sulphco_s3-ex0409.htm


    EXHIBIT
      4.9


    MASTER
      SERVICES AGREEMENT

     

    THIS
      AGREEMENT, made and entered into effective this, 29
      day of
      March, 2006, by and
      between SULPHCO,
      INC., a
      Nevada
      corporation having an office and place of business at 850
      Spice
      Islands Drive, Sparks, NV 89431, hereinafter referred to as "OWNER", and
MUSTANG
      INTERNATIONAL, L.P., a
      Texas
      limited partnership having principal offices at 16001
      Park Ten Place, Houston, Texas 77084, hereinafter referred to as
      "CONTRACTOR".

     

    WITNESSETH
      THAT:

     

    WHEREAS,
      OWNER desires to have CONTRACTOR provide program management, engineering,
      procurement, construction management and other services, hereinafter referred
      to
as
      the
      "Work" in connection with the installation of new facilities or the modification
      of existing facilities,
      and

     

    WHEREAS,
      CONTRACTOR has the resources, technically competent personnel and the
      desire to undertake the Work, and

     

    WHEREAS,
      the parties hereto desire that the Work be performed on the basis of the
reimbursable
      terms provided herein,

     

    NOW
      THEREFORE, OWNER and CONTRACTOR, for and in consideration of the mutual
      covenants and agreements herein contained, agree as follows;

     

    ARTICLE
      1. DEFINITION OF THE WORK

     

     1.1    
The
      Work to
      be provided by CONTRACTOR under this Agreement shall consist of services
      such as program management, engineering, procurement, construction management
      and other services to the extent mutually agreed upon by OWNER and CONTRACTOR.
      Procurement services, if any, shall be by CONTRACTOR as agent, acting
      for and on behalf of OWNER; construction management services, if any, shall
      consist
      of overall technical management of construction, and shall also be performed
      as
agent
      of
      OWNER.

     

    1.2      
      For each separate assignment to be included under the provisions of this
      Agreement, a definition
      of the scope of Work and fee structure involved, hereinafter referred to as
      a
"Work
      Release" shall be determined to the mutual satisfaction of both parties.
CONTRACTOR
      shall advise OWNER of its anticipated schedule for execution of the Work
      and
      shall present to OWNER its estimate of Reimbursable Costs, as hereinafter
defined,
      to be incurred in performance of the Work.

     

    1.3      
      All
      Work
      shall be performed in accordance with this Agreement and the applicable
      Work Release.
      In the event of conflict among any of the Work Release documents, the document
      bearing the latest date shall govern. In the event of conflict between the
      Articles
      of this Agreement and any of the Work Releases, the Articles of this Agreement
      shall
      govern.

    


    
      
        
        

      

      
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    ARTICLE
      2. TIME OF PERFORMANCE

     

    CONTRACTOR
      shall initiate Work immediately upon notice by OWNER to do so and shall exert
      all
      reasonable efforts to complete same by the date mutually agreed
      upon.

     

    ARTICLE
      3. COMPLETION OF WORK

     

    Upon
      completion of the Work, CONTRACTOR shall notify OWNER in writing that the Work
      is complete. OWNER shall, within ten (10) working days after receipt of such
      notice, confirm in writing
      to CONTRACTOR that the Work is complete or notify CONTRACTOR of the respects
      in
which
      the
      Work is not complete. CONTRACTOR shall then immediately take the necessary
      steps
      to
      accomplish the incomplete aspects of the Work brought to its attention by OWNER;
      upon
      the
      conclusion of which, OWNER shall issue to CONTRACTOR a notice of completion
      of
Work.
      Failure to notify CONTRACTOR within the aforementioned ten (10) day period
      shall
      be deemed
      acceptance by OWNER of the completed Work. CONTRACTOR'S warranty obligations
      under ARTICLE 10 - RESPONSIBILITY OF CONTRACTOR hereof shall commence
upon
      completion and acceptance of the Work.

     

    ARTICLE
      4. COMPENSATION TO CONTRACTOR

     

    Except
      as
      otherwise agreed to in writing by both parties, OWNER shall, as provided in
      the
Schedule
      of Rates attached to each Work Release, reimburse CONTRACTOR for all manhours,
      costs,
      expenses and charges incurred by CONTRACTOR in the execution of the Work,
hereinafter
      referred to as "Reimbursable Costs".

     

    ARTICLE
      5. INVOICING AND PAYMENT

     

    5.1     
Except
      as otherwise provided in applicable Work Releases, CONTRACTOR shall invoice
      OWNER on a semi-monthly basis for all Reimbursable Costs incurred by
CONTRACTOR
      during the prior period. OWNER shall pay the full amount of such invoices
      within fifteen (15) calendar days of receipt thereof. Any delinquent payment
      shall
      earn interest at the rate of one percent (1%) per month until paid, but not
      to
      exceed the
      maximum contract rate permitted by the applicable usury laws in the state where
      the Work
      is
      performed.

     

    5.2      
      The existence of minor errors or inconsistencies in any of CONTRACTOR'S invoices
      shall
      not
      be cause for delay of payment. OWNER shall inform CONTRACTOR of such
errors
      or
      inconsistencies and CONTRACTOR shall correct same on its next invoice by
credit
      or
      debit to OWNER.

     

    5.3      
      OWNER shall make prompt payments to third parties upon receipt of invoices
      for
      any purchases
      made or work authorized by CONTRACTOR as agent for OWNER pursuant to
      Section 1.1 of ARTICLE 1 - DEFINITION OF THE WORK hereof, it being understood
      and
      agreed that payments under purchase orders or contracts/subcontracts entered
      ii
      o by
      CONTRACTOR as agent for OWNER are the sole responsibility of OWNER.

     

    
      
        
        

      

      
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    ARTICLE
      6. TERMINATION

     

    OWNER
      shall have the right to terminate the Work at any time upon written notice
      to
CONTRACTOR.
      In the event of such termination, OWNER shall pay CONTRACTOR'S Reimbursable
      Costs incurred through the effective date of termination, plus any such payments
      due CONTRACTOR subsequent to that date in effecting orderly
      termination.

     

    ARTICLE
      7. RIGHT TO AUDIT

     

    All
      of
      CONTRACTOR'S Reimbursable Cost records shall be subject to OWNER'S audit in
      CONTRACTOR'S
      offices at any time during regular business hours and upon reasonable
notice.
      The makeup of CONTRACTOR'S fixed or percentage rates and standard allowances
      shall
      be
      exempt from audit. CONTRACTOR shall maintain a true and correct set of records
      pertaining
      to Work performed hereunder and all transactions related thereto for a period
      of
      two (2)
      years
      after completion or termination of the Work.

     

    ARTICLE
      8. CONFIDENTIAL INFORMATION and COMMUNICATIONS

     

     8.1     
      CONTRACTOR shall treat as confidential all information furnished by OWNER which
      OWNER
      identifies as being confidential and shall return to OWNER, upon completion
      or
termination
      of the Work or upon written notice by OWNER, all such information. Confidential
      information furnished by OWNER shall not be disclosed by CONTRACTOR or any
      of
      its employees to any third party without the prior written consent of OWNER
      except
      as
      may be necessary in the performance of the Work. CONTRACTOR shall agree
      not
      to use said confidential information furnished it by OWNER except in
connection
      with the Work. The foregoing obligations shall not apply to information
      that:

     

    8.1.1    is
      or becomes
      available to the public through sources independent of or through no
      fault
      of CONTRACTOR, or

    8.1.2    is
      in
      CONTRACTOR'S possession prior to the receipt of information from OWNER,

    or

    8.1.3    is
      received
      by CONTRACTOR from a third party who has the right to disclose same,
      or

    8.1.4    is
      independently developed by CONTRACTOR without the use or benefit of OWNER'S
      information.

     

     8.2     
      CONTRACTOR'S obligations under this ARTICLE 8 with respect to any individual
      item of
      confidential information shall remain in effect for a period of three (3) years
      after receipt by CONTRACTOR of same.

     

    ARTICLE
      9. PATENT RIGHTS AND PATENT INDEMNITY

     

    9.1    If
      any
      inventions are made by CONTRACTOR or its employees in the performance of
the
      Work,
      or result therefrom before one (1) year after the expiration of this Agreement,
      CONTRACTOR
      shall promptly disclose same to OWNER and hereby grants to OWNER a
      non-exclusive, non-transferable, royalty free, irrevocable license under any
      and
      all patents
      which may be obtained for such inventions.

     

    
      
        
        

      

      
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    9.2    OWNER
      shall
      be responsible for dealing with all claims of patent infringement related to
      processes
      or information supplied by OWNER, and shall indemnify and save CONTRACTOR
      harmless from and against any claims of infringement relating thereto.
CONTRACTOR
      shall be responsible for dealing with all claims of patent infringement related
      solely to designs or methods supplied by CONTRACTOR, and shall indemnify
and
      save
      OWNER harmless from and against any claim of infringement relating
      thereto.

     

    ARTICLE
      10. RESPONSIBILITY OF CONTRACTOR

     

    10.1   CONTRACTOR
      warrants
      that it will perform its Work in accordance with the standards of care
      and
      diligence normally practiced by recognized engineering firms in performing
      services
      of a similar nature. If, during the one (1) year period following completion
      or
termination
      of CONTRACTOR'S Work, it is shown that these standards have not been
met,
      and
      OWNER has promptly notified CONTRACTOR in writing of such failure, CONTRACTOR
      shall perform, at its cost, such corrective services as may be necessary
within
      the original scope of its services to remedy such deficiency. This remedial
      obligation shall constitute CONTRACTOR'S sole liability and OWNER'S exclusive
      remedy
      with respect to CONTRACTOR'S Work and the activities (including engineering
      liaison
      and construction management in the field) involved in its performance,
irrespective
      of CONTRACTOR'S fault or negligence. When performing procurement services
      CONTRACTOR shall acquire the best available vendor and contractor warranties
      on behalf of Owner, but shall not itself have any liability with respect to
      materials
      or equipment purchased or fabricated. With respect to
      program
      and construction
      management, CONTRACTOR shall not responsible or liable for the ultimate
performance,
      nonperformance or malperformance (including default) of any the OWNER'S
      other contractors.

     

    10.2   In
      the event
      Contractor personnel are seconded to Company, this 10.2 shall govern such
assignment.
      CONTRACTOR shall use all reasonable efforts to ensure that CONTRACTOR
      personnel seconded to OWNER have the qualifications and experience levels
      specified by OWNER. Prior to being seconded to OWNER, CONTRACTOR personnel
      shall be informed as to the type of services which they will be expected to
      provide.
      Since CONTRACTOR personnel will work under the direction, supervision and
control
      of OWNER, CONTRACTOR does not warrant the quality of the services performed
      or results obtained. If any CONTRACTOR personnel seconded hereunder are
      unsatisfactory to OWNER then, upon written notice from the OWNER, CONTRACTOR
      shall, promptly remove such seconded personnel from OWNER'S assignment
      and use due diligence and its best efforts to provide a satisfactory
replacement
      to OWNER. All administrative costs associated with such removal of such
seconded
      personnel shall be borne by CONTRACTOR, provided always, however, that
all
      resulting out-of-pocket costs shall be borne by OWNER. The foregoing shall
      constitute
      CONTRACTOR'S sole responsibility and OWNER'S sole remedy with respect
to
      the
      qualitative performance of CONTRACTOR and its seconded personnel, irrespective
      of the fault or negligence of CONTRACTOR or its seconded personnel.

     

    ARTICLE
      11. FORCE MAJEURE

     

    If
      either
      party is rendered Linable, wholly or in part, by force majeure to carry out
      its
      obligations under
      this Agreement, other than OWNER'S obligation to make payments hereunder, that
      party shall
      give to the other party prompt written notice of the force majeure with
      reasonably full particulars
      concerning it. Thereupon the obligations of the party giving notice, so far
      as
      they are affected
      by the force majeure, shall be suspended during, but no longer than, the
      continuance of the
      force
      majeure. The affected party shall use all reasonable diligence to remove the
      force majeure
      as quickly as possible. The term "force majeure", as herein employed, shall
      without limitation,
      mean an act of God, strike, lockout, or other industrial disturbance, act of
      the
      public enemy,
      war, blockage, public riot, lightning, fire, storm, flood, explosion,
      governmental restraint, or
      any
      other cause, whether of the kind specifically enumerated above or otherwise,
      which is not reasonably
      within the control of the party claiming suspension. However, any additional
      costs incurred
      by CONTRACTOR as a result of force majeure shall be considered Reimbursable
      Costs.

     

    
      
        
        

      

      
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    ARTICLE
      12. INSURANCE AND RISK OF LOSS

     

    12.1    
CONTRACTOR
      shall maintain insurance of the types and limits as follows, and shall,
upon
      request, furnish certificates to OWNER evidencing such insurance and shall
      provide
      OWNER thirty (30) days' prior written notice of cancellation or any material
      change
      in
      the terms of the policies:

     

    12.1.1    
Workers'
      Compensation, Occupational Disease and Employer's Liability insurance
      covering employees engaged in performing the Work hereunder in accordance
      with the laws of the state in which CONTRACTOR may be required to
      pay
      compensation, with limits for Employer's Liability of $500,000 each accident.

     

    12.1.2     
      Comprehensive General Liability Insurance, including Broad Form Property
Damage
      and Blanket Contractual Liability, and Comprehensive Automobile Liability.
      This insurance shall cover bodily injury to or death of persons and/or
loss
      of
      or damage to property of parties other than OWNER. Such insurance shall
      be
      provided in a Combined Single Limit of $1,000,000 for any accident.

     

    12.2    
OWNER
      assumes responsibility for all loss of or damages to OWNER'S existing
property,
      howsoever such loss or damage shall occur, including the fault or negligence
      of
      either
      party, and for the cost of replacing the loss or repairing the damage to all
      materials,
      equipment and supplies purchased for permanent installation in or for use
during
      construction of the facilities.

     

    12.3     CONTRACTOR
      assumes responsibility for all loss of or damages to CONTRACTOR'S existing
      property, and for all personal injury (including death) to CONTRACTOR'S
employees,
      and releases and undertakes to defend OWNER against any liability with
respect
      thereto, irrespective of the fault or negligence of either party.

     

    ARTICLE
      13. CONSEQUENTIAL LOSS EXCLUSION 

     

    Neither
      party hereto shall be responsible or held liable to the other for punitive,
      indirect, incidental
      or consequential damages, including without limitation, liability for loss
      of
      use of any new
      facilities arising out of the Work or of any existing property, loss of profits,
      loss of product or business
      interruption however the same may be caused, including the fault or negligence
      of either
      party.

     

    
      
        
        

      

      
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    ARTICLE
      14. GOVERNING LAW AND ARBITRATION

     

    This
      Agreement shall be construed and the rights of the parties hereto shall be
      determined in accordance
      with the laws of the State of Nevada.

     

    Any
      controversy or claims arising out of or relating to the Agreement shall be
      initially submitted to
      mediation. The mediation team will be two senior executives of both
      organizations and a impartial third party facilitator suitable to both parties.
      The mediation team shall meet and attempt
      in good faith to resolve said claim or controversy.

     

    Any
      controversy or claim arising out of or relating to this Agreement, or the breach
      thereof, which
      cannot be resolved amicably by the mediation process described above, shall
      be
      settled by
      arbitration. This agreement to submit to arbitration shall be specifically
      enforceable under the
      prevailing arbitration law. The award of the arbitrator shall be final, and
      a
      judgment may be entered
      upon it by any court having jurisdiction. A party desiring to invoke this
      arbitration provision
      shall serve written notice upon the other of its intention to do so. Within
      thirty (30) days
      of
      the date of such notice, each party shall serve upon the other the name of
      one
      impartial individual,
      knowledgeable in matters pertaining to the engineering and construction
      industry, to serve as an arbitrator. A third arbitrator shall be designated
      within thirty (30) days thereafter by the
      two
      arbitrators.

     

    The
      arbitration shall be conducted in accordance with the Construction Industry
      Arbitration Rules
      of
      the American Arbitration Association then prevailing, and shall be conducted
      in
      Reno, Nevada
      unless the parties agree otherwise. Discovery shall be made available in
      accordance with
      the
      procedures set forth in the Federal Rules of Civil Procedure, but to a degree
      limited by the arbitrators as they deem appropriate to render the procedures
      economical, efficient, expeditious
      and fair. During the arbitration period, the parties shall continue to perform
      the obligations
      imposed upon them by this Agreement to the fullest extent possible, consistent
      with their
      positions with respect to the dispute.

     

    ARTICLE
      15. ASSIGNMENTS AND SUBCONTRACTS

     

    This
      Agreement shall not be assignable by either party without the prior written
      consent of the other
      party hereto, except that it may be assigned without such consent to the
      successor of either
      party or to a person, firm or corporation acquiring all or substantially all
      of
      the business and
      assets of such party. No assignment of this Agreement shall be valid until
      and
      unless this Agreement
      shall have been assumed by the assignee. When duly assigned in accordance with
      the
      foregoing, this Agreement shall be binding upon and shall inure to the benefit
      of the assignee.
      Notwithstanding the foregoing, CONTRACTOR, at its sole option, may subcontract
      any
      portion of the Work to any affiliate of CONTRACTOR. In no case shall any such
      subcontract
      relieve CONTRACTOR of any of its obligations under this Agreement; provided,
      however,
      that if portions of the Work are so subcontracted, this Agreement sets forth
      the
      overall aggregate
      liability of CONTRACTOR, all subsidiary or parent organizations, and all related
      entities
      of any subsidiary or parent organization with respect to the Work, irrespective
      of fault or negligence,
      and the exculpatory and liability-limiting provisions contained herein shall,
      regardless
      of the cause of action asserted, control and inure to the benefit of such
      affiliates as if they
      were
      direct signatories hereto.

     

    
      
        
        

      

      
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    ARTICLE
      16.
      OWNERSHIP
      OF DRAWINGS/KNOWN HOW

     

    Drawings
      and specifications prepared by CONTRACTOR pursuant to this Agreement (excluding
      CONTRACTOR'S
      pre-existing know how embodied therein) shall become the property of
CONTRACTOR.
      With respect to CONTRACTOR'S pre-existing know how embodied in any drawing
      or specification, OWNER agrees to use same solely for the purpose intended
      at
      the time
      of
      preparation and further agrees not to disclose same to others for purposes
      other
      than those
      intended, without the prior written consent of CONTRACTOR.

     

    ARTICLE
      17. EXCLUSIVITY

     

    CONTRACTOR
      agrees to only contract with OWNER on Sonocracking Projects in the petrochemical
      and chemical sectors This exclusivity period commences on the effective date
      of
this
      Agreement and will continue for a period of the earlier of one (1) year
      following termination of
      this
      Agreement or one (1) year following completion of a project hereunder, unless
      the parties agree
      otherwise. CONTRACTOR shall have first refusal rights on all Work Releases.
      If
CONTRACTOR
      declines to accept a Work Release hereunder, OWNER shall have the right to
      have
      work
      performed by others.

     

    ARTICLE
      18. KEY PERSONNEL

     

    The
      following classifications assigned to a project under this Agreement shall
      be
      designated as Key
      Personnel:

     

    Program
      Manager

    Project
      Manager

    Construction
      Manager

     

    OWNER
      shall have the right to accept or reject Key Personnel based on resume review
      and/or personal
      interview. OWNER agrees not to unreasonably withhold approval of Key Personnel.
      Furthermore,
      CONTRACTOR agrees not to remove Key Personnel from the Work without the
prior
      written approval of OWNER, such approval not to be unreasonably withheld.
Notwithstanding
      the foregoing, CONTRACTOR shall be allowed to remove Key Personnel in the
event
      of
      illness, termination, or the threat of termination by such personnel (whom
      CONTRACTOR
      desires to retain) unless reassigned from a project.

     

    ARTICLE
      19. PRESS RELEASES

     

    Neither
      party shall publish photographs or articles, give press releases or make
      speeches about, or otherwise publicize the existence of or scope of this
      Agreement or any generalities or details about the parties' facilities or
      business plans without first obtaining the other party's consent. This should
      not be construed to mean that a party cannot give information to others on
      a
      "need to know" basis in
      order
      to conduct its business under this Agreement in normal fashion; but the parties
      shall use prudence
      in giving such information and shall do so only after imposing on the recipients
      the requirement
      recited in the first sentence herein and the requirements of the Confidentiality
      Agreement
      or any other secrecy or confidentiality provision of the type described in
      Article 8 of
      this
      Agreement.

    


    
      
        
        

      

      
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      ARTICLE
        20. EXECUTIVE SPONSOR

    

     

    During
      the term of this Agreement, CONTRACTOR agrees to designate Mr. John Dalton
      as
      its Executive
      Sponsor for all projects performed hereunder. Mr. Dalton will remain Executive
      Sponsor
      unless agreed to otherwise in writing by the parties.

     

    ARTICLE
      21. ENTIRETY OF AGREEMENT

     

    This
      Agreement contains the entire contract, between the parties hereto, and there
      are no other promises,
      contracts or warranties affecting it, and all previous contracts and
      communications relative
      to the Work are hereof superseded. The headings in this Agreement shall not
      be,
deemed
      part hereof or taken into consideration in the, interpretations hereof. This
      Agreement may
      not
      be amended except by written instrument signed by both parties.

     

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed
      the date(s) appearing below, but effective the day and year first above
      written.

     

    
      	OWNER:	CONTRACTOR:
	 	 
	SULPHCO, INC.	MUSTANG INTERNATIONAL,
              L.P.
	 	 
	By: /s/ Rudolf Gunnerman	By: /s/ R.M. Farley
	 	 
	Name: Rudolf Gunnerman	Name: R.M. Farley
	 	 
	
              Title: Chairman & CEO

               

              Date: 3/29/2006

            	
              Title: Contracts Manager

               

              Date: 28 March
                2006

            


    

     

     

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