DISTRIBUTORSHIP AGREEMENT
EXHIBIT
10.4
DISTRIBUTORSHIP
AGREEMENT
This Agreement made
and entered into effective as of the 9th day of December, 2007, by and
between
TECHNICAL INDUSTRIES, INC., a Louisiana
corporation having its principal place of business in Lafayette Parish,
Louisiana ("Distributor”) and SHENGLI OILFIELD
HIGHLAND PETROLEUM EQUIPMENT (USA) and SHENGLI OILFIELD HIGHLAND PETROLEUM EQUIPMENT CO.,
LTD., (collectively referred to as "Owner').
WHEREAS, Distributor is the owner and/or
Operator of facilities in Texas and Louisiana which are suitable for the
Storage, Inspection, maintenance and other services of pipe and equipment
products used in connection with the exploration and production of oil. gas and
other minerals; and
WHEREAS,
Distributor has agreed to receive, unload, store,
maintain, market, inspect and Certify
tubular products and equipment ("Tubular Products and Equipment") provided to it
by Owner; and
WHEREAS, Owner is the owner, manufacturer
and/or importer of the Tubular and Equipment Products to be marketed to
companies in the United States Of America, and other parts of the world
including, without limitation, companies engaged In the exploration and/or
production of oil. gas and other minerals; and
WHEREAS, Owner desires to engage Distributor to
serve as a distributor of its products pursuant to the terms and conditions Of
this Agreement hereafter set forth.
The
foregoing considered:
1. Owner
declares that It is owner of and agrees to deliver Products to facilities as
designated by Distributor in Texas or Louisiana. Owner shall deliver not less
than 2,000 (Two thousand) tons per month. Goods delivered to Distributor shall
be new, and shall be delivered in xxxx and undamaged condition. Owner's Products
that are not pre-Sold shall be stored at Distributor's facility.
2. Subject
to the conditions hereafter set forth, Distributor agrees to receive and unload
the Products into the designated facilities, and to store
said
product in accordance with customary
Industry standards. The parties agree that at all times ownership of the Products
shall remain with Owner, until said products are sold as
provided hereafter,
3. While
products are stored at Distributor's facilities, Distributor agrees to Service
and maintain the Products in accordance with customary industry
standards.
4. Distributor
agrees to load, unload, store, maintain, inspect and certify Products for their
intended use within
the oil and gas industry, all in accordance with accepted industry
standards. Inspection and certification shall be done prior to departure of
Products from Distributor's facility upon the sale or removal of
said products. The parties agree that lower grade products such as J, K, L, and
N grades, may not need inspection.
5. Distributor
agrees to market and sell, and Owner hereby authorizes Distributor to Market and
sell the Products delivered to Distributor under the
terms of this Agreement.
6. Owner
shall maintain title to the Tubular Product and equipment. Owner shall transfer
the title to the Distributor at the time the products are
sold by
the Distributor. Distributor is hereby granted, and shall have the
right to sell the Tubular Products
and Equipment at or above the Discounted Market Value as hereafter defined. Upon
the sale of any
Tubular Products, Distributor shall be responsible to collect the
sales price, and to remit an amount
equal to the Discounted Market
Value of the
Tubular Products and Equipment which are sold within ninety (90) days
after receipt of Tubular Product and Equipment at Distributor's
facility. If Product is not sold within ninety (90) days, Distributor shall be
extended ninety
(90) more days to pay for the Tubular Products
and or equipment.
7. For
purposes of this Agreement, the Owner wishes to be at a
pricing advantage by offering the products at a price that is competitive
with what the
Distributor's Client can obtain on the market and offer the Distributor
6% discount FOB the pipe distributor's facility in Houston,.
Texas. Price shall be agreed-up on by both parties
prior to shipping.
8. Distributor
will take delivery only of those products inspected by the Distributor and deemed by the Distributor to be
satisfactory according to API standards and or customer's pre-specified
standards. Distributor shall provide the Owner with Pre-specified Standards
before manufacturing the Tubular Products or equipment. Owner will refund the
Distributor the cost related in handling and inspecting of the rejected
pipes.
9. Storage
charges are waived for a period of one year
including loading and unloading front the date the Distributor receives
the products to be distributed at the Distributors facility.After one year
Owners Tubular Products and
Equipment will be stored at the rate of $0,40 per ton with a maximum of 400 tons
per rack and/or $165.00 per rack per month.
10. Distributor shall
have the first
right to Market and/or Sell the Tubular Products and Equipment located at
the Distributor
facilities without restrictions and without regard to any and all territorial
limitations.
Distributor agrees to utilize
it's best efforts to sell the Tubular Products and Equipment. Distributor will
nobly Owner of
his best efforts to and
demonstrating Owner's Tubular Products and equipment in order to add new clients
to the Distributor customer list.
1
11. Distributor
agrees to obtain and maintain general liability insurance relating to its
Business activities in amounts that
are
reasonably and customary, and to have the Owner named as an additional
insured under said policies.
12. Owner agrees to maintain product
liability insurance with respect to its Products with limits and with an insurer reasonably acceptable
to industry and to
the Distributor, and
to
have Distributor named as
an additional named insured under
said policies.
13. Owner agrees to defend, indemnify
and
hold Distributor harmless
from and against any and all claims arising out of the condition of the Tubular
Products and Equipment as delivered to Distributer, including, without limitation,
any and all product liability claims, as
well as
any and all pollution
claims.
14. Distributor
agrees to
defend, indemnify and hold Owner harmless from and against any and all claims
arising Out of the failure of Distributor to properly store and maintain the
Products delivered to it.
15. Owner
agrees to accept and
maintain all risk and responsibilities of ownership related to the Tubular
Products and equipment after delivery to Distributor. This
shall Include any and all losses resulting from acts of God or Other
causes which are riot the fault and wrongdoing of Distributor, and shall further
include liabilities for property taxes of
other Charges assessable against Owner or the Products based upon
said ownership.
16. Owner
recognizes that Distributor will make substantial investment in its facilities
in order to provide services under this Agreement. Accordingly Owner agrees that
it shall not terminate this Agreement for a period of three (3) years from the
Effective Date, This
Agreement may be terminated at any time after three (3) years.
Termination may be accomplished by Owner by giving Distributor six (6) months written
notice.
17. Distributor
Shall have the
right to
terminate this Agreement upon six (6) months
written notice to Owner.
18. No amendment or
modification of this Agreement, or any additional terms and conditions, shall be
valid unless evidenced in writing and signed by duly authorized
representatives of both Parties.
19, The
parties agree that each has had an opportunity to review this Agreement and to
seek advice
of counsel, that both parties have participated in the drafting of
this Agreement, and that this Agreement
shall not be construed against one party or the other as the
draft of the Agreement.
20. Each of
the persons executing this Agreement
represents and warrants that they have full right and authority to execute this instrument on
behalf of
the parties whom they purport to represent, and to
legally such party to
the
fulfillment of all
provisions
hereof.
21. In
the event any provision or any portion of any provision
of this Agreement is Inconsistent with or contrary to applicable law, rule or
regulation, said provision shall be deemed to be amended to partially
or complete
modify such provision to the extent necessary to make it comply with
said law, rule or regulation, and this Agreement, so
modified, shall remain in full force and affect.
22. In the
event of any
dispute between the
parties,
the Parties agree that if said dispute
cannot
be resolved by
negotiations within fifteen (15) days of notice given by one party to the
other of the intent to arbitrate said
dispute, the Parties shall
resort to
arbitration
in Lafayette,
Louisiana. Arbitration shall
be conducted in accordance with the rules of the American Arbitration
Association. If the parties can
agree Upon
a single arbitrator, the arbitration shall
be
held before one arbitrator. If
the parties cannot agree upon a single arbitrator, arbitration shall
be held
before three (3) arbitrators, one
to be selected by Owner, one
to be selected
by
Distributor, and a third to be
selected by the two arbitrators which
have been
chosen by the respective
parties. The
parties agree
that they shall
endeavor to select arbitrators and
complete arbitration
Within
forty-five (45) days after the
first notice of
intent to arbitrate. The decision of
the
arbitrator(s) shall be
binding on both parties,
and shall not be
Subject to any appeal or review except for the limited reasons
as set forth
by applicable Louisiana law.
23. This
Agreement shall be governed
by
the laws of the State of Louisiana. The
parties agree that the proper venue for any dispute between them to be settled In a court of
law shall be the 15th
Judicial
District Court in
and for the
Parish of Lafayette,
Louisiana,
and the parties agree
to submit to the jurisdiction of said court.
24. Any and all
notices required
or
permitted
to be given under
this
Agreement
shall be considered to be properly given when received by the party to be
notified; provided, however, the notices shall be deemed constructively
received
three (3) days after being deposited in the United States
Mail, postage
prepaid, to the following addresses:
2
Technical
Industries, Inc. Attn: Xxxxxx X. Xxxxx
P.
0. Xxx 00000
Xxxxxxxxx,
XX 00000
With Copy
to: Xxxxxx X. xxXxxxxx
Perrin,
Landry, deLaunay, Dartez, & Ouellet
P. 0. Xxx
00000
Xxxxxxxxx,
XX 00000
Owner:
Shengli
Oilfield Highland Petroleum Equipment Co., Ltd.
Attn:
Xxxx Xxxxxxxx
000
Xxxxxx Xxxx, Xxxxxxxx Xxxx
Xxxxxxxx
Xxxxxxxx, P.R. China P.C. 257091
Shengli
Oilfield Highland Petroleum Equipment (USA)
Attn:
Xxxxxxx Xxxx
7520
Homwood 1101
Xxxxxxx,
XX 00000
With Copy
to:
THUS DONE AND SIGNED
in Lafayette, Louisiana by the parties hereto after due reading of the
whole.
WITNESSES:
| TECHNICAL INDUSTRIES, INC. | ||
| /s/ Xxxxx X. Xxxxxx 12/9/07 | ||
| Printed Name Xxxxx X. Xxxxxx | BY: /s/ Xxxxxx X. Xxxxx C.E.O. Dec. 9th/2007 | |
| XXXXXX X. XXXXX | ||
| /s/ Xxxxxxxxx Xxx 12/9/07 | ||
|
Printed
Name Xxxxxxxxx
Xxx
|
| SHENGLI OILFIELD HIGHLAND PETROLEUM EQUIPMENT (USA) | ||
| Printed Name | BY: /s/ Xxxxxxx Xxxx 12/9/07 | |
| XXXXXXX XXXX | ||
|
Printed
Name
|
| SHENGLI OILFIELD HIGHLAND PETROLEUM EQUIPMENT CO., LTD. | ||
| Printed Name | BY: | |
| XXXX XXXXXXXX | ||
|
Printed
Name
|
