Graphite One Enters Into Agreements Providing Exclusive Access to Industry Leading Anode Manufacturing Technology
Execution of the Graphite One-Chenyu Agreements marks key step in providing the knowledge base for U.S. Anode Active Material (“AAM”) manufacturing at G1’s planned Ohio AAM facility
Leading AAM manufacturer grants exclusive license to the North American market
Graphite One announces grant of long-term incentive awards
VANCOUVER, BC, Oct. 21, 2024 /PRNewswire/ – Graphite One Inc. (TSXV: GPH) (OTCQX: GPHOF) (“Graphite One”, “G1” or the “Company”), planning a complete domestic U.S. supply chain for advanced graphite materials, announced today that Graphite One Products Inc., an indirect, wholly owned subsidiary of G1 incorporated in Delaware, has signed a technology license agreement and a consulting agreement (collectively, the “Agreements”) with Hunan Chenyu Fuji New Energy Technology Co. Ltd. (“Chenyu”), an Anode Active Material (“AAM”) manufacturer headquartered in Changsha City, China that currently supplies qualified AAM to lithium-ion battery producers. The Agreements are an important milestone for G1 in bringing leading technology in AAM manufacturing to the U.S. domestic supply chain for battery materials.56
Anthony Huston, CEO of Graphite One, said :
The United States has zero commercialization of synthetic anode battery materials. The execution of these Agreements represents a critical step in creating domestic supply for the lithium-ion battery materials,
“Supplying proven products to the North American battery material supply chain will give G1 a competitive edge by allowing rapid entry into a market where technology is developing quickly.”
The Agreements give G1 access to critical AAM technology from an experienced AAM supplier to major battery manufacturers on a commercial basis. AAM technology is evolving rapidly as battery makers require fast charging, high density, and long-life battery specifications and G1 expects to keep pace with this advancement.
The Agreements are strictly fee-for-services arrangements, and provide no direct or indirect equity in G1, no representation in the management or Boards of Directors of G1 or any of its affiliates, and no direct or indirect rights to control the projects of G1 or any of its affiliates. It is noteworthy that technical license agreements have been used for EV battery development by such companies as General Motors1 (NYSE: GM) and Ford.2 (NYSE: F).
Subject to financing, G1 is planning to construct a commercial AAM facility using this technology at its Warren, Ohio property.
The Chenyu Agreements include:
- Technology License Agreement: Chenyu grants an exclusive license to certain AAM technologies in return for the payment of royalties applied to net revenues received by G1 from the sale in each calendar quarter of AAM products manufactured using the technology;
- Consulting Agreement: Chenyu will provide:
a. Advice and guidance in designing, constructing, commissioning and operating the Ohio AAM plant in return for the payment by G1 of milestone fees which track events progressing from the commencement of work on the plant by hiring an engineering, procurement and construction management firm through ultimately to G1 successfully qualifying licensed products manufactured at the plant with a U.S. customer.
b. Consulting and advisory services as requested based on individual statements of work for agreed upon fees. - Other contractual provisions:
a. Right of First Negotiation for Next Generation Products: Chenyu agrees to offer G1 advanced, next-generation AAM technology prior to offering it to other AAM manufacturers in North America; and
b. Right of First Negotiation for Additional Markets: Chenyu agrees to offer G1 the right to license Chenyu’s AAM technology in Europe, the United Kingdom and the Kingdom of Saudi Arabia before offering it to other AAM manufacturers.
Chenyu reserves the right to terminate both the Technology License Agreement and the Consulting Agreement for convenience if G1 has not hired an engineering, procurement and construction management firm to assist with the design of the Ohio AAM plant by July 31, 2025. Termination of either of the Agreements by Chenyu if G1 does not meet these conditions automatically terminates the other agreement.
In anticipation of its manufacturing developments in Ohio, G1 has completed an internal corporate reorganization, adding indirect, wholly owned U.S. subsidiaries, including Graphite One Products Inc.
Copies of the Agreements will be filed under G1’s SEDAR+ profile at https://www.sedarplus.ca.
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Graphite One Enters Into Agreements Providing Exclusive Access to Industry Leading Anode Manufacturing Technology, source
