Agreement
to Help an Indian Industry for Putting Up Plant and Machinery
This
Agreement is made at .............. this ... day of ................. between M/s. ABC Co.
Ltd., a Company registered under the Indian Companies Act, 1956, and having its
registered office at .............................. hereinafter referred to as 'the Indian
Company' of the One Part and M/s. XYZ Co. Ltd., a Company incorporated under
the laws in force in ... and having Its office at ........................ hereinafter
referred to as the 'Foreign Company' of the Other Part.
Whereas
the Indian Company has established a factory at ... by purchasing a highly
technical machinery and equipment from the Foreign Company.
And
Whereas at the treaty of the purchase of the said machinery and equipment It
was agreed that the Foreign Company shall render all assistance In the
maintenance and repairs of the said machinery and equipment on the terms and
conditions agreed upon between the parties and to he subsequently recorded In
writing.
And
Whereas it is now proposed to execute these presents recording the said terms
and conditions.
And
Whereas this agreement is subject to the approval by the Reserve Bank of India
or the Government of India.
Now
It Is Agreed Between The Parties Hereto As Follows: -
The
Foreign Company agrees and undertakes that whenever required by the Indian
Company. the Foreign Company will send to India one of its technician who would
be expert in the matter for which his help is required and he will attend to
the matter of repairs or maintenance of any part of the said machinery and
equipment and will have the work involved carried out.
2. The
travelling expenses of such expert deputed as well as expenses of such expert
incurred during his stay In India for travelling, boarding and lodging will be
paid by the Indian Company.
3. If
any expert sent by the Foreign Company fails to do the job of repairs or
maintenance satisfactorily the Foreign Company will at its own expense, send
one or more other experts to do the job involved.
4.
The
Foreign Company agrees to supply at the market rates such spare parts tools and
other items or parts of the said machinery and equipment as will be required to
carry out repairs and to keep the said machinery and equipment In working
condition. The Indian Company will obtain necessary import license for such
spare parts. tools etc. and the price thereof will be paid against Letters of
Credit drawn in favour of the Foreign Company.
5. For
the services to be rendered by the Foreign Company as herein provided the
Indian Company will pay to the Foreign Company lump sum royalty of ...................
6. The
lump sum royalty payable as aforesaid shall be paid to the Foreign Company In
three Instalments unless otherwise stipulated In the approved latter of the
Reserve Bank of India namely;
i
one
third of the said amount will be paid on the approval of this agreement by the
Reserve Bank and on this agreement being filed with the authorised dealer in
foreign exchange.
ii
The
second instalment of one-third amount will be paid on the supply of the know
how.
iii
The
third instalment of the balance will be paid after four years of the approval
of the Reserve Bank and the agreement is filed with the authorised dealer in
foreign exchange.
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7. All
remittances of money to be made to the Foreign Company under this agreement
will be made as per the exchange rates prevailing on the date of remittance.
8. The
payment to be made to the Foreign Company will be subject to payment of cess.
if any payable under the Research and Development cess Act, of 1986.
9. The
Indian Company will also be entitled to deduct from such payment income tax, if
any payable under the Income Tax Act 1961.
10.
Copy
of this agreement signed by both the Parties will be filed with' the several
other authorities as required by law.
11.
The
Foreign Company will supply to the Indian Company the knows how or technical
information necessary for the running of the said machinery and any
improvements made therein from time to time. The Indian Company undertakes to
maintain such know-how a secret and shall not disclose the same to any other
person. The Indian Company will secure agreements from its employees who all
acquire knowledge of the know-how to keep the same secret.
12.
The
duration of this agreement shall be years from the date the Govt. approves this
agreement but subject to the other provisions contained in the agreement. The
said period may, however, be extended as may be mutually agreed.
13.
All
payments to be made by one party to the other under this agreement shall be
made as per the directions and in the manner approved by the Reserve Bank of
India.
14.
The
approval letter of the Government of India in the Department of Industrial
Development shall be deemed to form part of this agreement. Any term of this
agreement which is inconsistent with or contrary to any term or condition
mentioned in the said letter of approval shall be treated as void and of no
effect.
15.
This
agreement will be treated as terminated on the happening of any of the events
below mentioned :
i
If
any party hereto commits breach of any provisions of this agreement and the
party who is alleged to have committed breach is served with a notice by the
other party. three months prior to the intended date of termination by the
other party and the former party has failed to amend the breach within the said
period.
ii
If
any event happens which will make the performance of this agreement impossible
including any force majeure event.
iii
If
either the Indian Company or the Foreign Company goes into either voluntary or
compulsory liquidation according to or under the law by which it is, governed.
iv
If
the parties hereto mutually agree to terminate this agreement.
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16.
All
the sanctions, approvals, permissions, licences and other requirements of the
Government of India and of any statutory authorities required for giving effect
to all the terms and conditions, of this agreement shall be obtained by the
Indian Company.
17.
In
the event of any dispute or difference arising between the parties hereto or as
to the rights and obligations under this agreement or as to any claim. monetary
or otherwise of one party against the other or as to the interpretation and
effect of any terms and conditions of this agreement, such dispute or
difference shall be referred to Arbitration of a common Arbitrator if agreed
upon otherwise to two Arbitrators, one to be appointed by each of the parties
to this agreement and such Arbitration shall be governed by the Indian
Arbitration & Conciliation Act, 1996. The venue for such Arbitration shall
be .............. in India.
18.
The
validity of this agreement and the effect or meaning of the terms hereof will
be decided according to the Indian Law.
19.
Any
communication by one party to the other shall be made by registered post
through airmail. with acknowledgement due or by telex or fax or cable. In case
the communication is made by telex or fax or cable, the same will be
subsequently but immediately thereafter confirmed by written communication sent
by registered post as aforesaid. Any evidence showing the communication was
posted or telex, fax or cable communication was made will be sufficient to
prove the posting or sending the communication.
20.
In
this agreement the expression 'know-how' shall include technical information
such as inventories formulae, processes, engineering and manufacturing skill,
scientific data, calculations, specifications. drawings, standards, sketches
and all other relevant information and knowledge.
21.
The
Foreign Company will, as a part of the know how render the following services
namely -
a. to
make a study of the market survey profitability and project report.
b. to
provide latest manufacturing and engineering technology in the manner of
production methods.
c. to
advise the Indian Company in the manufacture of the said products so as to
maintain required standard and technology.
d. to
advise the Indian Company in the work of research and quality control of the
said products
e. to
advise the Indian Company in the matter of purchasing suitable raw materials
and other accessories.
f. to
assist the Indian Company in buying further suitable machinery spare parts,
tools required in the manufacture.
g. to
advise the Indian Company in the matter of marketing of the products selling
and exporting the same.
h. to
advise and assist the Indian Company in increasing the production in adopting
proper and efficient system of production and efficiently maintaining the
plant.
i. to
advise the Indian Company for adopting matters for economising the costs of
production without sacrificing efficiency
j. to
advise the Indian Company generally in the best interest of the manufacture of
the said products and the sale thereof
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22.
None
of parties hereto consenting the rights and benefits under this agreement to
any other party without the consent writing of the other.
23.
Each
of the parties hereto shall be deemed to include its successors or permitted
assigns.
In
Witness Whereof the parties have put their respective seals the day and year
first hereinabove written. The common seal of M/s. ABC Co. Ltd., is hereunto
affixed pursuant to the resolution of the
Board
of Directors dated ................ in the presence of Mr........................,a Director duly
authorised in that behalf
The
common seal of M/s. XYZ & Co. Ltd., is hereunto affixed pursuant to the
resolution of the
Board
of Directors dated................. in the presence of Mr. .................. a Director, duly
authorised In that behalf.
Witnesses;
1.
2.
