Amended And Restated License And Technology Transfer Agreement

EXHIBIT 10.18


CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted pursuant to a request for confidential treatment and, where applicable, have been marked with an asterisk ("[****]") to denote where omissions have been made. The confidential material has been filed separately with the Securities and Exchange Commission.


AMENDED AND RESTATED


LICENSE &


TECHNOLOGY TRANSFER


AGREEMENT


BY AND BETWEEN


EVERGREEN SOLAR, INC.


AND


EVERQ GMBH


TABLE OF CONTENTS


ARTICLE 1 DEFINITIONS
1.1 CONSTRUCTION
1.2 DEFINITIONS


ARTICLE 2 RIGHTS AND LICENSES
2.1 E LICENSE GRANT TO VENTURECO
2.2 VENTURECO LICENSE GRANT TO E
2.3 RESERVATION OF RIGHTS; NO IMPLIED LICENSES


ARTICLE 3 TECHNOLOGY TRANSFER
3.1 QUARTERLY MEETINGS
3.2 DELIVERY OF TECHNICAL DELIVERABLES
3.3 COPIES
3.4 [****]


ARTICLE 4 CONSIDERATION AND PAYMENT
4.1 ROYALTY
4.2 ROYALTY EVALUATION BY EXPERTS
4.3 TAX AUTHORITY CHALLENGES
4.4 ROYALTY CALCULATIONS
4.5 PAYMENT
4.6 CURRENCY
4.7 TAXES
4.8 AUDIT
4.9 SEPARATE AGREEMENTS
4.10 PROSPECTIVE BASIS
4.11 WAIVER


ARTICLE 5 INTELLECTUAL PROPERTY RIGHTS
5.1 OWNERSHIP
5.2 ENFORCEMENT OF JOINTLY OWNED INTELLECTUAL PROPERTY RIGHTS
5.3 THIRD PARTY LICENSES
5.4 FURTHER COOPERATION


ARTICLE 6 WARRANTIES
6.1 REPRESENTATIONS AND WARRANTIES
6.2 REMEDY
6.3 DISCLAIMER


September 28 06 FINAL


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TABLE OF CONTENTS


ARTICLE 7 CONFIDENTIAL INFORMATION
7.1 CONFIDENTIAL INFORMATION


ARTICLE 8 TERM
8.1 TERM
8.2 SPECIAL TERMINATION RIGHT
8.3 EFFECT OF TERMINATION


ARTICLE 9 GENERAL PROVISIONS
9.1 LIMITATION OF LIABILITY
9.2 NOTICES
9.3 LANGUAGE
9.4 AMENDMENTS AND WAIVERS
9.5 ASSIGNMENT
9.6 ENTIRE AGREEMENT; SEVERABILITY
9.7 OTHER REMEDIES; SPECIFIC PERFORMANCE
9.8 GOVERNING LAW AND DISPUTE RESOLUTION
9.9 COMPLIANCE WITH LAWS AND REGULATIONS
9.10 EXPORT
9.11 FORCE MAJEURE
9.12 INDEPENDENT CONTRACTORS
9.13 THIRD PARTY BENEFICIARIES
9.14 COUNTERPARTS
9.15 CONDITION


September 28 FINAL


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AMENDED AND RESTATED
LICENSE &
TECHNOLOGY TRANSFER
AGREEMENT


This Amended and Restated License & Technology Transfer Agreement (this "AGREEMENT") is made by and between Evergreen Solar, Inc., a Delaware corporation ("E"), and EverQ GmbH, a limited liability company (GmbH), incorporated under the laws of the Federal Republic of Germany ("VENTURECO" or "EverQ"), as of the Effective Date. E and VentureCo are hereinafter referred to individually by their respective names or as "PARTY" and collectively as "PARTIES."


RECITALS:


WHEREAS, E, Q Cells AG ("Q") and Renewable Energy Corporation ("REC") have entered into that certain Master Joint Venture Agreement (Notarial Deed nr. 287/2005 of the Berlin notary public Dr. Rudolf von Hanstein, the "MASTER AGREEMENT") which is deemed to be incorporated into this Agreement where this Agreement refers to the Master Agreement (and remains incorporated notwithstanding termination of the Master Agreement), pursuant to which, among other things, the Parties have agreed to enter this Agreement;


WHEREAS, Q and VentureCo have entered into that certain License and Technology Transfer Agreement By and Between Q-Cells AG and EverQ GmbH (the "Q LICENSE AGREEMENT");


WHEREAS, REC and VentureCo have entered into that certain License and Technology Transfer Agreement By and Between Renewable Energy Corporation and EverQ GmbH (the "REC LICENSE AGREEMENT");


WHEREAS, E and VentureCo have entered that certain License & Technology Transfer Agreement ("PRIOR AGREEMENT");


WHEREAS, E and VentureCo wish to amend the Prior Agreement and agree that this Agreement shall supersede and replace the Prior Agreement;


NOW, THEREFORE, in consideration of the foregoing premises and the representations, warranties, covenants and agreements herein contained, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and accepted, and intending to be legally bound hereby, the Parties hereto hereby agree as follows:


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ARTICLE 1


DEFINITIONS


1.1 Construction. Capitalized terms not defined herein shall have the meanings set forth in the Master Agreement. The interpretation of this Agreement shall be governed by those principles set forth in SECTION 1.2 (Headings and Other Interpretation) of the Master Agreement.


1.2 Definitions. As used herein:


"ADDED VALUE" means increased value through sale of a Licensed Product attributable to [****] incorporated into or used to manufacture that Licensed Product, for example, [****]. The "Added Value" is determined by comparison of [****].


"DIRECT PRODUCTION COSTS" means all [****] required for the production of a Licensed Product, and [****] associated with manufacturing a Licensed Product incorporating MNIP.


"COST SAVINGS" means the aggregate reduction of Total Production Costs of a Licensed Product attributable to [****] incorporated into or used to manufacture that Licensed Product. Any change in yields and conversion efficiencies shall be taken into account in determining the "Cost Savings." The "Cost Savings" is determined by comparison of [****] in manufacture of the Licensed Products, or determined by comparison to another agreed [****]. If royalty payments are based on a royalty determined under Section 4.1(f) (Alternative Royalty Rate Calculation Based on MNIP), then each quarter the "Cost Savings" will be calculated by comparing [****] to the agreed [****]. The mechanism for defining such [****] will not change during the term of the royalty payments, but the [****].


"EFFECTIVE DATE" means [****].


"E IP" means the E Technology and E Intellectual Property Rights.


"E INTELLECTUAL PROPERTY RIGHTS" means all Intellectual Property Rights owned or Licensable by E or its Affiliates during the Initial Period and (with respect to certain MNIP and other Intellectual Property Rights as described in this Agreement) [****] Post Termination Period, that relate to the manufacture, production, assembly, use or sale of Licensed Products, or which would, without the licenses herein, be infringed or violated by the operation of VentureCo's business or its commercialization of products as contemplated in the Master Agreement. "E INTELLECTUAL PROPERTY RIGHTS" includes those Intellectual Property Rights listed in PART 1 OF EXHIBIT A and (once available for commercial use), in PART 2 OF EXHIBIT A but excludes those Intellectual Property Rights listed in PART 3 OF EXHIBIT A ("EXCLUDED E INTELLECTUAL PROPERTY RIGHTS"). For the avoidance of doubt, "E INTELLECTUAL PROPERTY RIGHTS" excludes (i) MNIP offered to VentureCo but which it has elected not


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to license, (ii) other Intellectual Property Rights for improvements or other inventions that are made after the [****] Post Termination Period (except to the extent regulated in the context of support services to VentureCo pursuant to an applicable agreement), and (iii) in the event of an acquisition of E, Intellectual Property Rights of the acquirer of E.


"E TECHNICAL DELIVERABLES" means any reasonably available documentation, records and other tangible items constituting E Technology and E Intellectual Property Rights, including any such items specified in Part 1 of Exhibit A.


"E TECHNOLOGY" means all Technology owned or Licensable by E or its Affiliates during the Initial Period and (with respect to certain MNIP and other Technology as described in this Agreement) [****] Post Termination Period, that relates to the manufacture, production, assembly, use or sale of Licensed Products and the operation of VentureCo's business and commercialization of products as contemplated in the Master Agreement. "E TECHNOLOGY" includes Technology relating to items described in PART 1 OF EXHIBIT A ("INCLUDED E TECHNOLOGY") and (once available for commercial use) relating to MNIP described in PART 2 OF EXHIBIT A, but excludes Technology relating to items described in PART 3 OF EXHIBIT A ("EXCLUDED E TECHNOLOGY"). For the avoidance of doubt, E Technology excludes (i) MNIP offered to VentureCo but which it has elected not to license, (ii) other Technology created after the [****] Post Termination Period (except to the extent regulated in the context of support services to VentureCo pursuant to an applicable agreement), and (iii) in the event of an acquisition of E, Intellectual Property Rights of the acquirer of E.


"EXCLUDED E TECHNOLOGY" has the meaning set forth in SECTION 1.2 (Definitions - E Technology).


"INITIAL PERIOD" means the time period commencing on the License Effective Date and ending on the Termination Date.


"INTELLECTUAL PROPERTY RIGHTS" means all rights in, to, or arising out of: (i) any Patents; (ii) inventions, discoveries (whether patentable or not in any country), invention disclosures, improvements, trade secrets, proprietary information, know-how, technology and technical data; (iii) copyrights, copyright registrations, mask works, mask work registrations, and applications therefor in any country, and all other rights corresponding thereto throughout the world; and (iv) any other proprietary rights in or to Technology anywhere in the world.


"JOINTLY OWN" has the meaning set forth in SECTION 5.1(a)(i) (Definition).


"LICENSABLE" means possession of the ability to grant a license or sublicense of, or within, the scope provided for in this Agreement without payment of any fee to, or violating the terms of any agreement or other arrangements with a Third Party and without violating any applicable laws, rules or regulations.


"LICENSE EFFECTIVE DATE" means the Effective Date.


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"LICENSED PRODUCTS" means Wafers, Cells, and/or Modules, as the case may be, in which the Wafers are made using String Ribbon Technology.


"LICENSED PRODUCTS REVENUE" means the cumulative Net Sales Price for all Licensed Products Sold in the respective period.


"MARKET RATE" means [****].


"MATERIAL NEW IP" or "MNIP" means Intellectual Property Rights and Technology developed or Licensable by E only after the License Effective Date [****]. Notwithstanding anything to the contrary, MNIP shall not include any Excluded E Intellectual Property Rights or, in the event of an acquisition of E, Intellectual Property Rights of the acquirer of E. In general Intellectual Property Rights and Technology that are legally protectible and reduce Total Production Costs of Licensed Products by, or provide an Added Value of, [****]; provided, however, that MNIP may include Property Rights and Technology not meeting such criteria to the extent that it nevertheless provides a substantial and material benefit.


"NET SALES PRICE" means, (i) for arm's length Sales for fair value, the average gross revenue received by VentureCo in the period for Sales of the Licensed Products, accounted for in accordance with generally accepted accounting principles, less any deduction for discounts, returns, freight, insurance, taxes, and duties and (ii) for Sales other than arm's length Sales for fair value, the greater of (a) the net average selling price of the same or most nearly same Licensed Product and (b) the average gross revenue for such Sales less any deduction for discounts, returns, freight, insurance, taxes, and duties in accordance with generally accepted accounting principles.


"PATENTS" means any German, international or foreign patent or any application therefor and any and all reissues, divisions, continuations, renewals, extensions and continuations-in-part thereof.


"POST TERMINATION PERIOD" means the time period commencing immediately after the Termination Date. "[****] POST TERMINATION PERIOD" means the [****] period commencing immediately after the Termination Date.


"REGISTERED E INTELLECTUAL PROPERTY RIGHTS" means all E Intellectual Property Rights (including Patents) that have been registered, filed, issued or otherwise perfected or recorded with or by any state, government or other public or quasi-public legal authority, including any applications for filings for any such rights.


"SOLD" or "SELL" means any direct or indirect disposition, by sale, lease, use or otherwise, of a Licensed Product.


"STRING RIBBON" means [****].


"TECHNOLOGY" means information and technology in tangible and/or intangible form and materials, embodiments, implementations or improvements of any technology, including, but not limited to: software, media, data collections, databases, techniques, methods, processes, formulae,


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systems, hardware, equipment, prototypes, proofs of concept, apparatuses, hardware, software, algorithms, files, routines, documents, designs, drawings, plans, specifications and the like.


"TERMINATION DATE" means the earlier of the date on which the Master Agreement or this Agreement is terminated in accordance with its terms.


"TOTAL PRODUCTION COSTS" means the total of the [****] and [****] to the extent such [****] is directly associated with the respective product.


"VENTURECO INTELLECTUAL PROPERTY RIGHTS" means all Intellectual Property Rights developed and owned (solely or jointly) by VentureCo that relate to or which would, without the licenses set forth herein, be infringed or violated by making, using, selling, importing or otherwise exploiting Wafers, Cells and Modules.


"VENTURECO IP" means VentureCo Technology and VentureCo Intellectual Property Rights.


"VENTURECO TECHNOLOGY" means all technology developed and owned (solely or jointly) by VentureCo that relates to the making, using, selling, importing or other exploiting Wafers, Cells and Modules.


ARTICLE 2


RIGHTS AND LICENSES


2.1 E License Grant to VentureCo. Subject to the terms and conditions of this Agreement, E hereby grants and agrees to grant to VentureCo, effective upon the License Effective Date, a world-wide, non-exclusive, non-transferable, perpetual, irrevocable, fully paid up and royalty-free (except as provided in ARTICLE 4 (Consideration and Payment)) license, without the right to sublicense, under the E Intellectual Property Rights, to make (but not have made), use, sell, offer for sale, import or otherwise commercialize or exploit Licensed Products, to use the E Technology in connection with the foregoing, and to otherwise operate VentureCo and commercialize its products as contemplated in the Master Agreement. It is understood that the foregoing license to VentureCo includes, without limitation, the right to change and make improvements and extensions to the E Technology. Furthermore, it is understood that VentureCo shall have the right to commercially exploit such changes and improvements in accordance with such license.


2.2 VentureCo License Grant to E. VentureCo hereby grants and agrees to grant to E a world-wide, non-exclusive, non-transferable (except pursuant to SECTION 9.5 (Assignment)), perpetual, irrevocable, fully paid up, royalty-free, fully sublicensable, license, under the VentureCo Intellectual Property Rights developed in the Initial Period and [****] Post Termination Period, to make, use, sell, offer for sale, import or otherwise commercialize or exploit Wafers, Cells and Modules. In addition, VentureCo hereby grants and agrees to grant to E a world-wide, non-exclusive, non-transferable, perpetual, irrevocable, fully paid up, royalty-free, fully sublicensable,


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license, under the VentureCo Intellectual Property Rights, whenever developed, [****] to make, use, sell, offer for sale, import or otherwise commercialize or exploit Wafers, Cells and Modules. It is understood that the foregoing license to E includes, without limitation, the right for E to change and make improvements and extensions to such Technology licensed from VentureCo. Furthermore, it is understood that E shall have the right to commercially exploit said changes and improvements in accordance with such license.


2.3 Reservation of Rights; No Implied Licenses. All rights not granted herein are reserved. Nothing in this Agreement shall be deemed to constitute the grant of any license or other right to a Party's Intellectual Property Rights or Technology except as expressly set forth herein.


ARTICLE 3


TECHNOLOGY TRANSFER


3.1 Quarterly Meetings.


(a) New Developments. During the Initial Period and [****] Post Termination Period, the Parties shall meet on a quarterly basis (or as otherwise agreed upon by the Parties) to discuss (and E shall advise VentureCo of) any material or other E IP or VentureCo IP that was acquired, developed or became Licensable since the prior quarterly meeting.


(b) Defining Material New IP. During the quarterly meetings described above, the Parties shall also determine whether new Intellectual Property Rights and Technology of or Licensable by E comprise Material New IP. The Parties intend that if E develops MNIP, it may be appropriate for E to receive royalty for VentureCo's use thereof (and whichVentureCo has elected to acquire) in accordance with ARTICLE 4 (Consideration and Payment). The Parties' obligations with respect to MNIP will be governed by ARTICLE 4 (Consideration and Payment).


3.2 Delivery of Technical Deliverables. E shall deliver to VentureCo at least one copy of all E Technical Deliverables, in electronic form when practicable, within [****] days after the License Effective Date or (as applicable),


(a) in the case of MNIP listed in EXHIBIT A PART 2, promptly upon commercial availability (subject to applicable royalties),


(b) in the case of MNIP available in the Initial Period (other than that in EXHIBIT A PART 2), promptly after VentureCo's election to acquire that MNIP (subject to applicable royalties), and


(c) in the case of MNIP available after the E Interest Reduction Date or Termination Date, promptly after VentureCo's election to acquire that MNIP and determination of applicable royalties.


Subject to ARTICLE 4 (Consideration and Payment), during the Initial Period and the [****] Post Termination Period, E shall periodically and promptly deliver to VentureCo copies of E


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Technical Deliverables that have not been previously delivered, including E Technical Deliverables relating to E IP acquired or Licensable after the License Effective Date.


3.3 Copies. VentureCo may copy, modify and otherwise use the E Technical Deliverables in accordance with and subject to the restrictions and licenses set forth herein as necessary to exercise the rights granted hereunder. VentureCo agrees to maintain a document control system to control copies of such E Technical Deliverables and otherwise treat such information as E's Confidential Information subject to the provisions of ARTICLE 7 (Confidential Information).


3.4 [****


(a) ****


(b) ****


(c) ****


(d) ****]


ARTICLE 4


CONSIDERATION AND PAYMENT


4.1 Royalty. Subject to exceptions in this Agreement, VentureCo shall pay royalties to E for the use of MNIP. The royalty shall be based on two main elements: the success of the relevant MNIP in achieving Cost Savings and the success of that MNIP in achieving Added Value, [****]. For the sake of commercial simplicity the product of the two base rate elements shall be converted into a combined royalty rate, at intervals specified in relevant Sections below. The detailed rules of royalty calculation, including exceptions, follow below.


The royalty and other fees (if any) (collectively "ROYALTY") payable for the use of MNIP shall be [****] generally determined as set forth below. The royalty payment obligations commence (with respect to Licensed Products Sold incorporating that MNIP) the later of (1) January 1 2007, and (2) the date when VentureCo first Sells Licensed Products that incorporate that MNIP.


For purposes of this Agreement, Thin Ribbon Technology (as described in Exhibit A, part [2] item [2], will be deemed MNIP.


(a) Royalty Rate in General. The royalty rate applicable hereunder ("Royalty Rate") shall be as set forth in the following table shall continue until [****] ("Royalty Renewal Date").


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Licensed Product Revenue Royalty Rate - ------------------------ ------------ $0 to $100 million 5% $100 million to $250 million 3.5% $250 million to $1,000 million 2% more than $1,000 million 1%


(b) Annual Adjustments. The Royalty Rate may be adjusted on annual basis as follows. While Annual Adjustments may be made as set forth below, in making such adjustments, the Parties shall give deference to the above rates, and any adjustments shall made primarily to account for changes after the above rates were established. At least [****] days in advance of the [****] of the Royalty Renewal Date, the Parties shall agree upon a new market based Royalty Rate that shall be applicable for the next [****] year period commencing on the [****] of the Royalty Renewal Date. In the event that VentureCo and E cannot agree on the Royalty Rate applicable to such next [****] year period, or at the election of either VentureCo and E, the Royalty Rate for currently used MNIP shall be determined in accordance with Section 4.1(f) (Alternative Royalty Rate Calculation Based on MNIP).


(c) Exceptional Adjustments. The Royalty Rate may be modified before the annual adjustment of Section 4.1(b) (Annual Adjustments) at the request of either party as set forth below in Section 4.1(c)(i) (Performance) or Section 4.1(c)(ii) (Compared to Conventional Silicon).


(i) Performance. In the event that the performance of the MNIP used by VentureCo differs substantially from the performance anticipated at the time the Royalty Rate was determined in accordance with 4.1(b) (Annual Adjustments), the Royalty Rate may be modified in accordance with this Section 4.1(c) (Exceptional Adjustments) to reflect this unexpected performance. For a difference in performance to merit a change of Royalty Rate under this section 4.1 (c) (Exceptional Adjustments), the change would comprise [****].


(ii) Compared to Conventional Silicon. [****].


(iii) New Royalty Rate. In the event that a change in Royalty Rate is requested and the change in Royalty Rate is merited based on Section 4.1(b)(i) (Performance) or Section 4.1(b)(ii) (Compared to Conventional Silicon), Parties agree to negotiate in good faith to determine the new applicab ...