[SUSTAINABLE DEVELOPMENT TECHNOLOGY CANADA LOGO]
SUSTAINABLE DEVELOPMENT TECHNOLOGY CANADA
CONTRIBUTION AGREEMENT
THIS AGREEMENT (the "Agreement") is made in triplicate this 5th day of March
2004(the "Effective Date") between Canada Foundation for Sustainable Development
Technology, a corporation without share capital incorporated under the Canada
Corporations Act (Canada) and continued under the Canada Foundation for
Sustainable Development Technology Act (Canada) (hereinafter referred to as
"SDTC") and ▇▇▇▇ ▇▇▇▇▇ BioOil Co-Generation Limited Partnership a Limited
Partnership formed under the laws of Ontario. Canada (hereinafter referred to as
the "Lead Contractor").
WHEREAS SDTC is a not for profit foundation constituted for the purpose of
fostering the development and adoption of technologies that contribute to a
sustainable development technology infrastructure in Canada by contributing to
the rapid development. demonstration and pre-, commercialization of
technological solutions which address climate change and air quality; and
WHEREAS SDTC has entered into an agreement (the "Funding Agreement") with Her
Majesty the Queen in Right of Canada represented by the Minister of Natural
Resources and the Minister of the Environment dated March 26, 2001:
WHEREAS SDTC and the Lead Contractor agree that for the Lead Contractor to
perform the project entitled the ▇▇▇▇ Flooring BioOil Cogeneration Plant as
described in the Proposal dated 22 October 2002 and in the Work Plan attached
hereto as Schedule A (hereinafter referred to as the "Project" and assigned the
contract number SDTC-2002-B-448) to develop and demonstrate the technology for
the purpose of commercializing it, the Lead Contractor will require financial
assistance from SDTC: and
WHEREAS SDTC is willing to provide a Contribution (as defined herein) to the
Lead Contractor for the Project on and subject to the terms and conditions
contained herein.
NOW THEREFORE in consideration of the premises and the mutual covenants
contained herein SDTC and the Lead Contractor agree as follows:
I Interpretation
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1.1 Definitions. In this Agreement the following terms shall have the
following meaning` respectively and other terms may be defined elsewhere in this
Agreement:
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CONFIDENTIAL
Sustainable Development Technology Canada
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"Agreement", "hereto", "herein", "hereof', "hereunder" and similar expressions
refer to this Agreement and not to any particular section of this Agreement and
includes the Schedules attached hereto.
"Acceptance" means written acknowledgement by the Acceptance Authority that the
supplies or services including reports conform to applicable contract
requirements.
"Acceptance Authority" means SDTC or any of its delegates.
"Ancillary Agreements" means the ancillary agreements (other than this
Agreement) defined and described in the Master Consortium Agreement.
"Audited Project Report" shall have the meaning ascribed thereto in Section 6.2
hereof.
"Budget" shall have the meaning ascribed thereto in Section 5.1 (a) hereof, and
may be amended pursuant to Section 3,7 hereof.
"Business Day" shall mean any day other than a Saturday, Sunday or statutory
holiday in the Province of Ontario.
"Claim" has the meaning ascribed thereto in Section 3 3 hereof.
"Commercially Available" means, with respect to a product, generally available
to he sold, leased, licensed, sublicensed, distributed, deployed or otherwise
transferred in commercial quantities to customers or end users.
"Commercial Availability Date" means the date on which the product or
technologies developed pursuant to the Project are made Commercially Available
by the Lead Contractor, any member of the Consortium or by any other party.
"Completion Date" means the date on which the Project is completed in accordance
with the Work Plan.
"Competitive Entities" shall have the meaning ascribed thereto in Section 12.3
hereof
"Confidential Information" means any information, whether printed, in machine
readable form or otherwise, that is proprietary or confidential to the
disclosing party and disclosed to the receiving party and which is disclosed by
the disclosing party in writing and is marked as "Confidential" (or like
designation) at the time of disclosure.
"Consortium" means all the entities listed in Schedule D. "Contribution" has the
meaning ascribed thereto in Section 3.1 hereof
"Declaration" shall mean the declaration dated September 12. 2003 and filed by
the Lead Contractor under the Limited Partnerships Act (Ontario).
"Deliverables" means all project requirements including but not limited to
reports that are outlined in Schedule C. Deliverables may be priced or
not-priced.
"Dollars" means Canadian Dollars
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"Eligible Costs" include (a) all goods and services and professional and
technical personnel costs required to conduct the scientific and technical
activities directly related to the Project; and (b) where capital items are
specifically required for the delivery of the Project, such as data collection
equipment required as part of a time-limited research activity, or required for
development or demonstration of prototypes, the cost of. or the depreciated
value of such capital items.
"Eligible Project" means a project which is carried on, or primarily carried on,
in Canada by an Eligible Recipient and which will, in the reasonable opinion of
SDTC, develop or demonstrate any one of the following new technologies:
(a) technologies related to energy end-use technologies, such as transportation
and building technologies, and technologies to reduce ground level ozone:
(b) technologies related to sustainable energy production, such as hydrogen or
renewable energy technologies, conversion or combustion processes
technologies, fuel cells, CO, management technologies, particulate control
technologies and acid rain technologies;
(c) greenhouse gas emissions reduction technologies related to areas other than
energy production and use, such as technologies to reduce CO, in cement
manufacturing.
(d) air quality improvement technologies. such as toxic substance recovery
systems;
(e) enabling or cross-cutting technologies, such as sensors and controls, closed
loop waste treatment technologies, and process technologies for the purpose
of increasing energy efficiency : or
(f) any other new Sustainable Development technology related to climate change
and clean air
"Eligible Recipient" means an entity that (a) has been established, or has
entered into a collaborative arrangement for the purpose of participating in an
Eligible Project: (b) has expertise in Sustainable Development technology
projects, (c) has legal capacity in Canada or is composed of organizations. each
of which has legal capacity in Canada, and which undertakes to he jointly and
severally or solidarity liable for the obligations hereunder, (d) meets the
following criteria (1) will develop the project as a combination of a private
sector commercial corporation and one or more of the following: (A) a private
sector commercial corporation (which could be a technology supplier or a user of
technology). (B) a university or college, or (C) a private sector research
institute; or (ii) the entity is a not-for-profit corporation acting on behalf
of its membership, the purpose of which is to undertake or fund Sustainable
Development technology development or demonstration; and (e) is not an Excluded
Recipient.
"Event of Default" shall have the meaning ascribed in Section 13.1 hereof.
"Excluded Recipient" means any (a) federal department (as defined in section 2
of the FAA), (b) departmental corporation (as defined in section 2 of the FAA),
(c) parent Crown Corporation or wholly owned subsidiary of a parent Crown
Corporation (as defined in subsection 83(l ) of the FAA), (d) not-for-profit
corporation or trust controlled by a federal department. departmental
corporation, parent Crown Corporation or wholly owned subsidiary of a parent
Crown Corporation. (e) provincial department or ministry or any proponent or
corporation of a similar nature controlled directly or indirectly by a province
or (f) entity or person that does not have legal capacity in Canada.
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Any consortia members, partners, subcontractors, consultants or contributors to
the project that do not meet the definition of an Eligible Recipient may
collaborate with Eligible Recipients in relation to an Eligible Project, and can
contribute in-kind or advisory work, or perform work under contract to the
Eligible Recipient, provided that such parties do not receive direct funding
from SDTC.
"FAA" means the Financial Administration Act (Canada).
"Financial Statements" shall have the meaning ascribed in Section 8.10) hereof.
"Funding Agreement" means the agreement between SDTC and Her Majesty the Queen
in Right of Canada represented by the Minister of Natural Resources and the
Minister of the Environment dated March 26, 2001.
"GAAP" means the generally accepted accounting principles which are. for the
purposes of applying the same in accordance with the provisions of this
Contract, in effect in Canada, including those published in the handbook of the
Canadian Institute of Chartered Accountants, as the same arc generally applied
to Persons carrying on the type of business or activity carried on by SDTC
"General Partner" means Dynamotive Canada Inc.. a corporation incorporated under
the laws of Canada, the general partner of the Lead Contractor.
"Government Funding" means any grant, loan or other financial assistance from
any federal, provincial or municipal government or government agency, including
funding from SDTC pursuant to this Agreement and federal and provincial SRED tax
credits which relate to Project development work.
"Government Funding limit" shall have the meaning ascribed thereto in Section 3
2(b) hereof.
"Governmental Entity" shall have the meaning ascribed in Section 8.1 (d) hereof.
" Holdback" means money that is retained by SDTC for future disbursment until
all Project requirements have been completed as defined in Section 3.4 hereof.
"Insurance Policies" shall have the meaning ascribed in Section 7.6 hereof.
"Intellectual Property Rights" means any and all (by whatever name or known or
designated) tangible and intangible and now known or hereafter existing (a)
rights associated with works of authorship throughout the universe, including
but not limited to copyrights and moral rights, (h) trade secret rights, (c)
patents, designs. algorithms and other industrial property rights, (d) all other
intellectual and industrial property and proprietary rights of every kind and
nature throughout the universe and however designated (other than trademark and
trade name rights and similar rights), whether arising by operation of law,
contract, license or otherwise, and (e) all registrations, applications,
renewals, extensions, continuations. divisions or reissues thereof now or
hereafter in force throughout the universe (including without limitation rights
in any of the foregoing ).
"Limited Partnership Agreement" means the limited partnership agreement dated
December A 1, 2003 between the General Partner and the limited partner(s).
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"Master Consortium Agreement" means the agreement dated February l1, 2004 among
Dynamotive Energy Systems Corporation, Satin Finish Hardwood Flooring Limited,
Erie Flooring and Wood Products Ltd. And Magellan Aerospace Corporation.
"Milestone" means a milestone described in the Work Plan and in Schedule C
attached hereto, the achievement of which entitles the Lead Contractor to submit
a Claim to SDTC for payment of an installment of the Contribution, which
milestone may be amended pursuant to Section 3.7 hereof.
"Non-Eligible Costs" include (a) general overhead costs of the Lead Contractor,
including operating costs related to the general maintenance, repair and
overhead costs of the Lead Contractor; (b) the cost to purchase or lease real
property; (c) administrative costs not associated with eligible costs; (d)
conference or travel costs not specifically required for the project; (e) costs
of office supplies, equipment and furniture not required for the project; and
(f) capital costs associated with ongoing scientific or technical activities of
the Lead Contractor.
"Payment Date" means the date on which an installment of the Contribution is
paid by SDTC to the Lead Contractor.
"Project" means the Project described, or referred to in Schedule A, and defined
in the Proposal.
"Project Intellectual Property" means any and all intellectual and industrial
property developed, produced, created or invented in connection with the
performance of the Protect including. without limitation, data, techniques,
methods, processes, know-how, inventions, improvements, enhancements, designs,
formulae, photographs, drawings, plans, specifications, reports, studies,
technical and procedural manuals, programs including computer hardware and
software and source code, whether susceptible to copyright or not, proprietary
and confidential information, including technical data and customer and supplier
lists, trade secrets and know how and databases, and all Intellectual Property
Rights therein.
"Proposal" means the written document(s) supplied to SDTC by the Lead Contractor
and its consortium partners in response to the request for Phase If full
proposal
"Proposal Date" means the date of the Proposal.
"Sustainable Development" means development that meets the needs of the present
without compromising the ability of future generations to meet their own needs.
including technologies that will mitigate, substitute or sequester greenhouse
gas emissions and reduce criteria air contaminants.
"Work Plan" means the Work Plan for the Project attached hereto as Schedule A.
1.2 Currency. Unless otherwise indicated all dollar amounts referred to in
this Agreement. including the symbol $, refer to lawful money of Canada.
1.3 Knowledge. Where any representation, warranty or other statement in this
Agreement is expressed to be made by any parry to its knowledge or is otherwise
expressed to be limited in scope to matters known to a party, or of which a
party is aware, it shall mean such knowledge as is actually known to, or which
would have or should have come to the attention of such party, or if such party
is a corporation the officers or employees of such party who have overall
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responsibility for or knowledge of the matters relevant to such statement and
such party hereby' confirms that it has made appropriate inquiries of all such
officers and employees.
1.4 Schedules. The following are the Schedules attached to and incorporated
in this Agreement by' reference and deemed to be a part hereof:
Schedule A - Work Plan
Schedule B - Budget, Eligible Costs of Project and Summary of Contributions
Schedule C - Deliverables and Milestones
Schedule D - Consortium Members
Schedule E - Reports
2 Term
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The term of this Agreement shall commence on the Effective Date and, unless
terminated earlier in accordance with Section 13 hereof, shall continue in full
force and effect until the Acceptance by SDTC' of the Third Annual Project SDIRS
Report.
3 Contribution Payments
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3 1 Subject to the terms and conditions contained herein, SDTC shall pay to the
Lead Contractor up to $1,900,000.00 for Phase one of the Project and conditional
upon successful completion of Phase one of the Project shall pay to the Lead
Contractor an additional amount up to $3,100,000.00 (the "Contribution").
payable in installments as provided in Schedule C attached hereto. SDTC shall
not make any payment on account of any cost incurred by the Lead Contractor
prior to June 1, 2003 or in excess of the costs set out in the Project Budget
attached hereto as schedule B.
3.2 Notwithstanding any other provision of this Agreement.
(a) The Contribution shall not exceed fifty percent (50%) of the Eligible Costs
for the Project:
(b) the sum of all Government Funding for the Project, including the
Contribution, shall not exceed seventy-five percent (75%) of Eligible Costs for
the Project (the "Government Funding Limit"); and
(c) SDTC shall not have any obligation to pay the Contribution, or any
installment thereof, unless the Lead Contractor, on or before the first Payment
Date, has established, to the satisfaction of SDTC, that the Lead Contractor has
obtained a commitment, and has the financial capacity to finance the Project.
3.3 Installments of the Contribution shall be paid to the Lead Contractor upon
the achievement of' various project milestones and upon receipt by SDTC and SDTC
acceptance of all required reports. A written claim ("Claim") requesting an
installment payment for a milestone and all associated required reports shall be
submitted by the Lead Contractor upon the achievement of each Milestone in
accordance with the schedule of payments set out in Schedule C attached hereto
Each Claim shall include a statement of Eligible Costs incurred in connection
with the
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Milestone and shall be certified by an officer of the Lead Contractor and
accompanied by such supporting documentation as SDTC may require. Where the cost
of any item of a Claim exceeds $1,000.00 invoices or receipts shall be attached
to the Claim with respect to such items. Upon acceptance by SDTC of a Claim for
payment of an installment of the Contribution, SDTC shall pay to the Lead
Contractor such installment of the Contribution. SDTC shall have 45 days from
the receipt of all required reports to provide notice of acceptance or rejection
of a Claim. If a Claim is rejected by SDTC then SDTC will give notice of such
rejection to the Lead Contractor, together with its reasons therefor, and the
Lead Contractor shall have 20 days to provide revised reports in support of such
Claim. SDTC shall have 10 days to provide notice of acceptance or rejection of
revised reports. If the Claim is again rejected by SDTC then the aforementioned
process and time periods for the submission of reports will continue until such
time as the Claim is accepted or the Contract is terminated. Any Claim that is
reasonably rejected by SDTC after 3 submissions shall be considered to be an
Event of Default and SDTC may take action to terminate the contract. Payment of
a Claim shall be made only after acceptance by SDTC. Early delivery is
permitted, but SDTC shall not be required to release payment until the dates
specified in Schedule.
3.4 SDTC shall withhold ten percent l0%)(the "Holdback") from each installment
of the Contribution payable hereunder until:
(a) the Project has been completed to the satisfaction of SDTC;
(b) a final report documenting the completion of the Project has been
received and approved by SDTC: and
(c) SDTC has approved a final statement of Eligible Costs paid in respect
of the Project;
at which time, SDTC shall, subject to Section 3.6 hereof, pay the Holdback to
the Lead Contractor,
3.5 The obligation of SDTC to make a payment to the Lead Contractor of each
installment of the Contribution is subject to the fulfillment, or the waiver by
SDTC, of each of the following conditions on or before the time of each such
payment:
(a) Accuracy of Representations and Warranties. Each representation and
warranty contained in Section 8.1 hereof shall be true on and as of the Payment
Date with the same force and effect as though such representation and warranty
had been made on and as of that date; and
(b) Performance. The Lead Contractor shall have performed and complied
with all covenants, agreements and conditions contained in this Agreement
required to be performed or complied with by the Lead Contractor prior to or on
the Payment Date
3.6 The Lead Contractor acknowledges and agrees that in the event that:
(a) SDTC has paid a Claim and later determines that the Claim contained a
cost which was a Non-Eligible Cost, or
(b) Government Funding for the Project exceeds the Government Funding
Limit, or
(c) SDTC's contribution to the project exceeds 50 %, of the Project's
Eligible Costs,
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then the amount of the overpayment or the excess over the Government Funding
Limit, as the case may be, shall constitute a debt due to SDTC and the Lead
Contractor shall repay such amount to SDTC immediately or SDTC shall be entitled
to set-off such amount against future installments of the Contribution.
3.7 The Lead Contractor may propose reasonable amendments to any or all of the
Work Plan, Milestones or Budget, and shall provide SDTC with written notice of
the proposed amendment, including its scope, anticipated cost and anticipated
results. SDTC shall have the right to review the proposed amendment and to
consult with the Lead Contractor and with any external consultants as deemed
appropriate by SDTC in respect thereof. Within sixty (60) days of SDTC's receipt
of the aforementioned amendment notice: (i) if SDTC, after consultation with the
Lead Contractor and with any external consultants as deemed appropriate by SDTC.
does not agree with the proposed amendment, it shall not be accepted; or (ii) if
SDTC agrees with the proposed amendment, it shall so advise the Lead Contractor
in writing and the Agreement shall thereupon be deemed to he so amended without
requiring further acts of the parties. Lack of consent by SDTC to a proposed
amendment shall not preclude the Lead Contractor from submitting any other
reasonable proposed amendment in respect of any or all of the Work Plan,
Milestones or Budget at any other time
Costs
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4 l The Lead Contractor hereby certifies that: (a) all costs described in
Schedule B as Eligible Costs and submitted to SDTC for payment of an installment
of the Contribution arc accurate and arc Eligible Costs of the Project, and (b)
all labour rates submitted in the budget as Eligible Costs are equal to the
salary of the actual employee performing the work or if paid to a consultant and
not an employee are the lowest labour rates charged by any member of the
Consortium to a third party, and (c) the cost claimed for any equipment
submitted as an Eligible Cost shall not include profit to the Lead Contractor or
any member of the Consortium and must he supported by invoice, and (d) all costs
for labour rates claimed will he directly related to the person undertaking the
work.
4.2 SDTC may exercise its discretion in a reasonable manner to determine whether
a cost is an Eligible Cost or a Non-Eligible Cost.
4.3 lf, prior to the Completion Date of the Project, the Lead Contractor or any
other Consortium member sells, leases, or otherwise disposes of any equipment or
capital assets, where the cost of the equipment or capital assets is part of the
Eligible Costs under the Project to which SDTC has contributed under this
Agreement pursuant to a Claim by the Lead Contractor, the Lead Contractor shall
immediately notify SDTC in writing of the disposition and, if SDTC so requires,
the Lead Contractor shall share with SDTC the proceeds of the disposition in the
same ratio as that of SDTC's contribution to the purchase of the equipment or
capital assets, except that SDTC's share shall not exceed its Contribution
hereunder.
Reporting
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5.1 The Lead Contractor shall submit the following reports to SDTC in such form
and containing such information as SDTC may require from time to time:
(a) progress reports on Deliverables as provided in Schedule C attached
hereto:
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(b) an annual Project budget (the "Budget") (within 30 days prior to year end)
listing all project costs both actual and estimated and all expenses incurred;
(c) unaudited financial statements relating to the Project, including a
discussion of variances from the Budget, at the time of each Claim for the
payment of an installment of the SDTC contribution;
(d) a final report on the Project describing the outcome of the Project and
audited financial statements for the Project;
(e) emission impact reports at various stages of the Project as required by SDTC
and in the format required by SDTC (the SDIRS Report);
(f) follow-up reports due annually for three (3) years after the completion of
the Project which describes the diffusion of the technology developed and its
impact on emissions and Sustainable Development, in the format required by SDTC
and provided electronically by SDTC (the SDIRS Report) and referenced in
Schedule E;
(g) such other information and reports as may reasonably be requested by SDTC.
5.2 Subject to Section 10 hereof, Lead Contractor hereby grants to SDTC' a
license to copy and distribute all reports submitted to it pursuant to Section
5.1 hereof.
5.3 Upon completion of the Project, the Lead Contractor shall provide SDTC with
a certificate of an officer of the Lead Contractor setting out any contributions
or payments received by the Lead Contractor in respect of the Project in
addition to, or from sources other than, those named in its Proposal, and shall
further certify as to any amounts owing to SDTC resulting from such overfunding
and/or over-payment either as a result of changes in Project costs or accounting
errors, or both
6. Accounts, Audits and Inspections
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6.1 From the Effective Date and for a period of seven (7) years following the
Completion Date, the Lead Contractor shall:
(a) keep proper books, accounts and records of its financial contributions both,
cash and inkind, all its costs and expenses incurred and paid in connection
with the Project and shall keep invoices, receipts and vouchers relating thereto
(b) keep proper and accurate records relating to the environmental impact, sales
revenues, employment impacts, technology developments (including patents and
patent applications) and other impacts of the Project;
(c) on demand, make available to SDTC such books, accounts, records, invoices,
receipts and vouchers referred to above and permit SDTC to examine and audit and
take copies and extracts from such documents; and
(d) supply SDTC with any reports as requested in the format provided as
attachments to this contract.
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6.2 The Project shall be audited at the expense of the Lead Contractor and/or
the Consortium, by an auditor acceptable to SDTC at the end of the Project and
such auditor shall prepare a report (the "Audited Project Report") based upon
such audit. The Audited Project Report shall include an itemized statement of
all Eligible Costs incurred and paid for in connection with the Project. The
Project may also be audited by SDTC's auditors or another auditor acceptable to
SDTC, at SDTC's cost, at such other time or times as SDTC may require.
6.3 The Lead Contractor shall ensure that SDTC or its designate has reasonable
access during normal working hours to any premise or place where the Project is
being carried out for the purpose of inspecting and assessing the progress of
the Project and all matters relating thereto.
Covenants of the Lead Contractor
--------------------------------
7.1 I he Lead Contractor shall complete the Project by the Completion Date
unless the Completion) Date is extended by SDTC, in its sole discretion.
7.2 The Lead Contractor shall comply with all federal, provincial and municipal
laws in relation to the Project.
7.3 The Lead Contractor shall use commercially reasonable efforts to ensure that
within three (3) years of the Completion Date the Project Intellectual Property
and technology developed in connection with the Project, including any products,
processes or services relating thereto, is commercialized, marketed and deployed
for the benefit of Canada.
7.4 The Lead Contractor shall ensure that all employees or contractors working
on the Project assign any and all Intellectual Property Rights in and to any
Project Intellectual Property to the Lead Contractor or a member of the
Consortium and that each such employee or contractor also waives his or her
moral rights in any copyright arising in connection with the Project
Intellectual Property.
7.5 Except as provided in the Proposal, the Lead Contractor shall not
subcontract all or any part of the Project unless the Lead Contractor has
obtained the prior written consent of SDTC. Every subcontract entered into by
the Lead Contractor shall provide that the subcontractor shall comply with the
terms and conditions of this Agreement that are applicable to the subcontract
7.6 The Lead Contractor shall maintain valid policies of employer's liability
insurance and of insurance with respect to its properties and business (the
"Insurance Policies") of the kinds and in the amounts which are customary for
the nature and scope of the business carried on by the Lead Contractor and for
the Project.
7.7 The Lead Contractor shall perform all of its obligations under, comply with
all of the terms of. and enforce its rights under the Ancillary Agreements.
7.8 The Lead Contractor shall do or cause to be done all things necessary to
keep in full force and effect its existence as a limited partnership and all
rights, licenses, permits, approvals and qualifications necessary to carry on
its business or own property in each jurisdiction in which it carries on
business or owns property.
7.9 The Lead Contractor shall not, without the prior written consent of SDTC:
(a) amend the Limited Partnership Agreement or the Declaration:
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(b) effect or consent to the dissolution of the Lead Contractor;
(c) enter into, and not permit the General Partner to enter into, any
corporate transaction (whether by way of reorganization, consolidation,
amalgamation, merger or otherwise) pursuant to which all or substantially all of
the undertaking, property and assets of the Lead Contractor or the General
Partner, as the case may be, would become the property of any other party, or in
the case of an amalgamation, the property of the continuing corporation
resulting therefrom.
(d) permit any change in its general partner from the General Partner or
any change in the share ownership of the General Partner;
(e) permit any change in the membership of the Consortium.
8. Representations and Warranties
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8.1 Of the Lead Contractor. The Lead Contractor hereby represents and warrants
on its own behalf and on behalf of the Consortium and each member thereof, and
the Lead Contractor hereby acknowledges that SDTC is relying on such
representations and warranties for the purpose of entering into this Agreement:
(a) Corporate Power and Due Authorization. The General Partner has the corporate
power and capacity and authority under the limited Partnership Agreement to
execute and deliver this Agreement (and any agreements relating to this
Agreement) on behalf of the Lead Contractor. The Lead Contractor has the power
and capacity to perform its obligations under this Agreement. This Agreement has
been duly authorized, executed and delivered by the General Partner on behalf of
the Lead Contractor and is a valid and binding obligation of the Lead Contractor
enforceable against it in accordance with its terms, subject to bankruptcy.
insolvency. moratorium, reorganization and other laws relating to or affecting
the enforcement of creditors' rights generally, and the fact that equitable
remedies, including the remedies of specific performance and injunction, may
only be granted in the discretion of a court.
(b) Status. The Lead Contractor is a limited partnership duly registered under
the laws of the Province of Ontario and is validly existing under the laws of
such jurisdiction. The Lead Contractor is in good standing in each jurisdiction
where, by reason of its business or assets, it is required to be qualified or
licensed. The General Partner is a corporation incorporated under the laws of
the Province of Ontario and is validly existing under the laws of such
jurisdiction. The General Partner is in good standing in each jurisdiction
where, by reason of its business or assets, it is required to be qualified or
licensed.
(c) Capital Contributions. The capital contributions to the Lead Contractor
provided for in the Consortium Master Agreement and the Ancillary Agreements
have been made and neither the Consortium Master Agreement nor any of the
Ancillary Agreements has been amended and each such agreement continues in full
force and effect,
(d) Contribution Eligibility. The Lead Contractor is an Eligible Recipient and
the Project is an Eligible Project.
(e) No Conflicts. The execution and performance of the transactions contemplated
by this Agreement and compliance with their respective provisions by the Lead
Contractor will
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not (i) conflict with or violate any provision of the Limited Partnership
Agreement, (ii) except as provided for or required in this Agreement, require on
the part of the Lead Contractor any filing with, or any permit, authorization,
consent or approval of. any court, arbitration tribunal, administrative agency
or commission or other governmental or regulatory authority or agency (each of
the foregoing is hereafter referred to as a "Governmental Entity"), (iii)
conflict with, result in a breach of, constitute (with or without due notice or
lapse of time or both) a default under, result in the acceleration of, create in
any party the right to accelerate, terminate, modify or cancel, or require any
notice, consent or waiver under, any contract, lease, sublease, license,
sublicense, franchise, permit, indenture, agreement or mortgage for borrowed
money, instrument of indebtedness or other arrangement to which the Lead
Contractor is a party or by which the Lead Contractor is bound or to which its
assets are subject, other than any of the foregoing events which do not and will
not, individually or in the aggregate, have a material adverse effect on the
Lead Contractor, (iv) result in the imposition of any security interest upon any
assets of the Lead Contractor, or (v) violate any order, writ, injunction,
decree, statute, rule or regulation applicable to the Lead Contractor or any of
its properties or assets.
(f) Governmental Consents. No consent, approval, order or authorization of, or
registration, qualification, designation, declaration or filing with, any
Governmental Entity is required on the part of the Lead Contractor in connection
with the execution and delivery of this Agreement except such filings as shall
have been made prior to and shall he effective on and as of the Effective Date.
(g) Accuracy of Proposal. All factual matters contained in the Proposal and in
all material submitted in support are true and accurate, and that all estimates,
forecasts and other related matters involving judgment were prepared in good
faith and to the best of its ability, skill and judgment and that all costs
submitted to SDTC as Eligible Costs for reimbursement as an installment of the
Contribution hereunder are Eligible Costs
(h) Conduct of the Project The Lead Contractor shall carry out the Project
promptly, diligently and in a professional manner and in accordance with the
terms and conditions of this Agreement and the Proposal.
(i) Litigation. There is no action, suit, proceeding, or judgment or
governmental inquiry or investigation, pending, or, to the best of the Lead
Contractor's knowledge, any basis therefor or threat thereof, against the Lead
Contractor or to the best of the Lead Contractor's knowledge, any of the members
of the Consortium, or which questions the validity of this Agreement, or the
right of the Lead Contractor to enter into this Agreement, or which might
result, either individually or in the aggregate. in a material adverse effect,
nor is there any litigation pending, or, to the best of the Lead Contractor's
knowledge, any basis therefor or threat thereof, against the Lead Contractor or
any member of the Consortium by reason of the actual or proposed activities of
the Lead Contractor or the Consortium.
(j)Financial Statements. Upon request from SDTC the Lead Contractor will furnish
to SDTC a complete and correct copy of (i) the unaudited balance sheet of the
Lead Contractor (the "Balance Sheet") as at the date requested by SDTC and the
related unaudited statements of operations and cash flows for the requested
period, and (ii) the audited balance sheet of the Lead Contractor as at the date
requested by SDTC and the related audited statements of operations and cash
flows for the fiscal year then ended,
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STDC-2002-B-448 CONFIDENTIAL
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(collectively, the "Financial Statements"). The Financial Statements shall be
complete and correct, shall be in accordance with the books and records of the
Lead Contractor and present fairly the financial condition and results of
operations of the Lead Contractor, as at the dates and for the periods
indicated, and shall be prepared in accordance with GAAP, consistently applied.
(k) Insurance. The Insurance Policies arc in full force and effect and the Lead
Contractor is not in default (i) with respect to the payment of any premium or
(ii) with respect to any material provisions contained in such policies. The
Lead Contractor and each member of the Consortium maintains valid policies of
worker's compensation insurance to the extent required by law.
(l) Absence of Changes. Since the Proposal Date, there has not been: (a) any
change in the assets, liabilities, financial condition or operations of the Lead
Contractor or the Consortium or any member thereof from that reflected in the
Proposal and the Financial Statements, except changes in the ordinary course
of business that have not been, either individually or in the aggregate,
materially adverse; (b) any damage, destruction or loss, whether or not covered
by insurance, materially and adversely affecting the Project or the properties
or business of the Lead Contractor or any member of the Consortium.
(m) Permits. The Lead Contractor has all requisite licenses, permits and
certificates, including environmental, work, health and safety permits, from
federal, provincial and local authorities necessary to conduct its business and
to carry out the Project The Lead Contractor and each member of the Consortium
has complied (and will in carrying out the Project comply), in all material
respects, with all applicable laws.
(n) Environmental Matters The Lead Contractor and each member of the Consortium
has complied (and will in carrying out the Project comply) in all material
respects, with all applicable environmental laws. There is no pending or, to the
best knowledge of the Lead Contractor, threatened civil or criminal litigation,
written notice of violation, formal administrative proceeding, or investigation,
inquiry or information request by any Governmental Entity, relating to any
environmental law involving the Lead Contractor or any member of the Consortium
(o) Disclosures. Neither the Proposal, this Agreement, nor any Schedule attached
hereto, nor any report, certificate or instrument furnished to SDTC in
connection with the transactions contemplated by this Agreement, including the
financial projections provided by the Lead Contractor, when read together,
contains or will contain any untrue statement of a material fact or omits or
will omit to state a material fact necessary in order to make the statements
contained herein or therein, in light of the circumstances under which they were
made, not misleading.
8.2 Of SDTC. SDTC hereby represents and warrants to the Lead
Contractor and hereby acknowledges that the Lead Contractor is relying on such
representations and warranties for the purpose of entering into this Agreement:
(a) Corporate Power and Due Authorization. SDTC has the corporate power and
capacity to enter into and to perform its obligations under this Agreement. This
Agreement has been duly authorized, executed and delivered by SDTC and is a
valid and binding obligation of SDTC enforceable against it in accordance with
its terms, subject to bankruptcy, insolvency, moratorium, reorganization and
other laws relating to or affecting the
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STDC-2002-B-448 CONFIDENTIAL
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enforcement of creditors' rights generally, and the fact that equitable
remedies, including the remedies of specific performance and injunction, may
only be granted in the discretion of a court.
(b)Incorporation and Status. SDTC is duly incorporated and organized and validly
existing under the laws of Canada and is in good standing in each jurisdiction
where, by reason of its business or assets, it is required to be qualified or
licensed.
9. Intellectual Property
---------------------
Subject to Sections 13,2(d) and 13.2(e) hereof, title to all Intellectual
Property Rights in Project Intellectual Property shall vest in the Lead
Contractor and the members of the Consortium, in the manner agreed upon by the
Lead Contractor and the members of the Consortium, and, for greater certainty,
shall not vest in ▇▇▇▇
▇▇. Confidential Information
10.1 Any Confidential Information received by either party hereto pursuant to
this Agreement shall be used, disclosed, or copied, only for the purposes of,and
only in accordance with. this Agreement. The receiving party shall use, as a
minimum, the same degree of care as it uses to protect its own Confidential
Information of a similar nature, but no less than reasonable care, to prevent
the unauthorized use, disclosure or publication of Confidential Information.
Without limiting the generality of the foregoing:
(a) the receiving party shall only disclose Confidential Information to its bona
fide employees, contractors or suppliers who need to obtain access thereto for
purposes consistent with this Agreement:
(b) the receiving party shall not make or have made any copies of Confidential
Information except those copies which are necessary for the purposes of this
Agreement: and
(c) the receiving party shall affix to any copies it makes of the Confidential
Information, all proprietary notices or legends affixed to the Confidential
Information as they appear on the copies of the Confidential Information
originally received from the disclosing party.
10.2 The Lead Contractor recognizes the necessity for SDTC to provide
verification pursuant to the Funding Agreement to Her Majesty the Oueen (the
"Crown") in Right of Canada as represented by the Minister of Natural Resources
and the Minister of the Environment that the purpose and objectives of SDTC are
being achieved. The Lead Contractor shall cooperate with SDTC to enable SDTC to
effectively report to the Crown, provided however that SDTC shall not disclose
Confidential Information received from the Lead Contractor to the Crown unless
such Information is aggregated with similar information from other projects and
is not attributed to the Lead Contractor or other members of the consortium,
in which case the information will be deemed not to be
Confidential Information. Such aggregated information may include green
house gas emissions reduction and clean air impacts reporting, both estimated
and actual, and all other information reported under Section 5 after it has
been compiled by Sector, sub-sector, technology segment and/or region.
10.3 The receiving party shall not be bound by obligations restricting
disclosure and use set forth in this Agreement with respect to any Confidential
Information which:
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STDC-2002-B-448 CONFIDENTIAL
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(a) was known by the receiving party prior to disclosure, as evidenced by its
business records;
(b) was lawfully in the public domain prior to its disclosure, or lawfully
becomes publicly available other than through a breach of this Agreement or any
other confidentiality obligation on behalf of any third party;
(c) was disclosed to the receiving party by a third party provided such third
party, or any other party from whom such third party receives such information,
is not in breach of any confidentiality obligation in respect of such
information;
(d) is independently developed by the receiving party, as evidenced by its
business records; or
(e) is disclosed when such disclosure is compelled pursuant to legal, judicial,
or administrative proceedings, or otherwise required by law,
provided that the receiving party advises the disclosing party of any such
disclosure in a timely manner prior to making any such disclosure (so that
either party can apply for such legal protection as may be available with
respect to the confidentiality of the information which is to be disclosed), and
provided that the receiving party shall apply for such legal protection as may
be available with respect to the confidentiality of the Confidential Information
which is required to be disclosed.
10.4 Except for disclosures authorized under the terms of this Agreement, the
receiving party shall notify the disclosing party immediately upon learning of
any disclosure of the disclosing party's Confidential Information.
11. Indemnity
11.1 The Lead Contractor shall indemnify and save harmless SDTC and its hoard of
directors, members, employees and agents and the Government of Canada from and
against any and all claims. damages, loss, costs and expenses which they or any
of them may at any time incur or suffer as a result of or arising out of:
(a) any injury to persons (including injuries resulting in death) or loss of or
damage to property which may be or be alleged to be caused by or suffered as a
result of the carrying out of the Project or any part thereof, except to the
extent caused by the negligence of SDTC, its board members, employees or agents;
(b) any claim, demand or action for the infringement or alleged infringement of
any Intellectual Property Right of a third party based upon the use thereof by
the Lead Contractor or upon the use of the Project Intellectual Property by SDTC
or the Government of Canada in accordance with the terms hereof; and
(c)any claim, demand or action made by a third party against them or any of them
based upon SDTC's capacity as a provider of financial assistance under this
Agreement, including without limitation, any claim in respect of materials or
services provided by a third parry to the Lead Contractor or to a subcontractor
of the Lead Contractor.
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STDC-2002-B-448 CONFIDENTIAL
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12. Limitation of Liability
12.1 IN NO EVENT SHALL EITHER PARTY HAVE ANY LIABILITY FOR ANY INDIRECT,
INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES, HOWEVER CAUSED AND ON ANY THEORY
OF LIABILITY (INCLUDING NEGLIGENCE). ARISING OUT OF THIS AGREEMENT, INCLUDING
BUT NOT LIMITED TO LOSS OF ANTICIPATED PROFITS, EVEN IF SUCH PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THESE LIMITATIONS SHALL APPLY
NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.
12.2 Except for claims under Section 11.1(b) hereof, neither party shall be
liable to the other fort damages in excess of the amount of the Contribution
actually paid to the Lead Contractor by SDTC pursuant to this Agreement.
12.3 The Lead Contractor hereby acknowledges that SDTC may provide funding to
numerous companies, entities and consortia, some of which may be competitive
with the Lead Contractor or members of the Consortium or which may be
competitive with the Technology developed in connection with the Project
("Competitive Entities"). SDTC shall not be liable to the Lead Contractor for
any claim arising out of, or based on: (i) the provision of funding by SDTC to
any Competitive Entity; or (ii) actions taken by any partner, officer or other
representative of SDTC to assist a Competitive Entity (in the capacity as a
director of such company or otherwise), whether or not such action has a
detrimental effect on the Lead Contractor or the Project, provided that SDTC
will in all circumstances maintain the confidentiality of all information
provided to it by the Lead Contractor in accordance with the terns and
conditions hereof.
13 Termination of Agreement
13.1 The following shall constitute events of default (each an "Event of
Default") under this Agreement:
(a) the Lead Contractor becomes bankrupt or insolvent, goes into receivership,
or takes the benefit of any statute from time to time in force relating to
bankrupt or insolvent debtors.
(b) an order is made or resolution passed for the winding up of the Lead
Contractor, or the Lead Contractor is dissolved;
(c) the Lead Contractor has made misrepresentations to SDTC in respect of the
Proposal or this Agreement;
(d) the Lead Contractor is in material breach of this Agreement and such
material breach has not been remedied by the Lead Contractor within sixty (60)
days of receiving notice of such material breach from SDTC; or
(e) the rejection by SDTC of the third consecutive submission of any one report
in support of a Claim under section 3.3 hereof.
13.2 Upon the occurrence of an Event of Default, SDTC may, in its discretion
exercise one or more of the following options:
(a) terminate the whole or any part of this Agreement;
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STDC-2002-B-448 CONFIDENTIAL
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(b) suspend or terminate SDTC's obligation to pay any further installments of
the Contribution in respect of the Project, including monies due or accruing due
which have not yet been paid;
(c) in the event of a breach by the Lead Contractor of Section 3.2(a) and/or
3.2(b), exercise either of the remedies described in Section 3.6;
(d) Subject to Section 13.3, in the event of a breach by the Lead Contractor of
Section 7.3 hereof, SDTC (on behalf of Canada) may obtain from the Lead
Contractor and the Consortium either (i) a non-exclusive, worldwide,
unrestricted, fully paid up, royalty free, sub-licensable, license to use, or
(ii) an assignment of, the Intellectual Property developed in connection with
the project for any purpose, including to develop, copy, market, distribute,
commercialize, re-assign and otherwise exploit the Intellectual Property.
(e) request the Lead Contractor to transfer and assign to SDTC all of the Lead
Contractor's right, title and interest in and to: (i) equipment, capital assets
and supplies purchased by the Lead Contractor to carry out the Project (to the
extent such were acquired and reimbursed as Eligible Costs), and (ii) the
Project Intellectual Property; and-or
(f) direct the Lead Contractor to repay forthwith all or any part of the
Contribution paid by SDTC pursuant to this Agreement.
13.3 In the event that the Lead Contractor determines in good faith that (i) the
Project should be terminated prior to completion or (ii) at any time after
completion of the Project commercialization is not reasonably commercially
feasible, the Lead Contractor shall provide SDTC with detailed written reasons
for the termination of the Project or termination of commercialization as the
case may he. SDTC shall have a period of sixty (60) days to assess the Project
and the reasons for the Lead Contractor's determination that the Project should
not continue. In connection with such assessment by SDTC, SDTC may engage the
services of consultants and advisors and the Lead Contractor shall be
responsible for the fees and expenses relating thereto. In the event that SDTC
agrees that the Project or commercialization as the case may be, should be
terminated, SDTC shall give notice to the Lead Contractor that as of the date of
such notice from SDTC:
(a) this Agreement shall be terminated; and
(b) SDTC shall have no obligation to pay any further installments of the
Contribution in respect of the Project, other than amounts due or accruing due
as of the date of termination which have not yet been paid.
In the event that SDTC does not agree that the Project should be terminated,
then SDTC shall give notice to the Lead Contractor that as of the date of such
notice from SDTC:
(c) this Agreement shall be terminated;
(d) SDTC shall have no obligation to pay any further installments of the
Contribution in respect of the Project, including amounts due or accruing due as
of the date of termination which have not yet been paid; and
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STDC-2002-B-448 CONFIDENTIAL
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(e) request the Lead Contractor to transfer and assign to Canada all of the Lead
Contractor's right, title and interest in and to the Project Intellectual
Property and any project trade secrets.
13.4 SDTC may terminate this Agreement upon thirty (30) days written notice to
the Lead Contractor in the event of any substantial amendment to or the
termination of the Funding Agreement for any reason. In the event of the
termination hereof pursuant to this Section 13.3, any Claims submitted by the
Lead Contractor prior to the effective date of notice of termination shall be
processed by SDTC in accordance with the terms hereof. The Lead Contractor
hereby releases SDTC from any and all claims relating to the termination of this
Agreement pursuant to this Section 13.3 (other than the payment of any part of
the Contribution properly payable by SDTC to the Lead Contractor in accordance
with the terms and conditions hereof).
13.5 In the event that SDTC determines that the Project has not successfully
completed phase 1 than SDTC will be under no obligation to pay the second Phase
contribution of $3,100,000.00.
14. Fees and Expenses
Whether or not the transactions contemplated hereby are completed, the Lead
Contractor shall pay all reasonable out-of-pocket, due diligence and other
related expenses of SDTC including, without limitation, the fees and expenses of
legal counsel to SDTC relating to the negotiation and settlement of this
Agreement and the fees paid to consultants and advisors pursuant to Section
13.3. The Lead Contractor and members of the Consortium shall bear their
respective expenses incurred in connection with the negotiation, preparation,
execution and performance of this Agreement and the transactions contemplated
hereby, including, without limitation, all fees and expenses of agents.
representatives, counsel and accountants, and in no event shall SDTC he
responsible for such costs.
15. Assignment
This Agreement shall not be assigned in whole or in part by the Lead Contractor
without the prior written consent of SDTC and any assignment made without that
consent is void and of no force or effect.
16. Dispute Resolution
16.1 Best Endeavours to Settle Disputes. In the event of any dispute. claim,
question or difference arising out of or relating to this Agreement or any
breach hereof, the parties hereto shall use their best endeavours to settle such
dispute, claim, question or difference. To this effect, they shall consult and
negotiate with each other, in good faith and understanding of their mutual
interests, to reach a just and equitable solution satisfactory to all parties.
16.2 Mediation. If a dispute arising out of this Agreement cannot be settled
amicably through negotiation, then the parties agree that either party may
submit the dispute to mediation (as administered by the Arbitration and
Mediation Institute of Canada Inc.,) upon written notice to the other party. The
cost of mediation shall be borne equally by the parties.
16.3 Arbitration. Except as is expressly provided in this Agreement, if the
parties do not reach a solution pursuant to paragraph 16.1 or 16.2 within a
period of thirty (30) Business Days, then upon written notice by any party to
the other, the dispute, claim, question or difference shall be
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STDC-2002-B-448 CONFIDENTIAL
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finally settled by arbitration in accordance with the provisions of the
Arbitrations Act (Ontario) and any amendments thereto, based upon the following:
(a) the arbitration tribunal shall consist of one arbitrator appointed by mutual
agreement of the parties, or in the event of failure to agree within ten (10)
Business Days, any party may apply to a Court to appoint an arbitrator. The
arbitrator shall be qualified by education and training to pass upon the
particular matter to be decided;
(b) the arbitrator shall be instructed that time is of the essence in proceeding
with his determination of any dispute, claim, question or difference and, in any
event, the arbitration award must be rendered within thirty (30) Business Days
of the submission of such dispute to arbitration;
(c) the arbitration shall take place in Ottawa, Ontario and shall be conducted
in English;
(d) the arbitration award shall be given in writing and shall he final and
binding on the parties, not subject to any appeal, and shall deal with the
question of costs of arbitration and all matters related thereto:
(e) each party shall bear the cost of preparing its own case. The arbitrator
shall have the right to include in the award the prevailing party's costs of
arbitration and reasonable fees of attorneys, accountants, engineers and other
professionals incurred by it in connection with the arbitration; and
(f) judgment upon the award rendered may be entered in any Court having
jurisdiction, or, application may be made to such Court for a judicial
recognition of the award or an order of enforcement thereof, as the case may be.
In addition, if it appears to either party that the arbitrator lacks the power
to give effective interim relief, such party may apply to an appropriate Court
for such relief.
17 Publicity and Acknowledgements
17.1 The Lead Contractor will acknowledge the financial support of SDTC in all
publicly disseminated information relating to the Project unless otherwise
directed by SDTC. The Lead Contractor hereby consents and agrees to the
participation by SDTC or a representative of the Government of Canada at any
public ceremony relating to the Project and to have the ceremony take place on a
date mutually agreed upon by the Lead Contractor and SDTC The Lead Contractor
shall have the right to use SDTC's corporate name and logo provided that such
use is strictly in accordance with SDTC's policies relating thereto and only as
it relates to the Project and for no other use without the prior written consent
of SDTC.
17.2 No press releases, public announcements or other material prepared by the
Lead Contractor for promotional and general information purposes relating to the
Project, SDTC or the Contribution shall be issued or distributed to the public
without the prior written approval of SDTC.
17.3 SDTC may issue press releases and other materials prepared by SDTC for
promotional and general information purposes which refer to the Lead Contractor,
the Project and the Contribution without the approval or consent of the Lead
Contractor.
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STDC-2002-B-448 CONFIDENTIAL
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17.4 SDTC shall be permitted to use information about the Project that is
furnished in all reports submitted to it pursuant to Section 5.1 hereof and such
reports shall not be Confidential Information of the Lead Contractor.
18. Notices
18.1 All reports, delivery documentation, claims for payments, requests,
notices and information referred to in this Agreement shall be sent in writing,
or when appropriate by any method of telecommunication and, unless notice to the
contrary is given, shall be addressed to the party concerned at the following
address:
To SDTC:
Sustainable Development Technology Canada ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇ ▇▇▇ 5E4
Attention: Manager, Contracts
To Lead Contractor:
DynaMotive Energy Systems Corporation ▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, Manager of Project Development
18.2 Reports, notices, requests and documents arc deemed to have been received,
if sent by registered mail, when the postal receipt is acknowledged by the other
party; by facsimile or electronic mail, when transmitted and receipt is
confirmed; and by messenger or specialized courier agency when delivered
19 General Contract Provisions
19.1 Time is of the Essence. Time is of the essence of this Agreement.
19.2 Excusable Delays. The dates and times by which either party is required to
perform any obligation under this Agreement shall be postponed automatically to
the extent, for the period of time, and to the degree that the party is
prevented from so performing by circumstances beyond its reasonable control.
Said circumstances shall include acts of nature, strikes, lockouts, riots, acts
of war, epidemics, government regulations imposed after the fact, fire, power
failures, earthquakes or other disasters. A party seeking relief under this
Section shall, as promptly as possible under the circumstances, provide the
other party with written notice of the circumstances, and its anticipated scope
and time of postponement of its obligations.
19.3 Amendments. This Agreement may only be amended, modified or supplemented
by a written agreement signed by both of the parties.
19.4 Legal Relationship. Nothing contained herein shall create the relationship
of principal and agent, master and servant, settler and trustee, employer and
employee, partnership or joint venture between the parties and neither party
shall have any right to obligate or bind the other in any manner. The Lead
Contractor shall not, and shall ensure that the members of Consortium do not,
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make any representation that the Lead Contractor is an agent of SDTC nor make
any representation that could reasonable lead any member of the public to
believe that the Lead Contractor or any member of the Consortium is an agent of
SDTC.
19.5 Severability. If any provision of this Agreement is determined to be
invalid or unenforceable by an arbitrator or a court of competent jurisdiction
from which no further appeal lies or is taken, that provision shall be deemed to
be severed herefrom and the remaining provisions of this Agreement shall not be
affected thereby and shall remain valid and enforceable; provided that in the
event that any portion of this Agreement shall have been so determined to be or
become invalid or unenforceable, the parties shall negotiate in good faith such
changes to this Agreement as will best preserve for the parties the benefits and
obligations of such offending portion.
19.6 No Implied Waivers. Rights Cumulative. No failure on the part of the
parties to exercise and no delay in exercising any right, power, remedy or
privilege under this Agreement, or provided by statute or at law or in equity or
otherwise, including, but not limited to. the right or power to terminate this
Agreement, shall impair, prejudice or constitute a waiver of any such right,
power, remedy or privilege or be construed as a waiver of any breach of this
Agreement or as an acquiescence therein, nor shall any single or partial
exercise of any such right, power, remedy or privilege preclude any other or
further exercise thereof or the exercise of any other right, power, remedy or
privilege.
19.7 Further Assurances. Each of the parties covenants and agrees that it will
sign such further agreements, assurances, waivers and documents, and do and
perform or cause to be done and performed such further and other acts and things
as may be necessary or desirable from time to time in order to give full effect
to this Agreement and every part hereof.
19.8 Governing Law This Agreement shall be governed by, interpreted andconstrued
in accordance with the laws of the Province of Ontario and the federal laws
of Canada applicable therein. The courts of the Province of Ontario shall have
exclusive and original jurisdiction in any action or proceeding brought under
this Agreement or for the purpose of enforcing this Agreement or any provision
of it and the parties irrevocably attorn to the jurisdiction of the courts of
the province of Ontario. The clauses set out above combine to support the
proposition that notwithstanding the fact that an Eligible Recipient resided
in a jurisdiction outside Ontario, the Agreement is entered into in Ontario.
19.9 Entire Agreement. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all
previous negotiations, communications, and other agreements, whether written or
verbal, between the parties.
19.10 Successors and Assigns. This Agreement shall enure to the benefit of and
be binding on the parties and their respective successors and permitted assigns.
20. Limits on Funding
20.1 The preparation of this Agreement by SDTC and the completion of any blanks
herein shall not be construed as an offer by SDTC to the Lead Contractor. This
Agreement shall not be binding on SDTC until it has been executed by SDTC and
the Lead Contractor and a fully executed copy is delivered to the head office of
SDTC in Ottawa. Unless fully executed, this document shall expire on March 31,
2004. If this Funding Agreement is not fully executed by its expiration date
potential funding may be unilaterally withdrawn by SDTC.
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STDC-2002-B-448 CONFIDENTIAL
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IN WITNESS WHEREOF this Agreement has been executed by the parties hereto as of
the Effective Date.
Canada Foundation for Sustainable Development Technology
By: /s/▇▇▇▇ ▇▇▇▇▇▇
------------------------------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Vice Presideent, Operations
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Presideent & CEO
▇▇▇▇ ▇▇▇▇▇ BioOil Co-Generation Limited Partnership, by its
general partner, DynaMotive Canada Inc.
By: /S/ ▇▇▇▇▇▇▇ ▇▇▇
-------------------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇
Title: Chairman
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STDC-2002-B-448 CONFIDENTIAL
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Schedule A
----------
Work Plan and Statement of Project Objectives
Description of the technology:
BioOil Fuelled Cogeneration System
This Green Power development project will validate the individual and combined
capability of two Canadian leading edge renewable energy technologies.
DynaMotive is commercializing the patented BioTherm fast pyrolysis technology
for production of liquid fuels from low value forest and agricultural residues
(e.g. wood, bark, straw). This Canadian technology rapidly
heats biomass creating a gas stream that
is re-condensed into a clean burning liquid fuel. BioOil can be used
as a fossii fuel substitute in kilns, boilers, turbines and diesels engines
reducing Greenhouse Gas (GHG) emissions as biomass is considered CO2: neutral.
A granulated char co-product is also produced with no waste streams generated in
the process. The char can be used for BBQ briquette production or as a
substitute for coal for green power. Utilization of residual biomass in this
manner also reduces GHG emissions and Criteria Air Contaminants (CAC) associated
with disposal methods such as Methane from landfilling and stockpiling or
particulates from bee-hive burners.
The second technology is Orenda's 2.5 MW gas turbine (GT) developed specifically
for operation on BioOil. Recognizing the opportunity and demand for renewable
energy, Orenda has incorporated specific turbine blade coatings and engineered
new fuel handling and combustion systems allowing, the turbine to operate on
Blood.
Once integrated, the BioOiL/turbine system will produce green power displacing
▇▇▇▇▇ energy from the grid while generating GHG offsets. As well, the green
power delivered to the grid can be marketed at a premium in deregulated markets
like Alberta and Ontario by green power marketers such as project partner
Ontario Power Generation.
Objectives:
- The overall objective is to commercialize our renewable fuel energy
technologies allowing rapid deployment across Canada and internationally
reducing GHG emissions while simultaneously addressing residue disposal issues.
- Scale up and demonstrate the BioTherm fast pyrolysis technology at near
commercial scale. o Demonstrate green power generation based on a BioOil fuelled
gas turbine.
- Demonstrate the integrated power package.
- Refine and validate capital and operating cost projections to develop
"bankable" documents to assist project replication.
- Provide a marketing vehicle to show potential customers and facilitate the
education process, as customer knowledge of this technology is usually limited.
- Raise the environmental profile of the project partners.
Note: Char production is relatively low compared to that of BioOil therefore
this project is focused primarily on BioOil.
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
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Sustainable Development Focus:
The primary focus of the green energy technologies contemplated in this project
will result in reduced Greenhouse Gas (GHG) emissions. Secondary areas of
impact are the reduction of criteria air contaminants (CAC) and increased
industrial efficiency and resource utilization. This project will realize these
benefits immediately upon execution and over the long term by facilitating wide
spread deployment of the technologies.
Combusting sustainably produced biomass derived products is considered CO2
neutral as there is no overall change in the level of atmospheric carbon due to
the "carbon cycle". When biomass grows, the carbon from CO2 in the atmosphere
is captured in the structure of the plant. Subsequent combustion of that plant
will release the carbon back into the atmosphere as CO2, again available to
support plant growth hence repeating the cycle with no net effect. This is in
contrast to fossil fuel combustion where carbon is removed from underground and
released to the atmosphere with no significant return of carbon to the Earth to
maintain the balance.
BioOil can be burned in systems such as gas turbines, diesel engines,
boilers, kilns and furnaces displacing the fossil fuels
currently used. The emissions associated with the displaced fossil fuels are
avoided reducing the overall GHG output. In addition as a result of the unique
properties of BioOil, a number of CACs including SO2, and NO2, may also be
reduced. BioOil contains only trace amounts of sulphur resulting in negligible
SO2 emissions while turbine testing to date indicates a significant
(approximately 50%) reduction of NO2 when compared to fossii fuels.
BioOil production from residual biomass also reduces the emissions associated
with current disposal methods. Every year millions of tonnes of biomass residues
are disposed of in landfills or else combusted inefficiently with limited energy
recovery. Methane (CH4) is emitted during natural decomposition of biomass in
landfills and to a lesser degree by incomplete combustion during incineration.
Significant GHG emissions result as the greenhouse effect attributed to methane
is 21 times that of CO2 In addition, BioOil ▇▇▇▇▇ cleanly so converting the
biomass into BioOil for combustion dramatically reduces the high particulate
emissions associated with inefficient biomass burning.
A further benefit to sustainability is the increased efficiency of existing
industrial activities that will be realized by deployment of the BioTherm
technology. Converting residual biomass into green fuels and
electricity will also reduce other high costs associated
with current biomass disposal methods (i.e. infrastructure,
transportation, compliance, remediation, etc.) while leveraging an underutilized
resource by creating products and recovering energy currently squandered.
Conversion of biomass into BioOil, which is more easily transported than raw
biomass, may open opportunities for exploiting iomass sources that are otherwise
not economic to recover.
Primary areas of application of DynaMotive and Orenda technologies are:
* Renewable Energy Production
- Green renewable biomass based liquid fuels from DynaMotive process.
- Green electricity and heat from bio-fuelled Orenda gas turbine.
* Waste Management
- Value added disposal option for biomass residuals.
- Reduced methane emissions through alternate disposal methods
(i.e. BioOil production).
Secondary application areas for the technologies are:
* Energy Utilization
- Self-generation and co-generation options for industry.
- District heating systems based on DynaMotive and/or Orenda technologies.
- Exploitation of biomass sources that were previously un-economic.
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
25
* Energy Transmission and Distribution
- Reduced transmission losses due to localized I distributed power generation.
* Transportation (long term objective)
- Renewable transportation fuels based on BioOil blends, emulsions and
synthetic fuels.
Economic Sectors Impacted:
The green energy technologies in this project will eventually impact all
economic sectors directly and/or indirectly. The following illustrates the
sector and associated impacts:
* Forest Industry/Wood Product Manufacturers
- GHG and CAC emissions reduced by diverting residues to BioOil production.
- Residue disposal costs reduced, avoided as diverted to BioOil production.
- Exposure to energy pricing risk reduced as BioOil based heat and power not
driven by fossil fuel volatility.
- Environmental profile enhanced due to green profile of the technologies.
- Forest communities strengthened by increased industrial and economic
activity.
- Utilization of biomass resource increased as value created from a waste
stream.
* Residential/Commercial
- Green power available from green energy marketers such as OPG.
- Energy costs reduced via self-generation or local co-generation.
* Agriculture (medium term: development to follow deployment in the forest
sector)
- Better utilization of low/negative value agricultural residues such as
straw, oat hulls and corn ▇▇▇▇▇▇
- Agricultural communities strengthened by additional industrial and economic
activity
* Transportation (long term: requires further development)
- GHG emissions reduced through BioOil based fuel blends and emulsions.
- Synthetic fuels (e.g. bio-methanol) derived from BioOil for fuel cells.
Technological Feasibility:
DynaMotive
Since 1997, DynaMotive has intensively focused on development and
commercialization of the BioTherm fast pyrolysis process for production of clean
burning renewable BioOil. The fundamental research completed at bench scale by
Resource Transforms International has been scaled up and validated by DynaMotive
through a series of developmental stages with the key milestones illustrated
below.
Key technology development timelines and milestones completed:
1994 /97: Bench scale development of BioTherm process (at RTI)
1997: DynaMotive licenses technology from original inventors, RTI
1997 /98: DynaMotive design/build 500 kg/d batch mode prototype plant
(BioTherm I )
1998: Upgrade BioTherm l to 2000 kg/d, continuous mode operation
1999: Third party technology validation (Stone and ▇▇▇▇▇▇▇)
2000/01: DynaMotive design build 10 tpd industrial pilot plant (BioTherm 2)
2001: Third party validation of technology (TECNA & SGS)
2001: DynaMotive acquires technology from RTI (patent purchase)
2001: BioOil characterization completed
2002: Increase BioTherm 2 capacity 50% (from 10 to 15 tpd)
2002: BioOil validated as fuel for natural gas replacement in lumber dry kilns
2003: BioOil validated as fuel for natural gas replacement in pilot scale lime
kilns
Not yet completed:
2003/04: Construct 100 tpd BioOil production facility.
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
26
The next stage of BioTherm development is to scale the technology to 100 tpd
capacity. This scale is expected to be commercial in some niche opportunities
and the 100 tpd reactor is expected to become the standard modular building
block of larger full scale plants. Commercial plants in the range of 200 to 400
tpd may be constructed using multiple 100 tpd reactors in combination with
common ancillaries.
The most significant technological challenge at this time is scaling the reactor
from 15 to 100 tpd capacity. Based on our pilot plant operating experience and
the predictability and repeatability of process parameters from bench scale
through to 15 tpd, we are confident that this scale step is readily achievable.
In addition, we are working with a world-class fluidized bed design company with
the expertise and experience to engineer our design.
Orenda
Since 1999, Orenda has been working closely with DynaMotive BioOil to develop a
gas turbine suitable for industrial deployment.
Key technology development timelines and milestones completed:
1999: Fundamental BioOil combustion testing complete
2000: Full scale combustion testing completed in the Ukraine
2000: Hot corrosion resistant coatings developed
2000: BioOil specific turbine wash system developed
2001: BioOil fuel handling and injection system developed
Not yet completed:
2002/ 03: BioOil fuelled GT2500 construction complete
2003: Full capacity turbine testing on BioOil
The key technical challenge faced by Orenda is determining the operating and
maintenance regime tier the GT2500. Without the actual operating
experience, Orenda cannot offer industrial customers the performance guarantees
they require to commit to the technology thus limiting the market opportunity
for the integrated green power system.
Patents and Intellectual Property:
DynaMotive's BioTherm technology is patented in various jurisdictions around the
world. The priority filing patent is the US Patent a 5853548 "Energy Efficient
Liquefaction of Biomaterials by Thermolysis", which is attached as Appendix C to
the proposal for reference.
DynaMotive and Orenda have an MOU in place that identifies clearly how
each others intellectual property (IP) is managed in the
relationship. In general, regardless of who originated the concept or idea, if
it pertains to pyrolysis, it is DynaMotive's technology and if it is turbine
related it is Orenda's. A mechanism is in place that should any IP arise that is
clearly not one or the other parties, it will be joint property owned 50/50
between the partners and its treatment and exploitation subject to negotiation
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
27
Work Plan
GRAPHIC OMITTED
Major milestones and associated eligible costs
----------------------------------------------
Eligible SDTC SDTC
Milestone Date Expenditure Expenditure Contribution Holdback
------------------------------------------------------------------------------------------------------------
1. Project Start 6/16/03 $3,043,153 $3,043,153 $ - $ -
2. Construction 2/23/03 $3.019,035 $2,685,035 $2,250,000 $250,000
3. Complete Commissioning 4/1/04 $7,062,812 $6,309,812 $2,250,000 $250,001
4. WorkPlan Complete 6/30/04 -- -- $500,000 $(500,000)
(Holdback) --------------------------------------------------------------
Total $13,125,000 $12,038,000 $5,000,000
===============================================
Note:
The major activities to be completed under each of the above milestones is as
follows:
1. Project start: Finalization of contracts and other legal agreements; Detailed
Feasibility Study; Detailed engineering completed; Turbine Ordered; Pyrolysis
and all other equipment items ordered.
2. Construction started on turbine and reactor foundations; Fabrication of
Reactor skids completed: shipment of turbine and reactor skids.
3. Complete balance of plant, mechanical completion; Commissioning; Operations
study.
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
28
Contributions to the Project
----------------------------
Funding Breakdown:
Confirmed Unconfirmed Confirmed Unconfirmed
Consortium Member Cash Cash In-kind In-kind Total
--------------------------------------------------------------------------------------------------------------
Dynamotive 3,981,000 299,000 4,280,000
Magellan/Orenda 1,000 3,644,000 3,645,000
OPG 200,000 200,000
Other Contributors
------------------------------------------------------------------------------
Subtotal 4,182,000 3,943,000 8,125,000
------------------------------------------------------------------------------
SDTC Funds $5,000,000 $5,000,000
Total Project Funding: $13,125,000
===========
i) Total Cost of Project: $13,125,000
ii) Funding Amount Requested from SDTC: $5,000,000
iii) % of SDTC Funding to Total Cost of
Project: 38%
Iv) Total non-SDTC cash into Project: $4,182,000
v) % of non-SDTC cash to Total Cost of
Project: 32%
vi) % of Cash to In-kind Contribution: 235%
vii) % of Government Funding to Total Cost of
Project: 38%
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
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Budgetary Control
---------------------------------------------------------
Eqpt Committed Uncommitted Forecast
No. Description Budget Costs Costs Budget
C$ C$ C$ C$
---------------------------------------------------------------------------------------------------
(A) Estimated Engineering & Construction Costs
01 Feed Preparation 547,000 293,794 118,000 411,794
02 Feed Transport 108,000 91,580 23,000 114,580
03 Feed System 489,000 267,169 105,749 372,918
04 Reactor 783,000 309,452 316,281 625,733
05 Combustion 60,000 452,076 26,200 478,276
06 Char System 529,000 305,091 74,692 379,782
07 BioOil Separation 746,000 424,487 291,167 715,654
08 Recycle Gas System 210,000 193,919 0 193,919
09 BioOil Storage 97,000 70,267 81,414 151,681
10 Cooling Water 197,000 64,419 50,000 114,419
11 Power Island 3,965,000 3,854,212 433,000 4,287,212
12 HRSG 399,000 245,500 109,000 354,500
13 Electrical Equipment and
Instrumentation 1,404,000 502,501 1,038,496 1,540,997
14 Spark/Fire Protection 130,000 0 140,000 140,000
15 Site & Services 45,000 6,694 40,000 46,694
16 Building and Structures 71,000 0 312,000 312,000
17 Concrete & Foundations & Slabs 339,000 0 239,000 239,000
18 Project Management,
Engineering & Office 1,065,000 643,099 410,351 1,053,450
19 N2 Generation 55,000 0 55,000 55,000
20 Miscellaneous 365,000 274 345,726 346,000
---------------------------------------------------------
Total Estimated Costs before 11,604,000 7,724,533 4,209,075 11,933,608
Contingency
Contingency 943,170 0 383,950 383,950
---------------------------------------------------------
Total Estimated Engineering &
Construction Costs 12,547,170 7,724,533 4,593,025 12,317,558
=========================================================
(B) Other Costs
OT-100 Spares 0 0 40,000 40,000
0T-110 Land Costs 0 0 0 0
OT-120 Financing Costs 0 0 0 0
OT-130 Noise & Environmental 0 0 50,000 50,000
Start-up, training and comissioning 100,000 100,000
---------------------------------------------------------
Total Estimated Other Costs 0 0 190,000 190,000
---------------------------------------------------------
Total Costs - Project Specific $12,547,170 7,724,533 4,783,025 12,507,588
=========================================================
(C) Developmental Engineering after June 1, 2003
▇▇▇▇▇▇ - Engineering & Final Design 0 347,048 0 347,048
Study
UMA Feasibility Study 0 146,753 0 146,753
Legal tax and other professional 75,000 50,000 125,000
----------------------------------------------------------
Total Estimated Other Costs 0 568,801 50,000 618,801
----------------------------------------------------------
Total Costs - Specific & Non-Specific 12,547,170 8,293,335 4,833,025 13,126,359
----------------------------------------------------------
Estimate to Completion 13,126,359
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
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Project Budget
--------------
AREA DESCRIPTION MATERIAL COST INSTALLATION TOTAL
01 Feed Preparation $293,794 $118,000 $411,794
02 Feed Transport $101,580 $13,000 $114,580
03 Feed System $357,918 $15,000 $372,918
04 Reactor $425,733 $200,000 $625,733
05 Combustion $478,276 $ - $478,276
06 Char System $341,782 $38,000 $379,782
07 BioOil Separation $430,654 $285,000 $715,654
08 Recycle Gas System $193,919 $ - $193,919
09 BioOil Storage $115,681 $35,000 $151,681
10 Cooling Water $94,419 $20,000 $114,419
11 Power Island $4,090,212 $197,000 $4,287,212
12 HRSG $354,500 $ - $354,500
13 Electrical Eqmt. & Instrumentation $1,192,997 $348,000 $1,540,997
14 Spark Fire Protection $75,000 $65,000 $140,000
15 Site & Service $10,000 $36,694 $46,694
16 Building & Structures $252,000 $60,000 $312,000
17 Concrete & Foundations & Slabs $71,000 $168,000 $239,000
18 Project Management,
Engineering & Site Office $ - $1,547,251 $1,547,251
19 N2 Generation $45,000 $10,000 $55,000
20 Miscellaneous $207,000 $454,000 $661,000
-------------------------------------------------------------
Sub Total $9,132,464 $3,609,945 12,742,409
PST - on equipment and material
To be exempt $ $ $ -
Contingency $ $ $ 382,591
TOTAL (Accuracy + or 5%) $13,125,000
-------------------------------------------------------------------------------------------------------------
Not included:
GST (not applicable)
Land Costs (operating lease)
Host Project Management Costs
Financing Costs
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
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Schedule C
Deliverables and Milestones
Delivery no. Project Deliverable Delivery Date SDTC Contribution
0001 Initial Contribution Payment Feb 28, 2004 $1,900,000.00
Milestone: Successful Completion of:
- Engineering/Design
- Plant Layout, GA's Evaluations
0001A Project Status Report
Report on Project status including anticipated project achievements, failures,
risks, actual or potential schedule delays, number and description of patent
applications, economic market analysis and other relevant project issues,
Provide verifiable documents as evidence of project achievements. Report must be
signed by a minimum of two consortium members.
0001B Sustainable Development Impacts Reporting System (SDIRS) Report
- Complete Benchmarks including all inputs and outputs (see Schedule E for SDIRS
details)
0001C Project Financial Certification Report (PFCR) (see Schedule E for PFCR
details)
0001D Project Impacts Report (as a direct result of SDTC support)
1) Technology Impacts
a) Describe the long term goals for the technology, its application and
any potential application, its efficiency increases and impacts
and its forecasted impacts on emissions reduction.
2) Partnerships
a) Project organizational (Org.) chart
b) Statement of any changes to consortium
3) Economic Impacts
a) Report on current economic activity by region and by product category
- Subsequent financing
- Company infrastructure growth
- Investment
4) Commercialization Development
a) Report on new licensing of the technology (manufacturing and any
other licenses) by region and by product category.
b) Report on new distributor and dealer agreements signed by region and
by product category.
c) Report on competition, market trends and market intelligence
5) Research and Development Reporting
a) Report on new technologies under development
b) Report on new patents applied for and new patents issued
c) Report on all new Intellectual Property creation
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
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0001E Corporate Reports
1) Corporate Financial Statements
a) Balance sheet
b) Profit and loss statement
c) Cash flow statement
0002 Contribution Payment 2 May 31, 2004 $1,217,363.00
Milestone: Successful Completion of:
- Permits, Licenses and Site Issues
- Fabrication and Delivery
- Site Work and Installation
0002A Project Status Report
Full report on Phase I of project including successful completion of all
detailed engineering and technical studies (results of technical and economic
evaluation, feedstock analysis and trials, site analysis and integration
requirements studies).
Report on Project status including anticipated project achievements, failures,
risks, actual or potential schedule delays, number and
description of patent applications, economic market analysis and other relevant
project issues. Provide verifiable documents as evidence of project
achievements. Report must be signed by a minimum of two consortium members.
0002B Sustainable Development Impacts Reporting System (SDIRS) Report
- Complete Benchmarks including all inputs and outputs (see Schedule E for SDIRS
details)
0002C Project Financial Certification Report (PFC.) (see Schedule E for PFC.
details)
0002D Project Impacts Report (as a direct result of SDTC support)
1) Technology Impacts
a) Describe the long term goals for the technology, its application and any
potential application, its efficiency increases and impacts and its
forecasted impacts on emissions reduction.
2) Partnerships
a) Project organizational (Org.) chart
b) Statement of any changes to consortium
3) Economic Impacts
a) Report on current economic activity by region and by product category -
Subsequent financing Company Infrastructure growth - Investment
4) Commercialization Development
a) Report on new licensing of the technology (manufacturing and any other
licenses) by region and by product category.
b) Report on new distributor and dealer agreements signed by region and by
product category.
c) Report on competition, market trends and market intelligence
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STDC-2002-B-448 CONFIDENTIAL
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5) Research and Development Reporting
a) Report on new technologies under development
b) Report on new patents applied for and new patents issued
c) Report on all new Intellectual Property creation
0002E Corporate Reports
1) Corporate Financial Statements
a) Balance sheet
b) Profit and loss statement
c) Cash flow statement
0003 Final Project Report Jun 30, 2004 $1,882,637.00
Signed by all members of the Consortium
Milestone: Successful Completion of:
- Commissioning and Training
- Production Ramp-up
0003A Project Completion Report
1) All project achievements and/or project failures
2) Verifiable documents as evidence of project achievements
3) Any other relevant project issues
4) A narrative about your experience with SDTC and how we have helped
you achieve your goals
0003B Marketing and Commercialization Report
1) Updated Business plan with a Tactical Marketing Plan describing the
post-demonstration activities for commercialization and marketing of the
technology, by product category, including:
a) product cost and pricing information including margin stack
b) a competitive analysis of the market including both prime and
indirect competitors
c) forecasted market uptake rates
d) and the forecasted size of the market for the technology by product
category
2) Any changes from the original marketing plan provided in the project
proposal.
3) Any future risks or barriers to the full commercialization of the
technology
4) Any potential or actual delays to commercializing and/or marketing
the technology
0003C Sustainable Development Impacts Reporting System (SDIRS) Report (see
Schedule E for SDIRS details)
0003D Project Financial Certification Report (PFCR)
(see Schedule E for PFCR details)
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
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0003E Project Impacts Report (as a direct result of SDTC support)
1) Technology impacts
a) Describe any updates to the long term goals for the technology, its
application and any potential application, its efficiency increases
and impacts its; forecasted impacts on emissions reduction.
2) Partnerships
a) Statement of any changes to consortium
3) Economic Impacts
a) Report on current economic activity by region and by product
category
- Subsequent financing
- Company infrastructure growth
- Investment
4) Commercialization Development
a) Report on new licensing of the technology (manufacturing and any
other licenses) by region and by product category.
b) Report on new distributor and dealer agreements signed by region
and by product category.
c) Report on competition, market trends and market intelligence
5) Research and Development Reporting
a) Report on new technologies under development
b) Report on new patents applied for and new patents issued
c) Report on all new Intellectual Property creation
6) Other Participation
a) Report on other Loans or Grants secured for subsequent rounds of
financing
b) Report on Partnership Creation including number of new partnerships
created
0003F Corporate Reports
1) Corporate Financial Statements
a) Balance sheet
b) Profit and loss statement
c) Cash flow statement
0004A Final Project Audit July 31, 2004 Payment of 10%
Holdback
0005 Annual Project SDIRS Reports
(See Schedule E for SDIRS details)
0005A First Annual Project SDIRS Jun 30, 2005
0005B Second Annual Project SDIRS Jun 30, 2006
0005C Third Annual Project SDIRS Jun 30, 2007
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
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Schedule D
----------
Consortium Members
Lead Contractor:
DynaMotive Energy Systems Corporation
▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Contact Person : ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title : Manager of Project Development
Telephone : (▇▇▇)▇▇▇-▇▇▇▇
Fax: (▇▇▇)▇▇▇-▇▇▇▇
E-mail : ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
Partner 2:
Orenda division of Magellan Aerospace Corporation.
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
Contact Person: ▇▇▇▇▇ Button
Title: General Manager, Orenda Turbines
Telephone; (905)673-3250 ext. 3445
Fax: (▇▇▇)▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
Partner 3:
Erie Flooring and Wood Products
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
Contact Person: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: General Manager
Telephone: (▇▇▇)▇▇▇-▇▇▇▇ ▇▇▇, 30
Fax: (▇▇▇)▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
Partner 4:
Ontario Power Generation Inc. (OPG)
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
Contact Person: ▇▇▇▇▇ ▇▇▇▇▇
Title: Senior Business Development Engineer
Telephone: (▇▇▇)▇▇▇-▇▇▇▇
Fax: (▇▇▇)▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇.▇▇▇▇▇@▇▇▇.▇▇▇
Partner 5:
UMA Engineering Ltd.
Vancouver, BC, Canada
Contact Person: ▇▇▇▇▇ ▇▇▇▇▇
Title: Senior Vice President
Telephone: (▇▇▇)▇▇▇-▇▇▇▇
Fax: (▇▇▇)▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
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Schedule E
----------
Reports
Corporate Reports:
(Refer to schedule C for detailed requirements).
Project Status Report:
(Refer to schedule C for detailed requirements).
Project Completion Report:
(Refer to schedule C for detailed requirements).
Project Financial Certification Report (PFCR):
Budgeted costs vs. Actual expenditures to date.
Provide copies of all invoices over $1,000.00
(See Excel Spreadsheet provided by SDTC for report format)
Sustainable Development Impacts Reporting System (SDIRS):
(Electronic copy provided by SDTC)
--------------------------------------------------------------------------------
STDC-2002-B-448 CONFIDENTIAL
