EXHIBIT 1

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 1 of 20
National Bic Fuels Houston, Texas 77056

Phone: 713. 353.7060

FAX: 713.993.0076

CONMRMATION LETTER

CONFIDENTIALITY NOTICE: The information is intended only for me use of the

individual or entity named below. If you are not the intended recipient, you are hereby

notified that any disclosure, copying, distribution, or taking of any action in reliance on the

contents of this information is strictly prohibited. If you have received this transmission in

error, please immediately notify us by telephone to arrange for return of the documents.

Date: December 16, 2005

Buyer: Royal Caribbean Cruises LTD, ("ECU'}

Seller: National Biofuels, L,P, ("NBF*)

The purpose of this Confirmation is to confirm the terms and conditions of the purchase

and sale of Biodiesel agreed upon by Buyer and Seller for the Term of this Contract

specified below. This Confirmation is being provided pursuant to, in accordance with, and

is subject to, the provisions included in the "Base Contract for the Purchase and Sale of

Biocteel" ("Base Contract"), In the event of conflict between the terms of this

Confirmation and the Base Contract, the terms of this Confirmation shall prevail. A signed

Confirmation together with the Base Contract shall constitute the ""Contract"

We confirm the following terms of our Transaction:

Product; No greater than 99,9% in volume of Agri-biodiesel that meets

ASTM 6751 standards for biodiesel, as such standards may change

from time to time during the Term of this Agreement, and which is

similar to the typical specification listed in Exhibit 1 and that is

manufactured from Palm oil or Falrn Qlein and no less than 0.01 % in

volume of diesel that meets the ISO 82 1 7 for DMA

Term: January 24, 2006 through December 3 1 , 2008

Biodiesel Price: $1 ,48/gallon delivered FOB Location plus applicable United States

Internal Revenue Service Fuel Excise Tax (currently $Q.244/gal

delivered).

The parties acknowledge that the above price per gallon takes into

account the benefit of the tax credit that Seller expects to receive in

connection with its sale of the Product to Buyer in accordance with

Section 40A of the Internal Revenue Code of 1986 and as amended,

In the event that Seller is unable to take Ml advantage of the tax

credit for any reason (including as a result of a disallowance or

similar adverse ruling or determination by the Internal Revenue

1of15 CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 2 of 20
National BtoFuals/^aramouni Petroleum Agreement 2 of 15

Service), Seller shall not seek compensation from Buyer for such

loss with respect to Product previously sold to Buyer hereunder. In

addition, Seller shall indemnify and hold Buyer harmless against all

loss, damage and expense arising from any claims that may be made

against Buyer by the Internal Revenue Service or other third party in

the event of any disallowance or similar adverse ruling or

determination with respect to the ability of Seller to claim the tax

credit for Product previously sold to Buyer hereunder.

Annual Commitment/Monthly Quantity:

Location:

Delivery Point:

For each calendar year for the Term hereof, Buyer commits to

purchase the minimum Annual Quantities set forth in Exhibit 2 and

Seller commits to sell the minimum Annual Quantities set forth in

Exhibit 2. In the event that either party fails to meet the Annual

minimum quantities in any year (tie '^on-Performing Party*}, such

party shall compensate the perfbiming party with respect to such

shortfall in accordance with the provisions of Section 3 in the Base

Contract.

Exhibit 3 sets forth the estimated Monthly Quantities that Buyer

expects to purchase during the Term hereof. In the event that Buyer

fails to purchase the specified minimum Monthly Quantities, Buyer

will seek to make up any shortfall in the subsequent month

("Monthly Shortfall"); however, Seller acknowledges that Buyer

shall not be liable for any Monthly Shortfall or for any failure to

make up for the Monthly Shortfall to the extent that the Monthly

Shortfall is 2000 MT or less. In the event that the Monthly Shortfall

exceeds 2000 MT for any month, Buyer shall compensate Seller for

the Monthly Shortfall in excess of 2000 MT in accordance with

Section 3 of the Base Contract, Any such excess for which Buyer

compensates Seller shall be treated as purchased Product for

purposes of calculating Buyer's required annual commitment. .

To assist Seller in projecting Buyer's Monthly Quantity for Product,

Buyer shall provide Seller by the tenth day of each month during the

Term hereof with a list of the monthly quantities that it expects to

purchase for the then remaining months of the Term. Buyer's current

Monthly Quantity is set forth in Exhibit 3,

Berth 70-71, or road rack (at Buyer's option) at West-way Terminal

Company, Signal St., San Pedro, CA 90733-0790, Buyer shall be

allowed to take up to 12 truck deliveries in any calendar year (with

reaspnable notice provided to Seller). Seller shall use reasonable

efforts to accommodate additional truck deliveries,

Buyer to receive at Location listed above at the inlet flange to vessel,

barge or truck, as the case may be.

National Bi CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 3 of 20
National BldFuefg/^ammoun! Petrdfeum Agreement 3of15

Payment:

Payment Terms:

Cancellation:

Buyer will pay the Biodiesel Price multiplied by the number of

gallons received at; the Location, The quantity shipped will be

verified by independent inspectorsPayment is based on FOB Location and is due 5 days from receipt of

original invoice. Payment will be made via Fed Wire Transfer to a

US-based financial institution.

Wire Transfer to:

Scheduling:

Buyer has the option to cancel Contract without liability if (i) Seller

Mis to deliver Product that does not meet ASTM 6751 specifications

(including situations involving the presence metal contaminants in

the Product) or (ii) if the Product adversely affects in a material

manner (determined from either an operational or economic

perspective) the operation of the vessel engines of the Buyer (e.g.»,

creates filter problems, clogging problems or combustion problems).

Prior to canceling this Contract in accordance with the preceding

sentence, Buyer will notify Seller in writing of the situation and also

provide a detailed description of the problem occurring with the fuel

specifications ofthe vessel engines, as the case may be ("Buyer's

Notification") and both parties will seek to rectify the situation.

Should the situation not be resolved to Buyer's satisfaction within

three months of Seller's receipt of Buyer's Notification, Buyer may

elect at its option to cancel the Contract.

Bank: JP Morgan Chase

ABA: 113000609

Acct: 00113435433

For ftather credit to: National Blofuels LP

Buyer

Seller

305.982.2706

713.454.7060

Special Provisions: (as required)

AGREED TO ANI> ACCEPTED BY:

5120 WoodwayDr #10010

Houston, Texas 77056

Phone: 713.353.4746

Fax: 713.456,2617

EO¥AL CAMBBEA|SI CRUISES LTD.

Address:

City, St, Zip:

Phone:

Fax: 5Q^ 'no; "IHUa

^.\l

Name: Gerardo Manatee

Title: Chairman

Name:

Title:

CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 4 of 20
National BloFuttls/Peramftrflt Petroleum Agreement 4 of 15

BASE CONTRACT FOR THE PURCHASE AND SALE OF BIOBI&SEL ("BASE

CONTRACT")

L DEFINITIONS:

a. "Business Day" shall mean any day other than Saturday, Sunday or a public holiday in the State of

Texas or the United States of America,

b. "Contract" shall mean this Base Contract and the terms and conditions of any Confirmation Letter

accepted by Buyer with respect to this Base Contract,

c. "Contract Price" shall mean th& amount expressed hi U.S. Dollars per gallon to be paid by Buyer to

Seller fi>r the purchase of Product as agreed to by the panics in a transaction*

d "Contract Quantity" shall mean the Quantity of Product to be delivered and taken as agreed to by the

e, "Cover Standard", as referred Co in Section 3, shall mean that if there is an unexcused failure to take ot

deliver any quantity of Product pursuant to this Contract, then the performing party shall use

commercially reasonable efforts to (i) if Buyer is the performing party, obtain Product, (or an alternate

product if elected by Buyer and replacement Product is not available), or (ii) if Seller is the performing

party, sell Product, in either case* ai a price reasonable for the delivery or production area, as

applicable, consistent -with: the amount of notice provided by (he nonperfbrming party; the immediacy

of the Buyer's Product consumption needs or Seller's Product sales requirements, as applicable; the

quantities involved; and the anticipated length of failure by the nonperforaiing party.

f, "Day" shall mean a consecutive twenty-four (24) hour period commencing at 00:00 hours Central

Time and ending at 23:59^51? hours Central Time.

g, "Green Tags" means (i) any and all credits, benefits, certificates, or similar instruments or rights

issued, recognized, created or authorized tor the non-energy attributes which are associated with or

derived from the use of Product as a fuel for energy generation or transportation in contrast to the use

of coal, fuel 00 or other fossil fuels for energy generation or transportation; and (ii> aay and all credits-,

benefits, certificates, or similar instruments or rights issuedj recognized, created or authorized under

private contracis or any statute, regulation, order or regulatory or governmental program, or voluntary

program for renewable energy or green pricing or any other renewable ecergy mandate or objective

which result or arise from or are attributable to the use of Product far energy generation or

transportation fuel or are associated with Product being a "green" or renewable fuel.

h. "Product" also designated as "Biodiesel" or "Blender B99,9", means a fuel comprised of mono-alky]

esters of long chain fairy acids derived from vegetable oils or animal lats that, for the Agri-fekKliesel

component of die Product, meets the requirements of the American Society for Testing and Materials

irtematioaal {ASTM) specification for ASTM 06751-03 or other specification agreed upon by both

Parties.

i, "Month" shall mean the period beginning PH the first Day of the calendar month and ending

immediately prior to the eorameftcenient of the first Dsy of the next calendar month.

j, "Quantity" shall mean fatftautoy of Product to be delivered and taken as agreed to by the parties in a

transaction for a given calendar year.

k. "Payment Date" sfeall mean a date, as indicated on this Base Contract, on or before which payment is

due Seller for Product received by Beyer in the previous Month.

2. TITLE: Title to the Product shall pass from Seller to Buyer at the Delivery Points). Title to the Product

shall include any Green Tags associated with the Product. Seller shall have responsibility for and assume

any liability with respect to the Product prior to its delivery to Buyer at the specified Delivery Points).

Buyer shall have responsibility for and any liability with respect to said Product after its delivery to

Buyer at the Delivery Pcial{s). Seller warrants that if will have the right to convey and will transfer good

and roercbantabb title to a|i Product sold heireuacfer and delivered by it to Buyer, free and clear of all

liens, encumbrances, and claims, EXCEPT AS PHOVIDED IN 1HIS SECTION 2 AND IN SECTION

20,h, ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF

MERCHANT ABILITY OR OF HTNESS FOR ANY PARTICULAR PURPOSE, ARE DISCLAIMED.

National Bi Fuels CONFIDENTIAL

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National BioFuels/Paramount Petroleum Agreement 5 of 15

Seller agrees to indemnify Buyer aad save it harmless from all losses, liabilities or claims including

reasonable attorneys' fees and costs of court ("Claims"), from any and all persons, arising from or out of

claims of title, personal injury or property damage from said Product or other charges thereon which

attach before title passes to Buyer, Buyer agrees to indemnify Seller and save it harmless from all

Claims, from any and all persons, arising from or out of claims regarding payment, personal injury or

property damage from said Product or other charges thereon which attach after title passes to Buyer.

Notwithstanding the other provisions of this Section 1, ;is between Selte and Buyer, Seller will be liable

for all Claims to the extent that such arise from the failure of Product delivered by Seller to meet die

quality requirements of Section 6, provided, that Se1kr*s maximum liability for such Claims shall be no

greater than the product of the Contract Price multiplied by (he quantity of Product foiling to meet the

quality requirements of Section 6,

3, PERFORMANCE OBLIGATIONS: Seller agrees to sell aad deliver, and Buyer agrees to receive and

purchase, the Contract Quantity for a particular transaction in accordance with the terms of the Contract

The sale and exclusive remedy of the parties in the event of a breach of an obligation to deliver or

receive Product shall be recovery of ilk following: (i) in the event of a breach by Seller on any Dayts),

payment by Seller to Buyer in. an amount equal to the positive difference, if any, between the purchase

price paid by Buyer utilizing the Cover Standard and the Contract Price, adjusted for commercially

reasonable differences in transportation costs to or from the Delivery Poirtl(s) and additional storage

costs incurred in a commercially reasonable manner, multiplied by the difference between the amount

i&at Seller was otherwise obligated to deliver under the Contract for such Day(s) mid the quantity of

Product actually delivered by Seller for such Day(s): or (ii> is the event of a breach by Buyer on any

Dayfs), paymsai by Buyer to Seller in the amount equal to the positive difference, if any, between the

Contract Price and the price received by Seller utilizing &s Cover Standard for the resale of such

Product, adjusted for commercially reasonable differences in transportation costs to or from the Delivery

Points) and additional storage costs incurred in a commercially reasonable manner., multiplied by the

difference between the amotmt that Buyer was otherwise obligated to purchase under the Contract and

the quantity of Product actually taken by Buyer for such Dfly(s). The amount of such unfavorable

difference shall be payable five Business £>ays after presentation of the performing party's invoice,

which shall set forth the basis upon which such amount was calculated. Notwithstanding anything to the

contrary herein, die Enaxiiaum liability of the sou-performing party for the amount of sach unfavorable

difference shall be no greater than the product of (a) the Contract Price multiplied by (b) the difference

between (!) the amount that Seller was otherwise obligated to deliver under the Contract for such Day(s)

and (2) the quantity of Product actually delivered by Seller, in the case of clause (i) above, or the quantity

of Product actually taken by Buyer, in the case of clause (ji) above.

4. ASSIGNMENT OF COSTS: Seller agrees to arrange traasporta^oa andfor storage as necessary to take

receipt of the Quantity at the Location. Bayer will be responsible for all costs and arrangements to

purchase and provide Transport of Product from the Delivery Point Seller will be responsible for all

costs and arrangements to purchase and provide Transport of Product to the Delivery Point

5, INSPECTION AND MEASUREMENT: Measurement of tide volume of Pnxfaut delivered uiider this

Contract will be accomplished by Seller using either gauging or raster readings of shore tanks, deliveiy

vessels, barges, or pipelines. All measurement and gawgiag under iJiis Agreeoraat will be made in

accordance with the latest approved meihods of the American Petroleum Institute ("API") at the time

such measurements are made and in the absence of such approved methods, in accordance with those of

the American Society of testing and Materials. All volume of delivered Product will be corrected for

temperature 60 degrees Fahrenheit in accordance with the latest API volume correction feelers for such

Product- Setter's measurement of the qtiantky of Product delivered will be conclusive, absent manifest

error. Buyer may have a representative present to observe the measurement of the volume of the Product

delivered. Ai each Product delivery. Sells* shall collect three Samples of the Product from the iil-Kne

delivery equipment and sign, seal and label the retained samples. Buyer may taut* representative

present at the time of sampling. Seller will provide one sample to Buyer and will provide one sample to

an independent reference laboratory.

6. CERTIHCATION OF ASTM 6751: Seller shall certify that the lot of the Agri-biodiesel component of

the Product delivered to the Buyer meets ASTM 6751 standards for biodiesel by providing the results, at

Buyer's request, from an independent reference laboratory of the lot of the AgrHsiodiesel component

National EHCFufels CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 6 of 20
National BioFueis/Paramount Petroleum Agreement 6 of 15

Product delivered to the Buyer.

7. DELIVERIES: Deliveries shall be made at such times as may be required by the receiving party,

provided that reasonable advance notice of each delivery required has been given Buyer. At the time of

giving such notice. Buyer shall furnish Seller necessary shipping instructions. Seller shall prepare and

furnish the receiving party with copies of bills of lading Mid other Shipping papers.

8, TAXES: Seller shall pay or cause to be paid all axes, fees, levies, penalties, licenses or charges imposed

by any government authority OTaxes") on or with respect to Product prior to the Delivery P0inl(s) aad

all Taxes at the Delivery Points). Buyer Shall pay or cause lo be paid all Taxes on or with respect to the

Product after the Delivery Points). If a. party is required to remit or pay Taxes that are the other party's

responsibility hereunder, the p&tfy responsible for «ach Taxes shall promptly reimburse the oflier party -

for such Taxes. Any party entitled to £> exemption ftorn aay siicb Taxes or charges shall furnish the

other party any necessary dtjeumentatiwi thereof. la those caws in which tbe laws, regulations or

ordinances impose upon Seller the obligation Jo collect from Buyer such taxes, excises, charges and

inspections or other fees, Buyer shall gay to Seller amounts equivalent to such governmental

retpajements- (feted above) for v$a&& Buyer shall be liable. If Buyer is entitled to purchase products free

of1 any tax, fee or charge. Buyer shall furnish to Seller proper exemption certificates to cover such

9. CREDITS: Seller shall be entitled to aiJ credits, sax exemptions, tax credits, and excise tax credits

("Credits") related to the Product tot arises as a result of Seller's ownership, processing, possession or

use of the Product through the date of Delivery*

10. (3&EEN TAGS: Upon taking title to the Product, Buyer takes any ami all rights, title and interest in and

to any and aO Green Tags that result or arise &om or are attributable to the use of Product, whether

arising or coming into existence before or after the sale of Product under this Contract. Seller agrees to

cooperate, at Buyer's expense, in any and all additional actions as may be reasonably necessary to: (i)

procure any certificates or credits that may be issued or are is&uable by any government or regulatory

agency and that are included ia the d&foution of Green Tags; ana* (ii) effect and record o? otherwise

evidence the assignment to Buyer of aay and all of Seller's light,, title and interest in and to such Green

Tags whs* and as they are generated (including such certificates or eredils when and as fliey are issued)

OH such periodic basis as may be required by law or aa Buyer may reasonably request without any coat,

fee or charge . Buyer shall pay or reimburse Seller for all out-of-pocket expenses incurred by Seller in

connection with soy actions cGRtenaplated by the provisions set fortfe in (i) and (ii) above,

11. WARRANTIES AND INDEMNIFICATION: Seller warrants title to Products delivered hereunder, that

Seller has the right to sell such Product and that it is free from liens and adverse claims of every kind.

Seller will pay all royalties and other sums due on production, processing or hajidh'ng of Product

delivered herein, unless otherwise specified. Seller will indemnify and hold Buyer harmless against all

loss, damage and expense on account of adverse claims to Products delivered or of royalties, payments or

Qlher charges thereon applicable before or upon delivery. Buyer will indemiHly and bold Seller harmless

against all loss, damage and expense on account of adverse claims to Products delivered or of royalties,

payments or other charges thereon applicable at or after delivery. Seller warrants that it has complied

with all laws, orders., rules, regulations or acts of aay government or governmental body or authority

having jurisdiction owr the production, manufacture, preparation, sale or transportation of Products

delivered.

12. PAYMENTS; Seller shall invoice Buyer wM^ProdffiS,has b&eadeUvered, received, tested, measured,

and certified (pursuant to Section 5, 6, and 7). Buyer shall remit Ihe amount due in immediately

available fiiflds 5 Days after receipt of the original invoke by Buyer {"Payment Date"); provided that if

the Payment Date is not a Business Day., payment is due on the Business Day preceding that data.

13. DISPUTED PAYMENTS: Eitber Party may, in good faith, dispute the correctness of any invoice or any

adjustment to any invoice rendered hereunder. Immediately following the receipt of notice of a disputed

invoice amount, the parties shall meet within tiara (2) Business Days and shaJI undertake good faith

efforts to resolve any dispute, These efforts may include, but not be limited to, an analysis of the invoice

calculation methodology substantiated by relevant information provided by either Party. In the 0vent the

Parties are unable to resolve the dispute following receipt of the invoice, then payment for the total

amount of the isvoice less the disputed amount, shall be made wfeen due, with written notice of the

Rational BloPuels CONFIDENTIAL

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National BioFuels/Paramount Petroleum Agreement 7 of 15

dispute {including (he basis for the dispute) accompanying such payment. If a party is found to have

overpaid an invoice, tlat party shall be due an immediate refund of such overpaid amount, including any

accrued interest at the Interest Rate defined as the lower of (i) 15% per annum or (ii) the maximum rate

permitted by applicable laws until paid If a party is found to owe additional roads, such party shall

immediately remit payment, including any accrued interest oa the additional funds owing but unpaid at

the Interest Rate specified in this Section 13 from tne date such additional rands were originally due until

paid,

14. FINANCIAL RESPONSIBILITY:

a. la the event (each an "Event of Default") either party (the "Defenlting Party'1) or is guarantor shall;

ii) make an assignment or any general arrangement fbr the benefit of creditors; (ii) file a petition or

otherwise commence, authorize, or acquiesce in the commencement of a proceeding or case under

any bankruptcy or similar law for tie protection of creditors or have such petition filed or

proceeding commenced against it; fiii) otherwise become bankrupt or insolvent (however

evidenced); <iv) be unable to pay its debts as they faH due; (v) have a receiver, provisional liquidator,

Gonserrator, custodian, trustee or other similar official appointed with respect to it or substantially

all of its assets; or (vi) aot have paid any amount due the other parry hereuader on or before the third

Business Day following written Notice that such payment is due; fliea the other party (the "NonDefaulting Party') shall have tne right, at its sole election, to immediately withhold aadVor suspend

deliveries or payments upon Notice and/or to terminate and liquidate the transactions under the

Contract, in the manner provided m Section 14.b, in addition to any and all other remedies available

hereunder.

b. If an Event of Default has occurred and is continuing, the Non-Defaulting Party shall have Hie right,

by Notice to the Defaulting Parry, to designate a Day, no earlier ihan the Day such Notice is given

and ao later than 20 Days after such Notice is given, as an early termination date (the "Early

Terajiaatioa Bate") for the liquidation and termination this Contract. On the Early Termination

Date, Siis Contract will terminate.

c. As of the Early Termination Date, the Non-Defaulting Party shall determine* ia good feith. and in a

commsTCiaHy reasonable manner, ihe amount owed (whether or DO* then due) by each parry with

respect Co all Protiyea delivered and received between the parties under liiis Contract on arid before

the Early Teraimatkm Date and all other applicable charges relating to such deliveries and receipts

(including without limitation any amomtts owed under Section 3), for which payment has not yet

been made by the party that owes such payment under this Contract.

d. The Nro-Defajltiiig-Pvrty shall aet or aggregate, as appropriate, any and all amounts owing between

the parties under Section 14,c, so that all such amounts are netted or aggregated to a single liquidated

amount payable by one party to the other (the "Net Settlement Amount"). Ai its sole option and

without prior Notice to the Defaulting Party, the Now-Defaulting Party may setoff (i) any Net

Settlement Amount owed to the Hoti4>sfktikmg Party against any margin or other collateral held by

the Non-Defedting Party rejatiag to the Crattact; or (ii) any Net Settlement Amount payable to the

Defaulting Party against any amounts) payable by the Defaulting Party to fha Non-Defaulting Parry

under any other agreement or arrangement between the parties,

e. The Non-D.dauleiag Party's remedies under this Section 14 are the sole sad exclusive remedies of

the Non-Defaulting Party wife respect to the occurrence of any Early Termination Date. Each party

reserves to itself all other rights, setofik, counterclaims and other defenses that it is or may be

entitled to arising from the Contract

15. CHANGEINLAW. If, after the date of execution of tosCoat^

of America of any state thereof, or any branch, division, or agency of such government, issueSv adopts,

imposes, promulgates, cancels, or modifies any status, ordinance, law, directive, order, resolution, or the

like, of issues a public notice or private ruling to Buyer or Seller with respect to or any such statute,

ordinance, law, directive, order, resolution, or (toe like, which materially alters, impairs, or hinders the

obligations or requkem^its of Seller or Buyer under this Contract or which materially changes, alters,

impairs, or hinders the economic benefits anticipated to accrue to the Sdler or Buyer rader this Contract

upon the date of execution hereof (a "Cfaaage in Law"), Buyer and Seller shall renegotiate w good faith

the coitimercial terms of this Contract. In event that the parties are unable to reach agreement on the

2flielf CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 8 of 20
National BioHuels/Paramount Petroleum Agreement S of 15

revised commercial terms within ten days* either party may terminate this Contract without liability upon

twenty (20) days written notice to the other party.

16. FORCE MAJEURE: If either party is rendered unable by force inajeure, wholly or in part, to perform or

comply with any obligation or condition of this Agreement, upon such party's giving limely notice and

reasonably Ml particulars to die other party such obligation or condition shall be suspended during the

coatmuatrce of the inability so caused and such party shall be relieved ofliability and shall suffer no

prejudice for failure to perform the same during such period provided obligations to make payments then

due for predicts delivered heraindar shall not be suspended.. The party having the difficulty shall iwitify

the other party of aay change in circumstances giving rise to the suspension of its performance and of its

resumption of pearformaace under this Agreement The term "force majeure" shall include, without

limitation by the following enumeration.; Acts of God, war, terrorism, the ekmeats, fire, accidents,

breakdowns, strikes, lockouts, differences with workmen, md my other isdustrial, civil or public

disturbance, interruption of deliveries of Product to Seller from Seller's upstream suppliers for aay

reason (including, for the avoidance of doubl* by reason of breach of contract by such upstream

suppliers), or any act or omission beyond the control of the party having the difficulty, and any

restrictions or restraints imposed by laws, orders, rules, regulations or acts of any government or

governmental body or authority, civil or military. The term "force majeure" shall not include (i) strikes,

lockouts or sbwdowas by Seller's or Buyer's work force, or (ii) loss of Buyer's markets or Bayer's

inability economically to sell or reuse the product hereunder. No event shall be considered ft> fee Force

Majeure unless it is reasonably beyond the control of either party or either party's subcontractors and

could not have been anticipated by such party when signing this Contract.

17. DISPUTE RESOLUTION AND ARBITRATION. The parties shall make a good faith effort to settle aay

dispute arising out of or relating to this Agreement, or (he breach hereof- If such a dispute cannot be

settled amicably between the parties within thirty (30) Days after the giving of notice by either party of

the existence of such dispitfe, ttien the dispute claim shall be exclusively referred to asd finally settled by

binding arbitration pursuant to the arbitration rules set forth by the United Nations Commission on

International Trade Law {UNCITRAL) Rules of Arbitration, as then in effect and as may be modified by

the rest of this Section 17. Each arbitral tribunal snail consist of a panel of three arbitrators (or such

lesser number as the parties may agree) appointed in accordance with the UNCITRAL Rules. If aay party

fails to timely appoint an arbitrator in accordance with fee UNCITRAL Rules, or if die two partyappointed arbitrators fail to limely appoint a third arbitrator^ upon the request of either party the

International Chamber of Commerce Court of Arbitration shall act as appointing authority for such

arbitrators. The arbitration proceedings shall bs conducted vz New YoA, New York and in the English

language, and the sward rendered m the English language. The award of the arbitrators stall be final aad

binding, and shall be the sole and exclusive remedy between the parties regarding any controversy,

claims, counterclaims, issmes, or accountings, presented to the tribunal. Any monetary award shall be

rnadc and payable im tWWsd States Dollars,, free of any tax or other deduction, and shall include interest

from She date of any bijeacfa or other violation of this; Agreements the date on which the award is paid,

at a rate determined by (he Arbitrators. The costs and fees of the arbitration shall be allocated by ihe

arbitrators, wte shall haw ifee authority to award; costs and ftes to ths prevailing party. Tins arbitral

award shall be enforceable by any court having jurisdiction for that purpose.

18. LIMITATIONS: PORBREACH OF ANY PROVISION FOR WHICH AN EXPRESS RBMEDY OR

MEASURE OF DAMAGES IS PROVIDED, SUCH EXPRESS RBMEDY OR MEASURE OF

DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY. A PARTY'S LIABILITY

HEREUNDER, SHALL BE LIMITED AS SET FORTH IK SUCH PROVISION, AND ALL OTHER

REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED, IF NO REMEDY OR

MEASURE OF DAMAGES IS EXPRESSLY PROVIDED HEREIN OR IK A TRANSACTION, A

PARTY'S LIABILITY SHALL BE LIMITED TO DIRECT ACTUAL DAMAGES ONLY. SUCH

DIRECT ACTUAL DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY, AND ALL

OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. UNLESS

EXPRESSLY HEREIN PROVIDED, NEITHER PARTY SHALL BE LIABLE FOR

CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY OR INDIRECT DAMAGES, LOST

PROFITS OR OTHER BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR

CONTRACT, UNDER ANY INDEMNITY PROVISION OR OTHERWISE. IT IS THE INTENT OF

THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED ON REMEDIES AND THE

MEASURE OF DAMAGES is WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED

National Bi Fuels CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 9 of 20
National BioFuels/Paramount Petroleum Agreement 9 of 15

THERETO, INCLUDING THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH NEGLIGENCE

IS SOLE, JOINT OR CONCURRED, OR ACTIVE OR PASSIVE, TO THE EXTENT AHY

DAMAGES REQUIRED TO BE PAID HEREUNDER ARE LIQUIDATED, THE PARTIES

ACKNOWLEDGE THAT THE DAMAGES ARE DIFFICULT OR IMPOSSIBLE TO DETERMINE,

OR OTHERWISE OBTAINING AN ADEQUATE REMEDY IS INCONVENIENT AND THE

DAMAGES CALCULATED HEREUNDER CONSTITUTE A REASONABLE APPROXIMATION

OF THE HARM OR LOSS.

19. NOTICES: Alt Notices required hereunder may be sent by facsimile or mutually acceptable electronk

means or an internationally recognized overnight courier service. Notice shall be given when received

on a Business Day by the addressee. In the absence of proof of the actual receipt date, the following

presumptions will apply. Notices sent by facsimile shall be deemed to have been received upon the

seeding party's receipt of its focsiwUle machine's confirmation of successful trai^missiaa. If the Day on

which such facsimile is received is not a Business Day or is after five p.m. Ceotral Time on a Business

Day of the addressee, then such facsimile shall be deemed to have been received on the iiext following

Business Day. Notice by international courier shall be deemed to have been received on the next

Business Day after it was sent or such earlier time as is confirmed by the receiving party.

20. MISCELLANEOUS:

a. This Coatracl shaU be binding upon and imure to the benefit of ihe successors, assigns, personal

representative^ and heirs of the respective parties hereto, and the covenants, conditions, rights and

obligations of this Contract shall run fear Hie fell tens of this Contract, No assignment of this

Contract, in whole or in part, will be jnade without the prior written consent of the non-assipiing

party {and shall not relieve the assigning party from liability hereuBder), which consent will not be

unreasonably withheld or delayed; prevailed, either party m&y (i) transfer, sell, pledge, encumber, or

assign this Contract or t!ie accounts, revenues, or proceeds hereof in cotmeclioB with any financing

or other financial arrangements, or (ii) transfer its interest to afly parent or affiliate by assignment,

merger or otherwise without the prior appmval of the ote: party. Upon aay smell assignment^

& discharged from any obUgatioas bcreander.

b. If any provision in this Contract is determined to be invalid, void or imenforceable by any court

having jurisdiction, such determination shall not invalidate, void, or make unenforceable any other

provision, agreement OJT covenant of this Contract.

c. No waiver of any breach of this Contract shall be held to be a waiver of any other or subseqtient

breach.

d. This Contract sets forth all understandings between the parties respecting each transaction subject

hereto, and any prior contracts,, umfestaadings and representations, whether oral or written, relating

to such transactions are merged into and superseded by this Contract and any effective

transaction's). This Contrast may be amended only by a writing, executed by both parties.

e. The interpretation and performance of this Contract shall be governed by the laws of the State of

New York, excluding, however, any conflict of laws ro!e which would apply the law of another

jurisdiction,

f. This Contract and all provisions herein will be subject to all applicable and valid statutes, rules,

orders and regulations of soy governmental authority having jurisdiction over the parties, their

facilities, tbis Contract or transaction or any provisions thereof.

g. There is no thmJ party beneficiary to this Contract.

h. Each party to this Contract represents and warrants that it has foil and complete authority to enter

into and perform this Contract. Each person who executes this Contract ora behalf of either party

represents and warrants thtt it has foil and complete authority to do so and that such pany will be

bound thereby.

L The headings and subheadings contained in this Contract are used solely for convenience and do not

constitute a part of this Contract between the parties and shall not be used So con&tttic or interpret the

provisions of this Contract.

National Bi Fuels CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 10 of 20
National BioFueis/Paramount Petroleum Agreement 10 of 15

j. Uakss the parties have provided written consent, neither party shall disclose directly or indirectly

without the prior written consent of the other party the terms of any transaction to a third party (other

than the employees, lenders, counsel, accountants and other agents of the party, or prospective

purchasers of all or substantially all of a party's assets or of any rights under this Contract, provided

such persons shall have agreed to keep such terms confidential) except (i) in order to comply with

any applicable law, order, regulation, or exchange nUe, (ii) to the extent necessary for the

enforcement of this Contract* (iii) to the extern necessary to implement any transaction, or (iv) to the

extent such information is delivered to such, third parry for the sole purpose of calculating a

published index. Each party shall notify thft other party of any proceeding of which it is aware

which may result in disclosure of the terms of any transaction (other thaa as permitted hexeunder)

and use reasonable efforts to prevent or limit the disclosure. The existence of this Contract is not

subject (o this confidentiality obligation. Subject to Section 18, the parties shall be entitled to all

remedies available at law or in equity to enforce, or seek relief in connection with this confidentiality

obligation. The terms of any transaction hereunder shall be kept confidential by the parties hereto

for one year from the expiration of the transaction.

k. In the event (hat disclosure is required by a governmental body or applicable law, the party subject

to such requirement may disclose the material terms of this Contract to the extent so required, but

shall promptly notify ihe other party, prior to disclosure, and shall cooperate (consistent with the

disclosing party's legal obligations) with the other party's 0ffarts to obtain protective orders or

similar restraints with respect to such disclosure at the expense of the other party.

I This Contract constitutes the entire agreement between the parties. No promises, agreements or

warranties additional to this Agreement shall be deemed a part thereof, nor shall any alteration or

amendment of this Agreement be effective without the express written agreement of both parties.

IN WITNESS WHEREOF, the parties hereto have executed this Base Contract in

duplicate,

National BjMuela \&. Royal Caribbean Cruises, LTD,

Name: Gerardc/Manalac ~~~ Name: fe^oao f&yfe

Title: Chairman Tide: ..C£o

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 11 of 20
NatfonarBioFueJs/ParafnQtrnt Petroleum Agreement 11 of 15

Exhibit 1-TYPICAL SPECIFICATION

No.

1.

2,

3,

4.

5.

6.

7.

8.

9.

10.

11.

12.

13,

14.

15.

Parameters

FLASH POINT (J3C)

WATER CONTENT

VISCOSITY AT 40

 UC

ACID VALUE

(MG/KOH/G)

PHOSPORUS

CONTENT

SULFATEDASH

SULFim

COPPER STRIP

CORROSION

CETANE NUMBER

CLOUD POINT

CARBON RESIDUE

FREE GLYCERIN

TOTAL GLYCERIN

DISTILLATION TEMP

POUR POINT

Test

metiiod

D93

D2t09

D445

D664

D4951

D874

D5453

D130

D613

P250Q

D4530

D6584

D6584

D'U60

097

Specification

130 MINIMUM

SOOtmgTOi

MAXIMUM

1.9-6.0

MAX04UM

0.8 MAXIMUM

IOMG/KG

MAXIMUM

200 mg/kg

maximum

15 mg/kg maximwn

No. 3 max

47 mimtnum

Reisort

500 mg/kg

maximum

100 mg/kg

maximum

1800 mg/kg

maximum

3 60 Degrees c

maximum

-7 degrees c

National Bl Fuels CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 12 of 20
Minimum Maximum

Quantity Quantify

Year (in MT) (In MT)

2006 40,000 45,000

If ear

2007

EXHIBIT 2-

MINIMUM ANNUAL QUANTITIES

Minimum Maximum

Quantity Qaafitfty

(inMT) (irnMT)

45,000 50,000 29QS

Mloimum

Quantity Quantity

(ID MT)

30,000 35,000

12of15 CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 13 of 20
13 of 15 CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 14 of 20
National SioFuels/Paramount Petroleum Agreement 14 of 15

Exhibit 3

MONTHLY QUANTITIES

Minimum Maximum

Quantify (u» Qwaptity

Month MT) (MMT)

1,500 (as

Jan-06* available)

Feb-06

Mar-06

Apr-06

May-06

«&

Jul-06

Aug-06

Sep-06

Oct:-06

Nov-06

Dec-06

2,000

4,000

6,500

4,000

7,000

8,000

3,000

4,000

2,500

5,000

7,500

4,500

7,500

8,500

4,000

5,500

Minimum Maximum Minimum Maximum

Quantity Quantify Quantity Quantity

Month (in MT) (lit MT) Mooth (iu Ml) (la MT)

Jau-07 6,000 6,500 Jan^OS 4,000 4,500

Fefa-07

M^7

Apr-07

May-07

Jun-07

J«1-07

Aug-07

Sep-07

0ct-G7

Nov.07

Dec-07

3,000 3,560 Feb-GS

4^06 5,080 Mar-OS

7,000 7,500 Apr-OS

,4^500 5,000 May-OS

luu-OS

Jul^Jg

Aug-08

6,000 6,500 Sep-08

7,000 7,500 Qct-m

3,000 3,500 H0v~9S

4,000 5,000 Dec-OS

2,000

3,000

5,000

3,000

-

-

-

3,000

5,000

2,000

3,000

2,500

3,500

5^00

3^00

3,500

5,500

2,500

4SOOG

* Minimum/Maximum Quantity in Ql of 2006 will be adjusted by the actual amount delivered in January 2006.

MT is Metric Tonnes

National BloFueis CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 15 of 20
National BloFuels/Pararnounf Petroleum Agreement 15 of 15

National Bi 'Fuels CONFIDENTIAL

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 16 of 20
EXHIBIT 2

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 17 of 20
"GP Manatee" To <MMcNamara@rccI.com>

<gpmanalac@fulcrumpower,e Miy , _ _ ^ ~^ r ^ "Kevin Gorman - Contacts"

<kgorman@r>atiQnalblofueis,corri>

04/18/2007 01 ;55PM bcc

Subject RE; Urgent - Ne«d to discuss inventory issue

I will call you in 15 minutes to review this and our position.

From: MMcNamara@rcd.com [matlto:MMcNamara@rcc!,corn]

Sent: Wednesday, April 18, 2007 12:05 PM

To; GP Manalac

Subject; Re: Urgent - Need to discuss Inventory issue

I can hold off for now, if you call me before 2:45 eastern time, I willbeunavaiablefifom3:00pm-5:00pra,

Original Message

From: "GP Manalac" [gptnaoalac@ftilcrunipower.con4

Sent; 04/18/2007 11:30 AM EST

To: Michael McNamara; <gpraana!ac@natiofl.albiofbels.corri>

Ca Paul Utvinov; "Kevin Gorman - Contacts1' <kgorman@natiorialbiofiiels,conpSubject: RE; Urgent - Need to discuss inventory issue

1 need about another two hours because we are still getting final inventory numbers from Westway. I want

to give you the most up to date info on wttere things stand when I call.

From: MMcNamara@rccl.com [mailt3orMMcNamara@rccl.com]

Sent: Wednesday, April 18,2007 11:04 AM

To; gpmanalac@ nat1onalbtofuels.com

Cc; PUtvlnov@rccl.com; Kevin Gorman - Contacts

Subject! Urgent - Need to discuss inventory issue

GP,

I am sending you this email because I need to talk to you urgently and you have not returned my calls yet,

I spoke with Kevin about this matter, but all he can do is recommend that I call you.

The cor© issue is, that based on information we have received, you have loaded out a cargo of blodtesel

from Westway that is the product that you have already sold to us; furthermore, that as a result of this

shipment you may not be able to deliver the biodiesel scheduled for pickup this week by Jankovlch.

When Paul questioned Kevin about this last night, Kevin said that it was your position that we do not ovm

any of the biodiesel in (he terminal I need to know what NBPs official position is so we can work this out.

Time is of essence on this issue, and If I do not hear from you by 1 :OOPM; I will have to contact our

attorneys and our insurance carrier and put them on notice of the potential loss/theft of

Royal Caribbean Cruises Ltd. assets, I aiso need to know immediately if you are in a position to meet this

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 18 of 20
weeKs biodiesel nomination, If I do not hear from you I will have to commit to buy MGO because I will not

risk the potential of not having fuel for Infinity on Sunday.

I truly hope to avoid this process which will undoubtedly get very ugly Shd costly for NBF. If you get in

touch with me we should be able to get a better understanding of the issue and hopefully find a simple

resolutionT. McNamara

Director, Fuel Supply

RoyaJ Caribbean Cruises Ltd,

(305) 539-6010 Office

(786) 546-3468 Cell

mrncnatnsilSjrecLcom

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 19 of 20
2GG? Contract cakuEatlors

jan 6,000 contract (in MT)

fab 3,000 contact (to MT)

mar 4,500 cofrtrad: gn MT)

sprH 7,000 contact (tfi MT)

total 20,500 total

Carryover {2,000} carryover per the contract

Total actual take (6,926) Jan-Apr

tafe w pay obligation 11,574

conversion from ml to gai 301 x

total gallons 3.483,85?

percontracf take o*1 pay obligation 5,iSB.iga 9afiDnsxJi,48/ga)

Cover standard revenue from sales (3,650,000} 7300 NfT x SaDOMTte^) with the eat 4200 MT in tank worth nothing because it is frozen (due to RCCL not taking it)

less costs cost ftwn storage 424.S4Q from previous spreadsheet provided to RCCL

less costs opportunity cost for storage ^ IJ^^f from previous spreadsheet prewicted to RCCL

Total owed by RCCL 3356,913

Less tfeposa made {2,278,463) conertt deposit balance + 650 fclT faken April 21

Total balance 977.430 positive msariE RCCL owes NBF

NATIONAL 81OFUELSLP CONFIDENTIAL DRAFT FOR DISCUSSION PURPOSES ONLY 4/19/2007

Case 1:07-cv-03353-JSR Document 1-2 Filed 04/26/2007 Page 20 of 20