STOCK PURCHASE AGREEMENT

Exhibit 10.1

EXECUTION COPY

This AGREEMENT (this “Agreement”) is entered into as of the 22nd day of December, 2008, by and between PETROALGAE INC., a Delaware corporation (“Seller,” or the “Company”), and VALENS U.S. SPV I, LLC, a Delaware limited liability company (“Purchaser”).

W I T N E S S E T H :

WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to purchase from Seller, 666,667 shares (the “Shares”) of common stock, par value $0.001 per share, of the Company (the “Common Stock”), upon the terms and subject to the conditions set forth herein.

NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants, agreements, undertakings and obligations set forth herein, and intending to be legally bound hereby, the parties hereto agree as follows:

ARTICLE 1

SALE AND PURCHASE OF THE SHARES

Section 1.1 Sale and Purchase of the Shares. Upon the terms and subject to the conditions set forth in this Agreement and on the basis of the representations, warranties, covenants, agreements, undertakings and obligations contained herein, at the Closing (as defined in Section 2.1 hereof), Seller hereby agrees to sell to Purchaser, and Purchaser hereby agrees to purchase from Seller, the Shares, free and clear of any and all Liens (as defined in Section 8.11 hereof), for the consideration specified in this Article 1.

Section 1.2 Purchase Price. The purchase price for the Shares (the “Purchase Price”) shall be $2,100,000.

Section 1.3 Payment of Purchase Price. Purchaser agrees to pay to Seller the Purchase Price at the Closing by wire transfer or delivery of other immediately available funds to an account of Seller designated to Purchaser prior to the Closing. For purposes of this Agreement, the term “Business Day” shall mean any day, other than a Saturday or a Sunday, that is neither a legal holiday nor a day on which banking institutions are generally authorized or required by law or regulation to close in the City of New York.

ARTICLE 2

CLOSING AND DELIVERY

Section 2.1 Closing Date. The closing (the “Closing”) of the sale and purchase of the Shares (the “Stock Purchase”) shall take place at the offices of Torys LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00 A.M. (New York City time) on the third (3rd) Business Day following satisfaction or, if permissible, waiver of the conditions set forth in Article 6 of this Agreement (excluding those conditions which by their nature are to be satisfied as a part of the Closing) or at such other place, time or date as the parties hereto may agree (the time and date of the Closing being herein referred to as the “Closing Date”).

Section 2.2 Deliveries by Seller to Purchaser. On the Closing Date, Seller shall deliver, or cause to be delivered, to Purchaser the following:

(a) a certificate or certificates evidencing all of the Shares, duly endorsed in blank or accompanied by stock powers duly executed in blank, in proper form for transfer;

(b) the certificates and other documents and instruments to be delivered pursuant to Section 6.2 hereof; and

Section 2.3 Deliveries by Purchaser to Seller. On the Closing Date, Purchaser shall deliver, or cause to be delivered, to Seller the following:

(a) the Purchase Price, in accordance with Section 1.3 hereof;

(b) the certificates and other documents and instruments to be delivered pursuant to Section 6.3 hereof; and

ARTICLE 3

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

As used herein (i) any reference to any event, change or effect being “material” with respect to the Company means an event, change or effect which is material in relation to the condition (financial or otherwise), properties, business, operations, prospects, assets or results of operations of the Company, and (ii) the term “Material Adverse Effect” on the Company means a material adverse effect on the condition (financial or otherwise), properties, business, operations, prospects, assets or results of operations of the Company.

The Company hereby represents and warrants to Purchaser as follows:

Section 3.1 Organization and Good Standing. The Company is a corporation duly organized, validly existing and in good standing under the laws of its respective jurisdiction of incorporation with full corporate power and authority to conduct its business as it is now being conducted. The Company is duly qualified or licensed to do business as a foreign corporation and is in good standing as a foreign corporation in each jurisdiction in which either the ownership or use of the properties owned or used by it, or the nature of the activities conducted by it, requires such licensing, qualification or good standing, except for any failure to so license, qualify or be in such good standing, which, when taken together with all other such failures, has not had, does not have and could not reasonably be expected to have a Material Adverse Effect on the Company.

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Section 3.2 Capitalization.

(a) The authorized capital stock of the Company consists solely of 300,000,000 shares of Common Stock, and 25,000,000 shares of Preferred Stock, of which 100,099,586 shares of Common Stock are issued and outstanding and of which no shares of Preferred Stock are issued and outstanding. All of the issued and outstanding shares of capital stock of the Company have been duly authorized and are validly issued, fully paid and nonassessable and have been issued in compliance with all foreign, federal and state securities laws.

(b) The unissued Shares to be issued and sold by the Company to the Purchaser hereunder have been duly and validly authorized and, when issued and delivered against payment therefore as provided herein, will be duly and validly issued and fully paid and non-assessable.

Section 3.3 Corporate Authority. The Company has taken all corporate action necessary in order to execute, deliver and perform fully, its obligations under this Agreement and to consummate the Stock Purchase contemplated hereby. The execution and delivery by the Company of this Agreement and the consummation by the Company of the Stock Purchase contemplated hereby have been duly authorized and approved by the Board of Directors of the Company and no other corporate proceeding with respect to the Company is necessary to authorize this Agreement or the Stock Purchase contemplated hereby. This Agreement has been duly executed and delivered by the Company and constitutes a valid and binding agreement of the Company, enforceable against the Company in accordance with its terms.

Section 3.4 No Violations. The execution and delivery by the Company of this Agreement does not, and the performance and consummation by the Company of the Stock Purchase contemplated hereby will not, directly or indirectly (with or without the giving of notice or the lapse of time or both):

(a) contravene, conflict with, or constitute or result in a breach or violation of, or a default under (i) any provision of the Company’s Certificate of Incorporation or By-laws or (ii) any resolution adopted by the Board of Directors (or similar governing body) of the Company; or

(b) contravene, conflict with, or constitute or result in a breach or violation of any Law (as defined below), award, decision, injunction, judgment, decree, settlement, order, process, ruling, subpoena or verdict (whether temporary, preliminary or permanent) entered, issued, made or rendered by any court, administrative agency, arbitrator, Governmental Entity or other tribunal of competent jurisdiction (“Order”) or give any Governmental Entity or any other Person the right to challenge the Stock Purchase contemplated hereby.

For purposes of this Agreement, the term “Law” shall mean any federal, state, local, municipal, foreign, international, multinational, or other constitution, law, rule, standard, requirement, administrative ruling, order, ordinance, principle of common law, legal doctrine, code, regulation, statute, treaty or process.

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Section 3.5 Actions. There are no civil, criminal, administrative, investigative or informal actions, audits, demands, suits, claims, arbitrations, hearings, litigations, disputes, investigations or other proceedings of any kind or nature (“Actions”) or Orders issued, pending or, to the knowledge of the Company, threatened, against the Company or any of its assets, at law, in equity or otherwise, in, before, by, or otherwise involving, any Governmental Entity, arbitrator or other Person that individually or in the aggregate, (i) have had, do have or could reasonably be expected to have a Material Adverse Effect on the Company or (ii) question or challenge the validity or legality of, or have the effect of prohibiting, preventing, restraining, restricting, delaying, making illegal or otherwise interfering with, this Agreement, the consummation of the Stock Purchase contemplated hereby or any action taken or proposed to be taken by the Company pursuant hereto or in connection with the Stock Purchase contemplated hereby. To the knowledge of the Company, no event has occurred or circumstance exists that could reasonably be expected to give rise to or serve as a basis for the commencement of any such Action or the issuance of any such Order.

Section 3.6 SEC Reports. The Company has filed all reports required to be filed by it under the Securities Act and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including pursuant to Section 13(a) or 15(d) thereof (the foregoing materials being collectively referred to herein as the “SEC Reports”), on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act and the rules and regulations of the Securities and Exchange Commission (the “Commission”) promulgated thereunder, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

Section 3.7 Internal Accounting Controls; Xxxxxxxx-Xxxxx Act of 2002. The Company maintains a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company has established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and designed such disclosures controls and procedures to ensure that material information relating to the Company, is made known to the certifying officers by others within those entities, particularly during the period in which the Company’s Form 10-K or 10-Q, as the case may be, is being prepared. The Company’s certifying officers have evaluated the effectiveness of the Company’s controls and procedures as of the date of its most recently filed periodic report (such date, the “Evaluation Date”). The Company presented in its most recently filed periodic report the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date.

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Section 3.8 Trading With the Enemy Act; Patriot Act. To the knowledge of the Company, no sale of the Company’s securities by the Company nor the Company’s use of the proceeds from such sale has violated the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto. Without limiting the foregoing, the Company (a) is not a person whose property or interests in property are blocked pursuant to Section 1 of Executive Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)) and (b) to the knowledge of the Company, does not engage in any dealings or transactions, or be otherwise associated, with any such person. The Company is in compliance with the USA Patriot Act of 2001 (signed into law October 26, 2001).

Section 3.9 Listing of Common Stock. The Common Stock is eligible to trade and be quoted on, and is quoted on, the over-the-counter Bulletin Board market maintained by The Nasdaq Stock Market (the “OTCBB”) and the Company has received no notice or other communication indicating that such eligibility is subject to challenge or review by any applicable regulatory agency, electronic market administrator, or exchange. The Company has not, and shall not take any action that would preclude, or otherwise jeopardize, the inclusion of the Common Stock for quotation on the OTCBB. The Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all listing requirements of the OTCBB.

ARTICLE 4

REPRESENTATIONS AND WARRANTIES OF PURCHASER

Purchaser hereby represents and warrants to Seller as follows:

Section 4.1 Organization and Good Standing. Purchaser is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware.

Section 4.2 Corporate Authority. Purchaser has the full legal right, requisite corporate power and authority and has taken all corporate action necessary in order to execute, deliver and perform fully, its obligations under this Agreement and to consummate the Stock Purchase. The execution and delivery by Purchaser of this Agreement and the consummation by Purchaser of the Stock Purchase have been duly authorized and approved by the governing body of Purchaser and no other corporate proceeding with respect to Purchaser is necessary to authorize this Agreement or the Stock Purchase contemplated hereby. This Agreement has been duly executed and delivered by Purchaser and constitutes a valid and binding agreement of Purchaser, enforceable against Purchaser in accordance with its terms.

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Section 4.3 No Violations. (a) The execution and delivery by Purchaser of this Agreement does not, and the performance and consummation by Purchaser of the Stock Purchase will not, with respect to Purchaser, directly or indirectly (with or without the giving of notice or the lapse of time or both):

(i) contravene, conflict with, or constitute or result in a breach or violation of, or a default under (A) any provision of the Certificate of Incorporation or By-laws (or equivalent documents) of Purchaser or (B) any resolution adopted by the Board of Directors (or similar governing body) of Purchaser; or

(ii) contravene, conflict with, or constitute or result in a breach or violation of, any material Law or Order to which Purchaser, or any of the assets owned or used by Purchaser, are subject.

Section 4.4 Securities Act. Purchaser is acquiring the Shares for its own account and not with a view to their distribution within the meaning of Section 2(a)(11) of the Securities Act of 1933, as amended (the “Securities Act”) in any manner that would be in violation of the Securities Act.

Section 4.5 Purchaser Status. At the time Purchaser was offered the Shares, it was, and at the date hereof it is, an “accredited investor” as defined in Rule 501(a) under the Securities Act or a “qualified institutional buyer” as defined in Rule 144A under the Securities Act.

Section 4.6 Experience of Purchaser. Purchaser, either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Shares, and has so evaluated the merits and risks of such investment. Purchaser understands that it must be able to bear the economic risk of this investment in the Shares indefinitely, and is able to bear such risk and is able to afford a complete loss of such investment.

Section 4.7 Access to Information. Purchaser acknowledges that it has been afforded: (i) the opportunity to ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the Shares and the merits and risks of investing in the Shares; (ii) access to information (other than material non-public information) about the Company and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment.

Section 4.8 Restricted Securities. Purchaser understands that the Shares are characterized as “restricted securities” under the U.S. federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such securities may be resold without registration under the Securities Act only in certain limited circumstances.

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ARTICLE 5

COVENANTS

Section 5.1 Public Announcements. Each of the parties hereto shall consult with each other before issuing any press release or making any public statement with respect to this Agreement or the Stock Purchase contemplated hereby and, except as may be required by applicable law, will not issue any such press release or make any such public statement prior to such consultation and without the consent of the other parties.

Section 5.2 Notices of Certain Events. In addition to any other notice required to be given by the terms of this Agreement, each of the parties shall promptly notify the other parties hereto of:

(a) any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with the Stock Purchase contemplated by this Agreement;

(b) any notice or other communication from any governmental or regulatory agency or authority in connection with the Stock Purchase contemplated by this Agreement; and

(c) any actions, suits, claims, investigations or proceedings commenced or, to its knowledge threatened against, relating to or involving or otherwise affecting such party or that relate to the consummation of the Stock Purchase contemplated by this Agreement.

ARTICLE 6

CONDITIONS PRECEDENT

Section 6.1 Conditions to Each Party’s Obligations to Consummate. The respective obligations of each party to consummate the Stock Purchase contemplated by this Agreement shall be subject to the fulfillment or waiver at or prior to the Closing of the following conditions:

(a) No Termination. This Agreement shall not have been terminated pursuant to Section 7.1.

(b) Absence of Litigation; No Orders. No formal or informal action or proceeding shall have been instituted on or before the Closing Date before any court or governmental body or authority pertaining to the Stock Purchase, the result of which would prevent or make illegal the consummation of such Stock Purchase or which could have a Material Adverse Effect on the Company. Neither the Company nor Purchaser shall be subject to any order, decree or injunction of a court or agency of competent jurisdiction which either enjoins or prohibits the consummation of the Stock Purchase.

Section 6.2 Conditions Precedent to Purchaser’s Obligations. The obligations of Purchaser to consummate the Stock Purchase contemplated hereby shall be subject to the fulfillment or waiver (in whole or in part by Purchaser) at or prior to the Closing of the following conditions:

(a) Representations and Warranties. Each of the representations and warranties of the Company set forth in this Agreement shall in each case be true and correct in all material respects (if not qualified by “materiality” or “Material Adverse Effect”) and in all respects (if qualified by “materiality” or “Material Adverse Effect”) as of the date of this Agreement and as of the Closing Date, with the same effect as though such representations and warranties had been made on and as of the Closing Date;

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(b) Covenants. All of the covenants, agreements, undertakings and obligations that the Company is required to perform or to comply with pursuant to this Agreement at or prior to the Closing, shall have been duly performed and complied with; the Company must have delivered to Purchaser each of the documents required to be delivered by Seller pursuant to Section 2.2 hereof;

(c) Officer’s Certificate. The Company shall have delivered to Purchaser a certificate, dated as of the Closing Date and signed by the Chief Executive Officer of the Company, representing that the conditions referred to in Section 6.2(a) and Section 6.2(b) hereof have been satisfied;

(d) Good Standing Certificate. The Company shall have furnished Purchaser with a good standing and existence certificate for the Company in its jurisdiction of incorporation and any jurisdictions in which it is qualified to do business as Purchaser reasonably requests; and

(e) Other Documentation. Purchaser shall have received such other documents, certificates, opinions or statements as Purchaser may reasonably request.

Section 6.3 Conditions Precedent to the Company’s Obligations. The obligations of the Company to consummate the transactions contemplated hereby shall be subject to the fulfillment or waiver (in whole or in part by the Company) at or prior to the Closing of the following conditions:

(a) Representations and Warranties. Each of the representations and warranties of Purchaser set forth in this Agreement shall in each case be true and correct in all material respects (if qualified by “Materiality” or “Material Adverse Effect”) as of the date of this Agreement and as of the Closing Date, with the same effect as though such representations and warranties had been made on and as of the Closing Date;

(b) Covenants. All of the covenants, agreements, undertakings and obligations that Purchaser is required to perform or to comply with pursuant to this Agreement at or prior to the Closing, shall have been duly performed and substantially complied with. Purchaser must have delivered to the Company each of the documents required to be delivered by Purchaser pursuant to Section 2.3 hereof;

(c) Officer’s Certificate. Purchaser shall have delivered to the Company a certificate, dated as of the Closing Date and signed by a senior executive officer or officers of Purchaser, representing that the conditions referred to in Section 6.3(a) and Section 6.3(b) hereof have been satisfied;

(d) Payment of Purchase Price. The Company shall have received the Purchase Price in accordance with Section 1.3; and

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(e) Lock-up Agreement. Purchaser shall have delivered to the Company an executed lock-up agreement that is satisfactory to the Company.

ARTICLE 7

TERMINATION

Section 7.1 Termination. This Agreement may be terminated and the sale of Shares may be abandoned at any time prior to the Closing:

(a) by mutual written consent of the parties hereto;

(b) by either the Company or Purchaser if the Closing shall not have occurred on or before December 31, 2008 (unless the failure to consummate the transactions by such date shall be due to the action or failure to act of the party seeking to terminate this Agreement);

(c) by Purchaser if: (i) the Company shall have failed to comply in any material respect with any of the covenants or agreements contained in this Agreement to be complied with or performed by the Company; or (ii) any representations and warranties of Seller contained in this Agreement shall not have been true when made, or on and as of the Closing Date as if made on and as of the Closing Date (except to the extent it relates to a particular date); or

(d) by the Company if: (i) Purchaser shall have failed to comply in any material respect with any of the covenants or agreements contained in this Agreement to be complied with or performed by Purchaser; or (ii) any representations and warranties of Purchaser contained in this Agreement shall not have been true when made, or on and as of the Closing Date as if made on and as of the Closing Date (except to the extent it relates to a particular date).

Section 7.2 Effect of Termination. In the event of the termination and abandonment of this Agreement pursuant to Section 7.1 of this Agreement, this Agreement (other than Section 8.3 (Fees and Expenses), Section 8.5 (Governing Law) and Section 8.6 (Consent to Jurisdiction; Waiver of Jury Trial), which shall remain in full force and effect) shall forthwith become null and void and no party hereto shall have any Liability or further obligation to any other party hereto, except as provided in this Section 7.2; provided, however, that if this Agreement is terminated by a party because of the breach of this Agreement by the other party or because one or more of the conditions of the terminating party’s obligations under this Agreement is not satisfied as a result of the other party’s failure to fully comply with its obligations under this Agreement, the terminating party’s rights to pursue all legal remedies will survive such termination unimpaired.

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ARTICLE 8

MISCELLANEOUS

Section 8.1 Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given (a) on the date received if delivered personally or by facsimile or (b) on the date received if mailed by registered or certified mail (return receipt requested), to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):


		If to Seller:

		PetroAlgae Inc. 0000 X. Xxxxxx Xxxx Xxxxxxxxx Xxxxx 000
		Xxxxxxxxx, Xxxxxxx 00000
		Attn: Xxxxx Xxxxxxx
		Facsimile: (000) 000-0000

		With a copy (which shall not constitute notice) to:

		Torys LLP
		000 Xxxx Xxxxxx 00xx Xxxxx Xxx Xxxx, Xxx Xxxx 00000
		Attn: Xxxxxx X. Xxxx
		Xxxxxx X. Raglan
		Facsimile: (000) 000-0000

		If to Purchaser:

		Valens Offshore SPV I, Ltd. c/o Valens Capital Management LLC 000 Xxxxxxx Xxxxxx 00xx Xxxxx
		Xxx Xxxx, Xxx Xxxx 00000
		Attn: Xxx Xxxxx
		Facsimile: (000) 000-0000

Section 8.2 Amendments; No Waivers.

(a) Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is signed, in the case of an amendment, by the Company and Purchaser; or in the case of a waiver, by the party against whom the waiver is to be effective.

(b) No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law.

Section 8.3 Fees and Expenses. Except as otherwise expressly provided herein, whether or not the transactions contemplated hereby are consummated, all costs and expenses incurred in connection with this Agreement and the obligations contemplated hereby shall be

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paid by the party incurring such cost or expense. In the event of termination of this Agreement, the obligation of each party to pay its own expenses will be subject to any rights of such party arising from a breach of this Agreement by another party.

Section 8.4 Successors and Assigns; No Third-Party Beneficiaries. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns; provided that no party may assign, delegate or otherwise transfer any of its rights or obligations under this Agreement without the consent of each other party hereto, but any such transfer or assignment will not relieve the appropriate party of its obligations hereunder. Nothing in this Agreement, express or implied, is intended to confer upon any other Person any rights or remedies of any nature whatsoever under or by reason of this Agreement or any provision of this Agreement.

Section 8.5 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to the principles of conflicts of law thereof.

Section 8.6 Consent to Jurisdiction; Waiver of Jury Trial.

(a) Any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the Stock Purchase contemplated hereby may be brought in any federal or state court located in the City of New York, Borough of Manhattan, and each of the parties hereby consents to the jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding which is brought in any such court has been brought in an inconvenient forum. Process in any such suit, action or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each party agrees that service of process on such party as provided in Section 8.1 shall be deemed effective service of process on such party.

(b) Each party hereto hereby acknowledges and agrees that any controversy which may arise under this Agreement is likely to involve complicated and difficult issues, and therefore each such party hereby irrevocably and unconditionally waives any right such party may have to a trial by jury in respect of any litigation directly or indirectly arising out of or relating to this Agreement, any document referred to in this Agreement or the Stock Purchase contemplated hereby.

Section 8.7 Counterparts; Effectiveness. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement shall become effective when each party hereto shall have received counterparts hereof signed by all of the other parties hereto. No provision of this Agreement is intended to confer upon any Person other than the parties hereto any rights or remedies hereunder.

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Section 8.8 Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter of this Agreement and supersedes all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter hereof.

Section 8.9 Captions. The captions herein are included for convenience of reference only and shall be ignored in the construction or interpretation hereof.

Section 8.10 Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the Stock Purchase contemplated hereby is not affected in any manner materially adverse to any parties. Upon such a determination, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible.

Section 8.11 Definition and Usage.

For purposes of this Agreement:

“Governmental Entity” means any foreign, federal, state, local, municipal, county or other governmental, quasi-governmental, administrative or regulatory authority, body, agency, court, tribunal, commission or other similar entity (including any branch, department or official thereof).

“Liability” means any debt, liability, commitment or obligation of any kind, character or nature whatsoever, whether known or unknown, xxxxxx or inchoate, secured or unsecured, accrued, fixed, absolute, contingent or otherwise, and whether due or to become due.

“Lien” means any charges, claims, community property interests, conditions, conditional sale or other title retention agreements, covenants, easements, encumbrances, equitable interests, exceptions, liens, mortgages, options, pledges, reservations, rights of first refusal, security interests, or restrictions of any kind, including any restrictions on use, voting, transfer, alienation, receipt of income, or exercise of any other attribute of ownership.

Section 8.12 Survival. All covenants contained herein shall survive the Closing. The representations and warranties contained herein shall not survive the Closing; provided that the representations and warranties of Purchaser set forth in Section 4.4, Section 4.5, Section 4.6, Section 4.7 and Section 4.8 shall survive the Closing.

Section 8.13 Further Assurances. From time to time, each party hereto will execute such additional instruments and take such actions as may be reasonably required to carry out the intent and purposes of this Agreement.

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Section 8.14 Review of Agreement. Each party hereto acknowledges that it has had time to review this Agreement and, as desired, consult with counsel. In the interpretation of this Agreement, no adverse presumption shall be made against any party on the basis that it has prepared, or participated in the preparation of, this Agreement.

Section 8.15 Brokerage. Each party hereto represents and warrants to the other that there are no claims for brokerage commissions or finder’s fees or agent’s commissions or other like payment in connection with this Agreement or the transactions contemplated hereby, except for such commissions and fees incurred by reason of any action taken by a party hereto that will be paid by and be the responsibility of such party.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered as of the day and year first above written by the duly authorized officers of Seller and Purchaser.


SELLER:

PETROALGAE INC.

By:		/s/ Xxxxx Xxxxxxx
Name:		Xxxxx Xxxxxxx
Title:		President

PURCHASER:

VALENS U.S. SPV I, LLC

By:		Valens Capital Management, LLC its investment manager

By:		/s/ Xxxxxxx Xxxxx
Name:		Xxxxxxx Xxxxx
Title:		Authorized Signatory

[SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT]

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