EXHIBIT 10.1
LETTER OF INTENT
LETTER OF INTENT, dated as of 15th day of June, 2002 by and between SHENZHEN
FUHAOHENG INVESTMENT CO., LTD, a Chinese corporation having its registered place
of business at Xxxx 0000, Block A, International Trade Plaza, Xx Xxxx Road,
Shenzhen, People's Republic of China (hereinafter referred to as Shenzhen
Fuhaoheng Investment Co., Ltd) and THERMOENERGY CORPORATION, an American company
whose principal place of business is located at 0000 Xxxxx Xxxxxxxx, 000 Xxxxxx
Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000 XXX (hereinafter referred to as
ThermoEnergy).
WHEREAS, Shenzhen Fuhaoheng Investment Co. LTD and ThermoEnergy intend to form a
Chinese joint venture company to construct and operate a pilot wastewater
processing plant utilizing ThermoEnergy's proprietary technologies, the
"Sludge-to-Oil Reactor System" (STORS) and the "Ammonia Recovery Process" (ARP)
in Shenzhen, People's Republic of China, and;
WHEREAS, upon the successful completion of the Shenzhen pilot plant project, the
Chinese joint venture company intends to pursue commercial, municipal and
industrial wastewater opportunities within the People's Republic of China
utilizing the STORS and ARP technologies, and;
WHEREAS, Shenzhen Fuhaoheng Investment Co. LTD and ThermoEnergy intend to
exchange business communications with each other upon the mutual execution of
this Letter of Intent and agree the details and content of these communications
shall be held confidential and proprietary, excluding information that is
subject to regulatory disclosure requirements mandated by the U.S. Securities
and Exchange Commission, and;
WHEREAS, it is the intent of Shenzhen Fuhaoheng Investment Co., LTD and
ThermoEnergy to conclude these communications by signing a formal joint venture
agreement during the week of September 15, 2002, and;
WHEREAS, ThermoEnergy agrees that if, for any reason, the joint venture
agreement is not signed during the week of September 15, 2002, it will continue
to negotiate in good faith with Shenzhen Fuhaoheng Investment Co. LTD for the
sole and exclusive use of STORS and ARP technologies within the People's
Republic of China until the close of business, December 31, 2002.
NOW. THEREFORE,
1. Shenzhen Fuhaoheng Investment Co. LTD will:
A. Provide a capital investment which shall be determined and be
based upon the results of a feasibility study conducted by
Qinghua University. The feasibility study shall be based upon
data provided by XxxxxxXxxxxx.
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Xxxxxxxx Xxxxxxxxx Investment Co. LTD shall have an equity
position in the new Chinese joint venture company of not less
than fifty-one percent (51%).
B. Provide the land required for the construction of the pilot
plant.
C. Secure the necessary construction permits and any and all
other documentation required by Chinese government entities
for the pilot plant's design, construction and continuing
operation.
D. Provide the required infrastructure connections with the
city's present and operating sewage-processing system.
E. Identify and negotiate, in consultation with ThermoEnergy,
with qualified Chinese general contractors for the pilot
plant's construction.
F. Assist ThermoEnergy in identifying and negotiating with
qualified Chinese equipment vendors.
G. Provide guidance and assistance in all areas of mutual
interest to ensure timely and efficient management of the
project's design, construction and implementation phases.
2. ThermoEnergy will:
A. Provide its proprietary processes known as the "Sludge-To-Oil
Reactor System," (STORS) and the "Ammonia Recovery Process"
(ARP) as its technology contribution to the new Chinese joint
venture company, which shall entitle ThermoEnergy to
thirty-five percent (35%) of the Chinese joint venture
company.
B. Provide a capital contribution, at its sole discretion, the
amount of which shall be determined prior to the week of
September 15, 2002, which will allow ThermoEnergy to purchase
up to an additional fourteen percent (14%) of the Chinese
joint venture company.
C. Be responsible for the design, construction and operating
phases of the pilot plant.
D. Provide Qinghua University with all requested and required
documentation by June 28, 2002 so as China-based technical
experts can author and publish a feasibility study which shall
verify ThermoEnergy's "STORS" and "ARP" technologies and which
shall be incorporated into the joint venture agreement.
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E. Be responsible for the selection of equipment used in the
STORS and ARP processes and the best source of such equipment.
F. Assist in the identification and selection of equipment
vendors for ancillary components of the pilot plant facility.
G. Provide guidance and assistance in all areas of mutual
interest to ensure timely and efficient management of the
project's design, construction and implementation phases.
IN WITNESS WHEREOF, the parties hereto have executed this letter of Intent as of
the date first written above.
SHENZHEN FUHAOHENG INVESTMENT CO., LTD THERMOENERGY CORPORATION
/s/ Jang Gou Jin /s/ Xxxxxx Xxxxxx
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JANG GOU JIN XXXXXX XXXXXX
GENERAL MANAGER CHAIRMAN & CHIEF EXECUTIVE OFFICER
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