R&D Negotiations

Dr. John (honorary)

Negotiations continue to go well with my friend in Taiwan. I know you
instruct to keep upfront costs down and recent issues have cropped up about
sending money wihout having a product recently (Nigeria). I am wondering how
to artfully dodge the request for 1/2 of the R&D fees. I believe that the
proposal outlinbed is mutuially understood and yes I already sent them $300
as good faith and paynment for some R&D work.

Suggestions to put them off on the 1/2 R&D cost share while maintaing the
proposal would be most appreciated. Also do I need something more formal to
firm up the proposal?? I have corresponded with these guys a lot and they
have provided several free samples so far.

Thanks

Mike

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Dear Mike :

Thanks for your reply.

Did you learn Chinese before ? It must be fun.

I got the check (NO. 222686) US$287.0 already, thanks a lot. I will threw
US$4500.0 to improve the structure of our microcapsule. Both the structure
and ingredient of microcapsule should be redesigned. And we should do a
series of experiment and test in three months. I think the market will be
huge next year. It is worthy to develop. If you can share half of the cost,
it will be much appreciated.

Proposal:
1.dye concentrate: US$90.0/LITER for trial order( 25 liter) , US$35.0/LITER
for normal order( 500 liter), base on FOB Taiwan.

2.Other companies should pay 5% more than you. I will remit 5% to you for
cooperation. The same as you mention to me.

Looking forward to hearing from you.

best regards,

Jack Wu



----- Original Message -----
From: michael d. goff
To: Jack Wu
Sent: Monday, August 13, 2001 8:49 PM
Subject: Re: The samples


Hello Jack,

No joke about your English, it is much better than my Chinese!!

Let me know if you still have not received payment this week and I will get
the check reissued.

I suspect that your costs for R&D may exceed my budget. Can you give me an
idea of what your budget is?

Let me restate my proposal - I think we are still miscommunicating:

1. If order say 1 liter of dye concentrate from you I pay $90 (or whatever
your regular price would be).

2. Any other company orders 1 liter of dye concentrate they pay $94.50 (or
5% over your regular price), you send the $4.50 to me in return for
participation in R&D and sending you many new customers.

Let me know what you think. Take Care.

Mike

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