Smoltek intends to sign an exclusive agreement with Yageo Group

Smoltek Semi and KEMET Elec­tron­ics Cor­po­ra­tion, a sub­sidiary of YAGEO Group intends to sign an agree­ment that would grant YAGEO Group exclu­sive right to man­u­fac­ture and sell dis­crete and embed­ded capac­i­tor prod­ucts based on Smoltek’s patent pro­tect­ed tech­nol­o­gy plat­form for ultra-thin car­bon nanofiber capac­i­tors (CNF-MIM). Under the intend­ed terms of the Agree­ment, Smoltek Semi would receive a roy­al­ty on indus­try mar­ket terms based on prod­uct sales, and Smoltek Semi would receive fees from KEMET for pro­vid­ing spe­cif­ic tech­ni­cal sup­port ser­vices to KEMET for its con­tri­bu­tion to the con­tin­ued joint com­mer­cial­iza­tion of CNF-MIM-based products.

Dur­ing nego­ti­a­tions on the terms of the next step in the col­lab­o­ra­tion, Smoltek and YAGEO have iden­ti­fied dis­tinct ben­e­fits of hav­ing YAGEO mar­ket and com­mer­cial­ize dif­fer­ent capac­i­tor prod­ucts through its already estab­lished orga­ni­za­tion. This would facil­i­tate a faster and more cost-effec­tive way to bring CNF-MIM capac­i­tors to mar­ket com­pared to the addi­tion­al plan­ning and invest­ments need­ed to form a new Joint Ven­ture enti­ty, as was pre­vi­ous­ly planned by the parties.

Fur­ther­more, such an arrange­ment would allow YAGEO to more effi­cient­ly allo­cate resources to the col­lab­o­ra­tion with Smoltek as appro­pri­ate, includ­ing ongo­ing pay­ment to Smoltek for spe­cif­ic tech­ni­cal work car­ried out dur­ing the con­tin­ued joint com­mer­cial­iza­tion and indus­tri­al­iza­tion process, thus facil­i­tat­ing a faster road to mar­ket for CNF-MIM based products.

I am proud of the excep­tion­al work car­ried out by Smoltek and YAGEO dur­ing our col­lab­o­ra­tion up until this point, which has put us in a posi­tion where we are eager to dou­ble down on our efforts to bring a fam­i­ly of ultra-thin dis­crete capac­i­tor prod­ucts based on our CNF-MIM tech­nol­o­gy to the mar­ket. Enter­ing into a license and ser­vice agree­ment with YAGEO makes per­fect sense for Smoltek, as it will enable a smooth and rapid tran­si­tion into the next phase of the col­lab­o­ra­tion, with each par­ty being able to bring full com­mit­ment and resources to the table.

Håkan Pers­son, CEO of Smoltek

In the light of the above, the par­ties are now in nego­ti­a­tions to enter into a glob­al exclu­sive license and ser­vices agree­ment for dis­crete and embed­ded capac­i­tors. This agree­ment would grant YAGEO an exclu­sive glob­al right to man­u­fac­ture and sell CNF-MIM capac­i­tors, while also allow­ing for Smoltek to receive pay­ment for spe­cif­ic tech­ni­cal sup­port services.

Although the detailed com­mer­cial terms of this agree­ment still is under nego­ti­a­tion, the par­ties have agreed on the fol­low­ing struc­ture and out­lined terms of this agreement:

• YAGEO would sup­port devel­op­ment of the CNF-MIM capac­i­tors through pay­ment for ser­vices and or poten­tial invest­ments in Smoltek.
• The Agree­ment shall include a roy­al­ty-bear­ing glob­al exclu­sive license for YAGEO to com­mer­cial­ize CNF-MIM capacitors.
• The roy­al­ty rate shall cor­re­spond to indus­try mar­ket terms.
• Smoltek would, on indus­try mar­ket terms, pro­vide ser­vices in accor­dance of the agree­ment for the devel­op­ment and tech­ni­cal sup­port of the Products.
• YAGEO would poten­tial­ly make an equi­ty based invest­ment in Smoltek Semi and/​or Smoltek for a minor­i­ty stake in either com­pa­ny, such terms and struc­ture to be fur­ther dis­cussed and nego­ti­at­ed. YAGEO acquir­ing an equi­ty posi­tion in either Smoltek and/​or Smoltek Semi is con­sis­tent with the intent of the Mem­o­ran­dum of Under­stand­ing and is in the inter­est of both par­ties giv­en the antic­i­pat­ed devel­op­ment effort and asso­ci­at­ed cost to reach a viable com­mer­cial product.
• The agree­ment is depen­dent on suc­cess­ful com­ple­tion of the JDA with respect to mutu­al agree­ment on achieve­ment of Joint Devel­op­ment Agree­ment met­rics and thus com­mer­cial via­bil­i­ty of the CNF-MIM capacitors.

Both Smoltek and YAGEO believe that the adjust­ed struc­ture of its future col­lab­o­ra­tion, to be final­ly agreed upon dur­ing the first quar­ter of 2024. 

With excel­lent progress achieved so far in our col­lab­o­ra­tion with Smoltek Semi, com­bined with strong inter­est from poten­tial cus­tomers, I am excit­ed that we are plan­ning a future with CNF-MIM tech­nol­o­gy based dis­crete and embed­ded capac­i­tor prod­ucts pro­duced exclu­sive­ly by YAGEO. I am cer­tain that such prod­ucts will become an excel­lent addi­tion to our prod­uct port­fo­lio in the com­ing years.

Philip Less­ner, Exec­u­tive Vice Pres­i­dent of YAGEO

Dis­claimer: Although the par­ties are cur­rent­ly con­duct­ing the nego­ti­a­tions regard­ing the Agree­ment in good faith and with good hope of final­iz­ing the Agree­ment, the above infor­ma­tion shall not in any way be seen as a guar­an­tee regard­ing the out­come and con­clu­sions of the upcom­ing final nego­ti­a­tion phase of the Agree­ment or a guar­an­tee that the Agree­ment will be entered into by the par­ties or that YEAGEO will make any invest­ments in either Smoltek Semi or Smoltek.

Top image fea­tures Farzan Gha­vani­ni, CTO at Smoltek and Philip Less­ner, EVP of YAGEO.