The Michigan Strategic Fund
In December 2008, we entered into a grant agreement with the Michigan Strategic Fund, or MSF, in
connection with a grant of funds from the MSF to fund our planned hardwood CBP facility in Kinross, Michigan. In connection with this grant agreement, as amended in March 2009, we were awarded a grant of up to $20.0 million, to be paid in installments upon certain milestones such as filing required environmental permits and finalizing commercial agreements relating to supply, construction and operation of the planned facility. As of June 30, 2011, we have received $12.1 million from MSF. Our ongoing obligations under this grant agreement include providing regular progress reports on the status of the project and the milestones achieved. Unless earlier terminated for default under the terms identified in the grant agreement, the term of this grant agreement lasts until December 2013.
The Province of Alberta, Canada
In March 2010, we entered into a Biorefining Commercialization and Market Development Program Grant
Agreement with the Province of Alberta, Canada, or Alberta, in connection with receiving financial assistance for the development of our planned commercial cellulosic ethanol facility in Alberta, Canada. Under this arrangement, Alberta will provide up to $0.8 million in funding to be used exclusively for this project. Until the completion of the project, we are obligated to provide regular reports on the status of the project, and upon receipt of any study, analysis or report relating to the project, forward them to Alberta.
The BioEnergy Science Center
In June 2008, we entered into a subcontract with UT-Battelle, LLC, or UT, governing funds for the research and development to achieve advances in sustainable production and economical conversion of lignocellulosic biomass to enable the production of biofuels. We are one of the more than a dozen participants in the BioEnergy Science Center, or BESC, supporting the multi-year effort to overcome recalcitrance of cellulosic biomass to conversion. BESC will provide up to approximately $6.3 million to fund our portion of the project. As of June 30, 2011, we have received $5.1 million from BESC. Our obligations include providing regular reports on the status of research and progress of the project, and ensuring that two of our employees and consultants remain on the project. Under the terms of the subcontract, we retain patent rights to inventions arising from the project, while the United States government receives a nonexclusive license to use such inventions. The term of the contract lasts through September 2012.
The U.S. Department of Energy
In September 2008, we were awarded with a grant of funds from the United States Department of Energy, or the DOE, for the construction of an industrial scale fermenter system and the design, construction and operation of an integrated cellulosic ethanol plant for transforming locally grown mixed hardwoods or switchgrass into ethanol. Under this grant, the DOE will provide us with up to approximately $20.0 million, payable in phases and dependent on the results of each phase. We are required to make periodic progress reports on the status of our project and notify the DOE of any significant favorable or adverse events during the course of the project.
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