First Graphene (ASX:FGR) entered a memorandum of understanding under which it appointed Sixth Element (Changzhou) Material Technology as a distributor for its PureGRAPH CEM additive in China, according to a Monday filing with the Australian bourse.

The agreement targets China's cement and concrete sector, and gives Sixth Element exclusivity if annual purchase targets are met, per the filing.

The deal also includes provisions to negotiate a joint venture or licensing agreement to manufacture the additive at a dedicated facility in China upon the sale of 200 tonnes of the product. The JV or licensing deal will start once 500 tonnes of PureGRAPH CEM is sold in China, the company said.

The licensing arrangement could be expanded later to allow Sixth Element to sell the product globally, per the filing.

First Graphene shares jumped past 11% in recent Monday trade.