General Services Agreement between Aker Kvaerner E&C and W2 Energy, Inc.


    
      

    


    EXHIBIT
      10.4

    General
      Services Agreement between Aker Kvaerner E&C and W2 Energy,
      Inc.

    


    General
      Services Agreement

    


    This
      Agreement is made effective June 7, 2005 between W2 Energy Inc., ("Client"),
      and
      Aker Kvaerner E&C, a division of Aker Kvaerner Canada Inc. a company
      incorporated under the laws of Canada ("Aker
      Kvaerner").

    


    WHEREAS,
      Client
      has requested Aker Kvaerner to provide technical services (the "Services")
      in
      the ongoing development of the Sutton Biomass to GTL Plant (the “Project”);
      and

    


    WHEREAS,
      Aker
      Kvaerner has agreed to perform the Services in accordance with the terms of
      this
      Agreement;

    


    NOW
      THEREFORE, Client
      and Aker Kvaerner agree to be bound by the following terms and conditions of
      this Agreement:

    


    Article
      1 - The Services

    


    Aker
      Kvaerner shall perform the services specified in the Work Orders issued
      hereunder, and the Work Directives and Change Orders issued thereunder, if
      any
      (collectively, the "Services").

    


    Each
      Work
      Order, Work Directive, and Change Order shall be identical in form to that
      attached hereto as Exhibit A, Exhibit A-1, and Exhibit A-2,
      respectively.

    


    Aker
      Kvaerner shall not perform any services not authorized by a properly executed
      Work Order, or a Work Directive or Change Order issued thereunder.

    


    Article
      2 - Representatives

    


    Aker
      Kvaerner shall designate a commercial and a technical representative for each
      Work Order, who shall be identified in Section D of the Work Order.

    


    Aker
      Kvaerner’s commercial representative shall have authority to represent Aker
      Kvaerner in all matters pertaining to the Services performed under such Work
      Order and to make binding decisions on Aker Kvaerner's behalf. If Aker Kvaerner
      desires to replace either representative, Aker Kvaerner shall notify Client
      in
      writing of the proposed new representative and receive Client's written approval
      before making such replacement, which approval shall not be unreasonably
      withheld.

    


    Client
      shall designate a commercial and a technical representative for each Work Order,
      who shall be identified in Section D of the Work Order. Client’s commercial
      representative shall have authority to represent Client in all matters
      pertaining to the Services performed under such Work Order and to make binding
      decisions on Client's behalf. Client shall have the right to replace any
      representative by providing written notice to Aker Kvaerner.

    



    
      
         

      

      
        1

        
          

        

      

      
         

      

    


     

    Article
      3 - Work Directives and Change Orders

    


    Client
      may make or require changes, including additions and omissions, to the scope
      of
      the Services performed under any Work Order. The Client technical representative
      identified in a Work Order shall have authority to authorize changes to the
      scope of services in a total dollar amount not to exceed the lesser of CAD
      $10,000 or 10% of the estimated value stated in such Work Order.

    


    Such
      change shall be evidenced by a Work Directive, in the form attached hereto
      as
      Exhibit A-1, which shall be executed by both parties’ technical representatives
      prior to Aker Kvaerner performing any Services contemplated by the Work
      Directive.

    


    If
      a
      single change or the cumulative changes in the scope of services would exceed
      the Client technical representative’s authority (as stated in the preceding
      paragraph), a Change Order, in the form attached hereto as Exhibit A-2, shall
      be
      executed by both the commercial and technical representatives of both parties
      prior to Aker Kvaerner performing any Services contemplated by the Change
      Order.

    


    Aker
      Kvaerner shall not be entitled to any compensation, whether based in contract
      or
      quantum meruit, for services performed outside the scope of a Work Order in
      the
      absence of a Work Directive or Change Order, as appropriate.

    


    Article
      4 - Notices

    


    All
      notices and other required communications ("Notices") shall be in writing,
      and
      shall be sent to the addresses in the signature blocks set forth below, with
      a
      copy sent to the representatives identified in the applicable Work Order. A
      party may change its address by sending Notice to the other party of the new
      address.

    


    


    
      	
              If
                to Aker Kvaerner:

              Aker
                Kvaerner E&C

              Suite
                300, 480 University Avenue

              Toronto,
                Ontario

              M5G
                1V2

            	
              If
                to Client:

              W2
                Energy Inc.

              26
                Densley Ave.

              Toronto,
                Ontario

              M6M
                2R5

            


    

    
 

    Article
      5 - Confidentiality

    


    Client
      and Aker Kvaerner agree that all written information provided under this
      Agreement shall not be divulged to any third party without the written consent
      of the other party excluding, however, (i) information which is or properly
      becomes part of the public domain prior to disclosure, (ii) information which
      either party can show was in its possession prior to the execution of this
      Agreement or the commencement of the Services, or (iii) information disclosed
      by
      a third party through no fault of Client or Aker Kvaerner.

    


     


    
      
         

      

      
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    Article
      6 - Aker Kvaerner’s Responsibility

     

    Aker
      Kvaerner shall perform the Services in accordance with the care and skill
      ordinarily used by recognized engineering firms performing services of a similar
      nature under similar circumstances. Aker Kvaerner shall not be responsible
      for
      the acts or omissions of Client’s other contractors and subcontractors or any
      other persons performing Project related work. If, during the twelve (12) month
      period following completion of the Services, it is shown that Aker Kvaerner
      has
      failed to perform in accordance with the above standards, and Client has
      promptly notified Aker Kvaerner in writing of any such failure, Aker Kvaerner’s
      sole responsibility shall be to re-perform only those services determined
      mutually by Client and Aker Kvaerner as deficient. Such re-performance shall
      be
      at no cost to Client.

    


    Article
      7 - Client’s Responsibility

    


    To
      the
      extent reasonably required for Aker Kvaerner to perform the Services, Client
      shall

    promptly
      provide all information regarding the Project in its possession or in the
      possession of its subcontractors, employees or agents. Aker Kvaerner shall
      be
      entitled to rely on the accuracy of any such information.

    


    Article
      8 - Insurance

    


    Aker
      Kvaerner shall maintain in force during the period that the Services are
      performed under this Agreement, Workers' Compensation and Employer's Liability
      Insurance in the limit of $1,000,000 each occurrence or such other insurance
      as
      may be required by a government having jurisdiction over Aker Kvaerner’s
      employees who are engaged in providing the Services.

    


    Aker
      Kvaerner shall also maintain during such period Commercial General Liability
      (Bodily Injury and Property Damage) in the limit of $2,000,000 and Auto
      Liability including owned, nonowned and hired, in the combined limit of
      $1,000,000. Client expressly acknowledges that Aker Kvaerner’s insurance
      excludes coverage for damages, injury or harm of any kind whatsoever, to any
      person or real or tangible property, resulting from acts of terrorism. Client
      further agrees that Aker Kvaerner shall be held harmless and not liable for
      any
      such resulting damage, injury or harm.

    


    Article
      9 - Indemnity

    


    Aker
      Kvaerner shall indemnify Client against any and all claims, demands and causes
      of action for injury to or death of persons, or damage to or destruction of
      property, resulting solely from the negligent act or omission of Aker
      Kvaerner.

    


    Client
      agrees to indemnify, defend and hold harmless Aker Kvaerner, its employees,
      officers, directors, subsidiaries, parent, and affiliates from and against
      any
      claim, demand, and causes of action or liability resulting from any act or
      omission of Client. Client also agrees to indemnify, defend and hold harmless
      Aker Kvaerner, its employees, officers, directors, subsidiaries, parent, and
      affiliates from any claim, demand, cause of action or liability by or to any
      third party claiming reliance upon the Services or any product thereof. These
      indemnities survive the termination or conclusion of this
      Agreement.

    


     


    
      
         

      

      
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    Article
      10 - Limitation of Liability

     

    Aker
      Kvaerner's total aggregate liability to Client under each applicable Work Order,
      Work Directive, and Change Order for any reason or cause whatsoever, including,
      but not limited to, claims; demands; actual or threatened causes of action;
      unreasonable reliance upon work product; or any other reason not specifically
      mentioned herein, shall in no event exceed 10% of the total compensation paid
      to
      Aker Kvaerner under each applicable Work Order, Work Directive, and Change
      Order. Aker Kvaerner’s liability is further limited to the extent that Aker
      Kvaerner relies on information, documents, products, samples, engineering
      reports or designs provided by Client or Client’s subcontractors, employees,
      agents. These limitations shall survive the termination or conclusion of this
      Agreement.

    


    Article
      11 - Use of Studies

    


    The
      studies, deliverables or work product produced by Aker Kvaerner pursuant to
      this

    Agreement
      shall carry the Use of Report statement in Exhibit B or a statement
      substantially similar to that set forth in Exhibit B. All Services performed
      hereunder, and all work products or deliverables provided by Aker Kvaerner
      to
      Client are strictly subject to this disclaimer. The execution of this Agreement
      by the parties shall conclusively establish that the parties agree to be bound
      by the disclaimer.

    


    Article
      12 - No Consequential Damages

    


    Notwithstanding
      any other provision in this Agreement to the contrary, Aker Kvaerner shall
      not
      be liable in contract, tort, strict liability, warranty or otherwise, for any
      special, incidental or consequential damages or for any pollution or
      environmental damages, such as, but not limited to, delay, disruption, loss
      of
      product, loss of anticipated profits or revenue, loss of use of equipment or
      systems, non-operation or increased expense of operation of other equipment
      or
      systems, cost of capital, cost of purchased or replacement equipment, systems
      or
      power and cost of real estate. Aker Kvaerner's liability for services not in
      accordance with its responsibilities as set forth in Article 6 shall be limited
      to re-performance and is expressly subject to the limits stated herein. Aker
      Kvaerner shall not be liable for any other rework, including but not limited
      to
      reconstruction, equipment replacement or material re-supply. These limitations
      shall survive the termination or conclusion of this Agreement.

    


    Article
      13 - Exclusivity of Remedies

    


    The
      remedies set forth in this Agreement are exclusive remedies. Aker Kvaerner
      and
      Client agree to waive and hereby do waive all other remedies, whether in
      contract or tort, at law or in equity.

    


    Article
      14- Payment

    


    In
      consideration for performing the Services and for other conditions of this
      Agreement under the Work Orders, Work Directives, and Change Orders signed
      by
      the Client and Aker Kvaerner, Client shall pay Aker Kvaerner as defined and
      set
      forth in Exhibit C

    COMPENSATION
      to the Agreement.

    


     


    
      
         

      

      
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    Article
      15 - Ownership and Use of Documents

     

    Client
      shall retain title to and rights in all drawings, specifications, and reports
      produced by Aker Kvaerner. Aker Kvaerner is entitled to retain one set of all
      drawings, specifications, and reports for record purposes. Client shall not
      use
      such drawings, specifications, and reports except as intended in this
      Agreement.

    


    Article
      16 - Time of Performance

    


    Aker
      Kvaerner shall perform the Services as expeditiously as is consistent with
      professional skill and care and the orderly progress of the Services. The period
      of performance for each specific Work Order shall be set forth in that Work
      Order.

    


    Article
      17 - Use of Services

    


    The
      Services and any product thereof is for the sole benefit of Client and is not
      intended for the use or benefit of any third party. Aker Kvaerner makes no
      representations or warranties regarding the Services or any product thereof
      to
      any third party and no third party is an intended beneficiary of this Agreement.
      Reliance upon the Services or any product thereof by any third party is
      completely at the risk of such third party.

    


    Article
      18 - Assignment and Subcontracting

    


    Aker
      Kvaerner and Client bind themselves and their successors, assigns, and
      legal

    representatives
      to all of the covenants of this Agreement, and further agree that they shall
      not
      assign or transfer their interest in this Agreement without the prior written
      consent of the other.

    


    Article
      19 - Arbitration of Disputes

    


    If
      the
      parties become involved in a dispute arising in connection with, or in any
      manner related to, (1) the Project or any extension or modification thereof;
      (2)
      the Services performed under this Agreement; or, (3) the interpretation of
      this
      Agreement that cannot be settled by management or mediation, then the dispute
      will be settled by arbitration in accordance with the rules of the Arbitrators
      Institute of Canada, and judgment will be entered on the award. The arbitrator
      shall award attorneys' fees to the prevailing party. If a party after due notice
      fails to appear at and participate in the proceedings, the arbitrator shall
      make
      an award based on evidence presented by the party who does participate. Any
      arbitration shall take place in Toronto, Ontario, or such other place as the
      parties may agree.

    


    Article
      20 - Termination

    


    Upon
      thirty (30) business day’s written notice, Client may terminate this Agreement
      with or without cause. In the event of termination for any reason, Aker Kvaerner
      shall be paid the earned portion of the Contract Price as of the date of
      termination plus reasonable termination and settlement costs as agreed by the
      parties based on bilateral, good faith negotiations.

    


    Either
      party shall be entitled to terminate this Agreement on 30 days written notice
      to
      the other party in the event the other party is in substantial default of its
      obligations pursuant to this Agreement including payment default and such
      default has not been corrected or reasonably commenced to be corrected within
      30
      days following receipt of written notice of such default.


    
      
         

      

      
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    Article
      21 - Force Majeure

    


    Delays
      or
      failures of either party in the performance of its obligations hereunder, except
      those obligations relating to the payment of monies, shall be excused if caused
      by circumstances beyond the reasonable control of the party affected, including
      but not limited to, acts of God, labor strikes, fire, flood, windstorm,
      explosion, riot, war, sabotage, any act of terrorism, action or request of
      governmental authority, or accident, provided that reasonable notice of delay
      is
      given considering the totality of the circumstances. If such circumstances
      prevent the performance of Services for sixty (60) days, the Agreement shall
      be
      deemed to be terminated and the provisions of Article 20 shall
      apply.

    


    Article
      22 - Entirety of Agreement

    


    This
      Agreement and any Exhibits and other documents attached hereto constitute the
      entire agreement between the parties and incorporates all prior or
      contemporaneous agreements and understandings, whether such are oral or written,
      in connection with the subject matter hereof.

    


    This
      Agreement may be amended only in writing signed by the party against
      whom

    enforcement
      is sought.

    


    Article
      23 - Severability

    


    Whenever
      possible, each provision of this Agreement shall be interpreted in such a way
      as
      to be effective and valid under applicable law. If a provision is prohibited
      by
      or invalid under applicable law, it shall be ineffective only to the extent
      of
      such prohibition or invalidity, without invalidating the remainder of such
      provision or the remaining provisions of this Agreement. In case of such
      prohibition or invalidity, the remainder of this Agreement shall be interpreted
      to give as much meaning to the intent of the stricken portion or portions of
      the
      Agreement as allowed under applicable law.

    


    Article
      24 - Headings

    


    Article
      headings are for the convenience of the parties only and have no special
      significance, neither are they to be construed as part of this
      Agreement.

    


    Article
      25 - Waiver

    


    A
      failure
      or failures by either party to enforce any provision, term or condition of
      this
      Agreement shall not constitute a waiver of such provision, term or condition,
      nor shall it affect the enforceability of that provision, term or condition
      or
      of the remainder of this Agreement, neither shall any course of dealing of
      either party affect any such provision, term or condition in any way or the
      right of the parties at any time to avail themselves of any remedies accorded
      under this Agreement.


    
      
         

      

      
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    Article
      26 - Relationship

    


    The
      legal
      relationship of Aker Kvaerner to Client hereunder shall be that of an
      independent contractor and not that of an agent, employee or joint
      venturer.

    


    


    Article
      27 - Choice of Law

    


    This
      Agreement and any Exhibits and other documents attached hereto shall be governed
      by and interpreted in accordance with the laws and applicable regulations of
      the
      Province of Ontario, Canada.

    


    Article
      28 - Exhibits

    


    All
      Exhibits attached hereto or referenced herein (including but not limited to
      all
      Work Orders, Work Directives, and Change Orders executed by the parties hereto)
      are hereby incorporated into and made a part of this Agreement. The terms of
      this Agreement and its Exhibits are intended to be complementary and shall
      be
      interpreted and construed as complementary, whenever possible. In the event,
      however, of any contradiction, discrepancy, ambiguity, or inconsistency between
      the terms of this Agreement and the terms of any Exhibit, the parts of this
      Agreement shall have the following order of precedent:

    


    a.
      General Services Agreement Articles 1 to 28;

    


    b.
      Exhibit A, and within Exhibit A, part A, part B, part C, and then its other
      provisions; and

    


    c.
      Other
      Exhibits.

    


    IN
      WITNESS WHEREOF, the
      parties have executed this Agreement on the date first

    set
      forth
      above.

    


    



    Aker
      Kvaerner E&C 

    a
      division of Aker Kvaerner Canada Inc.

    By:_________________

    Name:
      ______________

    Title:
      _______________

    W2
Energy
      Inc. 

    


    By:__________________

    Name:_______________

    Title:
      ________________

    




    
      
         

      

      
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    Exhibit
      A

    GSA
      WORK ORDER

    General
      Services Agreement (XXXX)

    Work
      Order Number (XXXX-xx)

    


    Aker
      Kvaerner and Client are parties to the General Services Agreement referenced
      above (the "Agreement"). Capitalized terms used in this Work Order that are
      not
      defined herein shall have the meanings set forth in the Agreement.

    


    Client,
      pursuant to Article 1 of the Agreement, hereby requests Aker Kvaerner to
      perform

    certain
      Services, more specifically described below, and Aker Kvaerner hereby agrees
      to

    perform
      such Services, subject to the terms and conditions of the Agreement and this
      Work Order.

    


    Unless
      otherwise agreed in writing signed by both parties, any services performed
      by
      Aker Kvaerner or its subcontractors prior to the date this Work Order was
      executed and that falls within the Scope of Services set forth in Section A
      of
      this Work Order shall be deemed to have been performed subject to the terms
      and
      conditions of the Agreement, including but not limited to its Exhibits and
      this
      Work Order.

    


    The
      parties agree as follows:

    


    A.
      Scope of Services

    Aker
      Kvaerner shall provide the following Services:

    [Insert
      detailed description of the scope of Services being provided, including any
      deliverables]

    


    B.
      Period of Performance

    


    Services
      to be performed under this Work Order shall be commenced on ______ and shall
      be
      completed on or before _______. Aker Kvaerner agrees that this time schedule
      is
      reasonable.

    


    C.
      Compensation

    


    For
      Services performed in accordance with this Work Order and the Agreement, Aker
      Kvaerner shall be compensated as follows:

    [Insert
      compensation schedule (e.g., an hourly rate schedule), and terms for
      reimbursables]

    


    D.
      Representatives

    


    For
      purposes of this Work Order and in accordance with Article 2 of the Agreement,
      Client and Aker Kvaerner designate the following representatives:

    


    Client
      Commercial Representative:

    Address
      for Invoice Copies:

    Client
      Technical Representative:

    Aker
      Kvaerner Commercial

    Representative:

    Aker
      Kvaerner Technical Representative:


    
      
         

      

      
         

        
          

        

      

      
         

      

    


    IN
      NO
      EVENT SHALL THE COMPENSATION DUE AKER KVAERNER (WHICH INCLUDES ALLAMOUNTS
      PAYABLE UNDER SECTION C) UNDER THIS WORK ORDER EXCEED CAD $______________
      WITHOUT THE PRIOR EXPRESS WRITTEN CONSENT OF CLIENT’S COMMERCIAL REPRESENTATIVE.
      ANY WRITTEN AUTHORIZATION TO EXCEED THIS COMPENSATION CAP SHALL ESTABLISH A
      NEW
      AMOUNT.

    


    ACCEPTED
      AND AGREED TO this day of , 2005.

    


    



    Aker
      Kvaerner E&C 

    a
      division of Aker Kvaerner Canada Inc.

    By:
      

    Name:
      

    Title:
      

    W2
Energy
      Inc. 

    


    By:
      

    Name:
      

    Title:

    




    
      
         

      

      
         

        
          

        

      

      
         

      

    


    Exhibit
      A-1

    GSA
      WORK DIRECTIVE

    General
      Services Agreement (XXXX)

    Work
      Order Number (XXXX-xx)

    Work
      Directive Number (XXXX-xx)

    


    Client
      and Aker Kvaerner hereby agree to modify Work Order Number _____________ as
      follows. The Services performed under this Work Directive shall be subject
      to
      the terms and conditions of the General Services Agreement and Work Order Number
      ______________, except as herein expressly modified.

    


    A.
      Scope of Services.

    


    B.
      Period of Performance.

    


    C.
      Compensation.

    


    ACCEPTED
      AND AGREED TO this __________ day of _____________, 2005.

    


    



    Aker
      Kvaerner E&C 

    a
      division of Aker Kvaerner Canada Inc.

    By:
      

    Name:

    W2
Energy
      Inc.

    


    By:

    Name:
      

    




    
      
         

      

      
         

        
          

        

      

      
         

      

    


    Exhibit
      A-2

    GSA
      CHANGE ORDER

    General
      Services Agreement (XXXX)

    Work
      Order Number (XXXX-xx)

    Change
      Order Number (XXXX-xx)

    


    Client
      and Aker Kvaerner hereby agree to modify Work Order Number _____________ as
      follows. The Services performed under this Change Order shall be subject to
      the
      terms and conditions of the General Services Agreement and Work Order Number
      ______________, except as herein expressly modified.

    


    A.
      Scope of Services.

    


    B.
      Period of Performance.

    


    C.
      Compensation.

    


    ACCEPTED
      AND AGREED TO this __________ day of _____________, 2005.

    


    



    Aker
      Kvaerner E&C 

    a
      division of Aker Kvaerner Canada Inc.

    By:
      

    Name:

    Technical
      Representative Technical Representative

    W2
Energy
      Inc.

    


    By:

    Name:
      

    Commercial
      Representative Commercial Representative

    




    
      
         

      

      
         

        
          

        

      

      
         

      

    


    Exhibit
      B

    USE
      OF REPORT

    


    This
      report was prepared for W2 Energy Inc. (“Client”) by Aker Kvaerner E&C, A
      Division of Aker Kvaerner Canada Inc. ("Aker Kvaerner") pursuant to the contract
      agreement

    (“Agreement”)
      between the Client and Aker Kvaerner.

    


    The
      report is based in whole or in part on information and data provided to Aker
      Kvaerner by Client and/or third parties. Aker Kvaerner represents that it
      exercised reasonable care in the preparation of this report and that the report
      complies with published industry standards for such reports, to the extent
      such
      published industry standards exist and are applicable.

    


    However,
      Client agrees that, except to the extent specifically stated in writing in
      the
      Agreement, Aker Kvaerner is not responsible for confirming the accuracy of
      information and data supplied by Client or third parties and that Aker Kvaerner
      does not attest to or assume responsibility for the accuracy of such information
      or data. Aker Kvaerner also does not attest to or assume responsibility for
      the
      accuracy of any recommendations or opinions contained in this report or
      otherwise expressed by Aker Kvaerner or its employees or agents, which
      recommendations or opinions are based in whole or in part upon such information
      or data.

    


    The
      recommendations and opinions contained in this report assume that
      unknown,

    unforeseeable,
      or unavoidable events, which may adversely affect the cost,
      progress,

    scheduling
      or ultimate success of the Project, will not occur.

    


    Any
      discussion of legal issues contained in this report merely reflects technical
      analysis of Aker Kvaerner and does not constitute legal opinions or the advice
      of legal counsel.

    This
      report contains confidential and proprietary information and is furnished to
      Client solely for its use.

    


    Aker
      Kvaerner makes no representations, guarantees, or warranties except as expressly
      stated herein or in the Agreement and all other representations, guarantees,
      or
      warranties, whether express or implied, are specifically
      disclaimed.

    


    Except
      as
      may be expressly stated in writing in the Agreement, the use of this report
      or
      the information contained herein is at the users sole risk and Client
      specifically agrees to release, defend, indemnify and hold Aker Kvaerner, its
      affiliated companies, and its/their officers, directors, employees and agents
      harmless from any and all liability, damages, or losses of any type, including
      consequential and punitive damages, suffered by Client or any third party,
      even
      if such damages or losses are contributed to or caused by the sole or concurrent
      fault or negligence of Aker Kvaerner, its affiliated companies, or its/their
      officers, directors, employees, or agents; provided, however, such release,
      limitation and indemnity provisions shall be effective to, and only to, the
      maximum extent allowable by law.


    
      
         

      

      
         

        
          

        

      

      
         

      

    


    Exhibit
      C

    COMPENSATION

    C
      COMMERCIAL TERMS

    


    The
      following are the commercial terms for Aker Kvaerner services for execution
      of
      the Scope of Services defined in each applicable approved Work Order. The
      services will be executed on a cost-reimbursable basis. This offer is in
      accordance with the basis of compensation and payment terms as defined
      herein.

    


    C-1
      ESTIMATED COST OF SERVICES

    


    Aker
      Kvaerner will carry out services to assist the Client in the ongoing development
      of the Carbon Black Process and Facility Project. There is no defined scope
      of
      services at this time. The services will generally consist of assignments
      requested by the Client to assist in the development of the Carbon Black Process
      and Facility Project. Upon Client’s request to carry out specific assignments,
      Aker Kvaerner will submit a Work Order of the estimated number of man-hours
      and
      costs involved and obtain Client’s approval before proceeding with the
      services.

    


    C-2
      COMPENSATION TERMS

    As
      full
      compensation for the services, Aker Kvaerner will be paid the sum of labour
      billings and reimbursable expenses incurred.

    


    C-2.1
      Labour

    


    Compensation
      from the Client to Aker Kvaerner will be on the basis of all-inclusive hourly
      charge-out rates which allow for reimbursement of Aker Kvaerner’s
      services.

    


    C-2.2
      Direct Expenses

    


    Compensation
      from the Client to Aker Kvaerner for chargeable expenses incurred by Aker
      Kvaerner in the interests of the project and not provided for within the
      charge-out rates, such as travel and related costs including out-of-pocket
      disbursements, will be charged to the Client at Aker Kvaerner’s cost, plus an
      additional markup of 5% to cover administration services.

    


    C-3
      TERMS OF PAYMENT

    


    Client
      shall cause payment to be made in Canadian funds. Payment will be via direct
      deposit to:

    


    Royal
      Bank of Canada

    Main
      Branch Royal Centre

    1025
      West
      Georgia Street

    Vancouver,
      BC V6E 3N9

    Account
      No. 100-191-6

    Transit
      00010 Swift No. ROYCCAT2.

    


    



    
      
         

      

      
         

        
          

        

      

      
         

      

    


    C-3.1
      Monthly Advance Payment Billings for Services

    


    In
      order
      for Aker Kvaerner to maintain at least a cash-neutral position during execution
      of the services, we request that a system of advance billings be applied for
      the
      services, which Aker Kvaerner will provide. An initial monthly advance payment
      request will be issued to the Client upon award of each of the Work Orders
      covering the estimated cost of Aker Kvaerner’s services for work for the first
      month. Client shall pay the initial monthly advance payment amount before Aker
      Kvaerner starts the work.

    


    Subsequent
      advance payment requests for each Work Order will be issued by Aker Kvaerner
      on
      or about the 15th day of each month, covering the estimated cost for services
      to
      be provided for the following month. Client shall pay each of these monthly
      advance billings within ten (10) days after its receipt, and no later than
      the
      start of the month to which it applies.

    


    The
      last
      monthly advance payment request will be issued by Aker Kvaerner on or about
      the
      15th day of the second month prior to the scheduled completion date of the
      Work
      Order.

    


    C-3.2
      Monthly Billing for Services

    


    On
      or
      about the 15th day of each month, Aker Kvaerner shall furnish the Client with
      a
      detailed monthly progress invoice of all reimbursable costs associated with
      the
      work occurring during the previous month and chargeable to the Client for each
      Work Order. Each monthly progress invoice will be supported by one (1) copy
      each
      of Aker Kvaerner’s manhour report generated from its accounting system, Vendors’
invoices, expense reports, and any other documentation necessary to substantiate
      the reimbursable costs.

    


    The
      monthly progress billing includes a reconciliation that shows the difference
      between Aker Kvaerner’s actual reimbursable monthly costs and the applicable
      monthly advance payment amount invoiced to the Client. If the summary shows
      a
      net balance due Aker Kvaerner, Client shall pay the net balance amount within
      ten (10) days after its receipt. If the summary shows an advance balance, no
      payment will be required. Any balances made in this manner will be deducted
      against subsequent monthly advance payment requests.

    


    C-3.3
      Final Billing

    


    Upon
      completion of services for each Work Order, Aker Kvaerner will submit a final
      billing that will include a statement summarizing previous billings rendered
      and
      payments received. Within ten (10) days after receipt of the final billing,
      Client shall pay Aker Kvaerner all remaining amounts due.