Document:

fofu8k20110330ex10-2.htm

JOINT VENTURE AGREEMENT

This Agreement is made and entered into by and between Force Fuels, Inc., a Nevada Corporation, or a wholly owned subsidiary and PEMCO LLC, an Oklahoma Limited Liability Company, sometimes referred to as the parties.

RECITALS:

 WHEREAS, both parties agree to work together in the development of oil and gas leases located in Kansas and Oklahoma under the following terms;

AND WHEREAS, Force Fuels, inc. will use its best efforts to raise funds for the agreed to future development plans:

AND WHEREAS, PEMCO LLC, will use its best efforts to execute the agreed to future development plans,

NOW THEREFORE, each party hereby acknowledges and agrees as follows;

	
  

	
1.

	
Force Fuels, Inc. and PEMCO LLC each own 50% of the working interest in the four leases known as the Mann, Mann AB, Bayless, and Doe Brook described in Exhibit “A”.

	
  

	
2.

	
That the oil and gas production revenue generated from the four existing jointly owned leases will be divided equally between the two parties after operating expenses.

	
  

	
3.

	
That any new development to the four jointly owned leases will be funded by Forces Fuels, Inc. and the execution plan will be performed by PEMCO LLC.

	
  

	
4.

	
That revenue generated from the new development plan will be divided 75% to Force Fuels, Inc and 25% to PEMCO LLC. after the terms of the financing have been satisfied.

	
  

	
5.

	
That both parties will use their best efforts to develop the additional oil and gas leases currently in the Joint Venture plan listed as Ball, East Ball, Kelso, Moore, Smith, Bain, Clark, Thorne, and Pendleton.

	
  

	
6.

	
  That revenue generated from the new development plan for the nine additional leases will be divided 75% to Force Fuels, Inc and 25% to PEMCO LLC. after the terms of the financing have been satisfied.

	
  

	
7.

	
That both parties agree to further expand the development plans into Oklahoma under the general structure described in this agreement.

 

  

  

  

In witness whereof, the parties have executed this agreement the day and year set forth opposite their respective signatures below.

	  	
PEMCO, LLC

	  	  
	
Dated: __________________, 2011

	
By:                   /s/                        

	  	
Rick Coody, Member

	  	  
	  	  
	  	
Force Fuels, Inc.

	  	  
	
Dated: __________________, 2011

	
 
By:                   /s/                        

	  	
Thomas Hemingway, CEO and President/CEO

  

  

  

EXHIBIT “A”

	
LESSOR:

	
Dennis L. Bayless and Debora C. Bayless, husband and wife

	
LESSEE:

	
Pemco, LLC

	
DATE:

	
April 26, 2010

	
DESCRIPTION:

	
SW/4 SE/4 of Sec. 35, T33S, R13; N/2 NE/4 a/k/a Lots 1 & 2; SE/4 NE/4 of Sec. 2, T34S, R13E, all in Montgomery County, Kansas

	
RECORDED:

	
Book 590, Page 97

	  	  
	
LESSOR:

	
Dennis L. Bayless and Debora C. Bayless, husband and wife

	
LESSEE:

	
Pemco, LLC

	
DATE:

	
April 26, 2010

	
DESCRIPTION:

	
NW/4 NW/4 a/k/a Lot 4, Sec. 1, T34S, R13E, Montgomery County, Kansas

	
RECORDED:

	
Book 590, Page 98

	  	  
	
LESSOR:

	
Dennis L. Bayless and Debora C. Bayless, husband and wife

	
LESSEE:

	
Pemco, LLC

	
DATE:

	
April 26, 2010

	
DESCRIPTION:

	
S/2 SW/4 of Sec. 35, T33S, R13E, Montgomery County, Kansas

	
RECORDED:

	
Book 590, Page 99

	  	  
	
LESSOR:

	
Dennis L. Bayless and Debora C. Bayless, husband and wife

	
LESSEE:

	
Pemco, LLC

	
DATE:

	
April 26, 2010

	
DESCRIPTION:

	
NW/4 of Sec. 2, T34S, R13E, Montgomery County, Kansas

	
RECORDED:

	
Book 590, Page 100Exhibit 4.7

 

AMENDMENT TO THE

BALLY TECHNOLOGIES, INC.

2010 LONG TERM INCENTIVE PLAN

 

1.                                       That the first sentence of section 3 of the Bally Technologies, Inc. 2010 Long Term Incentive Plan (the “Plan”) is amended by replacing 12,050,000 with 15,050,000, so that the first sentence of section 3, as amended, reads in its entirety as follows:

 

“Limitation on Number of Shares. The number of shares which may be issued pursuant to all Awards granted under the Plan is limited to an aggregate of 15,050,000 shares of the common stock, $0.10 par value, of the Company (the “Stock”).”

 

2.                                       That a new sentence be added to section 3 of the Plan, immediately following the first sentence under the heading “Limitation on Number of Shares,” that reads in its entirety as follows:

 

“Solely with respect to Awards granted on or after the date of the 2010 Annual Meeting of Stockholders, any shares of Stock issued pursuant to Awards of Restricted Stock, Restricted Stock Units or Incentive Bonuses shall be counted against the limit in the preceding sentence as one and three-quarters (1.75) shares for every share granted.”

 

3.                                       That the second to last sentence of section 3 of the Plan under the heading “Limitation on Number of Shares” is amended by adding a proviso, so that the second to last sentence of section 3, as amended, reads in its entirety as follows:

 

“If any Option or Stock Appreciation Right granted under the Plan expires, terminates or is canceled for any reason without having been exercised in full, or any other Award is forfeited for any reason, the shares of Stock allocable to the unexercised portion of the Option or Stock Appreciation Right or to the forfeited portion of the Award may again be made subject to an Option or Award under the Plan; provided, however, that any shares of Stock subject to Awards granted on or after the date of the 2010 Annual Meeting of Stockholders that again become available for grant pursuant to this Section 3 shall be added back as one and three-quarters (1.75) shares if such shares were subject to Awards of Restricted Stock, Restricted Stock Units or Incentive Bonuses, and one (1) share if such shares were subject to any other Awards granted under the Plan.”

 

4.                                       That the fourth sentence of section 14 of the Plan shall be deleted in its entirety.Exhibit 4.7

 

No.: Zhong Lv Bao Di Zi 2010 [006-4]

 

Counter-Guarantee (Mortgage) Agreement

 

Mortgagor (Party A): Daqing Borun Biotechnology Co., Ltd.

 

Mortgagee (Party B): Zhong Lv Credit Guarantee Co., Ltd.

 

 

Counter-Guarantee (Mortgage/Pledge) Agreement

 

Mortgagor (Party A): Daqing Borun Biotechnology Co., Ltd.

 

Mortgagee (Party B): Zhong Lv Credit Guarantee Co., Ltd.

 

To secure the realization of the working capital loan of the leading enterprises in the agribusiness, equal to RMB 50 million, which is applied by Daqing Borun Biotechnology Co., Ltd. (“the Debtor”) with Daqing Branch of Agricultural Development Bank of China  (“the Creditor”) during the period from August 24, 2010 to August 23, 2011, and in the mean time to secure Party B’s exercise of right of recourse, as well as according to the “Entrustment Agreement on Guarantee” (No.:  Zhong Lv Wei Bao Zi 2010[006]) signed between the Debtor and Zhong Lv Credit Guarantee Co., Ltd., Party A is willing to provide a counter-guarantee (mortgage) to Party B, therefore, the Parties enter into this Counter-guarantee Agreement (“this Agreement”) via equal negotiations.

 

1.              Coverage of the (Mortgage) Counter-guarantee Provided by Party A

 

(1)          The counter-guarantee shall secure all the debts that Party B shall pay off on behalf of the Debtor (including the principal, interest, penalty interest, compound interest, damages, liquidated damages payable by the Debtor, the property mortgage expense, the expenses for realizing the Creditor’s rights, etc.) as well as the occupancy fee for the compensatory fund which is payable by the Debtor to Party B. The occupancy fee for the compensatory fund shall be calculated at 1‰/day of all the debts which are paid off by Party B on the Debtor’s behalf from the repayment date on the Debtor’s behalf.

 

(2)          The counter-guarantee shall secure all the liquidated damages, damages, attorney fees, guarantee fees and other fees payable by the Debtor to Party B under the “Entrustment Agreement on Guarantee”.

 

(3)          The counter-guarantee shall secure all the fees for realizing Party B’s mortgage right, including but not limited to the litigation fee, arbitration fee, property preservation fee, attorney fee, appraisal fee, auction fee, enforcement fee, agent fee, notarization fee, consultation fee, travel expenses, etc.

 

2.               Party A mortgages the properties which it has the right to dispose of.  The mortgaged properties are listed in the “List of Mortgaged Properties” attached herein, which is an integral part of this Agreement.

 

 

3.               Party A covenants that:

 

(1)          It has the legal ownership or disposal right to its mortgaged properties;

 

(2)          During the mortgage period, Party A shall well keep the mortgaged properties, shall be responsible for the repair and maintenance work, and shall ensure the mortgaged properties safe and sound.  If Party B requires learning about relevant information of the mortgaged properties, in which, Party A shall give full assistances.

 

(3)          From the effectiveness date of this Agreement, Party A shall deliver the title certificate of the following mortgaged properties to Party B for its keeping (unless otherwise provided by the law):

 

(a)          Thirteen house properties of the company, with total building areas of 23,502.94 square meters (see the “List of Mortgaged Properties”).

(b)                                  ;

(c)                                  ;

 

(4)          If Party B requires purchasing insurance for certain mortgaged properties, Party A shall handle and complete the insurance formalities before the effectiveness of this Agreement and shall ensure to renew the insurance policy upon the expiration.

 

(5)          Party A shall be responsible for handling the appraisal, notarization, insurance, authentication, registration, transportation, keeping and other relevant issues under this Agreement and bear all related fees.

 

4.               During the mortgage period, if Party A has any activity causing the value of the mortgaged properties decreases, Party A shall mortgage additional properties or additionally provide other effective guarantee to Party B which is/are equal to the decreased value within 15 days after the value of the mortgaged properties decreases.

 

5.               During the mortgage period, if mortgaged properties have any damage which is covered by the insurance, or if any third party has any activity causing the value of the mortgaged properties decreases, any insurance compensation or damages shall be used to prepay the loan principal or shall be deposited to Party B’s designated account.

 

6.               During the mortgage period, if Party A intends to lease the mortgaged properties, it shall obtain Party B’s written approval.

 

7.               During the mortgage period, upon Party B’s written approval, Party A may

 

 

transfer the mortgaged properties and the proceed therefrom shall be disposed of according to Option 1 as provided below:

 

(1)          Deposit it to Party B’s designated account and Party A shall not make use of it during the mortgage period;

(2)          Party A agrees to use it to prepay the loan upon.

 

8.               If Party A has any of the following events, it shall promptly notify Party B:

 

(1)          Its operation mode changes, such as implementing contracting, leasing, affiliation, merger (acquisition), split-up, shareholding reform, joint venture (cooperation) with foreign investment, etc.

(2)          Involve in litigations in connection with material economic disputes;

(3)          There is any dispute to the mortgaged right;

(4)          Bankruptcy, out of business, dissolution, being called for business suspension for rectification, with its business license or other licenses or qualification revoked or canceled;

(5)          There is any change to the legal representative, legal address and telephone number of the enterprise.

 

If any event provided in (1) above occurs, Party A shall notify Party B 30 days in advance; and for other events listed above, Party A shall notify Party B within 3 days after its occurrence.

 

9.               If Party A breaches Article 4, 5, 7 or 8 and causes damages to Party B, of which, Party A shall be liable for the compensation.

 

10.         If the loan is early recalled according to relevant provisions of the Loan Agreement signed between the Debtor and the Creditor (Bank), the creditor’s rights under the Loan Agreement are not fully realized and Party B has to repay the debts on the Debtor’s behalf, then Party B is entitled to early dispose of the mortgaged properties to recover its losses.

 

11.         Upon the expiration of the performance term under the Loan Agreement, if the Debtor fails to pay off all the debts and Party B has to repay the debts on the Debtor’s behalf, then Party B is entitled to realize its mortgage right and to get compensation by converting the mortgaged properties into money or seek preferential payments from the proceeds from the auction or sales of the mortgaged properties concerned.

 

12.       Effectiveness

 

(1)          This Agreement shall come into effect upon being signed and stamped by the Parties and shall end until all the secured debts are paid off.

 

(2)          This Agreement shall be independent from the Primary Agreement and shall not be invalidated by the invalidity of the Primary Agreement.  If the Primary Agreement becomes invalid, then the Mortgagor shall undertake joint and

 

 

several liabilities to pay off the debts arising from the Debtor’s repayment/payment of the loan principal, interest and other compensations under the Primary Agreement.

 

13.       Dispute Settlement

 

Any disputes arising from the performance of this Agreement may be solved via mutual negotiation.  If no agreement on the dispute settlement is reached, then such dispute shall be handled according to Option (1) and (3) as provided below:

 

(1)          File a lawsuit with the people’s court where Party B is located

(2)          Submit the dispute to Beijing Arbitration Committee for arbitration (in Beijing) in accordance with its applicable arbitral rules at the time of the submission.  The arbitral award is final and shall be binding on the Parties.

(3)          If Party B files a law suit, all the attorney fee incurred shall be borne by Party A.

(4)          During the litigation or arbitration period, other provisions under this Agreement which are not related to the dispute shall be performed as well.

 

14.         Special Agreement: If Party A fails to perform its guarantee liability or fails to fully perform its guarantee liability, then Party A is willing to accept the enforcement according to the law.

 

15.         This Agreement has 2 original copies for each Party to hold one, which shall have the same legal effect.

 

Party A (Company Stamp): Daqing Borun Biotechnology Co., Ltd.

Legal Representative:

Authorized Representative: Cui Xingjian

 

Party B (Company Stamp): Zhong Lv Credit Guarantee Co., Ltd.

Legal Representative:

Authorized Representative: Wang Yong

 

Date: August 23, 2010

Place for Execution:

 

Enclosed: “List of Mortgaged Properties” and other Annexes

 

 

Under the Counter-Guarantee (Mortgage/Pledge) Agreement ( Zhong Lv Bao Di Zi 2010  [006-4]  ):

 

List of Mortgaged Properties

 

Unit: RMB 10,000

 

	
No.
    	
 
    	
Name of the
   Mortgaged
   Properties
    	
 
    	
Owner
    	
 
    	
Unit
   (m2)
    	
 
    	
Area
    	
 
    	
Number of the Title
   Certificate
    	
 
    	
Address where
   the Real Estate
   is located
    	
 
    	
Value of
   the
   Mortgaged
   Properties
    	
 
    	
Mortgaged
   Amount for
   Other
   Creditor’s
   Rights
    	
 
    	
Remark
    
	
1
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
474.58
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 352399
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
47
    	
 
    	
 
    	
 
    	
 
    
	
2
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
2769.35
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 352401
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
280
    	
 
    	
 
    	
 
    	
 
    
	
3
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
2106.08
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 352402
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
210
    	
 
    	
 
    	
 
    	
 
    
	
4
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
3694.99
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 352405
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
370
    	
 
    	
 
    	
 
    	
 
    

 

 

	
5
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
580.02
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 352408
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
58
    	
 
    	
 
    	
 
    	
 
    
	
6
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
1771.35
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 352411
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
170
    	
 
    	
 
    	
 
    	
 
    
	
7
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
4281.48
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 352413
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
430
    	
 
    	
 
    	
 
    	
 
    
	
8
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
254.04
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 376588
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
25
    	
 
    	
 
    	
 
    	
 
    
	
9
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
391.03
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 376606
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
40
    	
 
    	
 
    	
 
    	
 
    
	
10
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
958.01
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 376591
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
90
    	
 
    	
 
    	
 
    	
 
    
	
11
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
1077.07
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 376587
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
110
    	
 
    	
 
    	
 
    	
 
    

 

 

	
12
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
3729.8
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 376616
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
370
    	
 
    	
 
    	
 
    	
 
    
	
13
    	
 
    	
House Property
    	
 
    	
Daqing Borun Biotechnology Co., Ltd.
    	
 
    	
(m2)
    	
 
    	
1415.14
    	
 
    	
Qing Fang Quan Zheng Da Tong Qu Zi Di NA 376595
    	
 
    	
Jubao Village, Zhusan Town, Datong District
    	
 
    	
140
    	
 
    	
 
    	
 
    	
 
    
	
Total Amount:
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
23502.94
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

Mortgagor (Company Stamp): Daqing Borun Biotechnology Co., Ltd.

Legal Representative:

Authorized Representative: Cui Xingjian

 

Mortgagee (Company Stamp): Zhong Lv Credit Guarantee Co., Ltd.

Legal Representative:

Authorized Representative: Wang Yong

Date: August 23, 2010

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