ASSET TRANSFER AND ACQUISITION AGREEMENT
Exhibit
10.4
This
ASSET TRANSFER AND ACQUISITION AGREEMENT (this “Agreement”) dated as of the
1st
day of
March, 2006 (“Execution Date”) is made and entered into by and between
ARK
ENERGY, INC.,
a
Nevada corporation
(“Transferor”) and BLUEFIRE
ETHANOL, INC.,
a
Nevada Corporation (“Transferee”),
(Transferee and Transferor being sometimes hereinafter referred to individually
as a “Party” and collectively as the “Parties”). Capitalized terms not otherwise
defined herein have the meaning set forth in Article
I.
WHEREAS,
Transferee has an exclusive license from ARKENOL, INC. to develop, own and
operate ethanol plants using the Arkenol Technology for the North American
Market, and to sublicense the Technology to third parties to develop, own and
operate ethanol plants using the Arkenol Technology for the North American
Market;
WHEREAS,
Transferor owns certain rights, assets, Work-Product, intellectual property
and
other know-how on project opportunities that may be used for the deployment
of
the Arkenol Technology for the North American Market (all of the foregoing
being
hereafter referred to as the “Interests”) as described in Appendix I; and
WHEREAS,
Transferee may use the Interests in its and its sublicensees’ deployment of the
Arkenol Technology in the North American Market; and
WHEREAS,
Transferor desires to transfer, and Transferee desires to receive all rights,
title and interest held by Transferor in the Interests to Transferee, on the
terms and subject to the conditions set forth in this Agreement.
NOW,
THEREFORE, in consideration of the mutual covenants and agreements set forth
in
this Agreement, and for other good and valuable consideration, the receipt
and
sufficiency of which are hereby acknowledged, the Parties agree as
follows:
ARTICLE
I.
DEFINITIONS
Section
1. Definitions.
(a) Defined
Terms. As used in this Agreement, the following defined terms have the meanings
indicated below:
“Actions
or Proceedings”
means
any action, suit, proceeding, arbitration or Government or Regulatory Authority
investigation.
“Affiliate”
means
any Person that directly, or indirectly through one of more intermediaries,
controls or is controlled by or is under common control with the Person
specified. For purposes of this definition, control of a Person means the power,
direct or indirect, to direct or cause the direction of the management and
policies of such Person whether by Contract or otherwise and, in any event
and
without limitation of the previous sentence, any Person owning ten percent
(l0%)
or more of the voting securities of another Person shall be deemed to control
that Person.
1
“Agreement”
means
this Asset Transfer and Acquisition Agreement and the Appendices and Exhibits
herewith, as the same shall be amended from time to time.
“Arkenol
Technology”
means
Arkenol’s patented technology for the production of ethanol from cellulosic
materials.
“Arkenol
License”
means
the exclusive license that Transferee has received from Arkenol,
Inc.
“Assets
and Properties”
of
any
Person means all assets and properties of every kind, nature, character and
description (whether real, personal or mixed, whether tangible or intangible,
and wherever situated), including the goodwill related thereto, operated, owned
or leased by such Person.
“Assignment
of Interests”
means
the Assignment of Interests substantially in the form of Exhibit A.
“Business
Day”
means
a
day other than Saturday, Sunday or any day on which banks located in the State
of California and Nevada are authorized or obligated to close.
“Code”
means
the Internal Revenue Code of 1986, as amended, and the rules and regulations
promulgated thereunder.
“Environmental
Law”
means
any Law or Order relating to the regulation or protection of human health,
safety or the environment or to emissions, discharges, releases or threatened
releases of pollutants, contaminants, chemicals or industrial, toxic or
hazardous substances or wastes into the environment (including, without
limitation, ambient air, soil, surface water, ground water, wetlands, land
or
subsurface strata), or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, chemicals or industrial, toxic or hazardous substances
or wastes.
“Execution
Date”
means
the date first written in the introductory paragraph of this
Agreement.
“Financial
Closing”
shall
mean the long term non-recourse financing of the Transferee’s Project(s).
“GAAP”
means
generally accepted accounting principles, consistently applied throughout the
specified period and in the immediately prior comparable period.
2
“Governmental
Approval”
means
any authorization, approval, consent, license, exception, variance, order,
franchise, lease, ruling, permit, tariff, certification, exception, filing,
notice to, declarations of, or registration by or with any Governmental or
Regulatory Authority.
“Governmental
or Regulatory Authority”
means
any court, tribunal, arbitrator, authority, agency, commission, official or
other instrumentality of the United States or any state, county, city or other
political subdivision.
“Interests”
has
the
meaning ascribed to it in the forepart of this Agreement. “Interests” includes
the Work Product and any and all other assets, interests or property owned
or
held by Transferor described in Appendix I hereto.
“Knowledge
of Transferor”
means
the actual knowledge of the officers and employees of Transferor.
“Laws”
means
all laws, statutes, treaties, rules, codes, ordinances, regulations, permits,
official guidelines, certificates, orders, interpretations, licenses, leases
and
permits of any Governmental or Regulatory Authority, Governmental Approvals,
Environmental Laws, and judgments, decrees, injunctions, writs, orders or like
action of any court, arbitrator or other judicial or quasi-judicial tribunal
of
competent jurisdiction and all requirements of law.
“Liens”
means
any mortgage, pledge, assessment, security interest, lease, lien, adverse claim,
levy, charge or other encumbrance of any kind, or any conditional sale contract,
title retention contract or other contract to give any of the
foregoing.
“North
American Market”
shall
mean potential ethanol markets in the United States and Canada.
“Order”
means
any writ, judgment, decree, injunction or similar order of any Governmental
or
Regulatory Authority (in each such case whether preliminary or
final).
“Party”
or
“Parties”
shall
have the meaning set forth in the introductory paragraph to this
Agreement.
“Person”
means
any natural person, corporation, limited liability company, general partnership,
limited partnership, proprietorship, other business organizations, trust, union,
association or Governmental or Regulatory Authority.
“Performance
Bonus”
has
the
meaning ascribed to it in Article II, Section 2.
“Start
of Construction”
means
either the first placement of permanent construction of a building on site,
such
as the pouring of a slab or footing, the installation of piles, the construction
of columns, or any work beyond the stage of excavation; or the placement of
a
manufactured (mobile) home on a foundation.
“Transferee”
has
the
meaning ascribed to it in the forepart of this Agreement, and includes any
successors and assigns.
3
“Transferee’s
Project(s)”
shall
mean project(s) owned or controlled by the Transferee or by its sublicensees
utilizing the Arkenol Technology in the North American Market.
“Transferor”
has
the
meaning ascribed to it in the forepart of this Agreement and includes its
successors and assigns.
“Termination
Date”
shall
mean the date that is three (3) years after the Execution Date unless otherwise
amended by both parties in writing if significant progress has not been made
by
Transferee to develop, design, and finance its first project
“Work
Product”
shall
mean all rights appurtenant to the development of projects related to the
Arkenol Technology, data, all reports of consultants, all know-how and
information based or obtained in connection with the development of projects
related to the Arkenol Technology and all of the other rights (including, but
not limited to, development rights and other work products) comprising or
relative to the Arkenol Technology.
(b) Construction
of Certain Terms and Phrases.
Unless
context of this Agreement otherwise requires, (i) words of any gender include
each other gender, (ii) words using the singular of plural number also include
the plural or singular number, respectively; (iii) the terms “hereof,”
“herein,”
“hereby”
and
derivative or similar words refer to this entire Agreement; and (iv) the terms
“Article”
or
“Section”
refer
to the specified Article or Section of this Agreement. Whenever this Agreement
refers to a number of days, such number shall refer to calendar days unless
Business Days are specified. All accounting terms used herein and not expressly
defined herein shall have the meanings given to them under GAAP. Any
representation or warranty contained herein as to the enforceability of a
Contract shall be subject to the effect of any bankruptcy, insolvency,
reorganization, moratorium or other similar law affecting the enforcement of
creditors’ rights generally and to general equitable principles (regardless of
whether such enforceability is considered in a proceeding in equity or at
law).
ARTICLE
II.
TRANSFER
OF INTERESTS AND EXECUTION
Section
1. Transfer
and Receipt.
Transferor agrees to transfer to Transferee, and Transferee agrees to receive
from Transferor at the Execution Date, all of the rights, title and interests
of
Transferor in and to the Interests on the terms and subject to the conditions
set forth in this Agreement.
Section
2. Performance
Bonus.
In
consideration of the receipt and transfer described above and in the event
that
the Interests are used by Transferee in Transferee’s Project(s), Transferee
shall pay to Transferor an aggregate sum (the “Performance Bonus”) of up to a
maximum of SIXTEEN MILLION DOLLARS ($16,000,000). The payment of the Performance
Bonus is based on one hundred percent (100%) of the “at-cost” transfer basis of
the Interests at the time of that specific Transferee’s Project’s implementation
(as described on Table 1) as demonstrated by Start of Construction or Financial
Closing, whichever is earlier, and subject to the limitations in Section 3
of
this Article II.
4
Section
3. Payment
of Performance Bonus.
(a) The
Performance Bonus shall be due and payable as follows:
(i) The
Performance Bonus shall be paid in whole or in increments, based upon the value
of the use of the Interests, or a portion thereof, by Transferee in Transferee’s
Project(s). Such payment(s) shall be paid no later than thirty (30) days after
the Financial Closing or Start of Construction of Transferee’s Project(s)
utilizing the Interests, or a portion thereof, and receipt of an Invoice from
Transferor of the amount due. All payments to Transferor under this Agreement
will be solely by bank wire transfer in U.S. dollars.
Section
4. Conversion
Requirements.
The
Performance Bonus will be converted to preferred shares in the event BlueFire
becomes or is reorganized into a publicly traded company. Such preferred shares
issued will have a right of conversion to common stock at a ratio that will
be
limited to a maximum face value of sixteen million dollars ($ 16,000,000) as
determined by the price of the common stock at the time of conversion to common
shares which shall occur five years from the date of first trading of
shares.
ARTICLE
III.
REPRESENTATIONS
AND WARRANTIES OF TRANSFEROR
Except
as
otherwise provided herein, Transferor hereby represents and warrants to
Transferee as follows:
Section
1. Existence.
Transferor is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Nevada. Transferor has full corporate
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder and to consummate the sale of the Interests contemplated
hereby.
Section
2. Authority.
The
execution and delivery by Transferor of this Agreement, and the performance
by
Transferor of its obligations hereunder, have been duly and validly authorized
by its board of directors, no other corporate action on the part of Transferor,
its stockholders or any other person being necessary. This Agreement has been
duly and validly executed and delivered by Transferor and constitutes a legal,
valid and binding obligation of Transferor enforceable against Transferor in
accordance with its terms.
Section
3. Title
to Properties.
Transferor has good, valid and marketable title to the Interests, subject to
no
encumbrance, Lien, charge or other restriction of any kind or
character.
Section
4. Interests.
At the
Execution Date, the delivery of an Assignment of Interests provided in Section
4
of Article II will transfer to Transferee good and valid title to the Interests,
free and clear of all Liens, other than Liens created or suffered to exist
by
Transferee.
5
Section
5. Legal
Proceedings.
There
are no Actions or Proceedings pending or, to the Knowledge of Transferor,
threatened against, relating to or affecting Transferor or any of its Assets
and
Properties which could reasonably be expected to result in the issuance of
an
Order restraining, enjoining or otherwise prohibiting or making illegal the
consummation of the sale of the Interests contemplated by this
Agreement.
Section
6. Consents;
No Violation of Agreements.
No
consent of any person is necessary for the consummation by Transferor of the
transactions set forth herein, including, without limitation, consents from
governmental agencies, whether federal, state or local, and neither the
execution and delivery of this Agreement by Transferor nor the consummation
or
performance by Transferor of any of the transactions set forth herein, will
directly or indirectly (with or without notice or lapse of time) contravene,
conflict with, or result in a violation or breach of any provision of, or give
any person the right to declare a default or exercise any remedy under, or
to
accelerate the maturity or performance of, or to cancel, terminate, or modify,
any of the Interests.
Section
7. Taxes.
(a) Transferor
is not a “foreign person” within the meaning of Section 1445(b)(2) of the
Code;
(b) There
are
no liens for Taxes upon any of the Interests;
(c) None
of
the assets of Transferor is “tax-exempt use property” within the meaning of
Section 168(h) of the Code or tax-exempt bond financed property within the
meaning of Section 168(g)(5) of the Code and none of the assets of Transferor
is
subject to any lease made pursuant to Section 168(f)(8) of the Code (as in
effect from time to time prior to the date hereof); and
Section
8. Bankruptcy.
Transferor has not filed any voluntary petition in bankruptcy or been
adjudicated as bankrupt or insolvent, filed any petition or answer seeking
any
reorganization, liquidation, dissolution or similar relief under any federal
or
state bankruptcy act, insolvency, or other debtor relief law, nor sought or
consented to or acquiesced in the appointment of any trustee, receiver,
conservator or liquidator of all or any substantial part of its
properties.
Section
9. Brokers.
All
negotiations relative to this Agreement and the transactions contemplated hereby
have been carried out by Transferor directly with Transferee without the
intervention of any Person on behalf of Transferor in such manner as to give
rise to any valid claim by any Person against Transferee for a finder’s fee,
brokerage commission or similar payment.
Section
10. Disclosure.
Transferor has made available to Transferee copies of all books and records
in
its possession relating to the Interests, including, but not limited to, all
governmental communications, reviews, audits, investigations or inspections,
whether pending, completed or, to Transferor’s knowledge, threatened, relating
to the Projects or the Interests, which contain any material data or information
with respect to the ownership or development of the Projects. The
representations and warranties of Transferor, when taken as a whole, do not
contain any untrue statement of a material fact nor do they omit to state a
material fact which is or should have been known to Transferor or its Affiliates
to be necessary in order to make the representations and warranties made, in
light of the circumstances under which they were made, not
misleading.
6
ARTICLE
IV.
REPRESENTATIONS
AND WARRANTIES OF TRANSFEREE
Transferee
hereby represents and warrants to Transferor as follows:
Section
1. Corporate
Existence.
Transferee is a to be formed corporation that would be duly organized, validly
existing and in good standing under the Laws of the State of Nevada. Transferee
has full corporate power and authority to execute and deliver this Agreement,
to
perform its obligations hereunder and to consummate the receipt of the Interests
contemplated hereby. If the corporation is not formed within one (1) year of
the
Execution Date, then this Agreement is voided.
Section
2. Authority.
The
execution and delivery by Transferee of this Agreement, and the performance
by
Transferee of its obligations hereunder, have been duly and validly authorized
by the President of Transferee, no other action on the part of Transferee being
necessary. This Agreement has been duly and validly executed and delivered
by
Transferee and constitutes a legal, valid and binding obligation of Transferee
enforceable against Transferee in accordance with its terms.
Section
3. Legal
Proceedings.
There
are no Actions or Proceedings pending or, to the knowledge of Transferee,
threatened against, relating to or affecting Transferee or any of its Assets
and
Properties which could reasonably be expected to result in the issuance of
an
Order restraining, enjoining or otherwise prohibiting or making illegal the
consummation of the receive of the Interests contemplated by this
Agreement.
Section
4. Brokers.
All
negotiations relative to this Agreement and the transactions contemplated hereby
have been carried out by Transferee directly with Transferor without the
intervention of any Person on behalf of Transferee in such manner as to give
rise to any valid claim by any Person against Transferor or any Subsidiary
for a
finder’s fee, brokerage commission or similar payment.
ARTICLE
V.
COVENANTS
OF TRANSFEROR
Transferor
covenants and agrees with Transferee that, at all times from and after the
date
hereof until the Termination Date, Transferor will comply with all covenants
and
provisions of this Article
V,
except
to the extent Transferee may otherwise consent in writing.
7
Section
1. Fulfillment
of Conditions.
Transferor will proceed diligently and in good faith and will take all
commercially reasonable steps necessary or desirable to satisfy each condition
to the obligations of Transferee contained in this Agreement and will not take
or fail to take any action that could reasonably be expected to result in the
nonfulfillment of any such condition.
Section
2. Duty
to Notify.
Transferor shall promptly notify Transferee of any actions or events that might
have a material adverse effect or which may result in a breach of covenants
in
this Article
V,
may
result in a breach of the representations and warranties in Article III, or
may
otherwise impede the use of the Interests by Transferee.
Section
3. Duty
to Cooperate.
Transferor shall use its best reasonable efforts to cooperate with Transferee
to
facilitate the use of the Interests by Transferee.
Section
4. Non-Competition.
Transferor shall not engage in any activity that is in any way competitive
with
Transferee’s interest in the use of the Interests, and shall not assist any
other person or organization in competing with or in preparing to compete with
Transferee’s interest in the Interests.
ARTICLE
VI.
COVENANTS
OF TRANSFEREE
Transferee
covenants and agrees with Transferor that, at all times from and after the
date
hereof until the Termination Date, Transferee will comply with all covenants
and
provisions of this Article
VI,
except
to the extent Transferor may otherwise consent in writing.
Section
1. Fulfillment
of Conditions.
Transferee will take all commercially reasonable steps necessary or desirable
to
satisfy each condition to the obligations of Transferor contained in this
Agreement and will not take or fail to take any action that could reasonably
be
expected to result in the nonfulfillment of any such condition.
ARTICLE
VII.
CONDITIONS
TO OBLIGATIONS OF TRANSFEREE
The
obligations of Transferee hereunder to receive the Interests are subject to
the
fulfillment, at or before the Execution Date, of each of the following
conditions (all or any of which may be waived in whole or in part by Transferee
in its sole discretion).
Section
1. Performance.
Transferor shall have performed and complied with, in all material respects,
the
agreements, covenants and obligations required by this Agreement to be so
performed or complied with by Transferor at or before the Execution
Date.
8
Section
2. Accuracy
of Representations and Warranties.
The
representations and warranties of the Transferors herein contained shall be
true
at the Execution Date in all material respects.
Section
3. Assignment
of Interests.
Transferor shall have delivered the Assignment of Interests, substantially
in
the form of Exhibit
A.
ARTICLE
VIII.
CONDITIONS
TO OBLIGATIONS OF TRANSFEROR
The
obligations of Transferor hereunder to transfer the Interests are subjected
to
the fulfillment, at or before the Execution Date, of each of the following
conditions (all or any of which may be waived in whole or in part by Transferor
in its sole discretion).
Section
1. Performance.
Transferee shall have performed and complied with, in all material respects,
the
agreements, covenants and obligations required by this Agreement to be so
performed or complied with by the Transferee at or before the Execution
Date.
ARTICLE
IX.
TERMINATION
Section
1. Termination.
This
Agreement may be terminated by Transferee, and the transactions contemplated
hereby may be abandoned, at any time before the Termination Date, at the sole
discretion of Transferee with or without cause, by giving written notice to
Transferor. Upon termination, Transferee shall relinquish all rights to the
Interests.
Section
2. Effect
of Termination.
If this
Agreement is validly terminated pursuant to Section 1 of this Article IX, this
Agreement will forthwith become null and void, and there shall be no liability
or obligation on the part of Transferor or Transferee (or any of their
respective officers, directors, employees, agents or other representatives
or
Affiliates), subject to the following exceptions:
(a) Article
X
and Sections 3, 4, 5, 14, 15 and 16 of Article XI shall continue to apply
following any such termination; and
ARTICLE
X.
INDEMNIFICATION
Section
1. Indemnification
of Transferee by Transferor.
Transferor hereby agrees to indemnify and hold harmless Transferee, its
Affiliates and their respective shareholders, managers, officers, directors,
members, employees, partners, agents, and their respective heirs, personal
representatives, successors and assigns (the “Transferee Indemnified Parties”)
from and against any and all claims, demands, actions, proceedings,
investigations and rights of action asserted by any third party against any
of
the Transferee Indemnified Parties, including reasonable attorneys’ fees and
costs, whether or not action is instituted and, if instituted, whether at any
trial or appellate level, whether raised by the Transferee Indemnified Parties
or a third party, which
shall
or may
arise
by virtue of or in connection with (i) anything done or omitted to be done
by
Transferor in connection with this Agreement, (ii) any breach by Transferor
of a
covenant, warranty or representation contained herein, or (iii) anything done
or
omitted to be done by Transferor in connection with the Interests prior to
the
Execution Date or after the termination of this Agreement pursuant to Article
IX. Indemnity claims shall be payable when incurred by the Transferee
Indemnified Parties.
9
Section
2. Indemnification
of Transferor by Transferee.
Transferee hereby agrees to indemnify and hold Transferor, its Affiliates,
officers, directors, managers, members, employees, partners, shareholders,
agents and their respective heirs, personal representatives, successors and
assigns (the “Transferor Indemnified Parties”) harmless from and against any and
all claims, demands, actions, proceedings, investigations and rights of action
asserted by any third party against any of the Transferor Indemnified Parties,
including reasonable attorneys’ fees and costs, whether action is instituted or
not and, if instituted, whether at any trial or appellate level, whether raised
by the Transferor Indemnified Parties or a third party, which shall or may
arise
by virtue of or in connection with (i) anything done or omitted to be done
by
Transferee with respect to the obligations of Transferee pursuant to this
Agreement, or (ii) any breach by Transferee of a covenant; warranty or
representation contained herein. Indemnity claims shall be payable when incurred
by the Transferor Indemnified Parties.
Section
3. Limitation
on Indemnification.
The
maximum amount of losses that either Party will be responsible to bear under
Sections 1 and 2, respectively, of this Article X is One Million Dollars
($1,000,000). This maximum amount shall not apply to losses resulting from
either Party’s fraud, intentional misrepresentation, intentional breaches of
covenants, or intentional violations of any Law.
ARTICLE
XI.
MISCELLANEOUS
Section
1. Notices.
All
notices, requests and other communications hereunder must be in writing and
will
be deemed to have been duly given only if delivered personally or by messenger
(including by air courier) or by facsimile transmission or mailed (first class
postage prepaid) to the Parties at the following addresses or facsimile
numbers:
10
If
to
Transferee, to:
BLUEFIRE
ETHANOL, INC.
31
▇▇▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇▇▇ ▇▇▇▇▇
Tel:
(949) 588-3767 ext. 310
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
If
to
Transferor, to:
ARK
ENERGY, INC.
31
▇▇▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇ ▇▇▇▇▇▇
Tel:
(▇▇▇) ▇▇▇-▇▇▇▇, ext. 304
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
All
such
notices, requests and other communications will (i) if delivered personally
or
by messenger (including by air courier) to the address as provided in this
Section, be deemed given upon delivery, (ii) if delivered by facsimile
transmission to the facsimile number as provided in this Section, be deemed
given upon receipt, and (iii) if delivered by mail in the manner described
above
to the address as provided in this Section, be deemed given upon receipt (in
each case regardless of whether such notice, request or other communication
is
received by any other Person to whom a copy of such notice, request or other
communication is to be delivered pursuant to this Section). Any Party from
time
to time may change its address, facsimile number or other information for the
purpose of notices to that Party by giving notice specifying such change to
the
other Party.
Section
2. Entire
Agreement.
Each
appendix and exhibit delivered pursuant to this Agreement will be in writing
and
will constitute a part of this Agreement. This Agreement, together with those
appendices and exhibits, constitutes the entire agreement among the Parties
pertaining to the subject matter of this Agreement and supersedes all the
Parties’ prior agreements and understandings in connection
therewith.
Section
3. Expenses.
Except
as otherwise expressly provided in this Agreement, whether or not the sale
of
the Interests contemplated hereby are consummated, each Party will pay its
own
costs and expenses incurred in connection with the negotiation, execution and
Execution of this Agreement and the transactions contemplated
hereby.
Section
4. Public
Announcements.
Any
public announcement reporting the transfer hereunder or concerning the
transactions contemplated hereby shall be made at the sole discretion of
Transferee. Transferor will not issue or make any reports, statements or
releases to the public with respect to this Agreement or the transactions
contemplated hereby without the prior written consent of Transferee.
11
Section
5. Waiver.
Any
term or condition of this Agreement may be waived at any time by the Party
that
is entitled to the benefit thereof, but no such waiver shall be effective unless
set forth in a written instrument duly executed by or on behalf of the Party
waiving such term or condition. No waiver by any Party of any term or condition
of this Agreement, in any one or more instances, shall deemed to be or construed
as a waiver of the same or any other term or condition of this Agreement on
any
future occasion. All remedies, either under this Agreement or by Law or
otherwise afforded, will be cumulative and not alternative.
Section
6. Further
Assurances.
Subject
to the terms and conditions of this Agreement, at any time or from time to
time
after the Execution, each of the Parties shall execute and deliver such other
documents and instruments, provide such materials and information and take
such
other actions as may reasonably be necessary, proper or advisable, to the extent
permitted by Law, to fulfill its obligations under this Agreement.
Section
7. Amendment.
This
Agreement may be amended, supplemented or modified only by a written instrument
duly executed by or on behalf of each Party.
Section
8. No
Third Party Beneficiary.
The
terms and provisions of this Agreement are intended solely for the benefit
of
each Party and their respective successors or permitted assigns, and it is
not
the intention of the Parties to confer third-party beneficiary rights upon
any
other Person.
Section
9. No
Assignment; Binding Effect.
Transferee may assign this Agreement in whole or in part at any time, or from
time to time, in its sole discretion; provided, however, any such assignee
shall
assume Transferee’s obligations hereunder (in whole or in part, as appropriate).
Neither this Agreement nor any right, interest or obligation hereunder may
be
assigned by Transferor without the prior written consent of Transferee and
any
attempt to do so will be void. Subject to the preceding sentences, this
Agreement is binding upon, inures to the benefit of and is enforceable by the
Parties and their respective successors and assigns.
Section
10. Headings.
The
headings used in this Agreement have been inserted for convenience of reference
only and do not define or limit the provisions hereof.
Section
11. Invalid
Provisions.
If any
provision of this Agreement is held to be illegal, invalid or unenforceable
under any present or future Law, and if the rights or obligations of any Party
under this Agreement will not be materially and adversely affected thereby,
(a)
such provision will be fully severable, (b) this Agreement will be construed
and
enforced as if such illegal, invalid or unenforceable provision had never
comprised a part hereof, and (c) the remaining provisions of this Agreement
will
remain in full force and effect and will not be affected by the illegal, invalid
or unenforceable provision or by its severance herefrom.
Section
12. Governing
Law.
This
Agreement shall be governed in all respects by and construed in accordance
with
the laws of the State of Nevada without regard to principles of conflicts of
laws.
12
Section
13. Arbitration.
Any
controversy or claim arising out of or relating to this Agreement, its
enforcement or interpretation, or because of an alleged breach, default, or
misrepresentation in connection with any of its provisions, shall be submitted
to final and binding arbitration, to be held in ▇▇▇▇▇ County, Nevada in
accordance with the Commercial Arbitration Rules or then existing rules for
commercial arbitration of the American Arbitration Association. The arbitrator
shall be selected by mutual agreement of the parties; if none, then by striking
from a panel of arbitrators from the American Arbitration
Association.
Section
14. Attorneys’
Fees.
In the
event of any arbitration or other proceeding between any of the Parties with
respect to any of the transactions contemplated hereby or subject matter hereof,
the prevailing Party shall, in addition to such other relief as the arbitrator
may award, be entitled to recover reasonable attorneys’ fees, all costs of the
arbitration, including but not limited to, the arbitration fees, court reporter
fees, etc. (and including, if applicable, any costs at the trial and appellate
levels and in any bankruptcy proceeding), and expenses of
investigation.
Section
15. Counterparts.
This
Agreement may be executed in any number of counterparts, each of which will
be
deemed an original, but all of which together will constitute one and the same
instrument.
Section
17. Conflict.
In the
event of any conflict between the terms of this Asset Transfer and Acquisition
Agreement and the terms of the Assignment of Interests, the terms of the Asset
Transfer and Acquisition Agreement shall prevail.
[Remainder
of page intentionally left blank]
13
IN
WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
duly
authorized officer of each Party as of the date first above written (“Execution
Date”).
| BLUEFIRE ETHANOL, INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇ | |
|
Name: ▇▇▇▇▇▇ ▇▇▇▇▇ |
||
| Title: President | ||
|
ARK
ENERGY, INC., A
Nevada corporation
|
||
| |
|
|
| By: | /s/ ▇▇▇▇ ▇▇▇▇▇▇ | |
|
Name: ▇▇▇▇ ▇▇▇▇▇▇ |
||
| Title: Vice President | ||
14
APPENDIX
I
DESCRIPTION
OF INTERESTS
| · |
Process
Design Package for the Sacramento Biorefinery Project prepared by ▇▇▇▇▇▇▇
Engineers;
|
| · |
Permits,
Work Product, reports, data and any and all information obtained in
connection with the project opportunities listed on Table
1
in
connection with the Arkenol Technology in the North American
Market;
|
| · |
Any
and all data collected regarding the geographical location of potential
sites, environmental conditions, infrastructure, regulatory requirements;
|
| · |
Any
and all correspondences regarding meetings or telephone calls with
utilities, governmental or regulatory agencies, vendors, or potential
clients for facility outputs;
|
| · |
Any
and all draft or completed business plans for potential
facilities;
|
| · |
Any
and all engineering design or data developed for potential projects;
|
| · |
Any
and all research, data or reports on market information for facility
outputs;
|
| · |
All
documents, studies, reports, material, data, files, contact lists or
other
information or know-how developed, owned, held or obtained by Transferor
in connection with project opportunities;
and
|
| · |
All
other rights of the Transferor (including, but not limited to, development
rights, work product and other intellectual, tangible and intangible
property) comprising or relative to project
opportunities.
|
| · |
All
rights (including all intellectual property rights), title and interest
in
and to all assets, contract rights, products, reports, studies, drawings,
tracings, schedules, photographs, slides, estimates, specifications,
diagrams, models, calculations and other results of work by Transferor,
including any and all development rights and assets that are part of
or
relate in any way to project opportunities.
|
1
Table
1
|
Project
Name
|
Location
|
Pilot
Analysis
|
Engineering
|
Site
Development
|
Feedstock
|
Benefit
to
BlueFire
|
||
|
1
|
California
#1
|
El
Sobrante, Simi, Bradley, Meccca, Orange County
|
$700
|
Urban
wood & green waste
|
1,2,3,4,5
|
|||
|
▇
|
▇▇▇▇▇▇▇▇▇▇
#▇
|
▇▇▇▇▇▇,
▇▇
|
$200
|
Ag
waste
|
||||
|
▇
|
▇▇▇▇▇▇▇▇▇▇
#▇
|
▇▇▇
▇▇▇▇▇, ▇▇
|
$1,500
|
$2,000
|
$5,000
|
Ag
waste
|
1,2,3,4,5,6
|
|
|
4
|
California
#4
|
City
of Industry
|
$10
|
Post
sorted MSW
|
2
|
|||
|
5
|
California
#5
|
Alameda
Corridor
|
$35
|
▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
|
▇
|
|||
|
▇
|
▇▇▇▇▇▇▇▇▇▇
#▇
|
Thermo
Fibergen
|
$32
|
|||||
|
7
|
Canada
|
Suncor
|
$20
|
|||||
|
8
|
▇▇▇▇▇▇▇
# ▇
|
▇▇▇▇▇▇,
▇▇
|
$40
|
$100
|
Sorghum
|
1,2,3,4
|
||
|
▇
|
▇▇▇▇▇▇▇
# ▇
|
▇▇.
▇▇▇▇▇, ▇▇
|
$50
|
Urban
green waste
|
1,2,5
|
|||
|
▇▇
|
▇▇▇▇
▇▇▇▇▇
|
▇▇▇▇▇▇,
▇▇
|
$400
|
$2,000
|
$2,000
|
Urban
green waste
|
1,2,3,4,5,6
|
|
|
11
|
Hawaii
|
Various
|
$30
|
$800
|
Ag
waste
|
1,2,3,5
|
||
|
12
|
Illinois
|
▇▇▇▇▇▇▇,
IL
|
$30
|
$300
|
Post
sorted MSW
|
1,2
|
||
|
▇▇
|
▇▇▇▇▇▇▇▇▇
#▇
|
▇▇▇▇▇▇,
▇▇
|
$60
|
$50
|
$150
|
▇▇▇/▇▇▇
|
▇,▇,▇
|
|
|
▇▇
|
▇▇▇▇▇▇▇▇▇
#▇
|
▇▇▇▇▇▇▇,
▇▇
|
$60
|
$100
|
$150
|
▇▇▇/▇▇▇
|
▇,▇,▇
|
|
|
▇▇
|
▇▇▇▇▇▇▇▇▇
#▇
|
▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇
|
$30
|
$50
|
$200
|
▇▇▇/▇▇▇
|
▇,▇,▇
|
|
|
▇▇
|
▇▇▇▇▇▇▇▇▇
#▇
|
▇▇▇▇▇▇▇,
▇▇
|
$30
|
$50
|
$200
|
▇▇▇▇▇▇
▇▇▇▇▇
|
▇,▇
|
|
|
▇▇
|
▇▇▇
▇▇▇▇▇▇
|
▇▇▇▇▇▇▇▇▇
|
$50
|
Urban
green waste
|
3
|
|||
|
▇▇
|
▇▇▇▇▇▇▇▇▇▇▇
#▇
|
▇▇▇▇▇▇▇▇▇▇▇,
▇▇
|
$300
|
Urban
green waste
|
1,3
|
|||
|
19
|
Pensylvania
#2
|
Urban
green waste
|
1,3
|
|||||
|
Subtotal
($1000s)
|
$2,222
|
$4,250
|
$10,255
|
|||||
|
Grand
Total ($1000s)
|
$16,727
|
|
Benefits
Legend:
|
|
|
1
|
Siting
and location
|
|
2
|
Feedstock
definition
|
|
3
|
Product
off-take
options
|
|
4
|
Site
use/ permitting
|
|
5
|
Infrstructure
requirements
|
|
6
|
Co-location
with
another
facility
|
2
EXHIBIT
A
ASSIGNMENT
OF INTERESTS
THIS
ASSIGNMENT OF INTERESTS, dated as of the 1st
day of March, 2006 by and between ARK ENERGY, INC., a Nevada corporation (the
“Transferor”), and BLUEFIRE ETHANOL, INC., a to be formed Nevada corporation
(the “Transferee”),
W
I T N E
S S E T H
WHEREAS,
pursuant to that certain Asset Transfer and Acquisition Agreement dated as
of
March 1, 2006 (as amended, supplemented or otherwise modified from time to
time,
the “Asset Transfer and Acquisition Agreement”), by and between Transferor and
Transferee, Transferor has agreed to transfer, assign, convey, transfer and
deliver all of its respective rights, title and interest in and to the Interests
(as defined in the Asset Transfer and Acquisition Agreement) to Transferee
and
Transferee has agreed to receive and acquire such Interests from Transferor,
all
as more fully described in the Asset Transfer and Acquisition Agreement;
and
WHEREAS,
pursuant to the Asset Transfer and Acquisition Agreement, Transferor and
Transferee have agreed to enter into this Assignment of Interests pursuant
to
which the Interests will be conveyed to Transferee.
NOW,
THEREFORE, in consideration of the foregoing premises and for other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the parties hereto agree as follows:
1. Defined
Terms.
Capitalized terms which are used but not defined in this Assignment of Interests
shall have the meaning ascribed to such terms in the Asset Transfer and
Acquisition Agreement.
2. Assignment.
Subject
to the terms and conditions of the Asset Transfer and Acquisition Agreement,
Transferor does hereby transfer, assign, convey, transfer and deliver to
Transferee all of Transferor’s right, title and interest in and to all of the
Interests. Transferor agrees to execute and deliver such other documents and
instruments requested from time to time by Transferee, including assignments
in
recordable form, and take such other actions as may reasonably be necessary,
proper or advisable, to evidence the assignment of the Interests described
herein.
3. Appointment.
Transferor hereby constitutes and appoints Transferee and its successors and
assigns as Transferor’s true and lawful attorney, with full power of
substitution, in Transferor’s name and stead, by, on behalf of and for the
benefit of Transferee, and its successors and assigns, to demand and receive
any
and all of the Interests transferred hereunder and to give receipts and releases
for and in respect of the same, and any part thereof, and from time to time
to
institute and prosecute, at the expense and for the benefit of Transferee,
and
its successors and assigns, any and all proceedings at law, in equity or
otherwise, which Transferee, and its successors or assigns, may deem proper
for
the collection or reduction to possession of any of the Interests transferred
hereunder or for the collection and enforcement of any claim or right of any
kind herby sold, assigned, conveyed, transferred and delivered, and to do all
acts and things in relation to the Interests transferred hereunder which
Transferee, and its successors or assigns, shall deem desirable.
A-1
4. No
Third Party Beneficiaries.
Nothing
in this instrument, express or implied, is intended or shall be construed to
confer upon, or give to, any person other than Transferee any remedy or claim
under or by reason of this instrument or any agreements, terms, covenants or
conditions hereof, and all the agreements, terms, covenants and conditions
in
this instrument contained shall be for the sole and exclusive benefit of
Transferee and its successors and permitted assigns.
5. Binding
Effect, Assignment.
This
Assignment of Interests and all of the provisions hereof shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
6. Governing
Law.
This
Assignment of Interests shall be governed in all respects by and construed
in
accordance with the laws of the State of California without regard to principles
of conflicts of laws.
7. Construction.
This
Assignment of Interests is delivered pursuant to and is subject to the Asset
Transfer and Acquisition Agreement. In the event of any conflict between the
terms of the Asset Transfer and Acquisition Agreement and the terms of this
Assignment of Interests, the terms of the Asset Transfer and Acquisition
Agreement shall prevail.
[Remainder
of page intentionally left blank]
A-2
IN
WITNESS WHEREOF, this Assignment of Interests has been duly executed and
delivered by the duly authorized officers of the parties hereto as of the date
first above written.
|
ARK
ENERGY, INC., a
Nevada corporation
|
||
| |
|
|
| By: | /s/ ▇▇▇▇ ▇▇▇▇▇▇ | |
|
Name: ▇▇▇▇ ▇▇▇▇▇▇ |
||
| Title: Vice President | ||
|
BLUEFIRE
ETHANOL, INC.
a
to-be formed Nevada Corporation
|
||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇ | |
|
Name: ▇▇▇▇▇▇ ▇▇▇▇▇ |
||
| Title: President | ||
A-3