EXHIBIT 10.40
AGREEMENT
This Agreement is made on the
20th day of August, 2002.
BETWEEN THE
PARTIES
A-GAS (AUSTRALIA) PTY LTD ("A-Gas") (ABN 18 066 273 247) whose registered
address is 9-11 Oxford Road,
Laverton North Victoria 3026.
AND
VIRTUAL TECHNOLOGIES (AUSTRALIA) PTY LTD ("VTPL") (ABN 17 078 419 646)
whose
registered address is 13
Malcolm Court Mount Waverley Victoria 3149.
WHEREAS:
A. VTPL has intellectual
property and product
information (the
Information)
and is licensed
to manufacture the specialty refrigerant gas known as
SOLPOWER - SP34e
(the Product).
B. A-Gas has storage,
blending and packaging
facilities for CFC
replacement
products, used
as refrigerants, located at 9 -11 Oxford Road Laverton
North
Victoria (the
Laverton Premises)
C. VTPL has existing blending and decanting equipment (the Plant) and
cylinders (the
Bulk Cylinders) for use in the manufacture and distribution
of the
Product.
D. VTPL wishes to lease the
Plant to A-Gas and to
relocate the Plant and
the
Cylinders to the
Laverton Premises.
E. A-Gas wishes to manufacture, package, distribute and sell the Product
exclusively into
the Heatcraft Group, on behalf of VTPL, and to
manufacture
and package the
Product for VTPL to distribute to customers independent to
the Heatcraft
Group.
THE PARTIES HAVE AGREED TERMS
AND CONDITIONS AS FOLLOWS:
GENERAL
1.1 VTPL warrants that it
is the holder of a license to manufacture and
distribute the Product
and is allowed
under its license to
assign
such intellectual
property to A-Gas for the manufacture of the
Product.
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1.2 VTPL will provide A-Gas with all the necessary Information
including, but not
limited to, formulation and production protocols
and
procedures to allow A-Gas to manufacture the Product to VTPL's
specification. A-Gas
undertakes to ensure
that all the Information
provided by VTPL remains confidential and A-Gas further agrees to
ensure that at all times during and after the term of this
agreement
that the Information remains protected.
1.3 VTPL appoints A-Gas as
the sole manufacturer
and distributor of the
Product for Australia
and New Zealand with
effect from the date of
this Agreement (the Commencement Date).
1.4 VTPL agrees to be
bound by the A-Gas "Terms and Conditions of Sale"
as amended from time
to time by A-Gas, a
copy of which is attached
in Appendix 1, (the A-Gas Terms and Conditions). In the event of
any
inconsistency between
the terms of this Agreement and the A-Gas
Terms and Conditions, this Agreement takes precedence.
DURATION
2.1 Subject to Clause 9, this Agreement shall commence on the
Commencement Date and
will continue for a
period of five (5) years
thereafter (the Initial Period)
2.2 The Agreement will be
automatically
renewed for further
periods of
three (3) years (the Renewal Periods), unless terminated by
either
one of the Parties
giving not less than 12 months notice, in
writing, of
termination
prior to the
commencement
of a Renewal
Period or as a result of Clause 9.
PRODUCT
3.1 The Information
supplied and assigned under this Agreement, are the
processes, procedures
and protocols associated with the manufacture
of the Product, as detailed in Appendix 2.
3.2 Under this agreement A-Gas warrants that at all times it will
manufacture and record
thee details of each batch of the
Product
manufactured at the
Laverton Premises,
in strict accordance with
only the processes,
procedures
and protocols
provided by VTPL
as
detailed in Appendix 2.
3.3 A-Gas accepts that the
Product is well established in the Australian
and New Zealand
refrigeration industry
markets, and will use its
best endeavors
to maintain the
reputation
of the Product and
the
associated brand
name SOLPOWER - SP34E and to advise VTPL
immediately there is any threat to this in anyway
whatsoever.
3.4 A-Gas agrees to supply the Product from time to time to VTPL
in
cylinders supplied
directly by VTPL, or in cylinders supplied
indirectly by its customers, for use outside of the Heatcraft
Group,
subject to these cylinders being compliant with all relevant
Australian statutory standards and regulations.
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3.5 A-Gas agrees to supply
the Product to VTPL in cylinders suitable for
export to New Zealand.
These cylinders will be supplied by
VTPL,
except where
affiliates within the
Heatcraft Group in New
Zealand
require the Product in
cylinders with a
capacity of 400KG or more,
or in
smaller refillable cylinders.
3.6 Additional products
may be added to this Agreement as agreed by both
parties from time to time.
PLANT
4.1 The Plant and Bulk
Cylinders and all other associated equipment, as
detailed in Appendix 3, remain the property of VTPL.
4.2 VTPL warrants that it is the owner of the Plant and the Bulk
Cylinders and all other associated equipment all of which is fit
for
its intended
purpose including complying with all statutory
requirements and regulations.
4.3 The Plant is to be
located at the
Laverton Premises
as soon as
is
practical but no later than 60 days following the Commencement
Date.
4.4 The relocation of the
Plant will be to VTPL's account.
4.5 A-Gas will use its best endeavors to take care of the Plant,
including
performing general
maintenance
as required in the
day-to-day use of the Plant.
4.6 Regular preventative maintenance of the Plant to ensure correct
on-going performance
and compliance with relevant safety standards
will be the responsibility of A-Gas.
4.7 Replacement of items
of Plant required to
ensure correct
on-going
operation will be paid
by VTPL, subject
to all costs for
repairs
being quoted
and agreed by VTPL in writing, prior to the
commencement of any work on the Plant.
4.8 The cost of repairs
due to damage to the Plant caused by misuse, or
accident of any kind, will be the responsibility of
A-Gas.
4.9 A-Gas will be
responsible
for insuring the Plant
against
standard
risks of fire
and other forms of damage, to the "agreed replacement
value" of $150,000-00, as detailed in Appendix 4.
FEES
5.1 A-Gas will pay VTPL a
Royalty Fee on all sales of the Product to the
Heatcraft Group.
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5.2 The Royalty Fee from
the Commencement Date is set at $4.75/kg and is
based on the current
selling pr
