Commitments And Contingencies

6 Months Ended

Jun. 30, 2011

Commitments And Contingencies

Commitments And Contingencies

9.       Commitments and Contingencies

We have entered into employment agreements, which provide severance benefits to several key employees.  Commitments under these agreements totaled approximately $2,139,000 at June 30, 2011.  Expense is not recognized until an employee is severed. 

We entered into a Bio-Synfining Master License Agreement on June 22, 2007 with Dynamic Fuels, LLC.  Under this license agreement, we at the request of the licensee must execute a Site License Agreement in favor of licensee for licensee's use of our Bio-Synfining™ Technology.  The form of the Site License Agreement is included in the agreement as Exhibit B.  The form of the Site License Agreement includes process guarantees if the plant fails to pass a performance test as defined in the Site License Agreement.  If the plant fails to meet the Process Guarantee during the Performance Test and such failure is due in whole or in part to the Process Design Package, then we and Dynamic Fuels shall mutually agree whether or not remedial measures are reasonably likely to cause the plant to satisfy the Process Guarantee.  The actual cost of the remedial measures will be reimbursed to licensee through application of any future royalties owed to us, not to exceed $9,800,000.  If the remedial measures are not effective, we shall pay to Dynamic Fuels an additional amount for liquidated damages in an amount not to exceed $9,800,000.   As of the date of this filing the Site License Agreement has not been executed by Dynamic Fuels and we cannot be certain the document that will be executed will have this same language and amounts.