CONSULTING
SERVICES AGREEMENT

FOR

MANAGEMENT AND SALES REPRESENTATION

 

BY AND BETWEEN

 

TIANJIN CHINA
MARCH GROUP LTD.

AND

TIANJIN ZERUST
ANTI-CORROSION TECHNOLOGIES LTD.

 

DATED AS OF 1
SEPTEMBER, 1999










TABLE
OF CONTENTS

	
  ARTICLE 1.
	
  DEFINITIONS
	
  1

	
   
	
  1.1
	
  Shareholders Joint Venture Agreement
  or Agreement
	
  1

	
   
	
  1.2
	
  Ancillary Agreements
	
  1

	
   
	
  1.3
	
  Parties
	
  1

	
   
	
  1.4
	
  CMG
	
  1

	
   
	
  1.5
	
  NTI
	
  2

	
   
	
  1.6
	
  Taiyo
	
  2

	
   
	
  1.7
	
  NTI ASEAN
	
  2

	
   
	
  1.8
	
  NTI and/or NTI ASEAN Affiliates
	
  2

	
   
	
  1.9
	
  Corporation or Joint Venture
	
  2

	
   
	
  1.10
	
  Corporation’s Business
	
  3

	
   
	
  1.11
	
  Territory
	
  3

	
   
	
  1.12
	
  Effective Date
	
  3

	
   
	
  1.13
	
  NTI Intellectual Property Rights
	
  3

	
   
	
  1.14
	
  Knowhow
	
  3

	
   
	
  1.15
	
  Materials
	
  3

	
   
	
  1.16
	
  Process
	
  3

	
   
	
  1.17
	
  Product
	
  4

	
   
	
  1.18
	
  Masterbatch
	
  4

	
   
	
  1.19
	
  Trademark
	
  4

	
   
	
  1.20
	
  NTI and/or NTI ASEAN Trade Secrets
	
  4

	
   
	
  1.21
	
  Other Agreed Upon Technologies
	
  4

	
   
	
  1.22
	
  Net Sales
	
  5

	
   
	
  1.23
	
  At Cost
	
  5

	
   
	
  1.24
	
  Shareholder
	
  5

	
   
	
  1.25
	
  Equity Interest
	
  5

	
   
	
  1.26
	
  Transfer of Equity Interest
	
  5

	
   
	
  1.27
	
  Transferor of Equity Interest
	
  5

	
   
	
  1.28
	
  Transfer Price for Equity Interest
	
  5

	
   
	
  1.29
	
  Transferee
	
  6

	
   
	
  1.30
	
  Change of Control
	
  6

	
   
	
   
	
   
	
   

	
  ARTICLE 2.
	
  APPOINTMENT OF CMG AS MANAGER
	
  6

	
   
	
  2.1
	
  Appointment of CMG as Manager
	
  6

	
   
	
  2.2
	
  Duties and Authority of Manager
	
  6

	
   
	
  2.3
	
  Responsibility of Manager for
  Specific Activities
	
  6

	
   
	
   
	
   
	
   

	
  ARTICLE 3.
	
  APPOINTMENT OF CMG AS EXCLUSIVE
  SALES

  REPRESENTATIVE
	
  8

	
   
	
  3.1
	
  Appointment of CMG as Exclusive
  Sales Representative
	
  8

	
   
	
  3.2
	
  Commitment of CMG to Use its Best
  Efforts in the Performance of its

  Duties Hereunder
	
  8

	
   
	
  3.3
	
  Promotion of Product and Trademark
	
  8

	
   
	
  3.4
	
  Preparation and Use of Promotional
  Material
	
  9

	
   
	
  3.5
	
  Warranties
	
  9

	
   
	
  3.6
	
  Appointment of Distributors
	
  9




i











	
  ARTICLE 4.

  	
  PAYMENTS TO CMG FOR ITS SERVICES AS
  MANAGER AND AS

  EXCLUSIVE SALES REPRESENT A TIVE OF THE CORPORATION
	
  9

	
   
	
  4.1
	
  Basis for Payments
	
  9

	
   
	
  4.2
	
  Compensation to CMG for Consulting
  Services Rendered to TIANJIN

  ZERUST with Respect to Product
	
  9

	
   
	
  4.3
	
  Compensation to CMG for Services
  Rendered to TIANJIN ZERUST as

  Exclusive Representative With Respect to Product
	
  10

	
   
	
  4.4
	
  Compensation to CMG for Services
  Hereunder with Respect to Other

  Agreed Upon Technologies
	
  10

	
   
	
  4.5
	
  When a Sale is Deemed to Occur
	
  10

	
   
	
  4.6
	
  Support Year
	
  11

	
   
	
  4.7
	
  Statements and Payment to CMG
	
  11

	
   
	
  4.8
	
  Books and Records
	
  11

	
   
	
   
	
   
	
   

	
  ARTICLE 5.
	
  PROTECTION OF CMG TRADE SECRETS
	
  12

	
   
	
  5.1
	
  Identification of CMG Trade Secrets
	
  12

	
   
	
  5.2
	
  Protection of CMG Trade Secrets
	
  12

	
   
	
  5.3
	
  Protection of CMG Trade Secrets by
  Agents of TIANJIN ZERUST
	
  13

	
   
	
  5.4
	
  Remedies in the Event of a Violation
  of Article 5 Hereof
	
  13

	
   
	
   
	
   
	
   

	
  ARTICLE 6.
	
  COVENANT TO OBSERVE THE DOCTRINE OF
  “CORPORATE 

  OPPORTUNITY”
	
  14

	
   
	
  6.1
	
  Doctrine of Corporate Opportunity
  and Observance Thereof
	
  14

	
   
	
  6.2
	
  Agreement Not to Divert Resources
	
  14

	
   
	
  6.3
	
  Remedies for Breach of Agreement Not
  to Divert Resources
	
  14

	
   
	
   
	
   
	
   

	
  ARTICLE 7.
	
  TERM OF AGREEMENT
	
  15

	
   
	
  7.1
	
  Indefinite Term
	
  15

	
   
	
  7.2
	
  Termination
	
  15

	
   
	
  7.3
	
  Termination Upon Change of Control
  of a Party
	
  15

	
   
	
  7.4
	
  Termination Upon Bankruptcy or
  Insolvency
	
  15

	
   
	
  7.5
	
  Payment of Amounts Due
	
  16

	
   
	
  7.6
	
  Cooperation Upon Termination
	
  16

	
   
	
  7.7
	
  Non-Release of Obligations
	
  16

	
   
	
  7.8
	
  Cessation of Rights Upon
  termination
	
  16

	
   
	
   
	
   
	
   

	
  ARTICLE 8.
	
  DEFAULT
	
  17

	
   
	
  8.1
	
  Event of Default
	
  17

	
   
	
  8.2
	
  Remedies Upon Default or Breach
	
  17

	
   
	
  8.3
	
  Non-Waiver of Rights
	
  17

	
   
	
   
	
   
	
   

	
  ARTICLE 9.
	
  DISPUTE RESOLUTION
	
  18

	
   
	
  9.1
	
  Dispute Resolution by Arbitration
	
  18

	
   
	
  9.2
	
  Disputes Not Subject to Arbitration
	
  18

	
   
	
  9.3
	
  Conduct of Arbitration Proceedings
	
  19

	
   
	
  9.4
	
  Designation of the “Prevailing
  Party”
	
  19

	
   
	
  9.5
	
  Punitive Damages Excluded
	
  19




ii











	
  ARTICLE 10.

  	
  GENERAL PROVISIONS
	
  19

	
   
	
  10.1
	
  Benefit of Parties
	
  19

	
   
	
  10.2
	
  Counterparts
	
  19

	
   
	
  10.3
	
  Cooperation
	
  20

	
   
	
  10.4
	
  Index, Captions, Definitions and
  Defined Terms
	
  20

	
   
	
  10.5
	
  Waiver of Compliance
	
  20

	
   
	
  10.6
	
  Force Majeure
	
  20

	
   
	
  10.7
	
  Notices
	
  20

	
   
	
  10.8
	
  Entire Agreement
	
  21

	
   
	
  10.9
	
  Validity of Provisions
	
  22

	
   
	
  10.10
	
  Governmental Filings
	
  22

	
   
	
  10.11
	
  Payments
	
  22

	
   
	
  10.12
	
  Derivative Enforcement by NTI ASEAN
	
  22

	
   
	
  10.13
	
  Changes Subject to Approval of NTI
  ASEAN
	
  23




iii










CONSULTING
SERVICES AGREEMENT FOR

MANAGEMENT AND SALES REPRESENTATION


          This
Consulting Services Agreement for Management and Sales Representation
(“Consulting Services Agreement”) is made and entered into as of this 1 day of
September, 1999, by and between Tianjin China March Group Ltd. (“CMG”) and
Tianjin Zerust Anti-Corrosion Technologies Ltd. (“TIANJIN ZERUST” or the
“Corporation”).  The address of both CMG
and TIANJIN ZERUST is No. 127, Huoju Building, Huayuan Industrial Zone,
Tianjin, People’s Republic of China.


ARTICLE
1.

DEFINITIONS

          For
the purposes of this Consulting Services Agreement, the following Definitions
of terms shall apply:

	
  1.1
	
  Shareholders Joint Venture Agreement or Agreement.




          That
certain Shareholders Joint Venture Agreement by and between NTI ASEAN (as
hereinafter defined), and CMG (as hereinafter defined), for the formation and
governance of a new entity tinder the laws of the People’s Republic of China in
the form of a limited liability company which shall be known as Tianjin Zerust
Anti-Corrosion Technologies Ltd. (“TIANJIN ZERUST” or the “Corporation”),

	
  1.2
	
  Ancillary Agreements.

	
   
	
   
	
   

	
   
	
  The following are the Ancillary Agreements and the
  Parties thereto:

	
   
	
   
	
   

	
   
	
  1.2.1
	
  Consulting Services Agreement for Management and
  Sales Representation between CMG and TIANJIN ZERUST (“Consulting Services
  Agreement”);

	
   
	
   
	
   

	
   
	
  1.2.2
	
  License Agreement between NTI ASEAN and TIANJIN
  ZERUST (“License Agreement”); and

	
   
	
   
	
   

	
   
	
  1.2.3
	
  Technical Assistance and Marketing Support Agreement
  between NTI ASEAN and TIANJIN ZERUST (“Technical Assistance Agreement”).

	
   
	
   
	
   

	
  1.3
	
  Parties.




          The
Parties to the Shareholders Joint Venture Agreement and/or the Ancillary
Agreements, their successors and permitted assigns.

	
  1.4

  	
  CMG.




          CMG,
a limited liability company organized under the laws of the People’s Republic
of China, and the owner of a 50% interest in the Corporation pursuant to the
terms of the Agreement.  The ownership
of CMG is as follows: Container (Beijing) Industrial Company, 20%; Tianjin CNCC
Zhi Hua Trading Ltd., 5%; Ping Shan CNCC Si Qiang Group Company, 66% and CNCC
9%.

1











	
  1.5
	
  NTI.




          Northern
Technologies International Corporation, a company organized under the laws of
the State of Delaware, U.S.A.  The
principal place of business of which is Lino Lakes, Minnesota, U.S.A.  NTI is the owner of the NTI Intellectual
Property Rights (as hereinafter defined), and of a 50% interest in NTI ASEAN
(as hereinafter defined).

	
  1.6
	
  Taiyo.




          Taiyo
Petroleum Gas Co Ltd.  A Kabushiki
Kaisha organized under the laws of Japan and the owner of a 50% interest in
Party B (as hereinafter defined).

	
  1.7
	
  NTI ASEAN.




          NTI
ASEAN, LLC., a Limited Liability Company, organized under the laws of the State
of Nevada, U.S.A. whose registered office is in Reno, Nevada, U.S.A., to which
NTI has assigned all of its right, title and interest in the NTI Intellectual
Property Rights (as hereinafter defined) for the Territory (as hereinafter
defined), and the owner of a 50% interest in the Corporation pursuant to the
Agreement.

	
  1.8

  	
  NTI and/or NTI ASEAN Affiliates.




          All
entities and/or individuals with which NTI and/or NTI ASEAN has a joint venture
relationship, similar in character and style but not necessarily identical to
the relationship created by the Shareholders Joint Venture Agreement and the
Ancillary Agreements, or another form of alliance, for the development,
manufacture, promotion, marketing, sales and applications engineering of
Knowhow, Materials, Process, Product and/or Masterbatch anywhere in the world.

	
   
	
  1.8.1
	
  NTI Affiliates.




          The
NTI Affiliates as of the date hereof are set forth in Annex I to the
Shareholders Joint Venture Agreement.

	
   
	
  1.8.2
	
  NTI ASEAN Affiliates.




          The
NTI ASEAN affiliates as of the date hereof are set forth in Annex II to the
Shareholders Joint Venture Agreement.

	
  1.9
	
  Corporation or Joint Venture.




          TIANJIN
ZERUST, that entity created in the Territory by the Parties pursuant to the
Shareholders Joint Venture Agreement to conduct the Corporation’s Business.

2












	
  1.10
	
  Corporation’s Business.




          The
Corporation’s Business shall be the manufacturing, marketing and distribution
of Product, pursuant to NTI Intellectual Property Rights, and of any other
technologies as shall be determined by the Parties in writing and made a part
hereof pursuant to Article 1.21 of this Agreement, in the Territory.

	
  1.11
	
  Territory.




          The
People’s Republic of China.

	
  1.12
	
  Effective Date.




          The
date upon which all necessary formal approvals from the appropriate authorities
of Country for the Shareholders Joint Venture Agreement have been obtained and
the Corporation has been duly registered pursuant to the Shareholders Joint
Venture Agreement and the Ancillary Agreements as appropriate in the Territory.

	
  1.13
	
  NTI Intellectual Property Rights.




          The
Knowhow, Materials, Process, Product, Masterbatch, Trademark, and NTI and/or
NTI ASEAN Trade Secrets, (all as hereinafter defined), collectively, as such
currently exist and shall hereafter be modified, developed and/or acquired by
NTI.

	
  1.14

  	
  Knowhow.




          The
technology, formulae, methods and procedures developed by NTI at considerable
expense over a period of many years, which are unique in nature and essential
or useful in the proper application of the Process, together with all
improvements and modifications with respect thereto.

	
  1.15
	
  Materials.




          The
constituent materials and chemicals of one or more formulations developed by
NTI under strict quality controls which are required for utilization of the
Process.

	
  1.16
	
  Process.




          The
procedure utilizing the Knowhow for the manufacture of polyethylene substances
with corrosion inhibiting properties derived from the Materials as developed
and specified by NTI, together with any improvements and modifications of the
corrosion inhibiting technology as it relates directly to the manufacture of
corrosion inhibiting polyethylene substances, together with future technology,
knowledge and product development which is useful in the manufacture of the
Product.

3











	
  1.17
	
  Product.




          Corrosion
inhibiting polyethylene film and solid substances of polyethylene in the form
of boxes, tubes and other containers, which may include other volatile
corrosion inhibiting host packaging substances such as paper, manufactured by
means of the Process, incorporating the Materials and utilizing the Trademark,
all of which have been developed and are owned by NTI.

	
  1.18

  	
  Masterbatch.




          Any
formulation of the Materials which shall be designated by NTI, as appropriate,
to be applied to the specific requirements for corrosion protection, as
afforded by the Product, of a known customer desirous of protecting an
identified object (or objects) which are to be subjected to an anticipated
certain range of corrosive influences. 
In addition to Materials, Masterbatch shall generally also contain other
substances for the purpose of facilitating the manufacture of Product utilizing
the Process.

	
  1.19
	
  Trademark.




          The
name and style “ZERUST”, which includes trade literature, technical
specifications and application instructions, and promotional material
pertaining thereto, together with any ancillary trademark registrations, which
may differ between various jurisdictions.

	
  1.20
	
  NTI and/or NTI ASEAN Trade Secrets.




          All
information deemed and designated confidential, both in the Shareholders Joint
Venture Agreement and in the Ancillary Agreements and hereafter, including but
not limited to information regarding the Product, Knowhow, Process, Materials,
Masterbatch, technology, customers, research, techniques, processes,
applications, formulae, cost data, customer lists, suppliers, competition,
marketing strategy, supply relationships, costs and cost accounting, memoranda,
diagrams, pictures, computer software and programs and records contained therein,
sales information, financial information, costs, pricing data and profits,
relating to the business and Intellectual Property Rights of NTI, NTI ASEAN,
the Corporation and NTI and/or NTI ASEAN Affiliates, both in the Territory and
elsewhere.

	
  1.21

  	
  Other Agreed Upon Technologies.




          In conformity with the
objectives of the Parties hereto to expand the Corporation’s Business over
time, the Parties shall endeavor to identify products, materials and/or
technologies, which are both compatible with the Corporation’s Business, and
susceptible of being profitably marketed through and/or by the Corporation in
the Territory.  Upon joint agreement of
the Parties, in writing, to adopt such new products, materials and/or technologies
within the scope of the Corporation’s Business, and successful negotiation of
requisite commercial rights to commercialize such new products, materials
and/or technologies in the Territory, such new products, materials and/or
technologies shall be deemed to be incorporated within the Corporation’s
Business as “Other Agreed Upon Technologies” to be treated as set forth in this
Consulting Services Agreement.

4











	
  1.22
	
  Net Sales.




          The
total proceeds from the sale of Product and Other Agreed Upon Technologies sold
by the Corporation in normal, bona fide commercial transactions on an arm’s
length basis to, by, with, or through an entity which is not affiliated with
any Party of this Agreement, less the following items: (i) sales discounts
(including sales rebates); (ii) sales returns; (iii) shipping and transaction
costs, such as Value Added Tax, CIF charges and packaging expenses; and (iv)
sales commissions to third parties. 
Sales made to an entity which is not affiliated with any Party of this
Agreement through an Affiliated Entity, in accordance with article 4.3 of the
Management and Sales Representation Agreement shall be included in total
proceeds for the purpose of this definition of Net Sales.

	
  1.23

  	
  At Cost.




          Without
profit component of any kind, direct or indirect, to the particular Party in
the given case (although nothing herein shall preclude such Party from
recovering all costs - direct and indirect - arising out of any transaction
with the proscription “At Cost”).

	
  1.24
	
  Shareholder.




          Any
holder, from time to time, of an Equity Interest in the Corporation and who
presently is a Party to the Shareholders Joint Venture Agreement or who may
become a Party to the Shareholders Joint Venture Agreement in the future.

	
  1.25
	
  Equity Interest.




          Any
validly issued Equity Interest in the Corporation owned by any Shareholder
pursuant to the Shareholders Joint Venture Agreement.

	
  1.26
	
  Transfer of Equity Interest.




          Any
sale, transfer, assignment, pledge or disposition of Equity Interests in the
Corporation in any way, whether voluntarily or involuntarily, by gift, legal
procedure, operation of law, or any other means.

	
  1.27

  	
  Transferor of Equity Interest.




          A
Shareholder who declares an intention to Transfer an Equity Interest in the
Corporation and/or initiates the Transfer of an Equity Interest.

	
  1.28
	
  Transfer Price for Equity Interest.




The price per share for
the Shares of the Corporation offered on an arm’s-length basis by an outside
party to the Transferor in a bona fide written offer.

5











	
  1.29
	
  Transferee.




          Any
new Shareholder, who has heretofore not been a party to the Shareholders Joint
Venture Agreement, who acquires his Equity Interest pursuant to the provisions
of the Shareholders Joint Venture Agreement, and who thereafter signs and becomes
a Party to the Shareholders Joint Venture Agreement.

	
  1.30
	
  Change of Control.




          Any
change in ownership, management, control or scope of business activities of a
Party which could affect the performance of the duties and/or obligations of
such Party under the Shareholders Joint Venture Agreement or the Ancillary
Agreements.

ARTICLE 2.

APPOINTMENT OF CMG AS MANAGER


	
  2.1
	
  Appointment of CMG as Manager.




          TIANJIN
ZERUST hereby appoints CMG to implement the Purposes of the Joint Venture (as defined
in Article 3 of the Shareholders Joint Venture Agreement) and to manage,
supervise and conduct the Corporation’s Business.  CMG hereby accepts such appointment and agrees to serve in such
capacity in accordance with the terms hereof and with the terms of the
Shareholders Joint Venture Agreement and the Ancillary Agreements.

	
  2.2
	
  Duties and Authority of Manager.




          CMG
shall have all authority which may be necessary, desirable or appropriate in
connection with the discharge of CMG’s duties hereunder, subject only to
applicable limitations contained in the Shareholders Joint Venture Agreement
and the Ancillary Agreements, and the provisions of Article 2 hereof.  CMG shall use its best efforts in the performance
of its duties and shall discharge same and conduct the Corporation’s Business
in a good, workmanlike and commercially reasonable manner and in accordance
with sound business practices and the standard of diligence and care normally
exercised by duly qualified persons in the performance of comparable work.

	
  2.3
	
  Responsibility of Manager for Specific
  Activities.




          In
the course of fulfilling its responsibilities pursuant to this Consulting
Services Agreement, CMG shall carry out the following activities on behalf of
TIANJIN ZERUST.

	
   
	
  2.3.1
	
  Cause TIANJIN ZERUST to comply with the terms of the
  Shareholders Joint Venture Agreement and the Ancillary Agreements;

	
   
	
   
	
   

	
   
	
  2.3.2
	
  Acquire such materials, supplies, equipment,
  services and technical assistance as may be necessary, desirable or appropriate
  for the conduct of the Corporation’s Business;




6











	
   
	
  2.3.3
	
  Procure from outside experts, consultants and
  professionals such engineering, legal, advertising, promotional, and, except
  for accounting services (which shall be provided in accordance with the
  Shareholders Joint Venture Agreement), other advisory and professional
  services as may be necessary, desirable or appropriate for the conduct of the
  Corporation’s Business;

	
   
	
   
	
   

	
   
	
  2.3.4
	
  Protect, keep and maintain the properties and assets
  of TIANJIN ZERUST and such properties and assets of the Parties to the
  Shareholders Joint Venture Agreement as are in the Corporation’s actual
  possession;

	
   
	
   
	
   

	
   
	
  2.3.5
	
  Hire, train and supervise such personnel as may be
  necessary, desirable or appropriate for the conduct of the Corporation’s
  Business;

	
   
	
   
	
   

	
   
	
  2.3.6
	
  Provide all executive and administrative
  responsibilities and services necessary, desirable or appropriate for the
  conduct of the Corporation’s Business;

	
   
	
   
	
   

	
   
	
  2.3.7
	
  Cause TIANJIN ZERUST to comply with all laws applicable
  to it;

	
   
	
   
	
   

	
   
	
  2.3.8
	
  Process all customer orders, provide billings to
  customers and make adjustments with customers as appropriate;

	
   
	
   
	
   

	
   
	
  2.3.9
	
  Manage the credit risk of the Corporation including
  making inquiries regarding the creditworthiness of potential customers;

	
   
	
   
	
   

	
   
	
  2.3.10
	
  Manufacture or cause the manufacture of Product and
  Other Agreed Upon Technologies in the Territory, and, as far as CMG and its
  affiliates are concerned, At Cost;

	
   
	
   
	
   

	
   
	
  2.3.11
	
  Maintain the books and records of the Corporation in
  accordance with the normal practices of similar businesses in the Territory;

	
   
	
   
	
   

	
   
	
  2.3.12
	
  Prepare and file with governmental authorities all
  required reports and returns relating to the Corporation’s Business;

	
   
	
   
	
   

	
   
	
  2.3.13
	
  Procure on behalf of the Corporation such product
  liability, public liability and other liability, casualty, and general
  insurance, as may be necessary, desirable and appropriate for the conduct of
  the Corporation’s Business the Territory;

	
   
	
   
	
   

	
   
	
  2.3.14
	
  Establish and maintain a segregated bank account or
  accounts in the name of the Corporation for the deposit and disposition of
  all funds generated by and disbursed for the Corporation’s Business;

	
   
	
   
	
   

	
   
	
  2.3.15
	
  Apply standards for the extension of credit and
  establish and maintain systems for the collection of all accounts, including
  overdue accounts in accordance with the normal practices of similar
  businesses in the Territory;

	
   
	
   
	
   

	
   
	
  2.3.16
	
  Coordinate the pricing and discount structure for
  the sale of Product and Other Agreed Upon Technologies to customers and/or
  distributors in the Territory, which will result in a reasonable profit to
  the Corporation, subject to the provisions of Article 7.3.17. of the
  Shareholders Joint Venture Agreement;




7











	
   
	
  2.3.17
	
  Arrange for the preparation and delivery of the
  Corporation’s financial statements as required by the Shareholders Joint
  Venture Agreement;

	
   
	
   
	
   

	
   
	
  2.3.18
	
  Cause Agents of the Corporation to execute
  appropriate Trade Secrecy Agreements for the benefit of NTI and/or NTI ASEAN,
  substantially in the form of Appendix I hereto; and to execute Trade Secrecy
  Agreements for the benefit of CMG, substantially in the form of Appendix II
  hereto; and

	
   
	
   
	
   

	
   
	
  2.3.19
	
  Perform or cause the Corporation to Perform all
  other acts and functions as may be necessary, desirable or appropriate in
  connection with the conduct of the Corporation’s Business within its
  corporate authority as stated in TIANJIN ZERUST’s Articles of Incorporation,
  subject to the Shareholders Joint Venture Agreement, the Ancillary Agreements
  and duly adopted Resolutions of the Board of Directors.




ARTICLE
3.

APPOINTMENT OF CMG AS

EXCLUSIVE SALES REPRESENTATIVE

	
  3.1
	
  Appointment of CMG as Exclusive Sales
  Representative.




          TIANJIN
ZERUST hereby appoints CMG as its Exclusive Sales Representative for the
marketing and sale of Product and Other Agreed Upon Technologies in the
Territory, and CMG hereby accepts such appointment and agrees to use its best
efforts in accordance with the terms hereof to promote the marketing and sale
of Product and Other Agreed Upon Technologies in the Territory.

	
  3.2

  	
  Commitment of CMG to Use its Best
  Efforts in the Performance of its Duties Hereunder.




          CMG
shall use its best efforts in the performance of its duties hereunder and shall
discharge same in a good, workmanlike and commercially reasonable manner and in
accordance with sound business practices and the standard of diligence and care
normally exercised by duly qualified persons in the performance of comparable
work.

	
  3.3
	
  Promotion of Product and Trademark.




          In
connection with the discharge of its duties hereunder CMG shall use its best
efforts to solicit and to obtain business and, in so doing, to develop an
increasing awareness of the Product, Trademark and Other Agreed Upon
Technologies among potential customers. 
Such sales efforts will be carried on by properly trained sales
personnel who shall thoroughly, energetically and regularly canvass and call
upon customers and potential customers. 
CMG shall advise TIANJIN ZERUST and NTI ASEAN on a periodic basis (not
less frequently than quarterly) as to the status of its sales efforts, the
nature of orders obtained and the amount of backlog.

8











	
  3.4
	
  Preparation and Use of Promotional
  Material.




          CMG
shall prepare promotional material for the conduct of the Corporation’s
Business in the Territory in the Chinese language, which shall be suitable
under good business practice in Territory. 
CMG shall not, however, distribute any promotional material, literature,
specifications, manuals, product claims or descriptions concerning the
Materials, Masterbatch, Process, Knowhow, Product or NTI Intellectual Property
Rights without the prior written approval thereof by NTI ASEAN.

	
  3.5

  	
  Warranties.




          CMG
shall make no warranty on behalf of NTI or NTI ASEAN or the Corporation, and
shall instruct its Agents (as defined in Article 13.3.1 of the Shareholders
Joint Venture Agreement) and the Agents (as hereinafter defined) and Sub
manufacturers (as defined in Article 7.3.1.(i) of the License Agreement and
Article 7.3.1(i) of the Technical Assistance Agreement) of TIANJIN ZERUST to
make no warranty on behalf of NTI, NTI ASEAN or the Corporation as to the
Knowhow, Process, Product or NTI Intellectual Property Rights, except in
accordance with documentation specifically approved by NTI or NTI ASEAN.  A copy of the current warranty documentation
utilized by NTI and NTI ASEAN is attached hereto as Appendix III.

	
  3.6
	
  Appointment of Distributors.




          CMG
may appoint distributors for Product and Other Agreed Upon Technologies in the
Territory on an arms-length basis.  CMG
may also serve as a distributor of Product and Other Agreed Upon Technologies,
either directly or indirectly in the Territory, provided that the total
compensation to CMG for all services it renders to the Corporation as Sales
Manager does not aggregate more than 10% of Net Sales.  It is agreed between the parties that
Sembcorp Technologies Pte. Ltd. shall be appointed as a distributor of TIANJIN
ZERUST in the Territory on the same terms extended to any other similar
distributor in the Territory.

ARTICLE
4.

PAYMENTS TO CMG FOR ITS SERVICES AS MANAGER

AND AS EXCLUSIVE SALES REPRESENTATIVE OF THE

CORPORATION

	
  4.1
	
  Basis for Payments.




          TIANJIN
ZERUST shall make payments to CMG which are provided for in Article 4 of this
Consulting Services Agreement in consideration of the services performed by CMG
as set forth in Articles 2 and 3 hereof. 
Such payments shall be made throughout the full term of this Management
and Sales Representation Agreement as compensation for the services set forth
above and duly provided by CMG.

	
  4.2

  	
  Compensation to CMG for Consulting
  Services Rendered to TIANJIN ZERUST with Respect to Product.




          As
compensation for the Consulting services to be rendered by CMG pursuant to this
Consulting Services Agreement with respect to Product, TIANJIN ZERUST shall pay
to CMG a fee equal to five percent (5%) of the amount of Net Sales of Product,
plus reimbursement of reasonable, direct out-of-pocket expenses (At Cost) paid
or incurred by CMG in the discharge of its responsibilities hereunder.  Such amounts shall be paid to CMG within
thirty (30) days after the conclusion of each quarterly period, based upon Net
Sales and out-of-pocket expenses during the preceding quarterly period.  There shall, however, be no separate or
additional compensation in conjunction with services, such as accounting,
invoicing or other management or administrative functions, which services are
to be performed by CMG within the scope of its responsibilities as Manager.

9











	
  4.3
	
  Compensation to CMG for Services
  Rendered to TIANJIN ZERUST as Exclusive Representative With Respect to
  Product.




          CMG
shall receive compensation for its services to TIANJIN ZERUST as Exclusive
Sales Representative for Product hereunder equal to ten percent (10%) of the
total Net Sales of Product by the Corporation, plus reasonable, direct
out-of-pocket expenses (At Cost) incurred in the performance of its duties in
this regard.  There shall, however, be
no separate or additional compensation in conjunction with services, such as
carrying out promotional activities or conducting sales seminars, which
services are to be performed by CMG within the scope of its responsibilities as
Exclusive Sales Representative of TIANJIN ZERUST.  In the course of effectuating sales, CMG may either purchase
Product directly from the Corporation and thereupon resell same to customers
for its own account, or alternatively serve as a commission agent for the
Corporation, but not both; provided that the total margin to CMG does
not exceed 10%.  Payment terms for
Product purchased by CMG from the Corporation for resale to customers shall be
equal to the same terms offered by CMG on behalf of the Corporation to third
parties fulfilling the same functions; and payment for Product purchased shall
be made by CMG to the Corporation forthwith upon receipt of payment from
customers.

	
  4.4

  	
  Compensation to CMG for Services
  Hereunder with Respect to Other Agreed Upon Technologies.




          Compensation
to CMG for services rendered within the scope of this Consulting Services
Agreement with respect to Other Agreed Upon Technologies shall be as agreed
between the Parties on a case-by-case basis. 
Unless otherwise agreed between the Parties, however, CMG shall perform
substantially the same functions, and have substantially the same rights,
duties and obligations with respect to Other Agreed Upon Technologies as it
does with respect to Product. 
Accordingly, CMG’s total Compensation with respect to the services
rendered with respect to Other Agreed Upon Technologies shall, unless otherwise
agreed between the Parties, be equal to the total Compensation paid to CMG for
the services it renders to the Corporation with respect to Product.

	
  4.5
	
  When a Sale is Deemed to Occur.




          A
sale shall be deemed to have occurred when Product or goods based upon Other
Agreed Upon Technologies have been billed or (if not billed) delivered to and
fully paid for by a customer.

10











	
  4.6
	
  Support Year.




          The
term Support Year (“Support Year”) shall mean any twelve (12) month period
ending on December 31, except that the first Support Year shall commence on the
Effective Date and end on the next December 31 date.

	
  4.7

  	
  Statements and Payment to CMG.




           Within
sixty (60) days after the last day of each quarterly period in each Support
Year, CMG shall cause the Corporation:

	
   
	
  4.7.1
	
  To prepare and deliver to CMG a complete and
  accurate statement setting forth for the quarter just ended and separately
  and cumulatively for, and with respect to all elapsed quarterly periods for
  the Support Year:

	
   
	
   
	
   

	
   
	
   
	
  (i)
	
  The total amount of Net Sales of Product (broken
  down in reasonable detail by individual volumes and customers and showing all
  costs and discounts leading to the establishment of the Net Sales figure for
  each customer); and

	
   
	
   
	
   
	
   

	
   
	
   
	
  (ii)
	
  The total amount of compensation on such Net Sales
  of Product (computed as hereinbefore provided) payable to CMG for its
  Management and Sales Representation Services to the Corporation hereunder;
  and

	
   
	
   
	
   
	
   

	
   
	
   
	
  (iii)
	
  The total amount of Net Sales of Other Agreed Upon
  Technologies (broken down in reasonable detail by volumes and individual
  customers and showing all costs and discounts leading to the establishment of
  the Net Sales figure for each customer); and

	
   
	
   
	
   
	
   

	
   
	
   
	
  (iv)
	
  The total amount of compensation on such Net Sales
  of Other Agreed Upon Technologies (computed as hereinbefore provided) payable
  to CMG for its Management and Sales Representation Services to the
  Corporation hereunder.

	
   
	
   
	
   
	
   

	
   
	
  4.7.2
	
  Pay to CMG the full amount of compensation to which
  it is entitled for and with respect to the period or periods of the Support
  Year covered by the statement(s) provided for in Article 4.7.1. hereof.

	
   
	
   
	
   

	
  4.8
	
  Books and Records.




          CMG
covenants and agrees that, as part of its duties under Article 2 hereof, it
will cause TIANJIN ZERUST:

	
   
	
  4.8.1
	
  To keep complete and accurate records and books of
  account showing the amount of billings to customers and the amount of
  deductions therefrom in arriving at Net Sales of Product and of Other Agreed
  Upon Technologies and all additional data and information which may be
  reasonably necessary to enable CMG or its independent accountants to verify
  the completeness and accuracy for each item of information which TIANJIN
  ZERUST is required to set forth in each of the statements referred to in
  Article 4.7.1.;




11











	
   
	
  4.8.2
	
  To keep all such records and books of account at its
  principal office and to preserve all such records and books of account for a
  period of not less than three (3) years from and after the date on which such
  records, or the last entry in such books of account was made, whichever shall
  be later; and

	
   
	
   
	
   

	
   
	
  4.8.3
	
  To make such records, books of account, data and
  information available to CMG and/or its representatives and independent
  accountants and give to such representatives or accountants free and complete
  access, at any reasonable time or times, to all such records, books of
  account, data and information, for the purposes of examining the same and verifying
  the completeness and accuracy of each item of information which TIANJIN
  ZERUST is required to set forth in each of the statements referred to in
  Article 4.7.1. hereof.  In addition,
  CMG shall have the right to make copies of any of the foregoing.  The independent accountants of TIANJIN
  ZERUST shall in the ordinary course of business provide written confirmation
  and certification to CMG, at least annually, of the data to be supplied to
  CMG pursuant to Article 4.7.1. hereof. 
  The cost of such reports shall be borne by TIANJIN ZERUST.  In the event that CMG shall cause their
  representatives to confirm or verify the accuracy of the data supplied by the
  Corporation, then the costs and fees of such representatives shall be borne
  by CMG, unless such representatives shall determine, to the satisfaction of
  the Corporation’s independent accountants, that there is a variation in the
  reporting of Net Sales of five (5%) or more, in which event the costs and
  fees of CMG’s representatives and/or accountants shall be borne by the
  Corporation.




ARTICLE
5.

PROTECTION OF CMG TRADE SECRETS

	
  5.1

  	
  Identification of CMG Trade Secrets.




          The
Parties acknowledge that it is not intended that CMG impart its technology or
trade secrets to the Corporation or, through the Corporation, to NTI
ASEAN.  The Parties recognize, however,
that CMG may impart information to the Corporation to further the Corporation’s
business, which CMG considers to be proprietary in nature and thus wishes to be
kept confidential, and that such CMG Trade Secrets may come to be imparted to
NTI ASEAN through the Corporation.  In
order for such information to be considered under the category of CMG Trade
Secrets, CMG must alert the Corporation and NTI ASEAN to the fact that it
intends to impart information it considers proprietary to the Corporation, in
writing, in advance of imparting such information, and clearly identify such
information as a CMG Trade Secret (“CMG Trade Secrets”).

	
  5.2
	
  Protection of CMG Trade Secrets.




          TIANJIN
ZERUST agrees that during the term of this Consulting Services Agreement, as
well as following its termination and for all times thereafter, it shall keep
secret and confidential all CMG Trade Secrets which it now knows or may
hereafter come to know as a result of the Shareholders Joint Venture Agreement
and Ancillary Agreements.  CMG Trade
Secrets shall not be disclosed by TIANJIN ZERUST to third parties and shall be
kept secret and confidential, except (i) to the extent that the same have
entered into the public domain by means other than the improper actions of
TIANJIN ZERUST, or (ii) to the extent that the disclosure thereof may be
required pursuant to the order of any court or other governmental body.  If a CMG Trade Secret shall be in the public
domain as the result of an act by TIANJIN ZERUST or any Agent thereof, then
TIANJIN ZERUST shall nevertheless continue to keep such CMG Trade Secret secret
and inviolate.

12












	
  5.3
	
  Protection of CMG Trade Secrets by
  Agents of TIANJIN ZERUST.




          Neither
TIANJIN ZERUST, nor its Agents (as hereinafter defined), shall at any time
copy, remove from their proper location - be it within the Corporation or
elsewhere - or retain without CMG’s prior written consent, the originals or
copies of any CMG Trade Secrets.  It is
understood that from time to time it may be necessary that certain of the
foregoing items be copied or removed from their location; however, this shall
be done subject to the requirement of this Article that the original material
be returned to its proper location as soon as possible and that the
confidential nature and integrity of the foregoing as CMG Trade Secrets be
strictly maintained both as to original documents and copies thereof.

	
   
	
  5.3.1
	
  Insofar as the officers, employees and consultants
  of TIANJIN ZERUST (herein collectively “Agents”) who come in contact with CMG
  Trade Secrets are concerned, TIANJIN ZERUST shall cause such Agents to enter
  into CMG Trade Secrecy Agreements substantially in the form of Appendix II to
  this Agreement.  TIANJIN ZERUST shall
  exert its best efforts to cause its Agents to adhere to and to abide by the
  provisions, restrictions and limitations of the CMG Trade Secrecy Agreements
  which efforts shall include the institution and prosecution of appropriate
  litigation if such be necessary and desirable.

	
   
	
   
	
   

	
   
	
  5.3.2
	
  The Parties hereby agree and acknowledge that CMG is
  an intended third party beneficiary of the CMG Trade Secrecy Agreements, and
  that CMG may in its sole discretion, on its own behalf or derivatively and/or
  on behalf of the Corporation directly enforce the provisions of the CMG Trade
  Secrecy Agreements and/or any breach thereof against any and all Agents of
  TIANJIN ZERUST (as defined in Article 5.3.1 hereof) who have executed same.

	
   
	
   
	
   

	
  5.4
	
  Remedies in the Event of a Violation of
  Article 5 Hereof.




          It
is understood and recognized by TIANJIN ZERUST that in the event of any
violation by TIANJIN ZERUST or its Agents of the provisions of Article 5
hereof, CMG’s remedy at law will be inadequate and CMG will suffer irreparable
injury.  Accordingly, TIANJIN ZERUST
consents to injunctive and other appropriate equitable relief upon the
institution of legal proceedings therefor by CMG and in any court of competent
jurisdiction to protect CMG Trade Secrets. 
Such relief shall be in addition to any other relief to which CMG may be
entitled at law or in equity, which shall include but not be limited to the
right of immediate termination of this Consulting Services Agreement.

13











ARTICLE
6.

COVENANT TO OBSERVE

THE DOCTRINE OF “CORPORATE OPPORTUNITY”

	
  6.1
	
  Doctrine of Corporate Opportunity and
  Observance Thereof.

	
   
	
   




          It
is the intent of the Parties to this Consulting Services Agreement, the
Shareholders Joint Venture Agreement and to the other Ancillary Agreements to
deal solely with each other with respect to the commercial, technical and
strategic development of the Corporation’s Business in the Territory.  Consequently, the Parties to each agreement
cited above hereby renounce and covenant not to engage in any activity which
would either (a) negatively impact the performance of their duties under the
Shareholders Joint Venture Agreement or the Ancillary Agreements in the
Territory, or (b) have the effect of displacing or substituting Net Sales of
Product and/or of Other Agreed Upon Technologies, and/or the application of NTI
Intellectual Property Rights, in the Territory; except as specifically agreed
to by the Parties in furtherance of the Corporation’s Business (“Corporate
Opportunity”).

	
  6.2
	
  Agreement Not to Divert Resources.




          CMG
and TIANJIN ZERUST agree that during the term of this Consulting Services
Agreement they shall not, directly or indirectly, in any capacity whatsoever,
engage in, own, manage, operate, control, act as a consultant to, have a
financial interest in, or otherwise participate in the ownership, licensing,
management, operation or control of, a business which would impede, substitute,
displace or divert Net Sales of Product and/or of Other Agreed Upon
Technologies from the Corporation within the Territory except through the
Corporation in furtherance of the Corporation’s Business.  During said term CMG shall not in any way,
directly or indirectly, divert, take away or interfere with or attempt to
divert, take away or interfere with, any of the customers, accounts, suppliers,
employees, representatives or patronage of the Corporation.  In the event that this Consulting Services
Agreement is terminated: (i) because of a material Breach of the Shareholders
Joint Venture Agreement by a Party; or (ii) because of a material Breach of any
Ancillary Agreement by a Party; (iii) upon the bankruptcy or other adverse
condition of a Party as described in Article 7 hereof; (iv) pursuant to Article
8 hereof; or (v) upon a Breach of Article 5 or 6 hereof, then the Party in
Breach or subject to such adverse condition shall continue to be bound by the
provisions of Article 6 of this Consulting Services Agreement for a period of
three years following the date of termination, but shall at no time be
permitted to use CMG Trade Secrets, for any activity outside the Corporation.

	
  6.3

  	
  Remedies for Breach of Agreement Not to
  Divert Resources.




          It
is understood and recognized by the Parties that in the event of a violation of
the provisions of Article 6 hereof by a Party, the remedy at law will be
inadequate and that the other Party to this Consulting Services Agreement shall
suffer irreparable injury.  Accordingly,
each Party to this Consulting Services Agreement consents to injunctive or
other appropriate equitable relief upon the institution of legal proceedings
therefor by the non-violating Party. 
Such relief shall be in addition to any other relief to which a Party
may be entitled at law or in equity, which shall include, but not be limited
to, the right of immediate termination of this Consulting Services Agreement.

14










ARTICLE
7.

TERM OF AGREEMENT

	
  7.1
	
  Indefinite Term.




          This
Consulting Services Agreement shall become effective on the Effective Date and
shall, unless otherwise terminated in accordance with the provisions hereof,
continue in effect for an indefinite term of years.

	
  7.2
	
  Termination.




          This
Consulting Services Agreement, having become effective as of the Effective Date
hereof, shall continue in effect unless:

	
   
	
  7.2.1
	
  Terminated by either Party in accordance with the
  provisions of Articles 5 and/or 6 hereof;

	
   
	
   
	
   

	
   
	
  7.2.2
	
  Terminated by either Party by reason of a material
  Breach or Default of this Consulting Services Agreement by the other Party
  which has not been cured or remedied in accordance with Article 8 hereof;

	
   
	
   
	
   

	
   
	
  7.2.3
	
  Terminated automatically, in conjunction with the
  termination of the Shareholders Joint Venture Agreement or any of the other
  Ancillary Agreements by a Party thereto by reason of a material Breach (as
  therein defined) or Default (as therein defined) of any such Agreement by a
  Party thereto, which Breach or Default has not been cured or remedied in
  accordance with the curative provisions thereof.  In such event, this Consulting Services Agreement shall
  likewise terminate on the same date, without any further act or notice given
  by a Party hereto; or

	
   
	
   
	
   

	
   
	
  7.2.4
	
  Terminated in accordance with Article 7.3 and/or
  Article 7.4 hereof.

	
   
	
   
	
   

	
  7.3
	
  Termination Upon Change of Control of a
  Party.




          In
the event that a Change of Control of a Party hereto shall occur, then the
other Party may, upon six (6) months prior written notice given to such Party,
terminate this Consulting Services Agreement, unless the Change of Control of
such Party shall have been effected upon prior notification and with the
written understanding of the other Party.

	
  7.4

  	
  Termination Upon Bankruptcy or
  Insolvency.




          If a Party hereto shall
become bankrupt or insolvent or shall file for any debtor relief proceedings,
or if there shall be filed in Court against a Party legal proceedings for
bankruptcy, insolvency, reorganization or for the appointment of a receiver or
trustee of all or a portion of such Party’s property, or if a Party makes an
assignment for the benefit of creditors or petitions for or enters into an
arrangement for debtor relief and such proceedings as are described aforesaid
are not dismissed within a period of ninety (90) days after the institution
thereof, then, at the option of the other Party, this Consulting Services
Agreement shall forthwith terminate by written notice given to the Party who
has filed, instituted or against whom any of the proceedings aforesaid have
been brought; provided that if a stay has been granted by a Trustee or
Judge in Bankruptcy by virtue of which this Consulting Services Agreement is to
be deemed an executory contract, then the other Party shall continue to perform
under the terms of this Consulting Services Agreement if:

15











	
   
	
  7.4.1
	
  Payments due under this Consulting Services
  Agreement for past obligations are rendered in full;

	
   
	
   
	
   

	
   
	
  7.4.2
	
  Payments due under this Consulting Services
  Agreement for present obligations are rendered pursuant to a payment schedule
  acceptable to the other Party; and

	
   
	
   
	
   

	
   
	
  7.4.3
	
  All other provisions of this Consulting Services
  Agreement are complied with fully.

	
   
	
   
	
   

	
  7.5
	
  Payment of Amounts Due.




          In
the event of termination of this Consulting Services Agreement, each Party
shall pay to the other Party all amounts due and owing pursuant to this
Consulting Services Agreement prior to the effective date of termination.

	
  7.6

  	
  Cooperation Upon Termination.




          Upon
termination of this Consulting Services Agreement, the Corporation shall
cooperate with CMG in transferring CMG Trade Secrets to CMG or its designated
assignee; and CMG and Corporation shall cooperate with NTI and NTI Asean in
transferring NTI Intellectual Property Rights, and NTI and/or NTI Asean Trade
Secrets to NTI, NTI Asean or their designated assignee.

	
  7.7
	
  Non-Release of Obligations.




          The
termination of this Consulting Services Agreement shall not release the Parties
from their obligations to settle all financial accounts between themselves in
cash forthwith.  Notwithstanding the
termination hereof, each Party shall be responsible for the performance of all
of its obligations and responsibilities hereunder up to the effective date of
termination.  As provided in Article 5,
upon termination of this Consulting Services Agreement, CMG Trade Secrets shall
continue to be kept secret and confidential.

	
  7.8
	
  Cessation of Rights Upon termination.




          Upon
the termination of this Consulting Services Agreement, for reason of Default or
Breach of this Consulting Services Agreement or of the Shareholders Joint
Venture Agreement or an Ancillary Agreement, all rights which the Defaulting
Party may have under or pursuant to this Consulting Services Agreement shall
forthwith cease and terminate.  If a
dispute as to whether a Default or Breach exists is submitted to Arbitration
under Article 9 hereof, the Parties shall jointly appoint a trustee or agent to
oversee the execution of the duties hereunder and the protection of the rights
hereunder of the Party allegedly in Default and/or Breach.  If the Parties cannot agree on a trustee or
agent for such purposes, the Arbitration Panel shall forthwith appoint same.

16











ARTICLE
8.

DEFAULT

	
  8.1
	
  Event of Default.

	
   
	
   

	
   
	
  A Default (“Default”) hereunder shall exist in the
  event of:

	
   
	
   

	
   
	
  8.1.1
	
  Non-payment of funds by one Party to another Party
  when due and owing; and/or

	
   
	
   
	
   

	
   
	
  8.1.2
	
  A material Breach (“Breach”) of any provision of
  this Consulting Services Agreement other than Articles 5 or 6 hereof, of the
  Shareholders Joint Venture Agreement, or any of the other Ancillary
  Agreements; and/or

	
   
	
   
	
   

	
   
	
  8.1.3
	
  A Breach of Articles 5 and/or 6 hereof.

	
   
	
   
	
   

	
  8.2
	
  Remedies Upon Default or Breach.




          The
remedies available to each Party in an instance of Default or Breach by the
other Party shall be as follows:

	
   
	
  8.2.1
	
  If a Party shall fail to make any payments required
  hereunder after the same are due, (other than due to governmental delays) or
  if it shall commit a Default or Breach in the performance of, or by failure
  to observe and comply with, any other material term or provision of this
  Consulting Services Agreement to be performed, observed or complied with by
  it, then the other Party shall have the right to declare a Default and
  terminate this Consulting Services Agreement unless the Party in Default or
  Breach shall cure such failure to pay, and/or Breach or Default, or cause the
  same to be cured, within thirty (30) days (fifteen (15) days in case of
  monetary default) after receipt of written notice from the other Party, provided,
  however, that if the Party in Default or Breach commences to cure same
  within the curative period specified herein, then the right of termination
  shall be held in abeyance for a reasonable period of time so long as the
  Party in Default or Breach proceeds to cure such Default or Breach with due
  diligence.  A Party’s right of
  termination shall be in addition to and not in limitation of any of his other
  rights at law or in equity based upon the other Party’s Default or
  Breach.  Any notice of termination
  shall stipulate the effective date of termination which shall be not less
  than three (3) months nor more than six (6) months following the date that
  such notice is given.

	
   
	
   
	
   

	
   
	
  8.2.2
	
  Notwithstanding the foregoing, in the event of a
  violation of Articles 5 and/or 6 hereof by a Party hereto, the other Party
  may at its sole discretion terminate this Consulting Services Agreement with
  immediate effect upon giving notice to the Party in Default or Breach of
  Articles 5 and/or 6 hereof as provided herein.

	
   
	
   
	
   

	
  8.3
	
  Non-Waiver of Rights.




          A
Party’s failure to terminate this Consulting Services Agreement on account of
any Breach or Default by the other Party as provided in Article 8.1 or 8.2
hereof shall in no event constitute or be deemed to constitute a waiver by such
Party of its right to terminate this Consulting Services Agreement at any time
while any such Breach or Default continues (subject to the provisions of
Article 8.2 hereof), or on account of any subsequent Breach or Default by a
Party.

17











ARTICLE
9.

DISPUTE RESOLUTION

	
  9.1
	
  Dispute Resolution by Arbitration.




          Any
and all disputes, except as excluded under Article 9.2 hereof, which may arise
between the Parties during the term of this Consulting Services Agreement,
after the termination thereof, or following the liquidation or dissolution of
the Corporation, upon failure by the Parties to amicably resolve same after
mutual good faith negotiations, shall be exclusively settled by arbitration,
including but not limited to, the following:

	
   
	
  9.1.1
	
  A dispute as to whether a Default exists;

	
   
	
   
	
   

	
   
	
  9.1.2
	
  A dispute as to whether a Default entitles the
  non-defaulting Party to terminate this Consulting Services Agreement;

	
   
	
   
	
   

	
   
	
  9.1.3
	
  A dispute as to the validity of this Article 9;

	
   
	
   
	
   

	
   
	
  9.1.4
	
  A dispute relating to the construction, meaning,
  interpretation, application or effect of this Consulting Services Agreement
  or anything contained herein;

	
   
	
   
	
   

	
   
	
  9.1.5
	
  A dispute as to the rights, obligations or
  liabilities of the Parties hereunder.

	
   
	
   
	
   

	
  9.2
	
  Disputes Not Subject to Arbitration.




          Notwithstanding
anything to the contrary set forth in this Consulting Services Agreement:

	
   
	
  9.2.1
	
  Arbitration may not be invoked regarding matters
  expressed in this Consulting Services Agreement to be agreed upon by or
  determined with the consent or approval of both Parties.

	
   
	
   
	
   

	
   
	
  9.2.2
	
  Arbitration may not be invoked if CMG, in its
  capacity as Manager of TIANJIN ZERUST, causes TIANJIN ZERUST to commit a
  Breach or Default of this Consulting Services Agreement or of the
  Shareholders Joint Venture Agreement or of any of the Ancillary
  Agreements.  Such action shall be
  considered a Breach by CMG of Article 6 hereof.

	
   
	
   
	
   

	
   
	
  9.2.3
	
  Arbitration may not be invoked if a Party violates
  the provisions of this Consulting Services Agreement relating to CMG Trade
  Secrets or Corporate Opportunity.  In
  such event, the remedies set forth in Articles 5,6 and 8 hereof shall apply.




18











	
  9.3
	
  Conduct of Arbitration Proceedings.




          Such
arbitration proceedings shall be conducted in English and shall be carried at
the Arbitration Commission of the International Chamber of Commerce of
Singapore, under the UNCITRAL Arbitration Rules.  In the interpretation of this Consulting Services Agreement, the
laws of the People’s Republic of China shall apply.  Judgment upon the award rendered by the arbitrator, including an
award concerning the payment of costs, attorneys’ fees, and expenses of the
arbitration proceedings, may be entered in any court of competent jurisdiction
and assets may be attached in any country in the world pursuant to such
judgment.

	
  9.4

  	
  Designation of the “Prevailing Party”.




          In
each case in which arbitration is invoked under this Consulting Services
Agreement, the Shareholders Joint Venture Agreement or any of the other
Ancillary Agreements, the arbitration panel shall be required to designate one
or the other Party as the Prevailing Party (“Prevailing Party”).

	
  9.5
	
  Punitive Damages Excluded.




          The
Prevailing Party in an arbitration proceeding convened hereunder shall be
entitled to recover all reasonable damages plus documented costs incurred in
pursuing its arbitration claim, including but not limited to legal fees and
travel expenses, but shall not be entitled to exemplary or punitive damages.

ARTICLE
10.

GENERAL PROVISIONS

	
  10.1
	
  Benefit of Parties.




          All
of the terms and provisions of this Consulting Services Agreement, the
Shareholders Joint Venture Agreement and of the other Ancillary Agreements
shall be binding upon the Parties executing same and their respective permitted
successors and assigns.  Except as
expressly provided herein, a Party may not assign its rights and obligations to
a third party without the written consent of the other Party; provided, however,
that a Party may assign this Consulting Services Agreement and all of its
rights hereunder (or a portion of this Consulting Services Agreement and the
rights hereunder relating thereto) to, or provide for the performance of all or
part of its obligations hereunder by, a Party which controls, is controlled by
or is under common control with such Party. 
In such event, (i) the assignor shall unconditionally guarantee the
performance and obligations of the assignee and shall not be released of its
liabilities, obligations and responsibilities hereunder and (ii) the assignee
shall expressly assume in writing and agree to perform such obligations, liabilities
and responsibilities of the assignor.

	
  10.2

  	
  Counterparts.




          This
Consulting Services Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

19











	
  10.3
	
  Cooperation.




          During
the term of this Consulting Services Agreement, each Party shall cooperate with
and assist each Party in taking such acts as may be appropriate to enable all
Parties to effect compliance with the terms of this Consulting Services
Agreement as well as those of the Shareholders Joint Venture Agreement and the
other Ancillary Agreements, and to carry out the true intent and purposes
thereof.

	
  10.4
	
  Index, Captions, Definitions and
  Defined Terms.




          The
captions of the Articles of this Consulting Services Agreement and subsections
thereof are solely for convenient reference and shall not be deemed to affect
the meaning or interpretation of any provisions hereof.  Notwithstanding the foregoing, the
Definitions set forth in Article 1 hereof, together with any other defined
terms in this Consulting Services Agreement, as identified by their insertion
in parentheses and quotation marks (“Defined Terms”), shall be incorporated
herein as written, made a part hereof, and govern the interpretation of the
text of this Consulting Services Agreement, irrespective of whether such
Definitions or Defined Terms appear in the text of this Consulting Services
Agreement before or after they are defined.

	
  10.5

  	
  Waiver of Compliance.




          The
Party for whose benefit a warranty, representation, covenant or condition is
intended may in writing waive any inaccuracies in the warranties and
representations contained in this Consulting Services Agreement or waive compliance
with any of the covenants or conditions contained herein and so waive
performance of any of the obligations of the other Party hereto, and any Breach
or Defaults hereunder; provided, however, that such waiver shall
not affect or impair the waiving Party’s rights in respect to any other
covenants, condition, Breach or Default hereunder.

	
  10.6
	
  Force Majeure.




          In
the event that a Party is prevented or delayed from performing, fulfilling or
completing an obligation provided for in this Consulting Services Agreement as
a result of delays caused by strikes, lock-outs, unavailability of materials,
acts of God, acts of any national, state or local governmental agency or
authority of a foreign government, war, insurrection, rebellion, riot, civil disorder,
fire, explosion or the elements, then the time for performance, fulfillment or
completion shall be extended for a period not exceeding the number of days by
which the same was so delayed.  If a
force majeure event shall be in existence for one year or more, then either
Party shall have the right to terminate this Consulting Services Agreement at
any time thereafter by giving at least thirty (30) days written notice of
termination to the other Party, provided that the force majeure event continues
to be in effect as of the date that such notice is given.

	
  10.7
	
  Notices.




All notices, requests,
demands or other communications which are required or may be given pursuant to
the terms of this Consulting Services Agreement shall be in writing and
delivery shall be effective in all respects if delivered (i) by telefax
promptly confirmed by letter, (ii) personally, (iii) by registered or
certified air mail, postage prepaid, or (iv) by neutral commercial courier
service, such as Federal Express, DHL, UPS or equivalent, as follows:

20












	
  If to CMG, to:
	
  Tianjin China March Group Ltd.

  Huoju Building Huayuan Industry Zone, Tianjin

  Attention:  Mr. Zhang Binhua

  Telefax:  86 022 2367 0120

	
   
	
   

	
  If to Tianjin Zerust, to:
	
  Tianjin Zerust Anti-Corrosion Technologies Ltd.

  No. 127 Tower 1 Huoju Building Huayuan Industry Zone,

  Tianjin

  Attention:  Mr. Meng Tao

  Telefax:  86 022 2367 0120

	
   
	
   

	
  Copy to:
	
  NTI ASEAN LLC

  c/o Northern Technologies International Corporation

  Attention:  President

  6680 North Highway 49

  Lino Lakes, MN  55014

  Telefax:  1-612-784-2902

	
   
	
   

	
  Copy to:
	
  Mr. Yoshiharu Rikuta

  Mr. Haruhiko Rikuta

  Taiyo Petroleum Gas Co., LTD.

  4-9 Nihonbashi-honcho l-chome

  Chuo-ku Tokyo 103

  Japan

  Telefax:  81 33 242 0986

	
   
	
   

	
  Copy to:
	
  Northern Technologies International Corporation

  Attention:  Chairman

  One Commerce Park Square

  23200 Chagrin Blvd., Suite 107

  Beachwood, OH  44122

  Telefax:  1-216-595-1741




or to such other address
as may be specified in writing by any of the above.

	
  10.8

  	
  Entire
  Agreement.




          This
Consulting Services Agreement, together with the Shareholders Joint Venture
Agreement and the other Ancillary Agreements, contain the entire understanding
of the Parties as of the date of execution of each such agreement.  There are no representations, promises,
warranties, covenants, agreements or undertakings other than those expressly
set forth or provided for in this Consulting Services Agreement, the
Shareholders Joint Venture Agreement and the other Ancillary Agreements, and
the same supersede all prior agreements and understandings between the Parties
with respect to the relationships and transactions contemplated by this
Consulting Services Agreement.  It is
the intent of the Parties to develop the relationship established hereunder,
however, and to amend and supplement this Consulting Services Agreement so as
to provide for expansion both of Net Sales of Product and of the scope of the
Corporation’s Business with Other Agreed Upon Technologies.  Any amendment or supplement to this Consulting
Services Agreement, the Shareholders Joint Venture Agreement and the other
Ancillary Agreements must, however, be clearly identified as such and set forth
in writing (“Supplemental Documents”). 
Supplemental Documents may include Corporate Resolutions and/or other
written exchanges between Parties, but must be manually signed, in the
original, by duly authorized representatives of the Parties to constitute valid
Supplemental Documents for purposes hereof.

21











	
  10.9
	
  Validity of Provisions.




          Should
any part of this Consulting Services Agreement, the Shareholders Joint Venture
Agreement or the other Ancillary Agreements be declared by any court of
competent jurisdiction to be invalid, such decision shall not affect the
validity of the remaining portion, which remaining portion shall continue in
full force and effect as if such instrument had been executed with the invalid
portion thereof eliminated therefrom, it being the intent of the Parties that
they would have executed the remaining portion without including any such part
or portion which may for any reason be declared invalid.  In the event that a provision of this
Consulting Services Agreement, the Shareholders Joint Venture Agreement, or any
other Ancillary Agreement shall be declared to be invalid, then the Parties
agree that they shall, in good faith, negotiate with one another to replace
such invalid provision with a valid provision as similar as possible to that
which had been held to be invalid, giving due recognition to the reason for
which such provision had been held invalid.

	
  10.10

  	
  Governmental Filings.




          CMG
shall be responsible for the preparation and filing of all necessary reports
relating to this Consulting Services Agreement and the transactions
contemplated hereby with each appropriate government agency in the Territory,
and shall maintain all required governmental filings and permits current.  NTI ASEAN shall provide whatever information
and documentation reasonably required of and available to it in connection with
the preparation and filing of such reports.

	
  10.11
	
  Payments.




          Any
payment to be made to CMG pursuant to any provision of this Consulting Services
Agreement shall be made by means of a wire transfer or by means of a deposit to
a bona fide bank account as designated by CMG. 
Partner shall have the right to specify in writing any bank account to
which payments due it shall be made.

	
  10.12
	
  Derivative Enforcement by NTI ASEAN.




          In
the event of a Material Breach or Default of this Consulting Services Agreement
by CMG and/or its Agents, NTI ASEAN may, derivatively for and on behalf of the
Corporation, enforce the terms hereof against CMG and/or its Agents.  In the event of derivative enforcement
hereunder, the matter shall be adjudicated in accordance with the provisions of
Article 9 hereof.

22












	
  10.13
	
  Changes Subject to Approval of NTI
  ASEAN.




          The
Parties to this Consulting Services Agreement shall not change, modify or amend
this Consulting Services Agreement in any respect without the prior written
consent of NTI ASEAN.

          IN
WITNESS WHEREOF, the Parties have executed this Consulting Services Agreement
for Management and Sales Representation as of the day and year first above
written.

	
  TIANJIN CHINA MARCH GROUP LTD.
	
   
	
  TIANJIN ZERUST ANTI-CORROSION

  TECHNOLOGIES LTD.

	
   
	
   
	
   

	
   
	
   
	
   

	
  By:  /s/
	
   
	
  By:  /s/

	
   
	
  



  	
   
	
   
	
  



  
					



APPROVAL
OF NTI ASEAN, LLC

          By
its signature hereto NTI ASEAN, LLC approves and agrees to the terms and
provisions of this Consulting Services Agreement and of the form of CMG Trade
Secrecy Agreement attached hereto, and agrees to be bound thereto to the extent
that the terms and provisions thereof are applicable to it, it being understood
that NTI ASEAN, LLC shall also have a direct right of action in its own name
for the enforcement of the provisions of this Consulting Services Agreement.


	
  NTI ASEAN, LLC
	
   

	
   
	
   

	
   
	
   

	
  By  /s/
	
  Date  1
  September 1999

	
   
	
  



  	
   

			



23










APPENDIX
III

NTI
WARRANTY DOCUMENTATION

“Because we cannot
anticipate or control the many different conditions under which our information
and our products may be used, no warranty, expressed or implied, is made except
that the product conforms to Northern Technologies International Corporation
specifications.  The technical data
furnished is believed to be accurate and complete.  Buyer assumes all risk of use, storage and handling of this
product.  Northern Technologies
International Corporation shall not be responsible for special or consequential
damages.  Nothing contained herein shall
be construed as permission to use, or recommendation for, the use of the product
in the infringement of any existing patent.”

24