10-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

FOR ANNUAL AND TRANSITION REPORTS
PURSUANT TO SECTIONS 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2007

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 000-28025

GLOBAL ENERGY INC.
(Exact Name of Registrant as Specified in its Charter)

Nevada	86-0951473
(State or Other Jurisdiction of	(IRS Employer
Incorporation or Organization)	Identification No.)
415 Madison Avenue, 15th Floor,	10017
New York, NY	(Zip Code)
(Address of Principal Executive Offices)

+1 (646) 673-8435
(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.001 par value

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act: Yes [   ]   No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act: Yes [   ]   No [X]

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for the past 90 days: Yes [X]   No [   ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated
by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a
smaller reporting company:

Large accelerated filer [   ]      Accelerated filer [   ]     
Non-accelerated filer   [   ]      Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):
Yes [   ]   No [X]

The aggregate market value of the common stock held by non-affiliates of the registrant as of June 29, 2007, the last
business day of the registrant’s most recently completed second fiscal quarter, was approximately $42 million (based
on the average bid and asked price for the registrant’s common stock on June 29, 2007 on the OTC Bulletin Board of
$2.00 per share).

At March 14, 2008, 63,187,764 shares of the registrant’s common stock were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE: None

TABLE OF CONTENTS

PART I		1
Item 1.	Business	1
Item 1A.	Risk Factors	6
Item 1B.	Unresolved Staff Comments	12
Item 2.	Properties	12
Item 3.	Legal Proceedings	13
Item 4.	Submission of Matters to a Vote of Security Holders	13
PART II		13
Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuers Purchases of Equity Securities	13
Item 6.	Selected Consolidated Financial Data	14
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	19
Item 8.	Financial Statements and Supplementary Data	19
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	20
Item 9A(T).	Controls and Procedures	20
Item 9B.	Other Information	20
PART III		21
Item 10.	Directors, Executive Officers and Corporate Governance	21
Item 11.	Executive Compensation	23
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	25
Item 13.	Certain Relationships and Related Transactions, and Director Independence	26
Item 14.	Principal Accountant Fees and Services	27
PART IV		27
Item 15.	Exhibits and Financial Statements	27
SIGNATURES		28
EXHIBIT INDEX		29

PART I

Item 1. Business

            Certain statements in this Annual Report on Form 10-K are “forward-looking statements”. These statements involve a number of risks, uncertainties and other factors that could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Factors which could materially affect such forward-looking statements can be found in the section entitled “Risk Factors” in Item 1A.of this Annual Report on Form 10-K. Investors are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are only made as of the date hereof and we will undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

           References in this Annual Report on Form 10-K to “Global Energy,” the “Company,” “we,” “us” or “our” are to Global Energy Inc., a Nevada corporation, and its subsidiaries.

Corporate Overview

           Our company was organized on February 16, 1999, under the laws of the State of Nevada as Global Smartcards Inc. On April 28, 2003, we changed our name to Global Energy Inc. Our business address is 415 Madison Avenue, 15th Floor, New York, New York. Our telephone number is +1 (646) 673-8435. Our registered agent is Rite, Inc., 1905 South Eastern Ave., Las Vegas, NV 89104.

           Effective July 1, 2005, we sold all of our oil and gas assets for the sum of $50,000. The sale of these oil and gas assets was completed on July 6, 2005.

Our Current Business

           Our mission is to produce and supply alternative fuels, based on alternative energy producing technologies, which utilize renewable sources for creating viable energy sources while contributing to severe environmental conservation issues.

           Our strategy is to operate a growing number of owned industrial scale production facilities in several international locations and emerge as a leading supplier of mineral diesel, selling to industrial and governmental customers on every level of the supply chain.

           On May 2, 2007, we entered into a letter of intent with AlphaKat, pursuant to which we agreed, subject to certain conditions, to purchase the AlphaKat’s KDV 500 turbine technology and assist with the marketing and development of the technology. In connection with the development of the KDV technology and the construction of the plants, we agreed to: (i) provide financial support for the project, (ii) create a joint venture company for the marketing and development of the technology; (iii) purchase three KDV 500 turbines for implementation in Poland, the United States and Israel; (iv) start a regulatory process, including filing of permit applications at a cost of Euro €100,000; commence monthly payments of Euro €10,000 to Dr. Christian Koch, the owner of AlphaKat, after due diligence on the KDV 500 turbine is completed; and (v) enter into a definitive agreement for the KDV 500 turbine. We are currently working on receiving permits in the United States and Israel, while in Poland and Germany we achieved basic permits from the authorities for the implementation of the KDV 500 turbine. As of the date of this report, we have not ordered any of the KDV 500 turbines other than placing an advanced payment for one unit.

           In May, 2007, we established two subsidiaries in Israel: Global Fuel Israel Ltd., or Fuel, and Global N.R.G. Pacific Ltd., or Pacific. Fuel will render services to us, however the nature and the scope of the services is not yet defined.

           On July 9, 2007, we entered into a shareholder agreement to form a joint venture with Yanai Man Projects Ltd., or Yanai, pursuant to which we hold 50.1% of Pacific and Yanai holds 49.9% of Pacific. Pacific's purpose is the procurement of agricultural knowledge and the growth of vegetation for the purpose of producing crude castor oil to aid in the process of manufacturing bio-diesel fuel. The first project is to work with an Ethiopian entity to farm castor seeds for castor oil in Ethiopia.

           On July 10, 2007, we entered into an agreement with AlphaKat based on the letter of intent executed by the parties on May 2, 2007, to produce mineral diesel from municipality solid waste using the KDV process, originally developed by AlphaKat and its owner Dr. Christian Koch, over a 30 year period. The process is applicable to biomass waste and any waste containing organic materials (hydrocarbons), including plastic, textile, rubber, leather, wood, paper, animal and agriculture waste. The KDV depolymerization technology is an alternative-energy source. It provides a patent-protected solution for the simultaneous creation of clean energy and the disposal of waste. The process uses a high speed turbine and a proprietary catalyst to convert and distillate waste into diesel oil. The result is a sulphate free diesel oil that meets the requirements of the EN590 standard for diesel oil and is intended for use in trucks and heavy equipment, as well as by major petroleum companies.

1

           Pursuant to the agreement with AlphaKat, we incorporated and operate a company named AlphaKat-Global Energy GmbH. We and AlphaKat each hold 50% of the shares of AGEI. The goal of AGEI is to provide worldwide marketing and sales of technology which converts hydrocarbon waste into diesel oil. AGEI has the exclusive rights to sell certain technology of Alphakat in the United States and China and has non-exclusive rights for certain other parts of the world.

           On October 5, 2007, our majority owned subsidiary, Global Energy Ethiopia PLC, or Global Ethiopia, entered into lease agreements with the Southern Nations Nationalities People's Regional State, Ethiopia, or SNRS, for a 50 year lease of 20,000 hectares of rural land located in the Gamo Gofa zone in the SNRS for the purpose of cultivating castor seeds and 15 hectares of land located in the Gamu Gofa zone, Kucha Woreda, in the SNRS for the purpose of operating an oil crushing plant through an existing facility on the property.

           On October 20, 2007, we entered into an agreement for consulting services with Trianon Partners, or Trianon, and as of October 24, 2007, we entered into a joint development agreement with Trianon. In consideration of the consulting services to be provided by Trianon, we agreed to pay Trianon a fixed fee of $250,000 which was to be paid in equal monthly installments of $10,000 once we decided to commence the construction of the plant, with the balance to be paid upon mechanical completion of the plant. The agreement for consulting services was terminated by mutual consent on February 6, 2008. In consideration of the joint development agreement, we agreed to grant an exclusive license to Trianon, throughout the States of Texas, New York and New Jersey to be formed with AlphaKat, to market systems that use a proprietary bio-diesel technology for the conversion of waste to bio-diesel.

           On February 6, 2008, we entered into a business and royalty agreement with Covanta Energy Corporation, under which we granted to Covanta certain rights, both exclusive and non-exclusive, for the use, practice, and improvement of the KDV technology for the purpose of converting waste materials containing hydrocarbons into diesel oil in countries including the US, the UK, China and the Republic of Ireland. We did so in exchange for the retention by us of certain rights to pursue specified small scale projects using the technology, which Covanta will have the option to invest in, as well as our retention of the right to invest 10% - 35% of the equity in projects initiated by Covanta. Covanta agreed to pay us a royalty equal to 10% of the gross revenues derived from the sale of diesel oil from each project for a period of 20 years from the date the applicable project achieves commercial operation. Under the agreement, Covanta shall also be responsible for financing 100% of the costs of erection of a demonstration plant, which it may disassemble and make available for pick up by us, at no cost to us, upon Covanta terminating its rights to the technology.

           On the same day, we entered into a license agreement with Covanta under which we granted it a right to sell systems based on the technology to governmental organizations subject to certain pre-conditions regarding the purchase of a minimum number of systems based on the technology. Covanta's rights under both the license agreement and the business and royalty agreement shall be non-exclusive until it has (i) issued a purchase order for a demonstration plant, and (ii) placed purchase orders for five additional systems. AlphaKat-Global Energy GmbH will receive a 10% commission from the sale of all systems, part of which shall be payable to American Renewable Diesel, LLC, subject to the business and development agreement described below.

           On February 6, 2008, we executed a business and development agreement with Renewable Diesel, LLC, an affiliate of Trianon Partners and of American Renewable Diesel, LLC, under which both Renewable and our company shall have the right to identify and develop certain projects to convert feedstock to diesel using the KDV technology in New York, California and Texas, as well as Florida and New Jersey under certain conditions. If we identify a project, Renewable shall be entitled to invest up to 25% of the total required equity. If Renewable identifies a project, we shall be entitled to invest up to 51% and Covanta will be entitled to invest up to 24% of the total required equity. In all projects, Renewable shall manage the projects and shall be entitled to development fees in the amount of $100,000, up to a total of $2,000,000, for each KDV 500 system included in the project.

           In connection with the business and development agreement described above, AlphaKat-Global Energy GmbH executed a license agreement with American Renewable Diesel, LLC, an affiliate of Trianon Partners and of Renewable, which granted American certain exclusive rights to market and sell systems based on the technology in the territory of California, New York and Texas, as well as New Jersey and Florida, subject to the satisfaction of minimum sales requirements. The territory may be reduced and/or exclusive rights may become non-exclusive rights, depending on whether minimum sale requirements are satisfied. American is to receive a commission on all sales in the territory. Systems sold to Covanta shall be credited to American, regardless of whether such systems are for use inside or outside the territory.

           In March 2008 we entered into a Memorandum of Understand with ShenMu SanJiang Coal Chemical Company Ltd. (“Shaanxi”) located in the People’s Republic of China. Under the terms of the MOU, we and Shaanxi, pending completion of due diligence of the KDV technology in Germany, plan to jointly own a new entity. We would own 51% of the new entity, unless Sinopec Beijing Governmental Energy Company becomes a substantial equity partner, in which case our interest would be 26%. The new entity would initially build, own and operate an AlphaKat system expected to produce ten thousand (10,000) liters of diesel per hour from tar oil. Shaanxi is a producer of blue coal, where significant quantities of tar oil are produced as a residual of the production process.

2

Shaanxi would provide the new company with tar oil at a discount to the published market price for conversion into high quality diesel. The MOU provides for the extension and growth capabilities of the “system” after successful conversion of tar oil to diesel. We would be entitled, under the terms of the MOU, to royalties from the sale of diesel produced by the AlphaKat KDV Technology. Completion of the transaction is subject to due diligence and negotiation of final documentation.

Private Placement in 2007

           On July 6, 2007, we entered into a securities purchase agreement with YA Global Investments, L.P. (formerly Cornell Capital Partners, L.P.). Pursuant to the agreement, as amended on March 20, 2008, we agreed to sell and issue up to $4,000,000 of secured debentures convertible into shares of our common stock. As of the date of this annual report, we have issued $3,500,000 of secured convertible debentures, warrants to acquire up to 600,000 additional shares of common stock at a price per share of $1.25. The exercise price and the number of shares issuable upon exercise of the warrants and the conversion price and the number of shares issuable upon conversion of the secured convertible debentures are subject to anti-dilution adjustments and customary adjustments in the event of distributions, reorganizations or fundamental transactions. Additional funds will be advanced to us by YS Global under the securities purchase agreement upon the registration statement, registering the resale of the shares under the debentures, being declared effective.

           The 10% secured convertible debentures, which mature on October 31, 2010, are convertible by the debenture holder into shares of common stock at a fixed conversion price of $1.25 per share, as may be adjusted. The debentures are secured against all of our assets.

           Amortizing payments of the outstanding principal amount of the debentures will commence on the first business day on or after July 31, 2008, and will continue on the first business day of each successive calendar month thereafter until the principal amount has been repaid in full. Assuming the issuance of $4,000,000 of debentures, we will be required, commencing on the first business day on or after July 31, 2008, to pay the holder of the debentures the principal amount of $300,000 every month until the principal amount has been repaid in full. In addition, payments of accrued interest will commence on the first business day on or after July 31, 2008, and will continue on the first business day of each successive quarter. These payments may be made at our option by cash or by the issuance of our common stock at the lower of (i) $1.25, as may be adjusted, or (ii) 95% of the lowest volume weighted average trading price per share of our common stock during the fifteen (15) consecutive trading days immediately preceding the conversion date, as quoted on the OTCBB.

           There are limitations on the number of shares that can be issued by us in payment of principal and interest that are tied to the volume of common stock traded on our principal trading market. If we fail to deliver stock certificates upon the conversion of these debentures at the specified time and in the specified manner, we will be required to make substantial payments to the holders of the debentures.

           Holders of the debentures may require that we redeem any or all of the outstanding debentures upon the occurrence of any one or more events of default specified in the debentures.

           The warrants are exercisable at any time until their expiration date. Holders of the warrants are entitled to exercise their warrants on a cashless basis following the first anniversary of issuance if the registration statement of which this prospectus is a part is not in effect at the time of exercise. Holders of debentures are subject to certain limitations on their rights to convert the debentures. The principal limitation is that the holder may not convert into a number of shares that would, together with other shares held by the holder, exceed 4.99% of the then outstanding shares of our common stock after such conversion, unless such limitation is waived by the holder upon not less than 65 days prior notice. The exercise of the warrants is subject to a similar limitation.

           If we fail to deliver stock upon a conversion and YA Global Investments, L.P. purchases stock to satisfy a sale by YA Global of common stock issuable upon such conversion that YA Global anticipated receiving from us, we can be liable, at YA Global’s option, for either (i) the total cost of the stock it purchased, including brokerage costs or other out of pocket expenses, if any, or (ii) to deliver share certificates representing the common stock and pay the excess of YA Global’s costs for the shares over the product of such number of shares of common stock times the price per share in the last reported trade of the common stock on the OTCBB on the conversion date.

Description of the KDV Technology

           The KDV process utilizes proprietary technologies developed by a German company, Alphakat, and its owner Dr. Christian Koch, a scientist who has spent over 30 years in senior positions at Siemens.

           The KDV process can be applied to municipal solid waste including plastic, rubber, paper and cardboard waste, all of which can be converted to mineral diesel.

            In addition, the technology can be applied to:

• Refinery residuals - such as petcock, tar and paraffin which cannot be used today and the disposal of which harms the environment and is very expensive to neutralize;

3

• Used oil from engines, organic wastes, sewerage sludge and animal manures;

• All types of waste biomass, including such items as the body plant of the corn when extracting oil from the seeds, sunflowers and any other crop where significant amounts of biomass remain in the field after harvesting the food parts; and

• Glycerine – bio-diesel plants produce glycerin, 30% of which can be converted to saleable mineral diesel.

• The product is a high-quality diesel fuel suitable for use in any of today's engines. It has Cetane of over 60, as compared to normal diesel oil (52) and super diesel (56), giving the engine greater power and a quieter operation.

• As a mineral, the diesel does not require certification from car and engine manufacturers, provided it fulfills European Union standards. The KDV process produces a renewable diesel and therefore is eligible for tax benefits in certain countries.

Manufacturing

           Currently, we do not own any diesel production facilities. While we are exploring possible acquisitions of suitable facilities for such purposes, we have not yet entered into any definitive agreement for a facility.

           Acquisition or construction of plant facilities may take several forms, including the leasing of plant facilities, joint ventures with third parties, including manufacturers of ethanol and bio-diesel or consumers of bio-diesel such as trucking and transportation companies, or direct ownership.

           The acquisition of manufacturing plants will require us to (i) identify suitable facilities that can be cost-effectively modified for our needs, (ii) conduct due diligence with respect to such facilities, including investigation of environmental risks and permitting, (iii) negotiate acceptable purchase or lease agreements and (iv) finance any such acquisitions and capital improvements. The construction of new facilities would require us to identify appropriate sites to locate plants. In either case, production facilities will need to be engineered and constructed or, in the case of existing plants, appropriate modifications completed. Also, we would have to establish relationships with engineering firms, construction companies and other service providers, as well as supplier relationships to obtain sources of the components of the renewable -fuel.

           Plant development, whether acquired or constructed, will necessitate governmental permitting and various regulatory approvals (including environmental, zoning and construction permits), which will likely vary from location to location and may cause delays and add significant costs. Moreover, given our limited operating history, relatively untested technology, experience, management and financial resources, there is no assurance that we will be able successfully to complete any plant acquisition or construction or that any such plants can be operated profitably.

Competition

           The market for the manufacture, marketing and sale of bio-diesel, heating and other alternative fuels is highly competitive. According to the National Biodiesel Board (NBB), as of January 31, 2007, there were at least 105 companies that are engaged in the development, manufacture and marketing of bio-diesel fuel, with current production capacity estimated at 864 million gallons per year. The NBB further estimates that another 1.7 billion gallons of annual plant capacity are under development (the preceding data reflect capacity, not actual production levels or demand). Such competition could be intense, thus driving up the costs of feedstock, plant construction, attracting and retaining qualified engineers, chemists and other key employees, as well as other operating expenses. Moreover, if production capacity in the industry increases faster than demand for bio-diesel and other alternative fuels, sale prices could be depressed. Falling oil prices would also negatively affect demand and the competitive position of bio fuel. We will also compete with petroleum fuels.

           Competition from other alternative fuels will likely increase if prices of energy on the commodities markets, including oil and bio-diesel, rise as they have in recent years. Additionally, new companies are constantly entering the market, thus increasing the competition. This could also have a negative impact on us or our sublicensees’ ability to obtain additional capital from investors. Larger foreign owned and domestic companies which have been engaged in this business for substantially longer periods of time may have access to greater financial and other resources. These companies may have greater success in the recruitment and retention of qualified employees, as well as in conducting their own fuel manufacturing and marketing operations, which may give them a competitive advantage. In addition, actual or potential competitors may be strengthened through the acquisition of additional assets and interests. If we or our sublicensees are unable to compete effectively or adequately respond to competitive pressures, this may materially adversely affect our results of operations and financial condition. On the other hand, if petroleum prices fall, competition from such fuels will intensify.

Intellectual Property

            We do not have any intellectual property.

4

Governmental Regulations

           Our business will be conducted in various countries, which have varying degrees of regulation. The following is a discussion of some U.S. regulations which may or may not apply to our operations.

           There are no readily apparent U.S. Environmental Protection Agency, or EPA, regulatory fuel certification requirements applicable to using the renewable diesel in a stationary source, such as industrial applications or home heating fuel, or in certain marine applications. There may, however, be requirements applicable to emissions from individual furnaces, boilers, etc. As a practical matter, market acceptance of the bio-fuel may be limited until we can demonstrate that (i) the renewable diesel is comparable to conventional fuels, from an energy content and emissions perspective, as well as handling and storage perspectives, and (ii) that the renewable diesel is compatible with existing heating systems or power generation systems and other combustion systems. To date, we have not demonstrated any of the foregoing in such commercially available systems. In addition, initial testing done on the renewable-diesel in a laboratory indicated that the renewable diesel is high quality fuel.

           We have evaluated whether the renewable diesel can be formulated to comply with the standards of the EPA to be classified as “diesel.” EPA standards mandate that the “diesel” comply with the specifications of the American Society for Testing and Materials (ASTM) requires that the fuel be comprised of. However, we are currently evaluating whether the ASTM standard can be broadened to include our fuel.

           In order to be legally marketable as a fuel for on-road motor applications, the bio-fuel must be registered with the EPA and comply with the EPA’s health effects regulations. Under these regulations, a company registering a fuel must either complete a literature review and possibly health effects testing, or submit an application with a group of other companies manufacturing similar fuels. The NBB has completed the required health effects testing on behalf of the bio-diesel industry, and provides the testing data to companies seeking to register their bio-diesel with the EPA. To fit under the NBB umbrella, and be considered “bio-diesel” for marketing purposes, the bio-fuel must meet the ATSM 6751 specifications for bio-diesel described above. European countries use similar standards. ASTM 6751 compliant bio-diesel is already registered with the EPA and also meets the clean diesel standards established by the California Air Resources Board (CARB) and certain other states. As of the date of this report, the current formulation of the bio-fuel does not comply with ASTM 6751. Because water is a component used in the manufacture of our bio-fuel, it is unlikely that we will be able to reformulate our fuel to meet this ASTM standard; accordingly, we would need to seek EPA approval as described above for our fuel to be used on on-road motor vehicle applications.

           We are evaluating the regulatory requirements for using our fuel in motor vehicle applications in our territory outside the United States.

           Environmental permitting of renewable diesel manufacturing facilities varies with the characteristics of individual plants. Our renewable diesel is manufactured using a process that is believed to yield little, if any wastes, emissions or discharges, although there may be some air emissions that could require us to obtain air emission permits to construct and operate any plants we may build or acquire.

           Being a mineral, the diesel does not require certification from car and engine manufacturers, provided it fulfills the EU standards. The KDV process produces a bio-diesel and therefore is eligible for tax benefits in certain countries.

Employees

           As of December 31, 2007, we had five full time employees. We believe our relationships with our employees are good.

5

Item 1A. Risk Factors

           Certain statements in this Annual Report on Form 10-K are “forward-looking statements”, these statements involve a number of risks, uncertainties and other factors that could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Factors which could materially affect such forward-looking statements can be found in the section entitled “Risk Factors” in this Item 1A. in this Annual Report on Form 10-K. Investors are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are only made as of the date hereof and we will undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

           References in this Annual Report on Form 10-K to “Global Energy” the “Company,” “we,” “us” or “our” are to Global Energy Inc., a Nevada corporation, and its subsidiaries.

Risks Related to Our Business

We are a development stage company with a limited operating history, which makes us a speculative investment.

           We are a development stage company that seeks to take advantage of the rights to the KDV technology to manufacture renewable diesel that is intended to be marketed as a new class of renewable-diesel, bio-mass or fuel additive. There can be no assurance that the renewable diesel will gain market acceptance, either from distributors or consumers.

           We have been engaged in organizational activities including developing a strategic operating plan and entering into contracts. We currently only have five employees. Other than limited testing activities with respect to our bio-fuel, we have not conducted any operations. We have not generated any revenues. Accordingly, we have limited relevant operating history upon which an evaluation of our performance and prospects can be made. Our prospects must be considered in light of inherent risks, expenses and difficulties encountered by companies in the early stages of development, particularly companies in new and evolving markets. Such risks include, but are not limited to, risks of unforeseen capital requirements, unforeseen technical problems, failure of market acceptance, failure to establish business relationships and competitive disadvantages against larger and more established companies.

We are unlikely to be able to continue as a going concern in the event we are unable to obtain additional financing.

           We have incurred a net accumulated deficit of $1,837,000 since inception. As of December 31, 2007, we had $1,470,000 of available cash. We have financed our operations to date primarily through the sale of debentures, our common stock and warrants in privately-negotiated transactions with accredited investors. We are unlikely to be able to continue as a going concern unless we are able to obtain additional financing. Future capital requirements could vary significantly and will depend on certain factors, many of which are not within our control. These include the ongoing development and testing of our technology, the nature and timing of licensing and sublicensing activities, plant construction, commencement of sales, hiring qualified management and employees, responding to competitive pressures, regulatory requirements, and the availability of financing. The expansion of our business will require us to commit significant capital resources in amounts substantially in excess of our current financial resources. Any needed financing may not be available on acceptable terms. In addition, future equity financings, if any, could be dilutive to then existing stockholders. In the event we do not raise sufficient capital to meet our obligations, we are likely to be unable to continue as a going concern unless we obtain additional financing. If such additional financing is not available our stockholders may lose their entire investment in our company.

We may not be able to achieve the objectives set forth in our new business plan.

           The focus of our activities will be building and operating a series of energy processing facilities to produce diesel from municipal solid waste, oil residuals, refinery wastes and biomass. We will work with local partners, which will include companies with the ability to supply large quantities of the required waste.

           We will initially set up three to four “demo” plants in countries where strategic partners able to supply the required waste have already been identified. These countries so far include the United States, Israel, Poland and Germany.

           We intend to develop, build and operate a significant number of energy processing plants, each capable of producing 10,000 liters of mineral diesel oil per hour and all based on the environmentally friendly KDV technology.

           There can be no assurance that we will be able to execute the above mentioned objectives. Additionally, we have not commenced the design, engineering, development or construction of any bio-fuel manufacturing plants.

6

Our business depends on proprietary technology that we may not be able to protect and may infringe on the intellectual property rights of others.

           Our success will depend, in part, on the viability for commercialization of the KDV technology and on the strength of the intellectual property rights relating to the KDV technology. The KDV technology is patented by Dr. Koch and Alphakat only in Germany, the USA and certain other countries. Patents sometimes are difficult to defend and others could independently develop substantially equivalent technology or otherwise gain access to trade secrets relating to the KDV technology, including through analysis or “reverse engineering” of the bio-fuel made with the KDV technology. Accordingly, we may not be able to protect the rights to our patented technology or we may work in countries where the patent has not been filed. In addition, any agreements with our employees, consultants, advisors, sublicensees and strategic partners restricting the disclosure and use of trade secrets, inventions and confidential information relating to the KDV technology may not provide meaningful protection in the event of unauthorized use or disclosure.

           Third parties may assert that the KDV technology, or the products we or our sub-licensees commercialize using the KDV technology, infringe upon their proprietary rights. We have yet to complete an infringement analysis and even if such an analysis were available at the current time, it is virtually impossible for us to be certain that no infringement exists, particularly in our case as our products have not yet been fully developed. Furthermore, because we have licensed the KDV technology from Alphakat and Dr. Koch there are additional inherent uncertainties about the origin and ownership of the intellectual property that could contribute to our infringement exposure.

           We could incur substantial costs in defending ourselves in suits brought against us for alleged infringement of another party’s intellectual property rights as well as in enforcing our rights against others. If we are found to infringe, the manufacture, sale and use of our or our sub-licensees’ products could be enjoined. Any claims against us, with or without merit, would likely be time-consuming, requiring our management team to dedicate substantial time to addressing the issues presented. Furthermore, many of the parties bringing claims may have greater resources than we do.

We may not be able to generate revenues.

           We have not generated any revenues and we do not expect to generate any material revenues until after we have successfully operated bio-fuel manufacturing plants and commenced commercial sales. We do not currently anticipate any of this to occur at least until the third quarter of 2008. Any start-up delays due to problems with the physical plant, staffing, permitting or other operational issues would negatively impact us. Any planned manufacturing plants may not achieve projected capacity. Companies to which we grant sublicenses or work with in a joint venture may not be able to produce, market and sell enough bio-diesel to pay us any amounts, or we or they may default on payments and lose rights to the technology. We may not be able to achieve profitable operations from the development of the KDV technology and/or the production of bio-fuel.

Unanticipated problems in our engineering and construction operations may harm our business.

           Our cash flow will depend on our ability and the ability of our joint venture partners to timely design, construct and complete bio-fuel manufacturing plants. If engineering and construction operations are disrupted and/or the economic integrity of these projects is threatened for unexpected reasons (including, but not limited to, technical difficulties, poor weather conditions, and business interruptions due to terrorism or otherwise) our business may experience a substantial setback. As a development stage company, we are particularly vulnerable to events such as these.

We may lose our rights to the KDV technology.

           If we do not fulfill our obligations set out in our agreement with Alphakat, we may lose the rights to develop, commercialize and market the KDV technology, leaving us without any business.

Our ability to produce and distribute commercial quantities of renewable diesel is unproven, which could have a detrimental effect on our ability to generate or sustain revenues.

           While production of bio-fuel from solid waste is a relatively mature technology, the technologies being pursued by us for bio-fuel production have never been utilized on a commercial basis. The renewable diesel we produce using our KDV technology, while intended as a new class of bio-fuel or fuel additive for power generation, heavy equipment, marine use and as a heating fuel, is in fact a new bio-fuel that may never achieve technical or commercial viability. All of the tests conducted to date by us with respect to the KDV technology have been performed in a limited scale environment and the same or similar results may not be obtainable at competitive costs on a large-scale commercial basis. We have never utilized the KDV technology under the conditions or in the volumes that will be required for us to be profitable and cannot predict all of the difficulties that may arise. The KDV technology, when used, may require further research, development, regulatory approvals, environmental permits, design and testing prior to commercialization. Accordingly, the KDV technology or the bio-fuel may not perform successfully on a commercial basis and they may never generate any revenues or be profitable.

7

The strategic relationships upon which we may rely are subject to change.

           Our ability to successfully sublicense our technology to third parties, to develop and operate manufacturing plants, and to identify and enter into commercial arrangements with customers will depend on developing and maintaining close working relationships with industry participants. Our success in this area will also depend on our ability to select and evaluate suitable projects, as well as to consummate transactions. These realities may impair our ability to grow.

           To develop our business, we will use our management team's (including those of any future management we retain) business relationships and those of our sublicensees in order to form strategic relationships. These relationships may take the form of joint ventures with other private parties or local government bodies or contractual arrangements with other bio-diesel and alternative fuel companies. There can be no assurances that we will be able to establish these strategic relationships, or, if established, that these relationships will be maintained, particularly if members of our management team leave. In addition, the dynamics of our relationships with strategic partners may require us to incur expenses or undertake activities we would not otherwise be inclined to incur or undertake in order to fulfill our obligations to these partners or maintain these relationships. If we do not successfully establish or maintain strategic relationships, our business may be negatively impacted.

           Moreover, reliance upon strategic partners to manufacture and sell bio-fuel using our KDV technology subjects us to additional risks, including a limited ability to control the quality of such fuel stemming from the failure of such partners to perform in accordance with the terms of agreements that they may enter into with us. Arrangements we enter into with such partners may compete with any bio-fuel that we may manufacture at our own plants and therefore may limit our organic growth.

Our business may suffer if we are unable to attract and/or retain talented personnel.

           We currently have five employees. Our success will depend in large measure on the abilities, expertise, judgment, discretion, integrity, and good faith of our management, and on other personnel we may hire. The loss of a key individual by us or our inability to attract suitably qualified replacements or additional staff could adversely impact our business. Our success depends on the ability of our management and employees to interpret market and technical data correctly, as well as to respond to economic, market, and other conditions and to manage effectively the production, marketing and sale of bio-fuel fuel using our KDV technology. Furthermore, no assurance can be given that our key personnel will continue their employment with us, or that replacement personnel with comparable skills will be found. If we are unable to attract and retain key personnel, our business may be adversely affected.

Competition may impair our success.

           The market for the manufacture, marketing and sale of renewable diesel (such as renewable diesel) and other alternative fuels is believed to be highly competitive. According to the National Bio-diesel Board (NBB), as of January 31, 2007, there are at least 105 companies that are engaged in the development, manufacture and marketing of bio-diesel fuel, with current production capacity estimated at 864 million gallons per year. The NBB further estimates that another 1.7 billion gallons of annual plant capacity are under development. Such competition could be intense, thus driving up the costs of feedstock, plant construction, attracting and retaining qualified engineers, chemists and other key employees, as well as other operating expenses. Moreover, if production capacity in the industry increases faster than demand for bio-fuels (including bio-diesel), sale prices could be depressed. Falling oil prices would also negatively affect demand for and the competitive position of alternative fuels such as our bio-fuel. We will also compete with petroleum fuels.

           Competition from alternative fuels will likely increase with the rise of energy prices on the commodities market, including of oil and bio-diesel, as has been occurring in recent years. Additionally, new companies are constantly entering the market, thus increasing the competition. This could also have a negative impact on us or our sublicensees’ ability to obtain additional capital from investors. Larger foreign owned and domestic companies which have been engaged in this business for substantially longer periods of time may have access to greater financial and other resources. These companies may have greater success in the recruitment and retention of qualified employees, as well as in conducting their own fuel manufacturing and marketing operations, which may give them a competitive advantage. In addition, actual or potential competitors may be strengthened through the acquisition of additional assets and interests. If we or our sublicensees are unable to compete effectively or adequately respond to competitive pressures, this may materially adversely affect our results of operation and financial condition.

Our management has identified a material weakness in internal control over financial reporting and we can provide no assurance that additional material weaknesses will not be identified in the future. The Company’s failure to implement and maintain effective internal control over financial reporting could result in material misstatements in the financial statements.

            Our management has identified a material weakness in our internal control over financial reporting as of December 31, 2007. See “Item 9A(T). Controls and Procedures.” We can provide no assurance that additional material weaknesses in our internal control over financial reporting will not be identified in the future. Any failure to maintain required controls, or any difficulties that may be encountered in the implementation of new or improved controls, could result in additional material weaknesses, cause the Company to fail to meet its periodic reporting obligations or result in material misstatements in the Company’s financial statements. The existence of a material weakness could result in errors in the Company’s financial statements that could result in a restatement of financial statements.

8

We may not effectively manage future growth.

           If we achieve rapid growth, it will place a significant strain on our financial, managerial, and operational resources. To achieve and manage growth effectively, we must continue to improve and expand our operational and financial management capabilities. Moreover, we will need to increase staffing and effectively train, motivate and manage our employees. Failure to manage growth effectively could harm our business, financial condition or results of operations.

We or our sublicensees may not be able to build or acquire and operate manufacturing plants on an economically viable basis.

           Any manufacturing plants that we or our sublicensees build or acquire may not be capable of production levels that are sufficient for commercial viability. On a long-term basis, we or our sublicensees will be dependent upon the ability to acquire solid waste, oil waste and agricultural products at reasonable prices, and to develop viable outlets for the sale of renewable diesel production. Our future will depend on our or our sublicensees’ ability to engineer, construct and operate future manufacturing plants, and successfully sell the fuel produced from these manufacturing plants.

           Completion of manufacturing plants does not assure a profit on the investment or recovery of construction costs and/or operating costs. Also, environmental damage may greatly increase the cost of operations, and various other field operating conditions may adversely affect the construction of bio-fuel manufacturing plants. These conditions include, but are not limited to, delays in obtaining governmental approvals or consents, shut-downs of operations and plant infrastructure resulting from extreme weather conditions, problems in storage, distribution of fuel, attracting and retaining qualified employees, labor relations and adverse geological and mechanical conditions. Therefore, these uncertainties are likely to have some adverse effect on our revenue and cash flow levels to varying degrees, and may result in the impairment of our business.

Prices and markets for renewable diesel (such as renewable diesel fuel) are unpredictable and tend to fluctuate significantly.

           The price of renewable diesel is determined based on world demand, supply and other factors that impact renewable diesel (including renewable diesel) as well as conventional and other alternative fuels, all of which are beyond our control. World prices for bio-diesel fuel have fluctuated widely in recent years and we expect that prices will continue to fluctuate. Price fluctuations will have a significant impact upon our revenue, results of operations and on our general financial condition. Price fluctuations for renewable diesel and other fuel may also impact the investment market, and our ability to raise investor capital. Future decreases in the price of bio-diesel and competing fuels may have a material adverse effect on our financial condition and future results of operations. In addition, in the United States, demand for bio-fuels is affected by certain federal and state tax benefits. The applicability, reduction or repeal of such tax benefits could adversely affect our business. Moreover, the bio-fuel may not be eligible for tax incentives provided to the bio-diesel industry.

Engineering, constructing and operating the bio-fuel manufacturing plants is risky.

           Engineering, constructing and operating the renewable diesel manufacturing plants involve a high degree of risk particularly when new technology such as ours is involved. These risks are more acute in the earlier stages of development. Our expenditures in developing manufacturing plants may not result in commercially viable projects. We cannot project the costs of constructing and operating manufacturing plants due to the inherent uncertainties of future feedstock prices and the future pricing of oil, diesel fuel, bio-diesel fuel, heating fuel, fuel additives and other alternative fuels, the costs associated with encountering unknown obstacles, and changes in market demands. If construction costs exceed our or our sublicensees’ estimates or if our or our sublicensees’ efforts do not produce results which meet our expectations, our business may not be commercially successful, which would have a material adverse effect on our results of operations and financial condition.

Our technology may become ineffective or obsolete.

           To be competitive in the bio-fuel industry, we may be required to continually enhance and update our KDV technology. The costs of doing so may be substantial, and may be higher than the costs that we anticipate for technology maintenance and development. If we are unable to maintain the efficacy of our KDV technology, our ability to manage our business and to compete may be negatively impaired. The impact of technical shortcomings could have a material adverse effect on our prospects, business, financial condition, and results of operations.

9

As of December 31, 2007 we had approximately $3,000,000 in principal amount of debt, which, if we cannot repay when due, will permit the holders of this debt to seek renegotiation or bankruptcy alternatives, the result of which could terminate implementation of our business plan.

           As of December 31, 2007 we have convertible into shares in the principal amount of $3,000,000 plus approximately $58,000 in interest, we have pledged all of our assets as security to YA Global Investments, L.P., the holder thereof. From time to time, we may also have trade debt and equipment financing outstanding. If we are unable to repay any of our obligations when due, our creditors could force our company into bankruptcy or force renegotiation of the terms of our outstanding debt on terms that may be substantially less favorable to us. In either event, our ability to pursue our business plan will be significantly impaired and the equity of our company may become worthless.

We may not be able to satisfy our debt obligations due to fluctuations in the market price of our common stock.

           We may satisfy our convertible debt obligations to the selling stockholder through the issuance of common stock or cash payments. If the price of our common stock drops considerably, and we cannot satisfy the repayment obligations through the issuance of common stock due to contractual limitations on issuance of securities included in the debentures, we currently do not have sufficient cash to satisfy these debt obligations. Defaulting under our company’s debt obligations may result in the lender exercising its rights under the terms of its security interest to force our company into bankruptcy or otherwise renegotiate the terms of our outstanding debt on terms that may be substantially less favorable to us. If these events occur, our ability to pursue our business plan will be significantly impaired and the equity of our company may become worthless.

Our business may be adversely affected by regulatory and environmental risks.

           Our business is subject to environmental risks and hazards and we are subject to environmental regulation implemented and/or imposed by a variety of international conventions as well as federal, state, provincial, and municipal laws and regulations. Environmental laws restrict and prohibit spills, discharges and emissions of various substances produced in association with our bio-fuel manufacturing operations. Environmental laws also require that manufacturing plants be operated, maintained and closed in such a way that satisfies applicable regulatory authorities.

           Compliance with environmental laws can require significant expenditures and a violation may result in the imposition of fines and penalties, some of which may be material. Environmental legislation is evolving in a manner we expect may result in stricter standards and enforcement, larger fines and liability, and potentially increased capital expenditures and operating costs. Compliance with environmental laws may cause us to limit our production, significantly increase the costs of our operations and activities, or otherwise adversely affect our financial condition, results of operations, and/or prospects.

Insurance may be inadequate to cover our liabilities.

           Our manufacturing plant operations, if any, may cause us to have liability for pollution, property damage, personal injury, or other hazards. Even if we obtain insurance to address such risks, insurance policies have limitations on liability that may not be sufficient to cover the full extent of our liabilities. Also some of our risks may not be insurable. If we suffer a significant event or occurrence that is not fully covered by insurance, or if the insurer of such event is not solvent, this could result in a material adverse effect on our results of operations or financial condition.

Our business is subject to local legal, political, and economic factors.

           We expect to operate our business in Europe, Israel, North America, China and Africa. Not all of these areas have stable legal, political and economic conditions. For the areas that do have stable legal, political and economic conditions, there is the risk that these conditions will change. These risks include, but are not limited to, terrorism, military repression, interference with private contract rights, currency fluctuations, inflation, exchange controls and other laws or policies affecting environmental issues (including land use and water use), workplace safety, foreign investment, foreign trade, investment or taxation, restrictions imposed on the alternative fuel industry (such as restrictions on production) and price and export controls. Any changes in alternative fuel, financial incentives, investment regulations, policies or a shift in political attitudes within our operating area are beyond our control and may adversely affect our business and future financial results.

Because our officers and directors are located in non-U.S. jurisdictions, our shareholders may have no effective recourse against the management for misconduct and may not be able to enforce judgment and civil liabilities against our officers, directors, experts and agents.

           All of our directors and officers are nationals and/or residents of countries other than the United States, and all or a substantial portion of their assets are located outside the United States. As a result, it may be difficult for investors to enforce within the United States any judgments obtained against our officers or directors, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any U.S. state.

10

Risks Related to our Common Stock

Shares of our common stock may continue to be subject to price fluctuations and illiquidity because our shares may continue to be thinly traded.

            Although a trading market for our common stock exists, the trading volume has historically been insignificant, and an active trading market for our common stock may never develop. There is currently no analyst coverage of our business, and the number of shares in our public “float” is limited. As a result of the thin trading market for our common stock, and the lack of analyst coverage, the market price for our shares may continue to fluctuate significantly, and will likely fluctuate more than the stock market as a whole. There may be a limited demand for shares of our common stock due to the reluctance or inability of certain investors to buy stocks quoted for trading on the OTCBB, lack of analyst coverage of our common stock, and a negative perception by investors of stocks traded on the OTCBB. As a result, even if prices appear favorable, there may not be sufficient demand to complete a stockholder’s sell order.

           Without an active public trading market or broader public ownership, shares of our common stock are likely to be less liquid than the stock of most public companies, and any of our stockholders who attempt to sell their shares in any significant volume may not be able to do so at all, or without depressing the publicly quoted bid prices for their shares.

The market price of our common stock is likely to be volatile.

           The market price of our common stock is likely to be volatile as a result of many factors including, but not limited to:

• the announcement of new products or product enhancements by us or our competitors;
• changes in the market for alternative fuels and generally in the capital markets;
• changes in the social, political and economic climate in the regions in which we operate;
• a lack of public awareness about availability of alternative fuels;
• announcements of technological innovations or new products available to the alternative fuel industry;
• developments concerning intellectual property rights and regulatory approvals;
• fluctuations in interest rates, exchange rates and the availability of capital in the capital markets; and
• the impact of sales and trading activity with respect to our common stock in the market.

           These and other factors are largely beyond our control, and the impact of these risks, singly or in the aggregate, may result in material adverse changes to the market price of our common stock and/or our results of operation and financial condition.

Future sales of common stock or warrants, or the prospect of future sales, may depress our stock price.

           Sales of a substantial number of shares of our common stock or warrants, or the perception that sales could occur, including by the selling stockholder, could adversely affect the market price of our common stock.

We may not be able to attract the attention of brokerage firms for research and support.

           Additional risks may exist due to the fact that we are an OTCBB company that became public without an underwritten offering. Securities analysts of brokerage firms may not provide us with coverage because there is no incentive to brokerage firms to recommend the purchase of our common stock. We cannot assure you that brokerage firms will want to conduct any secondary offerings on our behalf in the future.

If we issue additional shares in the future, it will result in the dilution of our existing shareholders.

           Our certificate of incorporation authorizes the issuance of up to 250,000,000 shares of common stock with a par value of $0.001. Our board of directors may choose to issue some or all of such shares to acquire one or more businesses or to provide additional financing in the future. The issuance of any such shares will result in a reduction of the book value and market price of the outstanding shares of our common stock. If we issue any such additional shares, such issuance will cause a reduction in the proportionate ownership and voting power of all current shareholders. Further, such issuance may result in a change of control of the Company.

Trading of our stock may be restricted by the Securities Exchange Commission's penny stock regulations, which may limit a stockholder's ability to buy and sell our stock.

           The Securities and Exchange Commission (the "Commission") has adopted regulations which generally define "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors". The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the Commission, which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation.

11

In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.

FINRA sales practice requirements may also limit a stockholder's ability to buy and sell our stock.

           In addition to the "penny stock" rules described above, the Financial Industry Regulatory Authority, or FINRA, has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, the FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Investors should not anticipate receiving cash dividends on our common stock.

           We have never declared or paid any cash dividends or distributions on our capital stock. We currently intend to retain our future earnings, if any, to support operations and to finance expansion and therefore we do not anticipate paying any cash dividends on our common stock in the foreseeable future. Investors seeking dividend income or liquidity should not invest in our common stock.

Carrigain Investment Ltd., or Carrigain, owns a significant portion of our common stock and may delay, defer or prevent us from taking actions that would be beneficial to our other stockholders.

           As of March 14, 2008, Carrigain owned approximately 66.50% of our outstanding common stock. Accordingly, Carrigain will be able to exercise significant influence over the outcome of substantially all matters required to be submitted to our stockholders for approval, including decisions relating to the election of our Board of Directors. In addition, Carrigain would be able to exercise significant influence over the outcome of any proposed merger or consolidation of our company. Carrigain’s ownership interest in our company may discourage third parties from seeking to acquire control of our company which may adversely affect the market price of our common stock.

Item 1B. Unresolved Staff Comments

            Not Applicable.

Item 2. Properties

           On October 5, 2007, our majority owned subsidiary Global Ethiopia, entered into lease agreements with the Southern Nations Nationalities People's Regional State, Ethiopia, or SNRS, for a 50 year lease of 20,000 hectares of rural land located in the Gamo Gofa zone in the SNRS for the purpose of cultivating castor seeds and 15 hectares of land located in the Gamu Gofa zone, Kucha Woreda, in the SNRS for the purpose of operating an oil crushing plant through an existing facility on the property.

           The agreements are subject to, among other things, the following conditions: (i) Global Ethiopia must pay SNRS a rental fee of Birr 47 (approximately US$5) or Birr 78 (approximately US$8.50) per hectare per year, depending on whether the leased land is defined as second or first class land, respectively; (ii) Global Ethiopia must completely develop the 20,000 hectares leased to it within eight years of the execution date of the agreement, including planting and maintaining trees or other oil producing crops. If no development process is carried out within a period of four (4) years from the date of execution of the agreement, then the undeveloped land may be repossessed by SNRS by giving six (6) months advance written notice to abandon the land; (iii) Global Ethiopia must completely develop the 15 hectares leased to it within three years of the execution date of the agreement; (iv) Global Ethiopia must perform a survey on the 20,000 hectares within 24 months of the execution date of the agreement; (v) Global Ethiopia has an option to lease additional farmland from the SNRS during the term of the lease agreement (up to an additional 100,000 hectares of farmland) on the same terms as the lease agreement for the 20,000 hectares; and (vi) Global Ethiopia is not required to make any rental payments on its 20,000 hectare lease agreement until the fourth year of the agreement.

           During the term of the lease agreements, SNRS may cancel the lease due to failure of Global Ethiopia to discharge its material obligations under the lease agreements, provided, however, that Global Ethiopia is given one year prior notice and fails to cure such failure within such one year period. Global Ethiopia is a 99.9% owned subsidiary of Pacific, a 50.1% owned subsidiary of our company that was formed as a joint venture with Yanai Man Projects Ltd. for the purpose of producing crude castor oil to aid in the manufacture of bio-diesel fuels.

12

           Our facilities located in Israel occupy approximately 150 square meters. Our current lease commitment relating to our facility in Israel expires at the end of August 2009.

Item 3. Legal Proceedings

            We are currently not a party to any legal proceedings.

Item 4. Submission of Matters to a Vote of Security Holders

           No matters were submitted to a vote of our security holders through a solicitation of proxies or otherwise during the quarterly period ended December 31, 2007.

PART II

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuers Purchases of Equity Securities

Market for Common Equity

           Our common stock is quoted on the OTC Bulletin Board under the symbol “GEYI”. Trading in our common stock has occurred on a relatively inconsistent basis and the volume of shares traded has been limited.

           The following table shows the quarterly high and low reported bid prices per share for our common stock over the fiscal quarters for the last two fiscal years as quoted on the OTC Bulletin Board. The bid prices represent quotations by dealers without adjustments for retail mark-ups, mark-downs or commissions and may not represent actual transactions. Investors should not rely on historical prices of our common stock as an indication of its future price performance. The last sale price of our common stock on March 26, 2008, was $0.65 per share.

	Low	High
2006
First Quarter	$0.01	$0.01
Second Quarter	$0.01	$0.01
Third Quarter	$0.01	$0.01
Fourth Quarter	$0.01	$0.01
2007
First Quarter	$0.01	$0.01
Second Quarter	$0.01	$2.05
Third Quarter	$0.25	$1.75
Fourth Quarter	$0.25	$0.99

Holders

           As of March 14, 2008, there were 63,187,764 shares of our common stock outstanding held by 48 stockholders of record.

Dividends

           We have not paid any cash dividends on our common stock and do not anticipate paying any cash dividends in the foreseeable future. We currently intend to retain future earnings, if any, to fund the development and growth of our business. Any future determination to pay cash dividends will be at the discretion of our board of directors and will be dependent upon our financial condition, operating results, capital requirements, applicable contractual restrictions and other factors as the board of directors deems relevant.

Recent Sales of Unregistered Securities

            During the 2007 fiscal year, we have sold and issued the following unregistered securities:

           On February 7, 2007, we issued a total of 17,031,000 shares of common stock at a price per share of US$0.01 to 21 investors for an aggregate consideration of $170,310 of which $40,910 was paid in cash and $129,400 was paid by the issuance of a note with maturities ranging from 90 days to one year. We issued the securities to the investors who are non-U.S. persons (as that term is defined in Regulation S of the Securities Act) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act.

           On April 30, 2007, we issued 40,175,000 shares of common stock to 12 investors at a purchase price per share of US$0.01 for an aggregate consideration of $401,750 of which approximately $47,000 was paid in cash, approximately $28,000 was by redemption of promissory notes and approximately $327,000 was paid by the issuance of notes receivables having maturities up to one year. As of December 31, 2007, an amount of $150,000 has not been collected yet.

13

We issued the securities to investors who are non-U.S. persons (as that term is defined in Regulation S of the Securities Act) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act.

           On April 30, 2007, we granted 5,055,021 stock options exercisable for five years at an exercise price of $0.01 per share to Asi Shalgi, the new President of the Company. Effective January 31, 2008, the expiration date of the options was extended to April 30, 2017 and such options will begin to vest at a rate of 25% per year beginning April 30, 2008. We issued the stock options to non-U.S. persons (as that term is defined in Regulation S of the Securities Act) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act.

           On May 1, 2007, pursuant to the terms of an employment agreement, we granted options to purchase 400,000 shares of common stock exercisable for five years at an exercise price of $0.01 per share to Dr. Irit Arbel, who was hired to be the Investor Relations and Marketing Advisor of the Company. Dr. Arbel’s employment agreement was terminated as of January 1, 2008 and 50,000 options were forfeited upon the termination. We issued the stock options to non-U.S. persons (as that term is defined in Regulation S of the Securities Act) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act.

           On July 10, 2007, we issued a 10% secured convertible debenture, for gross proceeds of $500,000, as a part of a private placement of up to $4,000,000 in value of debentures to the same investor. In conjunction with this financing, we issued warrants to purchase 300,000 shares of common stock exercisable for five years at an exercise price of $2.35 and warrants to purchase additional 300,000 shares of common stock exercisable for five years at an exercise price of $2.50. We paid a cash commission of $35,000 and a structuring fee of $20,000 to Yorkville Advisors, LLC in connection with this issuance.

           The 10% secured convertible debentures, which, as amended, mature on October 31, 2010, are convertible by the debenture holder into common shares at a fixed conversion price of $2.20 per share. The debentures are secured against all our assets.

           On October 23, 2007, we issued an additional 10% secured convertible debenture for an aggregate consideration of $1,500,000. The debenture matures on October 31, 2010 and is convertible by the debenture holder into common shares at a fixed conversion price of $2.20 per share subject to further adjustment as further set out in the debenture. The debenture is secured against all our assets. We paid a commission of $105,000 and a due diligence fee of $30,000 to Yorkville Advisors, LLC in connection with this issuance.

           The debenture was issued pursuant to the exemption from registration under the Securities Act provided by Section 4(2), Section 4(6) and/or Rule 506 of Regulation D promulgated under the Securities Act to the investors and brokers who are “accredited investors” within the respective meanings ascribed to that term in Rule 501(a) under the Securities Act.

           On December 5, 2007 we issued a 10% secured convertible debenture for gross proceeds of $1,000,000. The debenture matures on October 31, 2010 and is convertible by the debenture holder into common shares at a fixed conversion price of $2.20 per share subject to further adjustment as further set out in the debenture. The debenture is secured against all our assets. We paid a commission of $70,000 to Yorkville Advisors, LLC in connection with this issuance.

           The debenture was issued pursuant to the exemption from registration under the Securities Act provided by Section 4(2), Section 4(6) and/or Rule 506 of Regulation D promulgated under the Securities Act to the investors and brokers who are “accredited investors” within the respective meanings ascribed to that term in Rule 501(a) under the Securities Act.

           Throughout fiscal year 2007, we authorized the issuance of options to our directors and officers to acquire in the aggregate 2,200,000 shares of our common stock. We granted these options on January 31, 2008. For more information, see "Item 11. Executive Compensation".

Use of Proceeds from Registered Securities

            None.

Issuer Purchases of Equity Securities

            None.

Item 6. Selected Consolidated Financial Data

            Not applicable.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion in conjunction with our consolidated financial statements and related notes thereto. In addition to historical information, this discussion contains forward-looking statements that involve risks, uncertainties and assumptions that could cause actual results to differ materially from management’s expectations. Factors that could cause such differences include those described in “Risk Factors” in Item 1A in this Annual Report on Form 10-K.

14

Overview

           Our company was organized on February 16, 1999, under the laws of the State of Nevada as Global Smartcards Inc. On April 28, 2003, we changed our name to Global Energy Inc. Our business address is 415 Madison Avenue, 15th Floor, New York, New York. Our telephone number is +1 (646) 673-8435. Our registered agent is Rite, Inc., 1905 South Eastern Ave., Las Vegas, NV 89104.

           Effective July 1, 2005, we sold all of our oil and gas assets for the sum of $50,000. The sale of these oil and gas assets was completed on July 6, 2005.

Our Current Business

           Our mission is to produce and supply alternative fuels, based on alternative energy producing technologies, which utilize renewable sources for creating viable energy sources while contributing to severe environmental conservation issues.

           Our strategy is to operate a growing number of owned industrial scale production facilities in several international locations and emerge as a leading supplier of mineral diesel, selling to industrial and governmental customers on every level of the supply chain.

           On May 2, 2007, we entered into a letter of intent with AlphaKat, pursuant to which we agreed, subject to certain conditions, to purchase the AlphaKat’s KDV 500 turbine technology and assist with the marketing and development of the technology. In connection with the development of the KDV technology and the construction of the plants, we agreed to: (i) provide financial support for the project, (ii) create a joint venture company for the marketing and development of the technology; (iii) purchase three KDV 500 turbines for implementation in Poland, the United States and Israel; (iv) start a regulatory process, including filing of permit applications at a cost of Euro €100,000; commence monthly payments of Euro €10,000 to Dr. Christian Koch, the owner of AlphaKat, after due diligence on the KDV 500 turbine is completed; and (v) enter into a definitive agreement for the KDV 500 turbine. We are currently working on receiving permits in the United States and Israel, while in Poland and Germany we achieved basic permits from the authorities for the implementation of the KDV 500 turbine. As of the date of this report, we have not ordered any of the KDV 500 turbines other than placing an advanced payment for one unit.

           In May, 2007, we established two subsidiaries in Israel: Global Fuel Israel Ltd., or Fuel, and Global N.R.G. Pacific Ltd., or Pacific. Fuel will render services to us, however the nature and the scope of the services is not yet defined.

           On July 9, 2007, we entered into a shareholder agreement to form a joint venture with Yanai Man Projects Ltd., or Yanai, pursuant to which we hold 50.1% of Pacific and Yanai holds 49.9% of Pacific. Pacific's purpose is the procurement of agricultural knowledge and the growth of vegetation for the purpose of producing crude castor oil to aid in the process of manufacturing bio-diesel fuel. The first project is to work with an Ethiopian entity to farm castor seeds for castor oil in Ethiopia.

           On July 10, 2007, we entered into an agreement with AlphaKat based on the letter of intent executed by the parties on May 2, 2007, to produce mineral diesel from municipality solid waste using the KDV process, originally developed by AlphaKat and its owner Dr. Christian Koch, over a 30 year period. The process is applicable to biomass waste and any waste containing organic materials (hydrocarbons), including plastic, textile, rubber, leather, wood, paper, animal and agriculture waste. The KDV depolymerization technology is an alternative-energy source. It provides a patent-protected solution for the simultaneous creation of clean energy and the disposal of waste. The process uses a high speed turbine and a proprietary catalyst to convert and distillate waste into diesel oil. The result is a sulphate free diesel oil that meets the requirements of the EN590 standard for diesel oil and is intended for use in trucks and heavy equipment, as well as by major petroleum companies.

           Pursuant to the agreement with AlphaKat, we incorporated and operate a company named AlphaKat-Global Energy GmbH. We and AlphaKat each hold 50% of the shares of AGEI. The goal of AGEI is to provide worldwide marketing and sales of technology which converts hydrocarbon waste into diesel oil. AGEI has the exclusive rights to sell certain technology of Alphakat in the United States and China and has non-exclusive rights for certain other parts of the world.

           On October 5, 2007, our majority owned subsidiary, Global Energy Ethiopia PLC, or Global Ethiopia, entered into lease agreements with the Southern Nations Nationalities People's Regional State, Ethiopia, or SNRS, for a 50 year lease of 20,000 hectares of rural land located in the Gamo Gofa zone in the SNRS for the purpose of cultivating castor seeds and 15 hectares of land located in the Gamu Gofa zone, Kucha Woreda, in the SNRS for the purpose of operating an oil crushing plant through an existing facility on the property.

           On October 20, 2007, we entered into an agreement for consulting services with Trianon Partners, or Trianon, and as of October 24, 2007, we entered into a joint development agreement with Trianon. In consideration of the consulting services to be provided by Trianon, we agreed to pay Trianon a fixed fee of $250,000 which was to be paid in equal monthly installments of $10,000 once we decided to commence the construction of the plant, with the balance to be paid upon mechanical completion of the plant.

15

The agreement for consulting services was terminated by mutual consent on February 6, 2008. In consideration of the joint development agreement, we agreed to grant an exclusive license to Trianon, throughout the States of Texas, New York and New Jersey to be formed with AlphaKat, to market systems that use a proprietary bio-diesel technology for the conversion of waste to bio-diesel.

           On February 6, 2008, we entered into a business and royalty agreement with Covanta Energy Corporation, under which we granted to Covanta certain rights, both exclusive and non-exclusive, for the use, practice, and improvement of the KDV technology for the purpose of converting waste materials containing hydrocarbons into diesel oil in countries including the US, the UK, China and the Republic of Ireland. We did so in exchange for the retention by us of certain rights to pursue specified small scale projects using the technology, which Covanta will have the option to invest in, as well as our retention of the right to invest 10% - 35% of the equity in projects initiated by Covanta. Covanta agreed to pay us a royalty equal to 10% of the gross revenues derived from the sale of diesel oil from each project for a period of 20 years from the date the applicable project achieves commercial operation. Under the agreement, Covanta shall also be responsible for financing 100% of the costs of erection of a demonstration plant, which it may disassemble and make available for pick up by us, at no cost to us, upon Covanta terminating its rights to the technology.

           On the same day, we entered into a license agreement with Covanta under which we granted it a right to sell systems based on the technology to governmental organizations subject to certain pre-conditions regarding the purchase of a minimum number of systems based on the technology. Covanta's rights under both the license agreement and the business and royalty agreement shall be non-exclusive until it has (i) issued a purchase order for a demonstration plant, and (ii) placed purchase orders for five additional systems. AlphaKat-Global Energy GmbH will receive a 10% commission from the sale of all systems, part of which shall be payable to American Renewable Diesel, LLC, subject to the business and development agreement described below.

           On February 6, 2008, we executed a business and development agreement with Renewable Diesel, LLC, an affiliate of Trianon Partners and of American Renewable Diesel, LLC, under which both Renewable and our company shall have the right to identify and develop certain projects to convert feedstock to diesel using the KDV technology in New York, California and Texas, as well as Florida and New Jersey under certain conditions. If we identify a project, Renewable shall be entitled to invest up to 25% of the total required equity. If Renewable identifies a project, we shall be entitled to invest up to 51% and Covanta will be entitled to invest up to 24% of the total required equity. In all projects, Renewable shall manage the projects and shall be entitled to development fees in the amount of $100,000, up to a total of $2,000,000, for each KDV 500 system included in the project.

            In connection with the business and development agreement described above, AlphaKat-Global Energy GmbH executed a license agreement with American Renewable Diesel, LLC, an affiliate of Trianon Partners and of Renewable, which granted American certain exclusive rights to market and sell systems based on the technology in the territory of California, New York and Texas, as well as New Jersey and Florida, subject to the satisfaction of minimum sales requirements. The territory may be reduced and/or exclusive rights may become non-exclusive rights, depending on whether minimum sale requirements are satisfied. American is to receive a commission on all sales in the territory. Systems sold to Covanta shall be credited to American, regardless of whether such systems are for use inside or outside the territory.

           In March 2008 we entered into a Memorandum of Understand with ShenMu SanJiang Coal Chemical Company Ltd. (“Shaanxi”) located in the People’s Republic of China. Under the terms of the MOU, we and Shaanxi, pending completion of due diligence of the KDV technology in Germany, plan to jointly own a new entity. We would own 51% of the new entity, unless Sinopec Beijing Governmental Energy Company becomes a substantial equity partner, in which case our interest would be 26%. The new entity would initially build, own and operate an AlphaKat system expected to produce ten thousand (10,000) liters of diesel per hour from tar oil. Shaanxi is a producer of blue coal, where significant quantities of tar oil are produced as a residual of the production process. Shaanxi would provide the new company with tar oil at a discount to the published market price for conversion into high quality diesel. The MOU provides for the extension and growth capabilities of the “system” after successful conversion of tar oil to diesel. We would be entitled, under the terms of the MOU, to royalties from the sale of diesel produced by the AlphaKat KDV Technology. Completion of the transaction is subject to due diligence and negotiation of final documentation.

Critical Accounting Policies

A. Going concern considerations

            As of December 31, 2007, the Company had negative working capital of $1,479 thousands and an accumulated deficit of approximately $1,837 thousands. The Company's ability to continue to operate as a going concern is dependent on its ability to generate sufficient cash flows to meet its obligations on a timely basis, to obtain additional financing and to ultimately attain profitability. The Company has no revenues and has incurred losses and an accumulated deficit resulting from the company’s activity as a development stage company and has a negative cash flow from operating activities. In the event the Company is unable to successfully raise capital and generate revenues, it is unlikely that the Company will have sufficient cash flows and liquidity to finance its business operations as currently contemplated.

16

There can be no assurance that additional funds will be available on terms acceptable to the Company, or at all. These conditions raise substantial doubt about the Company's ability to continue to operate as a going concern. The financial statements contained in this annual report do not include any adjustments to reflect the possible future effect on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

B. Derivative financial instruments (“derivatives”)

           The Company has adopted FAS 133, as amended, which establishes accounting and reporting standards for derivatives, including certain derivatives embedded in other contracts, and for hedging activities. Under FAS 133, all derivatives are recognized on the balance sheet at their fair value. On the date that the Company enters into a derivative contract, it designates the derivative, for accounting purposes, as: (1) hedging instrument, or (2) non-hedging instrument. Any changes in fair value are to be reflected as current gains or losses or other comprehensive gains or losses, depending upon whether the derivative is designated as a hedge and what type of hedging relationship exists. Changes in fair value of non-hedging instruments are carried to “financial expenses-net” on a current basis. To date, the Company did not have any contracts that qualify for hedge accounting under FAS 133.

Results of Operations – Fiscal Year Ended December 31, 2007

           We initiated our activities during the last six month of 2007, focusing our effort in building an infrastructure that will support our future activities in the alternative energy areas. We did not generate any revenue in the year ended December 31, 2007 and have incurred a loss of $1,665,000.

Liquidity and Capital Resources

           Our cash equivalents were $1,470,000 as of December 31, 2007, compared to $11,000 as of December 31, 2006. This increase in cash equivalents is attributed to an issuance of convertible debenture which took place during the last four month of 2007. The Company raised an amount to $2,790,000 by an issuance of convertible debenture. As of December 31, 2007, the Company has received three installments amounting to $3,000,000 ($2,790,000 net of issuance cost). The Company needs to finance its future activities from its cash equivalents. At December 31, 2007, we had a negative working capital of $1,479,000; we are expecting to continue to consume cash in our activities through payments of salaries, payments for services and other costs. We also plan to continue financing our operations through a combination of private placement, stock issuances, debt issuances, mutual development with possible milestone license payments and research and development programs. There are no assurances, however, that we will be successful in obtaining an adequate level of financing required for the long-term development and commercialization of our planned products.

Off-Balance Sheet Arrangements

            We do not currently have off-balance sheet arrangements.

Going Concern Considerations

           As of December 31, 2007, the Company had negative working capital of $1, 479 thousands and a capital deficiency of $936 thousands. The Company's ability to continue to operate as a going concern is dependent on its ability to generate sufficient cash flows to meet its obligations on a timely basis, to obtain additional financing and to ultimately attain profitability. The Company has no revenues and has incurred recurring operating losses and an accumulated deficit and has a negative cash flow from operating activities.

            In the event the Company is unable to successfully raise capital and generate revenues, it is unlikely that the Company will have sufficient cash flows and liquidity to finance its business operations as currently contemplated. Accordingly, the Company will likely reduce general and administrative expenses and cease or delay development projects until it is able to obtain sufficient financing. There can be no assurance that additional funds will be available on terms acceptable to the Company, or at all.

           These conditions raise substantial doubt about the Company's ability to continue to operate as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effect on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainly.

Risk Factors

           The fuel produced using our KDV technology has never achieve technical or commercial viability yet. The Company has never utilized the KDV technology under the conditions or in the volumes that will be required for us to be profitable and cannot predict all of the difficulties that may arise. The KDV technology, when used, may require further research, development, regulatory approvals, environmental permits, design and testing prior to commercialization. Accordingly, the KDV technology to manufacture fuel may not perform successfully on a commercial basis and they may never generate. For discussion of further risks related to our business and operations see “Risk Factors” in Item 1A in this Annual Report on Form 10-K.

17

Employees

           Currently we have five employees: Asaf Shalgi our President, Chief Executive Officer and a director; Yossi Raz, our Chief Technology Officer; Alex Werber, our Chief Financial Officer and Treasurer; Yanai Man who manages our Bio-diesel activities, and a Company secretary who serves as our office manager in Israel.

Competition

           The market for the manufacture, marketing and sale of bio-diesel, heating and other alternative fuels is highly competitive. According to the National Biodiesel Board (NBB), as of January 31, 2007, there were at least 105 companies that are engaged in the development, manufacture and marketing of bio-diesel fuel, with current production capacity estimated at 864 million gallons per year. The NBB further estimates that another 1.7 billion gallons of annual plant capacity are under development (the preceding data reflect capacity, not actual production levels or demand). Such competition could be intense, thus driving up the costs of feedstock, plant construction, attracting and retaining qualified engineers, chemists and other key employees, as well as other operating expenses. Moreover, if production capacity in the industry increases faster than demand for bio-diesel and other alternative fuels, sale prices could be depressed. Falling oil prices would also negatively affect demand and the competitive position of bio fuel. We will also compete with petroleum fuels.

           Competition from other alternative fuels will likely increase if prices of energy on the commodities markets, including oil and bio-diesel, rise as they have in recent years. Additionally, new companies are constantly entering the market, thus increasing the competition. This could also have a negative impact on us or our sublicensees’ ability to obtain additional capital from investors. Larger foreign owned and domestic companies which have been engaged in this business for substantially longer periods of time may have access to greater financial and other resources. These companies may have greater success in the recruitment and retention of qualified employees, as well as in conducting their own fuel manufacturing and marketing operations, which may give them a competitive advantage. In addition, actual or potential competitors may be strengthened through the acquisition of additional assets and interests. If we or our sublicensees are unable to compete effectively or adequately respond to competitive pressures, this may materially adversely affect our results of operations and financial condition. On the other hand, if petroleum prices fall, competition from such fuels will intensify.

Plan of Operations

           During the next twelve months we will continue to concentrate on our two main activities, the first dealing with the development of plants for the production of diesel out of domestic waste (industrial activities) and the second focusing on our project in Ethiopia for the cultivation of castor plant for biodiesel production (agricultural activities).

           In the industrial activity we will continue to initiate joint ventures to use the technology of diesel oil production out of domestic and organic waste and to establish partnerships in order to set up plants for diesel production out of waste.

           We will continue our agricultural project started in the last quarter of 2007 in Ethiopia for the growing and cultivation of the castor plant. In the frame of this project we expect cultivate between 6,000 – 12,000 hectares base on our agreements with farmers and local states in south of Ethiopia. Nowadays we are in a process of establishment of the logistics and administrative layout in the project area and we are starting to sow the castor seeds. The cultivation will be carried out by rural farmers in the region. We undertook to employ the farmers by providing input and agronomic support. In addition, we will continue to develop 20,000 hectares leased from Southern Nations Nationalities People's Regional State, Ethiopia ("SNRS").

Capital Resource Requirements

           The scope of our activities rely upon our abilities to raise sufficient funds in order to finance our future plans. The minimum requirement for the next 12 months ending December 31, 2008, is approximately $27.4 million for our proposed business activities. This budget includes the funds required to finance our marketing activities, purchase of KDV machines, salaries of the employees, office and maintenance costs, cost of cultivation and among others, all of them necessary to execute our plan of operations. The following table provides a cost-breakdown of the upcoming year of operations.

Estimated Funding Required During the Next 12 Months
G&A Salaries	$	400,000
Other Operations	$	750,000
Industrial Expenses	$	16,250,000
Agriculture Expenses	$	10,000,000
Total	$	27,400,000

Newly Issued Accounting Pronouncements

           In December 2007, the FASB issued Statement of Financial Accounting Standards No. 141 (revised 2007), "Business Combinations" ("SFAS 141(R)". SFAS 141(R) changes the accounting for business combinations, including

18

the measurement of acquirer shares issued in consideration for a business combination, the recognition of contingent consideration, the accounting for contingencies, the recognition of capitalized in-process research and development, the accounting for acquisition-related restructuring cost accruals, the treatment of acquisition related transaction costs and the recognition of changes in the acquirer’s income tax valuation allowance and income tax uncertainties. SFAS 141(R) applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. Early application is prohibited. The Company will be required to adopt SFAS 141(R) on January 1, 2009.

           In December 2007, the FASB issued FAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements - an amendment of Accounting Research Bulletin No. 51” (“FAS No. 160”). FAS No. 160 establish accounting and reporting standards for non-controlling interests in a subsidiary and deconsolidation of a subsidiary. Early adoption is not permitted. As applicable to the Company, these statements will be effective as of the year beginning January 1, 2009. The Company is currently evaluating the potential impact, if any, the adoption of FAS No. 160 would have on its consolidated financial statements.

           In September 2006, the FASB issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”). SFAS 157 defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years (January 1, 2008, for the Company). The Company is currently assessing the impact that SFAS 157 may have on its results of operations and financial position.

           In February 2007, the FASB issued Statement of Financial Accounting Standards No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities - Including an amendment of FASB Statement No. 115” (“SFAS 159”). SFAS 159 is expected to expand the use of fair value accounting but does not affect existing standards which require certain assets or liabilities to be carried at fair value. The objective of SFAS 159 is to improve financial reporting by providing companies with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. Under SFAS 159, a company may choose, at its initial application or at other specified election dates, to measure eligible items at fair value and report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date. SFAS 159 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years (January 1, 2008, for the Company). If the company is to elect the fair value option for its existing assets and liabilities, the effect as of the adoption date, shall be reported as a cumulative-effect adjustment to the opening balance of retained earnings. The Company is currently assessing the impact that SFAS 159 may have on its financial position.

           In December 2007, the FASB ratified EITF Issue No. 07-01, "Accounting for Collaborative Arrangements" ("EITF 07-01"). EITF 07-01 defines collaborative arrangements and establishes reporting requirements for transactions between participants in a collaborative arrangement and between participants in the arrangement and third parties. EITF 07-01 also establishes the appropriate income statement presentation and classification for joint operating activities and payments between participants, as well as the sufficiency of the disclosures related to these arrangements. EITF 07-01 is effective for fiscal years beginning after December 15, 2008 (January 1, 2009, for the Company). EITF 07-01 shall be applied using modified version of retrospective transition for those arrangements in place at the effective date. An entity should report the effects of applying this Issue as a change in accounting principle through retrospective application to all prior periods presented for all arrangements existing as of the effective date, unless it is impracticable to apply the effects the change retrospectively. The Company is currently assessing the impact that EITF 07-01 may have on its results of operations and financial position.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

            Not applicable.

Item 8. Financial Statements and Supplementary Data

19

GLOBAL ENERGY INC.
(A development stage company)

CONSOLIDATED FINANCIAL STATEMENTS

2007 ANNUAL REPORT

F-1

GLOBAL ENERGY INC.
(A development stage company)

2007 ANNUAL REPORT

TABLE OF CONTENTS

	Page
REPORTS OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS	F-3
CONSOLIDATED FINANCIAL STATEMENTS IN U.S. DOLLARS:
Balance Sheets	F-5
Statements of operations	F-6
Statements of changes in shareholders' equity (capital deficiency)	F-7
Statements of cash flows	F-8
Notes to financial statements	F-9-23

_____________________
____________________________________
_____________________

F-2

	Kesselman & Kesselman Certified Public Accountants Trade Tower, 25 Hamered Street Tel Aviv 68125 Israel P.O Box 452 Tel Aviv 61003 Telephone +972-3-7954555 Facsimile +972-3-7954556

Report of Independent Registered Public Accounting Firm

To the shareholders of Global Energy Inc. (a development stage company):

We have audited the accompanying consolidated balance sheets of Global Energy Inc. and its subsidiaries (a development stage enterprise) as of December 31, 2007, and the related consolidated statement of operations, changes in shareholders' equity (capital deficiency) and cash flows for the year ended December 31, 2007 and, cumulatively, the period from January 1, 2007 to December 31, 2007 (not separately presented herein). These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We did not audit the cumulative totals of the Company for the period from July 5, 2005 (date of inception) to December 31, 2006, which totals reflect a deficit of $98,998 accumulated during the development stage. Those cumulative totals were audited by other auditors whose report, dated February 9, 2007, expressed an unqualified opinion on the cumulative amounts.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the December 31, 2007 consolidated financial statements referred to above present fairly, in all material respects, the financial position of Global Energy Inc. and its subsidiaries (a development stage enterprise) at December 31, 2007, and the results of their operations and their cash flows for the year then ended and, cumulatively, for period from January 1, 2007 to December 31, 2007 (not separately presented herein), in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1c to the financial statements, the Company has suffered recurring losses from operations, has limited capital resources and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1c. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Kesselman & Kesselman
Tel Aviv, Israel
March 31, 2008

F-3

Chang Lee LLP

Chartered Accountants

505 – 815 Hornby Street

Vancouver, B.C, V6Z 2E6

Tel: 604-687-3776

Fax: 604-688-3373

E-mail: info@changleellp.com

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

GLOBAL ENERGY INC.
(A development stage company)

We have audited the balance sheets of Global Energy Inc. (“the Company”) (a development stage company) as at December 31, 2006 and 2005 and the related statements of operations, stockholders’ equity, and cash flows from July 7, 2005 (date of becoming a development stage company) to December 31, 2006 and statements of operations, stockholders’ equity, and cash flows for the years ended December 31, 2006 and 2005. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as at December 31, 2006 and 2005 and the results of their operations and their cash flows for the years ended December 31, 2006 and 2005 and for the period from July 7, 2005 (date of becoming a development stage company) to December 31, 2006 in conformity with generally accepted accounting principles in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1, the Company has incurred operating losses. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Vancouver, Canada
February 9, 2007	Chartered Accountants

F-4

GLOBAL ENERGY INC.
(A development stage company)
CONSOLIDATED BALANCE SHEETS

		December 31
		2007			2006
		In thousands
Assets
CURRENT ASSETS:
Cash and cash equivalents	$	1,470		$	11
Other accounts receivable		187
Total current assets		1,657			11
LONG TERM DEPOSITS		18
ADVANCE TO MINORITY INTEREST SHAREHOLDER		20
PROPERTY AND EQUIPMENT, net of accumulated depreciation		523
Total assets	$	2,218		$	11
Liabilities net of capital deficiency
CURRENT LIABILITIES:
Accounts payables	$	183		$	10
Accounts payable - other		317
Demand loans payable - related parties		18			18
Promissory note payable					28
Debentures convertible into shares		2,618
Total current liabilities		3,136			56
MINORITY INTEREST		18
CAPITAL DEFICIENCY:
Share capital (Note 9) -
Common shares of $0.001 par value each:
Authorized: 250,000,000 shares and 25,000,000 at
December 31, 2007 and December 31, 2006, respectively;
Issued and outstanding: 63,187,764 shares and 5,981,764 shares
at December 31, 2007 and December 31, 2006, respectively		63			6
Additional paid-in capital		742			117
Warrants		246
Share subscription received					4
Receivables in respect of shares issued		(150	)
Accumulated deficit during development stage		(1,764	)		(99	)
Accumulated deficit before development stage		(73	)		(73	)
Total capital deficiency		(936	)		(45	)
Total liabilities net of capital deficiency	$	2,218		$	11

The accompanying notes are an integral part of the consolidated financial statements.

F-5

GLOBAL ENERGY INC.
(A development stage company)
CONSOLIDATED STATEMENTS OF OPERATIONS

											Cumulative
											from July 7,
											2005 through
		Year ended December 31									December 31,
		2007			2006			2005			2007
		In thousands, except share data
OPERATING EXPENSES -
General and administrative expenses (*)	$	(1,589	)	$	(69	)	$	(62	)	$	(1,688	)
OPERATING LOSS		(1,589	)		(69	)		(62	)		(1,688	)
FINANCIAL EXPENSES - NET		(76	)								(76	)
NET LOSS FROM CONTINUING
OPERATIONS		(1,665	)		(69	)		(62	)		(1,764	)
NET INCOME FROM DISCONTINUED
OPERATION (NET OF TAX)								68
NET INCOME (LOSS)	$	(1,665	)	$	(69	)	$	6		$	(1,764	)
NET INCOME (LOSS)
SHARE, BASIC AND DILUTED:
NET LOSS PER SHARE FROM
CONTINUING OPERATIONS	$	(0.03	)	$	(0.01	)	$	(0.01	)
NET INCOME PER SHARE FROM
DISCONTINUING OPERATIONS							$	0.01
NET LOSS PER SHARE FOR
THE YEAR	$	(0.03	)	$	(0.01	)		**
WEIGHTED AVERAGE NUMBER OF
SHARES USED IN COMPUTING
BASIC AND DILUTED NET LOSS
PER SHARE		48,206,454			4,901,758			4,650,000

* In the year ended December 31, 2007 - includes $110 share-based compensation.
** Representing an amount less than $0.01

The accompanying notes are an integral part of the consolidated financial statements.

F-6

GLOBAL ENERGY INC.
(A development stage company)
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (CAPITAL DEFICIENCY)

															Deficit			Deficit
															accumulated			accumulated
					Additional				Share			Receivables			during the			before the
	Share capital				paid-in				Subscription			in respect of			development			development
	Number		Amount		capital		Warrants		received			shares issued			stage			stage			Total
			In thousands
BALANCE AT JANUARY 1, 2005	4,650,000	$	5	$	105												$	(109	)	$	1
CHANGES DURING THE YEAR,
ENDED DECEMBER 31, 2005
Net income (loss) for the year														$	(30	)		36			6
BALANCE AT DECEMBER 31,
2005	4,650,000		5		105										(30	)		(73	)		7
CHANGES DURING THE YEAR,
ENDED DECEMBER 31, 2006
Issuance of shares	1,331,764		1		12			$	4												17
Net loss for the year															(69	)					(69	)
BALANCE AT DECEMBER 31,
31, 2006	5,981,764		6		117				4						(99	)		(73	)		(45	)
CHANGES DURING THE YEAR
ENDED DECEMBER 31,
2007:
net of
Issuance of warrants						$	246														246
Issuance of shares	57,206,000		57		515				(4	)		(150	)								418
Net loss for the year															(1,665	)					(1,665	)
Share based compensation
expenses					110																110
BALANCE AT DECEMBER 31,
2007	63,187,764	$	63	$	742	$	246	$	-		$	(150	)	$	(1,764	)	$	(73	)	$	(936	)

The accompanying notes are an integral part of the consolidated financial statements.

F-7

GLOBAL ENERGY INC. 
(A development stage company)
CONSOLIDATED STATEMENTS OF CASH FLOWS

											Cumulative
											from July 7,
											2005 through
		Year ended December 31									December 31,
		2007			2006			2005			2007
		In thousands
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) for the period	$	(1,665	)	$	(69	)	$	6		$	(1,764	)
Adjustments required to reconcile net income (loss)
to net cash used in operating activities:
Depreciation		2						1			2
Capital gain of disposal of property and equipment								(38	)
Share based compensation expenses		110									110
Expenses in respect of the convertibles debentures		74									74
Decrease (Increase) in other accounts receivable		(187	)					16			(187	)
Increase in balance with minority shareholder		(2	)								(2	)
Increase in accounts payables		173									173
Increase (decrease) in other accounts payable-other		317			(8	)		(12	)		296
Net cash provided by (used in) operating activities		(1,178	)		(77	)		(27	)		(1,298	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net proceeds from sale of petroleum and natural								50
gas resource properties
Lease deposits		(18	)								(18	)
Payment for purchasing of property and equipment		(525	)								(525	)
Net cash used in investing activities		(543	)					50			(543	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of shares		390			17						407
Proceeds from debt issuance					46						46
Proceeds from issuance of convertible debentures and
warrants net of issuance expenses		2,790									2,790
Net cash provided by financing activities		3,180			63						3,243
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS		1,459			(14	)		23			1,402
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD		11			25			2			68
CASH AND CASH EQUIVALENTS AT END OF
PERIOD		1,470		$	11		$	25		$	1,470
NON-CASH TRANSACTION -
Conversion of promissory note into shares, see note 10a	$	28

The accompanying notes are an integral part of the consolidated financial statements.

F-8

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES:

a.	General
	Global Energy Inc. ("the Company") was incorporated under the laws of the State of Nevada on February 16, 1999.
	In July 6, 2005, the Company completed the sale all of its oil and gas assets for the sum of $50,000. The sale of these oil and gas assets was completed on July 6, 2005.
	Subsequent to the disposal of the Company’s principal operation – petroleum and natural gas resource properties, the Company is considered as a development stage enterprise since July 7, 2005, as defined by Statement of Financial Accounting Standards (“SFAS”) No. 7 - “Accounting and Reporting by Development Stage Enterprise”. The accompanying financial statements have disclosed cumulative amounts in the statements of operations and cash flows since July 7, 2005, inception of becoming a development stage company, until December 31, 2007.
	During May 2007 the Company established two subsidiaries in Israel: Global Fuel Israel Ltd (“Fuel”) a fully owned and Global N.R.G. Pacific Ltd. (“Pacific”) which the Company own 50.1%. On October, 2007, Pacific established a subsidiary in Ethiopia named Global Energy Ethiopia PLC (“Global Ethiopia”). Pacific and its consolidated company are acting as the agriculture arm of the Company's activities in the Bio Diesel field.
	In May 2, 2007 the Company entered into an agreement with AlphaKat GmbH (“AlphaKat”) in order to cooperate in commercialization of AlphaKat's technology of producing mineral diesel oil from municipal waste using machines which converts hydrocarbon waste into diesel oil invented for that purpose by AlphaKat ("KDV machines"). As to commitments of the Company to Alphakat, see note 9b. In July 10, 2007 the Company entered into an agreement with AlphaKat to incorporate and operate a company, named AlphaKat - Global Energy GmbH (“AGEI”). Each party holds 50% of the shares of AGEI. AGEI is to provide worldwide marketing and sales of KDV machines in consideration of 10% sale commission. The Company is responsible to finance AGEI, if such financing will be required AlphaKat has the right to object to any sale of KDV machines. The Company has consolidated AGEI in accordance with FIN 46R "Consolidation of Variable Interest Entities, an interpretation of ARB no. 51". See d, below. After the balance sheet date AGEI entered into its first agreement, see note 13a.
b.	Functional Currency
	The currency of the primary economic environment in which the operations of the Company are conducted is the U.S dollar (“$” or “dollar).
	Most of the Company’s expenses are incurred in dollars. A significant part of the Company’s external financing is in dollars. The Company holds most of its cash and cash equivalents in dollars. Thus, the functional currency of the Company is the dollar.

F-9

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (continued):

	Since the dollar is the primary currency in the economic environment in which the Company operates, monetary accounts maintained in currencies other than the dollar are remeasured using the representative foreign exchange rate at the balance sheet date. Operational accounts and nonmonetary balance sheet account are measured and recorded at the rate in effect at the date of transaction. The effects of foreign currency remeasurement are reported in current operations (as “financial EX- net) and have not been material to date.
c.	Going concern considerations
	As of December 31, 2007, the Company had negative working capital of $1,479 thousands and an accumulated deficit of approximately $1,837 thousands. The Company's ability to continue to operate as a going concern is dependent on its ability to generate sufficient cash flows to meet its obligations on a timely basis, to obtain additional financing and to ultimately attain profitability. The Company has no revenues and has incurred losses and an accumulated deficit resulting from the Company’s activity as a development stage company and has a negative cash flow from operating activities. In the event the Company is unable to successfully raise capital and generate revenues, it is unlikely that the Company will have sufficient cash flows and liquidity to finance its business operations as currently contemplated. There can be no assurance that additional funds will be available on terms acceptable to the Company, or at all. These conditions raise substantial doubt about the Company's ability to continue to operate as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effect on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.
d.	Principles of consolidation
	The consolidated financial statements include the accounts of the Company and its subsidiaries mentioned above, and the accounts of the 50% owned entity (AGEI) which according to FIN 46R is a variable interest entity and the Company is the primary beneficiary.
	Intercompany balances and transactions have been eliminated upon consolidation.
e.	Cash equivalents
	Cash equivalents are short-term highly liquid investments which include short term bank deposit (up to three months from date of deposit), that are not restricted as to withdrawals or use that are readily convertible to cash with maturities of three months or less as of the date acquired.
f.	Property and equipment
	Property and equipment are stated at cost, less accumulated depreciation. Assets are depreciated using the straight-line method over their estimated useful lives.
	The annual depreciation set as follows: leasehold improvements are amortized over the term of the lease which is shorter than the estimated useful life of the improvements. Computers, software and electronic equipment are depreciated over three years.

F-10

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (continued):

g.	Impairment of long-lived assets
	The Company's long-lived assets are reviewed for impairment in accordance with Statement of Financial Accounting Standard No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS No. 144") whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value. During the years ended December 31, 2007, 2006 and 2005, no impairment losses have been identified.
h.	Use of estimates
	The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

i.	Derivative financial instruments (“derivatives”)
	The Company has adopted FAS 133, as amended, which establishes accounting and reporting standards for derivatives, including certain derivatives embedded in other contracts, and for hedging activities. Under FAS 133, all derivatives are recognized on the balance sheet at their fair value. On the date that the Company enters into a derivative contract, it designates the derivative, for accounting purposes, as: (1) hedging instrument, or (2) non-hedging instrument. Any changes in fair value are to be reflected as current gains or losses or other comprehensive gains or losses, depending upon whether the derivative is designated as a hedge and what type of hedging relationship exists. Changes in fair value of non-hedging instruments are carried to “financial expenses-net” on a current basis. To date, the Company did not have any contracts that qualify for hedge accounting under FAS 133.
	The Company entered into convertible debentures agreement in which a derivative instrument is “embedded”. Embedded derivative is separated from the host contract and carried at fair value when (1) the embedded derivative possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract and (2) a separate, stand-alone instrument with the same terms would qualify as a derivative instrument.
	As to embedded derivatives arising from the issuance of convertible debentures, see note 8.

F-11

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (continued):

j.	Share-based payment
	The Company implements Statement of Financial Accounting Standards No. 123 (revised 2004) “Share-based Payment” (“FAS 123(R)”). FAS 123(R) requires awards classified as equity awards be accounted for using the grant-date fair value method. The fair value of share-based payment transactions is recognized as expense over the requisite service period, net of estimated forfeitures. The Company recognizes compensation cost for an award with only service conditions that has a graded vesting schedule using the accelerated method based on multiple options awarded approach.
	The Company accounts for equity instruments issued to third party service providers (non- employees) in accordance with the fair value based on an option-pricing model, pursuant to the guidance in EITF 96-18 “Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling Goods or Services”. The fair value of the options granted is revalued over the related service periods and recognized over the vesting period.
k.	Income loss per share
	Net income (loss) per share, basic and diluted, is computed on the basis of the net income (loss) for the period divided by the weighted average number of shares of common shares outstanding during the period. Diluted net loss per share is based upon the weighted average number of shares of common shares and of common shares equivalents outstanding when dilutive. Common shares equivalents include: (i) outstanding stock options under the Company’s Long-Term Incentive Plan and warrants which are included under the treasury share method when dilutive, and (ii) Common shares to be issued under the assumed conversion of the Company’s outstanding convertible Debentures, which are included under the if-converted method when dilutive. The computation of diluted net loss per share for the years ended December 31, 2007, 2006, and 2005 does not include common share equivalents, since such inclusion would be antidilutive. Disclosures required by SFAS 128, Earnings per Share, have been included in Note 11.
l.	Deferred income taxes
	Deferred taxes are determined utilizing the asset and liability method based on the estimated future tax effects of differences between the financial accounting and tax basis of asset and liabilities under the applicable tax laws. Deferred tax balances are computed using the tax rates expected to be in effect when these differences are reversed. A full valuation allowances is provided for, since based upon the weight of available evidence, it is more likely than not that all of the deferred tax assets will not be realized. See note 10.

F-12

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (continued):

m.	Uncertainty in income taxes
	As of January 1, 2007, the Company adopted FASB Interpretation No. 48, ‘‘Accounting for Uncertainty in Income Taxes - an Interpretation of FASB Statement No. 109’’ (‘‘FIN 48’’). FIN 48 specifies how tax benefits for uncertain tax positions are to be recognized, measured and derecognized in financial statements; requires certain disclosures of uncertain tax positions; specifies how reserves for uncertain tax positions should be classified on the balance sheet; and provides transition and interim-period guidance, among other provisions. On May 2, 2007, the FASB issued FASB Staff Position No. FIN 48-1, ‘‘Definition of Settlement in FASB Interpretation No. 48-1’’ (‘‘FSP FIN 48-1’’). FSP FIN 48-1 provides guidance regarding how an entity should determine whether a tax position is effectively settled for the purpose of recognizing previously unrecognized tax benefits. The Company adopted FSP FIN 48-1 as of January 1, 2007. The adoption of FIN 48 did not result in any adjustment to the Company’s financial statements.
n.	Comprehensive income (loss)
	The Company has no component of comprehensive income (loss) other than net income (loss).
o.	Newly issued accounting pronouncements
	1)	In December 2007, the FASB issued Statement of Financial Accounting Standards No. 141 (revised 2007), "Business Combinations" ("SFAS 141(R)". SFAS 141(R) changes the accounting for business combinations, including the measurement of acquirer shares issued in consideration for a business combination, the recognition of contingent consideration, the accounting for contingencies, the recognition of capitalized in-process research and development, the accounting for acquisition-related restructuring cost accruals, the treatment of acquisition related transaction costs and the recognition of changes in the acquirer’s income tax valuation allowance and income tax uncertainties. SFAS 141(R) applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008 . Early application is prohibited. The Company will be required to adopt SFAS 141(R) on January 1, 2009.

F-13

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (continued):

2)	In December 2007, the FASB issued FAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements - an amendment of Accounting Research Bulletin No. 51” (“FAS No. 160”). FAS No. 160 establish accounting and reporting standards for non-controlling interests in a subsidiary and deconsolidation of a subsidiary. Early adoption is not permitted. As applicable to the Company, these statements will be effective as of the year beginning January 1, 2009. The Company is currently evaluating the potential impact, if any, the adoption of FAS No. 160 would have on its consolidated financial statements.
3)	In September 2006, the FASB issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”). SFAS 157 defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years (January 1, 2008, for the Company). The Company is currently assessing the impact that SFAS 157 may have on its results of operations and financial position.
4)	In February 2007, the FASB issued Statement of Financial Accounting Standards No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities— Including an amendment of FASB Statement No. 115” (“SFAS 159”). SFAS 159 is expected to expand the use of fair value accounting but does not affect existing standards which require certain assets or liabilities to be carried at fair value. The objective of SFAS 159 is to improve financial reporting by providing companies with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. Under SFAS 159, a company may choose, at its initial application or at other specified election dates, to measure eligible items at fair value and report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date. SFAS 159 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years (January 1, 2008, for the Company). If the Company is to elect the fair value option for its existing assets and liabilities, the effect as of the adoption date, shall be reported as a cumulative-effect adjustment to the opening balance of retained earnings. The Company is currently assessing the impact that SFAS 159 may have on its financial position.
5)	In December 2007, the FASB ratified EITF Issue No. 07-01, "Accounting for Collaborative Arrangements" ("EITF 07-01"). EITF 07-01 defines collaborative arrangements and establishes reporting requirements for transactions between participants in a collaborative arrangement and between participants in the arrangement and third parties. EITF 07-01 also establishes the appropriate income statement presentation and classification for joint operating activities and payments between participants, as well as the sufficiency of the disclosures related to these arrangements. EITF 07-01 is effective for fiscal years beginning after December 15, 2008 (January 1,

F-14

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (continued):

2009, for the Company). EITF 07-01 shall be applied using modified version of retrospective transition for those arrangements in place at the effective date. An entity should report the effects of applying this Issue as a change in accounting principle through retrospective application to all prior periods presented for all arrangements existing as of the effective date, unless it is impracticable to apply the effects the change retrospectively. The Company is currently assessing the impact that EITF 07-01 may have on its results of operations and financial position.

NOTE 2 - OTHER ACCOUNTS RECEIVABLE:

		December 31,
		2007
		In thousands
Other receivable	$	120
Governmental Institutions		21
Prepaid expenses		46
	$	187

NOTE 3 - PROPERTY AND EQUIPMENT:

		December 31,
		2007
		In thousands
Cost:
Advances on account of
acquisition of Machinery	$	488
Computer software and electronic equipment		24
Leasehold improvements		13
		525
Less, accumulated depreciation and amortization		2
	$	523

NOTE 4 - ACCOUNTS PAYABLE - OTHER:

		December 31,
		2007
		In thousands
Accrued expenses	$	234
Employees and payroll accruals		80
Government authorities		3
	$	317

F-15

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 5 - ADVANCE TO MINORITY SHAREHOLDER

In July 10, 2007 the Company entered into an agreement with AlphaKat to incorporate and operate AGEI see note 1a. According to the agreement the Company has provided a loan to the shareholders of the AlphaKat. The terms of the loan has not yet been set.

NOTE 6 - DEMAND LOAN PAYABLE - RELATED PARTIES

The Company borrowed $18,000 from four shareholders of the Company on May 4, 2006. The loans are unsecured, non-interest bearing and due on demand.

NOTE 7 - FINANCIAL EXPENSE (INCOME)

		December 31,
		2007
		In thousands
Interest on convertible debentures (see note 8)	$	160
Income from evaluating the conversion option
fair value of the (see note 8)		(86	)
Other		2
	$	76

F-16

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 8 - CONVERTIBLE DEBENTURES AND WARRANTS

In July 2007, the Company entered into an agreement to issue in four different installments, as set in the agreement, $4 million aggregate principal amount of convertible debentures (“Debentures”) in a private placement. As of December 31, 2007 three installments in the sum of $3 million principal were issued for consideration of $2.8 million. The last installment is due after a registration statement for the underlying shares is declared effective by the SEC. The Debentures bear interest at 10% per annum, the payments of the principals and interest will commence on July 31, 2008 and continuing on each successive month thereafter until October 2010. The Debentures are convertible, at the option of the holder at any time, into shares of the Company’s Common Stock at a conversion price of $2.2 per share. The Company has the right to redeem a portion or all amounts outstanding prior to maturity date, provided that (1) the closing Bid price is less than the conversion price, (2) the underlying shares registration statement is effective and (3) no event of default has occurred.

If any event of default occurred, the full unpaid Principal amount of this Debenture, together with interest shall become at the investor's election, immediately due and payable in cash. In conjunction with this financing, the Company issued to the private investor 300,000 warrants to purchase 300,000 common shares of the Company, exercisable for five years at an exercise price of $2.35 and 300,000 warrants to purchase 300,000 common shares of the Company, exercisable for five years at an exercise price of $2.50. The conversion of the debentures and the exercise of the warrants are subject to further adjustments and condition as further set out in the Debenture Agreement. The conversion option included within each of the Company’s convertible debenture does not meet all the conditions of EITF 00-19 “Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company's Own Stock” related to equity classification and therefore should be bifurcated from the debt host contract. In addition the put option and call option are considered as embedded derivatives that require bifurcation, therefore these instruments are evaluated each reporting period and the difference in fair value is recorded as financial income or expense, see note 7 above. The Company measured the fair value of the embedded derivatives features on the issuance date at approximately $1,032 thousands. The amount attributed to the warrants was $246 thousands, the remaining $1,425 thousands was allocated to the debentures.

As of December 31, 2007, none of the warrants were exercised and none of the debentures were converted into share.

Following are the details of the convertible debentures:

		December 31,
		2007
		In thousands
Principal	$	1,426
Accrued interest		160
Conversion option		1,032
Put option		*
Call option		*
	$	2,618

* Representing an amount less than $1,000

The notes are secured by a pledge on all of the Company's assets.

F-17

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 9 - COMMITMENTS AND CONTINGENCIES:

a.	Fuel currently leases office in Tel Aviv, Israel, under operating lease agreement, which expire at 2009. The monthly rent is approximately $3,800.
b.	Under the agreement signed with Alphakat with regard to commercialization of AlphaKat technology of producing mineral diesel oil from municipal waste the Company agreed to: 1) Provide financial support for the project, 2) Purchase three KDV 500 turbines for implementation in Poland, the United States and Israel, 3) Start a regulatory process, including filing of permit applications and 4) Monthly payments Euro €10,000 to AlphaKat for consulting.
c.	On October 5, 2007, Global Ethiopia, entered into lease agreements with the Southern Nations Nationalities People's Regional State, Ethiopia, or SNRS, for a 50 year lease of 20,000 hectares of rural land located in the Gamo Gofa zone in the SNRS for the purpose of cultivating castor seeds and 15 hectares of land located in the Gamu Gofa zone, Kucha Woreda, in the SNRS for the purpose of operating an oil crushing plant through an existing facility on the property.
	The agreements are subject to, among other things, the following conditions: (i) Global Ethiopia must pay SNRS a rental fee of Birr 47 (approximately US$5) or Birr 78 (approximately US$8.50) per hectare per year, depending on whether the leased land is defined as second or first class land, respectively; (ii) Global Ethiopia must completely develop the 20,000 hectares leased to it within eight years of the execution date of the agreement, including planting and maintaining trees or other oil producing crops. If no development process is carried out within a period of four (4) years from the date of execution of the agreement, then the undeveloped land may be repossessed by SNRS by giving six (6) months advance written notice to abandon the land; (iii) Global Ethiopia must completely develop the 15 hectares leased to it within three years of the execution date of the agreement; (iv) Global Ethiopia must perform a survey on the 20,000 hectares within 24 months of the execution date of the agreement; Global Ethiopia has also an option to lease additional farmland from the SNRS during the term of the lease agreement (up to an additional 100,000 hectares of farmland) on the same terms as the lease agreement for the 20,000 hectares; and Global Ethiopia is not required to make any rental payments on its 20,000 hectare lease agreement until the fourth year of the agreement. During the term of the lease agreements, SNRS may cancel the lease due to failure of Global Ethiopia to discharge its material obligations under the lease agreements, provided, however, that Global Ethiopia is given one year prior notice and fails to cure such failure within such one year period.
	As of December 31, 2007, none of the conditions were met.
d.	In October 20, 2007 the Company entered into an agreement for consulting services with Trianon Partners ("Trianon") and as of October 24, 2007 the Company entered into a Joint Development Agreement with Trianon. In consideration of the consulting services to be provided by Trianon, the Company agreed to pay Trianon a fixed fee of $250 thousands which is to be paid in $10,000 monthly installments once the Company determines to commence the construction of the plant with the balance to be paid upon mechanical completion of the plant. In the consideration of the Joint Development the Company agreed to grant an exclusive license to Trianon, throughout the states of Texas, New York and New Jersey to be formed with AlphaKat, to market systems that use a proprietary

F-18

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 9 - COMMITMENTS AND CONTINGENCIES (continued):

biodiesel technology for the conversion of waste to biodiesel. The aforementioned agreement was terminated in the Company executed a business and development agreement with ("Renewable"), an affiliate of Trianon and of American Renewable Diesel, LLC ("American"), see also note 13a.

NOTE 10 - SHARE CAPITAL:

a.	Common shares
	Common stock confers on its holders the right to receive notice to participate and vote in general meetings of the Company, the right to a share in the excess of assets upon liquidation of the Company, and the right to receive dividends, if declared.
	In October 24, 2006, the Company issued 1,331,764 common shares at a price per share of $0.01 for an aggregate consideration of $13,000.
	On February 7, 2007, the Company issued 17,031,000 common shares at a price per share of $0.01 for consideration of approximately $170 thousands.
	On April 30, 2007, the Company issued a total of 40,175,000 common shares at a price per share of $0.01 for consideration of approximately $402 thousands of which approximately $47,000 was paid in cash, $28,000 was paid by conversion of $28,000 promissory note and approximately $327 thousands was paid via the issuance of non interest notes receivables having maturities up to one year. As at December 31, 2007, $150 thousands have not been yet collected.
	As to the issuance of warrants, see note 8.
b.	Stock option plan
	In 2007, the Company established the 2007 share option plan, which provides for the issuance of up to 8,500,000 of the Company's common shares.
	In April 2007 the Company granted 5,055,021 stock options exercisable for ten years at an exercise price of $0.01 per share, to the CEO, the options vest in four equal batched over a period of four years from the date of the option, provided that the CEO is still the Company's employee. No option was vested as to year end. The Company estimates the fair value of stock options granted using the Black-Scholes option-pricing model. The option-pricing model requires a number of assumptions, of which the most significant are, expected stock price volatility, and the expected option term.

F-19

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 10 - SHARE CAPITAL (continued):

Expected volatility was based on the average of similar companies in the market due to insufficient trade volume. The expected option term represents the contractual period of the stock options as defined in the option agreement. The Company has historically not paid dividends and has no foreseeable plans to issue dividends. Risk-free interest rates, which are based on quoted H15 report of the Federal Reserve Board.

The fair value of the Company's stock options granted to the CEO was estimated using the following weighted average assumptions:

Risk free interest	4.63%
Dividend yields	0
Volatility	250%
Expected term (in years)	10

The fair value of the options granted to the CEO using the Black&scholes model is $0.01 per option.

In May 7, 2007 the Company granted 400,000 warrants to a service provider for Investor Relations and Marketing Advisor services. 200,000 warrants are exercisable immediately at an exercise price of $0.01 per share. 200,000 additional options were intended to vest effective May 1, 2008, on a pro rata basis in the event the employment agreement terminated before May 1, 2008. The agreement with the service provider was terminated as of January 1, 2008, and as of the December 31, 2007, 350,000 warrants were vested and exercisable at an exercise price of $0.01 per share, the market value of the share we used in the calculation of the fair value as of the year end was $0.6. The fair value of the abovementioned warrants calculated amounted to $92,000. This fair value was estimated using the following weighted average assumptions:

Risk free interest	3.34%
Dividend yields	0
Volatility	250%
Expected term (in years)	Less than a year

As of December 31, 2007 no options or warrants were exercised.

As of December31, 2007, there were $33 thousands of total unrecognized compensation expenses related to unvested share based compensation arrangement granted under the plan.

As to options granted after balance sheet date, see note 13b.

F-20

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 11 - INCOME TAXES

In 2007 and 2006 the Company incurred net operating loss for tax purposes and recognized a full tax valuation against deferred taxes. Accordingly, no provision or benefit for income taxes has been recorded in the accompanying financial statements.

The tax effect of net operating loss carry forward as of December 31, 2007 and 2006 was as follows:

		2007			2006
Deferred tax assets:
Net operating loss carry-forward	$	484		$	60
Valuation allowance		(484	)		(60	)
	$	0		$	0

The Company is primarily subject to U.S. federal income tax. For all years presented effective income tax rate is zero. The difference between the Company’s effective income tax rate and the statutory rate of 35% is attributable to an increase in the deferred tax valuation allowance.

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. As of January 1 and December 31, 2007, the Company had no accruals for interest or penalties related to income tax matters.

As of December 31, 2007, the Company had available for tax purposes unused net operating loss carry-forwards of $1,412. $1,101 will expire in various years from 2019 to 2027.

NOTE 12 - NET LOSS PER SHARE DATA

The Company’s basic net loss per share amounts has been computed by dividing net loss by the weighted average number of Common outstanding. In 2007, 2006, and 2005, the Company reported net losses; therefore, no common stock equivalents were included in the computation of diluted net loss per share since such inclusion would have been antidilutive. The calculations of basic and diluted net loss per share are as follows:

		December 31
		2007		2006		2005
Net loss, in thousands (Numerator)	$	1,665	$	69	$	(6	)
Weighted-average shares, in thousands (Denominator)		48,206		4,902		4,650
Basic and diluted net loss per share	$	0.03	$	0.01	$	0.00

F-21

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 12 - NET LOSS PER SHARE DATA (continued):

The shares issuable upon the exercise of options, and conversion of convertible debentures and warrants, which have been excluded from the diluted per share amounts because their effect would have been antidilutive, include the following:

		December 31,
		2007
Options:
Weighted average number, in thousands		3,370
Weighted average exercise price	$	0.01
Warrants:
Weighted average number, in thousands		542
Weighted average exercise price	$	0.81
Convertible Debt:
Weighted average number, in thousands		263
Conversion price	$	2.2

NOTE 13 - SUBSEQUENT EVENTS:

a.	In February 6, 2008, The Company entered into a business and royalty agreement with Covanta Energy Corporation ("Covanta"), under which the Company granted to Covanta certain rights, both exclusive and non-exclusive, for the use, practice, and improvement of the KDV technology for the purpose of converting waste materials containing hydrocarbons into diesel oil in countries including the US, the UK, China and the Republic of Ireland. The Company has certain rights to pursue specified small scale projects using the technology. Covanta will have the option to invest in, as well as the Company retention of the right to invest 10% - 35% of the equity in projects initiated by Covanta. Covanta agreed to pay the Company a royalty equal to 10% of the gross revenues derived from the sale of diesel oil from each project for a period of 20 years from the date the applicable project achieves commercial operation. Under the agreement, Covanta shall also be responsible for financing 100% of the costs of erection of a demonstration plant, which it may disassemble and make available for pick up by us, at no cost to us, upon Covanta terminating its rights to the technology.
	On the same day, the Company entered into a license agreement with Covanta under which the Company granted it a right to sell systems based on the technology to governmental organizations subject to certain pre-conditions regarding the purchase of a minimum number of systems based on the technology. Covanta's rights under both the license agreement and the business and royalty agreement shall be non-exclusive until it has (i) issued a purchase order for a demonstration plant, and (ii) placed purchase orders for five additional systems. AlphaKat- Global Energy GmbH will receive a 10% commission from the sale of all systems, part of which shall be payable to American, subject to the business and development agreement described below.
	In February 6, 2008, the Company executed a business and development agreement with Renewable, an affiliate of Trianon and of American, under which both Renewable and the Company shall have the right to identify and develop certain projects to convert feedstock to diesel using the KDV technology in New York,

F-22

GLOBAL ENERGY INC.
(A development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 13 - SUBSEQUENT EVENTS (continued):

	California and Texas, as well as Florida and New Jersey under certain conditions. If the Company identifies a project, Renewable shall be entitled to invest up to 25% of the total required equity. If Renewable identifies a project, the Company shall be entitled to invest up to 51% and Covanta will be entitled to invest up to 24% of the total required equity. In all projects, Renewable shall manage the projects and shall be entitled to development fees in the amount of $100 thousands for each KDV500, up to a maximum total of $2,000, according the number of KDV 500 system included in the project.
	In connection with the business and development agreement described above, AlphaKat-Global Energy GmbH executed a license agreement with Renewable granting certain exclusive rights to market and sell systems based on the technology in the territory of California, New York and Texas, as well as New Jersey and Florida, subject to the satisfaction of minimum sales requirements. The territory may be reduced and/or exclusive rights may become non-exclusive rights, depending on whether minimum sale requirements are satisfied. American is to receive a commission on all sales in the territory. Systems sold to Covanta shall be credited to American, regardless of whether such systems are for use inside or outside the territory.
b.	In January 31, 2008 the Board of Directors approved the following options grants: 1,150,000 to three directors (350,000 options each) pursuant to the Company director compensation plan, at an exercise price of US $2.2 per share, and 1,150,000 incentive options granted to executive officer pursuant to an employment agreement effective November 1, 2007.
c.	On March 20, 2008, the Company signed an amendment to the debentures agreement described in note 8. The Company agreed to amend certain sections of the agreement dated July 2007 as follows:
	•	The private investor agreed to purchase $0.5 million of convertible debentures prior to a registration statement for the underlying shares is declared effective by the SEC and the additional $0.5 million once it become effective;
	•	The conversion price has been changed from $2.20 to $1.25 for all debentures outstanding;
	•	The exercise price has been changed from $2.50 and $2.35 to $1.25 for all warrants granted.

_____________________
____________________________________
_____________________

F-23

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

            None.

Item 9A(T). Controls and Procedures

           (a)       Our management, including our chief executive officer and chief financial officer, has evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2007. Based on such review, our chief executive officer and chief financial officer have determined that in light of their conclusion with respect to the effectiveness of our internal control over our financial reporting as of such date, we didn’t have in place effective controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure, and is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms.

           (b)       Our management, under the supervision of our chief executive officer and chief financial officer, is responsible for establishing and maintaining adequate internal control over our financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934, as amended. The Company’s internal control over financial reporting is defined as a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Internal control over financial reporting includes policies and procedures that:

• pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and asset dispositions;

• provide reasonable assurance that transactions are recorded as necessary to permit the preparation of our financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

• provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on our financial statements.

           Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we evaluated the effectiveness of our internal control over financial reporting as of December 31, 2007 based on the framework for Internal Control-Integrated Framework set forth by The Committee of Sponsoring Organizations of the Treadway Commission. Due to the inherent limitations of our company, derived from our small size and the small number of employees, management evaluation concluded that there is a material weakness with respect to segregation of duties that may not provide reasonable assurance regarding the reliability of internal control over financial reporting and may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

           Based on this evaluation, our management concluded that there is no reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and that the Company’s internal controls over financial reporting were not effective as of December 31, 2007.

           Subsequent to December 31, 2007, management, including our principal executive officer and principal financial officer, has started an extensive process in order to strengthen our internal controls over financial reporting in order to reasonably ensure that reliability of financial reporting and the preparation of financial statements.

           This management report on internal control over financial reporting shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended or otherwise subject to the liabilities of that Section.

           This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Commission that permit us to provide only management’s report in this Annual report.

           (c)       There were no changes in our internal controls over financial reporting identified with the evaluation thereof that occurred during the quarter ended December 31, 2007 that have materially affected, or are reasonable likely to materially affect our internal control over financial reporting.

Item 9B. Other Information

            None.

20

PART III

Item 10. Directors, Executive Officers and Corporate Governance

Executive Officers and Directors

The following table sets forth information regarding our directors, executive officers and key employees, including their ages as of March 14, 2008.

Name	Age	Position
Directors and Executive Officers
Asi Shalgi	54	President, Chief Executive Officer, Secretary and Director
Alex Werber	52	Treasurer and Chief Financial Officer
Yair Aloni (1)	58	Director
Josef Neuhaus (2)	44	Director
Avner Raanan (3)	57	Director
Key Employees
Yossi Raz	60	Vice President for Project Development and Chief Technology Officer
Yanai Man	49	Chief Executive Officer of Global NRG Pacific and Global Energy Ethiopia

(1)	Chairman of the Compensation Committee
(2)	Chairman of the Audit Committee and member of the Compensation Committee
(3)	Member of the Audit Committee and the Compensation Committee

           Asi Shalgi. Mr. Shalgi has served as our President, Chief Executive Officer and director since April, 2007. He has more than 20 years of experience and involvement in the private and public sector. He has served as general manager and director for industrial and agriculture companies with significant export activities. He was the director general of the Israeli Ministry of Energy and Infrastructure. During his term with the Ministry he was involved in the peace treaty negotiations with Jordan on the energy annex. He was responsible for new legislation regarding electricity in Israel that allowed the involvement of Independent Power Producers and the implementation of the Public Utility Authority that regulates the energy sector and prices in Israel. He has been involved in the power and water sector mainly in developing and financing IPP projects. This has included developing, financing, building and operating the first private power plant in Israel, and the first private water desalination plant in Israel. He served in the IDF and retired as a Lieutenant Colonel. Mr. Shalgi received an Engineering degree for industrial and management from the Tel Aviv University.

           Alex Werber. Mr. Werber has served as our Treasurer and Chief Financial Officer since May, 2007. He is a certified public accountant with over 15 years of financial management experience in privately held and publicly traded companies. He has served as controller and chief financial officer for several public companies since 1983. During the past decade he specialized in the hi-tech sector, serving in managerial positions including controller, VP Finance and chief financial officer. He received a B.A. in Economics and Accounting from Tel Aviv University, where he completed post-graduate studies in Accounting.

           Yair Aloni. Mr. Aloni has served as our director since November, 2007. He worked with an international trading and consulting company that provides marketing and sales services along with business consulting services. He has also served on the board of directors of a publicly listed biopharmaceutical company. Mr. Aloni attended the business management school at Tel Aviv University.

           Josef (Jos) Neuhaus. Mr. Neuhaus has served as our director since December, 2007. He has been an independent consultant since 2004. Mr. Neuhaus currently serves on the board of Gammacan International, Inc. (OTCBB: GCAN). From August, 2006 to February, 2007, Mr. Neuhaus served as Chief Financial Officer, Treasurer and Secretary of Advanced Technology Acquisition Corp. (Amex: AXC). Prior that, between August, 2005 and February, 2006, Mr. Neuhaus served as the Chief Financial Officer of Axis Mobile Ltd. (LSE: AXIS.L). From March, 2003 to November, 2003, he served as CEO of RoadEye FLR G.P., and Managing Director of Gintec Active Safety Ltd., both private companies dealing with collision avoidance systems. Mr. Neuhaus received both his M.B.A. and B.A. in Accounting and Economics from Tel Aviv University. He is an Israeli CPA.

           Avner Raanan. Mr. Raanan has served as our director since December, 2007. He has vast technical and managerial experience in venture capital investments, business consulting, managing multi-million dollar projects, developing airborne electronic warfare systems and air to air missiles. Mr. Raanan founded Avnan Enterprises Ltd., an investment company that invests in early stage start up companies. Mr. Raanan is currently a Ph.D. candidate at Bar-Ilan University, Israel. He received an M.Sc. in Business Administration and a B.Sc. in Electronic and Computer Engineering from Ben-Gurion University in Israel.

21

           Yossi Raz. Mr. Raz has served as our Vice President for Project Development and Chief Technology Officer since November, 2007. Prior to that, Mr. Raz served as a consultant for project development for the company. He has 37 years of experience in the private and public sector in Israel and internationally. He has served as managing director and deputy managing director for organizations in the heavy chemical and petrochemical industries as well as in the high-tech, energy, mining and infrastructure sectors. He was involved as a project manager in many multi million dollar turnkey projects around the world, utilizing innovative technologies and inventions. During his 37 years of experience, Mr. Raz performed engineering, procurement, construction and commissioning, marketing, business development and projects in countries such as the U.S.A, Costa Rica, Chile, Brazil, South Africa, Ivory Coast, Yugoslavia and Montenegro, Italy, Great Britain, China, Thailand, Poland, the Czech Republic, Turkey and Russia. He has experience in developing and producing business plans, techno-economical evaluations and other bankable documents. Mr. Raz is fluent in English, Hebrew and some German. He served in the Israeli army as chief electrician to the Naval Fleet, and retired at the rank of Major. Mr. Raz graduated as a Mechanical and Electrical Engineer from the Technion - Institute of Technology and received an M.B.A. in International Marketing at the University of Pretoria, South Africa.

           Yanai Man. Mr. Man has served as Chief Executive Officer of Global NRG Pacific Ltd. since June 6 2007 and Global Energy Ethiopia since October 1 2007. Prior to that Mr. Man served from 2003-2005 as Chief Executive Officer of the Ocean Rock Corporation, a factory, located in the Dominican Republic, which produces fine jewelry (diamonds, platinum and gold), and is a subsidiary of Paul Winston Jewelry Ltd. which is located in New York. From 1997 through 2003 he founded and served as Chief Executive Officer of Phytech Technologies Ltd, during which time he established three subsidiary companies that deal with high-tec, mid-tec and turnkey projects. Prior to that he founded and served as Chief Executive Officer or Manager of Pollinating Service Yad-Mordechai, Environment Acoustic – USA and Apiary Yad Mordechai (Michvarot Yad Mordechai). He served in the IDF and retired at the rank of Major.

Consultants

           We conduct, and intend to continue to conduct, some of our business through agreements with consultants.

Section 16(a) Beneficial Ownership Compliance

           Section 16(a) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, requires our executive officers and directors and persons who own more than 10% of a registered class of our equity securities to file with the Commission initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of our common stock and other equity securities, on Forms 3, 4 and 5 respectively. Executive officers, directors and greater than 10% shareholders are required by the Commission regulations to furnish us with copies of all Section 16(a) reports they file.

           Based solely on our review of the copies of such forms received by us, or written representations from certain reporting persons, we believe that all filing requirements applicable to our officers, directors and greater than ten percent beneficial owners were complied with, with the exception of the following:

Name	Number of Late Insider Reports	Number of Transactions Not Reported on a Timely Basis	Failure to File Requested Forms
Alex Werber	1	1	None

Committees of the Board

           Our company currently does not have a nominating committee nor does our company have a written nominating committee charter. Our board of directors does not believe that it is necessary to have such a committee because it believes that the functions of such a committee can be adequately performed by the board of directors.

           Our company does not have any defined policy or procedure requirements for shareholders to submit recommendations or nominations for directors. The board of directors believes that, given the early stages of our development, a specific nominating policy would be premature and of little assistance until our business operations develop to a more advanced level. Our company does not currently have any specific or minimum criteria for the election of nominees to the board of directors and we do not have any specific process or procedure for evaluating such nominees. The board of directors assesses all candidates, whether submitted by management or shareholders, and makes recommendations for election or appointment.

           A shareholder who wishes to communicate with our board of directors may do so by directing a written request addressed to our President at the address appearing under "Business–Corporate Overview".

Audit Committee

           The audit committee is comprised of Josef Neuhaus (chairman) and Avner Raanan. The audit committee assists the board of directors in discharging its responsibility relating to the accounting, reporting and financial practices of the Company and its subsidiaries, and has general responsibility for oversight of internal controls, accounting and audit activities and the legal compliance of the Company and its subsidiaries. The audit committee operates under a charter adopted by the board of directors.

22

Compensation Committee

           The compensation committee is comprised of Yair Aloni (chairman), Josef Neuhaus and Avner Raanan. The compensation committee assists the board of directors in discharging its responsibilities relating to compensation of the Company’s directors and executives. The primary objective of the committee is to develop and implement compensation policies and plans that are appropriate for the Company in light of all relevant circumstances, its level of operations and which provide incentives that further the Company’s long-term strategic plans and are consistent with the culture of the Company and the overall goal of enhancing enduring shareholder value. The compensation committee operates under a charter adopted by the board of directors.

Code of Ethics

           We have not yet adopted a corporate code of ethics. Given our current operations, management does not believe a code of ethics is necessary at this stage of our development.

Audit Committee Financial Expert

           Our board of directors determined that Mr. Josef Neuhaus qualifies as an "audit committee financial expert" as defined by Item 407(d) of Regulation S-K. Mr. Josef Neuhaus is an “independent director” as defined in NASDAQ Marketplace Rule 4200(a)(15).

Item 11. Executive Compensation

           The table set forth below summarizes the annual and long-term compensation for services payable to our executive officers during the fiscal years ended December 31, 2007 and 2006.

Summary Compensation

SUMMARY COMPENSATION TABLE
Name And Principal Position	Year	Salary ($)	Bonus ($)	Stock Awards ($)	Option Awards ($)	Non-Equity Incentive Plan Compensation ($)	Nonqualified Deferred Compensation Earnings ($)	All other Compensation	Total ($)
Asi Shalgi President, CEO and Director	2007 2006	115,259 (1) -	Nil -	Nil -	17,552 (2) -	Nil -	Nil -	Nil -	132,811 -
Alex Werber CFO(3)	2007 2006	30,000 -	Nil -	Nil -	Nil -	Nil -	Nil -	Nil -	30,000 -
Christopher Kape Former President, CEO, CFO, Secretary and Director (4)	2007 2006	63,195 Nil	Nil Nil	Nil Nil	Nil Nil	Nil Nil	Nil Nil	Nil $19,080 (5)	63,195 19,080

(1)	Including social benefits and reimbursement by our company of expenses paid by Asi Shalgi.
(2)	Expenses related to the authorizing for issuance 5,055,021 options to Asi Shalgi in accordance with US GAAP, which such options do not begin vesting until April 30, 2008.
(3)	Mr. Werber was appointed as our new Treasurer and Chief Financial Officer effective May 6, 2007.
(4)	Elected as director and appointed President, Chief Executive Officer, Secretary and Treasurer on April 5, 2005. As of November 5, 2007, Christopher Kape resigned as secretary and from our Board of Directors. As of May 6, 2007 Christopher Kape resigned as our Treasurer and Chief Financial Officer. As of April 30, 2007, Christopher Kape resigned as our President and Chief Executive Officer.
(5)	Charged by Jamco Capital Partners Inc., a private company owned by Christopher Kape, for office, secretarial and accounting services.

          Effective May 6, 2007, we appointed Alex Werber as our new Treasurer and Chief Financial Officer and entered into an employment agreement, pursuant to which it was agreed Mr. Weber should be employed on a part-time basis and paid a monthly salary, payable immediately upon receipt of his invoice, at a gross monthly rate of US $2,500, to be paid in NIS translated pursuant to the official representative rate of exchange of the US$ as published by the Bank of Israel on the payment date. Under the employment agreement, Mr. Werber and the Company agreed to open and maintain a study fund. We agreed to contribute to the fund an amount equal to 7.5% of each monthly salary payment up to the maximum amount recognized for tax benefits pursuant to the Income Tax Ordinance, and Mr. Werber agreed to contribute to the fund an amount equal to 2.5% of each monthly salary payment up to the maximum amount recognized for tax purposes pursuant to the Income Tax Ordinance. In addition, we agreed to provide Mr. Werber (including his heirs, executors and administrators) with coverage under a standard directors' and officers' liability insurance policy at our expense.

23

          On December 1, 2007, Mr. Werber’s employment agreement was amended, pursuant to which his salary was increased to a gross monthly salary of US $5,000. All other terms of the employment agreement remain unchanged and in full force and effect.

          On April 30, 2007, we appointed Asi Shalgi as our new President and Chief Executive Officer and entered into an employment agreement. Under the terms of the agreement, Asi Shalgi is being paid a monthly base salary of $10,000. In addition, on April 30, 2007, we granted 5,055,021 stock options exercisable for ten years at an exercise price of $0.01 per share to Asi Shalgi. Mr. Shalgi has also been appointed to our board of directors (for more details regarding his compensation as director see below, "Director Compensation Policy").

          On November 2, 2007, we elected Yehuda Eliraz and Yair Aloni to serve on our board of directors. On November 20, 2007, Yehuda Eliraz resigned from our board of directors. Our directors are entitled to compensation in accordance with our director compensation policy (See "Director Compensation Policy").

Outstanding Equity Awards at Fiscal Year-End

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
OPTION AWARDS						STOCK AWARDS
Name	Number of Securities Underlying Unexercised Options (#) Exercisable	Number of Securities Underlying Unexercised Options (#) Unexercisable	Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)	Option Exercise Price ($)	Option Expiration Date	Number of Shares or Units of Stock That Have Not Vested ($)	Market Value of Shares or Units of Stock That Have Not Vested ($)	Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)	Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested (#)
Asi Shalgi (1)	Nil	5,055,021	Nil	$0.01	April 30, 2017	Nil	Nil	Nil	Nil

(1) Asi Shalgi was granted 5,055,021 stock options on April 30, 2007 to vest at a rate of 25% per year beginning April 30, 2008. Effective January 31, 2008, the expiration date of the options was extended to April 30, 2017.

Director Compensation Policy

          On November 2, 2007, we adopted a director compensation policy for all the directors pursuant to which (a) we authorized the issuance to each of our directors 200,000 share options at an exercise price of $0.56 per share and (b) we agreed to pay a fee of US$750 per meeting for each quarterly board meeting attended and a fee of US$600 per month for all other meetings attended or consented to in writing by the entire board of directors. On November 18, 2007, the compensation policy was amended such that each director was authorized 350,000 at an exercise price of $2.20 per share, rather than 200,000 options at an exercise price of $0.56 per share. On January 31, 2008, the director compensation policy was further amended to provide for payment of $1,000 per month to each director as compensation, rather than a fee of $750 per meeting.

          On December 6, 2007, we appointed Josef Neuhaus and Avner Raanan to our board of directors. On January 31, 2008, we issued to each of Josef Neuhaus, Yair Aloni and Avner Raanan options to purchase 350,000 shares of our common stock at an exercise price of $2.20 per share. The stock options were issued in accordance with the terms of the 2007 share option plan to be exercisable until December 6, 2017.

DIRECTOR COMPENSATION (1)
Name	Fees Earned or Paid in Cash ($)	Stock Awards ($)	Option Awards ($)	Non-Equity Incentive Plan Compensation ($)	Non-Qualified Deferred Compensation Earnings ($)	All Other Compensation	Total ($)
Asi Shalgi	Nil	Nil	Nil (3)	Nil	Nil	Nil	Nil

24

DIRECTOR COMPENSATION (1)
Name	Fees Earned or Paid in Cash ($)	Stock Awards ($)	Option Awards ($)	Non-Equity Incentive Plan Compensation ($)	Non-Qualified Deferred Compensation Earnings ($)	All Other Compensation	Total ($)
Josef Neuhaus	806 (2)	Nil	Nil (4)	Nil	Nil	Nil	Nil
Avner Raanan	806 (2)	Nil	Nil (5)	Nil	Nil	Nil	Nil
Yair Aloni	1,933 (2)	Nil	Nil (6)	Nil	Nil	Nil	Nil

(1)	For the fiscal year ended December 31, 2007.
(2)	Amounts accrued, but unpaid, in the fiscal year ended December 31, 2007.
(3)	5,055,021 options were granted on April 30, 2007 but do not begin vesting until April 30, 2008. All 5,055,021 options were outstanding at fiscal year-end.
(4)	350,000 options were granted on January 31, 2008 and do not begin vesting until December 6, 2008. These options were not outstanding at fiscal year-end.
(5)	350,000 options were granted on January 31, 2008 and do not begin vesting until December 6, 2008. These 350,000 options were not outstanding at fiscal year-end.
(6)	350,000 options were granted on January 31, 2008 and do not begin vesting until December 6, 2008. These 350,000 options were not outstanding at fiscal year-end.

Equity Compensation Plan Information

          Our board of directors adopted an equity compensation plan, the 2007 Share Option Plan, on May 15, 2007, under which a total of 8,500,000 shares of our common stock have been authorized for issuance. The following summary information is presented for stock options authorized for issuance on an aggregate basis as of December 31, 2007.

Plan Category	Number of Securities to be issued upon exercise of outstanding options, warrants and rights. (a)	Weighted average exercise price of outstanding options, warrants and rights. (b)	Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a) (c)
Equity compensation plans approved by security holders	Not Applicable	Not Applicable	Not Applicable
Equity compensation plans not approved by security holders	5,455,021(1)	$0.01	3,044,979(2)

(1)

As of December 31, 2007, the following options have been issued and outstanding pursuant to an equity compensation plan: 5,055,021 options granted to Asi Shalgi pursuant to an option agreement dated April 30, 2007 and 400,000 options with an exercise price of $0.01 granted to Dr. Irit Arbel. In addition, options to purchase 2,200,000 shares of our common stock were authorized throughout 2007 and were granted on January 31, 2008. These options were not outstanding at fiscal year-end..

(2)

Options remaining available for future issuance under the 2007 share option plan, excluding securities reflected in column (a).

          The share option plan is administered by either our board of directors or a committee, consisting of such number of members (but no less than two (2)) as may be determined by our board of directors, to which the board of directors shall have delegated power to act on its behalf with respect to the share option plan. The administrator of the share option plan has full power and authority to select the individuals to whom awards will be granted, to make any combination of awards to participants, to accelerate the exercisability or vesting of any award, to provide substitute awards and to determine the specific terms and conditions of each award, subject to the provisions of the share option plan, our Articles of Association and any applicable law.

          The share option plan permits us to make grants of stock options to officers, employees, directors, consultants and other key persons. Stock options granted under the share option plan shall have an exercise price as determined by the administrator of the share option plan.

          In the event of a merger or sale of all or substantially all assets or shares of capital stock, the administrator at its sole discretion shall decide the treatment of the options in the sale event.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

          The following table provides certain information with respect to the beneficial ownership of our common stock as of March 14, 2008 for:

25

• each beneficial owner of more than 5% of our outstanding common stock;

• each of our executive officers;

• each of our directors; and

• all of our executive officers and directors as a group.

          In the following table, we have determined the number and percentage of shares beneficially owned in accordance with Rule 13d-3 of the Exchange Act based on information provided to us by our controlling shareholder, executive officers and directors, and this information does not necessarily indicate beneficial ownership for any other purpose. In determining the number of shares of our common stock beneficially owned by a person and the percentage ownership of that person, we include any shares as to which the person has sole or shared voting power or investment power, as well as any shares subject to warrants or options held by that person that are currently exercisable or exercisable within 60 days after March 14, 2008. Applicable percentages are based on 63,187,764 shares of common stock outstanding on March 14, 2008.

5% Beneficial Owners, Directors and Executive Officers:(1)	Shares Beneficially Owned
	Number	Percent(2)
Asi Shalgi (3)	--
		--
Alex Werber	--	--
Yair Aloni (4)	--
		--
Josef Neuhaus (5)	--
		--
Avner Raanan (6)	--
		--
Carrigain Investment Ltd. (7)	42,000,000	66.5%
All executive officers and directors as a group (5 persons)	--	--

(1)	Except as otherwise indicated, addresses are c/o Global Energy Inc., 415 Madison Avenue, 15th Floor, New York, NY 10017.
(2)	Based on 63,187,764 shares of our common stock issued and outstanding as of March 14, 2008. Beneficial ownership is determined in accordance with the rules of the Commission and generally includes voting or investment power with respect to securities. Except as otherwise indicated, we believe that the beneficial owners of shares of our common stock listed above, based on information furnished by such owners, have sole investment and voting power with respect to such shares, subject to community property laws where applicable.
(3)	None of the 5,055,021 options held by Asi Shalgi are currently exercisable or exercisable within 60 days of March 14, 2008.
(4)	None of the 350,000 options held by Yair Aloni are currently exercisable or exercisable within 60 days of March 14, 2008.
(5)	None of the 350,000 options held by Josef Neuhaus are currently exercisable or exercisable within 60 days of March 14, 2008.
(6)	None of the 350,000 options held by Avner Raanan are currently exercisable or exercisable within 60 days of March 14, 2008.
(7)	Carrigain Investment Ltd. ("Carrigain") is controlled jointly by Ariel Malik and Zeev Bronfeld each holding 50% of Carrigain's common shares. Effectively, therefore, each of Mr. Malik and Mr. Bronfeld beneficially owns 33.25% of our shares. The address of Carrigain is Jasmine Court, Regent Street, Belize City, Belize.

Item 13. Certain Relationships and Related Transactions, and Director Independence

Transactions with Related Persons, Promoters and Certain Control Persons

          On February 7, 2007, we issued 12,000,000 shares to our controlling shareholder, Carrigain Investment Ltd., or Carrigain. At the time of issuance, this comprised approximately 52.14% of our outstanding shares. We are informed that Carrigain is controlled by Ariel Malik and Zeev Bronfeld. On April 11, 2007, Carrigain entered into a subscription agreement with the company pursuant to which Carrigain acquired 30,000,000 additional shares of our common stock for an aggregate acquisition consideration of $300,000. Carrigain currently holds 66.5% of our common stock based on 63,187,764 shares of our common stock outstanding as of February 13, 2008.

          During the year ended December 31, 2007, we paid approximately $40,000 for accounting and administrative services performed by a company controlled by our former president. During the comparable period in 2006, no such fees were paid. As of December 31, 2007, no amounts were due and payable in respect of such accounting and administrative services.

          During year ended December 31, 2006, we borrowed $18,000 from four significant shareholders of the company. The loans do not bear interest and are repayable upon demand by the respective creditors. As of December 31, 2007, the loan is still outstanding.

          For more information regarding director and executive compensation, see “Management – Executive Compensation”.

Indebtedness of Directors and Executive Officers

          None of the directors or executive officers of our company or any associate or affiliate of our company during the last two fiscal years, is or has been indebted to our company by way of guarantee, support agreement, letter of credit or other similar agreement or understanding currently outstanding.

26

Director Independence

          We currently act with four directors, consisting of Asi Shalgi, Josef Neuhaus, Avner Raanan and Yair Aloni. We have determined that Josef Neuhaus, Avner Raanan and Yair Aloni are “independent directors” as defined in NASDAQ Marketplace Rule 4200(a)(15).

Item 14. Principal Accountant Fees and Services

Pre-Approval Policy and Procedures

          In December 2007 we established an audit committee. Our board of directors approved the engagement of our accountants and all other services provided to us throughout fiscal year 2007, prior to the services being performed.

Accountant Fees

          The following table shows the aggregate fees for professional services rendered by our accountants for the fiscal years ended December 31, 2007 and December 31, 2006.

		Fiscal Year Ended
		December 31,
		2007			2006
		(in thousands)
Audit Fees	$	129	*	$	14
Audit-Related Fees	$	--		$	--
Tax Fees	$	--		$	1
All Other Fees	$	8		$	- -
Total	$	137	*	$	15

* Audit fees and total fees billed for fiscal year 2007 were 48 and 56, respectively.

Audit Fees

          Audit fees for both years consist of fees for professional services associated with the annual audit of our consolidated financial statements, review of the interim consolidated financial statements and services that are normally provided by our accountants in connection with statutory audits required in regulatory filings.

Tax Fees

          Tax Fees consist of fees for professional services rendered for assistance with federal and state tax compliance.

All Other Fees

          Other fees for fiscal year ended December 31, 2007 includes booking services carried by Benny Gaon CPA.

PART IV

Item 15. Exhibits and Financial Statements

          (a) (1) Financial Statements: Reference is made to the Index to Financial Statements and Financial Statement Schedule in the section entitled “Financial Statements and Supplementary Data” in Item 8. of this Annual Report on Form 10-K.

          (2) Financial Statement Schedule: None

          (3) Exhibits: Exhibits are as set forth in the section entitled “Exhibit Index” which follows the section entitled “Signatures” in this Annual Report on Form 10-K. Exhibits which are incorporated herein by reference can be inspected and copied at the public reference rooms maintained by the Commission in Washington, D.C., New York, New York, and Chicago, Illinois. Please call the Commission at 1-800-SEC-0330 for further information on the public reference rooms. Commission filings are also available to the public from commercial document retrieval services and at the Web site maintained by the Commission at http://www.sec.gov.

27

SIGNATURES

          Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

GLOBAL ENERGY INC.
(Registrant)
By:
/s/ Asi Shalgi	/s/ Alex Werber
Asi Shalgi	Alex Werber
President, Chief Executive Officer	Treasurer and
and Director	Chief Financial Officer
Date: March 31, 2008	Date: March 31, 2008

          KNOWN ALL MEN BY THESE PRESENTS that each individual whose signature appears below constitutes and appoints each of Asi Shalgi and Alex Werber such person’s true and lawful attorney-in-fact and agent with full power of substitution and resubstitution, for such person and in such person’s name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and all documents in connection therewith, with the Commission, granting unto each said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as such person might or could do in person, hereby ratifying and confirming all that any said attorney-in-fact and agent, or any substitute or substitutes of any of them, may lawfully do or cause to be done by virtue hereof.

          Pursuant to the requirements of the Securities and Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
	President, Chief Executive Officer & Director	March 31, 2008
/s/ Asi Shalgi	(principal executive officer)
Asi Shalgi
	Treasurer & Chief Financial Officer (principal	March 31, 2008
/s/ Alex Werber	financial officer and principal accounting officer)
Alex Werber
/s/ Yair Aloni	Director	March 31, 2008
Yair Aloni
/s/ Josef Neuhaus	Director	March 31, 2008
Josef Neuhaus
/s/ Avner Raanan	Director	March 31, 2008
Avner Raanan

28

EXHIBIT INDEX

Exhibit Number	Description
3.1	Articles of Incorporation, as amended (incorporated by reference to Exhibit 3 to the Registrant's quarterly report on Form 10-QSB/A for the quarter ended March 31, 2003, filed with the Commission on April 14, 2004) as amended by Certificate of Amendment (incorporated by reference to Exhibit 99.1 to the Registrant's current report on Form 8-K filed with the Commission on March 26, 2007).
3.2	Bylaws (incorporated by reference to Exhibit 3.(II) to the Registrant's Form 10-SB12G as filed with the Commission on November 10, 1999, file number 000-28025).
4.1	Specimen Certificate for shares of Common Stock (incorporated by reference to exhibit 4.1 to the registrants registration statement on Form SB-2 filed with the Commission on December 5, 2007).
10.1	Lease Agreements between Global Energy Ethiopia PLC and the Southern Nations Nationalities People's Regional State, Ethiopia (incorporated by reference to Exhibits 10.1 and 10.2 to the Registrant's current report on Form 8-K filed with the Commission on October 12, 2007).
10.2	Shareholders Agreement and Term Sheet with Yanai Man Projects Ltd. (incorporated by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed with the Commission on July 25, 2007).
10.3	Shareholder Agreement with Alphakat GMBH (incorporated by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K field with the Commission on July 13, 2007).
10.4	Term sheet with Alphakat GMBH (incorporated by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K field with the Commission on July 13, 2007).
10.5	Securities Purchase Agreement between the Registrant and the Buyer listed on Schedule I attached thereto (incorporated by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed with the Commission on July 12, 2007).
10.6	Warrants GEYI-1-1 and GEYI-1-2 (incorporated by reference to Exhibits 10.2 and 10.3 to the Registrant's current report on Form 8-K filed with the Commission on July 12, 2007).
10.7	Registration Rights Agreement between the Registrant and the Buyer listed on Schedule I attached thereto (incorporated by reference to Exhibit 10.4 to the Registrant's current report on Form 8-K filed with the Commission on July 12, 2007).
10.8	Security Agreement between the Registrant and the Buyer (as defined therein) (incorporated by reference to Exhibit 10.5 to the Registrant's current report on Form 8-K filed with the Commission on July 12, 2007).
10.9	Term sheet with Cornell Capital Partners, LP (incorporated by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed with the Commission on June 1, 2007).
10.10	DeMonte Associates Investor Relations Agreement (incorporated by reference to Exhibit 10.1 to the Registrant's current report Form 8-K filed with the Commission on May 30, 2007).
10.11	Share Option Plan (incorporated by reference to Exhibit 99 to the Registrant's current report on Form 8-K filed with the Commission on May 21, 2007).
10.12	Employment Agreement with Alex Werber (incorporated by reference to Exhibit 99.1 to the Registrant's current report filed on Form 8-K on May 15, 2007).
10.13	Employment Agreement with Dr. Irit Arbel (incorporated by reference to Exhibit 10.2 to the Registrant's current report on Form 8-K filed with the Commission on May 11, 2007).
10.14	Consulting Service Agreement with Yossi Raz (incorporated by reference to Exhibit 10.1 to the Registrant's current report filed on Form 8-K on May 11, 2007).
10.15	Employment Agreement with Asi Shalgi (incorporated by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed with the Commission on May 2, 2007).
10.16	Form of Subscription Agreement (incorporated by reference to Exhibit 10.2 to the Registrant's current report on Form 8-K filed with the Commission on February 9, 2007).
10.17	Form of Subscription Agreement (incorporated by reference to the Registrant's current report Form 8-K field with the Commission on October 30, 2006).
10.18	Form of Promissory Note (incorporated by reference to Exhibit 10.1 the Registrant's current report on Form 8-K filed with the Commission on September 11, 2006).
10.19	Amended and Restated Secured Convertible Debenture No. GEYI-1-1 (incorporated by reference to Exhibit 10.1 the Registrant's current report on Form 8-K filed with the Commission on October 26, 2007).
10.20	Secured Convertible Debenture No. GEYI-1-2 (incorporated by reference to Exhibit 10.2 the Registrant's current report on Form 8-K filed with the Commission on October 26, 2007).

29

10.21	Consulting Agreement dated October 20, 2007 between Registrant and Trianon Partners (incorporated by reference to Exhibit 10.6 to the Registrant's quarterly report on Form 10-QSB filed with the Commission on November 19, 2007).
10.22	Employment Agreement dated November 21, 2007 between Global Energy Inc. and Yossi Raz (incorporated by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed with the Commission on November 29, 2007).
10.23	Secured Convertible Debenture No. GEYI-1-3 (incorporated by reference to Exhibit 10.8 to the Registrant’s current report on Form 8-K filed with the Commission on December 7, 2007).
10.24 *	Business and Royalty Agreement with Covanta Energy Corporation.
10.25 *	License Agreement between AlphaKat-Global Energy GmbH and Covanta Energy Corporation.
10.26 *	Business and Development Agreement with Renewable Diesel, LLC.
10.27 *	License Agreement between AlphaKat-Global Energy GmbH and American Renewable Diesel, LLC.
10.28	Secured Convertible Debenture No. GEYI-1-4 (incorporated by reference to Exhibit 10.9 to the Registrant’s current report on Form 8-K filed with the Commission on March 26, 2007).
10.29	Amendment to the Securities Purchase Agreement, dated March 20, 2008 (incorporated by reference to Exhibit 10.10 to the Registrant’s current report on Form 8-K filed with the Commission on March 26, 2007).
10.30	Amendment no. 1 to Amended and Restated Secured Convertible Debenture No. GEYI-1-1 (incorporated by reference to Exhibit 10.11 to the Registrant’s current report on Form 8-K filed with the Commission on March 26, 2007).
10.31	Amendment no. 1 to Secured Convertible Debenture No. GEYI-1-2 (incorporated by reference to Exhibit 10.12 to the Registrant’s current report on Form 8-K filed with the Commission on March 26, 2007).
10.32	Amendment no. 1 to Secured Convertible Debenture No. GEYI-1-3 (incorporated by reference to Exhibit 10.13 to the Registrant’s current report on Form 8-K filed with the Commission on March 26, 2007).
21.1	List of Subsidiaries of the Registrant (incorporated by reference to exhibit 21.1 to the registrants registration statement on Form SB-2 filed with the Commission on December 5, 2007).
24.1*	Power of Attorney (included on signature page).
31.1*	Rule 13a-14(a)/15d-14(a) Certification, executed by Asi Shalgi, Chief Executive Officer, President and Director.
31.2*	Rule 13a-14(a)/15d-14(a) Certification, executed by Alex Werber, Treasurer and Chief Financial Officer.
32.1*	Section 1350 Certifications, executed by Asi Shalgi, Chief Executive Officer, President and Director, and Alex Werber, Treasurer and Chief Financial Officer.

* Filed herewith

30

EX-10.24

THE SYMBOL “*****” DENOTES PLACES WHERE PORTIONS OF THIS DOCUMENT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. SUCH MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

Exhibit 10.24

BUSINESS AND ROYALTY AGREEMENT

     This Business and Royalty Agreement (this “Agreement”) is made and entered into as of the 6^th day of February, 2008, by and between Global Energy, Inc., a corporation organized and existing under the laws of the State of Nevada (“Global”), and Covanta Energy Corporation, a corporation organized and existing under the laws of the State of Delaware (“Covanta”).

     WHEREAS, AlphaKat GmbH, a company organized and existing under the laws of Germany (“AK”), owns or has certain rights to a proprietary technology developed by Dr. Christian Koch to convert waste material which contains hydrocarbons into diesel (as further defined below, the “Technology”);

     WHEREAS, AK and Global formed AlphaKat - Global Energy GmbH, a company organized and existing under the laws of Germany (“Licensor”), to market the Technology in accordance with the agreements entered into by AK and Global;

     WHEREAS, Global has the right to develop projects using the Technology in the United States and China on an exclusive basis and in other countries, including the United Kingdom and the Republic of Ireland, on a non-exclusive basis; and

     WHEREAS, consistent with the terms of the License Agreement (as defined below), Covanta and Global want to enter into an agreement whereby Global grants to Covanta such exclusive and non-exclusive rights for the development of projects using the Technology in the United States, China, the United Kingdom and the Republic of Ireland as and to the extent held by Global (but without representation by Global with respect to the nature or scope of any such rights), all on the terms and conditions set forth herein;

     NOW, THEREFORE, in light of the mutual premises set forth herein and other good and valuable consideration, the receipt and the sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows.

ARTICLE 1 – DEFINITIONS AND INTERPRETATION

Section 1.1 Capitalized Terms. Unless otherwise specified herein, the following capitalized terms shall have the following meanings:

     “Affiliate” means, in relation to any Person, any other Person that controls, is controlled by, or is in common control with, such Person. For the purpose of this definition, control means the direct or indirect control of fifty percent (50%) or more of the voting rights in such Person or the power to direct the management or policies of such

Person, whether by operation of law, by contract or otherwise. Except as shall otherwise be expressly provided in this Agreement, and for the avoidance of any doubt, as of the Effective Date, (i) Licensor and AK are Affiliates and (ii) Licensor and Global are Affiliates, but AK and Global are not Affiliates.

     “Agreement” has the meaning set forth in the first paragraph hereof.

     “AK” means AlphaKat GmbH, a company organized and existing under the laws of Germany, and its successors and permitted assigns.

     “Assumptions” has the meaning set forth in Section 5.3.

     “Carve-Out Project” has the meaning set forth in Section 2.2.

     “Contracted Waste” means all non-hazardous waste, regardless of the source of such waste, which is under contract to be delivered to Covanta or any of its Affiliates for disposal in, or processing by, one of the facilities owned or operated by Covanta or any of its Affiliates.

     “Commercial Waste” means all non-hazardous solid waste that is collected from commercial establishments, including residential apartment buildings, office buildings, restaurants, industrial parks, all other business facilities and all recyclable materials from recycling facilities.

     “Competitor” means a Competitor of Covanta or a Competitor of Global, as the context requires.

     “Competitor of Covanta” means a Person, directly or through Affiliates, engaged primarily in the waste disposal business, including the energy from waste business.

     “Competitor of Global” means a Person, directly or through Affiliates, engaged primarily in the business of selling equipment that converts waste or organic feedstock(s) containing hydrocarbon materials into diesel fuel or any Person that is involved primarily in the development of such equipment or the technology on which it is based.

     “Consulting Agreement” means the Consulting Agreement entered into by Global and Trianon dated October 20, 2007, a copy of which has been provided to Covanta.

     “Covanta” has the meaning set forth in the first paragraph hereof and includes its successors and permitted assigns.

     “Covanta Rights” has the meaning set forth in Section 2.1.

     “Default” has the meaning set forth in Section 7.1.

     “Demonstration Plant” has the meaning set forth in the License Agreement.

Execution Copy 2

     “Dispute” has the meaning set forth in Section 9.1.

     “DP Site” has the meaning set forth in Section 4.2(b) .

     “DP System” has the meaning set forth in Section 4.2.

     “Effective Date” has the meaning set forth in Section 6.1.

     “Election Notice” has the meaning set forth in Section 4.2.

     “Excluded Projects” has the meaning set forth in Section 2.3(a)

     “Extended Period” has the meaning set forth in the License Agreement.

     “Feedstock” means Household Waste, Contracted Waste, Commercial Waste or Radial Biomass, as the case may be.

     “Global” means Global Energy, Inc., a Nevada corporation.

     “Governmental Organization” has the meaning set forth in the License Agreement.

     “Household Waste” means all non-hazardous, post-recycled municipal solid waste which is collected from residences, which waste is of the type normally accepted for processing at waste to energy facilities in the United States, China, the United Kingdom or the Republic of Ireland, as the case may be.

     “ICC” means the International Chamber of Commerce.

     “ICC Rules” has the meaning set forth in Section 9.1(c) .

     “Improvements” means all the techniques, enhancements, modifications, changes, experience, methods, information, data or knowledge that will be created or acquired in the future relating to the Technology and/or the manufacturing of such components for Systems (whether or not patentable, useful or workable) through the implementation, development, testing and improvement of the Technology.

     “Initial Period” has the meaning set forth in the License Agreement.

     “Interim Period” has the meaning set forth in the License Agreement.

     “KDV 500” means the system of components, including all of the structural steel, piping, pumps, vessels, control systems, wiring, two proprietary “mixing turbine pumps” and the operations, maintenance and start-up manuals provided by AK, to convert

Execution Copy 3

hydrocarbon feedstock, including any Feedstock, into diesel oil using the Technology which is capable of producing a minimum of 500 liters of diesel oil per hour.

     “License Agreement” means the License Agreement entered into by Covanta and Licensor of even date herewith, a copy of which has been provided to Global.

     “Licensor” has the meaning set forth in the second recital hereto and includes its successors and permitted assigns.

     “LLCA” has the meaning set forth in Section 2.3(g) .

     “Parties” means Global and Covanta.

     “Party” means Global or Covanta, as the case may be.

     “Person” means any natural person, corporation, company, partnership, business trust, governmental authority or other entity.

     “Project” means a project which is initiated, developed and owned by Covanta, a Covanta Affiliate or a Governmental Organization, in whole or in part, to convert a Feedstock to diesel using the Technology in Territory A or Territory B.

     “Project Company” has the meaning set forth in Section 2.3(g) .

     “Purchase Order” has the meaning set forth in the License Agreement.

     “Radial Biomass” means biomass, including wood, wood waste and other types of cellulosic materials which are collected within or from an area within a 100 mile radius of any biomass facility that is owned by Covanta or an Affiliate of Covanta in the states of California or New York as of the Effective Date.

     “Royalty” has the meaning set forth in Section 5.1.

     “System” means any system of components, whether it is in existence today or developed hereafter, including all of the structural steel, piping, pumps, vessels, control systems, wiring, the proprietary “mixing turbine pump(s),” any new components of any future system of components and all of the operations, maintenance and start-up manuals provided by AK, to convert hydrocarbon feedstock, including any Feedstock, into diesel oil using the Technology, including, for the avoidance of doubt, the KDV 500.

     “Technology” has the meaning set forth in the License Agreement.

     “Territory A” means the United States.

     “Territory B” means China, the United Kingdom and the Republic of Ireland.

Execution Copy 4

     “Trianon” means Trianon Partners, a Nevada corporation, and its successors and assigns.

Section 1.2 Interpretation. In this Agreement, unless otherwise indicated or required by the context:

     (a) Reference to and the definition of any document (including this Agreement) or any applicable law shall be deemed a reference to such document or applicable law as it may be amended, supplemented, revised or modified from time to time;

     (b) All references to an “Article,” “Section” or “Exhibit” are to an Article or Section hereof or to an Exhibit attached hereto;

     (c) Article and Section headings and other captions are for the purpose of reference only and do not limit or affect the meaning of the terms and provisions hereof;

     (d) Defined terms in the singular include the plural and vice versa, and the masculine, feminine and neuter gender include all genders;

     (e) The words “hereof,” “herein” and “hereunder” and words of similar import refer to this Agreement as a whole and not to any particular provision of this Agreement;

     (f) The words “include,” “includes” and “including” mean include, includes, and including “without limitation” and “without limitation by specification;” and

     (g) The phrase “exclusive right(s)” as used herein is intended to have the same meaning as the term “Full Right(s)” as used and defined in the License Agreement and the phrase “non-exclusive right(s)” as used herein is intended to have the same meaning as the term “Qualified Right(s)” as used and defined in the License Agreement.

ARTICLE 2 – RELATIONSHIP AND RIGHTS OF THE PARTIES

Section 2.1 Rights of Covanta. Subject to the terms of this Agreement, and intending to be consistent with the terms and conditions of the License Agreement, during the Interim Period, the Initial Period and the Extended Period, Global hereby grants to Covanta to the extent now or hereafter held by Global during the term of this Agreement (the “Covanta Rights”):

     (a) The exclusive right in Territory A (subject to the rights of Licensor with respect to Carve-Out Projects) and the non-exclusive right in Territory B to use, practice and make Improvements to the Technology for Projects using Household Waste; except that Licensor shall retain the right to develop Carve-Out Projects within Territory A as set forth in Section 2.2;

Execution Copy 5

     (b) The exclusive right in Territory A and Territory B to use, practice and make Improvements to the Technology in connection with Projects using Contracted Waste;

     (c) The exclusive right in the applicable areas of Territory A to use, practice and make Improvements to the Technology in connection with Projects using Radial Biomass;

     (d) The non-exclusive right in Territory A and Territory B to use, practice and make Improvements to the Technology in connection with Projects using Commercial Waste; and

     (e) To sell Systems to Governmental Organizations as is permitted by Section 2.5 of the License Agreement.

Global expressly agrees that it shall not do anything in connection with the Technology, during the term of the License Agreement, which is inconsistent with any of the exclusive rights granted by Licensor to Covanta as part of the Covanta Rights regardless of whether such rights have been or will be granted to Global by Licensor. For the avoidance of doubt, Covanta shall be entitled to exercise any or all of the license rights granted to it in the Technology itself or through any of its Affiliates, but Covanta shall not have the right to issue sublicenses to any Person other than an Affiliate.

Section 2.2 Carve-Out Projects. The term “Carve-Out Project” shall mean any project using the Technology that is initiated and developed by Global which is comprised of a maximum of four (4) KDV 500s (or its equivalent in output capacity in other Systems), such number of KDV 500s to be reduced if it is necessary for the project to process more than 125 tons of Household Waste to meet the maximum diesel output capacity of the four (4) Systems in a county, township or other geographic area in Territory A where the amount of Household Waste collected is 125 tons per day or less. Prior to the date that Covanta has satisfied the requirements set forth in Section 2.1(a) of the License Agreement, Global shall not have the right to develop Carve-Out Projects. Following the date that Covanta has satisfied the requirements set forth in Section 2.1(a) of the License Agreement, Global shall have the right to develop Carve-Out Projects, subject to the following procedures:

     (a) Pre-Approval Notice. If Global is contacted by a Person interested in a project that will process Household Waste using the Technology or if Global is interested in pursuing potential projects that will process Household Waste using the Technology in a particular geographic area, Global shall have the right to notify Covanta, in writing, about the project opportunity (a “Pre-Approval Notice”) and ask Covanta to confirm, in writing, whether it agrees that a project to process Household Waste using the Technology in such geographic area will qualify as a Carve-Out Project. Covanta shall not unreasonably withhold such confirmation and shall respond to each such Pre-Approval Notice in writing within thirty (30) days of the receipt thereof. If Covanta fails

Execution Copy 6

to respond to any Pre-Approval Notice within such thirty (30) day period, such failure shall be deemed to be an approval.

     (b) Carve-Out Project Notice. If Global decides to pursue a Carve-Out Project (whether such project has been the subject of a Pre-Approval Notice or not), Global shall provide a written notice to Covanta (a “Carve-Out Project Notice”) to advise Covanta that Global is proceeding with a Carve-Out Project, such notice to include as much detail about the project as available at the time, including the name of the project, the geographic area in which the project is located, information about the collection of waste in such area to support the conclusion that the project qualifies as a Carve-Out Project (unless Covanta has already confirmed that such project qualifies as a Carve-Out Project in its response to a prior Pre-Approval Notice or is deemed to have confirmed it pursuant to Section 1.2(a)), the supplier of the Household Waste for the project, any commercial terms regarding the tipping fees for the project and potential off-take arrangements, an estimate of the cost of developing the project, the pro forma for the project, if available, and any other information which is available to Global that might be relevant to Covanta in making a decision whether to jointly pursue the development of such project with Global. Covanta shall have forty-five (45) days from the receipt of the Carve-Out Project Notice to review the project information and decide whether Covanta wants to jointly develop the project with Global (Covanta to have the right to provide sixty-five percent (65%) of the equity required for the project, subject to the obligation to fund sixty-five percent (65%) of the development costs). During the forty-five (45) day period, Global shall use all reasonable business efforts to respond to any questions raised by Covanta and the Parties shall meet to discuss the project if either Party requests to do so. Unless the Parties have otherwise agreed to jointly develop the project and on what terms, Covanta shall provide a written notice to Global prior to the expiration of the forty-five (45) day period indicating whether Covanta wants to jointly pursue the project with Global. If Covanta fails to respond in a timely manner to a Carve-Out Project Notice, it shall be deemed the delivery of a written notice that Covanta is not interested in jointly developing such project.

     (c) Proceeding with Carve-Out Project. If Covanta decides to proceed jointly with Global in developing a Carve-Out Project, the Parties shall cooperate together, in good faith, to document the basic business arrangements as soon as practicable, in writing, so that the joint development of the Project can proceed. If Covanta decides that it does not want to proceed jointly with Global in pursuing a Carve-Out Project (or if Covanta is deemed to have decided not to proceed jointly), then Global, subject to the provisions of Section 2.2(d), shall be entitled to proceed with such Carve-Out Project on its own.

     (d) Disputes. Notwithstanding anything which may be contained herein to the contrary, if Covanta believes that a project does not qualify as a Carve-Out Project and Global disputes such claim, then, if the Parties cannot resolve their differences, the issue shall be considered a Dispute and it shall be resolved in accordance with the provisions of Article 9.

Execution Copy 7

Section 2.3 Project Investment Rights of Global. Covanta hereby grants to Global the right to invest equity in the Projects being developed by Covanta during the Initial Period and the Extended Period and which are to be owned by Covanta or a Covanta Affiliate, subject to the further provisions and procedures of this Section 2.3.

     (a) Excluded Projects. Global shall not have the right to invest equity in (i) any Projects developed by Covanta that will be owned by a Governmental Organization, (ii) the Demonstration Plant and (iii) up to ten (10) individual Systems that Covanta has the right to purchase through Licensor for use by Covanta at any of its waste to energy plants in Territory A and which will be owned by Covanta or a Covanta Affiliate (the “Excluded Projects”).

     (b) Equity Investment Notice. If Covanta decides to pursue any Project that is not an Excluded Project, Covanta shall provide a written notice to Global (an “Equity Investment Notice”) to advise Global that Covanta is proceeding with the Project, such notice to include as much detail about the Project as is available at the time, including the name of the Project, the supplier of the Feedstock for the Project, any commercial terms regarding the tipping fees for the Project and potential off-take arrangements, an estimate of the cost of developing the Project, the pro forma for the Project, if available, and any other information which is available to Covanta that might be relevant to Global making a decision to invest equity in such Project. Global shall have forty-five (45) days from the receipt of the Equity Investment Notice to review the information about the Project and decide whether Global wants to invest equity in the Project. During the forty-five (45) day period, Covanta shall use all reasonable business efforts to respond to any questions raised by Global and the Parties shall meet to discuss the Project if either Party requests to do so. Global shall have the right, in its sole discretion, to invest up to thirty-five percent (35%) of the total required equity for each Project which is the subject of an Equity Investment Notice, but in no event may Global invest less than ten percent (10%) of the total equity in such Project. If Global elects to invest in a Project, Global shall provide a written response to Covanta (the “Equity Commitment Response”) prior to the expiration of the forty-five (45) day period indicating whether Global wants to invest equity in the Project and, if so, the total percentage of the required equity that it wants to invest. If Global fails to respond in a timely manner to an Equity Investment Notice, it shall be deemed the delivery of a written notice that Global is not interested in investing equity in the Project. If the Equity Commitment Response indicates that Global is not interested in providing any of the required equity for a Project (or Global is deemed to have delivered such a notice), then Covanta shall be free to pursue the Project without any further obligation to offer Global the right to invest equity in such Project.

     (c) Equity Commitment Letter. If Global decides it wants to invest a portion of the required equity for a Project, the Parties shall cooperate together, in good faith, to enter into an equity commitment letter (the “Equity Commitment Letter”) based upon the form of equity commitment letter attached hereto as Exhibit 2 within thirty (30) days of the receipt of the Equity Commitment Response, which letter shall set forth (i) the total anticipated equity investment for the Project, (ii) a tentative schedule for the funding of the equity for the Project which shall be based on the anticipated terms for the relevant

Execution Copy 8

Purchase Order and the costs and installation schedule for the balance of the Project, (iii) the percentage of the total required equity to be provided by Global (up to a maximum of thirty-five percent (35%) of the total required equity but not less than ten percent (10%) of the total required equity) and (iv) any such other terms as the Parties may mutually agree. Global acknowledges and agrees that the anticipated equity investment and equity funding schedule will only be an estimate and that the ultimate equity investment and equity funding schedule shall be what is required for the Project.

     (d) Recovery of Development Costs. Global recognizes that Covanta will be incurring development costs in connection with each of the Projects in which Global has decided to make an equity investment, including burdened costs for its own personnel that are working on the development of the Project. To minimize difficulties associated with tracking its development costs, the Parties agree that Covanta shall be reimbursed from the initial equity investment made by the Parties in a particular Project for all of the third party development costs incurred by Covanta plus a development fee equal to One Hundred Thousand Dollars ($100,000) for each KDV 500 that is installed as part of the Project (such amount to be increased if the Project uses a System other than a KDV 500 in proportion to the increased diesel output of the System installed), but in no event shall the development fee for a Project exceed the sum of One Million Dollars ($1,000,000). For each of the Projects in which Global decides to invest, Covanta shall provide Global with a schedule of the third party development costs that Covanta has incurred, together with copies of the invoices in support of such costs.

     (e) Equity Investment into Project. Prior to the execution of a Purchase Order for the Systems required for a Project, Covanta shall provide Global with an update of the total expected equity required for the Project and an updated schedule for the contribution of the equity. All equity invested in a Project shall be invested as a capital contribution to the limited liability company to be established by Covanta and Global for the Project. If a scheduled equity funding commitment is pending and Global determines that it will not be able to fund all or part of such obligation, Global shall promptly provide written notice to Covanta (which shall in no event be less than ten (10) days’ prior to the date that such funding is due) indicating the amount, if any, of the equity that Global will fund on such date. If Global fails to timely fund an equity funding commitment in accordance with the final equity funding schedule for the Project, in whole or in part, then, unless Covanta agrees otherwise in its sole discretion, Global shall forfeit its right to fund any additional equity for the Project and Covanta shall fund the balance of the equity that is required for the Project. Notwithstanding anything contained herein to the contrary, if the equity that is required for the Project exceeds the amount that was estimated by the Parties, Global shall be entitled to fund a pro rata share of such equity as the funds are needed. Once the Project achieves commercial operation, the respective equity percentages of the Parties shall be determined based on the total amount of the equity that was actually funded by each Party.

Execution Copy 9

     (f) Operation and Maintenance of Projects by Covanta. During the Interim Period, the Parties shall cooperate together in good faith to develop a standard form of an operations and maintenance agreement (the “OMA”) pursuant to which an Affiliate of Covanta shall be engaged to operate all Projects that will be jointly owned by Covanta and Global. Unless the Parties otherwise agree, for the first five (5) years following the Effective Date, the OMA shall be based on a “cost plus” structure with a fixed annual fee of Four Hundred Thousand ($400,000) as of January 1, 2008 (such amount to be adjusted each year by the increase in the Consumer Price Index published by the U.S. Department of Labor Bureau of Labor Statistics CPI-U for All Urban Consumers, US City Average (Table 1)). Prior to the end of the five (5) year period, the Parties will review the amount of the fee and whether different fixed fees should be charged for Projects with different numbers of Systems. Under the OMA, Covanta or its Affiliate shall be reimbursed for all direct costs of operating the Project and for the burdened costs of the operators and all supervisory personnel dedicated to the operation of the applicable Project.

     (g) Execution of LLCA. Each Project in which Global invests shall be owned by a separate limited liability company (each, a “Project Company”) formed to own and operate the Project. Prior to executing the Purchase Order for a Project, the Parties shall negotiate, in good faith, a limited liability company agreement (the “LLCA”) for the Project Company based on the standard form of LLCA agreed to by the Parties, it being agreed that each Project will have its own unique requirements that will have to be addressed in the LLCA for the applicable Project Company. Within sixty (60) days of the execution hereof, Covanta will provide a proposed form of LLCA that is based on the relevant provisions of this Agreement and the key terms set forth in Exhibit 1 attached hereto (or cause Trianon to provide such draft to the Parties). During the sixty (60) day period following the delivery of the initial draft of the LLCA, the Parties shall negotiate a standard form of LLCA to be used as the model for future LLCAs to be entered into by the Parties for projects to be jointly owned by the Parties during the Initial Period and the Extended Period. Once the Parties have finalized the standard form of LLCA, they shall execute a document confirming that such document is the standard form of LLCA and it shall replace the key terms set forth in Exhibit 1.

     (h) Sale of Interest in Projects. If Covanta or Global wants to sell its interest in any Project in which the Parties have jointly invested, the Parties agree that any such sale shall be accomplished by the applicable Party (the “Selling Party”) selling its membership interest in the Project Company and any transfer by any Selling Party in contravention of the provisions of this Section 2.3(h) (whether by sale or transfer of an intermediate holding company or other direct or indirect transfer) shall be void and of no force and effect. Any such sale shall be subject to the restrictions and other conditions set forth in the LLCA for the Project Company. The LLCA shall require the Selling Party to first offer to sell the membership interest to the other Party in accordance with a formula price or an appraisal process, as the Parties shall determine when the standard form of LLCA is negotiated. If such other Party does not want to purchase the membership interest from the Selling Party, the Selling Party shall be entitled to sell the membership interest to any Person other than a Competitor of such other Party unless such other Party consents to the sale in writing in its sole discretion.

Execution Copy 10

     (i) Financing of Projects. Global acknowledges that Covanta does not intend to secure debt financing for each Project that is to be developed by Covanta and that the funding for such Projects is expected to be all in the form of equity. If Covanta elects to arrange a financing for a particular Project in which Global has committed to invest prior to the placement of the Purchase Order for the Systems that are required for such Project and the lender(s) for such Project are not willing to accept the risk that Global will timely fund its equity commitments or any of its other support obligations to the Project, Global shall be required to provide whatever credit support is required by such lender(s) for its equity investment and its share of any other equity support obligations, including a letter of credit in support of such commitments. Once Covanta has been able to secure limited recourse take-out financing for one or more Projects, as discussed in Section 2.2(j), it will consider arranging a tranche of limited recourse debt for Projects with a capital cost in excess of $40 Million prior to the commencement of the construction of such Projects. Notwithstanding anything which is contained herein to the contrary, Covanta shall not be under any obligation whatsoever to provide a “wrap” of Global’s equity obligation or any other credit support obligation of Global to the lender(s).

     (j) Take-Out Financings. Covanta or the Project Company will evaluate the ability to secure limited recourse take-out financing for multiple Projects once they have operated successfully for a period of at least eighteen (18) months to enable Covanta and Global to recover some or all of the equity that each has invested in such Projects. If the overall conditions in the credit markets and the merits of the potential financing options are favorable, Covanta shall undertake to secure limited recourse take-out financing. If Covanta pursues such a financing, Global agrees to cooperate with Covanta and the lender(s) in good faith in pursuing and closing such financing. Global shall be required to provide whatever credit support is required by such lender(s) for its share of any equity support obligations for such take-out financing, including a letter of credit in support of such commitments. The proceeds of any such take-out financing shall be distributed to each Party in the ratio that such Party’s total equity investment in all of the Projects that are the subject of such financing bears to the total equity investment of both Parties in all such projects.

     (k) Entitlements. In each Project in which Global Energy elects to invest, the Parties will form a Project Company as further provided for in Section 2.3(g) to own such Project. As an owner of the Project Company, each Party (or its Affiliate) will be entitled to its pro rata share of all of the items of income, gain, loss, deduction and credit derived by the Project Company and its pro rata share of the net distributable cash flow of the Project Company.

Section 2.4 EPA Certification. Covanta will use commercially reasonable efforts during the term hereof to obtain United States Environmental Protection Agency certification for use of the diesel oil to be produced by the Systems to be used as a fuel in highway motor vehicles in the Unites States. Covanta shall take the lead with respect to the necessary activities for securing such certification, including preparing and submitting applications to, and making necessary contacts with, the United States Environmental Protection Agency,

Execution Copy 11

and Global shall reasonably cooperate with such efforts to be undertaken by Covanta. Covanta shall track all the costs incurred in connection with the necessary activities (including costs for necessary tests, meetings with agency officials, third party consultants, the preparation of written reports and applications and any government relations activities) using Covanta’s existing cost accrual and tracking systems. Prior to incurring such costs, Covanta shall provide Global with a schedule of the reasonably expected costs related to such activities, the third party vendors and other expenses expected to be incurred by Covanta for prior approval by Global and Global agrees to not unreasonably withhold or delay its approval. The Parties agree that Covanta shall be reimbursed by Global for fifty percent (50%) of all the costs and expenses which are incurred by Covanta in connection with seeking such fuel certification, all such costs to be supported by proper verification of such costs and expenses, including invoices.

Section 2.5 Certain Sales by Licensor. The Parties acknowledge that Licensor shall be entitled, prior to the time that Covanta has completed the purchase of the Demonstration Plant and placed a Purchase Order and paid the deposit on five (5) additional Systems, all as further provided for in Section 2.1(a) of the License Agreement, to sell Systems that it would otherwise not be allowed to sell pursuant to the terms of the License Agreement once Covanta has performed the requirements set forth in Section 2.1(a) of the License Agreement. The Parties acknowledge and agree that it is in their mutual best interest for Licensor to not sell Systems in Territory A to any Person other than Covanta, Global and Renewable Diesel, LLC, a Delaware limited liability company. Accordingly, the Parties further agree as follows:

     (a) Notices. If any Person contacts Licensor at any time during the period which is specified in Section 2.1(c) of the License Agreement to purchase one or more Systems for any of the purposes which are specified in clause (ii) of Section 2.1(c) of the License Agreement, Global shall (i) provide a written notice of such contact to Covanta and (ii) a written notice to such Person (with a copy of such notice to Covanta) that no Systems can be sold for such purpose unless such Person offers Covanta, in writing, the right to invest 50 percent of the cost of the project to be developed with such Systems and to own 50 percent of such project (on an equal basis and terms with such Person) and the right to operate such project. Covanta agrees it shall notify such Person and Licensor, in writing, whether Covanta wants to be involved in such project as a 50 percent owner and operator or waive its right to do so. The Parties acknowledge that AK has agreed, by its acknowledgment of the terms of the License Agreement, not to enter into a Purchase Order with such Person unless Licensor has satisfied the notice requirements of Section 2.1(d) of the License Agreement and Covanta elects to not participate in the project.

     (b) Notice by Covanta. Covanta shall notify the Person that wants to purchase the System(s), in writing, with a copy to Licensor and Global, whether Covanta wants to be involved in such project as a 50 percent owner and as the operator or waive its right to do so.

Execution Copy 12

     (c) Actions by Global. Global further agrees to take all reasonable actions, in its capacity as 50 percent owner of Licensor, to prevent the sale of such Systems to any Person unless all of the foregoing requirements have been satisfied.

     (d) Penalty. If Global is aware of a potential sale of Systems by Licensor to a Person in violation of the provisions set forth in the License Agreement and this Section 2.5 and the sale proceeds without Covanta being given the right to own 50 percent of the project being developed with such Systems and the right to operate such project, Global agrees to waive its right to receive the Royalty hereunder on a number of Systems equal to the number of Systems that are sold by Licensor in violation of such requirements. Thus, if Licensor sells three (3) Systems to a Person to process Household Waste for a project in the United States without offering Covanta the right to own 50 percent of such project and to operate the project, Global shall waive its right to the Royalty on the first three (3) Systems purchased by Covanta.

Section 2.6 Commitment to Help Secure Refund of Purchase Order Deposit. Licensor has agreed, pursuant to Section 2.1(a) of the License Agreement, that if Covanta places one or more Purchase Order(s) for a total of five (5) Systems (excluding the Purchase Order for the Demonstration Plant), makes a down payment equal to ten percent (10%) of the Purchase Price to AK at the time such Purchase Order(s) are placed and later decides, for any reason, to terminate the License Agreement and give up all of its license rights thereunder, to use all reasonable business efforts to arrange for AK or Licensor to refund such deposit to Covanta in full or, if Covanta agrees, to apply the portion of such deposit not reimbursed to any Purchase Order(s) that have been or are placed by Global for its own account or for a customer of Global for a project using the Technology (with such party reimbursing Covanta for the full amount of the deposit so credited to its Purchase Order). Global agrees to use all reasonable business efforts to assist Covanta in securing the refund from AK and Licensor and further agrees to apply the deposits to future Purchase Orders placed by Global, subject to Global agreeing to pay the full amount so credited to Covanta simultaneously with the giving of the credit.

ARTICLE 3 – CONDITIONS TO EFFECTIVENESS

Section 3.1 Reimbursement of Payments to Trianon. On or before the Effective Date, (i) Global shall provide Covanta with a schedule of all of the payments made to Trianon pursuant to the Consulting Agreement and (ii) Covanta shall reimburse Global for the full amount of such scheduled payments.

Section 3.2 Consulting Agreement with Trianon. On or before the Effective Date, Covanta shall enter into an arrangement with Trianon to replace the Consulting Agreement. On the Effective Date, Trianon shall provide a letter to Global and Covanta confirming that the Consulting Agreement has been terminated.

Execution Copy 13

Section 3.3 Letter Agreement. On or before the Effective Date, Global shall provide a letter to Licensor confirming that Global accepts the granting of the Covanta Rights and that it will not exercise any of such rights while the License Agreement is in effect.

Section 3.4 Payment to AK. On or before the Effective Date, Covanta shall have paid [*****] to AK as required by Section 3.6 of the License Agreement.

ARTICLE 4 – DEMONSTRATION PLANT

Section 4.1 Ownership and Financing of the Demonstration Plant. The Demonstration Plant shall be owned by a special purpose entity to be formed and owned by Covanta or an Affiliate of Covanta. Covanta shall be responsible for financing 100 percent of the costs of the Demonstration Plant, including all the costs to permit the plant, procure the components for the plant (including the System), construct, install and start-up the plant and make the plant operational and a reasonable amount of working capital to enable the special purpose entity to commence the operation of the plant.

Section 4.2 Transfer of Demonstration Plant System to Global. If Covanta elects not to proceed to the Initial Period in accordance with the provision of Section 2.2(f) of the License Agreement, Covanta shall provide a written notice to Global simultaneously with the notice required to be provided to Licensor in Section 2.2(f) of the License Agreement stating that it has elected not to proceed to the Initial Period (the “Election Notice”). If Covanta elects not to proceed to the Initial Period ), Covanta shall be obligated to transfer the System that it purchased for the Demonstration Plant (the “DP System”) to Global, at no cost to Global, subject to the procedures set forth below:

     (a) Notice to Covanta. If Covanta does not provide the notice to Licensor as provided for in Section 2.2(f) of the License Agreement by the due date specified therein or if Covanta fails to provide the Election Notice to Global on such due date as provided for herein, Global shall have the right to notify Covanta that it wants the DP System to be transferred to Global at any time during the sixty (60) day period following the due date for such notices. If Global fails to provide such notice during such sixty (60) day period, Global shall be deemed to have decided to not have the System transferred to Global, and Covanta shall be free to retain or dispose of the System as it sees fit without any further obligation to Global in respect thereof.

     (b) Removal of the System from the Demonstration Plant. Upon Covanta’s receipt of a notice from Global that it wants the DP System as is provided for in Section 4.2(a), Covanta shall remove the DP System from the Demonstration Plant, disassemble the DP System and place it at a location on the site of the Demonstration Plant (the “DP Site) so that it can be picked up and removed from such site by truck, all at Covanta’s sole cost and expense. For the avoidance of doubt, Covanta shall not be required to remove any other portion of the Demonstration Plant other than the DP System purchased from AK. Covanta shall use all reasonable efforts to remove and disassemble the DP System without damaging it, but it will not be responsible for any such damages unless

Execution Copy 14

Global can show that the damages were due to an intentional act or the gross negligence of Covanta or any of its contractor or their respective employees.

     (c) Notice to Global. Covanta shall provide an initial notice to Global stating when it expects that the DP System will be available for pick-up in accordance with the provisions of Section 4.2(b) and shall provide a second notice when such work has been completed and the DP System is available for pick-up.

     (d) Removal from the DP Site. Global will have ninety (90) days following the receipt of the second notice provided for in Section 4.2(b) that the DP System is available for pick-up (or such longer period as may be agreed to by Covanta in its sole discretion), to arrange for a qualified contractor to pick up the DP System and remove it from the DP Site at Global’s sole expense. The contractor engaged by Global shall provide Covanta with a certificate of insurance (reflecting all standard required coverages required for a Person performing such work) prior to being allowed to enter onto the DP Site and shall observe all of Covanta’s standard security procedures while on the DP Site. For the avoidance of doubt, Global shall not be responsible for any other removal costs or the costs associated with returning the DP Site to the condition that it was in prior to the installation of the Demonstration Plant, any such costs to be solely for the account of Covanta.

     (e) Title to the DP System and Condition. The DP System which is removed from the Demonstration Plant shall be transferred to Global in its “as is” and “where is” condition, without any representations and warranties except for good title, free and clear of any liens.

     (f) Failure to Remove. If Global fails to remove the DP System by the date specified in Section 4.2(d) (or notifies Covanta, in writing, that Global is not interested in securing the DP System), Covanta shall be free to retain or dispose of the DP System as it sees fit without any further obligation to Global in respect thereof.

Section 4.3 Visiting the Demonstration Plant. The officers and employees of Global shall be entitled to visit the Demonstration Plant at any time subject to providing Covanta with twenty-four (24) hours prior notice and observing the standard security procedures of Covanta while on the DP Site. The officers and employees of Global shall have the right to bring all interested parties (other than Competitors of Covanta) to observe the DP System in operation at the Demonstration Plant subject to (i) providing Covanta with a minimum of forty-eight (48) hours prior notice of the date and time of the proposed visit, the names of each person that will be visiting and the company or party that such person represents, (ii) Covanta confirming that it expects the DP System to be operational at the time of the visit and (iii) observing the standard security procedures of Covanta while on the DP Site. Notwithstanding the foregoing, if Covanta does not expect the DP System to be operational on the date of the proposed visit, the Parties shall cooperate to allow for such visit to take place as soon thereafter as practicable. Under no circumstances will Covanta be obligated to run any particular feedstock in the DP System during any such visit unless Covanta agrees to do so in its sole discretion. In addition to the foregoing

Execution Copy 15

requirements, all of the Global visitors shall comply with the following: (a) remain on the DP Site only if accompanied by a guide that is provided by Covanta; (b) avoid any interference with the operation or maintenance of the Demonstration Plant; (c) not be on the DP Site for more than six (6) hours; and (d) not take any photographs, video or other digital impressions of the Demonstration Plant or the DP Site without the express written permission of Covanta.

Section 4.4 Access to Information. Covanta agrees to provide Global with complete and total access to all information developed in connection with the installation, start-up and operation of the Demonstration Plant as if Global was a fifty percent (50%) owner of the Demonstration Plant. Such information shall include the results of all tests, operating logs, internal reports, operations and maintenance expenses and all other information that is applicable to the installation and use of the Technology that is relevant to Global in its efforts to commercialize the Technology. For the avoidance of doubt, nothing contained in this Section 4.4 shall obligate Covanta to disclose confidential information to Global in respect of any project that is owned or operated by Covanta on or adjacent to the DP Site. Covanta further agrees to use all reasonable commercial efforts to respond to inquiries from Global regarding the information that has been provided regarding the Demonstration Plant. The Parties are aware that a number of Improvements could be made regarding the design and fabrication of the Technology that will enable the Demonstration Plant to be more effective and that Covanta’s feedback from the initial start-up and operation of the Demonstration Plant could yield additional possibilities for design and fabrication Improvements. The Parties shall cooperate with each other and with Licensor to work on any such Improvements to the Technology prior to AK completing the manufacturing of the System that is ordered for the Demonstration Plant, as well as following the delivery, start-up and operation of such System.

ARTICLE 5 – ROYALTY

Section 5.1 Calculation of the Royalty. Covanta shall pay a royalty (the “Royalty”) to Global based on the amount of diesel that is sold by each Project equal to ten percent (10%) of the revenue derived from the sale of such diesel (exclusive of any taxes and any costs included in the price for the delivery of such diesel, which costs shall be separately stated in all such agreements for the sale of diesel) for a period of twenty (20) years from the date that the applicable Project achieves commercial operation. With respect to the Royalty, it is further agreed that:

     (a) For the avoidance of doubt, the Royalty will not apply to the tipping fees that are received by a Project on the material it accepts for conversion or to the value of any production tax credits or any other credits received by the owner of the Project or any other revenue streams other than the sale of diesel;

Execution Copy 16

     (b) Following the termination of the License Agreement, Covanta shall not be obligated to pay the Royalty on any future Projects developed by Covanta (excluding any Projects that have placed a purchase order for one or more Systems prior to the date of termination or loss);

     (c) Notwithstanding anything contained herein to the contrary, Covanta shall not be obligated to pay the Royalty with respect to (i) the Demonstration Plant or (ii) any project other than a Project, including any projects initiated and developed by Trianon or Global (even if Covanta invests in any such project) except that the Royalty shall be paid on all Carve-Out Projects in which Covanta invests;

     (d) Notwithstanding anything contained herein to the contrary, Covanta shall not be precluded from ceasing operation of any Project if Covanta determines that the net revenues of such Project are not sufficient to meet expenses or if it operates the Project at an unacceptable level of profit, loss or risk. Once the operation of any Project has been terminated, Covanta shall not be required to pay any Royalty with respect to such Project unless and until the operation of the Project is re-commenced; and

     (e) If Covanta wants to develop any Project on the basis that the diesel which is produced by the Project will be given to a party involved in the Project as consideration for its involvement, the Parties shall agree on a method of valuing the diesel for purposes of determining the Royalty or adopt an alternate way of calculating the Royalty for such Project.

Section 5.2 Payment of the Royalty. Covanta shall calculate the Royalties that are due to Global for each calendar quarter and pay the amount calculated within sixty (60) days following the end of each such calendar quarter. Covanta shall provide a statement to Global with each payment showing the total number of gallons of diesel fuel sold by each System or Project and the total amount paid for such diesel fuel (unless an alternate way of calculating the Royalty for a particular Project has been agreed to by the Parties, in which case Covanta shall show the relevant information in support of such calculation for such Project). Global shall be entitled to have an independent accounting firm review Covanta’s records from time to time to verify the calculation of the Royalty contained in a particular quarterly statement for a period of two (2) years following the receipt of such statement. If Global disagrees with the calculation of any Royalty payment, it shall notify Covanta of the basis of its disagreement and the Parties shall attempt to resolve such disagreement within sixty (60) days. If the Parties cannot resolve their disagreement within such sixty (60) day period, either Party may treat such failure to agree as a Dispute and require it be resolved in accordance with the procedures set forth in Article 9.

Section 5.3 Change of Assumptions. Global acknowledges that the fixed percentage that is specified herein for the Royalty assumes that the Demonstration Plant will confirm the operating cost and performance inputs to be provided by Global (the “Assumptions”), all of which are shall be confirmed in writing by the Parties. The Assumptions will be based on a Project comprised of five (5) Systems. If at the end of the Interim Period the actual results of the operation of the Demonstration Plant indicate that some or all of the

Execution Copy 17

Assumptions are not accurate and need to be modified, the Parties shall review the impact of all such differences (positive and negative) as a whole through the use of an agreed pro forma model and modify the fixed percentage for the Royalty to compensate Covanta for any overall deterioration in Project economics caused by all of the modifications required to the Assumptions. Once a change in the fixed percentage for the Royalty has been agreed, the Parties shall amend this Agreement to reflect such revised fixed percentage. If the Parties cannot agree on the modification to be made to the fixed percentage within sixty (60) days following the end of the Interim Period, either Party may treat such failure to agree as a Dispute and require it be resolved in accordance with the procedures set forth in Article 9.

Section 5.4 Sale of Systems to Governmental Organizations. If Covanta sells one or more Systems to a Governmental Organization, Covanta shall be obligated to pay Global the Royalty in connection with the operation of such Project and Covanta shall price such obligation into the cost of operating such Project for the Governmental Organization. If the Governmental Organization wants to retain the diesel fuel produced by the Project for its own use, then the Parties shall agree on a method of valuing the diesel for purposes of determining the Royalty or adopt an alternative way of calculating the Royalty for such Project. In connection with a sale of Systems to a Governmental Organization, Covanta will disclose to the Governmental Organization Covanta’s obligation to pay such Royalty to Global and the Use License (as defined in the License Agreement) which is provided to the Governmental Organization for such Project or some other agreement that benefits Global will obligate the Governmental Organization to pay the Royalty to Global if Covanta’s agreement to operate such Project is terminated for any reason.

ARTICLE 6 – EFFECTIVE DATE AND TERM

Section 6.1 Effective Date. This Agreement shall become effective as of the date and year first above written (the “Effective Date”) so long as all of the conditions specified in Article III have been satisfied or waived by the Parties.

Section 6.2 Term of the Agreement. This Agreement shall continue in effect from the Effective Date until December 31, 2047 unless it is terminated earlier by either Party in accordance with the provisions of this Agreement or by the mutual written agreement of the Parties.

ARTICLE 7 – TERMINATION

Section 7.1 Termination Rights. This Agreement may be terminated by either Party in the case of the failure of the other Party to fulfill any of its material obligations hereunder (a “Default”) on ninety (90) days’ prior written notice to the Party in Default, such notice to specify the performance failure of such Party. Such termination shall not affect any of the obligations of the Parties in existence on the date of such termination, including (i) any existing obligations of Covanta to pay Royalties, (ii) any existing obligations of the

Execution Copy 18

Parties in respect of existing Project Companies and (iii) any existing obligations of the Parties in respect of any of the projects jointly being pursued by the Parties which are the subject of other agreements that have been entered into by the Parties.

Section 7.2 Cure Rights. Notwithstanding anything contained herein to the contrary, a Party that is in Default shall be entitled to cure such Default by satisfying its performance obligation prior to the end of such ninety (90) day period. Furthermore, if such Party is diligently proceeding to cure such Default but such cure cannot be accomplished within such ninety (90) day period, the Party in Default shall be given up to an additional sixty (60) days to cure the Default so long as such Party continues to diligently pursue curing the Default. If the Default is cured by the Party that is in Default prior to the end of the cure period, then the notice of termination shall be null and void. If a Party fails to cure a Default, then this Agreement shall terminate on the date set forth in the notice of Default, but in no event prior to ninety (90) days following the issuance of such notice of Default.

ARTICLE 8 – REMEDIES

Section 8.1 Injunctive Relief and Specific Performance. The Parties acknowledge and agree that irreparable damage might occur if any of the provisions of this Agreement are not performed in accordance with their specific terms or are otherwise breached. It is therefore agreed that each of the Parties will be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in any court of the United States located in the State of New York or in any New York state court, this being in addition to any other remedy to which such Party is entitled at law or in equity.

Section 8.2 Limitation of Liability. The Parties expressly waive any claims against each other and their respective Affiliates for indirect, special, non-compensatory, incidental, punitive, exemplary or consequential damages of any type, whether arising in contract or tort (including negligence, whether sole, joint or concurrent or strict liability), arising out of or relating to this Agreement or a breach hereof; provided, however, that this provision shall not waive any claims that the Parties may have under any other agreements entered into between the Parties. The limitations on liability and the remedies set forth in this Agreement have been expressly bargained for by the Parties and reflect the knowing allocation of the risks inherent in this Agreement between the Parties.

ARTICLE 9 – RESOLUTION OF DISPUTES

Section 9.1 Dispute Resolution. The Parties agree to cooperate with each other in good faith to try to resolve any controversy or dispute between them arising under this Agreement (each a “Dispute”) in accordance with the following procedures:

     (a) If a Dispute cannot be resolved informally, such Dispute shall initially be referred, through written notice by one Party to the other Party, to a meeting of senior

Execution Copy 19

management representatives of the Parties. The senior management representatives will meet to resolve the Dispute within fifteen (15) days following presentation of the matter to them.

     (b) If the Dispute cannot be resolved pursuant to Section 9.1(a), the Chief Executive Officers of the Parties shall meet to resolve the Dispute within fifteen (15) days following the conclusion of the consideration of the Dispute under Section 9.1(a) .

     (c) If the matter is not resolved within thirty (30) days of the written notice in Section 9.1(a), either Party may submit the Dispute to arbitration by submitting a Request for Arbitration pursuant to Article 4 of the Rules of Arbitration of the International Chamber of Commerce (the “ICC”) or such equivalent arbitration rules of the ICC then in effect (the “ICC Rules”), provided that nothing in this Agreement shall prevent or delay either Party from applying for interim or conservatory measures pursuant to Article 23 of the ICC Rules.

Section 9.2 Arbitration of Unresolved Disputes.

     (a) All Disputes arising out of or in connection with this Agreement that are not resolved in accordance with the provisions of Section 9.1 shall be finally settled under the ICC Rules by binding arbitration conducted in the English language and held in Washington, D.C. before a panel of three (3) arbitrators. Notwithstanding anything to the contrary in the ICC Rules, the following procedures shall apply for the appointment of the three (3) arbitrators. Each Party shall appoint one (1) arbitrator, obtain its appointee’s acceptance of such appointment and deliver written notification of such appointment and acceptance to the other Party within thirty (30) days from the date that the Dispute was submitted to arbitration. If a Party fails to deliver written notification of its appointment of an arbitrator and his/her acceptance within the time period provided in this Section 9.2, then such arbitrator shall be appointed by the ICC in accordance with the ICC Rules and be deemed a Party-appointed arbitrator for all purposes hereof. The first two arbitrators so selected shall select the third arbitrator (who shall act as chairman of the arbitration proceedings), prior to the thirtieth (30^th) day following the appointment of the second Party-appointed arbitrator. If the Party-appointed arbitrators are unable to select a neutral arbitrator, they shall jointly submit a list of four names (two each) to the ICC, which shall select the third arbitrator from the list submitted to it.

     (b) No arbitrator shall be a past or present employee or agent of, or consultant or counsel to, a Party or any Affiliate of a Party, unless such restriction has been waived in writing by the other Party to the proceeding.

     (c) The substantive law governing the Dispute shall be the laws of the State of New York.

     (d) The arbitrators shall have the sole power and authority to determine the arbitrability of any Dispute arising under or relating to this Agreement or the subject matter hereof. Subject to any other relevant limitations set forth elsewhere herein, the

Execution Copy 20

arbitrators will have the power to award any type of relief that is just and appropriate in the arbitrators’ discretion, including compensatory damages, injunctive orders, orders for specific performances and declarations of rights.

     (e) The arbitrators shall not have power, however, to award punitive, consequential, exemplary or treble damages or any other type of relief in the nature of a penalty, and the Parties hereby expressly waive any right they might otherwise have to such relief. THE PARTIES HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY WITH RESPECT TO ANY DISPUTE ARISING OUT OF OR RELATING TO THIS AGREEMENT.

Section 9.3 Finality; Enforcement. Any decision or award of a majority of an arbitral panel, as applicable, shall be final and binding upon the Parties. Each Party agrees that the arbitral award may be enforced against it or its assets wherever they may be found and that a judgment upon the arbitral award may be entered in any court having jurisdiction thereof. The Parties hereby waive any right to appeal or to review of the decision or the award of an arbitral panel by any court or tribunal and also waive any objections to the enforcement of such decision or award.

Section 9.4 Costs. The costs of arbitration shall be paid in accordance with the decision of the arbitral panel pursuant to the ICC Rules.

Section 9.5 Continuing Performance Obligations. The existence of any Dispute or the pendency of the Dispute resolution procedures set forth herein will not relieve or excuse a Party from its ongoing duties and obligations under this Agreement, and the Parties shall nevertheless proceed with the performance of this Agreement in accordance with the terms hereof.

ARTICLE 10 – REPRESENTATIONS AND WARRANTIES

Section 10.1 Party Representations. As of the Effective Date, each Party represents and warrants to the other Party that:

     (a) It is duly organized and validly existing and, where applicable, is in good standing under the laws of the jurisdiction of its formation and it has all requisite power and authority to enter into and perform its obligations under this Agreement;

     (b) The execution, delivery and performance of this Agreement have been authorized and approved by its Board of Directors and do not and will not (i) violate any law, rule, regulation, order, decree or permit which is applicable to it or (ii) violate its organizational documents or any agreement to which it is a party;

     (c) This Agreement is a legal and binding obligation of such Party, enforceable against such Party in accordance with its terms, except to the extent enforceability is modified by bankruptcy, reorganization and other similar laws affecting the rights of creditors generally and by general principles of equity; and

Execution Copy 21

     (d) There is no litigation pending or, to the best of its knowledge, threatened to which such Party, its parent or any of its subsidiaries is a party that, if adversely determined, would have a material adverse effect on the financial condition, prospects or business of such Party or its ability to perform its obligations under this Agreement.

Section 10.2 Additional Representation by Global. As of the Effective Date, Global is not in discussions with any Competitor of Covanta relating to the Technology.

ARTICLE 11 – GENERAL PROVISIONS

Section 11.1 Expenses. Except as is otherwise expressly provided in this Agreement, each Party will bear its respective expenses incurred in connection with the preparation, execution and performance of this Agreement.

Section 11.2 Confidentiality. The Parties agree to maintain the confidentiality of this Agreement and the terms and conditions hereof. Any public announcements or similar publicity with respect to this Agreement shall be issued at such time and in such manner as the parties shall jointly determine. Notwithstanding the foregoing, each Party (and its Affiliates) shall have the right to make all such disclosures as required by applicable law or by any governmental body, including any stock exchange or securities market to whose regulations or disclosure requirements a Party is subject, without the consent of the other Party hereto; provided, however, that in the event of any such required disclosure, the disclosing Party (and its Affiliates), to the extent reasonably practicable, shall provide the other Party with advance notice of any such disclosure and an opportunity to comment thereon. The parties acknowledge that it is their intent to limit, to the fullest extent possible, any publicity regarding their joint cooperation during the Interim Period, it being recognized, however, that Covanta will need to contact public officials in connection with securing permits or other approvals for the Demonstration Plant. In such regard, Covanta will undertake to obtain assurances of confidentiality from such public officials, but disclosures may nevertheless result.

Section 11.3 Notices. All notices, consents, waivers and other communications under this Agreement must be in writing and will be deemed to have been duly given when (i) delivered by hand (with written confirmation of receipt), (ii) sent by telecopier (with written confirmation of receipt), provided that a copy is mailed by registered mail, return receipt requested, or (iii) when received by the addressee, if sent by a nationally recognized overnight delivery service (receipt requested), in each case to the appropriate addresses and telecopier numbers set forth below (or to such other addresses and telecopier numbers as a party may designate by notice to the other parties):

Execution Copy 22

Global:

Global Energy, Inc.

Moshe Aviv Tower, 38^th Floor

Ramat Gan 52520, Israel

Attention: Asi Shalgi

Facsimile: +972-77-202-5445

Covanta:

Covanta Energy Corporation

c/o Covanta Holding Corporation

40 Lane Road

Fairfield, NJ 07004, USA

Attention: General Counsel

Facsimile: +1-973-882-7357

Section 11.4 Waiver. Neither the failure nor any delay by either Party in exercising any right, power or privilege under this Agreement shall operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power or privilege will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege. To the maximum extent permitted by applicable law, (i) no claim or right arising out of this Agreement can be discharged by one Party, in whole or in part, by a waiver or renunciation of the claim or right unless in a writing signed by the other Party, (ii) no waiver that may be given by a Party will be applicable except in the specific instance for which it is given and (iii) no notice to or demand on one Party will be deemed to be a waiver of any obligation of such Party or of the right of the Party giving such notice or demand to take further action without notice or demand as provided in this Agreement.

Section 11.5 Entire Agreement and Modification. This Agreement supersedes all prior agreements between the Parties with respect to its subject matter and constitutes a complete and exclusive statement of the terms of the agreement between the Parties with respect to its subject matter. This Agreement may not be amended except by a written agreement executed by the Party to be charged with the amendment.

Section 11.6 Assignment. Neither Party may assign its rights under this Agreement, in whole or in part, without the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed, except that each Party may make an assignment of this Agreement to an Affiliate (so long as such Party remains liable for its obligations hereunder following such assignment) and each Party may make a collateral assignment of its rights hereunder to one or more lender(s) in connection with the financing being arranged by such Party. In the case of a collateral assignment by one Party to one or more lenders, the other Party shall, if requested to so, negotiate the terms of a consent to assignment in good faith and enter into such consent without delay. Notwithstanding the

Execution Copy 23

foregoing, a Party may withhold its consent in the case of a proposed assignment to a Person that is a Competitor of the Party whose consent is being sought.

Section 11.7 Severability. If any provision of this Agreement is held to be invalid, illegal or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of this Agreement held invalid, illegal or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid, illegal or unenforceable.

Section 11.8 Governing Law. This Agreement will be governed by, and construed in accordance with the laws of, the State of New York without regard to its conflicts of law (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law).

Section 11.9 No Power of Representation. Neither Party shall have the authority or right under this Agreement to, nor shall either Party hold itself out as having the authority or right under this Agreement to, (i) assume, create or undertake any obligation of any kind whatsoever, express or implied, on behalf of or in the name of the other Party without the express prior written consent of such other Party or (ii) accept service of any legal process addressed to or intended for such other Party.

Section 11.10 No Partnership. Nothing in this Agreement shall be construed as creating a partnership, association, joint venture or any other legal entity between the Parties (including their Affiliates), nor a fiduciary relationship between the Parties (including their Affiliates).

Section 11.11 No Third Party Beneficiaries. No provision of this Agreement is intended or is to be construed to confer upon any Person, other than the Parties and their respective Affiliates and successors and permitted assigns, any rights or remedies under or by reason of this Agreement.

Section 11.12 Compliance with Law. Each Party and its Affiliates shall comply with all applicable laws, including the Foreign Corrupt Practices Act of 1977 of the United States of America (15 U.S.C. §§ 78dd-1, et seq.), in its or their performance of any activities hereunder.

Section 11.13 Counterparts and Facsimile Signatures. This Agreement, and any other agreement, instrument, certificate of other documents desirable to be executed and delivered in order to consummate the Contemplated Transactions, may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. Any such document may be executed by facsimile signature.

[Signature page follows]

Execution Copy 24

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

GLOBAL ENERGY, INC.
By:	/s/ Asi Shalgi
	Asi Shalgi, Chief Executive Officer
COVANTA ENERGY CORPORATION
By:	/s/ Timothy J. Simpson
	Timothy J. Simpson, Executive Vice
	President and General Counsel

Execution Copy 25

EXHIBIT 1 – KEY TERMS OF LLCA

Newly Formed Entity:	As is provided for in Section 2.3(g), Covanta shall form a separate limited liability company (the “Project Company”) for each Project that is to be owned jointly by Covanta and Global.
State of Organization:	Unless the Parties agree otherwise, the Project Company shall be formed under the laws of the State of Delaware and shall be authorized to do business in all such other states as required for the ownership and operation of the Project.
Members:	The members of the Project Company (the “Members”) shall be Covanta or its Affiliate and Global or its Affiliate.
Board of Managers:	The business and affairs of the Project Company shall be managed and directed by a board of managers (the “Board of Managers”) consisting of three (3) individual Managers, each entitled to one vote. So long as Global has committed to invest at least twenty percent (20%) of the total equity required for the Project in the Project Company (the “Total Required Equity”), Covanta shall appoint two (2) of the Managers and Global shall appoint (1) of the Managers. If Global has committed to invest less than twenty percent (20%) of the Total Required Equity, Global shall not have the right to appoint a Manager and Covanta shall appoint all of the Managers of the Project Company. If Global has committed to invest at least twenty percent (20%) of the Total Required Equity and Global fails to actually fund at least such percentage, Global shall lose its right to appoint one of the Managers thereafter.
Meetings of Board:	The Board of Managers may take actions by the unanimous consent of the Managers without a meeting or by a majority vote at any regular or special meetings, subject to at least fifteen (15) days’ prior notice for special meetings to allow all the Managers to be present at the meeting. The presence of two Managers shall constitute a quorum for the Board of Managers to vote on matters; provided, however, that the Board of Managers shall not be authorized to vote on any matter that requires a Unanimous Decision (defined below) unless the Manager that is designated by Global attends the meeting (but only if Global is authorized to appoint one of the Managers as provided for herein).

Execution Copy 26

Unanimous Decisions:	The following decisions shall require the unanimous vote of the Board of Managers (each a “Unanimous Decision”):
	(i)	Any consolidation, liquidation, reorganization, winding-up, merger or sale of the Project Company;
	(ii)	A transfer, assignment or sale of all or substantially all of the assets or business of the Project Company;
	(iii)	Any action that would alter or change any of the rights, privileges, obligations or liabilities or Global or dilute the voting interest of Global;
	(iv)	The incorporation, establishment or acquisition of an ownership interest in any other entity;
	(v)	Entering into any partnership or joint venture;
	(vi)	Decisions regarding tax elections, the adjudication of tax disputes, the settlement of tax disputes and other tax matters of the Project Company to the extent any such decision could have a material adverse effect on Global;
	(vii)	The offering of equity interests in the Project Company on a public securities market;
	(viii)	Any material modification or amendment to the Certificate of Formation of the Project Company or  the LLCA; and
	(ix)	Any contract or other transaction entered into by the Project Company and a Member or any Affiliate of a Member.
Cessation of Operations:	Notwithstanding anything contained herein to the contrary, Covanta shall have the unilateral right to cease operating the Project as provided for in Section 5.1(d) of the Business and Royalty Agreement, following which the Parties shall cooperate together in good faith to decide how to dispose of the Project or the Project Company. If the Parties cannot agree, Covanta shall be entitled to dispose of the Project or the Project Company in a commercially reasonable manner. In such event, Global’s Manager shall be deemed to have consented to any such commercially reasonable sale of the Project and/or a consolidation, liquidation, reorganization,

Execution Copy 27

	winding-up, merger or sale of the Project Company under clause (i) of the Unanimous Decisions provision above. It is further agreed that any such sale of the Project or of the Membership Interests in the Project Company shall not be subject to any of the Restrictions on Transfer provisions or the Right of First Refusal provision set forth below.
Ownership:	All property, assets and work product which is developed by the Project Company shall be owned by and in the name of the Project Company and not in the name of any of the Members or Managers.
Minimum Ownership:	If Global makes a commitment to provide a portion of the Total Required Equity and Global later fails to fund all or a portion of its equity investment as such funds are required for the Project and if, as a result of such failure, Global’s membership interest falls below the minimum investment of ten percent (10%) of the Total Required Equity, Covanta shall have the right to require Global to sell its entire membership interest in the Project Company to Covanta at a price equal to seventy-five percent (75%) of the amount actually invested by Global in respect of such membership interest.
Pro Rata Interests:	The Members shall be entitled to their pro rata share of each item of income, gain, loss, deduction and credit derived by the Project Company and to their pro rata share of the net distributable cash flow of the Project Company.
Officers:	The Board of Managers will have the authority to designate officers of the Project Company, which shall consist of at least a President, a Secretary and a Treasurer. The Board of Managers may appoint such other officers and agents as it shall deem necessary or advisable, who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Managers. Neither the Managers nor the officers shall receive compensation for their services to the Project Company in such capacities.
Employees:	The Project Company shall not have any employees. All services shall be performed under service contracts by third parties.

Execution Copy 28

Limitation of Liability:	None of the Members, Managers and officers of the Project Company shall be obligated personally for any of the debts, obligations or liabilities of the Project Company solely by reason of being a Member, a Manager or an officer of the Project Company.
Tax Status:	It is the intention of the Members that the Project Company be treated as a partnership for federal tax purposes and all relevant state tax purposes, where possible.
Restrictions on Transfer:	Each Member may sell or transfer all or a portion of its membership interest in the Project Company to a third party, subject, however, to the Right of First Refusal of the other Member as set forth below.
	Notwithstanding the foregoing, any Member may transfer its economic interest in such Member’s ownership interest in the Project Company to an Affiliate; provided, however, that such transfer shall give the transferee only the right to receive distributions, income, gain and loss allocable to such Member’s ownership interest to which such Member would otherwise be entitled.
Right of First Refusal:	If any Member wishes to sell its membership interest in the Project Company to a non-Affiliate, such offering Member shall first offer to sell its membership interest to the other Members by delivering notice which shall include the terms of the offer. Each other Member shall have the right to purchase all of the membership interest so offered. If none of the Members accept the offer, the offering Member may transfer all of its membership interest to a third party on terms no more favorable to the third party than those originally offered to the other Members, subject to the consent of the other Members as provided above.
Dispute Provision:	Unless the Parties agree otherwise, the dispute provisions set forth in Article 9 of the Agreement shall be incorporated in the LLCA.

Execution Copy 29

EXHIBIT 2 – FORM OF EQUITY COMMITMENT LETTER

[COVANTA LETTERHEAD]

____________ __, 20__

Mr. ________________
[Global Energy, Inc. or Relevant Affiliate]
Moshe Aviv Tower, 38^th Floor
Ramat Gan 52520, Israel

Re: Equity Commitment

This letter will confirm the commitment of [Global Energy, Inc., a Delaware corporation] (“Global”), to invest equity in the project being developed by [Covanta Energy, Inc., a Delaware corporation] (“Covanta”) in the ___________________project (the “Project”) being developed in _____________________.

Covanta [has formed/will form] a limited liability company (the “Project Company”) under the laws of the State of Delaware and [has qualified/intends to qualify] the Project Company to do business in _______________.

Covanta estimates that the total capital cost of the Project, including all the development costs, engineering, procurement and construction costs, start-up costs and initial working capital, is $__________ (the “Total Required Equity”). The current capital cost budget is attached hereto as Schedule 1. Covanta shall update the capital cost budget from time to time as the development of the Project proceeds and provide such updates to Global.

A tentative schedule for the funding of the Total Required Equity, on a monthly basis, is attached hereto as Schedule 2. Covanta shall update the funding schedule from time to time as the development of the Project proceeds and provide such updates to Global.

Global hereby acknowledges and agrees that the Total Required Equity and the tentative equity funding schedule are estimates and that the ultimate equity investment and equity funding schedule shall be what is actually required for the Project once a Purchase Order is to be issued and construction of the Project is to proceed.

Global has notified or advised Covanta that it wants to invest ______ percent (__%) of the Total Required Equity. [As the percentage is less than twenty percent (20%) of the Total Required Equity, Global shall not have the right to appoint an individual to the Board of Managers of the Project Company.] [This sentence shall only be included in the

Execution Copy 30

letter if Global commits to invest less than twenty percent (20%) of the Total Required Equity.]

Once the development of the Project advances to a point where Covanta believes that the Project is likely to proceed, Covanta will prepare a draft of the limited liability company agreement (the “LLCA”) for the Project Company based on the model agreement that was negotiated by the parties under the Business and Royalty Agreement and provide it to Global for review. Thereafter, the parties shall cooperate together in good faith to negotiate and finalize the terms of the LLCA.

In connection with the Project, the parties have further agreed as follows:
____________________________________________________________________________________________________________________________.

Please confirm the amount of your equity commitment and your acceptance of the other terms of this equity commitment letter agreement by signing in the space provided below and returning it to me within thirty (30) days of the date hereof.

Sincerely yours,

Name:

Title:

[Covanta Energy, Inc.]

[Global Energy, Inc.] hereby confirms that it will provide ________ percent (__%) of the Total Required Equity and that it agrees with all the terms of this equity commitment letter agreement.

By:

Name:

Title:

Date:

Execution Copy 31

SCHEDULE 1 – TOTAL CAPITAL BUDGET

SCHEDULE 2 – PRELIMINARY EQUITY FUNDING SCHEDULE

Execution Copy 32

EX-10.25

THE SYMBOL “*****” DENOTES PLACES WHERE PORTIONS OF THIS DOCUMENT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. SUCH MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

Exhibit 10.25

LICENSE AGREEMENT

     This License Agreement (this “Agreement”) is made and entered into as of the 6^th day of February, 2008, by and between AlphaKat - Global Energy GmbH, a company organized and existing under the laws of Germany (“Licensor”), and Covanta Energy Corporation, a corporation organized and existing under the laws of the State of Delaware (“Covanta”).

     WHEREAS, AlphaKat GmbH, a company organized and existing under the laws of Germany (as further defined below, “AK”), has granted certain rights to Licensor with respect to a proprietary technology to convert waste material that contains hydrocarbons into diesel oil (as further defined below, the “Technology”) in various countries, including the United States, China, the United Kingdom and the Republic of Ireland;

     WHEREAS, Covanta is interested in obtaining license rights from Licensor with respect to the Technology, all on the terms and conditions set forth herein; and

WHEREAS, Licensor is willing to grant such license rights to Covanta, all on the terms and conditions set forth herein;

NOW, THEREFORE, in light of the mutual premises set forth herein and other good and valuable consideration, the receipt and the sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows.

ARTICLE 1 – DEFINITIONS AND INTERPRETATION

Section 1.1 Capitalized Terms. Unless otherwise specified herein, the following capitalized terms shall have the following meanings:

     “Affiliate” means, in relation to any Person, any other Person that controls, is controlled by, or is in common control with, such Person. For the purpose of this definition, control means the direct or indirect control of fifty percent (50%) or more of the voting rights in such Person or the power to direct the management or policies of such Person, whether by operation of law, by contract or otherwise. Except as shall otherwise be expressly provided in this Agreement, and for the avoidance of any doubt, as of the Effective Date, (i) Licensor and AK are Affiliates and (ii) Licensor and Global are Affiliates, but AK and Global are not Affiliates.

     “Agreement” has the meaning set forth in the first paragraph hereof.

     “AK” means AlphaKat GmbH, a company organized and existing under the laws of Germany, and its successors and permitted assigns.

     “Commercial Waste” means all non-hazardous solid waste that is collected from commercial establishments, including residential apartment buildings, office buildings, restaurants, industrial parks, all other business facilities and all recyclable materials from recycling facilities.

     “Competitor” means a Competitor of Covanta or a Competitor of Licensor, as the context requires.

     “Competitor of Covanta” means a Person, directly or through Affiliates, engaged primarily in the waste disposal business, including the energy from waste business.

     “Competitor of Licensor” means a Person, directly or through Affiliates, engaged primarily in the business of selling equipment that converts waste or organic feedstock(s) containing hydrocarbon materials into diesel fuel or any Person that is involved primarily in the development of such equipment or the technology on which it is based.

     “Contracted Waste” means all non-hazardous waste, regardless of the source of such waste, which is under contract to be delivered to Covanta or any of its Affiliates for disposal in, or processing by, one of the facilities owned or operated by Covanta or any of its Affiliates.

     “Covanta” has the meaning set forth in the first paragraph hereof and includes its successors and permitted assigns.

     “Default” has the meaning set forth in Section 10.1.

     “Demonstration Plant” has the meaning set forth in Section 2.2.

     “Dispute” has the meaning set forth in Section 9.1.

     “Document Package” has the meaning set forth in Section 4.5(b)(iii) .

     “Effective Date” has the meaning set forth in Section 5.1.

     “Extended Period” means the period that begins on the date that the Initial Period ends and terminate on the fifth (5^th) anniversary thereof, as further provided for in Section 2.1(b) .

     “Feedstock” means Household Waste, Contracted Waste, Commercial Waste or Radial Biomass, as the case may be.

     “Full Right” means that the Person being granted the right(s) described herein shall be the only Person that is entitled to exercise such right(s) so long as this Agreement is in effect and that no other Person shall be authorized, by the grantor of such right(s), to exercise such right(s) or be granted such right(s).

2

     “Global” means Global Energy, Inc., a Nevada corporation.

     “Governmental Organization” has the meaning set forth in Section 2.5.

     “Household Waste” means all non-hazardous, post-recycled municipal solid waste which is collected from residences, which waste is of the type normally accepted for processing at waste to energy facilities in the United States, China, the United Kingdom or the Republic of Ireland, as the case may be.

     “ICC” means the International Chamber of Commerce.

     “ICC Rules” has the meaning set forth in Section 9.1.

     “Improvements” means all the techniques, enhancements, modifications, changes, experience, methods, information, data or knowledge that will be created or acquired in the future relating to the Technology and/or the manufacturing of such components for Systems (whether or not patentable, useful or workable) through the implementation, development, testing and improvement of the Technology.

     “Initial Period” means the period which begins on the date that the Interim Period ends and terminates on the tenth (10^th) anniversary thereof.

     “Intellectual Property” means any intellectual property and/or proprietary information and materials relating to the Technology along with all rights therein, whether existing before or conceived or developed after the Effective Date (except as otherwise expressly provided), including: (i) patents, patent applications, patent disclosures and inventions (whether or not patentable and whether or not reduced to practice), including the Patents; (ii) trademarks, service marks, trade dress, trade names, corporate names, logos, slogans and Internet domain names, together with all goodwill associated with each of the foregoing; (iii) copyrights and copyrightable works; (iv) trade secrets, confidential information and know-how (including ideas, formulae, compositions, manufacturing and production processes and techniques, research and development information, test data and results, drawings, specifications, designs, supplier lists and related information); and (vi) registrations, applications, divisionals, continuations, continuations-in-part, foreign counterparts and renewals for any of the foregoing.

     “Interim Period” means the period which begins on the Effective Date and ends twelve (12) months following the date that the Demonstration Plant has been successfully commissioned and is ready for commercial operation; provided, however, that if the Demonstration Plant passes the performance test agreed to by the Parties as provided for in Section 2.2(c) more than thirty (30) days prior to the scheduled end of the Interim Period, the Interim Period shall terminate thirty (30) days following the date that the Demonstration Plant has passed such performance test.

3

     “KDV 500” means the system of components, including all of the structural steel, piping, pumps, vessels, control systems, wiring, two proprietary “mixing turbine pumps” and the operations, maintenance and start-up manuals provided by AK, to convert hydrocarbon feedstock, including any Feedstock, into diesel oil using the Technology which is capable of producing a minimum of 500 liters of diesel oil per hour.

     “Licensor” has the meaning set forth in the first paragraph hereof and includes its successors and permitted assigns.

     “Parties” means Licensor and Covanta.

     “Party” means Licensor or Covanta, as the case may be.

     “Patents” means any existing or future patent applications, patents, registrations, utility models and utility model applications relating to the Technology which are necessary or useful to manufacture or to sell, offer for sale, use or otherwise make available Systems or the components of Systems, including those set forth in Exhibit 2 attached hereto.

     “Person” means any natural person, corporation, company, partnership, business trust, governmental authority or other entity.

     “Project” means a project which is owned by Covanta, a Covanta Affiliate or a Governmental Organization, in whole or in part, to convert a Feedstock to diesel oil using the Technology in Territory A or Territory B.

     “Purchase Order” has the meaning set forth in Section 2.6.

     “Purchaser” has the meaning set forth in Section 2.6.

     “Qualified Right” means that the Person being granted the right(s) described herein shall be entitled to exercise such right(s) so long as this Agreement is in effect, but the grantor of such right(s) shall be entitled to grant such right(s) or allow such right(s) to be exercised by all other Persons except a Person that is precluded from exercising such right(s) under the express terms hereof.

     “Radial Biomass” means biomass, including wood, wood waste and other types of cellulosic materials which are collected within or from an area within a 100 mile radius of any biomass facility that is owned by Covanta or an Affiliate of Covanta in the states of California or New York as of the Effective Date.

     “Rights Agreements” means (i) the “Terms of Agreement” dated May 2, 2007, (ii) the “Shareholders’ Agreement” dated July 10, 2007 and (iii) the Articles of Association of Licensor dated November 14, 2007 and November 22, 2007, a copy of each of which is attached hereto in Exhibit 1.

4

     “System” means any system of components, whether it is in existence today or developed hereafter, including all of the structural steel, piping, pumps, vessels, control systems, wiring, the proprietary “mixing turbine pump(s),” any new components of any future system of components and all of the operations, maintenance and start-up manuals provided by AK, to convert hydrocarbon feedstock, including any Feedstock, into diesel oil using the Technology, including, for the avoidance of doubt, the KDV 500.

     “Technology” means the proprietary, renewable diesel technology developed by Dr. Christian Koch (as well as any related technology licensed to Dr. Christian Koch or to AK) to convert municipal solid waste, organic materials, sludge and other hydrocarbon materials, including Feedstock, to diesel oil, including all Improvements to such technology made or acquired from time to time, including Intellectual Property, Systems, the formulation of catalysts used in Systems and all related materials and information, including the Document Package.

     “Territory A” means the United States.

     “Territory B” means China, the United Kingdom and the Republic of Ireland.

     “Third Party Purchaser” has the meaning set forth in Section 2.6.

Section 1.2 Interpretation. In this Agreement, unless otherwise indicated or required by the context:

     (a) Reference to and the definition of any document (including this Agreement) or any applicable law shall be deemed a reference to such document or applicable law as it may be amended, supplemented, revised or modified from time to time;

     (b) All references to an “Article,” “Section” or “Exhibit” are to an Article or Section hereof or to an Exhibit attached hereto;

     (c) Article and Section headings and other captions are for the purpose of reference only and do not limit or affect the meaning of the terms and provisions hereof;

     (d) Defined terms in the singular include the plural and vice versa, and the masculine, feminine and neuter gender include all genders;

     (e) The words “hereof,” “herein” and “hereunder” and words of similar import refer to this Agreement as a whole and not to any particular provision of this Agreement; and

     (f) The words “include,” “includes” and “including” mean include, includes, and including “without limitation” and “without limitation by specification.”

5

ARTICLE 2 – LICENSE RIGHTS

Section 2.1 Grant of License Rights. Subject to the further terms of this Agreement, Licensor hereby grants the following license rights to Covanta: Until Covanta has satisfied the two (2) conditions which are set forth in Section 2.1(a) (relating to the purchase of the Demonstration Plant and an additional five (5) Systems), Covanta shall have the Qualified Right in Territory A and Territory B to use, practice and make Improvements to the Technology in connection with Projects using any Feedstock. Once Covanta has satisfied the two (2) conditions which are set forth in Section 2.1(a), Covanta shall have the following rights during the Initial Period and, if the election provided for in Section 2.1(b) is timely made by Covanta, during the Extended Period: (i) the Full Right in Territory A and the Qualified Right in Territory B to use, practice and make Improvements to the Technology in connection with Projects using Household Waste; (ii) the Full Right in Territory A and Territory B to use, practice and make Improvements to the Technology in connection with Projects using Contracted Waste; (iii) the Full Right in the applicable areas of Territory A to use, practice and make Improvements to the Technology in connection with Projects using Radial Biomass; and (iv) the Qualified Right in Territory A and Territory B to use, practice and make Improvements to the Technology in connection with Projects using Commercial Waste. As further provided for in Sections 2.5 and 2.6, Covanta shall have the right to arrange for the sale of Systems to Governmental Organizations pursuant to a Purchase Order with AK. Furthermore, nothing which is contained herein shall restrict the sale of any Project by Covanta at any time to any Person other than a Competitor of Licensor. For the avoidance of doubt, Covanta shall be entitled to exercise any or all of the license rights that are granted to it hereunder itself or through any of its Affiliates, but Covanta shall not have the right to issue sublicenses to any Person other than an Affiliate. The Parties further agree as follows:

     (a) To secure its rights hereunder, Covanta shall satisfy the following two (2) conditions: (i) issue a Purchase Order for the Demonstration Plant by the date that is specified in Section 4.5 and make the payments required pursuant to such Purchase Order as and when due thereunder; and (ii) place one or more additional Purchase Order(s) for a total of five (5) Systems (excluding the Purchase Order for the Demonstration Plant) no later than one year after the start of the Initial Period and make a down payment equal to ten percent (10%) of the Purchase Price to Licensor at the time that such Purchase Order(s) are placed for Licensor to hold in escrow pending finalization of the Purchase Order(s) between AK and Covanta, it being agreed that Licensor can release the sum of [*****] to AK for preliminary engineering work associated with the Purchase Order(s) and the balance of the deposit shall be released to AK as is provided for in the Purchase Order(s) once it is finalized by AK and Covanta. If Covanta decides, for any reason, to terminate this Agreement and to give up its license rights hereunder after placing such Purchase Order(s) and making the required down payment to Licensor, the Licensor shall refund such deposit to Covanta.

     (b) Covanta shall have the right to elect, in its sole discretion, to extend the term of the Initial Period for an additional five (5) years, (such extended term defined in

6

Section 1.1 as the “Extended Period”), Covanta to notify Licensor in writing at least ninety (90) days prior to the end of the Initial Period if it wants to extend the Initial Period for an additional five (5) years.

     (c) During the period that starts on the Effective Date and ends on the earlier to occur of (i) the termination hereof and (ii) the date that Covanta has satisfied the two (2) conditions which are set forth in Section 2.1(a), Licensor shall not (i) grant any rights to any Person (other than Global) with respect to the Technology in Territory A in connection with any projects using Household Waste or any projects using Radial Biomass or (ii) sell Systems to any Person for delivery to or use in Territory A if such Systems are to be used to process Household Waste or Radial Biomass unless each of the requirements that are specified in Section 2.1(d) are complied with.

     (d) If any Person contacts Licensor at any time during the period specified in Section 2.1(c) to purchase one or more Systems for any purpose specified in clause (ii) of Section 2.1(c), Licensor shall (i) provide a written notice of such contact to Covanta and (ii) notify such Person in writing (with a copy of such notice to Covanta) that no Systems can be sold for such purpose unless Covanta is given a “right of first offer” with respect to such Systems. The term “right of first offer” means that such Person offers Covanta, in writing, the right to invest 50 percent of the cost of the project to be developed with such Systems and to own 50 percent of such project (on an equal basis and terms with such Person) and the right to operate such project or such other arrangement acceptable to such Person and Covanta. Covanta shall notify such Person and Licensor, in writing, whether Covanta wants to be involved in such project as a 50 percent owner and operator or waive its right to do so. AK shall not enter into a Purchase Order with such Person unless Licensor has satisfied the notice requirements of this Section 2.1(d) and Covanta elects to not participate in the project.

Section 2.2 Obligations During Interim Period. During the Interim Period, Covanta shall:

     (a) Purchase and install, at its sole cost and expense, a demonstration plant (the “Demonstration Plant”) using Household Waste and/or Contracted Waste which shall be comprised of a single KDV 500 (it being agreed that Covanta shall determine, in its sole discretion, whether to order the KDV 500 with a single proprietary mixing turbine pump or two such pumps) at a site designated by Covanta in Territory A;

     (b) Use commercially reasonable efforts to permit and complete installation of the Demonstration Plant to enable it to achieve commercial operation on or before October 1, 2008, subject to the commitment of AK to deliver the KDV 500 (with one or two proprietary mixing turbine pumps as is ordered by Covanta) on or before such date and such other factors that are outside of the control of Covanta;

     (c) Working together in good faith with Licensor, within thirty (30) days of the Effective Date, develop a plan which will define the requirements for a performance test for the Demonstration Plant, including the duration of the test, the availability,

7

reliability, conversion efficiency and other relevant factors and such other parameters as the Parties and AK may agree, consistent with prudent engineering practices;

     (d) Use commercially reasonable efforts to conduct the performance test during the first six (6) months following the commissioning of the Demonstration Plant or as soon as thereafter possible;

     (e) Operate and maintain the KDV 500 (with one or two proprietary mixing turbine pumps as is ordered by Covanta); and

     (f) Notify Licensor in writing whether it wants to proceed to the Initial Period at least sixty (60) days prior to the expiration of the Interim Period, unless the Interim Period is being terminated earlier in accordance with the proviso in the definition of the term “Interim Period,” in which case such notice shall be given at least fifteen (15) days prior to the end of the Interim Period.

Section 2.3 Retention of Full Rights. In order for Covanta to retain the Full Rights in Territory A that are being granted to it by Licensor pursuant to Section 2.1, following the satisfaction of the two (2) conditions set forth in Section 2.1(a), during the Initial Period and the Extended Period, the following shall apply:

     (a) During the Initial Period, Covanta shall be required to place Purchase Orders for a number of KDV 500s, on a cumulative basis, measured at the end of each calendar year (such number to be pro-rated to account for any partial years) as follows:

Year 1	Total of 5 KDV 500s;
Year 2	Total of 20 KDV 500s;
Year 3	Total of 40 KDV 500s;
Year 4	Total of 70 KDV 500s;
Year 5	Total of 110 KDV 500s;
Year 6	Total of 170 KDV 500s;
Year 7	Total of 250 KDV 500s;
Year 8	Total of 350 KDV 500s;
Year 9	Total of 475 KDV 500s; and
Year 10	Total of 600 KDV 500s.

During the Extended Period, Covanta shall be required to place Purchase Orders for a number of KDV 500s, on a cumulative basis, measured at the end of each calendar year (such number to be pro-rated to account for any partial years) as follows:

Year 1	Total of 150 KDV 500s;
Year 2	Total of 300 KDV 500s;
Year 3	Total of 450 KDV 500s;
Year 4	Total of 600 KDV 500s; and
Year 5	Total of 750 KDV 500s;

8

     (b) For purpose of meeting any of the minimum order thresholds for KDV 500s which are set forth in Section 2.3(a), if a System is developed by AK (such as the “KDV 2000” which is currently under development by AK) that is capable of producing a higher amount of diesel oil per hour than a KDV 500 (expected to be 2,000 liters per hour in the case of a “KDV 2000” as compared to 500 liters per hour for a KDV 500), then such System will count as more than one KDV 500 based on the amount of diesel oil per hour capable of being provided (expected to be four KDV 500s in the case of a “KDV 2000”).

     (c) If the Feedstock for any Project installed by Covanta requires Covanta to secure more than 25 tons per day of Feedstock per KDV 500 to produce 500 liters per hour of diesel oil output, then the number of KDV 500s credited towards meeting the minimum order threshold for KDV 500s set forth in Section 2.3(s) in connection with such Project shall be adjusted upwards to account for the incremental Feedstock that has to be secured by Covanta. For example, if Covanta purchases five KDV 500s for a Project that will use Household Waste and Covanta has to secure 150 tons of Household Waste per day instead of 125 tons of Household Waste per day to produce 2,500 liters of diesel oil per hour from such Project, then Covanta will be credited as having ordered six KDV 500s for such Project instead of five KDV 500s.

     (d) If Covanta fails to order the minimum number of KDV 500s (or equivalent Systems) in any given year to satisfy the cumulative requirements for such year set forth in Section 2.3(a), then Covanta shall be given one year (the “Recovery Year”) to regain its Full Rights in Territory A by achieving the cumulative threshold requirement that is applicable as of the end of such Recovery Year. During the Recovery Year, Covanta’s license rights in Territory A shall be Qualified Rights with respect to Licensor. However, Licensor shall not be entitled to grant Full Rights to any other Person with respect to those rights that were formerly Full Rights of Covanta hereunder. During the Recovery Year, Licensor shall have the right to sell Systems to Persons other than a Competitor of Covanta. If Covanta satisfies the cumulative requirement at the end of the Recovery Year (or Licensor accepts that the cumulative requirement has been satisfied), Covanta shall regain it Full Rights in Territory A. If Covanta fails to regain its Full Rights during the Recovery Year, its license rights in Territory A thereafter shall be Qualified Rights thereafter.

     (e) Notwithstanding anything contained herein to the contrary, Covanta shall not lose its Full Rights in Territory A if Covanta fails to meet the cumulative order requirements in Section 2.3(a) if (i) AK is not able to produce enough Systems to meet Covanta’s Purchase Orders or (ii) any problems experienced with the Technology in the Systems installed by AK make it commercially unreasonable for Covanta to order any additional Systems until such problems are resolved, in which case the Parties shall agree to an equitable adjustment, in good faith, to the cumulative requirements provisions of Section 2.3(a) .

Section 2.4 Other Projects. Covanta is not authorized hereunder to develop a project using the Technology for a feedstock that is not included in the definition of Feedstock in

9

Territory A or Territory B or in a location (regardless of feedstock) outside of Territory A or Territory B. If Covanta wants to develop any such project, Covanta shall first be required to contact Licensor for its prior approval. Licensor shall determine whether the proposed project would violate any rights that have been granted by Licensor to any Person and, if not, whether Licensor is willing to agree to have Covanta pursue such project, any such approval to be provided in writing. Notwithstanding anything which is contained herein to the contrary, Covanta shall have the right to purchase up to ten (10) KDV 500s to install at any of Covanta’s waste to energy facilities.

Section 2.5 Sale of Systems to Certain Governmental Organization. Licensor is aware that Covanta often deals with municipalities and governmental organizations (collectively referred to as “Governmental Organizations”) which have the responsibility to dispose of waste in their jurisdiction and that such Governmental Organizations sometimes insist on owning the systems and facilities that process or dispose of such waste. In such cases, Covanta will seek to arrange for the procurement and installation of such systems and facilities and operate them under a long-term contract. If Covanta has an opportunity to sell one or more Systems to a Governmental Organization that insists on owning such Systems, Covanta shall be entitled to arrange for the sale of such Systems pursuant to a Purchase Order as provided for in Section 2.6, but only if Covanta or one of its Affiliates has entered into an agreement with the Governmental Organization providing that the Systems will be operated by Covanta for a minimum period of ten (10) years.

Section 2.6 Purchase Orders. All purchase orders for System(s) (“Purchase Orders”) shall be entered into by and between AK (or its designee) and the ultimate purchaser of such System(s) (the “Purchaser”), although all Purchase Orders shall be placed through Licensor. Each Purchase Order shall include a set of representations and warranties made by AK to the Purchaser which are consistent with those provided by Licensor to Licensee in Article 8 and a non-exclusive, irrevocable and perpetual license (a “Use License”) for the Purchaser to (i) use, practice, operate, maintain, repair and make Improvements to the System(s), (ii) purchase the catalyst that is required for the operation of the System(s) from AK and/or any Person that is authorized to manufacture and/or sell such catalyst by AK, (iii) purchase components and spare parts for the System(s) from AK and/or any Person that is authorized to manufacture and/or to sell such components and spare parts and (iv) reproduce, modify and internally distribute copies of any and all materials and information received by Licensee from Licensor and/or AK relating to the System(s), in whole or in part. In addition, if the Purchaser sells or transfers any of the System(s) to any Person (a “Third Party Purchaser”), the Purchaser shall be entitled to transfer its Use License to such Third Party Purchaser and each Third Party Purchaser shall be entitled to transfer such Use License to another Third Party Purchaser. Notwithstanding anything to the contrary contained or implied in clauses (ii) or (iii) of this Section 2.6, all Purchasers and all Third Party Purchasers shall be entitled to procure components, spare parts and catalysts that are commercially available from any Person. Further, if AK and the Persons authorized to make spare parts and components that are not commercially available are unable to timely supply the spare parts and components ordered by a Purchaser or a Third Party Purchaser, such Purchaser or Third Party Purchaser shall be

10

authorized to purchase such spare parts and components from any other Person and to make such spare parts and components itself.

ARTICLE 3 – CONSIDERATION

Section 3.1 System Price of Demonstration Plant. The purchase price of the KDV 500 to be ordered for the Demonstration Plant shall be [*****], which includes the cost of the equipment and components that are required to recover the catalyst, and the cost of delivering the KDV 500 to the Demonstration Plant site in the United States, assembling it, starting it up and making it ready for commercial operation. Such price does not include (i) a [*****] percent sales commission due to Licensor or others, (ii) the additional cost for any sulfur reduction equipment or (iii) the additional cost for the equipment that is needed to process the Feedstock. Licensor agrees that no commission shall be due to it with respect to the Demonstration Plant. If Covanta decides to order the KDV 500 with a single proprietary mixing turbine pump, the price of the KDV 500 shall be [*****].

Section 3.2 Sulfur Reduction Equipment. If sulfur reduction equipment is required for the Demonstration Plant, Covanta shall have the right to require AK to provide such equipment as part of the System being delivered, assembled, started up and made ready for commercial operation, the cost of which shall not exceed [*****].

Section 3.3 Reduction in Cost of Systems. Licensor anticipates that the base price of Systems will decrease as AK expands the production facilities for manufacturing Systems and puts arrangements in place with third party suppliers for pipes, valves and other basic components of the System that can be purchased from such third party suppliers and once it is no longer necessary for Licensor to build and test each System and then disassemble it for shipment. Licensor and Covanta will cooperate together in good faith and with AK to seek ways to help reduce the cost of manufacturing and delivering Systems.

Section 3.4 Annual Pricing. Licensor, Covanta and AK shall agree on a procedure to establish the price, at the end of each November, for the following year, of (i) Systems, (ii) the catalyst that is used with the Technology, (iii) replacement/spare parts for Systems and (iv) the cost for AK or Licensor to provide services on Systems or other engineering services in order to (a) ensure that such prices are not increased inappropriately from year to year and (b) to provide price certainty to Covanta for the upcoming year in connection with the Projects that it has under development. The Parties are aware that the current price of a KDV 500 includes a technology fee of [*****] and acknowledge that the minimum technology fee to AK from the sale of a System in the future, as arrangements are put in place by AK to broaden the manufacturing base and reduce the total cost of the Systems will include a technology fee not to exceed [*****]. Licensor, Covanta and AK shall use their best efforts to negotiate in good faith and agree as soon as practicable to the terms of such procedure and any other mechanisms that may be necessary or helpful to determine the pricing for the Systems or any other items. Licensor shall provide Covanta, prior to the end of each November, with the updated pricing for the following year. Licensor further agrees (and AK, by its execution of this Agreement in the space provided below, agrees) that Covanta will not be charged more during any year for a

11

purchase of one or more Systems for delivery in a country than the lowest price that is paid by any other licensee of Licensor or customer of AK for delivery in such country in connection with a purchase of a comparable number of Systems in such year.

Section 3.5 No Royalties. Neither Covanta (or its Affiliates) nor any Purchasers or Third Party Purchasers shall be required to pay royalties to Licensor, AK, Global or any other Person in connection with the exercise by Covanta or its Affiliates of any of the license rights in the Technology granted under this Agreement.

Section 3.6 Payment to AK. Upon the execution of this Agreement by Licensor and the execution of the Acknowledgment and Agreement by Dr. Christian Koch and AK in the space provided below, Covanta shall pay the sum of [*****] to AK, the full amount of such payment to AK to be credited against the Purchase Price for the Demonstration Plant under the Purchase Order for the Demonstration Plant.

ARTICLE 4 – CERTAIN OBLIGATIONS OF THE PARTIES

Section 4.1 Supply of Information. Licensor shall supply Covanta from time to time with all information relating to the installation and operation of Systems reasonably required or requested by Covanta. Further, Licensor and/or AK shall provide Covanta with any revised or updated installation or operating manuals or bulletins as soon as such materials are completed and available for distribution.

Section 4.2 Provision of Technical Assistance. Notwithstanding Section 4.1, Licensor shall not have any obligation to provide any engineering services or technical assistance regarding the Technology or the Systems under this Agreement. Any such services and assistance may be provided under other agreements with Licensor or with AK.

Section 4.3 Acknowledgment and Agreement. Licensor shall arrange for Dr. Christian Koch to execute this Agreement in the space that is provided below, on behalf of himself and in his capacity as the President of AK, to evidence (i) their acknowledgement that they have reviewed this Agreement and agree to any obligations on their parts, (ii) their consent to the terms of this Agreement and (iii) their agreement for AK to enter into a substantially similar form of license agreement with Covanta if the rights of Licensor pursuant to or as contemplated by the Rights Agreements are not supplemented to the extent necessary to enable Licensor to grant all of the rights being granted to Covanta hereunder or if any such rights granted to Licensor are terminated for any reason, such new license agreement to preserve Covanta’s Full Rights and/or Qualified Rights in Territory A and Territory B.

Section 4.4 Cooperation with Demonstration Plant. Licensor acknowledges that there are a number of Improvements that could be made with respect to the design and fabrication of the Technology that will enable the Demonstration Plant to be more effective and that feedback from the initial start-up and operation of the Demonstration Plant may yield additional possibilities for design and fabrication Improvements. Licensor agrees that Licensor and AK shall cooperate with Covanta to work on any such

12

Improvements to the Technology prior to AK completing the manufacturing of the System that is ordered for the Demonstration Plant, as well as following the delivery, start-up and operation of such System.

Section 4.5 Purchase of the System for the Demonstration Plant. Covanta shall place the Purchase Order for the System required for the Demonstration Plant, and the Parties shall cooperate with one another in good faith in connection therewith, as follows:

     (a) During the ninety (90) day period following the execution hereof, Covanta and Licensor shall perform a detailed review of the results of the testing of the facility in Eppendorf, Germany and all other relevant information that is available to the Parties and their Affiliates, and provide all such information, along with suggestions for any potential Improvements that can be made to the System, to AK to ensure that the System which is ordered for the Demonstration Plant will take into account all of such information and suggestions. During such period, it is the expectation of the Parties that they and their Affiliates will review and evaluate the mechanical process of the System and provide all information regarding such review and evaluation to AK.

     (b) During the ninety (90) day period provided for in Section 4.5(a), Licensor shall assist Covanta in negotiating the terms of the Purchase Order for the System for the Demonstration Plant with AK. The Purchase Order shall reflect the following terms and conditions and otherwise be acceptable to AK and Covanta:

(i)	A purchase price (the “Purchase Price”) consistent with the terms of this Agreement, including Section 3.1 and 3.2;
(ii)	A down payment equal to [*****] to AK by Covanta at the time this Agreement is signed as provided for in Section 3.6;
(iii)	The delivery by AK of a comprehensive package of documents for the System (the “Document Package”), including all preliminary drawings, detailed heat and material balances, interface control documents, equipment specifications, piping and instrumentation diagrams, a System manufacturing plan and such other documents as the Parties agree should be made available by AK for review by Covanta;
(iv)	Within twenty-one (21) days following the delivery of a complete Document Package, AK, Licensor and Global shall meet to review the Document Package and discuss any comments of, or changes being proposed by, Covanta and work out any final changes to the Document Package;
(v)	Within fifteen (15) days of agreeing on the Document Package, a payment of [*****]by Covanta to AK if the KDV 500 is being ordered with two proprietary mixing turbine pumps or a payment

13

	of [*****] by Covanta to AK if the KDV 500 is being ordered with only one proprietary mixing turbine pump;
(vi)	The right for Covanta to make one or more visits to AK’s facility to review the fabrication of the System to confirm that the System is being fabricated in accordance with the Document Package;
(vii)	The obligation for AK to successfully test the completed System at AK’s fabrication facility in Germany, it being agreed that Covanta shall be given at least fifteen (15) days prior written notice of such test and the right to have one or more individuals attend the test to verify that such test was successfully completed, following which AK shall disassemble the System, prepare the System for shipment and ship the System;
(viii)	A payment of fifty percent (50%) of the balance of the Purchase Price (i.e., the difference between the Purchase Price and all of the amounts paid previously by Covanta to AK, such balance amount to be referred to herein as the “Purchase Price Balance”) to AK by Covanta once the System has been successfully tested at AK’s fabrication facility, disassembled for shipment and placed on a ship for delivery to the United States;
(ix)	A payment of twenty-five percent (25%) of the Purchase Price Balance to AK by Covanta once the System has been physically delivered to the site of the Demonstration Plant and it has been erected, assembled and deemed to be mechanically complete; and
(x)	A final payment of twenty-five percent (25%) of the Purchase Price Balance to AK by Covanta once the System has passed all tests required for it to be deemed to be ready for commercial operation.

     (c) At the end of the ninety (90) day period provided for in Section 4.5(a), the Purchase Order for the System for the Demonstration Plant shall be placed by Covanta through Licensor, such Purchase Order to reflect a credit for the [*****] payment made by Covanta to AK at the time this Agreement is signed in accordance with the provisions of Section 3.6.

ARTICLE 5 – EFFECTIVE DATE AND TERM

Section 5.1 Effective Date. This Agreement shall become effective on the date that it has been signed by both of the Parties and by Dr. Christian Koch (the “Effective Date”).

14

Section 5.2 Term of the Agreement. This Agreement shall continue in effect from the Effective Date until July 1, 2028 unless it is terminated earlier by the provisions hereof or by either Party in accordance with its rights hereunder.

ARTICLE 6 – INTELLECTUAL PROPERTY

Section 6.1 No Transfer of Ownership of the Technology. The Parties agree that this Agreement shall not transfer the ownership of the Technology or any of the Intellectual Property therein, and that Covanta will not have any right, title or interest in or to the Technology, except as set forth in Section 6.2 or as expressly licensed to Covanta pursuant to this Agreement or any separate agreement.

Section 6.2 Improvements. All Improvements conceived, developed or acquired by AK or Licensor during the term hereof shall be included under the license rights granted herein. All such Improvements conceived, developed or acquired exclusively by AK or Licensor shall remain the property of AK or Licensor, respectively. All processes, components, systems or other technology, whether or not constituting an Improvement, conceived, developed or acquired exclusively by Covanta shall remain the property of Covanta.

Section 6.3 Covanta Technologies. Licensor acknowledges that Covanta is engaged in operating, developing, creating, manufacturing, marketing, reproducing, distributing, using, licensing and otherwise commercializing a variety of technologies, components and applications relating to processing waste and creating energy from a variety of waste sources. In connection with this line of business, Covanta owns or otherwise has rights in intellectual property as of the Effective Date and may acquire other ownership or rights in other intellectual property after the Effective Date. Licensor acknowledges and agrees that Covanta shall not have any obligation under this Agreement to disclose to Licensor or make available for use by Licensor any such intellectual property.

Section 6.4 Sharing of Intellectual Property. If either Party wants to expand the scope of their business relationship and disclose to the other Party intellectual property that has been independently developed or acquired, but which is not otherwise expressly covered by the terms of this Agreement and the other Party is interested in such disclosure, the Parties shall enter into a written agreement identifying such intellectual property and the terms and conditions relating to the disclosure and use thereof.

ARTICLE 7 – INFRINGEMENT AND DESIGNATIONS

Section 7.1 Notice of Infringements. During the term hereof, Licensor and Covanta shall promptly notify each other in writing with respect to any claim of infringement of any Patent or other right asserted against it by any Person arising out of the exercise of the rights being granted hereunder.

15

Section 7.2 Indemnity for Infringement or Misappropriation. Licensor shall indemnify and hold harmless Covanta, its Affiliates, any Purchasers and Third Party Purchasers (collectively, the “Indemnified Parties”) from any and all claims of infringement or misappropriation and attendant damages and costs by virtue of the exercise of the rights granted to an Indemnified Party hereunder or under any Purchase Order. To secure the indemnity provided for in this Section 7.2, the Indemnified Party shall: (i) provide notice to Licensor of the claim giving rise to the liability as soon as reasonably practicable after receiving a notice of the claim, it being agreed that any delay in providing such notice to Licensor shall not relieve Licensor of its indemnity obligations except to the extent it was prejudiced by such delay; and (ii) use reasonable business efforts to cooperate fully with Licensor in defending the claim; provided, however, that Licensor shall not enter into any settlement or compromise creating any payment obligation, admission or other obligation on the part of any Indemnified Party without such Indemnified Party’s prior written consent. The Indemnified Parties shall permit Licensor to defend and compromise such claim, but each Indemnified Party may employ its own counsel, at its own expense, to assist Licensor with respect to any such claim. Notwithstanding the foregoing, the Indemnified Parties shall not be entitled to indemnification hereunder if the infringement is due to the Indemnified Party or its Affiliates: (i) using the System in violation of the express written operating instructions that are provided by AK if the subject claim would have been avoided but for such unauthorized use; or (ii) modifying the System in a manner which is not authorized by Licensor which actually causes such infringement if the subject claim would have been avoided but for such modification.

Section 7.3 Use of Designations. If requested by Licensor in writing, Covanta shall, in accordance with the written instructions of Licensor, provide for any System or any part of the Technology, legible statutory notice of any Patent, the existence of the license herein granted and the identity of Licensor and/or AK. Notwithstanding anything contained herein to the contrary, no rights are being granted by either Party to the other regarding their respective trade names or trademarks.

Section 7.4 Limitation of Liability. The Parties expressly waive any claims against each other and their respective Affiliates for indirect, special, non-compensatory, incidental, punitive, exemplary or consequential damages of any type, whether arising in contract or tort (including negligence, whether sole, joint or concurrent or strict liability), arising out of or relating to this Agreement or a breach hereof; provided, however, that this provision shall not waive any claims that the Parties may have under any other agreements entered into between the Parties. The limitations on liability and the remedies set forth in this Agreement have been expressly bargained for by the Parties and reflect the knowing allocation of the risks inherent in this Agreement between the Parties.

ARTICLE 8 – REPRESENTATIONS AND WARRANTIES

Section 8.1 Party Representations. As of the Effective Date, each Party represents and warrants to the other Party that:

16

     (a) It is duly organized and validly existing and, where applicable, is in good standing under the laws of the jurisdiction of its formation and it has all requisite power and authority to enter into and perform its obligations under this Agreement;

     (b) The execution, delivery and performance of this Agreement have been authorized and approved by its Board of Directors and do not and will not (i) violate any law, rule, regulation, order, decree or permit which is applicable to it or (ii) violate its organizational documents or any agreement to which it is a party;

     (c) This Agreement is a legal and binding obligation of such Party, enforceable against such Party in accordance with its terms, except to the extent enforceability is modified by bankruptcy, reorganization and other similar laws affecting the rights of creditors generally and by general principles of equity; and

     (d) There is no litigation pending or, to the best of its knowledge, threatened to which such Party, its parent or any of its subsidiaries is a party that, if adversely determined, would have a material adverse effect on the financial condition, prospects or business of such Party or its ability to perform its obligations under this Agreement.

Section 8.2 Licensor Representations Regarding the Technology. As of the Effective Date, Licensor represents and warrants to Covanta, its Affiliates and each Purchaser and Third Party Purchaser that:

     (a) A list of all relevant Patents as of the Effective Date is set forth in Exhibit 2 attached hereto and all such Patents are current and valid as of the Effective Date with any and all required fees to maintain the same having been paid;

     (b) Licensor has licensed or otherwise has or otherwise will secure the rights in and to the existing and future Technology, including Intellectual Property necessary for Licensor to grant to Covanta the rights being granted in this Agreement, and there are no rights, options or other contractual obligations on the part of AK, Dr. Christian Koch or any other Person that would result in such Technology, including Intellectual Property, no longer being owned by or licensed to AK or licensed by Licensor, and AK shall maintain, prosecute and defend (or cause any other Person that owns any Patents to maintain, prosecute and defend) all Patents and pay all fees in connection therewith;

     (c) The Technology, including Intellectual Property, does not use or include or rely on any third party intellectual property and no third party owns any rights, including intellectual property rights, necessary to Covanta’s exercise of any of its rights under this Agreement that have not been licensed to AK;

     (d) Except for any rights granted to Global or to American Renewable Diesel, LLC, no rights have been provided to, or authorized for, any Person to exercise any rights in, the Technology, including the Intellectual Property, which are inconsistent with the rights granted to Covanta hereunder;

17

     (e) The Technology as currently used by AK and as planned to be used by Licensor and Covanta in accordance with the terms of this Agreement, does not infringe, misappropriate or otherwise violate any patent, copyright, trademark, trade secret or other proprietary or intellectual property right of any Person, and AK and/or Licensor have not received, and to its knowledge does not know of any facts that could give rise to, any charge, complaint, claim, demand, notice or other communication (i) alleging any such infringement, misappropriation or other violation, (ii) requesting that AK and/or Licensor take a license from any Person or (iii) challenging the validity or enforceability of the Intellectual Property. AK and/or Licensor has no knowledge of any current or threatened infringement, misappropriation or other violation by any Person of the Intellectual Property, and AK and/or Licensor has not, and has no knowledge of any facts that would require that there be, sent or otherwise communicated to any Person any charge, complaint, claim, demand or notice asserting infringement, misappropriation or other violation of any of any such Intellectual Property; and

     (f) Licensor has provided Covanta with a true and correct copy of the Rights Agreements and there has not been any amendment to the Rights Agreements since they were executed. Licensor shall provide Covanta with a true and correct copy of any amendments made to the Rights Agreements during the term hereof and a copy of any additional agreements entered into by Licensor with AK or Dr. Christian Koch regarding the rights of Licensor with respect to the Technology. Licensor shall provide Covanta with a copy of any default notice or any similar communications received by Licensor from AK during the term hereof and provide Covanta with updates from time to time regarding the resolution of any such termination notice. Licensor shall not agree to or make any amendment to any of the Rights Agreements or enter into any other agreements regarding its rights to the Technology that would reduce or affect any of Covanta’s rights under this Agreement.

ARTICLE 9 – RESOLUTION OF DISPUTES

Section 9.1 Dispute Resolution. The Parties agree to cooperate with each other in good faith to try to resolve any controversy or dispute between them arising under this Agreement (each a “Dispute”) in accordance with the following procedures:

     (a) If a Dispute cannot be resolved informally, such Dispute shall initially be referred, through written notice by one Party to the other Party, to a meeting of senior management representatives of the Parties. The senior management representatives will meet to resolve the Dispute within fifteen (15) days following presentation of the matter to them.

     (b) If the Dispute cannot be resolved pursuant to Section 9.1(a), the Chief Executive Officers of the Parties shall meet to resolve the Dispute within fifteen (15) days following the conclusion of the consideration of the Dispute under Section 9.1(a) .

18

     (c) If the matter is not resolved within thirty (30) days of the written notice in Section 9.1(a), either Party may submit the Dispute to arbitration by submitting a Request for Arbitration pursuant to Article 4 of the Rules of Arbitration of the ICC or such equivalent arbitration rules of the ICC then in effect (the “ICC Rules”), provided that nothing in this Agreement shall prevent or delay either Party from applying for interim or conservatory measures pursuant to Article 23 of the ICC Rules.

Section 9.2 Arbitration of Unresolved Disputes.

     (a) All Disputes arising out of or in connection with this Agreement that are not resolved in accordance with the provisions of Section 9.1 shall be finally settled under the ICC Rules by binding arbitration conducted in the English language and held in Washington, D.C. before a panel of three (3) arbitrators. Notwithstanding anything to the contrary in the ICC Rules, the following procedures shall apply for the appointment of the three (3) arbitrators. Each Party shall appoint one (1) arbitrator, obtain its appointee’s acceptance of such appointment and deliver written notification of such appointment and acceptance to the other Party within thirty (30) days from the date that the Dispute was submitted to arbitration. If a Party fails to deliver written notification of its appointment of an arbitrator and his/her acceptance within the time period provided in this Section 9.2, then such arbitrator shall be appointed by the ICC in accordance with the ICC Rules and be deemed a Party-appointed arbitrator for all purposes hereof. The first two arbitrators so selected shall select the third arbitrator (who shall act as chairman of the arbitration proceedings), prior to the thirtieth (30^th) day following the appointment of the second Party-appointed arbitrator. If the Party-appointed arbitrators are unable to select a neutral arbitrator, they shall jointly submit a list of four names (two each) to the ICC, which shall select the third arbitrator from the list submitted to it.

     (b) No arbitrator shall be a past or present employee or agent of, or consultant or counsel to, a Party or any Affiliate of a Party, unless such restriction has been waived in writing by the other Party to the proceeding.

     (c) The substantive law governing the Dispute shall be the laws of the State of New York.

     (d) The arbitrators shall have the sole power and authority to determine the arbitrability of any Dispute arising under or relating to this Agreement or the subject matter hereof. Subject to any other relevant limitations set forth elsewhere herein, the arbitrators will have the power to award any type of relief that is just and appropriate in the arbitrators’ discretion, including compensatory damages, injunctive orders, orders for specific performances and declarations of rights.

     (e) The arbitrators shall not have power, however, to award punitive, consequential, exemplary or treble damages or any other type of relief in the nature of a penalty, and the Parties hereby expressly waive any right they might otherwise have to such relief. THE PARTIES HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY

19

WITH RESPECT TO ANY DISPUTE ARISING OUT OF OR RELATING TO THIS AGREEMENT.

Section 9.3 Finality; Enforcement. Any decision or award of a majority of an arbitral panel, as applicable, shall be final and binding upon the Parties. Each Party agrees that the arbitral award may be enforced against it or its assets wherever they may be found and that a judgment upon the arbitral award may be entered in any court having jurisdiction thereof. The Parties hereby waive any right to appeal or to review of the decision or the award of an arbitral panel by any court or tribunal and also waive any objections to the enforcement of such decision or award.

Section 9.4 Costs. The costs of arbitration shall be paid in accordance with the decision of the arbitral panel pursuant to the ICC Rules.

Section 9.5 Continuing Performance Obligations. The existence of any Dispute or the pendency of the Dispute resolution procedures set forth herein will not relieve or excuse a Party from its ongoing duties and obligations under this Agreement, and the Parties shall nevertheless proceed with the performance of this Agreement in accordance with the terms hereof.

ARTICLE 10 – TERMINATION

Section 10.1 Termination Rights. This Agreement may be terminated by either Party in the case of the failure of the other Party to fulfill any of its material obligations hereunder (a “Default”) on ninety (90) days’ prior written notice to the Party in Default, such notice to specify the performance failure of such Party.

Section 10.2 Cure Rights. Notwithstanding anything contained herein to the contrary, a Party that is in Default shall be entitled to cure such Default by satisfying its performance obligation prior to the end of such ninety (90) day period. Furthermore, if such Party is diligently proceeding to cure such Default but such cure cannot be accomplished within such ninety (90) day period, the Party in Default shall be given up to an additional sixty (60) days to cure the Default so long as such Party continues to diligently pursue curing the Default. If the Default is cured by the Party that is in Default prior to the end of the cure period, then the notice of termination shall be null and void. If a Party fails to cure a Default, then this Agreement shall terminate on the date set forth in the notice of Default, but in no event prior to ninety (90) days following the issuance of such notice of Default.

Section 10.3 Right to Retain the License. Notwithstanding anything contained herein to the contrary, if Licensor is in Default for a failure to perform any material obligation hereunder, Covanta shall retain all the license rights and other rights granted to Covanta hereunder, without any obligation to purchase any System through Licensor. In such case, Covanta shall place all Purchase Orders through AK.

20

Section 10.4 Termination by Licensor. If Licensor terminates this Agreement based on a failure of Covanta to fulfill any of its material obligations hereunder, Covanta shall not be relieved of the limitations and restrictions imposed by this Agreement upon the use or dissemination of the Technology and/or the Systems which is not at such time in the public domain; and that for installed Systems, Covanta shall retain all the license rights and other rights granted to Covanta hereunder.

ARTICLE 11 – GENERAL PROVISIONS

Section 11.1 Expenses. Except as is otherwise expressly provided in this Agreement, each Party will bear its respective expenses incurred in connection with the preparation, execution and performance of this Agreement.

Section 11.2 Confidentiality. The Parties agree to maintain the confidentiality of this Agreement and the terms and conditions hereof. Any public announcements or similar publicity with respect to this Agreement shall be issued at such time and in such manner as the parties shall jointly determine. Notwithstanding the foregoing, each Party (and its Affiliates) shall have the right to make all such disclosures as required by applicable law or by any governmental body, including any stock exchange or securities market to whose regulations or disclosure requirements a Party is subject, without the consent of the other Party hereto; provided, however, that in the event of any such required disclosure, the disclosing Party (and its Affiliates), to the extent reasonably practicable, shall provide the other Party with advance notice of any such disclosure and an opportunity to comment thereon. The parties acknowledge that it is their intent to limit, to the fullest extent possible, any publicity regarding their joint cooperation during the Interim Period, it being recognized, however, that Covanta will need to contact public officials in connection with securing permits or other approvals for the Demonstration Plant. In such regard, Covanta will undertake to obtain assurances of confidentiality from such public officials, but disclosures may nevertheless result.

Section 11.3 Notices. All notices, consents, waivers and other communications under this Agreement must be in writing and will be deemed to have been duly given when (i) delivered by hand (with written confirmation of receipt), (ii) sent by telecopier (with written confirmation of receipt), provided that a copy is mailed by registered mail, return receipt requested, or (iii) when received by the addressee, if sent by a nationally recognized overnight delivery service (receipt requested), in each case to the appropriate addresses and telecopier numbers set forth below (or to such other addresses and telecopier numbers as a party may designate by notice to the other parties):

Licensor:

AlphaKat - Global Energy GmbH
Schulstrasse 8

21

96155 Buttenheim, Germany
Attention: Chief Executive Officer
Facsimile: +49-9545-950325

Covanta:

Covanta Energy Corporation
c/o Covanta Holding Corporation
40 Lane Road
Fairfield, NJ 07004, USA
Attention: General Counsel
Facsimile: +1-973-882-7357

Section 11.4 Waiver. Neither the failure nor any delay by either Party in exercising any right, power or privilege under this Agreement shall operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power or privilege will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege. To the maximum extent permitted by applicable law, (i) no claim or right arising out of this Agreement can be discharged by one Party, in whole or in part, by a waiver or renunciation of the claim or right unless in a writing signed by the other Party, (ii) no waiver that may be given by a Party will be applicable except in the specific instance for which it is given and (iii) no notice to or demand on one Party will be deemed to be a waiver of any obligation of such Party or of the right of the Party giving such notice or demand to take further action without notice or demand as provided in this Agreement.

Section 11.5 Entire Agreement and Modification. This Agreement supersedes all prior agreements between the Parties with respect to its subject matter and constitutes a complete and exclusive statement of the terms of the agreement between the Parties with respect to its subject matter. This Agreement may not be amended except by a written agreement executed by the Party to be charged with the amendment.

Section 11.6 Assignment. Neither Party may assign its rights under this Agreement, in whole or in part, without the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed, except that each Party may make an assignment of this Agreement to an Affiliate (so long as such Party remains liable for its obligations hereunder following such assignment) and each Party may make a collateral assignment of its rights hereunder to one or more lender(s) in connection with the financing being arranged by such Party. In the case of a collateral assignment by one Party to one or more lenders, the other Party shall, if requested to so, negotiate the terms of a consent to assignment in good faith and enter into such consent without delay. Notwithstanding the

22

foregoing, a Party may withhold its consent in the case of a proposed assignment to any Person that is a Competitor of the Party whose consent is being sought.

Section 11.7 Severability. If any provision of this Agreement is held to be invalid, illegal or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of this Agreement held invalid, illegal or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid, illegal or unenforceable.

Section 11.8 Governing Law. This Agreement will be governed by, and construed in accordance with the laws of, the State of New York without regard to its conflicts of law (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law).

Section 11.9 No Power of Representation. Neither Party shall have the authority or right under this Agreement to, nor shall either Party hold itself out as having the authority or right under this Agreement to, (i) assume, create or undertake any obligation of any kind whatsoever, express or implied, on behalf of or in the name of the other Party without the express prior written consent of such other Party or (ii) accept service of any legal process addressed to or intended for such other Party.

Section 11.10 No Partnership. Nothing in this Agreement shall be construed as creating a partnership, association, joint venture or any other legal entity between the Parties (including their Affiliates), nor a fiduciary relationship between the Parties (including their Affiliates).

Section 11.11 No Third Party Beneficiaries. No provision of this Agreement is intended or is to be construed to confer upon any Person, other than the Parties and their respective Affiliates and successors and permitted assigns, any rights or remedies under or by reason of this Agreement, except for all Purchasers and Third Party Purchasers to the extent provided for in Section 2.6.

Section 11.12 Counterparts and Facsimile Signatures. This Agreement, and any other agreement, instrument, certificate of other documents desirable to be executed and delivered in order to consummate the Contemplated Transactions, may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. Any such document may be executed by facsimile signature. The signatures below of Covanta and Licensor also serve to state their agreement and position as parties to the “Acknowledgement and Agreement” which is being signed below by Dr. Christian Koch and AK.

[Signature page follows]

23

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

ALPHAKAT - GLOBAL ENERGY GMBH
By:	/s/ Yossi Raz
	Yossi Raz, Chief Executive Officer
	Date: February 6, 2008
COVANTA ENERGY CORPORATION
By:	/s/ Timothy J. Simpson
	Timothy J. Simpson, Executive Vice
	President and General Counsel
	Date: February 6, 2008

Acknowledgment and Agreement:

Dr. Christian Koch, in his capacity as President of AK and his individual capacity hereby, as signed below, acknowledges he has reviewed this License Agreement in its entirety, agrees to all of the terms hereof and confirms that the representations and warranties that are made in Section 8.2 are true and correct.

AK owns or has sufficient rights, and has granted Licensor sufficient rights, to allow Covanta to exercise the rights granted under the License Agreement. If for any reason the rights granted to Covanta by Licensor are not sufficient to allow Covanta to exercise its rights under the License Agreement, Dr. Christian Koch or AK shall convey or cause to be conveyed any and all further rights needed by AK or Licensor to permit Covanta to exercise such rights under the License Agreement. If the rights granted or to be granted to Licensor are terminated for any reason or if Licensor ceases to exist, AK shall enter into a substantially similar form of license agreement with Covanta, such new license agreement to preserve the Full Rights and/or the Qualified Rights granted to Covanta in Territory A and Territory B. Dr. Christian Koch agrees that he will cause AK to perform its obligations hereunder.

All capitalized terms herein have the meanings given in the License Agreement.

By:  /s/ Dr. Christian Koch
Dr. Christian Koch

24

Date: February 6, 2008

25

EXHIBIT 1 – RIGHTS AGREEMENTS

Terms of Agreement dated May 2, 2007
Shareholders’ Agreement dated July 10, 2007
Articles of Association of Licensee dated November 14, 2007 and November 22, 2007

26

May 2, 2007

Terms of agreement between:

Global Energy Inc (GE) public company on NASDAQ OTCBB,

With offices in Israel at

Migdal Aviv 35 floor

7 Abba Hillel St., Ramat Gan, Israel

And

ALPHAKAT GMBH (AK)

Schlstrasse 8

D-96155 Buttenheim, Germany

1.	ALPHAKAT GMBH (AK) Technology	AK and its principle Dr. Christian Koch developed owned and registered patents for technology to convert different types of Municipal solid Waste (MSW), organic materials, refinery sludge etc. into mineral diesel oil. The technology incorporates KDV plant and low temperature vacuum process including special patented catalyst and high speed turbine to distillate organics into diesel, all together the "technology" KDV500 has turbine of 2X200 KW, KDV5000 has turbine of 2X2000 KW
2.	AK demonstration plants	AK has built five plants to demonstrate its technology in the following countries: Mexico, Canada, Spain, Bulgaria and Italy. The plants KDV500 in Spain, Canada and Bulgaria are in a phase of final commission, GE has started due diligence and visited the KDV500 in Bulgaria, GE also discussed with the principals of the Canadian operation to learn more about the KDV500 in the state of Toronto town Berrie, Canada.
3.	GE and AK cooperation	Both companies GE and AK are looking to find a framework to cooperate in developing the technology, the potential market, and establish long term relationship to bring the technology to its utmost potential.
4.	GE contributions	GE can assist AK in the following fields:           a      Financial support.           b.    Assistance in corporate management, sales and after sales support. This will achieve by new joint marketing and                  Sales Company (M&S) as defined below.           c. Organizer of engineering and plant erection world wide.           d. Manage of Joint Ventures in many countries to produce diesel by utilizing the technology.
5.	AK contributions	AK and its principle Dr. Christian Koch can emphasize its valuable time for:

		a. Continues R&D for perfection of the technology.           b. Continues study to reduce the cost of the KDV units.           c. Leading the R&D program for KDV 5000.           d. Support the team of building and erection of plants.           e. Support field ideas from the Joint Ventures to maximize the technology.
6.	Phase one: Marketing and Sales Company	AK and GE will establish a marketing and sales world wide marketing company with equal partnership. The M&S will have exclusive right to sell the technology and plants worldwide. No other company will receive such exclusive rights. AK will continue to sell the technology and plants with other and smaller turbine up to 200 KW and 350 KW directly to any person in the world. It is AK's option to give old or new contact for new plant to the joint M&S Company to continue the sales negotiations. AK already gave exclusive rights for sales to: Italy, Spain, Portugal, Bulgaria, Mexico and Canada, and in Mexico and Spain for cooperation in mounting plants.            º The end user of M&S Company will pay the cost of the plant directly to AK the price includes agreed fee of 10% to the joint M&S Company.           º GE will finance all the M&S Company activity in the world.           º GE will deal with all permits required for erecting and selling the diesel in these countries.           º GE will manage the company and will appoint the personnel to achieve the goals of sales and after sales maintenance for these plants.           º GE will build a finance program to support the end user worldwide and allow them to pay the plant costs to AK.           º AK will support all technical aspects of the company and the customers.           º AK and GE will agree of the company strategy and its annual plans.           º AK has the right to vote against a specific decision of a deal.           º The Joint Company will be the only company with such rights.           º The Joint Company will have the exclusive

		right to sell any KDV turbine larger than and 350 KW.
7.	Order of 3 KDV 500	GE intends to order 3 KDV500 for Poland, USA and Israel. GE intends to start the permitting process for these 3 KDV500 plant. The price of one KDV500 will be 2.5 million Euros if GE will order one unit and 2.4 if GE will order all 3 units together. Payment terms:           º 100,000 Euros for permitting process for all 3 units, AK and Dr. Koch will support the permitting and EIA process,              if the process will require more hourly work then GE will pay additional hourly rate of 100 Euros for Dr. Koch,              80 Euros for senior engineer and 60 Euros for technician.           º Second payment of 1.2 million Euros for ordering of 6 turbines.           º Third payment for each plant of 50% - 400K already paid for the 2 turbines payment when building permit received.           º Fourth payment of 40% at delivery to site.           º Fifth payment of 10% after commission.
8.	Monthly payment	GE directly or through the Joint Company will pay to Dr. Koch a salary of 10,000 Euro per month.
9.	Initial Payment	The monthly payment will start subject to: First payment of 10,000 Euro will be only after complete technical "Due Diligence (DD)" which will include: (i) laboratory test of sealed sample of diesel from KDV 500 and (ii) visit continues operation of KDV plants.
10.	Phase two	AK and GE want to establish long term cooperation and allow the parties to know each other and achieve mutual trust in the technology and the people involved in the two companies. GE will have the option to invest directly in AK. For the money invested by GE in AK, GE will get shares of the Company as defined below.           a. GE will pay the actual cost of the KDV2000 and AK will keep open books for that purpose GE will also be involved in this process.           b. All the above said investment will consider as full price and payment for the first KDV5000 that GE will order.           c. The investment for order of KDV5000 will be done by 3 equal installments every 6 months starting at the end of the DD period.           d. For the payment of the KDV5000 GE will get

		10% shares of AK.           e. AK will show all the information to representative of GE, and GE representative will assist AK as much as possible.           f. The phase two is limited to start this year 2007 with the first prepayment for ordering the necessary parts and payments of the first part of 2 million Euros, when the payment is not released this year the agreement about phase two is cancelled. AK acknowledges that GE is a public company and has to report to the Stock Exchange Commissioner (SEC) according to the law and AK will report accordingly. This investment will subject to full DD that will include:           i. Patent and intellectual properties.           ii. Auditing company's balance sheets for the previous three years, including all bank loans and other obligations.           iii. Full discloser of KDV 500 production           iv. Full discloser of shareholding and shareholding agreements with companies in the countries mentioned in section 2 above.           v. Full discloser of employee and subcontract agreements.            vi. Discloser of all company's registration, article of association, legal aspects, past law sues, etc.           vii. Board resolution. viii. Any other discloser that GE may request to comply with its obligation to SEC.           ix. The money will invest in the company according to agreed milestones of the R&D program and the need of agreed working capital.           x. AK will arrange in proper manner all the company's intellectual property, process; know how, drawings and engineering data. This option for second DD period will be up to eight (8) months after the first payment of first phase.
11.	DD period	GE will finalize its first DD period 30 days after the visit to an operational KDV 500 plant.
12.	Final agreement	Upon mutual decision of both sides after the DD period GE and AK will work to draft a final agreement for development of KDV5000 GE in AK. The final agreement will include but not limited to: New Articles of Association, new Board of Directors, mechanism to achieve decisions, appointing of general

		manager CEO, appointing of CFO, dispute resolutions, etc.
13.	First refusal	AK agrees that if AK wants to sell part of AK shares to third party it will give right of first refusal to GE.
14.	Termination of terms of agreement	the This agreement is canceled automatically if one of the parties does not fulfill the obligations.

By:	/s/ Dr. Christian Koch	By:	/s/ Mr. Asi Shalgi
	Name: Christian Koch		Name: Asi Shalgi
	Title: CEO ALPHAKAT GMBH		Title: CEO Global Energy

July 10, 2007

SHAREHOLDERS’ AGREEMENT

THIS AGREEMENT is effective as of July 10, 2007 by and among GLOBAL ENERGY INC., a company incorporated under the laws of the State of Nevada (“GEYI”), and ALPHAKAT GMBH, a company incorporated under the laws of the State of Germany (“AK”), (each: a “Party” and together: the “Parties”).

WHEREAS, the Parties have incorporated a company in (to be defined later) under the name of Alphakat - Global Energy Inc (the “Company”), with GEYI to initially hold 50% of the shares and AK to initially hold the remaining 50% of the Shares; and

WHEREAS, the Parties desire to cooperate in order to promote the business of the Company in accordance with the provisions set forth herein.

NOW, THEREFORE, in consideration of the undertakings and the mutual covenants of the Parties hereinafter set forth, it is agreed as follows:

1.	SHAREHOLDING IN THE COMPANY
	Each of the parties shall subscribe for the shares of the Company, in consideration for the shares’ par value, and the Company shall issue 50% of the Company's shares to GEYI, and 50% of the Company’s shares to AK (each such amount of the shareholding shall hereinafter be referred to as the “Shares”).
2.	MAIN PURPOSE
	The Company’s purpose will be the worldwide marketing and sales of the Technology and the products (as these terms are defined bellow), or any such other activities as the Company may at any time determine, and to engage in any other lawful act or activity (the “Company’s Business”).
	For the purpose of this Agreement, the term "Technology" shall mean: the technology of KDV to convert waste containing hydrocarbons into mineral diesel oil. And the term "Products" shall mean any products ensuing or resulting from the Technology including KDV turbines.
3.	PLACE OF BUSINESS
	The Company’s principal place of business shall be (TBD), unless determined otherwise by the Company’s Board of Directors.
4.	TRANSFER RESTRICTIONS
	4.1	No Party shall sell, assign, transfer, pledge, hypothecate, mortgage or dispose of, by gift or otherwise, or in any way encumber (any of the above, "Transfer"), all or any part of the Shares owned by it (or securities convertible or exercisable therefore), other than in compliance with the terms of this Agreement or other than to a Permitted Transferee. For the purposes of this Agreement, "Permitted Transferee" shall mean an entity which is wholly owned or controlled by the Party. A transfer to a Permitted Transferee is only permitted if (i) each such transferee agrees in writing on a form prescribed by the Company

	to be bound by all of the provisions of this Agreement and (ii) any Transfer in interests in a Permitted Transferee shall be subject to all the transfer restrictions in this section and otherwise contained in this Agreement (section 5, 6 and 7) as if interests in such Permitted Transferee were shares in the Company.
4.2	In no event may either Party Transfer any of their Shares to any person, entity, business or venture that competes with the Company's Business.
4.3	Notwithstanding the foregoing, neither Party may Transfer any of its Shares during the first five (5) years following incorporation of the Company.

5.	RIGHT OF FIRST OFFER (THE "RIGHT")
	5.1	If at any time either Party (the "Offeror") wishes to Transfer any or all of the Shares owned by him/it to a third party (the "Offered Shares"), then prior to soliciting an offer from, or making any such offer to, a third party, the Offeror shall first submit a written offer containing all material terms to the other Party (the "Offer") in respect of the Offered Shares.
	5.2	Within sixty (60) days after receipt of the Offer, the other Party shall have the right to give notice to the Offeror of its intent to purchase all (but not less than all) of the Offered Shares on the same terms and conditions as set forth in the Offer. Once delivered, such notice, taken in conjunction with the Offer, shall be deemed to constitute a valid, legally binding and enforceable agreement for the sale and purchase of such Offered Shares to the other Party, and the sale of the Offered Shares to the other Party shall occur within sixty (60) days of receipt of the Offeror's written notice.
	5.3	Should written notice not be received by the Offeror within the sixty day time period referenced above, or if the other Party shall give notice of its election not to acquire such Offered Shares, then the Offer will be deemed to have lapsed, and the Offeror may, for a period of up to ninety (90) days thereafter, offer the Offered Shares to a bona fide third party on terms and conditions, including price, not more favorable to the proposed buyer than those contained in the Offer to the other Party.
	5.4	Any Shares not sold to a bona fide third party within the 90-day period referred to in Section 5.3 shall again be subject to the requirements of this Section 5.
	5.5	In the event that Shares are sold to pursuant to this Section 5, said Shares shall continue to subject to the restrictions imposed by Sections 4, 5, 6 and 7 of this Agreement, and the purchaser of said Shares shall agree in writing to abide by such Sections.
6.	TAG ALONG
	6.1	In the event that either Party (the "Initiating Party") wishes to Transfer any shares of the Company held by it to a third party, the Initiating Party shall notify the other Party in writing, and the other Party shall have the right to require, as a condition to such Transfer, that the proposed transferee purchase from him/it upon the same terms, that number of shares which constitutes the same portion of the total number of shares held by him/it as the number of shares proposed to be sold by the Initiating Party (the "Co- Sale Shares").

2

6.2	The other Shareholder shall have the option, exercisable by written notice to the Offereor, within thirty (30) days after receipt of the notice from the Offeror, to require participation in the sale as referenced in section 6.1 above.
6.3	In the event that the other Party exercises its tag along rights hereunder, the Initiating Party must cause the proposed transferee to add such shares to the shares to be purchased by the transferee, as part of the sale agreement to such a degree that all of the Co-Sale Shares are included.

7.	RESERVED
	8	ACKNOWLEDGMENT AND PRE-EMPETION RIGHTS
	8.1	The Parties acknowledge that their Shares may be diluted as a result of investments and other issuances of shares by the Company.
	8.2	If at any time prior to an IPO, the Company proposes to issue and sell New Securities, as defined below, the Parties agree that the Company shall enable the Parties to maintain their percentage ownership of the outstanding shares of the Company, as stated below:
	8.3	For the purpose of this Section 8, "New Securities" shall mean any capital stock of the Company, whether or not now authorized, and rights, options or warrants to purchase capital stock, and securities of any type whatsoever that are, or may become, convertible into capital stock; provided that the term "New Securities" shall not include (i) shares of the Company issuable upon exercise of outstanding options or warrants; (ii) securities issued pursuant to the acquisition of another corporation by the Company by merger, purchase of substantially all the assets of another corporation or any other reorganization; (iii) securities issued to employees, officers, directors and consultants of the Company pursuant to any stock option plan or stock purchases or stock bonus arrangement; (iv) securities issued pursuant to payment of any dividend or distribution with respect to all of the Company's issued and outstanding shares; and (v) securities issued to a strategic investor approved as such by the Board of Directors.
	8.4	If the Company proposes to issue New Securities, it shall give the Parties written notice (the "Rights Notice") of its intention, describing the New Securities, the price, the general terms upon which the Company proposes to issue them and the number of shares that each Party has the right to purchase under this Section 8. Each Party shall have fourteen (14) days from delivery of the Rights Notice to agree to purchase all or any part of its pro-rata share of such New Securities for the price and upon the general terms specified in the Rights Notice, by giving written notice to the Company setting forth the quantity of New Securities to be purchased. The Party's pro rata share shall be the ratio of the number of shares of the Company's Ordinary Shares then held by such Party of the date of the Rights Notice, to the sum of the total number of Ordinary Shares as of such date .
	8.5	If the Parties fail to accept such offer as to all or part of the New Securities, the Company shall have the right within one hundred and twenty (120) days thereafter to sell or enter into an agreement to sell, the New Securities as to which such offer, or offers, were not accepted; provided, however, that no such sale shall be effected at a price or upon terms more favorable to the purchasers thereof than those specified. In the event the Company has not sold or entered into an agreement to sell such New Securities within such 120-day period, the Company shall not thereafter issue or sell such New Securities without first complying with the procedure set forth in this Section 8.

3

9 TERMINATION OF RIGHTS

9.1 The rights contained in Sections 4, 5, 6, 7, 8 and 11 shall terminate and be of no further force or effect (i) immediately upon the consummation of the IPO or (ii) when the Company first becomes subject to the periodic reporting requirements of Section 12(g) or 15(d) of the U.S. Securities Exchange Act of 1934, as amended, or the reporting requirements of a similar reporting regime of another jurisdiction, whichever event occurs first.

10 BOARD OF DIRECTORS

10.1	So long as each Party owns 50% of the outstanding shares of the Company, then each Party shall be entitled to appoint an equal number of directors to the board of directors of the Company. In the event that either Party holds, at any time in the future, a majority of the number of outstanding Shares, then such Party will have the right to appoint a majority of the directors of the board of directors of the Company.
10.2	Initially, the directors appointed by GEYI shall be Mr. Asi Shalgi and Mr. Yossi Raz and the directors appointed by AK shall initially be Dr. Christian Koch and Mr. Ludwig Christian Koch.
10.3	Neither Party shall be able to assign or transfer its/his right to designate a director to any other third party.
10.4	Within 60 Days from the Effective Date of this Agreement, the board of directors shall agree on the Company's marketing and sales strategy, annual business plan, and goals.

11 MANAGEMENT OF THE COMPANY

11.1	GEYI shall appoint Mr. Yossi Raz as the Company's Chief Executive Officer ("CEO"') in accordance with the terms of an Employment Agreement attached hereto at Appendix A (the "Employment Agreement") between Mr. Yossi Raz and the Company as set out at Appendix A. Any subsequent CEO shall be appointed by GEYI.
11.2	AK shall initially appoint Dr. Christian Koch as the Company's Chairman. The Company's Chairman shall not have a casting vote. Any subsequent Chairman shall be appointed by AK.
11.3	AK shall have the right object to any sale of Product promoted or intended by the Company, in which case the Company shall not perform such sale and/or cease the promotion of such sale as applicable
11.4	The Company's CEO and Chairman shall be responsible for the day to day management of the Company, and the implementation of the Company's marketing and sales strategy and business plan, and for meeting the Company's goals.
11.5	Notwithstanding any action or resolution regarding any of the following issues, is to be approved by the Company’s board of directors:

4

.i any action that authorizes, creates or issues shares of any class.

.ii any action that reclassifies any outstanding shares into shares having preferences or priority as to dividends or assets senior to or on a parity with the Ordinary Shares; .

iii any merger or consolidation of the Company with or into one or more other corporations;

.iv the sale, lease, or other disposition of a material asset or the sale of all or substantially all of the Company’s assets;

.v any change in the rights relating to the composition or in the right to appoint members to the Board of Directors;

.vi any transactions between the Company and any Interested Party; an “Interested Party” shall mean a director, officer, employee, or significant shareholder or any family member of or consultant to any such person, corporation or other entity of which any such person beneficially owns ten percent (10%) or more of the equity interests or has ten percent (10%) or more of the voting power, other than transactions in the ordinary course of business.

.vii the terms and conditions of any initial public offering of the Company;

.viii the liquidation or dissolution of the Company;

.ix incur any indebtedness, make any capital expenditures, lend, enter into any material contract or commitment, incur any pledge or lien on the assets of the Company, other than as required in the ordinary course of business, but in no event in excess in the aggregate of US$ 5,000;

.x amendment of the Articles of Association of the Company; and

.xi the Company's signatory rights.

12 REMOVAL OF BOARD MEMBERS

12.1

Each Party agrees to vote in whatever manner as shall be necessary to ensure that (i) no director elected by either Party is removed from office, other than for cause, unless such removal is approved by the Party which so appointed that director and (ii) any vacancies created by the resignation, removal or death of a director shall be filled by the Party that appointed such director pursuant to the provisions of this agreement.

12.2

All Parties agree to execute any written consents required to effectuate the obligations of this Agreement.

13 EXPENSES AND FINANCING

13.1	The Parties agree that GEYI will lend to the Company such amounts as the Parties may agree, and in any event in accordance with a budget to be approved by the board of directors of the Company. The terms of such loan, including interest on such loan, will be agreed upon between the Parties.
13.2	All such payments as referenced in section 13.2 above shall be made for costs and expenses set forth in a budget approved by the board of directors of the Company from time to time.

5

14 EXCLUSIVITY

AK and the Company have the rights to market and distributor the Technology based on the KDV500, as define in the agreement dated May 2 2007.

14.1.1 AK herby appoints the Company as its sole agent exclusive for USA and China market, AK will not directly market to these markets but through the Company.

14.1.2 When GEYI will invest in the technology of Turbine 2000 than the Turbine 2000 technology will be marketing only through out the Company

14.1.3. The parties acknowledge that AK has already granted some third parties the right to sale the Technology and Products in certain territories as detailed in agreement signed May 2, 2007 ("Third Party Rights").

14.1.4 All sales transactions shall be made directly between AK and the purchaser. The sale price of any transaction shall include a fee of 10% which shall be paid by AK to the Company. The company has the right to offer higher prices as the market will accept in such case the Company will benefit from the full difference between the purchase price and the sale price. AK and the Company will coordinate prices.

15. DERTAKINGS OF THE PARTIES

15.1 AK shall provide all required technical assistance and support to the Company and any potential end users and purchasers of the Technology and the Products, in order to help the promotion of the Technology and the Products and the procurement of purchases.

15.2 GEYI will build a finance program to support end users in the procurement of the Products from AK, however, GA shall only offer such finance program to suitable end users at its sole and absolute discretion.

15.3 GEYI shall be responsible for obtaining necessary approvals and permits for the sale of diesel produced by the use ofthe Products and the Technology, were it finds it to be reasonable at its sole and absolute discretion.

16 REPRESENTATIONS AND WARRANTIES OF THE PARTIES

16.1	Each of the Parties hereby represents and warrants with respect to itself/himself the following:
	(i) Authority and Validity. Such Party has full power and authority to enter into, execute and deliver this Agreement and perform its/his obligations under this Agreement in accordance with its terms.

6

(ii) Absence of Conflicts. The execution and delivery of this Agreement by it and the consummation of the transactions as contemplated hereunder (i) do not and will not violate or conflict with any statute, regulation, judgment, order, writ, decree, or injunction currently applicable to it/him; and (ii) do not and will not violate or conflict with any existing mortgage, indenture, contract, licensing agreement, financing statement, or other agreement binding on it.

(iii) Consents and Contractual Restrictions. No consents or approvals of any third party are required in connection with the execution and delivery of this Agreement or the performance of the transactions contemplated hereunder otherwise. No agreement or arrangement binding upon such Party restricts its ability to fulfill its obligations and responsibilities under this Agreement or any related agreement or to carry out the activities contemplated herein.

(iv) Investment Representations. Each Party is acquiring the Shares for its/his or her own account.

16.2 AK further represents and warrants that:

(i) it has all valid legal rights to the Technology and the Products;

(ii) it has the right to grant to GEYI all rights contained in this Agreement, including the Exclusivity set forth in section 14 above; and

(iii) the provisions of this agreement and any of AK's undertakings hereunder does not infringe upon the intellectual property rights of any third parties.

Each Party undertakes to inform the other Party immediately upon any material change in the above representations and warranties.

17. ASSISTANCE TO THE COMPANY

The Parties shall use their best efforts to actively assist and promote the interests of the Company.

18. MISCELLANEOUS

18.1 ENTIRE AGREEMENT.

This Agreement represents the entire agreement between the Parties.

18.3 ASSIGNMENT.

No part of this agreement may be assigned by any of the Parties hereto without the consent of all of the Parties hereto.

18.4 GOVERNING LAW AND JURISDICTION.

This Agreement shall be governed by and construed under the laws of the Republic of Germany. The competent courts in Gerrmany, shall have exclusive jurisdiction over any

 7

dispute arising in connection with this Agreement.

18.5           HEADINGS.
Headings in this Agreement are for convenience only and shall not be used to interpret or construe its provisions.

18.6           NOTICES.
All notices or other documents under this Agreement shall be in writing and delivered personally or mailed, addressed to the Parties.

18.7           BINDING EFFECT.
The provisions of this agreement shall be binding upon and inure to the benefit of each of the Parties and their respective successors and assigns. The provisions of this Agreement shall supersede any conflicting provisions of the Articles of Associations of the Company with respect to the relationship between the Parties. The Parties agree to amend the Company's Articles of Association within the next thirty (30) days to the extent any terms of this Agreement so conflict or to the extent they otherwise deem it necessary to conform the Articles with the terms and condition set forth in this Agreement.

18.8           AMENDMENT.
This Agreement may be amended or modified only by written agreement between the Parties.

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

GLOBAL ENERGY INC.	ALPHAKAT GMBH
By:	By:
Name:	Name:
Title:	Title:

8

APPENDIX A

9

Record book number R1650 /2007 Re

Establishment of
Limited Liability Company

Today, the fourteenth and twenty-second day of November two thousand and seven,
- 14 and 22 November 2007 -,
the following appeared before me,
Martin Reiß,
Notary in Forchheim/Ofr., in the office at Nürnberger Street 8:

1)Dr. Christian Koch, born on July 04, 1940,
of 96155 Buttenheim, Schul Street 8,
acting herein as manager of

Alphakat GmbH
a company whose registered place of business is in Buttenheim
(business address: 96155 Buttenheim, Schul Street 8)

with the authority of single representation and exempted from the limitations of Section 181 of the Civil Code, regarding which, after perusal of the Electronic Trade Register at the Bamberg District Court made on November 14th 2007, I confirm that the above company is registered therein under HRB 5308 and Dr. Christian Koch is on record as manager with the authority of single representation and is exempted from the limitations of Section 181 of the Civil Code,

2.Mr. Joseph, known as Yossi, Raz, born on January 1, 1947, of 12 Nurit Str. , Haifa Isreal 34654 acting for

Global Energy Inc.

a company limited by shares incorporated under the laws of Nevada/USA, registered at the Secretary of State of Nevada, Corp Number C3690-1999, with office at 7 Zabotinski Str., Aviv-Tower, Floor 38, 52520 Ramat Gan, Israel,

subject to the consent of the aforesaid corporation which has to be certified by a notary public.

The parties identified themselves by official identity documents with pictures.

Mr. Yossi Raz, according to his own statement and the notary’s conviction, has insufficient knowledge of the German language, but knows sufficient English. At the time of certification the notary translated the document and the questions asked into English. All parties waived the services of an interpreter. As appendix 2 there is an English translation that has been made by the party and controlled by the notary. The annex also was made part of the notarial act. If there are differences between the German and the English text the German text shall prevale.

The reading of this deed was started on Nov. 14th, but interrupted as Mr. Raz had to leave, and resumed at the point, where it had been interrupted on Nov. 22nd and finished and signed by the parties on this day.

Upon the parties’ request I hereby certify the following:

I. Establishment

The parties mentioned in the introduction establish a Private Limited Company whose registered place of business is in Buttenheim (business address: 96155 Buttenheim, Schul Street 8) under the name

Alphakat - Global Energy GmbH

The Articles of Association are set down in the Annex to this document. Refer-ence is made to the Annex. The shareholders are taking over the shares as provided in the Articles of Association.

II. Costs, Copies

2

The costs of application and registration in the Commercial Register will be borne by the company as well as the costs of this certification in accordance with the Articles of Association.

The shareholders, the company, the tax office and the Registry Court of jurisdiction will each be given notarized copies.

III. Power of Attorney

Each of the Notary’s employees and every party of the contract will be exempted from the legal limitations and will be given power of attorney, including legal successors, to complete or amend this document in order to correct objections made by the Registry Court.

The notary shall get and receive for the parties of the contract the notarized consent of the party not represented today.

References

The Notary has pointed out inter alia:

- that only after registration in the Commercial Register will the company be established and that, according to Section 11, 2 of the Limited Liability Companies Law, before the company is registered the person performing legal acts on behalf of the company will be personally liable.

-that all shareholders and directors are in principle responsible for the authenticity of the data stated when establishing the company;

-that at the time of registration of the company in the Trade Register, the value of the company’s assets may not be less than that of the share capital, and that every shareholder has the obligation to pay any difference, without any limitation, compared with the pledged investment, and that the Registry Court has the right to refuse registration of the company in the Trade Registry on the grounds of unpaid prior charges.

3

V. Shareholder Resolution

Waiving any formal and time regulations, a shareholder meeting is called and the following resolution adopted:

The first business manager appointed is Dr. Christian Koch. He always has the authority of single representation and is exempted from the limitations of Section 181 of the Civil Code (prohibition of acting as contracting party and of multiple representations).

Mr. Yossi Raz will be granted single signature (Prokura), as well as being exempted from the limitations of Section 181 of the Civil Code.

VI. Guarantees

Each of the parties guarantees, insofar as they are concerned,

-that the signing parties have full power and authority of representation, of signing this agreement, executing and performing it and fulfilling the obligations based hereon;

- that signature and execution of the agreement is not contrary to any obligations stipulated in the Articles of Association, the law, agreements or otherwise;

-that no consent whatsoever by any third party is required for the execution or signature of this agreement, and

-that each party is acting on its own account.

Alphakat GmbH, Buttenheim, moreover guarantees:

-that it is legally entitled to KDV Technology and the corresponding products;

4

-that it is entitled to grant the newly established enterprise all the rights agreed upon herein, including the exclusive marketing right according to the Articles of Association;

- that the stipulations agreed upon herein and execution thereof do not infringe upon the protected copyrights of any third party.

Should any practical change occur regarding the above guarantees, each party has the obligation to inform the other accordingly, without delay.

Together with the Annexes 1 and 2 read by the notary,
approved by the parties and signed

(this is still part of annex 2, the English translation):

5

Annex 1
to the document certified by Notary Reiss in Forchheim
dated November 14th and 22nd, 2007, Document no. R1650 /2007

Articles of Association

Article 1: Company’s Name and Registered Place of Business

1.            The company’s name is

Alphakat - Global Energy GmbH.

2.           The company’s registered place of business is Buttenheim, district of Bamberg.

Article 2: Purpose of the Enterprise

1.	The purpose of the company is the worldwide marketing and distribution of KDV Technology (un-pressurized catalytic lubrication) for transforming recycling and waste material containing hydrocarbons into diesel fuels, as well as of products connected to this technology, including KDV tur-bines.
2.	The company is entitled to perform any transaction which may directly or indirectly benefit the company’s purpose, in particular - acquiring other enterprises, being a partner therein or assuming their representation and management. The company is entitled to establish branches.

Article 3: Share Capital

1.	The company’s share capital amounts to € 25,000.
2.	The share capital is divided as follows:

Shareholder	Amount of Authorized Capital
Alphakat GmbH, Buttenheim	€ 12,500
Global Energy Inc., New York/Ramat Gan	€ 12,500

6

3.

The capital invested must be paid in cash and becomes fully payable immediately.

4.

No stipulations are agreed upon in the Articles of Association regarding capital increase or later contributions. Such measures can only be decided by amending the Articles of Association. Any measure that may modify the participation quotas by modifying the authorized capital, i.e. capital increases, conditional capital increase or the issue of convertible debentures and similar financial instruments may only be decided by a unanimous resolution of all shareholders present.

Article 4: Duration, Business Year

1.	The agreement is concluded for an undetermined period of time.
2.	The business year is the calendar year. The first business year begins upon registration in the Commercial Register and ends at the end of the calendar year in which the registration is made.
3.	Under the contracts law any transactions made from the time the company was established are considered to be made on account of the company.

Article 5: The Company’s Executive Organs

The company’s executive organs are the management (manager) and the shareholder meeting.

Article 6: Representation

1.	As long as the company has only one manager, he has the right to sole representation.
2.	If several managers are appointed, the company will be represented by two managers jointly or by one manager jointly with an authorized signatory (“Prokurist").

7

3.	By a resolution of the shareholders, the managers or one of them can be granted sole representation rights and/or exemption from the limitations of Section 181 of the Civil Code.
4.	The above stipulations apply also to the liquidators of the company.
5.	As long as both partners own each one half of the company, the partners, Alphakat GmbH, Buttenheim, and Global Energy Inc. have the right to appoint one manager or signatory each with the sole outside representation right on behalf of the company. The partner can freely decide whether to appoint a manager or a signatory (Prokurist). The other partner has the obligation to agree to the appointment insofar as there are no important reasons against the appointment of the intended person. Cancellation of such appointment against the wish of the partner entitled to decide is only possible on serious grounds. Upon conclusion of the manager/signatory’s legal office, the entitled partner may require the appointment of a new manager or signatory to be named by him.

Article 7: Business Management

1.	The managers must manage the company’s business carefully and conscientiously according to the stipulations of the law and the partnership agreement. They must respect instructions given as per the partners’ resolutions.
2.	Any measures beyond the regular business operation of the enterprise may only be performed by one of the managers based on a partners’ resolution. A partners’ resolution can set forth the measures requiring consent in detail.
3.	Subject to an extraordinary partners’ resolution and subject to stricter legal regulations, the following business management measures always require the consent of both partners:
	1.	Sale, letting, leasing or other transfer of all or a substantial part of the company’s assets;
	2.	Agreements of any kind between the company, its executive organs, its partners, persons closely connected to the executive organs or to the partners, or anyone else with at least 10% participation in the above mentioned entities.
	3.	Establishing and closing branches;
	4.	Liquidation of the company;

8

5.	Conclusion of a transaction of any kind outside the company’s normal business operations, at a value of more than € 5,000 per transaction.
6.	Establishment of signature power or general power of attorney
7.	Establishment of connections with corporations, conclusion of secret partnership agreements, of management agreements and other agreements which may give third parties the power to manage the company.

Article 8: Partners’ Assembly (Shareholder Meeting)

1.	Partners’ resolutions are adopted at partners’ assemblies if not otherwise stipulated by law or these Articles of Association.
2.	The partners’ assembly is convened by the managers, each manager being separately authorized to convene the assembly. Notice is given by registered letter giving the place, time and agenda, and mailed to the last address of the partner provided to the company. The time allowed for the notice, if there is no particular need for haste, is at least two weeks after mailing, not including the day of the assembly.
3.	The partners’ assembly constitutes a quorum if at least 70% (seventy percent) of the authorized share capital is represented. Otherwise, an additional assembly must be convened without delay respecting the time al-lowed for notice as per paragraph 2, which assembly will constitute a quorum regardless of the number of participants. This must be stipulated in the second notice.
4.	Partners’ resolutions, if not otherwise stipulated by law or the Articles of Association, will be adopted by a simple majority of votes. Abstention from voting will be considered a negative answer. Every € 50 of a business share grants one vote.
5.	Insofar as no other partners’ resolution was adopted, the partners’ assembly will take place at the company’s registered place of business. At the assembly the representation by executive organs or executive employees of the partners, the other partners or people obliged to maintain professional secrecy is permissible.
6.	The assembly will elect a chairman by a simple majority. The chairman will also take care that the resolutions are recorded in writing. Within a period of four weeks after the assembly he will send the partners a protocol of the assembly.

9

7.

The partners may deviate from the provisions regarding the partners’ assembly and its formalities if it is agreed by all partners. With the consent of all involved, resolutions can also be adopted by circular resolution, by phone, fax or electronically. In this case care must be taken that the text of the resolution be immediately documented in writing. If all partners take part in a deviating form of resolution, their consent is assumed if they do not immediately protest against this form of resolution.

8.

Except in cases of nullity, in particular when obligatory laws are broken - the partners may only protest against the resolution by submitting a claim in court within a period of two months from the date the resolution was adopted.

Article 9: Balance Sheet, Appropriation of Earnings

1.	Within three months after the end of the business year, the managers must prepare a balance sheet with a Profit and Loss Account for the previous year, while respecting legal provisions, and submit it to the partners’ assembly with the proposed appropriation of earnings. Insofar as legally permissible the period for this will be six months.
2.	The appropriation of earnings is subject to legal provisions. This means that in principle the partners’ assembly will decide about the appropriation and distribution of the earnings by resolution (Section 29 of the Limited Liability Companies Law in the version of the Balance Sheet Directives Law).
3.	Global Energy Inc. can demand that every quarter balance sheets are filed as required by the American SEC regulation to be filed with the Global Energy Inc. obligation for 10-Q.

Article 10: Disposal of Partnership Shares

1.	The disposal of a partnership share or parts thereof requires written permission by the company to be valid, which shall only be given by the management after all partners have given their consent.
2.	The above regulations apply also to the establishment of a beneficial interest in respect to the partnership shares as well as to pledging and assignment for security of partnership shares.

10

3. Every partner is obliged, if intending to sell, to inform the other partner in good time before beginning negotiations with third parties, and to accordingly submit a sales offer. He must leave the other partner a reflection time of at least one month. In case of sale, the other partner has the right of first refusal.

Article 11: Termination

1.	Each partner may terminate the partnership in the company by a notice of six months before the end of the business year, but not before December 31, 2010.
2.	In consequence of the termination - subject to the provisions of Paragraph 3 - the terminating partner shall leave the company after the end of the notice period and the company shall continue according to Articles 12 and 13.
3.	If the other partners join the termination by a partners’ resolution, the company will be in liquidation at the date of termination. The terminating party will take part in the liquidation.

Article 12: Confiscation of Partnership Share, Retirement

1.	The confiscation of business shares is permissible. It does not require the consent of the involved partner if:
	a)	insolvency proceedings are opened concerning his assets, or the opening is refused for lack of assets, or
	b)	his business share is taken in execution (by a third party);
	c)	there is significant cause. A significant cause is in particular when, due to the misconduct of a partner, the other partners cannot be required to continue their business relationship with him. No fault is necessary for this.
2.	Instead of confiscating the partnership share, the partners’ assembly may decide to transfer the business share to one or several partners or to a third party named by the partners’ assembly. In the partners’ resolution each co-partner may require that in the case of assignation, the share of the retiring partner shall be transferred in proportion to his share in the company (accrual). Should an exact proportional division not be possible, the shares shall be divided as closely as possible.
3.	If there is a right to confiscate, such confiscation or a partners’ resolution according to Paragraph 2 can only occur within six months from of the time the cause becomes

11

	known, but only as long as the cause for confiscation still exists. This includes the knowledge by one of the managers (regardless of the type of representation authority) of the company, insofar as the cause is not linked to the very person of this manager.
4.	The resolution concerning confiscation or retirement is adopted by the partnership assembly at which the partner to be dismissed has no right to vote.
5.	Confiscation or retirement are subject to remuneration. The remuneration will be payable by the buyer of the share, observing Section 30 of the Limited Liability Companies Law (forbidding that the share capital is being paid back by the company to the partner). The amount of remuneration will be determined according to the regulations et forth below.

Article 13: Remuneration for confiscated or assigned shares

1.	If business shares are confiscated or assigned in accordance with these Articles of Association, the entitled partner or his successors will be remunerated for it. For this purpose the management will immediately prepare a compensation balance sheet. In this balance sheet all assets and liabilities shall appear at their real value at the time of the partner’s retirement. The company’s goodwill - if permissible - is not to be taken into account. The retired partner will not participate in pending transactions.
2.	If the parties involved cannot reach an agreement as to the value, it will be determined by an expert. The expert will be appointed upon demand of one of the parties by the President of the Bayreuth Chamber of Industry and Commerce. The costs of the valuation will be borne by the retired party and the company in equal shares.
3.	The remuneration will be paid in five equal annual installments. The first installment is due for payment six months after the confiscation resolution or the date of retirement of the partner involved, and the following installments on the corresponding calendar day of the subsequent years. The outstanding installment will bear annual interest of 2% - two percent - over the basic interest rate as described in the Euro Introduction Law commencing with the confiscation resolution or the date of retirement. The interest will be calculated at current account bank rates and shall be due for payment together with the following installment.

12

4. The compensation can be pre-paid fully or partially, and partial pre-paid amounts will be deducted from the following installment due. No security may be demanded.

Article 14: Exclusivity/Prohibition of Competition

Alphakat GmbH, Buttenheim gives the right to sell world wide. No other company or person can get the same rights for the world-wide distribution.

Alphakat GmbH appoints the company to be the sole marketing agent for the United States of America and the Chinese market. Alphakat GmbH will not use any marketing channels on those markets except already established contacts.

The parties involved acknowledge that Alphakat GmbH, Buttenheim has already granted third parties the right to sell the Technology and products in various areas, as described in detail in the agreement dated May 02, 2007. Alphakat GmbH explicitly reserves the right, as long as those agreements are valid and in their material extent, to execute and fulfill those agreements with third parties on its own account. No compensation in that respect has been agreed upon.

The foregoing exclusive dealing requirements are valid as long the contract from May 2nd 2007 is valid (including amendments or following contracts).

By a partners’ resolution to which both partners must consent, the partners and managers may also regulate whether there are further prohibitions of competition, whether to give exemptions and whether the exemption occurs against remuneration or without remuneration.

Should one of the partners - for whatever reason - retire from the company, he has the obligation not to exploit business secrets of which he learned pursuant to the execution of this partnership agreement, either himself or by transfer to third parties at the expense of the company founded or on the account of the other partner.

Article 15: Additional Contributions to the Company

13

1.	All sales and similar transactions will be made directly between Alphakat GmbH, Buttenheim and the business partner. The sales price of each such transaction will include a 10% commission (not including Value Added Taxes as per law), which will be paid by Alphakat GmbH directly to the newly founded company. The company has the right to make higher price offers, as long as the market accepts them. In such case, the company would profit fully from the difference between the purchase price offered by it and the regular sales prices. Alphakat GmbH and the company will mutually coordinate their prices.
2.	Alphakat GmbH will grant all necessary technical assistance and support by the company to any end user and buyer of the Technology and products in order to support the marketing of the technology and the products during sales.
3.	Global Energy Inc. will establish a financial program in order to support the end user in the acquisition of Alphakat GmbH products. However Global Energy Inc. reserves the right to put such financial support only at the disposal of selected and adequate end users. Moreover Global Energy Inc. has the responsibility of providing the permits and tests necessary for the sale of the diesel oil produced by the use of the marketed products and technology. Global Energy Inc. is free to decide where they should do the marketing (i.e. also obtaining permits).

Article 17: Publications

The company’s publications will be made only in the Electronic Federal Journal (elektronischer Bundesanzeiger).

Article 18: Tax Clause

The executive organs of the company must respect the trading and tax law principles of orderly business management and shall maintain the care in business transactions that would be taken by an orderly and conscientious businessman.

The management shall in particular not be authorized to grant advantages to the partners or persons and companies close to them beyond the profit distribution resolution duly adopted, neither to violate the prohibition of additional or retroactive payments, nor to breach other acknowledged tax law principles which, when

14

disregarded, cause covert profit distribution. In case of non compliance, the amount of the imbalance shall be covered by the partner to whom the advantage was credited and the usual bank interests paid from the time the advantage was granted until the payment is settled. Transactions in breach of the above stipulations are void ab initio.

Insofar as the tax administration or tax courts recognize the payment received as income received by the partner concerned despite the above tax clause, without considering the repayment as negative income, the partner will only have to repay the advantage remaining after deducting the additional income tax payable by him plus the usual bank interest.

Article 19: General Instructions

1.

Insofar as not otherwise stipulated in this agreement, the German Law regarding Private Limited Companies (GmbH) shall prevail. The agreement is formulated according to the provisions of German Company Law and is subject to the jurisdiction of German courts.

2.

Should any of the provisions of this agreement be or become invalid or unenforceable, the other parts of the agreement shall remain valid nevertheless and shall be binding on the parties to the agreement. The partners undertake in such case to immediately and retroactively change the interpretation, whether completely or by replacing any invalid provision retroactively, so that it becomes as close as possible to the intended purpose.

Article 20: Cost

The costs of notarizing the partnership agreement, the publication, the application for registration and registration of the Company in the Trade Registry as well as the costs of consultancy services in respect of the establishment shall be borne by the Company up to an estimated amount of € 2,000; any establishment costs above that amount shall be borne by the partners. This applies without prejudice to the legal personal liability of the parties.

-End of Annex 2-

15

EXHIBIT 2 – PATENTS

Document Number	Title	Country	Registration Date	Docket Number	File / Reference Number
ALP6004WO	High-power	WO	04/04/07	PCT/DE2007/0	PCT/DE2007/0
ALP7001BR	Diesel Oil out of	BR (Britain)	03/31/04	PIO400912-6	PIO400912-6
ALP7001CA	Diesel Oil out of …	CA (Canada)	07/15/04	2,474,523	2,474,523
ALP7001CN	Diesel Oil out of …	CN (China)	03/23/04	200410030270	200410030270
ALP7001IN	Diesel Oil out of …	IN (India)	08/02/04	747/CHE/2004	747/CHE/2004
ALP7001JP	Diesel Oil out of …	JP (Japan)	10/08/04	2004-295764	2004-295764
ALP7001MX	Diesel Oil out of …	MX (Mexico)	03/15/04	PA/A/2004/002	PA/A/2004/002
ALP7001RU	Diesel Oil out of …	RU (Russia)	03/30/04	2004109567	2004109567
ALP7001US	Diesel Oil out of …	US (US)	07/15/04	10/891971	10/891971
ALP7002BR	High-power	BR (Britain)	02/02/06	PIO601891-2	PIO601891-2
ALP7002CA	High-power	CA (Canada)	09/01/06	2558401	2558401
ALP7002CN	High-power	CN (China)	02/14/06	200610004445	200610004445
ALP7002IN	High-power	IN (India)	07/25/06	1290/CHE/200	1290/CHE/200
ALP7002JP	High-power	JP (Japan)	04/27/06	2006-123066	2006-123066
ALP7002MX	High-power	MX (Mexico)	04/07/06	PA/a/2006/003	PA/a/2006/003
ALP7002RU	High-power	RU (Russia)	04/19/06	2006113270	2006113270
ALP7002US	High-power	US (US)	08/23/06	11/2508760	11/2508760
ALP7004BR		BR (Britain)	04/10/07
ALP7004CN	High-power	CN (China)
ALP7004IN	High-power	IN (India)	11/20/07
ALP7004JP	High-power	JP (Japan)	11/19/07	2007-299152	2007-299152
ALP7004KR	High-power	KR (Korea)	11/20/07	10-2007-01186	10-2007-01186
ALP7004MX	High-power	MX (Mexico)	05/25/07	MX/a/2007/006	MX/a/2007/006
ALP7004RU	High-power	RU (Russia)	11/19/07

27

EX-10.26

Exhibit 10.26

BUSINESS AND DEVELOPMENT AGREEMENT

     This Business and Development Agreement (this “Agreement”) is made and entered into as of the 6^th day of February, 2008, by and between Global Energy, Inc., a corporation organized and existing under the laws of the State of Nevada (“Global”), and Renewable Diesel, LLC, a limited liability company organized and existing under the laws of the State of Delaware (“Renewable”).

     WHEREAS, AlphaKat GmbH, a company organized and existing under the laws of Germany (“AK”), owns or has certain rights to a proprietary technology developed by Dr. Christian Koch to convert waste material which contains hydrocarbons into diesel (as further defined below, the “Technology”);

     WHEREAS, AK and Global formed AlphaKat - Global Energy GmbH, a company organized and existing under the laws of Germany (“Licensor”), to market the Technology in accordance with the agreements entered into by AK and Global;

     WHEREAS, Global and Trianon Partners, a corporation organized and existing under the laws of the State of Nevada (“Trianon”) and an affiliate of Renewable, entered into a Joint Development Agreement dated October 24, 2007 (the “JDA”) which contemplated, among other things, (i) the execution of a license agreement between Licensor and Trianon, (ii) the joint development of projects using the Technology by Global and Trianon or a new entity formed by the owners of Trianon and (iii) Trianon assisting Global to install a plant in the United States, at Global’s sole expense, to demonstrate the commercial viability of the Technology;

     WHEREAS, Trianon, following the execution of the JDA, introduced Global to Covanta Energy Corporation, a corporation organized and existing under the laws of Delaware (“Covanta”), which is in the waste-to-energy business;

     WHEREAS, Trianon, at the request of Global, worked with Global and Licensor to structure a business relationship with Covanta, including the negotiation and execution of (i) the License Agreement between Licensor and Global of even date herewith and (ii) the Business and Royalty Agreement between Global and Covanta of even date herewith;

     WHERAS, American Renewable Diesel, LLC, a limited liability company organized and existing under the laws of the State of Delaware (“American”) and an affiliate of Trianon and Renewable, is entering into a License Agreement of even date herewith with Licensor;

     WHEREAS, Global and Trianon have agreed to terminate the JDA and to put in place a modified set of agreements between Global and Renewable; and

     WHEREAS, Global and Renewable want to set forth their agreements;

     NOW, THEREFORE, in light of the mutual premises set forth herein and other good and valuable consideration, the receipt and the sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows.

ARTICLE 1 – DEFINITIONS AND INTERPRETATION

Section 1.1 Capitalized Terms. Unless otherwise specified herein, the following capitalized terms shall have the following meanings:

     “Affiliate” means, in relation to any Person, any other Person that controls, is controlled by, or is in common control with, such Person. For the purpose of this definition, control means the direct or indirect control of fifty percent (50%) or more of the voting rights in such Person or the power to direct the management or policies of such Person, whether by operation of law, by contract or otherwise. Except as shall otherwise be expressly provided in this Agreement, and for the avoidance of any doubt, as of the Effective Date, (i) Renewable, Trianon and American are Affiliates, (ii) Licensor and AK are Affiliates and (iii) Licensor and Global are Affiliates, but AK and Global are not Affiliates.

     “Agreement” has the meaning set forth in the first paragraph hereof.

     “AK” means AlphaKat GmbH, a company organized and existing under the laws of Germany, and its successors and assigns.

     “American” means American Renewable Diesel, LLC, a limited liability company organized and existing under the laws of the State of Delaware, and its successors and assigns.

     “Business and Royalty Agreement” means the Business and Royalty Agreement of even date herewith entered into by Global and Covanta.

     “Consulting Agreement” means the Consulting Agreement entered into by Global and Trianon dated October 20, 2007.

     “Covanta” means Covanta Energy Corporation, a corporation organized and existing under the laws of the State of Delaware, and its successors and assigns.

     “Covanta License Agreement” means the License Agreement entered into by Licensor and Covanta of even date herewith, a copy of which has been provided to the Parties by Licensor.

     “Default” has the meaning set forth in Section 5.1.

Execution Copy 2

     “Dispute” has the meaning set forth in Section 7.1.

     “Effective Date” has the meaning set forth in Section 4.1.

     “Feedstock” has the meaning set forth in the License Agreement.

     “Finding Party” has the meaning set forth in Section 2.1(a) .

     “Global” means Global Energy, Inc., a corporation organized and existing under the laws of the State of Nevada, and its successors and permitted assigns.

     “Global Percentage” has the meaning set forth in Section 2.1(d) .

     “ICC” means the International Chamber of Commerce.

     “ICC Rules” has the meaning set forth in Section 7.1(c) .

     “Improvements” means all the techniques, enhancements, modifications, changes, experience, methods, information, data or knowledge that will be created or acquired in the future relating to the Technology and/or the manufacturing of such components for Systems (whether or not patentable, useful or workable) through the implementation, development, testing and improvement of the Technology.

     “Initial Period” has the meaning set forth in the License Agreement.

     “Interim Period” has the meaning set forth in the License Agreement.

     “Investment Agreement” means the Business and Investment Agreement to be entered into by Covanta and Renewable.

     “KDV 500” means the system of components, including all of the structural steel, piping, pumps, vessels, control systems, wiring, two proprietary “mixing turbine pumps” and the operations, maintenance and start-up manuals provided by AK, to convert hydrocarbon feedstock, including any Feedstock, into diesel oil using the Technology which is capable of producing a minimum of 500 liters of diesel oil per hour.

     “License Agreement” means the License Agreement entered into by American and Licensor of even date herewith, a copy of which has been provided to the Parties by Licensor.

     “Licensor” means AlphaKat - - Global Energy GmbH, a company organized and existing under the laws of Germany, and includes its successors and assigns.

     “LLCA” has the meaning set forth in Section 2.2(g) .

     “Other Party” has the meaning set forth in Section 2.1(a) .

Execution Copy 3

     “Parties” means Global and Renewable.

     “Party” means Global or Renewable, as the case may be.

     “Person” means any natural person, corporation, company, partnership, business trust, governmental authority or other entity.

     “Project” means a project to convert a feedstock to diesel using the Technology.

     “Project Company” has the meaning set forth in Section 2.2(g) .

     “Project Development Costs” has the meaning set forth in Section 2.2(c) .

     “Purchase Order” has the meaning set forth in the License Agreement.

     “Renewable” means Renewable Diesel, LLC, a limited liability company organized and existing under the laws of the State of Delaware, and its successors and permitted assigns.

     “Renewable Percentage” has the meaning set forth in Section 2.1(d) .

     “Subject Project” has the meaning set forth in Section 2.1(a) .

     “System” means any system of components, whether it is in existence today or developed hereafter, including all of the structural steel, piping, pumps, vessels, control systems, wiring, the proprietary “mixing turbine pump(s),” any new components of any future system of components and all of the operations, maintenance and start-up manuals provided by AK, to convert hydrocarbon feedstock, including any Feedstock, into diesel oil using the Technology, including, for the avoidance of doubt, the KDV 500.

     “Technology” has the meaning set forth in the License Agreement.

     “Territory” has the meaning set forth in Section 2.1.

     “Trianon” means Trianon Partners, a corporation organized and existing under the laws of the State of Nevada, and its successors and assigns.

Section 1.2 Interpretation. In this Agreement, unless otherwise indicated or required by the context:

     (a) Reference to and the definition of any document (including this Agreement) or any applicable law shall be deemed a reference to such document or applicable law as it may be amended, supplemented, revised or modified from time to time;

Execution Copy 4

     (b) All references to an “Article,” “Section” or “Exhibit” are to an Article or Section hereof or to an Exhibit attached hereto;

     (c) Article and Section headings and other captions are for the purpose of reference only and do not limit or affect the meaning of the terms and provisions hereof;

     (d) Defined terms in the singular include the plural and vice versa, and the masculine, feminine and neuter gender include all genders;

     (e) The words “hereof,” “herein” and “hereunder” and words of similar import refer to this Agreement as a whole and not to any particular provision of this Agreement; and

     (f) The words “include,” “includes” and “including” mean include, includes, and including “without limitation” and “without limitation by specification.”

ARTICLE 2 – RELATIONSHIP AND RIGHTS OF THE PARTIES

Section 2.1 Rights of the Parties. Each Party shall have the right during the Interim Period, the Initial Period and the Extended Period, directly or through its Affiliates, to identify and develop Projects in the Territory, subject to the terms and conditions of this Agreement. As of the Effective Date, the territory (the “Territory”) shall be the states of California, New York and Texas. If American meets the two (2) requirements set forth in the first sentence of Section 2.1(b) of the License Agreement, the Territory shall be the states of California, New York, Texas, New Jersey and Florida, it being agreed that Global shall be entitled to develop Projects for its own account in Florida and New Jersey prior to the date by which Renewable must satisfy the requirement set forth in clause (ii) of the first sentence of Section 2.1(b) of the License Agreement, but Global shall not give any other Person the right to develop Projects in such states prior to such date. The Parties further agree as follows:

     (a) The Party that identifies a Project for development in the Territory shall be referred to herein as the “Finding Party” and the other Party shall be referred to herein as the “Other Party.” The Project identified for development shall be referred to herein as the “Subject Project.”

     (b) If Global is the Finding Party, it shall be required to notify Renewable about the Subject Project and Renewable shall have the right to invest up to twenty-five percent (25%) of the total equity required for the Subject Project or such higher amount as may be offered by Global in its sole discretion (but not less than five percent (5%) of the total required equity), all as further provided for in Section 2.2. If Renewable elects not to invest any equity in the Subject Project, then Global shall be free to proceed with the Subject Project without the further involvement of Renewable. For the avoidance of any doubt, Covanta shall not have the right to invest in any Subject Project identified by

Execution Copy 5

Global unless Global or Renewable makes an offer to allocate a portion of its equity investment rights to Covanta in their sole discretion.

     (c) If Renewable is the Finding Party, it shall be required to notify Global about the Subject Project and Global shall have the right to invest up to fifty-one percent (51%) of the total equity required for the Subject Project (but not less than ten percent (10%) of the total required equity) and Covanta shall have the right to invest up to twenty-four percent (24%) of the total equity required for the Subject Project (but not less than ten percent (10%) of the total required equity), all as further provided for in Section 2.2. If Global elects not to invest any equity in the Subject Project, then Renewable shall be free to proceed with the Subject Project without the further involvement of Global.

     (d) The equity percentage to be provided by Global for a Subject Project shall be referred to herein as the “Global Percentage.” The equity percentage to be provided by Renewable for a Subject Project shall be referred to herein as the “Renewable Percentage.”

     (e) Each Subject Project identified by Renewable shall be developed by Renewable. Each Subject Project identified by Global in which Renewable agrees to invest a portion of the required equity shall by developed by Renewable. Each Subject Project identified by Global in which Renewable decides not to invest equity shall be developed by Global unless the Parties agree otherwise at the time.

     (f) Notwithstanding anything that is contained herein to the contrary, if either Party identifies a Carve-Out Project (as such term is defined in the Business and Royalty Agreement) for development in the Territory, Covanta shall be offered the right to invest one third (1/3) of the total required equity in the Carve-Out Project and the Parties shall each be entitled to invest one third (1/3) of the total equity required for the Project.

Section 2.2 Project Investment Rights of Other Party. Global hereby acknowledges that (i) Renewable has committed to give Covanta the right to invest twenty-four percent (24%) of the total equity required in all Subject Projects identified by Renewable during the Initial Period and the Extended Period on substantially the same terms as are being offered to Global hereunder, such commitment and the terms and condition for making such equity investment to be reflected in the Investment Agreement, (ii) that Renewable and Covanta will follow substantially the same procedures as are outlined below and (iii) Global approves any such investment by Covanta. The following procedures are agreed to by Global and Renewable:

     (a) Equity Investment Notice. If a Finding Party decides to pursue a Subject Project, the Finding Party shall provide a written notice to the Other Party (an “Equity Investment Notice”) to advise the Other Party that the Finding Party wants to pursue the development of a Subject Project, such notice to include as much detail about the Subject Project as is available at the time, including the name of the Subject Project, the type of waste and supplier of waste for the Subject Project, any commercial terms regarding the tipping fees for the Subject Project and potential off-take arrangements, an estimate of the

Execution Copy 6

cost of developing the Subject Project, the pro forma for the Subject Project, if available, and any other information which is available to the Finding Party that might be relevant to the Other Party in making a decision to invest equity in the Subject Project. The Other Party shall have forty-five (45) days from the receipt of the Equity Investment Notice to review the information about the Subject Project and decide whether the Other Party wants to invest equity in the Project. During the forty-five (45) day period, the Finding Party shall use all reasonable business efforts to respond to any questions that are raised by the Other Party, and the Parties shall meet to discuss the Subject Project if either Party requests to do so. The Other Party shall have the right, in its sole discretion, to invest up to its maximum percentage of the total required equity for each Subject Project that is the subject of an Equity Investment Notice as provided for in Section 2.1, but in no event may the Other Party invest less than its minimum percentage of the total equity required as provided for in Section 2.1. If the Other Party elects to invest in a Subject Project, the Other Party shall provide a written response to the Finding Party (the “Equity Commitment Response”) prior to the expiration of the forty-five (45) day period indicating whether the Finding Party wants to invest equity in the Project and, if so, the total percentage of the required equity that it wants to invest. If the Other Party fails to respond in a timely manner to an Equity Investment Notice, it shall be deemed to be the delivery of a written notice that the Other Party is not interested in investing equity in the Subject Project. If the Equity Commitment Response indicates that the Other Party is not interested in providing any of the required equity for a Project (or if the Other Party is deemed to have delivered such a notice), then the Finding Party shall be free to pursue the Subject Project without any further obligation to offer the Other Party the right to invest equity in such Subject Project.

     (b) Equity Commitment Letter. If the Other Party decides it wants to invest a portion of the required equity for a Subject Project, the Parties shall cooperate together, in good faith, to enter into an equity commitment letter (the “Equity Commitment Letter”) based upon the form of equity commitment letter attached hereto as Exhibit 2 within thirty (30) days of the receipt of the Equity Commitment Response, which letter shall set forth (i) the total anticipated equity investment for the Subject Project, (ii) a tentative budget for the development of the Subject Project and a tentative schedule for the funding thereof, (iii) a tentative schedule for the funding of the equity for the Subject Project which shall be based on the anticipated terms for the relevant Purchase Order and the costs and installation schedule for the balance of the Subject Project, (iv) the percentage of the development costs and the total required equity to be provided by each Party and (v) such other terms as the Parties may mutually agree. Each Party hereby acknowledges that the anticipated development budget and funding schedule and the anticipated equity investment and funding schedule will only be estimates and that the actual development costs and funding schedule and the actual equity investment and funding schedule shall be what is required for the Subject Project. If Covanta agrees to invest a portion of the equity required for a Subject Project, the Parties shall cooperate with Covanta and include Covanta in the Equity Commitment Letter.

Execution Copy 7

     (c) Project Development Costs. Once Renewable identifies a Subject Project and starts pursuing the development of such Subject Project (or commences the development of a Subject Project identified by Global), Renewable shall track all of the third party costs and all of Renewable’s out-of-pocket expenses (the “Project Development Costs”) incurred in connection with pursuing, evaluating and developing the Subject Project until the development of the Subject Project is completed.

          (i) Subject Projects Identified by Renewable. Global and Renewable shall be responsible to fund the Global Percentage and the Renewable Percentage, respectively, of the Project Development Costs incurred for each Subject Project identified by Renewable. Promptly following the execution of an Equity Commitment Letter for a Subject Project that is identified by Renewable, Global shall reimburse Renewable for a portion of the Project Development Costs that Renewable has incurred through the date of the Equity Commitment Letter, such amount to be determined by multiplying the total Project Development Costs incurred through such date by the Global Percentage. Renewable shall provide a schedule of the Project Development Costs incurred to date to Global together with copies of all the third party invoices and any significant out-of-pocket costs. Thereafter, Global and Renewable (and Covanta if it has also agreed to participate in the Project) shall fund its share of the monthly estimate of the Project Development Costs, in advance, such amount to be reconciled following the end of each month by Renewable. If either Party (the “Failure to Fund Party”) fails to fund its full agreed share of the Project Development Costs on the required schedule and does not cure such funding default within ten (10) days following the receipt of a written notice to cure such funding default by the other Party, then, unless the other Party agrees otherwise in its sole discretion, the Failure to Fund Party shall forfeit its right to fund any of the equity for the Subject Project and shall only be entitled to receive a reimbursement of the Project Development Costs it has funded through the date of such forfeiture at the time that the Purchase Order for the Subject Project is issued by the Project Company formed for such Subject Project.

          (ii) Subject Projects Identified by Global. Global shall be responsible to fund 100 percent of the Project Development Costs incurred for each Subject Project identified by Global. Promptly following the execution of an Equity Commitment Letter for a Subject Project identified by Global, Global shall reimburse Renewable for all of the Project Development Costs that Renewable has incurred through the date of the Equity Commitment Letter. Renewable shall provide a schedule of the Project Development Costs incurred to date to Global, together with copies of all of the third party invoices and any significant out-of-pocket costs. Thereafter, Global shall fund a monthly estimate of the Project Development Costs, in advance, such amount to be reconciled following the end of each month by Renewable. If Global fails to fund the Project Development Costs on the required schedule and does not cure such funding default within thirty (30) days after the receipt of a written notice to cure such funding default by Renewable, then Renewable shall suspend work on the Project unless an alternate arrangement is reached by the Parties and Global shall reimburse Renewable for the work performed to date on the Subject Project.

Execution Copy 8

     d. Development of Subject Project; Development Fee. All major decisions regarding the development and financing of the Subject Project shall be jointly made by Renewable and Global (and Covanta if it has agreed to participate in the Subject Project), but Renewable shall have lead responsibility for the development and financing of the Subject Project. Global recognizes that Renewable will be incurring the burdened costs for its own personnel that are working on the development of the Subject Project and that such costs will not be included as part of the Project Development Costs funded by the Parties each month. To compensate Renewable for the burdened costs of its personnel in developing each Subject Project, the Parties agree that Renewable shall be paid a development fee of One Hundred Thousand Dollars ($100,000) for each KDV 500 that is installed as part of the Subject Project (such amount to be increased if the Subject Project uses a System other than a KDV 500 in proportion to the increased diesel output of the System installed), but in no event shall the development fee for a Subject Project exceed the sum of Two Million Dollars ($2,000,000), such fee to be paid as follows: (i) if the Subject Project is being financed by a lender, such fee to be paid at the closing of the financing for the Subject Project from the initial drawing of funds under the loan (it being agreed that Renewable will agree to defer up to fifty percent (50%) of such fee, if required by the lender(s) for the Project, to the completion of the construction of the Project); and (ii) if the Subject Project is not being financed by a lender, fifty percent (50%) to be paid at the time the initial payment is made under the Purchase Order for the Systems that are ordered for the Project and the balance when the Project has been accepted from AK.

     (e) Equity Investment in Subject Project. Prior to the execution of a Purchase Order for the Systems required for a Project, Renewable shall provide Global with an update of the total expected equity required for the Project and an updated schedule for the contribution of the equity. All equity invested in a Project shall be invested as a capital contribution to the limited liability company to be established by Renewable and Global for the Project. If a scheduled equity funding commitment is pending and one of the Parties (the “Delinquent Party”) determines it will not be able to fund all or part of its obligation, the Delinquent Party shall promptly provide written notice to the other Party (which shall in no event be less than ten (10) days’ prior to the date that such funding is due) indicating the amount, if any, of the equity that the Delinquent Party will fund on such date. If either Party fails to timely fund an equity funding commitment in accordance with the final equity funding schedule for the Project, in whole or in part, then, unless the other Party agrees otherwise in its sole discretion, the Party that fails to fund shall forfeit its right to fund any additional equity for the Project and the other Party shall fund the balance of the equity required for the Project. Notwithstanding anything contained herein to the contrary, if the equity that is required for the Project exceeds the amount that was estimated by the Parties, each Party shall fund a pro rata share of such equity as the funds are needed. Once the Project achieves commercial operation, the respective equity percentages of the Parties shall be determined based on the total amount of the equity that was actually funded by each Party.

Execution Copy 9

     (f) Operation and Maintenance of Projects. It is the intention of the Parties to engage a third party to operate and maintain each of the Projects based on a “cost plus” structure with a fixed annual fee. The Parties agree that they will seek a proposal from Covanta or one of its Affiliates using the form of agreement, if any, that has been agreed to by Global and Covanta for the projects that are being jointly pursued by Global and Covanta pursuant to the Business and Royalty Agreement.

     (g) Execution of LLCA. Each Subject Project in which the Parties both invest shall be owned by a separate limited liability company (each, a “Project Company”) formed to own and operate the Subject Project. Prior to executing the Purchase Order for a Subject Project, the Parties shall negotiate, in good faith, a limited liability company agreement (the “LLCA”) for the Project Company based on the standard form of LLCA agreed to by the Parties, it being agreed that each Subject Project will have its own unique requirements that will have to be addressed in the LLCA for the applicable Project Company. Within sixty (60) days of the execution hereof, Renewable will provide a proposed form of LLCA that is based on the relevant provisions of this Agreement and the key terms set forth in Exhibit 1 attached hereto. During the sixty (60) day period following the delivery of the initial draft of the LLCA, the Parties shall negotiate a standard form of LLCA to be used as the model for future LLCAs to be entered into by the Parties for projects to be jointly owned by the Parties during the Initial Period and the Extended Period and shall coordinate such form of agreement with the form being negotiated by Global and Covanta under the Business and Royalty Agreement. Once the Parties have finalized the standard form of LLCA, they shall execute a document confirming that such document is the standard form of LLCA and it shall replace the key terms set forth in Exhibit 2.

     (h) Sale of Interest in Projects. If Renewable or Global wants to sell its interest in any Subject Project in which the Parties have jointly invested, the Parties agree that any such sale shall be accomplished by the applicable Party (the “Selling Party”) selling its membership interest in the Project Company and any transfer by any Selling Party in contravention of the provisions of this Section 2.2(h) (whether by sale or transfer of an intermediate holding company or other direct or indirect transfer) shall be void and of no force and effect. Any such sale shall be subject to the restrictions and other conditions set forth in the LLCA for the Project Company. The LLCA shall require the Selling Party to first offer to sell the membership interest to the other Party in accordance with a formula price or an appraisal process, as the Parties shall determine when the standard form of LLCA is negotiated. If such other Party does not want to purchase the membership interest from the Selling Party, the Selling Party shall be entitled to sell the membership interest to any Person other than a competitor of such other Party unless such other Party consents to the sale in writing in its sole discretion.

     (i) Financing of Subject Projects. The Parties acknowledge that securing debt financing for each Subject Project may not be possible and that the funding for the initial Subject Projects is expected to be all in the form of equity, but the Parties agree that they will seek the maximum debt financing for the Subject Projects that is available. If the Parties agree to pursue a financing for a particular Subject Project prior to the placement

Execution Copy 10

of the Purchase Order for the Systems that are required for such Subject Project and the lender(s) for such Subject Project are not willing to accept the risk that one or both Parties will timely fund its equity commitments or any of its other support obligations to the Subject Project, each such Party shall be required to provide whatever credit support is required by such lender(s) for its equity investment and its share of any other equity support obligations, including a letter of credit in support of such commitments. Notwithstanding anything which is contained herein to the contrary, neither Party shall be under any obligation whatsoever to provide a “wrap” of the other Party’s equity obligation or any other credit support obligation of such other Party to the lender(s).

     (j) Take-Out Financings. Renewable and Global agree that if the conditions in the project finance market are generally favorable, the Parties will undertake to secure limited recourse take-out financing for multiple Subject Projects once they have operated successfully for a period of at least eighteen (18) months to enable Renewable and Global to recover some or all of the equity that each has invested in such Subject Projects. The Parties shall cooperate in good faith in pursuing and closing such financings. Each Party shall be required to provide whatever credit support is required by such lender(s) for its share of any equity support obligations for such take-out financing, including a letter of credit in support of such commitments. The proceeds of any such take-out financing shall be distributed to each Party in the ratio that such Party’s total equity investment in all of the Subject Projects that are the subject of such financing bears to the total equity investment of both Parties in all such Subject Projects.

     (k) Entitlements. In each Subject Project in which both Parties elect to invest, the Parties will form a Project Company as further provided for in Section 2.2(g) to own such Subject Project. As an owner of the Project Company, each Party (or its Affiliate) will be entitled to its pro rata share of all of the items of income, gain, loss, deduction and credit derived by the Project Company and its pro rata share of the net distributable cash flow of the Project Company.

ARTICLE 3 – CONDITIONS TO EFFECTIVENESS

Section 3.1 Payments to Trianon. On or before the Effective Date, Global shall provide Covanta with a statement showing all of the payments made to Trianon pursuant to the Consulting Agreement.

Section 3.2 Consulting Agreement with Trianon. On or before the Effective Date, Renewable shall cause Trianon to enter into an arrangement with Covanta to replace the Consulting Agreement. On the Effective Date, Renewable shall cause Trianon to provide a letter to Global confirming that the Consulting Agreement has been terminated.

Execution Copy 11

ARTICLE 4 – EFFECTIVE DATE AND TERM

Section 4.1 Effective Date. This Agreement shall become effective as of the date and year first above written (the “Effective Date”) so long as all of the conditions specified in Article III have been satisfied or waived by the Parties.

Section 4.2 Term of the Agreement. This Agreement shall continue in effect from the Effective Date until December 31, 2047 unless it is terminated earlier by either Party in accordance with the provisions of this Agreement or by the mutual written agreement of the Parties.

ARTICLE 5 – TERMINATION

Section 5.1 Termination Rights. This Agreement may be terminated by either Party in the case of the failure of the other Party to fulfill any of its material obligations hereunder (a “Default”) on ninety (90) days’ prior written notice to the Party in Default, such notice to specify the performance failure of such Party. Such termination shall not affect any of the obligations of the Parties in existence on the date of such termination, including (i) any existing obligations of the Parties in respect of existing Project Companies and (ii) any existing obligations of the Parties in respect of any of the Subject Projects which are the subject of other agreements that have been entered into by the Parties.

Section 5.2 Cure Rights. Notwithstanding anything contained herein to the contrary, a Party that is in Default shall be entitled to cure such Default by satisfying its performance obligation prior to the end of such ninety (90) day period. Furthermore, if such Party is diligently proceeding to cure such Default but such cure cannot be accomplished within such ninety (90) day period, the Party in Default shall be given up to an additional sixty (60) days to cure the Default so long as such Party continues to diligently pursue curing the Default. If the Default is cured by the Party that is in Default prior to the end of the cure period, then the notice of termination shall be null and void. If a Party fails to cure a Default, then this Agreement shall terminate on the date set forth in the notice of Default, but in no event prior to ninety (90) days following the issuance of such notice of Default.

ARTICLE 6 – REMEDIES

Section 6.1 Injunctive Relief and Specific Performance. The Parties acknowledge and agree that irreparable damage might occur if any of the provisions of this Agreement are not performed in accordance with their specific terms or are otherwise breached. It is therefore agreed that each of the Parties will be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in any court of the United States located in the State of New York or in any New York state court, this being in addition to any other remedy to which such Party is entitled at law or in equity.

Execution Copy 12

Section 6.2 Limitation of Liability. The Parties expressly waive any claims against each other and their respective Affiliates for indirect, special, non-compensatory, incidental, punitive, exemplary or consequential damages of any type, whether arising in contract or tort (including negligence, whether sole, joint or concurrent or strict liability), arising out of or relating to this Agreement or a breach hereof; provided, however, that this provision shall not waive any claims that the Parties may have under any other agreements entered into between the Parties. The limitations on liability and the remedies set forth in this Agreement have been expressly bargained for by the Parties and reflect the knowing allocation of the risks inherent in this Agreement between the Parties.

ARTICLE 7 – RESOLUTION OF DISPUTES

Section 7.1 Dispute Resolution. The Parties agree to cooperate with each other in good faith to try to resolve any controversy or dispute between them arising under this Agreement (each a “Dispute”) in accordance with the following procedures:

     (a) If a Dispute cannot be resolved informally, such Dispute shall initially be referred, through written notice by one Party to the other Party, to a meeting of senior management representatives of the Parties. The senior management representatives will meet to resolve the Dispute within fifteen (15) days following presentation of the matter to them.

     (b) If the Dispute cannot be resolved pursuant to Section 7.1(a), the Chief Executive Officers of the Parties shall meet to resolve the Dispute within fifteen (15) days following the conclusion of the consideration of the Dispute under Section 7.1(a) .

     (c) If the matter is not resolved within thirty (30) days of the written notice in Section 7.1(a), either Party may submit the Dispute to arbitration by submitting a Request for Arbitration pursuant to Article 4 of the Rules of Arbitration of the International Chamber of Commerce (the “ICC”) or such equivalent arbitration rules of the ICC then in effect (the “ICC Rules”), provided that nothing in this Agreement shall prevent or delay either Party from applying for interim or conservatory measures pursuant to Article 23 of the ICC Rules.

Section 7.2 Arbitration of Unresolved Disputes.

     (a) All Disputes arising out of or in connection with this Agreement that are not resolved in accordance with the provisions of Section 7.1 shall be finally settled under the ICC Rules by binding arbitration conducted in the English language and held in Washington, D.C. before a panel of three (3) arbitrators. Notwithstanding anything to the contrary in the ICC Rules, the following procedures shall apply for the appointment of the three (3) arbitrators. Each Party shall appoint one (1) arbitrator, obtain its appointee’s acceptance of such appointment and deliver written notification of such appointment and acceptance to the other Party within thirty (30) days from the date that the Dispute was submitted to arbitration. If a Party fails to deliver written notification of its appointment

Execution Copy 13

of an arbitrator and his/her acceptance within the time period provided in this Section 7.2, then such arbitrator shall be appointed by the ICC in accordance with the ICC Rules and be deemed a Party-appointed arbitrator for all purposes hereof. The first two arbitrators so selected shall select the third arbitrator (who shall act as chairman of the arbitration proceedings), prior to the thirtieth (30^th) day following the appointment of the second Party-appointed arbitrator. If the Party-appointed arbitrators are unable to select a neutral arbitrator, they shall jointly submit a list of four names (two each) to the ICC, which shall select the third arbitrator from the list submitted to it.

     (b) No arbitrator shall be a past or present employee or agent of, or consultant or counsel to, a Party or any Affiliate of a Party, unless such restriction has been waived in writing by the other Party to the proceeding.

     (c) The substantive law governing the Dispute shall be the laws of the State of New York.

     (d) The arbitrators shall have the sole power and authority to determine the arbitrability of any Dispute arising under or relating to this Agreement or the subject matter hereof. Subject to any other relevant limitations set forth elsewhere herein, the arbitrators will have the power to award any type of relief that is just and appropriate in the arbitrators’ discretion, including compensatory damages, injunctive orders, orders for specific performances and declarations of rights.

     (e) The arbitrators shall not have power, however, to award punitive, consequential, exemplary or treble damages or any other type of relief in the nature of a penalty, and the Parties hereby expressly waive any right they might otherwise have to such relief. THE PARTIES HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY WITH RESPECT TO ANY DISPUTE ARISING OUT OF OR RELATING TO THIS AGREEMENT.

Section 7.3 Finality; Enforcement. Any decision or award of a majority of an arbitral panel, as applicable, shall be final and binding upon the Parties. Each Party agrees that the arbitral award may be enforced against it or its assets wherever they may be found and that a judgment upon the arbitral award may be entered in any court having jurisdiction thereof. The Parties hereby waive any right to appeal or to review of the decision or the award of an arbitral panel by any court or tribunal and also waive any objections to the enforcement of such decision or award.

Section 7.4 Costs. The costs of arbitration shall be paid in accordance with the decision of the arbitral panel pursuant to the ICC Rules.

Section 7.5 Continuing Performance Obligations. The existence of any Dispute or the pendency of the Dispute resolution procedures set forth herein will not relieve or excuse a Party from its ongoing duties and obligations under this Agreement, and the Parties shall nevertheless proceed with the performance of this Agreement in accordance with the terms hereof.

Execution Copy 14

ARTICLE 8 – REPRESENTATIONS AND WARRANTIES

Section 8.1 Party Representations. As of the Effective Date, each Party represents and warrants to the other Party that:

     (a) It is duly organized and validly existing and, where applicable, is in good standing under the laws of the jurisdiction of its formation and it has all requisite power and authority to enter into and perform its obligations under this Agreement;

     (b) The execution, delivery and performance of this Agreement have been authorized and approved by its Board of Directors and do not and will not (i) violate any law, rule, regulation, order, decree or permit which is applicable to it or (ii) violate its organizational documents or any agreement to which it is a party;

     (c) This Agreement is a legal and binding obligation of such Party, enforceable against such Party in accordance with its terms, except to the extent enforceability is modified by bankruptcy, reorganization and other similar laws affecting the rights of creditors generally and by general principles of equity; and

     (d) There is no litigation pending or, to the best of its knowledge, threatened to which such Party, its parent or any of its subsidiaries is a party that, if adversely determined, would have a material adverse effect on the financial condition, prospects or business of such Party or its ability to perform its obligations under this Agreement.

Section 8.2 Additional Representation by Global. As of the Effective Date, Global is not in discussions with any Person relating to the use of the Technology in the United States other than Covanta and Renewable.

ARTICLE 9 – GENERAL PROVISIONS

Section 9.1 Expenses. Except as is otherwise expressly provided in this Agreement, each Party will bear its respective expenses incurred in connection with the preparation, execution and performance of this Agreement.

Section 9.2 Confidentiality. The Parties agree to maintain the confidentiality of this Agreement and the terms and conditions hereof. Any public announcements or similar publicity with respect to this Agreement shall be issued at such time and in such manner as the parties shall jointly determine. Notwithstanding the foregoing, each Party (and its Affiliates) shall have the right to make all such disclosures as required by applicable law or by any governmental body, including any stock exchange or securities market to whose regulations or disclosure requirements a Party is subject, without the consent of the other Party hereto; provided, however, that in the event of any such required disclosure, the disclosing Party (and its Affiliates), to the extent reasonably practicable, shall provide the other Party with advance notice of any such disclosure and an

Execution Copy 15

opportunity to comment thereon. The parties acknowledge that it is their intent to limit, to the fullest extent possible, any publicity regarding their joint cooperation during the Interim Period.

Section 9.3 Notices. All notices, consents, waivers and other communications under this Agreement must be in writing and will be deemed to have been duly given when (i) delivered by hand (with written confirmation of receipt), (ii) sent by telecopier (with written confirmation of receipt), provided that a copy is mailed by registered mail, return receipt requested, or (iii) when received by the addressee, if sent by a nationally recognized overnight delivery service (receipt requested), in each case to the appropriate addresses and telecopier numbers set forth below (or to such other addresses and telecopier numbers as a party may designate by notice to the other parties):

Global:

Global Energy, Inc.
Moshe Aviv Tower, 38^th Floor
Ramat Gan 52520, Israel
Attention: Asi Shalgi
Facsimile: +972-77-202-5445

Renewable:

Renewable Diesel, LLC
945 Ellington Lane
Pasadena, CA 91105, USA
Attention: Bruce I. Drucker
Facsimile: +1-815-361-9052

Section 9.4 Waiver. Neither the failure nor any delay by either Party in exercising any right, power or privilege under this Agreement shall operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power or privilege will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege. To the maximum extent permitted by applicable law, (i) no claim or right arising out of this Agreement can be discharged by one Party, in whole or in part, by a waiver or renunciation of the claim or right unless in a writing signed by the other Party, (ii) no waiver that may be given by a Party will be applicable except in the specific instance for which it is given and (iii) no notice to or demand on one Party will be deemed to be a waiver of any obligation of such Party or of the right of the Party giving such notice or demand to take further action without notice or demand as provided in this Agreement.

Section 9.5 Entire Agreement and Modification. This Agreement supersedes all prior agreements between the Parties with respect to its subject matter and constitutes a complete and exclusive statement of the terms of the agreement between the Parties with

Execution Copy 16

respect to its subject matter. This Agreement may not be amended except by a written agreement executed by the Party to be charged with the amendment.

Section 9.6 Assignment. Neither Party may assign its rights under this Agreement, in whole or in part, without the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed, except that each Party may make an assignment of this Agreement to an Affiliate (so long as such Party remains liable for its obligations hereunder following such assignment) and each Party may make a collateral assignment of its rights hereunder to one or more lender(s) in connection with the financing being arranged by such Party. In the case of a collateral assignment by one Party to one or more lenders, the other Party shall, if requested to so, negotiate the terms of a consent to assignment in good faith and enter into such consent without delay. Notwithstanding the foregoing, a Party may withhold its consent in the case of a proposed assignment to a Person that is a competitor of the Party whose consent is being sought.

Section 9.7 Severability. If any provision of this Agreement is held to be invalid, illegal or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of this Agreement held invalid, illegal or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid, illegal or unenforceable.

Section 9.8 Governing Law. This Agreement will be governed by, and construed in accordance with the laws of, the State of New York without regard to its conflicts of law (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law).

Section 9.9 No Power of Representation. Neither Party shall have the authority or right under this Agreement to, nor shall either Party hold itself out as having the authority or right under this Agreement to, (i) assume, create or undertake any obligation of any kind whatsoever, express or implied, on behalf of or in the name of the other Party without the express prior written consent of such other Party or (ii) accept service of any legal process addressed to or intended for such other Party.

Section 9.10 No Partnership. Nothing in this Agreement shall be construed as creating a partnership, association, joint venture or any other legal entity between the Parties (including their Affiliates), nor a fiduciary relationship between the Parties (including their Affiliates).

Section 9.11 No Third Party Beneficiaries. No provision of this Agreement is intended or is to be construed to confer upon any Person, other than the Parties and their respective Affiliates and successors and permitted assigns, any rights or remedies under or by reason of this Agreement.

Section 9.12 Compliance with Law. Each Party and its Affiliates shall comply with all applicable laws, including the Foreign Corrupt Practices Act of 1977 of the United States of America (15 U.S.C. §§ 78dd-1, et seq.), in its or their performance of any activities hereunder.

Execution Copy 17

Section 9.13 Counterparts and Facsimile Signatures. This Agreement, and any other agreement, instrument, certificate of other documents desirable to be executed and delivered in order to consummate the Contemplated Transactions, may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. Any such document may be executed by facsimile signature.

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

GLOBAL ENERGY, INC.
By:	/s/ Asi Shalgi
	Asi Shalgi, Chief Executive Officer
RENEWABLE DIESEL, LLC
By:	/s/ Bruce I. Drucker
	Bruce I. Drucker, Chief Executive Officer

Execution Copy 18

EXHIBIT 1 – KEY TERMS OF LLCA

The following assumes that the Project to be owned by the Project Company will be owned solely by Global and Renewable. If Covanta is entitled to and elects to invest equity in the Project Company, the following terms shall be modified to account for the ownership of Covanta in the Project Company, consistent with the key terms outlined in Exhibit 1 of the Business and Royalty Agreement.

Newly Formed Entity:	As is provided for in Section 2.2(g), Renewable shall form a separate limited liability company (the “Project Company”) for each Project that is to be owned jointly by Renewable and Global.
State of Organization:	Unless the Parties agree otherwise, the Project Company shall be formed under the laws of the State of Delaware and shall be authorized to do business in all such other states as required for the ownership and operation of the Project.
Members:	The members of the Project Company (the “Members”) shall be Renewable or its Affiliate and Global or its Affiliate.
Board of Managers:	The business and affairs of the Project Company shall be managed and directed by a board of managers (the “Board of Managers”) consisting of three (3) individual Managers, each entitled to one vote. Global shall appoint two of the Managers so long as it owns a majority percentage of the Project Company and Renewable shall appoint one of the Managers. If Global owns less then a majority percentage of the Project, the foregoing rights shall be reversed. It is further agreed, notwithstanding the foregoing, that to have the right to appoint a Manager, a Party must be committed to invest at least twenty percent (20%) of the total equity required for the Project in the Project Company (the “Total Required Equity”). If a Party has committed to invest less than twenty percent (20%) of the Total Required Equity, such Party shall not have the right to appoint a Manager and the other Party shall appoint all of the Managers of the Project Company. If a Party that has committed to invest at least twenty percent (20%) of the Total Required Equity fails to actually fund at least such percentage, such Party shall lose its right to appoint any Managers thereafter.

Execution Copy 19

	If the Project Company is owned by Global, Covanta and Renewable, the Board of Managers shall consist of four (4) individual Managers. Global (as long as it owns a majority percentage of the Project Company) shall appoint two of the Managers and Covanta and Renewable shall each appoint one of the Managers (subject to the same rules with respect to the minimum ownership requirement.
Meetings of Board:	The Board of Managers may take actions by the unanimous consent of the Managers without a meeting or by a majority vote at any regular or special meetings, subject to at least fifteen (15) days’ prior notice for special meetings to allow all the Managers to be present at the meeting. The presence of two Managers shall constitute a quorum for the Board of Managers to vote on matters; provided, however, that the Board of Managers shall not be authorized to vote on any matter that requires a Unanimous Decision (defined below) unless a Manager appointed by each of the Parties attends the meeting (but only if a Party is authorized to appoint one of the Managers as provided for herein).
Unanimous Decisions:	The following decisions shall require the unanimous vote of the Board of Managers (each a “Unanimous Decision”):
	(i)	Any consolidation, liquidation, reorganization, winding-up, merger or sale of the Project Company;
	(ii)	A transfer, assignment or sale of all or substantially all of the assets or business of the Project Company;
	(iii)	Any action that would alter or change any of the rights, privileges, obligations or liabilities or Global or dilute the voting interest of Global;
	(iv)	The incorporation, establishment or acquisition of an ownership interest in any other entity;
	(v)	Entering into any partnership or joint venture;
	(vi)	Securing debt financing for the Project Company, including the terms of such financing;
	(vii)	Decisions regarding tax elections, the adjudication of tax disputes, the settlement of tax disputes and other tax matters of the Project Company to the

Execution Copy 20

		extent any such decision could have a material adverse effect on a Party;
	(viii)	The offering of equity interests in the Project Company on a public securities market;
	(ix)	Any material modification or amendment to the Certificate of Formation of the Project Company or the LLCA; and
	(x)	Any contract or other transaction entered into by the Project Company and a Member or any Affiliate of a Member.
Ownership:	All property, assets and work product which is developed by the Project Company shall be owned by and in the name of the Project Company and not in the name of any of the Members or Managers.
Pro Rata Interests:	The Members shall be entitled to their pro rata share of each item of income, gain, loss, deduction and credit derived by the Project Company and to their pro rata share of the net distributable cash flow of the Project Company.
Officers:	The Board of Managers will have the authority to designate officers of the Project Company, which shall consist of at least a President, a Secretary and a Treasurer. The Board of Managers may appoint such other officers and agents as it shall deem necessary or advisable, who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Managers. Neither the Managers nor the officers shall receive compensation for their services to the Project Company in such capacities.
Employees:	The Project Company shall not have any employees. All services shall be performed under service contracts by third parties.
Limitation of Liability:	None of the Members, Managers and officers of the Project Company shall be obligated personally for any of the debts, obligations or liabilities of the Project Company solely by reason of being a Member, a Manager or an officer of the Project Company.

Execution Copy 21

Tax Status:	It is the intention of the Members that the Project Company be treated as a partnership for federal tax purposes and all relevant state tax purposes, where possible.
Restrictions on Transfer:	Each Member may sell or transfer all or a portion of its membership interest in the Project Company to a third party, subject, however, to the Right of First Refusal of the other Member as set forth below.
	Notwithstanding the foregoing, any Member may transfer its economic interest in such Member’s ownership interest in the Project Company to an Affiliate; provided, however, that such transfer shall give the transferee only the right to receive distributions, income, gain and loss allocable to such Member’s ownership interest to which such Member would otherwise be entitled.
Right of First Refusal:	If any Member wishes to sell its membership interest in the Project Company to a non-Affiliate, such offering Member shall first offer to sell its membership interest to the other Members by delivering notice which shall include the terms of the offer. Each other Member shall have the right to purchase all of the membership interest so offered. If none of the Members accept the offer, the offering Member may transfer all of its membership interest to a third party on terms no more favorable to the third party than those originally offered to the other Members, subject to the consent of the other Members as provided above.
Dispute Provision:	Unless the Parties agree otherwise, the dispute provisions set forth in Article 9 of the Agreement shall be incorporated in the LLCA.

Execution Copy 22

EXHIBIT 2 – FORM OF EQUITY COMMITMENT LETTER

The following assumes that the Project will be owned by Global and Renewable. If Covanta is entitled to and elects to invest equity in the Project, the following terms shall be modified to account for the ownership of Covanta in the Project. The following further assumes that any Projects that are identified by Global will be evaluated by Renewable and, if Renewable elects to participate in such Projects, that Renewable will send out the equity commitment letter to Global.

[RENEWABLE LETTERHEAD]

____________ __, 20__

Mr. ________________

[Global Energy, Inc. or Relevant Affiliate]
Moshe Aviv Tower, 38^th Floor
Ramat Gan 52520, Israel

     Re: Equity Commitment

This letter will confirm the commitment of [Global Energy, Inc., a Delaware corporation] (“Global”) and [Renewable Diesel, LLC., a Delaware limited liability company (“Renewable”)], to invest equity in the ___________________project (the “Project”) being developed in _____________________.

Renewable [has formed/will form] a limited liability company (the “Project Company”) under the laws of the State of Delaware and [has qualified/intends to qualify] the Project Company to do business in _______________.

Renewable estimates that the total capital cost of the Project, including all the development costs, engineering, procurement and construction costs, start-up costs and initial working capital, is $__________(the “Total Required Equity”). The current capital cost budget is attached hereto as Schedule 1. Renewable shall update the capital cost budget from time to time as the development of the Project proceeds and provide such updates to Global.

A tentative schedule for the funding of the Total Required Equity, on a monthly basis, is attached hereto as Schedule 2. Renewable shall update the funding schedule from time to time as the development of the Project proceeds and provide such updates to Global.

The Parties hereby acknowledge and agree that the Total Required Equity and the tentative equity funding schedule are estimates and that the ultimate equity investment and equity funding schedule shall be what is actually required for the Project once a Purchase Order is to be issued and construction of the Project is to proceed.

Execution Copy 23

The Parties shall each provide the following percentage of the Total Required Equity:

Global:
Renewable:

[As the percentage is less than twenty percent (20%) of the Total Required Equity, Global/Renewable shall not have the right to appoint an individual to the Board of Managers of the Project Company.] [This sentence shall only be included in the letter if one party commits to invest less than twenty percent (20%) of the Total Required Equity.]

Once the development of the Project advances to a point where Renewable believes that the Project is likely to proceed, Renewable will prepare a draft of the limited liability company agreement (the “LLCA”) for the Project Company based on the model agreement that was negotiated by the parties under the Business and Development Agreement and provide it to Global for review. Thereafter, the parties shall cooperate together in good faith to negotiate and finalize the terms of the LLCA.

In connection with the Project, the parties have further agreed as follows:
____________________________________________________________________________________________________________________________.

Please confirm the amount of your equity commitment and your acceptance of the other terms of this equity commitment letter agreement by signing in the space provided below and returning it to me within thirty (30) days of the date hereof.

Sincerely yours,

Name:

Title:

[Renewable Diesel, LLC]

[Global Energy, Inc.] hereby confirms that it will provide ________ percent (__%) of the Total Required Equity and that it agrees with all the terms of this equity commitment letter agreement.

By:

Name:

Title:

Date:

Execution Copy 24

SCHEDULE 1 – TOTAL CAPITAL BUDGET

SCHEDULE 2 – PRELIMINARY EQUITY FUNDING SCHEDULE

Execution Copy 25

EX-10.27

THE SYMBOL “*****” DENOTES PLACES WHERE PORTIONS OF THIS DOCUMENT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. SUCH MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

Exhibit 10.27

LICENSE AGREEMENT

     This License Agreement (this “Agreement”) is made and entered into as of the 6^th day of February, 2008, by and between AlphaKat - Global Energy GmbH, a company organized and existing under the laws of Germany (“Licensor”), and American Renewable Diesel, LLC, a limited liability company organized and existing under the laws of the State of Delaware (“American”).

     WHEREAS, AlphaKat GmbH, a company organized and existing under the laws of Germany (as further defined below, “AK”), has granted certain rights to Licensor with respect to a proprietary technology to convert waste material that contains hydrocarbons into diesel oil (as further defined below, the “Technology”) in various countries, including the United States;

     WHEREAS, American is interested in obtaining license rights from Licensor with respect to the Technology, all on the terms and conditions set forth herein, to secure or to help secure orders for the sale of the equipment that utilizes the Technology; and

     WHEREAS, Licensor is willing to grant such license rights to American, all on the terms and conditions set forth herein;

     NOW, THEREFORE, in light of the mutual premises set forth herein and other good and valuable consideration, the receipt and the sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows.

ARTICLE 1 – DEFINITIONS AND INTERPRETATION

Section 1.1 Capitalized Terms. Unless otherwise specified herein, the following capitalized terms shall have the following meanings:

     “Affiliate” means, in relation to any Person, any other Person that controls, is controlled by, or is in common control with, such Person. For the purpose of this definition, control means the direct or indirect control of fifty percent (50%) or more of the voting rights in such Person or the power to direct the management or policies of such Person, whether by operation of law, by contract or otherwise. Except as shall otherwise be expressly provided in this Agreement, and for the avoidance of any doubt, as of the Effective Date, (i) Licensor and AK are Affiliates and (ii) Licensor and Global are Affiliates, but AK and Global are not Affiliates.

     “Agreement” has the meaning set forth in the first paragraph hereof.

     “AK” means AlphaKat GmbH, a company organized and existing under the laws of Germany, and its successors and permitted assigns.

     “American” has the meaning set forth in the first paragraph hereof and includes its successors and permitted assigns.

     “Commercial Waste” means all non-hazardous solid waste that is collected from commercial establishments, including residential apartment buildings, office buildings, restaurants, industrial parks, all other business facilities and all recyclable materials from recycling facilities.

     “Competitor of Licensor” means a Person, directly or through Affiliates, engaged primarily in the business of selling equipment that converts waste or organic feedstock(s) containing hydrocarbon materials into diesel fuel or any Person that is involved primarily in the development of such equipment or the technology on which it is based.

     “Contracted Waste” means all non-hazardous waste, regardless of the source of such waste, which is under contract to be delivered to Covanta or any of its Affiliates for disposal in, or processing by, one of the facilities owned or operated by Covanta or any of its Affiliates.

     “Covanta” means Covanta Energy Corporation, a Delaware corporation.

     “Covanta License Agreement” means the License Agreement of even date herewith entered into between Licensor and Covanta, a copy of which is attached hereto as Exhibit 1.

     “Customer” means any Person that is not owned or controlled by American that wants to purchase a System for its own account.

     “Default” has the meaning set forth in Section 10.1.

     “Demonstration Plant” means the System to be purchased by Covanta as provided for in the Covanta License Agreement, the order for which has been procured by American.

     “Dispute” has the meaning set forth in Section 9.1.

     “Effective Date” has the meaning set forth in Section 5.1.

     “Extended Period” means the period that begins on the date that the Initial Period terminates and ends on the date that this Agreement terminates.

     “Feedstock” means Household Waste, Contracted Waste, Commercial Waste or Radial Biomass, as the case may be.

Execution Copy

2

     “Full Right” means that the Person being granted the right(s) described herein shall be the only Person that is entitled to exercise such right(s) so long as this Agreement is in effect and that no other Person shall be authorized, by the grantor of such right(s), to exercise such right(s) or be granted such right(s).

     “Global” means Global Energy, Inc., a Nevada corporation.

     “Household Waste” means all non-hazardous, post-recycled municipal solid waste which is collected from residences, which waste is of the type normally accepted for processing at waste to energy facilities in the United States.

     “ICC” means the International Chamber of Commerce.

     “ICC Rules” has the meaning set forth in Section 9.1.

     “Improvements” means all the techniques, enhancements, modifications, changes, experience, methods, information, data or knowledge that will be created or acquired in the future relating to the Technology and/or the manufacturing of such components for Systems (whether or not patentable, useful or workable) through the implementation, development, testing and improvement of the Technology.

     “Initial Period” means the period which begins on the date that the Interim Period ends and terminates on the second (2^nd) anniversary thereof.

     “Intellectual Property” means any intellectual property and/or proprietary information and materials relating to the Technology along with all rights therein, whether existing before or conceived or developed after the Effective Date (except as otherwise expressly provided), including: (i) patents, patent applications, patent disclosures and inventions (whether or not patentable and whether or not reduced to practice), including the Patents; (ii) trademarks, service marks, trade dress, trade names, corporate names, logos, slogans and Internet domain names, together with all goodwill associated with each of the foregoing; (iii) copyrights and copyrightable works; (iv) trade secrets, confidential information and know-how (including ideas, formulae, compositions, manufacturing and production processes and techniques, research and development information, test data and results, drawings, specifications, designs, supplier lists and related information); and (vi) registrations, applications, divisionals, continuations, continuations-in-part, foreign counterparts and renewals for any of the foregoing.

     “Interim Period” means the period which begins on the Effective Date and ends twelve (12) months following the date that the Demonstration Plant has been successfully commissioned and is ready for commercial operation; provided, however, that if the Demonstration Plant passes the performance test that is agreed to by AK and Covanta (all as further provided for in Section 2.2(c) of the Covanta License Agreement) more than thirty (30) days prior to the scheduled end of the Interim Period, the Interim Period shall terminate thirty (30) days following the date that the Demonstration Plant has passed

Execution Copy

3

such performance test, Licensor to provide a notice to such effect to American in writing; provided further, however, that the Interim Period shall in no event be longer than two (2) years.

     “KDV 500” means the system of components, including all of the structural steel, piping, pumps, vessels, control systems, wiring, two proprietary “mixing turbine pumps” and the operations, maintenance and start-up manuals provided by AK, to convert hydrocarbon feedstock, including any Feedstock, into diesel oil using the Technology which is capable of producing a minimum of 500 liters of diesel oil per hour.

     “Licensor” has the meaning set forth in the first paragraph hereof and includes its successors and permitted assigns.

     “Parties” means Licensor and American.

     “Party” means Licensor or American, as the case may be.

     “Patents” means any existing or future patent applications, patents, registrations, utility models and utility model applications relating to the Technology which are necessary or useful to manufacture or to sell, offer for sale, use or otherwise make available Systems or the components of Systems, including those set forth in Exhibit 2 attached hereto.

     “Person” means any natural person, corporation, company, partnership, business trust, governmental authority or other entity.

     “Purchase Order” has the meaning set forth in Section 2.5.

     “Purchaser” has the meaning set forth in Section 2.5.

     “Qualified Right” means that the Person being granted the right(s) described herein shall be entitled to exercise such right(s) so long as this Agreement is in effect, but the grantor of such right(s) shall be entitled to grant such right(s) or allow such right(s) to be exercised by all other Persons except a Person that is precluded from exercising such right(s) under the express terms hereof.

     “Radial Biomass” means biomass, including wood, wood waste and other types of cellulosic materials which are collected within or from an area within a 100 mile radius of any biomass facility owned by Covanta or an Affiliate of Covanta in the states of California or New York as of the Effective Date.

     “Rights Agreements” means (i) the “Terms of Agreement” dated May 2, 2007, (ii) the “Shareholders’ Agreement” dated July 10, 2007 and (iii) the Articles of Association of Licensor dated November 14, 2007 and November 22, 2007, a copy of each of which is attached hereto in Exhibit 2.

Execution Copy

4

     “System” means any system of components, whether it is in existence today or developed hereafter, including all of the structural steel, piping, pumps, vessels, control systems, wiring, the proprietary “mixing turbine pump(s),” any new components of any future system of components and all of the operations, maintenance and start-up manuals provided by AK, to convert hydrocarbon feedstock, including any Feedstock, into diesel oil using the Technology, including, for the avoidance of doubt, the KDV 500.

     “Technology” means the proprietary, renewable diesel technology developed by Dr. Christian Koch (as well as any related technology licensed to Dr. Christian Koch or to AK) to convert municipal solid waste, organic materials, sludge and other hydrocarbon materials, including Feedstock, to diesel oil, including all Improvements to such technology made or acquired from time to time, including Intellectual Property, Systems, the formulation of catalysts used in Systems and all related materials and information.

     “Territory” has the meaning set forth in Section 2.1.

     “Third Party Purchaser” has the meaning set forth in Section 2.5.

Section 1.2 Interpretation. In this Agreement, unless otherwise indicated or required by the context:

     (a) Reference to and the definition of any document (including this Agreement) or any applicable law shall be deemed a reference to such document or applicable law as it may be amended, supplemented, revised or modified from time to time;

     (b) All references to an “Article,” “Section” or “Exhibit” are to an Article or Section hereof or to an Exhibit attached hereto;

     (c) Article and Section headings and other captions are for the purpose of reference only and do not limit or affect the meaning of the terms and provisions hereof;

     (d) Defined terms in the singular include the plural and vice versa, and the masculine, feminine and neuter gender include all genders;

     (e) The words “hereof,” “herein” and “hereunder” and words of similar import refer to this Agreement as a whole and not to any particular provision of this Agreement; and

     (f) The words “include,” “includes” and “including” mean include, includes, and including “without limitation” and “without limitation by specification.”

Execution Copy

5

ARTICLE 2 – LICENSE RIGHTS

Section 2.1 Grant of License Rights. Subject to the terms of this Agreement, Licensor hereby grants American the Full Right in the Territory to market and sell Systems and utilize the Technology. As of the Effective Date, the territory (the “Territory”) shall be the states of California, New York and Texas, it being agreed that Licensor shall not grant any Person the right to sell Systems in New Jersey or Florida before the date by which American must satisfy the requirement set forth in clause (ii) of the first sentence of Section 2.1(b) . For the avoidance of doubt, American shall be entitled to exercise any or all of the license rights that are granted to it in the Technology itself or through any of its Affiliates, but American shall not have the right to issue sublicenses to any Person other than an Affiliate. The Parties further agree as follows:

     (a) Notwithstanding anything that is contained herein to the contrary, American shall be credited for the sale of all of the Systems sold to Covanta during the term of this Agreement regardless of whether such Systems are for use inside or outside the Territory.

     (b) American shall be required to secure or to help Licensor or Global to secure (i) an order for one KDV 500 prior to the end of the Interim Period (it being agreed that the Purchase Order being placed by Covanta for the Demonstration Plant satisfies this requirement) and (ii) orders for an additional two KDV 500s prior to the end of the Initial Period. If American fails to secure or help Licensor or Global to secure orders for a total of three KDV 500s prior to the end of the Initial Period, Licensor shall have the right, in its sole and absolute discretion, to notify American that it must give up its Full Rights for one (1) of the states in the Territory (such state to be selected by American). If American meets the two (2) requirements set forth in this Section 2.1(b), the Territory thereafter shall be the states of California, New York, Texas, New Jersey and Florida. The phrases “secure orders” as used herein mean that a Person has executed a Purchase Order for one or more KDV 500s and made the initial deposit thereunder.

     (c) Licensor acknowledges and agrees that the ability of American to meet the requirements set forth in this Section 2.1 will depend, in part, on the initial three KDV 500s installed in the United States (including the Demonstration Plant) demonstrating the technical and financial viability of the Technology. Notwithstanding anything contained herein to the contrary, (i) if there is any delay in the installation of any of the initial three (3) KDV 500s in the United States, including the Demonstration Plant (with such KDV 500s meeting all performance guarantees), beyond the date committed by AK in the applicable Purchase Order or (ii) if any such KDV 500s experience operating or financial problems due to a failure of the KDV 500 to operate in accordance with its performance guarantees, then all of the time periods set forth in this Section 2.1 shall be extended automatically for the full period of all such delays for all purposes hereof.

Execution Copy

6

     (d) During the Extended Period, American shall be required to secure orders for: (i) two (2) KDV 500s per year for each of the first two (2) full calendar years of the Extended Period; (ii) five (5) KDV 500s per year for each of the next two (2) calendar years of the Extended Period; and (iii) ten (10) KDV 500s per year for each calendar year thereafter, each such determination to be made on a cumulative basis (such that American shall be entitled to credit additional KDV 500s sold in one year above the minimum requirement for that year to a later year). If American fails to meet any such targets in any calendar year during the Extended Period, Licensor shall have the right, in its sole discretion, to notify American that it shall only have a Qualified Right in all of the states in the Territory to market and sell Systems and utilize the Technology for the remainder of the term of this Agreement. Licensor agrees that all Systems sold by Licensor outside the Territory that are pursuant to a referral made by American shall count towards American’s minimum purchase requirements hereunder. However, none of the Systems purchased by Covanta or an Affiliate of Covanta for its own account during the Extended Period shall count towards meeting American’s minimum purchase requirements unless the sale of Systems is to a project developed by American or an Affiliate of American in which Covanta is an investor.

     (e) For purpose of meeting any of the minimum order thresholds for KDV 500s which are set forth in this Section 2.1, if a System is developed by AK (such as the “KDV 2000” which is currently under development by AK) that is capable of producing a higher amount of diesel oil per hour than a KDV 500 (expected to be 2,000 liters per hour in the case of a “KDV 2000” as compared to 500 liters per hour for a KDV 500), then such System will count as more than one KDV 500 based on the amount of diesel oil per hour capable of being provided (expected to be four KDV 500s in the case of a “KDV 2000”).

     (f) Notwithstanding anything contained herein to the contrary, American shall not lose its Full Rights in any state in the Territory if it fails to meet the cumulative order requirements in Section 2.1(b) or (d) if (i) AK is not able to produce enough Systems to meet the Purchase Orders secured by American, Licensor and Global or (ii) any problems experienced with the Technology in the Systems installed by AK make it commercially unreasonable for American to secure orders for any additional Systems until such problems have been resolved, in which case the Parties shall agree to an equitable adjustment, in good faith, to the cumulative requirements provisions of Sections 2.1(b) and (d) or extend the date for such requirements to be performed.

     (g) If American fails to meet its performance obligations under this Section 2.1 and Licensor elects to require American to give up its Full Rights in one or more of the states in the Territory as further provided for herein, American’s sole penalty will be for its rights in such state(s) to become a Qualified Right to market and sell the Technology for the remainder of the term of this Agreement.

Section 2.2 Obligation to Make Referrals. If any Person contacts Licensor or any of its Affiliates regarding the purchase of one or more Systems for installation in the Territory, Licensor shall refer such Person to American.

Execution Copy

7

Section 2.3 Sales to Covanta Energy. The sale of all Systems to Covanta or to any of its Affiliates, including the Demonstration Plant, shall be pursuant to Purchase Orders placed with AK through Licensor, and American shall derive a license fee on all such sales. Licensor shall mark up the cost of all of the Systems that are sold to Covanta or any of its Affiliates (other than the System for the Demonstration Plant) by ten percent (10%) and pay fifty percent (50%) of such amount to American as its commission. Such commissions shall be paid to American as the payments that are due from Covanta or its Affiliates are received under the applicable Purchase Order.

Section 2.4 Commission on Sales to Other Customers. American shall be entitled to a commission of five percent (5%) on all Systems that are sold in the Territory. If American identifies a Customer that is interested in purchasing one or more Systems in an area that is outside the Territory, American shall refer such Customer to Licensor and, if such sale is completed (the decision to complete such sale to be made by Licensor in its sole discretion), American shall be entitled to a commission of five percent (5%) on such sale. Licensor shall mark up the cost of all of the Systems on which American is entitled to a commission by ten percent (10%) and pay fifty percent (50%) of such amount to American as its commission. Commissions shall be paid to American as the payments that are due under the applicable Purchase Orders are received. For the avoidance of doubt, in connection with Customers that are identified by American outside of the Territory, Licensor shall be obligated to pay the commission to American if the System is sold within two (2) years after the Customer is identified to Licensor by American.

Section 2.5 Purchase Orders. All purchase orders for System(s) (“Purchase Orders”) shall be entered into by and between AK (or its designee) and the ultimate purchaser of such System(s) (the “Purchaser”), although all Purchase Orders shall be placed through Licensor and provide for the payment of a sales commission to Licensor (except for the Systems sold for the Demonstration Plant). Each Purchase Order shall include a set of representations and warranties made by AK to the Purchaser which are consistent with those provided by Licensor to American in Article 8 and a non-exclusive, irrevocable and perpetual license (a “Use License”) for the Purchaser to (i) use, practice, operate, maintain, repair and make Improvements to the System(s), (ii) purchase the catalyst that is required for the operation of the System(s) from AK and/or any Person that is authorized to manufacture and/or sell such catalyst by AK, (iii) purchase components and spare parts for the System(s) from AK and/or any Person that is authorized to manufacture and/or to sell such components and spare parts and (iv) reproduce, modify and internally distribute copies of any and all materials and information received by American from Licensor and/or AK relating to the System(s), in whole or in part. In addition, if the Purchaser sells or transfers any of the System(s) to any Person (a “Third Party Purchaser”), the Purchaser shall be entitled to transfer its Use License to such Third Party Purchaser and each Third Party Purchaser shall be entitled to transfer such Use License to another Third Party Purchaser. Notwithstanding anything to the contrary contained or implied in clauses (ii) or (iii) of this Section 2.5, all Purchasers and all Third Party Purchasers shall be entitled to procure components, spare parts and catalysts that

Execution Copy

 8

are commercially available from any Person. Further, if AK and the Persons authorized to make spare parts and components that are not commercially available are unable to timely supply the spare parts and components ordered by a Purchaser or a Third Party Purchaser, such Purchaser or Third Party Purchaser shall be authorized to purchase such spare parts and components from any other Person and to make such spare parts and components itself.

ARTICLE 3 – ANNUAL PRICING; NO ROYALTIES

Section 3.1 Annual Pricing. Licensor, American and AK shall agree on a procedure to establish the price, at the end of each November, for the following year, of (i) Systems, (ii) the catalyst that is used with the Technology, (iii) replacement/spare parts for Systems and (iv) the cost for AK or Licensor to provide services on Systems or other engineering services in order to (a) ensure that such prices are not increased inappropriately from year to year and (b) to provide price certainty to American for the upcoming year in connection with its sales and marketing efforts. The Parties are aware that the current price of a KDV 500 includes a technology fee of [*****] and acknowledge that the minimum technology fee to AK from the sale of a System in the future, as arrangements are put in place by AK to broaden the manufacturing base and reduce the total cost of the Systems will include a technology fee not to exceed [*****]. Licensor, American and AK shall use their best efforts to negotiate in good faith and agree as soon as practicable to the terms of such procedure and any other mechanisms that may be necessary or helpful to determine the pricing for the Systems or any other items. Licensor shall provide American, prior to the end of each November, with the updated pricing for the following year. Licensor further agrees (and AK, by its execution of this Agreement in the space provided below, agrees) that American’s Customers will not be charged more during any year for a System than the lowest price that is paid by any other licensee of Licensor or customer of AK for a comparable System in such year in the United States.

Section 3.2 No Royalties. Neither American (or its Affiliates) nor any Purchasers or Third Party Purchasers shall be required to pay royalties to Licensor, AK, Global or any other Person in connection with the exercise by American or its Affiliates of any of the license rights in the Technology granted under this Agreement.

ARTICLE 4 – CERTAIN OBLIGATIONS OF THE PARTIES

Section 4.1 Supply of Information. Licensor shall supply American from time to time with all information relating to the installation and operation of Systems reasonably required or requested by American. Further, Licensor and/or AK shall provide American with any revised or updated installation or operating manuals or bulletins as soon as such materials are completed and available for distribution.

Execution Copy

9

Section 4.2 Provision of Technical Assistance. Notwithstanding Section 4.1, Licensor shall not have any obligation to provide any engineering services or technical assistance regarding the Technology or the Systems under this Agreement. Any such services and assistance may be provided under other agreements with Licensor or with AK.

Section 4.3 Acknowledgment and Agreement. Licensor shall arrange for Dr. Christian Koch to execute this Agreement in the space that is provided below, on behalf of himself and in his capacity as the President of AK, to evidence (i) their acknowledgement that they have reviewed this Agreement and agree to any obligations on their parts, (ii) their consent to the terms of this Agreement and (iii) their agreement for AK to enter into a substantially similar form of license agreement with American if the rights of Licensor pursuant to or as contemplated by the Rights Agreements are not supplemented to the extent necessary to enable Licensor to grant all of the rights being granted to American hereunder or if any such rights granted to Licensor are terminated for any reason, such new license agreement to preserve American’s Full Rights and/or Qualified Rights in the Territory.

ARTICLE 5 – EFFECTIVE DATE AND TERM

Section 5.1 Effective Date. This Agreement shall become effective on the date that it has been signed by both of the Parties and by Dr. Christian Koch (the “Effective Date”).

Section 5.2 Term of the Agreement. This Agreement shall continue in effect from the Effective Date until July 1, 2028 unless it is terminated earlier by the provisions hereof or by either Party in accordance with its rights hereunder.

ARTICLE 6 – INTELLECTUAL PROPERTY

Section 6.1 No Transfer of Ownership of the Technology. The Parties agree that this Agreement shall not transfer the ownership of the Technology or any of the Intellectual Property therein, and that American will not have any right, title or interest in or to the Technology, except as expressly licensed to American pursuant to this Agreement or any separate agreement.

Section 6.2 Improvements. All Improvements conceived, developed or acquired by AK or Licensor during the term hereof shall be included under the license rights granted herein. All such Improvements conceived, developed or acquired exclusively by AK or Licensor shall remain the property of AK or Licensor, respectively.

Execution Copy

10

ARTICLE 7 – INFRINGEMENT AND DESIGNATIONS

Section 7.1 Notice of Infringements. During the term hereof, Licensor and American shall promptly notify each other in writing with respect to any claim of infringement of any Patent or other right asserted against it by any Person arising out of the exercise of the rights being granted hereunder.

Section 7.2 Indemnity for Infringement or Misappropriation. Licensor shall indemnify and hold harmless American, its Affiliates, any Purchasers and Third Party Purchasers (collectively, the “Indemnified Parties”) from any and all claims of infringement or misappropriation and attendant damages and costs by virtue of the exercise of the rights granted to an Indemnified Party hereunder or under any Purchase Order. To secure the indemnity provided for in this Section 7.2, the Indemnified Party shall: (i) provide notice to Licensor of the claim giving rise to the liability as soon as reasonably practicable after receiving a notice of the claim, it being agreed that any delay in providing such notice to Licensor shall not relieve Licensor of its indemnity obligations except to the extent it was prejudiced by such delay; and (ii) use reasonable business efforts to cooperate fully with Licensor in defending the claim; provided, however, that Licensor shall not enter into any settlement or compromise creating any payment obligation, admission or other obligation on the part of any Indemnified Party without such Indemnified Party’s prior written consent. The Indemnified Parties shall permit Licensor to defend and compromise such claim, but each Indemnified Party may employ its own counsel, at its own expense, to assist Licensor with respect to any such claim. Notwithstanding the foregoing, the Indemnified Parties shall not be entitled to indemnification hereunder if the infringement is due to the Indemnified Party or its Affiliates: (i) using the System in violation of the express written operating instructions that are provided by AK if the subject claim would have been avoided but for such unauthorized use; or (ii) modifying the System in a manner which is not authorized by Licensor which actually causes such infringement if the subject claim would have been avoided but for such modification.

Section 7.3 Use of Designations. If requested by Licensor in writing, American shall, in accordance with the written instructions of Licensor, provide for any System or any part of the Technology, legible statutory notice of any Patent, the existence of the license herein granted and the identity of Licensor and/or AK. Notwithstanding anything contained herein to the contrary, no rights are being granted by either Party to the other regarding their respective trade names or trademarks.

Section 7.4 Limitation of Liability. The Parties expressly waive any claims against each other and their respective Affiliates for indirect, special, non-compensatory, incidental, punitive, exemplary or consequential damages of any type, whether arising in contract or tort (including negligence, whether sole, joint or concurrent or strict liability), arising out of or relating to this Agreement or a breach hereof; provided, however, that this provision shall not waive any claims that the Parties may have under any other agreements entered into between the Parties. The limitations on liability and the remedies set forth in this Agreement have been expressly bargained for by the Parties and reflect the knowing allocation of the risks inherent in this Agreement between the Parties.

Execution Copy

 11

ARTICLE 8 – REPRESENTATIONS AND WARRANTIES

Section 8.1 Party Representations. As of the Effective Date, each Party represents and warrants to the other Party that:

     (a) It is duly organized and validly existing and, where applicable, is in good standing under the laws of the jurisdiction of its formation and it has all requisite power and authority to enter into and perform its obligations under this Agreement;

     (b) The execution, delivery and performance of this Agreement have been authorized and approved by its Board of Directors or Managers, as the case may be, and do not and will not (i) violate any law, rule, regulation, order, decree or permit which is applicable to it or (ii) violate its organizational documents or any agreement to which it is a party;

     (c) This Agreement is a legal and binding obligation of such Party, enforceable against such Party in accordance with its terms, except to the extent enforceability is modified by bankruptcy, reorganization and other similar laws affecting the rights of creditors generally and by general principles of equity; and

     (d) There is no litigation pending or, to the best of its knowledge, threatened to which such Party, its parent or any of its subsidiaries is a party that, if adversely determined, would have a material adverse effect on the financial condition, prospects or business of such Party or its ability to perform its obligations under this Agreement.

Section 8.2 Licensor Representations Regarding the Technology. As of the Effective Date, Licensor represents and warrants to American, its Affiliates and each Purchaser and Third Party Purchaser that:

     (a) A list of all relevant Patents as of the Effective Date is set forth in Exhibit 3 attached hereto and all such Patents are current and valid as of the Effective Date with any and all required fees to maintain the same having been paid;

     (b) Licensor has licensed or otherwise has or otherwise will secure the rights in and to the existing and future Technology, including Intellectual Property, necessary for Licensor to grant to American the rights being granted in this Agreement, and there are no rights, options or other contractual obligations on the part of AK, Dr. Christian Koch of any other Person that would result in such Technology, including Intellectual Property, no longer being owned by or licensed to AK or licensed by Licensor, and AK shall maintain, prosecute and defend (or cause any other Person that owns any Patents to maintain, prosecute and defend) all Patents and pay all fees in connection therewith;

Execution Copy

12

     (c) The Technology, including Intellectual Property, does not use or include or rely on any third party intellectual property and no third party owns any rights, including intellectual property rights, necessary to American’s exercise of any of its rights under this Agreement that have not been licensed to AK;

     (d) Except for any rights granted to Covanta or Global, no rights have been provided to, or authorized for, any Person to exercise any rights in, the Technology, including the Intellectual Property, which are inconsistent with the rights granted to American hereunder;

     (e) The Technology as currently used by AK and as planned to be used by Licensor and American in accordance with the terms of this Agreement, does not infringe, misappropriate or otherwise violate any patent, copyright, trademark, trade secret or other proprietary or intellectual property right of any Person, and AK and/or Licensor have not received, and to its knowledge does not know of any facts that could give rise to, any charge, complaint, claim, demand, notice or other communication (i) alleging any such infringement, misappropriation or other violation, (ii) requesting that AK and/or Licensor take a license from any Person or (iii) challenging the validity or enforceability of the Intellectual Property. AK and/or Licensor has no knowledge of any current or threatened infringement, misappropriation or other violation by any Person of the Intellectual Property, and AK and/or Licensor has not, and has no knowledge of any facts that would require that there be, sent or otherwise communicated to any Person any charge, complaint, claim, demand or notice asserting infringement, misappropriation or other violation of any of any such Intellectual Property; and

     (f) Licensor has provided American with a true and correct copy of the Rights Agreements and there has not been any amendment to the Rights Agreements since they were executed. Licensor shall provide American with a true and correct copy of any amendments made to the Rights Agreements during the term hereof and a copy of any additional agreements entered into by Licensor with AK or Dr. Christian Koch regarding the rights of Licensor with respect to the Technology. Licensor shall provide American with a copy of any default notice or any similar communications received by Licensor from AK during the term hereof and provide American with updates from time to time regarding the resolution of any such termination notice. Licensor shall not agree to or make any amendment to any of the Rights Agreements or enter into any other agreements regarding its rights to the Technology that would reduce or affect any of American’s rights under this Agreement.

ARTICLE 9 – RESOLUTION OF DISPUTES

Section 9.1 Dispute Resolution. The Parties agree to cooperate with each other in good faith to try to resolve any controversy or dispute between them arising under this Agreement (each a “Dispute”) in accordance with the following procedures:

     (a) If a Dispute cannot be resolved informally, such Dispute shall initially be referred, through written notice by one Party to the other Party, to a meeting of senior

Execution Copy

 13

management representatives of the Parties. The senior management representatives will meet to resolve the Dispute within fifteen (15) days following presentation of the matter to them.

     (b) If the Dispute cannot be resolved pursuant to Section 9.1(a), the Chief Executive Officers of the Parties shall meet to resolve the Dispute within fifteen (15) days following the conclusion of the consideration of the Dispute under Section 9.1(a) .

     (c) If the matter is not resolved within thirty (30) days of the written notice in Section 9.1(a), either Party may submit the Dispute to arbitration by submitting a Request for Arbitration pursuant to Article 4 of the Rules of Arbitration of the ICC or such equivalent arbitration rules of the ICC then in effect (the “ICC Rules”), provided that nothing in this Agreement shall prevent or delay either Party from applying for interim or conservatory measures pursuant to Article 23 of the ICC Rules.

Section 9.2 Arbitration of Unresolved Disputes.

     (a) All Disputes arising out of or in connection with this Agreement that are not resolved in accordance with the provisions of Section 9.1 shall be finally settled under the ICC Rules by binding arbitration conducted in the English language and held in London, England before a panel of three (3) arbitrators. Notwithstanding anything to the contrary in the ICC Rules, the following procedures shall apply for the appointment of the three (3) arbitrators. Each Party shall appoint one (1) arbitrator, obtain its appointee’s acceptance of such appointment and deliver written notification of such appointment and acceptance to the other Party within thirty (30) days from the date that the Dispute was submitted to arbitration. If a Party fails to deliver written notification of its appointment of an arbitrator and his/her acceptance within the time period provided in this Section 9.2, then such arbitrator shall be appointed by the ICC in accordance with the ICC Rules and be deemed a Party-appointed arbitrator for all purposes hereof. The first two arbitrators so selected shall select the third arbitrator (who shall act as chairman of the arbitration proceedings), prior to the thirtieth (30^th) day following the appointment of the second Party-appointed arbitrator. If the Party-appointed arbitrators are unable to select a neutral arbitrator, they shall jointly submit a list of four names (two each) to the ICC, which shall select the third arbitrator from the list submitted to it.

     (b) No arbitrator shall be a past or present employee or agent of, or consultant or counsel to, a Party or any Affiliate of a Party, unless such restriction has been waived in writing by the other Party to the proceeding.

     (c) The substantive law governing the Dispute shall be the laws of the State of New York.

     (d) The arbitrators shall have the sole power and authority to determine the arbitrability of any Dispute arising under or relating to this Agreement or the subject matter hereof. Subject to any other relevant limitations set forth elsewhere herein, the arbitrators will have the power to award any type of relief that is just and appropriate in

Execution Copy

14

the arbitrators’ discretion, including compensatory damages, injunctive orders, orders for specific performances and declarations of rights.

     (e) The arbitrators shall not have power, however, to award punitive, consequential, exemplary or treble damages or any other type of relief in the nature of a penalty, and the Parties hereby expressly waive any right they might otherwise have to such relief. THE PARTIES HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY WITH RESPECT TO ANY DISPUTE ARISING OUT OF OR RELATING TO THIS AGREEMENT.

Section 9.3 Finality; Enforcement. Any decision or award of a majority of an arbitral panel, as applicable, shall be final and binding upon the Parties. Each Party agrees that the arbitral award may be enforced against it or its assets wherever they may be found and that a judgment upon the arbitral award may be entered in any court having jurisdiction thereof. The Parties hereby waive any right to appeal or to review of the decision or the award of an arbitral panel by any court or tribunal and also waive any objections to the enforcement of such decision or award.

Section 9.4 Costs. The costs of arbitration shall be paid in accordance with the decision of the arbitral panel pursuant to the ICC Rules.

Section 9.5 Continuing Performance Obligations. The existence of any Dispute or the pendency of the Dispute resolution procedures set forth herein will not relieve or excuse a Party from its ongoing duties and obligations under this Agreement, and the Parties shall nevertheless proceed with the performance of this Agreement in accordance with the terms hereof.

ARTICLE 10 – TERMINATION

Section 10.1 Termination Rights. This Agreement may be terminated by either Party in the case of the failure of the other Party to fulfill any of its material obligations hereunder (a “Default”) on ninety (90) days’ prior written notice to the Party in Default, such notice to specify the performance failure of such Party.

Section 10.2 Cure Rights. Notwithstanding anything contained herein to the contrary, a Party that is in Default shall be entitled to cure such Default by satisfying its performance obligation prior to the end of such ninety (90) day period. Furthermore, if such Party is diligently proceeding to cure such Default but such cure cannot be accomplished within such ninety (90) day period, the Party in Default shall be given up to an additional sixty (60) days to cure the Default so long as such Party continues to diligently pursue curing the Default. If the Default is cured by the Party that is in Default prior to the end of the cure period, then the notice of termination shall be null and void. If a Party fails to cure a Default, then this Agreement shall terminate on the date set forth in the notice of Default, but in no event prior to ninety (90) days following the issuance of such notice of Default.

Execution Copy

15

Section 10.3 Right to Retain the License. Notwithstanding anything contained herein to the contrary, if Licensor is in Default for a failure to perform any material obligation hereunder, American shall retain all the license rights and other rights granted to American hereunder, without any obligation to purchase any System through Licensor. In such case, American shall place all Purchase Orders through AK.

Section 10.4 Termination by Licensor. If Licensor terminates this Agreement based on a failure of American to fulfill any of its material obligations hereunder, American shall not be relieved of the limitations and restrictions imposed by this Agreement upon the use or dissemination of the Technology and/or the Systems which is not at such time in the public domain; and that for installed Systems, American shall retain all the license rights and other rights granted to American hereunder.

ARTICLE 11 – GENERAL PROVISIONS

Section 11.1 Expenses. Except as is otherwise expressly provided in this Agreement, each Party will bear its respective expenses incurred in connection with the preparation, execution and performance of this Agreement.

Section 11.2 Confidentiality. The Parties agree to maintain the confidentiality of this Agreement and the terms and conditions hereof. Any public announcements or similar publicity with respect to this Agreement shall be issued at such time and in such manner as the parties shall jointly determine. Notwithstanding the foregoing, each Party (and its Affiliates) shall have the right to make all such disclosures as required by applicable law or by any governmental body, including any stock exchange or securities market to whose regulations or disclosure requirements a Party is subject, without the consent of the other Party hereto; provided, however, that in the event of any such required disclosure, the disclosing Party (and its Affiliates), to the extent reasonably practicable, shall provide the other Party with advance notice of any such disclosure and an opportunity to comment thereon. The parties acknowledge that it is their intent to limit, to the fullest extent possible, any publicity regarding their joint cooperation during the Interim Period, it being recognized, however, that American will need to contact public officials in connection with securing permits or other approvals for the Demonstration Plant. In such regard, American will undertake to obtain assurances of confidentiality from such public officials, but disclosures may nevertheless result.

Section 11.3 Notices. All notices, consents, waivers and other communications under this Agreement must be in writing and will be deemed to have been duly given when (i) delivered by hand (with written confirmation of receipt), (ii) sent by telecopier (with written confirmation of receipt), provided that a copy is mailed by registered mail, return receipt requested, or (iii) when received by the addressee, if sent by a nationally recognized overnight delivery service (receipt requested), in each case to the appropriate addresses and telecopier numbers set forth below (or to such other addresses and telecopier numbers as a party may designate by notice to the other parties):

Execution Copy

16

Licensor:

AlphaKat Global Energy GmbH
Schulstrasse 8
96155 Buttenheim, Germany
Attention: Chief Executive Officer
Facsimile: +49-9545-950325

American:

945 Ellington Lane
Pasadena, CA 91105, USA
Attention: Bruce I. Drucker
Facsimile: +1-815-361-9052

Section 11.4 Waiver. Neither the failure nor any delay by either Party in exercising any right, power or privilege under this Agreement shall operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power or privilege will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege. To the maximum extent permitted by applicable law, (i) no claim or right arising out of this Agreement can be discharged by one Party, in whole or in part, by a waiver or renunciation of the claim or right unless in a writing signed by the other Party, (ii) no waiver that may be given by a Party will be applicable except in the specific instance for which it is given and (iii) no notice to or demand on one Party will be deemed to be a waiver of any obligation of such Party or of the right of the Party giving such notice or demand to take further action without notice or demand as provided in this Agreement.

Section 11.5 Entire Agreement and Modification. This Agreement supersedes all prior agreements between the Parties with respect to its subject matter and constitutes a complete and exclusive statement of the terms of the agreement between the Parties with respect to its subject matter. This Agreement may not be amended except by a written agreement executed by the Party to be charged with the amendment.

Section 11.6 Assignment. Neither Party may assign its rights under this Agreement, in whole or in part, without the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed, except that each Party may make an assignment of this Agreement to an Affiliate (so long as such Party remains liable for its obligations hereunder following such assignment) and each Party may make a collateral assignment of its rights hereunder to one or more lender(s) in connection with the financing being arranged by such Party. In the case of a collateral assignment by one Party to one or more lenders, the other Party shall, if requested to so, negotiate the terms of a consent to assignment in good faith and enter into such consent without delay. Notwithstanding the foregoing, Licensor may withhold its consent in the case of a proposed assignment to any Person that is a Competitor of Licensor.

Execution Copy

17

Section 11.7 Severability. If any provision of this Agreement is held to be invalid, illegal or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of this Agreement held invalid, illegal or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid, illegal or unenforceable.

Section 11.8 Governing Law. This Agreement will be governed by, and construed in accordance with the laws of, the State of New York without regard to its conflicts of law (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law).

Section 11.9 No Power of Representation. Neither Party shall have the authority or right under this Agreement to, nor shall either Party hold itself out as having the authority or right under this Agreement to, (i) assume, create or undertake any obligation of any kind whatsoever, express or implied, on behalf of or in the name of the other Party without the express prior written consent of such other Party or (ii) accept service of any legal process addressed to or intended for such other Party.

Section 11.10 No Partnership. Nothing in this Agreement shall be construed as creating a partnership, association, joint venture or any other legal entity between the Parties (including their Affiliates), nor a fiduciary relationship between the Parties (including their Affiliates).

Section 11.11 No Third Party Beneficiaries. No provision of this Agreement is intended or is to be construed to confer upon any Person, other than the Parties and their respective Affiliates and successors and permitted assigns, any rights or remedies under or by reason of this Agreement, except for all Purchasers and Third Party Purchasers to the extent provided for in Section 2.5.

Section 11.12 Counterparts and Facsimile Signatures. This Agreement, and any other agreement, instrument, certificate of other documents desirable to be executed and delivered in order to consummate the Contemplated Transactions, may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. Any such document may be executed by facsimile signature. The signatures below of American and Licensor also serve to state their agreement and position as parties to the “Acknowledgement and Agreement” which is being signed below by Dr. Christian Koch and AK.

[Signature page follows]

Execution Copy

18

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

ALPHAKAT - GLOBAL ENERGY GMBH
By:	/s/ Yossi Raz
	Yossi Raz, Chief Executive Officer
	Date: February 6, 2008
	AMERICAN RENEWABLE
	DIESEL, LLC
By:	/s/ Bruce I. Drucker
	Bruce I. Drucker, Chief Executive Officer
	Date: February 6, 2008

Acknowledgment and Agreement:

Dr. Christian Koch, in his capacity as President of AK and his individual capacity hereby, as signed below, acknowledges he has reviewed this License Agreement in its entirety and agrees to all of the terms hereof and confirms that the representations and warranties that are made in Section 8.2 are true and correct.

AK owns or has sufficient rights, and has granted Licensor sufficient rights, to allow Covanta to exercise the rights granted under the License Agreement. If for any reason the rights granted to Covanta by Licensor are not sufficient to allow Covanta to exercise its rights under the License Agreement, Dr. Christian Koch or AK shall convey or cause to be conveyed any and all further rights needed by AK or Licensor to permit Covanta to exercise such rights under the License Agreement. If the rights granted or to be granted to Licensor are terminated for any reason or if Licensor ceases to exist, AK shall enter into a substantially similar form of license agreement with American, such new license agreement to preserve the Full Rights and/or the Qualified Rights granted to American in the Territory. Dr. Christian Koch agrees that he will cause AK to perform its obligations hereunder.

All capitalized terms herein have the meanings given in the License Agreement.

By: /s/ Dr. Christian Koch
       Dr. Christian Koch
       Date: February 6, 2008

Execution Copy

19

EXHIBIT 1 – COVANTA LICENSE AGREEMENT

[filed as Exhibit 10.25 to this Form 10-K]

Execution Copy

20

EXHIBIT 2 – RIGHTS AGREEMENTS

Terms of Agreement dated May 2, 2007
Shareholders’ Agreement dated July 10, 2007
Articles of Association of Licensee dated November 14, 2007 and November 22, 2007

Execution Copy

 21

May 2, 2007

Terms of agreement between:

Global Energy Inc (GE) public company on NASDAQ OTCBB,

With offices in Israel at

Migdal Aviv 35 floor

7 Abba Hillel St., Ramat Gan, Israel

And

ALPHAKAT GMBH (AK)

Schlstrasse 8

D-96155 Buttenheim, Germany

1.	ALPHAKAT GMBH (AK) Technology	AK and its principle Dr. Christian Koch developed owned and registered patents for technology to convert different types of Municipal solid Waste (MSW), organic materials, refinery sludge etc. into mineral diesel oil. The technology incorporates KDV plant and low temperature vacuum process including special patented catalyst and high speed turbine to distillate organics into diesel, all together the "technology" KDV500 has turbine of 2X200 KW, KDV5000 has turbine of 2X2000 KW
2.	AK demonstration plants	AK has built five plants to demonstrate its technology in the following countries: Mexico, Canada, Spain, Bulgaria and Italy. The plants KDV500 in Spain, Canada and Bulgaria are in a phase of final commission, GE has started due diligence and visited the KDV500 in Bulgaria, GE also discussed with the principals of the Canadian operation to learn more about the KDV500 in the state of Toronto town Berrie, Canada.
3.	GE and AK cooperation	Both companies GE and AK are looking to find a framework to cooperate in developing the technology, the potential market, and establish long term relationship to bring the technology to its utmost potential.
4.	GE contributions	GE can assist AK in the following fields:           a      Financial support.           b.    Assistance in corporate management, sales and after sales support. This will achieve by new joint marketing and                  Sales Company (M&S) as defined below.           c. Organizer of engineering and plant erection world wide.           d. Manage of Joint Ventures in many countries to produce diesel by utilizing the technology.
5.	AK contributions	AK and its principle Dr. Christian Koch can emphasize its valuable time for:

		a. Continues R&D for perfection of the technology.           b. Continues study to reduce the cost of the KDV units.           c. Leading the R&D program for KDV 5000.           d. Support the team of building and erection of plants.           e. Support field ideas from the Joint Ventures to maximize the technology.
6.	Phase one: Marketing and Sales Company	AK and GE will establish a marketing and sales world wide marketing company with equal partnership. The M&S will have exclusive right to sell the technology and plants worldwide. No other company will receive such exclusive rights. AK will continue to sell the technology and plants with other and smaller turbine up to 200 KW and 350 KW directly to any person in the world. It is AK's option to give old or new contact for new plant to the joint M&S Company to continue the sales negotiations. AK already gave exclusive rights for sales to: Italy, Spain, Portugal, Bulgaria, Mexico and Canada, and in Mexico and Spain for cooperation in mounting plants.            º The end user of M&S Company will pay the cost of the plant directly to AK the price includes agreed fee of 10% to the joint M&S Company.           º GE will finance all the M&S Company activity in the world.           º GE will deal with all permits required for erecting and selling the diesel in these countries.           º GE will manage the company and will appoint the personnel to achieve the goals of sales and after sales maintenance for these plants.           º GE will build a finance program to support the end user worldwide and allow them to pay the plant costs to AK.           º AK will support all technical aspects of the company and the customers.           º AK and GE will agree of the company strategy and its annual plans.           º AK has the right to vote against a specific decision of a deal.           º The Joint Company will be the only company with such rights.           º The Joint Company will have the exclusive

		right to sell any KDV turbine larger than and 350 KW.
7.	Order of 3 KDV 500	GE intends to order 3 KDV500 for Poland, USA and Israel. GE intends to start the permitting process for these 3 KDV500 plant. The price of one KDV500 will be 2.5 million Euros if GE will order one unit and 2.4 if GE will order all 3 units together. Payment terms:           º 100,000 Euros for permitting process for all 3 units, AK and Dr. Koch will support the permitting and EIA process,              if the process will require more hourly work then GE will pay additional hourly rate of 100 Euros for Dr. Koch,              80 Euros for senior engineer and 60 Euros for technician.           º Second payment of 1.2 million Euros for ordering of 6 turbines.           º Third payment for each plant of 50% - 400K already paid for the 2 turbines payment when building permit received.           º Fourth payment of 40% at delivery to site.           º Fifth payment of 10% after commission.
8.	Monthly payment	GE directly or through the Joint Company will pay to Dr. Koch a salary of 10,000 Euro per month.
9.	Initial Payment	The monthly payment will start subject to: First payment of 10,000 Euro will be only after complete technical "Due Diligence (DD)" which will include: (i) laboratory test of sealed sample of diesel from KDV 500 and (ii) visit continues operation of KDV plants.
10.	Phase two	AK and GE want to establish long term cooperation and allow the parties to know each other and achieve mutual trust in the technology and the people involved in the two companies. GE will have the option to invest directly in AK. For the money invested by GE in AK, GE will get shares of the Company as defined below.           a. GE will pay the actual cost of the KDV2000 and AK will keep open books for that purpose GE will also be involved in this process.           b. All the above said investment will consider as full price and payment for the first KDV5000 that GE will order.           c. The investment for order of KDV5000 will be done by 3 equal installments every 6 months starting at the end of the DD period.           d. For the payment of the KDV5000 GE will get

		10% shares of AK.           e. AK will show all the information to representative of GE, and GE representative will assist AK as much as possible.           f. The phase two is limited to start this year 2007 with the first prepayment for ordering the necessary parts and payments of the first part of 2 million Euros, when the payment is not released this year the agreement about phase two is cancelled. AK acknowledges that GE is a public company and has to report to the Stock Exchange Commissioner (SEC) according to the law and AK will report accordingly. This investment will subject to full DD that will include:           i. Patent and intellectual properties.           ii. Auditing company's balance sheets for the previous three years, including all bank loans and other obligations.           iii. Full discloser of KDV 500 production           iv. Full discloser of shareholding and shareholding agreements with companies in the countries mentioned in section 2 above.           v. Full discloser of employee and subcontract agreements.            vi. Discloser of all company's registration, article of association, legal aspects, past law sues, etc.           vii. Board resolution. viii. Any other discloser that GE may request to comply with its obligation to SEC.           ix. The money will invest in the company according to agreed milestones of the R&D program and the need of agreed working capital.           x. AK will arrange in proper manner all the company's intellectual property, process; know how, drawings and engineering data. This option for second DD period will be up to eight (8) months after the first payment of first phase.
11.	DD period	GE will finalize its first DD period 30 days after the visit to an operational KDV 500 plant.
12.	Final agreement	Upon mutual decision of both sides after the DD period GE and AK will work to draft a final agreement for development of KDV5000 GE in AK. The final agreement will include but not limited to: New Articles of Association, new Board of Directors, mechanism to achieve decisions, appointing of general

		manager CEO, appointing of CFO, dispute resolutions, etc.
13.	First refusal	AK agrees that if AK wants to sell part of AK shares to third party it will give right of first refusal to GE.
14.	Termination of terms of agreement	the This agreement is canceled automatically if one of the parties does not fulfill the obligations.

By:	/s/ Dr. Christian Koch	By:	/s/ Mr. Asi Shalgi
	Name: Christian Koch		Name: Asi Shalgi
	Title: CEO ALPHAKAT GMBH		Title: CEO Global Energy

July 10, 2007

SHAREHOLDERS’ AGREEMENT

THIS AGREEMENT is effective as of July 10, 2007 by and among GLOBAL ENERGY INC., a company incorporated under the laws of the State of Nevada (“GEYI”), and ALPHAKAT GMBH, a company incorporated under the laws of the State of Germany (“AK”), (each: a “Party” and together: the “Parties”).

WHEREAS, the Parties have incorporated a company in (to be defined later) under the name of Alphakat - Global Energy Inc (the “Company”), with GEYI to initially hold 50% of the shares and AK to initially hold the remaining 50% of the Shares; and

WHEREAS, the Parties desire to cooperate in order to promote the business of the Company in accordance with the provisions set forth herein.

NOW, THEREFORE, in consideration of the undertakings and the mutual covenants of the Parties hereinafter set forth, it is agreed as follows:

1.	SHAREHOLDING IN THE COMPANY
	Each of the parties shall subscribe for the shares of the Company, in consideration for the shares’ par value, and the Company shall issue 50% of the Company's shares to GEYI, and 50% of the Company’s shares to AK (each such amount of the shareholding shall hereinafter be referred to as the “Shares”).
2.	MAIN PURPOSE
	The Company’s purpose will be the worldwide marketing and sales of the Technology and the products (as these terms are defined bellow), or any such other activities as the Company may at any time determine, and to engage in any other lawful act or activity (the “Company’s Business”).
	For the purpose of this Agreement, the term "Technology" shall mean: the technology of KDV to convert waste containing hydrocarbons into mineral diesel oil. And the term "Products" shall mean any products ensuing or resulting from the Technology including KDV turbines.
3.	PLACE OF BUSINESS
	The Company’s principal place of business shall be (TBD), unless determined otherwise by the Company’s Board of Directors.
4.	TRANSFER RESTRICTIONS
	4.1	No Party shall sell, assign, transfer, pledge, hypothecate, mortgage or dispose of, by gift or otherwise, or in any way encumber (any of the above, "Transfer"), all or any part of the Shares owned by it (or securities convertible or exercisable therefore), other than in compliance with the terms of this Agreement or other than to a Permitted Transferee. For the purposes of this Agreement, "Permitted Transferee" shall mean an entity which is wholly owned or controlled by the Party. A transfer to a Permitted Transferee is only permitted if (i) each such transferee agrees in writing on a form prescribed by the Company

	to be bound by all of the provisions of this Agreement and (ii) any Transfer in interests in a Permitted Transferee shall be subject to all the transfer restrictions in this section and otherwise contained in this Agreement (section 5, 6 and 7) as if interests in such Permitted Transferee were shares in the Company.
4.2	In no event may either Party Transfer any of their Shares to any person, entity, business or venture that competes with the Company's Business.
4.3	Notwithstanding the foregoing, neither Party may Transfer any of its Shares during the first five (5) years following incorporation of the Company.

5.	RIGHT OF FIRST OFFER (THE "RIGHT")
	5.1	If at any time either Party (the "Offeror") wishes to Transfer any or all of the Shares owned by him/it to a third party (the "Offered Shares"), then prior to soliciting an offer from, or making any such offer to, a third party, the Offeror shall first submit a written offer containing all material terms to the other Party (the "Offer") in respect of the Offered Shares.
	5.2	Within sixty (60) days after receipt of the Offer, the other Party shall have the right to give notice to the Offeror of its intent to purchase all (but not less than all) of the Offered Shares on the same terms and conditions as set forth in the Offer. Once delivered, such notice, taken in conjunction with the Offer, shall be deemed to constitute a valid, legally binding and enforceable agreement for the sale and purchase of such Offered Shares to the other Party, and the sale of the Offered Shares to the other Party shall occur within sixty (60) days of receipt of the Offeror's written notice.
	5.3	Should written notice not be received by the Offeror within the sixty day time period referenced above, or if the other Party shall give notice of its election not to acquire such Offered Shares, then the Offer will be deemed to have lapsed, and the Offeror may, for a period of up to ninety (90) days thereafter, offer the Offered Shares to a bona fide third party on terms and conditions, including price, not more favorable to the proposed buyer than those contained in the Offer to the other Party.
	5.4	Any Shares not sold to a bona fide third party within the 90-day period referred to in Section 5.3 shall again be subject to the requirements of this Section 5.
	5.5	In the event that Shares are sold to pursuant to this Section 5, said Shares shall continue to subject to the restrictions imposed by Sections 4, 5, 6 and 7 of this Agreement, and the purchaser of said Shares shall agree in writing to abide by such Sections.
6.	TAG ALONG
	6.1	In the event that either Party (the "Initiating Party") wishes to Transfer any shares of the Company held by it to a third party, the Initiating Party shall notify the other Party in writing, and the other Party shall have the right to require, as a condition to such Transfer, that the proposed transferee purchase from him/it upon the same terms, that number of shares which constitutes the same portion of the total number of shares held by him/it as the number of shares proposed to be sold by the Initiating Party (the "Co- Sale Shares").

2

6.2	The other Shareholder shall have the option, exercisable by written notice to the Offereor, within thirty (30) days after receipt of the notice from the Offeror, to require participation in the sale as referenced in section 6.1 above.
6.3	In the event that the other Party exercises its tag along rights hereunder, the Initiating Party must cause the proposed transferee to add such shares to the shares to be purchased by the transferee, as part of the sale agreement to such a degree that all of the Co-Sale Shares are included.

7.	RESERVED
	8	ACKNOWLEDGMENT AND PRE-EMPETION RIGHTS
	8.1	The Parties acknowledge that their Shares may be diluted as a result of investments and other issuances of shares by the Company.
	8.2	If at any time prior to an IPO, the Company proposes to issue and sell New Securities, as defined below, the Parties agree that the Company shall enable the Parties to maintain their percentage ownership of the outstanding shares of the Company, as stated below:
	8.3	For the purpose of this Section 8, "New Securities" shall mean any capital stock of the Company, whether or not now authorized, and rights, options or warrants to purchase capital stock, and securities of any type whatsoever that are, or may become, convertible into capital stock; provided that the term "New Securities" shall not include (i) shares of the Company issuable upon exercise of outstanding options or warrants; (ii) securities issued pursuant to the acquisition of another corporation by the Company by merger, purchase of substantially all the assets of another corporation or any other reorganization; (iii) securities issued to employees, officers, directors and consultants of the Company pursuant to any stock option plan or stock purchases or stock bonus arrangement; (iv) securities issued pursuant to payment of any dividend or distribution with respect to all of the Company's issued and outstanding shares; and (v) securities issued to a strategic investor approved as such by the Board of Directors.
	8.4	If the Company proposes to issue New Securities, it shall give the Parties written notice (the "Rights Notice") of its intention, describing the New Securities, the price, the general terms upon which the Company proposes to issue them and the number of shares that each Party has the right to purchase under this Section 8. Each Party shall have fourteen (14) days from delivery of the Rights Notice to agree to purchase all or any part of its pro-rata share of such New Securities for the price and upon the general terms specified in the Rights Notice, by giving written notice to the Company setting forth the quantity of New Securities to be purchased. The Party's pro rata share shall be the ratio of the number of shares of the Company's Ordinary Shares then held by such Party of the date of the Rights Notice, to the sum of the total number of Ordinary Shares as of such date .
	8.5	If the Parties fail to accept such offer as to all or part of the New Securities, the Company shall have the right within one hundred and twenty (120) days thereafter to sell or enter into an agreement to sell, the New Securities as to which such offer, or offers, were not accepted; provided, however, that no such sale shall be effected at a price or upon terms more favorable to the purchasers thereof than those specified. In the event the Company has not sold or entered into an agreement to sell such New Securities within such 120-day period, the Company shall not thereafter issue or sell such New Securities without first complying with the procedure set forth in this Section 8.

3

9 TERMINATION OF RIGHTS

9.1 The rights contained in Sections 4, 5, 6, 7, 8 and 11 shall terminate and be of no further force or effect (i) immediately upon the consummation of the IPO or (ii) when the Company first becomes subject to the periodic reporting requirements of Section 12(g) or 15(d) of the U.S. Securities Exchange Act of 1934, as amended, or the reporting requirements of a similar reporting regime of another jurisdiction, whichever event occurs first.

10 BOARD OF DIRECTORS

10.1	So long as each Party owns 50% of the outstanding shares of the Company, then each Party shall be entitled to appoint an equal number of directors to the board of directors of the Company. In the event that either Party holds, at any time in the future, a majority of the number of outstanding Shares, then such Party will have the right to appoint a majority of the directors of the board of directors of the Company.
10.2	Initially, the directors appointed by GEYI shall be Mr. Asi Shalgi and Mr. Yossi Raz and the directors appointed by AK shall initially be Dr. Christian Koch and Mr. Ludwig Christian Koch.
10.3	Neither Party shall be able to assign or transfer its/his right to designate a director to any other third party.
10.4	Within 60 Days from the Effective Date of this Agreement, the board of directors shall agree on the Company's marketing and sales strategy, annual business plan, and goals.

11 MANAGEMENT OF THE COMPANY

11.1	GEYI shall appoint Mr. Yossi Raz as the Company's Chief Executive Officer ("CEO"') in accordance with the terms of an Employment Agreement attached hereto at Appendix A (the "Employment Agreement") between Mr. Yossi Raz and the Company as set out at Appendix A. Any subsequent CEO shall be appointed by GEYI.
11.2	AK shall initially appoint Dr. Christian Koch as the Company's Chairman. The Company's Chairman shall not have a casting vote. Any subsequent Chairman shall be appointed by AK.
11.3	AK shall have the right object to any sale of Product promoted or intended by the Company, in which case the Company shall not perform such sale and/or cease the promotion of such sale as applicable
11.4	The Company's CEO and Chairman shall be responsible for the day to day management of the Company, and the implementation of the Company's marketing and sales strategy and business plan, and for meeting the Company's goals.
11.5	Notwithstanding any action or resolution regarding any of the following issues, is to be approved by the Company’s board of directors:

4

.i any action that authorizes, creates or issues shares of any class.

.ii any action that reclassifies any outstanding shares into shares having preferences or priority as to dividends or assets senior to or on a parity with the Ordinary Shares; .

iii any merger or consolidation of the Company with or into one or more other corporations;

.iv the sale, lease, or other disposition of a material asset or the sale of all or substantially all of the Company’s assets;

.v any change in the rights relating to the composition or in the right to appoint members to the Board of Directors;

.vi any transactions between the Company and any Interested Party; an “Interested Party” shall mean a director, officer, employee, or significant shareholder or any family member of or consultant to any such person, corporation or other entity of which any such person beneficially owns ten percent (10%) or more of the equity interests or has ten percent (10%) or more of the voting power, other than transactions in the ordinary course of business.

.vii the terms and conditions of any initial public offering of the Company;

.viii the liquidation or dissolution of the Company;

.ix incur any indebtedness, make any capital expenditures, lend, enter into any material contract or commitment, incur any pledge or lien on the assets of the Company, other than as required in the ordinary course of business, but in no event in excess in the aggregate of US$ 5,000;

.x amendment of the Articles of Association of the Company; and

.xi the Company's signatory rights.

12 REMOVAL OF BOARD MEMBERS

12.1

Each Party agrees to vote in whatever manner as shall be necessary to ensure that (i) no director elected by either Party is removed from office, other than for cause, unless such removal is approved by the Party which so appointed that director and (ii) any vacancies created by the resignation, removal or death of a director shall be filled by the Party that appointed such director pursuant to the provisions of this agreement.

12.2

All Parties agree to execute any written consents required to effectuate the obligations of this Agreement.

13 EXPENSES AND FINANCING

13.1	The Parties agree that GEYI will lend to the Company such amounts as the Parties may agree, and in any event in accordance with a budget to be approved by the board of directors of the Company. The terms of such loan, including interest on such loan, will be agreed upon between the Parties.
13.2	All such payments as referenced in section 13.2 above shall be made for costs and expenses set forth in a budget approved by the board of directors of the Company from time to time.

5

14 EXCLUSIVITY

AK and the Company have the rights to market and distributor the Technology based on the KDV500, as define in the agreement dated May 2 2007.

14.1.1 AK herby appoints the Company as its sole agent exclusive for USA and China market, AK will not directly market to these markets but through the Company.

14.1.2 When GEYI will invest in the technology of Turbine 2000 than the Turbine 2000 technology will be marketing only through out the Company

14.1.3. The parties acknowledge that AK has already granted some third parties the right to sale the Technology and Products in certain territories as detailed in agreement signed May 2, 2007 ("Third Party Rights").

14.1.4 All sales transactions shall be made directly between AK and the purchaser. The sale price of any transaction shall include a fee of 10% which shall be paid by AK to the Company. The company has the right to offer higher prices as the market will accept in such case the Company will benefit from the full difference between the purchase price and the sale price. AK and the Company will coordinate prices.

15. DERTAKINGS OF THE PARTIES

15.1 AK shall provide all required technical assistance and support to the Company and any potential end users and purchasers of the Technology and the Products, in order to help the promotion of the Technology and the Products and the procurement of purchases.

15.2 GEYI will build a finance program to support end users in the procurement of the Products from AK, however, GA shall only offer such finance program to suitable end users at its sole and absolute discretion.

15.3 GEYI shall be responsible for obtaining necessary approvals and permits for the sale of diesel produced by the use ofthe Products and the Technology, were it finds it to be reasonable at its sole and absolute discretion.

16 REPRESENTATIONS AND WARRANTIES OF THE PARTIES

16.1	Each of the Parties hereby represents and warrants with respect to itself/himself the following:
	(i) Authority and Validity. Such Party has full power and authority to enter into, execute and deliver this Agreement and perform its/his obligations under this Agreement in accordance with its terms.

6

(ii) Absence of Conflicts. The execution and delivery of this Agreement by it and the consummation of the transactions as contemplated hereunder (i) do not and will not violate or conflict with any statute, regulation, judgment, order, writ, decree, or injunction currently applicable to it/him; and (ii) do not and will not violate or conflict with any existing mortgage, indenture, contract, licensing agreement, financing statement, or other agreement binding on it.

(iii) Consents and Contractual Restrictions. No consents or approvals of any third party are required in connection with the execution and delivery of this Agreement or the performance of the transactions contemplated hereunder otherwise. No agreement or arrangement binding upon such Party restricts its ability to fulfill its obligations and responsibilities under this Agreement or any related agreement or to carry out the activities contemplated herein.

(iv) Investment Representations. Each Party is acquiring the Shares for its/his or her own account.

16.2 AK further represents and warrants that:

(i) it has all valid legal rights to the Technology and the Products;

(ii) it has the right to grant to GEYI all rights contained in this Agreement, including the Exclusivity set forth in section 14 above; and

(iii) the provisions of this agreement and any of AK's undertakings hereunder does not infringe upon the intellectual property rights of any third parties.

Each Party undertakes to inform the other Party immediately upon any material change in the above representations and warranties.

17. ASSISTANCE TO THE COMPANY

The Parties shall use their best efforts to actively assist and promote the interests of the Company.

18. MISCELLANEOUS

18.1 ENTIRE AGREEMENT.

This Agreement represents the entire agreement between the Parties.

18.3 ASSIGNMENT.

No part of this agreement may be assigned by any of the Parties hereto without the consent of all of the Parties hereto.

18.4 GOVERNING LAW AND JURISDICTION.

This Agreement shall be governed by and construed under the laws of the Republic of Germany. The competent courts in Gerrmany, shall have exclusive jurisdiction over any

 7

dispute arising in connection with this Agreement.

18.5           HEADINGS.
Headings in this Agreement are for convenience only and shall not be used to interpret or construe its provisions.

18.6           NOTICES.
All notices or other documents under this Agreement shall be in writing and delivered personally or mailed, addressed to the Parties.

18.7           BINDING EFFECT.
The provisions of this agreement shall be binding upon and inure to the benefit of each of the Parties and their respective successors and assigns. The provisions of this Agreement shall supersede any conflicting provisions of the Articles of Associations of the Company with respect to the relationship between the Parties. The Parties agree to amend the Company's Articles of Association within the next thirty (30) days to the extent any terms of this Agreement so conflict or to the extent they otherwise deem it necessary to conform the Articles with the terms and condition set forth in this Agreement.

18.8           AMENDMENT.
This Agreement may be amended or modified only by written agreement between the Parties.

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

GLOBAL ENERGY INC.	ALPHAKAT GMBH
By:	By:
Name:	Name:
Title:	Title:

8

APPENDIX A

9

Record book number R1650 /2007 Re

Establishment of
Limited Liability Company

Today, the fourteenth and twenty-second day of November two thousand and seven,
- 14 and 22 November 2007 -,
the following appeared before me,
Martin Reiß,
Notary in Forchheim/Ofr., in the office at Nürnberger Street 8:

1)Dr. Christian Koch, born on July 04, 1940,
of 96155 Buttenheim, Schul Street 8,
acting herein as manager of

Alphakat GmbH
a company whose registered place of business is in Buttenheim
(business address: 96155 Buttenheim, Schul Street 8)

with the authority of single representation and exempted from the limitations of Section 181 of the Civil Code, regarding which, after perusal of the Electronic Trade Register at the Bamberg District Court made on November 14th 2007, I confirm that the above company is registered therein under HRB 5308 and Dr. Christian Koch is on record as manager with the authority of single representation and is exempted from the limitations of Section 181 of the Civil Code,

2.Mr. Joseph, known as Yossi, Raz, born on January 1, 1947, of 12 Nurit Str. , Haifa Isreal 34654 acting for

Global Energy Inc.

a company limited by shares incorporated under the laws of Nevada/USA, registered at the Secretary of State of Nevada, Corp Number C3690-1999, with office at 7 Zabotinski Str., Aviv-Tower, Floor 38, 52520 Ramat Gan, Israel,

subject to the consent of the aforesaid corporation which has to be certified by a notary public.

The parties identified themselves by official identity documents with pictures.

Mr. Yossi Raz, according to his own statement and the notary’s conviction, has insufficient knowledge of the German language, but knows sufficient English. At the time of certification the notary translated the document and the questions asked into English. All parties waived the services of an interpreter. As appendix 2 there is an English translation that has been made by the party and controlled by the notary. The annex also was made part of the notarial act. If there are differences between the German and the English text the German text shall prevale.

The reading of this deed was started on Nov. 14th, but interrupted as Mr. Raz had to leave, and resumed at the point, where it had been interrupted on Nov. 22nd and finished and signed by the parties on this day.

Upon the parties’ request I hereby certify the following:

I. Establishment

The parties mentioned in the introduction establish a Private Limited Company whose registered place of business is in Buttenheim (business address: 96155 Buttenheim, Schul Street 8) under the name

Alphakat - Global Energy GmbH

The Articles of Association are set down in the Annex to this document. Refer-ence is made to the Annex. The shareholders are taking over the shares as provided in the Articles of Association.

II. Costs, Copies

2

The costs of application and registration in the Commercial Register will be borne by the company as well as the costs of this certification in accordance with the Articles of Association.

The shareholders, the company, the tax office and the Registry Court of jurisdiction will each be given notarized copies.

III. Power of Attorney

Each of the Notary’s employees and every party of the contract will be exempted from the legal limitations and will be given power of attorney, including legal successors, to complete or amend this document in order to correct objections made by the Registry Court.

The notary shall get and receive for the parties of the contract the notarized consent of the party not represented today.

References

The Notary has pointed out inter alia:

- that only after registration in the Commercial Register will the company be established and that, according to Section 11, 2 of the Limited Liability Companies Law, before the company is registered the person performing legal acts on behalf of the company will be personally liable.

-that all shareholders and directors are in principle responsible for the authenticity of the data stated when establishing the company;

-that at the time of registration of the company in the Trade Register, the value of the company’s assets may not be less than that of the share capital, and that every shareholder has the obligation to pay any difference, without any limitation, compared with the pledged investment, and that the Registry Court has the right to refuse registration of the company in the Trade Registry on the grounds of unpaid prior charges.

3

V. Shareholder Resolution

Waiving any formal and time regulations, a shareholder meeting is called and the following resolution adopted:

The first business manager appointed is Dr. Christian Koch. He always has the authority of single representation and is exempted from the limitations of Section 181 of the Civil Code (prohibition of acting as contracting party and of multiple representations).

Mr. Yossi Raz will be granted single signature (Prokura), as well as being exempted from the limitations of Section 181 of the Civil Code.

VI. Guarantees

Each of the parties guarantees, insofar as they are concerned,

-that the signing parties have full power and authority of representation, of signing this agreement, executing and performing it and fulfilling the obligations based hereon;

- that signature and execution of the agreement is not contrary to any obligations stipulated in the Articles of Association, the law, agreements or otherwise;

-that no consent whatsoever by any third party is required for the execution or signature of this agreement, and

-that each party is acting on its own account.

Alphakat GmbH, Buttenheim, moreover guarantees:

-that it is legally entitled to KDV Technology and the corresponding products;

4

-that it is entitled to grant the newly established enterprise all the rights agreed upon herein, including the exclusive marketing right according to the Articles of Association;

- that the stipulations agreed upon herein and execution thereof do not infringe upon the protected copyrights of any third party.

Should any practical change occur regarding the above guarantees, each party has the obligation to inform the other accordingly, without delay.

Together with the Annexes 1 and 2 read by the notary,
approved by the parties and signed

(this is still part of annex 2, the English translation):

5

Annex 1
to the document certified by Notary Reiss in Forchheim
dated November 14th and 22nd, 2007, Document no. R1650 /2007

Articles of Association

Article 1: Company’s Name and Registered Place of Business

1.            The company’s name is

Alphakat - Global Energy GmbH.

2.           The company’s registered place of business is Buttenheim, district of Bamberg.

Article 2: Purpose of the Enterprise

1.	The purpose of the company is the worldwide marketing and distribution of KDV Technology (un-pressurized catalytic lubrication) for transforming recycling and waste material containing hydrocarbons into diesel fuels, as well as of products connected to this technology, including KDV tur-bines.
2.	The company is entitled to perform any transaction which may directly or indirectly benefit the company’s purpose, in particular - acquiring other enterprises, being a partner therein or assuming their representation and management. The company is entitled to establish branches.

Article 3: Share Capital

1.	The company’s share capital amounts to € 25,000.
2.	The share capital is divided as follows:

Shareholder	Amount of Authorized Capital
Alphakat GmbH, Buttenheim	€ 12,500
Global Energy Inc., New York/Ramat Gan	€ 12,500

6

3.

The capital invested must be paid in cash and becomes fully payable immediately.

4.

No stipulations are agreed upon in the Articles of Association regarding capital increase or later contributions. Such measures can only be decided by amending the Articles of Association. Any measure that may modify the participation quotas by modifying the authorized capital, i.e. capital increases, conditional capital increase or the issue of convertible debentures and similar financial instruments may only be decided by a unanimous resolution of all shareholders present.

Article 4: Duration, Business Year

1.	The agreement is concluded for an undetermined period of time.
2.	The business year is the calendar year. The first business year begins upon registration in the Commercial Register and ends at the end of the calendar year in which the registration is made.
3.	Under the contracts law any transactions made from the time the company was established are considered to be made on account of the company.

Article 5: The Company’s Executive Organs

The company’s executive organs are the management (manager) and the shareholder meeting.

Article 6: Representation

1.	As long as the company has only one manager, he has the right to sole representation.
2.	If several managers are appointed, the company will be represented by two managers jointly or by one manager jointly with an authorized signatory (“Prokurist").

7

3.	By a resolution of the shareholders, the managers or one of them can be granted sole representation rights and/or exemption from the limitations of Section 181 of the Civil Code.
4.	The above stipulations apply also to the liquidators of the company.
5.	As long as both partners own each one half of the company, the partners, Alphakat GmbH, Buttenheim, and Global Energy Inc. have the right to appoint one manager or signatory each with the sole outside representation right on behalf of the company. The partner can freely decide whether to appoint a manager or a signatory (Prokurist). The other partner has the obligation to agree to the appointment insofar as there are no important reasons against the appointment of the intended person. Cancellation of such appointment against the wish of the partner entitled to decide is only possible on serious grounds. Upon conclusion of the manager/signatory’s legal office, the entitled partner may require the appointment of a new manager or signatory to be named by him.

Article 7: Business Management

1.	The managers must manage the company’s business carefully and conscientiously according to the stipulations of the law and the partnership agreement. They must respect instructions given as per the partners’ resolutions.
2.	Any measures beyond the regular business operation of the enterprise may only be performed by one of the managers based on a partners’ resolution. A partners’ resolution can set forth the measures requiring consent in detail.
3.	Subject to an extraordinary partners’ resolution and subject to stricter legal regulations, the following business management measures always require the consent of both partners:
	1.	Sale, letting, leasing or other transfer of all or a substantial part of the company’s assets;
	2.	Agreements of any kind between the company, its executive organs, its partners, persons closely connected to the executive organs or to the partners, or anyone else with at least 10% participation in the above mentioned entities.
	3.	Establishing and closing branches;
	4.	Liquidation of the company;

8

5.	Conclusion of a transaction of any kind outside the company’s normal business operations, at a value of more than € 5,000 per transaction.
6.	Establishment of signature power or general power of attorney
7.	Establishment of connections with corporations, conclusion of secret partnership agreements, of management agreements and other agreements which may give third parties the power to manage the company.

Article 8: Partners’ Assembly (Shareholder Meeting)

1.	Partners’ resolutions are adopted at partners’ assemblies if not otherwise stipulated by law or these Articles of Association.
2.	The partners’ assembly is convened by the managers, each manager being separately authorized to convene the assembly. Notice is given by registered letter giving the place, time and agenda, and mailed to the last address of the partner provided to the company. The time allowed for the notice, if there is no particular need for haste, is at least two weeks after mailing, not including the day of the assembly.
3.	The partners’ assembly constitutes a quorum if at least 70% (seventy percent) of the authorized share capital is represented. Otherwise, an additional assembly must be convened without delay respecting the time al-lowed for notice as per paragraph 2, which assembly will constitute a quorum regardless of the number of participants. This must be stipulated in the second notice.
4.	Partners’ resolutions, if not otherwise stipulated by law or the Articles of Association, will be adopted by a simple majority of votes. Abstention from voting will be considered a negative answer. Every € 50 of a business share grants one vote.
5.	Insofar as no other partners’ resolution was adopted, the partners’ assembly will take place at the company’s registered place of business. At the assembly the representation by executive organs or executive employees of the partners, the other partners or people obliged to maintain professional secrecy is permissible.
6.	The assembly will elect a chairman by a simple majority. The chairman will also take care that the resolutions are recorded in writing. Within a period of four weeks after the assembly he will send the partners a protocol of the assembly.

9

7.

The partners may deviate from the provisions regarding the partners’ assembly and its formalities if it is agreed by all partners. With the consent of all involved, resolutions can also be adopted by circular resolution, by phone, fax or electronically. In this case care must be taken that the text of the resolution be immediately documented in writing. If all partners take part in a deviating form of resolution, their consent is assumed if they do not immediately protest against this form of resolution.

8.

Except in cases of nullity, in particular when obligatory laws are broken - the partners may only protest against the resolution by submitting a claim in court within a period of two months from the date the resolution was adopted.

Article 9: Balance Sheet, Appropriation of Earnings

1.	Within three months after the end of the business year, the managers must prepare a balance sheet with a Profit and Loss Account for the previous year, while respecting legal provisions, and submit it to the partners’ assembly with the proposed appropriation of earnings. Insofar as legally permissible the period for this will be six months.
2.	The appropriation of earnings is subject to legal provisions. This means that in principle the partners’ assembly will decide about the appropriation and distribution of the earnings by resolution (Section 29 of the Limited Liability Companies Law in the version of the Balance Sheet Directives Law).
3.	Global Energy Inc. can demand that every quarter balance sheets are filed as required by the American SEC regulation to be filed with the Global Energy Inc. obligation for 10-Q.

Article 10: Disposal of Partnership Shares

1.	The disposal of a partnership share or parts thereof requires written permission by the company to be valid, which shall only be given by the management after all partners have given their consent.
2.	The above regulations apply also to the establishment of a beneficial interest in respect to the partnership shares as well as to pledging and assignment for security of partnership shares.

10

3. Every partner is obliged, if intending to sell, to inform the other partner in good time before beginning negotiations with third parties, and to accordingly submit a sales offer. He must leave the other partner a reflection time of at least one month. In case of sale, the other partner has the right of first refusal.

Article 11: Termination

1.	Each partner may terminate the partnership in the company by a notice of six months before the end of the business year, but not before December 31, 2010.
2.	In consequence of the termination - subject to the provisions of Paragraph 3 - the terminating partner shall leave the company after the end of the notice period and the company shall continue according to Articles 12 and 13.
3.	If the other partners join the termination by a partners’ resolution, the company will be in liquidation at the date of termination. The terminating party will take part in the liquidation.

Article 12: Confiscation of Partnership Share, Retirement

1.	The confiscation of business shares is permissible. It does not require the consent of the involved partner if:
	a)	insolvency proceedings are opened concerning his assets, or the opening is refused for lack of assets, or
	b)	his business share is taken in execution (by a third party);
	c)	there is significant cause. A significant cause is in particular when, due to the misconduct of a partner, the other partners cannot be required to continue their business relationship with him. No fault is necessary for this.
2.	Instead of confiscating the partnership share, the partners’ assembly may decide to transfer the business share to one or several partners or to a third party named by the partners’ assembly. In the partners’ resolution each co-partner may require that in the case of assignation, the share of the retiring partner shall be transferred in proportion to his share in the company (accrual). Should an exact proportional division not be possible, the shares shall be divided as closely as possible.
3.	If there is a right to confiscate, such confiscation or a partners’ resolution according to Paragraph 2 can only occur within six months from of the time the cause becomes

11

	known, but only as long as the cause for confiscation still exists. This includes the knowledge by one of the managers (regardless of the type of representation authority) of the company, insofar as the cause is not linked to the very person of this manager.
4.	The resolution concerning confiscation or retirement is adopted by the partnership assembly at which the partner to be dismissed has no right to vote.
5.	Confiscation or retirement are subject to remuneration. The remuneration will be payable by the buyer of the share, observing Section 30 of the Limited Liability Companies Law (forbidding that the share capital is being paid back by the company to the partner). The amount of remuneration will be determined according to the regulations et forth below.

Article 13: Remuneration for confiscated or assigned shares

1.	If business shares are confiscated or assigned in accordance with these Articles of Association, the entitled partner or his successors will be remunerated for it. For this purpose the management will immediately prepare a compensation balance sheet. In this balance sheet all assets and liabilities shall appear at their real value at the time of the partner’s retirement. The company’s goodwill - if permissible - is not to be taken into account. The retired partner will not participate in pending transactions.
2.	If the parties involved cannot reach an agreement as to the value, it will be determined by an expert. The expert will be appointed upon demand of one of the parties by the President of the Bayreuth Chamber of Industry and Commerce. The costs of the valuation will be borne by the retired party and the company in equal shares.
3.	The remuneration will be paid in five equal annual installments. The first installment is due for payment six months after the confiscation resolution or the date of retirement of the partner involved, and the following installments on the corresponding calendar day of the subsequent years. The outstanding installment will bear annual interest of 2% - two percent - over the basic interest rate as described in the Euro Introduction Law commencing with the confiscation resolution or the date of retirement. The interest will be calculated at current account bank rates and shall be due for payment together with the following installment.

12

4. The compensation can be pre-paid fully or partially, and partial pre-paid amounts will be deducted from the following installment due. No security may be demanded.

Article 14: Exclusivity/Prohibition of Competition

Alphakat GmbH, Buttenheim gives the right to sell world wide. No other company or person can get the same rights for the world-wide distribution.

Alphakat GmbH appoints the company to be the sole marketing agent for the United States of America and the Chinese market. Alphakat GmbH will not use any marketing channels on those markets except already established contacts.

The parties involved acknowledge that Alphakat GmbH, Buttenheim has already granted third parties the right to sell the Technology and products in various areas, as described in detail in the agreement dated May 02, 2007. Alphakat GmbH explicitly reserves the right, as long as those agreements are valid and in their material extent, to execute and fulfill those agreements with third parties on its own account. No compensation in that respect has been agreed upon.

The foregoing exclusive dealing requirements are valid as long the contract from May 2nd 2007 is valid (including amendments or following contracts).

By a partners’ resolution to which both partners must consent, the partners and managers may also regulate whether there are further prohibitions of competition, whether to give exemptions and whether the exemption occurs against remuneration or without remuneration.

Should one of the partners - for whatever reason - retire from the company, he has the obligation not to exploit business secrets of which he learned pursuant to the execution of this partnership agreement, either himself or by transfer to third parties at the expense of the company founded or on the account of the other partner.

Article 15: Additional Contributions to the Company

13

1.	All sales and similar transactions will be made directly between Alphakat GmbH, Buttenheim and the business partner. The sales price of each such transaction will include a 10% commission (not including Value Added Taxes as per law), which will be paid by Alphakat GmbH directly to the newly founded company. The company has the right to make higher price offers, as long as the market accepts them. In such case, the company would profit fully from the difference between the purchase price offered by it and the regular sales prices. Alphakat GmbH and the company will mutually coordinate their prices.
2.	Alphakat GmbH will grant all necessary technical assistance and support by the company to any end user and buyer of the Technology and products in order to support the marketing of the technology and the products during sales.
3.	Global Energy Inc. will establish a financial program in order to support the end user in the acquisition of Alphakat GmbH products. However Global Energy Inc. reserves the right to put such financial support only at the disposal of selected and adequate end users. Moreover Global Energy Inc. has the responsibility of providing the permits and tests necessary for the sale of the diesel oil produced by the use of the marketed products and technology. Global Energy Inc. is free to decide where they should do the marketing (i.e. also obtaining permits).

Article 17: Publications

The company’s publications will be made only in the Electronic Federal Journal (elektronischer Bundesanzeiger).

Article 18: Tax Clause

The executive organs of the company must respect the trading and tax law principles of orderly business management and shall maintain the care in business transactions that would be taken by an orderly and conscientious businessman.

The management shall in particular not be authorized to grant advantages to the partners or persons and companies close to them beyond the profit distribution resolution duly adopted, neither to violate the prohibition of additional or retroactive payments, nor to breach other acknowledged tax law principles which, when

14

disregarded, cause covert profit distribution. In case of non compliance, the amount of the imbalance shall be covered by the partner to whom the advantage was credited and the usual bank interests paid from the time the advantage was granted until the payment is settled. Transactions in breach of the above stipulations are void ab initio.

Insofar as the tax administration or tax courts recognize the payment received as income received by the partner concerned despite the above tax clause, without considering the repayment as negative income, the partner will only have to repay the advantage remaining after deducting the additional income tax payable by him plus the usual bank interest.

Article 19: General Instructions

1.

Insofar as not otherwise stipulated in this agreement, the German Law regarding Private Limited Companies (GmbH) shall prevail. The agreement is formulated according to the provisions of German Company Law and is subject to the jurisdiction of German courts.

2.

Should any of the provisions of this agreement be or become invalid or unenforceable, the other parts of the agreement shall remain valid nevertheless and shall be binding on the parties to the agreement. The partners undertake in such case to immediately and retroactively change the interpretation, whether completely or by replacing any invalid provision retroactively, so that it becomes as close as possible to the intended purpose.

Article 20: Cost

The costs of notarizing the partnership agreement, the publication, the application for registration and registration of the Company in the Trade Registry as well as the costs of consultancy services in respect of the establishment shall be borne by the Company up to an estimated amount of € 2,000; any establishment costs above that amount shall be borne by the partners. This applies without prejudice to the legal personal liability of the parties.

-End of Annex 2-

15

EXHIBIT 3 – LIST OF PATENTS

Document Number	Title	Country	Registration Date	Docket Number	File / Reference Number
ALP6004WO	High-power	WO	04/04/07	PCT/DE2007/0	PCT/DE2007/0
ALP7001BR	Diesel Oil out of	BR (Britain)	03/31/04	PIO400912-6	PIO400912-6
ALP7001CA	Diesel Oil out of …	CA (Canada)	07/15/04	2,474,523	2,474,523
ALP7001CN	Diesel Oil out of …	CN (China)	03/23/04	200410030270	200410030270
ALP7001IN	Diesel Oil out of …	IN (India)	08/02/04	747/CHE/2004	747/CHE/2004
ALP7001JP	Diesel Oil out of …	JP (Japan)	10/08/04	2004-295764	2004-295764
ALP7001MX	Diesel Oil out of …	MX (Mexico)	03/15/04	PA/A/2004/002	PA/A/2004/002
ALP7001RU	Diesel Oil out of …	RU (Russia)	03/30/04	2004109567	2004109567
ALP7001US	Diesel Oil out of …	US (US)	07/15/04	10/891971	10/891971
ALP7002BR	High-power	BR (Britain)	02/02/06	PIO601891-2	PIO601891-2
ALP7002CA	High-power	CA (Canada)	09/01/06	2558401	2558401
ALP7002CN	High-power	CN (China)	02/14/06	200610004445	200610004445
ALP7002IN	High-power	IN (India)	07/25/06	1290/CHE/200	1290/CHE/200
ALP7002JP	High-power	JP (Japan)	04/27/06	2006-123066	2006-123066
ALP7002MX	High-power	MX (Mexico)	04/07/06	PA/a/2006/003	PA/a/2006/003
ALP7002RU	High-power	RU (Russia)	04/19/06	2006113270	2006113270
ALP7002US	High-power	US (US)	08/23/06	11/2508760	11/2508760
ALP7004BR		BR (Britain)	04/10/07
ALP7004CN	High-power	CN (China)
ALP7004IN	High-power	IN (India)	11/20/07
ALP7004JP	High-power	JP (Japan)	11/19/07	2007-299152	2007-299152
ALP7004KR	High-power	KR (Korea)	11/20/07	10-2007-01186	10-2007-01186
ALP7004MX	High-power	MX (Mexico)	05/25/07	MX/a/2007/006	MX/a/2007/006
ALP7004RU	High-power	RU (Russia)	11/19/07

 22

EX-31.1

EXHIBIT 31.1

CERTIFICATION

I, Asi Shalgi, certify that:

1.	I have reviewed this Annual Report on Form 10-K of Global Energy Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

By:   /s/ Asi Shalgi      
        Asi Shalgi
        Chief Executive Officer and President

Date: March 31, 2008

EX-31.2

EXHIBIT 31.2

CERTIFICATION

I, Alex Werber, certify that:

1.	I have reviewed this Annual Report on Form 10-K of Global Energy Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:
	(c)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	(d)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

By:    /s/ Alex Werber                    
        Alex Werber
        Treasurer and Chief Financial Officer

Date: March 31, 2008

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Global Energy Inc. (the “Company”) on Form 10-K for the period ending December 31, 2007, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Asi Shalgi, Chief Executive Officer and President of the Company, and Alex Werber, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to our knowledge, that:

(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By: /s/ Asi Shalgi
        Asi Shalgi
        Chief Executive Officer and President

By: /s/ Alex Werber
        Alex Werber
        Treasurer and Chief Financial Officer

Date: March 31, 2008