Exhibit 10.1

 

 

MAGNEGAS SYSTEMS PURCHASE AGREEMENT

 

THIS MAGNEGAS SYSTEMS PURCHASE AGREEMENT (this “Agreement”) is made as of this
16th day of October, 2017 (the “Effective Date”) by and between MAGNEGAS
CORPORATION, a Delaware corporation and MAGNEGAS ENERGY SOLUTIONS, LLC, a
Delaware limited liability company (“MagneGas”) and TALON VENTURES & CONSULTING
GMBH, a company constituted under the laws of Germany (“TALON”). MagneGas and
TALON are each referred to herein individually as a “Party,” and jointly as the
“Parties.”

 

RECITALS

 

WHEREAS, MagneGas is engaged in the business of developing and manufacturing
gasification and sterilization equipment that operate with MagneGas’ proprietary
technology to generate a proprietary gaseous fuel from certain waste products
(the “MagneGas Fuel”).

 

WHEREAS, TALON is a company doing business in Germany with access to a
distribution network in Germany for potential marketing of MagneGas Fuel.

 

WHEREAS, MagneGas and TALON previously entered into that certain MagneGas
Systems Purchase Agreement dated as of December 30, 2016 (the “First Sale
Agreement”), providing for the sale of the MagneGas Systems (as defined below)
to TALON, within a limited Territory (as defined below) and subject to the terms
and conditions described in the Licensing and Distribution Agreement (the
“Distribution Agreement”) entered into between MagneGas and TALON.

 

WHEREAS, MagneGas desires to sell and TALON desires to purchase a second
MagneGas System (the “Second MagneGas System”).

 

WHEREAS, The purpose of this Agreement is to set forth the terms and conditions
upon which MagneGas will sell to TALON and TALON will purchase the Second
MagneGas System from MagneGas, and the respective duties, obligations, and
responsibilities of each of the Parties.

 

WHEREAS, MagneGas agrees that all services, warranties and obligations that are
owed to TALON will fully apply to all customers of TALON (or a respective
subsidiary) who have purchased MagneGas equipment (gasification units,
sterilization units, periphery). All respective claims shall be handled directly
by MagneGas as manufacturer of the equipment.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties, intending to be legally bound,
hereby agree as follows:

 

OPERATIVE TERMS AND CONDITIONS

 

1.       DEFINITIONS

 

In addition to any other term defined elsewhere in this Agreement, the following
terms shall have the respective meanings set forth below.

 

1.1       “Affiliate” means any legal entity that is owned by, owns, or is under
common Ownership with a party. "Ownership" means more than 50% of the voting
interests of a Party, whether attained through stock or equity ownership or
through a contractual arrangement.

 

1.2       “Commissioning” shall mean the process of deeming a MagneGas System to
be operational and successful in producing MagneGas within the specifications
for such system as set forth in this Agreement.

 

1.3       “Confidential Information” shall have the meaning set forth in Section
12.1.

 

 

 

 

1.4       “Construction Completion Deadline” shall have the meaning set forth in
Section 4.4.

 

1.5       “Distribution Agreement” shall have the meaning ascribed to that term
in the recitals to this Agreement.

 

1.7       “Force Majeure Event” shall have the meaning set forth in Section
13.1.

 

1.8       “Gasifier” shall have the meaning set forth in Section 1.13.

   

1.9       “Losses” shall mean any and all damages, settlement amounts,
assessments, fines, dues, penalties and other costs and expenses (including,
without limitation, court costs, interest and reasonable fees of attorneys,
accountants and other experts) required to be paid to third parties with respect
to the claim, suit, or action in question by reason of any judgment, order,
decree, stipulation or injunction, or any settlement entered into in accordance
with the provisions of this Agreement, together with all documented
out-of-pocket costs and expenses incurred in complying with any judgments,
orders, decrees, stipulations and injunctions that arise from or relate to such
claim, suit, or action.

 

1.10       “MagneGas Fuel” shall mean the fuel manufactured by a MagneGas
Gasifier or Sterilization Unit as defined in the Recitals to this Agreement.

 

1.11       “MagneGas Indemnified Party” shall have the meaning set forth
in Section 11.2

 

1.12       “MagneGas Regulators” shall mean the gauges used on the cylinders to
regulate fuel flow.

 

1.13        “MagneGas System” shall mean: (a) a 300KW stationary Gasification
Unit manufactured by MagneGas based on technology which gasifies liquid waste
(the Vertical Gasification Gasifier) as specified on Exhibit A (the “Gasifier”).

 

1.14       “Mag2” shall mean the MagneGas Fuel produced with a Gasifier from oil
feedstock.

 

1.15       “Notice of Completion” shall have the meaning set forth in Section
4.4.

 

1.16       “Person” or “person” shall mean any natural person, corporation,
partnership, limited liability company, proprietorship, association, trust, or
other legal entity.

 

1.17       “Second MagneGas System” shall have the mean set forth in Section
1.13.

 

1.18       “Sterilization Unit” shall have the meaning set forth in Section 1.8.

 

1.19       “TALON Indemnified Parties” shall have the meaning set forth
in Section 11.1.

 

1.20       “Territory” shall have the meaning ascribed to such term in the
Distribution Agreement.”

 

2.       TERM.

 

2.1       Term. The term of this Agreement will be effective from the date first
set forth above and will remain in effect thereafter for one (1) year from its
effective date (the “Term”), provided that certain specified provisions of this
Agreement shall survive the termination of the Term, as indicated herein.

 

2.2       Renewal. Any renewal terms of this Agreement that may be contemplated
or necessary to allow additional time for a party’s performance hereunder, if
any, shall be negotiated by the Parties in their sole discretion.

 

 

 

 

3.       PURCHASE AND SALE COMMITMENT.

 

3.1       Sale of Second MagneGas System. Subject to the terms and conditions
herein, MagneGas will sell to TALON, and TALON will purchase from MagneGas the
following: (a) one Gasifier as identified on Exhibit A.

  

3.2       Purchase Price. The purchase price is (a) One Million Five Hundred
Seventy Five Thousand and NO/100 ($1,575,000.00) for the Gasifier (the “Purchase
Price”). The Purchase Price is F.O.B. MagneGas’ facility at Company Headquarters
in Clearwater, Florida. The Purchase Price does not include any taxes or tariffs
that may be imposed on the transaction and be a cost to TALON.

 

3.3       Delivery Commitment. Delivery of the Second MagneGas System will be
accepted by TALON at MagneGas’s headquarters in Florida. TALON will be
responsible for arranging and paying for shipment to TALON’s facility in Germany
or such other location where TALON will choose to have the MagneGas Systems
installed.

 

4.       DEPOSIT, PAYMENT AND DELIVERY.

 

4.1       Manner of Payment: Currency. All payments for the Purchase Price of
the Second MagneGas System or otherwise in connection therewith shall be
calculated and paid in U.S. Dollars and shall be paid by cash wire transfer to
the following account in the name of MagneGas, to be confirmed by email wire:

 

PNC Bank

 

  FBO: MagneGas Corporation

11885 44th Street North

Clearwater, FL 33762

 

4.2       Payments. A partial payment of the One Million and NO/100 Dollars
($1,000,000) due shall be made to MagneGas at its indicated account within six
(6) months following the execution of this Agreement. The balance of the
Purchase Price must be paid to MagneGas at its indicated account on or before
the one (1) year anniversary following the execution of this Agreement. Time is
of the essence for any payments under this Agreement and payments hereunder
shall be due not later than fifteen (15) business days of the due date stated
herein. If a payment is not received fifteen (15) business days after the due
date, and is not disputed in good faith by TALON, MagneGas shall provide written
notice to TALON of the payment default, and if not cured within five (5)
business days after receipt of the written notice from MagneGas, it shall be
considered a “Payment Breach” and MagneGas shall not be obligated to commence
construction or perform any other duties hereunder until the Payment Breach is
cured. In the event of a Payment Breach, the provisions of Sections 4.3 and
4.4 below shall cease to apply to this Agreement and MagneGas’s sole obligation
will be to complete performance hereunder upon receipt of the delinquent
payment. In the event of such a Payment Breach, this agreement will be deemed
terminated and both parties acknowledge no recourse to either party and MagneGas
shall be entitled to maintain possession of the Second MagneGas System in
whatever stage of completion.

 

4.3       Completion Deadline and Delivery. MagneGas shall complete manufacture
of the Gasifier on or before the one (1) year anniversary of this Agreement
(the “Construction Completion Deadline”). The MagneGas Systems shall be deemed
to have been completed when MagneGas notifies TALON that it has completed
construction of each MagneGas Systems and has tested it to produce MagneGas (a
“Notice of Completion”).

 

4.4       Transfer of Title/Shipment and Delivery. Title to the Second MagneGas
System will transfer to TALON upon payment in full as required in Section 4.2
and 4.3 and upon MagneGas’s issuance of a Notice of Completion. Subject to the
provisions of Section 4.5 below, freight, insurance, transportation and all
other costs associated with shipment to Talon’s facility shall be borne solely
by TALON, and are not included in the Purchase Price, with MagneGas to be named
as an additional insured party under any insurance policy covering the Second
MagneGas System while in transit. Title and risk of loss passes jointly to the
Parties upon issuance of the Notice of Completion and prior to shipment of the
Second MagneGas System out of the MagneGas facilities.

 

 

 

 

4.5       Shipping and Delivery Terms.

 

(i)       The Second MagneGas System will be packed and shipped in a
commercially reasonable manner mutually agreed by the parties, consistent with
industry standards, and in compliance with applicable law. MagneGas shall make
all necessary arrangements for shipment of the Second MagneGas System to the
Talon facility, at Talon’s cost and expense, but MagneGas will not be held
responsible for delays or costs related to the shipment of the Second MagneGas
System to Germany.

 

(ii)       TALON will be responsible for bringing all utilities (water,
electricity etc.) to the Talon facility where the Second MagneGas System will be
installed. TALON will be responsible for obtaining all required governmental
permits and for preparing the site and surrounding area in its entirety for the
delivery and set up of the Second MagneGas System, including ensuring that the
site meets the specifications set forth on Exhibit B. MagneGas will be
responsible for providing two technicians, at its sole expense, to assist with
the installation of the Second MagneGas System.

   

5.       ADDITIONAL OBLIGATIONS OF THE PARTIES.

 

5.1       Training. At its sole expense, TALON shall send two of its
representatives to MagneGas’s operations in Clearwater, FL to train with
MagneGas technicians on the proper installation, operation, and maintenance of
the Gasifier (a “Train the Trainer Approach”) for a period of up to two (2)
continuous weeks. The cost of such training (except for the travel and lodging
costs of the TALON personnel) is included in the Purchase Price.

 

5.2        Installation. At its sole expense, MagneGas shall provide one
technician to travel to the site of installation to assist for up to two weeks
with set up, installation and commissioning of the Second MagneGas System. Upon
completion of such period, MagneGas will certify the Second MagneGas System as
operational in accordance with such standards as the parties have accepted as
set forth on Exhibit C (the “Commissioning Date”).

 

5.3       Service and Repair. MagneGas shall provide a service kit containing
the items identified on Exhibits A and B with the Second MagneGas System
delivered to the Talon facility, to support one (1) year of component failures,
at no additional cost.

 

5.4       Compliance with Law; Licenses and Approvals. Each Party shall comply
in all material aspects with all laws, rules, regulations, and other
governmental requirements applicable to such Party’s performance or obligations
under this Agreement, and shall obtain and maintain all material governmental
permits, licenses, and consents required in connection therewith. For
clarification purposes, Talon shall be responsible for all permits, licenses,
consents and any other compliance relative to the operation of the Second
MagneGas System or use of MagneGas Fuel in the facility and in the Territory.

 

5.5       Independent Contractors. Neither MagneGas nor TALON is, nor will be
any of them be deemed to be, an agent, legal representative, joint venturer,
partner, or employee of the other for any purpose. For avoidance of doubt,
neither MagneGas nor Talon will be entitled to (a) enter into any contracts in
the name of or on behalf of each other, (b) pledge the credit of any party other
than itself in any way or hold itself out as having authority to do so, or (c)
make commitments or incur any charges or expenses for or in the name of each
other. As to each other, for purposes of this Agreement, MagneGas and TALON
shall be independent contractors.

 

5.6       Transfer of Rights. TALON will have the right to transfer all rights
resulting from this agreement to a customer or a subsidiary that will physically
execute the business.

 

 

 

 

5.7 Customer Claims. MagneGas agrees that all services, warranties and
obligations that are owed to TALON will fully apply to all customers of TALON
(or a respective subsidiary) who have purchased MagneGas equipment (gasification
unit, periphery). All respective claims shall be handled directly by MagneGas as
manufacturer of the equipment.

 

6.       NO LICENSE GRANTED. The purchase of the Second MagneGas System does not
comprise a grant of any license to TALON to use the name “MagneGas” or to sell
or distribute any MagneGas Fuel. Any rights to such a license exist and are
granted only pursuant to the terms of the Distribution Agreement.

 

7.       TERMINATION.

 

7.1       Termination Without Cause. Notwithstanding anything stated herein,
this Agreement may be terminated without cause only on the following terms:

 

(i)       By either Party, if a court of competent jurisdiction or governmental
authority, regulatory, or administrative agency or commission shall have enacted
any law, statute, rule, or regulation, or issued any final and non-appealable
order or decree that permanently restrains, enjoins, or otherwise prohibits
either Party from substantially performing under this Agreement; or

 

(ii)       By either party due to the failure of successful testing of the
completed Second MagneGas System.

 

7.2       Termination For Cause. This Agreement may be terminated for cause on
the following terms:

 

(i)       by either Party if the other Party breaches or fails to comply with
any material term, condition, or obligation required to be performed or complied
with by such other Party under this Agreement, and such material breach or
failure is not cured within forty-five (45) days following written notice
thereof by the terminating Party;

  

(ii)        by either Party if the other Party (a) institutes any insolvency,
receivership, or bankruptcy proceedings, or any other proceedings for the
settlement of its debts, (b) has any such proceedings instituted against it,
which proceedings are not dismissed or otherwise resolved in its favor within
one hundred and twenty (120) days thereafter, (c) makes a general assignment for
the benefit of its creditors, or (d) is dissolved or permanently ceases to
conduct business in the ordinary course; or

 

(iii)       By MagneGas in the event of a Payment Breach by TALON.

 

7.3       Rights and Obligations on Expiration or Termination.

 

(i)       In the event of a Termination for Cause, the terminating Party may
also be entitled to damages subject to the limitations of Article 10 and
this Section 7.3. To the extent termination is in connection with a Payment
Breach, MagneGas may, at its option, make demand for the sums due and owing and
shall retain any partial payments of the Purchase Price as liquidated damages.

 

(ii)       In the event of a Termination Without Cause under Section 7.1(i) due
to MagneGas’s inability to perform, MagneGas shall promptly refund all amounts
paid it by TALON under this Agreement (subject to retention of any partial
payments of the Purchase Price which are non-refundable).

 

7.4       Survival. All of the respective obligations, representations and
disclaimers of the Parties set forth in this Agreement shall survive the
execution and delivery of this Agreement and the delivery of the Second MagneGas
System to the Facility.

 

 

 

 

8.       REPRESENTATIONS AND WARRANTIES; DISCLAIMER OF ADDITIONAL WARRANTIES;
COVENANTS BY TALON.

 

8.1       By Both Parties. Each Party represents and warrants to the other Party
that (a) it has the requisite corporate power and authority to enter into and
perform its obligations under this Agreement, (b) it is not a party to any
agreement or understanding, and knows of no law or regulation, that would
prohibit it from entering into and performing its obligations under this
Agreement, or that would conflict with this Agreement, and (c) when executed and
delivered by it, this Agreement will constitute a legal, valid and binding
obligation of it, enforceable against it in accordance with the terms hereof.

 

8.2       Additional Warranties of MagneGas. MagneGas additionally represents
and warrants to TALON that (a) it owns or has sufficient rights to manufacture
and sell the Second MagneGas System that will be supplied pursuant to this
Agreement, (b) title to the Second MagneGas System will be conveyed to TALON
free and clear of any liens or encumbrances, (c) it has sufficient manufacturing
capacity and access to sufficient quantities of raw materials and component
parts, materials and ingredients to produce and provide the Second MagneGas
System to which it has committed hereunder, (d) such Second MagneGas System is
protected by patents issued by the US Patent and Trademark Office (the “USPTO”)
or is otherwise covered by patents pending with the USPTO, and to the best
knowledge of MagneGas does not infringe on the intellectual property of any
third party in the United States; (e) such Second MagneGas System, at the time
of shipment, and for a period of one year thereafter, will conform in all
material respects with the agreed-upon specifications for such Second MagneGas
System as set forth on Exhibit A and Exhibit B, respectively, (f) such Second
MagneGas System shall be fit for their intended purpose, reasonably safe for use
in accordance with the instructions provided to TALON in writing, and free from
any defects in design or manufacturing, and (g) that as of the date hereof the
use of the Second MagneGas System to make MagneGas Fuel complies with the
applicable laws and regulations of the United States and Florida, and that
MagneGas has provided or made available to TALON all third party reports
received by it certifying or relating to such compliance or to the content of
emissions from the Second MagneGas System during the processing or manufacturing
of MagneGas Fuel. MagneGas makes no representation as to the Second MagneGas
System’s compliance with the laws and regulations of any country other than the
United States of America, and has not undertaken to determine whether use of the
Second MagneGas System in the Territory is compliant with local laws and
regulations. MagneGas also provides the specific warranties contained in Exhibit
D hereto.

 

8.4       Additional Warranties of TALON. TALON additionally represents and
warrants to MagneGas that neither TALON nor any of its representatives will
intentionally make any oral or written representations which vary materially
from the specifications, warranties, or representations by MagneGas with respect
to the Second MagneGas System or the MagneGas Fuel as stated in packaging or
written documentation provided in writing by MagneGas to TALON relating to the
Second MagneGas System or MagneGas Fuel. TALON acknowledges that TALON is solely
responsible for ensuring compliance with the laws of the Territory, including,
but not limited to, all environmental laws and regulations and all applicable
laws and regulations at the federal, state and local levels in the Territory,
during the initial installation of the Second MagneGas System in Talon’s
facility for the manufacture of the MagneGas Fuel. TALON further warrants and
covenants that it will not reverse engineer, grant access to the Second MagneGas
System to third parties for the purpose of reverse engineering, or otherwise
misappropriate the Second MagneGas System’s technology. TALON acknowledges that
the foregoing covenant is particularly important to MagneGas and that MagneGas
is relying on this covenant and on the confidentiality provisions of Section
12 hereof in order to enter into this Agreement. TALON will further promptly
notify MagneGas if and when it becomes aware of any apparent infringement of the
MagneGas technology in the Territory.

 

8.5       Disclaimer of Additional Warranties. EXCEPT AS EXPRESSLY SET FORTH
HEREIN, NEITHER. PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES TO THE OTHER, AND
ALL SUCH OTHER WARRANTIES, EXPRESS OR IMPLIED, ARE HEREBY DISCLAIMED.

 

8.6       Warranty Remedies. IN THE EVENT OF ANY BREACH OF ANY OF THE SECOND
MAGNEGAS SYSTEM’S WARRANTIES CONTAINED HEREIN, TALON MAY REQUIRE THE REPAIR OR
REPLACEMENT OF THE DEFECTIVE SECOND MAGNEGAS SYSTEM OR PART, OR RETURN OF THE
PRICE PAID BY TALON.

 

 

 

 

9.       LIMITED PURCHASE OF GAS. MagneGas agrees for a period of forty (48)
months after delivery and commissioning of the Second MagneGas System, but no
more than thirty (30) days after delivery thereof, that if TALON wants to sell
its gas to MagneGas while building the market for MagneGas in the Territory,
TALON will agree to do so at a delivered-to-Magnegas price of $0.36/cubic ft.
Additionally, the gas will have to be delivered within MagneGas’s specifications
and in cylinders or containers that conform to US DOT standards and regulations.
The parties may agree to extend the buyback program upon mutually acceptable
terms. This paragraph extends to TALON customers (or customers of a designated
Talon subsidiary) who buy MagneGas equipment from TALON.

 

10.      LIMITATIONS OF LIABILITY.

 

10.1       Limitation on Certain Damages. IN NO EVENT SHALL A PARTY BE LIABLE TO
THE OTHER PARTY FOR ANY SPECIAL, INDIRECT, PUNITIVE, OR. CONSEQUENTIAL DAMAGES
OF ANY KIND (INCLUDING, WITHOUT LIMITATION, LOST PROFITS, BUSINESS, OR GOODWILL)
IN CONNECTION WITH THE SECOND MAGNEGAS SYSTEM, THE MAGNEGAS FUEL OR ANY OTHER
MATTER COVERED BY THIS AGREEMENT, REGARDLESS OF WHETHER SUCH LIABILITY IS BASED
ON BREACH OF CONTRACT, TORT, STRICT LIABILITY, BREACH OF WARRANTY, OR ANY OTHER
THEORY, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
THE FOREGOING LIMITATION OF LIABILITY REFLECTS A DELIBERATE AND BARGAINED FOR
ALLOCATION OP RISKS BETWEEN TALON AND MAGNEGAS AND IS INTENDED TO BE INDEPENDENT
OF ANY EXCLUSIVE REMEDIES AVAILABLE UNDER THIS AGREEMENT, INCLUDING ANY FAILURE
OF SUCH REMEDIES TO ACHIEVE THEIR ESSENTIAL PURPOSE.

 

10.2       THE TOTAL LIABILITY OF MAGNEGAS FOR ANY AND ALL LOSSES AND DAMAGES
ARISING OUT OF ANY CAUSE WHATSOEVER (WHETHER SUCH CAUSE BE BASED IN CONTRACT,
NEGLIGENCE, STRICT LIABILITY, OTHER TORT OR OTHERWISE) SHALL BE LIMITED TO
ACTUAL OUT-OF-POCKET DAMAGES, INCLUDING BUT NOT LIMITED TO GOVERNMENTAL FINES,
AND IN NO EVENT EXCEED THE PURCHASE PRICE (INCLUDING ROYALTIES PAID, IF ANY) OF
THE SECOND MAGNEGAS SYSTEM IN RESPECT TO WHICH SUCH CAUSE ARISES. IN THE EVENT
THAT THE LIABILITY FOR LOSS AND/OR DAMAGE ARISES IN CONNECTION WITH THE
MALFUNCTION OF THE SECOND MAGNEGAS SYSTEM OR PART THEREOF, AT MAGNEGAS’S OPTION,
MAGNEGAS MAY INSTEAD REPAIR OR REPLACE SUCH PRODUCTS, BUT IN NO EVENT SHALL
MAGNEGAS BE LIABLE FOR INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES RESULTING
FROM ANY PRODUCT DEFECT.

 

10.3       IN THE EVENT OF A TERMINATION OF THIS AGREEMENT BY MAGNEGAS DUE TO A
FORCE MAJEURE EVENT AS SET OUT IN SECTION 13.1, MAGNEGAS’ SOLE OBLIGATION
HEREUNDER AND TALON’S SOLE REMEDY SHALL BE THE RETURN OF THE PURCHASE PRICE.

 

10.4       Essential Part of the Bargain. The Parties acknowledge that the
limitations of liability set forth in this Article 10 are an essential element
of this Agreement between the Parties, and that the Parties would not have
entered into this Agreement but for such limitations of liability.

 

11.       INDEMNIFICATION.

 

11.1       Indemnification by MagneGas. MagneGas shall defend and/or settle any
and all third party claims, suits, and actions asserted against TALON, its
Affiliates, or their respective employees, officers, directors, managers,
shareholders, members, agents, Affiliates, successors, and assigns (each, a
“TALON Indemnified Party”), to the extent such claims, suits or actions arise
from or are based on (i) any breach by MagneGas of any of its representations,
or warranties set forth in Article 8 or (ii) an actual or alleged claim of
infringement or misappropriation of a patent, copyright, trademark or trade
secret of any third party in connection with TALON’s use of the Second MagneGas
System. All settlements under this Section 11.1 shall be subject to discussion
with TALON and shall require the prior written consent of both Parties. TALON
(and the applicable TALON Indemnified Parties) shall at all times have the
option, at its own expense, to participate in the defense or settlement of the
claim, suit, or action (including, without limitation, through counsel of its
own selection). In addition, MagneGas shall indemnify and hold harmless the
TALON Indemnified Parties from and against any and all Losses suffered or
incurred by any of them in connection with any such claims, suits, or actions.

 

 

 

 

11.2       Indemnification by TALON. TALON shall defend and/or settle any and
all third party claims, suits, and actions asserted against MagneGas, its
Affiliates, or their respective its employees, officers, directors, managers,
shareholders, members, agents, Affiliates, successors, and assigns (each, a
“MagneGas Indemnified Party”), to the extent such claims, suits or actions arise
from or are based on any breach by TALON of any of its representations or
warranties set forth in Article 8 or any material modification of the Second
MagneGas System not approved by MagneGas. All settlements under this Section
11.2 shall be subject to discussion with MagneGas and shall require the prior
written consent of both Parties. MagneGas (and the applicable MagneGas
Indemnified Parties) shall at all times have the option, at its own expense, to
participate in the defense or settlement of the claim, suit, or action
(including, without limitation, through counsel of its own selection). In
addition, TALON shall indemnify and hold harmless the MagneGas Indemnified
Parties from and against any and all Losses suffered or incurred by any of them
in connection with any such claims, suits, or actions.

 

12.       CONFIDENTIALITY

 

12.1       Confidential Information. As used in this Agreement, “Confidential
Information” means any material or information disclosed by either Party to the
other Party, in writing, orally or by inspection of tangible objects (including,
without limitation, material or information relating to such Party’s research,
development, customers, prospective customers, markets, finances, or other
business interests or trade secrets), which is designated in writing as
“Confidential,” “Proprietary” or some similar designation.

 

12.2       Confidentiality and Non-Use. Each Party shall treat as confidential
all Confidential Information of the other Party, shall not use such Confidential
Information except to exercise its rights and perform its obligations under this
Agreement, and shall not disclose such Confidential Information to any third
party, except to its attorneys and other advisors provided that such third party
agrees in writing to abide by restrictions on confidentiality and non-use that
are substantially the same as those set forth herein. Without limiting the
foregoing, each Party shall use at least the same degree of care it uses to
prevent the disclosure of its own confidential information of like importance,
which care shall be no less than reasonable care, to prevent the disclosure of
Confidential Information of the other Party. Each Party will promptly notify the
other Party of any actual or suspected misuse or unauthorized disclosure of the
other Party’s Confidential Information.

 

12.3       Exceptions. The provisions of this Article 12 shall not apply to
material or information that: (a) was in the public domain at the time it was
disclosed or has become in the public domain through no fault of the receiving
Party; (b) was known to the receiving Party, without restriction, at the time of
disclosure (other than through a disclosure to the receiving Party by the
disclosing Party prior to the Effective Date), as demonstrated by documentation
in existence at the time of disclosure; (c) is disclosed with the prior written
approval of the disclosing Party; (d) was independently developed by the
receiving Party without use of any Confidential Information of the disclosing
Party; (e) becomes known to the receiving Party, without restriction, from a
third party not bound by an obligation of confidentiality; or (f) is disclosed
generally to third parties by the disclosing Party without restrictions similar
to those contained in this Article 12. In addition, the receiving Party may
disclose the other Party’s Confidential Information to the extent such
disclosure is required by law or by order or requirement of a court,
administrative agency, or other governmental body, provided that the receiving
Party provides prompt notice thereof to the disclosing Party so as to afford the
disclosing Party reasonable opportunity to seek a protective order or otherwise
prevent or restrict such disclosure.

 

12.4       Confidentiality of Agreement. The terms and conditions of this
Agreement, but not its existence, shall be treated as Confidential Information
of each Party. Upon the advance written consent of both Parties, not to be
unreasonably withheld, the Parties may elect to issue press releases or other
forms of publicity regarding the specific terms and conditions of this Agreement
or regarding the business relationship under this Agreement. 

 

 

 

 

13.       GENERAL PROVISIONS.

 

13.1       Force Majeure. Neither Party shall be considered in default of its
performance of any obligation hereunder (other than an obligation to make any
payment due hereunder) to the extent that performance of such obligation is
prevented or delayed by any act of God or other cause beyond such Party’s
reasonable control, including, without limitation, any act, failure to act, or
delay in acting on the part of any governmental authority (including the
imposition of regulations which would prohibit the sale or manufacture of the
Second MagneGas System or of MagneGas Fuel or which would require additional
research and development and with which a Party would be unable to comply within
a reasonable time); strikes or other labor difficulties; accidents or
disruptions such as fire, explosion, terrorism, flood, epidemics, unanticipated
breakdown, failure, or delay of third party essential machinery or
telecommunications services, or civil disturbance (each, a “Force Majeure
Event”). If any Force Majeure Event does arise, occur, or result, the Party
subject thereto shall use commercially reasonable efforts to minimize the
consequences of such Force Majeure Event and to overcome such Force Majeure
Event as soon as reasonably possible. A Party desiring to rely upon any Force
Majeure Event as an excuse for failure, default, or delay in performance shall
provide the other Party with a written description of the facts giving rise to
said event when it arises and statement claiming Force Majeure giving rise to
suspension of the Parties’ obligation hereunder during the pendency of such
conditions of Force Majeure. If such Party is not able to perform within ninety
(90) days after the event giving rise to the excuse of Force Majeure, the other
Party may terminate this Agreement.

 

13.2       Assignment; Binding Effect. Either Party may, assign, delegate, or
otherwise transfer this Agreement, or any of its rights or obligations hereunder
with the prior written consent of the other Party, and any such assignment,
delegation, or transfer. Subject to the foregoing, all of the terms and
conditions of this Agreement shall be binding upon and shall inure to the
benefit of the Parties and their respective successors and assigns.

 

13.3       No Rights In Third Parties. Nothing in this Agreement will confer any
rights upon any person other than the Parties and their respective successors
and assigns.

 

13.4       Choice of Law: Jurisdiction. This Agreement and its subject matter
shall be governed by and interpreted in accordance with the laws of the State of
Florida, without reference to any principles governing conflicts of law that
might cause the laws of any other jurisdiction to apply. Each party accepts the
venue provisions of this Section 13.4 and waives its right to any other forum to
which it may otherwise be entitled by virtue of its nationality or place of
residence.

 

13.5       Legal Fees. If either Party brings an action against the other Party
in order to enforce the terms and conditions of this Agreement, the
non-prevailing Party in such action shall pay all reasonable costs and expenses
(including attorneys’ fees) incurred by the prevailing party.

 

13.6       Notices. All notices required under this Agreement shall be deemed
effective upon receipt and shall be (a) delivered personally, (b) sent via
overnight delivery using a nationally recognized courier service (e.g., UPS or
FedEx), to the Party to be notified, at the address(es) for such Party set forth
below, or at such address(es) of which such Party has provided notice in
accordance with the provisions hereof, as follows: 

 

To MagneGas: MagneGas Corporation   11885 44th St. North   Clearwater, FL 33762
  Attn: Ermanno Santilli, CEO         To TALON: Talon Ventures and Consulting
GmbH   Stadtweg 7   D-30966 Hemmingen, Germany   Attn: Matthias Mueller, CEO

 

 

 

 

13.7       Entire Agreement; Amendments. This Agreement, including any Exhibits
and Schedules hereto, sets forth the entire agreement and understanding of the
Parties with respect to its subject matter. All prior and contemporaneous
agreements and understandings between the Parties, whether oral or written, are
hereby superseded in their entirety by this Agreement. This Agreement may be
amended, modified, or supplemented only by a written instrument duly executed by
each of the Parties.

 

13.8       No Waivers. The failure of either Party to assert a right hereunder
or to insist upon compliance with any term or condition herein will not
constitute a waiver of that right or excuse any subsequent nonperformance of any
such term or condition, or of any other term or condition, by the other Party.

 

13.9       Severability. If any provision of this Agreement is held invalid,
illegal, or unenforceable, such provision shall be modified to reflect the
fullest legal and enforceable expression of the intent of the Parties or, if not
possible, severed, and the remainder of this Agreement will not be affected
thereby. Notwithstanding the foregoing, the limitations of liability in Article
11 and the indemnification provisions in Article 12 are considered by the
Parties to be integral to this Agreement and may not be modified or severed from
this Agreement.

 

13.10       Interpretation. The Section, Article, and Exhibit headings contained
in this Agreement are for reference purposes only, and shall not control or
affect the construction of this Agreement or the Interpretation thereof in any
respect. Unless otherwise expressly indicated, all references to Sections,
Articles, and Exhibits are to the Sections, Articles, Exhibits and Schedules of
this Agreement.

  

13.11       Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be binding as of the Effective Date, and all
of which shall constitute one and the same instrument. Each such copy shall be
deemed an original, and it shall not be necessary in making proof of his
Agreement to produce or account for more than one such counterpart. Facsimile or
electronically scanned copies will be given the same force and effect as
original documents.

 

[Signature Page Follows]

 

 

 

 

 

IN WITNESS WHEREOF, the Parties, by their duly appointed officers, have entered
into this Agreement on the Effective Date.

 

  MAGNEGAS CORPORATION                     By: /s/ Ermanno Santilli     Name:  
Ermanno Santilli     Title: President and CEO     Date: October 16th, 2017      
           

 

  TALON VENTURES & CONSULTING GMBH                     By: /s/ Matthias Mueller
    Name:   Matthias Mueller     Title: Chief Executive Officer     Date:
October 16th, 2017  

 

 

 

 

  

EXHIBIT A 

Description of Gasifier

 

 

 

 

 

 

 

 

 

  

EXHIBIT B 

Site Specifications

 

  

 

 

 

  

 

 

 

 

EXHIBIT C 

MagneGas System Operational Completion Standard

  

The following must be completed before the Second MagneGas System will be deemed
completed for operational purposes: