Document:

Exhibit 10.18

 

Agency Appointment Contract

 

The Principal: (hereinafter referred to as Party A)
Tianjin New Highland Science & Technology Development Co.,Ltd.

 

The Agency: (hereinafter referred to as Party B)
Dongying Luda Petrochemical Equipment Co.,Ltd.

 

Place of Signature: Dagang District, Tianjin City

 

Date of Signature: January 11, 2010

 

Party A and Party B as mentioned above sometimes
hereinafter referred to collectively as “Parties” or individually as a “Party”

 

Definitions:

 

“Contract” refers to the Agency Appointment
Contract signed on January 11, 2010;

 

“Units” are to sets of Jet-DrillTM Semi Enclosed Skid Shallow Well
Units and sets of Jet-DrillTM Semi Enclosed Skid Deep Well Units.

 

According to the “Contract Law of the
People’s Republic of China” as well as other relevant laws and regulations, on
the basis of equality  and volition, the
Parties agree to reach the following agreement on the drill purchase.

 

 

CONFIDENTIAL
TREATMENT REQUESTED

 

Article 1 Scope of Appointment

 

Party B agrees to buy six sets of Jet-DrillTM Semi Enclosed Skid Well Units on
behalf of Party A.

 

Article 2 Requirements related to Well Units
and its Ancillary Equipment

 

The basic requirements of Party A’s purchase
of the six (6) Units are:

 

A.        Unit
Model: sets of Jet-DrillTM Semi Enclosed Skid Shallow Well Units and sets
of Jet-DrillTM Semi
Enclosed Skid Deep Well Units.

 

B.        Party
B shall be responsible for the assembly, matching and testing of the purchased
Units.

 

Article 4 Price Terms

 

Each set of the Jet-DrillTM Semi Enclosed Skid Shallow Well
Units cost [xxxx]. The total contract
price for six Units is [xxxx];

 

Date of Delivery: within ten (10) days after
the initial payment is made by Party A to Party B.

 

Place of Delivery: Tianjin City

 

 

CONFIDENTIAL
TREATMENT REQUESTED

 

Cost of Delivery: All costs related to
delivery shall be borne by Party B

 

Article 4 
Payment Terms

 

Payment will be made on a progressive basis.

 

A.        Party
A shall pay Party B the initial amount of [xxxx], which is forty(40) percent of the total contract price, within
fifteen(15) days of the signing of this Contract;.

 

B.        The
second payment of [xxxx],
which accounts for forty (40) percent of the contract price, will be made by
Party A to Party  within sixty(60) days of
the signing of this Contract;.

 

C.        The
third payment of [xxxx],
which accounts for ten(10) percent of the contract price, will be made by Party
A to Party B within one hundred and eighty(180) days of the signing of this
Contract;.

 

D.  The
balance of [xxxx], which accounts for
ten(10) percent of the contract  price,
will be paid to Party B by Party A on the date that the purchased units are
tested and accepted by Party A.

 

 

Article 5  Term of Entrustment:

 

From January 11, 2010 to December 1,2010.

 

After the expiration of the aforementioned
term, the Parties should sign a separate contract or extend the term in written
form in the case that further services are needed.

 

Article 6  Transfer of Delegation

 

Party B may not delegate its obligations
under this agreement to any third person.

 

Article 7 Inspection of Units

 

Party B shall appoint a representative to
inspect the units upon delivery. The appointed representative shall sign on the
bill of lading after inspection to confirm that all requirements are met. Party
B has the obligation to help Party A in making claims against the supplier in
the case that any defects in quality are discovered during the inspection.

 

Article 8  Party A’s Rights and Obligations

 

A.        The
right to obtain units purchased by Party B under the Contract;

 

 

B.        The
right to be informed of the progress of the affairs entrusted to Party B;

 

C.        Party
A may not enter into private deals with clients introduced by Party B during
the term of servoce or within three (3) months after the expiration of the
term.

 

D.        Party
A shall pay to Party B the contracted price after the Party B has fulfilled its
obligations.

 

Article 9  Party B’s Rights and Obligations

 

A.        The
right to complete the agency services under this Contract and to charge the
contracted price.

 

B.        Party
B shall keep Party A informed of all details on the Units in a timely manner so
as to protect Party A’s rights, and may not damage Party A’s interests by
providing fraudulent information to Party A, withhold information on the actual
circumstances of Party B, or conspire with other parties.

 

C.        The
warranty period for the purchased units is twelve (12) months after the
acceptance date of the Units. Party B shall provide free repair and maintenance
services on the purchased Units to Party A during the aforementioned warranty
period.

 

D.        Upon
the signing of the Contract, Party B may not charge Party A for any fees not
covered in the Contract.

 

 

Article 10  Default Liability

 

A.        Party
A shall pay Party B liquidated damages of one ten-thousandth (1/10000) of the
delayed payment in the case that Party A cannot make the payments as stipulated
in the Contract.

 

B.        Party
B shall pay Party A liquidated damages of one ten-thousandth (1/10000) the value
of the delayed delivery in the case that Party B cannot deliver the purchased
Units as stipulated in the Contract.

 

Article 11  Alteration and Termination of the Contract

 

Any Party who wishes to change the terms and
conditions of this contract during the period of enforcement shall issue a
notice in writing to the other Party. The terms and conditions may be changed
or a supplementary agreement may be signed with the consent of the other Party
within a period agreed upon by both Parties. The altered terms shall be duly
noted.

 

Any supplementary agreements or other writte
documents signed by both Parties during the execution of the Contract shall
constitute a part of this Contract with legal effect equal with this Contract.

 

 

Article 12  Dispute Settlement

 

All disputes
arising from the execution of or in connection with the Contract shall be
settled through amicable consultation between both Parties or intercession by a
third party. In the case that no settlement can be reached between the two
parties, either Party can take the case under dispute to the People’s Court that
has jurisdiction.

 

Article 13  This
Contract is in duplicate, with each Party holding one copy, which enters into
effect since being signed and affixed with seals by both Parties. Once the
Contract is signed and affixed with seals, it is legally binding upon both
Parties.

 

 

Party A(Seal): Tianjin New Highland Science and Technology Development Co.,Ltd.

 

 

	
  /s/ Xin Guoqiang

  	
   

  
	
   

  	
   

  
	
  (Name of Authorized Representative)

  	
   

  
	
   

  	
   

  
	
  Name: Xin Guoqiang

  	
   

  

 

 

Party B(Seal): Dongying Luda Petrochemical Equipment Co.,Ltd.

 

 

	
  /s/ Quan Xinkuan

  	
   

  
	
   

  	
   

  
	
  (Name of Authorized Representative)

  	
   

  
	
   

  	
   

  
	
  Name: Quan XinkuanExhibit
10.19

 

Exclusive Sales Agreement

 

This Exclusive Sales Agreement (“Agreement”)
is made on this 31st day of August, 2009, between Power Hydraulics LLC, located at 1632 Broad Street,
Lake Charles, LA 70601, United States, “Power Hydraulics”) and Tianjin New Highland Science and Technology
Development Company, Ltd (“Tianjin New Highland”), located at No. 86 ATNHe Road, DaGang, TianJin 300270,
China, People’s Republic of China.

 

Whereas, Power Hydraulics has certain rights
to patents (US Patent Numbers 5,413,184,
5,853,056 and 6,125,949) and is the owner or licensee of certain lateral
hydraulic jet drilling technology and
is the manufacturer of relevant equipments developed for usage with said
patents and protected intellectual technology.

 

Whereas, Tianjin New Highland desires to obtain an exclusive authorization
to purchase and use lateral hydraulic jet drilling equipment
manufactured by Power Hydraulics within the territory of the People’s Republic
of China

 

Whereas, the parties wish to enter into this
exclusive sale agreement within the territory of the People’s Republic of
China.

 

Now, therefore, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged and
agreed to, both parties hereto agree to the following terms and conditions:

 

I.         Definition.

 

The definition of “Exclusive Sale” or “Exclusive
Purchase’ shall mean for purposes hereof that Tianjin New Highland shall be the
only party which can purchase or use any of Power Hydraulics’ radial jetting
products (“Power Hydraulics’ Products”) from
Power Hydraulics within the territory of the People’s Republic of Chinn

 

II.        Appointment and Territories.

 

1.         Power Hydraulics hereby authorizes Tianjin New Highland to purchase, and Tianjin New Highland agrees to
be the exclusive purchaser of Power Hydraulics Products within the territory of
the People’s Republic of China Tianjin New Highland has agreed to exclusively
purchase radial jetting products from Power Hydraulics.

 

2.         Tianjin New Highland’s right of exclusive purchase shall remain in
force permanently after the date of this Agreement, unless terminated by one of the Parties, in which case the
Party who declares termination must inform the other Party by written notice at
least three (3) months prior to formal termination

 

III.       Products.  Tianjin New
Highland shall purchase Power Hydraulics Products under written purchase orders or manufacturing agreements (hereafter
referred to as “Purchase Documents”), in which description(s), specification(s), package(s) and quantities
are shown Tianjin New Highland’s Purchase Document shall be in writing and
signed by authorized personnel and may be sent to Power Hydraulics by facsimile or e-mail Power Hydraulics 

 

 

shall confirm
receipt, agree to the specification and terms, and notify Tianjin New Highland
after receiving Tianjin New Highland’s
Purchase Documents that Power Hydraulics accepts the  Purchase Documents. 
No manufacture or shipments
or goods by Power Hydraulics shall be made until Power Hydraulics has confirmed
Purchase Documents covering said manufacture or shipment.

 

IV.      Price.  The
price of all products, services and training will be mutually agreed upon
between Power Hydraulics and Tianjin New Highland prior to the signing or
acceptance of any purchase Documents.

 

V.        Delivery Time, Port of
Loading and Port of
Destination.   The delivery time to the port, the port of loading and the port of destination will be mutually agreed upon m a
purchase order or manufacturing contract. 
Unless otherwise stated in purchase documents, Power Hydraulics Products
are FOB Lake Charles.

 

VI.      Payment Terms.  The payment
terms will be mutually agreed upon in a written purchase docurrient.

 

VII.     Power Hydraulics’ Rights and Obligations.

 

1.         Power Hydraulics has the right to demand that Tianjin New Highland
make payments in accordance with Purchase Documents, and if payment is not
received within thirty (90) days of an agreed upon payment schedule, Power
Hydraulics, at its sole discretion, may declare Tianjin New Highland in default and terminate this Purchase
Document, upon written notice.

 

2.         Power Hydraulics shall guarantee that the quality of Power Hydraulics
Products meets the mutually agreed upon specifications (“Good Quality”)
detailed in a purchase document, and shall provide Tianjin New Highland with
products according to the mutually agreed upon times and quantities specified
in the purchase document submitted by Tianjin New Highland to, and accepted by,
Power Hydraulics.

 

3.         Power Hydraulics shall provide Tianjin New Highland timely technical
support that goes with the Power Hydraulics Products according to the Purchase
Documents and manufacturer’s warranty.

 

VIII.    Tianjin New Highland’s Rights and Obligations.

 

1.         Tianjin New Highland is the exclusive purchaser and shall have the
exclusive rights in the People’s Republic of China for the purchase and use of
Power Hydraulics Products.

 

2.         Tianjin New Highland has the right to request Power Hydraulics to
provide Power Hydraulics Products in a timely
manner in sufficient quantities and of Good Quality and timely technical
support for the Power Hydraulics Products in a manner generally accepted
in the industry.

 

3.         Tianjin New Highland has a right, before payment or acceptance, to
inspect product, shipped by Power Hydraulics at any reasonable place and time
and in any reasonable manner.  When Power
Hydraulics is required or authorized to send the products to 

 

2

 

Tianjin New Highland, the
inspection may be after their arrival.  Expenses of inspection may be borne by
Tianjin New Highland but shall
be recovered from Power Hydraulics if the
goods do not conform to the Purchase Documents and are rejected.

 

4.         If the
goods or the tender of delivery by Power Hydraulics fail in any material
respect  to conform to the Purchase
Documents, Tianjin New Highland may

 

(a)      reject the whole; or

 

(b)      accept the whole, or

 

(c)      accept any commercial unit or units and reject the rest

 

5.         Tianjin New Highland is solely responsible for providing the fully detailed requirements for China-specific specifications to
Power Hydraulic Products so products shall comply with the import laws of the
People’s Republic of China, however, in the event of refusal of entry into the
People’s Republic of China and/or required re-export of Power Hydraulics
products subject to this agreement, due to non-compliance on the part of Power
Hydraulics with the specifications provided to them by Tianjin New Highland
causing customs or other relevant agencies of the People’s Republic of China
prevent entry, Power Hydraulics shall arrange for and pay for the said
re-export.  Power Hydraulics shall also
compensate Tianjin New Highland for any ordinary and reasonable costs or fees associated with such non-compliance incurred
by Tianjin New Highland, including any consequential damages suffered by
Tianjin New Highland due to its inability to use the Power Hydraulics Products
within the known operating limitations. 
In any case, the total compensation shall not to exceed $100,000.00 per
purchase document.

 

6.         Tianjin New Highland shall make payment to Power Hydraulics according to every purchase document and
fulfill its obligations under this Agreement.

 

IX.      Default

 

Any material breach
by either Party shall he regarded as a default. 
The breaching Party may be responsible for all ordinary or reasonable
damages and loses arising from its default.

 

X.        Governing Law
and Dispute Resolution

 

All terms and
conditions of this Agreement shall be governed by the laws of the State of
Louisiana, the United States of America. 
Any dispute arising from or in connection with this Agreement shall be
settled by arbitration in Lake Charles, Louisiana or any other mutually agreed
upon location or jurisdiction.  The
arbitration shall be final and binding on the Parties.

 

Each Party to the
admiration shall cooperate with each other Party to the arbitration in making
full disclosure of and providing complete access to all information and
documents requested by such other Party in connection with such arbitral
proceedings, subject only to any confidentiality obligations binding on such
Party.  During the course of the arbitral
panel’s adjudication of the Dispute, this Agreement shall continue to be
performed except with respect to the part in dispute and under adjudication.

 

3

 

XI.      Language and Explanation of the Agreement

 

This
Agreement shall be executed in English and translated into Chinese, but the
English version shall prevail over the Chinese version with regard to the interpretation
of this contract.

 

XII.     Other Terms

 

1.         Each
Party agrees not to disclose any Confidential Information of the other Party
and to maintain such Confidential Information in strictest confidence, to take
all reasonable precautions to prevent its unauthorized dissemination and to
refrain from sharing any or all of the information with any third party for any
reason whatsoever except as required by court order, both during and after the
termination of this Agreement.  Without
limiting the scope of this duty, each Party agrees to limit its internal
distribution of the Confidential Information of the other party only on a “need
to know” basis and solely in connection with the performance of this Agreement,
and to take steps to ensure that the dissemination is so limited.

 

2.         This
Agreement shall come into effect from the date that both parties sign.

 

3.         This
Agreement shall be in duplicate to be held by each Party.  Each copy shall have equal legal effect.

 

4

 

The Parties hereto execute this Agreement as
of the date set forth above.

 

 

Power Hydraulics, LLC

 

 

	
  /s/Daniel J. Jacobson

  	
   

  
	
   

  	
   

  
	
  (Name of Authorized Signatory)

  	
   

  
	
   

  	
   

  
	
  Name: Daniel J.
  Jacobson

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Position:
  Director

  	
   

  

 

5

 

Tianjin New Highland Science and Technology Development Company, Limited

 

 

	
  /s/ Guoqiang Xin

  	
   

  
	
   

  	
   

  
	
  (Name of Authorized Signatory)

  	
   

  
	
   

  	
   

  
	
  Name: Guoqiang Xin

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Position: CEO

  	
   

  

 

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