Exhibit 10.18
TECHNOLOGY LICENSE AND JOINT DEVELOPMENT AGREEMENT
This Technology License and Joint Development Agreement is made among Biomass
North American Licensing, Inc. (herein called “BNAL”), Biomass North America,
LLC (“Biomass North America”) and Anthony P. Noll (herein called “Noll” and
collectively with Biomass North America, the “Licensors”), effective the  _____ 
day of July, 2008 (the “Effective Date”). The parties include any affiliate of a
party; an “affiliate” is defined as the parent company of a party and any
company that is controlled directly or indirectly by that party or its parent
company through more than fifty percent (50%) ownership, provided such affiliate
agrees to be bound by this agreement.
WHEREAS, Noll has filed those certain patent applications identified as United
States Patent Application Serial Nos. 11/296,585 (Atty. Docket No. NOLT103),
11/296,586 (Atty. Docket No. NOLT102), and 10/713,557 (now abandoned) (Atty.
Docket No. NOLT101) copies of which are attached hereto as Exhibit A (the “Noll
Patents”) for the use of a pressurized steam vessel operating under lower
temperature and pressure conditions as described in the Noll Patents and the
Biomass Patent (as defined herein) (the “Technology”) to separate and clean
municipal solid waste where the cellulosic material derived from the process is
used to produce ethanol and other bio-fuels.
WHEREAS, Noll has filed that certain patent application identified as United
States Patent Application Serial No. 11/355,632 (Atty. Docket No. NOLT104), a
copy of which is attached hereto as Exhibit B, and subsequently licensed such
patent to Biomass North America, LLC. (the “Biomass Patent” and together with
the Noll Patents, the “Technology Patents”) to use the Technology for a broad
range of uses including the production of energy products; and
WHEREAS, BNAL desires to obtain an exclusive license to use the Technology in
North America.
NOW THEREFORE, in consideration of the premises and of the mutual covenants and
agreements contained hereinafter, the parties agree as follows:

1.
LICENSE TO PRODUCE ETHANOL AND OTHER BIOFUELS.

  (a)  
Licensors hereby grant to BNAL an exclusive license in North America (as defined
herein) to use the Technology as described in the Technology Patents and any
modifications, extensions or improvements to the Technology Patents subject to
the further conditions set forth in this Agreement. “North America” shall
include the United States and Canada. No other person, including the Licensors,
shall be entitled to use the Technology for the purposes licensed to BNAL
hereunder in North America during the term of this Agreement. The License shall
include all know-how, data, designs, and other information developed by
Licensors in connection with the Technology, now existing or developed at any
time during this Agreement.

 

 

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  (b)  
Consideration: In consideration therefore, upon signing this agreement BNAL
shall pay Licensors $1.00 U.S.
    (c)  
Royalty: In addition to the above consideration, BNAL shall pay Licensors a
Royalty equal to $1.00 for each dry ton of biomass produced using the Technology
where the biomass is used for the production of energy products. BNAL shall not
be required to pay a royalty if the biomass produced using the Technology is
used for research or testing purposes. Within thirty days prior to the first use
of the Technology by BNAL whereby a royalty shall be generated, BNAL and
Licensors shall agree in writing as to a commercially reasonable method for
determining the amount of biomass derived using the Technology; provided that if
at such time the parties have not made such determination, either party may
submit the matter to arbitration in accordance with Paragraph 16 of this
Agreement and the determination of the arbitrator in such matter shall be final
and binding on all parties hereto. BNAL shall retain all records relating to the
use of the Technology for the production of biomass for a period of three years.
Licensors shall be entitled to inspect such records at BNAL’s offices during
regular office hours at any time during the term of this Agreement after five
days written notice. If Licensors’ examination reveals a discrepancy of ten
percent or more on any payments owed Licensors hereunder and such amount is
agreed by the parties to be correct or ultimately determined to be correct by
other means, BNAL shall be required to pay Licensors the costs of any
examination or proceedings necessary to discover and collect such discrepancy.
       
The Royalty payable hereunder shall be payable quarterly (based on calendar
quarters) and shall be due and owing within thirty days after the end of each
such quarter during the term of this Agreement. The amount due hereunder may be
paid in cash or stock, which shall be determined by Licensors in their sole
discretion. If Licensors desire to be paid in cash, Licensors shall so notify
BNAL in writing at least ten days prior to the end of the quarter in which
payment is due. If no such notice is received, payment shall be in the form of
Common Stock, $0.001 par value per share of BNAL, provided that at such time
such Common Stock is publicly tradable on a recognized exchange, quotation
system or over the counter market. The value of such stock for determining the
amount due Licensors shall be the price obtained by the average daily closing
price for shares of such stock on the five days preceding the end of the
applicable quarter for which payment is due. If on the last day of the quarter
for which any payment hereunder is due, BNAL’s Common Stock is not publicly
tradable on a recognized exchange, quotation system or over the counter market,
BNAL shall be required to make payment for that quarter in cash.

 

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  (d)  
Enhancements. Each party shall own any and all improvements to the Technology
made at its expense and costs, however, each party agrees to license to the
other party any enhancements it makes to the Technology. (Such enhancements
created by Licensors shall be subject to the terms of this Agreement.) Such
enhancements shall be delivered promptly upon their development.
    (e)  
Term and Termination. This Agreement shall be for the later of a term of twenty
one years from the date hereof or the date of expiration of the Technology
Patents, including any extensions, modifications or amendments thereto, unless
terminated sooner by a party. Either BNAL or Licensors, as the case may be, may
terminate this Agreement upon breach by the other party of any covenant or
representation or warranty in this Agreement by providing sixty days notice if
the breaching party fails to cure such breach in the sixty day period after
notice. Licensors may terminate this agreement in the event of the insolvency,
bankruptcy, or dissolution of BNAL; BNAL’s failure or inability to commence
construction of the Commercial Development within 2 years from the date hereof;
or BNAL’s abandonment of any reasonable efforts to exploit the Technology.

2. JOINT DEVELOPMENT. Prior to the date of this Agreement, Noll and/or Biomass
North America commenced discussions with Duke Energy, Inc. relating to a project
whereby the Technology would be used to generate combustible biomass for the
production of electricity on a commercial scale (the “Commercial Development”).
To date no site has been selected for the Commercial Development, however a site
owned and operated by an affiliate of Biomass North America located in Chicago,
Illinois at                      (the “Proposed Site”) is currently being
considered as the location for such. Licensors agree to provide BNAL with any
and all contacts, data, correspondence or other information relating to the
Commercial Development and work together with BNAL to complete the Commercial
Development consistent with the terms of this Agreement.
3. ENGINEERING SUPPORT/DEVELOPMENT PROCESS/EXTENSIONS. The parties acknowledge
and understand that the commercialization of the Technology is risky and they
will encounter unforeseen obstacles. The description of the projected
development of the Technology in this Agreement is based on BNAL’s current
engineering plans. If at any time, BNAL is in good faith working to meet its
obligations hereunder, but is unable to do so because of delays in engineering,
permitting, obtaining governmental approvals, construction or financing, and at
such time is using commercially reasonable efforts to resolve such issues, then
BNAL may extend its time for complying with its obligation to commence the
Commercial Development and release from the escrow the 4,000,000 shares by an
additional 180 days by issuing to Licensors an additional 100,000 shares of BNAL
Common Stock, provided BNAL may do so only once during the term of this
Agreement.

 

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In order to complete the development of the Technology, Noll will be required to
provide engineering support to BNAL, for the Technology, including meeting with
BNAL’s engineers, traveling to Golden, Colorado to assist BNAL in producing
biomass, providing any and all current or future test results, engineering data,
designs, chemical analyses and other information relating to the Technology
requested by BNAL or its engineers. Upon execution of this Agreement, Noll shall
provide any such information in his possession to BNAL. BNAL will pay the
reasonable costs associated therewith, including the travel, meals and lodging.
In addition, to further assist in the foregoing, upon obtaining the financing
necessary to construct the Commercial Development, Noll shall become a
Consultant of BNAL for the remainder of the term of this Agreement subject to
BNAL’s payment of compensation acceptable to Noll. Noll and the BNAL shall enter
into a Consulting Agreement, satisfactory to both parties, whereby Noll will be
required to devote his full time consulting efforts to advise BNAL on the
construction and operation of the Commercial Development and any future
construction and operation of plants undertaken by BNAL and BNAL shall pay Noll
compensation for such services acceptable to Noll.
4. EXCLUSIVITY. Licensors agree that during the term of this Agreement,
Licensors will not grant to any third party any licenses to use the Technology,
or any portion thereof anywhere in North America; provided that if BNAL shall
fail to commence construction of the Commercial Development or otherwise cause
the shares held in escrow for Licensors to be released within eighteen months
(subject to the 180 day extension for performance as set forth in paragraph 3
above), then the license granted hereunder shall become non-exclusive, provided
all other terms shall continue to apply. Notwithstanding anything in this
Agreement to the contrary, the parties agree that Biomass North America shall
have an exclusive right of first refusal to provide waste hauling and plant
management services to CBT for any project using the Technology that is
initiated within 100 miles from the City of Chicago, Illinois (the “Reserved
Operating Area”), provided such services are offered to CBT on commercially
reasonable terms. CBT shall be required to notify Biomass North America in
writing at least thirty days prior to the time that it intends to solicit any
request or enter into any contract for waste hauling or plant management
services in the Reserved Operating Area. If within the thirty days following
such notice, Biomass North America indicates in writing that it is capable and
desires to perform all or part of such services and submits a written agreement
to do so at commercially reasonable rates and on commercially reasonable terms
given the then-existing market conditions in Chicago, Illinois, CBT shall be
required to accept such agreements, provided that Biomass North America performs
the services set forth therein in accordance with the terms of such agreements.
5. WARRANTIES . Except as set forth on Schedule 5 hereto, Licensors own all
rights in and to the Technology for the purposes set forth in this Agreement,
free of any liens, claims, encumbrances or other restrictions that would impair
BNAL’s rights under this Agreement. To the best of Licensors’ knowledge, the
Technology does not infringe the intellectual property rights of any third
party. Licensors represent and warrant that as of the effective date of this
Agreement they have received no notice that the Technology infringes any patent,
copyright, trade secret or other intellectual property right (collectively
“Intellectual Property Rights”) of any third party. Licensors have full power
and authority to grant BNAL the license set forth herein and has obtained the
consent of any and all parties required to enter into this Agreement. Licensors
will immediately advise BNAL of any such notice received in the future as it
applies to Technology.

 

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6. PATENT PROSECUTION. Licensors shall be responsible for all costs associated
with pursuing the Technology Patents or prosecuting any parties infringing on
the Technology. Licensor shall provide BNAL copies of all correspondence from
and to the United Sates Patent Office, or any other correspondence relating to
the Technology Patents, to BNAL within three business days of receipt by
Licensors. Licensors shall use all commercially reasonable efforts to obtain a
grant of the patent set forth in the Technology Patents from the United States
Patent and Trademark Office. If Licensors fail to diligently prosecute the
Technology Patents or to prevent infringement on the Technology Patents, BNAL
may do so at its cost and expense after providing Licensors thirty days written
notice of its intent to do so and failure of Licensors to comply with its
obligations under this Section. If BNAL incurs expenses prosecuting or
protecting the Technology Patents after such notice, such expenses shall be
deducted from future payments due Licensors hereunder in an amount equal to the
expenses incurred by BNAL.
7. CONFIDENTIAL INFORMATION. The parties will keep confidential any information
provided to it by the other party that is proprietary to the other party and
marked confidential; provided such information shall not be considered
proprietary once it is in the public domain by no fault of the other party. Such
confidentiality will be maintained by the other party with the same care that
such party would use for its own confidential information, but
in any event with reasonable care.
8. COMPLETE AGREEMENT. This is a complete agreement binding upon the parties,
their heirs, successors and assigns. It may only be modified in writing signed
by officers of both parties. The execution of this Agreement shall not
invalidate or make void that certain Confidentiality Agreement between the
parties dated as of                     , which shall stay in effect and apply
to the parties during the term of this Agreement.
9. GOVERNING LAW. This Agreement shall be governed by the laws of the State of
Missouri, excluding its choice-of-law provisions.
10. PUBLIC STATEMENTS. The parties agree immediately to publish a joint press
release stating that Licensee has licensed the Technology. Further, either party
is free to file with the SEC any document required to be filed there on advice
of counsel (redacted in a form advised by counsel). Other public statements and
press releases related to this licensing agreement are subject to approval in
advance by both parties; neither party shall use the name of the other party
without advance approval.
11. INDEPENDENT CONTRACTORS. The parties are independent contractors, and
nothing herein shall be deemed to create any agency, joint venture or
partnership relationship between them. Neither party shall have the right to
bind the other to any obligation, nor have the right to incur any liability on
behalf of the other.
12. FORCE MAJEURE. Neither party shall be liable to the other for delay or
failure to perform if and to the extent such delay or failure to perform is due
to causes beyond the reasonable control of the party affected within the two
year limit on the commencement of construction of the Commercial Development.

 

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13. ASSIGNMENT. Neither party shall assign this Agreement or its rights
hereunder without the prior written consent of the other party, except to an
affiliate of that party, which consent shall not be unreasonably withheld,
conditioned or delayed, except that if BNAL desires to assign this agreement to
an entity purchasing substantially all of its assets and the business of BNAL
will continue to operate after such acquisition, BNAL shall be entitled to
assign its rights under this Agreement without the consent of Licensors, if at
the time of such acquisition all shares issuable to Licensors hereunder have
been released to Licensors from escrow.
14. NON-WAIVER. No course of dealing or failure of either party to enforce
strictly any term, right, obligation or provision of this Agreement shall be
construed as a waiver of such provision.
15. SEVERABILITY. If any provision of this Agreement shall be held invalid or
unenforceable, such provision shall be deemed deleted from the Agreement and
replaced by a valid and enforceable provision that achieves, as much as
possible, the same purpose, and the remaining provisions of the Agreement shall
continue in full force and effect.
16. ARBITRATION. ANY DISPUTES ARISING UNDER THIS AGREEMENT SHALL BE SUBJECT TO
ARBITRATION CONDUCTED PURSUANT TO THE RULES OF THE AMERICAN ARBITRATION
ASSOCIATION. ANY SUCH ARBITRATION SHALL BE HELD IN ST. LOUIS, MISSOURI. THE
PARTIES HERETO SUBMIT TO EXCLUSIVE JURISDICTION IN ST. LOUIS, MISSOURI. THE
DECISION OF THE ARBITRATODR SHALL BE FINAL AND SHALL BE ENFORCEABLE IN ANY COURT
HAVING JURISDICTION OVER THE PARTY AGAINST WHOM ENFORCEMENT IS SOUGHT.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
written above.
THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION ENFORCEABLE AGAINST THE
PARTIES.

                    BIOMASS NORTH AMERICA LICENSING, INC.       BIOMASS NORTH
AMERICA, LLC  
 
                 
By:
          By:                      
 
  Anthony Noll, President           Brian Boomsma — Manager  
 
                 
 
          By:                          
 
  Anthony P. Noll — individually           Anthony P. Noll — Manager  

Version.8.6.08

 

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EXHIBIT A — NOLL PATENTS

 

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EXHIBIT B — BIOMASS PATENT

 

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Warranty Exceptions
The following information is based on the information and belief of Anthony Pius
Noll and is true and accurate to the best of his present knowledge, information
and belief:

1.  
On 11 November 2005 Anthony P. Noll granted Dutch Energy, Inc. exclusive rights
for all of North America for “Future Licensed Patents” (as amended by the First
Amendment to Agreement to License Future Patents dated 1 September 2006).

2.  
United States Patent Application Serial No. 11/296,585 entitled “BIOMASS ENERGY
PRODUCT AND PROCESSING METHOD” was filed on 6 December 2005, naming Herbert A.
Ligon and Anthony P. Noll as inventors.

3.  
United States Patent Application Serial No. 11/296,586 entitled “SOIL AMENDMENT
PRODUCT AND METHOD OF PROCESSING” was filed on 6 December 2006 naming Herbert A.
Ligon and Anthony P. Noll as inventors.

4.  
Both of the foregoing Application Nos. 11/296,585 and 11/296,586 were filed as
continuation-in-part patent applications from a parent case which was United
States Patent Application Serial No. 10/713,557, published 4 August 2005 under
US2005/0166812 entitled “MSW PROCESSING VESSEL” naming as inventors Tony Noll,
Herb Ligon and Scott Hicks. That application is now abandoned.

5.  
United States Patent Application Serial No. 10/713,557 was assigned to Horizon
Fuel and Financial Management, LLLP, together with any continuation-in-part
patent applications based thereon.

6.  
A partial one-third (1/3) right, title and interest to each of the foregoing
Application Serial Nos. 10/713,557; 11/296,585 and 11/296,686 was assigned by
Horizon Fuel and Financial Management LLLP on 26 April 2007 to Anthony P. Noll,
together with the right to file, prosecute, enforce and maintain any and all of
said applications. This Assignment was forwarded electronically for recording in
the U.S. Patent and Trademark Office on 18 May 2007 and was recorded on that
date.

7.  
United States Patent Application Serial No. 11/355,632 entitled “ANGLED REACTION
VESSEL”, was filed on 15 February 2006 naming Anthony P. Noll as inventor. That
application has not been assigned to anyone by Anthony P. Noll.

8.  
On 23 October 2006, Anthony P. Noll granted an exclusive license under United
States Patent Application Serial No. 11/355,632 to BioMass Worldwide Ltd.

9.  
On or about 1 September 2006, BioMass Worldwide Ltd. and Dutch Energy, Inc.
granted to BioMass USA an exclusive license under United States Patent
Application Serial No. 11/355,632 for the United States and Canada.

 

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10.  
On 5 June 2008, Dutch Energy terminated the license of United States Patent
Application Serial No. 11/355,632 for the United States and Canada to BioMass
USA.

11.  
[On [        ] 2008 Noll terminated the license of United States Patent
Application Serial No. 11/355,632 for the United States and Canada to BioMass
USA.]

12.  
Except as to Dutch Energy, Inc. Anthony P. Noll has not granted any assignment
or license of any rights he holds in said United States Patent Application
Serial Nos. 10/713,557 (now abandoned); 11/296,585, nor 11,296,586.
  13.  
[On [        ] 2008, Dutch Energy, Inc terminated the license detailed at point
1 above.]

14.  
On 9 June 2008, Anthony P. Noll granted an exclusive license for North America
and Canada of United States Patent Application Serial Nos. 11/355,632,
10/713,557 (now abandoned); 11/296,585, and 11,296,586 to Biomass North America,
LLC.
  15.  
On [        ] 2008 Biomass North America, LLC granted exclusive license of
United States Patent Application Serial Nos. 11/355,632, 10/713,557 (now
abandoned); 11/296,585, and 11,296,586 to Biomass North America Licensing, Inc.
  16.  
On [        ] 2008, Anthony P. Noll and Biomass North America, LLC entered into
a deed of termination to terminate the license listed at point 14 above.

 

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