Document:

ex1018.htm

Exhibit 10.18

 

SERVICE AGREEMENT

This Service Agreement (hereinafter the -Agreement-) is entered into this 15th day of October, 2007 between Corporativo LODEMO S.A DE CV., a Mexican Corporation with its primary place of business located at Calle 18, # 201-B x 23 y 25, Colonias Garcia Gineres, C.P. 97070, Merida, Yucatan, Mexico (hereinafter -Lodemo"); and Medical Discoveries, Inc., a Utah Corporation dba Global Clean Energy Holdings, with its primary place of business located at 6033 W. Century Blvd, Suite 1090, Los Angeles, CA 90045, USA (hereinafter "Global"). The terms of this Agreement shall be binding upon the parties.

WITNESSETH:

          WHEREAS, Global intends to secure land and establish and operate farming operations within the Republic of Mexico (hereinafter "Mexico") for the purpose of growing jatropha Curcas (hereinafter ''Jatropha"), a non-edible agricultural product: and

          WHEREAS, Global intends to harvest Jatropha seeds from its farming operations in Mexico and extract oil from the seeds for the purpose of selling the oil inside and outside Mexico as an energy source and biodiesel feedstock; and

          WHEREAS, Global intends to construct and operate seed oil extraction facilities, and, in connection therewith, desires to set up logistics and transportation systems to transport production feedstocks, supplies, seed oil, biodiesel, and other end products; and

          WHEREAS, Global intends to acquire professional services from Lodemo to support its activities and objectives as described in this Agreement; and

          WHEREAS, the parties desire to set forth their specific understanding of their respective responsibilities and obligations associated with delivery of the services to be provided by Lodemo hereunder.

          NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Global and Lodemo agree as follows:

1.0 DEFINITIONS

          For purposes of this Agreement, the following terms and phrases have the following definitions:

"Facilities" means all physical assets purchased or intended for purchase by Global necessary to deliver the products and services defined in this Agreement; including structures, seeds, plants, fertilizer, planting materials and supplies, tools, machinery, equipment, and vehicles. For purposes of this Agreement, the Facilities shall not include any land.

"Project Operations & Capital Expenditure Budget" means a detailed and itemized estimate of projected yearly expenditures necessary for construction and operation of the Project based on anticipated progress and activity by the parties, as revised and amended from time to time in accordance with the terms hereof.

  

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"Facility Manager" means Lodemo's management representative with day-to-day operating responsibility for the Project.

"Farm" means the land owned or leased by Global in Mexico and all equipment necessary for the propagation, cultivation, and harvesting of Jatropha on such land.

"Logistics" means those assets and services that are necessary for the transportation of labor, materials, products, by-product or waste to or from the operations of the Project, Farms and Facilities.

"Oil Extraction Facility" means the assets and services required for the removal of oil from the Jatropha seeds produced from the Farms and for the storage of the seeds or oil. Global shall acquire or construct, and thereafter own, the Oil Extraction Facility. The construction or acquisition of the Oil Extraction Facility is not covered by this Agreement. The operation of the Oil Extraction Facility, however, is included in this Agreement as part of the Project, and the operation of the Oil Extraction Facility shall be included as part of the Services.

"Product" means the am It of Jatropha seed oil and the amount of biomass byproduct produced as part of the Project.

"Project" means establishment, development, and operation of Global's business to grow Jatropha in Mexico, to extract the oil from the Jatropha seeds, and the deliver of such oil to a buyer, including the purchase or lease of land in the name of Global, the establishment and operation of one or more Jatropha nurseries, the clearing, planting and cultivation of the Jatropha fields, the harvesting of the Jatropha seeds, the operation of Global's oil extraction facilities, and the logistics associated with the foregoing. The Project does not include the Joint Venture or the Biodiesel Refinery, which activities will be subject to one or more separate agreements between the parties hereto or their respective affiliates.

"Prudent Operating Practice" means any of the practices, methods and acts which, in the exercise of reasonable judgment in the light of the facts known at the time that a decision was made, could reasonably have been expected to accomplish the desired result at the lower reasonable cost, consistent with licensing and regulatory considerations, environmental considerations, reliability, safety and expedition.

  

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"Construction & Operating Plan" means a forecast established by the parties for each year describing on a calendar month basis the requested level of production of Product from the Project for the following calendar year.

"Scheduled Output" means the designed capacity of the Project on a month to month basis as set forth in the Construction & Operating Plan.

"Services" means the services to be provided by Lodemo under this Agreement required to accomplish the goals of the Project.

"Service Standards" has the meaning set forth in Section 3.2(a).

"Utilities" means, collectively, those utilities which are utilized or required in connection with the Project, including electricity, fuel, water, wastewater, and temporary portable lavatories, applied or consumed in the operation of the Project and the supply or performance of Services.

"Joint Venture" means business arrangement the parties intend to establish for the purpose of designing, constructing, and operating a biodiesel manufacturing facility to be located in Yucatan, Mexico (hereinafter the "Biodiesel Refinery"). The parties currently anticipate that any Joint. Venture established by them shall be equally owned by them and will be financed, constructed, and operated on terms to be negotiated by them.

2.0 SCOPE OF SERVICES 

2.1 General Scope of Services

Subject to Global's payment obligations as more fully set forth in Section 6, Lodemo's Services will include the following:

2.1.1 Project Management. Lodemo will provide Project Management services, which services, subject to the rights of the Global Project Manager to the extent granted herein, shall consist of implementing the Construction & Operating Plan, including the overall management and supervision of all aspects of the Project and the responsibility for ensuring the proper and timely performance of all Services to Global. Project Management provided by Lodemo will be provided by senior Lodemo staff and include participation in meetings with Global, planning, reporting, scheduling, budgeting, and day-to-day direction of all staff and activities.

2.1.2 Acquisition of Land Parcels. In cooperation with and on Global's behalf, Lodemo will identify potential land parcels suitable for nursery and Jatropha farming operations. Lodemo will negotiate with land owners the terms for the long-term use of the land, either by sale or by lease, for the purpose of Jatropha farming. Lodemo will assist Global by all necessary means to negotiate and consummate land sales and/or lease agreements. Notwithstanding the foregoing, Lodemo shall not have the right to enter into any land agreements (lease or purchase) on behalf of Global, and Lodemo shall not have the right to bind or obligate Global in any such land agreements. Nothing set forth in this Agreement obligates Global to enter into any land sales or lease Agreement, and Global shall have the sole right to determine whether to acquire land and the terms of such acquisition. The land contracts shall be entered into by an affiliate of Global, organized in Mexico.

  

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2.1.3 Clearing of Land. Lodemo will prepare all nursery and farming land parcels as required to allow for efficient planting, irrigation, drainage, and propagation of Jatropha. Lodemo will clear trees, shrubs, structures, large rocks, and other foreign objects from the land as required.

2.1.4 Nursery Construction and Operation. Lodemo will set up and construct a Jatropha plant nursery at a site location approved by Global. The nursery will be for the staging operations and storage and care of Jatropha seeds, seedlings, stem cuttings, and other materials and supplies necessary for nursery operations. Global will be responsible for providing all Jatropha seeds, seedlings, stem cuttings, and other materials and supplies necessary for nursery operations. Lodemo will provide staff for ongoing daily operations of the nursery.

2.1.5 Planting and Cultivation of Jatropha. Lodemo will plant and cultivate Jatropha on the land owned or leased by Global. Planting will include transfer of seeds, seedlings, and/or established stem cuttings supplied by and through the nursery. Lodemo will provide high quality long-term care of the Jatropha to include irrigation, removal of weeds, and seasonal pruning.

2.1.6 Jatropha Seed Harvesting and Transportation. Upon proper plant maturity, Lodemo will harvest and clean all mature Jatropha seeds from all of Global's planted land parcels described above in this Agreement on a periodic basis as required. All Global Jatropha seeds harvested by Lodemo will be cleaned (removal of seed casings, stems, and leaves) and transferred by Lodemo to the Oil Extraction Facility or to another Yucatan oil extraction facility designated by Global.

2.1.7 Operation of Oil Extraction Facilities. Lodemo will assist Global in identifying suitable locations for one or more Oil Extraction Facilities. Lodemo will provide all operations and logistics services for the management and operations of a Global Oil Extraction Facility. The Oil Extraction Facility will be designed, constructed, and owned by Global. Lodemo will be responsible for all operations and site logistics, including transfer and disposal of seed meal and transfer of seed oil to buyers and local Global biodiesel manufacturing facilities.

2.2 Other Services

The parties understand that in the process of executing its Services, Global and Lodemo may from time to time hire or cause to be hired contractors and subcontractors to complete certain tasks. If during the process of reviewing contractor and subcontractor proposals, Lodemo determines it can and desires to provide the same services for an equal or lower price and at an equal or better quality; Global will provide Lodemo the opportunity to enter into agreement and perform, said services for its proposed price and under similar terms.

  

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2.3 Construction of Facilities

2.3.1 Global Responsibilities. Global will fund the Project's costs and the fees and expenses set forth in this Agreement in the manner as specified in the Project Operations & Capital Expenditure Budget. Global shall also provide the necessary technology, including plant and soil science expertise, for the setup and construction of one or more nurseries and for Farm operations as necessary for the bulk production of Jatropha seeds. Global will provide all necessary funds, technology, engineering, procurement, and construction for the Oil Extraction Facilities.

2.4 Operation of Facilities

2.4.1 Services on Behalf of Global. Subject to (a) Global's right to exercise managerial control in accordance with default provisions as outlined in this Agreement, (b) Global's other rights hereunder, and (c) the other provisions of this Agreement, Lodemo will provide its Services on behalf of and for the account of Global, will have full authority and responsibility for executing its Services, and will perform its Services according to expectations and at such times as directed by Global.

2.5 Service Standards

2.5.1 Standard of Quality. Lodemo shall adhere to commercially reasonable standards in performing the Services in accordance with Global's direction and expectations as communicated in writing and through Project meetings with Global from time to time and shall perform or cause to be performed the Services in all material respects in accordance with (i) Prudent Operating Practice, (ii) Lodemo's standard practices for such services consistent with the scope and quality of similar services provided by Lodemo for itself in its other business activities, and (iii) all reasonable instructions of Global (collectively, the "Service Standard").

2.5.2 Compliance/No Violations. Lodemo shall perform its Services in accordance with applicable laws, rules, regulations, permits and licenses and orders of governmental authorities as in effect from time to time (collectively referred to as "Applicable Law"). Lodemo, in rendering its Services, shall have no obligation to take any action or otherwise to perform to the extent it reasonably believes such action or performance is or may be in violation of any Applicable Law or may involve any material risk to the Project, Facilities or Farm, or any part thereof. or any persons or property.

2.6 Personnel 

2.6.1 Formation of Labor Management Company. The parties understand and agree that Lodemo may create a new Mexican corporation (herein referred to as "NEW Co.-) to perform the functions of hiring in its name and managing personnel required for executing its Services under this agreement. In its function, NEW Co. will be responsible for all labor-related management functions, including all payroll operations and payment of social security and health and welfare contribution obligations. Lodemo agrees that, notwithstanding the formation of New Co, Lodemo will be responsible for the supervising and managing NEW Co. and that Lodemo shall be responsible to Global under the terms of this Agreement for the actions or omissions of NEW Co. Even though personnel required for execution of the Services may be employees of NEW Co., such personnel will remain under the sole and exclusive supervision and control of Lodemo. All Lodemo and NEW Co. employees will be properly classified, qualified, trained and supervised by Lodemo for the execution of the Services.

  

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2.6.2 Use of Employment Agencies. In order to hire appropriate personnel and fulfill the staffing obligations under this Agreement, Lodemo is authorized to hire personnel through an employment agency or labor outsourcing company. Additional fees required to hire personnel through an employment agency are considered Allowable Costs under the terms of this Agreement. All employees acquired through any employment agency will remain under the sole and exclusive responsibility, supervision, and control of Lodemo.

2.6.3 Right to Remove Personnel. If Global determines in good faith the continued assignment of any person, subcontractor, or employment agency performing or providing Services is not in accordance with the requirements and standards set forth in this Agreement, Global may deliver a notice to Lodemo stating its complaint and requesting removal and/or replacement of such person(s), subcontractor, or employment agency. Promptly after its receipt of such complaint and request by Global, Lodemo will investigate the matters stated in the complaint and request and discuss its own findings with Global. If Global still, in good faith, requests removal and/or replacement of such person(s), subcontractor, or employment agency, Lodemo will promptly remove and/or replace that person(s), subcontractor, or employment agency with one of suitable ability and qualifications reasonably acceptable to Global. In such cases, all costs incurred for the removal and replacement of such person(s), subcontractor, or employment agency, as well as any damages or repairs caused, will be considered as Allowable Costs.

2.7 Utilities

Lodemo will arrange for all necessary temporary and permanent Utilities to be provided to the nursery, any Farm, and any Oil Extraction Facility. In providing such Utilities, Lodemo will use such Utilities prudently and provide such s as economically as possible for such operation in connection with the Services.

2.8 Raw Materials, Supplies and Packaging Material.

Lodemo may acquire on behalf of Global all minor raw materials and supplies reasonably necessary for the Project, including maintenance, repair and operating supplies, spare parts, packaging materials, and utilities services and facilities required by Global and for execution of the Services. Such reasonably necessary minor raw materials and supplies are subject to periodic review by Global, but shall be considered as Allowable Costs.

  

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2.9 Maintenance and Repairs

In the course of conducting operations and performing its Services, Lodemo may provide maintenance and repairs which may or may not involve capital expenditures, in accordance with Global's quality standards and standard Lodemo practice. If, in the reasonable opinion of Lodemo, capital expenditures are required with respect to proper operation and maintenance of the Project, Lodemo may make such capital expenditures directly and consider them as Allowable Costs provided that such capital expenditures are planned and included in the Project Operations & Capital Expenditure Budget. If such capital expenditures are not planned and included in the Project Operations & Capital Expenditure Budget or exceed the amounts included in the Project Operations & Capital Expenditure Budget, Lodemo may make such capital expenditures directly and consider them as Allowable Costs provided that Lodemo will not proceed without Global's written consent, which shall not be unreasonably withheld, prior to approving any capital project in excess of $5,000 for any one expenditure or collectively for all related expenditures.

2.10 Global's Presence at Site

During all of Lodemo's activities and for the purpose of reviewing Lodemo's progress and performance, Global will have total unrestricted access to all Project locations, including the nursery, farms, Oil Extraction Facility, and any other sites where Global's materials are stored or work under this Agreement is being conducted.

2.11 Permits and Licenses

Lodemo shall be responsible for obtaining and maintaining in Global's name any and all permits or licenses required by Applicable Law relating to the construction, operation, and ownership of the Project, Farm, Facilities or Logistics (but not relating to employees or other labor hired by Lodemo or New Co.). In the event that under Applicable Law Lodemo is required to be a party to such permits or licenses. Lodemo shall hold those permits and licenses on behalf of Global and for Global's account. Lodemo or New Co. shall obtain and maintain all permits and licenses required by Applicable Law to hire the employees and laborers used in the Project, including persons working on the Farms, in the nursery, and in the Oil Extraction Facility. All direct costs associated with obtaining and maintaining permits are considered Allowable Costs. Lodemo shall be responsible for obtaining and maintaining such permits and licenses.

3.0 BUDGETING 

3.1 The Budgeting Process

Lodemo shall, for each calendar year, provide Global with Lodemo's proposed annual (i) Construction & Operating Plan and (ii) Project Operations & Capital Expenditure Budget (hereinafter the "Budget").

  

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The draft Construction & Operating Plan and Budget is attached hereto as Exhibits D and E, which Construction & Operating Plan and Budget will be updated and submitted for approval by Global; all subsequent annual Construction & Operating Plans and Budget's will be delivered to Global at least 90 days prior to the beginning of each subsequent calendar year. Global shall provide prompt review and comments to Lodemo as soon as reasonably practicable, but no later than forty five (45) days after receipt of the proposed Construction & Operating Plan and Budget. Global's comments may include questions, comments, objections or suggested modifications which Global may have with respect to such proposed plan and budget, and the parties shall cooperate with each other in developing a mutually acceptable Construction & Operating Plan and Budget. Global must approve the Construction & Operating Plan and Budget in writing before they may be considered valid and before costs associated with the Construction & Operating Plan and Budget may be considered as Allowable Costs. If Global does not approve the annual Construction & Operating Plan and Budget by December 15 of the applicable calendar year, Lodemo will continue to perform the Services and continue operations in accordance with the previous year's Construction & Operating Plan and Budget, until such time as a new Construction & Operating Plan and Budget may be established through negotiation or according to dispute resolution methodology described in Section 15. Lodemo will provide Global with a monthly reconciliation of actual expenditures compared to the Budget, and Global and Lodemo will review annual Construction & Operating Plans and Budgets jointly on a monthly basis. The annual Construction & Operating Plan and Budget may be revised with the written consent of both parties during monthly reviews to reflect revisions necessitated by changed circumstances, including changes in law, scope, emergencies, and force majeure events.

3.2 Budget Detail and Format

Information included in the annual Construction & Operating Plan and Budget, as well as all supporting data, formulas, calculations, and back-up information will be available for review at any time by either party and will be shared upon request by the parties. Annual Construction & Operating Plans and Budgets will be provided by Lodemo in significant detail consistent with common professional practice and in a form that Global may request in order for it to adequately provide review and make prudent business decisions.

4.0 MANAGEMENT AND CONTROL

4.1 Responsibility of Personnel

Except as otherwise provided in this Agreement, Lodemo shall have exclusive managerial control over and responsibility for its personnel (and any personnel hired by New Co.), any subcontractors, and suppliers in the execution of its Services. Such control shall include decision making authority over coordination and scheduling labor, logistics, and operations; provided, however, that such control shall be effected in a manner which does not adversely affect the quality of service, result in delays, or violate or contradict any labor laws, rules, or moral obligations applicable to employees under the responsibility, supervision and control of either Lodemo, its subcontractors or suppliers, NEW Co., or any employ] it agency performing services hereunder, and such employees shall not be required to report to any person who is not ultimately reporting up through Lodemo.

  

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42 Global Right to Review

Global reserves the right to review the management practices of Lodemo, its subcontractors and suppliers, NEW Co., and any employment agency performing services hereunder to determine and ensure that the Services are managed using methods that are not detrimental to safety and health of any employed person, or are not in violation of applicable standards or laws.

4.3 Global Project Manager

Global shall have the right at any time to appoint a Global representative as the person responsible for overall strategic planning and management of the Project and who may be located at any given time at any of the Facilities (the -Global Project Manager"). The Global Project 1Wrger may also be assisted in his work by other Global staff The Global Project Manager's function be to provide overall direction regarding the Project, including (i) the purchasing/leasing land, (ii) approving changes to the Budget, (iii) establishing overall practices and procedures for planting and harvesting Jatropha plants and seeds, and (iv) monitoring Lodemo's progress in carrying out the Construction & Operating Plan. The Global Project Manager and his staff, if any, will not provide supervision of Lodemo construction, operations, or logistics personnel and will not otherwise be responsible for, or involved in, the day-to-day operations of the Project. Global shall bear all costs and expense associate with its Global Project Manager and related staff. The Global Project Manager and staff will be provided access to all Facilities and financial and operating records of the Project, and at the Global Project Manager's request, will have the right to participate in Lodemo's planning, scheduling, and budgeting activities and meetings convened concerning operations or the execution of its Services ("Management Meetings").

4.4 Project Management Meetings

Lodemo will plan and arrange for monthly project management meetings to occur on or about the 20thday of every calendar month during the term of the Agreement (Management Meetings"). Through the Management Meetings, the parties shall perform progress and budget reviews and coordinate any shutdowns, curtailments, service outages, and changes to operations.

5.0 ENVIRONMENTAL POLICIES

5.1 Environmental Plan

As a part of its Services, Lodemo shall provide Global with a project environmental plan, which will include a description of its waste collection and disposal strategy, land clearing and biomass disposal strategy, site drainage plans, and its plan for providing any other services in accordance with local and national environmental laws and Global's corporate policies and practices.

  

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5.2 Environmental Permits

On behalf of Global, Lodemo will apply for and bear responsibility for acquiring any required environmental permits and/or licenses, and will maintain and administer said permits and/or licenses for the Project and Facilities.

6.0 COMPENSATION FOR SERVICES

As compensation for Lodemo providing the Services herein, Global shall make payments to Lodemo as follows:

6.1 Allowable and Non-Allowable Costs

Allowable and Non-Allowable Costs for the Project shall be determined as follows.

6.1.1 Allowable Costs 

"Allowable Costs" shall mean the actual costs described in this Subsection that are paid or payable by Lodemo and necessarily incurred during performance of the Services. Allowable Costs are subject to additions or deductions which may be made in accordance with this Agreement. Allowable Costs shall only include the following items:

6.1.1.1 Direct costs of salaries and wages actually paid to Lodemo's full-time employees listed in Exhibit "B". Other personnel who are specifically named in Exhibit "B" may also be charged to the Project to the extent that use of such personnel is included in the Budget or otherwise approved by Global. Any changes to such chargeable personnel during the course of the Project must be approved in writing by Global.

6.1.1.2 A factor of fifteen percent 15%) (Lodemo's "Labor Burden Rate") of the actual salaries and wages described in Subsection 6.1.1 above to compensate Lodemo for the cost of all statutory payroll taxes levied or assessed by any governmental body during the performance of the Services, including but not limited to retirement, unemployment taxes and unemployment insurance, and worker's compensation costs; and for the cost of any and all company paid employee benefits, including but not limited to holiday pay, vacation pay, sick leave, retirement plans, group medical and life insurance benefits. The Labor Burden Rate shall be applied to all hours at the salaries or wages listed in Exhibit "R-

6.1.1.3 Actual direct cost to Lodemo of non-employee agency personnel in accordance with the amounts paid pursuant to the applicable agency hire agreements plus an allowance of five percent (5%) to compensate Lodemo for its overhead costs pertaining to such personnel.

  

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6.1.1.4 Actual cost of amounts paid or payable by Lodemo to its subcontractors and vendors for services performed pursuant to subcontracts and purchase orders which have reviewed and approved by Global.

6.1.1.5 Actual direct cost to Lodemo of all materials and equipment incorporated into the Services by Lodemo including the direct costs of transportation thereof Said costs shall be invoiced at actual trade and quantity discount prices, when applicable. Any salvage value actually realized by Lodemo at the end of the Project for any excess items paid for by Global shall be a credit for Global's account.

6.1.1.6 Actual direct costs to Lodemo of rental charges for all necessary construction machinery and equipment utilized in the Services, exclusive of small tools, including the direct costs of installation, dismantling, removal, maintenance. and grease; insurance; transportation and delivery. Such rental charges shall not exceed the prevailing rates in the area of the Project.

6.1.1.7 Actual and reasonable travel and subsistence expenses of Lodemo's Site Personnel listed in Exhibit "B" hereto while traveling in the discharge of duties in connection with the Services. Lodemo shall use its best efforts to obtain the lowest cost for such travel and expenses.

6.1.1.8 Actual direct costs of sales and use taxes directly relating to the Services that are imposed by governmental authorities and paid by Lodemo on behalf of Global.

6.1.1.9 Costs of clean-up and removal of debris.

6.1.1.10 Costs incurred due to an emergency affecting the safety of persons and property.

6.1.1.11 Costs of site security services for protection of the Services and Project unless provided by Global.

6.1.1.12 Project-related license fees required by statute.

6.1.1.13 Construction, building, or environmental permit fees paid by Lodemo when approved in advance and in writing by Global.

6.1.1.14 Other actual direct costs incurred in the performance of the Services if and to the extent such costs are incurred in the course of Lodemo's execution of the Plan and are contemplated in the Budget as approved in accordance with this Agreement.

6.1.1.15 Costs of claims, remedial actions, tines and damages resulting from Global's refusal or failure to implement plans and courses of actions specified in the annual Plan and Budget, including any labor termination and subcontractor termination cost.

  

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6.2 Non-Allowable Costs

"Non-Allowable Costs" shall mean the direct and/or indirect costs described in this Subsection 6.2. All such Non-Allowable Costs are included in Lodemo's Management Fee set forth in Section 6.4 and/or as provided by mutual written agreements, including Change Orders, as provided for in this Agreement. Lodemo shall not be entitled to receive any additional reimbursement for any of the items described as follows:

6.2.1 All direct and indirect operating. maintenance and overhead costs of any kind relating to Lodemo's principal and branch offices which is not dedicated to or reserved for use on the Project, including but not limited to office space, furniture and equipment; rent; maintenance; local telephone; utilities; depreciation; security; furniture; office equipment; office supplies; property taxes; the development of construction manuals, standards or computer programs; personnel training other than for safety training; and janitorial services. The parties agree that Global shall only pay or reimburse Lodemo for any expenses related to its offices that are dedicated to or reserved for the use of the Project is Global has approved such offices in writing.

6.2.2 Any expenses relating to Lodemo's operating capital, including interest on Lodemo's capital employed in support of the Services.

6.2.3 All costs arising out of grossly negligent acts or omissions by Lodemo, any subcontractor, vendor or anyone directly or indirectly employed by any of them, or for whose acts any of them may be liable, for: (a) all costs including defense costs, losses and damages arising out of Lodemo's indemnity obligations to the extent defined in Article 8 hereof; and (b) the cost of all deductibles and losses not covered by any of the insurance policies required to be provided pursuant to Article 8 hereof

6.2.4 All costs incurred, at any time during the course of executing the Services by Lodemo, any subcontractor, vendor or anyone directly or indirectly employed by any of them, or for whose acts any of them may be liable, for correction, removal, replacement and disposal of any non-conforming work, materials or equipment to the extent defined in this Agreement.

6.2.5 All costs incurred by Lodemo for bonuses, stocks options, profits sharing arrangements and similar incentive programs.

6.3 Reimbursement for Allowable Direct Costs

Lodemo will maintain complete and detailed records of all of its direct and actual out-of-pocket costs and expenses related to the Project or otherwise subject to this Agreement. On or about the 20th day of each month during the term of this Agreement. Lodemo will submit its monthly application for payment ("Monthly Invoice"). Lodemo's Monthly Invoice will include a detail record of the previous month's direct and actual costs including employee man-hours and costs, agency personnel man-hours and costs, subcontractor costs, material costs, and equipment costs. All direct costs must be supported as Allowable Costs by verifiable documentation including timesheets and receipts. Undocumented or Non-Allowable Costs will not be reimbursed.

  

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Operating Account

6.3.1 Establishment of Operating Account

Lodemo and Global shall establish a local depository account at a bank or other institution approved in writing by Global (the "Operating Account"). If requested by Global, all funds in the Operating Account shall be invested in a cash management program approved by Global ("Cash Management Account"). Lodemo will be authorized to make deposits and withdrawals from the Operating Account and Cash Management Account in accordance with this Agreement and within the guidelines of the then current Budget. Project funds shall not be commingled with Lodemo's other funds and only Project funds shall be deposited in the Operating Account and in no other account. Lodemo shall pay all of its direct costs authorized to be paid under this Agreement out of the Operating Account or Cash Management Account.

6.3.2 Funding of Operating Account

On or before the 1st day of each month, Global agrees to deposit into the Operating Account or Cash Management Account funds in an amount sufficient to maintain the Minimum Balance. The term "Minimum Balance" when used herein shall mean an amount equal to the projected operating and capital expenses of the Project projected for the following two months, as forecasted in the Budget, less any existing balances in the Operating Account. If, upon review of Lodemo's Monthly Invoice it is determined that Lodemo has expended funds from the Operating Account or Cash Management Account determined by Global to be Non-Allowable Costs, either Lodemo will replace these funds directly or credit Global by the same amount in the following month's Monthly Invoice. If the Non-knowable costs are not replaced or credited, the Minimum Balance will be reduced by the same amount invoiced as a Non-Allowable Cost.

6.4 Management Fees

6.4.1 Basic Fee

On a monthly basis, Global shall pay to Lodemo for the duration of this Agreement, a Management Fee equal to the greater of (i) $60 per hectare per year ($5 per hectare per month) for every full hectare planted and under cultivation in Jatropha, and (ii) the monthly fee shown by schedule in Exhibit A (hereinafter the -Minimum Fee"). Notwithstanding the foregoing, if at the time the Management Fee is determined the number of hectares planted and under cultivation is less than the amount set forth on Exhibit A solely as a result of Lodemo's failure to comply with its obligations under this Agreement, including its obligations to provide land aggregation, nursery and planting Services in a timely manner, the Minimum Fee shall be readjusted to reflect the number of hectares not planted as a result of Lodemo's failure to comply.

  

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6.4.2 Performance Payment

Global will pay to Lodemo an incentive to reduce costs of operation of the Project, Farm and Facilities. Lodemo will be paid 20% of the reduction in actual direct costs (Allowable Costs) below the approved annual Budget for each year it reduces said costs. This cost reduction applies to all costs including land leases and other direct costs. This reduction may not in any way adversely impact quality of Product, worker treatment, safety or long term viability of the Farm or Project or violate any law or environmental rule or policy.

6.4.3 Provision for Transfer of Oil to Mexico Joint Venture

As additional compensation for Lodemo's Services under this Agreement and its agreement to enter into the Joint Venture, Global agrees to sell 10% of the net Jatropha seed oil produced by the Project to the Joint Venture for exclusive use as feedstock for the Biodiesel Refinery. The price at which such Jatropha seed oil will be sold to the Joint Venture shall equal Global's actual cost of production, including the allocated portion of the payments mar' by Global to Lodemo under this Agreement (excluding this Subsection 6.4.3).

6.4.4 Improved Production Bonus

Global will provide to Lodemo an incentive for increased oil production from the Project. Twenty percent (20%) of all oil produced by Global as part of the Project in excess of the projected baseline production shown in Exhibit C (as amended with the mutual written consent of the parties from time to time) will be sold to the Joint Venture at the same average cost as other oil sold by Global during any given month for exclusive use as feedstock to the Joint Venture.

6.4.5 Biomass Sales Incentive

Global will pay to Lodemo an incentive for all sales of the biomass byproduct produced from the seed oil extracted at the Oil Extraction Facility (hereinafter the "Biomass Incentive"). The Biomass Incentive will be 50% of the net price of the sale, which will be calculated by subtracting from the actual price received the amount of the actual handling costs of the biomass, including shipping, from the gross sales price. The Biomass Incentive will be paid 30 days of it by Global of funds from the buyer.

All potential sales of biomass are subject to review by Global, and Global reserves the right to either accept or reject any potential sale. However, if Global chooses to sell the biomass to a buyer for a lower price than an alternate buyer, Global will pay to Lodemo its Biomass Incentive based on the documented price of the alternate buyer.

  

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6.4.6 Payment of Redundancy Costs in the Event of Suspension or Termination

At any time during the term of this Agreement, upon suspension or termination of this Agreement or the supply or performance of Services hereunder, in whole or in part, or upon cessation of production at the Project, or upon any major reduction by Global in the quantity of Products to be produced at the Project hereunder, in each case for any reason other than a breach by Lodemo of this Agreement, Global shall reimburse Lodemo for all direct costs incurred in separation and outplacement associated with any of Lodemo's or it's subcontractor's personnel or employees to the extent made redundant as a result of any such suspension, termination, cessation, or permanent reduction or shutdown, or major reduction. Any direct costs incurred and approved according to terms described in this Section will be debited from any remaining balance of funds previously advanced by Global to Lodemo through the Operating Account or Cash Management Account.

7.0 INSURANCE

Each party shall purchase and maintain its own insurance in such amounts and covering such risks as are usually carried by companies engaged in the same or similar business and similarly situated, including insurance against public liability and property damage. Both parties will work together to minimize the existence of non-required or redundant insurance coverages. Notwithstanding, the parties agree to purchase appropriate insurance coverage for the risks related to this Project. These risks and insurance coverage may include heavy rainfall, hurricanes, floods, fire and explosion damage. Cost of insurance is generally an Allowable Cost, but must be approved in advance in writing by Global.

8.0 THIRD PARTY INDEMNIFICATION

To the extent not covered by insurance, Lodemo agrees, to the fullest extent permitted by' law, to indemnify, defend, and hold Global and its officers, agents. and employees of Global harmless from and against any and all third party claims, demands, causes of action, damages, losses, and expenses of whatsoever nature, character, or description, regardless of merit thereof, which are or may be asserted against Global by any person or entity, and which arise out of or result from, in whole or in part, (i) the negligent acts or omissions of Lodemo in the performance of the Services under this Agreement, or (ii) the breach by Lodemo of any terms of this Agreement. The acceptance of the Services Global shall not operate as a waiver of such right of indemnification.

To the extent not covered by insurance, Global agrees, to the fullest extent permitted by law, to indemnify, defend, and hold Lodemo, its officers, directors, employees, and subcontractors harmless from and against all third party claims, demands, causes of action, damages, losses, and expenses of whatsoever nature, character, or description, regardless of the merit thereof, which are or may be asserted against Lodemo by any person or entity, and which arise out of or result from, in whole or in part, (i) the negligent acts or omissions of Global in the performance of Lodemo's obligations under this Agreement, or (ii) the breach by Global of any terms of this Agreement.

  

Page 15 of 20

  

9.0 LIMITATION OF LIA ATV I L) DISCLAIM

Each party to this Agreement shall only be liable to the other party and its agents and employees for losses sustained by the other party and its agents and employees directly as a result of the first party's lack of performance under this Agreement and losses resulting from intentional misconduct or gross negligence by the first party, its employees, it's subcontractors (including the employees of NEW Co.). Neither party shall be liable for special, incidental, indirect, punitive or consequential damages under this Agreement; provided that this limitation shall not apply in the case of a party's willful acts. Anything contained herein to the contrary notwithstanding, Global acknowledges that Lodemo makes no representation or warranty of any kind with respect to having past experience in the provision of the Services, the financial viability of the Project, or the fitness of Jatropha oil for its intended use as a feedstock.

10.0 TAXES

Global shall reimburse Lodemo on a current basis for all taxes, excises or other charges which Lodemo may be required to pay to any government (federal, state, or local) relating to the Project, whether current in nature or as the result of any tax audit, by reason of any of its activities hereunder and not otherwise provided for herein. Notwithstanding the foregoing, Global shall not be required to reimburse Lodemo for taxes on or measured by Lodemo's fees, net income or profit.

11.0 OWNERSHIP

Under the terms of this Agreement, Lodemo shall not receive or acquire legal or equitable ownership or possession rights in any part of the Project or to any of Global's assets. Any ownership or equity interest Lodemo may ultimately receive will be covered under a separate agreement.

Except for the rights of access and operation granted in this Agreement, Lodemo shall not receive or acquire any legal or equitable ownership or possession rights to any part of the Project or any of Global's personal or real property contained or stored at the Project or the Facility. This exclusion to access and ownership includes seed oils and/or chemicals stored in tanks, trucks, railcars, tanks or barges.

  

Page 16 of 20

  

The following documents shall be collectively referred to in this Agreement as the "Project Documents": all information, intellectual property, work product, and all documents (each in whatever medium or format, including computerized reports and information on disk) related to arising out of the Project, and the performance of the Services, including, without limitation, all land plans, maps, engineering studies, soil studies, geological studies, and other engineering information, all documentation prepared or obtained by Lodemo or Global in preparation for fi ;s with or filed with a governmental or quasi-governmental agency plans and specifications and environmental reports, and all other studies, tests, work product, analyses, development plans, studies, drawings, designs, and sketches, memoranda, construe., ,1 documents, marketing plans, financial analyses, books, records, data, and reports prepared or obtained by Lodemo or Global, their its employees, agents, consultants or subcontractors relating in any manner to the Project. The Project Documents shall be and remain the sole and exclusive property of Global and Global shall have the right to use such for any purpose without any additional compensation to Lodemo. Lodemo shall acquire no ownership rights in the Project Documents, but shall have the right to use such Project Documents in performance of the Services hereunder. Lodemo acknowledges that it is acting as an agent of Global, and all of the work product and Project Documents, and other intellectual property created, produced, or procured by Lodemo or any consultant or subcontractor, regardless of form of medium, are the sole property of Global, and constitute a -Work Made for Hire". If any services or processes or products are patentable, Global may, at its option, apply for a patent and the patent, if issued, shall be in Globes name and be the sole property of Global. All trademarks, trade names, logos, and other copyrightable materials shall be owned by Globable and may be registered by Global.

12.0 CONFIDENTIALITY

Neither party shall, directly or indirectly, disclose, communicate, divulge, furnish or make accessible or available, in whole or in part, to any person, firm, company, corporation or other entity, other than to its employees and other representatives to the extent necessary to discharge and perform its obligations under this Agreement or as required by any law or regulation, any data, know-how, drawings, plans, written instructions, or other writings, processes, techniques, methods, designs, inventions, materials, formula, equipment, machinery, de.4ces and the like (whether or not patentable) of a secret and confidential nature, and any other confidential information, material or matter, or trade secrets, relating to pertaining to the business of the other party that it learns of pursuant to this Agreement including, any such information relating to the processes and equipment for the production of the process used in the Project or by a similar process.

13.0 TERM

Unless terminated pursuant to Section 14, the term of this Agreement shall commence on the date hereof and continue for 20 years from the date hereof. At the expiration of the term, or upon termination pursuant to Section 14, Global shall continue to own all rights to the contracts, land, agricultural output, Facilities, Products, intellectual rights, and all other Project assets. Sections 8, 9, 11 and 12 shall survive the termination of this Agreement.

  

Page 17 of 20

  

14.0 TERMINATION FOR DEFAULT; FORCE MAJEURE

14.1 In the event Lodemo is in default in the performance of any obligation under this Agreement and shall fail to diligently proceed to correct such default within thirty (30) calendar days following written notice from Global (or such longer time period to the extent the cure of the default is of a nature so as to require more time, provided that Lodemo commences the cure and continues the prosecution of the cure until completed) , or if Lodemo dissolves, tiles a petition in bankruptcy, or makes a general assignment for the benefit of its creditors, or if a petition in bankruptcy is filed against Lodemo or a receiver is appointed for reasons of insolvency; Global may, without prejudice to any other rights or remedies Global may have, terminate this Agreement by written notice. In the event of termination for default, Global may take possession of and finish the Services by whatever method Global deems expedient. In such event, Lodemo shall be liable for all damages sustained by Global by reason of such termination, whether at law or in equity. Global's right to require strict performance of any and all obligations in this Agreement shall not be affected by any previous waiver, forbearance or course of dealing prior to such termination. Global shall be entitled to recover its reasonable attorneys' fees, costs and disbursements in any action successfully brought to enforce its rights under this Agreement.

14.2 Global shall have the option, exercisable in good faith at its reasonable judgment, to terminate this Agreement, upon 90 days' prior written notice to Lodemo, if both (i) an event of Infeasibility has occurred, and (ii) Global thereafter ceases to pursue the Project. For purposes of this Agreement, "Infeasibility" shall mean the inability of the parties to proceed with the Project or impracticality of the Project for reasons beyond their reasonable control, including without limitation:

1. Political actions of a governmental agency that makes the Project more costly or time consuming or financially burdensome to undertake, including, without limitation, restrictions on land ownership or use, restrictions on the processes involved in the Project, nationalization of the Project, or enactment of laws that significantly and adversely affect the Project.

2. Determination that the oil extraction process does not result in commercially significant quantities of usable oil, or that the price for such oil makes the Project commercially unsustainable.

3. Natural disaster that affects a material portion of the Project (including the Jatropha plants, the distribution system, or the Oil Extraction Facility), and is not able to be corrected within twelve months.

4. Unexpectedly high costs of operations, provided that high costs shall grounds for claiming

Infeasibility unless the overall operating, costs exceed 200% of the Budget.

15.0 CLAIMS AND DISPUTE RESOLUTION 

All claims and disputes and other mattersin question arising out of or relating to this Agreement or the breach thereof, shall be submitted first to voluntary Mediation, and if Mediation is not successful, then to binding Arbitration, in accordance with the then-current Model Procedure for Mediation of Business Disputes of the Center for Public Resources. Arbitrators and Mediators shall be jointly selected by the parties, and have experience in international dispute resolution involving business between Mexico and the United States. Judgment on any arbitration award may be entered in a court of any competent jurisdiction.

  

Page 18 of 20

  

The prevailing party shall be entitled to recover its reasonable attorneys' fees, costs and disbursements in any action brought to enforce or its rights under this Agreement or to interpret the provisions of this Agreement. The existence of any claim, dispute or legal proceeding shall not relieve Lodemo from its obligation to properly perform its Services during such Mediation or Arbitration proceedings as set forth herein.

Notwithstanding the above, before either party pursues Mediation or Arbitration, the parties agree to attempt to resolve any dispute amicably at a meeting to be attended by persons with decision-making authority. If, within thirty (30) calendar days after such meeting, the parties have not succeeded in negotiating a resolution of the dispute, they agree to resolve the dispute according to the Mediation and Arbitration dispute resolution process described in this Section.

MISCELLANEOUS 

Successors and Assigns

Except as expressly provided below, neither this Agreement nor any it, interest or obligation hereunder may be assigned by either party without the prior written consent of the other, except that (i) either party may assign this Agreement to an Affiliate of such party: provided that the party assigning this Agreement shall remain liable notwithstanding such assignment, (ii) Lodemo may assign this Agreement in whole to any purchaser of its business and assets, but as a condition of any such assignment, shall procure the written assumption of this Agreement, and (iii) Global may assign this Agreement to any purchaser of all or substantially all of the assets of the Project, provided that Global shall, as a condition of any such assignment, procure the written assumption of this Agreement by such assignee. The terms, covenants and conditions contained in this Agreement, including the obligations of indemnity contained herein, are binding upon and inure to the benefit of Lodemo and Global and their respective successors and permitted assigns and shall survive any transfer of the ownership or control of Lodemo or Global.

(The remainder of his page is intentionally left blank)

  

Page 19 of 20

  

16.0 ENTIRETY OF AGREEMENT

This Agreement contains the full and complete understanding of the parties pertaining to the Project and the Services and supersedes any and all prior representations, negotiations, agreements or understandings between the parties, whether written or oral. This Agreement may not be modified except by a subsequent writing executed by both parties.

The parties hereby execute this Agreement by their respective duly authorized representatives as of the Effective Date stated in the preamble of this Agreement.

	
 

	
 

	
 

	
Medical Di, veries, Inc.,

	
 

	
Corporativo LODEMO S.A DE CV.

	
dba can Energy Holdings

	
 

	
 

	

	
 

	
 

	
 

	
 

	
NAME

	
 

	
President & Chief Oneratine Officer

	
 

	
 

	
ITLE

	
 

	
TITLE

	
 

	
 

	
 

	
 

	
ATI

	
 

	
 

	
DATE

	
 

	 	 	 	 	 

  

Page 20 of 20

  

Exhibit A

Minimum Fee Schedule 

Payment Schedule

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Month

	
 

	
Expected Fee

	
 

	
Minimum

	
 

	
Est. Allowabl

	
 

	
Minimum

	
 

	
-3

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
5,000

	
 

	
 

	
5,000

	
 

	
-2

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
5,000

	
 

	
 

	
5,000

	
 

	
-1

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
5,000

	
 

	
 

	
5,000

	
 

	
1

	
 

	
 

	
1,665

	
 

	
 

	
1,665

	
 

	
 

	
5,000

	
 

	
 

	
6,665

	
 

	
2

	
 

	
 

	
3,330

	
 

	
 

	
3,330

	
 

	
 

	
5,000

	
 

	
 

	
8,330

	
 

	
3

	
 

	
 

	
4,995

	
 

	
 

	
4,995

	
 

	
 

	
5,000

	
 

	
 

	
9,995

	
 

	
4

	
 

	
 

	
6,660

	
 

	
 

	
6,660

	
 

	
 

	
5,000

	
 

	
 

	
11,660

	
 

	
5

	
 

	
 

	
8,325

	
 

	
 

	
8,325

	
 

	
 

	
5,000

	
 

	
 

	
13,325

	
 

	
6

	
 

	
 

	
9,990

	
 

	
 

	
9,990

	
 

	
 

	
5,000

	
 

	
 

	
14,990

	
 

	
7

	
 

	
 

	
13,320

	
 

	
 

	
13,320

	
 

	
 

	
5,000

	
 

	
 

	
18,320

	
 

	
8

	
 

	
 

	
16,650

	
 

	
 

	
16,650

	
 

	
 

	
5,000

	
 

	
 

	
21,650

	
 

	
9

	
 

	
 

	
19,980

	
 

	
 

	
19,980

	
 

	
 

	
5,000

	
 

	
 

	
24,980

	
 

	
10

	
 

	
 

	
23,310

	
 

	
 

	
23,310

	
 

	
 

	
5,000

	
 

	
 

	
28,310

	
 

	
11

	
 

	
 

	
26,640

	
 

	
 

	
26,640

	
 

	
 

	
5,000

	
 

	
 

	
31,640

	
 

	
12

	
 

	
 

	
29,970

	
 

	
 

	
29,970

	
 

	
 

	
5,000

	
 

	
 

	
34,970

	
 

	
13

	
 

	
 

	
33,300

	
 

	
 

	
33,300

	
 

	
 

	
5,000

	
 

	
 

	
38,300

	
 

	
14

	
 

	
 

	
36,630

	
 

	
 

	
36,630

	
 

	
 

	
5,000

	
 

	
 

	
41,630

	
 

	
15

	
 

	
 

	
39,960

	
 

	
 

	
39,960

	
 

	
 

	
5,000

	
 

	
 

	
44,960

	
 

	
16

	
 

	
 

	
43,290

	
 

	
 

	
43,290

	
 

	
 

	
5,000

	
 

	
 

	
48,290

	
 

	
17

	
 

	
 

	
46,620

	
 

	
 

	
46,620

	
 

	
 

	
5,000

	
 

	
 

	
51,620

	
 

	
18

	
 

	
 

	
49,950

	
 

	
 

	
49,950

	
 

	
 

	
5,000

	
 

	
 

	
54,950

	
 

	
19

	
 

	
 

	
53,280

	
 

	
 

	
50,000

	
 

	
 

	
5,000

	
 

	
 

	
50,000

	
 

	
20

	
 

	
 

	
56,610

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
21

	
 

	
 

	
59,940

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
22

	
 

	
 

	
63,270

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
23

	
 

	
 

	
66,600

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
24

	
 

	
 

	
69,930

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
25

	
 

	
 

	
73,260

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
26

	
 

	
 

	
76,590

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
27

	
 

	
 

	
79,920

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
28

	
 

	
 

	
83,250

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
29

	
 

	
 

	
86,580

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
30

	
 

	
 

	
89,910

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
31

	
 

	
 

	
91,575

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
32

	
 

	
 

	
93,240

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
33

	
 

	
 

	
94,905

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
34

	
 

	
 

	
96,570

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
35

	
 

	
 

	
98,235

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
36

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
37

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
38

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
39

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
40

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
41

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
42

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
43

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
44

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
45

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
46

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
47

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
48

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
49

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
50

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
51

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
52

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
53

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
54

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
55

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
56

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
57

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
58

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
59

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
60

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
61

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
62

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
63

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
64

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
65

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
66

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
67

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
68

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
69

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
70

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
71

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
72

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
73

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
74

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
75

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
76

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
77

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
78

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
79

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
80

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
81

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
82

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
83

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
84

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
85

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
86

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
87

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
88

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
89

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
90

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
91

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
92

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
93

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
94

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
95

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
96

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
97

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
98

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
99

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
100

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
101

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
102

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
103

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
104

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
105

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
106

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
107

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
108

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
109

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
110

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
111

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
112

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
113

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
114

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
115

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
116

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
 

	
117

	
 

	
 

	
99,900

	
 

	
 

	
50,000

	
 

	
 

	
 

	
 

	
 

	
50,000

	
]

  

  

  

EXHIBIT B

LODEMO PERSONNEL

CONTRACTED PERSONELL

Contracted personal will be the key to make this plantation work and are required to accomplish most of the laborious efforts for this project. It is, therefore, important to be able to find and hire dependable and hard working individuals that will be able to perform the specific duties they will be assigned to do.

One of the first people needed, as we take over the ranch, is the Ranch Foreman. The Ranch Foreman will be responsible for the ranch when GCE or Grupo Lodemo's personal is not on site. He will coordinate with his subordinates to carry out any duties that are assigned to them and most importantly be responsible for the well being of the ranch and plantation efforts.

The second person to be hired will be the "Regador", the waterer, irrigator, the one responsible for irrigating and keeping the pivot systems operating and in good working order. He will have to keep good records of the irrigation systems plus records of the irrigation schedules as well. He will have to work closely with the ranch foreman and the agronomist to determine the fertilization rate that will have to be applied to the plants as assigned by the agronomist. El Regador will have his family living on the ranch with him and he will be assigned a home, on the ranch, so he can be close to the irrigation systems if anything fails during the irrigation cycles. His wife will provide meals to GCE and Grupo Lodemo personal, when on site, since it is not convenient to be going into Tizimin for meals. All necessary groceries and items will be provided for her to accomplish this task. This will cut down on expenses for those of us that are traveling and to the over all project budget. An allowance or salary will also be provided to her for her efforts.

It will be necessary to hire a night watchman, "Velador", or security guard to watch over the ranch at night, when everybody else is off and resting. Given the size of the ranch, it may take up to two or three people to take watch over such a large area.

Laborers will need to be contracted/hired as well as full time staff to take care of the daily routines of the ranch and other necessary duties required. These duties would include taking down fences, installing new ones, repairing them, repairing structures or buildings, repairing equipment and/or other duties as assigned. This personal would be the "ranch hands" and would not be part of the labor group that would take care of planting and growing the Jatropha. These people would work directly to operate and maintain the ranch and ensure that everything is in good working order. The number of laborers needed is still not defined but we can assume that, based on the size of ranch and the needed repairs to begin as we take over the ranch will be ten (10). These men will need to be semi-skilled and able to operate hand tools and have the basic knowledge of repairing structures or equipment. Two or three trucks will need to be assigned to this team especially as they are assigned different tasks.

A mechanic will also need to be hired to keep all equipment in good working condition. This individual must have experience with farm equipment as well as your typical vehicles to include all ranch hand and farm pick up trucks and cars. 

  

  

  

Exhibit C 

Baseline Production

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
20k Oil Production Schedule

	
 

	
 

	
 

	
 

	
 

	
Month

	
 

	
1st Planting

	
 

	
2nd Planting

	
 

	
3rd Planting

	
 

	
4th Planting

	
 

	
5th Planting

	
 

	
Monthly US Gals

	
 

	
Cumulative US Gallons

	
 

	
-3

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
-2

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
-1

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
1

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
2

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
3

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
4

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
5

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
6

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
7

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
8

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
9

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
10

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
11

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
12

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
13

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
14

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
15

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
16

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
1,332

	
 

	
 

	
2,664

	
 

	
17

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
1,332

	
 

	
 

	
3,996

	
 

	
18

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
1,332

	
 

	
 

	
5,328

	
 

	
19

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
1,332

	
 

	
 

	
6,660

	
 

	
20

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
2,665

	
 

	
 

	
9,325

	
 

	
21

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
2,665

	
 

	
 

	
11,990

	
 

	
22

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
2,665

	
 

	
 

	
14,655

	
 

	
23

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
2,665

	
 

	
 

	
17,320

	
 

	
24

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
2,665

	
 

	
 

	
19,985

	
 

	
25

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
3,997

	
 

	
 

	
23,982

	
 

	
26

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
3,997

	
 

	
 

	
27,979

	
 

	
27

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
5,329

	
 

	
 

	
33,308

	
 

	
28

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
5,329

	
 

	
 

	
38,637

	
 

	
29

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
-

	
 

	
 

	
5,329

	
 

	
 

	
43,966

	
 

	
30

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
6,661

	
 

	
 

	
50,627

	
 

	
31

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
6,661

	
 

	
 

	
57,288

	
 

	
32

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
7,994

	
 

	
 

	
65,282

	
 

	
33

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
7,994

	
 

	
 

	
73,276

	
 

	
34

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
-

	
 

	
 

	
7,994

	
 

	
 

	
81,270

	
 

	
35

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
9,326

	
 

	
 

	
90,596

	
 

	
36

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
9,326

	
 

	
 

	
99,922

	
 

	
37

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
10,658

	
 

	
 

	
110,580

	
 

	
38

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
10,658

	
 

	
 

	
121,238

	
 

	
39

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
11,990

	
 

	
 

	
133,228

	
 

	
40

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
11,990

	
 

	
 

	
145,218

	
 

	
41

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
1,332

	
 

	
 

	
11,990

	
 

	
 

	
157,208

	
 

	
42

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
13,323

	
 

	
 

	
170,531

	
 

	
43

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
13,323

	
 

	
 

	
183,854

	
 

	
44

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
14,655

	
 

	
 

	
198,509

	
 

	
45

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
14,655

	
 

	
 

	
213,164

	
 

	
46

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
1,332

	
 

	
 

	
14,655

	
 

	
 

	
227,819

	
 

	
47

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
15,987

	
 

	
 

	
243,806

	
 

	
48

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
15,987

	
 

	
 

	
259,793

	
 

	
49

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
17,319

	
 

	
 

	
277,112

	
 

	
50

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
17,319

	
 

	
 

	
294,431

	
 

	
51

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
17,319

	
 

	
 

	
311,750

	
 

	
52

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
17,319

	
 

	
 

	
329,069

	
 

	
53

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
2,665

	
 

	
 

	
17,319

	
 

	
 

	
346,388

	
 

	
54

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
18,652

	
 

	
 

	
365,040

	
 

	
55

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
18,652

	
 

	
 

	
383,692

	
 

	
56

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
18,652

	
 

	
 

	
402,344

	
 

	
57

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
18,652

	
 

	
 

	
420,996

	
 

	
58

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
2,665

	
 

	
 

	
18,652

	
 

	
 

	
439,648

	
 

	
59

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
459,632

	
 

	
60

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
479,616

	
 

	
61

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
499,600

	
 

	
62

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
519,584

	
 

	
63

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
539,568

	
 

	
64

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
559,552

	
 

	
65

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
579,536

	
 

	
66

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
599,520

	
 

	
67

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
619,504

	
 

	
68

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
639,488

	
 

	
69

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
659,472

	
 

	
70

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
679,456

	
 

	
71

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
699,440

	
 

	
72

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
719,424

	
 

	
73

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
739,408

	
 

	
74

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
759,392

	
 

	
75

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
779,376

	
 

	
76

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
799,360

	
 

	
77

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
819,344

	
 

	
78

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
839,328

	
 

	
79

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
859,312

	
 

	
80

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
879,296

	
 

	
81

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
899,280

	
 

	
82

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
919,264

	
 

	
83

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
939,248

	
 

	
84

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
959,232

	
 

	
85

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
979,216

	
 

	
86

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
999,200

	
 

	
87

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
1,019,184

	
 

	
88

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
1,039,168

	
 

	
89

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
1,059,152

	
 

	
90

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
1,079,136

	
 

	
91

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
1,099,120

	
 

	
92

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
19,984

	
 

	
 

	
1,119,104

	
 

	
93

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
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19,984

	
 

	
 

	
1,139,088

	
 

	
94

	
 

	
 

	
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95

	
 

	
 

	
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96

	
 

	
 

	
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116

	
 

	
 

	
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1,598,720

	
 

	
117

	
 

	
 

	
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3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
3,997

	
 

	
 

	
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1,618,704

	
 

  

  

  

Exhibit D

The draft Construction & Operating Plan

	
 

	
Detailed Development Plan

	
Prepared for:

tizimin ranch,

yucatan mexico

Tizimin Ranch - 2,000 Hectares

Property Background:

The property is currently owned by Consortium Cattle Raiser Preisser, INC. of C.V., a companywhich raises cattle throughout Mexico. The land was purchased by them between 1994-5 and clear title was recorded in their name at that time. Since then they have had a mortgage secured on the property and have since paid it off and recorded the payoff. 

The original land owner had been raising cattle on this property since 1995 and had a plan to clear more of the land a develop it as commercial grazing land for his cattle and to "rent" it to other cattle owners for grazing. They began clearing land, drilling wells, installing pumping stations, electricity and center pivot irrigation systems. In preparation for irrigating the entire property they installed approximately 14 wells and extended electricity to those locations. The improvements were estimated to have cost more then US $1.0 million.

They began by installing the first irrigation system for 135 Hectares on the most naturally clear land and then began clearing land to the west and east of that location. They installed two more systems, also for 135 Hectares each and then stopped work... we are not sure the exact reason, but we were told it was based on their internal company business direction in other areas of Mexico and had nothing to do with this particular property. We understand that they continue to raise cattle in other areas and have shipped all of the cattle to those areas. 

The land was being maintained by a curator who lived off of the proceeds and products of the 120 head of cattle and various other farm animals that were on the property. There are many structures throughout the property including farm houses, small barns and various fenced corals. It appears that most of the property has a perimeter fence, mostly barbed wire, some of which is electrified.

The land was purchased with all of the improvements, but the livestock and farm equipment was shipped to the original owners' other properties.

Property Description:

The property is a consolidation of 7 separate properties under four currently recorded titles.

The land is located approximately 12 miles northeast of Tizimin, Yucatan, Mexico and is approximately 110 miles from Merida and the port of Progresso and 75 miles from Cancun.

  

  

  

The Latitude/Longitude for points on the property are as follows:

	
 

	
 

	
 

	
Road Access to land

	
N 21 12 968

	
W 87 56 132

	
Eastern Entrance to property

	
N 21 12 936

	
W 87 56 517

	
Farm House Location

	
N 21 13 459

	
W 87 58 939

	
Center Point of Eastern Irrigation System

	
N 21 13 158

	
W 87 58 547

	
Center Point of middle Irrigation System

	
N 21 13 210

	
W 87 59 360

	
Center Point of Western Most

	
N 21 13 451

	
W 87 59 732

Property Attributes: 

	
 

	
 

	
 

	
 

	
�

	
Relatively clear flat land, ready for minor clearing and planting

	
 

	
 

	
 

	
 

	
�

	
(3) 135 ha irrigation systems installed (2 - 100% operational, 1- 90% complete)

	
 

	
 

	
 

	
 

	
�

	
14+ Wells already developed

	
 

	
 

	
 

	
 

	
�

	
Existing Water Concession (permit)

	
 

	
 

	
 

	
 

	
�

	
Good main and side road access to land for logistics

	
 

	
 

	
 

	
 

	
�

	
Adjacent to other potential land for expansion

	
 

	
 

	
 

	
 

	
�

	
Close proximity to multiple ports and coast access for logistics

The following are satellite maps of the land location and a CAD drawing of the property from information obtained by the owner.

1. Plant & Soil Science Support Plan

Genetic and Trait Selection - With the support of scientists from the University of Texas Pan America (UTPA) and additional Plant and Soil Scientists from Industry, we will continue to develop with the methodology for the genetic selection of the varieties of Jatropha curcas that show the best adaptability to our environment. We will utilize, as the base of the project, seeds of at least twelve different origins to be planted in the Tebec Plant Breeding & Propagation Site. The data and parameters will be obtained for the selection of the seeds which will propagate in the first productive units, implementing in parallel the continuous research program to reach the best productivity.

Genetic and Trait Selection Program

	
 

	
 

	
 

	
 

	
�

	
UTPA is generally responsible for this program and will be monitored by GCE to track improvements/setbacks of such program.

	
 

	
 

	
 

	
 

	
�

	
GCE Agronomist will work closely with UTPA for daily plant improvements.

	
 

	
 

	
 

	
 

	
�

	
Lodemo to provide staffing requirements for upkeep.

  

  

  

Germ Plasm & Selection 

Nursery Facilities and Operations

Management & Operations

A team of professional scientists that the will be employed by GCE and Grupo Lodemo will oversee and management and operations of these facilities. This team includes an Agronomist and the UTPA. The agronomist will oversee the fertilization and irrigation program of this area along with direct input and consultation with the team. UTPA will also aid in this process plus offer solutions and oversight and management of these facilities. More specifically, UTPA may start developing the genetic and trait selection from these facilities. This trait selection will be huge in size but this may serve as a beginning to the entire process. Grupo Lodemo would be responsible for providing the personnel needed to facilitate this process, maintain and operate these facilities. They would provide oversight of this personnel to include supervision, direction and compensation.

Shade Houses

The shade houses may play an important part in providing plantings to the Tizimin ranch. Grupo Lodemo is currently conducting an experiment to determine a higher rate of germination. This experiment includes two groups, one with trays inside the shade house and another outside, exposed to the sun continuously. This experiment may determine whether or not we will be requiring shade houses to germinate and provide plants for the ranch.

The shade house at Tebec is a structure that occupies an area of 9.5m x 21.5m (approximately 200 m2) and will provide approximately 42,500 plantings using the BBC tray system. The plantings required for the first quarter section of Pivot #1 is approximately 88,000 trees. Therefore, if we build shade houses the same size as the one in Tebec, we would need two to provide the required planting for this first quarter section.

Assuming that we have a 100% germination rate for the planting in the shade houses, we would need only two shade houses to provide for the first section. Knowing, though, that this is not the case, we will need to germinate an additional 20 to 30%, either on the side of the shade houses or build an additional shade house for this reason. This, however, depends on the efficiency of our germination system.

If we consider planting out by quarter sections of each pivot system at the ranch as described above, then all we would need is two or three shade houses. On the other hand, if we consider planting other parts of the ranch utilizing seasonal rains as the main irrigation system, as Alfonso Peon from Grupo Lodemo has been proposing, then we will need to build additional shade houses for this effort. The number of additional shade houses would depend on the size of area and number of plantings required for this area.

Irrigation

Germination of the seeds requires water, therefore, an irrigation system will need to be installed at each shade house and/or the area designated for germination. This irrigation system can be very simple and cost effective if designed to be watered by hand. 

The shade houses would be located near the main ranch house where both water and close vigilance would be provided. Locating the shade houses near to the existing ranch house would benefit from the close proximity of the existing well at the ranch and no additional drilling of wells would be required for this effort. 

Perhaps an expansion tank would need to be part of this system to provide a constant rate of 30 gpm to the shade houses. Once inside each shade house, quick disconnects would be provided along the center, and above, so that the person watering the plants does not have to drag a fifty foot long hose around in the shade house. This would prevent people from tripping and falling plus not knocking things over with the hose. From each quick disconnect the "waterer" would connect his five foot long hose to water each section of the shade house.

  

  

  

Shade Clothe & Ground Cover

One of the methods to provide limited amount of sunlight to the plantings that has been discussed, but not fully understood, is the method of switching out shade clothes that allow 90, 75 and 50% of sunlight to penetrate each shade house. The changing out of each of this clothes will have to discussed and determined as to their longevity, meaning, how long each shade cloth will need to be over each shade house until the next one is required.

A lining called "Ground Cover" will also need to be considered to protect the ground, under each shade house, from weeds growing under them. This cover would not allow weeds to grow underneath them nor penetrate them. 

Seed Varieties and Availability

Transportation and importing

Seeds for cultivation are available from a different number of sources, both, from within Mexico and outside of Mexico. The initial attempt to purchase seeds from Brazil and India has been a slow and a delaying process. Given this experience, planning for unforeseen delays and/or other obstacles is a must. Oversea varieties have to go through a stringent inspection process at the port of entry and through Mexican customs. 

Transportation and importing of seeds from overseas varies in time depending on whether you transport them through air or sea. The earliest and fastest way to ship these seeds is through air cargo as it takes approximately three weeks which includes the required regulatory documentation and sanitation processes. Sea cargo takes approximately thirty days longer than air but the cost of this cargo is less expensive than air cargo by one fourth the price. 

Air or sea cargo would be arriving at the port of Veracruz, Mexico and aside from the 15 to 45 day shipment time, we still need to allow for another seven to ten days for clearance, at customs, plus transportation to Merida Yucatan. Therefore, we should allow from 30 to 60 days for importing of seeds, depending on whether through air or sea.

The quality of seeds has not yet been determined but is something that will be learned through our genetic and trait selection process and through experience. The purchase of seeds will probably be a "one time" event since once acquiring the seeds and through geminating, they will be put through the genetic and trait selection process, allowing us to harvest seeds from our plants. This will allow for specific selection of the best varieties through cross pollination and the germination processes.

Therefore, the purchasing of seeds must be done with enough time to allow for warehousing.

  

  

  

Purchasing & Availability

The purchase of seeds is available through a number of sources as well but the costs per kilo vary. Seeds for cultivation are available from within Mexico and from other parts of the world as you can see in the list below. This list was developed as a plan to acquire seeds from within Mexico and outside of Mexico. We have included six varieties from Mexico and six from around the world. The list is as follows:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
q

	
Seed Varieties and Availability

	
 

	
 

	
 

	
 

	
 

	
 

	
a)

	
Origins 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
1.

	
Mexico

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
a.

	
Yucatan

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
b.

	
Chiapas

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
c.

	
Tabasco

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
d.

	
Morelos

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
e.

	
Morelia - Michoacan

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
f.

	
Veracruz

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
2.

	
Argentina

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
3.

	
Brazil

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
4.

	
India

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
5.

	
Cambodia

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
6.

	
Guatemala

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
7.

	
Honduras

Warehousing/Storage

The storage or shelf life of the seed, we understand, depends on the environment and the storage conditions of the seed. We understand that they must be stored in a dry and cool environment to extend the shelf life.

Analysis of seeds

All seeds, from all different origins, will be tested and analyzed for oil content percentage, weight of each seed, and quantity/quality of protein. This will help in our genetic and trait selection as it is developed. With this information, we can compare each of these qualities of seeds with the ones that are germinated and cross pollinated as our program advances.

  

  

  

Cuttings

Farm Development 

The development of the Tizimin ranch will be accomplished in phases but with the goal to have all two thousand hectares planted out with Jatropha carcus by the end of the year. It is important to note that there are three different pivot irrigation systems on the property already and that the development of this land will start with Pivot #1, the one closest to the Ranch house.

This farm sits approximately 12 miles northeast of Tizimin, Yucatan, Mexico and is approximately 110 miles from Merida and the port of Progresso and 75 miles from Cancun. Careful planning and coordination will need to be conducted for delivery of all necessary equipment and trips taken to the ranch since it is not conveniently accessible to Merida, our home base.

SITE ASSESMENT & TAKE-OVER PLAN

A detailed site assessment should be conducted as soon as we take over the ranch. This site assessment should include a detailed inventory of all structures (homes, houses) barns, garages, equipment, wells, electrical lines and power, water, wells, and other existing assets included with the ranch. The condition of the all of the Pivot systems is under way and is being conducted prior to this take over to try to speed up the process of clearing, planting and irrigation.

RANCH HOUSE PREPARATION

Preparation of ranch houses and sleeping quarters will have to be one of the first duties/requirements when overtaking the ranch. It is important to have a place to rest and sleep when the project site is far away from any city.

The main house will need to be identified and repairs needed must be documented during the initial site evaluation of the ranch. All required improvements and repairs must be noted along with furnishings required for your typical home. Furnishings should include but not be limited to beds, dresser drawers, lamps, night stands, kitchen chairs and tables, living room sofas and chairs, desks and chairs, telephone (land line), and other necessary items. This house must have a working bathroom with shower and all the necessary toiletries to include towels, soap, paper, and all other necessary items. Pots, pans, dishes, spoons, cups, glasses and all other necessary cook ware necessary to be able to provide and have required meals at the ranch and not have to eat out every day.

The ranch foreman's quarters or house will also need to be identified. All required repairs and improvements must also be documented at time of initial site assessment. A list of all required furnishings and necessities should be included as well for this house.

A home for the Regador (waterer) and his family should also be identified. All the necessary furnishings and required items to live at the ranch should be provided form them. This home should be close to the main house and the bunk house available to the ranch hands so that the regador's wife can easily feed the men on a daily basis. 

An option to the regador's wife would be to hire a full time cook with an assistant and provide a sleeping quarter for them plus provide a mess hall so that all ranch hands can have a place to eat during the week.

The ranch hands, or laborers, must also have a place to rest and sleep. A bunk house should be identified for them and all necessary furnishings should be provided to them as well. 

  

  

  

SUPPLY WAREHOUSE & REPAIR SHOP

A supply warehouse is needed to provide maintenance and repairs for all farm equipment. This structure will provide storage for all tools, machinery and equipment and an area for providing repairs to all farm equipment. 

A well conditioned space will be assigned and maintained as storage for all the seed purchased for germination. Cooling and dehumidification will be required for this storage as well as proper shelving or storage compartments for the different varieties purchased.

The repair shop will be stocked with all necessary tools for the mechanic to include, but not limited to the following:

	
 

	
 

	
 

	
 

	
a.

	
Welder and Equipment

	
 

	
 

	
 

	
 

	
b.

	
Tools for Mechanics

	
 

	
 

	
 

	
 

	
c.

	
Cutting Tools 

	
 

	
 

	
 

	
 

	
d.

	
Air Compressor (portable)

	
 

	
 

	
 

	
 

	
e.

	
Hydraulic Jacks/Wenches

	
 

	
 

	
 

	
 

	
f.

	
Grease Guns/Machine

	
 

	
 

	
 

	
 

	
g.

	
Lube Oil Tank/Pump

Storage facilities for diesel and used oil should be provided in this area as well. This area should be contained in case of an oil or fuel spill.

SMALL EQUIPMENT PURCHASES

Equipment for operating and maintaining the farm should be considered at the beginning of the operation. This equipment would be the necessary to begin operations when the land is purchased and taken over. The basic list is as follows:

	
 

	
 

	
 

	
 

	
a.

	
Small Truck for Foreman/Attendant

	
 

	
 

	
 

	
 

	
b.

	
Small Truck for the Regador (waterer)

	
 

	
 

	
 

	
 

	
c.

	
Small Truck for the Velador (night watchman)

	
 

	
 

	
 

	
 

	
d.

	
Small Truck for laborers

	
 

	
 

	
 

	
 

	
e.

	
Three Ton Truck

	
 

	
 

	
 

	
 

	
f.

	
Portable Generator

	
 

	
 

	
 

	
 

	
g.

	
Base Telephone (Land Line) 

	
 

	
 

	
 

	
 

	
h.

	
Portable Radios

	
 

	
 

	
 

	
 

	
i.

	
Four Horses w/ Tack

	
 

	
 

	
 

	
 

	
j.

	
Four ATVs with Trailer 

  

  

  

IRRIGATION

There are three pivot irrigation systems already in place at the ranch, number one pivot in Santa Eulalia section, number two at San Jose and number three in Santa Cruz. Neither of them is in working order and will need some work to be able to get them to working conditions again.

Valmont Corporation is in the process of providing us with a proposal to refurbish and get pivot #1 back on line and working again. Our efforts will be concentrated on this pivot for clearing and planting once this pivot is on line again.

CLEARING OF LAND

A comprehensive clearing plan needs to be prepared as a necessity and will be accomplished as we take over the ranch and start clearing Pivot #1. A contractor will be selected to accomplish this task and may be asked to provide this plan themselves if they have enough experience to do this themselves. A good property survey will be required not only for this task but to be able to plan soil sampling and location of new wells and or structures needed for the plantation. But regardless of what needs to happen down the road, a good survey will help us develop the farm in a much simplified manner.

GCE has a preference to cut or knock down weeds, brush and trees and compost the debris back into the ground, on site. It is customary in Yucatan to pile all of the debris and burn them but burning 2000 Ha would serve as negative publicity to this project. Either way, the land has to be cleared in a safe but expeditious way. We might find that a combination of both clearing methods might serve us better but we must make every effort to maintain a positive outlook on the project but still be productive and efficient in the process.

Clearing of the land is going to start at Pivot #1 at only one of the quarter sections of the system which is approximately thirty three hectares. Clearing will start as soon as we are able to take over the ranch, and in parallel, the refurbishment of the irrigation system as well. Once the irrigation system is in place and in working order, we will start planting right behind the clearing efforts.

In parallel to clearing of this area in Pivot #1, an area selected by the team will also be cleared to be able to take advantage of the rainy season, an area which will not require an irrigation system installed right away but will be installed soon after the rainy season is over. This will help us in energy costs and labor and materials cost for a new irrigation system.

Another option that may be taken is to have three different crews working on all three Pivot systems to get them ready for irrigation plus also have a crew at each pivot for clearing and planting. We can contract for clearing of pivot #1 but that does not mean that we cant clear the rest of the pivots and the remaining farm ourselves given the time and resources to do it.

Once we know the methodologies and ways to clear the land, we can accomplish this task ourselves, if given the time and resources to do it. Below is a list of equipment that would be necessary to accomplish this task and aid us in completing this in a much faster way.

  

  

  

Equipment Plan - Farming Equipment Selection and Acquisition

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Clearing Equipment

	
 

	
 

	
 

	
 

	
 

	
�

	
Bulldozers

	
 

	
 

	
 

	
 

	
 

	
 

	
�

	
Tractors - Agricultural

	
 

	
 

	
 

	
 

	
 

	
 

	
�

	
Discs - implementation

	
 

	
 

	
 

	
 

	
 

	
 

	
�

	
Roller - implementation

	
 

	
 

	
 

	
 

	
 

	
 

	
�

	
Tractors

	
 

	
 

	
 

	
 

	
 

	
 

	
�

	
Agricultural Tractors

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Bull Dozer

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
�

	
Implements for tractors

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Discs

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Screeds

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Flat bed trailer

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Rastras Agricultural

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Rastra Heavy

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Chapiadora/desvadorara

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Fumigadora - of pesticides

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Bombas of backpack - to fight the hierva

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Renta of Machinery for the spring cleaning

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Maintenance equipment

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Welder and Equipment

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Tools for Mechanics

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Cutting Tools (For brush & weeds, I think)

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Air Compressor (portable)

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Hydraulic Jacks/Wenches

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Grease Machine

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Lube Oil Tank/Pump

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Daily Use equipement

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
3/4 ton Pick ups

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
o

	
Flat bed trailers

  

  

  

CLEARING FORMAT

The order in which the land will be cleared will depend on which of the pivots can be refurbished easier and faster. Pivot #1 is the most accessible at this time and the type of brush, weeds, or trees are of low lying vegetation and may be easier to clear than the other two pivot systems. Since irrigation is one of the most important necessities to the growth of the plant, we will clear in and around the existing pivot irrigation systems. Clearing will commence in this order:

	
 

	
 

	
 

	
 

	
1.

	
Pivot #1 - 132 hectares (total)

	
 

	
 

	
 

	
 

	
 

	
One fourth of this circle (33 hectares) will be cleared first. Once the clearing is completed in this area, it will be irrigated once the irrigation system is up and running.

	
 

	
 

	
 

	
 

	
2.

	
Pivot #2 - 63 hectares (only 50% of the area can be irrigate at this time) The surrounding terrain will allow the pivot to circulate only to a half circle. The same concept of clearing can be accomplished with this pivot as with number one.

	
 

	
 

	
 

	
 

	
3.

	
Pivot #5 - 145 hectares

	
 

	
 

	
 

	
 

	
 

	
This pivot is the one that will require more refurbishment. The Valmont Corporation will provide us with detail on what it will take to bring this and the other pivot systems on line. The clearing format for this area still unknown since we have not yet taken over the ranch and have not yet done the site assessment or clearing plan.

	
 

	
 

	
 

	
 

	
4.

	
Areas that will be cleared later (according to the clearing plan)

CLEARING CRITERIA 

Soft Weeds- It is estimated that the tractor with a heavy rake can clear approximately 2 ha/day, which will require three tractors with rakes/disks to achieve 6 Ha/Day = 6 ha/day x 5 days/week = 30 ha/week x 4 weeks/month = 120 ha/ month

Low Lying - With a tractor hauling a roller to knock down the weeds can advance 1 ha/day x 5 days/week = 5 ha/week x 4 week/month = 20 ha/month

	
 

	
 

	
 

	
 

	
�

	
1 tractor = 20 ha/month

	
 

	
 

	
 

	
 

	
�

	
2 tractor = 40 ha/month

	
 

	
 

	
 

	
 

	
�

	
3 tractor = 60 ha/month

	
 

	
 

	
 

	
 

	
�

	
4 tractor = 80 ha/month

	
 

	
 

	
 

	
 

	
�

	
5 tractor = 100 ha/month

High forest - This area will require a Bulldozer, D6 � D7, to knock down the forest/jungle and to push debris into piles. The Bulldozer can clear approximately 1 Ha/day. The debris can be milled or burned, depending on how fast we need to do away with the debris. 

1 ha/day x 5 days/week = 5 ha/week x 4 week/month = 20 ha/month

	
 

	
 

	
 

	
 

	
i.

	
1 Bulldozer = 20 ha/month

	
 

	
 

	
 

	
 

	
ii.

	
2 Bulldozer = 40 ha/month

	
 

	
 

	
 

	
 

	
iii.

	
3 Bulldozer = 60 ha/month

	
 

	
 

	
 

	
 

	
iv.

	
4 Bulldozer = 80 ha/month

	
 

	
 

	
 

	
 

	
v.

	
5 Bulldozer = 100 ha/month

  

  

  

PLANTING STRATEGIES

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
a.

	
Sistema y patr�n de siembra circular (planning circular layout)

	
 

	
 

	
 

	
 

	
 

	
i.

	
Cuantas plantas germinaremos al mismo tiempo?

	
 

	
 

	
 

	
 

	
 

	
 

	
ii.

	
Que variedades alternar�amos en siembra

	
 

	
 

	
 

	
 

	
 

	
 

	
iii.

	
Tiempo de permanencia - con protecci�n de 90%, 70% y 50%.

	
 

	
 

	
 

	
 

	
 

	
b.

	
Propagaci�n

	
 

	
 

	
 

	
 

	
 

	
i.

	
Cortes/varas 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
1.

	
Transplantadas de Tebec en canastas, cubetas o' a' raiz desnuda?

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
ii.

	
Semillas

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
1.

	
Sembrada a Mano, O'

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
2.

	
Sembrada con maquinaria

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
iii.

	
Pl�ntulas

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
1.

	
Sembrada a Mano, O'

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
2.

	
Sembrada con maquinaria

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
�

	
Facilities Plan - Utilities, Irrigation & Office Facilities

	
 

	
 

	
 

	
 

	
 

	
Valmont to provide a detailed report of existing conditions cost estimate for repair of each pivot system.

	
 

	
 

	
 

	
 

	
 

	
a.

	
Mobius to provide plan for future irrigation systems.

	
 

	
 

	
 

	
 

	
 

	
 

	
b.

	
Team to review and concur.

	
 

	
 

	
 

	
 

	
 

	
 

	
c.

	
This irrigation plan shall be implemented along with the clearing plan for each phase. 

	
 

	
 

	
 

	
 

	
 

	
Irrigation or Seasonal

	
 

	
 

	
 

	
 

	
o

	
Irrigation:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
a)

	
Design or inspections of irrigation systems

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
b)

	
Application for subsidy to the federal government for new installations, or to salvage, the pivot system.

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
c)

	
The conditioning or implementation of the irrigation system

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
d)

	
Rain demand analysis or report of weekly watering needs

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
e)

	
It programs of irrigation

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Temporary

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
a)

	
Determining the program of work according to the stations of the year

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
b)

	
Implementar system of irrigation to help and for time specific

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
d.

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Fertilizer Plan

	
 

	
Irrigation & Fertilization program

	
 

	
 

	
 

	
 

	
e.

	
Selected Agronomist to provide a detailed program for this site.

	
 

	
 

	
 

	
 

	
 

	
 

	
f.

	
UTPA to help with oversight of condition and improvement and plants.

	
 

	
 

	
 

	
 

	
 

	
 

	
g.

	
 

	
 

	
 

	
 

	
 

	
 

	
�

	
Pesticide & Fungicide Plan

	
 

	
 

	
 

	
 

	
 

	
i.

	
Disease and Plague control

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
1.

	
Plauges - Common rat and rabbits

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
i.

	
Aplication of pesticides

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
ii.

	
Capture and identification of insects

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
iii.

	
Insecticide program.

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
2.

	
Diseases

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
i.

	
Technical advise - Agr�nomo Abelardo Navarrete

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
�

	
Logistics Plan

	
 

	
 

	
 

	
 

	
�

	
Transportaci�n de germoplasma

	
 

	
 

	
 

	
 

	
 

	
a.

	
Flete de cami�n de 10 toneladas para llevar todos los cortes de Tebec a' Tizim�n.

	
 

	
 

	
 

	
 

	
 

	
 

	
b.

	
Equipo

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
i.

	
Herramienta de mano

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
1.

	
palas

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
2.

	
carruchas

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
3.

	
pico

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
4.

	
martillos

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
5.

	
marros

  

  

  

Exhibit E

Construction Budget

RESUMEN GENERAL

GENERAL SUMMARY

	
 

	
 

	
 

	
 

	
 

	
COMEDOR EMPLEADOS

	
 

	
$

	
407,550.00

	
 

	
EMPLOYEES DINING ROOM

	
 

	
 

	
 

	
 

	
CASA ENCARGADO

	
 

	
$

	
160,544.00

	
 

	
FOREMAN'S HOUSE

	
 

	
 

	
 

	
 

	
CASA PRINCIPAL

	
 

	
$

	
698,244.00

	
 

	
MAIN HOUSE

	
 

	
 

	
 

	
 

	
GALERAS

	
 

	
$

	
975,764.00

	
 

	
LARGE SHEDS

	
 

	
 

	
 

	
 

	
SUMA

	
 

	
$

	
2,242,102.00

	
 

	
15% IVA

	
 

	
$

	
336,315.30

	
 

	
TOTAL

	
 

	
$

	
2,578,417.30

	
 

	
 

	
 

	
 

	
 

	
 

	
APROX USD

	
 

	
$

	
234,401.00

	
 

	
 

	
 

	
 

	
 

	
 

	
TIEMPO DE CONSTRUCCION

	
 

	
 

	
4 MESES

	
 

	
CONSTUCTION TIME

	
 

	
 

	
4 MONTHS

	
 

ARQ LUIS GARCIA RIERA

  

  

  

PRECIO UNITARIO

	
 

	
 

	
ATENCION:

	
MVZ. ALFONSO PEON

	
OBRA:

	
 

	
EMPRESA:

	
 

	
CONCEPTO:

	
Analista de precio para la preparacion de tierra para la siembra con rodillo o rastra.

	
 

	
 

 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
UNIDAD: Ha

	
 

	
 

	
ANALISIS No. 2021

	
 

	
FECHA: 10 DE MARZO DEL 2008

	
 

	
CONCEPTO

	
 

	
 

	
UNIDAD

	
 

	
CANTIDAD

	
 

	
P.U.

	
 

	
IMPORTE

	
 

	
REANTA TRACTOR D85

	
 

	
 

	
HORAS

	
 

	
 

	
1

	
 

	
$

	
650.00

	
 

	
$

	
650.00

	
 

	
COMBUSTIBLE

	
 

	
 

	
LITRO

	
 

	
 

	
30

	
 

	
$

	
6.27

	
 

	
$

	
188.10

	
 

	
OPERADOR

	
 

	
 

	
HORAS

	
 

	
 

	
0.125

	
 

	
$

	
250.00

	
 

	
$

	
31.25

	
 

	
AYUDANTE

	
 

	
 

	
HORAS

	
 

	
 

	
0.125

	
 

	
$

	
100.00

	
 

	
$

	
12.50

	
 

	
RENTA PASTRA O RODILLO

	
 

	
 

	
HORAS

	
 

	
 

	
1

	
 

	
$

	
90.00

	
 

	
$

	
90.00

	
 

	
PRECIO DIRECTO

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
$

	
971.85

	
 

	
INDIRECTO CAMPO 3%

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
$

	
29.16

	
 

	
SUBTOTAL

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
$

	
1,001.01

	
 

	
UTILIDAD 20%

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
$

	
200.20

	
 

	
PRECIO TOTAL HORA

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
$

	
1,201.21

	
 

	
TIEMPO POR HECTAREA

	
 

	
 

	
HORAS

	
 

	
 

	
1.6

	
 

	
$

	
1,921.93

	
 

	
 

	
 

	
 

(Son mil novesciectos veintiun pese 93/100)ex1019.htm

Exhibit 10.19

 

SALE AND PURCHASE AGREEMENT

AMONG

GLOBAL CLEAN ENERGY HOLDING, INC.

AND

MDI ONCOLOGY, INC.

AND

CURADIS GMBH

Dated

November 16, 2009

  

1

  

 

SALE AND ASSET PURCHASE AGREEMENT

 

This Sale and Asset Purchase Agreement (this “Agreement”, which term is intended to include all exhibits, schedules and other documents attached hereto or referred to herein) is made and entered into as of November 16, 2009 (the “Effective Date”) by and between Global Clean Energy Holdings, Inc., a Utah corporation formerly known as Medical Discoveries, Inc. (“GCEH”), and MDI Oncology, Inc., a Delaware corporation (“MDI” and collectively with GCEH, “Sellers”), whose principal places of business are located 6033 West Century Blvd., Suite 895 Los Angeles, CA  90045, and Curadis GmbH (“Curadis”), whose principal place of business is Henkestr. 91, 91052 Erlangen, Germany.  Individually GCEH, MDI and Curadis shall be referred to as a “Party” and collectively as the “Parties.”

 

RECITALS

 

GCEH and MDI purchased substantially all of the intellectual property assets of Savetherapeutics AG a German company in liquidation pursuant, to an agreement with its liquidator, dated March 11, 2005 (the “Savetherapeutics Contract”), as a result of which Sellers own, among other things, patents, patent applications, pre-clinical study data and ancillary clinical trial data concerning “SaveCream”, a developmental topical aromatase inhibitor cream (the “Product”).

 

The Parties have entered into a letter, dated August 25, 2009, regarding the acquisition by Curadis of all of Sellers’ rights under the Savetherapeutics Contract, and all intellectual property and other rights owned by Sellers, whether subsequently acquired or developed by or though the efforts of Sellers or otherwise, which are related to the Product.

 

NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations and warranties herein, the Parties agree as follows:

 

ARTICLE 1

DEFINITIONS

 

For purposes of this Agreement, the following definitions shall apply unless specifically stated otherwise:

 

1.1 “Affiliate” shall mean, with respect to any Person, any other Person controlling, controlled by or under direct or indirect common control with such Person. A Person shall be deemed to control a corporation (or other entity) if such Person possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of such corporation (or other entity), whether through the ownership of voting securities, by contract or otherwise.

 

1.2 “Agreement” shall have the meaning set forth in the heading of this document.

 

1.3 “Assigned Contracts” shall have the meaning set forth in Section 3.2(a) of this Agreement.

 

1.4 “Australian Patent” shall mean the patent granted to Sellers (Pub. No. AU 751040) in Australia.  The Parties acknowledge that the Australian Patent has lapsed and that Curadis has agreed to use its good faith efforts to cause the Australian Patent to be re-instated.

 

1.5 “Closing” shall have the meaning set forth in Section 4.1(b).

 

1.6 “Co-Development Contract” shall mean that certain Definitive Master Agreement, dated July 29, 2006, entered into between MDI and Eucodis Forschungs-und Entwicklungs GmbH.

 

1.7 “Collateral” shall have the meaning set forth in Section 2.5 of this Agreement.

 

 

  

2

  

 

 

1.8 “Confidential Information” shall have the meaning set forth in Section 8.1 of this Agreement.

 

1.9 “Covered Product” shall mean (a) the Product, and (b) any other cosmetic, pharmaceutical, diagnostic, therapeutic or other product that cannot be manufactured, used, sold, offered for sale without infringing one or more valid claims under the Patents Rights, whether or not such product is manufactured, used, distributed or sold by Curadis or any of its Affiliate.

 

1.10 “Curadis” shall have the meaning set forth in the heading of this Agreement.

 

1.11  “Effective Date” shall have the meaning set forth in the heading of this Agreement.

 

1.12  “Encumbrance” shall mean any title defect, mortgage, assignment, pledge, hypothecation, security interest, lien, charge, option, claim of others or encumbrance of any kind.

 

1.13  “First Commercial Sale” shall mean the first sale of any Covered Product.

 

1.14 “GCEH” shall have the meaning set forth in the heading of this Agreement.

 

1.15 “MDI” shall have the meaning set forth in the heading of this Agreement.

 

1.16 “Net Sales” shall means the gross amount received on sales by Curadis or any of its Affiliates and or licensees of Covered Products, less the following: (a) amounts repaid or credited by reason of rejection or return; (b) to the extent separately stated on purchase orders, invoices, or other documents of sale, any taxes or other governmental charges levied on the production, sale, transportation, delivery, or use of a Covered Product which is paid by or on behalf of Curadis, its Affiliates or any licensees; and (c) outbound transportation costs prepaid or allowed and costs of insurance in transit.

 

In any transfers of Covered Products between Curadis and an Affiliate or a licensee, Net Sales shall be calculated based on the final sale of the Covered Product to an independent third party.  In the event that Curadis or an Affiliate or a licensee receives non-monetary consideration for any Covered Products, Net Sales shall be calculated based on the fair market value of such consideration.

 

In the case of sales of a product that contains a Covered Product component and at least one other essential functional component (“Combination Products”), Net Sales means the gross amount billed or invoiced on sales of the Combination Product.

 

1.17  “Parties” shall have the meaning set forth in the heading of this Agreement.

 

1.18  “Patent Rights” shall mean all of Sellers’ right, title and interest in the patents and patent applications acquired under the Savetherapeutics Contract or in connection therewith, and any other patent and/or patent application listed in Exhibit 1.18 attached hereto, and any division, continuation, continuation-in-part, renewal, extension, reexamination or reissue of each such patent and any and all corresponding U.S. and foreign counterpart patent applications or patents.

 

1.19 “Product” shall have the meaning set forth in the Recitals to this Agreement.

 

1.20 “Purchased Assets” shall mean:

 

(a) All of the intellectual property and all contractual and other rights, if any, acquired by Sellers pursuant to the Savetherapeutics Contract;

 

(b) All of the intellectual property and all contractual and other rights acquired by Sellers pursuant to the Co-Development Contract;

 

 

  

3

  

 

 

(c) Any and all Patent Rights, inventions, discoveries, rights in confidential data (including know-how and trade secrets), manufacturing methods and processes, trademarks, trade names, brand names, logos, trade dress, copyrights and other intellectual property and goodwill associated with the Product, owned or under contract to acquire by Sellers, in each case whether registered or unregistered, and including without limitation all applications for and renewals or extensions of such rights, and all similar or equivalent rights or forms of protection;

 

(d) Any regulatory files and data relating to the Product owned by Sellers, including without limitation marketing authorization procedures and preclinical and clinical studies; and,

 

(e) All rights of Sellers under the Assigned Contracts.

 

1.21 “Purchase Price” shall have the meaning set forth in Section 3.1 of this Agreement.

 

1.22 “Person” shall mean any individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture or other entity of any kind.

 

1.23 “Russian Patent” shall mean the patent initially granted to SW Patentverwertungs GmbH (Pub. No. RU 2225206) in Russia.  The Parties acknowledge that the Russian Patent has lapsed and that Curadis has agreed to use its good faith efforts to cause the Russian Patent to be re-instated.

 

1.24 “Savetherapeutics Contract” shall mean the agreement with the liquidator of Savetherapeutics AG, a German company in liquidation, dated March 11, 2005, attached to this Agreement as Exhibit 1.24.

 

1.25 “Schmidt Litigation” shall mean the lawsuit between MDI and Dr. Alfred Schmidt currently pending before a court in Hamburg, Germany.

 

1.26 “Sellers” shall have the meaning set forth in the heading of this Agreement.

 

1.27 “Transfer Documents” shall have the meaning set forth in Section 2.5 of this Agreement.

 

 

  

4

  

 

 

ARTICLE 2

SALE, ASSIGNMENT AND TRANSFER OF PURCHASED ASSETS

 

2.1 Subject to the terms and conditions set forth in this Agreement and in reliance upon the representations and warranties of the Parties herein set forth, at the Closing Sellers shall sell, assign, transfer, and convey, as the case may be, the Purchased Assets to Curadis, and Curadis shall purchase the Purchased Assets.  Title to all of the Purchased Assets shall be delivered to Curadis at the Closing.

 

2.2 The Purchased Assets shall be sold, assigned, transferred, conveyed and delivered to Curadis free of any and all liabilities, obligations and encumbrances except only for those listed in Exhibit 2.2.

 

2.3 Upon the Closing, all of the Purchased Assets and all non-publicly available information relating thereto shall be considered to be Confidential Information belonging to Curadis, and the Sellers  shall no longer have any rights thereto or therein, except to the extent set forth in the Security Agreement.

 

2.4 Sellers shall be responsible for all sales, use, transfer, value added and other related taxes, imposed by the United States government, if any, arising out of the sale by Sellers of the Purchased Assets to Curadis pursuant to this Agreement, and Curadis shall be responsible for all other sales, use, transfer, value added and other related taxes arising out of the sale by Sellers of the Purchased Assets to Curadis pursuant to this Agreement.

 

2.5 Until the Purchase Price (as set forth in 3.1 below) is fully paid, Curadis shall not, without the Sellers’ prior written consent, sell, transfer or convey, as the case may be, the Purchased Assets to a third party, except for licensing in the ordinary course of business, or create or permit to be created an Encumbrance over the Purchased Assets, except for the security interest granted under  Section 2.6 of this Agreement and encumerances for taxes, assessments or government charges or claims the payment of which is not at the time required and  imposed by law.

 

 

  

5

  

 

 

2.6 As collateral security for the prompt and complete payment of the Purchase Price when due, at the Closing Curadis shall grant to the Sellers a security interest in all of  right, title and interest in all of the Purchased Assets (the “Collateral”).  The security interest granted will be senior to all other liens with respect to the Collateral, except to the extent otherwise required by law.  The grant of the security interest shall be effected by a security agreement (the “Security Agreement”), the form of which is set forth in Exhibit 2.6 attached to this Agreement.  The foregoing security interest will be released upon payment in full of the Final Payment (as defined in Section 3.1(c) below).

 

 

ARTICLE 3

PURCHASE PRICE; TIMING OF PAYMENTS; DISCHARGE OF CERTAIN DEBTS

 

3.1 The purchase price for the Purchased Assets (the “Purchase Price”) and the rights under the Agreement shall be 4,200,000 euros, subject to reduction as set forth below.  The Purchase Price shall be payable as follows:

 

	
(a)  

	
Deposit Payment - 50,000 euros, which amount was delivered to Sellers on September 8, 2009 following the execution and delivery of the August 25, 2009 letter agreement.  Sellers hereby acknowledge receipt of the 50,000 euros payment.

 

	
(b)  

	
Closing Payment – 300,000 euros to be delivered at the Closing by bank transfer to GCEH on behalf of Sellers.

 

	
(c)  

	
Final Payment - 2.0 Million euros (the “Final Payment”).  The Final Payment shall be paid from the following sources:

 

	
(i)  

	
Curadis will pay Sellers a royalty based on of 2% of Net Sales derived from direct commercialization of Covered Products by Curadis or one of its Affiliates.

 

	
(ii)  

	
In the event that Curadis grants a license to a product that constitutes a Covered Product or which otherwise includes a license to any of the intellectual property rights transferred as part of the Purchased Assets, Sellers will receive the following:

 

	
a.  

	
Curadis will pay Sellers 5% from any “up front license fee,” “milestone payment” or other lump sum payment that Curadis receives from time to time from such licensor.

 

	
b.  

	
if the license agreement between Curadis and a licensee provides that the licensee is obligated to pay a royalty equal to 4% of Net Sales or less, then Curadis shall pay to Sellers one half (50%) of the royalties that such licensee is required to pay under the license (the other 50% of such royalty shall be payable to Curadis).

 

 

  

6

  

 

 

	
c.  

	
if the license agreement between Curadis and a licensee provides that the licensee is obligated to pay a royalty of more than  4% of Net Sales, then Curadis shall ensure that the licensee pays to Sellers 2% of the Net Sales generated by the licensee (any excess royalty shall be paid to Curadis).

 

After Sellers have received an aggregate amount of 2 Million euros  under this Section 3.1(c) equal to the Final Payment, all future income and/or royalty payments shall be made to, and belong to Curadis.

 

Notwithstanding the foregoing, the amount of the Final Payment may be reduced as follows: (i) If before the later of December 31, 2010 or the date of the First Commercial Sale the Russian Patent is not re-instated, the Final Payment shall be reduced by 100,000 euros;  (ii)  If before the later of December 31, 2010 or the date of the First Commercial Sale the Australian Patent is not re-instated, the Final Payment shall be reduced by 100,000 euros.  Curadis may pre-pay the Final Payment, in whole or in part, at any time without any penalty.

 

	
(d)  

	
Obtaining the full release of the Sellers’ obligations to pay the liquidator of Savetherapeutics AG, any future payments, including the remaining 1,850,000 euro unpaid portion of the purchase price under the Savetherapeutics Contract.

 

3.2           In addition to the foregoing payments of the Purchase Price, on the Closing, Curadis shall assume and shall be financially responsible for:

 

(a)           Sellers’ actual or potential obligation to Marc Kessemeier under the Consulting Agreement between Marc Kessemeier and Sellers or otherwise, provided that Curadis shall not be responsible for any amount over 21,000 euros.

 

(b)           Sellers’ actual or potential obligation to Prof. Dr. Wieland, provided that Curadis shall not be responsible for any amount over 205,000 euros.

 

(c)           The financial obligations of Sellers arising under the assigned contracts attached to this Agreement as Exhibit 3.2(a); provided, however, that the benefit of each of such assigned contracts (the “Assigned Contracts”) has been validly assigned to Curadis in accordance with the terms thereof.

 

(d)           To the extent not paid by Curadis prior to the Closing, all fees and costs arising after August 25, 2009 related to (i) the prosecution and maintenance of any of the patents or patent applications included in the Purchased Assets (including the payment of all patent filing and maintenance fees payable to any U.S., European or other patent office, and all legal fees payable to patent lawyers, whether or not engaged by Sellers), and (ii) the Schmidt Litigation, including all legal fees and costs to be owed to Huschke-Rechtsanwaelte.

 

ARTICLE 4

CONDITIONS TO THE CLOSING; CLOSING

 

4.1.           Closing.  The Closing of the transactions contemplated hereby shall occur on or before November __, 2009 (the “Closing Date”), or such other date as the Parties may mutually agree to in writing.

 

4.2           Conditions Precedent to Curadis’ Closing Obligations  Each of the following shall be a condition to the obligation of Curadis to consummate the transactions contemplated by this Agreement, except to the extent that Curadis may elect to waive any of such conditions in writing:

 

 

  

7

  

 

 

(a)           The liquidator of Savetherapeutics shall have consented in writing to the assignment and transfer of the Savetherapeutics Contract and the Purchased Assets to Curadis, and shall have consented to the other transactions contemplated by this Agreement, to the extent such consent is necessary.

 

(b)           Curadis shall have received executed copies of all patent assignments, bills of sale and other documents and instruments necessary to sell, transfer and assign to Curadis all of the Purchased Assets.

 

(c)           Curadis shall have received a certificate, executed by the Chief Executive Officer of each Seller, confirming that (i) each of the representations and warranties made by such Seller in this Agreement is true and correct in all material respects on and as of the Closing as though such representation or warranty was made on and as of the Effective Date, as well as on and as of the Closing, and (ii) such Seller has performed and complied with, in all material respects, each agreement, covenant and obligation required by this Agreement to be so performed or complied with by such Seller at or before the Closing.

 

(d)           The Assigned Contracts listed in Exhibit 3.2(a) have been validly assigned to Curadis in accordance with the terms thereof.

 

4.3           Conditions Precedent to Sellers’ Closing Obligations  Each of the following shall be a condition to the obligation of Sellers to consummate the transactions contemplated by this Agreement, except to the extent that Sellers may elect to waive any of such conditions in writing:

 

(a)           The liquidator of Savetherapeutics shall have consented in writing to the assignment and transfer of the Savetherapeutics Contract and the Purchased Assets, and shall have consented to the other transactions contemplated by this Agreement, to the extent such consent is necessary.

 

(b)           Curadis shall have executed the Security Agreement.

 

(c)           Sellers shall have received an instrument, in form and substance reasonably satisfactory to Sellers, in which the liquidator of Savetherapeutics fully releases Sellers from any and all obligations and liabilities under the Savetherapeutics Contract, including all the obligations to pay the liquidator the remaining 1,850,000 euro unpaid portion of the purchase price under the Savetherapeutics Contract.

 

(d)           Sellers shall have received one or more instruments, in form as provided in Exhibit  4.3 (d); executed by the parties to the Assigned Contracts, in which Curadis assumes all of the obligations of Sellers under the Assigned Contracts, and Sellers are released from all obligations under the Assigned Contracts.

 

(e)           Sellers shall have received evidence, reasonably satisfactory to Sellers, that all fees, costs and other obligations required to be paid and satisfied by Curadis under Section 3.2(b) have been paid or otherwise satisfied in full.

 

(f)           Sellers shall have received a certificate, executed by the Managing Director of Curadis, confirming that (i) each of the representations and warranties made by Curadis in this Agreement is true and correct in all material respects on and as of the Closing as though such representation or warranty was made on and as of the Closing, and (ii) Curadis has performed and complied with, in all material respects, each agreement, covenant and obligation required by this Agreement to be so performed or complied with by Curadis at or before the Closing.

 

 

  

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4.4           Closing Deliveries of Sellers.  At or prior to the Closing, each Seller shall execute and deliver to Curadis:

 

(a)           Patent assignments, bills of sale and other such assignment instruments, in form and substance reasonably satisfactory to Curadis, covering the Purchased Assets and the Assigned Contracts, and otherwise effecting the full sale and conveyance of the Purchased Assets to Curadis, free and clear of all liens, security interests and other encumbrances other than those listed in this Agreement.

 

(b)           All originals, books, records, correspondence and other documents in Sellers’ possession or control that evidence or relate to the Purchased Assets and the Product;

 

(c)           The Closing certificate described above in Section 4.2(c); and

 

(d)           Such other closing documents as Curadis may reasonably request in order to consummate the transactions contemplated by this Agreement.

 

4.5           Closing Deliveries of Curadis.  At or prior to the Closing, Curadis shall execute and deliver to Sellers:

 

(a)           Payment, by bank transfer, of 300,000 euros;

 

(b)           The Closing certificate described above in Section 4.3(f);

 

(c)           The Security Agreement; and

 

(d)           Such other closing documents as Sellers may reasonably request in order to consummate the transactions contemplated by this Agreement.

 

ARTICLE 5

COVENANTS AND CONTINUING OBLIGATIONS

 

5.1           The Parties agree to jointly use their commercially reasonable efforts to obtain the consent of the liquidator of Savetherapeutics to the sale and transfer of the Purchased Assets to Curadis under this Agreement and to the other transactions contemplated hereby.  The Parties agree to cooperate in good faith in dealing with the liquidator and to persuade the liquidator to approve the proposed transactions.  Notwithstanding the foregoing, nothing herein shall require any of the Parties to make any payments to, or to otherwise provide any consideration to the liquidator in order to obtain the liquidator’s consent.

 

5.2           Sellers shall be entitled to retain one copy of any document delivered by Sellers under this Agreement, but only in their legal files for evidentiary purposes.

 

5.4           It is expressly understood and agreed that Curadis is not the successor to Sellers or any of their affiliates in their business affairs, and Curadis undertakes no responsibility, obligation or liability, expressed or implied, under any contract of Sellers that are not Assigned Contracts, and that such other contracts shall remain the sole responsibility of Sellers.

 

5.5           For the period of five (5) years from the Closing, neither of Sellers, nor any of their Affiliates shall be a party to, or assist with or undertake, either on their own, with third parties or on behalf of third parties, any research and development with respect to the Covered Product or any product which could be used in reasonable substitution thereof, nor commercialize any products based on the Covered Product, except if and as requested by Curadis.

 

 

  

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5.6           Curadis shall keep, and shall require that its Affiliates and each licensee keep, complete and accurate books of account and records in sufficient detail to enable the expenses incurred by Curadis and its Affiliates and any licensee and the amounts payable under this Agreement to be determined.  Such books and records shall be kept at the principal place of business of Curadis or its accountant, its Affiliate or such blicensee, as the case may be, for at least sixty (60) months following the end of the calendar year to which such books and records pertain; provided, however, that in the event Sellers conduct an audit and a dispute arises over the accuracy of reports or payments, Curadis, its Affiliates and each licensee, as the case may be, shall retain all applicable books of account and records and continue to permit access to such books of account and records until the resolution of such dispute.

 

5.7           Upon reasonable prior written notice from Sellers and not more than once in each calendar year until the Final Payment referred to in Section 3.1(c) has been paid in full (unless an audit reveals inaccurate reports or payments), Curadis shall permit, and shall require its Affiliates and each licensee to permit, an independent certified public accounting firm of nationally recognized standing in the United States or Germany selected by Sellers and reasonably acceptable, as the case may be,  to Curadis, its Affiliate or the licensee to have access during normal business hours to such books of account and records of Curadis, and its Affiliates and each a licensee that are relevant for calculation of the Final Payment, at such person’s or entity’s principal place of business, as may be reasonably necessary to verify the accuracy of the reports and payments provided by Curadis for any calendar year ending not more than sixty (60) months prior to the date of such request.

 

5.8           After the First Commercial Sale, Curadis shall furnish to Sellers a written report for each calendar quarter showing:  (a) the aggregate amount of gross sales and other dispositions of all Covered Products (broken-out by Covered Product) sold or other disposed of by Curadis, its Affiliates and any licensees during such calendar quarter and the calculation of Net Sales from such amount, and (b) the amount of royalties which shall have accrued under this Agreement based upon such Net Sales.  Reports to be provided by Curadis to Sellers under this Section 5.8 shall be due forty-five (45) days following the end of each calendar quarter.  If for any quarter following the First Commercial Sale, there were no Net Sales, a report stating such fact shall be due within forty-five (45) days following the end of such quarter.  A responsible financial officer of Curadis (or that officer’s responsible designee) shall certify in writing that each report provided under this Section 5.8 is correct and complete.  The obligation to provide reports under this Section 5.8 shall continue until the Final Payment referred to in Section 3.1(c) has been paid in full.

 

5.9           Curadis hereby agrees that from and after the Effective Date, Curadis shall continue to vigorously prosecute the Schmidt Litigation at the sole expense of Curadis.  After the Effective Date until the Closing, Curadis shall control and direct the Schmidt Litigation, provided that Curadis shall (x) promptly inform Sellers of all instructions that it provides Huschke-Rechtsanwaelte and of all other actions that it takes with respect to such litigation, and (y) not settle or otherwise terminate the Schmidt Litigation before the final judgment is rendered without the prior written consent of Sellers.  Sellers shall fully cooperate with Curadis in prosecuting the Schmidt Litigation at the sole expense of Curadis.  Curadis shall advance (or if paid by Sellers, reimburse) all of the reasonably incurred out-of-pocket expenses of Sellers and their representatives (including legal fees and costs), in furnishing such assistance requested by Curadis.  If Curadis elects not to step-in or take over the Schmidt Litigation in its own name, or if stepping-in/taking-over and defending the Schmidt Litigation by Curadis is not legally possible, Sellers shall continue to prosecute such litigation as instructed by Curadis, and shall not settle the claims at their own discretion unless Curadis approves such settlement in advance.  However, Curadis shall be entitled to defend and settle the Schmidt Litigation at its own discretion.  Notwithstanding anything herein to the contrary, Curadis shall not settle the Schmidt Litigation in a manner that results in monetary damages to Sellers without Sellers approval.

 

 

  

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5.10           Curadis covenants and agrees with the Sellers that from and after the date of this Agreement and until the Final Payment has been paid in full, at any time and from time to time, upon the written request of the Sellers, and at the sole expense of Curadis, Curadis will promptly and duly execute and deliver any and all such further documents and take such further action as the Sellers may reasonably deem desirable to obtain the full benefits of the security interest granted in the Collateral and of the rights and powers granted in the Security Agreement, including, without limitation, the filing of any financing statements or documents under any jurisdiction with respect to the security interests granted in the Security Agreement, the filing of any other documentation as may be required to create or perfect the security interest in any jurisdiction, and the execution, delivery and recordation of such assignments of patents as may be necessary to effectuate, perfect, and record the Sellers’ security interest in the Collateral.

 

5.11   Commencing on the Closing Date and continuing until the Final Payment has been fully satisfied, Curadis shall assume, in coordination with Sellers, full responsibility for the application, maintenance, reexamination, reissue, reinstatement, opposition and prosecution of any kind (collectively “Prosecution”) relating to the Patent Rights in all jurisdictions, including, but not limited to, payment of all costs, fees and expenses related thereto.  Curadis shall have the right to select counsel with respect to the responsibility assumed by Curadis in this Section 5.12, and Curadis shall diligently pursue the Prosecution of the Patent Rights.  Curadis shall, at Sellers’ request, provide Sellers with (i) evidence that the Patent Rights are being maintained in accordance with this Section, and (ii) copies of any and all communications with any patent authorities or patent office regarding the Prosecution of the Patent Rights.  Curadis shall obtain the prior written consent of Sellers (which consent shall not be unreasonably withheld or delayed), prior to abandoning, disclaiming, withdrawing, seeking reissue or allowing to lapse any material patent, or patent application relating to the Patent Rights listed on Exhibit 5.12.

 

 

ARTICLE 6

REPRESENTATIONS AND WARRANTIES

 

6.1           Sellers represent and warrant to Curadis as of the Effective Date and at the Closing as follows:

 

(a) Each Seller is a corporation duly and validly existing and in good standing under the laws of the state of its incorporation.  MDI is a corporation wholly-owned by GCEH.  Sellers have all requisite corporate power and authority to own their respective assets, including the Purchased Assets, and to carry on their business as presently conducted.

 

(b) Sellers have all requisite power and authority to execute and deliver and perform their obligations under this Agreement and to consummate the transactions contemplated by this Agreement.

 

(c) All acts (corporate or otherwise) required to be taken by or on the part of, and all approvals required to be obtained by, Sellers necessary to enter into this Agreement, consummate the transactions contemplated by this Agreement and perform its obligations under this Agreement have been duly and properly taken by Sellers.

 

(d) This Agreement has been duly and validly executed and delivered by Sellers, and constitutes the legal, valid and binding obligation of Sellers enforceable against Sellers in accordance with its terms, subject to applicable bankruptcy, moratorium, reorganization, insolvency and similar laws of general application relating to or affecting the rights and remedies of creditors generally and to general equitable principles (regardless of whether a proceeding is brought in equity or at law).

 

 

  

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(e) The Purchased Assets do not constitute all or substantially all of the assets of Sellers, on a consolidated basis.

 

(f) The execution and delivery of this Agreement by Sellers, the consummation by them of the transactions contemplated by this Agreement, and the performance by them of their obligations under this Agreement does not, and will not at all relevant times (i) violate or conflict with any provision of their respective Certificates of Incorporation or By-Laws, or (ii) result in a violation by Sellers of any law to which they or any of its properties or assets are subject, or (iii)  violate, or conflict with, or result in a breach of any provision of, or constitute a default (or give rise to any right of termination, cancellation or acceleration) under, any of the terms, conditions or provisions of any agreement lease, instrument, obligation, understanding or arrangement to which either of Sellers is a party or by which any of their properties or assets is subject.

 

(g) Except for the Schmidt Litigation, there is no litigation, proceeding, investigation, arbitration or claim pending, or, to the best of the knowledge of Sellers, threatened against Sellers, and there is, to the best of Sellers’ knowledge, no reasonable basis for any such action, which affects in whole or in part Sellers’ ability to consummate the transactions contemplated by this Agreement, the performance of Sellers’ obligations hereunder or the ability of Curadis to fully enjoy the Purchased Assets.

 

(h) To the best of Sellers’ knowledge, (i) the use of the Purchased Assets does not infringe intellectual property rights of third parties, except to the extent as may have been alleged in the Schmidt Litigation, (ii) the Purchased Assets are free from any liens, charges and Encumbrances or other rights of third parties, (iii) the full enjoyment of the Purchased Assets are not dependant on any rights of third parties, (iv) no fraudulent or other improper document has been filed with any third governmental agency which may invalidate any of the rights enjoyed by the Purchased Assets, and (v) the Purchased Assets are valid and enforceable against third parties, and there are no grounds for revocation, invalidation or re-examination of any of the Purchased Assets.

 

(i) No permit, consent, approval or authorization of, or declaration, filing or registration with, any governmental authority or other third party is or will be necessary to be made or obtained by Sellers in connection with (i) the execution and delivery by Sellers of this Agreement, (ii) the consummation by them of the transactions contemplated under this Agreement, or (iii) the performance by Sellers of their obligations under this Agreement.

 

(j) The Assigned Contracts are being duly assigned to Curadis at Closing and duly authorized, executed and delivered by Sellers and constitute the legal, valid and binding obligation of Sellers enforceable against Sellers in accordance with their terms, subject to applicable bankruptcy, moratorium, reorganization, insolvency and similar laws of general application relating to or affecting the rights and remedies of creditors generally and to general equitable principles (regardless of whether a proceeding is brought in equity or at law).  Sellers have not terminated the Assigned Contracts, nor have Sellers received any written notice from any of the other parties to any of the Assigned Contracts that the Assigned Contracts have been breached or terminated.

 

(k) To the best of Sellers’ knowledge, Sellers have no liability to any party to the Assigned Contracts other than the liabilities specified in the Assigned Contracts.  Sellers have not received from any party to the Assigned Contracts any written notices (i) asserting any breach of the Assigned Contracts, (ii) terminating or modifying any of the Assigned Contracts, or (iii) otherwise challenging the terms and provisions of the Assigned Contracts.

 

(l) Sellers have not granted to any third parties any rights relating to the Product or the Covered Product or relating in any way to any of the rights acquired by Sellers pursuant to the Savetherapeutics Contract, except for third party rights that have expired or been terminated.

 

 

  

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6.2           Curadis represents and warrants to Sellers as follows:

 

(a) Curadis is a company duly organized, validly existing and in good standing under the laws of Germany and has all requisite power and authority to own its assets and to carry on its business as presently conducted.

 

(b) Curadis has all requisite power and authority to execute and deliver and perform its obligations under this Agreement and the Security Agreement and to consummate the transactions contemplated by such agreements.

 

(c) All acts (corporate or otherwise) required to be taken by or on the part of, and all approvals required to be obtained by, Curadis necessary to enter into this Agreement and the Security Agreement, consummate the transactions contemplated by this Agreement and the Security Agreement, and perform its obligations under this Agreement and the Security Agreement have been duly and properly taken by Curadis.

 

(d) This Agreement and the Security Agreement have been duly and validly executed and delivered by Curadis and constitute the legal, valid and binding obligations of Curadis enforceable against Curadis in accordance with their terms, subject to applicable bankruptcy, moratorium, reorganization, insolvency and similar laws of general application relating to or affecting the rights and remedies of creditors generally and to general equitable principles (regardless of whether a proceedings is brought in equity or at law).

 

(e) The execution and delivery of this Agreement by Curadis, the consummation by it of the transactions contemplated by this Agreement, and the performance by it of its obligations under this Agreement does not, and will not at all relevant times (i) violate or conflict with any provision of its operative governing documents, (ii) result in a violation by Curadis of any law to which it or any of its properties or assets are subject, or (iii) violate, or conflict with, or result in a breach of any provision of, or constitute a default (or give rise to any right of termination, cancellation or acceleration) under, any of the terms, conditions or provisions of any agreement lease, instrument, obligation, understanding or arrangement to which Curadis is a party or by which any of its properties or assets is subject.

 

ARTICLE 7

INDEMNIFICATION

 

7.1           From and after the Closing, Sellers shall defend, indemnify and hold harmless Curadis and its officers, directors, employees, consultants and agents from and against all liabilities, claims, damages, costs and expenses (including reasonable attorney's fees) incurred by Curadis and its officers, directors, employees, consultants and agents arising from or out of (a) any breach of or inaccuracy in any representation or warranty made by Sellers in this Agreement, or (b) any breach of any covenant or agreement made by Sellers in this Agreement, (c) the Assigned Contracts, other than the agreements between Sellers and the Liquidator of Savetherapeutics AG i.L., to the extent the liability or cause for such claim was existing before or on the Effective Date, or (d) any claim against Curadis by a party to the Assigned Contracts based on Sellers’ fraud or willful misconduct under such agreements.

 

7.2           From and after the Closing, Curadis shall defend, indemnify and hold harmless Sellers and their officers, directors, employees, consultants and agents from and against all liabilities, claims, damages, costs and expenses (including reasonable attorney's fees) incurred by Sellers and their officers, directors, employees, consultants and agents arising from or out of (a) any breach of or inaccuracy in any representation or warranty made by Curadis in this Agreement, (b) any breach of any covenant or agreement made by Curadis in this Agreement, or (c) the Assigned Contracts to the extent the liability or cause for such claim was created after the Effective Date.

 

 

  

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7.3           No obligation of indemnification shall arise relating to a third party claim or cause of action unless the indemnified Party making such claim shall: (a) notify the indemnifying Party of such claim promptly upon becoming aware of the existence or threatened existence of any such claim giving rise to, or that may give rise to a claim of indemnification hereunder, and (b) allow the indemnifying Party full control over the defense of such claim, and (c) cooperate in the defense of such claim at the indemnifying Party’s expense.  Notwithstanding any contrary provision in this Article, the failure to so notify, provide information and assistance shall not relieve the indemnifying Party of its obligations to the indemnified Party hereunder unless, and then only to the extent that the indemnifying Party is materially prejudiced thereby.  If the indemnifying Party does not timely acknowledge its indemnification obligation hereunder with respect to such claim, or does not defend such claim, the indemnified Party shall have the right, but not the obligation, to defend and settle such claim until such time as the indemnifying Party acknowledges in writing its indemnification obligation hereunder with respect to such claim or elects in writing to defend and settle such claim in accordance with the indemnification provisions herein.  The indemnified Party shall, at its own cost, have the right to participate in any legal proceeding, settlement negotiation or other like event, and to contest and defend a claim and to be represented by legal counsel of its choosing, but shall have no right to settle a claim without the prior written approval of the indemnifying Party.

 

7.4           Each Party shall cooperate with and provide to the other all information and assistance which the latter may reasonably request in connection with any claim entitling any party to indemnification hereunder.

 

7.5           No party shall be responsible for or bound by any settlement that imposes any obligation on it that is made without its prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed.

 

7.6           For avoidance of any doubt, this Section applies to the situation when (a) all Parties are named defendants, as well as (b) any one Party is named a defendant and deems that it may have any right to recourse or indemnification against the other Party under this Agreement.

 

7.7           The foregoing indemnification provisions are in addition to, and not in derogation of or to the exclusion of, any statutory or common law remedy any Party may have for breach of representation, warranty, or covenant.

 

ARTICLE 8

CONFIDENTIALITY

 

8.1           For purposes of this Agreement, “Confidential Information” shall mean information and data in any medium, including oral, written or electronic, disclosed in connection with this Agreement, relating to the Purchased Assets or the transactions contemplated by this Agreement, along with any trade secrets, business information, technical information, or marketing information that the party disclosing the information deems confidential and has appropriately marked as such prior to disclosing such information to the receiving party.  The terms and conditions of this Agreement (but not its existence) are deemed to be Confidential Information that shall not be disclosed to third parties without the written consent of the Parties, with the exception of any regulatory filings (including, without limitation, Sellers’ obligation to file a report on Form 8-K with the U.S. Securities and Exchange Commission and to issue a press release in connection with the execution and delivery of this Agreement), press releases as set forth in Section 9.12, or disclosures to investors or shareholderes that a Party may be required to make under either applicable laws and regulations.  Irrespective of the foregoing, Confidential Information shall not include information that (a) was reported as nonconfidential by either Party in writing prior to disclosure, (b) was lawfully in the public domain prior to Closing, or becomes publicly available other than through breach of this Agreement, (c) is publicly disclosed pursuant to legal, judicial or administrative proceedings or otherwise required by law (including, without limitation, regulations promulgated by the U.S. Securities and Exchange Commission), subject to Sellers giving all reasonable prior notice and assistance to Curadis to allow it to seek protective or other court orders, (d) is approved for release in writing by Curadis, and/or (e) Curadis will use in order to exercise its rights under this Agreement, including but not limiting to, required disclosure made to regulatory and other authorities, and disclosures made pursuant to confidentiality agreements to its Affiliate(s) and potential partners and licensees.  From and after the Closing, all Confidential Information relating to the Purchased Assets shall be deemed to be Confidential Information belonging to Curadis.

 

 

  

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8.2           Each Party shall:

 

(a)           strictly protect and maintain the confidentiality of the Confidential Information belonging to the other Party with at least a reasonable standard of care that is no less than that which they use to protect similar confidential information of their own;

 

(b)           not disclose, nor allow to be disclosed, the Confidential Information belonging to the other Party to any person other than to employees, consultants and counsel, on a need to know basis; provided, however, that such recipients of the Confidential Information are bound by obligations of confidentiality no less strict than those contained herein;

 

(c)           unless otherwise expressly provided for in this Agreement, not use the Confidential Information belonging the other Party for any purpose other than in relation to the exercise of its rights and obligations under this Agreement; and,

 

(d)           take all necessary precautions to restrict access of the Confidential Information belonging to any other Party to unauthorized personnel; and immediately notify the Party to which the Confidential Information belongs in the event of any unauthorized disclosure or loss of such Confidential Information.

 

8.3           Sellers shall not publish or otherwise disclose any Confidential Information about or in relation to the Purchased Assets generated or known to them before or after the Effective Date, without the explicit prior written approval of Curadis.

 

8.4           No Party shall assert that anything disclosed or discussed constitutes a waiver of attorney-client privilege or attorney work-product.

 

8.5           The Parties acknowledge and agree that monetary damages may not be adequate in the event of a default under this Article and that the non-defaulting Party shall be entitled, without the posting of a bond, to seek injunctive relief by a court or other body granting such relief, in which event such relief or receipt of monetary damages shall not constitute an election of remedies; and the non-defaulting Party is independently entitled to each and every remedy available by law for a default under this Article.

 

8.6           The provisions of this Article, from and after the Effective Date, shall supersede and fully replace any confidentiality obligations established between the Parties in relation to the Purchased Assets prior to the Effective Date.

 

ARTICLE 9

MISCELLANEOUS

 

9.1           Notice.  All notices, requests, demands or other communications to or upon the respective Parties hereto shall be deemed to have been given or made the earlier of (a) actual receipt or refusal to accept receipt, (b) two (2) business days after deposit with a recognized overnight courier service, (c) receipt by facsimile or electronic means, when such delivery is confirmed by the recipient or his agent, or (d) five business days after mailing when deposited in the mails, registered mail or certified, return receipt requested, postage prepaid, addressed to the respective party at the following address (or to such other person or address as is specified elsewhere in this Agreement for specific purposes):

 

 

  

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If to Curadis:                         Curadis GmbH

Henkestr. 91,

91052 Erlangen, Germany

Attention to: Martin Windisch

 

If to Global Clean Energy Holdings, Inc. (Medical Discoveries, Inc.) or MDI Oncology, Inc.:

 

Global Clean Energy Holdings, Inc.

6033 W. Century Blvd, Suite 895

Los Angeles, CA 90045

Attention: Richard Palmer

 

The above addresses for receipt of notice may be changed by any Party by notice, given as provided herein, which notice shall be effective only upon actual receipt.

 

9.2           Entire Agreement.  This Agreement contain the entire understanding of the Parties with regard to the transactions contemplated by this Agreement, superseding in all respects any and all prior oral or written agreements or understandings pertaining to the subject matter hereof.  This Agreement can be amended, modified or supplemented only by an agreement in writing which is signed by the Parties to be charged.

 

9.3           Incorporation of Exhibits and Schedules.  The Exhibits, Appendices and Schedules attached to this Agreement are incorporated herein and are hereby made a part of this Agreement.

 

9.4           Severability.  If and to the extent that any court of competent jurisdiction holds any provision or part of this Agreement to be invalid or unenforceable, such holding shall in no way affect the validity of the remainder of this Agreement before any other court or in any other jurisdiction.

 

9.5           Successors and Assigns.  This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of the Parties.

 

9.6           Assignment.                      The benefits of this Agreement (but not the obligations set forth hereunder) can be assigned or otherwise transferred in whole or in part by either party without the transferring party receiving prior written consent of the other party; provided, however, that the rights of the non-transferring party under this Agreement remain unaffected.

 

9.7           Waiver.  A waiver by any party of any of the terms and conditions of this Agreement in any instance shall not be deemed or construed to be a waiver of such term or condition for the future.

 

9.8           Headings.  Headings in this Agreement are included for ease of reference only and have no legal effect.

 

9.9           Counterparts.  This Agreement may be executed in two or more counterparts (the Parties intend to execute six counterparts), each of which shall be deemed an original and all of which together shall constitute one and the same instrument.

 

9.10           Applicable Law.   This Agreement shall be governed by and construed in accordance with the laws of the Federal Republic of Germany, without regard to the principles of conflicts of law. Any dispute arising out of or in connection with this contract, including any question regarding its existence, validity or termination, shall be referred to and finally resolved by arbitration under the UNCITRAL Arbitration Rules, which Rules are deemed to be incorporated by reference into this clause.  Any arbitration commenced pursuant to this clause shall be administered by the London Court of International Arbitration (LCIA).  The appointing authority shall be the LCIA. The standard LCIA administrative procedures and schedule of costs shall apply.  The number of arbitrators shall be one.  The place of arbitration shall be London, England.  The language to be used in the arbitral proceedings shall be English.  The governing law of the contract shall be the substantive law of Federal Republic of Germany.  The arbitrators shall apportion the expenses of the arbitration (including the legal fees and expenses incurred by the parties) between the parties. Any judgment of the arbitrators shall be enforceable in any court of competent jurisdiction.

 

 

  

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9.11           Further Assurances.  The Parties shall provide, grant and/or execute any additional documents or declarations and shall provide any other assistance that may reasonably be requested to enable Curadis to acquire and manage the Purchased Assets properly and in full.  Except (a) as otherwise provided herein to the contrary, and (b) for the costs of recording any assignments to Curadis for the Patent Rights in patent offices worldwide, which cost shall be at the expense of Curadis, each of the Parties shall bear its own expenses, including without limitation the expenses relating to the duplication and delivery of documents and the expenses relating to the preparation of this Agreement, the documents referred to herein and the actions being taken (whether before or after the Effective Date) to enable such Party to comply with its representations, warranties, covenants and agreements contained herein.

 

9.12           Press Release.  The Parties shall have the right to issue press releases relating to its entry into this Agreement; provided, however, that prior to release, the releasing Party provides the other Parties with a draft of the press release in sufficient time for the non-releasing Party to comment on the release.  At no time shall any Party issue a release which places the other Parties at risk with any governmental authority as such relates to its public company position.

 

9.13           Termination of Agreement.  Curadis or Sellers may terminate this Agreement as provided below:

 

(a)           Curadis and Sellers may terminate this Agreement by mutual written consent of all three parties at any time prior to the Closing Date;

 

(b)           Subject to Section 9.13(f) below, Curadis may terminate this Agreement by giving written notice to Sellers at any time prior to the Closing Date in the event Sellers are in breach, and Sellers may terminate this Agreement by giving written notice to Curadis at any time prior to the Closing Date in the event Curadis is in breach, of any material representation, warranty, or covenant contained in this Agreement in any material respect; provided, however, that the party in breach shall have ten calendar days to cure such breach;

 

(c)           Curadis may terminate this Agreement by giving written notice to Sellers at any time prior to the Closing Date if the Closing shall not have occurred on or before the 30th day following the date of this Agreement by reason of the failure of any condition precedent under Section 4.2 above (unless the failure results primarily from Curadis itself breaching any representation, warranty, or covenant contained in this Agreement);

 

(d)           Sellers may terminate this Agreement by giving written notice to Curadis at any time prior to the Closing Date if the Closing shall not have occurred on or before the 30th day following the date of this Agreement by reason of the failure of any condition precedent under Section 4.3 (unless the failure results primarily from Sellers breaching any representation, warranty, or covenant contained in this Agreement);

 

 (e)           In the event of a termination of this Agreement by Curadis or Sellers pursuant to this Section 9.13 (other than pursuant to Section 9.13(b)), all obligations of the parties hereunder shall terminate without liability of any party to any other party.  The termination of this Agreement by either party shall not adversely affect any right that a party may have against another party for breach of contract.

 

  

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SIGNATURE PAGE

 

 

In Witness Whereof, the Parties have caused this Agreement to be duly executed in their respective names and on their behalf, on the date first above written.

 

 

	
Curadis GmbH

 

By: /s/ CURADIS GMBH

Title: _________________________

	
Global Clean Energy Holdings, Inc.

 

By: /s/GLOBAL CLEAN ENERGY HOLDINGS, INC.

Title: _________________________

	  	
MDI Oncology, Inc.

 

By: /s/MDI ONCOLOGY, INC.

Title: _________________________

  

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EXHIBIT 1.24

Savetherapeutics Contract

ASSIGNMENT AND ASSUMPTION

AND

CONSENT AGREEMENT

THIS AGREEMET AND ASSUMPTION AND CONSENT AGREEMNT (this “Agreement”) is made as of November ___, 2009 by and among Global Clean Energy Holdings, Inc., a Utah corporation formerly known as Medical Discoveries, Inc. (“Assignor”), Curadis GmbH, a company existing under the laws of the Federal Republic of Germany (“Assignee”), and Attorney Hinnerk-Joachim Mueller as liquidator od Savetherapeutics AG, a German company in liquidation (the “Liquidator”), with reference to the following facts:

WHEREAS, Assignor (then known as “Medical Discoveries, Inc.”) and the Liquidator are parties tot htat certain Sale and Purchase Agreement, dated March 11, 2005, as amended by a side letter (collectively, the “Savetherapeutics Contract”);

WHEREAS, Assignor and MDI Oncology, Inc., Assignor’s wholly-owned subsidiary, on the hand, and Assignee on the other hand, are parties to a certain Sale and Purchase Agreement, dated as of November 16, 2009, (the “Purchase Agreement”); and

WHEREAS, in connection with the transactions contemplated by the Purchase Agreement, Assignor desires to transfer to Assignee any and all right, title and interest it may have in, to and under the Savetherapeutics Contract, and Assignee desires to assume all of Assignor’s responsibilities and obligations in, to and under the Savetherapeutics Contract; and

WHEREAS, the Liquidator is willing to (i) consent to the assignment and assumption of the Savetherapeutics Contract to Assignee, and (ii) release the Assignor from any further obligation and liability under Savetherapeutics Contract.

NOW, THEREFORE, in consideration of the foregoing, of the mutual covenants of the parties hereto, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledge, it is hereby agreed as follows:

	
1.  

	
Assignment of Rights and Benefits. Effective as of November ___, 2009 (the “Closing Date”), Assignor hereby assigns, transfers and sets over unto Assignee, all of the right, title and internet of Debtor in, to and under the Savetherapeutics Contract.

 

	
2.  

	
Assumption of Duties by Assignee. Effective as of the Closing Date, Assignee, for itself and its successors and permitted assigns, hereby accepts and assumes and agrees to pay, perform and discharge when due all covenants, conditions, agreements, terms and obligations to be performed by Assignor under the Savetherapeutics Contract accruing or arising before or after the Closing Date (the “Assumed Liabilities”), subject to the covenants, conditions and other provisions contained therein.

 

 

  

20

  

 

 

	
3.  

	
Consent and Ratification. The Liquidator hereby consents to (i) the assignment of the Savetherapeutics Contract by Assignor to Assignee, and (ii) the assumption by

 

	
4.  

	
successor’s or assigns any rights or remedies of any nature or kind whatsoever under or by reason of this Agreement.

 

	
5.  

	
Amendment. This Agreement may not be modified or changed except by written instruments signed by all of the parties hereto. Subject to the restrictions on assignment set forth herein this Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns.

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

  

 

EXHIBIT 2.2

 

Encumbrances on Purchased Assets

	
1.  

	
Claims made by Dr. Alfred Schmidt and Prof. Dr. Wieland regarding rights he may have to certain of the intellectual property included in the Purchased Assets, including those matters in dispute in the Schmidt Litigation.

	
2.  

	
Rights to certain of the Purchased Assets retained by the Liquidator of Savetherapeutics AG i.L.

	
3.  

	
Encumbrances in favor of Sellers to be enacted pursuant to the Security Agreement

 

  

21

  

  

22

  

SECURITY AGREEMENT

This Security Agreement (the “Agreement”) is entered into as of November 17, 2009, by and between Curadis GmbH (“Debtor”), with its chief executive office located a Henkestr. 91, 91052 Erlangen, Germany in favor of Global Clean Energy Holdings, Inc., a Delaware corporation (“Secured Party”), with its chief executive office located at 6033 West Century Blvd., Suite 895 Los Angeles, CA 90045, U.S.A., with reference to the following facts:

RECITALS:

	
A.  

	
Pursuant to the Sale and Asset Purchase Agreement, entered into as of the November 13, 2009 by and between Debtor and Secured Party and MDI Oncology, Inc. (the wholly-owned subsidiary of Secured Party) (the “Sale Agreement”), Debtor acquired, as of Closing, certain intellectual property and other rights, including all of the rights of Secures Party and MDI Oncology, Inc. to the patents and/or patent applications listed in Schedule B to this Agreement.

 

	
B.  

	
Pursuant to the Sale Agreement, Debtor has agreed to pay Secured Party and MDI Oncology, Inc. that certain Final Payment based on the commercial exploitation of the Covered Products.

 

	
C.  

	
Pursuant to the Sale Agreement, Debtor agreed to (i) grant Secured Party and MDI Oncology. Inc. a security interest in the Purchased Assets as security for Debtor’s obligations to pay the Final Payment under the Sale Agreement, and (ii) execute and deliver this Security Agreement, and to grant to Secured Party and MDI Oncology, Inc. a security interest in the Purchased Assets.

 

	
D.  

	
Secured Party, being the sole shareholder of MDI Oncology, Inc. is acting as the representative of MDI Oncology, Inc. for the purposes of this Agreement.

 

AGREEMENT:

NOW THEREFORE, in consideration of the promises and mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged, Debtor hereby agrees as follows:

	
1.  

	
Definitions. In this Agreement, all terms and expressions shall, in the absence of contrary intention or unless otherwise defined in this Agreement, have the meanings attributed to such terms in the Sale Agreement.

 

	
2.  

	
Grant of Security Interest in Intellectual Property Collateral. As security for the Obligations (as defined in paragraph 3 below), Debtor hereby grants to Secured Party a continuing firs-priority (except to the extent otherwise required by law) security interest (the “Security Interest”) in all of Debtor’s right, title, and interest in, to and under the Patent Rights and the other intellectual property constituting the Purchased Assets (collectively, the “Intellectual Property Collateral”).

 

 

  

23

  

 

 

	
3.  

	
Obligations Secured. This Agreement is given for the purpose of securing, as a first-priority security interest, the following obligations of Debtor to Secured Party and MDI Oncology, Inc. (the “Obligations”):

 

	
(1)  

	
The obligation of Debtor to Secured Party to pay the Final Payments, as defined in Section 3.1(c) of the Sale Agreement, according to the terms thereof; and

 

	
(2)  

	
Prompt performance and observation of Debtor’s duties under Section 5.12 of the Sale Agreement.

 

	
4.  

	
Events of Default: Remedies.

 

	
(1)  

	
The occurrence of any of the following events or conditions shall constitute and is hereby defined to be an “Event of Default”:

 

	
(a)  

	
A failure to make any royalty payments as part of the Final Payment, which payment default continues unremedied for a period of thirty (30) calendar days after notice of such default or violation to Debtor;

 

	
(b)  

	
A material default to comply with Section 5.12 of the Sale Agreement, which default continues unremedied for a period of thirty (30) calendar days after notice of such default or violation to Debtor; and

 

	
(c)  

	
Debtor shall go bankrupt, initiates a voluntary bankruptcy procedure, or in case the bankruptcy procedure against Debtor has been brought.

 

	
(2)  

	
Upon the occurrence of any Event of Default, and at any time while such Event of Default is continuing, Secured Party may do one or more of the following:

 

	
(a)  

	
Declare the remaining unpaid portion of the Final Payment immediately due and payable, and the same, with all costs and charges, shall be collectible thereupon by actin at law.

 

	
(b)  

	
Without further notice or demand and without legal process, take possession of the Intellectual Property Collateral wherever found. Debtor, upon demand by Secured Party, shall take whatever actions are deemed necessary by the Secured Party to deliver to the Secured Party full possession and control of the Intellectual Property Collateral.

 

	
(c)  

	
Pursue any legal remedy available to collect the Obligations, to enforce its title in and right to possession of the Intellectual Property Collateral, and to enforce any and all other rights or remedies available to it.

 

 

  

24

  

 

 

	
(d)  

	
Upon giving Debtor such notice as is required by law, enforce Intellectual Property Collateral at public sale or by other means permitted by applicable law.

 

	
(3)  

	
The Proceeds of any sale of all or any part of the Intellectual Property Collateral shall be applied as follows:

 

	
(a)  

	
First, to the payment of the reasonable costs and expenses, including reasonable attorney’s fees and legal expenses, incurred by Secured Party in connection with (A) the administration of this Agreement, (B) the custody, preservation, or the sale of, or other realization upon, the Intellectual Property Collateral, or (C) the exercise or enforcement if any of the rights of Secured Party hereunder;

 

	
(b)  

	
Second, to the payment of the remaining undisputable and unpaid portion of the Final Payment; and

 

	
(c)  

	
Third, the surplus proceeds, if any, to Debtor or to whomsoever shall be lawfully entitled to receive the same or as a court of competent jurisdiction shall direct.

 

	
(4)  

	
Secured Party so far as may be lawful, may purchase all or any part of the Intellectual Property Collateral offered at any public sale made in the enforcement of Secured Party’s rights and remedies hereunder.

 

	
(5)  

	
Debtor shall pay all reasonable costs and expenses, including without limitation, court costs and reasonable attorneys, fees, incurred by Secured Party in enforcing payment and performance of the Obligations or in exercising the rights and remedies of Secured Party hereunder.

 

	
(6)  

	
In addition to the remedies provided herein for an Event of Default, Secured Party shall have the rights and remedies afforded a secured party under applicable law. No failure on the part of Secured Party to exercise any of its rights hereunder arising upon any Event of Default shall be construed to prejudice its rights upon the occurrence of any other or subsequent Event of Default. No delay on the part of Secured Party in exercising any such rights shall be construed to preclude it from the exercise thereof at any time while that Event of Default in continuing. Secured Party may enforce any one or more remedies or rights hereunder successively or concurrently. By accepting payment or performance of any of the obligations after it due date, Secured Party shall not thereby waive the agreement contained herein that time is of essence, its right to require prompt payment or performance when due of the remainder of the obligations, or its right to consider the failure to so pay or perform an Event of Default.

 

	
5.  

	
Miscellaneous Provisions.

 

 

  

25

  

 

 

	
(1)  

	
Debtor waives and agrees not to assert: (i) any right to require Secured Party to proceed against, or to pursue any other remedy available to Secured Party, or to pursue any remedy in any particular order or manner; (ii) the benefits of any legal or equitable doctrine or principle of marshaling; and (iii) demand, diligence, presentment for payment, protest and demand, and notice of dishonor, protest, demand and nonpayment, relating to the Obligations.

 

	
(2)  

	
Until an Event of Default, Debtor may retain possession and control of the Intellectual Property Collateral and may use it in any lawful manner consistent with this Agreement or the Sale Agreement.

 

	
(3)  

	
No modification, rescission, waiver, release or amendment of any provision of this Agreement shall be made except by a written agreement signed by a duly authorized officer of Secured Party.

 

	
(4)  

	
This Agreement shall remain in full force and effect until all of the Final Payment shall have been paid in full.

 

	
(5)  

	
No setoff or claim that Debtor now has or may in the future have against Secured Party shall relieve Debtor form paying or performing the Obligations.

 

	
(6)  

	
This Agreement shall be binding upon, and shall inure to the benefit of , the parties hereto and their successors and assigns.

 

	
(7)  

	
A photographic or other reproduced copy of this Agreement and/or any financing statement relating hereto shall be sufficient for filling and/or recording as a financing statement.

 

	
(8)  

	
Upon the payment in full of the Final Payment, the security interest granted herein and this Agreement shall terminate, and all rights to the Collateral shall revert to Debtor. Upon any such termination, Secured Party and MDI Oncology, Inc., will at Debtor’s sole expense, promptly execute and deliver such documents as Debtor shall reasonably request to evidence such termination.

 

	
(9)  

	
This Agreement shall be governed and construed in accordance with the laws of the Federal Republic of Germany, without regard to the principles of conflicts of law. Any dispute arising out of or in connection with this contract, including any question regarding its existence, validity or termination, shall be referred to and finally resolved by arbitration under the UNCITRAL Arbitration Rules, which Rules are deemed to be incorporated by reference into this clause. Any arbitration commenced pursuant to this clause shall be administered by the London Court if International Arbitration (LCIA). The appointing authority shall be the LCIA. The standard LCIA administrative procedures and schedule of costs shall apply. The number of arbitrators shall be one. The place of arbitration shall be London, England. The language to be used in the arbitral proceedings shall be English. The governing law of the contract shall be the substantive law od Federal Republic of Germany. The arbitrators shall apportion the expenses of the arbitration (including the legal fees and expenses incurred by the parties) between the parties. Any judgment of the arbitrators shall be enforceable in any court of competent jurisdiction.

 

 

  

26

  

 

 

IN WITNESS WHEREOF, the Debtor has caused this Agreement to be signed in its name by its duly authorized officer.

Curadis GmbH.               

                                                                                              

AGREED AND ACCEPTED

Global Clean Energy Holding, Inc.

    By:   

 

 

Debtor: Curadis GmbH

Secured Party: Global Clean Energy Holdings, Inc.

SCHEDULE A TO SECURITY AGREEMENT

DESCRIPTION OF COLLATERAL

All of Debtor’s right, title and interest, whether acquired under the Sale Agreement or hereafter created or acquired, in and to the following described intellectual property (collectively, the “Intellectual Property Collateral”):

	
(1)  

	
All of Debtor’s rights in and to the patent and/or patent application listed in Schedule B attached hereto, and any division, continuation-in-part, renewal, extension, reexamination or reissue of each such patent and any and all corresponding U.S. and foreign counterpart patent applications or patents please link this to Exhibit 1.16 of the Sale Agreement.

	
(2)  

	
All other Purchased Assets, as defines in the Sale Agreement.

  

27

  

 

EXHIBIT 3.2(a)

Assigned Contracts

	
1.  

	
Asset Purchase Agreement between Attornay Hinnerk-Joachim Muller as Liquidator of Savetherapeutics AG i.L. and Medical Discoveries, Inc.

 

	
2.  

	
Side Letter to the Asset Purchase Agreement between Attorney Hinnerk-Joachim Muller as Liquidator of Savetherapeutics AG i.L. and Medical Discoveries, Inc.

 

	
3.  

	
Assignment of Patent, Participation, and Research and Development Agreement between Medical Discoveries Oncology, Inc. and Prof. Dr. Heinrich Wieland.

 

	
4.  

	
Amendment No. 1 to the Assignment of Patent, Participation, and Research and Development Agreement between Medical Discoveries Oncology, Inc. and Prof. Dr. Heinrich Wieland.

 

	
5.  

	
Consulting Agreement between Marc Kessemeier and Medical Discoveries, Inc.

 

AGREEMENT

THIS AGREEMENT (the “Agreement”) is made as of December 11th, 2009 by and among Prof. Dr. Heinrich Wieland, In der Wiehre 13, 79291 St. Peter, Germany (hereinafter: “Creditor”), Global Clean Energy Holdings, Inc., a Utah corporation formerly known as Medical Discoveries, Inc. (“GCEH”) and MDI Oncology, Inc., a Delaware corporation (“MDI” as collectively with GCEH, “Debtor”), and Curadis GmbH, a company existing under the laws of  the Federal Republic of Germany, Henkestr. 91, 91052 Erlangen, Germany (“Assumptor”), with reference to the following facts:

WHEREAS, Debtor and Creditor are parties to that certain Assignment of Patent-Participation-, Research and Development Agreement, dated August 2, 2005, as amended by Amendment No. 1 (collectively, the “Wieland Contract”);

WHEREAS, Debtor and Assumptor are parties to a certain Sale and Purchase Agreement, dated as of November 16, 2009, (the “Purchase Agreement”); and

WHEREAS, in connection with the transactions contemplated by the Purchase Agreement, Debtor desires to transfer to Assumptor any and all right, title and interest it may have in, to and under the Wieland Contract, and Assumptor desires to assume the Debtor’s financial obligations under the Wieland Contract, as stipulated in Sec. 2 and 3 below; and

WHEREAS, Creditor is willing to (i) consent to the transfer of the benefits of Wieland Contract to the Assumptor, and (ii) release the Debtor from its obligation and the Debt under the Wieland Contract.

NOW, THEREFORE, in consideration of the foregoing, of the mutual covenants of the parties hereto, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledge, it is hereby agreed as follows:

 

 

  

28

  

 

 

	
1.  

	
Assignment of Rights and Benefits. Effective as of December ___, 2009 (the “Closing Date”), Debtor hereby assigns, transfers and sets over unto Assumptor, all of the right, title and internet of Debtor in, to and under the Wieland Contract.

 

	
2.  

	
Assumption of Debt. Effective as of the Closing Date, Assumptor hereby accepts and assumes and agrees to pay the Creditor Debtor’s debt under the Wieland Contract, in the amount of 205,000 euros (in words: two-hundred-five-thousand euros) (the “Debt”), subject to the covenants, conditions and other provisions contained therein.

 

	
3.  

	
Consent and Ratification. Creditor hereby consents to (i) the assignment, transfer and setting over unto Assumptor of Debtor’s right, title and interest in, to and under the Wieland Contract, and (ii) the assumption of the Debt by the Assumptor, all as of the Closing Date.

 

	
4.  

	
Release. By the assumption of the Debt, as set out in Sec 2 and 3 above, the Assumptor steps into the shoes of the Debtor, and the Debtor is forever released and discharged from the financial and other obligations and liabilities under the Wieland Contract.

 

	
5.  

	
Further Acts. Each party agrees that it shall, upon the request of the other, executed and deliver such further documents and do so such other acts and things as are reasonably necessary and appropriate to effectuate the terms and conditions of this Agreement.

 

	
6.  

	
Binding Effect. This Agreement and all provisions hereof will be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

 

	
7.  

	
Headings. Headings are provided herein for convenience only and shall not serve as a basis for interpretation or construction of this Agreement, not as evidence of the intention of the parties hereto.

 

	
8.  

	
Governing Law. In any action brought by or against the Liquidator, this Agreement shall be governed and construed in accordance with the laws of the Federal Republic of Germany, with the exception of German international private law and the UN Convention on Contracts for the International Sale of Goods. Any dispute between Debtor and Assumptor regarding this Agreement shall be governed but the choice of law, jurisdiction and other provisions of Section 9.10 if the Purchase Agreement.

 

	
9.  

	
Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute but one and the same instrument.

 

	
10.  

	
Amendment. This Agreement may not be modified or changed except by written instruments signed by all of the parties hereto.

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

 

	
“DEBTOR”

 

 

 

Global 

	 	
 “ASSUMPTOR”

 

 

 

Curadis GmbH

	 
	By:	 	 By:	 

 

                                                                   

  

29

  

 

 

 

By:                                                 

 

AGREEMENT

THIS AGREEMENT (the “Agreement”) is made as of December 11th, 2009 by and among Marc A. Kessemeier, An der Rothalde 9/1, 79312 Emmendingen, Germany (“Creditor”), Global Clean Energy Holdings, Inc., a Utah corporation formerky known as Medical Discoveries, Inc. (“Debtor”), and Curadis GmbH, a company existing under the laws of  the Federal Republic of Germany, Henkestr. 91, 91052 Erlangen, Germany (“Assumptor”), with reference to the following facts:

WHEREAS, Debtor and Creditor are parties to that certain Consultancy Agreement, dated March, 2005 (the “Kesseneier Contract”);

WHEREAS, Debtor and Assumptor are parties to a certain Sale and Purchase Agreement, dated as of November 16, 2009, (the “Purchase Agreement”); and

WHEREAS, in connection with the transactions contemplated by the Purchase Agreement, Debtor desires to transfer to Assumptor any and all right, title and interest it may have in, to and under the Kessemeier Contract, and Assumptor desires to assume the Debtor’s obligations under the Kessemeier Contract, as stipulated in Sec. 2 and 3 below; and

WHEREAS, Creditor is willing to (i) consent tot eh transfer of the benefits of Kessemeier Contract to the Assumptor, and (ii) release the Debtor from its obligation and the Debt under the Kessemeier Contract.

NOW, THEREFORE, in consideration of the foregoing, of the mutual covenants of the parties hereto, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledge, it is hereby agreed as follows:

 

 

  

30

  

 

 

	
1.  

	
Assignment of Rights and Benefits. Effective as of December ___, 2009 (the “Closing Date”), debtor hereby assigns, transfers and sets over unto Assumptor, all of the right, title and internet of Debtor in, to and under the Kessemeier Contract.

 

	
2.  

	
Assumption of Kessemeier Agreement and the Debt. Effective as of the Closing Date, Assumptor hereby accepts and assumed the Kessemeier Contract and agrees to pay the Creditor Debtor’s debt under the Kessemeier Contract, which amount Creditor hereby agrees is no more than 21,000 euros ( in words: twenty-one-thousand euros) (the “Debt”), subject to the covenants, conditions and other provisions contained therein.

 

	
3.  

	
Consent and Ratification. Creditor hereby consents to (i) the assignment, transfer and setting over unto Assumptor of Debtor’s right, title and interest in, to and under the Kessemeier Contract, and (ii) the assumption of the Kessemeier Contract, including the Debt, by the Assumptor, all as of the Closing Date.

 

	
4.  

	
Release. By the assumption of the Debt, as set out in Sec 2 and 3 above, the Assumptor steps into the shoes of the Debtor, and the Debtor is forever released and discharged from the financial and other obligations and liabilities under the Kessemeier Contract.

 

	
5.  

	
Further Acts. Each party agrees that it shall, upon the request of the other, executed and deliver such further documents and do so such other acts and things as are reasonably necessary and appropriate to effectuate the terms and conditions of this Agreement.

 

	
6.  

	
Headings. Headings are provided herein for convenience only and shall not serve as a basis for interpretation or construction of this Agreement, not as evidence of the intention of the parties hereto.

 

	
7.  

	
Binding Effect. This Agreement and all provisions hereof will be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

 

	
8.  

	
Governing Law. In any action brought under this Agreement shall be governed and construed in accordance with the laws of the Federal Republic of Germany. Any dispute between Debtor and Assumptor regarding this Agreement shall be governed but the choice of law, jurisdiction and other provisions of Section 9.10 if the Purchase Agreement.

 

	
9.  

	
Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute but one and the same instrument.

 

	
10.  

	
Amendment. This Agreement may not be modified or changed except by written instruments signed by all of the parties hereto.

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

 

 

  

31

  

 

 

	
“DEBTOR”

  

  

Global Clean Energy Holdings, Inc. 

	 	
“ASSUMPTOR”

  

  

  

Curadis GmbH

	 
	By:	 	By:	 
	Richard Palmer, CEO	 	Martin Windsch	 

 

“CREDITOR”

 

Marc A. Kessemeier

 

  

32

  

 

 

  

33

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