the following:








	 	(a)	 	All parts made from castings;
	 
	 	(b)	 	Vessel pistons;
	 
	 	(c)	 	Check Valves; and
	 
	 	(d)	 	pressure vessels manufactured of
Duplex Stainless Steels whether or not the
pressure vessels they replace are
manufactured of Duplex Stainless Steels.






	 	2.2	 	By amending clause 2.3(c) to read as follows:






	 	(c)	 	except as permitted pursuant to Clause 5.10 below, not be
concerned or interested, either directly or indirectly, in the design,
manufacture, distribution, marketing or sale of any goods which compete with
the Products;






	 	2.3	 	By adding the following clauses after Clause 5.9:






	 	5.10	 	During the term of this Agreement, DesalCo may manufacture or
procure the manufacture of and sell Third-party Components for use only in
connection with the Legacy Products.
	 
	 	5.11	 	Calder may, without accepting any obligation or in any way
committing to do so and provided that DesalCo reimburses Calder its direct
costs in connection therewith, supply DesalCo with Technical Information for
Third-party Components that it has in its possession or readily available in
order to assist DesalCo to manufacture or procure the manufacture of
Third-party Components in accordance with this Agreement, to the
extent that Calder is not under any restriction from supplying such
Technical Information.




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	 	5.12	 	Calder and DWEER-Tech shall not have any liability or
responsibility in relation to Third-party Components which DesalCo manufactures
or procures the manufacture of or sells, including any consequential losses
arising therefrom.
	 
	 	5.13	 	DesalCo shall not apply the Trade Marks to Third-party
Components which DesalCo manufactures or procures the manufacture of and
DesalCo shall not represent to anyone that Third-party Components which DesalCo
manufactures or procures the manufacture of are supplied by or guaranteed by
Calder or DWEER-Tech or that Calder or DWEER-Tech have any liability or
responsibility therefor.
	 
	 	5.14	 	DesalCo agrees to maintain secret and confidential all
Technical Information obtained from Calder or DWEER-Tech both pursuant to this
Agreement and prior to and in contemplation of it and all other information
that it may acquire from the Calder or DWEER-Tech in the course of this
Agreement, to use the same exclusively for the purposes of this Agreement, and
to disclose the same only to those of its employees, and Third-party Components
manufacturers or suppliers pursuant to this Agreement (if any) to whom and to
the extent that such disclosure is reasonably necessary for the purposes of
this Agreement.
	 
	 	5.15	 	The foregoing obligations of clause 5.14 above shall not apply
to Technical Information or other information which:






	 	5.15.1	 	Prior to receipt thereof from Calder or DWEER-Tech was in the
possession of DesalCo and at its free disposal provided that the
same can reasonably be shown to be the case from records within
the possession or control of DesalCo;
	 
	 	5.15.2	 	is subsequently disclosed to DesalCo without any obligations
of confidence by a third party who has not derived it directly
or indirectly from Calder or DWEER-Tech; or




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	 	5.15.3	 	is or becomes generally available to the public in the
Territory through no act or default of DesalCo or its agents or
employees.






	 	5.16	 	Notwithstanding the foregoing, DesalCo shall be entitled to
disclose Technical Information to actual customers or operators of Legacy
Products insofar as such disclosure is reasonably necessary for the use of the
Legacy Products.
	 
	 	5.17	 	DesalCo shall procure that all its employees and Third-party
Component manufacturers or suppliers pursuant to this Agreement (if any) who
have access to any information to which the obligations of clause 5.14 apply
shall be made aware of these obligations and shall further procure that so far
as is reasonably practicable all of such employees and Third-party Components
manufacturers or suppliers shall enter into written undertakings in favour of
Calder to this end in a form previously approved by Calder.
	 
	 	5.18	 	DesalCo shall forthwith disclose to Calder and DWEER-Tech in
confidence and in such detail as Calder or DWEER-Tech may reasonably require
all Improvements that it may develop or acquire during the term of this
Agreement except in so far as such disclosure would disclose information
derived from and subject to confidentiality obligations in favour of a third
party.
	 
	 	5.19	 	Improvements shall be deemed to be part of the Technical
Information for the purposes of this Agreement.
	 
	 	5.20	 	All Improvements shall be the exclusive property of DWEER-Tech
including all Improvements DesalCo is obliged to disclose to Calder and
DWEER-Tech under clause 5.18 hereof and all intellectual property rights in
respect thereof or arising therefrom shall belong to DWEER-Tech exclusively and
DesalCo undertakes to assign and transfer or procure the assignment and
transfer of all intellectual property rights in respect thereof or arising
therefrom to DWEER-Tech forthwith on request. Improvements (whether or not
patentable, protected by copyright or otherwise protected) may be used by
DWEER-Tech and/or
its licensees in any manner including in connection with Products or
Legacy Products.




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	 	5.21	 	Pending any assignment under clause 5.20, DWEER-Tech shall have
a non-exclusive irrevocable world-wide royalty-free licence without limit of
time with the right to assign and to grant sub-licences thereunder to use all
Improvements DesalCo is required to disclose to Calder and DWEER-Tech under
clause 5.18 above and to use and exploit all intellectual property rights in
respect thereof owned by DesalCo or any assign or successor in title of
DesalCo.
	 
	 	5.22	 	Where DesalCo has developed or acquired an Improvement it shall
not publish the same or do anything that might prejudice the validity of any
patent that might subsequently be granted on it until DWEER-Tech has had at
least 60 working days from disclosure in writing of all information relating to
it to consider whether patent or other protection should be applied for.
DWEER-Tech shall not publish the same or do anything that might prejudice the
validity of any patent that might subsequently be granted on it until an
application for a patent has been filed by either DWEER-Tech or DesalCo in
accordance with this clause or until it is clear that neither party intends to
so file and within such 60 day period shall notify DesalCo whether it intends
to seek any relevant protection. If so, then this obligation shall continue
for such time as may be reasonably required to prepare and file an application
for patent or other protection. If DWEER-Tech does not within such 60 day
period notify DesalCo that it intends to seek any relevant protection, and if
it is agreed with DWEER-Tech that DesalCo may do so (which agreement DWEER-Tech
may withhold in its sole and absolute discretion), DesalCo may seek patent or
other protection (and DesalCo shall within such 60 day period give DWEER-Tech
notice that it wishes to seek patent or other protection), in which event
DWEER-Tech will be subject to the same obligation not to publish the same or do
anything that might prejudice the validity of any patent that might
subsequently be granted on it for such time as may be reasonably required for
DesalCo to prepare and file an application for patent or other protection.




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	 	5.23	 	Subject to the foregoing each party shall be free to apply for
patent protection for any invention not made in whole or in part by an employee
of the others provided however that the specification in support thereof does
not disclose any Technical Information or other information which is
confidential to the others.






	 	2.4	 	By amending clause 6.1 to read as follows:






	 	6.1	 	Except as provided by clauses 5.14 to 5.17 (inclusive) above
and clauses 6.3 and 6.4 below, DesalCo and any Affiliate thereof shall at all
times during the continuance of this Agreement and thereafter:






	 	(a)	 	use its best endeavours to keep all
Restricted Information (as defined below) confidential and
accordingly shall not disclose any Restricted Information to any
other person; and
	 
	 	(b)	 	not use any Restricted Information for any
purpose other than the performance of its obligations under this
Agreement or any other agreement for the sale of the Products.






	3.	 	RESTATEMENT OF THE DISTRIBUTORSHIP AGREEMENT
	 
	 	 	DesalCo and Calder agree that following execution of this First Amendment, they shall
execute, in duplicate, a document in the form of the Amended and Restated Distributorship
Agreement attached as Schedule 1 to this Agreement incorporating the amendments to the
Distributorship Agreement agreed pursuant to this First Amendment and that, henceforth, the
provisions of the Amended and Restated Distributorship Agreement shall govern and apply
wherever the provisions of thereof differ in any way from the provisions of the
Distributorship Agreement. Save as expressly varied by the provisions of this First
Amendment, the Distributorship Agreement shall continue in full force and effect.
	 
	4.	 	TECHNOLOGY SALE AGREEMENT






	 	4.1	 	DWEER-Tech consents to and agrees that DesalCo may, during the term of the
Distributorship Agreement, manufacture or procure the manufacture of and sell
Third-party Components for use only in connection with the Legacy Products subject to
and in accordance with the terms of the Distributorship Agreement as




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	 	 	 	amended hereby notwithstanding the provisions of the Technology Sale Agreement, and
any provisions of the Technology Sale Agreement prohibiting the same are hereby
suspended for the term of the Distributorship Agreement. Such suspension shall be
without prejudice to the remaining provisions of the Technology Sale Agreement which
shall continue in full force and effect without any variation or amendment thereto
and, furthermore, upon the termination of the Distributorship Agreement, the
provisions of the Technology Sale Agreement that are hereby suspended shall revive
and apply as if this Agreement had not been entered into.
	 
	 	4.2	 	In consideration of DWEER-Tech’s consent and agreement as set out in the
immediately preceding clause, the parties hereto agree that the covenants and
agreements contained in clauses 2.3 and 5.14 to 5.19 (inclusive) of the Distributorship
Agreement as amended by this Agreement may be directly enforced by DWEER-Tech and its
successors and assigns.






	5.	 	MISCELLANEOUS PROVISIONS






	 	5.1	 	Nothing in this Amendment shall create or be deemed to create a partnership or
relationship of principal and agent or employer and employee between the parties.
	 
	 	5.2	 	This Amendment together with the Distributorship Agreement, and the Technology
Sale Agreement contain the entire agreement between the parties with respect to the
subject matter hereof, supersede all previous agreements and understandings between the
parties with respect hereto, and may not be modified except by an instrument in writing
signed by the duly authorised representatives of the parties.
	 
	 	5.3	 	Each party acknowledges that in entering into this Amendment it does not do so
on the basis of, and does not rely on, any representation, warranty or other provision
except as expressly provided herein, and all conditions, warranties, or other terms
implied by statute or common law are hereby excluded to the fullest extent permitted by
law.










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	 	5.4	 	If any provision of this Amendment or any agreement entered into pursuant
hereto is or becomes illegal, invalid or unenforceable in any jurisdiction, that shall
not affect:-






	 	(a)	 	the validity or enforceability in that jurisdiction of any
other provision of this Amendment or such other agreement; or
	 
	 	(b)	 	the validity or enforceability in other jurisdictions of that
or any other provision of this Amendment or such other agreement.






	 	5.5	 	DesalCo agrees to pay DWEER-Tech’s and Calder’s reasonable legal fees and
disbursements in connection with this First Amendment to the Distributorship Agreement
and the preparation thereof and all consequential amendments required to the Technology
Licence to permit and enable this First Amendment to the Distributorship
Agreement.






	6.	 	JURISDICTION
	 
	 	 	This Amendment shall be governed by and construed in all respects in accordance with the
laws of the Cayman Islands and each party hereby submits to the non-exclusive jurisdiction
of the Cayman Islands Courts.
	 
	7.	 	NOTICES
	 
	 	 	All notices or other communications required or permitted to be given hereunder shall be in
writing and shall be served by delivering the same by hand or by sending the same by
facsimile or reputable courier service and shall be deemed given, if sent by hand, when
delivered, if sent by facsimile, upon the date stated in the transmission report or, if sent
by courier service, on delivery by the relevant courier service, in each case, to the
address set out below or such other address as is notified by the relevant person from time
to time, provided that a notice given in accordance with the above but received on a
non-working day or after business hours in the place of receipt shall only be deemed to be
given on the next working day in that place:






	 	7.1	 	if to Calder:


Binzenholzstrasse 447, Industrie Nord

CH-5704 Egliswil

Switzerland

Attention: President

Facsimile No:+(41) 62 769 60 70






	 	7.2	 	if to DesalCo:

	 
	 	 	 	Trafalgar Place

1428A West Bay Road

Grand Cayman, Cayman Islands

Attention: President

Facsimile No:+1 (345) 949-2957








	 	7.3	 	if to DWEER-Tech:

	 
	 	 	 	48 Par-la-Ville Road, Suite 1231

Hamilton HM 11, Bermuda

Facsimile No:+1 (441) 292-2024






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Schedule 1




Amended and Restated Distributorship Agreement




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AS WITNESS whereof the parties have hereto set their hands the day and year first before written.





	 	 	 	 	 	 	 
	SIGNED FOR AND ON BEHALF OF

	 	 	)	 	 	 
	DESALCO LIMITED by

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	in the presence of:

	 	 	)	 	 	/s/ Frederick W. McTaggart
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Frederick W. McTaggart, Director
	 
	 	 	 	 	 	 
	/s/ Kenneth Crowley               
	 	 	 	 	 	 
	Witness
	 	 	 	 	 	 
	Witness name: Kenneth Crowley
	 	 	 	 	 	 
	Address: P.O. Box 114GT Grand Cayman
	 	 	 	 	 	 
	Occupation: Engineer
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	SIGNED FOR AND ON BEHALF OF

	 	 	)	 	 	 
	CALDER AG by

	 	 	)	 	 	 
	Ernst Kündig, Director and President

	 	 	)	 	 	 
	in the presence of:

	 	 	)	 	 	/s/ Ernst Kündig
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Ernst Kündig, Director and President
	 
	 	 	 	 	 	 
	Tanja Keses                    
	 	 	 	 	 	 
	Witness
	 	 	 	 	 	 
	Witness name: Tanja Keses
	 	 	 	 	 	 
	Address: Weihesweg AG, CH-550R Hunzehschwil
	 	 	 	 	 	 
	Occupation: Company Secretary
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	SIGNED FOR AND ON BEHALF OF

	 	 	)	 	 	 
	DWEER
TECHNOLOGY LTD. by

	 	 	)	 	 	 
	Dr.
William T. Andrews, Managing Director

	 	 	)	 	 	 
	in the presence of:

	 	 	)	 	 	/s/ Dr.
William T. Andrews
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Dr.
William T. Andrews, Managing Director
	 
	 	 	 	 	 	 
	Derek
Woolley                    
	 	 	 	 	 	 
	Witness
	 	 	 	 	 	 
	Witness name: Derek
Woolley
	 	 	 	 	 	 
	Address:
9 Happy Talk Drive
                  Paget Bermuda
	 	 	 	 	 	 
	Occupation:
Engineer
	 	 	 	 	 	 










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