EX-10.27.3 Amended and Restated Distributorship Ag



 





Exhibit 10.27.3




Amended and Restated as at

 30, August 2005




DATED February 26, 2004




CALDER AG




-and-




DESALCO LIMITED




 




 




 




 





Distributorship Agreement

relating to

DWEER Products




 





 




 




 




 




 




 




 










 









 








THIS
DISTRIBUTORSHIP AGREEMENT is made on February 26, 2004

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 duly incorporated in the Cayman Islands, the
registered office of which is Trafalgar Place, 1428A West Bay Road, Grand Cayman, Cayman
Islands (hereinafter “DesalCo”).





WHEREAS:





	(A)	 	Pursuant to and upon the terms of a Distributorship Agreement dated 24 September 2002 between
DWEER Technology Ltd., a Cayman Islands company (“DWEER-Tech”) and DesalCo (the “ Original
Distributorship Agreement”), DWEER-Tech appointed DesalCo as its exclusive distributor for
Products in the Territory (both terms as defined in this Agreement) and gave DesalCo the
exclusive right to sell and distribute the Products in the Territory.






	(B)	 	Pursuant to and upon the terms of a Technology Licence relating to the manufacturing,
marketing and sale of DWEER and LinX products, work exchangers and related products dated 30
April 2003 between DWEER-Tech and Calder (“the Technology Licence”) DWEER-Tech granted Calder
the exclusive right to, inter alia, design, manufacture and sell, inter alia, the Products
worldwide, excluding the rights granted to DesalCo under the Original Distributorship
Agreement which were reserved to DWEER-Tech.






	(C)	 	By virtue of the fact that Calder has the exclusive right to manufacture the Products
worldwide pursuant to the Technology Licence and will, during the term of the Technology
Licence, be manufacturing and supplying Products on a worldwide basis, DWEER-Tech and the
parties hereto wish to suspend the Original Distributorship Agreement and enter into this
Agreement, in order to enable DesalCo to deal directly with Calder with respect to the
distribution of Products in the Territory so long as the Technology Licence is in effect.






	(D)	 	Concurrent with the execution of this Agreement, the Technology Licence has been amended to
remove the exclusion of rights mentioned in recital B above and so as to permit and enable
Calder and DesalCo to enter into this Agreement.




 









 












	(E)	 	Concurrent with the execution of this Agreement, the Original Distributorship Agreement has
been suspended for so long as the Technology Licence is in effect, on the basis that, inter
alia, all clauses thereof that are intended to survive termination (e.g. 6.5 —
Confidentiality) remain in effect, that DWEER-Tech undertakes to immediately inform DesalCo of
termination of the Technology Licence, and that the suspension is to be lifted immediately
upon termination of the Technology Licence.





NOW IT IS HEREBY AGREED as follows:-





	1.	 	INTERPRETATION






	 	1.1	 	In this Agreement, save where otherwise provided or where the context otherwise
requires or admits, the following terms and expressions shall have the meaning set out
below:





	 	 	 
	“Affiliate”
	 	means at any time during the term of this Agreement or extension thereof
with respect to a person, another person that directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under common
control with, such person;

	 
	 	 

	“DWEER

Intellectual

Property”
	 	any patent, copyright, registered or unregistered design, trade mark, or
other industrial or intellectual property right subsisting worldwide in respect
of the Products, and any applications for the same;

	 
	 	 

	“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;







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	“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;

	 
	 	 

	“Original

Distributorship

Agreement”
	 	means the Original Distributorship Agreement as defined in the recitals
hereto.

	 
	 	 

	“person”
	 	includes an individual, partnership, firm, company, association,
unincorporated association or organisation or any entity or body of whatsoever
nature including a governmental, quasi governmental, judicial or regulatory
entity or any department, agency, or political subdivision thereof;

	 
	 	 

	“Products”
	 	means the work-exchanger (also called pressure-exchanger) energy-recovery
systems, components and sub-components thereof for use for water desalination
using the reverse osmosis process manufactured and sold by Calder pursuant to
the Technology Licence;

	 
	 	 

	“Technology

Licence”
	 	means the Technology Licence as defined in the recitals
hereto.

	 
	 	 

	“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;
whether stored electronically or
otherwise, including without
limitation Improvements;







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	“Territory”
	 	means:








	 	(a)	 	all countries,
territories and protectorates in or bordering on the
Gulf of Mexico and the Caribbean
Sea excluding, except as provided for in sub-clause (c)
hereof, the mainland of Mexico, Belize, Guatemala,
Honduras, Nicaragua, Costa Rica, Panama, Columbia and
Venezuela; and
	 
	 	(b)	 	the Bahamas,
Barbados, and the Turks and Caicos Islands; and
	 
	 	(c)	 	the mainland
territory within 30 miles of the Gulf of Mexico or
Caribbean Sea coasts of Mexico, Belize, Guatemala,
Honduras, Nicaragua, Costa Rica, Panama, Columbia and
Venezuela





	 	 	 
	 	 	save that the continental United States and associated United
States coastal islands (e.g. Florida Keys, but not the U.S.
Virgin Islands or Puerto Rico) are specifically excluded;

	“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;





	 	 	 
	“Trade Marks”
	 	the trademarks “DWEER” and “LinX” and all other names, symbols, trade
and service marks (whether registered or unregistered) used by DWEER-Tech or
Calder in connection with or in relation to the Products from time to time.







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	 	1.2	 	In this Agreement, 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 Agreement or any other agreement or document
shall be construed as a reference to this Agreement as the same may from time
to time be amended, varied or supplemented;
	 
	 	(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 Agreement the headings are inserted for convenience only and shall not
affect the construction hereof.





2. DISTRIBUTION OF PRODUCTS IN THE TERRITORY





	 	2.1	 	For the period set out in clause 9 below, Calder hereby grants DesalCo the
exclusive right to distribute and sell the Products in the Territory, and DesalCo
agrees to act in such capacity, subject to and upon the terms and conditions of this
Agreement. For the avoidance of doubt, DesalCo may sell and/or deliver the Products
purchased under this Agreement inside or outside of the Territory, provided that such
Products are to be installed and used within the Territory.
	 
	 	2.2	 	For the period that DesalCo has the exclusive right to distribute and sell the
Products in the Territory, Calder:






	 	(a)	 	shall not appoint any other person as a distributor or agent
for the Products in the Territory;
	 
	 	(b)	 	shall not supply the Products to any person other than DesalCo
or, at the request of DesalCo, Affiliates of DesalCo, who, to the knowledge of
Calder, intends to use or install such Products in the Territory or intends to
resell




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	 	 	 	such Products to any person who intends to use or install such Products in the
Territory without the prior written consent of DesalCo; and
	 
	 	(c)	 	shall obtain a written undertaking, from all persons to whom it
sells the Products (other than DesalCo and Affiliates of DesalCo which it
supplies at the request of DesalCo) that they (1) shall not use or install such
Products within the Territory and (2) shall not resell such Products to any
person who intends to use or install such Products inside the Territory.






	 	2.3	 	DesalCo and its Affiliates shall during the term of this Agreement:






	 	(a)	 	not obtain the Products from any person other than Calder for
use or installation inside the Territory;
	 
	 	(b)	 	not obtain any goods which compete with the Products;
	 
	 	(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;;
	 
	 	(d)	 	not sell the Products purchased from Calder under this
Agreement to any person who, to the knowledge of DesalCo or its Affiliates,
intends to use or install such Products in any country which is outside the
Territory or intends to resell such Products to any person who intends to use
or install such Products outside the Territory; and
	 
	 	(e)	 	obtain a written undertaking from all persons to whom it sells
the Products purchased from Calder under this Agreement that they (1) shall not
use or install such Products outside the Territory and (2) shall not resell
such Products to any person who intends to use or install such Products outside
the Territory.






	 	2.4	 	For so long as this Agreement is in force:






	 	(a)	 	in the event that DesalCo wishes to purchase any Products from
Calder for use or installation outside the Territory, it shall place an order
for such Products with Calder stating that such Products are intended for use
or
installation outside the Territory and stating where such Products are
intended to be used, or installed; and




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	 	(b)	 	in the event that Calder agrees to supply such Products,
DesalCo may purchase such Products for use or installation outside the
Territory, free of any of the restrictions contained in this Agreement, and the
provisions of this Agreement shall not apply to any Products so purchased by
DesalCo or any Affiliate thereof Provided That, notwithstanding this, clause 6
of this Agreement shall apply to all information disclosed to DesalCo by
DWEER-Tech or Calder or which relates to the Products and which comes into the
knowledge, possession or control of DesalCo whether pursuant to or in
connection with this Agreement or pursuant to or in connection with the
Original Distributorship Agreement, and the provisions of clauses 5.4 5.5, 5.7
and 5.8 of this Agreement shall also apply outside the Territory.






	 	2.5	 	Any energy-recovery devices (including pressure-exchangers or work-exchangers)
for water desalination using the reverse osmosis process to be installed on reverse
osmosis desalination units with a brine flowrate of less than 880 US gallons per minute
(200 m3/hour) shall be deemed to be goods which do not compete with the
Products.
	 
	 	2.6	 	DesalCo shall be entitled to describe itself as the “authorised exclusive
distributor” for the Products in the Territory but it shall not hold itself out as
DWEER-Tech’s or Calder’s agent for sales of the Products or as being entitled to bind
DWEER-Tech or Calder in any way.
	 
	 	2.7	 	DesalCo shall not without the express written permission of Calder sell through
a sales agent or to a sub-distributor any Products which it purchases from Calder under
this Agreement.
	 
	 	2.8	 	Nothing in this Agreement shall entitle DesalCo to;






	 	(a)	 	any priority of supply in relation to the Products as against
Calder’s other distributors or customers;
	 
	 	(b)	 	any right or remedy against Calder if any Product supplied by
Calder or its Affiliates is sold, installed, or used in the Territory by any
person other than DesalCo or its Affiliates, provided that Calder can show that
it has obtained
the written undertaking required by sub-clause 2.2(c) above from the person to
whom Calder supplied the Product and further provided that Calder shall, at
the request and expense of DesalCo, take all such steps as DesalCo may
reasonably require to assist DesalCo in preventing the installation, use or
resale of such Products in the Territory.




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	 	2.9	 	Calder shall not have any right or remedy against DesalCo if any Product
supplied by DesalCo or its Affiliates is sold, installed or used outside the Territory
by any person other than DesalCo or its Affiliates, provided that DesalCo can show that
it has obtained the written undertaking required by clause 2.3(e) above from the person
to whom DesalCo supplied the Product and further provided that DesalCo shall, at the
request and expense of Calder, take all such steps as Calder may reasonably require to
assist Calder in preventing the installation, use or resale of such Products outside
the Territory.






	3.	 	SUPPLY OF PRODUCTS






	 	3.1	 	Calder shall use its reasonable endeavours to supply the Products to DesalCo in
accordance with DesalCo’s orders from time to time and to deliver the same in
accordance with DesalCo’s directions.
	 
	 	3.2	 	Calder shall not be under any obligation to continue the manufacture of all or
any of the Products, and shall be entitled to make such alterations to the
specifications of the Products as it may think fit from time to time and may, as it
thinks fit from time to time, change, amend or replace any trademark used in relation
to the Products (including, without limitation, the Trade Marks).
	 
	 	3.3	 	The prices for each order of Products to be supplied under this Agreement shall
be at least as good as and shall not be more than the lowest price charged by Calder
for comparable orders of Products by other persons.
	 
	 	3.4	 	Each order for Products by DesalCo shall be in writing and shall constitute a
separate contract and payment for such Products shall be made by DesalCo without
deduction or set-off. The standard terms and conditions of sale of Calder from time to
time shall apply to all sales of the Products to DesalCo under this Agreement except to
the extent that any of the same is inconsistent with any of the provisions of this
Agreement, in which case the latter shall prevail, and subject to any modifications
thereto agreed to in writing between DesalCo and Calder.




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	 	3.5	 	Prior to acceptance of an order, DesalCo shall provide Calder with
comprehensive accurate drawings and plans showing the manner in which Products will be
incorporated into and installed in the relevant desalination plant. DesalCo shall give
due regard to any observations or comments made by Calder in relation thereto provided
that Calder shall not thereby incur any liability to DesalCo. Calder’s observations
and comments shall be limited to compatibility of the Products with the relevant
desalination plant. Save as agreed in writing by Calder, Calder shall not be liable or
responsible for the design, operation or functioning of any desalination plants.






	4.	 	MARKETING AND USE OF THE PRODUCTS






	 	4.1	 	DesalCo shall use its best endeavours to promote the sale and use of the
Products throughout the Territory and to satisfy market demand therefor.
	 
	 	4.2	 	DesalCo shall be entitled, subject to the terms of this Agreement, to promote
and market the Products in the Territory in such manner as it may think fit, and in
particular shall be entitled to resell the Products to its customers on such terms and
at such prices as it may determine.
	 
	 	4.3	 	DesalCo shall maintain such stocks of parts for the Products as may be
necessary to meet its customers’ requirements.
	 
	 	4.4	 	In connection with the promotion, marketing and the sale of the Products,
DesalCo shall:






	 	(a)	 	make clear, in all dealings with its customers and prospective
customers, that it is acting as distributor of the Products and not as agent of
Calder or DWEER-Tech;
	 
	 	(b)	 	comply with all legal requirements from time to time in force
relating to the storage and sale of the Products;
	 
	 	(c)	 	use only such advertising, promotional, and selling materials
as are approved in writing by Calder;
	 
	 	(d)	 	provide an after sale service for customers in relation to the
Products on terms to be agreed from time to time between DesalCo and Calder;
and




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	 	(e)	 	advise Calder of projected sales of Products as early as
reasonably possible.






	 	4.5	 	Calder shall, from time to time, provide DesalCo with such samples, catalogues,
brochures, and up to date information concerning the Products as Calder may consider
reasonably appropriate in connection with the sale of the Products in the Territory,
and Calder shall endeavour to answer as soon as practicable any technical enquiries
concerning the Products which are made by DesalCo or its customers.
	 
	 	4.6	 	DesalCo shall use its best endeavours to enable Calder to conduct testing and
experimentation of Products on plants owned or operated by DesalCo or its Affiliates at
which Products are installed provided that Calder shall indemnify and save harmless
DesalCo from any costs, expenses, loss or damage, of whatever type and howsoever caused
arising from or relating to such tests or experiments.






	5.	 	INTELLECTUAL PROPERTY






	 	5.1	 	Calder hereby authorises DesalCo to use the Trade Marks in the Territory on or
in relation to the Products for the purposes only of exercising its rights in
performing its obligations under this Agreement and Calder shall not so authorise any
other person, firm or company for such use provided that Calder and/or DWEER-Tech may
prohibit by notice in writing to DesalCo any particular use of the Trade Marks which in
the opinion of Calder damages the goodwill of Calder or DWEER-Tech in such Trade Marks.
	 
	 	5.2	 	DesalCo shall ensure that each reference to and use of any of the Trade Marks
by DesalCo is in a manner, from time to time, approved by Calder and, if requested,
accompanied by an acknowledgement, in a form approved by Calder, that the same is a
trade mark (or registered trade mark as the case may be) of Calder or DWEER-Tech as the
case may be.
	 
	 	5.3	 	DesalCo shall not:






	 	(a)	 	make any unauthorised modifications to the Products;
	 
	 	(b)	 	alter, remove, or tamper with any Trade Marks, numbers or other
means of identification used on or in relation to the Products;




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	 	(c)	 	use any of the Trade Marks in any way that might prejudice
their distinctiveness or validity;
	 
	 	(d)	 	use in relation to the Products any trade marks other than the
Trade Marks without first obtaining the prior written consent of Calder; or
	 
	 	(e)	 	use in the Territory any trade marks or trade names so
resembling any Trade Marks or the trade names of DWEER-Tech or Calder as to be
likely to cause confusion or deception.






	 	5.4	 	Except as provided in clause 5.1, DesalCo shall have no rights in relation to
any of the Trade Marks or the goodwill associated therewith, and DesalCo hereby
acknowledges that, except as expressly provided in this Agreement, it shall not acquire
any rights in respect thereof and that all such rights and goodwill are, and shall
remain, vested in DWEER-Tech or Calder, as the case may be, and that all rights and
benefits arising from the use of the Trade Marks by DesalCo shall accrue to and be for
the benefit of Calder or DWEER-Tech as the case may be.
	 
	 	5.5	 	DesalCo shall, at the request and expense of Calder, take all such reasonable
steps as Calder may reasonably require to assist Calder in maintaining the validity and
enforceability of any DWEER Intellectual Property during the term of this Agreement.
	 
	 	5.6	 	DesalCo shall, at the request and expense of Calder, execute such agreements or
licences in respect of the use of the Trade Marks in the Territory as Calder may
reasonably require, provided that the provisions thereof shall not be more onerous or
restrictive than the provisions of this Agreement.
	 
	 	5.7	 	DesalCo shall not, during the term of this Agreement, challenge the validity of
any DWEER Intellectual Property.
	 
	 	5.8	 	DesalCo shall not do or authorise any third party to do any act which would or
might invalidate or be inconsistent with any DWEER Intellectual Property and shall not
omit or authorise any third party to omit to do any act which, by its omission, would
have that effect or character.
	 
	 	5.9	 	DesalCo shall promptly and fully notify Calder of any actual threatened or
suspected infringement in the Territory of any DWEER Intellectual Property
which comes to DesalCo’s notice, and of any claim by any third party so coming to
its notice that the importation of the Products into the Territory, or their sale
therein, infringes any rights of any other person, and DesalCo shall at the request
and expense of Calder do all such things as may be reasonably required to assist
Calder or DWEER-Tech in taking or resisting any proceedings in relation to any such
infringement or claim.




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	 	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.
	 
	 	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.




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	 	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
	 
	 	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.




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	 	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 without limitation in connection with Products or Legacy Products.
	 
	 	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.






	6.	 	CONFIDENTIALITY






	 	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.






	 	6.2	 	“Restricted Information” means any information:






	 	(a)	 	which is disclosed to DesalCo by Calder or DWEER-Tech pursuant
to or in connection with this Agreement or the Original Distributorship
Agreement or any other agreement for the sale of the Products; (whether orally
or in writing); or
	 
	 	(b)	 	which relates to the Products and which comes into the
knowledge, possession or control of DesalCo pursuant to this Agreement or the
Original Distributorship Agreement or any other agreement for the sale of the
Products;






	 	 	 	regardless of whether or not such information is expressly stated to be confidential
or marked as such.




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	 	6.3	 	Notwithstanding clauses 6.1 and 6.2 above, any Restricted Information may be
disclosed by DesalCo to:






	 	(a)	 	any customers or prospective customers;
	 
	 	(b)	 	any governmental or other authority or regulatory body;
	 
	 	(c)	 	any employees or Affiliates of DesalCo;






	 	 	 	to the extent only as is required for the purposes contemplated by this Agreement,
or as is required by law and subject in each case to DesalCo using its best
endeavours to ensure that the person in question keeps the same confidential and
does not use the same except for the purposes for which the disclosure is made.
	 
	 	6.4	 	Any Restricted Information may be used by DesalCo or its Affiliates for any
purpose, or disclosed by DesalCo to any other person, to the extent only that it is, at
the date hereof, or hereafter, is or becomes public knowledge through no fault of
DesalCo or its Affiliates (provided that in doing so DesalCo and its Affiliates shall
not disclose any Restricted Information which is not public knowledge).
	 
	 	6.5	 	Any press releases, learned papers or similar publications made by Calder that
make reference to DesalCo or its Affiliates or plants owned or operated by DesalCo or
its Affiliates shall be approved in advance by DesalCo provided that such approval
shall not be unreasonably withheld and shall be given in a sufficiently timely manner.






	7.	 	REPRESENTATIONS, WARRANTIES AND LIABILITY






	 	7.1	 	Subject as herein provided Calder warrants to DesalCo that:






	 	(a)	 	all the Products supplied hereunder shall be of satisfactory
quality and shall comply with any legal or other specification, agreed for
them;
	 
	 	(b)	 	it is not aware of any rights of any third party in the
Territory which would or might render the sale of the Products, or the use of
any of the Trade Marks on or in relation to the Products, unlawful.






	 	7.2	 	In the event of any breach of Calder’s warranty in clause 7.1 above (whether
by reason of defective materials, production faults or otherwise) Calder’s liability
shall be limited to:






	 	(a)	 	replacement of the Products in question; or




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	 	(b)	 	at Calder’s option, repayment of the purchase price therefor
(where this has been paid).






	 	7.3	 	Notwithstanding anything to the contrary in this Agreement, DWEER-Tech and/or
Calder shall not be liable to DesalCo by reason of any representation or implied
warranty, condition or other term or any duty at common law, or under the express terms
of this Agreement, for any consequential loss or damage (whether for loss of profit or
otherwise and whether occasioned by the negligence of DWEER-Tech and/or Calder or its
employees or agents or otherwise) arising out of or in connection with any act or
omission of DWEER-Tech and/or Calder relating to the manufacture or supply of the
Products, their resale by DesalCo or their use by any customer.






	 	7.4	 	Each party hereto represents and warrants to the other that:






	 	(a)	 	It is a validly existing company in good standing under the
laws of its jurisdiction of incorporation and is duly qualified as necessary
to carry on its business in the jurisdictions in which such business is carried
on; and
	 
	 	(b)	 	this Agreement has been duly authorised, executed and delivered
by it and is a valid and legally binding obligation of it enforceable in
accordance with its terms.






	8.	 	FORCE MAJEURE






	 	8.1	 	If either party’s performance of this Agreement is affected by Force Majeure
(as defined below) it shall forthwith notify the other party of the nature and extent
thereof.
	 
	 	8.2	 	Neither party shall be held to be in breach of this Agreement, or otherwise be
liable to the other, by reason of any delay in its performance, or non performance, of
any of its obligations under this Agreement to the extent that such delay or non
performance is due to Force Majeure of which it is notified to the other party, and the
time for performance of such obligations shall be extended accordingly.
	 
	 	8.3	 	If the Force Majeure in question prevails for a continuous period in excess of
180 days, the parties shall enter into bona fide negotiations with a view to
alleviating its effects, or to agreeing such alternative arrangements as may be fair
and




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	 	 	 	reasonable, and if no agreement is reached between the parties with respect thereto
within 30 days, then either party may upon giving written notice to the other,
terminate this Agreement without prejudice to any rights, remedies or obligations
which have accrued prior to termination.
	 
	 	8.4	 	“Force Majeure” means, in relation to either party, any circumstances beyond
the reasonable control of that party (including, without limitation, acts of god, war,
strike, lock out, go slow, work to rule or other form of industrial action, fire,
flood, civil disturbance, or government intervention or government failure to act).






	9.	 	DURATION AND TERMINATION






	 	9.1	 	This Agreement shall come into force on the date of this Agreement and, subject
as provided in clauses 9.2, 9.3, 9.4 and 9.5 below, shall continue in force until 31st
October, 2009 whereupon it shall terminate unless previously renewed or extended by the
mutual written agreement of the parties hereto.
	 
	 	9.2	 	Calder shall be entitled to terminate this Agreement if:






	 	(a)	 	DesalCo fails to diligently promote the sale of and the use of
the Products throughout the Territory provided that DesalCo does not have to
offer to sell or sell the Products to competitors that are bidding in
connection with the construction or expansion of desalination projects in the
Territory in connection with which DesalCo or any of its Affiliates is also
bidding (but DesalCo may do so at its sole and absolute discretion); or
	 
	 	(b)	 	DesalCo at any time challenges the validity of all of any of
the DWEER Intellectual Property;






	 	 	 	provided that DesalCo fails to remedy the same within 30 days after receipt of
written notice giving full particulars of the breach and requiring it to be
remedied.
	 
	 	9.3	 	DesalCo may, at any time, terminate this Agreement upon one (1) month’s prior
written notice to Calder.
	 
	 	9.4	 	This Agreement shall automatically terminate upon termination of the Technology
Licence.




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	 	9.5	 	Either party shall be entitled forthwith to terminate this Agreement by written
notice to the other (provided that such termination shall not affect any orders
accepted by and binding on Calder as provided in clause 3.4 above) if:






	 	(a)	 	that other party commits any material breach of any of the
provisions of this Agreement and, in the case of a breach capable of remedy,
fails to remedy the same within 30 days after receipt of a written notice
giving full particulars of the breach and requiring it to be remedied;
	 
	 	(b)	 	an encumbrancer takes possession or a receiver is appointed
over any of the property or assets of that other party;
	 
	 	(c)	 	that other party makes any voluntary arrangement with its
creditors or goes into winding up or liquidation (except for the purposes of
amalgamation or reconstruction and in such manner that the company resulting
therefrom effectively agrees to be bound by or assume the obligations imposed
on that other party under this Agreement);
	 
	 	(d)	 	anything analogous to any of the foregoing under the law of any
jurisdiction occurs in relation to that other party; or
	 
	 	(e)	 	that other party ceases, or threatens to cease, to carry on
business.






	 	9.6	 	For the purposes of clause 9.5 above, a breach shall be considered capable of
remedy if the party in breach can comply with the provision in question in all respects
other than as to the time of performance (provided that time of performance is not of
the essence).
	 
	 	9.7	 	Any waiver by either party of a breach of any provision of this Agreement shall
not be considered as a waiver of any subsequent breach of the same or any other
provision thereof.
	 
	 	9.8	 	The rights to terminate this Agreement given by this clause 9 shall be without
prejudice to any other right or remedy of either party in respect of the breach
concerned (if any) or any other breach.





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	10.	 	CONSEQUENCE OF TERMINATION OR EXPIRATION
	 
	 	 	Upon termination of this Agreement for any reason:







	 	10.1	 	the terms of this Agreement shall continue in full force for so long as is
required and to the extent and insofar as is necessary to allow DesalCo to complete any
binding contracts for the sale of the Products in effect at the date of termination and
any bids, offers, quotations and/or proposals made by DesalCo to other persons prior to
termination of this Agreement which have been accepted before termination of this
Agreement or are capable of being accepted after termination of this Agreement provided
that, for the avoidance of doubt and notwithstanding the foregoing, the provisions of
clauses 2.1, 2.2 and 2.6 above shall cease to apply forthwith upon termination of this
Agreement;
	 
	 	10.2	 	DesalCo shall cease to promote, market or advertise the Products or to make any
use of the Trade Marks other than for the purpose of selling existing stock consisting
of the Products and for such purpose only and to such extent the provisions of this
Agreement shall continue in full force and effect;
	 
	 	10.3	 	the provisions of clause 6, and any other clauses which are intended to survive
the termination of this Agreement, shall continue in force in accordance with their
respective terms notwithstanding termination of this Agreement;
	 
	 	10.4	 	DesalCo shall have no claim against Calder for compensation for loss of
distribution rights, loss of goodwill or any similar loss;
	 
	 	10.5	 	subject to as otherwise provided herein and to any rights, remedies or
obligations which have accrued prior to termination, neither party shall have any
further obligation to the other under this Agreement.






	11.	 	MISCELLANEOUS PROVISIONS






	 	11.1	 	Calder shall be entitled to perform any of the obligations undertaken by it and
to exercise any of the rights granted to it under this Agreement through any Affiliate
and any act or omission of any such Affiliate shall for the purposes of this Agreement
be deemed to be the act or omission of Calder.
	 
	 	11.2	 	DesalCo may assign this Agreement to any Affiliate, but otherwise DesalCo may
not without the prior written consent of Calder assign, mortgage, charge (otherwise
than by floating charge) or dispose of any of its rights hereunder, or subcontract or
otherwise delegate any of its obligations hereunder.




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	 	11.3	 	Nothing in this Agreement shall create or be deemed to create a partnership or
relationship of principal and agent or employer and employee between the parties.
	 
	 	11.4	 	This Agreement contains the entire agreement between the parties with respect
to the subject matter hereof, supersedes 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.
	 
	 	11.5	 	Each party acknowledges that in entering into this Agreement 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.
	 
	 	11.6	 	If any provision of this Agreement 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 Agreement or such other agreement; or
	 
	 	(b)	 	the validity or enforceability in other jurisdictions of that
or any other provision of this Agreement or such other agreement.






	12.	 	JURISDICTION
	 
	 	 	This Agreement 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.
	 
	13.	 	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





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	 	 	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:







	 	13.1	 	if to Calder:


Binzenholzstrasse 447, Industrie Nord

CH-5704 Egliswil

Switzerland

Attention: President

Facsimile No:+(41) 62 769 60 70






	 	13.2	 	if to DesalCo:


Trafalgar Place

1428A West Bay Road

Grand Cayman, Cayman Islands

Attention: President

Facsimile No:+1 (345) 949-2957




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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

	 	 	)	 	 	 
	Frederick W. McTaggart, Director

	 	 	)	 	 	 
	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
	 	 	 	 	 	 







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