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EXHIBIT NUMBER 10.18
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PACIFIC LITHIUM LIMITED
(THE SUPPLIER)
A N D
BEIJING C&K DEVELOPMENT CO. LIMITED.
(THE DISTRIBUTOR)
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DISTRIBUTION AGREEMENT
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AGREEMENT dated the 10th February 2000
PARTIES
1. PACIFIC LITHIUM LIMITED at Auckland, New Zealand ("PLL")
2. BEIJING C&K DEVELOPMENT CO. LTD. of Beijing, People's Republic of
China. ("The Distributor")
BACKGROUND
A. PLL wishes to appoint a distributor to sell certain products in the
Territory.
B. PLL has agreed to appoint the Distributor the rights to distribute the
Products to customers within the Territory upon the following terms and
conditions.
AGREEMENT
1.0 INTERPRETATION
In this agreement unless the context otherwise requires:
CUSTOMER means a client purchasing the Products from the Distributor.
INTELLECTUAL PROPERTY RIGHTS means PLL's own or licensed business
names, trade marks, trade names, copyright, patents, registered
designs, industrial processes, trade secrets, know-how and other
intellectual property rights used in relation to the processing,
manufacture, sale and supply of the Products from time to time.
PRODUCTS means the products listed in Schedule 1 and such other
products which the parties may from time to time agree upon.
TERRITORY means China.
1.1 The plural shall include the singular and vice versa.
1.2 References in this agreement to parties, sections, clauses and
schedules are references to parties, sections, clauses and schedules
respectively of this agreement.
1.3 Expressions cognate with defined expressions have meanings
corresponding to those defined expressions.
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1.4 Headings are used as a matter of convenience only and shall not affect
the interpretation of this agreement.
2.0 APPOINTMENT AND TERRITORY
2.1 PLL appoints the Distributor its non-exclusive distributor to make
sales of the Products in Part A of SCHEDULE 1, and exclusive
distributor to make sales of the Products set out in Part B of SCHEDULE
1, to Customers in the Territory for a period of 6 months subject to
the following provisions of this agreement.
2.2 PLL shall not compete with the Distributor for the sale of the Products
in the Territory and shall refer all purchase enquires from Customers
in the Territory to the Distributor.
3.0 DISTRIBUTION
3.1 The Distributor shall at all times during the term of this agreement,
use its best endeavours to carry out the activities in Schedule 2 and
to maximise sales of the Products in the Territory.
3.2 The Distributor shall act in the best interests of PLL and protect the
interests of PLL so far as the Distributor is reasonably able to do so.
3.3 The Distributor shall conduct its activities in accordance with
accepted best international industry practice and comply with all laws,
regulations and rules of any competent legal authority in the Territory
relating to the subject matter of this agreement.
3.4 Except in so far as such representations or warranties arise or are
implied by law the Distributor shall not make any representation or
give any warranty in respect of the Products other than those set out
in the specifications provided by PLL from time to time.
3.5 The Distributor undertakes to apply for and to use its best endeavours
to obtain as promptly as possible, and maintain, all approvals that may
be necessary, from the competent Health or other Governmental
Authorities in the Territory, in order to permit the importation and
distribution of the Products in the Territory.
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4.0 PAYMENT OF PURCHASE PRICE AND COMMISSION
4.1 The Distributor shall pay the purchase price for the Products to PLL
within 30 days of invoice by PLL by telegraphic bank transfer to PLL's
nominated bank account.
4.2 PLL reserves the right to charge interest on overdue accounts at rates
determined from time to time.
5.0 DELIVERY, RISK AND INSURANCE
5.1 PLL shall use its best endeavours to promptly supply the Distributor
with all the Distributor's requirements of the Products. PLL shall not
be liable to the Distributor or Customer unless caused by PLL's gross
negligence or deliberate default.
5.2 PLL shall deliver the Products to the Port of Auckland at the cost of
PLL.
5.3 Risk of any loss or damage of or to the Products supplied by PLL shall
pass to the Distributor at the time of delivery of the Products by PLL
or by PLL's agent or courier.
6.0 MARKET INFORMATION
6.1 The Distributor shall provide PLL with monthly sales reports, marketing
reports along with such other information (if any) which PLL may
reasonably require relating to the marketing and sales of the Products.
6.2 The Distributor shall notify PLL, and PLL shall notify the Distributor
(to the extent that is relevant to the Distributor), of any information
or announcements coming to the Distributor's or PLL's attention (as the
case may be), as well as the origin of such information or
announcement, which relate to the:
(a) Effects which are or could be attributed to the Products or any
components of the Products;
(b) Characteristics which could impair the safety or efficiency of
the Products or any component of the Products;
(c) Complaints concerning the quality or packaging of any Products.
6.3 PLL may during normal office hours and on reasonable notice inspect
such of the Distributor's records as may be necessary to verify the
accuracy of the Distributor's sales reports provided to it.
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7.0 TERRITORY
7.1 Subject to clause 7.3, the Distributor shall not export or distribute
the Products outside the Territory nor shall it supply any Customer who
may in turn be supplying the Products outside the territory.
7.2 The Distributor shall refer to PLL all inquiries which it receives from
persons outside the Territory regarding the supply of Products.
7.3 Nothing in this agreement shall prevent:
(a) the Distributor delivering the Products to persons outside the
Territory where the order was placed by a Customer in the
Territory; nor
(b) an exclusive distributor of PLL from delivering the Products
to persons in the Territory where the order was placed by a
Customer in the territory granted by PLL to the exclusive
distributor.
8.0 SUB-DISTRIBUTORS
8.1 The Distributor shall not without the prior written consent of PLL
(which consent shall not be unreasonably withheld) appoint any
sub-distributors of any of the Products or agents to sell any of the
Products.
8.2 Sub-distributors or agents (if any) approved by PLL for the
distribution of the Products shall be bound by the same obligations
assumed by the Distributor under this agreement and the Distributor
shall procure that such sub-distributors or agents adhere to the terms
and conditions of this agreement.
9.0 CONFIDENTIALITY
9.1 The Distributor shall not during the term of this agreement or at any
time after its termination, use, exploit or disclose to any person
apart from its employees, sub-distributors or agents (if any) any
confidential information supplied by PLL or otherwise acquired by the
Distributor relating to the Products or any modification or improvement
to the Products except to the extent that such information is in the
public domain otherwise than as a result of a breach by the Distributor
of the provisions of this section.
9.2 PLL shall not during the term of this agreement or at any time after
its termination, use, exploit or disclose to any person apart from its
employees any confidential information supplied by the Distributor or
otherwise acquired by PLL relating to the terms of this contract and
the operating procedures of the Distributor except to the extent that
such information is in the public domain otherwise than as a result of
a breach by the Distributor of the provisions of this section.
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9.3 Either party shall only disclose such confidential information to its
employees, sub-distributors and agents (if any) to the extent it may be
necessary for the performance of this agreement. Either party shall
take all necessary steps to ensure that the confidentiality of the
information so disclosed is safeguarded.
10.0 TERMINATION
10.1 Either party may terminate this agreement during or at the conclusion
of the 6-month trial period by written notice to the other party
advising of its intention to so terminate and specifying the date of
termination.
10.2 Either party may immediately terminate this agreement at any time by
written notice to the other:
(a) If the other party shall default in the performance of any of
its obligations under this agreement and (if capable of
remedy) shall fail to remedy such default within 30 days of
receiving written notice specifying such default and requiring
such default to be remedied except in the case of a failure by
the Distributor to meet its obligations in Schedule 2;
(b) If the business activities of the other party cease or are
suspended;
(c) In the event of the liquidation or insolvency of the other
party;
(d) In the event of the appointment of a receiver or trustee of
the property or any part thereof of the other party;
(e) In the event of the other party making any assignment for the
benefit of its creditors; or
(f) If the other party makes any arrangement with its creditors;
(g) In the event that any license required to be held by the
Distributor for the proper conduct of its business is
canceled, suspended or otherwise lost.
10.3 In the event that the Distributor's tasks in the attached Schedule 2
are not met to PLL's expected level, PLL may terminate this agreement
on 10 working day's notice.
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11.0 EFFECT OF TERMINATION
11.1 Following termination of this agreement under clause 10.1 above, all
obligations and liabilities of the Distributor and PLL under this
agreement shall henceforth cease and determine but any accrued rights
and entitlements shall remain.
11.2 Termination of this agreement shall not affect any provision of this
agreement which is intended to continue after termination.
11.3 Upon termination of this agreement for any reason, the Distributor
shall:
(a) Cease acting or purporting to act as the Distributor of PLL;
(b) Upon request of PLL provide PLL with full particulars of all
unfulfilled orders and inquiries by the Distributor in respect
of the Products;
(c) Deliver up to PLL, without retaining copies of the same, all
information and other written materials of a confidential or
proprietary nature relating to the Products in the possession or
power of the Distributor;
(d) Deliver up to PLL or destroy, as required by PLL, any advertising
or display materials featuring or referring to the Products.
12.0 LIABILITY
12.1 PLL warrants only that the Products meet the specifications set by it
at the time that the Products leave PLL's gate.
12.2 The Distributor shall hold PLL harmless and full indemnified for and
against all costs, damages, injury, expenses, liabilities and claims
(whether in tort, contract or otherwise) brought against or suffered by
PLL indirectly or directly or directly in connection with this
agreement or the Products (including, without limitation, those arising
out of the quality, marketing or use of the Products) except where such
costs, damages, injury, expense, liability and claims arise from the
acts of PLL.
12.3 The liability of PLL to the Distributor (whether in tort, contract or
otherwise) in respect of any matter touching or concerning the
Products or this agreement is hereby limited to the price of the
Products to which such claim relates.
13.0 FORCE MAJEURE
13.1 Neither party shall be liable for any failure to perform or for any
delay in performing any of its obligations under this agreement where
such failure or delay is occasioned or caused by any event beyond such
party's reasonable control.
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14.0 INTELLECTUAL PROPERTY RIGHTS
14.1 The Distributor shall not at any time assert any rights of any nature
in respect of the Intellectual Property Rights.
15.0 WAIVER
15.1 All the original rights, powers, exemptions and remedies (together
called "Rights" in the remainder of this section) of both parties under
this agreement and otherwise shall remain in full force and effect
notwithstanding any neglect, forbearance or delay in the enforcement of
the Rights by either party.
15.2 Neither party shall be deemed to have waived any of its Rights, unless
such waiver shall have been made in writing by an authorised officer
and any such waiver, unless the contrary shall be expressly stated,
shall apply to and operate only in a particular transaction, dealing or
matter.
16.0 NO ASSIGNMENT
16.1 Neither party may assign any of their rights or obligations under this
agreement without the prior written consent of the other party. Any
change in the effective control or management of a party shall be an
assignment which requires the prior consent of the other party.
17.0 DISPUTE RESOLUTION
17.1 In the event of any dispute or difference arising from or in connection
with this agreement, both parties shall use their best endeavours to
settle such a dispute or difference in an amicable manner. If the
parties are unable to resolve the dispute in such a manner, the dispute
may be referred to an independent person agreed upon by the parties,
which person shall be acting as an expert and not as an Arbitrator, and
accordingly the provisions of the New Zealand Arbitration ▇▇▇ ▇▇▇▇
shall not apply.
17.2 This agreement shall be governed by and construed in accordance with
the laws of New Zealand. The parties agree to submit to the exclusive
jurisdiction of the Courts of New Zealand in the interpretation and
enforcement of the provisions of this agreement.
18.0 NOTICES
18.1 Any notice to be served by either party on the other party shall be
served at the address beside the name of PLL and the Distributor or at
such other address as may be specified by the relevant party from time
to time.
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19.0 RIGHT TO RENEW
19.1 Provided PLL (acting reasonably and fairly) considers that the
Distributor has performed all its obligations under this agreement in
full, the market for the Products in the Territory is sufficiently
worthwhile, PLL shall grant a renewal of this agreement for a longer
term agreement on PLL's usual terms (which shall include minimum sales
levels to be met by the Distributor).
19.2 The Distributor acknowledges that PLL may require the Distributor to
reasonably establish that it is able to service the Territory with
regards to the exclusive Products, to maintain that exclusivity on
renewal. If PLL is not reasonably satisfied, it may, at its option,
grant the Distributor non-exclusive distribution rights to those
Products.
EXECUTION BY THE PARTIES
SIGNED FOR AND ON BEHALF OF )
PACIFIC LITHIUM LIMITED by )
/s/ ▇▇▇▇ ▇▇▇▇▇▇ 10.2.2000
▇▇▇▇ ▇▇▇▇▇▇
ASIAN BUSINESS MANAGER
SIGNED FOR AND ON BEHALF OF )
BEIJING C AND K DEVELOPMENT )
CO. LIMITED by )
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ 10.2.2000
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GENERAL MANAGER
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SCHEDULE 1
PRODUCT LIST
PART A
- Lithium Carbonate
- Other lithium based compounds as developed from time to time.
PART B
- Lithium Manganese Cathode Materials
- Electrodes for lithium polymer battery cells
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SCHEDULE 2
C&K 6-MONTH SCHEDULE OF RESPONSIBILITIES - (ENDING AUGUST 2000)
MONTHS ACTIVITIES
Feb-March 1 Visit Chinese lithium battery manufacturers
2 Prepare cathode sample for testing at China Battery ▇▇▇▇▇▇▇▇▇
▇ ▇▇▇▇▇ market research - managed by ▇▇▇▇ ▇▇▇
1 Receive and analyze Institute report
April-May 2 Deliver cathode sample materials
3 PLL cathode material presentation
June-July 1 Visit Chinese lithium battery manufacturers
2 China market research - managed by ▇▇▇▇ ▇▇▇
