Document:

exhibit_10-13.htm

Exhibit 10.13

SECURITY AGREEMENT

 

THIS SECURITY AGREEMENT (the “Security Agreement”) made as of the 31st day of May, 2007, by and between NATHANIEL ENERGY CORPORATION, a Delaware corporation with its principal place of business at 8001 South InterPort Blvd., Suite 260 Englewood, CO 80112 (“Debtor”) and RICHARD C. STRAIN, an individual residing at 15 Loockerman Avenue, Poughkeepsie, New York  12601 (“Secured Party”).

 

WHEREAS, Debtor is indebted to Secured Party pursuant to Promissory Note in the  principal sum of TWO HUNDRED THOUSAND AND 00/100 ($200,000.00) DOLLARS (the “Loan”); and

 

WHEREAS, in connection with and in consideration of Secured Party’s extension of the  Loan, Borrower has agreed to grant Secured Party a security interest in the assets of Borrower.

 

NOW, THEREFORE, subject to the terms and conditions set forth in this Agreement, the parties hereto agree as follows:

 

1.  Grant of Security Interest.  In consideration of (i) the extension of the Loan from Secured Party to Debtor and (ii) any other loans, advances, or other financial accommodations at any time at or after the date hereof effectively made or extended by the Secured Party to or for the account of Debtor, directly or indirectly, as principal, guarantor or otherwise, including any obligations which Debtor may have to the Secured Party (the “Indebtedness”), Debtor hereby grants to Secured Party a continuing first priority security interest in, assignment of and right of setoff against the Collateral described in Paragraph 2 hereof to secure the payment, performance and observance of (a) all obligations, liabilities and agreements of any kind of Debtor to the Secured Party, now existing or hereafter arising, direct or indirect, absolute or contingent, secured or unsecured, due or not, arising out of or relating to the Indebtedness (all of the foregoing being herein referred to as the “Obligations”) and (b) all agreements, documents and instruments evidencing any of the foregoing or under which any of the foregoing may have been issued, created, assumed or guaranteed (collectively the “Loan Documents”).

 

2.  Collateral.  The “Collateral” in which a security interest in favor of the Secured Party is hereby granted is described in Schedule “A” annexed hereto and made a part hereof and also includes all attachments and accessions now or hereafter affixed to the Collateral or used in connection therewith and all substitutions and replacements therefore, and all proceeds thereof (including, without limitation, claims of the Debtor against third parties for loss, damage to or destruction of any Collateral) together with all money (as that term is defined in the Uniform Commercial Code of the State of New York (the “UCC”), securities, drafts, notes, items and other property of Debtor, and the proceeds thereof, now or hereafter held or received by or in transit to the Secured party from or for Debtor, whether for safekeeping, custody, pledge, transmission, collection or otherwise, and any and all deposits (general or special), balances, sums, proceeds and credits of Debtor with, and any and all claims of Debtor against the Secured Party at any time existing.

 

  

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3.  Debtor’s Representations and Warranties.  Debtor  warrants, represents and covenants to the Secured Party that:

 

(a)           Debtor is a corporation duly organized and existing and in good standing under the laws of the State of Delaware and is duly qualified to transact business in the State of Colorado.  Debtor has full power and authority to carry out and perform its undertakings and obligations as provided herein.  The execution and delivery by Debtor of this Security Agreement and the consummation of the transactions contemplated in this Security Agreement have been duly authorized by all proper or requisite corporate proceedings and will not conflict with or breach any provision of any agreement to which Debtor is a part or by which it may be bound, the Certificate of Incorporation or Bylaws of Debtor.

 

(b)           The execution, delivery and performance by Debtor of this Agreement does not and will not contravene any contractual restriction or, any law binding on or effecting Debtor or any of its properties.

 

(c)           No consent or approval, notice to or waiver or other action is required for the due execution, delivery and performance by Debtor of this Agreement.

 

(d)           This Agreement is a legal, valid and binding obligation of Debtor, enforceable against Debtor in accordance with its terms, except as may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditor’s rights generally and (ii) general principals of equity (regardless of whether considered in a proceeding in equity or in law).

 

(e)           Debtor is the owner of and has title to all of the Collateral, free and clear of all liens and encumbrances of any kind and nature whatsoever except for liens already granted to the secured party, if any.

 

(f)           The chief executive office and other places of business of Debtor, the books and records relating to the Collateral and the Collateral are, and have been during the four (4) month period prior to the date hereof (or in the case of a new business, from the date of commencement of said business), located at the address set forth in the recitals hereinabove and Debtor will not change the same, or merge or consolidate with any person or change its name, without prior written notice to and consent of the Secured Party.

 

(g)           Debtor will use the Collateral for lawful purposes only, with all reasonable care and caution and in conformity with all applicable laws, ordinances, rules and regulations.

 

(h)           Debtor will keep all inventory and equipment if such should be part of the Collateral, in first class order, repair, running and marketable condition, at Debtor’s sole cost and expense, ordinary wear and tear and obsolescence excepted.

 

  

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(i)           The Secured Party shall at all reasonable times have ready and free access to and the right to inspect the Collateral and any records pertaining thereto (and the right to make extracts from and to receive from Debtor originals or true copies of such records and any papers and instruments relating to any Collateral upon request therefore) and Debtor hereby grants to the Secured Party a security interest in all such records, papers and instruments to secure the payment, performance and observance of the Obligations.

 

(j)           The Collateral is now and shall remain personal property, and Debtor will not permit any equipment, if such is a part of the Collateral, which is not now a fixture to become a fixture without prior written notice to and consent of the Secured Party.

 

(k)           Debtor, at its sole cost and expense, will insure the Collateral in the name of and with loss or damage payable to the Secured Party, as its interest may appear, against such risks, with such companies and in such amounts, as may be required by the Secured Party from time to time (all such policies provide for ten (10) days minimum written notice of cancellation or amendment to the Secured Party) and Debtor will deliver to the Secured Party the original or duplicate policies, or certificates or other evidence satisfactory to the Secured Party attesting thereto, and Debtor will promptly notify the Secured Party of any material loss or material damage to any Collateral and promptly file a claim therefore if covered by insurance.

 

(l)           Debtor will, at its sole cost and expense, perform all acts and execute all documents requested by the Secured Party from time to time to evidence, perfect, maintain or enforce the Secured Party’s first priority security interest granted herein or otherwise in furtherance of the provisions of this Security Agreement.

 

(m)         At any time and from time to time, Debtor shall, at its sole cost and expense, execute and deliver to the Secured Party such financing statements pursuant to the UCC, applications for certificates of title, and other papers, documents or instruments as may be requested by the Secured Party in connection with this Security Agreement, and Debtor hereby authorizes the Secured Party, at the Debtor’s expense, to execute and file at any time and from time to time one or more financing statements or copies thereof or of this Security Agreement with respect to the Collateral, signed only by the Secured Party.

 

(n)           In its discretion, the Secured Party may, at any time and from time to time, after a Default, as hereinafter defined, has occurred, in its name, the Debtor’s name or otherwise, notify any account debtor or obliger of any account, contract, document, instrument, chattel paper or general intangible included in the Collateral to make payment to or otherwise act at the direction of the Secured Party.

 

(o)           In its discretion, Secured Party may, at any time and from time to time, after a Default has occurred, demand, sue for, collect or receive any money or property at any time payable or receivable on account of or in exchange for, or make any compromise or settlement deemed desirable by the Secured Party with respect to any Collateral, and/or extend the time of payment, arrange for payment in installments, or otherwise modify the terms of, or release any Collateral or 

 

  

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Obligations, all without notice to or consent by Debtor and without otherwise discharging or affecting the Obligations, the Collateral or the security interest therein created.

 

(p)           In its discretion, Secured Party may, at any time and from time to time, for the account of Debtor, pay any amount or do any act required of Debtor hereunder, which Debtor fails to do or pay, and any such payment shall be deemed an advance by Secured Party to Debtor payable on demand together with interest at the highest rate then payable on the Obligations.

 

(q)           Debtor will pay the Secured Party for all sums, costs, and expenses which Secured Party may pay or incur pursuant to the provisions of this Security Agreement or in negotiating, executing, perfecting, defending, or protecting the security interest granted herein or in enforcing payment of the Obligations or otherwise in connection with the provisions hereof, including but not limited to court costs, collection charges, travel expenses, and reasonable attorneys fees, whether or not an action or proceeding is commenced, all of which, together with interest at the highest rate then payable on the Obligations, shall be part of the Obligations, be payable on demand and be secured hereby.

 

(r)           All proceeds and collections arising from or received with respect to accounts receivable or contract rights, if included in the Collateral, shall, but only in the event that a Default has occurred, be segregated, not be commingled with any other property of the Debtor, be held in trust for the Secured Party by Debtor and be delivered in kind by Debtor to Secured Party or its designee, with any necessary endorsement or assignment thereon.

 

(s)           Except as otherwise specifically provided in any loan agreement between the Secured Party and the Debtor, all proceeds of any Collateral received by Debtor after the occurrence of a Default or the occurrence of an event which, with the passage of time, the giving of notice or otherwise would constitute a Default, shall not be commingled with other property of Debtor, but shall be segregated, held by Debtor in trust for the Secured Party, and immediately delivered to the Secured Party in the form received, duly endorsed in blank where appropriate to effectuate the provisions hereof, the same to be held by the Secured Party as additional Collateral hereunder or, at Secured Party’s option, to be applied to payment of the Obligations, whether or not due and in any order the Secured Party may elect.

 

(t)           In its sole discretion, the Secured Party may, at any time and from time to time, assign, transfer or deliver to any transferee of any Obligations, any Collateral, whereupon the Secured Party shall be fully discharged from all responsibility and the transferee shall be vested with all powers and rights of Secured Party hereunder with respect thereto, but the Secured Party shall retain all rights and powers with respect to any Collateral not assigned, transferred or delivered.

 

4.  Default.  Any of the following events or occurrences shall constitute a “Default” under this Agreement and the Obligations:

 

(a)          The failure of the Debtor, or any other person or entity responsible, to make punctual payment of any sum payable hereunder, upon the Obligations or under any Loan Document;

 

  

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(b)           The failure of the Debtor, or any other person or entity responsible, to timely perform any Obligations to be performed by them hereunder, with respect to the Obligations or under any Loan Document; and

 

(c)           With respect to the Debtor, any maker, endorser or guarantor of, or any other party to the Obligations, each of whom is included in the term “them” as used in this paragraph; any failure to perform with respect to any liabilities or obligations to, or agreements with, Secured Party; death or dissolution; death of any shareholder/member of a corporation, partnership, limited liability company or other form of entity included in the term “them”; insolvency; calling of a meeting of creditors; making or sending a notice of an intended bulk transfer, suspension or liquidation of usual business; failure when required to furnish Secured Party with any financial information or to permit Secured Patty to inspect books and records; making any misrepresentation to Secured Party in obtaining credit; failing to pay or remit any tax when assessed or due; commencement of a voluntary or involuntary proceeding under any Federal or State bankruptcy law now or hereinafter in existence; application for the appointment of a receiver or liquidating agent or similar person; entry of a judgment against any of them (but excepting any judgment of any amount which is covered by liability insurance); issuance of an order of attachment against any of their property; failure of any of them to comply at any time with Regulation U of the Federal Reserve Board; or if at any time in the reasonable opinion of the Secured Party, the financial responsibility of any of them should become impaired.

 

5.  Rights Upon Default.  Upon the occurrence of any Default and at any time thereafter, the Secured Party shall have the right to declare the Obligations, or any of them, immediately due and payable without notice, demand or protest, all of which are hereby waived, and shall have the following rights and remedies of a secured party under the UCC or available to the Secured Party under the Obligations or Loan Documents; all such rights and remedies being cumulative, not exclusive and enforceable alternatively, successively or concurrently:

 

(a)           The right to enter at any time and from time to time, with or without judicial process or the aid and assistance of others, any premises where any Collateral may be located;

 

(b)           The right without resistance or interference by Debtor, to take possession of the Collateral; and/or dispose of any Collateral where located; and/or require Debtor to assemble and make available to the Secured Party at the expense of Debtor any Collateral at a place designated by the Secured Party which is reasonably convenient to both parties;

 

(c)           The right to remove any Collateral from where it is located for the purpose of effecting sale or other disposition thereof (and if any of the Collateral consists of motor vehicles the Secured Party may use Debtor’s license plates);

 

(d)           The right to sell, resell, lease, assign and deliver, grant options for or otherwise dispose of any Collateral in its then condition or following any commercially reasonable preparation or processing, at the public or private sale or proceedings or otherwise, by one or more

 

  

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contracts, in one or more parcels, at the same or different times, with or without having the Collateral at the place of sale or other disposition, for cash and/or credit, and upon any terms, at such place(s) and time(s) and to such person(s) as the Secured Party deems best, all without demand, notice or advertisement whatsoever except that where an applicable statute requires reasonable notice of sale or other disposition Debtor hereby agrees that the sending of three (3) days notice by ordinary mail, postage prepaid, to any address of Debtor set forth in this Security Agreement shall be deemed reasonable notice thereof.  If any Collateral is sold by the Secured Party upon credit or for future delivery, the Secured Party shall not be liable for the failure of the purchaser to pay for same and in such event the Secured Party may resell such Collateral. The Secured Party may buy any Collateral at any public sale and, if any Collateral is of a type customarily sold in a recognized market or is of the type which is subject to a standard price quotations, the Secured Party may buy such Collateral at such price at private sale and in each case may make payment therefore by any means.

 

6.  Application of Proceeds Received.  The Secured Party may apply the sale proceeds actually received from any sale or other disposition to the reasonable expenses of retaking, holding, preparing for sale, selling, leasing and the like, to reasonable attorneys fees and all travel and other expenses which may be incurred by Secured Party in attempting to collect the Obligations or enforce this Security Agreement or in the prosecution or defense of any action or proceeding related to the subject matter of this Security Agreement; and then to the Obligations in such order and as to principal, or interest or other charges as the Secured Party may desire; and Debtor shall remain liable and will pay the Secured Party, on demand, any deficiency remaining, together with interest thereon at the highest rate then payable on the Obligations and the balance of any expenses unpaid, with any surplus to be paid to Debtor, subject to any duty of the Secured Party, imposed by law, to the holder of any subordinate interest in the Collateral actually known to the Secured Party.

 

The Secured Party may appropriate, set off and apply to the payment of the Obligations, any Collateral in or coming into the possession of the Secured Party or its agents, without notice to Debtor and in such manner as Secured Party may in its discretion determine.

 

7.  Attorney-In-Fact.  To effectuate the terms and provisions hereof Debtor hereby designates and appoints the Secured Party and its designees or agents as attorney-in-fact of Debtor, irrevocably and with full power of substitution, with authority, after the occurrence of a Default, to: receive, open and dispose of all mail addressed to Debtor and notify the Post Office authorities to change the address for delivery of mail addressed to Debtor to such address as Secured Party may designate; endorse the name of Debtor on any notes, acceptances, checks, drafts, money orders, instruments or other evidences of Collateral or the proceeds thereof that may come into the Secured Party’s possession; sign the name of Debtor on any invoices, documents, drafts against and notices to account debtors or obligers of Debtor, assignments and requests for verification of accounts; execute proofs of claim and loss; execute endorsements, assignments of other instruments of conveyance or transfer; adjust and compromise any claims under insurance policies or otherwise; execute releases; and do all other acts and things necessary or advisable in the sole discretion of the Secured Party to carry out and enforce this Security Agreement and/or the Obligations. All acts done under the foregoing authorization are hereby ratified and approved and neither Secured Party nor any designee or agent thereof shall be liable for any acts of commission or omission, for any error of judgment or 

 

  

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for any mistake of fact or law. This power or attorney being coupled with an interest is irrevocable while any Obligation shall remain unpaid.

 

8.  Miscellaneous.  The Secured Party shall not be deemed, by its acceptance of this Security Agreement, to have assumed any responsibility, or obligation or duty with respect to, any of the Collateral or its use, or any matter or proceeding arising out of or relating thereto, including, without limitation, any obligation or duty to take action to collect, preserve or protect its or Debtor’s rights  in the Collateral.  Debtor hereby releases the Secured Party from any claims, causes of action and demands at any time arising out of or with respect to this Security Agreement, the Obligations, the Collateral or its use or disposition and Debtor hereby agrees to hold the Secured Party harmless from and with respect to any and such claims, causes of action and demands relating thereto.  The Secured Party’s prior recourse to any Collateral shall not constitute a condition of any demand, suit or proceeding for payment or collection of the Obligations.  No act, omission or delay by the Secured Party shall constitute a waiver of its rights and remedies hereunder or otherwise.  No single or partial waiver by the Secured Party of any Default or right or remedy which it may have shall operate as a waiver of any other Default, right or remedy or of the same Default, right or remedy on a future occasion. Debtor hereby waives presentment, notice of dishonor and protest of all instruments included in or evidencing the Obligations of the Collateral, and all other notices and demands whatsoever (except as expressly otherwise provided herein).  In the event of any litigation with respect to any matter connected with this Security Agreement, the Obligations or the Collateral, Debtor hereby waives the right to a trial by jury. Debtor hereby irrevocably consents to the jurisdiction of the Courts of the State of New York and of any Federal Court located in such State in connection with any action or proceeding arising out of or relating to the Obligations, this Security Agreement or the Collateral, or any document or instrument delivered with respect to any of the Obligations.  Debtor hereby waives personal service of any process in connection with any such action or proceeding and agrees that the service thereof may be made by certified or registered mail directed to Debtor at any address of Debtor set forth in this Security Agreement.  Debtor so served shall appear or answer to such process within thirty (30) days after the mailing thereof.  Should Debtor so served fail to appear or answer within said thirty (30) day period, Debtor shall be deemed in default and judgment may be entered by Secured Party against Debtor for the amount requested and such other relief as may be demanded in any process so served.  In the alternative, in its discretion, Secured Party may effect service upon Debtor in any other form or manner permitted by law.  All terms herein shall have the meanings as defined in the UCC, unless the context otherwise requires.  No provision hereof shall be modified, altered or limited except by a written instrument expressly referring to this Security Agreement and to such provision, and executed by the party to be charged.  This Security Agreement and all Obligations shall be binding upon the successors, or assigns of Debtor and shall, together with the rights and remedies of the Secured Party hereunder, inure to the benefit of the Secured Party and its successors, endorsees and assigns.  This Security Agreement and the Obligations shall be governed, enforced and controlled by and in accordance with the laws of the State of New York.  If any term of this Security Agreement shall be held to be invalid, illegal or unenforceable, the validity of all other terms hereof shall in no way be affected thereby.  The Secured Party is authorized to annex hereto the schedules and exhibits, if any, referred to herein.  Debtor acknowledges receipt of a copy of this Security Agreement.  If the provisions of this Security Agreement should conflict with the terms and provisions of any loan or line of credit 

 

  

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agreement entered into by the Debtor with the Secured Party in connection with the Obligations, the terms and provisions of the loan or line of credit agreement shall control any conflicting terms and provisions herein contained.

 

  

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IN WITNESS WHEREOF, the undersigned have executed this Security Agreement to be effective as of the 31st day of May, 2007.

 

	 	NATHANIEL ENERGY CORPORATION	 
	 	 	 	 
	
 

	
By: 

	 /s/ Brad E. Bailey	 
	 	 	Name: Brad E. Bailey	 
	 	 	Title: Chief Executive Officer	 
	 	 	 	 
	 	 	Richard C. Strain	 

 

  

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SCHEDULE “A”

 

TO SECURITY AGREEMENT DATED May 31, 2007

BETWEEN VISTA INTERNATIONAL TECHNOLOGIES, INC.

AND RICHARD  C. STRAIN

 

All right, title and interest of Debtor, whether now owned or hereinafter acquired, in and to all of Debtor’s personal property and assets of any kind or nature, wherever so situated (collectively, the “Collateral”), including but not limited to the following Collateral:

 

1.           All cash and cash equivalents, accounts, accounts receivable, agreements, rights, interests, inventory, goods, contract rights, chattel paper, documents, instruments, general intangibles, furniture, fixtures, equipment, machinery, apparatus, trade fixtures, consumer goods, Rolling Stock (defined below) and other assets owned by Debtor; and

 

2.           All automobiles, trucks, boats, and other rolling stock or moveable personal property (“Rolling Stock”), including Rolling Stock for which the title thereto is evidenced by a certificate of title issued by the United States or a state which permits or requires a lien thereon to be evidenced upon such title, in which Debtor now or at any time in the future may have an interest; and

 

3.           All funds or other property of Debtor from time to time in the possession of Secured Party, with respect to which Debtor agrees that Secured Party shall have the rights and remedies available under Article 9 of the Uniform Commercial Code of the State of New York or other applicable law relating to “cash collateral”;

 

together in each case, with all proceeds thereof and all substitutions, replacements and accessions thereto.

 

 

11ex_10-18.htm

Exhibit 10.18

 

 

	 	
MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

 

This Consulting and Services Agreement (this “Agreement”) is made and entered into this 11th day of June, 2009, by and between Mustang Consulting, LLC, a Texas limited liability company (“MUSTANG”), having its principal place of business at 5527 Sterling Brook, Houston, TX 77041 and Vista International Technologies, Inc., a Delaware corporation (“VVIT”), with an address at 4704 Harlan Street, Suite 685, Denver CO  80212, each individually a “Party” and together “the Parties”.

 

W I T N E S S E T H:

 

WHEREAS, VVIT desires to obtain the expert services of MUSTANG for the purpose of improving their corporate operations and advancing their patented thermal gasification technology, and

 

WHEREAS, MUSTANG is willing to share its expert knowledge of such business and technical activities (i.e. its “intellectual capital”) and agrees to provide such consulting services in accordance with the terms and conditions listed below;

 

NOW THEREFORE, for and in consideration of the compensation indicated below and in further consideration of the premises and the agreements herein contained, the sufficiency of which is hereby acknowledged and confessed, the Parties do hereby agree as follows:

 

	
1.

	
Confidentiality

 

Any material marked as “Confidential” and shared between VVIT and MUSTANG as part of the Transaction, shall be controlled by the receiving Party as it controls its own confidential materials.

 

	
2.

	
Services

 

During the Contract Period (as defined herein), MUSTANG shall act as a consultant to VVIT using its intellectual capital to provide VVIT guidance and advice with respect to business planning and strategies and advancement of VVIT’s patented thermal gasification technology, including without limitations, the following:

 

	
  

	
a.

	
Business & Financial advisory services:

 

	
  

	
i.

	
Evaluate & organize business plan to advance the company

 

	
  

	
ii.

	
Provide support to senior management

 

	
  

	
iii.

	
Business development advancement & support

 

	
  

	
iv.

	
Accounting  assistance & renegotiation of existing VVIT debt

 

	
  

	
v.

	
Identify and support in the raising of capital for the company

 

  

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MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

 

	 	

b.

	
Technical advisory services:

 

	
  

	
i.

	
Engineering Assessment of the VVIT gasification technology and the engineering tasks required for commercial deployment.   This Engineering Assessment starts with a detailed review of the current engineering drawings and available design details for the thermal gasification technology.  Then the specific engineering design tasks that are required to be completed before a unit can be built and operated in a safe, reliable, and economic manner are identified.  Finally a plan will be developed that assigns each task to in-house staff, consulting support, or third-party engineering contractors for completion.

 

	
  

	
ii.

	
Supervision of VVIT technical staff (i.e. Mark Wise, Senior CAD Designer)

 

	
  

	
●

	
Develop Instrumentation List

	
  

	

●

	
Complete engineering construction drawings

	
  

	

●

	
Calculate Energy Balance for given fuels

	
  

	

●

	
Develop conceptual plant configuration and layout

 

	
  

	
iii.

	
Supervision of contract engineering services

 

	
  

	

●

	
Develop instrumentation device specifications

	
  

	

●

	
PE review and stamp construction drawings

	
  

	

●

	
Develop Process Flow Diagrams (PFD’s)

	
  

	

●

	
Complete ASME certification for product

 

	
  

	
iv.

	
Supervision of documentation of modifications to the gasifier unit to prepare for commercial deployment

 

	
  

	
v.

	
Project management services for development projects

 

MUSTANG shall perform the following activities to advance and commercialize the patented technology for the EU market:

 

	
  

	

●

	
Develop Operations Control Program

	
  

	

●

	
Develop ladder-logic diagrams

	
  

	

●

	
Prepare feedback and signal processing calculations

	
  

	

●

	
Establish warning, alarm, and control function set-points

	
  

	

●

	
Complete EU certification for product

 

Note: Third party expenses associated with the completion of these items for the EU market will be paid for by MUSTANG (or an affiliate or sub-licensee of MUSTANG, including but not limited to Renewable Power Holdings Incorporated, Renewable Power Development, LLC and/or Renewable Power Development Europe, s.r.l.).

 

MUSTANG shall communicate directly with the VVIT Board of Directors (the “BOD”) in the provision of its services.  The BOD shall direct the VVIT management and staff to implement the actions recommended by MUSTANG as the BOD deems appropriate.  The BOD shall communicate regularly with MUSTANG to identify specific tasks and the MUSTANG shall communicate regularly with the BOD as to the progress on assigned tasks.

 

  

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MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

 

The Services shall be performed in a good and workmanlike manner and in accordance with generally accepted industry standards.  Any or all portions of the Services which were not performed in a good and workmanlike manner, or not in accordance with industry standards, shall be re-performed at MUSTANG’s cost and expense and at no cost to VVIT.

 

	
3.

	
MUSTANG Equal Opportunity Policies

 

MUSTANG provides equal opportunity to all persons consistent with employment requirements and individual qualifications.  This policy prohibits discrimination in all employment practices for reasons of race, color, religion, sex, national origin, age, physical or mental disability, status as a special disabled veteran or veteran of the Vietnam era, or citizenship of individuals legally authorized to work in the United States.  Harassment for any of the above reasons, including sexual harassment, is a discriminatory activity and is strictly prohibited.

 

MUSTANG agrees to comply with its policies set forth in this Section 3 in providing services hereunder.

 

	
4.

	
Work Product

 

The tangible property and tangible work products created by MUSTANG pursuant to this Agreement, and all rights therein, shall belong to VVIT or its providers of licensed software; however, MUSTANG shall have the right to maintain copies of its work papers created in association with the work performed pursuant to this Agreement.

 

Notwithstanding the foregoing, all systems, programs and specifications, and other materials and hardware owned by MUSTANG or in its possession (“MUSTANG Pre-Existing Technology”) prior to the execution of this Agreement and used by MUSTANG in conjunction with providing services to VVIT, and MUSTANG’s intellectual capital, shall continue to belong exclusively to MUSTANG whether or not they were specifically adapted by MUSTANG for use by VVIT.  Unless otherwise expressly agreed to in writing, MUSTANG hereby grants to VVIT a non-exclusive, royalty-free, non-assignable, non-sublicensable license to use the MUSTANG Pre-Existing Technology during the Contract Period.

 

	
5.

	
Independent Contractor

 

It is understood that MUSTANG is retained and has contracted with VVIT only for the purposes and to the extent set forth in this Agreement, and MUSTANG’s relation to VVIT and any of its affiliate or subsidiary companies shall, during the period of MUSTANG’s retainer and service hereunder, be that of an independent contractor.

 

MUSTANG, and its employees, shall not be considered under the provisions of this Agreement or otherwise as having a status as an employee of VVIT nor shall MUSTANG, nor any of its employees, be entitled hereafter to participate in any plans, arrangements, or distributions by VVIT relating to any pension, deferred compensation, bonus, hospitalization, insurance, or other benefits extended by VVIT to its employees since MUSTANG and its employees are performing the services hereunder as an independent contractor.  MUSTANG and its employees are responsible for payment of all taxes on income earned under this Agreement as none will be withheld by VVIT.

 

  

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MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

 

MUSTANG further acknowledges and agrees that MUSTANG is not authorized to assume or create any obligation, liability or responsibility, expressed or implied, on behalf of or in the name of VVIT or to bind VVIT in any manner whatsoever.

 

	
6.

	
Applicable Licenses

 

MUSTANG represents and warrants that MUSTANG has all necessary licenses, permits, and registrations reasonably required to provide the services.  If any additional permits, licenses and/or registrations are necessary for performance and completion of the services, MUSTANG shall notify VVIT of the specific items required.  If VVIT then directs that the requested services be completed while complying with any special requirements, MUSTANG shall acquire the specific items as necessary to provide the services.  VVIT shall reimburse MUSTANG in connection therewith, any and all applicable fees, assessments and taxes.

 

	
7.

	
Compliance with Laws and Regulations

 

In connection with the performance of the services contemplated by this Agreement,  MUSTANG agrees to comply with all laws, rules and regulations, Federal, State, County and Municipal, which are now applicable to its performance of the services for VVIT­.

 

	
8.

	
Subcontractors and Assignment

 

MUSTANG may assign this Agreement­ or subcontract the whole or any part of the services to  be per­formed by MUSTANG hereunder.  VVIT may not assign or subcontract this Agreement.

 

	
9.

	
Reports of Accidents

 

MUSTANG shall report to VVIT all accidents or occurrences resulting in injuries to  MUSTANG and its employees or third parties, or damage to property arising out of or during the course of the services performed for VVIT by MUSTANG.  Additionally, MUSTANG shall, as soon as practical, furnish VVIT with a copy of all reports made by MUSTANG or its insurer or reports to others of such accidents or occurrences.

 

	
10.

	
Compensation

 

For the services performed by MUSTANG, as requested by VVIT, VVIT shall pay MUSTANG at the rate of $140.00 for each hour worked for direct labor.  For the first two (2) months of this Agreement, One Hundred percent (100%) of the direct labor charges will be paid in the form of VVIT common stock if VVIT does not have adequate cash to pay for the direct labor charges.  Thereafter, all fees for direct labor costs are to be paid in cash, however, MUSTANG shall have the option to have either Fifty percent (50%) or One Hundred percent (100%) of the direct labor charges paid in the form of VVIT common stock, if VVIT does not have adequate cash to pay each monthly invoice.

 

  

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MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

 

For purposes of determining the share price of VVIT common stock for the first month services are performed for VVIT by MUSTANG, the share price shall be fixed at $0.10 per share.  For purposes of determining the share price of VVIT common stock after the first month services are performed for VVIT by MUSTANG, the average of the daily closing share price, as reported by the OTC Bulletin Board or exchange upon which VVIT’s common stock is listed or included, or if not so listed or included, then as reported by a mutually agreed reporting agency for over the counter trading, weighted for the number of shares traded each day, for the month the services were rendered to VVIT shall be used to calculate the number of shares due for that portion of the billed direct labor charges to be paid in the form of VVIT common stock for that month.

 

Additionally, VVIT hereby grants to MUSTANG, as additional compensation, a worldwide, irrevocable and perpetual non-exclusive license to use VVIT commercialized gasification technology, which shall be effective upon the delivery to VVIT by MUSTANG of a report detailing the Engineering Assessment identified under section 2.b.i. of this Agreement.  There shall be a fixed license fee at the rate of $50,000 per 16 MMBtu/Hr of thermal capacity (the nominal capacity required to generate 1 MW of electrical output), calculated at a proportional rate based on the design capacity of each gasification unit built directly by MUSTANG or by   any affiliate, co-venturer or subcontractor of MUSTANG for its own account or for the account of other end-users.  The license fee is payable upon commercial operation of each unit so built.  Such license rights are sublicensable to users of gasification units which are built by MUSTANG or its affiliates (including, but not limited to, Renewable Power Holdings Incorporated, Renewable Power Development, LLC and/or Renewable Power Development Europe, s.r.l.), co-venturers or subcontractors.

 

If VVIT ever offers to sell the rights to any of the thermal gasification technology, MUSTANG shall have a “right of first offer” to match any bona fide offer to purchase the technology, which shall be effective upon the delivery to VVIT by  MUSTANG of a report detailing the Engineering Assessment identified under section 2.b.i. of this Agreement.  VVIT shall provide MUSTANG with a minimum of thirty (30) days written notice to exercise this “right of first offer” before it may close on the sale of the rights to any of the thermal gasification technology to any third party.  For the purposes of the right of first offer, sale of the rights to the thermal gasification technology shall include, without limitation, the sale of any of the thermal gasification technology, the granting of any exclusive license for the thermal gasification technology, sale or transfer of a majority of the equity of VVIT or any subsidiary which owns  any of the thermal gasification technology, or merger or consolidation of VVIT or any subsidiary that owns any of the thermal gasification technology in a transaction where such entity is not the surviving entity or a change in control of such entity occurs or  such entity enters into bankruptcy.

 

VVIT shall also reimburse MUSTANG for all reasonable out-of-pocket expenses actually incurred while performing requested services.  The reimbursement for expenses shall always be paid in cash.

 

MUSTANG shall submit invoices monthly for services performed and for the expenses related thereto.  These invoices shall have attached the necessary detail to support the billing.  Invoices should reference this Agreement and be directed to the Notification address indicated for VVIT.  VVIT shall pay MUSTANG within ten (10) business days of VVIT’s receipt of such invoices.

 

  

Page 5 of 10

  

 

	

	
MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

 

	
11.

	
Audit

 

VVIT, or its duly authorized representatives, will have reasonable access at reasonable times to MUSTANG’s personnel, records, information, and other materials pertaining to work performed under this Agreement for the purpose of conducting an audit, at VVIT’s expense, once each calendar month, to verify MUSTANG’s compliance with this Agreement and the accuracy of  any charges submitted under this Agreement.  MUSTANG shall preserve all such materials for a period of two (2) years after completion and acceptance of the work.  This paragraph 11 shall be limited to materials associated with charges submitted to VVIT and services performed by MUSTANG under this Agreement.

 

	
12.

	
No Warranty

 

The Parties hereto understand and agree that all services are provided on an “as is”  basis, without warranty of any kind, including warranty of completeness or accuracy.  Neither Party shall be obligated to the other for indirect, incidental, speculative nor consequential damages or expenses for any reason associated with the quality of services provided under this Agreement.

 

	
13.

	
Notifications

 

Any notice required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given when (i) delivered in person, (ii) sent by certified mail, postage prepaid, (iii) delivered by a nationally recognized overnight delivery service or (iv) sent by telecopy,  provided that a confirmation copy is sent via a nationally recognized overnight delivery service on the same business day.  Any Party may change the person and address to which notices or other communications are to be sent by giving written notice of such change to the other Party in the manner provided herein for giving notice.

 

All notices to MUSTANG shall be sent to:

 

Mustang Consulting, LLC

5527 Sterling Brook

Houston, TX 77041

Attn: Paul Marley

 

All notices to VVIT shall be sent to:

 

Vista International Technologies, Inc.

4704 Harlan Street

Suite 685

Denver CO  80212

Attn: Chief Executive Officer

 

	
14.

	
Company’s Representatives

 

VVIT’s representatives who may authorize services to be performed hereunder or who may terminate this Agreement are any BOD member or other VVIT employee who is designated in writing by the BOD of VVIT.

 

  

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MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

 

	

15.

	

Indemnifications

 

MUSTANG agree to hold harmless, indemnify and defend VVIT, its directors, officers, employees and agents, from and against any and all claims or liability, including reasonable attorney’s fees, arising out of:

 

	
  

	
(A)

	
any claim for bodily injury or death;

	
  

	
(B)

	
any claim for damage to tangible property;

	
  

	
(C)

	
any claim of MUSTANG’s employees for wages or benefits;

 

which arise in connection with the performance of the services by MUSTANG hereunder, except with regard to (A) or (B) above to the extent attributable to the fault or negligence of VVIT, or  its employees or agents, either by act or omission.  This indemnity obligation shall survive termination of this Agreement.

 

VVIT agrees to hold harmless, indemnify and defend MUSTANG, its members, officers, employees and agents, from and against any and all claims or liability, including reasonable attorney’s fees, arising out of:

 

	
  

	
(X)

	
any claim for bodily injury or death; or

	
  

	
(Y)

	
any claim for damage to tangible property;

 

which arise in connection with activities performed by VVIT hereunder, except with regard to (X) or (Y) above to the extent attributable to the fault or negligence of MUSTANG or its employees or agents, either by act or omission.  This indemnity obligation shall survive termination of this Agreement.

 

	
16.

	
No Waiver

 

No failure or delay in exercising any right,  power, or privilege hereunder will operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege hereunder.

 

	
17.

	
Contract Period

 

This Agreement will continue in effect for one year from the date first written above unless extended in writing by the Parties (the “Contract Period”).  For the avoidance of doubt, any extension of the term of this Agreement shall be included in the definition of “Contract Period”.  Either party may terminate the Contract Period for any or no reason prior to expiration upon thirty (30) days prior written notice to the other party and the Contract Period shall, in such case end on the termination date.  VVIT will be obligated to pay for any services, and associated expenses, that were performed during the Contract Period.  For the avoidance of doubt, the license granted under Section 10 hereof shall continue in effect and shall be unaffected by any early termination of the Contract Period.

 

	
18.

	
Survival

 

The provisions of Sections 1, 4, 6, 10, 11, 12, 15, 16, 17, 18, 19, 20 and 24 shall survive termination of this Agreement.

 

  

Page 7 of 10

  

 

	

	
MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

 

	
19.

	
Waiver of Breach

 

No waiver by either Party of any condition or of the breach by the other of any term or covenant contained in this Agreement shall be effective unless in writing and signed by the aggrieved party.  A waiver by a party hereto in any one or more instances shall not be deemed or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition, or of the breach of any other term or covenant set forth in this Agreement.  Moreover, the failure of either Party to exercise any right hereunder shall not bar the later exercise thereof.

 

	
20.

	
Expenses

 

Each Party agrees to reimburse the other party for any reasonable expenses (including attorneys’ fees) incurred by it in enforcing the provisions hereof if the other Party prevails in that enforcement.

 

	
21.

	
Representation By Counsel; Interpretation

 

Each party acknowledges that it has been represented by counsel, or has been afforded the opportunity to be represented by counsel in connection with this Agreement and the transactions contemplated hereby.  Accordingly, any rule or law or any legal decision that would require the interpretation of any claimed ambiguities in this Agreement against the party that drafted it has no application and is expressly waived by the parties.  The provisions of this Agreement shall be interpreted in a reasonable manner to give effect to the intent of the parties hereto.

 

	
22.

	
Invalidity or Unenforceability

 

If any term or provision of this Agreement is held to be invalid or unenforceable, for any reason, such invalidity or unenforceability shall not affect any other term or provision hereof and this Agreement shall continue in full force and effect as if such invalid or unenforceable term or provision (to the extent of the invalidity or unenforceability) had not been contained herein.

 

	
23.

	
Counterparts; Signatures

 

This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same instrument.  Signatures transmitted by facsimile or electronic mail shall be deemed to be original signatures hereon.

 

	
24.

	
Miscellaneous

 

This Agreement inures to the benefit of the Parties hereto and their permitted successors and assigns and is binding on each other and each other’s permitted successors and assigns.

 

This Agreement constitutes the entire agreement between MUSTANG and VVIT with respect to the subject matter hereof.  Further, it shall be amended only in writing agreed to by both Parties.

 

The headings of the Sections of this Agreement are inserted for convenience only and do not constitute a part hereof or affect in any way the meaning or interpretation of this Agreement.

 

  

Page 8 of 10

  

 

	

	
MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

 

Any legal action, suit, or proceeding with respect to this Agreement shall be brought in a federal or state court within Jefferson County, Colorado.  Each Party hereby consents to personal jurisdiction in any legal action, suit, or proceeding brought in any court, federal or state, within Jefferson County, Colorado having subject matter jurisdiction arising under this Agreement, and, with respect to such claim, each Party irrevocably waives, to the fullest extent permitted by law, any claim or any objection that such Party may now or hereafter have, that venue is not proper with respect to any such legal action, suit, or proceeding brought in such a court in Jefferson County, Colorado, including any claim that such legal action, suit, or proceeding brought in such court has been brought in an inconvenient forum and any claim that the Party is not subject to personal jurisdiction or service of process in such Jefferson County, Colorado forum.

 

This agreement will be governed by and construed in accordance with the laws of the state of Colorado applicable to agreements made and to be performed within such state without regard to the conflict of laws principles thereof.

 

— Signature Page Follows —

 

  

Page 9 of 10

  

 

	

	
MUSTANG CONSULTING, LLC

CONSULTING AND SERVICES AGREEMENT

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

 

	
Mustang Consulting, LLC

 

	 
	 	 
	Paul C. Marley II, P.E.	 
	President	 
	 	 
	Vista International Technologies, Inc.	 
	 	 
	
By: 

	 	 
	Name:	BARRY KEMBLE	 
	Title:	CEO	 
	 	 	 

 

  

Page 10 of 10

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