A G R E E M E N T
-
AGREEMENT made and
entered into this 31st day of May, 1929,
by
and between the FORD
MOTOR COMPANY, a Delaware corporation,
having its principal office at Dearborn in the
State of Michigan, USA., (hereinafter called the "company"),
the SUPREME COUNCIL OF NATIONAL ECONOMY (V.S.N.H.),
of the Union of Soviet Socialists
Republics, (hereinafter called "VSNH")
acting through its
Vice-chairman VALERY I.
MESHLAUK, its duly authorised representative, and
the AMTORG TRADING CORPORATION, A New York
corporation, having its principal office at
261 Fifth Avenue in the State of New York,
- U.S.A., (hereinafter
called
"Amtorg"),
-
- W I T N E S S E
T H,
-
-
WHEREAS, VSNH
through a special State Trust or Corporation, (
hereinafter called the "Trust"), to be
organised for the purpose, is desirous of
erecting in the U.S.S.R. an automobile plant or
plants for the manufacture
- therein of passenger
automobiles similar to the Ford Model "A" and of commercial
trucks similar to the Ford
Model "AA", with all improvements which
may be
embodied therein by the
Company during the term of this agreement and is
desirous of obtaining the technical assistance
and advice of the Company with respect to
the construction of said plant or plants and the
manufacturing process connected with the
production of such Ford cars and trucks;
- WHEREAS, the
Company is desirous of giving the necessary
advice
and rendering technical
assistance to VSNH in the erection of such plant
or
plants and the production
of said cars and trucks and is prepared and
disposed
to supply VSNH with
complete units of such cars and trucks and/or
parts thereof,
during the term of this
agreement as required in the development of
production
in such plant or plants;
- WHEREAS, the
purchase of Ford cars and trucks and/or parts and units
thereof for the U.S.S.R., as herein
contemplated are to be made by and
- through Amtorg.
-
- NOW, THEREFORE, in
consideration of the premises and the mutual covenants
hereinafter contained, the parties hereto agree
as follows:
- 1. The Company hereby
grants to VSNH for the period of this agreement an
exclusive license to manufacture , use and sell
in the U.S.S.R., as now
constituted,
under all present patents and future patents and
inventions owned
or controlled by the
Company or its subsidiaries covering all
materials and
component parts or units of
the Company’s model “A” cars and Model
“AA” trucks,
as well as the equipment,
tools and processes and methods of production
there
of together with the right
of utilizing any and all inventions and
discoveries
embodied in patents
obtained by the Company in the United States or
elsewhere
- in connection
therewith, and of using any and all unpatented
inventions, discoveries, methods and processes of
production employed by the Company in the production
of said Ford cars and trucks.
- Should the Company
acquire a patent or right under a patent from third
parties without the right of sub-licensing
thereunder for U.S.S.R. , it shall
use its best endeavours to secure similar rights
for VSNH.
- All inventions
and improvements made during the period of this
agree=
ment in Ford “A” and
Ford “AA” models in the plant and plants of
VSNH manufacturing said models, shall be placed
at the disposal of the company and the company
shall be granted licenses under any Letters
Patent obtained for such inventions or
Improvements.
- 2. Immediately
upon the execution of this agreement the
Company
agrees to commence
designing for VSNH a detailed plant layout and
working
project for the
construction and equipment of an assembly plant
and body shop
of sufficient size and
capacity to assemble one hundred thousand
automobiles
per year of the type of
Ford model “A” car and Ford model “AA”
truck in two
- (2) daily shifts of
seven hours each , and as soon as possible
thereafter furnish
VSNH with a completed plant
lay-out and working project together with
schedules
and specifications of
machinery and equipment required to be installed
there in, operation sheets and detailed drawings
of all sub-divisions of such assembly plant
and body shop sufficient to insure the successful
and economical assembly
on the U. S. S.
R. of said Ford models
- 3. As soon as
required by VSNH the Company shall furnish to
VSNH two or
more complete sets of
working drawings and designs of parts and
assemblies and
material analyses and
specifications covering all parts and components
of the
- latest Ford model :A:
cars and Ford model “AA” trucks to be
manufactured in the
U.S.S.R., together with
lists, detailed description and detailed drawings
of all
special equipment,
apparatus, tools, jigs and fixtures used by the
Company in
- the manufacture of
said cars in the U.S.A., as well as complete
information as
to technical methods and
processing specifications for the manufacture of
said
cars and trucks as herein
contemplated to insure the successful and
economical
- manufacture and
assembly thereof in the U.S.S.R.
- The Company shall
also keep VSNH fully advised during the term of this
agreement of all improvements in the design or
methods of production of said cars
and trucks and supply it promptly with complete
sets of working drawings
- and all other
information pertaining to such improvements
concurrently with the
introduction of such
improvements in the U.S.A.
It is understood that VSNH shall have the
right with the prior consent of
the Company, to make such modifications and
alterations in the original design
of the chassis of said Ford models in the cars to
be produced and sold
in the U.S.S.R., so as to
make them applicable to the service and road
conditions prevailing therein . Changes in body
design may be made nevertheless without
the prior consent of the Company, but the Company
shall be at all times
- informed thereof and
shall further have the right to utilize in its
own plants
any improvements made in
the Ford model “A” and Ford model ”AA” by
VSNH.
- 4. The Company
agrees, at the request of VSNH, during the term
of this
agreement. to supply and
assign for services in the U.S.S.R. experienced
and
competent technical
personnel to advise and assist VSNH in the
preparation of
plans for the construction
and equipment and in the erection of
manufacturing,
assembly and body plants
and the installation therein of the equipment
required therefore and for the instruction of the
technical personnel of VSNH and all the processes
of production connected withe the manufacture of
said Ford models “A”
and “AA”,
so as to give the technical personnel in the U.S.S.R.
full opportunity
to utilize patents,
inventions, discoveries and technical information
of the
Company.
- The type of
personnel to be supplied by the Company shall be
agreed
upon from time to time.
- 5to not more than .
The Company agrees to permit access to its
plants, fifty (50) in number during each year, to
the engineers, foreman and other employes
of VSNH for the purpose of learning the methods
and practice of manufacture and assembly in the
Company’s plants and for such purpose
participating
actively in the production
of said Ford cars and trucks therein. The
salaries
and expenses of such men
shall be borne and paid for by VSNH
The personnel assigned by VSNH to the Company’s
plants shall be
governed by the same rules
and regulations applicable to the employes of the Company,
it being understood that the admission of such
personnel shall be
limited to the usual
working hours. All reasonable facilities for the
study of
the methods and practice of
the Company shall be granted to the men
designated
by VSNH for such period of
time as may be necessary to make such men
competent
in the manufacture of Ford
cars and trucks.
- 6. It is intended
and agreed that VSNH shall reimburse and pay the
- Company for
- (a) Actual
costs (consisting of labor, material and
overhead) incurred by the Company in preparing
and furnishing drawings, designs models and plans
at the request of VSNH.
- (b) Actual
salaries as paid by the Company in the U.S.A.,
together with travelling expenses of such
personnel as may
be sent by the Company to
the U.S.S.R. at the request of VSNH
- (c) Actual
costs of service (consisting of labor and
overhead) to be rendered by the Company’s
engineers designated
- specially for
consultation as to projects of VSNH or any
portion thereof.
-
- 7. In consideration
of the rights granted to VSNH hereunder and the services
to be rendered by the Company to VSNH during the
term of this agreement as hereinabove provided,
VSNH agrees to purchase from the company through Amtorg,
or Amtorg shall purchase directly from the
Company , within a period of
four (4) years from the date of execution of
this agreement, automobile parts
and aggregates equipment in cost to seventy-two
thousand (72,000) K.D.
- Ford cars and trucks,
exclusive of tires, and the Company agrees to
sell such
parts and aggregates as
Amtorg shall, from time to time, order on the
following terms and conditions :
- (a)
- During the 1st year
the equivalent in cost of six thousand
(6,000) K.D. cars.
- During the 2nd year
the equivalent in cost of eight een thousand (18,000)
K.D. cars
- During the 3rd year
the equivalent in cost of twenty four
thousand (24,000) K.D. cars
- During the 4th year
the equivalent in cost of twenty four
thousand (24,000) K.D. cars
- (b)
- The purchase may be
distributed between complete cars
or trucks, K.D. cars or trucks, parts, materials
and components
as VSNH or Amtorg may
elect in accordance with the requirements
in the process of manufacture and use of Ford
type automobiles
in the U.S.S.R., the sum
total of such purchases to be not less
than the amount to be purchased in any given
years hereinabove
provided for. In the
event the amount of purchases made in any
given year in excess of that stipulated in sub-division
(a)
hereof, the amount of
purchases required therein to be purchased
during subsequent years shall be reduced
accordingly. It is further understood that any
manufactured or semi manufactured parts for
Ford cars or trucks either for repair
or assembly purposed purchased outside of the U.S.S.R.
by VSNH
during the life of this
agreement shall be purchased exclusively from
the Company complete and
- (c) Prices for /
K.D. cars and trucks shall be at all times be
the lowest net export prices FOB. Factory charges
by
the Company to its best
and largest dealers, plus the actual cost
of packing and transportation to an Atlantic
port,
less the cost of
assembly thereof, for K.D. cars.
-
- (d) The prices
of assembly units and parts shall be based on
the factory cost thereof and Amtorg shall pay
therefor
during the time of this
agreement, cost plus fifteen (15%)
percent. Within sixty (60) days from the date
of execu tion of this agreement the Company
shall furnish Amtorg with
a detailed list of factory costs of assembly
units and
parts as such list shall
be the basis of prices for the
first six months; thereafter, a new list shall
be furnished
semi-annually.
-
- (e) Amtorg shall
give schedule of its estimated requirements
to the Company for the first quarter two months
prior thereto
- and shall continue
to do so for each quarter thereafter during
the time of this agreement. Whenever possible
orders shall be
- placed in
approximately equal monthly quantities, it being
under stood, nevertheless, that the quarterly
schedule supplied by
- Amtorg shall not
be deemed an order for the quantities named,
but shall be subject to change in accordance with
the requirements of production in the U.S.S.R.,provided,
however, that
the purchase for any
given year shall not be less than indicated in
subdivision (a) thereof.
(f)
Payment for merchandise delivered by the Company
on dock
shall be made in cash
against presentation of the company’s
invoices and dock receipts of the port whereto
the delivery
is to be made.
- (g) The Company
shall not be responsible for delays
in delivery of merchandise due to strikes,
accidents,
fires, or any other
cause beyond its control.
- (h) The Company
will give its usual warranties as to workmanship
and material with all merchandise shipped to
Amtorg.
- 8. The cars and
trucks of the Company imported complete or in
units
shall be sold under their
original trade-mark “FORD”. The cars and
trucks to
be manufactured in the U.S.S.R.
shall bear a plate indicating that they have been
made after the Ford models.
- 9. It is the
intention of VSNH that a special state
corporation or
trust be organized in the
U.S.S.R. for the purpose of manufacturing Ford
“A”
and Ford “AA” models
and upon the organisation of such corporation or
trust all
the benefits to VSNH
arising out of the terms of this agreement shall
accrue in
favour of such state
corporation or trust, and such corporation or
trust shall
assume and fulfill all the
obligations of VSNH hereunder.
- 10. VSNH agrees
not to export to countries outside of U.S.S.R. as
now
constituted, Ford model ”A”
and Ford model “AA” cars, trucks or parts
manufactured by it.
- 11. This agreement
shall be valid for a period of nine (9) years and shall
go into effect immediately upon the execution
hereof.
- 12. Upon the
termination of this agreement any licenses
granted to VSNH
hereunder shall become non-exclusive
and VSNH or its assigns shall have the right to
the use of all patents, inventions, information
and discoveries acquired by it
by virtue of this agreement, without any
additional compensation or royalities.
- 13. Each of the
parties hereto will do their utmost to carry out
the
terms and provisions of
this agreement in the spirit thereof, so that
successful
and economical manufacture
and assembly of Ford Model “A” and “AA”
cars and
trucks in the U.S.S.R. may
be assured as soon as possible.
- IN WITNESS WHEREOF,
the FORD MOTOR COMPANY has caused these presents to
be signed by the duly authorized officer and its
corporate seal to be hereunto affixed, the
SUPREME COUNCIL OF NATIONAL ECONOMY OF U.S.S.R.,
has caused
these presents to be
executed by Valery I Moehlank, its Vice-Chairman
and
duly authorized
representative, and ANTORG TRADING CORPORATION
has caused
these presents to be signed
by its duly authorized officer and its corporate
- seal to be hereunto
affixed.
- FORD
MOTOR COMPANY
- by Peter E
Martin
- vice pres
- Henry
Ford
- SUPREME
COUNCIL: OF NATIONAL
-
ECONOMY OF U.S.S.R.
- by
Valery I Moehlank
- vice-chairman
- SEAL AMTORG
TRADING CORPORATION
- by Saul
G Brou
- President
- In the presence of
- Joseph Michael
- Charles E Sorrensen
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