HomeMy WebLinkAbout1996-03-05; Municipal Water District; 309; MOU for Capacitive Deionization TechnologiesAIB# f3 0 7 TITLE: APPROVAL OF MEMORANDUM OF
UNDERSTANDING FOR THE DEVELOPMENT,
MTG. 03/05/96 DEMONSTRATlON AND COMMERClALlZATlON OF
CAPACITIVE DElONlZATlON TECHNOLOGIES FROM THE DEPT. CMWD LAWRENCE LIVERMORE NATIONAL LABORATORY
RECOMMENDED ACTION:
CARLSBAD MUNICIPAL WATER DISTRICT -
CITY MGR-
Adopt Resolution No. 9&G approving a Memorandum of Understanding for the
Development, Demonstration and Commercialization of Capacitive Deionization Technologies
from the Lawrence Livermore National Laboratory with Christiansen Consulting, Kansas
Technology Enterprise Corporation, Marley Cooling Tower Company, and Mid-America
Commercialization Corporation.
ITEM EXPLANATION:
The capacitive deionization process using carbon aerogel electrodes for use in water
desalination was invented at the Lawrence Livermore National Laboratory. On December 5,
1995, a presentation was made to the Board regarding this water desalination process. Based
on the presentation, the Board authorized staff to proceed with investigating the technology
and pursue a memorandum of understanding (MOU) with other parties interested in
developing this water desalination process.
The purpose of the MOU is to form a strategic alliance between parties interested in creating
a basis for action for the development, demonstration, and commercialization of capacitive
deionization technologies. The MOU contemplates that the City/District will put forth its best
efforts to facilitate the demonstration of the technology under appropriate contractual
relationships by providing:
. Suitable sites . Utility services . Needed funding and regulatory approvals
The City/District will consider future appropriate contracts, however, no specific funding level
nor any funding level at all is committed by this MOU.
An MOU has been prepared that includes an October 12, 1995, letter of intent from the
Lawrence Livermore National Laboratory to participate with the strategic alliance. Four other
parties have now signed the MOU and include:
Christiansen Consulting of Carlsbad, California
The Kansas Technology Enterprise Corporation of Topeka, Kansas
The Marley Cooling Tower Company of Kansas City, Kansas
The Mid-America Commercialization Corporation of Manhattan, Kansas
FISCAL IMPACT:
This action has no financial impact at this time. However, subsequent action may require the
Board to make a determination on the level of fiscal involvement. The District’s participation
may be in kind services or involve an appropriation.
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Page 2 of Agenda Bill No. 3 0 c/
ENVIRONMENTAL:
There are no environmental impacts with the MOU.
EXHIBITS:
/# .iwd44%oh no, * ‘jab -
2s Memorandum of Understanding document.
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RESOLUTION NO 926 ‘-
A RESOLUTION OF THE BOARD OF DIRECTORS CARLSBAD
MUNICIPAL WATER DISTRICT OF CARLSBAD, CALIFORNIA, APPROVING
A MEMORANDUM OF UNDERSTANDING FOR THE DEVELOPMENT,
DEMONSTRATION, AND COMMERCIALIZATION OF THE LAWRENCE
LIVERMORE NATIONAL LABORATORY
WHEREAS, a Memorandum of Understanding (MOU) has been prepared concerning the
Development, Demonstration, and Commercialization of Capacitive Deionization Technologies from the
Lawrence Livermore National Laboratory as shown on Exhibit “1”; and
WHEREAS, four parties have signed the MOU and include Christiansen Consulting of
Carlsbad, California; The Kansas Technology Enterprise Corporation of Topeka, Kansas; The Marley
Cooling Tower Company of Kansas City, Kansas; and the Mid-America Commercialization Corporation of
Manhattan, Kansas: and
WHEREAS, the purpose of the MOU is to have the parties work together toward mutually
beneficial objectives, with the understanding that the MOU does not in itself constitute a binding agreement
on any party.
NOW, THEREFORE, BE IT RESOLVED, by the Board of Directors of the Carlsbad Municipal
Water District as follows:
1. That the above recitations are true and correct.
2. That the Memorandum of Understanding between Christiansen Consulting, the
Kansas Technology Enterprise Corporation, the Marley Cooling Tower Company, the Mid-America
Commercialization Corporation, and Carlsbad Municipal Water District as shown in Exhibit “1” is accepted.
Ill
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3. That the President and the Secretary are authorized to execute the MOU.
PASSED, APPROVED AND ADOPTED at a special meeting of the Carlsbad Municipal
Water District held on the 5th day of MARCH , 1996, by the following vote to wit:
AYES: Board Members Lewis, Nygaard, Finnila, Hall
NOES: None
ABSENT: Board Member Kulchin
ATTEST:
ALETHA L. RAUTENKRANZ, Secretary
(SEW
CMWD 95-302
- AEMORANOUM OF UNDERSTAJUDl,:
FOR THE DEVELOPMENT, DEMONSTRATION AND COMMERClALKATlON OF
CAPACITIVE DEIONKATION TECHNOLOGIES
FROM THE WURENCE LIVERMORE NATlONAL UBORATORY
/ /
/
This Memorandum of Understanding (MOU) defines the basis and intent of a pTsed
strategic alliancu between: I
. Chrfstiansen ConsuGing (CC) of Carisbad, CalHorn&
l The CGy of Caffsbad, CaGfomiaICarlsbad Municipal Water OM&t (City);
l The Kansas Tech- titerpdse Corporation (KIEC) of Topeka, Kansas;
l The lularley Cootfig Tower Company (MCI) of Kansas CGy, Kansas; and
l The Mid-America CornmerciaGzation Corporation (G&CC) of Manhattan, Kansas
This MOIJ and the attached OdOber 12 letter from the Lawrence Llvefmofe Natiial
Laboratory (LLNL) serve to express the Interests and intention of the parties, hereinafter
referred to as stakeholders, to work together toward defined mutuaGy beneficial objectives.
Accordingb, G creates a basis for action, but doe” not in itself constitute a binding agreement
on any party. Binding agreements will tie the subject of separate, mutuaGy agreed, written
contracts, Mh orwithkwt reference to this MOV.. . :
The strategic aG&nce outlined by this MOU may be extended to include other strategic
patin as appropriate and Mu* agreed.
OBJECTWE . _. . .
The obj&be of this aGiance is to develop; demonstrate and commerciaGze certain water
desaiinahi and purification technologies through the formatbn of a new Kansas Limited
Liability Corporation, tentatively named Water Technologies, Inc. (VVIl). Specifii, this
ali- v&~t be conducted ,in a manner analogous to a limited research and devebpment
partnership. Accordingly, VVTl wiG seek to’ develop ‘and commercial&e water treatment
applications of LLNL’s capacitive deionizatii wGh carbon aerogel technologies (CDCAT),
prospe&ety in association with relevant ozonatiin technobgbs.
To accomplish the above objective, the proposed neM company wit . .
l devekp appropriate strategic and business #a&;
l identify and develop market appliibns for the ex&ting and new, &ted
technokgies;
l amdud Mated aMract research;
l conduct related product and process devebpment;
l subcontract services, as needed;
l conduct related market research; and
l undertake the marketing arid business actions needed to demonstrate and
commercialiie the technologies.
Initial priority wGi be given to devebpment and demonstration of the techndogy, tentativety in a
two step plan. Step 1 will invofve development of a suGabfy sized pGot plant by LLM, and
Step 2 wG1 involve scaleup of the pGot plant to a commerciaf scale facGii of a&it 1,000,000
gal/day capacity. Cartsbad, CaGfomia is the proposed site for both Steps.
EXHIBIT 1.
VVTtMOU-PAOEZ
Building upon the carbon aarogel technologies developed at LLNL and potentielty enhancing
them with state of the art ozonatbn technologies devebped by or with MaflayozOne, the
company will develop and commerciallze water desalination and purBcatbn systems.
Purifbatbn will encompass cleanup of polluted water as wel as disinftibn of potable water.
PURPOSE i
The purpose of this Initiative is to meet identifiible market needs for the mutual benem of all
tnvolved stakeholden. Those stakeholders include al of the above named entities.
Specifical~
l UV’B will seIve as a vehicle to integrate the core competeties of the stakehokters, and to
provide an operational framework for further technical and market devebpment of the
carbon aemget technologies in fresh and polluted water treatment appllcatbns. As such,
VvTt will seek appropriate license agreements from LLNL, and establish a multiparty
cooperatiie development agreement across all the parties, This tatter agreement wii define
ownership and rights associated with any new developments undertaken through the
strategic alliance. wnls purpose is to achieve substantial growth in revenues and profits to
accrue to the benefR of the stakeholders. This will be done by nxilttzing the commercial
potential of the technologies, and furthering additional, retied research and discovery.
l CLNL will beneR through the commercialiiatbn of its intellactual property on its research
investment to provide funds for redeployment against Its institutional mission. This will
primarily be done by realMion of financial returns, that ta. license fees and royalties. LLNL
will also enjoy the racognitii and satisfactkxt associated with the successful
oommemialiiatbn of its technologies in ways that meet imp4ant social, environmental and
market needs.
l KTEC will effectiiety serve as the entity providing overall coordii between, and
accountabilii to the other stakehokters. KTEC will also faciliie cooperatbn across other
relevant elements of the Statewide KTEC network. KTEC will share ln the financial returns
from the venture through both equity and/or royalty interests.
l WCC will provide management support for the venture. provtding general management
rasources and coordinating strategic and business planMg, abng with tinandng. MACC
wilt also pmvida accass to oftka and admintstrative support for WTl withb the Kansas
Entrapreneurtal Center p&r to establishment of a dadkxMed Wft fackity. MACC WI also
share in the ttnancial returns from tha venture through both equtty and/or royalty interests.
l CC will continue to provide relevant expertise and effozt to the venture, particularty for
market development and marketing of water desalinatbn and treatment applications. In
addition, CC may faciie the introductiin of investors ‘rrto the venture, and assist in all aspeds of commerclatizatbn. CC will also share in the financial returns from the venture
through both aqulty and/or myatty interests.
l MC1 will pmvtde relevant technical and marketing expertise, patilarty relating to the
integration of ozonatbn with the carbon aerogel desalination tachnobgies. MCT will beneffi
by acquiring preferential rights to commercial use of tha technobgiis for cooling tower
appfbatbns. h4CT will also gain through equity and/or myadty interests In the venture.
wit MOU - PAOE 3
l The City will facilitate the demonstratbn of the technology under appropriate contractual
relationships by providing suitable sites, utility linkages, and facilitating needed funding and
regulatory approvals. The City will beneffi by becoming the first site to reduce the
technology to practice on a commercial scale, thus securing a needed additbnal Suppb Of
fresh water. However, it is noted that: 1
A. The City or District will consider appropriate future contracts.
6. No specifii funding level or any funding at all is committed by this MCU.
C. tt is nd’the intent of this MOU to restrict the District’s or Ciis exercise of
governmental powers including establishing fees, licenses, costs or other
appropriate procedures.
SCENARtO
The following outlines the scenario upon which this alliance is expected to be based.
1. A new Kansas corporation, tentatively named Water Technologies, Inc. (WTl), will be
founded with a mission consistent with the objective and purpose cited above, that is,
devebpment and commercialiiatii of new water desalinization and pudfrcatii
technologies. CC, KTEC, MACC, and MCT will become Members if WTl is formed as a
LLC, or shareholders if formed as a X’ Corporation. Relative sharaholdings or equity
interests will be based upon a retatiie valuation of contriiutions of each stakeholder.
Other equity investors may also be included as members or shareholders in the
corporatii, as deemed appmprtate by the initial stakeholders.
2. WTl ‘will negotiate an appropriate license agreement wiht LLNL for field of use
appliwtiis of the carbon aerogel technologies. Wll wii also negotiate related
contracts for additional research and devebpment work. WTl will also negotiate an
appropriate development agreement with MCT relating to ozonation technobgiis.
3. lnitiilly, WTTs offi will be located within the existing Kansas Entrepreneurial Center
(KEC). lt is intended that WTl wii ultimatety establish a new technobgy development
and productton design faCnity ln Kansas and a production facility in Carlsbad,
caiifomia.
4. WTt wii be expected to further develop the technology through collaboration wtth the
WIT’s stakehotders vta the strategic alTiincas created for this venture. WTl wii also
underlake market development and Com~rciarKdkn of the related technologies
through joint ventures, cooperative development or other strategic alliinces with large
corporations possessing the financial and technical resourcas needed for success.
5. A fwe yaar business plan for WTTs development will be cooperatiiety developed. lt will
focus on attaining growth in both sales volume and proftt, with particular emphasis on
meeting industry needs for water puriftication.
The plan wtll also incorporate a strategy to enable the exit of the stakeholders and/or
initial investors in a fnre to seven year time frame. This may be done via an option
exercisable amongst the parties, according to a predetermined and pre-agreed formula.
.
WrtMOlJ-PAW4
Alternatively, I could be accomplished by establishment of a liquid market for shares in
the company.
As outlined above, the stakeholders Intend to work together to realiie the above concept.
specifc actions will be dependent upon negotiatbn of a contract between the stakeholders to
define the terms under wWhappmpriate steps will be taken.
It is expected that all concerned wili receive appmpriate financial returns and other benefds for
their contributions. These could be in the form of equity, myaltiis and/or license fees, as
mutually agreed by ati stakeholders. tt is also expected that the non-financial contributions of
the equity partners wii remain proportionately in balance over time in order to sustain relative
8quity positions.
Although a complete timetable is yet to be established, alt parties consider time is of the
essenc8, and intend to proceed expeditiousty.
.
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-, wn MOU - PAoE II
AGREED this day of January 1996:
CARLSBAD MUNICIPAL WATER DISTRlCT, a municipal corporation Of the State of California /
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By:
Executive Manager or President, Board of Diractors
Date:
ATTEST:
Aletha I. Rautenkranz
CHRISTIANSEN CONSULTlNG
Qk
Byz Don Christiansen, Proprietor
KANSAS TECHNOLOGY ENTERPRISE CORPORATION
MARLEY COOLING TOWER COMPANY
By: Richard Landon, Vita President
MID-AMERICA COMMERClALlZATlON CORPORATION
=x--
Byz Ronald Sampson, President
Lawrence Livermore National Laboratory
lndus trial Partnerships & Commerciallza t/on
/ od0ber 12, i995
LIC9S-138
Don Christiansen
Christiansen Consulting
P.O. Box 2563
Carlsbad, CA 92018
Re: Proposed Development and Commercialization of Water Treatment
Applications of LLNL’s Carbon Aerogel and Capacitive Dionization
Technologies by Christiansen Consulting; the Kansas Technology
Enterprise Corporation; Marleyozone and Mid America
Commercialization Corporation (MACC)
Dear Mr. Christiansen:
This letter confirms that LLNL is very interested in working together with the above named parties regarding the subject matter through Licensing and possible
LLNL “Work for Other” agreements. Please be advised that the level of LLNL’s continuing participation is always subject to approval of the Department of Energy. -
We believe your groups contemplated scale up of the CD1 Technology and field demonstration for Commercial/Industrial use is important as the next step in
bringing this technology to practical reality.
Please direct all business questions including Licensing matters to the attention of Bill Grant.
Sincerely,
&kc* b+ David C. Conrad Industrial Partnerships & Commercialization
Utiedty of California l P.O. Box 908 L-795 l Livermore, CA 94551 l Telephone (510) 422-6416 l Facsimile (510) 423-8989
, e
February 29, 1996
TO: KATHLEEN SHOUP, CITY CLERK’S OFFICE
FROM: William E. Plummer, District Engineer
MEMORANDUM OF UNDERSTANDING - LAWRENCE LIVERMORE NATIONAL
LABORATORY - CMWD PROJECT NO. 95-302
Attached are five original copies of the subject copies. Upon approval and execution,
please return four copies to the District for further processing. One copy should be
retained at the City Clerk’s Office.
If you have any questions or comments, please contact me at ext. 126.
Thank you,
v?
&G- fly&
ILLIAM E. PLUMMER, P.E.
District Engineer
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CMWD 95-302