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GENERAL CONVEYANCE OF ASSETS

THIS INDENTURE made as of the 19th day of March, 2004

BETWEEN:

VLADIMIR PETROVIC, 5928 Rumble Street, Burnaby, British Columbia, V5J 2C5

(the "Vendor")

AND:

ACCELRATE POWER SYSTEMS INC., Suite 1370, 1140 West Pender Street, Vancouver, British Columbia   V6E 4G1

(the "Purchaser")

WITNESSES THAT WHEREAS:

A.

Pursuant to an agreement (the "Purchase Agreement") made as of February 5, 2004 between the Vendor and the Purchaser, the Vendor agreed, inter alia, to sell the Assets to the Purchaser for 3,000,000 common shares in the capital of the Purchaser;

B.

Pursuant to the Purchase Agreement, the Vendor agreed to execute and deliver this Indenture for the purpose of conveying the Assets to the Purchaser;

THEREFORE, in consideration of the premises and the sum of $10.00 and other good and valuable consideration now paid by the Purchaser to the Vendor, the receipt of which is hereby acknowledged by the Vendor, the Vendor hereby covenants and agrees with the Purchaser as follows:

1.01

In this Indenture, unless a contrary intention appears, the words and phrases set out in Schedule 1.01 shall have the meanings assigned to them in Schedule 1.01.

1.02

The Vendor hereby grants, bargains, sells, assigns, transfers, conveys, and sets over unto the Purchaser all of the Assets, wherever situate, and all legal and beneficial right, title and interest therein and thereto, and all other property and things of every kind and nature, tangible and intangible, legal and equitable which the Vendor may be possessed of or entitled to in connection with the Assets.

1.03

The Vendor covenants, agrees, represents and warrants to and with the Purchaser that:

(a)

the Vendor is now rightfully and absolutely possessed of and entitled to the Assets, and has the right to convey same to the Purchaser in the manner herein provided;

(b)

the Assets are free and clear of all liens, charges, encumbrances, claims, and demands of every nature and kind whatsoever;

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(c)

from and after the time and execution and delivery hereof the Purchaser will peaceably and quietly have, hold, possess and enjoy the Assets to and for the Purchaser's own use and benefit without any manner of hindrance, interruption, molestation, claim or demand whatsoever of, from or by the Vendor or any other person claiming by, through or under the Vendor whomsoever; and

(d)

the Vendor will from time to time and at all times hereafter, upon the reasonable request of the Purchaser, but at the expense of the Purchaser, make, do and execute, or cause to or procure to be made, done and executed, all such further acts, deeds, and assurances for the more effectual conveyance and assurance of the Assets unto the Purchaser in accordance with the intent and meaning of this Indenture, as may be reasonably required by the Purchaser.

1.04

The Vendor hereby constitutes and appoints the person from time to time holding the office of President of the Purchaser as the true and lawful attorney of the Vendor, with full power of substitution, to do all acts and deeds, to execute all documents and instruments, and to give all assurances, for and in the name of or otherwise on behalf of the Vendor, as may be required to give effect to the conveyance of the Assets to the Purchaser in the manner herein provided, in accordance with the intent and meaning of this Indenture. 

IN WITNESS WHEREOF the Vendor and Purchaser have executed these presents as of the day and year first above written.

“Vladimir Petrovic”

VLADMIR PETROVIC

ACCELRATE POWER SYSTEMS INC.

Per:

“Reimar Koch”

Authorized Signatory

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Schedule 1.01

Definitions

"Assets" means, collectively, the Invention, the Rights, the Technology, the Patents, the Petrovic Marks, the Documentation and any Petrovic Contracts, and all of the Vendor's right, title and interest in, to and under the License Agreement and in respect of the License, including royalties payable by the Purchaser thereunder;

"Documentation" means all printed and electronic material relating in any way to the Assets, including without limitation all copyright materials and the full benefit thereof;

"Invention" means the invention which is the subject of the United States provisional patent application entitled "Sequential Pulse Method for Fast Battery Charging", filed July 19, 1999 on behalf of the Vendor as inventor and the Purchaser as applicant, and all improvements thereon, all additions thereto and all other inventions derived from or based in whole or in part thereon;

"License" means the sole and exclusive right and license granted in the License Agreement to, inter alia, use the Petrovic Marks and the Patents and to use, exploit and sub-license the Technology and the Invention for the purpose of manufacturing (or causing to be manufactured by a third party selected by the Purchaser), distributing and selling Products throughout the world, including without limitation the right and license to grant sub-licenses of all or any portion of the right and license granted to the Purchaser under the License Agreement;

"License Agreement" means that certain License and Distribution Agreement made as of July 19, 1999 between the Vendor and the Purchaser; 

''Patents" means any and all patents, patent applications and patents pending relating in any way to the Invention and/or the Technology, including without limitation the Vendor's United States provisional patent application entitled "Sequential Pulse Method for Fast Battery Charging", filed July 19, 1999 on behalf of the Vendor as inventor and the Purchaser as applicant, and all patents derived therefrom and from any and all other patent applications filed by the Vendor in respect of the Invention or the Technology, and all proprietary rights associated with and arising from them and any amendments or improvements thereto;

"Petrovic Contracts" means all right, title and interest in, to and under all contracts, engagements and commitments which the Vendor is entitled to or possessed of in connection with the Assets, whether oral or written, including without limitation all licensing and revenue sharing agreements;

"Petrovic Marks" means all registered and unregistered trademarks, service marks, logos, insignias, seals, designs and other symbols/devices created or developed by or on behalf of the Vendor in connection with the Invention, the Technology or any Product, and all right, title and interest in and to all trade or brand names, copyrights, designs and other industrial or intellectual property used in connection therewith;

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"Products" means any and all products which may be manufactured, produced or otherwise derived, or are capable of being manufactured, produced or otherwise derived, using the Invention and/or all or some of the Technology, now or in the future;

"Rights" means the rights of the Vendor to all processes, trade secrets, know how, show how, patent and trade-mark applications and other proprietary information relating to the Invention;

"Technology" means any and all current and future intellectual property, trade secrets, proprietary information, plans, blueprints, technical data and materials, knowledge, know-how and techniques relating to the Invention and/or Patents, or otherwise relating to any process of battery charging or re-charging.Memorandum of Understanding

Memorandum of Understanding

This Memorandum of Understanding (MOU) is to define broadly the areas of interest between Key Capital Group Inc. of Vancouver, B.C. Canada ("Key") and Ferro Magnetics Corporation (FM) of St, Louis, Missouri (collectively, the "Parties") and the basic principles of a "Strategic Alliance" between them. The purpose of a Strategic Alliance between Key and FM is to construct a relationship that utilizes both corporations' strengths and applies them toward specific target markets in Canada and the United States. In addition, it is Key's objectives to reduce the initial risks for FM in its use of the AccelrateTM technology by forming two separate and distinct agreements, to be executed either jointly or separately. The first will be a Standard Supply Agreement from FM to Key and the second, a Standard License Agreement from Key to FM (the "Agreements").

1. 

A Standard Supply Agreement will be formed with a right of first refusal for all of Key's private label chargers. This Agreement will supply Key with chargers incorporating its AccelrateTM technology to Key's private label chargers.

2. 

A License Agreement will permit FM to use the Accelrate technology in all or any of FM's chargers to its own customers which will be protected as their exclusive customers. Key will not deal with any of FM's customers directly or indirectly, unless requested by FM.

This document will form the basis to the above-mentioned Agreements.

If AccelrateTM does not perform according to stated claims or the market applications are not competitive, then the MOU can be terminated by FM on December 31st, 2002 without any further obligations of the parties.

The basic principles of the Agreements are outlined below. GENERAL BACKGROUND

1.

Key Capital Group Inc. (Key) is a Canadian public corporation listed on the Canadian Venture Exchange. Key Capital has developed a "Charger Protocol" designed to be integrated into an existing transformer type charger or into a new "soft switching power conversion charger" allowing each of these charger types to be used as a "Fast Charger". The conversion of these standard charger types to a "Fast Charger" is accomplished without the negatives associated with "Fast Charging" protocols, This proprietary technology is called AccelrateTM.

2.

FM is a privately owned U.S. corporation engaged in the manufacturing of private brand industrial chargers.

3.

The purpose of a Strategic Alliance between Key and FM is to construct a relationship that utilizes both corporations' strengths and applies them toward specific target markets in Canada and the United States.

SUPPLY AGREEMENT

1.

Key will purchase a 20kW charger from FM, with Key's AccelrateTM technology implemented and with Key's corporate logos to be clearly identified. Once both parties are satisfied as to the function of the charger, it is to be shipped to Canada Post. Upon 

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completion of the test for Canada Post at its Regional Office in Calgary, Alberta, Key intends to prepare and a present proposal to the Purchasing department of Canada Post for the implementation of a "National Fast Charger" program, Once this program is authorized, Key intends to use its unique connections to various Canadian Government departments; for e.g. Department of Defense to initiate contacts for additional applications.

2.

Key will purchase a 45kW charger from FM, integrated with Key's AecelrateTM technology implemented and with Key's corporate logos to be clearly identified (approximate size and to be confirmed prior to execution of supply agreement) and delivered to Mitsui in Portland, Oregon.

3.

Key has a "Strategic Relationship" with Mitsui Corporation, and from time to time Key may notify FM of a potential customer to be categorized as a "Corporate Account", The designation of a "Corporate Account" signifies that this customer is exclusive to Mitsui U.S or Mitsui Canada as long as this company is not already in relations with FM. The point of contact for this customer will be Mitsui unless all parties are notified of any changes in writing. This applies bilaterally to FM.

4.

Under the Supply Agreement, FM shall not be liable for any license fees nor royalty payments for the incorporation of Key's technology in Key's private label chargers manufactured by it for Key's customers,

5.

Key will provide FM the first opportunity to quote and deliver on any and all enquires that Key receives for chargers if FM is competitive in terms of the industry (marketconform, Marktgerecht) regarding price, delivery and quality,

6.

The term of the Supply Agreement is 5 years with an option of FM for another 5 years and after this time will be automatically renewed on the anniversary unless either party objects. Specific remedies, if applicable, will be covered by the final "Supply Agreement", to satisfy the regulations of the Canadian Venture Exchange and regulatory authorities, a Press Release must be made at the time of signing of this MOU.

We the undersigned agree to the above,

On Behalf of Ferro Magnetics Corporation

Mr. Mike Franklin President and CEO

Date: 4-18-02­

On behalf of Key Capital Group Inc.

Mr. David McLeod President

Date: 4-18-02

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