Exhibit 10.5
 

CONTRIBUTION AND ASSIGNMENT AGREEMENT

This Contribution and Assignment Agreement (the “Agreement”) between R. Patrick
Garrett, an individual (“Garrett”) and Mary Anne Garrett, and individual and the
sole proprietor of R&M (“R&M” and, together with Garrett, the “Contributors”),
on the one hand, and Gallery Management Holding Corp, a Colorado corporation
(the “Company”), on the other hand, is made as of February 27, 2012, with
respect to the contribution of assets and intellectual property to the Company
in exchange in accordance with the following terms and conditions:

RECITALS:

WHEREAS, the Company desires to enter into the waste remediation business,
particularly waste generated in connection with oil and gas production (the
“Business”);

WHEREAS, the Contributors have developed and have ownership interests in
technology relating to waste remediation;

WHEREAS, the Contributors have also identified prospective customers of the
Business and have negotiated contracts or head of terms agreements with
prospective customers of the Business and strategic alliances of the Business
(the “Contracts”); 

WHEREAS, the Contributors desire to contribute to contribute the Contracts and
their interests in the intellectual property necessary to conduct the Business
in exchange for the consideration set forth below.

NOW THEREFORE, the Contributors and the Company agree as follows:

1. CONTRIBUTED PROPERTY

Effective immediately, the Contributors hereby contributes and conveys to the
Company all of the Contributors' right, title, and interest in the following
(collectively, the “Assets”), more specifically described on Exhibit A hereto:

a. Intellectual Property.  The Contributors shall contribute and caused to be
assigned to the Company all intellectual property rights relating to or used in
the Business, including but not limited to all patents and patent applications,
trademarks, tradenames, service marks, know-how, trade secrets, copyrights,
inventions, licenses and other rights to make, use or sell the products to be
offered by the Business.  Exhibit A sets forth all intellectual property used in
the Business and contributed to the Company.

b. Contracts - all contracts and agreements (oral or written) in effect on the
as of the date hereof pertaining to the Business, including, without limitation
the agreements. Understandings or arrangements listed on Exhibit A.

 
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c. No Prior Liabilities.  Except as set forth herein, the Assets do not include,
and the Company is not accepting, assuming or agreeing to pay any liability,
debt or obligation of the Contributors arising prior to the date of this
Agreement relating to or arising from the ownership or use of the Assets.
Notwithstanding the foregoing, to the extent that any payments, debts or
obligations arise with respect to the Assets from and after the date hereof,
such payments shall be the obligation of the Company.

2. COMPANY ACCEPTANCE AND ASSUMPTION

The Company hereby accepts the contribution of the Assets and agrees to make the
following payments as consideration for the contribution of the Assets:

a.  
Cash payments totaling Six Hundred Thousand Dollars ($600,000) payable as
follows:

i.  
$100,000 on or before March 26, 2012;

ii.  
$250,000 on or before December 31, 2012; and

iii.  
$250,000 on or before December 31, 2013.

iv.  
The Company shall execute and deliver an unsecured promissory note in the
principal amount of $600,000 substantially in the form attached hereto as
Exhibit C.

b.  
The Company agrees to accept and assume all obligations arising from and
relating to the operation of the Business and the Assets from and after the date
hereof, including but not limited to all payments due or owing under any
Contract included in the Assets and incurred after the date hereof.

c.  
The Company agrees to enter into that certain Employment Agreement of even date
herewith with R. Patrick Garrett pursuant to which the Contributor will be
appointed as the Chief Executive Officer and receive the salary and stock and
options set fort therein.

The parties acknowledge and agree that each of the payments and commitment above
are a material part of the Consideration for the Assets.  If the Company
breaches any of its obligations above within one year after the date of this
Agreement or in the event that the Company becomes insolvent, declares
bankruptcy, makes any assignment for the benefit of creditors or upon the
occurrence of any similar event, then the Contributor shall be entitled to
terminate this Agreement and obtain the return of the Assets, free and clear of
any lien or encumbrance.

 
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3. REPRESENTATIONS AND WARRANTIES OF PRICE

a. Organization.  Garrett is an individual, residing in the State of Oregon and
Mary Anne Garrett is an individual, residing in the State of Oregon, and is the
sole proprietor of R&M, and each has the power and authority to own, transfer
and convey the Assets and to carry on business as presently being conducted.

b. Authority.  The Contributors have full legal right, power and capacity to
enter into, execute, deliver and perform this Agreement and all attendant
documents and instruments (collectively “Documents”)  contemplated hereby which
Documents shall include but not be limited to the execution of bills of sale,
assignments of all intellectual property relating to the Business.   Further,
the execution and delivery by the Contributors of the actions required hereunder
and the consummation by them of the transactions contemplated thereby and the
performance by them of their obligations therein have been duly and validly
authorized by all necessary action.

c. Enforceability.  This Agreement has been duly executed and delivered and
constitutes the legal, valid and binding obligation of each of the Contributors
and is enforceable with respect to each of the Contributors in accordance with
its terms, except as enforcement may be limited by bankruptcy, insolvency,
priority or other laws or court decisions relating to or affecting generally the
enforcement of creditors’ rights or affecting generally the availability of
equitable remedies.  The execution and delivery of this Agreement by the
Contributors and the Company, and the consummation of the transactions
contemplated hereby by the Contributors in accordance with the terms hereof
shall not conflict with or result in a breach of, violation of, or default
under, (or constitute an event that with notice, lapse of time, or both, would
constitute a breach or default under) any of the terms, conditions or provisions
of laws of Oregon  or the United States of America, or any note, bond, mortgage,
indenture, license, lease, credit agreement or other agreement, document,
instrument or obligation to which any of the Contributors is a party or by which
any of the Assets are bound.

d. No Violation. The execution and consummation of this Agreement will not (i)
violate or conflict with any law, statute, ordinance, rule, regulation, decree,
writ, injunction, judgment or order of any governmental authority or of any
arbitration award which is either applicable to, binding upon or enforceable
against any of the Contributors, or the assets of the Contributors, (ii)
conflict with, result in any breach of, or constitute a default (or an event
which would, with the passage of time or the giving of notice or both,
constitute a default) under, or give rise to a right to terminate, amend,
modify, abandon or accelerate, any contract which is applicable to, binding upon
or enforceable against any of the Contributors relating to the Business or the
Assets, (iii) result in or require the creation or imposition of any lien or
encumbrance upon or with respect to any of the Assets, or (iv) require the
consent, approval, authorization or permit of, or filing with or notification
to, any governmental authority, any court or tribunal or any other person.

 
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e. Good Title, Adequacy and Condition.

i. The Contributors has good and marketable title to the Assets with full power
to sell, transfer and assign the same, free and clear of any lien or encumbrance
of any kind.

ii. The Assets constitute, in the aggregate, all of the assets and properties
necessary for the conduct of the Business in the manner in which and to the
extent to which such business is currently being conducted and include, without
limitation, all tangible and intangible assets owned by the Contributors, and
all contracts, licenses and permits of the Contributors related to the Business.

f. No Claims. There is no action, suit or proceeding against the Contributors or
the Assets, nor is there any pending or threatened action of any kind against
the Contributors or the Assets, except as set forth on Exhibit B.

4. CONDITIONS TO CLOSING

a.  
Settlement of Litigation.  The closing of the contribution of the Assets shall
occur within five (5) business days after the Contributors have entered into a
settlement agreement or agreement to stay execution of judgment in David Orkeny
and Buckingham Investment Group, LLC v. Keith  Chapman, Ronald Patrick Garrett
and Allen Adams (case no.0809-12896) in the Circuit Court of the State of Oregon
for the County of Multnomah.  Such settlement or agreement to stay shall be on
terms reasonably acceptable to the Company.

b.  
Assignment of Payments.  In the event that such settlement or agreement to stay
requires a settlement payment by any of the Contributors, then the Company shall
be entitled to pay such amounts directly to the plaintiffs or their counsel and
to offset any such payments against amounts due under this Agreement; provided,
however, in no event or circumstance shall the Company be required to make any
payment in excess of the amount agreed in Section 2 above or to make any payment
in advance of the due dates set forth in Section 2.

 
 
5. REPRESENTATIONS AND WARRANTIES OF PETROTERRA

a. Organization.  The Company is a corporation validly existing under the laws
of the State of Colorado and has the requisite power and authority to carry on
the Business as now being conducted.

 
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b. Authority.  The Company has full legal right, power and capacity to enter
into, execute, deliver and perform this Agreement and all attendant documents
and instruments contemplated hereby.

c. Enforceability.  This Agreement has been duly executed and delivered and
constitutes the legal, valid and binding obligation of the Company and is
enforceable with respect to the Company in accordance with its terms, except as
enforcement may be limited by bankruptcy, insolvency, priority or other laws or
court decisions relating to or affecting generally the enforcement of creditors’
rights or affecting generally the availability of equitable remedies.  The
execution and delivery of this Agreement by the Contributors and the Company,
and the consummation of the transactions contemplated hereby by the Company in
accordance with the terms hereof shall not conflict with or result in a breach
of, violation of, or default under, (or constitute an event that with notice,
lapse of time, or both, would constitute a breach or default under) any of the
terms, conditions or provisions of the charter documents of the Company, any
provision of the laws of Oregon or the United States of America, or any note,
bond, mortgage, indenture, license, lease, credit agreement or other agreement,
document, instrument or obligation to which the Company is a party or by which
any of its assets or properties are bound.

6.  VALUATION

The Contributors and the Company agree that the fair market value of the Assets,
taken as a whole, is in excess of $600,000 as of the date hereof.

7. INDEMNIFICATION

a. Agreement by the Contributors to Indemnify. The Contributors agrees to
indemnify, defend,  and hold the Company and the officers, managers, directors,
employees and agents of each thereof (collectively, the “Indemnified Party”)
harmless from and against the aggregate of all expenses, losses, costs,
deficiencies, liabilities and damages (including, without limitation, related
counsel fees and expenses) incurred or suffered by the Indemnified
Party  resulting from or arising out of (i) any breach of a representation or
warranty made by the Contributors in or pursuant to this Agreement, (ii) any
breach of the covenants, agreements, or any terms by the Contributors under this
Agreement, (ii) any infringement of the proprietary rights of any third party,
or (iv) any liabilities or obligations of the Contributors.

b. Survival of Representations and Warranties. Each of the representations and
warranties made by the Contributors in this Agreement or pursuant hereto shall
survive for a period of two (2) years from the date of this Agreement.

 
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8. GENERAL

a. Notices.  Any notice, request, instruction or other document to be given
hereunder by any party to the other shall be in writing and delivered personally
or sent by certified mail, postage prepaid, by telecopy (with receipt
confirmed), or by courier service, as follows:
 
 
If to the Company to:
Gallery Management Holding Corp.
 
c/o Allen Adams
 
4 Grouse Terrace
 
Lake Oswego, Oregon 97035
   
with a copy to:
Christopher A. Wilson.
 
9110 Irvine Center Drive
 
Irvine, CA 92618
   
If to a Contributor:
c/o R. Patrick Garrett
 
39380 Amherst Street
 
Sandy, Oregon 97055

b. Headings.  The headings of the several sections of this Agreement are
inserted for convenience of reference only and are not intended to affect the
meaning or interpretation of this Agreement.

c. Counterparts.  This Agreement may be executed in counterparts, and when so
executed each counterpart shall be deemed to be an original, and said
counterparts together shall constitute one and the same instrument.

d. Binding Nature.  This Agreement shall be binding upon and inure to the
benefit of the parties hereto.  No party may assign or transfer any rights under
this Agreement; provided, however, the Company may assign this Agreement to any
successor in interest, and entity into which it merges, or any entity that
acquires substantially all of the assets of the Company.

e.  Applicable Law.  This Agreement shall be governed by, construed and enforced
in accordance with the laws of the State of Oregon as applied to contracts
entered into solely between residents of, and to be performed entirely in, such
state.

 
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IN WITNESS WHEREOF, the parties have executed this Contribution and Assignment
Agreement as of the date above written.

GALLERY MANAGEMENT HOLDING CORP.,
A Colorado corporation

By:            /s/ Roger Richter
Roger Richter, COO

R. PATRICK GARRETT, an individual

 
 
/s/ R. Patrick Garrett
R. Patrick Garrett

MARY ANNE GARRETT, sole proprietor of R&M

/s/ Mary Anne Garrett
Mary Anne Garrett

 
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EXHIBIT A

List of Assets

Contracts

1.  Colombia—all contracts with Oilfield Services and Supplies, SAS, ATP,
EcoPetrol and related parties

2. Teaming agreements with Remedial Construction Services, L.P, including
agreements for the Motiva refinery

3. The Bakken – all contracts with

4. Kazakhstan – the right to negotiate contracts with Steelmaster and

5. Acquisition of OSS/ATP

6. Acquisition of Thunderridge –

7. Agreement with AquaTech

8. Manufacturing Agreement with Chapman Industries

Intellectual Property

1.  
 All proprietary rights relating to the infrared unit technology.

2.  
All proprietary rights relating to indirect thermal unit technology.

3.  
All proprietary rights relating to the clean-up of oil ponds.

4.  
All proprietary rights relating to the remediation of produced and production
water.

A-1

 
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EXHIBIT B

Pending and Threatened Proceedings

1.  
  Orkeny v. Chapman described in the Agreement.

2.  
Base Industries, LLC v. MECO Environmental, LLC et al., (case no 602755) in the
19th Judicial District Court for the Parish of East Baton Rouge, State of
Louisiana.

B-1

 
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EXHIBIT C

Form of Promissory Note and Security Agreement
 
 
 
 
 
 
 
 
 
C-1
 

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