Exhibit 10.4

SUBSTITUTE MEMBERSHIP AGREEMENT

SUBSTITUTE MEMBERSHIP AGREEMENT, dated as of December 19, 2008 (the
“Agreement”), between PetroTech Holdings Corp. (the “Assignor”) and PetroAlgae
Inc. (the “Assignee”).

WHEREAS, certain Persons have entered into an Amended and Restated Limited
Liability Company Agreement of PetroAlgae, LLC (the “LLC”) (as such Agreement
may be amended, modified or supplemented from time to time in accordance with
the terms thereof, the “LLC Agreement”), dated as of February 16, 2007 (terms
used and not otherwise defined herein are used as defined in the LLC Agreement);

WHEREAS, pursuant to a Consent Agreement, dated as of August 14, 2008, the
Assignor was admitted as a Member of the LLC;

WHEREAS, the Assignor has agreed to irrevocably and unconditionally assign its
membership and related Units in the LLC to the Assignee;

WHEREAS, Assignor is the controlling shareholder of Assignee, and Assignee is an
Affiliate of Assignor;

WHEREAS, Assignor has agreed to assign its membership and related Units in the
LLC to a Permitted Transferee; and

WHEREAS, the assignment by Assignor, together with the transfers by certain
holders of Class B Units of the LLC of such Class B Units to the Assignee in
exchange for common stock of the Assignee, is intended to constitute a
transaction described in Section 351 of the Internal Revenue Code of 1986, as
amended; and

WHEREAS, in accordance with the LLC Agreement, upon execution and delivery of
this Agreement to the LLC, the Assignee shall become a Member of the LLC
entitled to exercise or receive any of the rights, powers or benefits of a
Member.

NOW, THEREFORE, the parties hereto agree as follows:

SECTION 1. The Assignment. Notwithstanding any provision in the LLC Agreement to
the contrary, the Assignor hereby irrevocably and unconditionally assigns,
transfers and conveys to the Assignee all of the Assignor’s rights, powers and
benefits as a Member of the LLC and all of the Assignor’s rights and Units in
the LLC. The Assignee hereby agrees to become a Member of the LLC in the place
and stead of the Assignor and, in accordance with Section 7.2(b) of the LLC
Agreement, Assignee hereby assumes all obligations of Assignor set forth in the
LLC Agreement and, in accordance with Section 7.3(a) of the LLC Agreement,
Assignee hereby expressly adopts the provisions of the LLC Agreement.

SECTION 2. Admission. Notwithstanding any provision in the LLC Agreement to the
contrary, contemporaneously with the assignment described in Section 1 of this
Agreement, the Assignee shall be deemed admitted as a Member of the LLC.

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SECTION 3. Withdrawal. Notwithstanding any provision in the LLC Agreement to the
contrary, immediately following the admission of the Assignee as a Member of the
LLC, the Assignor shall and does hereby withdraw from the LLC as a Member of the
LLC, and thereupon shall cease to be a Member of the LLC, and shall thereupon
cease to have or exercise any rights or powers of a Member of the LLC .

SECTION 4. Continuation of the LLC. The parties hereto agree that the assignment
of the Units by the Assignor, the admission of the Assignee as a Member of the
LLC and the withdrawal of the Assignor as a Member of the LLC shall not dissolve
the LLC and the business of the LLC shall continue without dissolution.

SECTION 5. Books and Records; Certificates; Acknowledgment of Transfer. The
Board shall take all necessary action under the Delaware Limited Liability
Company Act and the LLC Agreement to evidence the withdrawal of the Assignor
from the LLC as a Member of the LLC and the admission of the Assignee to the LLC
as a Member of the LLC. The Board further acknowledges that the transfer of
Units in accordance with the terms of this Agreement is in full compliance with
the requirements of Article VII of the LLC Agreement.

SECTION 6. Future Cooperation. Each of the parties hereto agrees to cooperate at
all times from and after the date hereof with respect to all of the matters
described herein, and to execute such further assignments, releases,
assumptions, amendments of the LLC Agreement, notifications and other documents
as may be reasonably requested for the purpose of giving effect to, or
evidencing or giving notice of, the transactions contemplated by this Agreement.

SECTION 7. LLC Agreement in Effect. Except as hereby amended, the LLC Agreement
shall remain in full force and effect.

SECTION 8. Obligations of the Assignee. The Assignee, as a Member, agrees (i) to
be bound by all of the terms and conditions of the LLC Agreement, and (ii) to
assume all of Assignor’s obligations under the LLC Agreement.

SECTION 9. Representations and Warranties.

(a) The Assignor represents and warrants as follows:

(i) This Agreement is the legal, valid and binding obligation of the Assignor
enforceable against the Assignor in accordance with its terms.

(ii) The Assignor is the legal and beneficial owner of the Units being assigned
by it hereunder and such Units are free and clear of any adverse claims or
liens.

(b) The Assignee represents and warrants that this Agreement is the legal, valid
and binding obligation of the Assignee enforceable against the Assignee in
accordance with its terms.

SECTION 10. Beneficiaries. This Agreement and all obligations hereunder shall be
binding upon each of the parties hereto and any of their respective successors
and assigns. The LLC and its Members shall be express third party beneficiaries
of Assignee’s obligations under this Agreement.

 

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SECTION 11. Consents. The Board, on behalf of the LLC, hereby consents for all
purposes to (a) the transfer by the Assignor to the Assignee of the assigned
Units, (b) the withdrawal of the Assignor as a Member from the LLC, (c) the
admission of the Assignee as a Member of the LLC, (d) the addition of Assignee
as a Member on the Information Exhibit to the LLC Agreement, and (e) the
continuation of the business of the LLC without dissolution.

SECTION 12. Modification and Waiver. No supplement, modification, waiver or
termination of this Agreement or any provisions hereof shall be binding unless
executed in writing by all parties hereto. No waiver of any of the provisions of
this Agreement shall constitute a waiver of any other provision (whether or not
similar), nor shall such waiver constitute a continuing waiver unless otherwise
expressly provided.

SECTION 13. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Delivery by facsimile of
an executed signature page hereof shall be effective as delivery of an executed
counterpart hereof.

SECTION 14. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, and all rights and remedies
shall be governed by such laws without regard to principles of conflict of laws.

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the Assignor and the Assignee have duly executed this
Agreement as of the day and year first above written.

 

PETROTECH HOLDINGS CORP.   As Assignor By:  

/s/ Patrick Regan

Name:   Patrick Regan Title:   Authorized Signatory PETROALGAE INC.   As
Assignee By:  

/s/ David Szostak

Name:   David Szostak Title:   President

[SUBSTITUTE MEMBERSHIP AGREEMENT]

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Consented to and agreed upon as of the day first written above:

THE BOARD OF DIRECTORS OF PETROALGAE, LLC on behalf of PETROAGAE, LLC

/s/ Sayan Navaratnam

Name:   Sayan Navaratnam Title:   Director

/s/ John Scott

Name:   John Scott Title:   Director

/s/ Isaac Szpilzinger

Name:   Isaac Szpilzinger Title:   Director

[SUBSTITUTE MEMBERSHIP AGREEMENT]