exhibit101.htm


    December
12,  2008

     

    STRICTLY
PRIVATE AND CONFIDENTIAL

     

    Farm
Fresh Marketing Inc

    141 
First  Ave  East,  

    Jerome, 

    Idaho 
83338 

     

    Attention:
Mr. Herb Allen

     

    Dear Mr
Allen

     

    Memorandum
of Understanding – proposed project for the installation of Heat Recovery Steam
Engines to be developed and manufactured by Clean Power Technologies
Inc.

     

    Further
to our recent discussions, this memorandum of understanding (“Memorandum of
Understanding”) sets out the high-level commercial principles subject to
which Clean Power Technologies Inc. (“CPTI”) and
Farm Fresh Marketing Inc. a company incorporated in the State of Idaho, and
having its Head Office at 141 First Avenue East, Jerome, Idaho (“Farm Fresh”)
intend to work together with the ultimate objective of making the Farm Fresh
truck fleet more energy efficient by installing a system developed and
manufactured by CPTI that utilises the otherwise wasted heat from the prime
mover exhaust system to power the refrigeration/conditioning unit (the “project”),
subject to further negotiation and signature by the parties of a legally binding
agreement.

     

    1.         INTRODUCTION

     

    
      	
              1.1  

            	
              With
      the exception of clause 1.2 and clauses 5, 6 and 7, this Memorandum of
      Understanding is intended to set out the high-level commercial principles
      and is

            


    

    not
intended by the parties to be legally binding.

     

    
      	
              1.2  

            	
              This
      Memorandum of Understanding is confidential to the parties and their
      advisers and any information or know-how disclosed to, or discovered by,
      either party to this Memorandum of Understanding is subject to the
      confidentiality agreement to be entered into simultaneously with this MOU
      between CPTI and Farm Fresh.

            


    

     

    
      	
              1.3  

            	
              Farm
      Fresh has a large fleet of trucks with refrigeration/conditioning
      units.

            


    

     

    
      	
              1.4  

            	
              CPTI
      is developing an energy efficient system that utilises the otherwise
      wasted heat from the prime mover exhaust system to power the
      refrigeration/conditioning unit (the
      “System”).
      The System proposed is a dual system unit which will operate when the
      tractor is operating with the refrigeration unit attached to it and as
      well it will be a stand-alone unit from the tractor unit being fixed to
      the

            


    

    refrigeration
unit and will operate to cool goods when the refrigeration unit is

    awaiting
the prime delivery vehicle.

     

    
      	
              1.5  

            	
              For
      the consideration described herein, Farm Fresh agrees to install the
      System into the truck and CPTI and Farm Fresh shall work together to
      ensure the efficient and effective installation of the
    system.

            


    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    2.         DATA
COLLECTION

     

    
      	
              2.1 

            	Before the System can be implemented into the
      truck fleet, CPTI shall undertake a
      period of data collection.
	 	 
	
              2.2 

            	
              CPTI
      requires the data to:

            


    

     

    
      
        	 	
                2.2.1

              	
                size
      the various components for the design of the new refrigeration units;
      and

              


      

    

     

    
      	 	
              2.2.2

            	
              understand
      the working practices of the Farm Fresh drivers and truck
      usage.

            


    

     

    
      
        	
                2.3 

              	
                During the data collection stage Farm Fresh shall make
      available:

                 

              


      

      	 	
              2.3.1  

            	
              key
      members of staff to assist with any reasonable requests of CPTI;
      and

            


    

     

    
      	 	
              2.3.2  

            	
              the
      truck fleet and garage facilities

            


    

     

    in order
to assist with the data collection process referred to in clause
2.1.

     

    
      	 	
              2.4 
      

            	
              CPTI shall seek Farm Fresh’s prior approval (not
      to be unreasonably withheld or delayed)
      before undertaking the activities specified in clause
      2.3.

            


    

           
3.         DATA COLLECTION
VEHICLE

     

    
      	
              3.1
       

            	
              Farm
      Fresh shall provide CPTI a truck, described as Road Load Data
      Collection Vehicle (“RLDCV”), type and specifications of which will
      be discussed with Farm Fresh’s President/Representative, Herb Allen, in
      Jerome, Idaho during personal meetings or telephonic
      discussions.

            


    

     

    
      	
              3.2  

            	
              CPTI
      shall install the data gathering systems on to the RLDCV for
      testing.

            


    

     

    
      	
              3.3
       

            	
              The Parties have agreed that testing procedures,
      including, but not limited to, fuel and operating efficiencies of CPTI’s
      Heat recovery Systems, noise and emission level and efficiencies, will be
      agreed to in detail during the follow-up meetings with the said Herb Allen
      (2.6) and from time to time on an ongoing basis.  Once
      CPTI’s Heat recovery Systems is developed and shown to the satisfaction of
      , the Parties hereto will thereafter enter into discussions to establish
      collaborations and commercial
      relationships.

            


    

     

    
      	
              3.4  

            	
              CPTI
      hereby agrees to indemnify and to hold Farm fresh harmless from and
      against any and all loss, liability, claims, causes of action, damages,
      penalties, fines, imposts, and expenses, including reasonable attorney
      fees and costs, arising out of or incurred in connection with the System,
      its installation on the RLDCV, or its use by Farm Fresh (except to the
      extent that Farm Fresh’s use is negligent or
  wrongful).

            


    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
      	
              4.  

            	
              COSTS

            


    

     

    
      	
              4.1  

            	
              CPTI
      shall be responsible for the data gathering, development of the engines
      and of outsourcing any part of the Project costs.  CPTI shall
      also be responsible for installation of the System on the RLDCV and for
      any damage to the RLDCV caused by such installation or the use of the
      System on the RLDCV.

            


    

     

    
      	
              4.2  

            	
              Other
      than as set out in 4.1, each party shall bear its own costs of the Project
      and providing any assistance referred to in this Memorandum of
      Understanding in accordance with Clause
6.

            


    

     

    
      	
              4.3  

            	
              For
      and in consideration of the services provided by Farm Fresh hereunder,
      including use of the RLDCV, CPTI agrees, for two years following
      completion of the test, to make the System (once it is in production)
      available to Farm Fresh, in such quantities as it may reasonably order, at
      prices and on terms at least as favourable to Farm Fresh as those offered
      by CPTI to any of its other
customers.

            


    

     

    
      	
              4.4  

            	
              Farm
      Fresh has a fleet of approximately 53 trucks and trailers and once CPTI’s
      technology is proven, it intends to purchase at least 53 Systems within
      the period mentioned in 4.3.

            


    

     

    
      	
              4.5  

            	
              Subject
      to formulation of a formal Distributorship Agreement and its acceptance
      thereof by future Distributors, CPTI hereby grants a First Right of
      refusal to Farm fresh for Distributorships for the States of Idaho,
      Montana, Washington, Oregon, Utah, Colorado and
  Nevada.

            


    

     

    5.         TITLE AND
INTELLECTUAL PROPERTY

     

    
       

      
        	
                5.1  

              	
                For
      the purposes of this Clause 5, the following term shall have the following
      meaning:

              
	 	 
      
                “Intellectual
      Property Rights” means trade marks, designs, patents, copyright,
      database rights, internet domain names, and other intellectual property
      rights, data and test results in each case whether registered or
      unregistered, and including applications for the grant of the foregoing
      and all rights or forms of protection having equivalent or similar effect
      to any of the foregoing which may subsist anywhere in the
      world.

              


      

       

      
        	
                5.2  

              	
                      
                  The
      parties agree and acknowledge that CPTI owns all
      Intellectual  Property Rights in the System and, notwithstanding
      any assistance provided by Farm Fresh, shall continue to own the
      Intellectual Property rights in the
  System.

                

              


      

       

      
        	
                5.3  

              	
                In
      the event that Farm Fresh by operation of law or otherwise acquire any
      Intellectual Property Rights in the System, it shall procure the
      assignment of such Intellectual Property Rights in the System (Licensing
      and/or Royalty terms and conditions to be negotiated) from CPTI and such
      assignment to be with full title guarantee and to include the right to sue
      for past infringement.

              


      

       

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    6.         GENERAL

     

    Both
parties are responsible for their own costs in connection with the proposed
Project, whether or not it proceeds (including (without limitation) the
preparation and negotiation of this Memorandum of Understanding) and any party
may end negotiations in relation to the proposed Project at any time in writing
without having to give any reasons for doing so or incurring any liability to
the other party.

     

    7.         GOVERNING LAW AND
THIRD PARTY RIGHTS

     

    
      	
              7.1. 

            	
              This
      Memorandum of Understanding and the negotiations between CPTI and Farm
      Fresh in connection with the proposed Project (“Negotiations”),
      and all disputes and claims arising out of or in connection with them, are
      governed by, and shall be construed in accordance with the laws of the
      State of Nevada. Each party irrevocably agrees to submit to the exclusive
      jurisdiction of the State of Nevada courts as regards any claim or matter
      arising under or in connection with this Memorandum of Understanding and
      the Negotiations.

            


    

     

    
      	
              7.2  

            	
              The
      parties agree that, this Memorandum of Understanding is not intended to,
      and does not, give to any person who is not a party to the Memorandum of
      understanding any rights to enforce the provisions of this Memorandum of
      Understanding.

            


    

     

    Please
confirm your agreement to the terms and conditions set out above by signing,
dating and returning a copy of this Memorandum of Understanding to
CPTI.

     

    Yours
sincerely

     

    /s/ Abdul
A.
Mitha                                                      

    ABDUL A.
MITHA,

    President/CEO

    For and
on behalf of

    Clean
Power Technologies Inc.

     

    CONFIRMATION

     

    We
confirm our agreement to the terms and conditions set out in the above
Memorandum of Understanding.

     

    Dated:  December
12, 2008

    Signed
by: Herb Allen

     

    SIGNED BY
FARM FRESH MARKETING INC.

     

    /s/ Herb
Allen                                                                

    For and
on behalf of

    FARM
FRESH MARKETING INC.


    
      
         


      

      
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