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EXHIBIT 10(i)
MAKERS OF HIGH PERFORMANCE CERAMICS FOR
RESEARCH AND INDUSTRY
SALES DISTRIBUTION AGREEMENT
In consideration of the mutual obligations undertaken by Superconductive
Component, Inc., (hereafter the Principal) and Earth Chemical Co., Ltd,
INORGANIC DIVISION (hereafter the Distributor), Address: New Awajimachi Bldg.
6F, 3-14, 1-Chome, Awajimachi, Chuo-ku, Osaka 541-0047, Japan Phone:
011-06-6221-2275 Fax: 011-06-6208-3143. Under this agreement, the parties
agree as follows:
1. APPOINTMENT OF DISTRIBUTOR
Superconductive Components, Inc. hereby appoints Earth Chemical Co., Ltd
INORGANIC DIVISION as its exclusive sales distributor for the purpose of
conducting sales promotion activities and soliciting orders from potential
customers within the assigned territory of Japan. The assigned territory may
be modified at any time as mutually agreed to in writing by Principal and
Distributor.
2. PRINCIPAL'S SALES POLICIES
The prices, charges and terms of sales of the product to the distributor
shall be established solely by the Principal, which reserves the right to
modify or alter those terms at any time. The Distributor will determine the
prices, charges and terms of sales to customer in its exclusive territory.
The Distributor will work to insure that it's pricing for the Principal's
product is not unreasonably different from prices charged by competitors for
the same quality and quantity of product.
3. RESPONSIBILITY OF DISTRIBUTOR
The Distributor agrees to comply with all of Principals sales policies and
operating regulations, which may be issued.
4. PRINCIPAL - DISTRIBUTOR RELATIONSHIP
Distributor is an independent contractor and is not an employee of Principal
for any purpose whatsoever. Distributor shall have sole control in the
manner and mean of performing under this agreement. All expenses and
disbursements incurred by Distributor in connection with agreement shall be
born wholly and completely by the Distributor. Distributor does not have any
right, power or authority either "expressed or implied", to make any
warranties or create any contractual obligation on behalf of, or, in the name
of Principal. Distributor shall have the right to appoint and shall be solely
responsible, at their own risk and expense, for any independent agents that
may be engaged by Distributor in regard to this agreement. Such salespeople
and
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employees of Distributor shall not have any claim against Principal for
salaries, commissions, items of cost or other form of compensation or
reimbursement.
5. EXCLUSIVITY OF PRINCIPAL AND DISTRIBUTOR
The Principal agrees that the Distributor is its exclusive outlet for its
products in the assigned territory, All sales inquiries received directly by
the Principal from the Distributor's exclusive territory will be forwarded to
the Distributor for fulfillment. From time to time there may be customers who
prefer to deal directly with the Principal and in those cases the Principal
and the Distributor will negotiate a fair and reasonable commission on the
sales from the customer. The Distributor agrees that it will exclusively sell
the products of the Principal, being sputtering targets, superconductive and
non-superconductive powders, and Levitators-TM- and other product lines as may
be added by the Principal and mutually agreed to be added to this agreement
by the Distributor. The Distributor is not excluded from, selling the
Principal's product outside its exclusive territory but the customer
protections created by this agreement may not apply.
6. SALES GOALS IN DISTRIBUTOR'S TERRITORY
The Distributor agrees to work with the Principal to achieve mutually
acceptable levels of sales, by year, in the exclusive territory. These sales
goals are to be established by the Distributor based on information available
on market size, growth, the uniqueness of the Principal's products and
general economic conditions in the exclusive territory. These sales goals
will be included as part of this agreement in an amendment.
6. INDEMNIFICATION
Principal indemnifies and holds Distributor harmless from and against all
liability or damages, property or personal injury, caused by reason of any
Principal products (whether or not defective) or any act or mission of
Principal, except as might be caused through negligence or wrongful act of
the Distributor, their salespeople or employees. Distributor agrees to
indemnify and hold harmless Principal of and from any loss, damage, claim or
liability arising out of any failure by Distributor to perform it's
obligations under this agreement.
7. DISTRIBUTOR'S DISCOUNT
Principal agrees to discount prices for products ordered by the Distributor
and accepted by Principal, which are in accordance with the intent and
purpose of this contract. The discount will be 10% from the company's
internally published list price for the quality and volume of tile product
requested by the Distributor. From time to time the Distributor may request
special pricing in order to remain competitive in its territory and the
Principal will make every effort to comply.
8. TERMINATION OF AGREEMENT
This agreement may be terminated at will for any reason whatsoever by either
party providing thirty (30) day written notice of such election by Registered
Mail to the other party at it's
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principal business address. The termination date shall be construed as being
the postmark date on the Registered letter.
9. ASSIGNMENTS
This agreement shall be assignable by Principal or Distributor without the
prior written agreement and consent by both parties.
10. COMPLETE AGREEMENT
This agreement constitutes tile entire agreement and understanding between
the parties and supersedes all prior agreements and understandings, whether
written or oral. No modification or claimed waiver of any of the provisions
hereof shall be valid unless in writing and signed by tile party against whom
such modification or waive is sought to be enforced.
11. APPLICABLE LAW
This agreement and any amendments hereto shall be governed by and construed
in accordance with the law of the State of Ohio.
12. SEVERABLE PROVISIONS
The provisions of this agreement are sever able; and if any one or more
provisions may be determined to be unlawful, or otherwise unenforceable, in
whole or part, the remaining provisions shall nevertheless be binding and
enforceable.
In witness whereof, the parties have executed this Agreement this _____ day
of _____________, 1999.
<TABLE>
<CAPTION>
Principal: Distributor:
<S> <C>
Superconductive Components, Inc. Earth Chemical Co,, Ltd.
INORGANIC DIVISION
By: /s/ J.R. Gaines, Jr. By: /s/ Y. Nishihara
------------------------------ --------------------------------
J. R. Gaines, Jr. Y. Nishihara
Title: Vice President Title: Director
--------------------------- -----------------------------
Date: 9/20/99 Date: 11/15/99
---------------------------- ------------------------------
</TABLE>
Encls: Sales Goal Attachment
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ATTACHMENT:
SALES GOALS for Earth Chemical Co. Ltd INORGANIC DIVISION for Japan
Sales value of products sold to Earth Chemical Co., Ltd for distribution
in Japan
<TABLE>
<S> <C>
August 1999 through July 2000 (First Year) $ 24,000
August 2000 through July 2001 (Second Year) $ 48,000
August 2001 though July 2002 (Third year) $ 96,000
August 2002 through July 2003 (Fourth Year) $128,000
August 2003 through July 2004 (Fifth Year) $160,000
</TABLE>
Assumptions:
1. Superconductive Components, Inc. sales of core products, superconductive
and non-superconductive powder, ceramic sputtering targets, Levitators-TM-
and educational Kits for the calendar year 1998 were as follows:
<TABLE>
<CAPTION>
PRODUCT LINE NET 1998 DOMESTIC SHIPMENTS
<S> <C>
Superconductive Powder $55,909
Non-superconductive Powders $5,319
Superconductive Sputtering Targets $37,029
Other Ceramic Sputtering Targets $110,655
Educational Kits $15,402
Levitators $15,195
TOTAL $239,509
</TABLE>
These numbers excluded shipments of these products outside the US.
2. We believe that the market in Japan is equal to the market in the US for
these specialty products. This is based on published information on the
level of private and government spending on superconductivity in both
countries.
3. The Distributor, as a well respected, world-class manufacturer of
substrates for superconductor and other thin film applications, maintains a
large number of customer contacts in the thin film industry so that
penetration of the market for sputtering targets will proceed along
existing channels.
4. Shipments to earth Chemical through 8/31/99 are $8,344 and the current
backlog is $3,690, for a total for Year-to-Date 1999 of $12,034.
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