23 March 1964.
This was an agreement precluding the manufacture of adhesives which were within the BAL range of products.
2 April 1964.
A start date of 1 January 1965 was agreed as the latest date that commercial manufacture and sale of the products would commence. The territory would be confined to Argentina, although Evode reserved the right to sell to parties outside the territory even though those products may be used within the territory.
Adhesives and cements are mentioned in the preamble. A net royalty of 5% on invoiced sales was agreed with a minimum royalty payable as follows:-
| After the first 12 months of operation ............................... | £500. |
| After the second 12 months of operation .......................... | £750. |
| After the third 12 months of operation ............................. | £1,000. |
| After the fourth 12 months of operation ........................... | £1,250. |
| After the fifth 12 months of operation and subsequently ... | £1,500. |
The agreement was made for 14 years from the date of commencement of the commercial operation with potential to extend for a further 15 years.
26 June 1964
An internal memo advising of the change of address for Chemotecnica-Sintyal, to that stated below.
25 October 1965.
A letter expressing appreciation to Evode Ltd. for delaying the initiation date of the agreement originally set at 1 January 1965.
The letter does not expand on the reasons for the delay but one can speculate that the lack of expertise, trained chemists, difficulty in sourcing and testing raw materials and the cost of these raw materials the majority of which came from USA or other overseas countries.
12 November 1973.
This was an agreement between Evode Ltd. and Societa Per Investimenti E Technologia SA, based in Chiasso, Switzerland.
It allowed for Chemotecnica-Sintyal to continue to manufacture and sell the licensed products in Argentina but royalties payable on these sales would be made by the above Swiss company.
The royalties to be paid were also varied.
Those products manufactured and sold prior to 1 January 1974, but excluding products for which Chemotecnica-Sintyal received technical data after 1 April 1973, a royalty payment of 2.5% on invoiced sales would be levied.
Other products, not subject to the above agreement, would carry a royalty of 5% on invoiced sales. This royalty would be reduced to 2.5% after the fourth anniversary of such products being offered by Chemotecnica-Sintyal.
12 November 1973.
A letter from Dr. Simon to Chemotecnica-Sintyal pointing out that the original agreement terminates on 31 December 1973. However HS suggests that there is no objection to Chemotecnica-Sintyal continuing to manufacture and use Evode Ltd. trade marks. A covering memo to Dr. B. S. Jackson points out that this is a cover for the transfer of the royalty payments to the Swiss company should the Argentinian authorities become suspicious.
20 June 1978.
A letter from Mr. Eric Jones to Chemotecnica-Sintyal confirming that they could continue to use Evode Ltd. trade marks until 30 December 1980, which is somewhat confusing when the contents of the letter recorded below are taken into account.
20 June 1978.
A letter from Mr. Eric Jones to Chemotecnica-Sintyal concerning outstanding royalty payments and arrangements for these to be paid covering the years 1977 and 1978.
Also it recorded that, following the receipt of these payments, the agreements between Evode Ltd., Chemotecnica-Sintyal and Societa Per Investimenti E Technologia SA would terminate.
10 July 1978.
A letter from Michel Tcherniak to Dr. Simon agreeing to the terms of Mr. Jones` letter dated 20 June 1978. This letter mentions a meeting between himself and Dr. Simon presumably when the termination agreement was reached.
Correspondence 1964-1966.
All of the correspondence which passed between Evode Ltd. and Chemotecnica-Sintyal SA was originated by Mr. Michel Tcherniak, the managing director.18 June 1964.
A letter advising that a change of address had taken place. It was now:-
Chemotecnica-Sintyal SA.
Casilla de Correo Central 2493,
Buenos Aires,
Argentina.
There is very little correspondence in this file. What is there mainly covers problems of competition, costs of raw material and the problems of a novice company becoming involved in a sophisticated technology.
1. Introduction.
1.2. The negotiations to reach an agreement were very protracted. By the time that the first correspondence is on file in mid 1963 talks between the companies had been going on for some time.
1.3. It was obvious that Evode Ltd. was very wary about entering into an agreement with an Argentinian company and asked for references.
1.4. One reference which Chemotectica Sintyal had given was a company called Asunger S.A. with which they had an association. The personnel at Evode were not impressed by Asunger.
1.5. During the course of the negotiations it appears that a peculiar tax system existed between these two countries which affected the royalties payable to Evode Ltd.
1.6. By February 1967 production of the products had still not begun and sales were anticipated to commence in March 1967 (much later than expected) hence affecting the royalties paid to Evode Ltd.
1.7. The economic situation in Argentina was obviously becoming extremely difficult so that it was increasingly problematic to pay royalties. In order to get around situation, with the agreement of Chemotectica Sintyal, an agreement was reached between Evode Ltd. and a Swiss company, Societa Per Investimenti E Tecnologica S.A., Via Motta 8, Chiasso, Switzerland.
1.8. Sources.
1.9. The information on the association between Evode Ltd. and Chemotecnica Sintyal is contained in four files.
2. Evode Ltd. had entered into the first contract with Chemotecnica Sintyal to manufacture its products under license on 2 April 1964.
2.2. D5189/4/3/1 is deposited in the Stafford Records Office and contains correspondence for the for the years 1964 and 1966. It is incomplete.
2.3. File No.3 contains originals or copies of the agreements entered into by Evode Ltd. and Chemotectica Sintyal. It would appear that this file is complete. At the time of writing it is deposited on Stafford Site.
2.4. File No.4 contains correspondence between August 1963 and May 1968. It is incomplete. At the time of writing it is deposited on Stafford Site.
2.5. File No.5 Contains correspondence between July 1970 and August 1978. It is incomplete. At the time of writing it is deposited on Stafford Site.
3. Agreements.
3.1.1. A copy of the agreement dated 2 April 1964 signed by John Foreman and Jack
Linnell for Evode Ltd. and by Dr. Robero Gold and Miguel Tcherniak for
Chemotechnica Sintyal is on file. The current address given for this company is
Rodriguez Pena 360, Buenos Aires, Argentina.
This agreement bestows on Chemoticnica Sintyal the position of licensee to
Evode Ltd. giving this company the rights to manufacture and sell the company`s
products within Argentina.
3.1.2. Bearing in mind the problems which new licensees encountered when setting up a business within their territory the license reads that sales shall begin “….by either the date of commencement of manufacture…..or by 1 January 1965 whichever is the sooner…”.
3.1.3. The net royalty payable to Evode Ltd. after the deduction of all taxes required by the Government of Argentina shall be 5% on invoiced sales.
3.1.4. Should in the period of any given 12 months the royalty due fall short of those quoted in the paragraph below Chemotecnica Sintyal must make up the said royalties due within 42 days of the end of the period.
3.1.5. Royalties due to Evode Ltd. were set out as follows:-
| For the first 12 months | £500.00 |
| For the second 12 months | £750.00 |
| For the third 12 months | £1,000.00 |
| For the fourth 12 months | £1,250.00 |
| For the fifth and subsequent 12 months | £1,500.00 |
3.1.6. It was assumed that the agreement would be ongoing as there was provision for extention after 14 years for a further 15 years.
3.1.7. he usual clause binding the members of Chemotecnica Sintyal who were privy to the formulae and processes to secrecy is included.
3.1.8. The agreement is a usual one concluded by Evode Ltd. with licensees at this time.
3.1.9. The formal bound agreement dated 1964 was presumably drawn up by Allen & Overy and is on file but is not signed by any of the officers of either company.
3.2. The supplemental agreement.
3.2.1 There is a signed supplemental agreement dated 23 March 1964 which excludes Chemotecnica Sintyal for using formulae and processes “ for the fixing of glazes tiles and mosaics to walls and floors or the slabbing of tiled fireplaces and to sell the said adhesives”.
3.3. The agreement with the Swiss company.
3.3.1 There are two copies of the agreement dated 12 November 1973 on file. Both have the provisions for the signatures of the directors of both companies included but remain unsigned.
3.3.2. The agreement was obviously a long time in preparation as there are drafts dated 10 July 1973 and 8 August 1973.
3.3.3. This agreement is concluded between Evode Ltd, and Societa Per Investimenti E Tecnologia S.A. of Via Motta 18, Chiasso, Switzerland, hereafter called the Swiss Company.
3.3.4. The agreement alludes to that dated 2 April 1964 signed between Evode Ltd. and Chemotecnica Sintyal. The reason why this new agreement was drawn up was that, whilst Chemotecnica Sintyal continued to manufacture the products under license from Evode Ltd., royalty payments due to Evode would be made payable, after 31 December 1973, by the Swiss Company.
3.3.5. By this agreement Chemotecnica Sintyal were discharged from paying royalties to Evode Ltd.
3.3.6. The Swiss Company was obliged to obtain the necessary data from Chemotecnica Sintyal in order to pay the royalties to Evode Ltd.
3.3.7. The royalties payable to Evode on products made before 1 January 1974 but not including data on products disclosed to Chemotecnica Sintyal after 1 April 1973 would carry a royalty of 2 and one half percent on the value of sales invoices.
3.3.8. All other products would be subject to a royalty payment of 5% on the value of sales invoices.
3.3.9. With regard to the above the royalty value would be decreased to 2 and one half percent of invoiced sales from the fourth anniversary of the date on which the license commenced or will have commenced when the products were manufactured or sold.
3.4. The above are the only agreements between the two companies which are on file.
4. Correspondence between 6 August 1963 and 23 May 1968.
4.1 This section is a mixture of correspondence from the two files - D5189/4/3/1 and File No.4.
4.1.1. 6 August 1963.
By this letter from HS to Mr. L. Tcherniak it was obvious that it was part of the
negotiations to reach an agreement to appoint Chemitecnica Sintyal as a
licensee for Argentina.
In it HS proposes to halve the royalties due to Evode Ltd. to those stated in
3.1.5., double the figure having previously been suggested. These figures would
only apply to sales made in Argentina. Should other countries be involved
another agreement would have to be negotiated.
4.1.2. 13 September 1963.
This letter from LT to HS refers to letters dated 19 August and 5 September
1963 which are not on file.
HS had obviously asked for references and LT enclosed a copy of a reference
from ASUNGER S.A. which was apparently a subsidiary of CERVECERIA y
MALTERIA de CUYO S.A. and COCCHIS y HERNANDEZ S.A.
Some personal background on the company was included.
LT was keen to become a licensee of Evode Ltd. and agreed with the suggestion
that they start slowly and the minimum royalty would be paid in the first year.
4.1.3. 17 September 1963. There is a letter of the above date from Empiria Products Ltd., 140 Park Lane, London W1, written by A. R. Richards, who was a director of this company to JJEF. An approach had obviously been made by Evode Ltd. to this company during the negotiations with Chemotectica Sintyal. This letter is not on file and the reply does not make clear what was required.
4.1.4. There was so much correspondence going backwards and forwards between the
companies at this time that it was inevitable that some was mislaid. This piece
of correspondence deals with letters which went awry and those which were not
answered.
LT suggested that Migeul Tcherniak would visit Evode Ltd. as soon as it was
convenient.
4.1.5. 3 October 1963.
This letter from Chemotechnica Sintyal points out that all royalties which they
must pay are subject to 38% tax but they were prepared to pay this.
It is also obvious that they have an interest in manufacturing Evomastics and
ask for the details of new raw materials as soon as possible.
4.1.6. 10 October 1963.
A situation described in 4.1.4. arose and was corrected.
A request was made that 6x5kg samples (of what is not is not stated) to be sent
to ASUNGER S. A. It was also reported that ABADIE-VAZQUES-OTANO
S.A.C.I.F. were acting as distributors of Secomastic made by Secomastic S.R.
Ltda. In Buenos Aires under license.
4.1.7. 14 October 1963.
JJEF had kept up correspondence with Chemotecnica Sintyal while HS was on
business in Europe.
A memo of the above date from JJEF to HS throws some light on the matter of
the companies being dealt with. It was already a fact that Chemotecnica
Sintyal had an association with ASUNGER S.A. From the memo it would
appear that this company had attempted to register Trade Marks not belonging
them. Whether this was Evode`s T.M.s is not made clear but it is obvious that
JJEF does not think much of ASUNGER nor of the way that business is
generally conducted in South America.
4.1.8. 23 October 1963. JJEF sent to Allen & Overy a copy of the Chemotecnica Sintyal letter dated 6 August 1963 which referred to the tax system which existed between the two countries. A & O were asked for their opinion as Evode Ltd. would not be interested in entering into an agreement unless the full royalty was payable.
4.1.9. 25 October 1963.
JJEF replied to Chemotecnica Sintyal in general terms concerning the
manufacture of the adhesives. As negotiations were still in progress with
regards to the license he could not be any more specific. The answers he gave
were based on the reply he received from VV.
4.1.10. 8 November 1963.
This letter from A & O was a reply to the previous letters submitted by JJEF,
requesting advice concerning the tax situation. A & O advice was that
Clause 5c) should be changed awarding Evode Ltd. 5% royalty free of all
tax. As the tax deductions in the Argentine under these circumstances was
38% it was unlikely to reach agreement with Chemotecnica Sintyal. Evode
Ltd. was advised to approach the local tax inspector to clarify the matter. It
was suggested by A & O that it may be possible for Evode Ltd. to claim
unilateral relief.
4.1.11. 18 November 1963.
JJEF wrote to Chemotecnica Sintyal advising that Evode would not be able to
claim back the 38% tax imposed by the Argentine Government.
As a net 5% royalty was expected by Evode Ltd. Clause 5c) was restated quite
specifically that 5% was the minimum royalty acceptable to Evode Ltd.
The time factor as to when royalties were payable to Evode Ltd. was also
restated and Chemoticnica Sintyal was asked for their opinion.
4.1.12. 17 September - 29 November 1963.
In a series of letters and memos of the above dates ( some undated ) the
Managing Director of ASUNGER S.A. requested samples of suitable
Polevomastic for use on his yacht, for which he would take full responsibility.
Mr. K. Challenor and Dr. M. Welch were drawn into this but ultimately JJEF
refused to supply the samples on data received.
4.1.13. 29 November 1963.
JJEF wrote to Chemotecnica Sintyal on the basis of the data received from
ASUNGER. However a similar request had been received from Empiria
Products Ltd. to supply Polevomastic to this company. As this matter was
becoming confused clarification was requested.
4.1.14. 16 December 1963.
Chemotecnica Sintyal wrote to Evode Ltd. acknowledging the receipt of the
letters dated 25 October and 18 November.
On the basis of information previously provided, Chemotecnica Sintyal had
been in touch with various materials suppliers, Du Pont, Hercules etc. to
establish the rate of duty charged in Argentina on these products. They found
out that duty rates were to be charges in 1964 ( presumably at a higher tariff).
This new tariff was due to come into force on 1 January 1964 but due to
protests by the manufacturers it had been delayed until 1 May 1964.
It was obvious that negotiations were still under way as MT was due to visit
Stafford. This period of the year was vacation time in Argentina so the visit
was delayed until March - April 1964.
By this letter also it was agreed that the 5% royalty would be paid in full and
the royalty payments would begin no later than 1 January 1965.
4.1.15. 1 January 1964.
Dr. Simon agreed to the above terms.
4.1.16. 2 January 1964.
JEL wrote to A & O passing on the agreements made in the above letter and
Chemoticnica Sintyal anxiousness to conclude engrossments of the agreement.
4.1.17. 9 January 1964.
A & O replied to JEL pointing out the changes in the agreement which JJEF
wanted to see. It was suggested that two copies of the agreement be sent to
A & O so that one could be returnrd to Evode Ltd. with the corrections
included.
4.1.18. 10 January 1964.
JEL replied to the above sending two copies of the standard agreement and
letters dated 6 August 1963, 3 October 1963, 18 November 1963,
16 December 1963 and a copy of a letter received from H.M. Inspector of
Taxes.
4.1.19. 28 January 1964.
A & O replied to the above letter covering all of the points raised.
4.1.20. 3 February 1964.
JEL accepted and acknowledged the changes made in A & Os letter dated
28 January 1964. He did point out that Chemoticnica Sintyal could make
Bal-Tad and Richafix so long as the Evode agreement was in force. Should
it lapse they could continue to sell CTAs but not under the BAL trade names.
This was subject to a separate agreement.
4.1.21. 26 February 1964.
A & O wrote to Evode to advise that the engrossments had been concluded
and that they included:-
2 engrossments of the licensee agreement.
1 engrossment of the BAL agreement.
3 engrossments of all the above.
The necessary number of copies were sent on to Chemotecnica Sintyal on the
above date advising that the agreement with BAL should not be dated earlier
than the agreement with Evode.
4.1.22. 6 March 1964.
Chemotecnica Sintyal acknowledged the receipt of the above but still
protested that Clause 16 was unnecessary ( secrecy ). The present agreement
met all requirements of the Government.
4.1.24. 23 March 1964.
This letter, just addressed to Evode Ltd., was from Miguel Tcherniak advising
that the letter of 13 March cancelling Clause 16 had been received and the
signed copy was being returned to Evode.
It also advised that Mr. L. Tcherniak would arrive in UK in early May
followed by MT who would arrive by plane.
4.1.25. 2 April1964.
The signed copies of the agreements were sent to A & O by JEL.
4.1.26. 7 April 1964.
HS acknowledged the letter of 23 March and looked forward to seeing
LT and MT.
4.1.27. 15 April 1964.
The engrossments of the agreements were returned to JEL by A&O together
with the costs involved.
These were returned to Chemoticnica Sintyal on 17 April 1964 together with
the extended deletions suggested by A&O.
4.1.28. 30 April 1964. The engrossments were acknowledged by Chemotecnuca Sintyal.
4.1.29. 13 May 1964.
C.C.Cooper wrote to M. Tcherniak advising that all of the raw materials
available to Chemotecnica Sintyal locally had been tested and proved suitable
for use to manufacture adhesives to Evode specifications. It would appear that
only toluene was available in the Argentine but should the customer be
prepared to stir the adhesive before use it presents no problem.
4.1.30. 4 June 1964.
BL wrote to MT following an enquiry from Ima-Klessman (manufacturers of
edge veneering machines). This enquiry obviously referred to another South
American country but was passed on the Chemotecnica Sintyal nevertheless.
4.1.31. 16 June 1964.
Adhesives manufacture had obviously not yet begun at Chemotecnica Sintyal
as this letter from MT advises that they are still assembling equipment.
It also expresses thanks for the reception in Stafford of the CS representative
who had recently visited.
4.1.32. 18 June 1964.
This letter from MT to BL expresses thanks for the Spanish language leaflets
and labels originating from Carlos, Spain, for use in Argentina.
Mr. Peake was also going to provide drawings of the churns which were
awaited.
MT also advised that, in future, all correspondence to CS should be addressed
to:-
Casilla de Correo Central 2493,
Buenos Aires
as an office was no longer maintained at Rodriguez Pena 360.
4.1.33. 25 June 1964.
BL wrote to EP urging him to supply the drawings of the churn to CS.
4.1.34. 26 June 1964.
EP replied to the above memo advising that the drawings had been supplied by
CCC on 22 June.
4.1.35. 30 June 1964.
BL wrote to MT to say that the formulation for Evo-Stik 6317 would be
despatched immediately and that the drawings for the churn had been sent.
It advised that BL had now moved offices into the new block and that of HS
was ready for occupation although he was away from Stafford visiting the
facilities in Ireland, Portugal and Spain.
4.1.36. 2 November 1965.
This letter from CS acknowledged Evode`s of 25 October 1965 which is
missing from the file.
It stated that Mr. Ferraro of Promovi S.R.L. had visited CS and had a long
discussion about using products made by CS. It was not made clear who
Mr. Ferraro was, what the business was, what adhesives interested them nor
what usage they would be put to.
LT advised that machinery was now being installed to manufacture the
adhesives.