Attached files
| file | filename |
|---|---|
| 8-K - KL Energy Corp | v197695_8k.htm |
| EX-10.1 - KL Energy Corp | v197695_ex10-1.htm |
Exhibit
10.2
Master
Collaboration Agreement
This
Master Collaboration Agreement (“Agreement”) is made as of August 30, 2010 (the
“Effective Date”), by and between KL Energy Corporation, a Nevada corporation
with offices at 306 East St. Joseph Street, Suite 200, Rapid City, South Dakota
57701 (the “Company”), and add blue Consultoria Ltda., a company organized in
Brazil with offices at Rua Joaquim Nabuco, 47, office 81, Brooklin, City of São
Paulo, State of São Paulo, 04621-000 (“Add Blue”).
WHEREAS,
the Company and Add Blue have previously entered into certain arrangements and
agreements, including but not limited to‘Call Option Agreement’ signed on
October 08th ,2008;
‘Cooperation, Services & Call Option Agreement’ signed on March 04th, 2009;
‘Petrobras, add blue and KL Energy Memorandum of Understanding’ signed on
January 18th , 2010
(collectively, the “Prior Agreements”);
WHEREAS,
pursuant to the Prior Agreements, Add Blue have previously referred to, and
assisted, the Company in developing certain of its businesses in
Brazil;
WHEREAS,
the parties hereto desire to enter into a new arrangement regarding their
business relationship, and this Agreement shall replace and supersede all of the
Prior Agreements; and
WHEREAS,
it is an express condition, and an inducement, for the Company in entering into
this Agreement that Add Blue expressly waive any and all rights, throughout the
world, it may have in respect to any and all of the Company’s intellectual
property, whether obtained through the Prior Agreements or
otherwise.
NOW,
THEREFORE, in consideration of the mutual premises contained herein, the parties
agree as follows:
1.
Waiver
of Intellectual Property Rights; Option Cancellation.
1.1 Waiver and
Acknowledgement. Add Blue hereby waives any and all rights,
options, licenses, and any other intellectual property rights it may have,
throughout the world, in respect of any and all of the Company’s intellectual
property, whether granted through the Prior Agreements or
otherwise. Add Blue hereby agrees and acknowledges that effective
upon the full execution of this Agreement by the parties hereto, Add Blue shall
have no rights to any and all of the Company’s intellectual
property.
1.2 Option
Cancellation. The parties hereby agree and acknowledge that
the option that Add Blue previously granted to the Company to purchase or
subscribe for 20% of Add Blue is hereby cancelled and no longer in
effect.
2.
Payments,
Conditions and Stock Issuances.
2.1 Payments. Subject
to Section 2.2 below, the Company shall pay to Add Blue the following payments
in accordance to the payment schedule set forth below:
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a)
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US$
250,000 due on September 01, 2010;
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b)
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US$
200,000 due September 08, 2010;
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c)
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US$
200,000 due on October 15, 2010;
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d)
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US$
200,000 due on November 15, 2010;
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e)
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US$
200,000 due on December 15, 2010;
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f)
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US$
200,000 due on January 2, 2011;
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g)
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US$
500,000 due on June 15, 2011;
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h)
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US$
500,000 due on July 15, 2011; and
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i)
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US$
333,333.00 due on August 15, 2011.
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2.2 Conditions to the
Payments. Notwithstanding anything contained in Section 2.1
above, the Company’s obligation to make any of the payments set forth in
Sections 2.1 (a), (b), (c), (d), (e), (f), (g), (h) and (i) above shall be
subject to the Company receiving certain contractually agreed funds as specified
in Exhibit A
attached hereto and shall be subject to adjustment as set forth in Exhibit
A.
2.3 Stock
Issuances. The Company agrees to issue to Add Blue, or its
nominee (the “Investor”), 1,500,000 shares of the Company’s common stock by
September 30, 2010, subject to the satisfaction by the Investor of any and all
applicable securities laws and other regulations in respect of the stock
issuance, as determined in the reasonable discretion of the Company’s legal
counsel. In addition, in the event that the required conditions for
the payment set forth in Section 2.1 (i) have been satisfied, then the Company
agrees to issue to the Investor an additional 500,000 shares of the Company’s
common stock.
3.
Agreement to Form Joint
Venture. The Company agrees to form, at its own expense and
with the support and assistance of Add Blue, a Brazilian subsidiary (“Newco”) by
November 30, 2010. Newco shall be owned 60% by the Company and 40% by
Add Blue (the “Add Blue Equity Interest”). The Company agrees to
provide a license to Newco to use the Company’s intellectual property as
required by the business to be engaged by Newco. The Company shall
have the option (the “Purchase Option”) to acquire the Add Blue Equity Interest,
which Purchase Option can be exercised by the Company, in its sole discretion,
by issuing to Add Blue 1,000,000 shares (the “Option Consideration”) of the
Company’s common stock; provided, however, the Purchase Option shall expire upon
14 days after the effective formation of Newco (the “Option
Period”). In addition, during the Option Period and if the Purchase
Option has not been exercised by the Company, Add Blue may sell all or part of
the Add Blue Equity Interest to a qualified investor subject to compliance with
any and all applicable securities laws; provided, however (i) Add Blue provides
the Company with prior written notice and the Company elects not to exercise the
Purchase Option; and (ii) Add Blue obtains the Company’s prior written consent
to the sale of the Add Blue Equity Interest to the proposed purchaser, which
consent shall not be unreasonably withheld. In the event that during
the Option Period the Purchase Option has not been exercised and not all of the
Add Blue Equity Interest have been sold to a qualified third party pursuant to
this Section 3, then upon the expiration of the Option Period the Purchase
Option shall be automatically exercised by the Company to acquire all of the
remaining Add Blue Equity Interest held by Add Blue, and the Option
Consideration. shall be adjusted pro rata based on the amount of Add Blue Equity
Interest that remain at the expiration of the Option Period.
4.
Management
Services. The parties hereto agree to amend the arrangement
setting forth the executive management services provided by Peter Gross to the
Company, pursuant to an existing consulting agreement between the Company and
Add Blue, such that the compensation terms for Mr. Gross will be a monthly
payment of US$ 20,000 payable beginning on September 1, 2010 and that the
Company will reimburse all service-related and approved expenses. The
other terms of the amendment agreement shall be commensurate with the terms and
conditions as currently set forth in the consulting agreement, and the parties
hereto agree to negotiate in good faith in the consummation of this amendment
agreement.
5.
Term and Termination
5.1 Term. This
Agreement will remain in force from the Effective Date for a period of 540 days,
unless earlier terminated in accordance with this Section 5. Upon the
expiration of such term, this Agreement will automatically renew for an
additional period of 360 days, unless either party gives no less than 30 days
prior written notice of its intention to terminate this Agreement.
5.2 Default. If either
party materially defaults in the performance of any of its material obligations
hereunder and if any such default is not corrected within 30 days after notice
in writing, then the non-defaulting party, at its option, may, in addition to
any other remedies it may have, thereupon terminate this Agreement by giving
written notice of termination to the defaulting party; provided however, no
party will be deemed to be in breach of this Agreement, and there shall be no
termination for default, during such time that a party makes diligent efforts to
correct a default which is capable of correction.
5.3 Insolvency. This
Agreement may be terminated by either party, upon written notice: (i) upon the
institution by the other party of insolvency, receivership or bankruptcy
proceedings or any other proceedings for the settlement of its debts, (ii) upon
the institution of such proceedings against the other party, which are not
dismissed or otherwise resolved in its favor within 60 days thereafter, (iii)
upon the other party's making a general assignment for the benefit of creditors,
or (iv) upon the other party's dissolution or ceasing to conduct business in the
ordinary course.
5.4 Survival. The parties’ rights
and obligations of Sections 1, 5.5, and 6 will survive any termination or
expiration of this Agreement.
5.5 Limitation of Liability upon
Termination. In the event of termination by either party in
accordance with any of the provisions of this Agreement, neither party will be
liable to the other, because of such termination, for compensation,
reimbursement or damages on account of the loss of prospective profits or
anticipated sales or on account of expenditures, investments, or commitments in
connection with the business or goodwill.
6.
Warranties,
Indemnities, and Limitations of Liability
6.1 General
Warranties. Each party hereby represents and warrants
that:
(a) it has
the right to enter into this Agreement; it is a corporation duly organized,
validly existing, and in good standing under the laws of the state of its
incorporation; it has the corporate power and authority for, and has by all
necessary corporate action authorized, the execution and delivery of this
Agreement, and the performance of its obligations hereunder; and
(b) the
execution, performance and delivery of this Agreement by such party will not
conflict with or violate or result in any breach of, or constitute a default
under, any contract, agreement or other obligation of such party.
7.
Miscellaneous
7.1 Nonassignment/Binding
Agreement. Neither this Agreement nor any rights under this
Agreement may be assigned or otherwise transferred by either party, in whole or
in part, whether voluntarily or by operation of law, including by way of sale of
assets, merger or consolidation, without the prior written consent of the other
party. Subject to the foregoing, this Agreement will be binding upon
and will inure to the benefit of the parties and their respective successors and
assigns.
7.2 Independent Contractors. The
relationship of the parties under this Agreement is that of independent
contractors. Neither party will be deemed to be an employee, agent,
partner or legal representative of the other for any purpose and neither will
have any right, power or authority to create any obligation or responsibility on
behalf of the other.
7.3 Notices. Any notice
required or permitted under the terms of this Agreement or required by law must
be in writing and must be (a) delivered in person, (b) sent by
first class registered mail, or air mail, as appropriate, or (c) sent by
overnight air courier, in each case properly posted and fully prepaid to the
appropriate address set forth in the preamble to this
Agreement. Either party may change its address for notice by notice
to the other party given in accordance with this Section. Notices
will be considered to have been given at the time of actual delivery in
person, three (3) business days after deposit in the mail as set forth above, or
one (1) day after delivery to an overnight air courier service.
7.4 Force
Majeure. Neither party will be liable to the other party on
account of any loss or damage resulting from any delay or failure to perform all
or any part of this Agreement if such delay or failure is caused, in whole or in
part, by events, occurrences, or causes beyond the control and without
negligence of the parties. Such events, occurrences,
or causes will include, without limitation, acts of God, strikes, lockouts,
riots, acts of war, earthquake, fire and explosions, but the inability to meet
financial obligations is expressly excluded.
7.5 Waiver. Any waiver
of the provisions of this Agreement or of a party's rights or remedies under
this Agreement must be in writing to be effective. Failure, neglect,
or delay by a party to enforce the provisions of this Agreement or its rights or
remedies at any time, will not be construed as a waiver of such party's rights
under this Agreement and will not in any way affect the validity of the whole or
any part of this Agreement or prejudice such party's right to take subsequent
action. No exercise or enforcement by either party of any right or remedy under
this Agreement will preclude the enforcement by such party of any other right or
remedy under this Agreement or that such party is entitled by law to
enforce.
7.6 Severability. If
any term, condition, or provision in this Agreement is found to be invalid,
unlawful or unenforceable to any extent, the parties shall endeavor in good
faith to agree to such amendments that will preserve, as far as possible,
the intentions expressed in this Agreement. If the parties fail to
agree on such an amendment, such invalid term, condition or provision will be
severed from the remaining terms, conditions and provisions, which will continue
to be valid and enforceable to the fullest extent permitted by law.
7.7 Integration. This
Agreement (including the attachments and any addenda hereto signed by both
parties) contains the entire agreement of the parties with respect to the
subject matter of this Agreement and supersedes all previous communications,
representations, understandings and agreements, either
oral or written, between the parties with respect to said subject
matter. No terms, provisions or conditions of any purchase order,
acknowledgement or other business form that either party may use in
connection with the transactions contemplated by this Agreement will have any
effect on the rights, duties or obligations of the parties under, or otherwise
modify, this Agreement, regardless of any failure of a receiving party to
object to such terms, provisions or conditions. This Agreement may not be
amended, except by a writing signed by both parties.
7.8 Counterparts. This
Agreement may be executed in counterparts, each of which so executed will
be deemed to be an original and such counterparts together will constitute
one and the same agreement.
7.9 Governing Law. This
Agreement will be interpreted and construed in accordance with the laws of the
State of California and the United States of America, without regard to conflict
of law principles. All disputes arising out of this Agreement will be
subject to the exclusive jurisdiction of the state and federal courts located in
Orange County, California, and each party hereby consents to the personal
jurisdiction thereof.
The
parties have signed below to indicate their acceptance of the terms of this
Agreement.
| KL Energy Corporation | add blue Consultoria Ltda. | ||||
| By: |
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By: |
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| Name: |
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Name: |
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| Title: | Title: | ||||
Exhibit
A
Referenced
minimum received contractually agreed funds from a customer during the initial
term of this Contract cumulatively totaling, which amounts shall be received by
the Company from the customer by the applicable payment schedule dates set forth
in Section 2.1:
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2.1
(a)
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equal
or greater than US$ 1,000,000.00
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2.1
(b)
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equal
or greater than US$ 1,800,000.00
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2.1
(c)
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equal
or greater than US$ 2,600,000.00
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2.1
(d)
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equal
or greater than US$ 3,400,000.00
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2.1
(e)
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equal
or greater than US$ 4,200,000.00
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2.1
(f)
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equal
or greater than US$ 5,000,000.00
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2.1
(g)
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equal
or greater than US$ 6,500,000.00
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2.1
(h)
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equal
or greater than US$ 8,000,000.00
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2.1
(i)
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equal
or greater than US$
10,000,000.00
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In the
event that the Company receives funds in partial payments less than the amounts
specified above, then the Company’s payment obligations set forth in Section 2.1
shall be adjusted so that it is only obligated to pay proportional payments
equal to twenty-five percent (25%) of each of the partial payment received for
Sections 2.1 (a), (b), (c), (d), (e), and (f), and proportional payments equal
to thirty-three percent (33%) of each of the partial payments received for
Sections 2.1 (g), (h), and (i).
In the
event that the Company receives payments exceeding above values, the payments to
Add Blue shall be limited to the values defined in Section 2.1.