EXHIBIT 10(aj)
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Confidential Treatment Requested as to certain information contained in this
Exhibit and filed separately with the Securities and Exchange Commission.
PURCHASE AND SALE AGREEMENT
50 MW Solar Module Production Line
August 26, 2009
1. The Parties:
Spire Corporation (the "Seller"), a business incorporated in the
Commonwealth of Massachusetts, with its principal place of business at
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇, U.S.A.;
Uni-CHEM Co., Ltd. (the "Buyer"), a business established in Republic of
Korea, with its principle place of business at ▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇-▇▇ ▇▇▇▇▇▇-▇▇▇▇, ▇▇▇▇▇▇-▇▇, ▇▇▇▇▇, ▇▇▇▇▇
2. Terms of Agreement:
Seller agrees to sell to Buyer and Buyer agrees to buy from Seller the
Products described in Article 3 below, pursuant to the provisions of the
Purchase and Sale Agreement ("Agreement") hereinafter set forth. Such
provisions shall prevail and no other article, condition, clause or term
shall have any effect unless specifically admitted by this document.
3. The Products bought by Buyer and sold by Seller are set forth in this
Article below and will be shipped to Buyer on or before June 1, 2010
(reference section 5d). The capacity of the line is based on twenty-four
hours per-day, seven days per-week, fifty weeks per-year option. Partial
shipments are allowed as needed and any shipment may be transshipped as
may be appropriate. The specifications of the Products are delineated in
Attachment B hereto:
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*** Represents text omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the Securities and Exchange
Commission.
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NOTE: Shipments schedule are contingent upon receipt by Seller of
Buyer's initial non-refundable down payment of *** on or before October
20, 2009, as well as the fulfillment of certain other conditions, that
if applicable, are stated elsewhere below. Any failure by Buyer to
adhere to the payment plan as outlined in Article 4 may cause Seller to
revise the shipment schedule.
4. Price and Terms of Payment:
a. Price:
The price for the Products, including technical documents, technical
services, and training in their operation and maintenance, as set
forth above, is a total of U.S. Dollars $13,250,000 (Thirteen
Million, Two Hundred Fifty Thousand US Dollars), Ex Works USA, and
Japan.
50MW Automated Module Production Line
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No. Description Quantity
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*** Represents text omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the Securities and Exchange
Commission.
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Total for 50MW Automated Module Line 13,250,000
b. Seller will supply information on their recommended freight
forwarder for the Ex-works shipment. If Buyer selects a third party
freight forwarder Seller must accept the subject forwarder. If Buyer
does not select Seller's recommended freight forwarder or a third
party forwarder acceptable to Seller, Seller will then implement a
*** additional Customer Service Surcharge.
c. Payment:
Buyer shall make payments to Seller in accordance with the schedule
outlined below:
c1. Buyer shall make a non-refundable Down Payment to Seller by
telegraphic transfer as soon as possible after execution of this
Agreement but not later than October 20, 2009 based upon Seller's
invoice, in the amount of *** Such payment shall be effected by
Buyer via telegraphic transfer to Seller's bank as below:
***
c2. Buyer subsequently shall establish irrevocable, transferable, and
divisible confirmed Letter of Credit for the remaining balance price
of the Products of each shipment, in the amounts listed in the
schedule below:
A Letter of Credit of *** shall be established. Such Letter of
Credit shall be established on or before March 1, 2010. The
expiration date for the Letter of Credit described in this Article
shall not be earlier than one hundred and twenty (120) days from the
date of the last scheduled shipment. Such Letter of Credit shall be
drawable by Seller in One (1) sequence:
i) A draw of *** upon presentation of applicable shipping
documents for the Ex-Works ▇▇▇▇▇▇▇▇.▇▇ outlined in Attachment
F.
*** Represents text omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the Securities and Exchange
Commission.
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Other terms and conditions of this Letter of Credit shall be in
accordance with the document entitled "Letter of Credit
Requirements" and attached hereto as Attachment A. Buyer agrees to
amend this Letter of Credit promptly upon Seller's request provided
that Seller furnishes a satisfactory and reasonable explanation for
such amendment, and that the terms of the amendment are mutually
agreed upon by Buyer and Seller.
5. Performance and Performance Period:
a. Conditions precedent for Seller to begin performance:
i. Purchase and Sale Agreement signed by both Parties;
ii. Down payment received by Seller on or before October 20,
2009.
b. Performance:
Seller shall make delivery in full of the of the Products, including
all Product components; install products at the Buyer's site in
accordance with standard industry practices; as well as provide
equipment training (operation and maintenance), using its best
efforts to deliver the Products in accordance with the shipment
schedule in Article 3. Installation shall be defined as the task of
making operational all applicable Products (equipment) including the
disposition of each Product in its proper location, connection with
the required utilities, (electricity, gas, water, compressed air,)
and determination that each Product performs the mechanical
functions for which it was designed as stated in Attachment A. All
training services, training materials, equipment manuals, and the
like shall be provided to Buyer by Seller prior to the Ex- Works
shipment of the Products. Process training shall be conducted in
accordance with the agenda and schedule to be mutually agreed upon
by Seller and Buyer, and shall be completed prior to the Ex- Works
shipment of the Products. The training is scheduled for a two (2)
week term at Seller's facility. Every deliverable Product shall be
new; shall evidence high quality workmanship, be free of any design
defects that may inhibit the smooth operation; and which satisfies
the purpose of this Agreement. Each unit of deliverable equipment
shall correspond to the specifications attached as Attachment A; be
accompanied by a standard spare parts package which shall be defined
by Seller prior to Ex- Works shipment; and be subject to a Limited
Warranty as specified elsewhere in Article 8 of this Agreement.
All of the Products and related components delivered by the Seller
shall be packed using new and sufficiently strong packaging
appropriate for shipping, transportation, loading and unloading.
According to the requirements of each unit of equipment and any
other items included with them, the Seller shall, consistent with
accepted industry standards, supply any protection necessary to
protect such equipment and other items from humidity, water, rust,
erosion, or any other
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environmental factor which may damage the equipment or other items,
and to insure that the Products arrive at the Buyer's site
undamaged.
Each package, box or crate shall include the following documents:
1. Two (2) copies of a detailed packing list;
2. Two (2) copies of quality certificated;
3. Operation, service and repair manuals
4. Spare parts list;
5. Two (2) copies of assembly drawing as required for routine repair
and maintenance.
c. Performance Period:
The period of performance shall commence when the conditions
precedent as described above are met and shall conclude with the
delivery of the Products, the installation of the same at a site
specified by the Buyer, completion of such training as is specified
herein, and the qualification of the Products as agreed herein by
the Parties.
d. Earlier Installation Date for Module Line
To accommodate the Buyers request for an earlier start date on the
Module line the Seller will install a 25MW semi automated line by
March 15, 2010. The line will be operational and producing
functional PV modules. During the operation of the 25MW
semiautomated line the Buyer will be phasing in the Fully Automated
Line of 50MW starting in June 2010. During the phase in period the
25MW semi automated line will continue to be fully operational until
the 50MW Fully Automated Line is complete.
6. Alterations to Product:
The Products specified in Article 4 above and as described in detail in
Attachment A hereto are standard Products manufactured and assembled by
Seller. Any requirement by Buyer to have Seller modify specifications
and features of the Products may affect the price, even if such
modification eliminates a feature or relaxes a specification, as all
changes require an engineering charge. Other charges may apply. Buyer
will submit all such requirements to Seller as soon as they become
known. Seller will advise Buyer as soon as practical the effect all such
requirements are estimated to have on price, delivery schedule,
performance, and warranties as herein stated. In particular, Buyer
agrees that any subsequent requirement other than addressed above
thereafter agreed upon by the Parties will constitute a change in
Seller's performance requirements and may further affect the delivery
schedule cited above. In the event of any changes required by Buyer, in
requesting such change, Buyer thereby releases Seller from strict
adherence to this schedule, although Seller is expected to use its best
efforts to minimize or eliminate any delay that may result from changes
required by Buyer. Seller reserves the right to make changes to the type
or source of parts used to manufacture the components of the
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Products to eliminate any procurement problems or to improve quality of
operations. Such changes will be made without notice to Buyer, but
Seller's responsibility to furnish Products of equal or improved in
quality shall not be altered.
7. Certain Responsibilities of Buyer:
a. Installation Site Preparation:
Buyer will have an Installation Site, including utility/facility
(power, water, compressed air, factory floor space) requirements,
prepared for Seller to install the Products at the time of its
arrival at the location/address specified by Buyer, but in any case
not later than thirty (30) days after the arrival of the last
Product at such location/address. Failure by Buyer to make such a
Site, including all required utility/facility items available at or
before the expiration of the thirty (30) day period will allow
Seller, at its sole discretion, to consider itself absolved of any
further performance with regard to training and installation except
at Seller's convenience thereafter. Any delay for any reason (save
for Force Majeure) arising with the Buyer that delays the completion
of installation beyond ninety (90) days after the arrival of the
Products at Buyer's Site will cause the full amount of the
outstanding balance at that time to become due and payable by Buyer,
at Seller's sole discretion. Buyer will promptly make the required
change to the Letter of Credit to facilitate this collection upon
application of Seller. Seller shall, in such instance adjust its
installation schedule for its own convenience but with consideration
to Buyer's schedule to the maximum extent possible. In addition, any
direct added costs incurred by Seller by reason of Buyer's failure
to proceed with installation of the Product and training of its
personnel shall be charged to Buyer, invoiced separately, and
payable thirty (30) days from invoice date. The site shall possess
all the utility/facility requirements as agreed by both parties. If
the Seller's technical staff is not able to arrive at the site at a
time mutually convenient, the Buyer may start inspection and
installation at its own risk.
b. Inspection:
The Buyer shall inform the Seller of the inspection date twenty (20)
days prior to the scheduled date for inspection. Seller may send its
representative(s) to join in the inspection at its expense. If any
part is missing, defective, damaged, or there is any other
non-conformity present, Buyer shall notify Seller immediately in
writing with appropriate documentation. Buyer shall correct such
non-conformities in accordance with the warranty attached to the
Agreement as Attachment B. Seller's adherence to the terms of the
warranty prior to the completion of installation does not in any way
shorten the ordinary warranty period. Seller has the right to
photograph or videotape the container opening and inspection
process.
c. Supplemental Training:
Seller will provide supplemental training during the course of the
installation process for up to four (4) operators (training of
additional operators may result in additional cost). All such
training is understood to be supplemental to the training conducted
at
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Seller's facility, and constitutes "on-the-job-training" conducted
during the Installation process. All such trainees must be
proficient in spoken and written English, or Buyer must provide at
its expense a skilled interpreter/translation expert to render
Seller's trainer/installer's instructions into trainee's native
language in an effective and efficient manner. Seller will provide
operation, repair and maintenance manuals to Buyer in English, and
will attempt to provide them to Buyer sufficiently in advance of the
installation process to allow Buyer to translate or have them
translated and copied. Seller does not warrant the content of such
documents if translated.
d. Materials
Buyer must send five thousand (5000) of each type of cell to be used
eight (8) weeks before the scheduled shipment date. In addition, at
the time of installation Buyer must have available all required
materials to produce 30 modules including with a minimum two
thousand (2000) solar cells of the type that the system will run in
the initial production configuration
8. Warranty:
Seller sells the Products set forth herein with a Limited Warranty as
shown in Attachment C hereto. It is this Limited Warranty and no other
that shall apply to any claims of defects in parts and/or labor on any
unit of the Products. Seller expressly disclaims any and all other
promises or guarantees that may be purported to apply.
If any defects are found except where limited by the specific terms of
the Limited Warranty, including but not limited to damaged, missing,
substandard or malfunctioning parts and components, the Buyer has the
right to have the Products and/or any of their components repaired
and/or replaced in accordance with the Limited Warranty terms by the
Seller.
9. Product Qualification; Standard for Equipment Acceptance and Completion:
Provided that the Buyer has satisfied its obligations as set forth
herein, Seller will provide performance conditions in accordance with
Attachment D hereto; the "Acceptance Protocol." Such Acceptance
Protocol, signed by both Buyer and Seller prior to shipment shall
demonstrate Seller's equipment meets the applicable specifications for
the acceptance.
In the event that the results of the Acceptance Protocol show that the
Product(s) fail to meet one or more of the performance conditions and
such failure is demonstrably attributable to the Seller, Seller, at no
additional charge to Buyer, shall undertake actions to correct such
defective performance.
The liabilities expressly assumed by Seller under this Agreement shall
be Seller's only liability hereunder, at contract and law, and Buyer
hereby releases Seller from any and all liability and claims of
liability in excess thereof. Seller's total aggregate maximum total
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liability shall be determined jointly by both Parties pursuant to an
analysis of the deficiencies giving rise to any claim by Buyer.
Upon the satisfactory installation and training of Buyer's staff for the
products by Seller, Seller shall issue Acceptance Certificate(s) as in
Attachment F. Should acceptance by Customer in accordance with the
Acceptance Protocol not occur at Spire Solar, or otherwise deferred or
postponed by Customer, or Customer provisionally accepts the Product(s),
Customer's commercial use of the Product(s) for more than sixty (60)
days after installation is completed, or for any thirty day period
thereafter with out execution of the Acceptance Protocol shall be deemed
by both Parties as definitive and final acceptance thereof. All retained
payments shall become immediately due and payable.
10. Indemnity:
Buyer shall indemnify, defend, protect and hold harmless Seller from any
action, suit, complaint, allegation and controversy of whatever kind
which originates in Buyer's operation of the installed Products and the
sale or use of any products that was manufactured using the Products,
provided that Buyer failed to follow all or some portion of the
instructions for use provided by Seller, and provided also that no
portion of the cause has its origin in any act of gross negligence on
the part of Seller.
11. Confidentiality:
Certain matters regarding this relationship embodied by this Agreement
may be considered confidential or sensitive to one or the other Party to
this Agreement. The Parties agree that all such matters, once
identified, will be treated in accordance with the Confidential
Disclosure Agreement attached hereto as Attachment E. This Agreement
does not confer any right of ownership to any technical data disclosed
to Buyer for Process Technology development purposes, and Buyer shall
not release any technical data to any third party without the written
approval of Seller.
12. No License:
This Agreement does not convey any license to Buyer to use Seller's name
or any form of its corporate identification in any jurisdiction. Buyer
is allowed a limited non-exclusive license to use certain technical data
for the purpose of developing process technology.
13. General Provisions:
a. No Waiver - Waiver of any provision of this Agreement, in whole or
in part, in any one instance shall not constitute a waiver of any
other provision in the same instance, or any waiver of the same
provision in any other instance, but each provision shall continue
in full force and effect with respect to any other then-existing or
subsequent breach.
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b. Notice - Any notice required or permitted under this Agreement shall
be given in writing to the Parties at their respective addresses as
specified above, or at such other address for a Party as that Party
may specify by notice (i) by delivery in hand or, (ii) registered or
certified mail, return receipt requested, or courier or some other
form of expedited delivery service that provides for delivery to the
sender of a signed receipt. Notice so sent shall be effective upon
receipt unless otherwise specified herein or in the notice.
c. Arbitration of Disputes - All disputes arising out of or in
connection with this Agreement that cannot be readily or amicably
solved by the Parties shall be finally settled pursuant to the Rules
of Arbitration of the International Chamber of Commerce by three
arbitrators appointed in accordance with said rules. The place of
arbitration shall be the city of New York USA and the arbitration
shall be conducted in the English language.
d. Force Majeure - Neither Party to this Agreement shall be responsible
to the other Party for delays or errors in its performance or other
breach under this Agreement occurring solely by reason of
circumstances beyond its control, including acts of civil or
military authority, national emergencies, fire, major mechanical
breakdown, labor disputes, flood or catastrophe, acts of God,
insurrection, war, riots, severe weather, delays of suppliers, or
failure of transportation, communication or power supply.
e. Miscellaneous - This Agreement: (i) may be executed in any number of
counterparts, each of which, when executed by both Parties to this
Agreement shall be deemed to be an original, and all of which
counterparts together shall constitute one in the same instrument;
(ii) shall be governed by and construed under the laws of The
Commonwealth of Massachusetts applicable to contracts made,
accepted, and performed wholly in The Commonwealth, without
application to the principle of conflict of laws; (iii) except and
to the extent expressly provided for in Article 11, this Agreement
constitutes the entire agreement between the Parties with respect to
its subject matter, superceding all prior oral and written (except
as previously noted) written communications, proposals,
negotiations, representations, understandings, courses of dealing,
agreements, contracts, and the like between the Parties in such
respect; (iv) may be amended, modified, and any right under this
Agreement may be waived in whole or in part, only by a writing
signed by both Parties; (v) contains headings only for convenience,
which headings do not form part, and shall not be used in
construction, of this Agreement; (vi) shall bind and inure to the
benefit of the Parties and their respective legal representatives,
successors and assigns, including, without limitation, to a Parties
corporate parents or affiliates, provides that no Party may delegate
any of its obligations under this Agreement or assign this Agreement
except to a related entity or successor by sale or merger, without
prior written consent of the other party. This Agreement is in the
English language only which language shall be controlling in all
aspects.
f. In the event either Party is in default for sixty (60) days in any
obligation hereunder, and the other Party has given written notice
specifying the claimed
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particulars of such default, which shall continue for a period of
thirty (30) days after the date of such notice, the party giving
notice may thereupon terminate this Agreement forthwith by giving
the other Party ten (10) days written notice of termination. Buyer
shall nevertheless be obligated to pay Seller all payments due
pursuant to Seller's costs to date.
14. United States Export Regulations:
Seller is subject to the Export Regulations of the United States
Department of Commerce and other regulatory agencies that regulate the
export from the United States of certain technical data and information.
Because of these regulations, the Parties to this Agreement recognize
that Seller can furnish such technical data to Buyer only on the
condition that Buyer not re-export the technical data and/or information
to any country to which Seller may not, without a validated export
license, export such data directly. Buyer acknowledges that Buyer is
knowledgeable of such Export Regulations and agrees not to violate them
or take any action or fail to take such action that would allow
technical data and/or information or any product based upon them to be
shipped either directly or indirectly to any country not permitted by
said regulations unless prior written authorization is obtained from the
relevant agencies having jurisdiction over such shipment either directly
or through Seller.
15. Compliance with Laws Generally:
Both Parties agree that they will diligently comply with all relevant
laws, statutes, orders and administrative regulations of all relevant
jurisdictions, at all relevant times. Each Party additionally agrees to
indemnify and hold the other Party harmless from any governmental action
at law that results from the willful or negligent failure of the
indemnifying Party to comply with any relevant law, statute, order or
administrative regulation. The Parties hereby certify that they are, to
the best of their knowledge, compliant with all such laws, statutes,
orders, and administrative regulations.
16. Assignment:
This Agreement shall not be assignable by either party hereto without
the express prior written consent of the other party, except that it may
be assigned without such consent to the successors to and assigns of
substantially the entire assets and business of such party. No
assignment hereof shall be valid without the assumption in writing by
such successors or assigns of all obligations under this Agreement. When
duly assigned in accordance with the foregoing, this Agreement shall be
binding upon and inure to the benefit of the assignee.
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IN WITNESS WHEREOF, the Parties hereto have set their respective hand and seals
signifying their concurrence and endorsement with and of the foregoing, in a
number of counterpart copies, each of which shall be deemed to be an original
for all purposes and deemed effective and binding on the date at the head of
this document.
Uni-CHEM CO. Ltd Spire Corporation
/s/ ▇▇▇▇▇▇ ▇▇▇ /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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By: Hocan ▇▇▇ By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chairman/CEO Title: Chief Operating Officer
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ATTACHMENT A
Letter of Credit (L/C) Requirements
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*** Represents text omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the Securities and Exchange
Commission.
ATTACHMENT B
DATA SHEETS
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*** Represents text omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the Securities and Exchange
Commission.
ATTACHMENT C
STANDARD LIMITED WARRANTY FOR SPIRE EQUIPMENT
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*** Represents text omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the Securities and Exchange
Commission.
ATTACHMENT D
ACCEPTANCE PROTOCOLS
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*** Represents text omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the Securities and Exchange
Commission.
ATTACHMENT E
CONFIDENTIAL DISCLOSURE AGREEMENT
ATTACHMENT F
ACCEPTANCE CERTIFICATES
***
*** Represents text omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the Securities and Exchange
Commission.
1. PASSING OF TITLE AND TRANSFER OF RISK
a) Spire Corporation ("Spire") shall retain ownership of the Products
supplied until full payment has been received. The Customer shall
take all necessary measures for the protection of the proprietary
rights of Spire until such time that all title is legally
transferred to Customer.
b) Title of any part of the Work shall pass to the Buyer upon the date
on which complete (100%) payment for that work has been made by the
Buyer. Any understanding to the contrary is null and void unless
expressly admitted in writing by Spire.
c) Notwithstanding the clause "Termination for Cause", if no specific
Incoterms have been defined herein, then the risk of damage to and
loss and any part of the Work shall pass to the Buyer on the date of
Certification of Ready to Ship.
2. TERMINATION FOR CAUSE
Without prejudice to any other rights of Spire under applicable law:
a) if the Buyer commits a breach of its obligations under this
Contract, which breach is not remedied within a reasonable time
period, the term of which shall be solely determined by Spire, or
b) if the Buyer becomes insolvent or files a petition in bankruptcy or
has such petition filed against it
then Spire may, by written notice, terminate this Contract without
prejudice or any liability of the Buyer under this Contract prior to
such termination.
3. CANCELLATION
a) Prior to shipment, Customer may unilaterally cancel or terminate any
delivery of Products under the Terms and Conditions of Offer with
written notice to Spire and upon payment of cancellation penalties
as follows: if Spire receives Customer's written cancellation notice
i. within 60 days of the scheduled shipment date, cancellation
charges shall be 80% of the applicable order amount, or
applicable fraction thereof.
ii. more than 60 days, but less than 90 days of the scheduled
shipment date, cancellation charges shall be 60% of the
applicable order amount, or applicable fraction thereof.
iii. 90 days or more, but less than 150 days of the scheduled
shipment date, cancellation charges shall be 40% of the
applicable order amount, or applicable fraction thereof.
iv. 150 days or more of the scheduled shipment date, cancellation
charges shall be 35% of the applicable order amount, or
applicable fraction thereof.
4. DELAY IN ACCEPTANCE
Costs that are incurred due to a delay in Product acceptance, which are
not due to any fault or defect in the Spire product itself, must be paid
by the Buyer. Delays of Product acceptance as described above may
require a readjustment of the delivery time in accordance with and
appropriate to the delays of the acceptance of the Product.
5. WARRANTY
Unless stated elsewhere in writing and endorsed in writing by Seller,
the Limited Warranty will last 12 (twelve) months from the date upon
which it became effective ("Effective Date"). The term of this Limited
Warranty begins with the earliest occurrence of the following events,
which shall define as the Effective Date of the Limited Warranty:
a) the day after the conclusion of the successful Factory Acceptance
Test (or any equivalent event) of the Product covered by this
Limited Warranty; or
b) sixty-one (61) days after arriving at Buyer's site, if the Factory
Acceptance Test has not commenced prior to that date as a result of
Buyer's actions for any reason; or
c) sixty-one (61) days from the date of Seller's notice to Buyer of
"Certificate-Product Ready to Ship", if the failure to ship prior to
that date is due to Buyer's delay for any reason, or
d) the date upon which the Product is first used in commercial
production.
i. "commercial production" shall be defined as the use of Product
to manufacture goods for commercial sale.