Document:

EX-10.21 REGULATIONS FOR CYCLES OF THE SHARE PLAN

 

Exhibit 10.21

REGULATIONS FOR THE FIRST AND SECOND CYCLE OF THE SHARE PLAN LINKED TO OBJECTIVES.

1. INTRODUCTION

At the proposal of the Appointments & Remuneration Committee, these regulations (the “Regulations”)
have been approved, by the Executive Committee of Banco Santander, S.A. (“Banco Santander” of “the
Bank”) at its meeting on December 3, 2007, in execution of the resolution adopted by the Bank’s
shareholders at the Ordinary General Meeting on 23rd June 2007. The Regulations contain
the rules governing the First Cycle of the Grupo Santander Share Plan Linked to Objectives,
corresponding to the years 2007 and 2008 (the “First Cycle”) and the years 2007, 2008 and 2009 (the
“Second Cycle”).

In cases where, due to the application of local ruling, the contents of the Regulations need to be
adapted or supplemented, the respective bodies of the institutions have adopted the necessary
resolutions. The regulations resulting from such resolutions (in each case, the “Supplementary
Regulations”) will be notified to the Participants affected thereby.

Therefore, the First Cycle and Second Cycles are governed by the Regulations, and where applicable,
by the Supplementary Regulations.

For the purpose of these regulations, “Grupo Santander” is understood as the group comprising, at
all times, Banco Santander and the companies consolidated with it by global integration.

2. PARTICIPANTS AND MAXIMUM NUMBER OF SHARES ASSIGNED

First Cycle Participants (the “Participants”) are those executives of Grupo Santander (including
executive Directors and members of Senior Management) that the Executive Committee, acting by
delegation from the Board of Directors, has decided to include therein.

Under the terms contemplated in the Regulations and the Supplementary Regulations, and provided the
established conditions are met, each of the Participants will be eligible to receive up to the
maximum number of Santander shares assigned to him/her by the Executive Committee (the “Maximum
Number of Shares”) for each of the Cycles.

The status of Participant and the Maximum Number of Shares will be notified individually to each of
the Participants.

3. NUMBER OF SHARES TO BE AWARDED

The number of shares awarded to each Participant will be determined by multiplying the Maximum
Number of Shares assigned to the Participant in question by the sum of the coefficients obtained on
comparing, under the terms contemplated in the Regulations, the performance of Banco Santander with
that of the institutions included in a group (the “Benchmark Group”) with respect to two
parameters: Total Shareholder Return (“TSR”) and the growth of Earnings per Share (“EPS”).

In order to reach such determination, the following rules will apply:

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	(i)	 	TSR:
	 
	 	 	TSR will be understood, for the purpose of this plan, as the difference (expressed as a
percentage ratio) between the Final Value (as defined below) of a hypothetical
investment in ordinary shares (of Banco Santander and of each of the institutions
included in the Benchmark Group) and the Initial Value (as defined below) of that same
hypothetical investment, bearing in mind that for calculating such Final Value, the
dividends or other similar amounts received by the shareholder on said investment
during the respective period of time will be considered as if they had been invested in
more shares of the same type on the first date on which the dividend is payable to the
shareholders and at the average weighted listed price on that date.
	 
	 	 	The Initial Value will be taken as the weighted average per daily volume of the average
weighted price of the share in question on the fifteen Trading Days (as defined below)
immediately preceding 1st April 2007 (exclusive). The Final Value will be
taken as the weighted average per daily volume of the average weighted price of the
share in question on the fifteen Trading Days immediately prior to 1st April
2009 or 1st April 2010 (both exclusive), referring to the First or Second
Cycle, respectively.
	 
	 	 	For calculating the Initial and Final Values, the listed price reference in the Main
Market for the share in question will be taken (i.e., the market with the largest
trading volume, and in case of doubt, that which coincides with the place or country of
the registered office of the institution in question and in the currency in which the
share is listed).
	 
	 	 	Trading Day will be understood as any day on which the Main Market for the share in
question is open for trading during normal hours.
	 
	(ii)	 	EPS growth
	 
	 	 	For both Banco Santander and for each of the institutions included in the Benchmark
Group, EPS growth is understood as the percentage difference between the Earnings Per
Share (as defined below) stated in the audited consolidated financial statements in
respect of the last financial year closed to 31st December 2006, inclusive
(the “Initial Financial Statements”) and the Earnings Per Share stated in the audited
consolidated financial statements for the last financial year closed by each
institution to 31st December 2008 or 31st December 2009 (both
inclusive) referring to the First or Second Cycle, respectively (the “Final Financial
Statements”).
	 
	 	 	Earnings Per Share for each institution will be understood as the datum shown as
earnings per share in ordinary and uninterrupted activities in their Initial or Final
Financial Statements, as the case may be.
	 
	(iii)	 	Benchmark Group
	 
	 	 	The Benchmark Group will initially include the following 21 institutions:

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	Bank	 	Country
	ABN AMRO Holding

	 	The Netherlands
	Banco Itau

	 	Brazil
	Bank of America

	 	U.S.A.
	Barclays

	 	U.K.
	BBVA

	 	Spain
	BNP Paribas

	 	France
	Citigroup

	 	U.S.A.
	Credit Agricole

	 	France
	HBOS

	 	U.K.
	HSBC Holdings

	 	U.K.
	Intesa Sanpaolo

	 	Italy
	JP Morgan Chase & Co.

	 	U.S.A.
	Lloyds TSB Group

	 	U.K.
	Mitsubishi

	 	Japan
	Nordea Bank

	 	Sweden
	Royal Bank of Canada

	 	Canada
	Royal Bank of Scotland Group

	 	U.K.
	Société Générale

	 	France
	UBS

	 	Switzerland
	Unicredito Italiano

	 	Italy
	Wells Fargo & Co.

	 	U.S.A.

	(iv)	 	Comparison
	 
	 	 	Once the TSR and the EPS growth have been calculated for both Banco Santander and each
of the institutions included in the Benchmark Group, the institutions will be placed in
descending order, from the highest to the lowest, in respect of each of the two
parameters.
	 
	 	 	Each of the two criteria (TSR and EPS growth) will have a separate 50% weighting when
determining the percentage of shares to be awarded, based on the following scale and in
terms of Banco Santander’s relative position versus the Benchmark Group institutions:

	 	 	 	 	 	 	 
	 	 	 	 	Percentage
	Santander’s	 	 	 	of shares
	position in	 	 	 	gained over
	the TSR	 	 	 	the
	ranking	 	 	 	maximum
	1st to 6th
	 	 	 	 	50	%
	 	 	 	 	 
	7th
	 	 	 	 	43	%
	 	 	 	 	 
	8th
	 	 	 	 	36	%
	 	 	 	 	 
	9th
	 	 	 	 	29	%
	 	 	 	 	 
	10th
	 	 	 	 	22	%
	 	 	 	 	 
	11th
	 	 	 	 	15	%
	 	 	 	 	 
	12th onwards
	 	 	 	 	0	%

	 	 	 	 	 	 	 
	Santander’s	 	 	 	Percentage
	position in	 	 	 	of shares
	the EPS	 	 	 	gained over
	growth	 	 	 	the
	ranking	 	 	 	maximum
	1st to 6th
	 	 	 	 	50	%
	 	 	 	 	 
	7th
	 	 	 	 	43	%
	 	 	 	 	 
	8th
	 	 	 	 	36	%
	 	 	 	 	 
	9th
	 	 	 	 	29	%
	 	 	 	 	 
	10th
	 	 	 	 	22	%
	 	 	 	 	 
	11th
	 	 	 	 	15	%
	 	 	 	 	 
	12th onwards
	 	 	 	 	0	%

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Should any of the institutions included in the Benchmark Group be acquired by another
company, cease to trade or disappear, they will be removed from the Benchmark Group. In
such event or any other similar situation, the comparison with the Benchmark Group will
be made in such a way that, for each of the parameters being considered (TSR and growth
of EPS) the maximum percentage of shares will be gained if Santander remains within the
first quartile (including the 25%ile) of the Benchmark Group. No shares will be gained
if Santander is below the average (50%ile) of the Benchmark Group. 30% of the maximum
of the shares will be gained within the average (50%ile) and for positions between the
average (exclusive) and the first quartile (25%ile exclusive), the calculation will be
made by linear interpolation.

4. PERMANENCE

In order to be elegible to receive the shares finally resulting from the determination made as
established in section 3 above, the Participant must have been actively employed by Banco
Santander (or a company belonging to its Group) for an uninterrupted period from the date of
notification of his/her Participant status until 30th June 2009 or 30th
June 2010 (in the case of the First or Second Cycle, respectively) notwithstanding what is
stated in the following rules of this section.

When termination of the employment relationship with Banco Santander or another Grupo Santander
institution is due to retirement or pre-retirement on the initiative of the employer of the
Participant, unfair dismissal, unilateral waiver by the Participant with just cause, forced
leave of absence, permanent disability or death, or because the employer institution, other
than Banco Santander, ceases to belong to Grupo Santander,
entitlement to the award of the shares will continue as if none of such circumstances had occurred, except for the following
changes:

	-	 	In the event of death, such entitlement will pass to the Participant’s successors.

	-	 	The number of shares to be awarded will be the result of multiplying the
corresponding Maximum Number of Shares to be awarded as stated in section 3 above, by the
quotient resulting from dividing the number of days elapsed between 1st January
2007 and the date of occurrence of the death, retirement, pre-retirement, dismissal, leave
or other circumstance determining the application of this rule, both inclusive, by the
number of days existing between 1st January 2007 and 31st December
2008, both inclusive, or between 1st January 2007 and 31st December
2009, both inclusive, in the case of the First or Second Cycles, respectively.

In cases of justified temporary leave, leave of absence to care for children or other family
members, no change will occur in the rights of the Participant.

Should the Participant be transferred to another company belonging to the Group (including
international assignment and/or expatriation), without any other modification circumstances
occurring, no change will occur in the Participant’s rights.

Whenever the employment relationship is terminated by mutual agreement or because the
Participant obtains a leave of absence not referred to in any of the

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preceding paragraphs,
whatever is established in the termination or leave of absence agreement will apply.

5. AWARDING OF SHARES

If the necessary requirements have been met, the shares assigned to each Participant, in the
number as contemplated in sections 2 and 3 above, will be awarded to him/her no later than
31st July 2009 or 31st July 2010, in the case of the First or Second
Cycles, respectively, on the date determined by the Executive Committee (by delegation from the
Board of Directors) of Banco Santander.

The shares will be handed over through the technical mechanisms (securities account, deposit...)
appropriate in each case, the respective expenses being for the Participant’s account.

As appropriate, the shares may be handed over by Banco Santander or by another of its Group
companies, using old or new shares, already available or obtained from third parties.

What is stated in the preceding paragraphs is understood as notwithstanding the fact that, in
those cases in which, in the exclusive opinion of the Board of Directors of Banco Santander
(or, by delegation from the latter, its Executive Committee) legal, regulatory or tax
circumstances make it necessary or advisable, the mechanisms used for handing over the shares
may be adapted (including substitution by equivalent cash payments) without altering the basic
conditions. Such cases, to be judged by the Board of Directors (and, by delegation from the
latter, the Executive Committee of Banco Santander) are governed by the respective
Supplementary Regulations.

6.
ADMINISTRATION OF THE PLAN

The Board of Directors of Banco Santander (and by delegation from it, its Executive Committee)
has the necessary powers for the administration of the First and Second Cycles, notwithstanding
the possibility of authorising the appropriate bodies or departments to carry out specific
tasks related thereto and any execution decisions requiring the participation of local bodies
or departments or of the different institutions whose employees include Participants.

In particular, the Executive Committee may interpret what is established in the Regulations and
Supplementary Regulations and adapt them (without affecting the basic content of the
resolutions of the General Meeting referred to in section 1) to any new circumstances that
might arise, including, whenever necessary, the rules of comparison among the Benchmark Group
institutions in the event of unexpected alterations.

Banco Santander will use the services of an independent third party to carry out the work
required for calculating the fulfilment of the objectives to which the number of shares to be
awarded is linked, and to advise it in cases where it is necessary to interpret or adapt the
Regulations or the Supplementary Regulations.

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7. GENERAL PROVISIONS

The assigning of shares in the First and Second Cycles, and therefore, the status as
Participant of the same, gives rise exclusively to the expectations and rights contemplated in
the Regulations (and where applicable, in the Supplementary Regulations) under the terms
established therein. Such assignment is of an extraordinary nature, does not constitute salary
and does not grant any rights additional to those contemplated in these Regulations (and where
applicable, the Supplementary Regulations) or consolidate the right of being a Participant in
any future cycles of the Plan for the Awarding of Shares Linked to Objectives or any other
plan.

Each of the Participants should confirm with their tax advisors the tax treatment specifically
applicable to them in respect of the income generated by these First and Second Cycles. In any
event, the Participant or his/her assignees are responsible for paying any tax, levy or duty
generated as a result of their participation in the First and Second Cycles, notwithstanding
the fact that their employer may be obliged to make withholdings or payments on account to the
Public Treasury, which in any event will be passed on to the Participant.

Each Participant will be responsible for meeting the Social Security obligations resulting from
their participation in these First and Second Cycles, notwithstanding those applicable to their
employer.

6EX-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

8

 

	 	 	 	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.

9

 

	 	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

10

 

Schedule 1

Amended and Restated Distributorship Agreement

11

 

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
	 	 	 	 	 	 

12

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