MEMORANDUM
OF AGREEMENT

    

    


    
      Is
entered into between

    

    


    
      CLENERGEN PHILIPPINES CORPORATION,
a Philippine corporation organized under Philippine laws with office
address at Unit 311, The Annex, No. 24 Gen. Araneta Street, San Antonio Village,
Pasig City, Philippines, herein represented by its President, MR. ANTONIO A. GIMENEZ and
herein referred to as “CLENERGEN”.

      


    

    
      and

      


    

    
      NATIONAL POWER CORPORATION, a
Philippine government owned and controlled corporation organized and existing
under and by virtue of the laws of the Philippines, with principal office
address at Quezon Avenue corner BIR Road, Diliman, Quezon City, 1100
Philippines, herein represented by its President, MR. FROILAN A. TAMPINCO and
hereinafter referred to as “NPC”;

    

    


    
      On the
basis of the following premises

      


    

    
      Whereas,  Clenergen  signed
a Memorandum of Agreement  dated December 28, 2009 with National Power
Corporation  to undertake the feasibility studies for off-grid areas
covering  Romblon Islands, Kalinga and Apayao under a
Build-Operate-Own System;

      


    

    
      Whereas,  Clenergen
projects that in the medium and long term,  these designated
areas  will require a consolidated power need  of 10
MW  with  the Romblon cluster of islands needing at least 5
MW in the medium term;  Kalinga, 1.5MW; and the balance for Palawan
off-grid areas and others to be mutually decided upon between Clenergen and
NPC;

      


    

    
      Whereas, the NPC recognizes
that the projects relative to the 10MW power needs are in pursuance of NPC’s
off-grid power development plan and in the context of the Public-Private
Partnership (PPP) program of the government which aims to accelerate
development, financing, construction and operation of key infrastructure
projects and wherein, the government is willing to protect investors from
certain regulatory risks events and provide pertinent incentives, provided,
however, the projects undergo competitive bidding;

      


    

    
      Whereas, Clenergen in pursuit
of said projects, will consolidate the financial requirements of said areas
under a 10MW consolidated power delivery plan and will tap immediately
the global financial markets to take advantage of strong interests in
alternative energies from both institutional and private capital
investors;

    


    
      
         


      

      
        1

        
          

        

      

      
         


      

    


    
      Whereas, in pursuing such
capital markets,   NPC and Clenergen have agreed to conclude,
under a separate agreement and subject to existing laws, rules and
regulations,  a 10 MW Consolidated Power Purchase Agreement against
which foreign capital will be generated;

      


    

    
      Whereas, to make the
investment to said SPUG areas attractive and as part of the Consolidated PPA,
NPC will agree to provide and warrant sovereign risks cover under such agreement
as a safety net to investors in coordination with, and subject to the approval
of, appropriate government agencies;

      


    

    
      Whereas, it is the intent of
Clenergen to have said funds consolidated and drawn against individual Power
Purchase Agreements as they are concluded and executed;

      


    

    
      Whereas, Clenergen, in
submitting this proposal, has started to receive expressed capital commitments
for the Romblon initiative and a Clenergen – NPC Consolidated PPA will
facilitate these commitments, and that Clenergen will commit to the soonest
completion of the Feasibility Study, together with the National Power
Corporation, for said feasibility study to be endorsed by the Department of
Energy for consideration under the PPP Framework;

      


    

    
       Whereas,  this
direction is consistent with the new  government direction calling for
a joint government-private sector partnership in the power infrastructure area
and encourages the Philippine government to create new vehicles of partnership
with the private sector to induce fresh capital in the power
sector;

      


    

    
      Now,
therefore, for
and in consideration of the foregoing premises, NPC and Clenergen have
agreed as follows

    

    


    
      Article
1 - Execution

      


    

    
      Both
sides shall utilize the Joint Technical Working Group (JTWG) under the existing
NPC-Clenergen MOA   to organize the detailed terms of reference
of this proposal.  Both sides agree to come up with an execution plan
within 15 days from the signing of this Agreement.

      


    

    
      For
purposes of this Agreement:

      


    

    
      
        	
              	
                a)

              	
                Clenergen
      shall raise competitive foreign capital  to finance its 10MW
      mandated power generation program  with NPC under
      BOO;

              


      

       

    

    
      
        	
              	
                b)

              	
                Said  Funds
      shall be generated  against a consolidated  Power
      Purchase Agreement between NPC and
Clenergen;

              


      

      

        
          
             


          

          
            2

            
              

            

          

          
             


          

        

      

    

    
      
        	
              	
                c)

              	
                Said  Funds
      shall be generated in advance,  shall
      be  operated as
      a
      standby, revolving funds, and shall be tapped as projects mature
      and ready for commercialization under the Consolidated
  PPA;

              


      

       

    

    
      
        	
              	
                d)

              	
                Said
      Funds shall be secured by NPC, subject to the approval of the appropriate
      government agencies, against political risks and provided with sovereign
      warranties as a safety net for investors’
  protection.

              


      

       

    

    
      
        	
              	
                e)

              	
                Said
      Funds will be organized and managed by
      Clenergen in support of its BOO commitment under NPC’s
    SPUG.

              


      

       

    

    
      Article
2 - Role of Parties

      


    

    
      To
facilitate the work on both sides, the responsibilities have been divided as
follows:

      


    

    
      
        	
              	
                a)

              	
                Role of
      Clenergen

              


      

       

    

    
      
        	
              	
                1)

              	
                Take
      the lead in submitting proposed Consolidated Power Purchase Agreement to
      NPC covering a 10 MW program within 90 days from signing of this
      MOA;

              


      

    

    
      
        	
              	
                2)

              	
                Submit
      the detailed financial and management plan for consideration by NPC and in
      coordination with other relevant Philippine government
      agencies;

              


      

    

    
      
        	
              	
                3)

              	
                Be
      responsible for organizing  financial instruments to raise
      capital for this program;

              


      

    

    
      
        	
              	
                4)

              	
                In
      coordination with NPC, organize market-driven activities  to
      promote funding including relevant foreign road shows to generate capital
      and interests on the SPUG
projects;

              


      

    

    
      
        	
              	
                5)

              	
                Develop  financial
      models  to validate project assumptions and ensure
      sustainability;

              


      

    

    
      
        	
              	
                6)

              	
                Ensure
      competitiveness of capital generated for this
  project;

              


      

    

    
      
        	
              	
                7)

              	
                Submit
      regular reports on the status of the
program;

              


      

    

    
      
        	
              	
                8)

              	
                Undertake
      such tasks as necessary to facilitate this
  program

              


      

    

    
       

    

    
      
        	
              	
                b)

              	
                Role of
      NPC

              


      

       

    

    
      
        	
              	
                1)

              	
                Conclude
      with Clenergen the a Consolidated Power Purchase Agreement, within a
      reasonable amount of time after the receipt of the proposed Consolidated
      PPA from Clenergen as provided in Article 2, Section a(1) above and
      subject to ERC approval,;

              


      

    

    
      
        	
              	
                2)

              	
                Promote,
      coordinate and secure the necessary approvals for the Agreement among
      relevant Philippine government
agencies;

              


      

    

    
      
        	
              	
                3)

              	
                Provide
      relevant technical, financial, logistical and administrative information
      as necessary to facilitate the
      project;

              


      

    

    
      
        	
              	
                4)

              	
                Create
      a dedicated financial team within NPC to facilitate and monitor the
      project, as necessary;

              


      

    


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


    
      
        	
              	
                5)

              	
                Participate
      in the promotional aspects of the project including  Investor
      Road Shows created for this
purpose;

              


      

    

    
      
        	
              	
                6)

              	
                Facilitate
      and conclude political and sovereign risk  cover under an
      expressed agreement for this
purpose;

              


      

    

    
      
        	
              	
                7)

              	
                Use
      the JTWG as continuing project development forum between NPC and
      Clenergen;

              


      

    

    
      
        	
              	
                8)

              	
                Undertake
      such tasks as necessary to promote the
project.

              


      

    

    
       

    

    
      Article
3 - Non Disclosure Agreement

      


    

    
      The
previously agreed Non-Disclosure Agreement signed December 28, 2009 forms part
of this Agreement.

    

    


    
      Article
4 - Settlement of Disputes

      


    

    
      The
Parties shall settle their differences amicably in the interest of the
project.  In case the Parties cannot settle their differences
amicably, the Parties will pursue Arbitration procedure and related governing
laws of the Philippines.  Arbitration venue shall be in the
Philippines.


    

    
      


    

    
      Article
5 - Special Efforts

    

    
      


    

    
      The Parties shall take
special efforts, using their respective resources, to give this agreement
special priority and attention including observance of timelines to facilitate
the objectives of this MOA.   Likewise, both parties shall consider,
towards the long term scenario, the partnering arrangement through the
Public-Private Partnership Guidelines of the Philippine government and to
prepare business plans
required
under this
program.

    

    
      


    

    
      Article
6 – Additional Agreements

    

    
      


    

    
      The
Parties shall enter into relevant agreements in pursuance of this MOA but in the
context of this agreement.


    

    
      


    

    
      Article
5 - Effectivity

      


    

    
       This
MOA shall take effect upon  signing hereof and shall continue to be in
effect for one (1) year, unless terminated by either Party upon ten (10) days
written notice to the other.


    


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


    
      Signed  7th day of
December 2010

    

    


    
      	
              CLENERGEN
      PHILIPPINES CORPORATION

            	
              NATIONAL
      POWER CORPORATION

            
	 
      	 
      
	
              By:

            	
              By:

            
	 
      	 
      
	
              /s/Antonio A. Gimenez

            	 
      	
              /s/Froilan A. Tampinco

            	 
      
	
              ANTONIO
      A. GIMENEZ

            	
              FROILAN
      A. TAMPINCO

            
	
              President

            	
              President

            


    

    
      


    

    
      WITNESSED
BY

      


    

    
      
        
          
            
              	
                      /s/Miguel
Patolot

                    


            

          

        

      

    

     

    MIGUEL
PATOLOT

    Non
Executive Chairman

    Clenergen
Philippines Corporation

    


    
      
        
          	
                  /s/Mark LM
Quinn

                


        

      

    

    
      MARK
LM QUINN

    

    
      Executive
Chairman

    

    
      Clenergen
Corporation US

    

    
       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

    

    
      ACKNOWLEDGMENT

    

    


    
      	
              Republic of the Philippine

            	
              )

            
	
              City of _________________  

            	
              ) S.S.

            


    

    
       

    

    
      BEFORE ME, a Notary Public in and for
City of ______________, Philippines, this ____________ 2010, personally
appeared:

      


    

    
      
        
          
            	
                    
                      Name

                    

                  	
                    
                      Identification Document

                    

                    
                      Presented

                    

                  	
                    
                      Date and Place of Issue

                    

                  
	
                    
                      ANTONIO
      A. GIMENEZ

                    

                  	 
      	 
      
	
                    
                      FROILAN
      A. TAMPINCO

                    

                  	 
      	 
      


          

        

      

    

    
       

    

    
      known to
me and to me known to be the same person who executed the foregoing Memorandum
of Agreement and acknowledged to me that the same is his free and voluntary act
and deed as well as that of the Corporation he represents.

    

    
      


    

    
      This
Memorandum of Agreement consists of six (6) pages including this page on which
the Acknowledgment is written, signed by the parties and their instrumental
witnesses on the signature page, and sealed with my notarial
seal.

    

    
      


    

    
      IN TESTIMONY WHEREOF, I have hereunto
set my hand and affixed my notarial seal on the date and at the place first
above written.

      


    

    
      	 
      	
              NOTARY
      PUBLIC

            
	 
      	
              Until
      December 31, 20__

            
	 
      	
              PTR
      NO. ______________

            


    

    
       

    

    
      Doc. No.
_______;

    

    
      Page No.
_______;

    

    
      Book No.
_______;

    

    
      Series of
2010.

    


    
      
         


      

      
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