Geobio Energy (fka GBOE)

[XenaLives]

So all they got was distribution for a Chezch company.

Exclusive Distribution Agreement



As discussed in Note 1, in November 2011, the Company acquired the exclusive distribution rights to El Gas NA’s exclusive distributer contract to distribute El Gas s.r.o’s natural gas volume monitoring and correcting equipment and data recorder products in territories including the United States, Canada, Mexico and the Caribbean Islands. The term of the Exclusive Distribution Agreement is through December 31, 2013, with automatic, annual renewals unless cancelled by either party upon three month notice prior to the end of each term. The Company has estimated the useful life of the agreement to be five years. The Company issued 2,500,000 shares of its restricted common stock to acquire the exclusive distribution rights and an 8% promissory note with original principal value of $100,000. The distribution rights were recorded at the fair value of the promissory note of $100,000 plus the market value of the Company’s common stock on November 14, 2011 (closing date of the agreement) of $0.03 per share or $75,000, for a total of $175,000. The Company began amortizing the exclusive distribution agreement during the quarter ended December 31, 2012 because product sales have commenced. Amortization expense was $8,750 for the three months ended December 31, 2012. The Company expects that amortization expense will approximate $35,000 in each of the fiscal years 2013, 2014, 2015, 2016 and 2017, respectively.

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