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Exhibit 10.5 MATERIAL CONTRACTS
DISCLOSURE AND OPTION TO LICENSE AGREEMENT (THE "AGREEMENT") DATED AS OF APRIL
1, 2000, BY AND BETWEEN KYOCERA CORPORATION, A CORPORATION ORGANIZED UNDER THE
LAWS OF JAPAN ("KC"), AND AVX CORPORATION, A DELAWARE CORPORATION ("AVX")
WHEREAS KC is engaged in the development, manufacture and sale of multilayer
ceramic capacitors and various other ceramic products and possesses patents or
patent applications, know-how and other valuable confidential information as to
such developments, manufacture and products;
WHEREAS AVX is also engaged in the development, manufacture and sale of
multilayer ceramic capacitors and various other ceramic products and possesses
patents or patent applications, know-how and other valuable confidential
information as to such developments, manufacture and products; and
WHEREAS KC and AVX are each desirous of engaging in an exchange of their
respective valuable confidential information in order to promote the technical
progress of each of the companies.
NOW, THEREFORE, for and in consideration of the mutual promises and covenants
set forth herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS
The following terms shall have the following meanings for purposes of this
Agreement unless otherwise clearly required by the context:
SECTION 1.01. DISCLOSING PARTY. "Disclosing Party" shall mean the party hereto
that discloses Confidential Information to the other party as contemplated in
this Agreement.
SECTION 1.02. RECEIVING PARTY. "Receiving Party" shall mean the party hereto
that receives Confidential Information from the other party as contemplated in
this Agreement.
SECTION 1.03. CONFIDENTIAL INFORMATION. "Confidential Information" shall mean
all of the technical and other information, know-how and data (including without
limitation designs, drawings, manuals, procedures, techniques, processes,
methods, practices, specifications and the like) relating to the manufacture or
use of multilayer ceramic capacitors and various other technical ceramic
products. Confidential Information shall include all information and documents
marked "confidential," "proprietary" or by some similar designation and all
other information and documents not so marked, but which the Receiving Party
believes or reasonably should believe are confidential or proprietary
information of the Disclosing Party.
ARTICLE II
EXCHANGE OF CONFIDENTIAL INFORMATION
During the term of this Agreement, KC and AVX shall exchange Confidential
Information at such times, by such means and at such places as shall from time
to time be mutually agreed upon by KC and AVX.
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ARTICLE III
RESTRICTIONS ON DISCLOSURE OR USE OF CONFIDENTIAL INFORMATION
The Receiving Party acknowledges that the Confidential Information is a valuable
proprietary asset of the Disclosing Party. The Receiving Party acknowledges that
disclosure by the Disclosing Party to the Receiving Party of any of the
Confidential Information, whether written, oral or in any other form or medium,
is made in strictest confidence and solely for the limited purposes defined by
this Agreement. The Receiving Party agrees that:
(a) the Receiving Party shall not employ any of the Confidential Information of
the Disclosing Party in a product that is sold by the Receiving Party or in the
manufacture of such a product unless the Disclosing party agrees in writing to
such use, which the Disclosing Party may agree to in its sole discretion or may
only agree to pursuant to a royalty-bearing license agreement as provided for in
Article VI;
(b) the Receiving Party shall at all times use its best efforts to maintain the
Confidential Information as confidential and secret. The Receiving Party shall
at all times use at least the same degree of care to avoid unauthorized
disclosure, use or publication of any of the Confidential Information as it
employs and as a prudent business person would employ with respect to its own
confidential information;
(c) the Receiving Party may disclose the Confidential Information to its own
employees so long as the Receiving Party has determined prior to such disclosure
that disclosure to such employees is reasonably necessary, that such employees
are aware of the confidential nature of the Confidential Information and of the
obligation of the Receiving Party under this Agreement and that such employee is
by contract, or by local custom, enforceably obligated to maintain the
confidentiality of such information and is obligated to perform the obligations
of the Receiving Party set forth in this Agreement;
(d) the Receiving Party shall not disclose any of the Confidential Information
to any individual or entity outside of the Receiving Party without the prior
written consent of the Disclosing Party in each instance, which consent may be
withheld for any reason or for no reason and, if granted, may be granted on such
terms as the Disclosing Party may in its sole discretion establish from time to
time;
(e) the Receiving Party shall not any time use any of the Confidential
Information to provoke an interference with any patent application which the
Disclosing Party has filed or hereafter may file with respect to any products or
any of the Confidential Information or to amend any claim in any pending patent
application to expand the claim to read on, cover or dominate any invention
(whether or-not patentable) disclosed in the Confidential Information;
(f) the Confidential Information shall at all times remain the property of the
Disclosing Party and no license in such Confidential Information shall be
implied. Except as provided in Article VI below, the Receiving Party
acknowledges that it acquires no right, title or interest in or to any of the
Confidential Information by reason of the Disclosing Party's disclosure of any
of the Confidential Information under this Agreement; and
(g) immediately following each and every request by the Disclosing Party, the
Receiving Party shall return to the Disclosing Party all documents and materials
of any nature (and copies thereof) comprising the Confidential Information given
to or in the possession of the Receiving Party.
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ARTICLE IV
LIMITATION
The Receiving Party shall have no obligation with respect to any Confidential
Information which:
(a) is already known to the Receiving Party and with respect to which the
Receiving Party notifies the Disclosing Party within 30 days after disclosure
that such Confidential Information is already known to the Receiving Party;
(b) is or becomes publicly known through no wrongful act of the Receiving Party;
(c) is disclosed to the Receiving Party by a third person not in violation of
any obligation of nondisclosure owed to the Disclosing Party; or
(d) is approved for released by written authorization of the Disclosing Party.
The receiving Party has the burden of proving the existence of any of the above
exceptions. The Disclosing Party has the right to inspect the Receiving Party's
records to determine the source of any Confidential Information claimed to be
within any of the above exceptions.
ARTICLE V
ENFORCEMENT
In the event of any breach or threatened breach by the Receiving Party of any of
the provisions of Article III above, the Disclosing Party, in addition to any
other rights and remedies, shall, without the necessity of proving actual
damages or the posting of any bond or similar security, be entitled to temporary
and permanent injunctive relief to prevent such breach or threatened breach.
ARTICLE VI
LICENSE REQUEST
SECTION 6.01. REQUEST FOR LICENSE. At any time during the term of this
Agreement, the Receiving Party shall have the right to request a license from
the Disclosing Party as to any of the Confidential Information and the
applicable patents (if any) of the Disclosing Party relating thereto.
SECTION 6.02. EXERCISE OF OPTION. The request of the Receiving Party to license
such Confidential Information and applicable patents (if any) of the Disclosing
Party relating thereto shall be exercised by delivery to the Disclosing Party of
a written request specifying the Confidential Information and patents (if any)
relating thereto that the Receiving Party desires to license.
SECTION 6.03. TERMS OF LICENSE. Upon receiving such a request pursuant to
Section 6.02, the Disclosing Party may decline to license such Confidential
Information or it may elect to attempt to agree upon the terms and provisions of
such license, which may include, without limitation, a royalty rate and/or other
payment for the licensing of such Confidential Information and patents (if any);
provided, however, that such agreed upon rate and/or other payment shall be
equivalent to that which an independent unrelated party would agree to at
arm's-length. The parties acknowledge that the terms of any such license are
subject to the approval of the AVX Board of Directors (or the Special Advisory
Committee thereof). The agreed upon rate and/or other payment shall be
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documented and supported at the time of the agreement between the parties
hereto. In the event that the parties hereto are unable to agree upon a rate
and/or other payment, then no license will be granted.
ARTICLE VII
NO IMPLIED LICENSE
Except as provided in Article VI above, nothing contained herein shall be deemed
to constitute the grant by either party hereto to the other of any right, title,
interest or license in or to any confidential information, trademarks,
copyrights, trade secrets, patents, patent applications or other proprietary
rights.
ARTICLE VIII
TERM AND TERMINATION
SECTION 8.01. TERM. The term of this Agreement shall run for 5 years from April
1, 2000. This Agreement may be continued by the mutual agreement of the parties
for one year and for each one year thereafter, upon terms then negotiated. In
the event of the termination or expiration of the term of this Agreement, except
as otherwise provided in Section 6.03 of this Agreement, each party shall return
to the other party all documents and materials of any nature (and copies
thereof) comprising Confidential Information given to or in the possession of
such other party.
SECTION 8.02. TERMINATION. This Agreement may be terminated immediately at the
option of one party in case the other party becomes involved in receivership,
bankruptcy or insolvency proceedings or in the event of action by any government
which would render impossible performance of any obligations under this
Agreement by either party. In any case wherein a breach of any of the covenants
of this Agreement by either party is not remedied within a 90 day period, this
Agreement may be terminated if written notice of default without such 90 day
remedy is given by the other party in the manner provided in Section 9.08 of
this Agreement.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. ARBITRATION. All disputes, controversies, or differences which may
arise between the parties, out of or in relation to or in connection with this
Agreement, or breach thereof, shall be finally settled by arbitration pursuant
to the Japan-America Trade Arbitration Agreement of September 16, 1952, by which
each party hereto is bound. Such Arbitration shall be held in Osaka, Japan if
initiated by AVX and shall be held in South Carolina if initiated by Kyocera.
SECTION 9.02. WAIVER. The failure of either party to enforce at any time any
provision of this Agreement or to require at any time performance by the other
party of any provision hereof will not be construed to be a present or future
waiver of such provisions or in any way affect the validity of this Agreement or
any provision hereof or the right of the other party thereafter to enforce each
and every such provision. One or more express waivers by either party of any
provision, condition or requirement of this Agreement will not constitute a
waiver of any future obligation to comply with such provision, condition or
requirement, unless so provided in a writing signed by the parties hereto.
SECTION 9.03. ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes the
complete and full understanding between the parties hereto with respect to the
subject matter hereof, and this Agreement supersedes all prior and
contemporaneous agreements or understandings between the parties hereto relating
to the subject matter thereof. This Agreement may not be modified or amended
except with the written consent of both parties.
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SECTION 9.04. ASSIGNMENT. This Agreement and the rights and obligations of a
party under this Agreement may not be assigned or transferred without the prior
written consent of the other party hereto.
SECTION 9.05. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which will constitute an original but all of which when
taken together will constitute but one instrument. Counterparts may be delivered
by facsimile.
SECTION 9.06. SEVERABILITY. If any provision or provisions hereof shall, to any
extent, be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions hereof shall not in any way be
affected or impaired thereby and will be valid and enforceable to the fullest
extent permitted by law.
SECTION 9.07. CAPTIONS. Captions contained in this Agreement are inserted as a
matter of convenience and do not define, limit, extend or describe the scope of
this Agreement or the intent of any provision.
SECTION 9.08. NOTICES. All notices or other communications required or permitted
to be given hereunder shall be in writing and shall be delivered by hand or sent
by prepaid telex, cable or telecopy, or sent, postage prepaid, by registered,
certified or express mail (return receipt requested) or reputable overnight
courier service, and shall be deemed given when so delivered by hand, telexed
cabled or telecopied, or if mailed, ten days after mailing (two business days in
the case of express mail or overnight courier service), as follows (or at such
other address for a party as may be specified by like notice):
KYOCERA CORPORATION
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▇▇▇▇▇▇▇-▇▇, ▇▇▇▇▇ ▇▇▇-▇▇▇▇, ▇▇▇▇▇
Attention: President
AVX CORPORATION
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
U.S.A.
Attention: Chief Financial Officer
SECTION 9.09. NO THIRD PARTY BENEFICIARIES. AVX and KC agree that the execution,
delivery and performance of this Agreement are not intended to create any
contractual rights benefiting any third parties and that in the event of breach
or failure to perform by either party of its covenants or agreements contained
in this Agreement such party shall be liable only to the other party hereto.
SECTION 9.10. GOVERNING LAW. This Agreement shall be governed and interpreted in
accordance with the internal laws of South Carolina applicable to agreements
made and to be performed entirely within such State, without regard to conflicts
of law principles.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
as of the date first written above.
KYOCERA CORPORATION, AVX CORPORATION
by by
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President Title: Chief Executive Officer
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