ex10_2.htm


    
      	
               

            	
              EXHIBIT 10.2

            	
               

            


    


    MEMBERSHIP INTEREST REDEMPTION
AGREEMENT


     

    This Membership Interest Redemption Agreement
(the “Agreement”) is entered into and shall be effective as of December 15, 2008
(the “Effective Date”), by and between, U.S. BioFuels Exchange, LLC, a Colorado
limited liability company (the “Company”) and Diamond I, Inc., a Delaware
corporation (hereinafter as “DMOI”). DMOI and the Company are sometimes referred
to individually as a “Party” and collectively as the “Parties.”


     

    INTRODUCTION

     

    Whereas, DMOI holds 600 Interests as defined in
the Operating Agreement of the Company; and

     

    Whereas, the Parties have agreed that a portion
of DMOI’s right, title, and interest in the Company shall be redeemed by the
Company as set forth herein; and

     

    Whereas, the Parties have agreed that after
giving effect to the additional Interests to be issued as of the Effective Date
by the Company as authorized by the Board of Directors on December 11, 2008,
DMOI’s Sharing Ratio shall be equal to no less 14% immediately after the Company
redeems a portion of DMOI’s Interests as set forth in this Agreement; and

     

    Whereas, DMOI has made capital contributions to
the Company in the form of the issuance of DMOI stock to Shaji Parol for the
payment of services to develop certain intellectual property owned by the
Company; and

     

    Whereas, the Parties want to clarify each
Party’s respective rights and ownership interests in the intellectual and other
intangible property developed for and on behalf of the Company; and

     

    Now therefore, based on the foregoing, and in
consideration of the mutual agreements, covenants, and conditions contained
herein, and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the Parties hereby agree as follows:

     

    SECTION 1. Redemption. DMOI hereby sells,
assigns, and transfers 438 of its Interests (the “Redeemed Interest”) to the
Company as of the Effective Date. The Parties agree that as of the close of
business on the Effective Date that the Interests issued and the Sharing Ratios
of the Company shall be as set forth in Exhibit A, which is attached hereto and
incorporated by reference.

     

    SECTION 2. Consideration for Redeemed Interest.
In consideration for the redemption of the Redeemed Interest, the Company has
distributed to DMOI cash in the amount of $30,000. The consideration provided
for in this Section 2. is the total consideration payable by the Company to DMOI
for the Redeemed Interest.

     

    SECTION 3. Intellectual Property. DMOI hereby
waives and releases any and all claims it may have to the intellectual and other
intangible property developed for and on behalf of the Company, including, but
not limited to, all property developed as a result on the services performed by
Shaji Parol and James Kaufman. To the extent that DMOI has any ownership
interests or rights in the property described in the preceding sentence, DMOI
hereby assigns, transfers, grants and conveys such ownership interests and
rights to the Company.

     

    SECTION 4. Tax Matters. The Parties agree
that:

     

    (a) DMOI’s distributive share of the Company’s
income, gain, loss, and deduction for the taxable year of the Company that
includes the Effective Date shall be determined on the basis of an interim
closing of the books of the Company as of the close of business on the December
14, 2008, and shall not be based upon a proration of such items for the entire
taxable year. DMOI shall not be allocated a distributive share of any Company
items for any subsequent year except to the extent such allocations are required
by or are consistent with the provisions of this Agreement.

     

    (b) The Parties shall each file all required
federal, state, and local income tax returns and related returns and reports in
a manner consistent with the foregoing provisions of this Section 4. In the
event a Party does not comply with the preceding sentence, the non-complying
Party shall indemnify and hold the other Parties wholly and completely harmless
from all cost, liability, and damage that such other Party may incur (including,
without limitation, incremental tax liabilities, legal fees, accounting fees,
and other expenses) as a consequence of such failure to comply.

     

    SECTION 5. Representations, Warranties, and
Covenants.

     

    (a) Of Each Party. The Company and DMOI each
hereby represents and warrants to and covenants to each other Party that:

     

    1) Neither the execution nor the delivery of
this Agreement, the incurrence of the obligations herein set forth, the
consummation of the transactions herein contemplated, nor the compliance with
the terms of this Agreement will conflict with, or result in a breach of, any of
the terms, conditions, or provisions of, or constitute a default under, any
bond, note, or other evidence or indebtedness or any contract, indenture,
mortgage, deed of


     

    trust, loan agreement, lease, or other
agreement or instrument to which such Party is a party or by which such Party
may be bound.

     

    2) Such Party has the right, power, legal
capacity, and authority to execute and enter into this Agreement and to execute
all other documents and perform all other acts as may be necessary in connection
with the performance of this Agreement.

     

    3) No approval or consent not heretofore
obtained by any person or entity is necessary in connection with the execution
of this Agreement by such Party or the performance of such Party’s obligations
under this Agreement.

     

    4) Such Party has received independent tax and
legal advice from accountants and attorneys of their choice with respect to the
advisability of executing this Agreement.

     

    5) Except as expressly provided herein, no
person has made any statement or representation to such Party regarding any fact
relied upon by such Party in entering into this Agreement and each Party
specifically does not rely upon any statement, representation, or promise of any
other person in executing this Agreement.

     

    6) Such Party relies on the finality of this
Agreement as a material factor inducing its execution of this Agreement, and the
obligations under this Agreement.

     

    7) Such Party will not take any action which
would interfere with the performance of this Agreement by any other Party or
that would adversely affect any of the rights provided for herein.

     

    (b) Additional Representation, Warranty, and
Covenant of DMOI. DMOI hereby represents and warrants to and covenants to the
Company that DMOI owns the Redeemed Interest free and clear of any and all
liens, claims, encumbrances, and adverse equities.

     

    SECTION 6. Miscellaneous.

     

    (a) Severability. Each provision of this
Agreement is intended to be severable. If any term or provision hereof is
illegal or invalid for any reason whatsoever, such illegality or invalidity
shall not affect the legality or validity of the remainder of the
Agreement.

     

    (b) Survival. All of the terms,
representations, warranties, and other provisions of this Agreement shall
survive and remain in effect after the Effective Date.

     

    (c) Execution of Documents. Each Party agrees
to execute all documents necessary to carry out the purpose of this Agreement
and to cooperate with each other for the expeditious filing of any and all
documents and the fulfillment of the terms of this Agreement.

     

    (d) Binding Effect. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.

     

    (e) Construction. Every covenant, term, and
provision of this Agreement shall be construed simply according to its fair
meaning and not strictly for or against any Party. Capitalized terms not
otherwise defined in this Agreement shall have the same meaning as provided in
the Operating Agreement of the Company as the same is in effect as of the
Effective Date.

     

    (f) Headings. Section and other headings
contained in this Agreement are for reference purposes only and are not intended
to describe, interpret, define, or limit the scope, extent, or intent of this
Agreement or any provision hereof.

     

    (g) Entire Agreement. This Agreement contains
the entire understanding among the Parties and supersedes any prior written or
oral agreements between them respecting the subject matter of this Agreement.
There are no representations, agreements, arrangements, or understandings, oral
or written, between the Parties relating to the subject matter of this Agreement
that are not fully set forth herein.

     

    (h) Counterparts. This Agreement may be signed
in any number of counterparts, each of which shall be an original and, when
taken together, shall constitute one agreement.

     

    (i) Consent to Jurisdiction. Seller and
Purchaser each (i) irrevocably submits to the jurisdiction of any court sitting
in Denver County, Colorado for any action arising out of this Agreement, (ii)
agrees that all claims in such action may be decided in such court, (iii)
waives, to the fullest extent it may effectively do so, the defense of an
inconvenient forum, and (iv) consents to the service of process by mail. A final
judgment in any such action shall be conclusive and may be enforced in other
jurisdictions. Nothing herein shall affect the right of any party to serve legal
process in any manner permitted by law or shall affect its right to bring any
action in any other court.

     

    (j) Governing Law. This Agreement shall be
governed by, and construed in accordance with, the laws of the State of
Colorado, regardless of the law that might otherwise govern under applicable
principles of conflict of laws thereof.

     

    IN WITNESS WHEREOF, the Parties hereto have
approved and executed this Agreement as of the date first set forth
above.


     

    U.S. BioFuels Exchange, LLC

     

    /s/ Thomas J. Gray

     

    THOMAS J. GRAY, President



     

    DIAMOND I, INC.

     

    /s/ David Loflin

     

    DAVID LOFLIN, President