합자투자기업

JOINT VENTURE AGREEMENT THIS JOINT VENTURE AGREEMENT is made in Seoul, Korea on this _______ day of ________, 1999 by and between [ABC Inc.], a corporation organized and existing under the laws of Korea and having its principal office at ABC __________________________________(“ ABC” ), and [insert XYZ name], a corporation organized and existing under the laws of _____________ and having its principal office at ______________________________ (“ XYZ” ). WHEREAS, ABC and XYZ desire to establish a joint venture company (the “ JVC “ ) in Korea for the purpose of designing, manufacturing, installing, exporting, distributing, and providing maintenance services for, product 1, product 2, product 3 and product 4; and WHEREAS, ABC and XYZ wish to establish the principles under which the JVC will be set up and operated; NOW, THEREFORE, in consideration of the mutual promises and covenants contained in this Agreement, ABC and XYZ agree as follows: SECTION 1 DEFINITIONS Unless the terms or context of this Agreement otherwise provides, the following terms shall have the meanings set out below: 1.1 “ Acceptance Period “ shall have the meaning given to the term in Section 6.9(b). 1.2 An “ Affiliate “ of any Party to this Agreement shall mean any corporation, person, firm or other entity which, directly or indirectly, controls said Party or is controlled by said Party or is under common control with said Party, where “ control” means power and ability to direct the management and policies of the controlled enterprise through ownership of or control by proxy of twenty percent (20%) or more of voting shares of the controlled enterprise or by contract or otherwise. For the avoidance of doubt, the JVC and a subsidiary of the JVC shall not be an Affiliate of any Party to this Agreement. 1.3 “ Agreement “ shall mean this agreement to form the JVC. 1.4 “ Annual Audit “ shall have the meaning given to the term in Section 13.4. 1.5 “ Articles of Incorporation “ shall mean the Articles of Incorporation of the JVC. 1.6 “ Board “ shall mean the Board of Directors of the JVC. 1.7 “ Business” shall have the meaning given to such term in Section 8. 1.8 “ BTA ” shall mean a Business Transfer Agreement to be entered into between the JVC and ABC Systems Co., Ltd. (“ ABCS” ) providing for the transfer of the Business to the JVC in the form attached hereto as Attachment 1.8. 1.9 “ Designee” shall have the meaning given to the term in Section 6.9(b). 1.10 “ First Closing Date” shall have the meaning given to the term in Section 6.3.1. 1.11 “ Fifth Anniversary Date” shall mean the date that is five (5) years from the Second Closing Date. 1.12 “ Force Majeure” shall have the meaning given to the term in Section 19.1(a). 1.13 “ Free Sale Period” shall have the meaning given to the term in Section 6.9(b). 1.14 “ Government Approval” shall mean all approvals and notifications required under the laws of the relevant jurisdiction to be obtained and/or made in connection with the execution and performance of this Agreement, or the consummation of the transactions contemplated hereunder. 1.15 “ HNRP Policies” shall have the meaning given to the term in Section 14.6. 1.16 “ ICC” shall have the meaning given to the term in Section 21.1. 1.17 “ Independent Auditor” shall have the meaning given to the term in Section 15.2(a). 1.18 “ Joint Venture Term” shall mean the term of the JVC as set forth in Section 4 hereof. 1.19 “ Korea” shall mean the Republic of Korea. 1.20 “ Korean GAAP” shall mean generally accepted accounting principles in Korea, in effect from time to time. 1.21 “ Management Personnel” shall mean the Representative Director and such other personnel designated as Management Personnel by the Board. 1.22 “ Offeree Party” shall have the meaning given to the term in Section 6.9(b). 1.23 “ Option Price” shall have the meaning given to the term in Section 6.7(a). 1.24 “ Party” or “ Parties” shall mean either ABC or XYZ individually, or if plural, both collectively. 1.25 “ Payment Deadline” shall have the meaning given to the term in Section 6.7(a). 1.26 “ Products” shall have the meaning given to the term in Section 5. 1.27 “ Proprietary Information” of a Party or the JVC shall mean such technical, engineering, economic, marketing, financial, other information or know–how as may be developed by or owned by a Party or the JVC, which is beneficial to the business of a Party or Business of the JVC, and such other like information as is generally treated as confidential by that Party or the JVC. 1.28 “ Related Agreements” shall mean the BTA, an XYZ Trade Name and Trademark License Agreement to be entered into between the JVC and XYZ, and an ABC Trade Name and Trademark License Agreement to be entered into between the JVC and ABC. 1.29 “ Second Closing Date” shall have the meaning given to the term in Section 6.3.2. 1.30 “ Selling Party” shall have the meaning given to the term in Section 6.9(b). 1.31 “ Signing Date” shall mean the date this Agreement is executed by the Parties. 1.32 “ Tenth Anniversary Date” shall mean the date that is ten (10) years from the Second Closing Date. 1.33 “ United States Dollars” , “ U.S. Dollars” and “ US$” shall mean the lawful currency of the United States of America. 1.34 “ Won” and “ KRW” shall mean the lawful currency of Korea. 1.35 “ Working Personnel” shall mean the employees of the JVC other than Management Personnel. SECTION 2 PARTIES TO THE AGREEMENT 2.1 The Parties to this Agreement are ABC and XYZ. 2.2 Where references are made in this Agreement to “ the two Parties” , “ each Party” , “ either Party” , “ neither Party” , “ the other Party” , “ both Parties” or other phrases indicating only two parties, the two parties thus referred to shall be XYZ and ABC, unless otherwise clearly indicated by the context. SECTION 3 ESTABLISHMENT OF THE JOINT VENTURE COMPANY 3.1 Establishment of the JVC The Parties hereby agree to initiate all actions necessary to establish the JVC promptly after the Signing Date. 3.2 Name and Address of the JVC; Branches (a) Name. The name of the JVC shall be _____________ in English and _____________ in Korean. The use of the name “ ABC” or “ XYZ” as part of the JVC name shall be subject to the Trade Name and Trademark License Agreements between (i) the JVC and ABC and (ii) the JVC and XYZ. (b) Address. The legal address of the JVC shall be __________, Korea, or such other address determined by the Board. (c) Branches. The JVC may establish subsidiaries, branches or representative offices in Korea or elsewhere by a resolution of the Board and approval from any relevant governmental authorities. 3.3 Limited Liability Company (a) The form of organization of the JVC shall be a limited liability company established under Korean law in the form of a ______ Hoesa. (b) Except as otherwise provided herein, once a Party has paid in full its contribution in accordance with Section 6.3, it shall not be required to provide any further funds to, or on behalf of, the JVC by way of capital contribution, loan, advance, guarantee or otherwise. Except as otherwise provided pursuant to a written agreement signed by the Party to be charged, creditors of the JVC shall have recourse only to the assets of the JVC and shall not seek repayment from any of the Parties. Subject to this Agreement and the Related Agreements, the JVC shall indemnify the Parties against any and all losses, damages or liability suffered by the Parties in respect of third-party claims arising out of the operation of the JVC. Subject to the above, the profits, risks and losses of the JVC shall be shared by the Parties in proportion to their respective contributions to the JVC’s paid-in capital. (c) The principles of the governance of the JVC are set forth in this Agreement and in the Articles of Incorporation attached hereto as Attachment 3.3. In the event of any inconsistency or conflict between this Agreement and the Articles of Incorporation, the provisions of this Agreement shall prevail, and the Parties hereto agree to use their respective voting powers in the JVC and to do all that is necessary to amend the Articles of Incorporation so as to make the same consistent with and to give effect to the terms and conditions of this Agreement. SECTION 4 JOINT VENTURE TERM The Joint Venture Term of the JVC shall commence on the First Closing Date and shall be perpetual, subject to the termination rights stated in Section 18 below. SECTION 5 THE PURPOSE AND SCOPE OF OPERATION The purpose and scope of the JVC is to (i) design, manufacture, install, export, distribute, and provide maintenance services for, product 1, product 2, product 3 and product, as they are more particularly listed in Attachment 5 hereto (collectively, the “ Products” ), and (ii) engage in all other activities which are directly or indirectly related, incidental or conducive to the attainment of the foregoing purposes. SECTION 6 TOTAL AMOUNT OF INVESTMENT AND PAID-IN CAPITAL 6.1 Total Investment The total amount of investment (paid-in capital and borrowed funds) required by the JVC shall be ____________ Won. 6.2 Paid-in Capital The total amount of the JVC’s paid-in capital shall be ________________ Won. 6.3 Contributions to Paid-in Capital 6.3.1 First Closing On a date (the “ First Closing Date” ) to be agreed on by the Parties, but within ______ days after all conditions precedent to the First Closing as set forth in Section 6.4.1 are met, the Parties shall take the following actions: (a) Initial Share Subscription (i) XYZ. XYZ shall subscribe for ________ shares of which the par value in the aggregate shall be _________________________ (_______________) Won, representing seventy-five percent (75%) of the paid-in capital of the JVC. (ii) ABC. ABC shall subscribe for ________ shares of which the par value in the aggregate shall be _________________________ (_______________) Won, representing twenty-five percent (25%) of the paid-in capital of the JVC. (b) The JVC shall deliver to each Party the stock certificates representing the respective shares to be issued in accordance with Section 6.3.1(a) above. (c) The JVC shall record each Party on its share registers as a holder of the shares so issued. (d) Each Party shall sign a Related Agreement as it pertains to that Party, and shall cause ABCIS and the JVC to sign the BTA. As a result of the completion of the First Closing, the Parties shall hold the following proportion of the total issued shares of the JVC: XYZ: seventy-five percent (75%) ABC: twenty-five percent (25%) 6.3.2 Second Closing On a date (the “ Second Closing Date” ) to be agreed on by the Parties, but at least ______ days before the closing under the BTA occurs after all conditions precedent to the Second Closing as set forth in Section 6.4.2 are met, the Parties shall take the following actions: (a) Additional Share Subscription (i) XYZ. XYZ shall subscribe for ________ shares of which the par value in the aggregate shall be _________________________ (_______________) Won, representing seventy-five percent (75%) of the paid-in capital of the JVC. (ii) ABC. ABC shall subscribe for ________ shares of which the par value in the aggregate shall be _________________________ (_______________) Won, representing twenty-five percent (25%) of the paid-in capital of the JVC. (b) The JVC shall deliver to each Party the stock certificates representing the respective shares to be issued in accordance with Section 6.3.2(a) above. (c) The JVC shall record each Party on its share registers as a holder of the shares so issued. As a result of the completion of the Second Closing, the Parties shall hold the following proportion of the total issued shares of the JVC: XYZ: seventy-five percent (75%) ABC: twenty-five percent (25%) 6.4 Conditions Precedent to Closing 6.4.1 Conditions Precedent to the First Closing (a) XYZ shall have reported the foreign investment under the Foreign Investment Promotion Law; and (b) XYZ and ABC shall each have obtained acceptance by the Korean Fair Trade Commission of a business combination report under the Monopoly Regulation and Fair Trade Law. 6.4.2 Condition Precedent to the Second Closing All conditions precedent to the Closing (as defined in the BTA) as set forth in Section 9 of the BTA shall have been met. 6.5 Either Party may designate an Affiliate to subscribe for some or all of the shares it is permitted to acquire in the JVC pursuant to Section 6.3 above, provided that, as a condition to the validity of such designation, the Party shall procure from the designated Affiliate, a written undertaking to the other Party and the JVC agreeing to be bound by all provisions of this Agreement, as if it had executed this Agreement in place of the Party by which it has been designated. In addition, the Party making such designation unconditionally guarantees, to and for the benefit of the other Party and the JVC, that it will secure complete and timely observance of the provisions of this Agreement by such designated Affiliate. Any such designation shall be subject to Government Approval, if Government Approval is required. 6.6 Additional Financing or Investment (a) Borrowed Funds. Additional funds other than the paid-in capital may be borrowed by the JVC by means of intercompany loans or from banks in Korea or abroad, subject to the approval of the Board. For the avoidance of doubt, no Party shall have any obligation, and nothing in this Agreement shall be construed as obligating any Party, to provide such additional funds to, or on behalf of, the JVC by way of intercompany loan, advance, guarantee or otherwise, except and to the extent as expressly provided for in Section 6.3 above. (b) Additional Contributions. Should the JVC require further funding after the Second Closing Date, the Parties shall, subject to the decision of the Board, and in accordance with the ratio of their respective contributions to the paid-in capital, consider additional investment in the paid-in capital of the JVC. The specific timing, amounts and form of such additional investment shall be decided by the Board based upon the JVC’s financial requirements. If the Board determines that additional paid-in capital is required, and a Party elects not to participate in the contribution of such additional capital, the other Party may make such contributions it deems appropriate, and the Board shall allocate to the contributing Party such additional shares as correspond to the amount of its contribution, and the non-contributing Party’s percentage of total capital shall be reduced correspondingly on a pro-rata basis; provided that, XYZ acknowledges and agrees that, notwithstanding any provision to the contrary contained herein, (i) ABC’s shareholding ratio in the JVC may fall below 25% (25% being referred to as “ ABC’s Shareholding Ratio” ) at any time prior to the Fifth Anniversary Date by reason of an election by ABC under this subsection not to participate in the contribution of any additional capital after the Second Closing Date, and (ii) none of ABC’s rights and benefits under this Agreement shall be altered, diminished, limited or otherwise restricted whatsoever even if ABC’s Shareholding Ratio is reduced for whatever reason (including its election not to participate in the contribution of any additional capital) at any time after the Second Closing Date. 6.7 Put Options (a) Between the Fifth Anniversary Date and the Tenth Anniversary Date. At any time from and after the Fifth Anniversary Date but before the Tenth Anniversary Date, ABC, at its option and from time to time, shall have the right to sell, in any single transaction or series of transactions, part of its shares in the JVC, to XYZ or a third party designated by XYZ at a price determined in accordance with the formulas set forth in Attachment 6.7 (the “ Option Price” ), subject to the condition that ABC’s then shareholding ratio after the consummation of each put option hereunder is _____ percent (__%) or more of the total issued shares of the JVC during such period; provided that in case ABC’s Shareholding Ratio is reduced after the Second Closing Date by reason of its election not to participate in the contribution of any additional capital under Section 6.6(b) above, then the minimum shareholding ratio that ABC will be required to maintain between the Fifth and Tenth Anniversary Dates for purposes of exercising a put option hereunder shall be computed by multiplying ABC’s then shareholding ratio by the above percentage, divided by ABC’s Shareholding Ratio. ABC may exercise each put option hereunder by giving a written notice to XYZ (or to a third party designated by XYZ and copied to XYZ), setting forth, among other things, the number of shares to be sold. A contract for the purchase and sale of the shares shall be deemed have been entered into upon the delivery of the written notice to XYZ (or to a third party designated by XYZ and copied to XYZ), and payment of the Option Price for such shares shall be due within thirty (30) days after such delivery (the “ Payment Deadline” ). After the Payment Deadline, interest shall accrue on the Option Price at a rate of 0.05% per day. (b) After the Tenth Anniversary Date. At any time after the Tenth Anniversary Date, ABC may freely sell, in any single transaction or series of transactions, all or part of the remaining shares of the JVC to XYZ or a third party designated by XYZ at the Option Price by giving a written notice in a manner consistent with subsection (a) above. A contract for the purchase and sale of the shares shall be deemed have been entered into upon the delivery of the written notice to XYZ (or to a third party designated by XYZ and copied to XYZ), and payment of the Option Price for such shares shall be due on or before the Payment Deadline. After the Payment Deadline, interest shall accrue on the Option Price at a rate of 0.05% per day. 6.8 Initial Public Offering and Listing of the JVC Shares The Parties shall use their best efforts to cause the JVC, and the JVC shall use its best efforts, to have its shares listed on a recognized stock exchange (or to have its shares registered for trading in the over-the-counter market) as soon as possible after the Fifth Anniversary Date. Once such listing or registration occurs, ABC may sell its shares in the JVC either on the stock exchange, on the over-the-counter market or through private transactions. ABC may (i) sell, in a single transaction or series of transactions, part of its shares in the JVC on the stock exchange or over-the-counter market without the Section 6.9 restrictions, subject only to the condition that ABC’s then shareholding ratio after the consummation of each such sale is _____ percent (__%) or more of the total issued shares of the JVC between the Fifth and Tenth Anniversary Dates; provided that in case ABC’s Shareholding Ratio is reduced after the Second Closing Date by reason of its election not to participate in the contribution of any additional capital under Section 6.6(b) above, then the minimum shareholding ratio that ABC will be required to maintain between the Fifth and Tenth Anniversary Dates for purposes of this Section shall be computed by multiplying ABC’s then shareholding ratio by the above percentage, divided by ABC’s Shareholding Ratio, and (ii) sell all or part of the remaining shares in the JVC on the stock exchange or over-the-counter market after the Tenth Anniversary Date without any restrictions under this Agreement. If ABC desires to sell its JVC shares in private transactions even after the JVC shares are listed or registered, ABC may sell, in a single private transaction or series of private transactions, its shares in the JVC, subject to the Section 6.9 restrictions; provided that ABC’s then shareholding ratio after the consummation of each such sale is _____ percent (__%) or more of the total issued shares of the JVC between the Fifth and Tenth Anniversary Dates (it being understood and agreed that in case ABC’s Shareholding Ratio is reduced after the Second Closing Date by reason of its election not to participate in the contribution of any additional capital under Section 6.6(b) above, then the minimum shareholding ratio that ABC will be required to maintain between the Fifth and Tenth Anniversary Dates for purposes of private transactions hereunder shall be computed by multiplying ABC’s then shareholding ratio by the above percentage, divided by ABC’s Shareholding Ratio); and provided further that ABC may sell all or part of the remaining JVC shares after the Tenth Anniversary Date regardless of ABC’s then shareholding ratio and without any obligation to maintain any minimum shareholding ratio. 6.9 Share Transfer Restrictions (a) Before and including the Fifth Anniversary Date, no Party shall have the right to sell, transfer or otherwise dispose of all or part of its shares of the JVC to any third party. (b) If, after the Fifth Anniversary Date, either Party desires to sell, transfer or otherwise dispose of all or any portion of its shares in the JVC, such Party (“ Selling Party” ) shall first offer all such shares by written notice to the other Party (“ Offeree Party” ), specifying the price, terms and conditions of sale; provided, that in case the Selling Party is ABC, (i) it may sell, transfer or otherwise dispose of all or part of its shares in the JVC hereunder between the Fifth and Tenth Anniversary Dates only if its then shareholding ratio after the consummation of each sale, transfer or other disposition hereunder is _____ percent (__%) or more of the total issued shares of the JVC between the Fifth and Tenth Anniversary Dates (it being understood and agreed that in case ABC’s Shareholding Ratio is reduced after the Second Closing Date by reason of its election not to participate in the contribution of any additional capital under Section 6.6(b) above, then the minimum shareholding ratio that ABC will be required to maintain between the Fifth and Tenth Anniversary Dates for purposes of this Section shall be computed by multiplying ABC’s then shareholding ratio by the above percentage, divided by ABC’s Shareholding Ratio); and (ii) ABC may sell, transfer or otherwise dispose of its remaining shares in the JVC after the Tenth Anniversary Date without any obligation to maintain any minimum shareholding ratio. The Offeree Party may accept this offer with regard to all of the offered shares or may designate one or more persons or legal entities (“ Designee” ) to purchase, whether jointly with the Offeree Party or not, all or any portion of the offered shares in lieu of the Offeree Party. If the Offeree Party and/or Designee does not accept all of the offered shares in writing within ______ (__) days from the date of delivery of such written notice (“ Acceptance Period” ), then the Selling Party shall thereafter be free to sell, transfer, or otherwise dispose of such offered shares within a period of ___ (__) months (“ Free Sale Period” ) after the expiration of the Acceptance Period; provided, however, that the Selling Party shall not sell, transfer or otherwise dispose of such shares to any third party either (i) at a lower price than the price at which such shares were offered to the Offeree Party and/or Designee, or (ii) on other terms or conditions more favorable than those offered to the Offeree Party and/or Designee. If all of the offered shares are not sold, transferred or otherwise disposed of to third parties upon the terms established herein and within the Free Sale Period, then they shall automatically become subject once more to the terms of this Section as if they had never before been offered for sale; provided, further, that, by giving a ___ days’ prior written notice to XYZ (if XYZ is the Selling Party), ABC shall have the right to participate in the sale by XYZ of its shares during the Free Sale Period up to and including all of the shares owned by ABC as of the date of such sale and at a purchase price per share equal to that offered to XYZ by the third party. (c) The Acceptance Period and/or Free Sale Period shall be extended until any government approval necessary for the sale, transfer or other disposition of the shares in question has been obtained to the satisfaction of the Selling Party, Offeree Party, Designee and/or third party, as the case may be, or officially and finally denied; provided, that the party seeking to extend the Acceptance Period and/or Free Sale Period shall have used due diligence in soliciting such government approval. (d) Notwithstanding the provisions of subsections (a) and (b) above, (i) each Party may, without restriction, sell, transfer or otherwise dispose of all or any of its shares in the JVC to its Affiliate; provided, that such Party shall purchase or otherwise recover ownership of all said shares whenever it ceases to be an Affiliate of such Party, and (ii) if ABC is required to sell, transfer or otherwise dispose of any portion of its shares of the JVC pursuant to any applicable Korean law, regulation or administrative or court order, ABC shall be free to sell, transfer, or otherwise dispose of such portion of its shares free of the restrictions of this Section 6.9. (e) Neither Party shall sell, transfer or otherwise dispose of all or any portion of its shares to its Affiliate or to a third party (including a Designee) unless the party acquiring such shares, as a condition precedent to such acquisition, delivers a written undertaking to the other Party and the JVC, in the form and substance acceptable to the other Party and the JVC, agreeing to observe and be bound by all provisions of this Agreement and other agreements related hereto as if such third party were a party hereto and/or thereto. (f) After completion of and/or compliance with the procedures required in Sections 6.9(b) through 6.9(e) hereof: (i) The Selling Party shall then make application to the JVC for approval of the transfer by the Board to transfer the offered shares to the Offeree Party at the price determined by the Selling Party and the Offeree Party. (ii) Provided that Sections 6.9(b) through 6.9(e) above are observed, the Parties shall cause the directors nominated by them to approve such transfer. (iii) If a transferor who is a Party to this Agreement fails to observe the procedure of Sections 6.9(b) through 6.9(e) above, the Parties shall cause their nominated directors to vote to disapprove a request by such failing Party for transfer of shares to a third party. (g) No party shall pledge or hypothecate any shares of the JVC nor otherwise use such shares as collateral nor for any other purpose which could result in an involuntary transfer or assignment of such shares or any part thereof to a third party, unless prior consent to such pledge, hypothecation or other such use has been received in writing from the other party. (h) If either Party shall sell, transfer or otherwise dispose of all of its shares to third party(ies), other than to its Affiliate, the Parties agree that the JVC shall immediately take all action appropriate or necessary to cease all use in any form of such selling or transferring Party’s name, trade name or trademark and the Korean equivalent thereof in and by the JVC, unless otherwise agreed in writing with such Party. (i) Since damages arising from breach of the obligations under this Section 6.9 may be difficult to determine with precision, the Parties agree that any Party found to have breached the terms of Section 6.9 shall pay to the non﷓breaching Party as liquidated damages: (i) the greater of (A) twice the fair market value of the shares transferred in violation of this Section, or (B) twice the gross compensation received by the breaching Party in the transaction whereby the breach occurred, if the JVC’s shares are not listed on a recognized stock exchange or are not registered for trading in the over-the-counter market at the time of the breach. In such event, the fair market value of the shares shall be determined by a reputable international accounting firm to be agreed between the Parties and at the cost of the breaching Party (and if the Parties fail to agree on such accounting firm within thirty (30) days, appointed by the Korean Institute of the Certified Public Accountants); or (ii) the greater of (A) the twice the weighted average market price for thirty (30) trading days immediately preceding the day of the transaction whereby the breach occurs, multiplied by the number of the shares transferred in violation of this Section, or (B) twice the gross compensation received by the breaching Party in the transaction whereby the breach occurred, if the JVC shares are listed on a recognized stock exchange or are registered for trading in the over-the-counter market at the time of the breach. The Parties agree that such liquidated damages are fair and reasonable. Application of this liquidated damage provision shall not prevent the non-breaching Party from enforcing its rights or augmenting its protection by such other remedies as may be available. (j) Confidentiality. Notwithstanding the transfer of all of their respective shares pursuant to this Section, the Parties agree they will not be relieved of their confidentiality obligations under Section 20.1 hereof. The above-mentioned confidentiality obligations of each Party to the other Party and of the Selling Party to the JVC shall remain in effect for three (3) years following the effective date of such assignment. SECTION 7. OFFSET ASSISTANCE The JVC will support the efforts of PP Corporation and its subsidiaries, divisions and affiliates (for purposes of this Section, collectively, “ PPC” ) to obtain offset credits as a result of the formation of and business generated by the JVC; provided, however, that the JVC shall not itself incur any obligations or liabilities as a result of such support. Such support shall consist of but not be limited to: (a) working with representatives of PPC to enlist the support of the cognizant ministry within Korea for the recognition of offset credits associated with JVC activities; (b) supporting initiatives to obtain recognition of the formation of the JVC as an offset project; (c) supporting initiatives to make additional investments in the JVC by PPC eligible for offset credit; (d) supporting initiatives to obtain offset credits for exports, technology transfers and training by the JVC; and (e) supporting initiatives to permit PPC to accumulate offset credits for future use as a result of the activities of the JVC. SECTION 8. PURCHASE OF BUSINESS ABCS is currently engaged in the business of designing, manufacturing, installing, distributing, marketing, selling, exporting and providing maintenance services for , product 1, product 2, product 3 and product 4, as further described in the BTA to be executed by the JVC and ABCIS (the “ Business” ), and ABCIS has agreed to transfer the Business to the JVC according to the terms of the BTA in the form of Attachment 1.8 attached hereto. The Parties agree to cause ABCIS and the JVC to execute the BTA on the First Closing Date. A detailed list of the assets of ABCIS to be acquired by the JVC is set forth in the BTA. SECTION 9. TECHNOLOGY AND TRADEMARKS 9.1 Trade Name and Trademark On the First Closing Date, the Parties shall cause the JVC to execute (i) XYZ Trade Name and Trademark License Agreement between the JVC and XYZ in the form attached hereto as Attachment 9.1A, and (ii) ABC Trade Name and Trademark License Agreement between the JVC and ABC in the form attached hereto as Attachment 9.1B. 9.2 New XYZ Products. If the JVC decides to produce other products in addition to those manufactured under XYZ Trade Name and Trademark License Agreement, the technology and know-how for producing these other products shall be obtained through an appropriate amendment to XYZ Trade Name and Trademark License Agreement or through a separate technology license agreement or agreements, subject to Board approval. 9.3 Licensing Activities. The JVC shall be authorized to license its technology to other entities, subject to Board approval. SECTION 10. MEETINGS AND RESOLUTIONS OF SHAREHOLDERS 10.1 The Board shall decide the time and place for convening all meetings of the JVC's shareholders except where Korean law provides otherwise, and notice thereof shall be given as set forth in the Articles of Incorporation. 10.2 All actions and resolutions of the shareholders shall be adopted by the affirmative vote of a majority of all the issued and outstanding voting shares of the JVC, except that resolution of each of the items listed in Attachment 10.2 shall be adopted by the unanimous vote of all the issued and outstanding voting shares of the JVC. No shareholders’ meeting shall be duly constituted unless a majority of all the issued and outstanding shares of the JVC are duly represented therein. SECTION 11 BOARD OF DIRECTORS 11.1 The Formation of the Board (a) Authorities. The Board shall direct the operations of the JVC according to Korea law. (b) Composition. The Board shall consist of ( ) directors, ( ) of whom shall be nominated by ABC and ( ) of whom shall be nominated by XYZ. At the time this Agreement is executed and each time directors are nominated thereafter, each Party shall notify the other of the names of its nominees. (c) Term and Replacement. Each director shall be appointed for a term of three (3) years and may serve consecutive terms if re-nominated by the Party which originally nominated such director. If a seat on the Board is vacated by the retirement, resignation, illness, disability or death of a director or by the removal of such director by the Party which originally nominated such director, the Party which originally nominated such director shall nominate a successor to serve such director’s remaining term. (d) If either ABC or XYZ wishes to replace any director which it nominated, with or without cause, the other Party shall exercise its voting right to approve such replacement. The Party proposing the dismissal shall indemnify and hold the JVC and the other Party harmless from any and all damages, liabilities and other expenses that may arise out of such action. (e) The Representative Director shall preside at all meetings of the Board. (f) Additional Attendees. Any Management Personnel of the JVC may attend Board meetings upon the invitation of the Board but shall not be entitled to vote unless he or she is a director in his/her own rights. 11.2 Meetings and Powers of Board (a) Powers. The Board shall have the authority set forth herein and in the Articles of Incorporation. (b) Meeting. Regular meetings of the Board shall be held at least twice each year. Upon the written request of one (1) or more of the directors of the JVC specifying the matters to be discussed, the Representative Director shall convene an interim meeting of the Board. (c) Notice and Agenda. Board meetings shall be held at the registered address of the JVC or such other address in Korea or abroad as may be designated by the Board. Meetings shall be held upon fourteen (14) days prior notice to the directors, provided that such notice requirement may be waived by unanimous written consent of all directors and statutory auditors. A notice of a Board meeting shall cover the agenda, time and place of such meeting. The Representative Director shall be responsible for convening and presiding over such meetings. (d) [Proxies. If a Board member is unable to participate in a Board meeting in person he may issue a proxy and entrust another person to participate in the meeting on his behalf. The representative so entrusted shall have the same rights and powers as the Board member. If a Board member fails to participate or to entrust another to participate, he will be deemed as having waived such right.] (e) Quorum. ( ) directors present [in person, by proxy] shall constitute a quorum which shall be necessary for the conduct of business at any meeting of the Board. If at any properly convened meeting, no quorum is constituted because less than ( ) directors are present [in person or by proxy], then the Board shall reconvene at the same time and place within ten (10) days of the originally scheduled meeting. If at any reconvened meeting no quorum is present, representatives of the Parties shall meet to resolve the situation and take appropriate steps to cause the Board to meet promptly and to act. (f) Each director present [in person or by proxy] at a meeting of the Board shall have one vote. If upon any resolution there is a deadlock, such resolution shall remain undecided. (g) Protection of Minority Rights and Unanimous Votes. Resolution of each of the items listed in Attachment 11.2(g) shall require the unanimous affirmative vote of each and every director of the Board [voting in person or by proxy] at such meeting. (h) Simple Majority. Other items that require resolution by the Board must be adopted by the affirmative vote of a simple majority of the directors present [in person, or by proxy] at such meeting where a quorum is present. (i) Salaries, Expenses and Liabilities. Directors shall not be paid any salaries, except when a director is also an employee of the JVC. The JVC shall be responsible for the reasonable expenses incurred by the appointed directors in attending Board meetings. No director shall have any personal liability for any act performed in his capacity as a director of the JVC in good faith, except for acts as would constitute gross negligence, willful misconduct, violations of the criminal laws of any jurisdiction to which the JVC or relevant director is subject, or willful violation of the Articles of Incorporation. 11.3 Statutory Auditor(s) (a) The JVC shall have one (1) standing statutory auditor and one (1) non-standing statutory auditor. A standing statutory auditor shall be nominated by XYZ and a non-standing statutory auditor shall be appointed by ABC. Each statutory auditor shall be appointed for a term of three (3) years and may serve consecutive terms if re-nominated by the Party which originally nominated such statutory auditor. (b) If the Party which originally nominated a statutory auditor wishes to replace him or her, with or without cause, the other Party shall exercise its voting right to approve such replacement. The Party proposing the dismissal shall indemnify and hold the JVC and the other Party harmless from any and all damages, liabilities and other expenses that may arise out of such action. (c) In case the position of a statutory auditor becomes vacant due to the retirement, resignation, illness, disability or death of a statutory auditor or by the removal of such statutory auditor by the Party which originally nominated such statutory auditor, the Party which originally nominated such statutory auditor shall nominate a successor to serve such statutory auditor’s remaining term. SECTION 12 OPERATIONS AND MANAGEMENT 12.1 Management and Organization (a) Board and Managers. The JVC shall adopt a management system under which the management organization shall be responsible to and under the leadership of the Board. The JVC shall have a Representative Director and a Finance Manager, who shall be individuals of high professional qualifications and experience. The Representative Director and the Finance Manager shall be nominated by XYZ. The Representative Director and the Finance Manager shall be appointed by the Board pursuant a duly adopted resolution. (b) Term of Office and Dismissal. The term of office of the Representative Director shall be three (3) years, or as determined by the Board. The Representative Director may be dismissed at any time by a resolution of the Board. If it becomes necessary, due to dismissal or resignation, to replace the Representative Director, XYZ shall nominate his or her replacement for appointment by the Board. 12.2 Responsibilities and Powers of the Representative Director The duties of the Representative Director shall consist of carrying out the decisions of the Board and organizing, directing and deciding all matters related to the day-to-day operation and management of the JVC in accordance with modern management practices and structures. The Representative Director shall have the power to appoint and dismiss Working Personnel in accordance with Korean law and the labor management policies to be established by the Board. Within the limitations specified in the Articles of Incorporation, this Agreement, and as may be determined by the Board, the Representative Director shall represent the JVC in all matters concerning its day-to-day operations and management. The specific powers and responsibilities of the Representative Director, including his or her right and authority to act on behalf of, and bind, the JVC, shall be as set forth herein and in the relevant provisions of the Articles of Incorporation, or as may be determined by the Board from time to time. 12.3 Annual Plans and Budgets The Representative Director shall be responsible for the preparation of the annual business plan and budget of the JVC. The annual business plan and budget (including the projected balance sheet, profit and loss statement and cash flow report) for each fiscal year shall be submitted to the Board for approval and shall include comprehensive detailed information on: (a) procurement of equipment and other assets of the JVC; (b) the raising and application of funds; (c) plans with respect to production and sale of the products manufactured by the JVC; (d) the repair and maintenance of the assets and equipment of the JVC; (e) the estimated income and expenditures of the JVC covered by the production plan and budget, including annual profit distribution plan; (f) plans for training the staff and workers of the JVC; (g) requirements of raw materials, fuel, water, electricity and other utilities, and all other inputs for the next year’s production; (h) personnel and organizational set-up plan of the JVC; (i) major projects for expanding the scope of production and sales activities; and (j) any other matter in respect of which the Board may have requested a report. 12.4 Quarterly Management Report The Representative Director shall prepare a quarterly management report in the form recommended by Board and containing such information as shall be requested by the Board. 12.5 Approval and Implementation of Annual Plans and Budgets The Board shall examine and approve the annual business plan and budget submitted. The Representative Director shall be responsible for the implementation of the plan and budget approved by the Board. 12.6 Quality Control Program The JVC shall strive to maintain strict quality standards for all of the products manufactured by the JVC through the adoption of the following measures: (a) Quality Control Department. The JVC shall establish a quality control department, to be headed by a manager, who shall take responsibility for all of the JVC’s quality and reliability work. (b) Inspections. Strict inspection for conformity to standards shall be carried out on all raw materials, purchased components, finished components and finished products. (c) Feedback System. Product quality feedback and after-sales systems shall be instituted. (d) Inspection Facilities. The JVC shall establish a quality inspection facility with appropriate qualification and measuring equipment. SECTION 13 BASIC OPERATING POLICIES 13.1 The Parties are in agreement on the corporate and operating policies set forth below in this Section. The Parties agree to vote their shares and to cause their nominated directors and other managers to effectuate such policies during the continuance of this Agreement. 13.2 XYZ (together with its permissible transferees hereunder) and ABC (together with its permissible transferees hereunder) shall own the entire issued capital stock of the JVC. 13.3 The books and records of the JVC (i) shall, to the maximum extent allowable, be maintained in the Korean and English languages in accordance with Korean GAAP applied on a consistent basis, and (ii) shall accurately reflect JVC’s financial position. For the financial reporting requirements of XYZ, the JVC shall prepare at the times and in the manner required such financial information as is required by subsidiaries of XYZ and Affiliates which are located outside the United States. 13.4 ABC and XYZ agree to cause the books and records of the JVC to be audited at the end of each fiscal year during the term of this Agreement by the Independent Auditor appointed pursuant to Section 15.2 hereof (“ Annual Audit” ). Such firm of accountants shall yearly provide the Parties with financial reports in the English and Korean languages in a form acceptable to the Parties, bearing in mind any reporting requirements in the United States to which XYZ may be subject. Copies of such Annual Audits shall be provided to the Parties at the JVC’s expenses. 13.5 The fiscal year of the JVC shall begin on December 1 and shall end on November 30 of each year; provided, however, that the first fiscal year shall begin on the date the JVC is incorporated and shall end on November 30 immediately following. All dates herein have reference to the Gregorian calendar. 13.6 In recognition of the language difference between the Parties the results of all shareholders’ meetings and Board meetings shall be conducted in the English language and recorded in the Korean and English languages. In the event of conflict between the Korean and English version, the English version shall prevail. The Parties further agree that all significant financial, business, technical or other information and data of JVC shall be translated on a timely basis into the Korean or English language at the JVC’s costs, when reasonably requested by a Party. 13.7 The Parties shall exercise the voting rights as shareholders and cause the directors appointed by them to vote in such manner as to give effect to the terms of this Agreement. The Parties shall use their best efforts to ensure the JVC performs and observes all the terms and conditions on its part to be observed and performed under any contract or arrangement from time to time subsisting between the Parties or the JVC. SECTION 14 LABOR MANAGEMENT AND POLICIES 14.1 Governing Principle The Representative Director shall formulate a plan for matters concerning the recruitment, employment, dismissal, wages, labor insurance, welfare benefits, bonuses and allowances reward and discipline of the workers and staff members of the JVC (including whether to extend any existing labor contracts) in accordance with modern management standards, practices and policies, the relevant laws and regulations of Korea. The plan shall be submitted for approval of the Board. 14.2 Working Personnel Employees other than Management Personnel shall be employed by the JVC in accordance with the relevant laws and regulations of Korea, JVC policies, and in the case of any workers duly represented by a labor union, a collective bargaining agreement shall be entered into between the JVC and the labor union after the establishment of the JVC. Such policies and collective bargaining agreement shall establish all terms governing the employment duties and benefits. 14.3 Management Personnel Management Personnel shall be employed by the JVC in accordance with the terms of individual employment agreements. The detailed terms and conditions of the employment and compensation of the Management Personnel shall be reviewed by the Board. 14.4 Expatriate Personnel As the JVC’s needs require, expatriate Management Personnel and senior technical personnel shall be hired by the JVC upon the recommendation of XYZ. Such personnel shall enter into individual employment agreements with the JVC. 14.5 Conformity with Labor Protection The JVC shall conform to rules and regulations of the Korean government concerning labor protection and ensure safe and civilized protection. The JVC shall also conform to health, safety and environmental rules and regulations and guidelines of XYZ. 14.6 Human and Natural Resources Protection Policies In addition to meeting the health, environmental protection and worker safety requirements stipulated by the Korean government the JVC shall adopt XYZ’s Human and Natural Resources Protection policies, procedures, programs and standards (“ HNRP Policies” ), to the extent such do not conflict with Korean Law. The parties shall cause the JVC to observe all internal reporting procedures under the HNRP Policies subject to the foregoing. SECTION 15 FINANCIAL AFFAIRS AND ACCOUNTING 15.1 Accounting System (a) Responsibilities. Finance Manager of the JVC, under the leadership of the Representative Director, shall be responsible for the financial management of the JVC. (b) Procedures. The Representative Director and the Finance Manager shall prepare the accounting system and procedures in accordance with Korean law and Korean GAAP. The JVC shall adopt the operating and financial policies and procedures recommended by XYZ to the extent they are not in conflict with Korean law and Korean GAAP, and shall prepare periodic reporting of financial information as requested by XYZ. 15.2 Auditing (a) Independent Audit. ______________ and/or its local affiliate, shall be engaged by the JVC as its auditor to examine and verify the annual report on the financial accounts (“ Independent Auditor” ). The JVC shall submit to the Parties the annual financial statements (including the audited Profit and Loss Account, the Balance Sheet and Cash Flow Balance and Foreign Exchange Balance for the fiscal year) within three (3) months after the end of the fiscal year, together with the audit report of the Independent Auditor. The JVC shall also prepare and distribute to the Parties a monthly report on the business of the JVC. (b) Party Audits. Each Party may, at its own expense, appoint an accountant (which may be an accountant paid in either abroad or in Korea), on behalf of such Party, to audit the accounts of the JVC. Reasonable cooperation relating to providing access to the accounting books and records shall be given to such accountant and such accountant shall keep confidential from unaffiliated third parties the information disclosed during the course of his audit. (c) Board Review. The Board shall review and approve the periodic audits of the accounts. In the event that the Board determines that the audits submitted by the Independent Auditor are unable to properly meet the standards set forth above, the Board may replace the Independent Auditor or retain another auditor at JVC’s expense, to supplement or adjust the work of the Independent Auditor or to perform specific accounting and auditing tasks. 15.3 Profit Distribution (a) Proportionate Distributions. The Parties agree in principle that the after-tax profit for each fiscal year shall be distributed to the Parties. Subject to the mandatory provisions of the relevant laws and regulations of Korea, the after-tax profit, if any, of the JVC for each fiscal year shall be distributed (and the shareholders shall vote to approve the distribution of such after-tax profit as a dividend) pursuant to a resolution of the shareholders’ meeting held for that fiscal year in proportion to their respective shares in the paid-in capital of the JVC. (b) Profit Declaration and Payment. All profits of the JVC shall be declared in Won. (c) Method of Payment. All payments to be distributed under this Section 15 shall at the request of the receiving Party be transmitted electronically to an account at a bank specified in advance by such Party, or pursuant to any other method agreed by the Parties. (d) Any and all cash distributions or remittances of any kind (including, but not limited to, dividends, and distributions which may be made upon liquidation, dissolution, or reorganization) which may be payable by the JVC to XYZ shall be paid in U.S. Dollars or other currency designated by XYZ, and remitted to such bank account as may be designated from time to time by XYZ. The JVC shall make such tax withholdings from such cash distributions or remittances as are required under Korean law. (e) If, for any reason, Government Approval cannot be obtained for payment in the manner set forth above, then such payment shall be made in any other currency and/or in any other manner reasonably specified by XYZ. SECTION 16 TAXATION AND INSURANCE 16.1 Income Tax, Customs Duties and Other Taxes (a) Tax Payment. The JVC shall pay taxes under the tax laws and regulations applicable to a Korean [______] Hoesa. JVC employees, including Management Personnel and expatriate personnel shall be responsible for and pay their individual income tax in accordance with the tax laws of Korea and their legal domicile. The JVC shall make such tax withholdings from employees’ wages as are required by Korean law. (b) Tax preferences. The JVC will use its best endeavors to apply for and obtain preferential tax treatment, reductions and exemptions, as provided by the relevant regulations. 16.2 Insurance The JVC shall, at its own cost and expense, take out and maintain full and adequate insurance of the JVC against loss or damage by fire and such other risks as may be decided by the Board. The property, transportation and other items of insurance of the JVC shall be obtained within Korea or as otherwise determined by the Board. The types and amounts of insurance coverage shall be determined by the Board in accordance with applicable Korean laws and XYZ’ policies, practices or recommendations, if any. SECTION 17 REPRESENTATIONS AND WARRANTIES Each Party represents and warrants to the other that; (a) it is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction wherein it is organized and existing; (b) it has all necessary corporate power and authority to enter into this Agreement and the Related Agreements, and to perform all of the obligations to be performed by it hereunder and thereunder; (c) subject to the obtaining of all required Government Approvals of this Agreement, this Agreement constitutes a valid and legally binding obligation of the Party and will be enforceable against the Party in accordance with its terms; (d) this Agreement and the Related Agreements, and the consummation of the transactions contemplated hereby and thereby have been duly authorized and approved by and on behalf of the Party by all requisite corporate actions; and (e) the execution and delivery of this Agreement and the Related Agreements, and the consummation of the transactions contemplated hereby and thereby, and the fulfillment of and compliance with the terms, and conditions hereof and thereof, do not (i) violate any judicial or administrative order, award, judgement or decree applicable to the Party, or (ii) conflict with the terms, conditions or provisions of the articles of incorporation or any other regulations of the Party. SECTION 18 TERMINATION AND LIQUIDATION 18.1 Reasons for Termination A Party shall have the right to give a written notice of termination upon the occurrence of any one of the following events: (a) Material Breach. If the other Party materially breaches this Agreement or violates the Articles of Incorporation, and such breach or violation is not cured within sixty (60) days of written notice to the breaching Party; (b) Bankruptcy. If the other Party becomes bankrupt, or is the subject of proceedings for liquidation or dissolution (excluding any automatic dissolution of a Party following the merger of such Party with or into its Affiliate), or ceases to carry on business or becomes unable to pay its debts as they come due, or if creditors of the other Party have taken over management of such Party; (c) Expropriation. If all or any material part of the assets of the JVC are expropriated by any government authority; (d) Government Action. If any government authority having authority over a Party requires any provision of this Agreement or the Articles of Incorporation to be revised in such a way as to cause significant adverse consequences to the JVC or a Party. (e) Force Majeure. If the conditions or consequences of Force Majeure prevail for a period in excess of three (3) consecutive complete calendar months and the Parties have been unable to find an equitable solution pursuant to Section 19 hereof; or (f) Termination of Related Agreements. If any of the Related Agreements is terminated prior to its scheduled expiration; provided, that a party whose breach under any such Related Agreement has caused termination thereof may not terminate this Agreement pursuant to this Section 18.1(f). 18.2 Notification Procedure In the event that a Party gives notice of termination pursuant to Section 18.1 hereof, the Parties shall, within a one-month period after such notice is given, commence negotiations and endeavor to resolve the reason for notification of termination. In the event matters are not resolved to the satisfaction of the Parties within one (1) month after commencement of negotiations, or the non-notifying Party refuses to commence negotiations within the period stated above, the notifying Party may terminate this Agreement by, and effective upon, giving the other Party written notice of termination. 18.3 Automatic Termination. This Agreement shall terminate automatically: (a) Failure to Close. If the First Closing does not occur for whatever reason on or before ________, or if the Second Closing does not occur for whatever reason on or before ___________; or (b) Upon sale, transfer or other disposition by either Party and its Affiliates of all of their shares in the JVC in accordance with the terms hereunder. 18.4 Consequences of Termination (a) Termination of this Agreement shall be without prejudice to the accrued rights and liabilities of the Parties at the date of termination, unless waived in writing by mutual agreement of the Parties. (b) If this Agreement is terminated by a Party (“ Terminating Party” ) in consequence of a material breach of this Agreement by the other party (“ Breaching Party” ), and the Terminating Party is not itself in material breach of this Agreement at the time notice of termination is given, then (i) the Terminating Party shall enjoy the right to secure, at the JVC’s expense, an appraisal of the fair market value of the JVC’s shares from a reputable international accounting firm to be agreed between the Parties (or if the Parties fail to agree on such accounting firm within thirty (30) days, appointed by the Korean Institute of Certified Public Accountants); (ii) the Terminating Party shall have the following rights (without prejudice to any right it may have to receive damages in consequence of breach of this Agreement) and the Breaching Party shall have corresponding obligations: (A) the right to require the Breaching Party to sell all or a portion of its shares of the JVC to the Terminating Party or its designee at their appraised value; (B) the right to require the Breaching Party to purchase all or a portion of the Terminating Party’s shares of the JVC at their appraised value; or (C) the right to require the Breaching Party to join with the Terminating Party to cause the JVC to go into liquidation; and (iii) a contract for the sale and purchase of the shares shall be deemed to have been entered into upon the delivery of written notice to the Breaching Party of the decision of the Terminating Party to exercise the option given above, and payment for the shares shall be due within sixty (60) days of the completion of the appraisal. 18.5 Liquidation (a) Option upon Termination. In the event that this Agreement has been terminated for any reason and the Parties have not agreed on an acquisition of the JVC as a going concern by a Party or by a third party, then the physical assets of the JVC shall be valued by and liquidated under the direction of the Board. (b) Valuing and Selling Procedure. In valuing and selling physical assets, the Board shall use every effort to obtain the highest possible price for such assets, including the retention of an independent third party expert knowledgeable in assessing the value of the types of assets owned or held by the JVC to assist in such valuation. Sales of the JVC’s assets shall be in Won to the fullest extent possible, and shall be deposited in a joint account. (c) Settlement and Payment. After liquidation and the settlement of all outstanding debts of the JVC, including the payment of all Management Personnel and Working Personnel salaries, and subject to the payment of any applicable taxes, amounts remaining in the joint account shall be paid over to the Parties in proportion to their respective shares in the paid-in capital of the JVC. Any and all amounts payable to XYZ shall be paid promptly in United States Dollars or such other currency designated by XYZ and shall be freely remittable by XYZ out of Korea, subject to any Government Approvals. SECTION 19 FORCE MAJEURE 19.1 Force Majeure (a) Definition and Examples. “ Force Majeure” shall mean all events which are beyond the control of the Parties to this Agreement, and which are unforeseen, or if foreseen, unavoidable, and which prevent total or partial performance by a Party. Such events shall include but are not limited to any strikes, lockouts, explosions, shipwrecks, acts of nature or the public enemy, fires, flood, sabotage, accidents, war, riots, interference by military authorities, insurrections, inability to obtain transportation, and any other similar or different contingencies; provided however, that the Party so prevented from complying herewith shall not have procured such Force Majeure, shall have used reasonable diligence to avoid such Force Majeure and ameliorate its effects, and shall continue to take all actions within its power to comply fully with the terms of this Agreement. (b) Effect. If an event of Force Majeure occurs, to the extent that the contractual obligations of the Parties to this Agreement (except the obligations under Section 20 hereof) cannot be performed as a result of such event, such contractual obligations shall be suspended during the period of delay caused by the Force Majeure and shall be automatically extended, without penalty, for a period equal to such suspension, subject to the provisions of Section 18.1(e) above. (c) Notice Required. The Party claiming Force Majeure shall inform the other Party in writing within ten (10) days after the occurrence of said Force Majeure and shall furnish appropriate proof of the claim of the Force Majeure. The Party claiming Force Majeure shall also use all reasonable endeavors to remove or remedy the Force Majeure. (d) Consultation Required. In the event of Force Majeure, the Parties shall immediately consult with each other in order to find an equitable solution and shall use all reasonable endeavors to minimize the consequences of such Force Majeure. SECTION 20 CONFIDENTIALITY AND NON-COMPETITION 20.1 Confidentiality (a) Mutual Obligations. From time to time prior to and during the term of this Agreement a Party may have disclosed or may disclose Proprietary Information to the other Party. In addition, the Parties may, from time to time during the term of this Agreement, obtain Proprietary Information of the JVC in connection with the operation of the JVC. Except as otherwise provided in any agreement between the JVC and a Party or for purposes of submitting any such agreement for the necessary approval of any relevant governmental authority, the Parties receiving such information shall, during the term of this Agreement and for three (3) years thereafter or until such information properly comes into the public domain: (i) maintain the confidentiality of such information; (ii) not disclose it to any person or entity, except to their employees and advisers who need to know such information to perform their responsibilities; and (iii) not use such information except for the benefit of the JVC. (b) Further Advice. Each Party shall advise its directors, senior staff, and other employees receiving such information of the existence of and the importance of complying with the obligations set forth in Section 20.1(a) above. 20.2 Non-Competition As long as both Parties remain shareholders of the JVC, both Parties shall not, and shall cause their respective Affiliates not to, engage in a business in Korea or enter into any business relationship with any other entity or person in Korea, which will compete with or which will have a materially adverse effect on the Business of the JVC; provided, however, that the Parties agree that ABC and its Affiliates are not precluded from conducting their businesses as currently conducted, including, without limitation, the motor business, or from developing, manufacturing, selling, distributing, or exporting new products that are a logical or technological extension, improvement or upgrade of the products currently being developed, manufactured, sold, distributed or exported by such companies. SECTION 21 SETTLEMENT OF DISPUTES 21.1 Consultations In the event a dispute arises in connection with the interpretation or implementation of this Agreement, the Parties shall attempt in the first instance to resolve such dispute through friendly consultations. If the dispute is not resolved in this manner within sixty (60) days after the commencement of discussions or such longer period as the Parties agree to in writing at that time, then the Parties shall submit the dispute to the International Chamber of Commerce (the “ ICC” ) in Seoul for final decision pursuant to the provisions of the Arbitration Rules of the ICC, with instructions that the arbitration be conducted in the manner set forth in Section 21.2 hereof. 21.2 Arbitration Arbitration shall be conducted as follows: (a) English Proceedings. All proceedings in any such arbitration shall be conducted in English. (b) Three Arbitrators/Applicable Law. There shall be three (3) arbitrators, all of whom shall be fluent in English and at least one of whom shall be fluent in Korean. ABC and XYZ shall each appoint one arbitrator, and a third arbitrator shall be appointed in accordance with ICC Rules. The arbitrators shall apply the substantive laws (and not the laws pertaining to conflicts or choice of laws) of Korea. (c) Award Binding. The arbitration award shall be final and binding on the Parties, and the Parties agree to be bound thereby and to act accordingly. (d) Costs. The costs of arbitration shall be borne by the losing Party, unless otherwise determined by the arbitration award. (e) Obligations to Continue. If any dispute occurs and if any dispute is under arbitration, except for the matters under dispute the Parties shall continue to exercise their remaining respective rights, and fulfill their remaining respective rights and obligations under this Agreement. (f) Enforcement. Judgement upon any award entered through arbitration may be entered in any court having jurisdiction or application may be made to any such court for judicial acceptance of the award and an order of enforcement, as the case may be. SECTION 22 GOVERNING LAW 22.1 Governing Law The validity, interpretation and implementation of this Agreement shall be governed by the published and publicly available laws of Korea (excluding conflict of laws provisions). 22.2 Legal Compliance The Parties agree to cause the JVC to comply with all applicable Korean laws, and with all applicable United States laws and regulations governing the operation of the JVC and the conduct of its employees to the extent that such compliance does not conflict with Korean laws or regulations. SECTION 23 MISCELLANEOUS 23.1 Notices Any notice or written communication provided for in this Agreement by one Party to the other, including, but not limited to, any and all offers, writings, or notices to be given hereunder, shall be made in English by paid-in airmail letter or by facsimile confirmed by paid-in airmail letter, promptly transmitted or addressed to the appropriate Party. The date of receipt of a notice or communication hereunder shall be deemed to be three (3) days after its postmark in the case of an airmail letter and one (1) working day after dispatch in the case of a facsimile. All notices and communications shall be sent to the appropriate address set forth in the Preamble hereof, until the same is changed by notice given in writing to the other Party or the Parties, as the case be. 23.2 Waiver Failure or delay on the part of any Party hereto to exercise any right, power or privilege under this Agreement, or under any Related Agreement, shall not operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege preclude any other future exercise thereof. 23.3 Amendments This Agreement may not be changed orally, but only by a written instrument signed by the Parties and approved, if required, by the relevant authorities in Korea. 23.4 Language This Agreement is written and executed in English. 23.5 Entire Agreement This Agreement and the Attachments hereto constitute the entire agreement among the Parties with respect to the subject matter of this Agreement and supersede all prior discussions, negotiations and agreements including oral agreements, if any, among them. 23.6 Headings The headings of Sections in this Agreement are for convenience only and do not substantively affect the terms this Agreement. 23.7 Assignability This Agreement and each and every covenant, term and condition hereof shall be binding upon and inure to the benefit of the Parties hereto and their respective successors, but neither this Agreement nor any rights hereunder shall be assignable, directly or indirectly, by any Party without the prior written consent of the other Party, except for an assignment in accordance with Sections 6.7 through 6.9 hereof. 23.8 Attachments The Attachments hereto are hereby made an integral part of this Agreement and are equally binding with these Sections 1-23. The Attachments are as follows: Attachment 1.8: BTA Attachment 3.3: Articles of Incorporation Attachment 5: Products Attachment 6.7: Option Price Formulas Attachment 9.1A: XYZ Trade Name and Trademark License Agreement between the JVC and XYZ Attachment 9.1B: ABC Trade Name and Trademark License Agreement between the JVC and ABC Attachment 10.2: Shareholders Resolutions Requiring Unanimous Vote Attachment 11.2(g): Board Resolutions Requiring Unanimous Vote 23.9 Confirmation After formation of the JVC, the Parties agree to cause the JVC to execute a written confirmation and agreement to the terms and conditions hereof as a binding commitment of the JVC. REMAINDER OF PAGE IS BLANK SIGNATURE PAGE TO FOLLOW IN WITNESS WHEREOF, each of the Parties hereto have caused this Agreement to be executed by their duly authorized representatives on the date first set forth above. [ABC INC.] [insert XYZ name] _________________________ _______________________ By: By: Name: Name: Title: Title: ATTACHMENT 10.2 Shareholders’ Resolutions Requiring Unanimous Vote 1. Amendment to the Articles of Incorporation; 2. Merger, liquidation, dissolution or spin-off of the JVC; and 3. Sale, transfer or other disposition of a substantial portion of the assets or business of the JVC (i.e., 10% or more of the total assets of the JVC). ATTACHMENT 11.2(g) Board Resolutions Requiring Unanimous Vote 1. To issue any new shares, bonds, options, bonds with warrants, calls, rights or other securities convertible into, exchangeable for, or evidencing the right to purchase or subscribe for, any shares of such stock of the JVC; 2. To borrow money in excess of ___________ Won; 3. To issue guarantee or provide security interest on the assets of the JVC for the benefit of a third party, including the Party or Parties; 4. To approve a transaction between the JVC and a shareholder of the JVC or its Affiliate; 5. To approve capital expenditure in any year exceeding 5% over the amount provided for in an approved business plan and budget; 6. To approve the JVC entering into any arrangement or incurring any liability which is not in the ordinary course of the business; 7. To approve the JVC entering into any arrangement or incurring any liability which is not on arm’s length terms; 8. To create any committee of the Board or the delegation of any power of the Board; 9. To approve the business plan and budget and any material deviation from an approved business plan and budget; 10. To change the Business materially, to acquire any business or to enter into any new business; and 11. To enter into, renew or vary the terms of any contracts or agreements with a value of ___________ Won or more.