Reactor Supply and Collaboration Agreement with Graphit Kropfmuhl GmbH, part of AMG Advanced Metallurgical Group N.V.
Haydale Graphene Industries plc (AIM: HAYD), the Group focused on enabling technology for the commercialisation of graphene and other nano materials, has told DirectorsTalk about a collaboration agreement between Haydale Limited and Graphit Kropfmuhl GmbH part of AMG Advanced Metallurgical Group N.V. and an affiliate of Alterna Capital Partners LLC .
The Agreement
The Agreement focuses on the development of new value added nano-material products using Haydale’s HDPlas(R) functionalisation process and certain AMG graphitic feedstock material primarily from its GK mine in Sri Lanka. Through its own source mines and vertically integrated production facilities, GK produces high purity natural graphite that is known for its conductivity, lubrication, heat resistance, and bonding properties.
Haydale will initially supply an R&D reactor (HT60) and a larger capacity reactor (HT200) to GK for use under the Agreement. The specification of the HT60 is similar to that supplied to the Centre for Process Innovation in September 2015 while the HT200 is a scaled up version capable of treating 8 times that of the R&D unit, which can amount to multiple tonnes of certain GK material.
The initial contract value for the supply of the reactors is payable to Haydale on the normal machine supply basis. Subject to reaching the agreed milestones, the majority of the revenue is scheduled to be received in the current financial year and is expected to constitute a significant proportion of the Group’s revenues for the year ended 30 June 2016.
Once the reactors are installed and commissioned, the Parties will collaborate on various projects aimed at developing “Collaboration Products” for specific industrial customers in the composites, inks/dispersions, energy harvesting and lubricants sectors. In addition, the Parties have agreed to work together on commercialising certain products that Haydale has developed. Intellectual Property (“IP”) in the Collaboration Products will be owned by the party creating it, or jointly if created jointly, but in any event the parties will cross license each other such foreground IP to allow each of them to make and sell Collaboration Products.
Under the Agreement Haydale will grant a non-exclusive licence to GK to use its patented process and, on the sale of the Collaboration Products will receive a royalty income based on the net revenue received by GK, the rate and quantum of which is likely to depend on the market size and product pricing.
The reactors are expected to be delivered to a specially built GK facility in Hauzenberg, Germany by June 2016. Haydale will undertake site commissioning and provide ongoing maintenance, supply of spare parts and full technical assistance to support the operation of the reactors.
Commenting, Ray Gibbs Haydale CEO said: “We have been working with AMG for two years now and developed a close business relationship culminating in this collaboration agreement. For Haydale, this is a significant development because it opens the way for a European Centre of Excellence that can operate at scale with our plasma reactors in situ. It brings a development partner with not only sales reach but crucially a supply chain of exceptional quality and a vast array of high quality carbon based materials for use across our joint target markets. Provided that delivery of the reactors is on schedule, the income from the sale and commissioning of the reactors will underpin the Group’s expected revenue in the current financial year.”
Mr. Frank Berger, President of AMG Graphite added: “The collaboration with Haydale will contribute to AMG Graphite’s development of strategic graphene and functionalised graphite products for high end applications. We look forward to working with Haydale to develop processes and work towards producing and selling Graphene products and master batches on an industrial scale.”
