joint research and development agreement

JOINT RESEARCH AND DEVELOPMENT AGREEMENT

BETWEEN

UNIVERSITI SAINS MALAYSIA

AND

ABC SDN BHD

IN RELATION TO DEVELOPMENT OF ……………..

Legal Office Universiti Sains Malaysia – PP7 Page 1

R E S E A R C H A N D D E V E L O P M E N T A G R E E M E N T

T H I S R E S E A R C H A N D D E V E L O P M E N T A G R E E M E N T is made

on the ___________ day of _____________ 20 (hereinafter referred to as “Agreement”);

BETWEEN

UNIVERSITI SAINS MALAYSIA, a public institution of higher learning established under the

Universities and University Colleges Act 1971 which for the purpose of this Agreement is

represented by ……………………. with its main campus at 11800 USM, Pulau Pinang

(hereinafter referred to as “USM”) of the first part;

AND

ABC SDN BHD (Company No. ………………….) a company incorporated under the

Companies Act 1965 [Act 125] and having its business address at

………………………………………………………. (hereinafter referred to as “ABC”) of the

second part.

(USM and ABC shall hereinafter be collectively referred to as "Parties" and individually as

"Party", where the context so requires).

WHEREAS

A. USM has the scientific and technical expertise of the scientists, researchers, students

and facilities as well as the experience to function amongst other things, as technology

consultant and carry out the milestone in relation to the Project as detailed in

Schedule A Part B hereof.

B. ABC has received a grant from ………… to develop and up-scale a new technology on

……….. (hereinafter referred to as “Project”).

C. ABC and USM are desirous of formalizing this collaboration by entering into this

Agreement subject to the terms and conditions as stipulated herein.


NOW IT IS HEREBY AGREED AS FOLLOWS:

CLAUSE 1 – DEFINITIONS AND INTERPRETATIONS

1.1 In this Agreement, unless the context otherwise requires, the following terms shall

have the following meaning:-

“Intellectual Property” means

(a) Inventions; manner, method or process of manufacture; method or principle

of construction; or design; plan, drawing or scientific, technical or

engineering information or document;

(b) Improvement, modification or development of any of the foregoing;

(c) Patent, application for a patent, right to apply for a patent or similar rights for

or in respect of any intellectual Property referred to in paragraph (a) or (b);

(d) Trade secret, know-how, Confidential Information or right of secrecy or

confidentiality in respect of any information or document or other Intellectual

Property referred to in paragraph (a) or (b);

(e) Copyright or other rights in the nature of copyright subsisting in any works or

other subject matter referred to in paragraph (a) or (b);

(f) Registered and unregistered trademark, registered design, application for

registration of a design, right to apply for registration of a design or similar

rights for or in respect of any work referred to in paragraph (a) or (b);

(g) Any Intellectual Property in addition to the above which falls within the

definition of intellectual property rights contained in Article 2 of the World

Intellectual Property Organisation Convention of July 1967; and

(h) Any other rights arising from intellectual activities in the scientific, literary or


artistic fields,

whether vested before or after the date of this Agreement and whether existing in

Malaysia or otherwise and for the duration of the rights;

“Confidential Information” either oral or in writing shall mean any and all technical

and non-technical information including patent, copyright, trade secret, and

proprietary information, techniques, sketches, drawings, processes, apparatus,

equipment, algorithms, software programs, software source documents, and

formulae related to a technology or invention, and includes, without limitation, its

respective information concerning research, experimental work, development, design

details and specifications, engineering, financial information, procurement

requirements, purchasing manufacturing, customer list, business forecasts, sales

and merchandising and marketing plans and information designated in writing to be

confidential or by its nature intended to be for the sole knowledge of the receiving

Party or if orally given in the circumstances of confidence or confirmed promptly in

writing as having been disclosed as confidential or proprietary for the business

arrangement and or Project; that is conveyed by the disclosing Party to the receiving

Party, in written, oral, digital, magnetic, photographic and/or whatsoever forms.

However, the term Confidential Information shall not include any information

disclosed by one Party to the other which:-

a) on the date of this Agreement , or thereafter becomes, publicly available

otherwise than through a breach of this Agreement; or

b) is required by law to disclose ( in this event, it must disclose only to the

minimum information required to comply with the law); or

c) is legitimately obtained at any time by either Party from a third party without

restrictions in respect of disclosure or use.

“Development Phase” means the development as stated and identified pursuant to

Clause 4 in this Agreement.

“Project” means the research and development project as set out in Recital A above


and as further described and detailed in Schedule A Part A hereof.

1.2 Any monetary references shall mean the Malaysian currency.

1.3 Any word (including a word defined or given a special meaning) denoting the singular

shall include the plural and vice versa.

1.4 Any word denoting one gender only shall include each other gender.

1.5 A reference to a person shall include a corporation as well as a natural person.

1.6 A reference to a Schedule is a reference to a Schedule to this Agreement.

CLAUSE 2 – COMMENCEMENT, TERM AND CONDITION PRECEDENT

2.1 This Agreement shall become effective on ……. and shall be in force for the duration

of …. (…) months thereafter unless subsequent time extensions, supplement,

continuation, or renewal is mutually agreed upon in writing between the Parties.

2.2 Notwithstanding sub-clause 2.1 above, the continuation of the Development Phase of

the Collaboration Programme (as hereinafter defined) is subject to the condition

precedent that ……………. If this condition precedent remains unsatisfied for a

period of six (6) months from the date of this Agreement, USM shall have the full

discretion and right to terminate the Agreement and the Parties hereto shall have no

claim against the other Party except on the Confidential Information clause herein.

CLAUSE 3 – COLLABORATION PROGRAMME

3.1 USM and ABC shall collaborate in the following activities (hereinafter referred to as

“the Collaboration Programme”):-

Funding Phase:

Continuation of the …… grant for the sum of Ringgit

Malaysia …. (RM …….) only

Development Phase: The carrying out of various milestone and/or


development tasks/activities for the Project as

described in Schedule A Part A and B hereof.

CLAUSE 4 – RESPONSIBILITIES OF THE PARTIES

In consideration of and subject to the terms of this Agreement and all applicable laws, the

Parties shall carry out their respective responsibilities in accordance with the provisions of this

Agreement and within the scope of responsibilities as set out below.

4.1 ABC’s responsibilities shall be as follows:-

Funding Phase (a) to secure the grant on the execution of this

Agreement.

Development Phase: (a) to be responsible for the overall running of the

Project;

(b) to carry out activities of Milestone 1 to

Milestone 9 as set out in Project Milestone and

output in Part B of Schedule A.

(c) to be responsible for all reasonable funding as

stated in sub-clause 3.1 above and as required

for the Project.

(d) to purchase, maintain and service all the

necessary equipment and expenses as per

Schedule B of this Agreement and

consumables for ABC’s Chief Technical Officer

(hereinafter referred to as “ABC CTO”) to carry

out the Project, whereby all the above

equipment and instrument shall be placed at

location to be mutually agreed by both Parties.

(e) to release and disburse the progressive


payment(s) to USM’s Chief Technical Officer

(hereinafter referred to as “USM CTO”) and/or

USM in accordance to sub clause 5.1 herein.

For the avoidance of doubt, the Schedule of

Payment shall not include the equipment cost to

be purchased and delivered by ABC pursuant

to sub clause 4.1(d) herein.

(f) The first progressive payment on the above

Schedule of Payment shall be released and

disbursed to USM CTO within ….. working days

from the date of execution of this Agreement

and the subsequent progressive payment(s)

shall be made to USM CTO according to

Schedule A project milestone

4.2 USM’s responsibilities shall be as follows:-

Development Phase: (a) to assist ABC in carrying out activities of

Milestone 2 – 9 within USM scope as per

Functional Design Specification document in

delivering the objectives of the Project as

described below;

(i) to assist ABC to develop ……. process

simulator system;

(ii) to assist ABC to develop model for ……

system.

(iii) to assist ABC for communication protocol

for ……..

(b) to assist ABC in the overall running of the

Project through the appointment of a USM

CTO; and

(c) to provide advice, personnel and the resources


for the successful completion of the Project.

4.3 Joint Responsibilities

Both Parties agree that they shall be jointly responsible for the following:

(a) to ensure that the personnel as identified and nominated by ABC CTO

and USM CTO (hereinafter referred to as “Consultants”) and both

USM’s and ABC’s Principal Consultants (as hereinafter defined) are

given full access to all information and to all areas within both Parties’

sites and Project which are relevant for the Parties to carry out work on

the Project as defined in this Agreement.

(b) Furnish such necessary facilities and equipment available at their

respective sites as necessary for the Project to be carried out.

CLAUSE 5 – COMMERCIAL

5.1 In consideration of USM carrying out its activities under the Development Phase,

ABC shall pay USM a sum of RM ……. (Ringgit Malaysia: … Only) to be disbursed

according to milestone achievement to USM CTO for consultancy fees and related

expenses as per Clause 4.2 above and subject to Clause 2.1 and 4.1(e) and (f)

above, effective from the commencement until completion of the Development

Phase.

5.2 In consideration of USM carrying out its activities under the Development Phase,

ABC shall ……

CLAUSE 6 – PERSONNEL

6.1 For the purposes of carrying out their responsibilities under this Agreement, USM

and ABC shall designate and nominate the Party’s own personnel as Consultants for

the Project. For avoidance of doubt, USM’s Principal Consultant will be ……. of the

…….., USM, (herein referred to as “USM’s Principal Consultant” and/or “USM

CTO” interchangeably), and ABC’s Principal Consultant will be …….. (herein referred

to as “ABC’s Principal Consultant” and/or “ABC CTO” interchangeably). The

Parties shall be entitled to nominate alternate personnel to act as the Parties’


respective Principal Consultant and/or Consultants in the event the named Principal

Consultant or Consultants become unavailable to carry out such duties on the

Project.

6.2 The Parties agree that USM’s Principal Consultant shall also act as the Principal

Researcher for the Project.

CLAUSE 7 – INTELLECTUAL PROPERTY

7.1 7.2 7.3

Any Project Intellectual Property created, developed, commercialized or reduced to

practice jointly by USM and ABC shall be jointly owned by the Parties at ratio of

..............

Any Project Intellectual Property created, developed, commercialized or reduced to

practice solely by one Party’s Consultant but through the significant use of the other

Party’s resources such as facilities, equipment or funds will be jointly owned by the

parties as set out in Sub Clause 7.1 hereof.

Notwithstanding the above, both Parties may negotiate on the ratio and percentage

of the ownership of the further improvements of the Project Intellectual Property

jointly created or developed by the Parties subject to the condition that USM’s shall

hold a percentage not less that what USM owns at the commencement of the

Project.

7.4 7.5 7.6

Each Party shall be responsible for the cost related to any application for the

registration of patents or any other intellectual property rights in relation to their

respective Project Intellectual Property.

Where the Project Intellectual Property is jointly owned by the Parties pursuant to the

operation of this Agreement, the Parties shall equally share the costs related to any

application for the registration of patents or any other intellectual property rights

related thereto.

All rights, titles and interests over the background Intellectual Property of either Party

and used to produce any product which forms the Project’s Intellectual Property,

shall continue to belong to that Party; and the other Party shall not have any claim on


them.

CLAUSE 8– PROGRESS REPORTS

8.1 Both Parties through their Consultants shall furnish the other Party with written

reports as to the progress of works carried out for the Project on a quarterly basis.

8.2 Each Party shall respond promptly to any queries from the other Party from time to

time in respect of the progress of the works in relation to the Project and any other

matters in relation thereto by such means as are agreed from time to time by the

Parties hereto.

8.3 Notwithstanding the above, both Parties shall collaborate to produce and deliver all

reports in relation to the Projects as may be required by the Parties from time to time.

CLAUSE 9 – CONFIDENTIALITY

9.1 The Parties including its officers, agents and authorised representatives shall not

disclose, use or communicate to persons any information which is confidential to the

other party and not otherwise publicly available nor known by the recipient at the time

of disclosure.

9.2

9.3

Each Party undertakes that it shall at all times keep confidential (and procure that its

Consultants, employees and agents shall keep confidential) any Confidential

Information which it or they may acquire in relation to the Project and the business

and affairs of the other Party to this Agreement and shall not use or disclose such

Confidential Information except as permitted under this Agreement or with the

express written consent of the other Party or in accordance with the order of a court

of competent jurisdiction or in compliance with any applicable law or regulation.

Each Party hereto further undertakes:

a) to use its best endeavours to protect such confidential information;

b) to limit its disclosure of the Confidential Information it receives from the

disclosing Party to its employees and agents on a a-need-to-know basis and


9.4

only to the extent necessary for them to carry out the Project;

c) to immediately notify the disclosing Party upon learning of any unauthorised

use or disclosure of any confidential information;

d) not to make copies, publish, reproduce or otherwise reduce into writing or into

any other tangible or intangible form all or any part thereof of the Confidential

Information save for the purposes contemplated in this Agreement and each

Party agrees that the ownership to any copies, publications or reproductions

of the Confidential Information so made remains with the disclosing Party;

e) to be accountable for the compliance and performance of the undertakings

enumerated herein on the part of each Party’s employees, officers, agents or

any permitted person to whom the Confidential Information is disclosed;

f) to exercise a degree of care and diligence no less than that which the

receiving Party applies to its own Confidential Information of a similar

character.

The obligations of confidentiality herein shall not apply to any information which the

receiving Party can show by written records:

i. was already in the public domain when it was imparted to the receiving Party

by the disclosing Party;

ii. is in or subsequently comes into the public domain through no fault on the

receiving Party;

iii. is received by the receiving Party without restriction on disclosure or use from

a third party lawfully entitled to disclose to the receiving Party without such

restriction;

iv. is developed by any of the receiving Party’s employees who have not had any

direct or indirect access to, or use or knowledge of, the information imparted

by the disclosing Party; or


9.5 9.6 9.7

v. the communication of which is required by law, a valid order issued by a court

or such other governmental body, or was otherwise necessary to establish the

rights of either Party under this Agreement.

The obligations of each of the Parties contained in this sub clause shall become

effective as of the date the Confidential Information is first made available by one

Party to the other Party and shall survive the termination of this Agreement and shall

continue in force until such time as the Confidential Information becomes public

knowledge other than by breach of this Agreement or as otherwise agreed to

between the Parties.

Without prejudicing the foregoing provisions, any information sent or received orally,

via electronic means or information disclosed without confidentiality notices shall be

deemed to be Confidential Information and the obligation of confidentiality applies

accordingly.

Both Parties specifically warrant and undertake that where the Confidential

Information of both Parties continue to be utilised for research, teaching or

educational purposes as may expressly be permitted under this Agreement, the

Parties shall ensure that the obligation of confidentiality binds all such third parties

that the Confidential Information are made available to.

CLAUSE 10 – RIGHT TO PUBLISH

10.1 The data and information accruing from the Project, which are of academic

importance for the enrichment of knowledge, may be published by USM’s Principal

Consultant/USM’s Consultants in accordance with USM’s policy. ABC shall be

provided with a copy of any such proposed publication and ABC may have no more

than twenty-one (21) days or such mutual extended period to be agreed upon by

both Parties from the date of ABC being provided with the copy of such proposed

publication, for review of data and information deemed confidential as defined in

Clause 9 above relating to confidentiality or patentable items (hereinafter referred to

as the “Review Period”). The purpose of this clause is to protect the rights of USM


and ABC with respect to any contemplated publication concerning details of an

invention or ABC’s Confidential Information, etc.

10.2 If deemed necessary by USM and/or ABC with the view to protect their interests, any

contemplated publication containing details of an invention, etc. shall be withheld

until a patent application is filed or other appropriate steps to protect commercial

value have been completed. All publications shall not include any Party’s Confidential

Information.

CLAUSE 11– RELATIONSHIP OF THE PARTIES

Nothing in this Agreement shall be construed as establishing or creating a

partnership or a relationship of a partnership between the Parties, master and

servant between any of the Parties hereto or as constituting any party as an agent or

representative of the other Party for any purpose or in any manner whatsoever or an

authority to a Party to represent or bind or pledge the credit of the other Party in

anyway.

CLAUSE 12– TERMINATION

12.1 If USM or ABC (as the case may be) commits any of the conditions stated below,

then, the aggrieved Party shall be entitled to terminate this Agreement by serving a

notice to that effect:

12.1.1 Either Party becomes insolvent or is unable to pay its debts when due or

admits in writing its inability to pay its debts; or

12.1.2 Either Party enters any arrangement or composition with its creditors

generally, or a receiver or manager is appointed; or

12.1.3 Either Party goes into liquidation or passed a resolution to go into

liquidation, otherwise than for the purpose of reconstruction; or


12.1.4 Either Party ceases to carry on an eligible activity under the grant; or

12.1.5 Either Party fails to comply with any of the obligations, terms and

conditions under this Agreement.

12.2 The notice to terminate in the case of subclauses 12.1.1 to 12.1.4 shall not be less

than thirty (30) days’ written notice. In the case of sub-clause 12.1.5, the non-

defaulting Party shall first give a fourteen (14) days’ notice in writing to the defaulting

Party to remedy such default, and where such default is not remedied within that

period, the non-defaulting Party shall then give a fifteen (15) days’ written notice to

the defaulting Party to terminate the Agreement;

12.3 Upon termination of this Agreement, both Parties shall have no obligation to each

other save and except for payments still outstanding and payable by ABC to USM,

for activities already undertaken prior to the date of such termination.

CLAUSE 13 - FORCE MAJEURE

Both Parties shall not be held liable for delays or failures to perform that result from

events or circumstances beyond the reasonable control of either Party and in

particular, any failure by either Party to carry out its obligations as set out in Clause 4

above.

CLAUSE 14 – PUBLIC STATEMENT

Both Parties shall, in making any public statement on the Project, or in relation to any

products, processes or inventions developed as a result of the Project, include in

such public statement, an acknowledgement of the financial assistance received

from the grant pursuant to this Agreement. All such public statements shall be

approved by both Parties prior to its release of the same to the public.

CLAUSE 15- ASSIGNMENT

This Agreement shall not be assigned in whole or in part by either Party without the


prior written consent of the other Party.

CLAUSE 16 – WAIVER

16.1 The waiver by a Party in respect of any breach of a term of this Agreement by the

other party shall not be deemed to be a waiver in respect of any other term or of any

subsequent breach of that term.

16.2 The failure of a Party to enforce at any time any term of this Agreement shall in no

way be interpreted as a waiver of such term.

CLAUSE 17 – APPLICABLE LAW

This Agreement shall be governed by and construed in accordance with the laws of

Malaysia.

CLAUSE 18 – NOTICES

18.1 Any notice required to be given pursuant to this Agreement shall be in writing and

may be delivered or posted by ordinary mail, postage prepaid, to the Party to which

such notice is required to be given under this Agreement at the address set out in

Schedule C hereto.

18.2 Any change of address of either Party shall be notified in writing to the other Party.

18.3 Any notice given under this clause by post shall be deemed to have been duly

served at the expiration of three (3) clear days (i.e. excluding weekends or public

holidays) after the time of such posting and production of any official post office

receipt showing the time and date of posting shall be conclusive evidence of the time

and date of posting.

CLAUSE 19 – ENTIRE AGREEMENT

The terms of the Agreement between the Parties are those set out in this Agreement

and the Schedules and no written or oral agreement or understanding made or


entered into prior to the date of this Agreement shall in any way be read or

incorporated into this Agreement.

CLAUSE 20 – SUCCESSORS-IN-TITLE

This Agreement shall be binding on the respective heirs, personal representatives,

receivers, successors-in-title and assigns of the Parties hereto.

CLAUSE 21 – AMENDMENT/MODIFICATION

Any provision of this Agreement may be amended or modified by mutual consent

between the Parties and such amendment/modification shall be in writing and signed

by the duly authorised representative of the Parties.

CLAUSE 22 – NAME, OFFICIAL EMBLEM AND LOGO

22.1 Neither Party shall use, nor permit any person or entity to use the name, acronym,

official emblem, logo, trade mark (or any variation thereof) or other Intellectual

Property (hereinafter referred to as “Brand Materials”) that is/are identified with or

belongs to the other Party on any publication, document, paper, audio or visual

presentation, or for publicity purposes.

22.2

Any use of the Brand Materials for the purposes stated in clause 22.1 above shall

first obtain the written consent of the other Party and shall comply with all reasonable

instructions as to the use of the other Party’s Brand Materials.

CLAUSE 23 – E-COMMUNICATION AND SIGNATURE

The Parties hereby consent to electronic communication and electronic signatures

being equal to signatures inked on paper. The Parties acknowledge and agree that

electronic communication is an acceptable method of communicating information

from a Party to the other party without having to communicate the same on paper.

Any communication and subsequent electronic signature that has been sent or

signed in the past, present, or future between the Parties will hold the same force

and effect as a document signed and inked on paper.


(the remainder of this page is intentionally left blank)


IN WITNESS WHEREOF the Parties hereto have caused this Agreement on the day and

year first above written.

SIGNED BY For and on behalf of UNIVERSITI SAINS MALAYSIA ………………………………………............. PROFESSOR DATO’ DR. OMAR OSMAN Vice-Chancellor

SIGNED BY For and on behalf of ABC SDN BHD …….…………………………..……… [ name & designation ]

WITNESSED BY: …………..……………………… [ name & designation ]

WITNESSED BY: ………………..…………………..… [ name & designation ]


Schedule A

PART A: PROJECT DETAILS

No Item Description

a. Project Description

b. Project Objectives

PART B: PROJECT MILESTONE AND OUTPUT

NO. MILESTONES ACTIVITIES DELIVERABLES DISBURSEMENT TARGET DATE

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

NOTE : Target date is subject to mutual agreement between ABC and USM.

Project Duration Months

SCHEDULE B

NO EXPENSES ITEMS

1. Equipment

2. Market Testing of Commercial Ready Prototype

3. Contract Expenditure

4. Expenditure of Services


SCHEDULE C

NOTICE

For USM: [ address of School ] Universiti Sains Malaysia 11800 USM Pulau Pinang. Tel: Fax: Contact person: Email:

For ABC: [ address ] Tel: Fax: Contact person: Email:

joint research and development agreement

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