AEMETIS, INC (Form: 8-K, Received: 07/10/2012 09:57:56)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (date of earliest event reported): July 6, 2012

AEMETIS, INC.

(Exact name of registrant as specified in its charter)

Nevada		000-51354		26-1407544
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification Number)

20400 Stevens Creek Blvd., Suite 700

Cupertino, CA 95014

(Address of principal executive offices) (Zip Code)

(408) 213-0940

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

Agreement and Plan of Merger

On July 6, 2012, Aemetis, Inc. (the “Company”), AE Advanced Fuels, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Aemetis Sub”), and Keyes Facility Acquisition Corp., a Delaware corporation and wholly-owned subsidiary of Aemetis Sub (“Merger Sub”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Cilion, Inc., a Delaware corporation (“Cilion”).

Pursuant to the terms of the Merger Agreement, and subject to the conditions thereof, Merger Sub will merge with and into Cilion with Cilion continuing as the surviving corporation in the merger (the “Merger”). At the effective time of the Merger, each share of Cilion Series A Preferred Stock, par value $0.001 per share (the “Series A Preferred Stock”), (b) Cilion Series B Preferred Stock, par value $0.001 per share (the “Series B Preferred Stock”), and (c) Cilion Series C Preferred Stock, par value $0.001 per share (the “Series C Preferred Stock” and together with the Series A Preferred Stock and Series B Preferred Stock, the “Cilion Preferred Stock”) that is issued and outstanding immediately prior to the effective time of the Merger, other than issued and outstanding Cilion Preferred Stock that is owned by (i) the Company, Aemetis Sub, Merger Sub or any other direct or indirect wholly-owned subsidiary of the Company, (ii) Cilion as treasury stock or any direct or indirect wholly-owned subsidiary of Cilion or (iii) stockholders that have perfected appraisal rights under Delaware law, will be automatically converted into the right to receive aggregate consideration of (a) $16,500,000, plus (i) all cash and cash equivalents held by Cilion as of the Closing, minus (ii) the Securityholders’ Representative Fund, minus (iii) the Closing Date Indebtedness of Cilion, and minus (iv) the amount of any Transaction Expenses which are not paid prior to the Closing (collectively, the “Cash Merger Consideration”), and (b) 20,000,000 shares of Common Stock of the Company (the “Stock Merger Consideration”), and (c) the right to receive an additional cash amount of $5,000,000 plus interest at the rate of 3% per annum, which is payable upon the satisfaction by the Company of certain conditions set forth in the Merger Agreement (the “Contingent Merger Consideration”). In addition, at the effective time of the Merger, each outstanding share of Cilion Common Stock and each outstanding option, warrant or other right to acquire Cilion Common Stock, whether or not then vested or exercisable, will be automatically canceled and shall cease to be outstanding, and no consideration shall be delivered in exchange therefor.

The Merger Agreement contains customary representations, warranties and covenants of the Company, Aemetis Sub and Merger Sub on the one hand and of Cilion on the other hand, including, among other things, covenants regarding: (i) the conduct of the business of Cilion and its subsidiaries prior to the consummation of the Merger; (ii) the use of the parties’ reasonable best efforts to cause the Merger to be consummated, including the abstention by Cilion from soliciting, providing information or entering into discussions concerning alternative acquisition proposals relating to Cilion and the solicitation of the consent of the stockholders of Cilion to the Merger.

The representations, warranties, covenants and agreements of the Company and Cilion contained in the Merger Agreement have been made (i) only for purposes of the Merger Agreement, (ii) have been qualified by confidential disclosures made to the other party in disclosure letters delivered in connection with the Merger Agreement, (iii) are subject to materiality qualifications contained in the Merger Agreement which may differ from what may be viewed as material by investors, (iv) were made only as of the date of the Merger Agreement or such other date as is specified in the Merger Agreement and (v) have been included in the Merger Agreement for the purpose of allocating risk between the parties rather than establishing matters as fact. Accordingly, the Merger Agreement is included as an exhibit to this Current Report on Form 8-K only to provide investors with information regarding the terms of the Merger Agreement, and not to provide investors with any other factual information regarding the Company or its business. Investors should not rely on the representations, warranties, covenants and agreements, or any descriptions thereof, as characterizations of the actual state of facts or condition of the Company or any of its subsidiaries or affiliates. In addition, information concerning the subject matter of the representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures.

In connection with the Merger Agreement, the Company and the stockholders of Cilion entered into a Stockholders’ Agreement, dated as of July 6, 2012, (the “Stockholders Agreement”), pursuant to which the Company agreed, among other things, (i) to permit a person designated by the Securityholders’ Representative to be present in a nonvoting observer capacity (subject to certain exceptions) at all regularly scheduled meetings of the Company’s Board of Directors for a period of three (3) years and during such period to receive copies of all materials that are sent to the directors in their capacity as such in connection with such Board meeting, and (ii) to grant the Cilion Stockholders certain registration rights with respect to the Stock Merger Consideration.

The foregoing descriptions of the Merger Agreement and the Stockholders Agreement are only summaries, do not purport to be complete and are qualified in their entirety by reference to the full text of the Merger Agreement and the Stockholders Agreement, which are filed as Exhibits 2.1 and 10.1 hereto, respectively, and which are incorporated herein by reference.

Amended and Restated Note Purchase Agreement

On July 6, 2012, the Company, Aemetis Advanced Fuels Keyes, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“AEAFK”), and Merger Sub entered into an Amended and Restated Note Purchase Agreement with Third Eye Capital Corporation, as agent (“Administrative Agent”) for the noteholders who are a party thereto (the “Lenders”), and the Lenders (the “Credit Agreement”), pursuant to which the Lenders have agreed to extend new credit in the form of (i) senior secured term loans in an aggregate principal amount of $15,000,000 that will be used to fund the cash portion of the Merger; (ii) senior secured term loans in the principal amount of approximately $10,000,000 to repay existing indebtedness; and (iii) senior secured revolving loans in an aggregate principal amount at any time outstanding not in excess of $18,000,000.

General Terms

The Credit Agreement provides for (i) a new senior secured term loan in the principal amount of $15 million, which will be used to pay the cash portion of the Merger Consideration (the “Term Loan”), (ii) a new senior secured term loan in the aggregate principal amount of $10 million which finances outstanding payments due under the Revenue Participation obligations (the “RevPar Loan”); (iii) a new senior secured $18 million revolving credit facility (the “Revolving Loan”). In addition, approximately $7.2 million in existing debt of the Company was rolled into a new term loan facility (the “Existing Loan” and together with the Term Loan, the RevPar Loan, and the Revolving Loan, the “Credit Facilities”). In addition, the Company’s revenue participation obligations set forth under the Note Purchase Agreement dated October 2010 were terminated. Concurrently with the consummation of the Merger, the full amount of the Term Loan, RevPar Loan and Existing Loans were drawn and $15 million of the Revolving Loan was drawn.

Maturity of Credit Facilities . The Term Loan and the RevPar Loan have a two-year maturity. The Revolving Loan has a one-year maturity, provided, that the maturity date may be extended for up to two additional periods of one year upon written notice subject to the condition that no Event of Default has occurred and the payment of a renewal fee for each additional one year period. The maturity date of the Existing Loan remained the same at October 18, 2012, provided that the maturity date may be extended for an additional period of six months subject to the conditions that no Event of Default has occurred and is continuing, payment of a renewal fee and satisfaction of certain other conditions set forth in the Credit Agreement. All outstanding principal and unpaid accrued interest of the Credit Facilities is due and payable at maturity.

Payment of Existing Notes Prior to Maturity . From the date of the Credit Agreement until July 31, 2012, the Borrowers are required to redeem Existing Notes having an aggregate face value equal to 50% of the Borrowers’ Free Cash Flow for each month in such period. Commencing August 1, 2012, Borrower is required to redeem Existing Notes in the amount of $50,000 each week (the “Weekly Redemption Amount”). In addition, each month the Borrowers are required to redeem Existing Notes in an amount equal to the positive difference between (A) the greater of (i) $0.05 per gallon of ethanol produced from the Keyes Plant and (ii) 50% of the Borrowers’ Free Cash Flow and (B) the total Weekly Redemption Amounts for such month. In addition, the Borrowers are required to redeem Existing Notes in an amount equal to $300,000 on the final business day of each quarter commencing with the third fiscal quarter of 2012.

Payment of Other Notes Prior to Maturity . Upon the occurrence of a Redemption Event (defined in the Credit Agreement), the Borrowers are required to redeem that portion of the Notes equal to the net proceeds received by the Borrowers from such Redemption Event. The Notes are redeemed in the following order of priority: (a) the Existing Notes, (b) the Acquisition Notes, (c) the Revenue Participation Notes, and (d) the Revolving Notes. In addition, if the Company or any of its U.S. subsidiaries completes an equity offering that results in gross proceeds of at least $50,000,000, the Borrowers are required to redeem the RevPar Loan in an amount equal to the sum of the then outstanding principal balance, plus all accrued and unpaid interest owing thereon.

Interest Rate

The interest rate per annum applicable to the Term Loan and the Revolving Loan under the Credit Agreement will be based on a fluctuating rate of interest determined by reference to a base rate determined by reference to the rate last quoted by The Wall Street Journal as the “Prime Rate” in the United States. As of the closing date, (i) the Term Loan will have a margin equal to 10.75%, reducing to 8.75% if the outstanding principal balance is equal to or greater than $5,000,000 but less than $10,000,000 and 6.75% per annum if the aggregate outstanding principal balance is less than $5,000,000; and (ii) the Revolving Loan have a margin equal to 13.75%, reducing to 11.75% if the outstanding principal balance is equal to or greater than $5,000,000 but less than $10,000,000 and 9.75% per annum if the aggregate outstanding principal balance is less than $5,000,000. As of the closing date, the interest rate of the RevPar Loan was 5% per annum, and the interest rate of the Existing Loan was 14% per annum decreasing to 12% at such time as Borrowers have made additional principal payments of $950,000.

Covenants

The Credit Facility contain a number of customary affirmative and negative covenants that, among other things, will limit or restrict the ability of the Company and its subsidiaries to: incur additional indebtedness (including guarantee obligations); incur liens; engage in mergers, consolidations, liquidations and dissolutions; sell assets; pay dividends and make other payments in respect of capital stock; make capital expenditures; make acquisitions, investments, loans and advances; pay and modify the terms of certain indebtedness; engage in certain transactions with affiliates; enter into certain speculative hedging arrangements; enter into negative pledge clauses and clauses restricting subsidiary distributions; change their lines of business; and change their accounting fiscal year, name or jurisdiction of organization. In addition, under the Credit Facility the Company will be required to (i) maintain a minimum amount of Free Cash Flow, (ii) maintain certain debt to value ratios, (iii) maintain certain production levels, and (iv) limit purchases of capital expenditures.

Events of Default

The Credit Facility contains customary events of default, including nonpayment of principal, interest, fees or other amounts; material inaccuracy of a representation or warranty when made; violation of covenants; cross-default to material indebtedness; bankruptcy events; material unsatisfied judgments; actual or asserted invalidity of any guarantee, security document or subordination provisions; non-perfection of the security interest on a material portion of the collateral; and change of control.

Security Agreements

In connection with the Credit Facility, the Company and certain of its direct and indirect subsidiaries (the “Subsidiary Guarantors”) entered into an Amended and Restated Guaranty Agreement (the “Guaranty”), dated as of July 6, 2012 and an Amended and Restated Security Agreement dated July 6, 2012 (the “Security Agreement”), with the Administrative Agent as agent for the Lenders. Upon the consummation of the Merger, pursuant to the Amended and Restated Guaranty, the Subsidiary Guarantors guaranteed the obligations of the Company and the Borrowers under the Credit Facility. Additionally, amounts borrowed under the Credit Facility are secured on a first priority basis by a perfected security interest in substantially all of the Company’s and each Subsidiary Guarantor’s tangible and intangible assets. In addition, the Subsidiary Guarantors entered into Deeds of Trust, Pledge Agreements, fixture filings, and other agreements for the purpose of securing the obligations under the Credit Facility and perfecting such security interests.

The foregoing descriptions of the Credit Facility, the Guaranty and Security Agreement are qualified in their entirety by reference to the Amended and Restated Note Purchase Agreement, the Amended and Restated Security Agreement, and the Amended and Restated Guaranty attached hereto as Exhibit 10.2, Exhibit 10.3, and Exhibit 10.4, respectively, which are incorporated herein by reference.

Issuance of Bonus Shares

In consideration for making the Credit Facility and the Loans available to the Company and the Borrowers, the Company issued 15,000,000 shares of its common stock to the Lenders.

Investors’ Rights Agreement

In connection with the Credit Facility, the Company and the Lenders entered into an Investors’ Rights Agreement, dated as of July 6, 2012, (the “Investors’ Rights Agreement”), pursuant to which the Company agreed, among other things, (i) to permit a person designated by the Administrative Agent to be present in a nonvoting observer capacity (subject to certain exceptions) at all regularly scheduled meetings of the Company’s Board of Directors and to receive copies of all materials that are sent to the directors in their capacity as such in connection with such Board meeting, (ii) to grant the Lenders certain registration rights with respect to their shares of stock of the Company; and (iii) rights of first refusal if the Company proposes to sell any shares of, or securities convertible into or exchangeable or exercisable for any shares of, its capital stock to a third party.

The foregoing description of the Investors’ Rights Agreement is qualified in its entirety by reference to the Registration Rights Agreement attached as Exhibit 10.5 hereto, which is incorporated herein by reference.

ITEM 2.01. COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS.

On July 6, 2012, pursuant to the Merger Agreement, Merger Sub merged with and into Cilion, Inc., with Cilion surviving as a wholly owned subsidiary of Sub. Pursuant to the Merger Agreement and in connection with the Merger, each issued and outstanding share of previously existing Cilion Preferred Stock issued and outstanding immediately prior to the effective time of the Merger, other than shares of Cilion Preferred Stock held by stockholders that have perfected appraisal rights under Delaware law, was automatically converted into the right to receive the Cash Merger Consideration, the Stock Merger Consideration and the Contingent Merger Consideration. If the Company issues all 20,000,000 shares of Common Stock to the former Cilion stockholders, the former Cilion stockholders will represent approximately 11% of the issued and outstanding shares of common stock of the Company on a fully diluted basis. No fractional shares of Common Stock were issued in connection with the Merger and holders of fractional shares of Common Stock received a whole share of Common Stock in lieu thereof.

ITEM 3.02. UNREGISTERED SALES OF EQUITY SECURITIES

Pursuant to the Merger, the Company issued to stockholders of Cilion an aggregate of 20,000,000 shares of common stock. The issuance of these shares was made in reliance on Section 4(2) of the Securities Act of 1933 and/or Rule 506 of Regulation D, as promulgated thereunder. Each of the Cilion Stockholders has or will represent that it is an “accredited investor” as defined in the Securities Act and that it was acquiring the Shares for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof.

Pursuant to the Amended and Restated Note Purchase Agreement, the Borrowers issued and sold to the Lenders promissory notes in the aggregate principal amount of up to $43 million (the “Notes”) and the Company issued 15,000,000 shares of its common stock (the “Bonus Shares”). The Notes and Bonus Shares issued to the Lenders were issued and sold in reliance upon exemptions from registration under Regulation S of the Securities Act, and may not be offered or sold in the United States absent registration under or exemption from the Securities Act and any applicable state securities law. Each of the Lenders has represented that it is not a “U.S. Person” as defined in Regulation S of the Securities Act and that it was acquiring the Notes and the Shares in an offshore transaction meeting the requirements of Regulation S, and for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof.

ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.

(a) — (b) Financial Statements of Businesses Acquired; Pro Forma Financial Information.

Pursuant to Item 9.01(a)(4) and Item 9.01(b)(2) of Form 8-K, the Company will amend this filing not later than 74 calendar days after July 9, 2012 to file the financial statements required by Rule 3-05(b) of Regulation S-X and Article 11 of Regulation S-X.

EXHIBIT NO.		DESCRIPTION

2.1		Agreement and Plan of Merger, dated as of July 6, 2012, by and among Aemetis, Inc., AE Advanced Fuels, Inc., Keyes Facility Acquisition Corp., and Cilion, Inc.
10.1		Stockholders’ Agreement, dated July 6, 2012, by and between Aemetis, Inc., and Western Milling Investors, LLC, as Securityholders’ Representative.
10.2		Amended and Restated Note Purchase Agreement, dated July 6, 2012 by and among Aemetis Advanced Fuels Keyes, Inc., Keyes Facility Acquisition Corp., Aemetis, Inc., Third Eye Capital Corporation, as Administrative Agent, and the Noteholders who are a party thereto.
10.3		Amended and Restated Guaranty, dated July 6, 2012 by and among the Company, certain subsidiaries of the Company and Third Eye Capital Corporation, as Agent.
10.4		Amended and Restated Security Agreement, dated July 6, 2012 by and among the Company, certain subsidiaries of the Company and Third Eye Capital Corporation, as Agent.
10.5		Investors’ Rights Agreement, dated July 6, 2012, by and among Aemetis, Inc., and the investors listed on Schedule A thereto.
99.1		Press release dated July 10, 2012

SIGNATURE

Pursuant to the requirements 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 hereunto duly authorized.

		AEMETIS, INC.

Date: July 10, 2012		/s/ Eric A. McAfee
		President and Chief Executive Officer

EXHIBIT 2.1

AGREEMENT AND PLAN OF MERGER

Dated as of July 6, 2012

By and Among

AEMETIS, INC.,

AE ADVANCED FUELS, INC.,

KEYES FACILITY ACQUISITION CORP.,

AND

CILION, INC.

TABLE OF CONTENTS

				Page

ARTICLE I		DEFINITIONS			2

	SECTION 1.1		Definitions		2

ARTICLE II		THE MERGER			11

	SECTION 2.1		The Merger		11
	SECTION 2.2		Closing		11
	SECTION 2.3		Effective Time		11
	SECTION 2.4		Effects of the Merger		11
	SECTION 2.5		Certificate of Incorporation; Bylaws		12
	SECTION 2.6		Board of Directors of the Surviving Corporation		12

ARTICLE III		EFFECT OF THE MERGER			12

	SECTION 3.1		Effect on Capital Stock		12
	SECTION 3.2		Dissenters’ Rights		13
	SECTION 3.3		Closing Payment Schedule		13
	SECTION 3.4		Assignment of Proceeds		14
	SECTION 3.5		Exchange of Certificates		15
	SECTION 3.6		No Further Ownership Rights in Cilion Capital Stock		15
	SECTION 3.7		No Fractional Shares		16
	SECTION 3.8		Anti-Dilution Provisions		16
	SECTION 3.9		Unclaimed Exchange Fund		16
	SECTION 3.10		No Liability		16
	SECTION 3.11		Lost, Stolen or Destroyed Certificates		16
	SECTION 3.12		Withholding Rights		16
	SECTION 3.13		Aemetis Common Stock Legend		17

ARTICLE IV		REPRESENTATIONS AND WARRANTIES			17

	SECTION 4.1		Representations and Warranties of Cilion		17
	SECTION 4.2		Representations and Warranties of Aemetis, Sub and Merger Sub		25

TABLE OF CONTENTS

(continued)

				Page

ARTICLE V		ADDITIONAL AGREEMENTS		29

	SECTION 5.1		Conduct of Business by Cilion	29
	SECTION 5.2		Repayment of Cobank Credit Facility	30
	SECTION 5.3		No Solicitation by Cilion	30
	SECTION 5.4		Access to Information; Confidentiality	30
	SECTION 5.5		Reasonable Best Efforts	30
	SECTION 5.6		Observation Rights	31
	SECTION 5.7		Cilion Employees	31
	SECTION 5.8		Officers’ and Directors’ Indemnification; Indemnification of Stockholders	31
	SECTION 5.9		Anti-Dilution	32
	SECTION 5.10		Information Statement	32
	SECTION 5.11		Use of Name	32
	SECTION 5.12		Tax Matters	32

ARTICLE VI		CONDITIONS PRECEDENT		33

	SECTION 6.1		Conditions to Each Party’s Obligation to Effect the Merger	33
	SECTION 6.2		Conditions to Obligations of Aemetis, Sub and Merger Sub	34
	SECTION 6.3		Conditions to Obligations of Cilion	35
	SECTION 6.4		Frustration of Closing Conditions	35

ARTICLE VII		TERMINATION		36

	SECTION 7.1		Termination	36
	SECTION 7.2		Effect of Termination	36
	SECTION 7.3		Expenses; Termination Fees	37

ARTICLE VIII				37

	SECTION 8.1		Securityholders’ Representative	37
	SECTION 8.2		Securityholders’ Representative Fund	38

TABLE OF CONTENTS

(continued)

				Page

ARTICLE IX		GENERAL PROVISIONS		38

	SECTION 9.1		Amendment	38
	SECTION 9.2		Waiver	38
	SECTION 9.3		No Survival of Representations and Warranties; Survival of Covenants	39
	SECTION 9.4		Notices	39
	SECTION 9.5		Cooperation	40
	SECTION 9.6		Interpretation	40
	SECTION 9.7		Entire Agreement; Counterparts; Exchanges by Facsimile	41
	SECTION 9.8		Assignability; No Third Party Rights	41
	SECTION 9.9		Governing Law; Venue	41
	SECTION 9.10		Disclosure Schedules	41
	SECTION 9.11		Severability	42
	SECTION 9.12		Personal Liability	42
	SECTION 9.13		Absence of Presumption	42

iii

AGREEMENT AND PLAN OF MERGER

This Agreement and Plan of Merger (this “ Agreement ”) dated as of July 6, 2012, is by and among AEMETIS, INC., a Nevada corporation (“ Aemetis ”), AE ADVANCED FUELS, INC., a Delaware corporation and wholly-owned subsidiary of Aemetis (“ Sub ”), KEYES FACILITY ACQUISITION CORP., a Delaware corporation and wholly-owned subsidiary of Sub (“ Merger Sub ”), and CILION, INC., a Delaware corporation (“ Cilion ”).

WHEREAS, the Board of Directors of each of Aemetis, Sub, Merger Sub and Cilion has approved and adopted, and deemed advisable and in the best interests of its respective shareholders, this Agreement and the merger of Merger Sub with and into Cilion (the “ Merger ”).

WHEREAS, in connection with the Merger, all of the issued outstanding shares of Cilion’s (i) common stock, par value $0.001 per share (the “ Cilion Common Stock ” ); (ii) (a) Series A Preferred Stock, par value $0.001 per share (the “ Series A Preferred Stock ”), (b) Series B Preferred Stock, par value $0.001 per share (the “ Series B Preferred Stock ”), and (c) Series C Preferred Stock, par value $0.001 per share (the “ Series C Preferred Stock ” and together with the Series A Preferred Stock and Series B Preferred Stock, the “ Cilion Preferred Stock ”, and collectively with the Cilion Common Stock, the “ Cilion Capital Stock ”) at the Effective Time (as defined below) will be converted into the right to receive the Merger Consideration (as defined below) upon the terms and subject to the conditions of this Agreement;

WHEREAS, the respective Boards of Directors of Aemetis, Sub, Merger Sub and Cilion have each determined that the Merger and the other transactions contemplated hereby are consistent with, and in furtherance of, their respective long term business strategies and goals;

WHEREAS, promptly following the execution of this Agreement, in order to induce Aemetis, Sub and Merger Sub to enter into this Agreement, Cilion shall deliver to Aemetis an executed Action by Written Consent of the Securityholders (as defined below) in the form attached hereto as Exhibit A (the “ Executed Written Consent ”) adopting this Agreement, executed by the holders of at least (i) a majority of the outstanding shares of Cilion Common Stock, (ii) 66.67% of the outstanding shares of the Series A Preferred Stock and Series B Preferred Stock, voting together as a single class on an as-converted basis, and (iii) 60% of the outstanding shares of Series C Preferred Stock (collectively, the “ Requisite Securityholder Approval ”).

WHEREAS, Aemetis, Sub, Merger Sub and Cilion desire to make certain representations, warranties, covenants and agreements in connection with the Merger and also to prescribe various conditions to the Merger.

NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements contained in this Agreement, and subject to the conditions set forth herein, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

SECTION 1.1 Definitions . As used in this Agreement, the following terms shall have the following meanings:

“Accredited Investor” shall have the meaning set forth in Rule 501(a) of Regulation D promulgated under the Securities Act.

“Aemetis” has the meaning set forth in the introductory paragraph.

“Aemetis Balance Sheet” means the unaudited consolidated balance sheet of Aemetis as of March 31, 2012.

“Aemetis Balance Sheet Date” means March 31, 2012.

“Aemetis Common Stock” shall mean shares of common stock, $0.001 par value, of Aemetis.

“Aemetis Common Stock Recipient” and “Aemetis Common Stock Recipients” shall have the meanings set forth in Section 3.13.

“Aemetis Disclosure Schedule” has the meaning set forth in Section 4.2 of this Agreement.

“Affiliate” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with such Person provided that, for purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or by contract or otherwise.

“Agreement” has the meaning set forth in the introductory paragraph.

“Assignment of Proceeds Amount” shall mean a contractual amount equal to the sum of five million dollars ($5,000,000) plus interest at the rate of three percent (3%) per annum, compounded annually.

“Board Observer” has the meaning set forth in Section 5.6 of this Agreement.

“Business Day” shall mean any day on which commercial banks are open for business in San Francisco, California.

“Capital Expenditures” means expenditures by a Person made for the purchase, lease or acquisition of assets (other than current assets) required to be capitalized in accordance with GAAP.

“Cash Merger Consideration” shall mean an amount in cash equal to $16,500,000, plus (ii) an amount equal to the Closing Date Cash Balance, minus (i) an amount equal to the Closing Date Indebtedness minus (iii) the amount of any Transaction Expenses identified on the Closing Payment Schedule pursuant to Section 3.3, but only to the extent such Transaction Expenses are unpaid as indicated in the Closing Payment Schedule.

“CERCLA” has the meaning set forth in Section 4.1(l)(i).

“Certificates” has the meaning set forth in Section 3.5(b).

“Certificate of Merger” has the meaning set forth in Section 2.3.

“Change of Control” means with respect to Aemetis, if any of the following occurs after the Effective Date:

(a) any “person” or “group” (as such terms are defined below) is or becomes the “beneficial owner” (as defined below), directly or indirectly, of shares of capital stock or other interests (including partnership interests) of Aemetis then outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of the directors, managers or similar supervisory positions (“Voting Stock”) representing fifty percent (50%) or more of the total voting power of all outstanding classes of Voting Stock of Aemetis; or

(b) Aemetis enters into a merger, consolidation or similar transaction with another Person (whether or not such Party is the surviving entity) and as a result of such merger, consolidation or similar transaction (i) the Persons that beneficially owned, directly or indirectly, the shares of Voting Stock of Aemetis immediately prior to such transaction cease to beneficially own, directly or indirectly, shares of capital stock then outstanding and entitled (without regard to the occurrence of any contingency) to vote in the election of the directors (“Voting Stock”) of Aemetis representing at least a majority of the total voting power of all outstanding classes of Voting Stock of the surviving Person; or

(c) Aemetis sells or transfers to any Person (other than to a Subsidiary of Aemetis), directly or indirectly through a sale of stock or a merger or consolidation, the Cilion Facility.

“Cilion” has the meaning set forth in the introductory paragraph.

“Cilion 401(k) Plan” has the meaning set forth in Section 5.7.

“Cilion Balance Sheet” means the unaudited consolidated balance sheet of Cilion as of March 31, 2012.

“Cilion Balance Sheet Date” means March 31, 2012.

“Cilion Capital Stock” has the meaning set forth in the Recitals.

“Cilion Certificate of Incorporation” means Cilion’s Third Amended and Restated Certificate of Incorporation, as amended.

“Cilion Common Stock” has the meaning set forth in the Recitals.

“Cilion Disclosure Schedule” has the meaning set forth in Section 4.1.

“Cilion Facility” means that certain 55 mgy ethanol plant located at 4209 Jessup road, Keyes, California.

“Cilion Financial Statements” has the meaning set forth in Section 4.1(e).

“Cilion Options” has the meaning set forth in Section 4.1(b).

“Cilion Permits” has the meaning set forth in Section 4.1(d).

“Cilion Preferred Stock” has the meaning set forth in the Recitals.

“Cilion Subsidiary” shall mean each Subsidiary of Cilion.

“Cilion Warrants” has the meaning set forth in Section 4.1(b).

“Closing” has the meaning set forth in Section 2.2.

“Closing Date” has the meaning set forth in Section 2.2.

“Closing Date Balance Sheet” means a balance sheet of Cilion dated as of the Closing prepared consistently with prior practice on a consolidated basis.

“Closing Date Cash Balance” means the sum of all cash and cash equivalents of Cilion and any Cilion Subsidiary as of the Closing less the Securityholders’ Representative Fund, as reflected on the Closing Payment Schedule (as updated by Cilion as of the Closing).

“Closing Date Indebtedness” means Cilion’s Indebtedness outstanding as of immediately prior to the Closing and reflected on the Closing Payment Schedule, as updated by Cilion as of the Closing.

“Closing Date Preferred Per Share Consideration” means (i) with respect to each share of Series C Preferred Stock, an amount of cash and Closing Shares equal to the Series C Preferred Per Share Preference Amount and (ii) with respect to each share of Series B Preferred Stock and Series A Preferred Stock, (A) an amount of cash equal to the amount of cash that a holder of Series B Preferred Stock and Series A Preferred Stock would be entitled to receive on a pro rata basis for each such share pursuant to the Cilion Certificate of Incorporation upon a liquidation resulting in a distribution to the holders of Series B Preferred Stock and Series A Preferred Stock of an amount equal to the Cash Merger Consideration after payment of the Series C Preferred Per Share Preference Amount, (B) the number of Closing Shares equal to the amount of Closing Shares that a holder of Series B Preferred Stock and Series A Preferred Stock would be entitled to receive on a pro rata basis for each such share pursuant to the Cilion Certificate of Incorporation upon a liquidation resulting in a distribution to the holders of Series B Preferred Stock and Series A Preferred Stock of an amount equal to the Stock Merger Consideration.

“Closing Payment Schedule” has the meaning set forth in Section 3.3.

“Closing Shares” means 20,000,000 shares of Aemetis Common Stock (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization).

“Cobank Credit Agreement” means the Credit Agreement dated August 10, 2007 between Cilion as borrower and the lenders identified therein, CoBank as Administrative Agent and Co-Lead Arranger for the lenders, and Farm Credit Services of America, FLCA and Metropolitan Life Insurance Company as Co-Lead Arrangers for the lenders, as modified by a First Amendment to Credit Agreement dated March 31, 2008, Second Amendment to Credit Agreement dated October 8, 2008, and Third Amendment to Credit Agreement dated August 11, 2011 and as the same may be further amended, amended and restated, supplemented and otherwise modified from time to time.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Confidentiality Agreement” has the meaning set forth in Section 5.4.

“Contingent Merger Consideration” means the Assignment of Proceeds Amount.

“Contingent Per Share Consideration” means with respect to each share of Series B Preferred Stock and Series A Preferred Stock, an amount of cash equal to the amount of cash that a holder of Series B Preferred Stock and Series A Preferred Stock would be entitled to receive on a pro rata basis for each such share pursuant to the Cilion Certificate of Incorporation upon a liquidation resulting in a distribution to the holders of Series B Preferred Stock and Series A Preferred Stock of an amount equal to the Contingent Merger Consideration. For clarity, the holders of Series C Preferred Stock shall not be entitled to any Contingent Merger Consideration.

“DGCL” has the meaning set forth in Section 2.1.

“Debt Milestone” means when the total amount of principal and interest owed to Third Eye Capital or its Affiliates is less than one million dollars ($1,000,000) (whether by refinancing such debt with other third party debt or otherwise) pursuant to the following (i) the Note Purchase Agreement dated as of October 18, 2010, as amended, by and among Aemetis Advanced Fuels Keyes, Inc., a Delaware corporation, Third Eye Capital Corporation, an Ontario corporation, as agent, Third Eye Capital Credit Opportunities Fund – Insight Fund, Sprott Private Credit Fund L.P. and Sprott PC Trust, (ii) Term Loan, (iii) the Revolving Credit Facility, or (iv) any other obligation of Aemetis or any of its Subsidiaries pursuant to notes held by Third Eye Capital or its Affiliates.

“Dissenting Securityholder” has the meaning set forth in Section 3.2.

“Dissenting Shares” has the meaning set forth in Section 3.2.

“Drop Dead Date” has the meaning set forth in Section 7.1(e).

“Effective Time” has the meaning set forth in Section 2.3.

“Environmental Laws” has the meaning set forth in Section 4.1(l)(i).

“Equity Securities” means, collectively, equity securities, whether or not currently authorized, as well as rights, options, or warrants to purchase such equity securities, or securities of any type whatsoever that are, or may become, convertible or exchangeable into or exercisable for such equity securities.

“ERISA” has the meaning set forth in Section 4.1(n).

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

“Exchange Agent” has the meaning set forth in Section 3.4(a).

“Exchange Fund” has the meaning set forth in Section 3.5(a).

“Executed Written Consent” has the meaning set forth in the Recitals.

“Fair Market Value” shall mean the average closing price per share of Aemetis Common Stock for the thirty (30) consecutive trading days immediately preceding the Closing Date as reported by OTC Markets, or if there have been no published closing prices with respect to the Aemetis Common Stock on such date, Fair Market Value shall be the value established in good faith by Aemetis’ Board of Directors.

“Free Cash Flow” means, with reference to any period, the following, calculated in accordance with GAAP on a consolidated basis (without duplication) for such period: (i) the net income (or loss) of Aemetis and its Subsidiaries on a consolidated basis; plus (ii) amortization and depreciation expense, less (iii) the sum of payments made during such period for Capital Expenditures and payments of principal and interest made for any indebtedness for borrowed money. Notwithstanding anything herein to the contrary, there shall be excluded from consolidated net income any income (or loss) of any Subsidiary where the majority of its revenues are derived outside of the United States but any such income so excluded shall be included in such period or any later period to the extent of any cash dividends or distributions actually paid in the relevant period to Aemetis or any of its other Subsidiaries.

“GAAP” shall mean United States generally accepted accounting principles.

“Governmental Entity” shall mean any means any United States or non-United States federal, national, supranational, state, provincial, local or similar government, governmental, regulatory or administrative authority, branch, agency or commission or any court, tribunal, or arbitral or judicial body (including any grand jury).

“Hazardous Materials” has the meaning set forth in Section 4.1(l)(ii).

“Indebtedness” shall mean (i) any indebtedness for borrowed money or issued in substitution for or exchange of indebtedness for borrowed money, (ii) any indebtedness evidenced by any note, bond, debenture or other debt security, (iii) any indebtedness for the deferred purchase price of property or services with respect to which a Person is liable, contingently or otherwise, as obligor or otherwise (excluding trade payables and other current liabilities incurred in the ordinary course of business), (iv) contingent reimbursement obligations with respect to letters of credit, (v) any obligations for which a Person is obligated pursuant to a guaranty for a third party’s Indebtedness, (vi) any obligations under capitalized leases with respect to which a Person is liable, and (vii) any indebtedness secured by a lien on a Person’s assets.

“Intellectual Property Rights” means trade secrets, inventions, know-how, formulae and processes, patents (including all reissues, divisions, continuations and extensions thereof), patent applications, trademarks, trademark registrations, trademark applications, service marks, service mark registrations, service mark applications, copyright registrations and copyright applications.

“Keyes Lease” shall mean that certain Lease Agreement for Keyes, California Ethanol Production Facility, dated December 1, 2009, among the parties and certain affiliates thereof, and any amendments and extensions thereto, whereby Cilion, as landlord, leased the Cilion Facility to Aemetis, as tenant.

“Knowledge” of a particular fact or other matter with respect to an individual means (a) such individual has actual knowledge of such fact or other matter; and (b) a prudent individual would be expected to discover such fact or other matter in the course of conducting a reasonable inquiry concerning the general operations of such applicable Person. With respect to Cilion, “Knowledge” shall mean the Knowledge of Jeremy Wilhelm and Kevin Kruse.

“Lenders” has the meaning set forth in Section 7.2.

“Letter of Transmittal” has the meaning set forth in Section 3.5(b).

“Material Adverse Effect” with respect to any entity means any event, change or effect that is materially adverse to the financial condition or business of such entity and its Subsidiaries, taken as a whole, other than any such event, change or effect resulting from or arising in connection with (i) general industry-wide conditions; (ii) conditions generally affecting the economy, or financial or capital markets, in the United States or elsewhere in the world, including changes in interest or exchange rates or commodities prices; (iii) acts of war, sabotage or terrorism or any military action; (iv) this Agreement or the transactions contemplated hereby, including the announcement or pendency of such transactions; (v) changes in law or changes in general legal, regulatory or political conditions; or (vi) any change in accounting standards, requirements or principles; provided, that, in the case of (i) through (iii) and (v) through (vi), such event, change or action does not affect such entity in a substantially disproportionate manner as compared to similarly situated participants in the industry in which such entity and its Subsidiaries operate.

“Material Contract” means with respect to Cilion any contract, agreement or commitment to which Cilion or any Cilion Subsidiary is a party (i) with expected receipts or expenditures in excess of $5,000 in the aggregate over any 12 month period, (ii) requiring such party to indemnify any Person; (iii) granting any exclusive rights to any party or limiting or purporting to limit the ability of the such party to compete in any line of business or with any Person or in any geographic area or during any period of time; (iv) evidencing Indebtedness; (v) granting any party most favored nation pricing; (vi) involving a joint venture, partnership or similar arrangement or any material agency, distributorship or management agreement; (vii) relating to the employment of any officer or employee, including contracts and agreements regarding compensation, bonus payments and severance arrangements; (viii) under which such party has received a license to any third-party Intellectual Property Rights, excluding all "off-the-shelf software", (ix) pursuant to which such party is a lessor or lessee of any real property or any machinery, equipment, motor vehicles, office furniture, fixtures or other personal property involving in excess of $5,000 per annum, (x) (a) with any of its officers, directors, employees or stockholders or any member of their immediate families or (b) with any Person with whom Cilion or any Subsidiary does not deal at arm’s length; and (xi) any other contract or agreement that is material to such party. Material Contract with respect to Aemetis means any note, bond, mortgage, indenture, lease, license, contract, agreement or other consensual obligation that would be required to be filed by Aemetis as a material contract pursuant to Item 601(b)(10) of Regulation S-K of the SEC;

“Merger” has the meaning set forth in the Recitals.

“Merger Consideration” shall mean (i) the Cash Merger Consideration plus (ii) the Stock Merger Consideration plus (iii) the Contingent Merger Consideration.

“Merger Sub” has the meaning set forth in the introductory paragraph.

“Milestone Financing(s)” means the issuance or sale of Equity Securities by Aemetis or any of its Affiliates at an average per unit price in excess of $2.00 (subject to adjustment for any stock split, stock dividend, recapitalization, subdivision, reclassification, combination, exchange of shares or similar transaction with respect to the outstanding Aemetis Common Stock) and that results in at least $50,000,000 in gross cash proceeds, in the aggregate, in one or more transactions consummated at any time following the Effective Time, including without limitation, in connection with the issuance of any convertible indebtedness or other securities exercisable for or otherwise convertible into Equity Securities.

“Option Plan” has the meaning set forth in Section 4.1(b).

“Person” shall mean any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated entity or Governmental Entity.

“Post-Closing Tax Period” means any Tax period beginning after the Closing Date and that portion of any Straddle Period beginning after the Closing Date.

“Pre-Closing Tax Period” means any Tax period ending on or before the Closing Date and that portion of any Straddle Period ending on the Closing Date.

“Pro Rata Share” means, with respect to a particular holder of Cilion Preferred Stock, the amount of Cash Merger Consideration such holder is entitled to receive pursuant to Section 3.1(c) with respect to its Cilion Preferred Stock (other than Dissenting Shares) relative to the amount of Cash Merger Consideration all holders of Cilion Preferred Stock are entitled to receive pursuant to Section 3.1(c) with respect to their Cilion Preferred Stock (other than Dissenting Shares).

“Project Agreement” shall mean that certain Project Agreement, dated December 1, 2009, among the parties and certain affiliates thereof, and any amendments and extensions thereto.

“RCRA” has the meaning set forth in Section 4.1(l)(i).

“Representatives” shall mean officers, directors, partners, trustees, executors, employees, agents, attorneys, accountants and advisors.

“Requisite Securityholder Approval” shall have the meaning set forth in the Recitals.

“Revolving Credit Facility” means the revolving credit facility in the amount of $18,000,000 to be provided to Aemetis or a subsidiary of Aemetis through Third Eye Capital Corporation.

“SEC” means the Securities and Exchange Commission.

“Securities Act” shall mean the Securities Act of 1933, as amended.

“Securityholders” shall mean each Person that holds Cilion Capital Stock.

“Securityholder Documents” has the meaning set forth in Section 3.5(b).

“Securityholders’ Representative” has the meaning set forth in Section 8.1.

“Securityholders’ Representative Fund” has the meaning set forth in Section 8.2.

“Series C Preferred Per Amount” means, with respect to a share of Series C Preferred Stock, the sum of (a) $.0628, plus (b) the amount of accrued and unpaid dividends that have been declared and are payable in respect of such share of Series C Preferred Stock immediately prior to the Effective Time, if any.

“Stock Merger Consideration” means the Closing Shares.

“Stockholders Agreement” means the Stockholders Agreement between Aemetis and the Securityholders’ Representative, in the form of Exhibit B hereto.

“Straddle Periods” has the meaning set forth in Section 5.14(b).

“Subsidiary” means, with respect to any party, an entity in which such party directly or indirectly owns, beneficially or of record, at least 50% of the outstanding equity or financial interests of such entity.

“Surviving Corporation” has the meaning set forth in Section 2.1.

“Takeover Proposal” means (a) any acquisition or purchase of all or substantially all Cilion Capital Stock or the assets of Cilion or (b) any merger, consolidation, business combination, recapitalization, reorganization or other extraordinary business transaction involving or otherwise relating to Cilion.

“Tax(es)” means any and all federal, state and local taxes of any country, assessments and other governmental charges, duties, impositions and liabilities, including taxes based upon or measured by gross receipts, income, profits, sales, use and occupation, and value added, ad valorem, stamp transfer, franchise, withholding, payroll, recapture, employment, excise and property taxes, together with all interest, penalties and additions imposed with respect to such amounts and any obligations under any agreements or arrangements with any other Person with respect to such amounts and including any liability for taxes of a predecessor entity.

“Tax Returns” means any return, declaration, report, claim for refund, or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

“Term Loan” means the term loan in the principal amount of $15,000,000 to be provided to Aemetis or a Subsidiary of Aemetis by or through Third Eye Capital Corporation in connection with the transactions contemplated by this Agreement.

“Transaction Documents” means this Agreement, the Exchange Agent Agreement and the Stockholders Agreement.

“Transaction Expenses” shall mean the sum of all legal, accounting, investment banking, financial advisory and all other fees and expenses of third parties incurred by Cilion in connection with the negotiation, preparation, execution and effectuation of the Agreement, and the cost of the D&O Tail Policy defined in Section 5.9.

ARTICLE II

THE MERGER

SECTION 2.1 The Merger . Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with the Delaware General Corporation Law (the “ DGCL ”), Merger Sub shall be merged with and into Cilion at the Effective Time. Following the Effective Time, the separate corporate existence of Merger Sub shall cease and Cilion shall continue as the survivor in the Merger (the “ Surviving Corporation ”) and shall succeed to and assume all the rights and obligations of Merger Sub in accordance with the DGCL.

SECTION 2.2 Closing .

(a) The closing of the transactions contemplated hereby (the “ Closing ”) shall take place at 10:00 a.m. on such date or another date to be specified by the parties (the “ Closing Date ”), which shall be no later than the second Business Day after satisfaction (or, to the extent permitted by applicable law, waiver by the party or parties entitled to the benefits thereof) of the conditions set forth in Article VI (other than those conditions that by their terms are to be satisfied at the Closing, but subject to the satisfaction (or, to the extent permitted by applicable law, waiver by the party or parties entitled to the benefits thereof) of those conditions), at the offices of Aemetis, 20400 Stevens Creek Blvd., Suite 700, Cupertino, CA 95014, unless another time, date or place is agreed to by the parties hereto.

(b) At the Closing, (i) Aemetis, Sub and Merger Sub, as applicable, shall deliver (A) duly executed counterparts to the Transaction Documents to which it is a party, (B) the Merger Consideration in accordance with Section 3.1 and (C) the items set forth in Section 6.2 and (ii) Cilion shall deliver (A) duly executed counterparts to the Transaction Documents to which it is a party and (B) the items set forth in Section 6.3.

SECTION 2.3 Effective Time . Subject to the provisions of this Agreement, as soon as practicable on the Closing Date, the parties shall file a certificate of merger or other appropriate documents (in any such case, the “ Certificate of Merger ”) executed in accordance with the relevant provisions of the DGCL and, as soon as practicable on or after the Closing Date, shall make all other filings or recordings required under the DGCL. The Merger shall become effective at such time as the Certificate of Merger is duly filed with the Delaware Secretary of State or at such other time as Aemetis and Cilion shall agree and specify in the Certificate of Merger (the time the Merger becomes effective being hereinafter referred to as the “ Effective Time ”).

SECTION 2.4 Effects of the Merger . At the Effective Time, the effect of the Merger shall be as provided in this Agreement, the Certificate of Merger and the applicable provisions of the DGCL. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all the property, rights, privileges, powers and franchises of Cilion and Merger Sub shall vest in the Surviving Corporation, and all debts, liabilities and duties of Cilion and Merger Sub shall become the debts, liabilities and duties of the Surviving Corporation.

SECTION 2.5 Certificate of Incorporation; Bylaws .

(a) At the Effective Time, the Certificate of Incorporation of the Surviving Corporation shall be amended and restated in its entirety to read as the Certificate of Incorporation of Merger Sub as in effect immediately prior to the Effective Time; provided, however, that Article I of the Certificate of Incorporation of the Surviving Corporation shall be amended to read as follows: “The name of the corporation is Aemetis Facility Keyes, Inc.”

(b) The Bylaws of Merger Sub, as in effect immediately prior to the Effective Time, shall be the Bylaws of the Surviving Corporation until thereafter amended.

SECTION 2.6 Board of Directors of the Surviving Corporation . The directors and officers of Merger Sub immediately prior to the Effective Time shall be the directors and officers of the Surviving Corporation, until the earlier of their resignation or removal and until their respective successors are duly elected and qualified, as the case may be.

ARTICLE III

EFFECT OF THE MERGER

SECTION 3.1 Effect on Capital Stock . At the Effective Time, by virtue of the Merger and without any action on the part of the holder of any shares of Cilion Capital Stock or any shares of capital stock of Merger Sub:

(a) Capital Stock of Merger Sub . Each issued and outstanding share of capital stock of Merger Sub shall be automatically converted into and become one fully paid and nonassessable share of common stock, par value $.01 per share, of the Surviving Corporation.

(b) Cancellation of Treasury Stock and Aemetis-Owned Stock . Each share of Cilion Capital Stock, that is directly owned by Cilion, Merger Sub or Aemetis shall automatically be canceled and shall cease to be outstanding, and no consideration shall be delivered in exchange therefor.

(i) Series C Preferred Stock . Each share of Series C Preferred Stock issued and outstanding immediately prior to the Effective Time (excluding Dissenting Shares) shall be automatically converted into, subject to and in accordance with Section 3.5 , the right to receive an amount equal to the Closing Date Preferred Per Share Consideration

(ii) Series B Preferred Stock and Series A Preferred Stock . Each share of Series B Preferred Stock and Series A Preferred Stock issued and outstanding immediately prior to the Effective Time (excluding Dissenting Shares) shall be automatically converted into, subject to and in accordance with Section 3.5 , the right to receive (A) the Closing Date Preferred Per Share Consideration and (B) the Contingent Per Share Consideration. Notwithstanding the foregoing, if any holder of Series B Preferred Stock or Series A Preferred Stock shall not qualify as an Accredited Investor as of the Closing Date, then, in lieu of Stock Merger Consideration to which such holder would otherwise have been entitled had such holder been an Accredited Investor, such holder shall receive Cash Merger Consideration in an amount equal to the applicable portion of the Stock Merger Consideration valued at the Fair Market Value, and the aggregate Cash Merger Consideration and Stock Merger Consideration payable to the other holders of Cilion Preferred Stock shall be correspondingly adjusted.

(d) Cilion Common Stock . Each share of Cilion Common Stock issued and outstanding immediately prior to the Effective Time shall automatically be canceled and shall cease to be outstanding, and no consideration shall be delivered in exchange therefor.

(e) Cilion Stock Options . In connection with the Merger, each Cilion Option outstanding immediately prior to the Effective Time shall be cancelled, without any action on the part of the holder of such Cilion Option, as of the Effective Time and no consideration shall be paid to any holder of a Cilion Option as a result of such cancellation. Cilion shall take such actions as are necessary and appropriate to cause each Cilion Option to be cancelled as of the Effective Time for no consideration.

(f) Cilion Warrants . At the Effective Time, all Cilion Warrants shall have been cancelled and shall have ceased to exist, and no consideration shall have been paid to any holder of a Cilion Warrant as a result of such cancellation. Cilion shall take such actions as are necessary and appropriate to cause each Cilion Warrant to be cancelled as of the Effective Time for no consideration.

SECTION 3.2 Dissenters’ Rights . Notwithstanding any provision of this Agreement to the contrary, any shares of Cilion Capital Stock held by a Securityholder who has not voted in favor of the Merger or consented thereto in writing, and who has properly exercised and perfected such Securityholder’s right for appraisal of such shares in accordance with Section 262 of the DGCL and who, as of the Effective Time, has not effectively withdrawn or lost such right to appraisal (“ Dissenting Shares ”), if any, shall not be converted into the right to receive the respective portion of the Merger Consideration but shall instead be converted into the right to receive such consideration as may be determined to be due with respect to such Dissenting Shares pursuant to the DGCL. Cilion shall give Aemetis prompt notice of any demand received by Cilion for appraisal of any shares of Cilion Capital Stock, and Aemetis shall have the right to direct and participate in all negotiations and proceedings with respect to such demand. Cilion agrees that, except with the prior written consent of Aemetis, or as required under the DGCL, it will not voluntarily make any payment with respect to, or settle or offer to settle, any such demand. Each holder of Dissenting Shares (“ Dissenting Securityholder ”) who, pursuant to the provisions of the DGCL, becomes entitled to payment of the fair value for shares of Cilion Capital Stock shall receive payment therefore (but only after the value therefore shall have been agreed upon or finally determined pursuant to such provisions). If, after the Effective Time, any Dissenting Securityholder shall effectively withdraw or lose (through failure to perfect or otherwise) such Dissenting Securityholder’s appraisal rights under Section 262 of the DGCL then, as of the later of the Effective Time and the occurrence of such event, such Dissenting Securityholder’s shares shall automatically be converted into and represent only the right to receive the Merger Consideration for such shares set forth in Section 3.1(c), as applicable, without interest, upon surrender of the certificate representing such shares. Any amounts that become payable in respect of Dissenting Shares shall be satisfied first from the Exchange Fund up to the applicable Merger Consideration that would have been otherwise payable in respect of such Dissenting Share at the Closing if such Dissenting Share were not a Dissenting Share, and thereafter from Aemetis.

SECTION 3.3 Closing Payment Schedule . At the Closing, Cilion shall deliver to Aemetis a definitive closing payment schedule (the “ Closing Payment Schedule ”) certified by the President of Cilion (solely in his capacity as such) and accurately setting forth: (i) the name of each Securityholder of Cilion immediately prior to the Effective Time; (ii) the number of shares of Cilion Capital Stock held by each such Securityholder immediately prior to the Effective Time; (iii) the aggregate Merger Consideration which each Securityholder is eligible to receive, including the allocation of Cash Merger Consideration, Stock Merger Consideration and Contingent Merger Consideration for each such holder; (iv) each Securityholder’s status as an Accredited Investor based upon completion of an Accredited Investor Questionnaire (to the extent completed by such Securityholder and submitted to Cilion); (v) the Closing Date Cash Balance; and (vi) the Closing Date Indebtedness. The Closing Payment Schedule shall be subject to update by the Securityholders’ Representative from time to time after the Closing to reflect any Dissenting Shares and any corresponding changes (neither such updates nor the information updated shall be deemed inaccuracies in the Closing Payment Schedule).

SECTION 3.4 Assignment of Proceeds .

(a) Payment Upon Milestone Financing(s) . Within three (3) Business Days following the satisfaction of the Milestone Financing(s), Aemetis shall pay in cash an amount equal to the Contingent Merger Consideration to the holders of Series A Preferred Stock and Series B Preferred Stock in accordance with the Closing Payment Schedule. Aemetis covenants and agrees that it shall, and it shall cause its Affiliates to, not take any action, or fail to take any action, with the intent of circumventing the purpose of Section 3.4(a). Notwithstanding the foregoing, in the event Aemetis or any of its Subsidiaries issues or sells Equity Securities that results in at least $50,000,000 in gross cash proceeds, in the aggregate (whether in one transaction or multiple transactions), but the average issue price is less than $2.00 per share (subject to adjustment for any stock split, stock dividend, recapitalization, subdivision, reclassification, combination, exchange of shares or similar transaction with respect to the outstanding Aemetis Common Stock), then on the fifteenth Business Day of the first calendar month immediately following the date Aemetis or any of its Subsidiaries raises at least fifty million dollars ($50,000,000) in gross cash proceeds and on the fifteenth Business Day of each calendar month thereafter until the Contingent Merger Consideration is paid in full, Aemetis shall pay in cash an amount an amount equal to 0.25 times the Free Cash Flow of the prior calendar month to the holders of Series A Preferred Stock and Series B Preferred Stock in accordance with the Closing Payment Schedule; provided the foregoing shall not limit in any way the obligation to pay in full the Contingent Merger Consideration once the Milestone Financing has been achieved.

(b) Payment Upon Milestone Debt Payoff . On the fifteenth Business Day of the first calendar month immediately following the satisfaction of the Debt Milestone and on the fifteenth Business Day of each calendar month thereafter until the Contingent Merger Consideration is paid in full, Aemetis shall pay in cash an amount equal to 0.25 times the Free Cash Flow of the prior calendar month to the holders of Series A Preferred Stock and Series B Preferred Stock in accordance with the Closing Payment Schedule; provided the foregoing shall not limit in any way the obligation to pay in full the Contingent Merger Consideration once the Milestone Financing has been achieved. Aemetis covenants and agrees that it shall, and it shall cause its Affiliates to, not take any action, or fail to take any action, with the intent of circumventing the purpose of Section 3.4(b).

(c) Change of Control Upon the occurrence of a Change of Control, and after payment or assumption by the acquiror of all Indebtedness of Aemetis, but prior to the payment to any holders of Equity Securities of Aemetis, (i) Aemetis shall pay in cash an amount equal to the Contingent Merger Consideration to the holders of Series A Preferred Stock and Series B Preferred Stock in accordance with the Closing Payment Schedule.

(d) Audit . Upon the written request of the Securityholders’ Representative, Aemetis shall permit the Securityholders’ Representative and its Representatives to have access during normal business hours to the financial records of Aemetis as may be reasonably necessary to verify the compliance with this Section 3.4. The Securityholders’ Representative may at any time deliver to Aemetis a written statement describing its objections to determination with respect to the satisfaction of any milestone set forth above. If the Securityholders’ Representative raises any such questions or objections that cannot be resolved through the good faith negotiation of Aemetis and the Securityholders’ Representative within thirty (30) calendar days after the delivery of notice of such objections to Aemetis, then each party may pursue any legal remedies available to such party hereunder subject to the terms and conditions of this Agreement.

(e) Unclaimed Payments . Neither Aemetis nor the Exchange Agent shall be liable to any person in respect of the Contingent Merger Consideration delivered to a public official pursuant to any applicable abandoned property, escheat or similar Law. If any portion of the Contingent Merger Consideration made by Aemetis remains unclaimed by a holder as of the date that is one year after the Milestone Payment Date (or immediately prior to such earlier date on which the Contingent Merger Consideration would otherwise escheat to or become the property of any Governmental Entity), despite the Exchange Agent’s commercially reasonable efforts to deliver the payment to a holder, any such Contingent Merger Consideration shall be delivered to Aemetis upon demand, and any such holder shall thereafter look only to Aemetis for satisfaction of such holder’s claims for the Contingent Merger Consideration.

(f) No Voting, Dividends or Interest; No Equity or Ownership Interest in Aemetis . A holder’s right to the Assignment of Proceeds Amount shall not give such holder any voting or dividend rights, or represent any equity or ownership interest in Aemetis, Merger Sub or Cilion.

SECTION 3.5 Exchange of Certificates .

(a) Exchange Agent . Prior to the Effective Time, Aemetis and Securityholders’ Representative shall enter into an exchange agent agreement with CSC Trust Co. (the “ Exchange Agent ”) in the form attached hereto as Exhibit C (the “ Exchange Agreement ”), which shall provide that Aemetis shall deposit with the Exchange Agent as of the Effective Time, for the benefit of the Securityholders, for exchange in accordance with this Article III, through the Exchange Agent, certificates and cash representing the Cash Merger Consideration and Stock Merger Consideration issuable pursuant to Section 3.1 in exchange for outstanding shares of Cilion Preferred Stock. All shares of Aemetis Common Stock and cash deposited with the Exchange Agent pursuant to this Section 3.4(a) shall hereinafter be referred to as the “ Exchange Fund ”. In accordance with the terms of the Exchange Agreement, the Exchange Agent shall deliver Cash Merger Consideration and Stock Merger Consideration contemplated to be issued pursuant to this Section 3.4(a) out of the Exchange Fund. Except as otherwise contemplated herein, the Exchange Fund shall not be used for any other purpose.

(b) Exchange Procedures . Promptly following the Effective Time, but in any event not more than seven (7) Business Days after the Closing Date, Aemetis or Exchange Agent, as applicable, shall mail or otherwise deliver to each holder of record of Cilion Capital Stock, whose shares were converted into the right to receive the Merger Consideration pursuant to Section 3.1, (a) a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Certificates (defined below) shall pass, only upon receipt of the Certificates by the Exchange Agent) in the form attached hereto as Exhibit D , and which letter of transmittal shall also require each holder of record of Cilion Capital Stock, as a condition to its right to receive the Merger Consideration pursuant to Section 3.1, to execute and deliver with such letter of transmittal (1) a release of Cilion and its Subsidiaries, Affiliates and Representatives, (2) and an acknowledgement of the accuracy of the Merger Consideration to be received by such holder (the “ Letter of Transmittal ”); (b) such other customary documents as may be required by the Exchange Agent pursuant to such instructions; and (c) instructions for use in effecting the surrender of the certificate or certificates that represent outstanding shares of Cilion Capital Stock (the “ Certificates ”, and together with items (a), (b) and (c), the “ Securityholder Documents ”) in exchange for the such holder’s respective portion of the Merger Consideration as described in Section 3.1(a). Upon surrender of a Certificate for cancellation to the Exchange Agent, together with the Securityholder Documents, duly completed and validly executed in accordance with the instructions thereto, the holder of such Certificate shall be entitled to receive in exchange therefore the applicable Merger Consideration as described in Section 3.1. The Certificate so surrendered shall forthwith be canceled. Until so surrendered, each outstanding Certificate that prior to the Effective Time represented shares of Cilion Capital Stock will be deemed from and after the Effective Time, for all corporate purposes other than the payment of dividends, to evidence the right to receive the portion of the Merger Consideration which shall be issued for such Cilion Capital Stock.

(c) Distributions with Respect to Unsurrendered Certificates . Whenever a dividend or other distribution is declared or made after the date hereof with respect to Aemetis Common Stock with a record date after the Effective Time, such declaration shall include a dividend or other distribution in respect of all shares of Aemetis Common Stock issuable pursuant to this Agreement. Any dividends or other distributions with respect to Aemetis Common Stock with a record date after the Effective Time shall be paid to the holder of any unsurrendered Certificate with respect to the shares of Aemetis Common Stock represented thereby, and any cash payment in lieu of fractional shares of Aemetis Common Stock shall be paid to any such holder pursuant to Section 3.6 only upon the surrender of such Certificate by the holder of record of such Certificate in accordance with this Article III. Subject to the effect of applicable escheat or similar laws, following surrender of any such Certificate there shall be paid to the holder of the certificate representing whole shares of Aemetis Common Stock, issued in exchange therefor, without interest, (i) at the time of such surrender, the amount of dividends or other distributions with a record date after the Effective Time theretofore paid with respect to such whole shares of Aemetis Common Stock and the amount of any cash payable in lieu of a fractional share of Aemetis Common Stock to which such holder is entitled pursuant to Section 3.6 and (ii) at the appropriate payment date, the amount of dividends or other distributions with a record date after the Effective Time but prior to such surrender and with a payment date subsequent to such surrender payable with respect to such whole shares of Aemetis Common Stock.

SECTION 3.6 No Further Ownership Rights in Cilion Capital Stock . All Closing Shares and Cash Merger Consideration issued upon the surrender for exchange of Certificates in accordance with the terms of this Article III shall be deemed to have been issued (and paid) in full satisfaction of all rights pertaining to the shares of Cilion Capital Stock previously represented by such Certificates, subject, however, to the Surviving Corporation’s obligation to pay any dividends or make any other distributions with a record date prior to the Effective Time which may have been declared or made by Cilion on such shares of Cilion Capital Stock, which remain unpaid at the Effective Time, and there shall be no further registration of transfers on the share transfer books of the Surviving Corporation of the shares of Cilion Capital Stock which were outstanding immediately prior to the Effective Time. If, after the Effective Time, Certificates are presented to the Surviving Corporation or the Exchange Agent for any reason, they shall be canceled and exchanged as provided in this Article III.

SECTION 3.7 No Fractional Shares .

(a) No certificates or scrip representing fractional shares of Aemetis Common Stock shall be issued upon the surrender for exchange of Certificates (or in the case of a lost, stolen or destroyed Certificate, upon delivery of an affidavit in the manner provided in Section 3.1(i)), no dividends or other distributions of Aemetis shall relate to such fractional share interests and such fractional share interests will not entitle the owner thereof to vote or to any rights of a shareholder of Aemetis.

(b) In lieu of such fractional share interests, Aemetis shall pay to each holder of a Certificate an amount in cash equal to the product obtained by multiplying (A) the fractional share interest to which such holder (after taking into account all shares of Cilion Capital Stock formerly represented by all Certificates surrendered by such holder) would otherwise be entitled by (B) the Fair Market Value of one share of Aemetis Common Stock.

SECTION 3.8 Anti-Dilution Provisions . In the event Aemetis changes (or establishes a record date for changing) the number of shares of Aemetis Common Stock issued and outstanding prior to the Effective Time as a result of a stock split, stock dividend, recapitalization, subdivision, reclassification, combination, exchange of shares or similar transaction with respect to the outstanding Aemetis Common Stock and the record date therefor shall be prior to the Effective Time, the Stock Merger Consideration and the Termination Fee shall be proportionately adjusted to reflect such stock split, stock dividend, recapitalization, subdivision, reclassification, combination, exchange of shares or similar transaction.

SECTION 3.9 Unclaimed Exchange Fund . Any portion of the Cash Merger Consideration and Stock Merger Consideration that remains undistributed to the holders of the Certificates for twelve months after the Effective Time shall be delivered to Aemetis, upon demand, and any holders of the Certificates who have not theretofore complied with this Article III shall thereafter look only to Aemetis for, and Aemetis shall remain liable for, payment of their claim for the applicable Merger Consideration, any dividends or other distributions payable pursuant to Section 3.1 and cash in lieu of any fractional shares payable pursuant to Section 3.7 in accordance with this Article III.

SECTION 3.10 No Liability . None of Aemetis, Sub, Merger Sub, Cilion, the Surviving Corporation or the Exchange Agent shall be liable to any person in respect of any shares of Aemetis Common Stock, cash, dividends or other distributions from the Exchange Fund properly delivered to a public official pursuant to any applicable abandoned property, escheat or similar law. If any Certificate shall not have been surrendered prior to four years after the Effective Time (or immediately prior to such earlier date on which any Cash Merger Consideration and Stock Merger Consideration (and any dividends or other distributions payable with respect thereto pursuant to Section 3.5(c) and Section 3.8 and cash in lieu of any fractional shares payable with respect thereto pursuant to Section 3.7) would otherwise escheat to or become the property of any Governmental Entity), any such Cash Merger Consideration and Stock Merger Consideration (and any dividends or other distributions payable with respect thereto pursuant to Section 3.5(c) and cash in lieu of any fractional shares payable with respect thereto pursuant to Section 3.7) shall, to the extent permitted by applicable law, become the property of Aemetis, free and clear of all claims or interest of any person previously entitled thereto.

SECTION 3.11 Lost, Stolen or Destroyed Certificates . If any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming such Certificate to be lost, stolen or destroyed, the Exchange Agent shall deliver in exchange for such lost, stolen or destroyed Certificate the Merger Consideration, any dividends or other distributions payable pursuant to Section 3.4(c) and cash in lieu of any fractional shares payable pursuant to Section 3.6, in each case pursuant to this Article III.

SECTION 3.12 Withholding Rights . Aemetis, the Surviving Corporation or the Exchange Agent shall be entitled, but only with the prior consultation of the Securityholders’ Representative, to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any holder of Certificates such amounts as Aemetis, the Surviving Corporation or the Exchange Agent is required to deduct and withhold with respect to the making of such payment under the Code, or any provision of state, local or foreign tax law. To the extent that amounts are so withheld and paid over to the appropriate taxing authority by Aemetis, the Surviving Corporation or the Exchange Agent, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the holder of Certificates in respect of which such deduction and withholding was made by Aemetis, the Surviving Corporation or the Exchange Agent.

SECTION 3.13 Aemetis Common Stock Legend . The holders of Cilion Capital Stock receiving Aemetis Common Stock as set forth on the Closing Payment Schedule shall individually be referred to as an “ Aemetis Common Stock Recipient ” or collectively as the “ Aemetis Common Stock Recipients .” Until the resale by the Aemetis Common Stock Recipients of their Aemetis Common Stock has become registered under the Securities Act, or otherwise transferable pursuant to an exemption from such registration otherwise required thereunder, the Aemetis Common Stock issued to the Aemetis Common Stock Recipients hereunder shall be characterized as “restricted securities” under the Securities Act and, if certificated, shall bear the following legend:

“THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES ONLY, AND THE RESALE OF SUCH SHARES HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. SUCH SHARES MAY NOT BE RESOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION WITHOUT AN EXEMPTION UNDER THE SECURITIES ACT.”

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

SECTION 4.1 Representations and Warranties of Cilion . Subject to Section 8.10 below, Cilion represents and warrants to Aemetis, Sub and Merger Sub that the statements contained in this Section 4.1 are true and correct, except as disclosed in a document of even date herewith and delivered by Cilion to Aemetis on the date hereof referring to the representations and warranties in this Agreement (the “ Cilion Disclosure Schedule ”).

(a) Organization, Standing and Corporate Power . Cilion is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is organized and has the requisite corporate or other power and authority, as the case may be, to carry on its business as now being conducted. Cilion is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership, leasing or operation of its properties makes such qualification or licensing necessary, except for those jurisdictions in which the failure to be so qualified or licensed or to be in good standing, individually or in the aggregate, has not had and is not reasonably likely to have a Material Adverse Effect on Cilion. Cilion has delivered to Aemetis a true and correct copy of the Certificate of Incorporation of Cilion (the “ Cilion Certificate of Incorporation ”), Bylaws or other charter documents, as applicable, of Cilion, each as amended to date, and each of which are in full force and effect. Except as set forth on Section 4.1(a) of the Cilion Disclosure Schedule, Cilion does not have any Subsidiaries, and Cilion does not directly or indirectly own any equity or similar interest in, or any interest convertible or exchangeable or exercisable for, any equity or similar interest in, any corporation, partnership, joint venture or other business association or entity.

(b) Capital Structure .

(i) The authorized Cilion Capital Stock consists of: (1) 216,128,597 shares of Cilion Common Stock and (2) 197,838,597 shares of Cilion Preferred Stock, consisting of 40,000,000 shares of Series A Preferred Stock, 31,120,060 shares of Series B Preferred Stock and 127,718,537 shares of Series C Preferred Stock. As of the date hereof, (i) 11,025,100 shares of Cilion Common Stock were issued and outstanding; (ii) 40,000,000 shares of Series A Preferred Stock were issued and outstanding, 28,685,778 shares of Series B Preferred Stock were issued and outstanding and 127,718,537 shares of Series C Preferred Stock were issued and outstanding; and (iii) no shares of Cilion Common Stock were held by Cilion in its treasury. There are 8,940,000 shares of Cilion Common Stock reserved for issuance under Cilion, Inc. 2006 Stock Option / Stock Issuance Plan (the “ Option Plan ”), of which none are subject to outstanding options under the Option Plan (collectively, the “ Cilion Options ”). Except for the Option Plan, no other Cilion stock option plan or other equity based compensation plan is currently in effect, and there are no shares of Cilion Capital Stock, reserved for issuance under any other equity based compensation plan. There are 1,434,282 shares of Series B Preferred Stock reserved for issuance upon the exercise of outstanding warrants (the “ Cilion Warrants ”). Cilion has delivered to Aemetis true and correct copies of the Cilion Warrants. Except as set forth in Section 4.1(b) of the Cilion Disclosure Schedule and for the rights created pursuant to this Agreement and the rights disclosed in the preceding sentences, there are no other options, warrants, restricted stock awards, calls, rights, commitments or agreements of any character to which Cilion is a party or by which it is bound, obligating Cilion to issue, deliver, sell, repurchase or redeem or cause to be issued, delivered, sold, repurchased or redeemed, any shares of Cilion Capital Stock or obligating Cilion to grant, extend, accelerate the vesting of, change the price of, or otherwise amend or enter into any such option, warrant, call, right, commitment or agreement. Except as set forth in Section 4.1(b) of the Cilion Disclosure Schedule, there are no other contracts, commitments or agreements relating to voting, purchase or sale of Cilion Capital Stock (A) between or among Cilion and any of its Securityholders; and (B) to Cilion’s Knowledge, between or among any of the Securityholders. All shares of outstanding Cilion Capital Stock and rights to acquire Cilion Capital Stock were issued in compliance with all applicable federal and state securities laws.

(ii) With respect to each Securityholder, Section 4.1(b) of the Cilion Disclosure Schedule sets forth the number, class and series of shares of Cilion Capital Stock that each Securityholder holds of record, and the address and state of residence of such Securityholder. All of the information contained in the Closing Payment Schedule is accurate and complete immediately prior to the Effective Time, and, except as set forth on the Closing Payment Schedule, no other holder of Cilion Capital Stock or options, warrants or other rights convertible into Cilion Capital Stock shall have any right, title or claim to any Merger Consideration. The allocation of the Merger Consideration as set forth in the Closing Payment Schedule complies and is in accordance, in all material respects, with Cilion’s Certificate of Incorporation and the DGCL.

(iii) Except as set forth in Section 4.1(b)(iii) of the Cilion Disclosure Schedule: (A) none of the outstanding shares of Cilion Capital Stock are entitled or subject to any preemptive right, right of participation, right of maintenance or similar right; (B) other than the rights created pursuant to this Agreement, none of the outstanding shares of Cilion Capital Stock are subject to any right of repurchase or first refusal or similar right in favor of Cilion or any third party; and (C) there are no agreements or arrangements (other than this Agreement) restricting any holder from purchasing, selling, pledging or otherwise disposing of (or granting any option or similar right with respect to), any shares of Cilion Capital Stock.

(i) Cilion has all requisite corporate power and authority to enter into this Agreement and subject to adoption by Cilion’s stockholders of this Agreement and approval by Cilion’s stockholders of the Merger, to consummate the transactions contemplated hereby. Assuming the receipt of the Requisite Securityholder Approval, the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action on the part of Cilion, and, other than the Requisite Securityholder Approval, no other corporate action on the part of the Cilion or Cilion Stockholders is necessary to authorize this Agreement or the transactions contemplated hereby or to consummate the Merger.

(ii) The Requisite Securityholder Approval is the only approval necessary of the holders of Cilion Capital Stock to adopt this Agreement and the transactions contemplated hereby, and no other vote or consent of the holders of Cilion Capital Stock is necessary under the DGCL. The Board of Directors of Cilion has (A) approved this Agreement and the Merger and (B) submitted the Agreement to the stockholders of Cilion and recommended that the stockholders adopt the Agreement. This Agreement has been duly executed and delivered by Cilion and constitutes the valid and binding obligation of Cilion enforceable against Cilion in accordance with its terms, except that such enforceability may be limited by bankruptcy, insolvency, moratorium or other similar laws affecting or relating to creditors’ rights generally, and is subject to general principles of equity.

(iii) The execution and delivery of this Agreement by Cilion does not, and the consummation of the transactions contemplated hereby will not, conflict with, or result in any violation of, or default under (with or without notice or lapse of time, or both), or give rise to a right of termination, cancellation or acceleration of any obligation or loss of any benefit under (A) any provision of the Cilion Certificate of Incorporation or Bylaws of Cilion, as amended, or the charter documents of any Cilion Subsidiary, as amended; or (B) except as set forth in Section 4.1(c) of the Cilion Disclosure Schedule, any Material Contract, (C) the Cilion Permits (as hereinafter defined), or (D) any statute, law, ordinance, rule or regulation applicable to Cilion or its business or any Cilion Subsidiary, in the cases of subsections (B), (C) and (D), that would have or would be reasonably expected to have a Material Adverse Effect on Cilion.

(iv) Except as set forth in Section 4.1(c)(iv) of the Cilion Disclosure Schedule, no material consent, approval, order or authorization of, or registration, declaration or filing with, any Governmental Entity is required by or with respect to Cilion or any Cilion Subsidiary in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby, except for the filing of the Certificate of Merger, as provided in Section 2.3.

(d) Compliance with Applicable Laws . Cilion holds all permits, licenses, variances, exemptions, orders, registrations and approvals of all Governmental Entities (the “ Cilion Permits ”) which are required for it to own the Cilion Facility. Cilion is in compliance with the terms of the Cilion Permits and all applicable statutes, laws, ordinances, rules and regulations. No action, demand, requirement or investigation by any Governmental Entity and no suit, action or proceeding by any person, in each case with respect to Cilion or any of its properties is pending or, to the Knowledge of Cilion, threatened and, there are no facts or circumstances that exist that could reasonably be expected to result in any such action, demand, requirement or investigation. This Section 4.1(d) does not relate to matters with respect to Environmental Laws, which are the subject of Section 4.1(l), and Taxes, which are the subject of Section 4.1(m).

(e) Financial Statements .

(i) Except as set forth on Section 4.1(e) of the Cilion Disclosure Schedule, Cilion has delivered to Aemetis the audited financial statements of Cilion for the fiscal years ended December 31, 2008, 2009, 2010 and 2011, and the unaudited financial statements (consolidated balance sheet, consolidated statement of operations and consolidated statement of cash flows) of Cilion on a consolidated basis as at and for the fiscal period ended March 31, 2012 (collectively, the “ Cilion Financial Statements ”). The Cilion Financial Statements have been prepared in accordance with GAAP (except that the unaudited financial statements do not contain footnotes and are subject to normal recurring year-end audit adjustments, the effect of which is not expected in the aggregate to have a Material Adverse Effect with respect to Cilion) applied on a consistent basis throughout the periods presented. The Cilion Financial Statements fairly present, in all material respects, the consolidated financial position of Cilion and the results of its operations and cash flows, as of the dates and for the periods indicated therein, in conformity with GAAP, subject to year-end audit adjustments and the absence of footnotes in the case of the unaudited Cilion Financial Statements.

(f) To the Knowledge of Cilion, there are no circumstances that would require Cilion to restate any of the Cilion Financial Statements. Cilion has not had any material dispute with any of its auditors regarding accounting matters or policies during any of its past three (3) full fiscal years or during the current fiscal year to the date hereof. Neither Cilion nor any Cilion Subsidiary has any material obligations or liabilities of a type required to be reflected on a balance sheet prepared in accordance with GAAP, other than those obligations, liabilities or commitments (i) adequately provided for in the Cilion Balance Sheet, and (ii) incurred in the ordinary course of business since the Cilion Balance Sheet Date.

(g) Litigation .

(i) There is no action, suit, proceeding, claim, arbitration or investigation, pending before any Governmental Entity, foreign or domestic of which Cilion or any Cilion Subsidiary has received written notice, or, to Cilion’s Knowledge, is otherwise threatened against Cilion or any Cilion Subsidiary, any of its properties or any of their respective officers or directors (in their capacities as such).

(ii) There is no judgment, decree or order against Cilion or any Cilion Subsidiary or, to Cilion’s Knowledge, any of their respective directors or officers (in their capacities as such), that (A) restricts in any manner the use, transfer or licensing of any Cilion Proprietary Rights; (B) would prevent, enjoin, or materially alter or delay any of the transactions contemplated by this Agreement; or (C) that would reasonably be expected to have a Material Adverse Effect on Cilion.

(h) Restrictions on Business Activities . Except as set forth in Section 4.1(h) of the Cilion Disclosure Schedule, there is no agreement, judgment, injunction, order or decree binding upon Cilion or any Cilion Subsidiary that has or would reasonably be expected to have the effect of prohibiting or materially impairing any current business practice of Cilion or any Cilion Subsidiary, any acquisition of property by Cilion or any Cilion Subsidiary or the conduct of business by Cilion or any Cilion Subsidiary as currently conducted by Cilion or any Cilion Subsidiary, as the case may be.

(i) Material Contracts .

(i) All of the Material Contracts of Cilion and each Cilion Subsidiary are listed in Section 4.1(i) of the Cilion Disclosure Schedule and a true, correct and complete copy of each such Material Contract has been provided to Aemetis. With respect to each Material Contract: (A) the Material Contract is legal, valid, binding and enforceable and in full force and effect with respect to Cilion and each Cilion Subsidiary, as applicable, and, to Cilion’s Knowledge, is legal, valid, binding, enforceable and in full force and effect with respect to each other party thereto, in either case subject to the effect of bankruptcy, insolvency, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and except as the availability of equitable remedies may be limited by general principles of equity; and (B) neither Cilion or any Cilion Subsidiary nor, to Cilion’s Knowledge, any other party is in breach or default, and, no event has occurred that with notice or lapse of time would constitute a breach or default by Cilion or any Cilion Subsidiary or, to Cilion’s Knowledge, by any such other party, or permit termination, modification or acceleration, under such Material Contract. Neither Cilion nor any of its Subsidiaries has received any written notice or other written communication regarding any actual or possible violation or breach of, default under, or intention to terminate, cancel, modify or not renew any Material Contract.

(ii) Except for the consents set forth in Section 4.1(i)(ii) of the Cilion Disclosure Schedule, no prior consent of any party to a Material Contract is required for the consummation by Cilion of the transactions contemplated hereby to be in compliance with the provisions of such Material Contract or to avoid the termination of, the loss of any right under or the incurrence of any obligation under, such Material Contract.

(j) Real Estate . Other than the Cilion Facility, neither Cilion nor any Cilion Subsidiary owns or leases any real property. Section 4.1(j) of the Cilion Disclosure Schedule sets forth (i) all real property previously owned by Cilion or any Cilion Subsidiary at any time since inception, (ii) all leases for real property (each a “Lease” and collectively, “Leases”) to which Cilion or any Cilion Subsidiary is a party, all of which are in full force and effect and are valid, binding and enforceable in accordance with their respective terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium or other similar laws affecting or relating to creditors’ rights generally; and general principles of equity, regardless of whether asserted in a proceeding in equity or at law. True and correct copies or a true and correct description of all such Leases have been provided or made available to Aemetis. Cilion and each Cilion Subsidiary have paid all rents and service charges to the extent such rents and charges are due and payable under the Leases. Section 4.1(j) of the Cilion Disclosure Schedule also identifies any written or oral notices of which Cilion has Knowledge, of defaults by Cilion or any Subsidiary of Cilion with respect to any Lease.

(k) Title to Property . Except as set forth on Section 4.1(k) of the Cilion Disclosure Schedule, Cilion and each Cilion Subsidiary have good and marketable title to all of their respective personal property and assets reflected in the Cilion Balance Sheet or acquired after the Cilion Balance Sheet Date (except equipment, equity securities of third parties, interests in properties and other assets sold or otherwise disposed of since the Cilion Balance Sheet Date including, without limitation, pursuant to Section 5.1), or with respect to leased properties and assets, valid leasehold interests therein, free and clear of any mortgages, liens, pledges, charges or encumbrances of any kind or character, except (i) the lien of current taxes not yet due and payable; (ii) such imperfections of title, liens and easements as do not and will not materially impair the use of the properties subject thereto or affected thereby, or otherwise materially impair business operations involving such properties; (iii) liens securing debt that is reflected on the Cilion Balance Sheet; and (iv) such other mortgages, liens, pledges, charges or encumbrances as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on Cilion.

(l) Environmental Matters . The following terms shall be defined as follows:

(i) “ Environmental Laws ” shall mean any applicable foreign, federal, state or local governmental laws (including common laws), statutes, ordinances, codes, regulations, rules, policies, permits, licenses, certificates, approvals, judgments, decrees, orders, directives, or requirements that pertain to the protection of the environment, protection of public health and safety, or that pertain to the handling, use, manufacturing, processing, storage, treatment, transportation, discharge, release, emission, disposal, re-use, recycling, or other contact or involvement with Hazardous Materials (as defined in Section 3.18(a)(ii)), including, without limitation, the federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Section 9601, et seq., as amended (“ CERCLA ”), and the federal Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., as amended (“ RCRA ”).

(ii) “ Hazardous Materials ” shall mean any material, chemical, compound, substance, mixture or by-product that is identified, defined, designated, listed, restricted or otherwise regulated under Environmental Laws as a “hazardous constituent,” “hazardous substance,” “hazardous material,” “acutely hazardous material,” “extremely hazardous material,” “hazardous waste,” “hazardous waste constituent,” “acutely hazardous waste,” “extremely hazardous waste,” “infectious waste,” “medical waste,” “biomedical waste,” “pollutant,” “toxic pollutant,” “contaminant” or any other formulation or terminology intended to classify or identify substances, constituents, materials or wastes by reason of properties that are deleterious to the environment, natural resources, worker health and safety, or public health and safety, including without limitation ignitability, corrosivity, reactivity, carcinogenicity, toxicity and reproductive toxicity. The term “Hazardous Materials” shall include without limitation any “hazardous substances” as defined, listed, designated or regulated under CERCLA, any “hazardous wastes” or “solid wastes” as defined, listed, designated or regulated under RCRA, any asbestos or asbestos-containing materials, any polychlorinated biphenyls, and any petroleum or hydrocarbonic substance, fraction, distillate or by-product.

(iii) Except for any matter that would not reasonably be expected to have a Material Adverse Effect on Cilion, to Cilion’s Knowledge, (A) Except for the Cilion Facility, since inception, Cilion and each Cilion Subsidiary have been in compliance with all Environmental Laws relating to the properties or facilities owned, used, leased or occupied by Cilion and each Cilion Subsidiary (such properties or facilities (other than the Cilion Facility) used, leased or occupied by Cilion and each Cilion Subsidiary are defined herein as “ Cilion’s Other Facilities ”); (B) no discharge, emission, release, leak or spill of Hazardous Materials had occurred at any of Cilion’s Other Facilities that will give rise to liability of Cilion or any Cilion Subsidiary under Environmental Laws; (C) there were no Hazardous Materials (including, without limitation, asbestos) present in the surface waters, structures, groundwaters or soils of or beneath any of Cilion’s Other Facilities; and (D) there were no aboveground or underground storage tanks for Hazardous Materials at Cilion’s Other Facilities. With respect to the Cilion Facility, except for any matter that would not reasonably be expected to have a Material Adverse Effect on Cilion, to Cilion’s Knowledge, (A) for the two (2) year period ended December 1, 2009, Cilion and each Cilion Subsidiary have been in compliance with all Environmental Laws relating to the Cilion Facility; (B) no discharge, emission, release, leak or spill of Hazardous Materials had occurred at the Cilion Facility that will give rise to liability of Cilion or any Cilion Subsidiary under Environmental Laws; (C) there were no Hazardous Materials (including, without limitation, asbestos) present in the surface waters, structures, groundwaters or soils of or beneath the Cilion Facility; and (D) there were no aboveground or underground storage tanks for Hazardous Materials at the Cilion Facility

(m) Taxes .

(i) Cilion and each Cilion Subsidiary has prepared and timely filed (taking into account valid extensions) all U.S. federal and state income Tax Returns and other Tax Returns required to be filed by Cilion or any Cilion Subsidiary and such Tax Returns are true and correct in all material respects and have been completed in accordance with applicable law. All Taxes shown on such Tax Returns as due have been paid;

(ii) Cilion and each Cilion Subsidiary have timely withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, customer, stockholder, or other Person;

(iii) To the Knowledge of Cilion, there is no Tax deficiency currently outstanding or assessed or proposed against Cilion or any Cilion Subsidiary that is not reflected as a liability on the Cilion Financial Statements, nor has Cilion or any Cilion Subsidiary executed any agreements or waivers extending any statute of limitations on or extending the period for the assessment or collection of any Tax;

(iv) Neither Cilion nor any Cilion Subsidiary is a party to any tax-sharing agreement or similar arrangement with any other party, and neither Cilion nor any Cilion Subsidiary has assumed any obligation to pay any Tax obligations of, or with respect to any transaction relating to, any other Person or agreed to indemnify any other Person with respect to any Tax;

(v) No Tax Return of Cilion or any Cilion Subsidiary is currently being audited by a government or taxing authority, nor is any such audit in process or pending, and neither Cilion nor any Cilion Subsidiary has been notified in writing of any request for such an audit or other examination;

(vi) Cilion and each Cilion Subsidiary has disclosed to Aemetis any Tax exemption, Tax holiday or other Tax-sparing arrangement that Cilion or any Cilion Subsidiary has entered into in any jurisdiction, including the nature, amount and lengths of such Tax exemption, Tax holiday or other Tax-sparing arrangement. Cilion and each Cilion Subsidiary is in compliance with all material terms and conditions required to maintain such Tax exemption, Tax holiday or other Tax-sparing arrangement or order of any Governmental Entity and, to the Knowledge of Cilion, the consummation of the transactions contemplated hereby will not have any adverse effect on the continuing validity and effectiveness of any such Tax exemption, Tax holiday or other Tax-sparing arrangement or order;

(vii) Cilion and each Cilion Subsidiary has made available to Aemetis copies of all Tax Returns filed for the last three (3) years;

(viii) Neither Cilion nor any Cilion Subsidiary has constituted either a “distributing corporation” or a “controlled corporation” in a distribution of stock qualifying for tax-free treatment under Section 355 of the Code in the two years prior to the date of this Agreement;

(ix) Since inception, neither Cilion nor any Cilion Subsidiary has agreed to make, nor is required to make, any material adjustment under Section 481 of the Code or corresponding provision of state, local or foreign law by reason of any change in accounting method;

(x) There are no material liens or encumbrances on the assets of Cilion or any Cilion Subsidiary relating to or attributable to Taxes, other than liens for Taxes not yet due and payable;

(xi) No power of attorney with respect to Taxes is currently in effect with respect to Cilion or any Cilion Subsidiary;

(xii) Neither Cilion nor any Cilion Subsidiary has received a written claim by a taxing authority (domestic or foreign) in a jurisdiction where Cilion or any Cilion Subsidiary does not file Tax Returns to the effect that Cilion or any Cilion Subsidiary may be subject to Tax by that jurisdiction and there are no facts or circumstances that exist that could reasonably be expected to result in any such claim. To the Knowledge of Cilion, neither Cilion nor any Cilion Subsidiary has ever had a permanent establishment in any foreign country, as defined in any applicable tax treaty or convention between the United States and such foreign country; and

(xiii) Neither Cilion nor any Cilion Subsidiary will be required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any: (A) “closing agreement” as described in Section 7121 of the Code (or any corresponding or similar provision of state, local or foreign income Tax law) executed on or prior to the Closing Date; (B) intercompany transactions or any excess loss account described in Treasury Regulations under Section 1502 of the Code (or any corresponding or similar provision of state, local or foreign income Tax law); or (C) installment sale or open transaction disposition made on or prior to the Closing Date.

(n) Employee Benefit Plans . Section 4.1(n) of the Disclosure Schedule sets forth each employee benefit plan maintained, established or sponsored by the Company, or which the Company participates in or contributes to, which is subject to the Employee Retirement Income Security Act of 1974, as amended (“ ERISA ”). Cilion has complied in all material respects with all applicable laws for any such employee benefit plan.

(o) Employee Matters .

(i) As of the date hereof, neither Cilion nor any Cilion Subsidiary (A) has any employees or (B) is party to any employment agreements. There are no outstanding claims for unpaid wages or benefits by any former or current employee or consultant.

(ii) Except as disclosed or otherwise provided to Aemetis, neither the Company nor any Cilion Subsidiary is a party or subject to any labor union or collective bargaining Contract.

(iii) Effect of Transaction. Except as set forth in Article III, neither the execution and delivery of this Agreement nor the transactions contemplated hereby will (i) result in any payment (including severance, golden parachute, bonus or otherwise), becoming due to any Person, including any consultant, former consultant, employee or former employee, (ii) result in any forgiveness of indebtedness, or (iii) cause Cilion or any Cilion Subsidiary to be liable for the payment of any benefits.

(p) Insurance . Section 4.1(p) of the Cilion Disclosure Schedule sets forth a list of all insurance policies of Cilion and each Cilion Subsidiary. There is no material claim pending under any of such policies or bonds as to which coverage has been denied or disputed by the underwriters of such policies or bonds. As of the date hereof, all premiums due and payable under all such policies and bonds have been paid, and Cilion and each Cilion Subsidiary are otherwise in compliance in all material respects with the terms of such policies and bonds. Neither Cilion or any Cilion Subsidiary have Knowledge of any threatened termination of, or received written notice of any material premium increase with respect to, any of such policies.

(q) Brokers’ and Finders’ Fees . Except as identified on Section 4.1(q) of the Cilion Disclosure Schedule, no broker, finder or investment banker is entitled to brokerage or finders’ fees or agents’ commissions or investment bankers’ fees or any similar charges in connection with the Merger, this Agreement or any transaction contemplated hereby based upon arrangements made by or on behalf of Cilion or any Cilion Subsidiary.

(r) Intellectual Property . Schedule 4.1(r) sets forth a list that includes all material Intellectual Property Rights owned by Cilion or any of its Subsidiaries whether or not registered or subject to an application for registration (the “Cilion Intellectual Property Rights”). Cilion has not received any written charge, complaint, claim, demand or notice alleging any such infringement, misappropriation or other conflict (including any claim that Cilion must license or refrain from using any Intellectual Property Rights or other proprietary information of any other person) which has not been settled or otherwise fully resolved. To Cilion’s Knowledge, no other person has infringed upon, misappropriated or otherwise violated any Cilion Intellectual Property Rights.

(s) Stockholder Information Statement . The Information Statement, as supplemented or amended, if applicable, at the time such Information Statement or any amendment or supplement thereto is first mailed to stockholders of the Company, will not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.

(t) State Takeover Statutes . The Cilion Board has unanimously approved the terms of this Agreement and the consummation of the Merger and the other transactions contemplated hereby, and such approval represents all the actions necessary to render inapplicable to this Agreement, the Merger and the other transactions contemplated hereby, the restrictions on “business combinations” set forth in Section 203 of the DGCL, to the extent such restrictions would otherwise be applicable to this Agreement, the Merger and the other transactions contemplated hereby. No other state takeover statute or similar state statute or regulation applies to this Agreement, the Merger or the other transactions contemplated hereby.

(u) Exclusivity of Representations and Warranties . NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO AEMETIS, SUB AND MERGER SUB OR THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT (INCLUDING ANY INFORMATION CONTAINED IN THE DATA ROOM ESTABLISHED IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, FINANCIAL PROJECTIONS OR OTHER SUPPLEMENTAL DATA), EXCEPT AS SET FORTH EXPRESSLY IN SECTION 4.1 OF THIS AGREEMENT, AND IN ANY DOCUMENT PROVIDED BY CILION PURSUANT TO SECTIONS 6.1 AND 6.2 HEREOF, CILION IS MAKING NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, OF ANY NATURE WHATSOEVER AND CILION HEREBY DISCLAIMS ANY SUCH REPRESENTATION OR WARRANTY.

(v) Representations Complete . None of the representations or warranties made by Cilion in this Agreement, and none of the statements made in any exhibit, schedule or certificate furnished by Cilion pursuant to this Agreement, contains or will contain at the Effective Time, any untrue statement of a material fact, or omits or will omit at the Effective Time to state any material fact necessary in order to make the statements contained herein or therein, in the light of the circumstances under which made, not misleading.

SECTION 4.2 Representations and Warranties of Aemetis , Sub and Merger Sub. Subject to Section 8.10 below, Aemetis, Sub and Merger Sub represent and warrant to Cilion that the statements contained in this Section 4.2 are true and correct, except as disclosed in a document of even date herewith and delivered by Aemetis, Sub and Merger Sub to Cilion on the date hereof referring to the representations and warranties in this Agreement (the “ Aemetis Disclosure Schedule ”).

(a) Organization, Standing and Power . Aemetis is a corporation duly organized, validly existing and in good standing under the laws of the state of Nevada. Each of Sub and Merger Sub is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware. Each of Aemetis, Sub and Merger Sub has the corporate power to own its properties and to carry on its business as now being conducted and as proposed to be conducted and is duly qualified to do business and is in good standing in each jurisdiction in which the failure to be so qualified and in good standing would reasonably be expected to have a Material Adverse Effect on Aemetis.

(b) Authority . Aemetis, Sub and Merger Sub have all requisite corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of Aemetis, Sub and Merger Sub. This Agreement has been duly executed and delivered by Aemetis, Sub and Merger Sub and constitutes the valid and binding obligations of Aemetis, Sub and Merger Sub enforceable against Aemetis, Sub and Merger Sub in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to creditors’ rights generally, and subject to general principles of equity. No consent, approval, order or authorization of or registration, declaration or filing with any Governmental Entity is required by or with respect to Aemetis or any of its Subsidiaries in connection with the execution and delivery of this Agreement by Aemetis, Sub and Merger Sub or the consummation by Aemetis, Sub and Merger Sub of the transactions contemplated hereby, except for (i) the filing of the Certificate of Merger; (ii) such other consents, authorizations, filings, approvals and registrations which, if not obtained or made, would not reasonably be expected to have a Material Adverse Effect on Aemetis and would not prevent, materially alter or delay any of the transactions contemplated by this Agreement; or (iii) any filings, permits, authorizations, consents and approvals as may be required under the Securities Act, state securities or blue sky laws, and the Exchange Act.

(i) As of May 31, 2012, the authorized capital stock of Aemetis consists of (i) 400,000,000 shares of Aemetis Common Stock, of which 133,959,750 shares are issued and outstanding, (b) 7,235,565 shares of Aemetis Preferred Stock, of which 3,097,725 are issued and outstanding and (c) no shares held in treasury. There are an aggregate of 9,905,429 shares of Aemetis Capital Stock subject to issuance pursuant to stock options, restricted stock units, stock appreciation rights or other equity securities. There are 2,456,923 shares of Common Stock and 29,197 shares of Preferred Stock reserved for issuance upon the exercise of outstanding warrants. All outstanding shares of Aemetis Capital Stock are duly authorized, validly issued, fully paid and non-assessable and are free of any liens or encumbrances other than any liens or encumbrances created by or imposed upon the holders thereof, and are not subject to preemptive rights or rights of first refusal created by statute, Aemetis’ Amended and Restated Articles of Incorporation or Bylaws of Aemetis, or any agreement to which Aemetis is a party or by which it is bound. A sufficient number of shares of Aemetis Capital Stock have been reserved for issuance as Stock Merger Consideration. The Stock Merger Consideration, when issued, shall be validly authorized and issued, fully paid and non-assessable, free of any liens, encumbrances or other restrictions on transfer other than pursuant to applicable federal and state securities laws, and will be issued in compliance with applicable federal and state securities laws.

(ii) Except as set forth in Section 4.2(c) of the Aemetis Disclosure Schedule, the Closing Shares and the rights disclosed in Section 4.2(c)(i), there are no other options, warrants, restricted stock awards, calls, rights, commitments or agreements of any character to which Aemetis is a party or by which it is bound, obligating Aemetis to issue, deliver, sell, repurchase or redeem or cause to be issued, delivered, sold, repurchased or redeemed, any shares of Aemetis Capital Stock or obligating Aemetis to grant, extend, accelerate the vesting of, change the price of, or otherwise amend or enter into any such option, warrant, call, right, commitment or agreement. Except as set forth in Section 4.2(c) of the Aemetis Disclosure Schedule, there are no other contracts, commitments or agreements relating to voting, purchase or sale of Aemetis Capital Stock (A) between or among Aemetis and any of its holders of Aemetis Capital Stock; and (B) to Aemetis’ Knowledge, between or among any of the holders of Aemetis Capital Stock.

(iii) Aemetis owns, directly or indirectly, all of the issued and outstanding capital stock of Merger Sub. Merger Sub was formed solely for the purpose of engaging in the transactions contemplated by this Agreement, and, as of the date hereof and as of immediately prior to the Effective Time, (A) Merger Sub has engaged in no other business activities; (B) Merger Sub has incurred no Liabilities except for those Liabilities incurred in connection with its incorporation or organization or the transactions contemplated by this Agreement; and (C) neither Merger Sub nor Aemetis has entered into any agreements or arrangements with any Person that would interfere with the transactions contemplated by this Agreement.

(d) No Conflict . The execution and delivery of this Agreement and the transactions and other agreements contemplated hereby by Aemetis, Sub and Merger Sub do not, and the performance by Aemetis, Sub and Merger Sub of their obligations hereunder and the consummation of the Merger and the transactions contemplated hereby do not: (i) conflict with or violate any provision of Aemetis’ and or Merger Sub’s certificate of incorporation or bylaws, each as amended to date, or any resolutions adopted by the Board of Directors of Aemetis, Sub and Merger Sub; or (ii) assuming that all filings and notifications described in Section 4.2(e) have been made, conflict with or violate and statute, law, ordinance, rule or regulation applicable to Aemetis or Merger Sub or by which Aemetis or Merger Sub is bound or affected that would have or would be reasonably expected to have a Material Adverse Effect on Aemetis.

(e) Required Filings and Consents . Except for any applicable notifications and approvals required by FINRA, the filings, permits, authorizations, consents and approvals as may be required under, and other applicable requirements of, the Securities Act, the Exchange Act and state securities or blue sky laws, the execution and delivery of this Agreement and the transactions and other agreements contemplated hereby by Aemetis do not, and the performance by Aemetis of its obligations hereunder and thereunder and the consummation of the Merger and the transactions and other agreements contemplated hereby will not, require any consent, approval, authorization or permit of, or filing by Aemetis with or notification by Aemetis to, any Governmental Entity.

(f) Financing . Aemetis has, or will have as of the Closing, cash or borrowing facilities (as more fully described on Section 4.2(f) of the Aemetis Disclosure Schedule (the “Financing”)) available, which together are sufficient to enable it to (i) consummate the Merger, (ii) pay and deliver the Cash Merger Consideration, and (iii) pay all fees and expenses of Aemetis, Sub and Merger Sub in connection with the Merger. Copies of any such credit facilities related to the Financing have been provided to Cilion. The Financing will be available to Aemetis on a timely basis to consummate the Merger. Notwithstanding anything to the contrary contained herein, the parties acknowledge and agree that it shall not be a condition to the obligations of Aemetis, Sub or Merger Sub to effect the Merger that Aemetis have sufficient funds for payment of the Cash Merger Consideration.

(g) Compliance with Laws . The businesses of Aemetis and its Subsidiaries have been conducted in compliance with all applicable laws in all material respects. There is no pending, or to the Knowledge of Aemetis, threatened investigation or review of Aemetis or any of its Subsidiaries or Affiliates by any Governmental Entity or other Person, and there are no facts or circumstances that exist that could reasonably be expected to result in any such investigation or review. Aemetis and its Subsidiaries each have all Permits necessary to conduct its business as presently conducted except for any Permits the lack of which has not had a Material Adverse Effect on Aemetis as a whole. To the Knowledge of Aemetis, there are no facts or circumstances, including upon consummation of the transactions contemplated hereby, which will result in the revocation or termination of any Permit.

(h) Litigation .

(i) There is no private or governmental action, suit, proceeding, claim, arbitration or, to Aemetis’ Knowledge, investigation, pending before any Governmental Entity, foreign or domestic of which Aemetis has received written notice, or, to Aemetis’ Knowledge, is otherwise threatened against Aemetis, any of its properties or any of its officers or directors (in their capacities as such).

(ii) There is no judgment, decree or order against Aemetis or, to Aemetis’ Knowledge, any of its directors or officers (in their capacities as such), that (A) restricts in any manner the use, transfer or licensing of any Aemetis Proprietary Rights; (B) would prevent, enjoin, or materially alter or delay any of the transactions contemplated by this Agreement, or (C) that would reasonably be expected to have a Material Adverse Effect on Aemetis.

(i) SEC Filings; Financial Statements .

(i) Aemetis has made available to Cilion all forms, reports and documents filed by it with the SEC within the past five (5) years (collectively, the " Aemetis SEC Reports "). The Aemetis SEC Reports (A) at the time they were filed complied as to form in all material respects with the applicable requirements of the Securities Act or the Exchange Act, as the case may be, and (B) did not at the time they were filed (or if amended or superseded by a filing prior to the date of this Agreement, then on the date of such filing) contain any untrue statement of a material fact or omit 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. Aemetis has heretofore furnished to Cilion complete and correct copies of all amendments and modifications that have not been filed by Aemetis with the SEC to all agreements, documents and other instruments that previously had been filed by Aemetis with the SEC and are currently in effect.

(ii) Aemetis has delivered to Cilion the audited financial statements of Aemetis for the fiscal year ended December 31, 2009, and the draft unaudited financial statements (consolidated balance sheet, consolidated statement of operations and consolidated statement of cash flows) of Aemetis on a consolidated basis as at and for the fiscal period ended March 31, 2012 (collectively, the “ Aemetis Financial Statements ”). The Aemetis Financial Statements have been prepared in accordance with GAAP (except that the unaudited financial statements do not contain footnotes and are subject to normal recurring year-end audit adjustments, the effect of which is not expected in the aggregate to have a Material Adverse Effect with respect to Aemetis) applied on a consistent basis throughout the periods presented. The Aemetis Financial Statements fairly present, in all material respects, the consolidated financial position of Aemetis and the results of its operations and cash flows, as of the dates and for the periods indicated therein, in conformity with GAAP, subject to year-end audit adjustments and the absence of footnotes in the case of the unaudited Aemetis Financial Statements.

(iii) Aemetis has not had any material dispute with any of its auditors regarding accounting matters or policies during any of its past three (3) full fiscal years or during the current fiscal year to the date hereof.

(j) Absence of Undisclosed Liabilities . Neither Aemetis nor Merger Sub has any material obligations or liabilities of a type required to be reflected on a balance sheet prepared in accordance with GAAP, other than those obligations, liabilities or commitments (i) adequately provided for in the Aemetis Balance Sheet, and (ii) incurred in the ordinary course of business since the Aemetis Balance Sheet Date.

(k) Material Contracts .

(i) All of the Material Contracts of Aemetis and each of its Subsidiaries are listed in Section 4.2(k) of the Aemetis Disclosure Schedule and a true, correct and complete copy of each such Material Contract has been provided or made available to Cilion. With respect to each Material Contract: (A) the Material Contract is legal, valid, binding and enforceable and in full force and effect with respect to Aemetis and each Subsidiary of Aemetis, as applicable, and, to Aemetis’ Knowledge, is legal, valid, binding, enforceable and in full force and effect with respect to each other party thereto, in either case subject to the effect of bankruptcy, insolvency, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and except as the availability of equitable remedies may be limited by general principles of equity; and (B) neither Aemetis or each Subsidiary of Aemetis nor, to Aemetis’ Knowledge, any other party is in breach or default, and, no event has occurred or circumstance exists that with notice or lapse of time would constitute a breach or default by Aemetis or any Subsidiary of Aemetis, or, to Aemetis’ Knowledge, by any such other party, or permit termination, modification or acceleration, under such Material Contract. Neither Aemetis nor any of its Subsidiaries has received any written notice or other written communication regarding any actual or possible violation or breach of, default under, or intention to terminate, cancel, modify or not renew any Material Contract.

(ii) Except for the consents set forth in Section 4.2(k)(ii) of the Aemetis Disclosure Schedule, no prior consent of any party to a Material Contract is required for the consummation by Aemetis of the transactions contemplated hereby to be in compliance with the provisions of such Material Contract or to avoid the termination of, the loss of any right under or the incurrence of any obligation under, such Material Contract.

(l) Solvency . As of the Effective Time and immediately after giving effect to all of the transactions contemplated by this Agreement, including the Merger and the payment of the aggregate Merger Consideration pursuant hereto, and payment of all related fees and expenses of Aemetis, Sub and Merger Sub, (A) the amount of the "fair saleable value" of the assets of the Surviving Corporation will exceed the value of all liabilities of the Surviving Corporation, (B) the Surviving Corporation will not have an unreasonably small amount of capital for the operation of the businesses in which it is engaged or proposed to be engaged, and (C) the Surviving Corporation will be able to pay its liabilities, including contingent and other liabilities, as they mature. For purposes of the foregoing, "not have an unreasonably small amount of capital for the operation of the businesses in which it is engaged or proposed to be engaged" and "able to pay its liabilities, including contingent and other liabilities, as they mature" means that such Person will be able to generate enough cash from operations, asset dispositions or refinancing, or a combination thereof, to meet its obligations as they become due.

(m) Environmental Matters . Except for any matter that would not reasonably be expected to have a Material Adverse Effect, (A) Aemetis and each Aemetis Subsidiary are and have been in compliance with all Environmental Laws for periods of applicable statute of limitation; (B) since December 1, 2009, no discharge, emission, release, leak or spill of Hazardous Materials had occurred at the Cilion Facility that will give rise to liability of Aemetis, any Aemetis Subsidiary, Cilion or any Cilion Subsidiary under Environmental Laws; (C) since December 1, 2009, there were no Hazardous Materials (including, without limitation, asbestos) present in the surface waters, structures, groundwaters or soils of or beneath any of the Cilion Facility; and (D) since December 1, 2009, there were no aboveground or underground storage tanks for Hazardous Materials at the Cilion Facility.

(n) No Prior Activities . Except for obligations incurred in connection with its organization and the transactions contemplated hereby, Merger Sub has neither incurred any obligation or liability nor engaged in any business or activity of any type or kind whatsoever or entered into any agreement or arrangement with any Person.

(o) Brokers’ and Finders’ Fees . No broker, finder or investment banker is entitled to brokerage or finders’ fees or agents’ commissions or investment bankers’ fees or any similar charges in connection with the Merger, this Agreement or any transaction contemplated hereby based upon arrangements made by or on behalf of Aemetis, Merger Sub or any of their Affiliates.

(p) Representations Complete . None of the representations or warranties made by Aemetis or Merger Sub in this Agreement, and none of the statements made in any exhibit, schedule or certificate furnished by Aemetis pursuant to this Agreement, contains or will contain at the Effective Time, any untrue statement of a material fact, or omits or will omit at the Effective Time to state any material fact necessary in order to make the statements contained herein or therein, in the light of the circumstances under which made, not misleading.

(q) Investigation and Reliance . Aemetis is a sophisticated purchaser and has made its own investigation, review and analysis regarding Cilion and the transactions contemplated hereby, which investigation, review and analysis were conducted by Aemetis together with expert advisors that it has engaged for such purpose. Aemetis and its representatives have been provided with full and complete access to the properties, offices, plants and other facilities, books and records of Cilion and other information that they have requested in connection with their investigation of Cilion and the transactions contemplated hereby. Aemetis is not relying on any statement, representation or warranty, oral or written, express or implied, concerning Cilion, except as expressly set forth in Section 4.1 and the Cilion Disclosure Schedules. Neither Cilion nor any other Person shall have any liability to Aemetis or any other Person resulting from the use of any information, documents or materials made available to Aemetis, whether orally or in writing, in any confidential information memoranda, "data rooms," management presentations, due diligence discussions or in any other form in expectation of the transactions contemplated by this Agreement. Neither Cilion nor any other Person is making, directly or indirectly, any representation or warranty with respect to any estimates, projections or forecasts involving Cilion.

(r) Exclusivity of Representations and Warranties . EXCEPT AS SET FORTH EXPRESSLY HEREIN OR ANY OTHER TRANSACTION DOCUMENT, NEITHER AEMETIS OR MERGER SUB IS MAKING ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, OF ANY NATURE WHATSOEVER AND EACH OF AEMETIS OR MERGER SUB HEREBY DISCLAIMS ANY SUCH REPRESENTATION OR WARRANTY, WHETHER BY AEMETIS OR MERGER SUB.

(s) Survival of Representations and Warranties . Notwithstanding Section 9.3, the representations and warranties set forth in this Section 4.2(a), (b), (c), (d), (e), (g), (h), (j), (l) and (q) shall survive closing for a period of twelve (12) months following the Closing Date.

ARTICLE V

ADDITIONAL AGREEMENTS

SECTION 5.1 Conduct of Business by Cilion . Except as otherwise expressly permitted by this Agreement, as may be required by applicable law, or as consented to in writing by Aemetis (such consent not to be unreasonably withheld), during the period from the date of this Agreement to the Effective Time or earlier termination of this Agreement pursuant to Section 7, Cilion shall carry on its business in the ordinary course consistent with past practice. Without limiting the generality of the foregoing, after the date hereof and until the Effective Time or earlier termination of this Agreement pursuant to Section 7, Cilion shall not: (a) make any acquisition, by means of a purchase or otherwise, of a material amount of assets or securities, other than acquisitions in the ordinary course consistent with past practice; (b) agree to any sale, lease, encumbrance or other disposition of a material amount of assets or securities or any material change in its capitalization, other than sales or other dispositions in the ordinary course of business consistent with past practice, including without limitation, the sale of equipment and other assets consistent with past practice; (c) enter into any material contract other than in the ordinary course of business or release or relinquish or agree to release or relinquish of any material contract rights; (d) incur any long-term debt or short-term debt for borrowed money except for debt incurred in the ordinary course of business consistent with past practice; or (e) agree in writing or otherwise to take any of the foregoing actions. Notwithstanding the foregoing, after the date hereof and until the Effective Time or earlier termination of this Agreement pursuant to Section 7, Cilion may sell (i) equipment and other assets and (ii) equity securities of third parties owned by Cilion; provided that, in each case one hundred percent (100%) of the proceeds of such sales shall be used to reduce Cilion’s outstanding Indebtedness.

SECTION 5.2 Repayment of Cobank Credit Facility . Prior to the Closing Date, Cilion shall obtain from the applicable agent(s) under the Cobank Credit Agreement (the “Cobank Agent”) and deliver to Aemetis a letter (the “Cobank Release Letter”) in form and substance reasonably acceptable to the Lenders, (i) specifying as of the Closing Date the indebtedness outstanding under the Cobank Credit Agreement (including, in each case, all principal, accrued interest, fees, expenses, penalties and premiums thereon through the Closing Date) in accordance with the provisions of the Cobank Credit Agreement and (ii) agreeing to release all liens on Cilion assets subject to payment of the outstanding indebtedness.

SECTION 5.3 No Solicitation by Cilion .

(a) From and after the date of this Agreement to the Effective Time or earlier termination of this Agreement pursuant to Section 7, Cilion shall not, nor shall it authorize or permit any of its directors, officers or employees or any Representatives retained by it to, directly or indirectly through another person, (i) solicit, initiate or encourage, or take any other action designed to, or which could reasonably be expected to, facilitate, any inquiries or the making of any Takeover Proposal or (ii) enter into, continue or otherwise participate in any discussions or negotiations regarding, or furnish to any person any information with respect to, or otherwise cooperate in any way with, any Takeover Proposal. Without limiting the foregoing, it is agreed that any violation of the restrictions set forth in the preceding sentence by any Representative of Cilion shall be a breach of this Section 5.3(a) by Cilion. Cilion shall, immediately cease and cause to be terminated all existing discussions or negotiations with any person conducted heretofore with respect to any Takeover Proposal and request the prompt return or destruction of all confidential information previously furnished.

(b) Cilion shall promptly advise Aemetis in writing of the making of any proposal or offer that could reasonably be expected to lead to any Takeover Proposal, the material terms and conditions of any such Takeover Proposal and the identity of the person making such proposal. Cilion shall (i) keep Aemetis fully informed in all material respects of the status and details (including any change to the terms thereof) of any Takeover Proposal and (ii) provide to Aemetis as soon as practicable after receipt or delivery thereof copies of all correspondence and other written material sent or provided to Cilion from any person that describes any of the terms or conditions of any Takeover Proposal.

SECTION 5.4 Access to Information; Confidentiality . Subject to the existing Cellulosic Ethanol Project Memorandum of Understanding dated as of September 30, 2009 (the “ Confidentiality Agreement ”), between Aemetis and Cilion, during the period from the date of this Agreement to the Effective Time or earlier termination of this Agreement pursuant to Section 7, upon reasonable notice, Cilion shall afford Aemetis and to its officers, employees, accountants, counsel, financial advisors and other representatives, reasonable access during normal business hours to all of Cilion’s properties, books, contracts, commitments, personnel and records and, during such period, Cilion shall furnish promptly to Aemetis all other information concerning its business, properties and personnel as Aemetis may reasonably request. Aemetis will hold, and will cause its respective officers, employees, accountants, counsel, financial advisors and other representatives and Affiliates to hold, any nonpublic information in accordance with the terms of the Confidentiality Agreement.

SECTION 5.5 Reasonable Best Efforts .

(a) Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use its reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Merger and the other transactions contemplated by this Agreement, including using reasonable best efforts to accomplish the following: (i) the taking of all reasonable acts necessary to cause the conditions to Closing to be satisfied as promptly as practicable, (ii) the obtaining of all necessary actions or nonactions, waivers, consents and approvals from Governmental Entities and the making of all necessary registrations and filings (including filings with Governmental Entities, if any) and the taking of all reasonable steps as may be necessary to obtain an approval or waiver from, or to avoid an action or proceeding by any Governmental Entity, (iii) the obtaining of all necessary consents, approvals or waivers from third parties, and to fully carry out the purposes of, this Agreement and (iv) the execution and delivery of any additional instruments necessary to consummate the Merger and the other transactions contemplated by, and to fully carry out the purposes of, this Agreement.

(b) In connection with and without limiting the foregoing, Aemetis and its Board of Directors and Cilion and its Board of Directors shall each use their respective reasonable best efforts to: (1) take all action necessary to ensure that no state takeover statute or similar statute or regulation is or becomes applicable to this Agreement or the Merger or any of the other transactions contemplated by this Agreement and (2) if any state takeover statute or similar statute becomes applicable to this Agreement, the Merger or any other transactions contemplated by this Agreement, take all action necessary to ensure that the Merger and the other transactions contemplated by this Agreement may be consummated as promptly as practicable on the terms contemplated by this Agreement and otherwise to minimize the effect of such statute or regulation on this Agreement, the Merger and the other transactions contemplated by this Agreement.

SECTION 5.6 Observation Rights . Subject to the Securityholders’ Representative’s, or its designee’s execution of a confidentiality agreement satisfactory to the Aemetis Board, following the Effective Time and for a period of three (3) years thereafter, the Securityholders’ Representative, or its designee, shall be permitted to designate a representative to be present in a nonvoting observer capacity (the “ Board Observer ”) at all regularly scheduled meetings of the Board of Directors of Aemetis, all as further set forth in the Stockholders Agreement. The Board Observer shall be entitled to receive copies of all materials that are sent to the directors in their capacity as such in connection with a meeting of the Board of Directors of Aemetis. Notwithstanding the foregoing, the Aemetis Board shall have the right to exclude the Board Observer from Aemetis Board meetings or executive sessions or to withhold any information bearing on the Board Observer or this Agreement or if access to the information or attendance at the meeting could adversely affect the attorney-client privilege between Aemetis or any of its Subsidiaries or Affiliates and its counsel.

SECTION 5.7 Cilion Employees . Cilion shall have taken all necessary action to terminate the Cilion 401(k) Plan and the Option Plan, effective as of the day immediately preceding the Closing Date. All participants in the Cilion 401(k) Plan shall become fully vested in their benefit under the Cilion 401(k) Plan as a result of its termination. Cilion shall have provided Aemetis with resolutions of the Board of Directors of Cilion that the Cilion 401(k) Plan and Option Plan are terminated effective as of the day immediately preceding the Closing Date. Cilion shall have taken all necessary action to terminate all of its employees and to obtain the resignations of all of its directors as of the Closing Date.

SECTION 5.8 Officers’ and Directors’ Indemnification ; Indemnification of Stockholders .

(a) From and after the Effective Time, Aemetis shall, and shall cause the Surviving Corporation to, assume the obligations with respect to all rights to indemnification, advancement of expenses and exculpation from liabilities for acts or omissions occurring at or prior to the Effective Time now existing in favor of the current or former directors or officers of Cilion or any of its Subsidiaries (the “Indemnified Parties”) as provided in Cilion’s Certificate of Incorporation or Bylaws or any of its Subsidiaries (in each case, as in effect on the date hereof or as amended or entered into prior to the Effective Time with the consent of Aemetis), without further action, as of the Effective Time and such obligations shall survive the Merger and shall continue in full force and effect in accordance with their terms. The certificate of incorporation and bylaws of the Surviving Corporation shall contain the provisions with respect to indemnification and advancement of expenses set forth in Cilion’s Certificate of Incorporation and Bylaws as amended, restated and in effect on the date of this Agreement, which provisions shall not be amended, repealed or otherwise modified in any manner that would adversely affect the rights thereunder of the Indemnified Parties, unless such modification is required by Law.

(b) Cilion shall obtain, at the Effective Time, a prepaid (or “tail”) directors’ and officers’ liability insurance policy (the “D&O Tail Policy”) in respect of acts or omissions occurring at or prior to the Effective Time for six (6) years from the Effective Time, covering each person currently covered by Cilion’s directors’ and officers’ liability insurance policy (a complete and accurate copy of which has been heretofore made available to Aemetis) (collectively, the “Insured Parties”) on terms with respect to such coverage and amounts no less favorable than those of such policy in effect on the date of this Agreement. The cost of such D&O Tail Policy shall be a Cilion Transaction Expense.

SECTION 5.9 Anti-Dilution . In the event Aemetis, the Surviving Corporation or any of their respective successors or assigns (i) consolidates with or merges into any other Person and shall not be the continuing or surviving corporation or entity of such consolidation or merger or (ii) transfers or conveys all or substan tially all of its properties and assets to any Person, then, and in each such case, proper provisions shall be made so that the successors and assigns of Aemetis or the Surviving Corporation, as the case may be, assume the obligations set forth in this Section 5.9.

SECTION 5.10 Information Statement . As soon as reasonably practicable following the execution and delivery of the Executed Written Consent, Cilion shall (a) complete the preparation of an information statement accurately describing this Agreement and the transactions contemplated hereby and the provisions of Section 262 of the DGCL (the “ Information Statement ”), and (b) thereafter deliver the Information Statement to those holders of Cilion Capital Stock that did not execute the Executed Written Consent for the purpose of informing them of the approval of the Merger and the adoption of this Agreement, all in accordance with Section 228 of the DGCL.

SECTION 5.11 Use of Name. At any time after the date of this Agreement, neither Aemetis nor any of its Affiliates or Subsidiaries shall mention or otherwise use the name, logo, or trademark of any Cilion stockholder or any of its Affiliates (or any abbreviation or adaptation thereof) in any publication, press release, marketing and promotional material, or other form of publicity without the prior written approval of such Person in each instance.

SECTION 5.12 Tax Matters . The following provisions shall govern the allocation of responsibility as between the parties for certain Tax matters following the Closing Date:

(a) Tax Returns for Periods Ending on or Before the Closing Date . At the direction of the Securityholders’ Representative, Cilion shall prepare or cause to be prepared (in a manner consistent with prior practice) and timely file or cause to be timely filed all Tax Returns for Cilion and any Cilion Subsidiary for all periods ending on or prior to the Closing Date that are filed after the Closing Date. The Securityholders’ Representative shall permit Aemetis to review and comment on such Tax Returns prior to filing and shall not file such Tax Returns without Aemetis’ consent, which cannot be unreasonably withheld.

(b) Tax Returns for Periods Beginning Before and Ending After the Closing Date . Aemetis shall prepare or cause to be prepared and file or cause to be filed any Tax Returns of Cilion and any Cilion Subsidiary for Tax periods that begin before the Closing Date and end after the Closing Date (“Straddle Periods”). Aemetis shall permit the Securityholders’ Representative to review and comment on such Tax Returns prior to filing and shall not file such Tax Returns without the consent of the Securityholders’ Representative, which cannot be unreasonably withheld. With respect to Taxes of Cilion and any Cilion Subsidiary relating to a Straddle Period, the portion of the Tax which relates to the portion of such Straddle Period ending on the Closing Date shall (i) in the case of any Taxes other than Taxes based upon or related to income or receipts, be deemed to be the amount of such Tax for the entire Straddle Period multiplied by a fraction the numerator of which is the number of days in the Straddle Period ending on the Closing Date and the denominator of which is the number of days in the entire Straddle Period, and (ii) in the case of any Tax based upon or related to income or receipts, be deemed equal to the amount which would be payable if the relevant taxable period ended on the Closing Date.

(c) Cooperation on Tax Matters . The parties to this Agreement shall cooperate fully, as and to the extent reasonably requested by the other party, in connection with the filing of Tax Returns and any audit, litigation or other proceeding with respect to Taxes. Such cooperation shall include the retention and (upon another party’s request) the provision of records and information which are reasonably relevant to any such Tax Return, audit, litigation or other proceeding and making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder. The parties agree (i) to retain all books and records with respect to Tax matters pertinent to the Company relating to any taxable period beginning before the Closing Date until the expiration of the statute of limitations (and any extensions thereof) of the respective taxable periods, and to abide by all record retention agreements entered into with any taxing authority, and (ii) to give the other party reasonable written notice prior to transferring, destroying or discarding any such books and records and, if the other party so requests, to allow the other party to take possession of such books and records.

(d) Transfer Taxes . All transfer (including, without limitation, real property transfer and stock transfer), documentary, sales, use, stamp, registration and other such Taxes and fees (including, without limitation, any penalties and interest) incurred in connection with this Agreement shall be paid by Aemetis when due, and Aemetis will, at its own expense, file all necessary Tax Returns and other documentation with respect to all such transfer (including, without limitation, real property transfer and stock transfer), documentary, sales, use, stamp, registration and other Taxes and fees, and, if required by applicable law, will cause its Affiliates to, join in the execution of any such Tax Returns and other documentation.

(e) Tax Refunds . If Aemetis, Cilion or any Cilion Subsidiary receives a refund of Taxes with respect to a Pre-Closing Tax Period, Aemetis shall pay or cause to be paid the amount of such Tax refund to the Securityholders’ Representative (on behalf of the Securityholders) within fifteen (15) Business Days after receipt thereof (net of any applicable withholding Taxes and without interest, and net of any cost to Aemetis, Cilion or any Cilion Subsidiary attributable to the obtaining and receipt of such Tax refund), provided that (i) such Taxes were paid by Cilion or any Cilion Subsidiary prior to the Closing and (ii) such Tax refund does not arise as the result of a carryback of a loss or other Tax benefit from a Post-Closing Tax Period.

(f) No Closing Date Tax Actions . Aemetis shall not cause to be made any extraordinary transaction or event on the Closing Date that would result in any increased Tax liability for the Pre-Closing Tax Period. Aemetis shall not cause to be filed any election under Section 338 of the Code with respect to the transactions contemplated hereby.

(g) Additional Restrictions for Tax Returns for Periods Ending on or Before the Closing Date and Pre-Closing Tax Period Taxes . Aemetis shall not, without prior written consent of the Securityholders’ Representative, file, re-file or amend or permit Cilion or any Cilion Subsidiary to file, re-file or amend any Tax Return of Cilion or any Cilion Subsidiary that was due on or prior to the Closing Date, or enter or permit Cilion or any Cilion Subsidiary to enter into discussions regarding any voluntary disclosure involving Taxes for any Pre-Closing Tax Period.

ARTICLE VI

CONDITIONS PRECEDENT

SECTION 6.1 Conditions to Each Party’s Obligation to Effect the Merger . The respective obligations of each party to this Agreement to consummate and effect this Agreement and the transactions contemplated hereby shall be subject to the satisfaction at or prior to the Effective Time of each of the following conditions, any of which may be waived, in writing, by agreement of all the parties hereto:

(a) Securityholder Approval . The Requisite Securityholder Approval shall have been obtained.

(b) No Injunctions or Restraints; Illegality . No temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal or regulatory restraint or prohibition preventing the consummation of the Merger shall be and remain in effect, nor shall any proceeding brought by an administrative agency or commission or other governmental authority or instrumentality, domestic or foreign, seeking any of the foregoing be pending, which could reasonably be expected to have a Material Adverse Effect on Aemetis, either individually or combined with the Surviving Corporation, after the Effective Time, nor shall there be any action taken, or any statute, rule, regulation or order enacted, entered, enforced or deemed applicable to the Merger, which makes the consummation of the Merger illegal.

SECTION 6.2 Conditions to Obligations of Aemetis, Sub and Merger Sub . The obligation of Aemetis, Sub and Merger Sub to effect the Merger is further subject to satisfaction or waiver of the following conditions:

(a) Representations and Warranties . The representations and warranties of Cilion in this Agreement shall be true and correct in all material respects, on and as of the date of this Agreement and on and as of the Closing Date as though such representations and warranties were made on and as of such time (except for such representations and warranties that speak specifically as of the date hereof or as of another date, which shall be true and correct as of such date).

(b) Performance of Obligations . Cilion shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by it as of the Closing, except where the failure of Cilion to perform or comply with such covenants, obligations and conditions would not have a Material Adverse Effect on Aemetis, Merger Sub or Cilion.

(c) Certificate of Officers . Aemetis, Sub and Merger Sub shall have received a certificate executed on behalf of Cilion by the Chief Executive Officer and Chief Financial Officer of Cilion certifying that the conditions set forth in Sections 6.2(a) and 6.2(b) have been satisfied.

(d) Secretary’s Certificate . Aemetis, Sub and Merger Sub shall have received from Cilion’s Secretary, a certificate having attached thereto (i) Cilion’s Certificate of Incorporation as in effect immediately prior to the Effective Time, (ii) Cilion’s Bylaws as in effect immediately prior to the Effective Time, (iii) resolutions approved by Cilion’s Board of Directors approving and authorizing the Agreement and transactions contemplated hereby, (iv) the Executed Written Consent, and (v) a certificate of good standing (including tax good standing) issued by the Delaware Secretary of State and the State of California, each dated as of a date no more than five (5) Business Days prior to the Effective Date.

(e) Closing Date Balance Sheet . Cilion shall have delivered to Aemetis the Closing Date Balance Sheet.

(f) Dissenters’ Rights . Not more than six percent (6%) of Cilion Capital Stock outstanding immediately prior to the Effective Time shall be Dissenting Shares.

(g) FIRPTA Documents . Cilion shall have delivered to Aemetis all necessary forms and certificates complying with applicable law and duly executed, certifying that the transactions contemplated hereby are exempt from withholding under Section 1445 of the Code.

(h) Closing Payment Schedule . Aemetis shall have received the Closing Payment Schedule, as updated through Closing.

(i) Resignation Letters . Cilion shall have delivered to Aemetis written resignations of all officers, employees and directors of Cilion effective as of the Effective Time.

(j) Release and Termination of Security Interests . Aemetis shall have received the Cobank Release Letter.

(k) Cilion Warrants . Cilion Warrants shall have been terminated.

(l) Stockholders Agreement . Aemetis shall have received the Stockholders Agreement, executed by the Securityholders’ Representative.

(m) The Consulting Agreement between Cilion and Jeremy Wilhelm dated May 1, 2009 shall have been terminated effective as of the Effective Date and Cilion shall have delivered to Aemetis written confirmation in form and substance acceptable to Aemetis that all obligations of Cilion to Mr. Wilhelm pursuant to the Consulting Agreement have been satisfied in full.

(n) The Second Amended and Restated Registration Rights Agreement dated September 27, 2010 by and among Cilion and the holders of the Cilion Series A, B and C Preferred Stock shall have been terminated effective as of the Effective Date.

SECTION 6.3 Conditions to Obligations of Cilion . The obligations of Cilion to consummate and effect this Agreement and the transactions contemplated hereby shall be subject to the satisfaction at or prior to the Effective Time of each of the following conditions, any of which may be waived, in writing, by Cilion:

(a) Representations and Warranties . The representations and warranties of Aemetis, Sub and Merger Sub in this Agreement shall be true and correct in all respects, on and as of the date of this Agreement and on and as of the Closing Date, as though such representations and warranties were made on and as of such time (except for such representations and warranties that speak specifically as of the date hereof or as of another date, which shall be true and correct as of such date).

(b) Performance of Obligations . Aemetis, Sub and Merger Sub shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by them as of the Closing.

(c) Certificate of Officers . Cilion shall have received a certificate executed on behalf of Aemetis, Sub and Merger Sub by an executive officer of Aemetis, Sub and Merger Sub, respectively, certifying that the conditions set forth in Sections 6.3(a) and 6.3(b) have been satisfied.

(d) Governmental Approval . Aemetis, Merger Sub and Cilion shall have obtained from each Governmental Entity all approvals, waivers and consents necessary for consummation of the Merger and the transactions contemplated hereby, including such approvals, waivers and consents as may be required under the Securities Act and under state blue sky laws, other than any approvals, waivers and consents relating to the Merger or affecting Aemetis’ ownership of Cilion if failure to obtain such approval, waiver or consent would not reasonably be expected to have a Material Adverse Effect on Aemetis after the Effective Time.

(e) Stockholders Agreement . Cilion and the Securityholders’ Representative shall have received the Stockholders Agreement, executed by Aemetis.

SECTION 6.4 Frustration of Closing Conditions . None of Aemetis, Merger Sub or Cilion may rely on the failure of any condition set forth in Section 6.1, 6.2 or 6.3, as the case may be, to be satisfied if such failure was caused by such party’s failure to use its reasonable best efforts to consummate the Merger and the other transactions contemplated by this Agreement as required by and subject to Section 5.3.

ARTICLE VII

TERMINATION

SECTION 7.1 Termination . This Agreement may be terminated at any time prior to the Effective Time by written notice by the terminating party to the other party:

(a) by the mutual written consent of Aemetis and Cilion;

(b) by either Cilion or Aemetis if a court of competent jurisdiction or other Governmental Entity shall have issued a nonappealable final order, decree or ruling or taken any other action, in each case having the effect of permanently restraining, enjoining or otherwise prohibiting the Merger, unless the party relying on such order, decree or ruling or other action has not complied in all material respects with its obligations under this Agreement;

(c) by Aemetis if there has been a breach of any representation, warranty, covenant or agreement on the part of Cilion, which breach (i) causes the conditions set forth in Section 6.1 or 6.2 not to be satisfied; provided, however, that if an inaccuracy in any of Cilion’ representations and warranties or a breach of a covenant or obligation by Cilion is curable by Cilion and Cilion is continuing to exercise its reasonable best efforts to cure such inaccuracy or breach, then Aemetis may not terminate this Agreement under this Section 7.1(c) on account of such inaccuracy or breach unless such inaccuracy or breach shall remain uncured for a period of 30 days commencing on the date that Aemetis gives Cilion notice of such inaccuracy or breach; or

(d) by Cilion, if there has been a breach of any representation, warranty, covenant or agreement on the part of Aemetis or Merger Sub, which breach causes the conditions set forth in Section 6.1 or 6.3 not to be satisfied; provided, however, that if an inaccuracy in any of Aemetis’ representations and warranties or a breach of a covenant or obligation by Aemetis is curable by Aemetis and Aemetis is continuing to exercise its reasonable best efforts to cure such inaccuracy or breach, then Cilion may not terminate this Agreement under this Section 7.1(d) on account of such inaccuracy or breach unless such inaccuracy or breach shall remain uncured for a period of 30 days commencing on the date that Cilion gives Aemetis notice of such inaccuracy or breach; or

(e) Subject to Section 7.2 below, by either Aemetis or Cilion if the Closing does not occur by 5 P.M. on July 13, 2012 (the “ Drop Dead Date ”); provided, however, that the right to terminate this Agreement under this Section 7.1(e) shall not be available to any party whose failure to fulfill any obligation under this Agreement has been the cause of or resulted in the failure of the Merger to occur on or before such date.

SECTION 7.2 Effect of Termination .

(a) In the event of the termination of this Agreement as provided in Section 7.1, this Agreement shall be of no further force or effect; provided, however, that: (i) this Section 7.2, Section 7.3 and Section 8 shall survive the termination of this Agreement and shall remain in full force and effect; (ii) the Confidentiality Agreement shall survive the termination of this Agreement and shall remain in full force and effect in accordance with its terms; and (iii) the termination of this Agreement shall not relieve any party from any liability for any willful breach by the other party of any representation, warranty, covenant or agreement contained in this Agreement or fraud or willful misrepresentation; provided, however, that the party seeking relief is not in breach of any representation, warranty, covenant or agreement contained in this Agreement under circumstances which would have permitted the other party to terminate the Agreement under Section 7.1.

(b) Notwithstanding anything to the contrary in this Agreement, neither the lenders providing the Term Loan or the Revolving Credit Facility (the “Lenders”) nor their Affiliates nor their respective directors, officers, managers, employees, advisors and agents (collectively, the “Lender Entities”) shall have any liability to Cilion or any of its equity holders or Affiliates relating to or arising out of this Agreement, whether at law or equity, in contract or in tort or otherwise, and Cilion and its respective equity holders and Affiliates, shall not have any rights or claims, and shall not seek any loss or damage or any other recovery or judgment of any kind, including direct, indirect, consequential or punitive damages, against any of the Lender Entities under this Agreement, whether at law or equity, in contract or in tort or otherwise.

SECTION 7.3 Expenses; Termination Fees .

(a) Except as set forth in this Section 7.3, all fees and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such expenses, whether or not the Merger is consummated.

(b) In the event that the Closing does not occur for any reason other than (a) termination of this Agreement pursuant to Section 7.1(a), or (b) termination of this Agreement by Aemetis pursuant to Section 7.1(c), Aemetis shall issue to Cilion 1,000,000 shares of Aemetis Common Stock (the “ Termination Fee ”). The Termination Fee shall be issued, or paid, if applicable, no later than two Business Days following delivery of notice by the Company to Aemetis that such Termination Fee is due. If Aemetis becomes obligated to pay the Termination Fee, Cilion agrees that its right to receive the Termination Fee upon termination of this Agreement shall be deemed to be liquidated damages and shall be the sole and exclusive remedy of Cilion, its Subsidiaries, stockholders, Affiliates, officers, directors, employees or Representatives against Aemetis or any of its Subsidiaries, Representatives or Affiliates for, and in no event will Cilion or any other such Person seek to recover any other money damages or seek any other remedy based on a claim in law or equity with respect to, (A) any loss suffered as a result of the failure of the Merger to be consummated, (B) the termination of this Agreement, (C) any liabilities or obligations arising under this Agreement, or (D) any claims or actions arising out of or relating to any breach, termination or failure of or under this Agreement, in each case, including but not limited to, any failure to seek or obtain the proceeds of the Financing or any alternative financing and any event related thereto.

(c) Notwithstanding any provision in this Agreement to the contrary, in no event shall Aemetis be required to pay the Termination Fee on more than one occasion or to pay any amounts pursuant to this Section 7.3 which in the aggregate exceed the amount of the Termination Fee.

ARTICLE VIII

SECURITYHOLDERS’ REPRESENTATIVE

SECTION 8.1 Securityholders’ Representative .

(a) At the Closing, Western Milling Investors, LLC shall be constituted and appointed as the Securityholders’ Representative. For purposes of this Agreement, the term “ Securityholders’ Representative ” shall mean the agent for and on behalf of the holders of Cilion Capital Stock (other than a holder of solely shares of Cilion Capital Stock which constitute and remain Dissenting Shares) to: (i) give and receive notices and communications to or from Aemetis (on behalf of itself of any other Indemnified Person) relating to this Agreement, the Stockholders Agreement or any of the transactions and other matters contemplated hereby or thereby; (ii) provide any consents hereunder, including with respect to any proposed settlement of any claims or agree to any amendment to this Agreement or the Stockholders Agreement; (iii) take any action or pursue any claims against Aemetis or any of its Subsidiaries under this Agreement, or otherwise agree to settle or compromise any debts or obligations hereunder; provided any such action shall be taken at the direction of the holders of a majority of the Closing Shares; and (iv) take all actions necessary or appropriate in the judgment of the Securityholders’ Representative for the accomplishment of the foregoing, in each case without having to seek or obtain the consent of any Person under any circumstance. All such actions taken by the Securityholders’ Representative shall be deemed to be facts ascertainable outside this Agreement and shall be binding on the holders of Cilion Capital Stock (other than a holder of solely shares of Cilion Capital Stock which constitute and remain Dissenting Shares) as a matter of contract law. The Person serving as the Securityholders’ Representative may be replaced from time to time by the holders of a majority of the Closing Shares upon not less than ten days’ prior written notice to Aemetis.

(b) The Securityholders’ Representative shall not be liable to any former holder of Cilion Capital Stock for any act done or omitted hereunder or the Stockholders Agreement as the Securityholders’ Representative while acting in good faith (and any act done or omitted pursuant to the advice of counsel shall be conclusive evidence of such good faith) and without gross negligence or willful misconduct. The holders of Cilion Capital Stock (other than a holder of solely shares of Cilion Capital Stock which constitute and remain Dissenting Shares) shall severally indemnify the Securityholders’ Representative and hold it harmless against any loss, liability or expense incurred without gross negligence, willful misconduct or bad faith on the part of the Securityholders’ Representative and arising out of or in connection with the acceptance or administration of its duties hereunder, including any out-of-pocket costs and expenses and legal fees and other legal costs reasonably incurred by the Securityholders’ Representative. If not paid out of the Securityholders’ Representative Fund (as defined below), such losses, liabilities or expenses may be recovered directly by the Securityholders’ Representative from the holders of Cilion Preferred Stock (other than a holder of solely shares of Cilion Capital Stock which constitute and remain Dissenting Shares) according to their respective Pro Rata Shares. No provision of this Agreement shall require the Securityholders’ Representative to expend or risk its own funds or otherwise incur any financial liability in the exercise or performance of any of its powers, rights, duties or privileges under this Agreement or the Stockholders Agreement on behalf of any holder of Cilion Capital Stock Holder.

(c) Any notice or communication given or received by, and any decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, the Securityholders’ Representative that is within the scope of the Securityholders’ Representative’s authority under this Section 8.1 shall constitute a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of all the holders of Cilion Capital Stock (other than a holder of solely shares of Cilion Capital Stock which constitute and remain Dissenting Shares) and shall be final, binding and conclusive upon each such holders.

SECTION 8.2 Securityholders’ Representative Fund . At the Closing, the Company shall pay an aggregate amount not to exceed $72,000 from the Closing Date Cash Balance to the Securityholders’ Representative as the Securityholders’ Representative Fund (the “ Securityholders’ Representative Fund ”). The Securityholders’ Representative’s Fund shall be available to the Securityholders’ Representative to pay all liabilities and expenses that are incurred in the performance of its duties as Securityholders’ Representative under this Agreement and the Stockholders Agreement and certain other liabilities of the Company.

ARTICLE IX

GENERAL PROVISIONS

SECTION 9.1 Amendment . This Agreement may be amended with the approval of the respective boards of directors of Cilion and Aemetis at any time (whether before or after the adoption of this Agreement by Cilion’s stockholders); provided, however, that after any such adoption of this Agreement by Cilion’s stockholders, no amendment shall be made which by applicable Law requires further approval of the stockholders of Cilion without the further approval of such stockholders. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties hereto.

SECTION 9.2 Waiver . No failure on the part of any party to exercise any power, right, privilege or remedy under this Agreement, and no delay on the part of any party in exercising any power, right, privilege or remedy under this Agreement, shall operate as a waiver of such power, right, privilege or remedy; and no single or partial exercise of any such power, right, privilege or remedy shall preclude any other or further exercise thereof or of any other power, right, privilege or remedy. No party shall be deemed to have waived any claim arising out of this Agreement, or any power, right, privilege or remedy under this Agreement, unless the waiver of such claim, power, right, privilege or remedy is expressly set forth in a written instrument duly executed and delivered on behalf of such party; and any such waiver shall not be applicable or have any effect except in the specific instance in which it is given.

SECTION 9.3 No Survival of Representations and Warranties; Survival of Covenants . Except as otherwise set forth in Section 4.2(s) of this Agreement, none of the representations and warranties contained in this Agreement or in any certificate or other agreement delivered pursuant to this Agreement shall survive the Merger. The covenants and agreements which by their terms do not contemplate performance after the Closing shall terminate as of the Closing. The covenants and agreements which by their terms contemplate performance after the Closing Date shall survive the Closing in accordance with their terms until sixty (60) days following the expiration of any applicable statute of limitations; provided that any such covenant or agreement which expires on a date certain shall survive until such date certain.

SECTION 9.4 Notices . All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given or made as follows: (a) if sent by registered or certified mail in the United States return receipt requested, upon receipt; (b) if sent by nationally recognized overnight air courier (such as Federal Express), two Business Days after mailing; (c) if sent by facsimile transmission or e-mail before 5:00 p.m. Eastern Time, when transmitted and receipt is confirmed; (d) if sent by facsimile transmission or e-mail after 5:00 p.m. Eastern Time and receipt is confirmed, on the following Business Day; and (e) if otherwise actually personally delivered, when delivered, provided that such notices, requests, demands and other communications are delivered to the physical address, e-mail address or facsimile number set forth below, or to such other address as any party shall provide by like notice to the other parties to this Agreement:

(a) if to Aemetis or Merger Sub, to

Aemetis, Inc.

20400 Stevens Creek Blvd., Suite 700

Cupertino, CA 95014

Telephone: (408) 213-0940

Facsimile No.: (408) 252-8044

Attention: Chief Financial Officer

And

(b) if to Cilion, to

Cilion, Inc.

31120 West Street

Goshen, CA 93227

Facsimile No.: (559) 651-0246

Attention: Kevin Kruse

with a copy (which shall not constitute effective notice) to:

Morgan, Lewis & Bockius LLP

502 Carnegie Center

Princeton, NJ 08540-6289

Phone: 609.919.6600

Fax: 609.919.6701

Attention: Denis Segota

Western Milling Investors, LLC

31120 West Street

Goshen, CA 93227

Facsimile No.: (559) 651-0246

Attention: Jeremy Wilhelm

SECTION 9.5 Cooperation . Cilion and Aemetis agree to cooperate fully with Aemetis and Cilion, respectively, and to execute and deliver such further documents, certificates, agreements and instruments and to take such other actions as may be reasonably requested by Aemetis or Cilion to evidence or reflect the transactions and to carry out the intent and purposes of this Agreement.

SECTION 9.6 Interpretation. The parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement. When a reference is made in this Agreement to an Article, Section or Exhibit, such reference shall be to an Article or Section of, or an Exhibit to, this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”. The words “hereby”, “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The words “date hereof” shall refer to the date of this Agreement. The word “extent” in the phrase “to the extent” shall mean the degree to which a subject or other thing extends, and such phrase shall not mean simply “if”. The term “or” shall not be deemed to be exclusive. All terms defined in this Agreement shall have the defined meanings when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References to a person are also to its permitted successors and assigns.

SECTION 9.7 Entire Agreement; Counterparts; Exchanges by Facsimile . This Agreement and the other agreements referred to herein constitute the entire agreement and supersede all prior agreements and understandings, both written and oral, among or between any of the parties with respect to the subject matter hereof and thereof; provided, however, that the Confidentiality Agreement shall not be superseded and shall remain in full force and effect in accordance with its terms (it being understood that no provision in the Confidentiality Agreement shall limit any party’s rights or remedies in the case of fraud). This Agreement may be executed in several counterparts, each of which shall be deemed an original and all of which shall constitute one and the same instrument. The exchange of a fully executed Agreement (in counterparts or otherwise) by facsimile or electronic transmission shall be sufficient to bind the parties to the terms and conditions of this Agreement.

SECTION 9.8 Assignability; No Third Party Rights . This Agreement shall be binding upon, and shall be enforceable by and inure solely to the benefit of, the parties hereto and their respective successors and assigns; provided, however, that neither this Agreement nor any party’s rights or obligations hereunder may be assigned or delegated by such party without the prior written consent of the other parties, and any attempted assignment or delegation of this Agreement or any of such rights or obligations by any party without the prior written consent of the other parties shall be void and of no effect; provided, further, that notwithstanding anything to the contrary in the foregoing, each of Aemetis, Sub and Merger Sub may assign its rights and interests hereunder to the Lenders for collateral security purposes pursuant to the terms of the Commitment Letter; provided that any such assignment by Aemetis or Merger Sub shall not relieve the assigning party of its obligations hereunder. Except for the right of holders of Cilion Capital Stock to receive the Merger Consideration in accordance with Section 3.1, nothing in this Agreement, express or implied, is intended to or shall confer upon any Person (other than the parties hereto) any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

SECTION 9.9 Governing Law; Venue . This Agreement shall be governed by, and construed in accordance with, the laws of the State of California, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof. In any action between any of the parties arising out of or relating to this Agreement or any of the transactions contemplated hereby: (a) each of the parties irrevocably and unconditionally consents and submits to the exclusive jurisdiction and venue of the Superior Court of the State of California; and (b) each of the parties irrevocably waives the right to trial by jury. Each of the parties hereto further agrees that, to the fullest extent permitted by applicable law, service of any process, summons, notice or document by U.S. registered mail to such Person’s respective address set forth in Section 8.2 will be effective service of process for any claim, action, suit or other proceeding in the Superior Court of the State of California with respect to any matters to which it has submitted to jurisdiction as set forth in this paragraph. The parties hereto hereby agree that a final judgment in any such claim, suit, action or other proceeding will be conclusive, subject to any appeal, and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable law. The parties agree that irreparable damage would occur and that the parties would not have any adequate remedy at law in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement without the requirement for the posting of any bond, this being in addition to any other remedy to which they are entitled at law or in equity. All rights and remedies existing under this Agreement are cumulative to, and not exclusive of, any rights or remedies otherwise available.

SECTION 9.10 Disclosure Schedules . The Cilion Disclosure Schedule shall be arranged in separate parts corresponding to the numbered and lettered sections contained in Section 4.1. The Aemetis Disclosure Schedule shall be arranged in separate parts corresponding to the numbered and lettered sections contained in Section 4.2. For purposes of this Agreement: (a) each statement or other item of information set forth in the Cilion Disclosure Schedule shall qualify other sections and subsections in Section 4.1 to the extent it is readily apparent from a reading of the disclosure that such disclosure is applicable to such other sections and subsections; and (b) each statement or other item of information set forth in the Aemetis Disclosure Schedule is intended shall qualify other sections and subsections in Section 4.2 to the extent it is readily apparent from a reading of the disclosure that such disclosure is applicable to such other sections and subsections. The Cilion Disclosure Schedule and Aemetis Disclosure Schedule shall each be delivered as of the date hereof, and no amendments or modifications thereto shall be made. Any purported update or modification to the Cilion Disclosure Schedule or Aemetis Disclosure Schedule after the date hereof shall be disregarded.

SECTION 9.11 Severability . If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible to the fullest extent permitted by applicable law in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.

SECTION 9.12 Personal Liability . Except as expressly set forth herein, this Agreement shall not create or be deemed to create or permit any personal liability or obligation on the part of any direct or indirect stockholder of Cilion or any officer, director, employee, representative, agent or investor of any party hereto.

SECTION 9.13 Absence of Presumption . The parties hereto have participated jointly in the negotiation and drafting of this Agreement and, in the event of ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by such parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.

[Signature page follows]

IN WITNESS WHEREOF, Aemetis, Sub, Merger Sub and Cilion have caused this Agreement to be signed by their respective officers thereunto duly authorized, all as of the date first written above.

AEMETIS, INC.

by		/s/ Eric A. McAfee
Name:		Eric A. McAfee
Title:		Chief Executive Officer and President


AE ADVANCED FUELS, INC.

by		/s/ Andy Foster
Name:		Andy Foster
Title:		President


KEYES FACILITY ACQUISITION CORP.

by		/s/ Eric A. McAfee
Name:		Eric A. McAfee
Title:		President

CILION, INC.

by	/s/ Kevin Kruse
Name:	Kevin Kruse
Title:	President

[Signature Page to Agreement and Plan of Merger]

EXHIBIT 10.1

STOCKHOLDERS’ AGREEMENT

by and between

AEMETIS, INC.

and

WESTERN MILLING INVESTORS, LLC,

AS SECURITYHOLDERS’ REPRESENTATIVE

Dated as of July 6, 2012

STOCKHOLDERS’ AGREEMENT

THIS STOCKHOLDERS’ AGREEMENT (this “ Stockholders Agreement ”) is made and entered into as of July 6, 2012, by and between Aemetis, Inc., a Nevada corporation (the “ Company ”) and Western Milling Investors, LLC, solely in its capacity as the Securityholders’ Representative acting on behalf of certain former holders of Series A Preferred and Series B Preferred Stock of Cilion, Inc., all of which are identified on Schedule I attached hereto (the “ Cilion Stockholders ”). Reference is made to that certain Agreement and Plan of Merger, dated as of the date hereof (the “ Merger Agreement ”), by and among Company, AE Advanced Fuels, Inc., Keyes Facility Acquisition Corp. (“ Merger Sub ”), Cilion, Inc. (“ Cilion ”) and the Securityholders’ Representative.

W I T N E S S E T H

WHEREAS, this is the Stockholders’ Agreement referred to in the Merger Agreement;

WHEREAS, pursuant to the Merger Agreement, Company will acquire Cilion through the Merger of Merger Sub with and into Cilion, with Cilion being the surviving corporation;

WHEREAS, in the Merger, the capital stock of Cilion owned by the Cilion Stockholders will be converted into the right to receive Cash Merger Consideration and Stock Merger Consideration, all as more particularly set forth in the Merger Agreement;

WHEREAS, the Cilion Stockholders appointed the Securityholders’ Representative as their sole representative and agent to act on their behalf in regard to any matters arising under the Merger Agreement and this Stockholders Agreement; and

WHEREAS, the execution and delivery of this Agreement is a condition precedent to Cilion’s obligation to consummate the Merger Agreement and transactions contemplated thereby.

NOW, THEREFORE, in consideration of the foregoing and mutual covenants and agreements hereinafter set forth, and for other consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:

ARTICLE I

OBSERVER RIGHTS

Section 1.1 Observer Rights .

(a) For a period of three (3) years following the date hereof, the Securityholders’ Representative, or its designee, shall be permitted to be present in a nonvoting observer capacity (the “ Board Observer ”) at all meetings of the Board of Directors (the “ Board ”) of the Company. The Board Observer shall be entitled to receive copies of all notices, minutes, consents, and other materials that the Company provides to its directors at the same time and in the same manner as provided to such directors provided, however, that the Board Observer shall agree to hold in confidence and trust all information so provided. Notwithstanding the foregoing, in the event the Securityholders’ Representative, or its designee, has not executed and delivered to the Company a confidentiality agreement in the form of Exhibit A attached hereto (the “ Confidentiality Agreement ”), the Company reserves the right to withhold any information and to exclude the Board Observer from any meeting or portion thereof if access to such information or attendance at such meeting could adversely affect the attorney-client privilege or attorney work product privilege between the Company and its counsel or result in disclosure of trade secrets or information of third parties the confidentiality of which the Company is obligated to maintain.

(b) The Company recognizes and acknowledges that the Securityholders’ Representative and the Cilion Stockholders may now or in the future be engaged in the research, development, production, marketing, licensing and/or sale of similar services or products to those being researched, developed, produced, marketed, licensed and/or sold by the Company and its Subsidiaries. Nothing in this Stockholders’ Agreement shall be construed to prevent the Securityholders’ Representative and the Cilion Stockholders from engaging independently in such activities.

(c) Nothing contained in this Stockholders’ Agreement shall be construed as preventing Securityholders’ Representative from distributing such information to the Cilion Stockholders, which Securityholders’ Representative may elect to do in its sole discretion but only if the Cilion Stockholder receiving such information has signed the Confidentiality Agreement or a similar form of confidentiality agreement. For purposes of this Stockholders’ Agreement, the term “ Material Confidential Information ” means material nonpublic information under Regulation FD.

ARTICLE II

REGULATORY COMPLIANCE

Unless otherwise specified in this Article II, the Company covenants with Securityholders’ Representative as follows, which covenants are for the benefit of each Cilion Stockholder and their respective permitted assignees.

Section 2.1 Applicable Regulatory Compliance .

(a) The Company agrees to provide, or cause to be provided, to the Securityholders’ Representative, or its designee(s), as promptly as reasonably practicable upon written request therefor, any information in the possession or under the control of the Company or its Subsidiaries to the extent (i) reasonably necessary to allow the Cilion Stockholders to comply with reporting, disclosure, filing or other requirements imposed on it or its Affiliates by a Governmental Authority having jurisdiction over it, including under applicable securities or tax laws, including the Sarbanes-Oxley Act of 2002 and the rules and regulations thereunder, or applicable rules of any Self-Regulatory Organization (collectively, the “Applicable Regulatory Requirements”); (ii) reasonably required for use by the Securityholders’ Representative and/or Cilion Stockholders in any judicial, regulatory, administrative, tax or other proceeding; or (iii) reasonably required in order to satisfy any audit, accounting, claims, regulatory, litigation, tax or other similar requirements; provided that the Company shall have the right to redact any Company Material Confidential Information.

(b) The Company will maintain true books and records of account in which full and correct entries will be made of all its business transactions pursuant to a system of accounting established and administered in accordance with GAAP, consistently applied, and will set aside on its books such accruals and reserves as may be required under GAAP.

(c) The Company shall use commercially reasonable efforts to maintain systems of disclosure controls and procedures and internal control over financial reporting, to the extent and only to the extent if such systems are reasonably required to enable the Securityholders’ Representative to satisfy its obligations under applicable securities laws, including under the Sarbanes-Oxley Act of 2002 and the rules and regulations thereunder.

Section 2.2 Securities Compliance . The Company shall notify the SEC in accordance with its rules and regulations, of the transactions contemplated by the Merger Agreement and this Stockholders Agreement and shall take all other necessary action and proceedings as may be required and permitted by applicable law, rule and regulation, for the legal and valid issuance of the Stock Merger Consideration to the Cilion Stockholders.

Section 2.3 Reporting Requirements . If the Company has not filed its periodic reports with the SEC, or if the SEC ceases making these periodic reports available via the Internet without charge, then the Company shall furnish the following to the Securityholders’ Representative:

(a) as soon as practicable, but in any event within ninety (90) days after the end of each fiscal year of the Company, (i) a balance sheet as of the end of such year, (ii) statements of income and of cash flows for such year, and a comparison between (x) the actual amounts as of and for such fiscal year and (y) the comparable amounts for the prior year and as included in the Budget (as defined below) for such year, with an explanation of any material differences between such amounts and a schedule as to the sources and applications of funds for such year, and (iii) a statement of stockholders’ equity as of the end of such year, all such financial statements audited and certified by independent public accountants selected by the Board.

(b) as soon as practicable, but in any event within forty five (45) days after the end of each of the first three (3) quarters of each fiscal year of the Company, unaudited statements of income and of cash flows for such fiscal quarter, and an unaudited balance sheet and a statement of stockholders’ equity as of the end of such fiscal quarter, all prepared in accordance with GAAP (except that such financial statements may (i) be subject to normal year-end audit adjustments and (ii) not contain all notes thereto that may be required in accordance with GAAP);

(c) as soon as practicable, but in any event thirty (30) days before the end of each fiscal year, a budget and business plan for the next fiscal year for the Company (collectively, the “Budget”), approved by the Board and prepared on a monthly basis, including balance sheets, income statements, and statements of cash flow for such months and, promptly after prepared, any other budgets or revised budgets prepared by the Company; and

(d) if, for any period, the Company has any Subsidiary whose accounts are consolidated with those of the Company, then in respect of such period the financial statements delivered pursuant to the foregoing sections shall be the consolidated and consolidating financial statements of the Company and all such consolidated Subsidiaries.

ARTICLE III

REGISTRATION RIGHTS

Registration Rights . The Company covenants and agrees as follows:

Section 3.1 Definitions . For purposes of this Article III:

(a) The term “Act” means the Securities Act of 1933, as amended.

(b) The term “Form S-3” means such form under the Act as in effect on the date hereof or any registration form under the Act subsequently adopted by the SEC that permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC.

(c) The term “Holder” means any person owning or having the right to acquire Registrable Securities or any assignee thereof in accordance with Section 3.9 hereof.

(d) The term “Initial Offering” means the Company’s first firm commitment underwritten public offering of its Common Stock under the Act that results in the conversion of the Company’s outstanding Preferred Stock into Common Stock in accordance with the provisions of the Company’s Amended and Restated Certificate of Incorporation.

(e) The term “Other Holder” means any other Company stockholder to whom the Company has granted registration rights.

(f) The term “1934 Act” means the Securities Exchange Act of 1934, as amended.

(g) The terms “register,” “registered,” and “registration” refer to a registration effected by preparing and filing a registration statement or similar document in compliance with the Act, and the declaration or ordering of effectiveness of such registration statement or document.

(h) The term “Registrable Securities” means (i) the shares of the Company’s common stock issued to the Cilion Stockholders pursuant to the Merger Agreement (the “Merger Shares”), (ii) any capital stock of the Company issued or issuable as a dividend or other distribution with respect to, or in exchange for, or in replacement of, the Merger Shares, whether by stock split, recapitalization, merger, consolidation or otherwise, until the registration rights granted by this Agreement with respect to the Merger Shares have terminated in accordance with this Agreement.

(i) The term “Rule 144” shall mean Rule 144 under the Act.

(j) The term “SEC” shall mean the Securities and Exchange Commission.

Section 3.2 Company Registration .

(a) If (but without any obligation to do so) the Company proposes to register any of its stock or other securities under the Act in connection with the public offering of such securities (other than a registration relating solely to the sale of securities of participants in a Company employee benefit plan, a registration covering only securities proposed to be issued in exchange for securities or assets of another corporation, or a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities that are also being registered), the Company shall, at such time, promptly give each Holder written notice of such registration. Upon the written request of each Holder given within twenty (20) days after such notice is delivered to such Holder in accordance with Section 3.5, the Company shall, subject to the provisions of Section 3.2(c), use best efforts to cause to be registered under the Act all of the Registrable Securities that each such Holder requests to be registered.

(b) Right to Terminate Registration . The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 3.2 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration. The expenses of such withdrawn registration shall be borne by the Company in accordance with Section 3.6 hereof.

(c) Underwriting Requirements . In connection with any offering involving an underwriting of shares of the Company’s capital stock, the Company shall not be required under this Section 3.2 to include any of the Holders’ securities in such underwriting unless they accept the terms of the underwriting as agreed upon between the Company and the underwriters selected by the Company (or by other persons entitled to select the underwriters) and enter into an underwriting agreement in customary form with such underwriters, and then, subject to the remaining provisions of this Section 3.2(c), only in such quantity as the underwriters determine in their sole discretion will not jeopardize the success of the offering by the Company. If the managing underwriters advise the Company in writing that in their opinion the number of securities requested to be included in such registration exceeds the number which can be sold in such offering without adversely affecting the marketability of the offering, the Company will include in such registration only the amount of securities which the managing underwriters have advised can be sold, and will allocate such amount, first , to the amount of securities the Company proposes to sell and second , pro rata among the Holders and Other Holders based on the number of shares held by all such Holders and Other Holders or in such other proportions as shall mutually be agreed to by all such selling holders. For purposes of the preceding sentence concerning apportionment, for any selling stockholder that is a Holder of Registrable Securities and that is a venture capital fund, partnership or corporation, the affiliated venture capital funds, partners, retired partners and stockholders of such Holder, or the estates and family members of any such partners and retired partners and any trusts for the benefit of any of the foregoing persons shall be deemed to be a single “selling Holder,” and any pro rata reduction with respect to such “selling Holder” shall be based upon the aggregate amount of Registrable Securities owned by all such related entities and individuals.

Section 3.3 Demand Registration . In case the Company shall receive from the Holders of at least twenty-five percent (25%) of the Registrable Securities (for purposes of this Section 3.3, the “Initiating Holders”) a written request or requests that the Company effect a registration on Form S-3 and any related qualification or compliance with respect to all or a part of the Registrable Securities owned by such Holder, the Company shall:

(a) promptly give written notice of the proposed registration, and any related qualification or compliance, to all Holders; and

(b) prepare and file with the SEC a registration statement with respect to such Registrable Securities and any other securities for which registration has been requested by Other Holders within ninety (90) days after any written request for registration, and use its best efforts to cause such registration statement to become effective (provided, that before filing a registration statement or prospectus or any amendments or supplements thereto, the Company will furnish to a single counsel selected by the Holders and Other Holders copies of all such documents proposed to be filed, which documents will be subject to review and approval of such counsel), use its best efforts to file all such qualifications as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holders’ Registrable Securities as are specified in such request (and to avoid the issuance of (or if issued, obtain the withdrawal of) any order suspending the effectiveness of a registration statement, or the lifting of any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction as soon as possible), and, together with all or such portion of the Registrable Securities of any Holders or Other Holders joining in such request as are specified in a written request given within fifteen (15) days after such notice from the Company is delivered to such Holder, provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance, pursuant to this Section 3.3:

(i) if Form S-3 is not available for such offering by the Holders;

(ii) if the Holders, together with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities and such other securities (if any) at an aggregate price to the public of less than $5,000,000;

(iii) if the Company shall furnish to Holders requesting a registration statement pursuant to this Section 3.3 a certificate signed by the Company’s Chief Executive Officer or Chairman of the Board stating that in the good faith judgment of the Board of Directors of the Company, it would be materially detrimental to the Company and its stockholders for such registration statement to be effected at such time, in which event the Company shall have the right to defer such filing for a period of not more than ninety (90) days after receipt of the request of the Initiating Holders, provided that such right shall be exercised by the Company not more than once in any twelve (12)-month period;

(iv) if the Company has, within the six (6) month period preceding the date of such request, already effected one registration on Form S-3 for the Holders pursuant to this Section 3.3;

(v) if the Company has already effected four registrations on Form S-3 for the Holders pursuant to this Section 3.3; or

(vi) in any particular jurisdiction in which the Company would be required to qualify to do business or to execute a general consent to service of process in effecting such registration, qualification or compliance.

(c) If the Initiating Holders intend to distribute the Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to this Section 3.3 and the Company shall include such information in the written notice referred to in Section 3.3(a). The provisions of Section 3.2(b) shall be applicable to such request (with the substitution of Section 3.3 for references to Section 3.2).

Section 3.4 Obligations of the Company . Whenever required under this Article III to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible:

(a) prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Act with respect to the disposition of all securities covered by such registration statement during such period, which period shall not be less than six (6) months;

(b) furnish to the Holders such number of copies of a prospectus, including a preliminary prospectus, each amendment and supplement thereto, in conformity with the requirements of the Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them;

(c) use its best efforts to register and qualify the securities covered by such registration statement under such other securities or Blue Sky laws of such jurisdictions as shall be reasonably requested by the Holders, provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions;

(d) in the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter of such offering and take all such other actions as the Holders or the underwriters reasonably request in order to expedite or facilitate the disposition of such Registrable Securities;

(e) notify each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing and, at the request of any such seller, the Company will prepare a supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of such Registrable Securities, such prospectus will not contain an untrue statement of a material fact or omit to state any fact necessary to make the statement therein not misleading;

(f) cause all such Registrable Securities registered pursuant to this Article III to be listed on a national exchange or trading system and on each securities exchange and trading system on which similar securities issued by the Company are then listed;

(g) provide a transfer agent and registrar for all Registrable Securities registered pursuant hereunder and a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration;

(h) make available for inspection by any Holder, any underwriter participating in any disposition pursuant to such registration statement, and any attorney, accountant or other agent retained by any Holder or underwriter, all financial and other records, pertinent corporate documents and properties of the Company, and cause the Company’s officers, directors, employees and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant or agent in connection with such registration statement; and

(i) obtain a cold comfort letter from the Company’s independent public accountants in customary form and covering such matters customarily given or covered by independent public accountants in an underwritten public offering of securities, addressed to the Holders.

(j) Notwithstanding the provisions of this Article III, the Company shall be entitled to postpone or suspend, for a reasonable period of time (and in no event in excess of 90 days), the filing, effectiveness or use of, or trading under, any registration statement if the Company shall determine that any such filing or the sale of any securities pursuant to such registration statement would in the good faith judgment of the Board of Directors of the Company require disclosure of material nonpublic information that, if disclosed at such time, would be materially harmful to the interests of the Company and its stockholders; provided, however, that during any such period all executive officers and directors of the Company are also prohibited from selling securities of the Company (or any security of any of the Company’s subsidiaries or affiliates). In the event of the suspension of effectiveness of any registration statement pursuant to this Section 3.4, the applicable time period during which such registration statement is to remain effective shall be extended by that number of days equal to the number of days the effectiveness of such registration statement was suspended. No more than one (1) such suspension may be initiated in any twelve (12) month period.

Section 3.5 Information from Holder . It shall be a condition precedent to the obligations of the Company to take any action pursuant to this Article III with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Company such information regarding itself, the Registrable Securities held by it, and the intended method of disposition of such securities as shall be reasonably required to effect the registration of such Holder’s Registrable Securities.

Section 3.6 Expenses of Registration . All expenses other than underwriting discounts and commissions incurred in connection with registrations, filings or qualifications pursuant to Sections 3.2 and 3.3, including (without limitation) all registration, filing and qualification fees, printers’ and accounting fees, fees and disbursements of counsel for the Company and the reasonable fees and disbursements of one counsel for the selling Holders (which counsel shall be selected by selling Holders and Other Holders holding a majority of the securities included in such registration) shall be borne by the Company. Notwithstanding the foregoing, the Company shall not be required to pay for any expenses of any registration proceeding begun pursuant to Section 3.2 or Section 3.3 if the registration request is subsequently withdrawn at the request of the Holders of a majority of the Registrable Securities to be registered (in which case all participating Holders shall bear such expenses pro rata based upon the number of Registrable Securities that were to be included in the withdrawn registration), unless, in the case of a registration requested under Section 3.3, the Holders of a majority of the Registrable Securities agree to forfeit their right to one registration pursuant to Section 3.3 and provided, however, that if at the time of such withdrawal, the Holders have learned of a material adverse change in the condition, business or prospects of the Company from that known to the Holders at the time of their request and have withdrawn the request with reasonable promptness following their discovery of such material adverse change, then the Holders shall not be required to pay any of such expenses and shall retain their rights pursuant to Section 3.3.

Section 3.7 Delay of Registration . No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any such registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Article III.

Section 3.8 Indemnification . In the event any Registrable Securities are included in a registration statement under this Article III:

(a) To the extent permitted by law, the Company will indemnify and hold harmless each Holder, the partners, officers, directors and stockholders of each Holder, legal counsel and accountants for each Holder, any underwriter (as defined in the Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Act or the 1934 Act, against any losses, claims, damages or liabilities (joint or several) to which they may become subject under the Act, the 1934 Act, any state securities laws or any rule or regulation promulgated under the Act, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or violations (collectively a “Violation”): (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state in such registration statement a material fact required to be stated therein, or necessary to make the statements therein not misleading or (iii) any violation or alleged violation by the Company of the Act, the 1934 Act, any state securities laws or any rule or regulation promulgated under the Act, the 1934 Act or any state securities laws, and the Company will reimburse each such Holder, underwriter, controlling person or other aforementioned person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that the indemnity agreement contained in this subsection 3.8(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld), nor shall the Company be liable in any such case for any such loss, claim, damage, liability or action to the extent that it arises out of or is based upon a Violation that occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such registration by any such Holder, underwriter, controlling person or other aforementioned person; provided further, however, that the foregoing indemnity agreement with respect to any preliminary prospectus shall not inure to the benefit of any Holder or underwriter or other aforementioned person, or any person controlling such Holder or underwriter, from whom the person asserting any such losses, claims, damages or liabilities purchased shares in the offering, if a copy of the most current prospectus was not sent or given by or on behalf of such Holder or underwriter or other aforementioned person to such person, if required by law to have been so delivered, at or prior to the written confirmation of the sale of the shares to such person, and if the prospectus (as so amended or supplemented) would have cured the defect giving rise to such loss, claim, damage or liability.

(b) To the extent permitted by law, each selling Holder will indemnify and hold harmless the Company, each of its directors, each of its officers who has signed the registration statement, each person, if any, who controls the Company within the meaning of the Act, legal counsel and accountants for the Company, any underwriter, any other Holder selling securities in such registration statement and any controlling person of any such underwriter or other Holder, against any losses, claims, damages or liabilities (joint or several) to which any of the foregoing persons may become subject, under the Act, the 1934 Act, any state securities laws or any rule or regulation promulgated under the Act, the 1934 Act or any state securities laws, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder expressly for use in connection with such registration; and each such Holder will reimburse any person intended to be indemnified pursuant to this subsection 3.8(b) for any legal or other expenses reasonably incurred by such person in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that the indemnity agreement contained in this subsection 3.8(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Holder (which consent shall not be unreasonably withheld), and provided that in no event shall any indemnity under this subsection 3.8(b) exceed the net proceeds from the offering received by such Holder.

(c) Promptly after receipt by an indemnified party under this Section 3.8 of notice of the commencement of any action (including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 3.8, deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party (together with all other indemnified parties that may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the fees and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, if prejudicial to its ability to defend such action, shall relieve such indemnifying party of liability to the indemnified party under this Section 3.8 to the extent of such prejudice, but the omission to so deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 3.8.

(d) If the indemnification provided for in this Section 3.8 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim, damage or expense referred to herein, then the indemnifying party, in lieu of indemnifying such indemnified party hereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such loss, liability, claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and the indemnified party on the other hand in connection with the statements or omissions that resulted in such loss, liability, claim, damage or expense, as well as any other relevant equitable considerations; provided, however, that no contribution by any Holder, when combined with any amounts paid by such Holder pursuant to Section 3.8(b), shall exceed the net proceeds from the offering received by such Holder. The relative fault of the indemnifying party and the indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

(e) Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control.

(f) The obligations of the Company and Holders under this Section 3.8 shall survive the completion of any offering of Registrable Securities in a registration statement under this Article III and otherwise.

Section 3.9 Assignment of Registration Rights . The rights to cause the Company to register Registrable Securities pursuant to this Article III may be assigned (but only with all related obligations) by a Holder to a transferee or assignee of such securities that (i) is a subsidiary, parent, partner, limited partner, retired partner, member, former member, stockholder or affiliate of a Holder, (ii) is a Holder’s family member or trust for the benefit of an individual Holder, or (iii) after such assignment or transfer, holds at least 25% of the Registrable Securities (subject to appropriate adjustment for stock splits, stock dividends, combinations or the like) held by such Holder immediately prior to such assignment or transfer, provided: (a) the transferee or assignee is not a direct competitor of the Company or an affiliate of a direct competitor of the Company, (b) the Company is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned and (c) such transferee or assignee agrees in writing to be bound by and subject to the terms and conditions of this Agreement.

Section 3.10 “ Market Stand-Off” Agreement .

(a) Each Holder hereby agrees that it will not, without the prior written consent of the managing underwriter, during the period commencing on the date of the final prospectus relating to the Company’s Initial Offering and ending on the date specified by the Company and the managing underwriter (such period not to exceed one hundred eighty (180) days) (i) lend, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock held immediately prior to the effectiveness of the Registration Statement for such offering, or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or other securities, in cash or otherwise. The foregoing provisions of this Section 3.10 shall apply only to the Initial Offering of equity securities, and shall (i) not apply to the sale of any shares to an underwriter pursuant to an underwriting agreement, (ii) not apply to any Holder that owns less than one percent of the issued and outstanding common stock of the Company, and (iii) only be applicable to the Holders if all officers, directors and greater than one percent (1%) stockholders of the Company enter into similar agreements. The underwriters in connection with the Company’s Initial Offering are intended third-party beneficiaries of this Section 3.10 and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. Each Holder further agrees to execute such agreements as may be reasonably requested by the underwriters in the Company’s Initial Offering that are consistent with this Section 3.10 or that are necessary to give further effect thereto. Notwithstanding the foregoing, the prior written consent of the managing underwriter shall not be required for an assignment of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock by a Holder to a transferee or assignee that is a subsidiary, parent, partner, limited partner, retired partner, member, former member, stockholder or affiliate of a Holder, provided however, that such transferee or assignee agrees in writing to be bound by and subject to the provisions of this Section 3.10.

In order to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Registrable Securities of each Holder (and the shares or securities of every other person subject to the foregoing restriction) until the end of such period.

(b) Each Holder that owns more than one percent of the issued and outstanding common stock of the Company agrees that a legend reading substantially as follows shall be placed on all certificates representing all Registrable Securities of each Holder (and the shares or securities of every other person subject to the restriction contained in this Section 3.10):

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A LOCK-UP PERIOD OF UP TO 180 DAYS AFTER THE EFFECTIVE DATE OF THE ISSUER’S REGISTRATION STATEMENT FILED UNDER THE ACT, AS AMENDED, AS SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE ORIGINAL HOLDER OF THESE SECURITIES, A COPY OF WHICH MAY BE OBTAINED AT THE ISSUER’S PRINCIPAL OFFICE. SUCH LOCK-UP PERIOD IS BINDING ON TRANSFEREES OF THESE SHARES.

Section 3.11 Termination of Rights . No Holder shall be entitled to exercise any right provided for in this Agreement after three (3) years following the consummation of the Initial Offering, or (ii) as to any Holder, such earlier time after the Initial Offering at which such Holder (A) can sell all shares held by it in compliance with Rule 144 or (B) holds one percent (1%) or less of the Company’s outstanding Common Stock and all Registrable Securities held by such Holder (together with any affiliate of the Holder with whom such Holder must aggregate its sales under Rule 144) can be sold in any three (3)-month period without registration in compliance with Rule 144.

ARTICLE IV

Miscellaneous

Section 4.1 Successors and Assigns . Except as otherwise provided herein, the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties (including transferees of any shares of Registrable Securities). Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

Section 4.2 Governing Law . This Agreement shall be governed by and construed under the laws of the State of Delaware.

Section 4.3 Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

Section 4.4 Titles and Subtitles . The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

Section 4.5 Notices . All notices and other communications given or made pursuant hereto shall be in writing and shall be deemed effectively given: (i) upon personal delivery to the party to be notified, (ii) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient; if not, then on the next business day, (iii) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the respective parties at the addresses set forth on the signature pages attached hereto (or at such other addresses as shall be specified by notice given in accordance with this Section 4.5).

Section 4.6 Expenses . If any action at law or in equity is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled.

Section 4.7 Entire Agreement; Amendments and Waivers . This Agreement (including the Exhibits hereto, if any) constitutes the full and entire understanding and agreement among the parties with regard to the subjects hereof and thereof. Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of the Company and the Securityholders’ Representative. Any amendment or waiver effected in accordance with this paragraph shall be binding upon each holder of any Registrable Securities, each future holder of all such Registrable Securities, and the Company.

Section 4.8 Severability . If one or more provisions of this Agreement are held to be unenforceable under applicable law, such provision(s) shall be excluded from this Agreement and the balance of the Agreement shall be interpreted as if such provision(s) were so excluded and shall be enforceable in accordance with its terms.

Section 4.9 Aggregation of Stock . All shares of Registrable Securities held or acquired by affiliated entities (including affiliated venture capital funds) or persons shall be aggregated together for the purpose of determining the availability of any rights under this Agreement.

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

	COMPANY:

	AEMETIS, INC.

	By: /s/ Eric A. McAfee
	Name: Eric A. McAfee
	Title: Chief Executive Officer

	ADDRESS: ____________________________________ ____________________________________ ____________________________________

	SECURITYHOLDERS’ REPRESENTATIVE WESTERN MILLING INVESTORS, LLC

	By: /s/ Kevin Kruse
	Name: Kevin Kruse
	Title: Manager

	ADDRESS: ____________________________________ ____________________________________ ____________________________________

EXHIBIT 10.2

THIRD EYE CAPITAL CORPORATION

as “ Administrative Agent”

and

THE NOTEHOLDERS PARTY HERETO

as the “Noteholders”

and

AEMETIS ADVANCED FUELS KEYES, INC.

and

KEYES FACILITY ACQUISITION CORP.

as “ Borrowers ”

and

AEMETIS, INC.

as the “ Parent ”

________________________________________________________________

AMENDED AND RESTATED NOTE PURCHASE AGREEMENT

July 6 , 2012

_______________________________________________________________

TABLE OF CONTENTS

ARTICLE 1
INTERPRETATION

Section 1.1	Defined Terms	2
Section 1.2	Meaning of “outstanding” for certain purposes	25
Section 1.3	Certain Phrases, etc.	25
Section 1.4	Interpretation Not Affected by Headings	26
Section 1.5	Statute References	26
Section 1.6	Currency	26
Section 1.7	Non-Business Day	26
Section 1.8	Invalidity of Provisions	26
Section 1.9	Governing Law	27
Section 1.10	Service	27
Section 1.11	Paramountcy	27
Section 1.12	Number and Gender	28
Section 1.13	Time of the Essence	28
Section 1.14	Accounting Terms	28

ARTICLE 2
THE NOTES

Section 2.1	Purchase of the Notes	28
Section 2.2	Conditions Precedent to Purchase of Notes	28
Section 2.3	Creation and Issuance of the Notes	32
Section 2.4	Subsequent Closings and Revolving Notes	32
Section 2.5	Description of Notes	32
Section 2.6	Place of Payment	33
Section 2.7	Form of Notes	33
Section 2.8	Legend	33
Section 2.9	Execution of Notes	34
Section 2.10	Certification	34
Section 2.11	Interest and Payments	35
Section 2.12	Replacement of Notes	35
Section 2.13	Option of Holder as to Place of Payment	36
Section 2.14	Record of Payments	36
Section 2.15	Surrender for Cancellation	36
Section 2.16	Notes to Rank Pari Passu	36
Section 2.17	No Setoff	36
Section 2.18	Use of Proceeds	37
Section 2.19	Taxes and Other Taxes	37

( i )

ARTICLE 3
REGISTRATION, TRANSFER, EXCHANGE AND OWNERSHIP OF NOTES

Section 3.1	Registration	38
Section 3.2	Transfer of Notes	38
Section 3.3	Transferee Entitled to Registration	39
Section 3.4	Exchange of Notes	39
Section 3.5	Ownership of Notes and Entitlement to Payment	39
Section 3.6	Restriction on Transfer of Notes under U.S. Securities Laws	40
Section 3.7	No Notice of Trusts	40

ARTICLE 4
REDEMPTION

Section 4.1	Mandatory Tiered Redemption of Notes	40
Section 4.2	Redemption on Occurrence of Certain Events	41
Section 4.3	Option to Redeem	42
Section 4.4	Notice to Redeem	42
Section 4.5	Manner of Redemption	42
Section 4.6	Cancellation of Notes on Redemption	42

ARTICLE 5
SECURITY

Section 5.1	Company Security Documents	43
Section 5.2	Other Obligor Guarantees and Security Documents	43
Section 5.3	Registration of the Security	44
Section 5.4	Blocked Account Agreements	44
Section 5.5	After Acquired Property and Further Assurances	44

ARTICLE 6
COVENANTS OF THE COMPANY

Section 6.1	Information Covenants	45
Section 6.2	Financial Covenants	48
Section 6.3	Affirmative Covenants	48
Section 6.4	Negative Covenants	56

ARTICLE 7
REPRESENTATIONS AND WARRANTIES

Section 7.1	Representations and Warranties	59

ARTICLE 8
DEFAULT AND ENFORCEMENT

Section 8.1	Event of Default	65
Section 8.2	Acceleration on Default	68
Section 8.3	Waiver of Default	68
Section 8.4	Enforcement by the Noteholders	69
Section 8.5	Right of Setoff	69
Section 8.6	Application of Moneys	70
Section 8.7	Remedies Cumulative	70
Section 8.8	Judgment Against the Borrowers	70
Section 8.9	Administrative Agent May Perform Covenants	71

( ii )

ARTICLE 9
SATISFACTION AND DISCHARGE

Section 9.1	Cancellation	71
Section 9.2	Non-Presentation of Notes	71

ARTICLE 10
THE ADMINISTRATIVE AGENT AND NOTEHOLDERS

Section 10.1	Authorization and Action	71
Section 10.2	No Liability	72
Section 10.3	Administrative Agent as Noteholder	73
Section 10.4	Noteholder Credit Decisions	73
Section 10.5	Indemnification	73
Section 10.6	Liability of the Noteholders inter se	74
Section 10.7	Successor Administrative Agents	74

ARTICLE 11
NOTICES

Section 11.1	Notices	74

ARTICLE 12
MISCELLANEOUS

Section 12.1	Counterparts and Facsimile	76
Section 12.2	Language of Agreement	76
Section 12.3	No Strict Construction	76
Section 12.4	Complete Agreement	76
Section 12.5	Indemnification	76
Section 12.6	Acknowledgments	78
Section 12.7	Attorney	78
Section 12.8	Amendments and Waivers	78
Section 12.9	Successors and Assigns	79
Section 12.10	Waiver of Right to Jury Trial	79
Section 12.11	Waiver and Acknowledgement	80
Section 12.12	Announcements	80
Section 12.13	Maximum Rate of Interest	80
Section 12.14	Judgment Currency	80
Section 12.15	Interest on Amounts	81
Section 12.16	Severability	81
Section 12.17	Survival	81
Section 12.18	Confidentiality	81
Section 12.19	Patriot Act	82
Section 12.20	Ratification and Reaffirmation	82
Section 12.21	Release	82
Section 12.22	Representations of each Noteholder	83

( iii )

EXHIBITS AND SCHEDULES

Exhibit A –	Form of Compliance Certificate
Exhibit B –	Form of Revolving Loan Request
Exhibit C-1 –	Form of Acquisition Note
Exhibit C-2 –	Form of Existing Note
Exhibit C-3 –	Form of Revenue Participation Note
Exhibit C-4 –	Form of Revolving Note

Schedule 1.1(a)	Subordinated Debt
Schedule 1.1(b)	Permitted Liens
Schedule 7.1(a)	Incorporation and Qualification
Schedule 7.1(l)	Ownership of Properties
Schedule 7.1(t)	Environmental Compliance
Schedule 7.1(x)	Corporate Structure
Schedule 7.1(z)	Indebtedness
Schedule 7.1(aa)	Litigation
Schedule 7.1(bb)(i)	Jurisdictions
Schedule 7.1(bb)(ii)	Authorizations
Schedule 7.1(bb)(iii)	Intellectual Property
Schedule 7.1(bb)(iv)	Proceedings
Schedule 7.1(bb)(v)	Material Contracts
Schedule 7.1(bb)(vi)	Settlement Agreements
Schedule 7.1(cc)	Insolvency
Schedule 7.1(ee)	Transactions with Related Parties

( iv )

AMENDED AND RESTATED NOTE PURCHASE AGREEMENT

This Amended and Restated Note Purchase Agreement (as the same may be further amended, modified, extended, renewed, restated, replaced or supplemented from time to time, this “ Agreement ”) is dated as of July 6, 2012 by and among AEMETIS ADVANCED FUELS KEYES, Inc. , a corporation incorporated and existing under the laws of the State of Delaware and formerly known as AE Advanced Fuels Keyes, Inc. (together with its successors and permitted assigns, “ AEAFK ”), KEYES FACILITY ACQUISITION CORP. , a corporation incorporated and existing under the laws of the State of Delaware and an Affiliate of AEAFK (together with its successors and permitted assigns, “ Acquisition Corp. ” and collectively with AEAFK, the “ Borrowers ”), AEMETIS, INC. , a corporation incorporated and existing under the laws of the State of Nevada and formerly known as AE Biofuels, Inc. (together with its successors and permitted assigns, the “Parent” ), THIRD EYE CAPITAL CORPORATION , as agent for the Noteholders (together with its successors in such capacity, and their respective successors and assigns, the “ Administrative Agent ”), and THE NOTEHOLDERS FROM TIME TO TIME PARTY HERETO .

WHEREAS :

AEAFK, the Administrative Agent and certain Noteholders entered into a Note Purchase Agreement dated as of October 18, 2010, as amended by an Amendment No. 1 to Note Purchase Agreement dated as of March 10, 2011, as further amended by a Limited Waiver and Amendment No. 2 to Note Purchase Agreement dated as of June 20, 2011, as further amended by a Limited Waiver and Amendment No. 3 to Note Purchase Agreement dated as of August 31, 2011, as further amended by a Limited Waiver and Amendment No. 4 to Note Purchase Agreement dated as of November 8, 2011, as further amended by a Limited Waiver, Consent and Amendment No. 5 to Note Purchase Agreement dated as of January 31, 2012, as further amended by Amendment No. 6 to Note Purchase Agreement dated as of April 13, 2012 and as further amended by a Limited Waiver and Amendment No. 7 to Note Purchase Agreement dated as of May 15, 2012 (the “ Original Note Purchase Agreement ”) pursuant to which the Noteholders have acquired notes of AEAFK.

Parent, AE Advanced Fuels, Inc., a corporation incorporated and existing under the laws of the State of Delaware and Cilion, Inc., a corporation incorporated and existing under the laws of the State of Delaware (“ Cilion ”) have entered into an Agreement and Plan of Merger dated as of July 6, 2012 (the “ Merger Agreement ”) pursuant to which Acquisition Corp. will merge with and into Cilion with Cilion continuing as the surviving corporation (the “ Acquisition ”) in accordance with the terms and conditions set forth therein, and by operation of law, Cilion shall assume the obligations of Acquisition Corp. hereunder and immediately following the Acquisition, Cilion will change its name to Aemetis Facility Keyes, Inc.

Parent and AE Advanced Fuels, Inc. are obligated pursuant to the Merger Agreement to pay the merger consideration described therein to the former shareholders of Cilion and in connection therewith the Borrowers have requested that the Noteholders invest the aggregate sum of $15,000,000 in exchange for the Acquisition Notes (as defined below).

The Borrowers have requested that the Noteholders invest up to an additional aggregate sum $18,000,000 in the Borrowers on a revolving basis in exchange for the Revolving Notes (as defined below).

The Noteholders have agreed to cancel all future Revenue Participation (as defined in the fee letter dated October 18, 2010 from Agent to AEAFK and the Parent, as amended by the fee letter dated March 10, 2011), and exchange the accrued and unpaid Revenue Participation in the amount of $8,070,973.60 as of May 31, 2012 for the Revenue Participation Notes (as defined below).

The parties hereto desire to amend and restate in its entirety the Original Note Purchase Agreement (without such amendment and restatement constituting a novation thereof) to set forth herein their mutual understandings and agreements pertaining to the transactions contemplated herein.

G .

The Borrowers are desirous of creating, issuing and selling certain additional Notes (as hereinafter defined), the issuance of which is provided for by this Agreement;

H .

The Borrowers, under the laws relating thereto, are duly authorized to create, issue and sell the Notes to be issued as herein provided to evidence indebtedness of the Borrowers existing on the date hereof or incurred by the Borrowers at any time hereafter in accordance with the terms of this Agreement;

I .

All necessary resolutions of the Directors (as hereinafter defined) of the Borrowers have been duly passed and other proceedings taken and conditions complied with to make the creation and issue of the Notes proposed to be issued hereunder and this Agreement and the execution thereof and hereof legal, valid and effective;

NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the foregoing recitals, the entering into of the Financing Documents (as defined below) by the Parties and their affiliates, as applicable, which form an integral part of this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, it is hereby agreed and declared as follows:

ARTICLE 1

INTERPRETATION

Section 1.1 Defined Terms

For the purposes of this Agreement, the following terms have the meanings set forth below:

“Acquisition” has the meaning set forth in the Recitals.

“ AcquisitionNotes ” means, collectively, the notes dated as of the date of this Agreement in the aggregate original principal amount of $15,000,000 in the form attached hereto as Exhibit C-1 issued by the Borrowers made payable to the Noteholders.

“ Acquisition Notes Interest Rate ” means (a) Prime Rate plus 6.75% per annum if the aggregate outstanding principal balance of the Acquisition Notes is less than $5,000,000, (b) Prime Rate plus 8.75% per annum if the aggregate outstanding principal balance of the Acquisition Notes is equal to or greater than $5,000,000 but less than $10,000,000 and (c) Prime Rate plus 10.75% per annum if the aggregate outstanding principal balance of the Acquisition Notes is equal to or greater than $10,000,000.

“Acquisition Notes Stated Maturity Date” means the second anniversary of the date of this Agreement .

“ Acquisition NotesRedemption Fee ” has the meaning set forth in the Fee Letter .

“ Acquisition Documents ” means, collectively, the Merger Agreement and all other instruments and documents executed and delivered in connection with the Acquisition.

“ Additional Monthly Base Redemption Amount ” has the meaning set forth in Section 4.1.

“ Administrative Agent ” has the meaning set forth in the Recitals.

“ AEAFK ” has the meaning set forth in the Recitals.

“Affairs” means the property, assets, nature of assets, business, results of operations, performance, liabilities, prospects or condition (financial or otherwise) of a specified Person.

“ Affiliate ” means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified. “Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

“Agreed Use of Proceeds” means the use of proceeds submitted to the Administrative Agent by the Parent and approved by the Administrative Agent prior to the First Closing.

“ Agreement ” has the meaning set forth in the Recitals.

“Allocation Notice ” means the letter dated as of the date hereof from the Administrative Agent to the Parent and the Borrowers setting forth the allocation of the Notes between the Noteholders, as amended from time to time after the date hereof by a subsequent letter from the Administrative Agent to the Noteholders.

“Amount to be Redeemed” has the meaning given thereto in Section 4.4 .

“Annual Business Plan” means the annual business plan of the Parent, prepared on a consolidated basis, with financial projections and budgets on an annual basis, in each case consisting of a balance sheet, statement of income, statement of cash flows, proposed capital expenditures and a list of assumptions upon which such projections are based.

“ Applicable Law ” means any international treaty, any domestic or foreign constitution or any supranational, regional, federal, provincial, territorial, state, municipal, tribal or local statute, law, ordinance, code, rule, regulation, order (including any consent decree or administrative order), applicable to, or any directive, guideline, policy or Authorization of any Governmental Entity having jurisdiction with respect to any specified Person, property, transaction or event or any of such Person’s Affairs, and any order, judgment, award or decree of any Governmental Entity, or arbitrator in any proceeding or action to which the Person in question is a party or by which such Person or any of its Affairs is bound.

“ Applicable Interest Rate ” means, as applicable, the Acquisition Notes Interest Rate, the Existing Notes Interest Rate, the Revolving Notes Interest Rate and the Revenue Participation Notes Interest Rate.

“ Applicable Stated Maturity Date ” means, as applicable, the Acquisition Notes Stated Maturity Date, the Existing Notes Stated Maturity Date, the Revolving Notes Stated Maturity Date and the Revenue Participation Stated Notes Maturity Date.

“Authorization” means any authorization, approval, consent, exemption, licence, permit, franchise or no-action letter from any Governmental Entity having jurisdiction with respect to any specified Person, the Properties, property, transaction or event, or any of such Person’s Affairs or from any Person in connection with any contractual or other rights .

“ Blocked Accounts ” means those deposit accounts of the Parent, any Borrower,and any other Obligor, which are the subject of the Blocked Account Agreements.

“ Blocked Account Agreements ” means, in respect of the deposit accounts of the Parent, any Borrower and of any other Obligor, those certain blocked account agreements and deposit account control agreements among the applicable Blocked Account Provider with respect to such deposit account, the Administrative Agent, a Borrower, the Parent or the other relevant Obligor , in each case, in form and substance satisfactory to the Administrative Agent, as the same may be amended, supplemented, modified or replaced from time to time.

“ Blocked Account Provider ” means each depositary, bank, financial institution or other Person identified as such in the Blocked Account Agreements and their respective successors in connection with their respective responsibilities for providing and servicing the Blocked Accounts.

“Board” means the Board of Directors of the Parent existing from time to time.

“ Borrower ” has the meaning set forth in the Recitals.

“Buildings and Fixtures” means all plant, buildings, structures, erections, Improvements, appurtenances and fixtures (including affixed machinery and affixed equipment) situate on any of the Properties.

“Business” means (a) the business engaged in by the Parent and the Borrowers as of the First Closing Date, (b) business that is reasonably related thereto and (c) such other lines of business approved by the Administrative Agent.

“ Business Day ” means any day other than Saturday, Sunday or a statutory holiday when banks are not open in Cupertino, California or Toronto, Ontario .

“Capital Expenditures” means all expenditures made by a Person required to be capitalized in accordance with GAAP.

“ Capital Lease ” means, with respect to a Person, a lease or other arrangement in respect of real or personal property that is required to be classified and accounted for as a capital lease obligation on a balance sheet of the Person in accordance with GAAP .

“ Capital Lease Obligation ” means, with respect to a Person, the obligation of the Person to pay rent or other amounts under a Capital Lease and for the purposes of this definition, the amount of such obligation at any date shall be the capitalized amount of such obligation at such date as determined in accordance with GAAP .

“ Capital Stock ” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent interests in a Person (other than a corporation) , and any and all warrants, rights or options to purchase any of the foregoing.

“Cash Equivalents” means (i) investment grade securities issued, guaranteed or insured by the United States of America or any state, and having terms to maturity of not more than one year, and (ii) time deposits and certificates of deposit having maturities of not more than one year of any domestic commercial bank of recognized standing and investment grade credit rating having net capital in excess of $500,000,000.

“Chairman” means Eric McAfee.

“Chairman’s Pledge Agreement” means the Amended and Restated Pledge Agreement of even date herewith granted by McAfee Capital, LLC, which is owned 100% by the Chairman, to the Administrative Agent for the benefit of the Secured Parties, pledging ten million shares of Capital Stock held by McAfee Capital, LLC in the capital of the Parent, as the same may be amended, modified, extended, renewed, restated, replaced or supplemented from time to time.

“ Change of Control ” means the occurrence of any of the following events:

(a)

there is consummated any amalgamation, consolidation, statutory arrangement (involving a business combination), merger of the Parent or similar transaction (i) in which the Parent is not the continuing or surviving corporation, or (ii) pursuant to which any Voting Shares of the Parent would be reclassified, changed or converted into or exchanged for cash, securities or other property, other than (in each case) an amalgamation, consolidation, statutory arrangement, merger of the Parent or similar transaction in which the holders of the Voting Shares of the Parent immediately prior to the amalgamation, consolidation, statutory arrangement, merger or similar transaction have, directly or indirectly, more than 50% of the Voting Shares of the continuing or surviving corporation immediately after such transaction;

(b)

any Person or group of Persons shall succeed in having a sufficient number of its nominees elected to the Board such that such nominees, when added to any existing Director remaining on the Board after such election who was a nominee of or is an Affiliate or related Person of such Person or group of Persons, will constitute a majority of the Board; provided, however, that no Change of Control shall be deemed to occur in connection with the appointment of a nominee in the event of the death, retirement or removal of an existing Director;

(c)

any “person or “group” (as such terms are used in Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”)), other than the Permitted Investors, shall become, or obtain rights (whether by means or warrants, options or otherwise) to become, the “beneficial owner (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of more than 20% of the outstanding Voting Shares of Parent;

(d)

the Parent shall cease to own and control, of record and beneficially, directly, 100% of each class of outstanding Capital Stock of any Borrower or other direct or indirect Subsidiary of the Parent free and clear of all Liens (except Liens created by the Security Documents and Liens securing other obligations of the Obligors pursuant to the Financing Documents);

(e)	any sale of all or substantially all of the assets of any of the Company Parties;

(f)	the Chairman ceases to own, directly or indirectly, at least 10 million shares of the Capital Stock of the Parent;

(g)	any sale of the Keyes Plant;

(h)	Eric McAfee ceases to be the Chairman of the Parent or any Borrower or employed as the Chief Executive Officer of the Parent or any Borrower; or

(i)

the execution by any Company Party or any Affiliateof any Company Party of any agreement, letter of intent, commitment, arrangement, or understanding with respect to any proposed transaction or event or series of transactions or events that, individually or in the aggregate, may reasonably be expected to result in any of the events in (a) through (h) above or the execution of any written agreement that, when fully performed by the parties thereto, would result in any of the events in (a) through (h) above.

“ Cilion ” has the meaning set forth in the Recitals.

“ Closing ” means the purchase and sale of the Notes as contemplated herein, including the First Closing and the Subsequent Closings.

“ Closing Date ” means, in respect of each Closing, the date upon which all of the conditions in Section 2.2have been fulfilled or waived and the purchase and sale of Notes has occurred in connection with such Closing.

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“ Collateral ” means any and all property and assets in respect of which the Administrative Agent or any other Secured Party has or will have or is intended to have a Lien pursuant to a Security Document, including (i) the Keyes Plant, (ii) allpersonal propertyand other Equipment of each Company Party, (iii) the other Properties,(iv) all cash and securities of each Company Party, including, without limitation, cash and securitiesin the Blocked Accounts, (v) all Leases, and all other assets and interests and all proceeds and products thereof and rights of insurance policies, (vi) all Capital Stock pledged or intended to be pledged by the Parent in the other Company Parties, (vii) all Capital Stock pledged or intended to be pledged by the Chairman pursuant to the Chairman’s Pledge Agreement, and (viii) all other collateral and/or security granted and/or securities pledged by a Company Party to the Administrative Agent, the other Secured Parties or any other Person pursuant to the Security Documents to secure the Note Indebtedness, together with all books and records relating to the foregoing.

“Common Shares ” means the issued and outstanding common shares in the capital of the Parent .

“Commonly Controlled Entity” means an entity, whether or not incorporated, that is under common control with the Parent within the meaning of Section 4001 of ERISA or is part of a group that includes the Parent and that is treated as a single employer under Section 414 of the Code.

“Company Parties” means, collectively, the Parentand all direct and indirect Subsidiaries of the Parent; provided, however, the term Company Parties shall not include International Biofuels Ltd., a corporation formed under the laws of Mauritius, Universal Biofuels Private, Ltd., a corporation formed under the laws of India and Sutton Ethanol, LLC, a limited liability company formed under the laws of State of Nebraska.

“Compliance Certificate” means a certificate of the Parentsubstantially in the form of Exhibit A , signed by a Senior Officer of the Parent .

“ Consolidated Entities ” means, for any Person, such Person and each of its Subsidiaries (whether now existing or hereafter created or acquired) the financial statements of which shall be (or should have been) consolidated with the financial statements of the Parent in accordance with GAAP .

“ Consolidated Net Income ” means, for any period, the net income (or loss) of a Person and its Consolidated Entities for such period determined on a consolidated basis in accordance with GAAP, but excluding the income of any other Person (other than its Consolidated Entities) in which such Person or any Consolidated Entity has an ownership interest, unless received by such Person or such Consolidated Entity, as the case may be, in a cash distribution.

“Consolidated Unfunded Capital Expenditures” means the amount of all capital expenditures of a Person and its Consolidated Entities, determined on a consolidated basis, to the extent not financed or to be financed by the proceeds of Indebtedness or Capital Stock of the Company Parties.

“ Deemed Year ” has the meaning ascribed to such term in Section 2.11 .

“Default” means an event which, with the giving of notice or the passage of time, or both, would constitute an Event of Default.

“ Default Rate ” means the rate of interest per annum equal to 600 basis points per annum over the Applicable Interest Rate applicable to the applicable Note .

“ Director ” means a director of the Parent for the time being and “ Directors ” means the board of directors of the Parent or, whenever duly empowered, a committee of the board of directors of the Parent, and reference to action by the Directors means action by the directors as a board or action by such a committee of the Board as a committee.

“Distribution” means with respect to any Person the amount of (i) any dividend or other distribution on issued Capital Stock of the Person or any of its Subsidiaries, (ii) the purchase, redemption or retirement amount of any issued equity, warrants or any other options or rights to acquire Capital Stock of the Person or any of its Subsidiaries redeemed or purchased by the Person or any its Subsidiaries, or (iii) any payments, whether as consulting fees, management fees, repayment of indebtedness or otherwise (other than salaries or wages paid in the ordinary course and otherwise permitted by this Agreement) to any Related Party of the Person or any of its Subsidiaries .

“ EnvironmentalLaws ” shall mean any applicable foreign, federal, state or local governmental laws (including common laws), statutes, ordinances, codes, regulations, rules, policies, permits, licenses, certificates, approvals, judgments, decrees, orders, directives, or requirements that pertain to the protection of the environment, protection of public health and safety, or that pertain to the handling, use, manufacturing, processing, storage, treatment, transportation, discharge, release, emission, disposal, re-use, recycling, or other contact or involvement with Hazardous Materials (as defined in Section 3.18(a)(ii)), including, without limitation, the federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Section 9601, et seq., as amended (“CERCLA”), and the federal Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., as amended (“RCRA”).

“Environmental Site Assessment Report” means, with respect to the Properties, a Phase I environmental site assessment report prepared by an environmental consulting firm acceptable to the Administrative Agent, which report shall comply with ASTM standard 1527-05.

“Equipment” means all machinery and equipment owned and insured by any Company Party and required in the ordinary course of suchCompany Party’s business.

“ Event of Default ” has the meaning attributed thereto in Section 8.1 .

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with any Borrower, is treated as a single employer under Sections 414(b), 414(c), 414(m) or 414(o) of the Code, or solely for purposes of Section 302 or 303 of ERISA or Section 412 or 430 of the Code, is treated as a single employer under Section 414 of the Code.

“Existing Notes ” means, collectively, the amended and restated notes dated as of the date of this Agreement in the form attached hereto as Exhibit C-2 in the aggregate principal amount of $7,184,573.64 issued by the Borrowers made payable to the Noteholders.

“ ExistingNotes Interest Rate ” means (a) 14% per annum until such time that the Borrowers have made additional principal payments on the Existing Notes, in addition to the regularly scheduled redemption payments described in Article 4, after the date of this Agreement in the aggregate amount of $950,000 and (b) 12% thereafter.

“Existing Notes Stated Maturity Date” means October 18, 2012, provided , that the Existing Notes Maturity Date shall be extended for an additional period of six months so long as, at the time of such extension, (a) no Event of Default has occurred and is continuing under any Financing Document, (b) at least $15,000,000 in proceeds from the Program are held in escrow pending release to the Borrowers for repayment of the Existing Notes and (c) the Borrowers pay the Administrative Agent the Existing Notes Stated Maturity Date Extension Fee.

“ Existing Notes Stated Maturity Date Extension Fee ” has the meaning given to such term in the Fee Letter.

“Fee Letter” means the amended and restated letter agreement dated the date hereof among the Borrowers, the Parent and the Administrative Agent.

“Financial Assistance” means any advances, loans or other extensions of credit, guarantees, indemnities or other contingent liabilities in the nature of a guarantee or indemnity or capital contributions (other than prepaid expenses in the ordinary course of business) to (by means of transfers of property, money or assets), or any purchase of any Capital Stock, stocks, bonds, notes, debentures or other securities of, any Person or the acquisition of all or substantially all the assets of, any Person or of a business carried on by, or a division of, any Person. In determining the aggregate amount of Financial Assistance by any Company Party outstanding at any particular time, (i) take the amount of any investment represented by a guarantee or similar contingent obligation at not less than the principal amount of the obligations guaranteed and outstanding, (ii) deduct in respect of any Financial Assistance any amount received by suchCompany Party as return of capital (but only by repurchase, redemption, retirement, repayment, liquidating dividend or liquidating distribution), (iii) do not deduct in respect of any Financial Assistance any amounts received as earnings on such Financial Assistance, whether as dividends, interest or otherwise, and (iv) do not deduct from the aggregate amount of Financial Assistance any decrease in its market value.

“Financial Instrument” means any agreement pursuant to which Financial Instrument Obligations are created or incurred.

“ Financial Instrument Obligations ” means, with respect to any Person, obligations arising under:

(a)

interest rate swap agreements, forward rate agreements, floor, cap or collar agreements, futures or options, insurance or other similar agreements or arrangements, or any combination thereof, entered into or guaranteed by the Person where the subject matter thereof is interest rates or the price, value or amount payable thereunder is dependent or based upon interest rates or fluctuations in interest rates in effect from time to time (but excluding non-speculative conventional floating rate indebtedness);

(b)

currency swap agreements, cross-currency agreements, forward agreements, floor, cap or collar agreements, futures or options, insurance or other similar agreements or arrangements, or any combination thereof, entered into or guaranteed by the Person where the subject matter thereof is currency exchange rates or the price, value or amount payable thereunder is dependent or based upon currency exchange rates or fluctuations in currency exchange rates in effect from time to time; and

(c)

any agreement for the making or taking of any commodity (including coal, natural gas, oil and electricity, but specifically excluding any agreements for the sale of coal to brokers or end-users), swap agreement, floor, cap or collar agreement or commodity future or option or other similar agreement or arrangement, or any combination thereof, entered into or guaranteed by the Person where the subject matter thereof is any commodity or the price, value or amount payable thereunder is dependent or based upon the price or fluctuations in the price of any commodity;

or any other similar transaction, including any option to enter into any of the foregoing, or any combination of the foregoing, in each case to the extent of the net amount due or accruing due by the Person under the obligations determined by marking the obligations to market in accordance with their terms.

“Financing” means, collectively, (i) the issuance and sale by the Borrowers of $7,184,573.64 aggregate principal amount of Existing Notes pursuant to this Agreement, (ii) the issuance and sale by the Borrowers of $15,000,000 aggregate principal amount of Acquisition Notes pursuant to this Agreement, (iii) the issuance and sale by the Borrowers of $18,000,000 aggregate principal amount of Revolving Notes pursuant to this Agreement and (iv) the issuance and sale by the Borrowers of $10,000,000 aggregate principal amount of Revenue Participation Notes pursuant to this Agreement and (iv) the entry into by the parties thereto of the other transactions contemplated by the Financing Documents.

“ Financing Documents ” means the Note Purchase Documents, the Investor Rights Agreement, and all other documents to be executed and delivered to the Administrative Agent and the other Secured Parties, or any of them, by the Obligors from time to time in connection with the Financing, and including all amendments, modifications or replacements thereof and all supplements thereto.

“ First Closing ” means the purchase and sale of the Notes in the aggregate principal amount of up to $47,184,573.64, as contemplated herein.

“ First Closing Date ” means July 6, 2012, which is the date on which all of the conditions in Section 2.2 have been fulfilled or waived and the purchase and sale of the Notes has occurred in connection with the First Closing.

“ Fiscal Quarter ” means the three (3) month periods ended March 31 st , June 30 th , September 30 th and December 31 st of each Fiscal Year.

“ Fiscal Year ” means a twelve (12) month period ended December 31 st .

“Free Cash Flow” means, for any period, the Borrowers’ Consolidated Net Income for such period, increased by the sum of (without duplication) the aggregate amount of depreciation and amortization expense for such period, to the extent deducted in determining Consolidated Net Income for such period, and decreased by the sum of (without duplication) the aggregate amount of Unfunded Capital Expenditures made by the Borrowers in cash during such period to the extent approved by the Administrative Agent and payments on account of Indebtedness during such period.

“ GAAP ” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.

“Governmental Entity” means any (i) multinational, federal, provincial, state, municipal, local or other government, governmental or public department, central bank, court, commission, board, bureau, agency or instrumentality, domestic or foreign, (ii) any subdivision or authority of any of the foregoing, or (iii) any quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the above .

“ Guarantee ” means collectively, (i) the Amended and Restated Guaranty dated as of the date hereof from the Parent and the other Company Parties (other than the Borrowers) in favour of the Administrative Agent for the benefit of the Noteholders, (ii) the Amended and Restated Limited Guaranty dated as of the date hereof by Eric McAfee in favour of the Administrative Agent for the benefit of the Noteholders, (iii) the Amended and Restated Limited Recourse Guaranty dated as of the date hereof from McAfee Capital, LLC in favour of the Administrative Agent for the benefit of the Noteholders and (iv) any other guarantee of the Note Indebtedness of the Borrowers delivered to the Administrative Agent from time to time pursuant to this Agreement or otherwise, in each case, as the same may be amended, modified or restated from time to time .

“Hazardous Materials” means any material, chemical, compound, substance, mixture or by-product that is identified, defined, designated, listed, restricted or otherwise regulated under Environmental Laws as a “hazardous constituent,” “hazardous substance,” “hazardous material,” “acutely hazardous material,” “extremely hazardous material,” “hazardous waste,” “hazardous waste constituent,” “acutely hazardous waste,” “extremely hazardous waste,” “infectious waste,” “medical waste,” “biomedical waste,” “pollutant,” “toxic pollutant,” “contaminant” or any other formulation or terminology intended to classify or identify substances, constituents, materials or wastes by reason of properties that are deleterious to the environment, natural resources, worker health and safety, or public health and safety, including without limitation ignitability, corrosivity, reactivity, carcinogenicity, toxicity and reproductive toxicity. The term “Hazardous Materials” shall include without limitation any “hazardous substances” as defined, listed, designated or regulated under CERCLA, any “hazardous wastes” or “solid wastes” as defined, listed, designated or regulated under RCRA, any asbestos or asbestos-containing materials, any polychlorinated biphenyls, and any petroleum or hydrocarbonic substance, fraction, distillate or by-product. .

” Improvements” means all erections, buildings, fixtures, structures or their fixed improvements now, if any, or hereafter constructed, erected or located on, in, under or through the property to which they relate.

“ Indebtedness ” means, with respect to a Person, without duplication:

(a)	all obligations of the Person for borrowed money, including debentures, notes or similar instruments and other financial instruments and obligations with respect to bankers' acceptances and contingent reimbursement obligation relating to letters of credit;

(b)	all Financial Instrument Obligations of the Person;

(c)	all Capital Lease Obligations and Purchase Money Obligations of the Person;

(d)	all obligations to pay the deferred and unpaid purchase price of property or services other than for goods and services purchased in the ordinary course of business and paid for in accordance with customary practice and not represented by a note, bond, debenture or other evidence of indebtedness;

(e)	all obligations of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person;

(f)	all current liabilities of such Person represented by a note, bond, debenture or other evidence of indebtedness;

(g)	all indebtedness of any other Person secured by a Lien on any assets of the Person;

(h)	all obligations to repurchase, redeem or repay any securities of the Person prior to or concurrently with the Applicable Stated Maturity Date; and

(i)	all Financial Assistance of the Person with respect to obligations of another Person if such obligations are of the type referred to in clauses (a) to (h).

“ Indemnitee ” has the meaning set forth in Section 12.5.

“ Information ” has the meaning set forth in Section 12.18.

“Intellectual Property” means the collective reference to all rights, priorities and privileges relating to intellectual property, whether arising under United States, multinational or foreign laws or otherwise, including copyrights, copyright licenses, patents, patent licenses, trademarks, trademark licenses, technology, know-how and processes, and all rights to sue at law or in equity for any infringement or other impairment thereof, including the right to receive all proceeds and damages therefrom.

“Intercompany Indebtedness” means intercompany loans between Company Parties .

“ Interest Payment Date ” means the first Business Day of each month and the Maturity Date .

“ Investor Rights Agreement ” means the Investor Rights Agreement dated as of the date hereof among the Parent, the Administrative Agent and the Noteholders.

“ Issue Date ” means, in respect of any Note, the date upon which such Note is issued by the Borrowers to a Noteholder pursuant to the terms of this Agreement.

“ Keyes Plant ” means the ethanol plant located at 4209 Jessup Road, Keyes, California.

“ Keyes Plant Orderly Liquidation Value ” means the orderly liquidation value of the Keyes Plant as determined semi-annually by Natwick Associates or such other independent valuation expert acceptable to the Administrative Agent.

“Keyes Plant Market Value” means the market value of the Keyes Plant as determined semi-annually by Natwick Associates or such other independent valuation expert acceptable to the Administrative Agent.

“ knowledge ” means, with respect to a Party, the actual knowledge of such Party, after due and reasonable inquiry by such Party (including its appropriate officers and Directors) as considered necessary given the subject of such knowledge qualification.

“Leases” means the leases, subleases, rights to occupy and licences of or relating to real property or Buildings and Fixtures to which the Company Parties are a party (i) at the date of this Agreement, as listed and described in Schedule 7.1(l) or (ii) after the date of this Agreement as notified to the Administrative Agent pursuant to each Compliance Certificate, but shall exclude (iii) leases, rights and licences terminated in accordance with their terms (and not as the result of a default) or assigned or otherwise disposed of after the date of this Agreement as permitted by this Agreement.

“Lien” means any mortgage, charge, pledge, assignment, encumbrance, lien (statutory or otherwise), title retention agreement or arrangement, restrictive covenant or other encumbrance of any nature or any other arrangement or condition that in substance secures payment or performance of an obligation. The term “ Lien ” shall include easements, restrictions servitudes, permits, conditions, covenants, exceptions or reservations.

“ Material Adverse Effect ” means, when used with reference to any event or circumstance, an event or circumstance which, in the opinion of the Administrative Agent, acting reasonably, has or could reasonably be expected to have:

(d)	a material adverse effect on any of the Affairs of the Parent,any Borrower, the Company Parties taken as a whole, or the Consolidated Entities taken as a whole; or

(e)

a material adverse effect on (i) the ability of any Borrower or any other Obligor to perform their obligations under any of the Financing Documents or (ii) the Administrative Agent’s, the Administrative Agent's or any Noteholder's ability to enforce rights and remedies pursuant to any Financing Document or collect any of the Indebtedness due to any Secured Partyor any Investor pursuant to any Financing Document.

In determining whether any individual event would result in a Material Adverse Effect, notwithstanding that such event does not of itself have such effect, a Material Adverse Effect shall be deemed to have occurred if the cumulative effect of such event and all other existing events would result in a Material Adverse Effect.

“ Material Agreement ” means any material written or oral agreement or contract with a value in excess of $100,000 to which a Person is a party, by which such Person is bound, or to which any material assets of such Person are subject, which is not cancellable by such Person upon notice of thirty (30) days or less without liability for further payment other than nominal penalty.

“ Maturity Date ” means, with respect to each Note, the date on which the principal of such Note becomes due and payable as therein or herein provided, whether at the Applicable Stated Maturity Date thereof or by declaration, acceleration, redemption or otherwise.

“ Merger Agreement ” has the meaning set forth in the Recitals.

“ Minimum Monthly Base Redemption Amount ” has the meaning set forth in Section 4.1.

“Mortgages” means the collective reference to (a) the Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing dated as of the date hereof by Cilion Acquisition Corp. to First American Title Insurance Company in favour of the Administrative Agent, (b) the Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing dated as of the date hereof by AEAFK to First American Title Insurance Company in favour of the Administrative Agent, (c) the Memorandum of Lease dated as of the date hereby between Cilion and AEAFK and each other mortgage, deed of trust, security agreement, financing statement and assignment of production executed by any one or more of the Obligors in favour of Administrative Agent, for the benefit of the Secured Parties, in a form satisfactory to the Administrative Agent, in each case as the same may be amended, modified, restated or supplemented from timetotime, together with any assumptions or assignments of the obligations thereunder by any one or more of the Obligors, and “Mortgage” shall mean any one of such Mortgages.

“Multiemployer Plan” means a Plan that is a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

“ Noteholders ” or “ Holders ” means, at a particular time, the Persons entered in the registers hereinafter mentioned as Noteholders outstanding at such time.

“ Note Indebtedness ” means the unpaid principal of and interest on (including interest accruing after the maturity of the Notes and interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to any Borrower or any other Obligor, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) the Notes and all other obligations, indebtedness, or liabilities of the Obligors to the Administrative Agent and the Noteholders, and each of them, whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which may arise under, out of, or in connection with, this Agreement, the Notes, any other Note Purchase Document executed and delivered by any Borrower or any other Obligor, or any other document, instrument or agreement made, delivered or given in connection herewith or therewith, whether on account of principal, interest, reimbursement obligations, guarantee obligations, fees, indemnities, costs, expenses (including all fees, charges and disbursements of counsel to the Administrative Agent or to any Noteholder that are required to be paid by the Borrowers or any other Obligor pursuant to any Note Purchase Document) or otherwise.

“Note Purchase Documents” means, collectively, this Agreement, the Notes, the Fee Letter, the Security Documents, subordination agreements and all other documents to be executed and delivered to theAdministrative Agent and the Noteholders, or any of them, by the Obligors from time to time in connection with this Agreement, and including all amendments, modifications or replacements thereof and all supplements thereto.

“Notes ” means, collectively, the Acquisition Notes, the Existing Notes, the Revolving Notes and the Revenue Participation Notes, in each case issued and delivered hereunder in definitive form.

“ Notice to Redeem ” has the meaning ascribed thereto in Section 4.4 .

“Obligors” means, collectively, each Person that, from time to time, guarantees the Note Indebtedness of the Borrowers.

“OFAC” means the United States Department of the Treasury’s Office of Foreign Assets Control.

“OFAC Regulations” means the regulations promulgated by OFAC, as amended from time to time.

“Organizational Documents” means, (i) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (ii) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (iii) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Entity in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

“ Original Currency ” has the meaning set forth in Section 12.14.

“ Original Note Purchase Agreement ” has the meaning set forth in the Recitals.

“ Other Currency ” has the meaning set forth in Section 12.14.

“Other Taxes” has the meaning specified in Section 2.19 .

“Owned Properties” means, collectively, (i) the land and premises owned by the Company Parties on the date of this Agreement including without limitation, the lands and premises which are listed on Schedule 7.1(l), and (ii) after the date of this Agreement the lands and premises notified to the Administrative Agent pursuant to each Compliance Certificate, but shall exclude lands and premises sold or otherwise disposed of as permitted in this Agreement as and from the date of such sale or disposition.

“ Parent ” has the meaning set forth in the Recitals.

“Parent Pledge Agreement” means the Amended and Restated Pledge Agreement dated as of the date hereof by the Parent to the Administrative Agent for the benefit of the Secured Parties, pledging all Capital Stock held by the Parent in the capital of the Subsidiaries of the Parent, as the same may be amended, modified, extended, renewed, restated, replaced or supplemented from time to time.

“ Participant ” has the meaning set forth in Section 12.9.

“ Parties ” means the Borrowers , the Parent, the Administrative Agent, and the Noteholders from time to time; and “ Party ” means any one of them.

“Permitted Acquisition” means an acquisition by any Company Party of (i) Cilion, Inc., pursuant to the Agreement and Plan of Merger dated July 6, 2012, (ii) the assets constituting a business, division or product line of any Person engaging in a business relating to the Business who is not a Related Party for consideration, including any earnouts, of up to $10 million, which acquisition has been consented to in advance by the Holders or (iii) 100% of the issued and outstanding shares or ownership interests in the capital of such Person for consideration, including any earnouts,which acquisition has been consented to in advance by the Holders.

“Permitted Asset Disposition” means a sale or other disposition:

(f)	that is a bona fide sale at fair market value of inventory in the ordinary course of business for the purpose of carrying on the Business;

(g)	of assets in exchange for other assets comparable or superior as to type, value and quality; or

(h)	of assets (other than securities) which have no material economic value in the Business or business or are obsolete or worn out.

“Permitted Encumbrances” has the meaning specified in the Mortgages .

“Permitted Indebtedness ” means, in respect of any Person, any one or more of the following:

(a)

unsecured Indebtedness that is (i) incurred in the ordinary course of business of the Company Parties (including open accounts extended by suppliers on normal trade terms in connection with purchases of goods and services which are not overdue for a period of more than 90 days or, if overdue for more than 90 days, as to which a dispute exists and adequate reserves in conformity with GAAP have been established on the books of the Company Parties)and (ii) in respect of performance, reclamation, surety or appeal bonds provided in the ordinary course of business or letters of credit issued in lieu of such bonds, but excluding (in each case), Indebtedness incurred through the borrowing of money in respect thereof;

(b)	Indebtedness of the Company Parties to the Secured Partiesunder the Financing Documents;

(c)

Indebtedness incurred by the Company Parties pursuant to Purchase Money Mortgages on terms satisfactory to the Administrative Agent, acting reasonably, up to an aggregate outstanding amount, at any time, of $500,000(or the equivalent amount in another currency) (excluding the Corn Oil Separation System Agreement dated November 16, 2011 between Solution Recovery Services, LLC, a Michigan limited liability company and AEAFK, in effect as of the date hereof);

(d)

Indebtedness incurred by the Borrower or any Company Party pursuant to (i) the Corn Procurement and Working Capital Agreement, dated March 11, 2011 between AEAFK and J.D. Heiskell & Co.; (ii) the Heiskell Purchasing Agreement, dated March 11, 2011 by and between AEAFK and J.D. Heiskell & Co.; and (iii) the Security Agreement dated March 9, 2011 by and between AEAFK and J.D. Heiskell Holdings, LLC, in each case, as such agreements are in effect on the date hereof;

(e)

Intercompany Indebtedness provided such Intercompany Indebtedness (x) is postponed and subordinated to the Note Indebtedness on such terms and pursuant to a promissory note or credit agreement in form and substance satisfactory to the Administrative Agent and (y) is evidenced by a promissory note or loan agreement containing postponement and subordination provisions in form and substance satisfactory to the Administrative Agent; and

(f)	the Subordinated Debt set forth on Schedule 1.1(a).

“ Permitted Investors ” means Third Eye Capital Corporation, its Affiliates, any Noteholder, the Chairman and his Affiliates, including, McAfee Capital, LLC.

“Permitted Liens” means, in respect of any Person, any one or more of the following:

(a)

Liens for taxes, rates, assessments or governmental charges or levies which are not due or delinquent or the validity of which is being contested at the time by the Person in good faith by proper legal proceedings if adequate reserves with respect thereto are maintained on the books of the applicable Company Party in conformity with GAAP;

(b)

Inchoate or statutory Liens of contractors, subcontractors, mechanics, workers, suppliers, materialmen, warehousemen’s carriers and others in respect of construction, maintenance, repair or operation of assets of the Person, provided that (i) such Liens are related to obligations not due or delinquent and are not registered, recorded or filed against any assets of the Person or (ii) such Liens are being contested in good faith by appropriate proceedings, so long as (x) the Administrative Agent determines that such contest does not involve any risk of the sale, forfeiture or loss of any of the Collateral, (y) enforcement of the contested item shall be effectively stayed and (z) a bond or other security instrument has been posted or other adequate provision for payment thereof has been provided in such manner and amount as to assure the Administrative Agent in its discretion that any amounts determined to be due will be promptly paid in full when such contest is resolved; provided, further, that such Liens do not, in the opinion of the Administrative Agent, materially reduce the value of the assets of the Person or materially interfere with the use of such assets in the operation of the business of the Person;

(c)

Easements, rights-of-way, servitudes, restrictions and similar rights in real property comprised in the assets of the Person or interests therein granted or reserved to other Persons, provided that such rights do not, in the opinion of the Administrative Agent, materially reduce the value of the assets of the Person or materially interfere with the use of such assets in the operation of the business of the Person;

(d)

Liens securing appeal bonds and other similar Liens arising in the ordinary course of business in connection with court proceedings (including, without limitation, surety bonds, security for costs of litigation where required by law and letters of credit) or any other instruments serving a similar purpose;

(e)	Liens arising out of a judgment or award that (i) does not constitute an Event of Default underSection 8.1(p)and (ii) is the subject to a good faith contest by the relevant Company Party by proper legal proceedings;

(f)	Liens in favour of the Administrative Agent and the other Secured Partiescreated by the Security Documents or otherwise to secure the obligations of the Obligors pursuant to the Financing Documents;

(g)

Liens existing on the date hereof and disclosed on Schedule 1.1(b) to the extent such Liens conforms to their description on Schedule 1.1(b) and including any extension, renewal or refinancing thereof provided the amount so secured does not exceed the original amount secured immediately prior to such extension, renewal or refinancing and scope of the security creating the Lien is not extended;

(h)

Liens arising out of or in connection with (i) the Corn Procurement and Working Capital Agreement, dated March 11, 2011 between AEAFK and J.D. Heiskell & Co.; (ii) the Heiskell Purchasing Agreement, dated March 11, 2011 by and between AEAFK and J.D. Heiskell & Co.; (iii) the Security Agreement dated March 9, 2011 by and between AEAFK and J.D. Heiskell Holdings, LLC., (iv) the WDG Purchase and Sale Agreement dated March 23, 2011 between A.L. Gilbert Company, a California corporation, and AEAFK, (v) the Corn Oil Separation System Agreement dated November 16, 2011 between Solution Recovery Services, LLC, a Michigan limited liability company, and AEAFK, and (vi) the Revolving Line of Credit Agreement between Aemetis International, Inc. and Laird Q. Cagan; in each case, to the extent such Liens secure Indebtedness described in such agreements on the date of this Agreement;

(g)	Permitted Encumbrances; and

(h)	Purchase Money Mortgages securing obligations up to an aggregate outstanding amount, at any time, of $500,000 (or the equivalent amount in another currency).

“ Person ” means any individual, partnership, limited partnership, joint venture, syndicate, sole proprietorship, limited liability company, company or corporation with or without share capital, body corporate, association, bank, joint-stock company, unincorporated association or organization, trust, trustee, executor, administrator or other legal personal representative, government or governmental authority or entity or an agency or political subdivision thereof, however designated or constituted.

“Plan” means, at a particular time, any employee benefit plan (within the meaning of Section 3(3) of ERISA) that is covered by ERISA and in respect of which any Company Party or a Commonly Controlled Entity is (or, if such plan were terminated at such time, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“ Pledge Agreements ”means, collectively, the Chairman’s Pledge Agreement, the Parent Pledge Agreement and the Subsidiary Pledge Agreements.

“Prime Rate” means a variable rate of interest per annum equal, on any day, to the rate of interest published on such day in the Money Rates section of The Wall Street Journal , a Dow Jones & Company publication, as the U.S. “ prime rate ”, or if The Wall Street Journal or such rate is not published on such day, such rate as last published in the Money Rates Section of The Wall Street Journal . If the Money Rates section of The Wall Street Journal is no longer published or does not publish a rate designated by it as the U.S. “ prime rate, ” then the “ Prime Rate ” shall be determined by reference to such other comparable publicly available service for publishing the “prime rate” as may be selected by the Administrative Agent or, in the absence of such availability, by reference to a comparable interest rate selected by the Administrative Agent in its sole discretion.

“ Program ” means a project financing through or by means of the United States Citizenship and Immigration Service EB-5 Program entered into by AEAFK or any of its Affiliates, and all products and proceeds thereof.

“Properties” means collectively, the Keyes Plant, the other Leased Properties and the Owned Properties.

“ Purchase ” means a Purchase of Notes made by a Person pursuant to Article 2 .

“Purchase Money Mortgage” means any security interest in property acquired by anyCompany Party, including a lease, a leasing agreement or an instalment sale, which is granted or assumed by theCompany Party or which arises by operation of law in favour of the transferor or a Person providing financing concurrently with and for the purpose of the acquisition of such property, in each case where such security interest extends only to the property acquired and its proceeds.

“ Redemption Date” has the meaning attributed to such term in Section 4.4 .

“Redemption Event” means any of the following events: (i) the completion of any equity offering of Capital Stock of any Company Party that results in gross proceeds of at least $2,000,000, (ii) the consummation of a project financing by a Company Party through or by means of the Program of $30,000,000 or more (subject to project or Program restrictions, (iii) if any Company Party receives proceeds from any government grants and credits, including the California Energy Commission granted provided under the California Producer Incentive Program, (iv) if any Company Party receives any proceeds from the Program, and (v) if any Company Party receives any insurance proceeds of any kind; provided , that so long as no Default or Event of Default has occurred and is continuing and the amount of loss does not exceed $250,000, this clause (v) shall not be a Redemption Event to the extent such Company Party reinvests all such insurance proceeds in productive assets of a kind then used in the Business within 180 days after the event of loss with respect to such insurance proceeds.

“ Register ” has the meaning attributed to such term in Section 3.1 .

“ Registered and Records Office ” means the principal executive office of each Borrower, or such other address as such Person may advise the Noteholders in writing from time to time.

“ Regulation S ” means Regulation S adopted by the United States Securities and Exchange Commission under the U.S. Securities Act.

“Related Parties” means, with respect to any Person, such Person’sAffiliates and the directors, officers, employees, agents and advisors of such Person and of such Person’s Affiliates.

“ Required Holders ” means the holders of at least sixty-six and two-thirds percent (66 2/3%) of the outstanding aggregate principal amount of the Notes.

“ Revenue ParticipationNotes ” means, collectively, the notes dated as of the date of this Agreement in the form attached hereto as Exhibit C-3 in the aggregate original principal amount of $10,000,000 issued by the Borrowers made payable to the Noteholders.

“ Revenue ParticipationNotes Interest Rate ” means 5% per annum.

“Revenue Participation Notes Stated Maturity Date” means the second anniversary of the date of this Agreement .

“Revolving Loan Request” has the meaning set forth in Section 2.4.

“ RevolvingNotes ” means, collectively, the revolving notes to be issued by the Borrowers made payable to the Noteholders at the First Closing and any Subsequent Closing in the form attached hereto as Exhibit C-4 up to a maximum aggregate original principal amount of $18,000,000.

“ Revolving NotesInterest Rate ” means (a) the Prime Rate plus 9.75% per annum if the aggregate outstanding principal balance of the Revolving Notes is less than $5,000,000, (b) the Prime Rate plus 11.75% per annum if the aggregate outstanding principal balance of the Revolving Notes is equal to or greater than $5,000,000 but less than $10,000,000 and (c) the Prime Rate plus 13.75% per annum if the aggregate outstanding principal balance of the Revolving Notes is equal to or greater than $10,000,000.

“ Revolving Notes Stated Maturity Date ” means the first anniversary of the date of this Agreement, provided , that the Revolving Notes Stated Maturity Date shall be extended for up to two additional periods of one year upon written notice to the Administrative Agent not less than 30 days prior to end thereof so long as, at the time of such extension, (a) no Event of Default has occurred and is continuing under any Financing Document and (b) the Borrowers pay the Administrative Agent a Revolving Notes Stated Maturity Date Extension Fee for each additional one year period.

“ RevolvingNotes Stated Maturity Date Extension Fee ” has the meaning given to such term in the Fee Letter.

“ Schedule ” means the disclosure schedule delivered by the Parent and Borrowers to the Administrative Agent pursuant to the terms of this Agreement.

“ Secured Parties ” means the collective reference to the Administrative Agent, the Noteholders,and each co-agent or sub-agent appointed by the Administrative Agent from time to time pursuant to any Note Purchase Documents.

“Security” means, at any time, the charges, mortgages, pledges, assignments, liens, security interests and other encumbrances in favour of the Administrative Agent or the other Secured Parties, in the Collateral under this Agreement and the other Note Purchase Documents.

“ Security Agreement ” means, collectively, the Amended and Restated Security Agreement dated as of the date hereof by and among the Parent, the Borrowers and each of other Company Party, together with any other security agreement executed by a Person in favour of the Administrative Agent to secure the Note Indebtedness.

“ Security Documents ” means , collectively, the Security Agreements, the Pledge Agreements, the Guarantees, the Mortgages, the Blocked Account Agreements, patent security agreements, trademark security agreements, copyright security agreements, all guarantees and other security granted to the Administrative Agent and the other Secured Parties, or any of them, as security for the Note Indebtedness, and including all amendments, modifications or replacements thereof and supplements thereto.

“ Senior Officer ” means, (i) with respect to the Parent, the Chairman, the chief executive officer, the president , or the chief financial officer and, (ii) with respect to any other Person, the chief executive officer, the president , or the chief financial officer of such Person .

“ Solvent ” means, with respect to any Person as of any date of determination, that on such date (a) the amount of the “present fair saleable value” of the assets of such Person will, as of such date, exceed the amount of all “liabilities of such Person, contingent or otherwise”, as of such date, as such quoted terms are determined in accordance with applicable federal and state laws governing determinations of the insolvency of debtors, (b) the present fair saleable value of the assets of such Person will, as of such date, be greater than the amount that will be required to pay the liabilities of such Person on its debts as such debts become absolute and matured (c) such Person will not have, as of such date, an unreasonably small amount of capital with which to conduct its business, and (d) such Person will be able to pay its debts as they mature. For purposes of this definition, (i) “debt” means liability on a “claim”, and (ii) “claim” means any (x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

“ Subordinated Debt ” means any Indebtedness of the Parent or any Company Party in an aggregate principal amount of not more than $2,000,000 that is unsecured and subordinated by written agreement in right of payment, liens, security and remedies to the Note Indebtedness in form and substance acceptable to the Administrative Agent.

“ Subsequent Closings ” means, at the option of the Borrowers, one or more Closings for the purchase and sale ofRevolving Notesfollowing the First Closing, in each case as contemplated herein, provided that no more than $18,000,000 principal amount of Revolving Notes shall be issued and outstanding at any time .

“ Subsidiary ” of a Person means a corporation, partnership, limited liability company or other business entity of which a majority of the Capital Stock or other interests having ordinary voting power for the election of directors or other governing body (other than Capital Stock having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly or indirectly , through one or more intermediaries, or both, by such Person. Unless otherwise qualified, all references to a “ Subsidiary ” or to “ Subsidiaries ” in this Agreement shall refer to a Subsidiary or Subsidiaries of the Parent .

“Subsidiary Pledge Agreements” means, collectively, (a) the Amended and Restated Pledge Agreement dated as of the date hereof by Aemetis International, Inc. to the Administrative Agent for the benefit of the Secured Parties, pledging all Capital Stock held by such Person in the capital of International Biofuels Ltd. and any other Subsidiaries, (b) the Amended and Restated Pledge Agreement dated as of the date hereof by Aemetis Biofuels, Inc. to the Administrative Agent for the benefit of the Secured Parties, pledging all Capital Stock held by such Person in the capital of Energy Enzymes, Inc. and any other Subsidiaries, (c) the Pledge Agreement dated as of the date hereof by AE Advanced Fuels, Inc. to the Administrative Agent for the benefit of the Secured Parties, pledging all Capital Stock held by such Person in the capital of Keyes Facility Acquisition Corp. and any other Subsidiaries and (d) the Pledge Agreement dated as of the date hereof by Aemetis Americas, Inc. to the Administrative Agent for the benefit of the Secured Parties, pledging all Capital Stock held by such Person in the capital of AE Biofuels, Inc. and any other Subsidiaries, in each case, as the same may be amended, modified, extended, renewed, restated, replaced or supplemented from time to time.

“Taxes” has the meaning specified in Section 2.19 .

“ Transfer ” has the meaning set forth in Section 3.1.

“ UCC ” or “Uniform Commercial Code” means the Uniform Commercial Code as in effect from time to time in the State of Delaware; provided, however, in the event that, by reason of mandatory provisions of law, any or all of the perfection or priority of the security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of Delaware, the term “UCC” shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of provisions relating to such perfection or priority and for purposes of definitions related to such provisions.

“ United States ” means the United States of America, its territories and possessions, any State of the United States, and the District of Columbia.

“ U.S. Person ” means a “ U.S. Person ” as that term is defined in Rule 902(k) of Regulation 5.

“ U.S.Securities Act ” means the United States Securities Act of 1933, as amended.

“ Voting Shares ” means shares of Capital Stock of any class of any Person carrying voting rights under all circumstances, provided that for the purposes of such definition, shares which only carry the right to vote conditionally on the happening of any event shall not be considered Voting Shares, whether or not such event shall have occurred, nor shall any shares be deemed to cease to be Voting Shares solely by reason of a right to vote accruing to shares of another class or classes by reason of the happening of such event.

Section 1.2 Meaning of “outstanding” for certain purposes

(1)	Every Note executed and delivered by the Borrowers hereunder shall be deemed to be outstanding until it shall be cancelled or delivered to the Borrowers for cancellation, or a new Note shall be issued in substitution therefore, provided that:

(a)	where a new Note has been issued in substitution for a Note which has been mutilated, lost, stolen or destroyed, only the new Note shall be counted for the purpose of determining the aggregate principal amount of Notes outstanding;

(b)	Notes which have been partially redeemed or purchased shall be deemed to be outstanding only to the extent of the unredeemed or unpurchased part of the principal amount thereof; and

(c)

for the purpose of any provision of this Agreement entitling Holders to vote, sign consents, requests or other instruments or take other action under this Agreement, Notes owned, directly or indirectly, legally or equitably by Borrowers or any Affiliate or Subsidiary of the Borrowers shall be disregarded, except that:

(i)

Notes so owned which have been pledged in good faith other than to the Borrowers or an Affiliate or Subsidiary of any Borrower shall not be so disregarded if the pledgee shall establish, to the satisfaction of the such Borrower, the pledgee's right to vote such Notes, sign consents, requisitions or other instruments or take such other actions in its discretion free from the control of any Borrower or any Affiliate or Subsidiary of such Borrower; and

(ii)	Notes so owned shall not be disregarded if they are the only Notes outstanding.

Section 1.3 Certain Phrases, etc.

In this Agreement (i) (y) the words “including” and “includes” mean “including (or includes) without limitation” and (z) the phrase “the aggregate of” , “the total of” , “the sum of” , or a phrase of similar meaning means “the aggregate (or total or sum), without duplication, of” , (ii) in the computation of periods of time from a specified date to a later specified date, unless otherwise expressly stated, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding” , and references to “this Agreement” , “hereof” and “herein” and like references refer to this Agreement and not to any particular Article, Section or other subdivision of this Agreement and the expressions “Article” , “Section” , “subsection” and “paragraph” followed by a number mean and refer to the specified Article, Section, subsection paragraph of this Agreement.

Section 1.4 Interpretation Not Affected by Headings

The division of this Agreement into articles, sections, subsection and paragraphs, the provision of a table of contents and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation of this Agreement.

Section 1.5 Statute References

Any reference in this Agreement to a statute shall be deemed to be a reference to such statute as amended, re-enacted or replaced from time to time.

Section 1.6 Currency

Any reference in this Agreement to “ Dollars ”, “ dollars ” or “$” shall be deemed to be a reference to lawful money of the United States and any reference to any payments to be made by the Borrowers shall be deemed to be a reference to payments made in lawful money of the United States. Should any payment be made to the Administrative Agent in a currency other than United States dollars, the Administrative Agent shall not be obligated to apply any particular exchange rate to such currency and may convert such funds at the Administrative Agent's sole discretion, acting reasonably.

Section 1.7 Non-Business Day

Whenever any payment to be made hereunder shall be due, any period of time would begin or end, any calculation is to be made or any other action is to be taken on or as of, a day other than a Business Day, such payment shall be made, such period of time shall begin or end, such calculation shall be made and such other actions shall be taken, as the case may be, unless otherwise specifically provided for herein, on or as of the next succeeding Business Day and the holder of any Note shall not be entitled to any further interest or other payment in respect of such delay.

Section 1.8 Invalidity of Provisions

Each of the provisions contained in this Agreement or the Notes is distinct and severable and a declaration of invalidity, illegality or unenforceability of any such provision by a court of competent jurisdiction shall not affect the validity, legality or enforceability of any other provision hereof or thereof.

Section 1.9 Governing Law

(1)

This Agreement and the other Note Purchase Documents and any claims, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Agreement or any other Note Purchase Document (except, as to any other Note Purchase Document, as expressly set forth therein) and the transactions contemplated hereby and therebyshall be governed by, construed and enforced in accordance with the laws of the State of Delaware.

(2)

Each Borrower and the Parent irrevocably and unconditionally agrees that it will not commence any action, litigation or proceeding of any kind or description, whether in law or equity, whether in contract or in tort or otherwise, against the Administrative Agent, any Holder or any Related Party of the foregoing in any way relating to this Agreement or any other Note Purchase Document or the transactions relating hereto or thereto, in any forum other than the courts of the State of Delaware sitting in the State of Delaware, and of the United States District Court sitting in the State of Delaware, and any appellate court from any thereof, and each of the parties hereto irrevocably and unconditionally submits to the jurisdiction of such courts and agrees that all claims in respect of any such action, litigation or proceeding may be heard and determined in such Delaware State court or, to the fullest extent permitted by applicable law, in such federal court. Each of the parties hereto agrees that a final judgment in any such action, litigation or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or in any other Note Purchase Document shall affect any right that the Administrative Agent or any Holder may otherwise have to bring any action or proceeding relating to this Agreement or any other Note Purchase Document against the Borrowers, the Parent or any other Company Party or any of their respective properties in the courts of any jurisdiction.

(3)	All negotiations and agreements pertaining to the Financing shall be deemed to have been conducted and concluded in the Province of Ontario.

Section 1.10 Service

Each of the Parent and the Borrowers irrevocably consents to service of process in the manner provided for notices in Article 11. Nothing in thisSection 1.10 shall affect the right of the Administrative Agent or any other Secured Party to serve legal process in any other manner permitted by applicable law or affect the right of the Administrative Agent or any other Secured Party to bring any suit, action or proceeding against any Obligor or its property in the courts of other jurisdictions.

Section 1.11 Paramountcy

In the event of any inconsistency between the provisions of any section of this Agreement and the provisions of any Note Purchase Document or any Schedule which forms a part hereof, the provisions of this Agreement shall prevail.

Section 1.12 Number and Gender

In this Agreement, unless the context otherwise requires, words importing the singular include the plural and vice versa and words importing gender include all genders.

Section 1.13 Time of the Essence

Time shall be of the essence in all respects in this Agreement.

Section 1.14 Accounting Terms

All accounting terms not specifically defined in this Agreement shall be interpreted in accordance with GAAP except that, for the purposes of calculating the financial covenants set forth in Section 6.2, no Subsidiary that is not an Obligor shall be included in such calculations and definitions.

ARTICLE 2

THE NOTES

Section 2.1 Purchase of the Notes

Relying on the representations and warranties set out in this Agreement, and subject to the terms and conditions set out in this Agreement, at each applicable Closing, the Noteholders hereby agree to purchase from the Borrowers, and the Borrowers hereby agree to issue to the Noteholders, the Notes .

Section 2.2 Conditions Precedent to Purchase of Notes

It shall be a condition precedent to the purchase of the Notes, in whole or in part at any time and on each Closing Date, that the Administrative Agent and the Noteholders are satisfied, in their sole discretion, that no Defaults or Events of Default have occurred and are continuing, all of the representations and warranties of the Obligors in the Note Purchase Documents are true and correct, no Material Adverse Effect shall have occurred and be continuing, no event, condition or state of facts shall exist or have occurred that could reasonably be expected to result in a Material Adverse Effect, the purchase and sale of the Notes shall not violate any Applicable Law, and the Administrative Agent and the Noteholders shall have completed or received, as applicable, and shall be satisfied (in form and substance) with, in their sole discretion:

(a)	all credit, collateral, business, financial, management, legal and other due diligence, including the following:

(i)	a final use of proceeds of the Financing (which, once agreed by the Administrative Agent, shall be the Agreed Use of Proceeds) and pro forma consolidated balance sheet of the Parent after giving effect to the Acquisition and Financing;

(ii)

satisfaction of the Administrative Agent that there is no material damage or destruction to any of the Collateral, nor any material depreciation in the value thereof, and that all Collateral is covered by insurance in sufficient form and substance naming the Administrative Agent as first loss payee and additional insured;

(iii)

a final valuation report from Natwick Associates, in form and substance satisfactory to the Administrative Agent;

(iv)	finalization of the definitive legal and tax structure in respect of the Financing in form and substance satisfactory to the Administrative Agent; and

(v)	satisfaction of the Administrative Agent that there are no pending or threatened disputes that seeks to adjourn, delay, enjoin, prohibit or impose material limitations on any aspect of the Financing or that has had, or could have, a Material Adverse Effect;

(b)	the Administrative Agent shall have received, in each case in form and substance satisfactory to it:

(vi)

a certificate of a Senior Officer of each Borrower and each other Obligor attaching copies of its Organizational Documents and any stockholder agreement with respect to such Obligor, a list of its officers and directors with occupations of all directors, specimens of the signatures of those officers or directors who are executing the Note Purchase Documents on its behalf, copies of the corporate proceedings taken to authorize it to execute, delivery, and perform its obligations under the Note Purchase Documents and all related and security documentation, and other corporate and “know-your-client” information that Administrative Agent or the other Noteholders may require;

(vii)

a certificate of status, compliance, good standing or equivalent for each Borrower and each other Obligor for its jurisdiction of incorporation and for each jurisdiction where it carries on business or where registrations or filings in relation to the Collateral have been effected;

(viii)

all required director, shareholder, government and third-party consents, approvals and Authorizations necessary or required in connection with this Agreement, the Notes, the Security Documents and any other Note Purchase Documents;

(ix)

all Note Purchase Documents (including the Blocked Account Agreements) duly executed and delivered by a Borrower, the other Obligors and the other parties thereto and, where applicable, in form suitable for filing or recording in all filing and recording offices that the Administrative Agent may deem necessary or desirable in order to create a valid first priority Lien, subject only to Permitted Liens, on the property described therein in favour of the Administrative Agent, for the benefit of the Secured Parties, and evidence that all filing, stamp, intangible, and recording taxes and fees have been paid;

(x)

UCC, bankruptcy, litigation and other customary transaction searches shall have been received and be deemed satisfactory to the Administrative Agent, and confirmation satisfactory to the Administrative Agent of registration, recordation and filing, as applicable, of all Security Documents in all offices of public record as may be required to properly perfect the mortgages, charges and Liens created thereby, subject only to Permitted Liens;

(xi)

releases, discharges, subordination agreements, waivers, confirmations, consents (including those required under any Material Contracts or from landlords, warehousemen, mechanics, materialmen, mortgagees and licensors) as may be required in the discretion of the Administrative Agent and to ensure that all Note Indebtednessis secured by first priority Liens, subject to Permitted Liens that by law rank in priority, on the Collateral with such exceptions as are permitted pursuant to this Agreement;

(xii)

opinions (including title opinions, as applicable) from legal counsel for the Borrowers and the Parent, addressed to the Administrative Agent with respect to such matters as the Administrative Agent may reasonably request and in form and substance reasonably acceptable to the Administrative Agent;

(xiii)

a certificate from a Senior Officer of the Borrowers and each other Obligor that all representations and warranties of the Borrowers and the other Obligors under the Security Documents and the other Note Purchase Documents to which such Obligor is a party are true and correct and as to such other matters as the Administrative Agent reasonably requires;

(xiv)

certificates of insurance or policy endorsements, as applicable, evidencing that the Administrative Agent has been named as an additional insured and first-loss payee on all property insurance policies of the Company Parties;

(xv)	certificates of insurance or policy endorsements, as applicable, evidencing that each of the Secured Parties has been named as additional insured on all liability insurance policies of the Company Parties;

(xvi)

certificates representing the Capital Stock pledged by the Chairman and the other Obligors together with stock transfer powers duly executed in blank by the pledging Obligor, and each promissory note (if any) pledged to the Administrative Agent pursuant to the Security Documents endorsed (without recourse) in blank (or accompanied by an executed transfer form in blank) by the pledgor thereof;

(xvii)

payment of all fees and expenses contained in the Fee Letter, this Agreement, or any other Note Purchase Document.

(c)

the Acquisition shall be consummated concurrently with the First Closing, and the Administrative Agent shall have received, in form and substance satisfactory to it, certified executed copies of definitive legal documentation in connection with the Acquisition, and other agreements related and integral to the completion of the Acquisition, and all conditions under such documentation shall have been satisfied without amendment or waiver;

(d)	the other transactions contemplated by the Financing Documents shall be consummated concurrently with the First Closing;

(e)	immediately following the Financing, no Company Party shall have any Indebtedness (other than Permitted Indebtedness);

(f)	all costs, fees, expenses (including, without limitation, legal fees and expenses and the fees and expenses of appraisers, consultants and other advisors) and other compensation payable to the Secured Parties shall have been paid to the extent due;

(g)	evidence satisfactory to the Administrative Agent that after giving effect to the transactions contemplated by this Agreement, the Parentis in pro forma compliance, on a consolidated basis, with all financial covenants required by this Agreement;

(h)	the aggregate principal amount of Notes issued pursuant to this Agreement does not exceed $47,184,573.64 on the First Closing;

(i)	evidence of the issuance of 15,000,000 shares of Common Stock to the Holders;

(j)	a Phase I Environmental Site Assessment Report for the Keyes Plant, accompanied by corresponding reliance letters (to the extent such report does not permit reliance thereon by the Administrative Agent and the Noteholders), satisfactory to the Administrative Agent;

(k)	the appointment by the Parent of McGladrey, LLP or one of its Affiliates as auditors;

(l)

a fully-paid ALTA standard form of mortgagee policy of title insurance issued by First American Title Insurance Company, in favour of the Administrative Agent for the benefit of the Secured Parties, together with such endorsements as are requested by the Administrative Agent, in each case in form and substance satisfactory to the Administrative Agent, in an amount of not less than $50,184,573.64, that shall (A) insure the validity and priority of the Liens created under the the Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing dated as of the date hereof by Cilion Acquisition Corp. to First American Title Insurance Company in favour of the Administrative Agent, and (B) contain a pending disbursement provision satisfactory to the Administrative Agent;

(m)	continued subordination of any debt to the Chairman, Laird Cagan, other directors, or their respective Affiliates and relatives; and

(n)	such other documents relating to the transactions contemplated by this Agreement and any other Note Purchase Documents as the Administrative Agent or its counsel or any other Noteholder may reasonably request.

Section 2.3 Creation and Issuance of the Notes

The Borrowers hereby create and authorize the Notes for issuance in the aggregate principal amount of up to $50,184,573.64. The Notes shall be dated as of their applicable Issue Date (including all replacement certificates issued in accordance with this Agreement) and will become due and payable, together with all accrued and unpaid interest thereon, on the Maturity Date. Other than the Revolving Notes, which may be re-issued once redeemed, none of the other Notes may be re-issued once redeemed.

Section 2.4 Subsequent Closings and Revolving Notes

Subject to the terms and conditions set forth in Section 2.2, on and after the date of this Agreement and upon written notice by the Borrowers to the Administrative Agent of not less than ten Business Days in substantially the form attached hereto as Exhibit B (each, a “ Revolving Loan Request ”), the Noteholders, severally, and not jointly, agree to issue Revolving Notes in an aggregate amount not to exceed at any time outstanding the amount identified in the Allocation Notice; provided, however, that after giving effect to any outstanding Revolving Notes, the aggregate principal amount of all outstanding Revolving Notes shall not exceed $18,000,000. The aggregate principal amount of any new Revolving Notes issued at any Subsequent Closing must be at least $500,000 and in increments of $100,000. At each Subsequent Closing, the Borrowers shall deliver an officer’s certificate to the Administrative Agent and such other evidence reasonably acceptable to the Administrative Agent that the conditions precedent set forth in Section 2.2 have been met.

Section 2.5 Description of Notes

The Notes shall mature and become due and payable on the Maturity Date. The Notes shall bear interest from their applicable Issue Date at the Applicable Interest Rate (after, as well as before, default or judgment). On the occurrence of and during the continuation of an Event of Default, the Applicable Interest Rate shall be increased by the Default Rate. Interest on the Notes shall be payable in arrears in monthly instalments on the first Business Day of the month commencing on the first Business Day of the calendar month immediately following the date of this Agreement .

Section 2.6 Place of Payment

Subject to Section 9.2, the principal amount of the Notes and interest thereon due on maturity will be payable in lawful money of the United States against surrender of such Notes by the respective Holders thereof at the Registered and Records Office of the Borrowers, provided that the Borrowers may from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all of such purposes, and may from time to time rescind such designations. The Borrowers will give prompt written notice to the Administrative Agent of any such designation and any change in the location of any such other office .

Section 2.7 Form of Notes

Each Note shall be issued in an initial minimum principal amount of $1 ,0 00,000. The Notes shall be in the English language. The form of Note shall be substantially in the form set out in Exhibit C hereto. The Notes shall bear such distinguishing letters and numbers as the Borrowers may approve. The Notes may be engraved, printed or lithographed, mimeographed or typewritten, or partly in one form and partly in another, as the Borrowers may determine.

Section 2.8 Legend

(1)

The Notes have not been and will not be registered under the U.S. Securities Act or under any United States state securities laws. The Notes may not be offered or sold, directly or indirectly, in the United States or to a U.S. Person, unless the Notes are sold in a transaction that does not require registration under the U.S. Securities Act, and any applicable state laws and regulations governing the offer and sale of securities. Each Note originally issued in the United States, or to, or for the account or benefit of, a U.S. Person, and each Note issued in exchange therefor or in substitution thereof shall bear the following legends or such variations thereof as the Borrowers may prescribe from time to time:

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR UNDER ANY STATE SECURITIES LAWS . THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE COMPANY THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY, (B) OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE 1933 ACT, (C) IN ACCORDANCE WITH (I) RULE 144A, IF AVAILABLE, OR (II) RULE 144, IF AVAILABLE, AND IN EACH CASE IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, OR (D) UNDER AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS;

provided that, if the Notes are being sold outside the United States in accordance with Rule 904 of Regulation S under the U.S. Securities Act, and provided that each Borrower is a “foreign issuer” within the meaning of Rule 902 of Regulation S at the time of such sale, the legend may be removed by providing a customary form of declaration to each Borrower (or such other evidence of exemption, including an opinion of counsel, as each Borrower may reasonably prescribe from time to time), provided further, if the Notes are being sold under Rule 144 under the U.S. Securities Act and in compliance with applicable state securities laws, the legend may be removed by delivery to each Borrower of an opinion of counsel reasonably satisfactory to each Borrower to the effect that such legend is no longer required under applicable requirements of the U.S. Securities Act or state securities laws.

(2)	Upon receipt of such evidence of exemption (reasonably acceptable to Borrower) as referred to in this Section 2.8(2), each Borrower shall use its reasonable best efforts to remove such legend within five Business Days of receipt of such declaration.

(3)	Notwithstanding any other provisions of this Agreement, each Borrower and/or its transfer agent may impose additional reasonable requirements for the removal of legends from Notes in compliance with Rule 904 of Regulation S under the U.S. Securities Act.

(4)

Notwithstanding any other provisions of this Agreement, in processing and registering transfers of Notes, no duty or responsibility whatsoever shall rest upon any Borrower to determine the compliance by any transferor or transferee with the terms of the legend above, or with the relevant securities laws or regulations, including, without limitation, Regulation S of the U.S. Securities Act, and such Borrower shall be entitled to assume that all transfers are legal and proper insofar as they relate to such aforementioned legend, laws and regulations.

Section 2.9 Execution of Notes

All Notes shall be signed (either manually or by facsimile signature) by any Senior Officer of each Borrower. A signature upon any of the Notes shall for all purposes of this Agreement be deemed to be the signature of the individual whose signature it purports to be and to have been signed at the time such signature (either manual or in facsimile) may appear on the Notes and notwithstanding that any individual whose signature (either manual or in facsimile) may appear on the Note is not, at the date of Agreement or at the date of the Notes or at the date of the certifying and delivery thereof, any Senior Officer, as the case may be, of such Borrower, such Notes shall be valid and binding upon the Borrowers and the Holders shall be entitled to the benefits of this Agreement.

Section 2.10 Certification

No Note shall be issued or, if issued, shall be obligatory or shall entitle the Holder to the benefits of this Agreement, until it has been executed by manual or facsimile signature by or on behalf of the Borrowers substantially in the form of the Note set out in Exhibit C hereto, or in some other form approved by the Borrowers as permitted hereby. Such execution of the Note shall be conclusive evidence that such Note is duly issued and is a valid and binding obligation of the Borrowers and that the Holder is entitled to the benefits of this Agreement.

Section 2.11 Interest and Payments

(1)

Every Note, whether issued originally or in exchange for other previously issued Notes, shall bear interest from and including the later of (i) the Issue Date; and (ii) the last Interest Payment Date with respect to which interest shall have been paid or made available for payment on theNotes, to, but not including, the subsequent Interest Payment Date. Interest shall be paid monthly in arrears on the first Business Day of each month for interest accrued in the previous month.

(2)

Interest shall be computed on the basis of a year of 365 days for payments. For the purposes of this Agreement, whenever interest is computed on the basis of a year (a “ Deemed Year ”) which contains fewer days than the actual number of days in the calendar year of calculation, such rate of interest shall be expressed as a yearly rate by multiplying such rate of interest by the actual number of days in the calendar year of calculation and dividing such product by the number of days of the Deemed Year.

(3)

Wherever in this Agreement or the Notes there is mention, in any context, of the payment of interest, such mention shall be deemed to include the payment of interest on amounts in default to the extent that in such context such interest is, was or would be payable pursuant to this Agreement or such Notes and express mention of interest on amounts in default in any of the provisions hereof shall not be construed as excluding such interest in those provisions hereof where such express mention is not made.

(4)	All payments of principal or interest under the Notes shall be made to the Administrative Agent for the benefit of the Noteholders by wire or other electronic transfer of immediately available funds.

Section 2.12 Replacement of Notes

If any of the Notes issued and certified hereunder shall become mutilated or be lost, stolen or destroyed, the Borrowers shall issue and deliver, a replacement Note of like date and tenor as the one mutilated, lost, stolen or destroyed in exchange for and in place of and upon surrender and cancellation of such mutilated Note, or, in the case of a lost, stolen or destroyed Note, in lieu of and in substitution for the same, and the substituted Note shall be in a form of the Note attached as Exhibit C hereto, and shall be entitled to the benefits of this Agreement and shall, in accordance with Section 2.16, rank equally with all other Notes issued or to be issued hereunder. In case of loss, theft or destruction, the applicant for a substituted Note shall furnish to the Borrowers such evidence of such loss, theft or destruction as shall be satisfactory to each of them in their own discretion, acting reasonably. The Borrowers shall pay all expenses incidental to the issuance of any such new Note and a customary indemnity from the applicant, in a form acceptable to the applicant, in favour of the Borrowers in respect of the lost, stolen or destroyed Note shall be provide by the applicant.

Section 2.13 Option of Holder as to Place of Payment

Except as provided otherwise herein, all amounts which at any time become payable on account of any Note or any interest thereon shall be payable at the option of the Holder at any of the places at which the principal and interest in respect of such Note are payable pursuant to Section 2.6.

Section 2.14 Record of Payments

Each Borrower shall maintain accounts and records evidencing each payment of principal of and interest on the Notes. The Borrowers shall be responsible for all aspects of the records related to or payments made on account of beneficial interests in any Note and for maintaining, reviewing, or supervising any records relating to such beneficial interests.

Section 2.15 Surrender for Cancellation

If the principal amount due upon any Note shall become payable before the Applicable Stated Maturity Date thereof, the Person presenting such Note for payment shall surrender the same for cancellation to the Registered and Records Office of the Borrowers and the Borrowers shall pay or cause to be paid the interest accrued and unpaid thereon in cash together with all other obligations owing to the Administrative Agent or any Noteholder under or in connection with this Agreement and the Notes in immediately available funds (computed on a per diem basis if the date fixed for payment is not an Interest Payment Date).

Section 2.16 Notes to Rank Pari Passu

The Notes shall rank pari passu (equally and rateably) with each other and shall be secured obligations of the Borrowers, and the Liens granted for the benefit of the Secured Parties pursuant to the Security Documents shall constitute security ranking in first priority over all other Liens on the Collateral, except any applicable Permitted Liens which by law rank in priority.

Section 2.17 No Setoff

All payments hereunder and under the Notes shall be made by the Borrowers without setoff, offset, deduction or counterclaim, free and clear of all taxes (excluding, in the case of the Holders, taxes imposed on such Holders’ net income), levies, imports, duties, fees and charges, and without any withholding, restriction or conditions imposed by any Governmental Entity. If a Borrower is required by Applicable Laws or by the interpretation or administration thereof to deduct, setoff, or withhold any amount from or in respect of any payment to the Administrative Agent or Noteholders hereunder or under the Notes or any other Note Purchase Documents, then the amount so payable shall be increased so that, after making all required deductions, setoffs and withholdings, the Administrative Agent or Noteholders shall receive an amount equal to the sum which would have been received had no such deductions, setoffs or withholding been made.

Section 2.18 Use of Proceeds

The Borrowers shall use the net proceeds from the issuance of the Notes to fund (i) the Acquisition, (ii) the repayment of outstanding indebtedness to the holders of the Notes issued pursuant to the Note and Warrant Purchase Agreement dated as of May 16, 2008 by and among the Parent, the Administrative Agent and the other parties thereto, (iii) general working capital purposes and general corporate purposes, in each case, of the Borrowers and the Parent, (iv) the repayment of certain outstanding obligations owed to David Lies, Laird Cagan and Third Eye Capital Corporation pursuant to short-term advances provided to the Borrowers in May 2012 and June 2012 and (v) certain expenses associated with the Financing and approved by the Administrative Agent, in each case, in accordance with the Agreed Use of Proceeds, and for no other purpose whatsoever without the prior written consent of the Administrative Agent.

Section 2.19 Taxes and Other Taxes

(1)

All payments to the Administrative Agent and the Holders by the Borrowers and the Parent under any of the Note Purchase Documents shall be made free and clear of and without deduction or withholding for any and all taxes, levies, imposts, deductions, charges or withholdings and all related liabilities, excluding income taxes imposed on the net income of a Holder and franchise taxes imposed on the net income of a Holder, in each case by the jurisdiction under the laws of which such Holder is organized or qualified to do business or a jurisdiction or any political subdivision thereof in which the Holder engages in business activity other than activity arising solely from the Holder having executed this Agreement and having enjoyed its rights and performed its obligations under this Agreement or any Note Purchase Document or any political subdivision thereof (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being referred to as “Taxes” ) imposed by the United States of America or any other relevant jurisdiction (or any political subdivision or taxing authority of it), unless such Taxes are required by applicable law to be deducted or withheld. If any Borrower or the Parent shall be required by applicable law to deduct or withhold any such Taxes from or in respect of any amount payable under any of the Note Purchase Documents (i) the amount payable shall be increased (and for greater certainty, in the case of interest, the amount of interest shall be increased) as may be necessary so that after making all required deductions or withholdings (including deductions or withholdings applicable to any additional amounts paid under this Section 2.18, the Administrative Agent and the Holders receive an amount equal to the amount they would have received if no such deduction or withholding had been made, (ii) the Borrowers and/or the Parent, as applicable, shall make such deductions or withholdings, and (iii) the Borrowers and/or the Parent shall pay when required the full amount deducted or withheld to the relevant Governmental Entity in accordance with applicable law.

(2)

Each of Borrowers and the Parent agrees to immediately pay any present or future stamp or documentary taxes or any other excise or property taxes, charges, financial institutions duties, debits taxes or similar levies (all such taxes, charges, duties and levies being referred to as “Other Taxes” ) which arise from any payment made by the Borrowers and/or the Parent, as applicable, under any of the Note Purchase Documents or from the execution, delivery, recordation, or registration of, or otherwise with respect to, any of the Note Purchase Documents.

(3)

The Borrowers and the Parent shall jointly and severally indemnify the Holders and the Administrative Agent for the full amount of Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable under this Section 2.18) payable or paid by the Holders or the Administrative Agent and any liability (including penalties, interest and expenses) arising from or with respect to such Taxes or Other Taxes, whether or not they were correctly or legally asserted. Payment under this indemnification shall be made within 30 days from the date the Administrative Agent or the relevant Holder, as the case may be, makes written demand for it. A certificate as to the amount of such Taxes or Other Taxes submitted to the Borrowers by the Administrative Agent or the relevant Holder shall be conclusive evidence, absent manifest error, of the amount due from the Borrowers and/or the Parent to the Administrative Agent or the Holders, as the case may be.

(4)	Upon the Administrative Agent’s request, each Borrower shall furnish to the Administrative Agent the original or a certified copy of a receipt evidencing payment of Taxes or Other Taxes made by the Borrowers or the Parent within 30 days after the date of any payment of Taxes or Other Taxes.

(5)	The provisions of this 2.18 shall survive the termination of the Agreement and the repayment of all Note Indebtedness.

ARTICLE 3

REGISTRATION, TRANSFER, EXCHANGE AND OWNERSHIP OF NOTES

Section 3.1 Registration

Each Borrower shall, at all times while any Notes are outstanding, cause to be kept at the Registered and Records Office of such Borrower, a central register (the “ Register ”) in which shall be entered the names and latest known addresses of the Noteholders and the other particulars, as prescribed by law, of the Notes held by them respectively and of all assignments or transfers of Notes (a “ transfer ”). Such registration shall be noted on the Notes when issued by such Borrower. The Register shall, upon prior written notice, at all reasonable times during business hours on a Business Day be open for inspection by any Noteholder.

Section 3.2 Transfer of Notes

(1)	A Noteholder may at any time and from time to time have a Note or any portion thereof transferred at the Registered and Records Office of each Borrower.

(2)	No transfer of a Note or any portion thereof shall be effective as against a Borrower unless:

(a)	such transfer is made by the Holder or the executor, administrator or other legal representative of, or any attorney of, the Holder, duly appointed by an instrument received bysuch Borrower, acting reasonably;

(b)	the form of transfer, in the form attached to the Note,together with the Note has been received by such Borrower; and

(c)	such transfer is made in compliance with all Applicable Laws.

Any transfer of a Note or any portion thereof shall require the prior written consent of the Administrative Agent. For greater certainty, no consent of the Borrowers shall be required in connection with any transfer of a Note or any portion thereof otherwise in compliance with this Agreement.

(3)

To the extent any portion of a Note (but not the entire principal amount of a Note) is transferred pursuant hereto, upon presentation of such Note, the Borrowers shall execute Notes representing the transferred portion and the balance not so transferred and the original Note shall thereupon be cancelled. Notwithstanding any failure by the Borrowers to so execute such Notes, the transferee shall have all rights of a Noteholder with respect to the portion of any Note transferred to it in compliance with this Agreement and the transferor shall retain all rights of a Noteholder with respect to the balance of the Note not so transferred.

(4)

Upon becoming a Noteholder in accordance with the provisions of this Agreement, the transferee thereof shall be deemed to have acknowledged and agreed to be bound by this Agreement. Upon registration of such transferee as the holder of a Note, the transferor shall cease to have any further rights under this Agreement with respect to such Note to the extent so transferred.

Section 3.3 Transferee Entitled to Registration

The registered transferee of a Note shall be entitled, after a form of transfer, in a form reasonably acceptable to the Borrowers, is lodged with the Borrowers and upon compliance with all other conditions in that regard required by this Agreement or by law, to be entered on the Register as the Holder of the Note free from all equities or rights of setoff or counterclaim between the Borrowers and the transferor or any previous Holder, except in respect of equities of which the Borrowers are required to take notice by statute or by order of a court of competent jurisdiction.

Section 3.4 Exchange of Notes

Notes of any denomination may be exchanged for Notes of any other denomination or denominations, any such exchange to be for Notes of an equivalent aggregate principal amount, at the expense of the Borrowers. Exchanges of Notes may be made at the Registered and Record Offices of the Borrowers. Any Notes tendered for exchange shall be cancelled. The Borrowers shall execute all Notes necessary to carry out such exchanges.

Section 3.5 Ownership of Notes and Entitlement to Payment

(1)

The Holder of a Note shall be entitled to the principal and interest evidenced by such Note, less any amounts paid to the original or any previous Holder of the Note, but free from all other equities or rights of set-off or counterclaim between the Borrowers and the original or any intermediate Holder thereof (except any equities of which the Borrowers are required to take notice by law or by order of a court of competent jurisdiction). The receipt by any such Holder of any principal or interest shall be a good and sufficient discharge to the Borrowers for the amount so paid, and the Borrowers shall not be bound to inquire into the title of any such Holders.

(2)	The Borrowers may treat the Holder of a Note as the beneficial owner thereof without actual production of such Note for the purposes of any direction, consent, instrument or other document to be made, signed or given by the Holder of such Note.

Section 3.6 Restriction on Transfer of Notes under U.S. Securities Laws

(1)	Notwithstanding anything contained in this Agreement, or the certificate evidencing the Notes, each Borrower:

(a)

shall only be obligated to register a transfer of a Note (or any portion thereof) imprinted with the legends specified in Section 2.8 if such Borrower has received, in addition to a properly completed and executed transfer form in the form included in such certificate, either (A) a properly completed and executed customary form of declaration (or as otherwise reasonably prescribed by such Borrower), or (B) a written opinion of counsel or other evidence satisfactory to such Borrower, acting reasonably, to the effect that the transfer of such Note is in compliance with applicable United States federal and state securities laws; and

(b)	shall not be obligated to register any transfer of a Note (or any portion thereof) if it has reasonable grounds to believe that such transfer is otherwise not in accordance with Applicable Law.

Section 3.7 No Notice of Trusts

No Borrower shall be bound to take any notice of or see to the performance or observance of any duty owed to a third Person (whether under a trust, express, implied, resulting or constructive, in respect of any Note or otherwise) by the beneficial owner or the Holder of a Note or any Person whom such Borrower treats, as permitted or required by law, as the beneficial owner or the Holder of such Notes, and such Borrower may transfer any Note on the direction of the Person so treated or registered as the Holder thereof, whether named as trustee or otherwise, as though that Person were the beneficial owner thereof.

ARTICLE 4

REDEMPTION

Section 4.1 Mandatory Tiered Redemption of Notes

(1)

From the date of this Agreement until July 31, 2012, the Borrowers shall redeem Existing Notes having an aggregate face value equal to 50% of Free Cash Flow for each month in such period. Given the nature and timing of the information needed to calculate the Free Cash Flow, the Borrowers acknowledge that the Administrative Agent shall issue an invoice for each calendar month in such period and the Borrowers shall redeem such amount within five Business Days after its receipt of such invoice.

(2)

Commencing on August 1, 2012, on the last Business Day of each week, the Borrowers shall redeem Existing Notes in the amount of $50,000. The aggregate amount of all such redemptions for each calendar month shall be referred to as the “ Minimum Monthly Base Redemption Amount .” The Borrowers shall also redeem Existing Notes in an amount equal to the positive difference between (A) the greater of (i) $0.05 per gallon of ethanol produced from the Keyes Plant and (ii) 50% of the Free Cash Flow of the Borrowers and (B) the Minimum Monthly Base Redemption Amount (such amount, the “ Additional Monthly Base Redemption Amount ”). Given the nature and timing of the information needed to calculate the Additional Monthly Base Redemption Amount, the Borrowers acknowledge that the Administrative Agent shall issue an invoice for each calendar month that the Administrative Agent determines that the foregoing formula requires that an Additional Monthly Base Redemption Amount is due and the Borrowers shall pay such amount within five Business Days after its receipt of such invoice.

(3)	In addition, the Borrowers shall redeem Existing Notes in the amount of $300,000 on the final Business Day of each Fiscal Quarter commencing with the third Fiscal Quarter of 2012.

Section 4.2 Redemption on Occurrence of Certain Events

(1)

Partial Redemption . Upon the occurrence of a Redemption Event, the Borrowers shall redeem that portion of the Notes equal to the net proceeds received by the Borrowers from such Redemption Event. The Borrowers shall redeem the Notes in the following order of priority: (a) the Existing Notes, (b) the Acquisition Notes, (c) the Revenue Participation Notes, and (d) the Revolving Notes. Notwithstanding anything to the contrary, in the event that any Company Party completes an equity offering of Capital Stock that results in gross proceeds of at least $50,000,000, the Borrowers shall redeem the Revenue Participation Notes for an amount equal to the sum of the then outstanding principal balance, plus all accrued and unpaid interest owing thereon. In addition, to the extent that any Company Party completes an equity offering of Capital Stock that results in gross proceeds of at least $50,000,000 and any Note Indebtedness remains outstanding, the Borrowers shall redeem the Notes in an amount equal to 100% of the monthly Free Cash Flow of the Borrowers; provided, however, the Borrowers shall be permitted to make Revolving Loan Requests in accordance with Section 2.4 hereof.

(2)

Full Redemption . In addition to and not in limitation of the foregoing, on the earlier of: (a) the Applicable Stated Maturity Date; (b) a Change of Control or (c) the occurrence and continuation of an Event of Default upon acceleration by the Administrative Agent in accordance with Section 8.2, the Borrowers shall redeem the Notes for an amount equal to the sum of the then outstanding principal balance, plus all accrued and unpaid interest owing thereon,plus the Acquisition Notes Redemption Fee (if applicable) , and pay in full all other obligations owing to Administrative Agent or any Noteholder under or in connection with this Agreement and the Notes, which amount shall be calculated on the date of redemption and be payable in cash on demand in immediately available funds on such date.

Section 4.3 Option to Redeem

The Borrowers may, on providing at least sixty (60) days prior written notice to the Administrative Agent, redeem a portion of the Notes then outstanding (in whole number multiples of $100,000 only) at a redemption price, in cash, which is equal to the then principal amount of the Notes to be redeemed, plus all accrued and unpaid interest, plus the Acquisition Notes Redemption Fee (if applicable), together with all other amounts owing to Administrative Agent or any Noteholder under or in connection with this Agreement and the Notes; provided , that the Borrowers may not redeem the Acquisition Notes until after the first anniversary of the date of this Agreement.

Section 4.4 Notice to Redeem

A Notice to Redeem shall be given by the Borrowers to the Administrative Agent no later than the date required pursuant to Section 4.1, Section 4.2 or Section 4.3, as the case may be, and in the manner provided in Article 11, which notice (each a “ Notice to Redeem ”) shall specify: (i) the date on which the redemption is to occur (a “ Redemption Date ”) (ii) the amount of the Redemption (the “Amount to be Redeemed” ), and each Holder's pro rata share to be redeemed, as applicable; (iii) that any portion of any Note not redeemed will continue to accrue interest pursuant to its terms, and (iv) that, unless the Borrowers default on the payment of the Amount to be Redeemed, any Note, or any portion thereof, prescribed for redemption pursuant to the Notice to Redeem shall cease to accrue interest on and after the Redemption Date.

Section 4.5 Manner of Redemption

On the Redemption Date, the Borrowers shall pay the pro rata Amount to be Redeemedtogether with all accrued and unpaid interest to the Administrative Agent on behalf of each Holder .

Section 4.6 Cancellation of Notes on Redemption

On the Redemption Date, each Note in respect of which a Notice to Redeem has been given for the entire amount outstanding thereunder shall be deemed to be transferred by the Holder thereof, without any further act or formality on its part (including delivery for cancellation of the original Note, free and clear of all liens, claims and encumbrances, to the Borrowers for cancellation and the Borrowers shall be deemed to have cancelled such Noteupon deemed delivery and the name of such Holder will be removed from the Register with respect to such cancelled Note and such Noteshall be forthwith cancelled by the Borrowers and may not be reissued or resold and no Notes shall be issued in substitution therefor.

ARTICLE 5

SECURITY

Section 5.1 Company Security Documents

To secure the due payment and performance of its Note Indebtedness,each Borrowers shall execute and deliver to theAdministrative Agentfor the benefit of the Secured Parties the Security Documents to which such Borrowers is or will be a party, which shall at all times constitute first ranking Liens on all Collateral of such Borrower, subject only to Permitted Encumbrances that by law rank in priority.

Section 5.2 Other Obligor Guarantees and Security Documents

(1)

The Parent shall, and shall cause (i) each of the Company Parties (other than the Borrowers) and thematerial Affiliates of the Parent from time to time to, such materiality to be determined in the reasonable discretion of the Administrative Agent, execute and deliver to the Administrative Agent for the benefit of the Secured Parties (x) an unconditional guarantee of the Note Indebtedness of the Borrowers in form and substance satisfactory to the Administrative Agent, and (y) Security Documents which shall at all times constitute first ranking Liens on all Collateral of the Parent, such Company Party member or material Affiliate, as the case may be, subject only to Permitted Liens that by law rank in priority, and (ii) the Chairman to execute anddeliver to the Administrative Agent for the benefit of the Secured Parties an unconditional guarantee of the Note Indebtedness of the Borrowers, limited to $10,000,000 and supported by the Chairman’s Pledge Agreement, in each case, in form and substance satisfactory to the Administrative Agent. Notwithstanding the foregoing, neither International Biofuels Ltd. nor Universal Biofuels Private Ltd. shall be required to grant security over its assets to the Administrative Agent for the benefit of the Secured Parties.

(2)	The Security Documents executed by the Obligors shall secure their Note Indebtedness, including their obligations under their respective Guarantees.

Section 5.3 Registration of the Security

(1)

The Parent shall, and shall cause the other Obligors to, at the Borrower’s expense, register, file, record and give notice of (or cause to be registered, filed, recorded and given notice of) the Security Documents in all offices where such registration, filing, recording or giving notice is necessary for the perfection of the Lien constituted thereby and to ensure that such Lien is first ranking, subject only to Permitted Liens which rank by law in priority.

(2)

Within fifteen (15) Business Days of any amendments to the Register which either add or delete a Noteholder to the list of registered Noteholders or change the address for notice of a Noteholder, the Parent shall, and shall cause the other Company Parties to, at the Borrower’s expense,register, file, record and give notice of such addition or deletion of Noteholder or change of address as may be required to ensure that the registrations made or required to be made pursuant to this Section 5.3 properly reflect the Noteholders described in the Register from time to time, to the extent necessary or desirable to preserve the rights and remedies of the Administrative Agent and the other Secured Parties under the Security Documents.

Section 5.4 Blocked Account Agreements

The Parent shall not, and shall not permit (x) any Borrower or (y) any other Company Party to the extent the Administrative Agent has given notice that Blocked Account Agreements will be required with respect to such Company Party, to open or maintain any deposit account or other bank account except to the extent such deposit account or other bank account is subject to a Blocked Account Agreement.

Section 5.5 After Acquired Property and Further Assurances

The Parent shall, and shall cause the other Obligorsto, from time to time, execute and deliver all such further deeds or other instruments of conveyance, assignment, transfer, mortgage, pledge or charge as may be necessary or desirable in the opinion of the Administrative Agent to ensure that any additional interests in the Collateral acquired after the date hereof and required to be subject to a Lien pursuant to the terms hereof are subject to the Liens created or intended to be created pursuant to the Security Documents as required by this Agreement in the manner contemplated hereby.

ARTICLE 6

COVENANTS OF THE COMPANY

Section 6.1 Information Covenants

The Parent shall deliver, or cause to be delivered, to the Administrative Agent (and to otherwise make available for each of the Noteholders)until the Notes have been fully redeemed and all other Note Indebtedness has been paid and performed in full:

(a)

Annual Reporting. As soon as available and in any event within ninety (90) days after the end of each Fiscal Year, (i) an Annual Business Plan for the then current Fiscal Year and (ii) a consolidated balance sheet of the Parent as of the end of such Fiscal Year and the related consolidated statements of income, shareholders or stockholders' equity, and statements of cash flow for such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all reported by such party in accordance with GAAP and audited, without “going concern” or like qualification or exception, or qualification arising out of the scope of the audit, by McGladrey, LLP or one of its Affiliates or another firm of independent public accountants acceptable to the Administrative Agent;

(b)

Quarterly Reporting. As soon as available and in any event within forty five (45) days after the end of each of the Fiscal Quarters of each Fiscal Year, consolidated balance sheets of the Parent as of the end of such Fiscal Quarter, the related consolidated statement of income for such Fiscal Quarter and for the portion of such party's Fiscal Year ended at the end of such Fiscal Quarter and the related consolidated statement of cash flows for the portion of such Fiscal Year ended at the end of such Fiscal Quarter, each prepared in accordance with GAAP (except that such balance sheets and other financial statements may not contain all footnote disclosures required in accordance with GAAP and may be subject to normal year-end audit adjustments) setting forth in each case, a comparative form of the figures for (A) the corresponding quarter and the corresponding portion of such party's previous Fiscal Year and (B) the Parent’s projections for each such Fiscal Quarter;

(c)

Monthly Reporting. As soon as available and in any event within fifteen (15) days after the end of each calendar month, consolidated balance sheet of the Borrowers as of the end of such calendar month, the related consolidated statement of income for such calendar month and for the portion of the Fiscal Year ended at the end of such calendar month and the related consolidated statement of cash flows for the portion of such Fiscal Year ended at the end of such calendar month, each prepared in accordance with GAAP (except that such balance sheets and other financial statements may not contain all footnote disclosures required in accordance with GAAP and may be subject to normal year-end audit adjustments) setting forth in each case, a comparative form of the figures for (A) the corresponding calendar month and the corresponding portion of such party's previous Fiscal Year and (B) the Borrowers’ projections for each such calendar month, together with a management commentary, in each case, in form and substance satisfactory to the Administrative Agent;

(d)

Compliance Certificate. Simultaneously with the delivery of each set of financial statements referred to in Section 6.1(a), Section 6.1(b) and Section 6.1(c), a Compliance Certificate, which shall include, with respect to the financial statements delivered pursuant to Section 6.1(a), confirmation that each Borrower has obtained or caused to be obtained, and continues to maintain in good standing, all licenses and certifications necessary or desirable in connection with the Keyes Facility and the business of the Borrowers;

(e)

Weekly Reporting. As soon as available and in any event by the first Business Day following each week until the Borrowers have demonstrated achievement of two consecutive Fiscal Quarters of positive Free Cash Flow pursuant to the financing statements delivered in accordance with Section 6.1, a weekly cash flow budget, variance analysis to budget and management commentary, in each case, in form and substance satisfactory to the Administrative Agent.

(f)	Daily Reporting. On a daily basis, production reports including revenues, payments, costs, cash receipts and operating metrics from all product sources, including account data on all products sold, in each case in form and substance satisfactory to the Administrative Agent.

(g)	Budget Analysis. On each June 1 and December 1, updates of monthly cash flow projections and Capital Expenditures budget, in form and substance satisfactory to the Administrative Agent;

(h)

Blocked Account Reporting. Unless the Administrative Agent has electronic access to a Blocked Account, within five (5) Business Days after the end of each calendar month, a statement issued by the applicable Blocked Account Provider with respect to such Blocked Account, including the amount of cash and cash equivalents held in such Blocked Account;

(i)	Shareholder Reports. Promptly upon the mailing or delivery thereof to the shareholders or stockholders of the Parent, copies of all financial statements, reports and any proxy statements so mailed;

(j)	SEC Reports. Promptly upon the filing thereof, copies of all registration statements and reports on Forms 10-K, 10-Q, and 8-K (or their equivalent) which the Parent shall have filed with the United States Securities and Exchange Commission.

(k)

Insurance Renewals. Promptly following the Parent's annual renewal of its insurance policies, a certificate of insurance coverage from the insurer in form and substance reasonably satisfactory to the Administrative Agent evidencing the insurance coverage required to be maintained pursuant to Section 6.3(m) and, if requested, will furnish the Administrative Agent copies of the applicable insurance policies referenced therein;

(l)

Business Information. Promptly upon the Administrative Agent’s reasonable request, in respect of the Company Parties, the Keyes Plant or any other assets (as applicable) (i) technical and engineering reports prepared by independent experts in connection with the Company Parties’ business, industry or assets, including the Keyes Plant; (ii)copies of material and selected contracts and authorizations; (iii)pipeline, backlog and sales summaries; (iv) productsales and operating income summaries segmented by customer and product or service offering; (v) organizational charts and compensation of all personnel; (vi) copies of reports sent to shareholders and directors; and (vii) such further schedules, documents, and information as the Administrative Agent may reasonably require.

(m)

Notice of Litigation or Liens. Give notice to the Administrative Agent immediately upon becoming aware of any Lien that is not a Permitted Lien or the commencement of any material action, litigation, proceeding, arbitration, investigation, grievance or dispute affecting any Company Party, the Keyes Plant, the other Properties or any Company Party’s Affairs;

(n)	Notice of Default. Give notice to the Administrative Agent immediately upon becoming aware of any Default or Event of Default or any event or circumstance which would have a Material Adverse Effect;

(o)	Notice of Termination. Give notice to the Administrative Agent immediately upon becoming aware of the resignation or termination of any Director or any Senior Officer.

(p)

Environmental Reporting. Promptly following a Senior Officer becoming aware of the receipt of same, any notice or other information received by any Company Party indicating (i) any potential, actual or alleged non-compliance with or violation of the requirements of any Environmental Law which could result in liability to any Company Party for fines, clean up or any other remediation obligations or any other liability in excess of $100,000 (to the extent not paid or fully covered by insurance as to which the relevant insurance company has acknowledged coverage in writing thereof and a copy of such acknowledgment has been provided to the Administrative Agent) in the aggregate; (ii) any environmental matter imposing on any Company Party a duty to report to a Governmental Entity or to pay cleanup costs or to take remedial action under any Environmental Law which could result in liability to any Company Party for fines, clean-up and other remediation obligations or any other liability in excess of $100,000 (to the extent not paid or fully covered by insurance as to which the relevant insurance company has acknowledged coverage in writing thereof and a copy of such acknowledgment has been provided to the Administrative Agent) in the aggregate; or (iii) the existence of any Lien arising under any Environmental Law securing any obligation to pay fines, clean up or other remediation costs or any other liability in excess of $100,000 in the aggregate. Without limiting the foregoing, each Company Party shall provide to the Administrative Agent promptly upon receipt of same by any Company Party copies of all environmental consultants' or engineers' reports received by any Company Party;and

(q)	Other Information. From time to time such additional information regarding the financial position or business of any Company Party as the Administrative Agentmay reasonably request.

Section 6.2 Financial Covenants

The Parent agrees with the Administrative Agent and each Noteholder that, until the Notes have been fully redeemed and all other Note Indebtedness has been paid and performed in full, the Parent will comply with the following financial covenants:

(a)	Free Cash Flow. Commencing with the Fiscal Quarter ending December 31, 2012, the Parent shall maintain trailing Free Cash Flow, tested as at the last day of each Fiscal Quarter of not less than $1,500,000 per Fiscal Quarter;

(b)	Keyes Plant Minimum Quarterly Production. The Parent shall cause the Borrowers to maintain minimum quarterly production of ethanol at the Keyes Plant of not less than 14 million gallons per Fiscal Quarter;

(c)

Ratios of Note Indebtedness to Keyes Plant Values. The Parent will not permit at any time the ratios of Note Indebtedness to (i) the Keyes Plant Market Value, to exceed seventy-five percent (75%), and (ii) the Keyes Plant Orderly Liquidation Value to exceed eighty-five percent (85%), in each case tested semi-annually as of the last day of the first Fiscal Quarter and as of the last day of the third Fiscal Quarter of each Fiscal Year; and

(d)	Consolidated Unfunded Capital Expenditures. The Parent will not incur or permit to be incurred Consolidated Unfunded Capital Expenditures in excess of $50,000 in any Fiscal Quarter.

Section 6.3 Affirmative Covenants

The Parent and the Borrowers covenant with theAdministrative Agent and each of the Noteholders that,until the Notes have been fully redeemed and all other Note Indebtedness has been paid and performed in full, the Parent shall do the following (and the each Borrower covenants to comply with the following):

(a)	Corporate Existence. Except as otherwise permitted in this Agreement, preserve and maintain, and cause each of the other Company Parties to preserve and maintain, its corporate existence;

(b)

Punctual Payment. The Borrowers shall duly and punctually pay or cause to be paid to every Noteholder or Administrative Agent, as the case may be, all fees and the principal of, and interest accrued on such Noteholder's Notes (including, in the case of default, interest at the Default Rate) on the dates, at the places, in the currency and in the manner mentioned herein and in the Notes;

(c)

Books and Records . The Parent shall, and shall cause each of the other Company Parties to, keep or cause to be kept proper books of account and make or cause to be made therein true and complete entries of all of its dealings and transactions in relation to its business in accordance with GAAP, and at all reasonable times it shall furnish or cause to be furnished the Administrative Agent or to any Holder of Notes or its duly authorized agent or attorney such information relating to its operations as the Administrative Agent or such Holder of Notes may reasonably require and such books of account shall at all reasonable times be open for inspection by the Administrative Agent or the Noteholders or such agent or attorney in accordance with Section 6.3(o)below;

(d)

Liens . Each Borrower shall, and shall cause each of the other Company Parties to, ensure that each of the Security Documents shall at all times constitute valid and perfected first-rankingLiens on all of the Collateral in favour of the Administrative Agent for the benefit of the Secured Parties, subject only to Permitted Liens which rank by law in priority;

(e)	Compliance with Agreement. Each Borrower shall, and shall cause each of the other Company Parties to, duly and punctually perform and carry out all of the covenants and acts or things to be done by it as provided in this Agreement and all other Note Purchase Documents;

(f)	Compliance with Laws, etc. Comply, and cause each of the other Company Parties to comply, in all material respects, with the requirements of all Applicable Laws;

(g)

Compliance with Contracts. Comply,and cause each of the other Company Parties to comply, with each of the contractual obligations (including those under Leases) owing by itto its customers, suppliers and other Persons if non-compliance could have a Material Adverse Effect; and comply, and cause each of the other Company Parties to comply, with each of its contractual obligations under theFinancing Documents, the Financial Instruments, the Note Purchase Documents and Leases;

(h)	Credit Policy and Accounts Receivable. Maintain, and cause each of the other Company Parties to maintain, at all times, written credit policies consistent with good business practices, adhere to such policies and collect accounts receivable in the ordinary course of business;

(i)

Comply with Environmental Laws. Shall, and shall cause each of the other Company Parties and their respective agents to (i) manage and operate the Properties in compliance with all Environmental Laws, (ii) maintain all Authorizations and make all registrations required under all Environmental Laws in relation to the Properties and remain in material compliance therewith, (iii) store, treat, transport, generate, otherwise handle and dispose of all Hazardous Materials owned, managed or controlled by the Company Parties in compliance with all Environmental Laws in all material respects, and (iv) comply with all recommendations contained in any environmental impact assessment in all material respects;

(j)

Maintenance of Equipment and Properties. Maintain, and cause each of the other Company Parties to maintain, all property and assets, including all Equipment, Buildings and Fixtures and Properties, necessary to carry on its business. From time to time, make and cause each of the other Company Parties to make all necessary repairs, renewals, replacements, additions and improvements to the Buildings and Fixtures and the Properties and their other properties and assets, including, without limitation, the Equipment, so that the Business and the other Company Parties’ respective businesses, as the case may be, may be conducted at all times in accordance with Applicable Law;

(k)

Payment of Taxes and Claims. Pay or cause to be paid and cause each of the other Company Parties to pay or cause to be paid, when due, (i) all taxes, assessments and governmental charges or levies imposed upon it or upon its income, sales, capital or profit or any other property belonging to it or to the other Company Parties, and (ii) all claims which, if unpaid, might by law become a Lien upon the assets, except any such tax, assessment, charge, levy or claim which is being contested in good faith and by proper proceedings and in respect of which a Borrower or the other Company Parties have established adequate reserves in accordance with GAAP or which are Permitted Liens;

(l)	Auditors. Provide prior written notice of any change of McGladrey, LLP or one of its Affiliates as the auditor of the Parent and its Subsidiaries to the Administrative Agent, which change shall be subject to the consent of the Administrative Agent;

(m)

Maintenance of Insurance. Maintain, in respect of each of the Company Parties, with financially sound and reputable insurers, insurance with respect to the properties and business of the Company Parties against loss, damage, risk, or liability of the kinds customarily insured against by persons carrying on a similar business. The Parent will cause the Company Parties to comply with all of the terms and conditions of each of the insurance policies which it maintains pursuant to the Note Purchase Documents. The Parent will ensure that each Person contracted by the Parent or any of the other Company Parties to perform construction or related services with respect to, or to provide Equipment with respect to, the Keyes Plant, the Properties and the Buildings and Fixtures maintains general liabilityon terms and in amounts reasonably satisfactory to the Administrative Agent and, with written notice from the Administrative Agent, such other insurance, including equipment, automotive, engineering, earthquake on terms and in amounts reasonably satisfactory to the Administrative Agent. The Parent shall (i) notify the Administrative Agent whenever there is a loss with respect to any of the Collateral; (ii) within three (3) Business Days of a request from the Administrative Agent, provide the Administrative Agent with all information required to file claims under any relevant insurance policy; and (iii) assist the Administrative Agent with the filing of claims under any relevant insurance policy. Notwithstanding any of the foregoing, no Company Party shall have any recourse against the Administrative Agent in the event that (i) the Administrative Agent shall fail to submit a valid claim under any relevant insurance policy or (ii) the insurer shall deny any claim under any relevant insurance policy;

(n)

Key Man Insurance. Maintain key man life insurance policy on the life of the Chairman in an amount not less than $10,000,000, together with an executed assignment of such policy to the Administrative Agent acknowledged by the insurer and deliver evidence of the same to the Administrative Agent within 60 days of the First Closing Date;

(o)

Rights of Inspection. At any time during the Parent’s regular business hours,permit any employee, officer, agent or other representative of the Administrative Agent and the Noteholders at the expense of the Borrowers, to examine and make copies of any abstracts from the records and books of account of any Company Party and to discuss any of the Affairs of anyCompany Party with any of its directors, officers, employees, agents, representatives or auditors, it being understood that this Section 6.3(o)is not, and should not be construed as, a waiver of any attorney-client or similar privilege. At any time and from time to time,upon five (5) days’ prior notice, permit any officer, agent or other representative of the Administrative Agent, at the expense of the Borrowers, to perform appraisals and conduct field examinations of the Collateral and discuss any of the Affairs of any Company Party with any of the personnel of the Parent and third party contractors. Notwithstanding the foregoing, the Administrative Agent may conduct or cause to be conducted appraisals of the Keyes Plant at any time provided that, unless a Default or Event of Default has occurred and is continuing, the Borrowers will not be required to bear the expense of more than two (2) such appraisals during any calendar year;

(p)

Blocked Accounts. The Parent shall, and shall cause each Borrower and each other Company Party to the extent such Company Party is required to obtain Blocked Account Agreements required pursuant to Section 5.4, and each Blocked Account Provider, to cause all revenues of the Parent and the Borrowers and such other Company Party, and proceeds of Collateral of such Persons, to be deposited into accounts subject to one or more Blocked Account Agreements, to allow the Administrative Agent access to view all account activity via on-line and web access and, if such on-line and web access is unavailable, to mail the Administrative Agent at least once a month (or more times per month upon Administrative Agent's reasonable request) copies of all account statements and disbursement sums in such account;

(q)	Conduct of Business . The Parent will continue, and will cause each of the other Company Parties to continue, to engage in the Business or a business substantially similar and/or related thereto;

(r)

Maintenance of Property . The Parent will and will cause each other Company Party to, in all material respects, promptly: (i) pay and discharge, or make commercially reasonable efforts to cause to be paid and discharged, when due all royalties and expenses accruing under any agreement affecting or pertaining to its Properties, (ii) perform, or make reasonable and customary efforts to cause to be performed, the obligations of the Parent or other Company Party required by each and all of the assignments, deeds, leases, sub-leases, contracts and agreements affecting its interests in its Properties, (iii) do all other things necessary to keep unimpaired, except for Permitted Liens, its rights with respect to its Properties and prevent any forfeiture thereof or a default thereunder, except for dispositions permitted by this Agreement and except when the failure to do so does not or could not, individually or in the aggregate, have a Material Adverse Effect. The Parent will and will cause each other Company Party to operate its Properties or cause or make reasonable and customary efforts to cause such Properties to be operated in a careful and efficient manner, subject to ordinary wear and tear, materially in accordance with the practices of the industry in compliance with all applicable Material Agreements and in compliance with all Governmental Entities, except where the failure to do so does not, or could not, individually or in the aggregate, have a Material Adverse Effect;

(s)

Title Due Diligence . The Parent shall, upon the request of the Administrative Agent, cause to be delivered to the Administrative Agent such title due diligence regarding title to the Collateral owned by the Company Parties and the perfection and priority of the Administrative Agent's liens therein, as and to the extent such Collateral are required to be mortgaged pursuant hereto, as are reasonably appropriate to determine the status thereof;

(t)

Authorizations. The Parent shall, and shall cause each of the other Company Parties to, obtain and maintain in full force all Authorizations necessary for the ownership and operation of the Keyes Plant, the other Properties and the Business and perform and observe all covenants, conditions and restrictions contained in, or imposed on it by, any Authorization where failure to do would have a Material Adverse Effect;

(u)	Provision of Staff. The Parent shall ensure that there are sufficient competent technical and management employees or contractors engaged in connection with the Keyes Plant to enable the achievement of the covenants hereunder.

(v)

Material Adverse Effect. The Parent shall, and shall cause each of the other Company Parties to,promptly notify the Administrative Agent of any event or circumstance or any potential event or circumstance that would reasonably be expected to have a Material Adverse Effect on the Keyes Plant, the Business or the other Properties;

(w)	Additional Properties. The Parent shall, and shall cause each of the other Company Parties to, promptly notify the Administrative Agent upon acquisition of any additional Properties;

(x)

Business Outside Certain Jurisdictions. The Parent shall, and shall cause each of the other Company Parties to, at least 30 days prior to any of the following changes becoming effective, notify the Administrative Agent in writing of (i) any proposed change in the location of (w) any place of business of the Parent or any other Company Party, (x) the chief executive office or head office of any Borrower or any other Company Party, and (y) any place where tangible property of the Parent or any other Company Party is stored, and (ii) any proposed change in the name of the Parent or any other Company Party. Promptly notify the Administrative Agent in writing upon becoming aware of any change in location of any account debtor of the Parent or any other Company Party to a jurisdiction outside of the United States of America;

(y)

Perfection and Protection of Security. The Parent shall, and shall cause each of the other Company Parties to, at the request of the Administrative Agent, grant to the Administrative Agent, for the benefit of the Secured Parties, security interests, assignments, mortgages, charges and pledges in such property and undertaking of the Parent and the other Company Parties and other material Affiliates of the Parent that is not subject to a valid and perfected first ranking charge or security interest (subject only to Permitted Liens) in each relevant jurisdiction as determined by the Administrative Agent and deliver opinions in form and substance satisfactory to the Administrative Agent thereon with respect to such matters as the Administrative Agent may request. The Parent shall also perform, execute and deliver, or cause to be performed, executed and delivered, all acts, agreements and other documents as may be reasonably requested by the Administrative Agent at any time to register, file, signify, publish, perfect, maintain, protect, and enforce the Security or grant a security interest on its property including, without limitation, (i) executing, recording and filing of the Security Documents and financing or continuation statements in connection therewith, in form and substance reasonably satisfactory to the Administrative Agent, (ii) delivering to the Administrative Agent the originals of all unit certificates, instruments, documents and chattel paper and all other Collateral of which the Administrative Agent reasonably determines the Administrative Agent should have physical possession in order to perfect and protect the Security, duly endorsed or assigned to the Administrative Agent, (iii) delivering to the Administrative Agent warehouse receipts covering any portion of the Collateral located in warehouses and for which warehouse receipts are listed, (iv) placing notations on its books of account to disclose the Security, (v) delivering to the Administrative Agent all letters of credit on which aCompany Party is named beneficiary, (vi) obtaining subordination agreements, acknowledgments or other documents from third parties in order to ensure that the Security constitutes first priority Liens on the Collateral (subject only to Permitted Liens that by law rank in priority), and (vii) taking such other steps as are deemed reasonably necessary by the Administrative Agent to maintain the Security and the first ranking priority thereof (subject only to Permitted Liens that by law rank in priority);

(z)	Board Observation Rights.

(A) The board of directors of the Parent shall hold a meeting (which may be held by conference call) at least quarterly for the purpose of discussing the business and operations of such Person and its Subsidiaries, including the Borrowers. The Parent shall notify the Administrative Agent of the date and time for each regular and special meeting of its board of directors or any committee thereof or of the adoption of any resolutions by written consent (describing in reasonable detail the nature and substance of such action) at the same time and in the same manner that notice is provided to the directors of the Parent and provide to the Administrative Agent any materials delivered to the directors of the Parent at the same time such materials are provided to such directors. The Administrative Agent shall be free to contact the directors of the Parent and discuss the pending actions to be taken.

(B) The Parent shall permit one authorized representative of the Administrative Agent to attend and participate in all meetings of such Person’s board of directors and any committee thereof, whether in person, by telephone or otherwise (such representative is sometimes referred to herein as the “ Observer ”). The Parent shall provide the Observer with such notice and other information with respect to such meetings as are delivered to the directors of such Person. If attendance in person by the Parent’s board of directors is required, the Parent shall pay such representative’s reasonable out-of-pocket expenses (including, without limitation, the cost of airfare, meals and lodging) in connection with the attendance at such meetings.

(C) The Holders and each Observer to whom observation rights are provided under Section 6.3(z)(B) above, acknowledge and agree that the Parent is a public company whose securities are registered with the SEC, and as such: (i) any information concerning the Parent and the other Borrowers obtained as a result of the exercise of such observation rights shall be deemed Information (as defined in Section 12.18 ); (ii) any Information concerning the Parent and the other Borrowers obtained as a result of the exercise of such observation rights may constitute material non-public information that the Parent is providing to the Holders and the Observer in reliance upon their agreements hereunder and the Parent’s reliance upon Rule 100(b)(2)(ii) of Regulation FD promulgated under the rules of the SEC; and (iii) the Holders and each Observer shall be subject to the same insider trading policies adopted by the Parent from time to time, as are applicable to the Parent’s board of directors, and to any restrictions, rules and regulations of the SEC regarding insider trading, or the use or dissemination of material non-public information, by members of a public company’s board of directors. Prior to acting as an Observer, the Holders shall cause each Observer to acknowledge and agree, in writing, to this Section 6.3(z)(C) and Section 12.18 (regarding confidentiality), and provide a copy of such written agreement to the Parent and the Borrowers; provided , however , that notwithstanding anything to the contrary herein, the Administrative Agent and the Holders may elect at any time upon written notice to the Parent and the Borrowers to suspend their rights under paragraphs (A) and (B) of this Section 6.3(z) , and from and after the date that is 90 days after the date of such notice until the date of delivery of any subsequent written notice from the Administrative Agent to the Parent and the Borrowers that the Administrative Agent is reinstituting its rights under paragraphs (a) and (b) of this Section 6.3(z) , neither the Administrative Agent nor any Observer shall be subject to the insider trading policies adopted by the Parent that are applicable to the Parent’s board of directors.

(D) Notwithstanding the foregoing, the Parent shall have the right to exclude the Observer from any portion of its board of director or committee meetings to the extent reasonably necessary to preserve its attorney-client privilege or attorney-client work product privilege as determined in good faith by the board of directors with advice from counsel or with respect to any discussions regarding the refinancing or restructuring of the Indebtedness owed to the Holders.

(aa)

Further Assurances. At its cost and expense, upon reasonable request of the Administrative Agent, execute and deliver or cause to be executed and delivered to the Administrative Agent such further instruments and do and cause to be done such further acts as may be necessary or proper in the reasonable opinion of the Administrative Agent to carry out more effectually the provisions and purposes of the Note Purchase Documents or confirm the truth and accuracy of the representations and warranties contained in the Note Purchase Documents.

(bb)

Post-Closing. Within 30 days following the First Closing Date and in each case, in form and substance reasonably satisfactory to the Administrative Agent, the Borrowers shall deliver to the Administrative Agent (i) a duly executed landlord waiver by the landlord party to the lease for the Leased Property located at 20400 Stevens Creek Boulevard, Suite 700, Cupertino, California, (ii) evidence of the dissolution of Sutton Ethanol, LLC, (iii) Blocked Account Control Agreements with respect to the deposit accounts of each Company Party and (iv) evidence of earthquake insurance with respect to the Cilion Plant (so long as the cost thereof is not cost prohibitive in the reasonable discretion of the Administrative Agent).

Section 6.4 Negative Covenants

The Parent and the Borrowers hereby covenant and agree with Administrative Agent and the Noteholders that, until the Notes have been fully redeemed and all other Note Indebtedness has been paid and performed in full, the Parent shall not directly or indirectly (and each Borrower covenants to comply with the following):

(a)	Indebtedness. Create, incur, assume or suffer to exist,or permit any of the other Company Parties to create, incur, assume or suffer to exist, any Indebtedness other than Permitted Indebtedness;

(b)	Hedging. Enter into or allow to exist,or permit any of the other Company Parties to enter into or allow to exist, a Financial Instrument which is of a speculative nature or on a margined basis;

(c)	Liens. Create, incur, assume or suffer to exist, or permit any of the other Company Parties to create, incur, assume or suffer to exist, any Lien on any of their respective properties or assets, whether now owned or hereafter acquired, other than Permitted Liens.

(d)

Mergers, Etc. Subject to the next following sentence, enter into, or permit any of the other Company Parties to enter into, any reorganization, consolidation, amalgamation, arrangement, winding-up, merger or other similar transaction. Any Company Party and any other Company Party may enter into such transactions with each other if (i) at the time of such transaction and immediately after giving effect to the transaction, no event shall have occurred and be continuing which constitutes a Default or Event of Default, (ii) the surviving company shall be a company organized and existing under the laws of the United States of America or one of its states or districts, (iii) the continuing corporation assumes the obligations of eachCompany Party that is party to such transaction under the Note Purchase Documents and grants such additional security as may be reasonably required by the Administrative Agent, and (iv) the Secured Parties receive an opinion of counsel to the Company Parties reasonably acceptable to them;

(e)	Disposal of Assets Generally. Sell, exchange, lease, release or abandon or otherwise dispose of, or permit any other Company Party to sell, exchange, lease, release or abandon or otherwise dispose of, any assets or properties to any Person other than Permitted Asset Dispositions;

(f)

Transactions with Related Parties. Directly or indirectly, enter into or allow any other Company Party to enter into, any agreement with, make any financial accommodation for, or otherwise enter into any transaction with, a Related Party except (i) in the ordinary course of, and pursuant to the reasonable requirements of, business and at prices and on terms not less favourable to the Parent or the other Company Party, as the case may be, than could be obtained in a comparable arm’s length transaction with another Person, (ii) a Company Party may pay reasonable compensation to officers, employees and consultants for actual services rendered to a Company Party in the ordinary course of business and (iii) a Company Party may pay directors’ fees to and reimburse actual out-of-pocket expenses incurred in connection with attending board of director meetings not to exceed in the aggregate for the Parent and the other Company Parties, with respect to all such items, $100,000 in any Fiscal Year. Notwithstanding the foregoing, no Obligor may enter into a transaction with another Obligor without the prior written consent of the Administrative Agent;

(g)	Change in Business. Make any material change in the nature of the Business or permit any of the other Company Parties to make any material change in the nature of its business;

(h)

Acquisitions. Purchase or otherwise acquire,or permit any other Company Party to purchase or otherwise acquire, (in one or a series of related transactions) any part of the property (whether tangible or intangible) of any Person (or agree to do any of the foregoing at any future time) other than: (i) Capital Expenditures to the extent permitted under Section 6.2(d); (ii) purchases and other acquisitions of Inventory, materials, Equipment and intangible property in the ordinary course of business; (iii) investment in Cash Equivalents; (iv) leases of real property in the ordinary course of business; (v) Permitted Acquisitions; and (vi) reorganizations, amalgamations and other transactions permitted under Section 6.4(d); provided , in each case, that any such property acquired shall be subject to perfected or registered first ranking priority Lien (subject only to Permitted Liens that by law rank in priority) in favour of the Administrative Agent for the benefit of the Secured Parties free and clear of all Liens other than Permitted Liens;

(i)

Capital. Other than Capital Stock of the Parent, issue, or permit any of the other Company Parties to issue, Capital Stock, or any options, warrants or securities convertible into Capital Stock, provided that any Capital Stock, option, warrants or securities issued to the Parent or any other Company Party must be pledged to the Administrative Agent pursuant to the Security Documents;

(j)	Distributions. Declare, make or pay, or permit any Company Party to declare, make or pay, any Distributions;

(k)

Financial Assistance. Give, or permit any of the other Company Parties to give, any Financial Assistance to any Person, except for (i) Intercompany Indebtedness permitted pursuant to Section 6.4(a), (ii) investments in Cash Equivalents, (iii) extensions of trade credit by a Borrower or any other Company Party in the ordinary course of the Business or its business, as the case may be, (iv) Financial Assistance which constitutes a Permitted Acquisition, (v) investments by a Company Party in another Company Party and (vi) such other Financial Assistance as the Administrative Agent may approve in writing in the exercise of its sole discretion. Notwithstanding anything to the contrary, no Company Party shall provide any Financial Assistance to, or make any investments in, International Biofuels, Ltd., Universal Biofuels Private, Ltd. or Sutton Ethanol, LLC.

(l)	Organizational Documents. Amend, or allow any of the other Company Parties to amend, any of their Organizational Documents;

(m)	Fiscal Year. Change, or allow any of the other Company Parties to change, their Fiscal Year;

(n)

Subsidiaries. Incorporate or acquire, or permit any of the other Company Parties to incorporate or acquire, any Subsidiaries or commence to carry on the Business otherwise than through a Borrower and its Subsidiaries, except for Permitted Acquisitions where, in each case, the Subsidiary (i) is a wholly-owned Subsidiary, and (ii) has executed and delivered to the Administrative Agent an unconditional and unlimited guarantee of all Note Indebtedness of the Borrowers together with perfected first-ranking Security over all of its property and assets and accompanied by opinions satisfactory to the Administrative Agent;

(o)	Use of Proceeds. The Borrowers shall use the proceeds of the Notes only for the purposes described in Section 2.18 and shall not use such proceeds for any other purpose;

(p)

Accounts. Open or maintain, or permit any of the other Company Parties required to obtain Blocked Account Agreements pursuant to Section 5.4 to, open or maintain any securities account or deposit account except to the extent such securities account or deposit account is subject to a Blocked Account Agreement;

(q)	ERISA. Except for the Parent’s 401(k) Plan, establish, maintain, contribute to or be required or allowed to contribute to, or permit any other Company Party to establish, maintain, contribute to or be required or allowed to contribute to, any Plan or Multiemployer Plan; or

(r)	Material Contracts. Permit itself or permit any of the other Company Party to amend, vary, alter or terminate, consent to any assignment or transfer of, or waive or surrender any of its rights or entitlements under, any Material Contract.

(s)

Negative Pledge Clauses . Enter into or suffer to exist or become effective any agreement that prohibits or limits the ability of any Company Party to create, incur, assume or suffer to exist any Lien upon any of its property or revenues, whether now owned or hereafter acquired, other than (i) this Agreement and the other Financing Documents and (ii) any agreements governing any Purchase Money Mortgages or Capital Lease Obligations otherwise permitted hereby (in which case, any prohibition or limitation shall only be effective against the assets financed thereby).

(t)

Clauses Restricting Subsidiary Distributions . Enter into or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Company Party to (a) make Distributions in respect of any Capital Stock of such Company Party held by, or pay any Indebtedness owed to, Parent or any other Company Party, (b) make loans or advances to, or other investments in, the Parent or any Company Party or (c) transfer any of its assets to the Parent or any Company Party, except for such encumbrances or restrictions existing under or by reason of (i) any restrictions existing under the Note Purchase Documents and (ii) any restrictions with respect to a Company Party imposed pursuant to an agreement that has been entered into in connection with the sale, transfer or other disposition of all or substantially all of the Capital Stock or assets of such Company Party.

(u)	Subordinated Debt. Pay or otherwise redeem, exchange, purchase, retire or defease any Subordinated Debt, including any regularly scheduled payments of interest on the Subordinated Debt.

(v)

Acquisition Fees . Except for the payment of certain fees to UBS on the First Closing Date approved by the Administrative Agent, pay any other investment banking fees or expenses to UBS related to the Acquisition until such time that the Parent completes an private of public offering of its Capital Stock pursuant to a private or public offering that results in proceeds to the Parent of at least $5,000,000.

ARTICLE 7

REPRESENTATIONS AND WARRANTIES

Section 7.1 Representations and Warranties

As a material inducement to the Administrative Agent and Noteholders to enter into this Agreement and for the Noteholders to purchase the Notes, the Parent hereby represents and warrants, as of the date of this Agreement (and, to the extent such representation or warranty pertains to a Borrower or its Subsidiaries, such Borrower represents and warrants that such representations and warranties are true and correct), that:

(a)

Incorporation and Qualification. The Parent is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada. Each Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Each other Company Party is duly organized, validly existing and in good standing under the laws of its jurisdiction of formation as set forth in Schedule 7.1(a). The Parent and each of the other Company Partiesis qualified, licensed or registered to carry on business under the laws applicable to it in all jurisdictions in which such qualification, licensing or registration is necessary or where failure to be so qualified would have a Material Adverse Effect;

(b)

Corporate Power. Each of the Company Parties has all requisite corporate power and authority to (i) own, lease and operate its properties and assets and to carry on its business as now being conducted by it in all material respects, and (ii) enter into and perform its obligations under the Financing Documents to which it is a party;

(c)

Conflict With Other Instruments. The execution and delivery by each Company Party and the performance by it of its obligations under, and compliance with the terms, conditions and provisions of, the Financing Documents to which it is a party does not (i) conflict with or result in a breach of any of the terms or conditions of (A) its Organizational Documents or by-laws, (B) any Applicable Law, or (C) any contractual restriction binding on or affecting it or its properties, or (ii) result in, require or permit (A) the imposition of any Lien in, on or with respect to any of its assets or property (except in favour of the Administrative Agent for the benefit of the Secured Parties), (B) the acceleration of the maturity of any Indebtedness binding on or affecting any Company Party, or (C) any third party to terminate any Material Contract;

(d)

Corporate Action, Governmental Approvals, etc. The execution and delivery of each of the Financing Documents by each Company Party and the performance by each Company Party of its obligations under the Financing Documents to which each such Company Party is party have been duly authorized by all necessary corporate action including, without limitation, the obtaining of all necessary equityholder consents. No Authorization, registration, qualification, designation, declaration or filing with any Governmental Entity or other Person, is or was necessary in connection with the execution, delivery and performance of obligations under the Financing Documents except as are in full force and effect, unamended, at the date of this Agreement;

(e)

Execution and Binding Obligation . This Agreement and the other Financing Documents have been or, upon execution, will be duly executed and delivered by each Company Party which is a party thereto and constitute legal, valid and binding obligations of such Company Party enforceable against it in accordance with their respective terms, subject only to any limitation under applicable laws relating to (i) bankruptcy, insolvency, arrangement or creditors’ rights generally, and (ii) the discretion that a court may exercise in the granting of equitable remedies;

(f)	No Default or Event of Default . No Default or Event of Default has occurred which has not been either remedied (or otherwise ceased to be continuing) to the satisfaction of the Administrative Agent, or expressly waived by the Administrative Agent on behalf of the Noteholders, in writing;

(g)

All Authorizations Obtained and Registrations Made . All Authorizations, filings and registrations necessary or of advantage to permit each Company Party to (i) create first priority perfected Liens (enforceable or opposable, as the case may be, against third parties and any trustee in bankruptcy) in the Collateral and the proceeds thereof (subject to Permitted Liens that rank by law in priority), (ii) consummate the transactions contemplated by the Financing Documents, (iii) own its undertaking, property and assets unless the failure to obtain or maintain such Authorization, filing or registration would not have a Material Adverse Effect, and (iv) carry on its business and to own and operate the Keyes Plant and the Properties unless the failure to obtain or maintain such Authorization, filing or registration would not have a Material Adverse Effect (including Authorizations, filings and registrations necessary or of advantage to permit the Borrowers to carry on the Business), have been obtained or effected and are in full force and effect. Each Company Party is in compliance with the requirements of all such Authorizations, filings and registrations and there are no investigations or proceedings existing, pending or, to the Parent's knowledge, after due enquiry, threatened which could result in the revocation, cancellation, suspension or any adverse modification of any of such Authorizations, filings and registrations. The Security Documents create fully perfected security interests in or liens on, as the case may be, all right, title and interest of each Company Party in and to the Collateral specified therein or intended to be charged thereby as security for the obligations specified therein in each case prior and superior in right to any other Lien (subject to Permitted Liens which rank by law in priority);

(h)

Material Contracts. Each of the Company Parties is in material compliance with all Material Contracts and none of the Company Parties, or to the best of the Parent’s knowledge, any other party to any Material Contracts has defaulted under any of the Material Contracts. No event has occurred which, with the giving of notice, lapse of time or both, would constitute a default under, or in respect of, any Material Contract. There is no material dispute regarding any Material Contract;

(i)

Intellectual Property. Each of the Company Parties possesses all Intellectual Property necessary for the conduct of their respective businesses, each of which is in good standing and in full force and effect, except where the failure to possess or maintain in good standing and in full force and effect such Intellectual Property, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. To the best knowledge of the Parent, none of the Company Parties is infringing or is alleged to be infringing on the rights of any Person with respect to any Intellectual Property;

(j)

Ownership and Use of Property. Each of the Company Parties has good and marketable fee simple title to, or a valid leasehold interest in, all its Owned Properties, in each case free and clear of any Liens other than Permitted Liens. Each of the Company Parties has good and merchantable title to all the tangible and intangible personal property reflected as assets in their books and records in each case free and clear of any Liens other than Permitted Liens. No Company Party has any commitment or obligation (contingent or otherwise) to grant any Liens except for Permitted Liens. Each of the Company Parties owns, leases or has the lawful right to use all of the assets necessary for the proper conduct of their respective businesses. Such property, and its use, operation and maintenance for the purpose of carrying on the Business is in compliance with any applicable restrictive covenant and Applicable Law except where the failure to be in compliance, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect;

(k)

Sufficiency of Assets. EachCompany Party has acquired all property, assets and rights and has obtained such other Authorizations and rights as are necessary or required in connection with the operation of the Business. All property, assets and rights are sufficient in scope and substance for the Business and no part of the purchase price payable in connection with the acquisition of such property, assets and rights, remains unpaid;

(l)

Ownership of Properties. Other than as set out on Schedule 7.1(l), none of the Company Parties (i) owns or is bound by any agreement to own any real property, (ii) leases or is bound by any agreement to lease any real property, (iii) has leased any of its Owned Properties or subleased any of its Leased Properties, or (iv) owns or is bound by any agreement to own or leases or is bound by any agreement to lease, sell, encumber, dispose of or grant any right in respect of the Properties;

(m)	Leases. Each Lease is in full force and effect, there are no defaults thereunder and all amounts owing under it have been paid by the relevantCompany Party except to the extent that any such default or such non-payment would not have a Material Adverse Effect;

(n)

Work Orders. There are no issued and outstanding work mandates or permit requirements relating to the Keyes Plant, or to the knowledge of Parent, the other Properties from or required by any Governmental Entity, nor does any Company Party have notice of any possible impending or future work mandate or permit requirement which would have a Material Adverse Effect;

(o)

Expropriation. No part of any of the Properties or the Buildings and Fixtures has been taken or is the subject of an expropriation by any Governmental Entity, no written notice or proceeding in respect of an expropriation been given or commenced nor is the Parent or any Borrower aware of any intent or proposal to give any such notice or commence any proceedings;

(p)

Encroachments. Except for Permitted Liens, the Buildings and Fixtures are located entirely within the Properties and are in conformity with the laws, regulations, and requirements of all applicable Governmental Entities, except to the extent that such non-conformity would not have a Material Adverse Effect. There are no encroachments upon any of the Properties which would have a Material Adverse Effect;

(q)

Compliance with Laws. Each of the Properties has been used, and each of the Company Partiesis, in compliance with all Applicable Laws, including, without limitation, having the necessary Authorizations to carry on the Business, except to the extent that such non-compliance would not have a Material Adverse Effect;

(r)	No Default. None of the Company Parties is in violation of its Organizational Documents or any equityholders’ agreement applicable to it;

(s)

No Material Adverse Agreements. None oftheCompany Parties is a party to any agreement or instrument or subject to any restriction (including any restriction set forth in its organizational documents, by-laws or any equityholders’ agreement applicable to it) which has or, to the best of its knowledge at the time of making this representation, in the future may have a Material Adverse Effect;

(t)	Environmental Compliance. Except as set forth in Schedule 7.1(t):

(i)

none of the Properties (i) has ever been used by any Person as a waste disposal site or a landfill, or (ii) has ever had any asbestos, asbestos-containing materials, PCBs, radioactive substances or aboveground or underground storage systems, active or abandoned, located on, at or under it at the date of this Agreement;

(ii)	to the best knowledge of the Parent and the Borrowers, no properties adjacent to any of the Properties are contaminated by any Hazardous Materials;

(iii)

there are no Hazardous Materials located on, at or under the Properties; and

(iv)	none of theCompany Parties has transported, removed or disposed of any waste to a location outside of the United States of America as at the date of this Agreement;

(u)	ERISA. Except for the Parent’s 401(k) Plan, none of the Company Parties nor any ERISA Affiliate of any Company Party has or has ever maintained or contributed to (or has or has ever had an obligation to contribute to) any Plan or Multiemployer Plan;

(v)

Labor Matters. None of theCompany Parties has any collective bargaining agreements. There are no strikes or other labor disputes againstany of the Company Parties pending or, to the knowledge of the Parent and the Borrowers, threatened that (individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect. Hours worked by and payments made to employees of the Company Parties have not been in violation of the Fair Labor Standards Act or any other Applicable Law dealing with such matters that (individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect. All payments due from the Company Parties on account of employee health and welfare insurance that (individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect if not paid have been paid or accrued as a liability on the books of the relevant Company Party;

(w)

Tax Liability . Each of the Company Parties has filed all tax and information returns which are required to be filed. Each of the Company Parties has paid all taxes, interest and penalties shown to be due and payable on such returns or on any assessments made against it or any of its property and all other taxes, fees or other charges imposed on it or any of its property by any Governmental Entity (other than any the amount or the validity of which are currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided on the books of the relevant Company Party). Adequate provision for payment has been made for taxes not yet due. No tax Lien has been filed, and, to the knowledge of the Parent and the Borrowers, no claim is being asserted, with respect to any such tax, fee or other charge. There are no tax disputes existing or pending involving any Company Party or the Business which could reasonably be expected to have a Material Adverse Effect;

(x)	Corporate Structure . At the date of this Agreement:

(i)	the Company Parties and the equityholders of the Company Parties are set out in a corporate chart on Schedule 7.1(x);

(ii)	none of the Company Parties is, directly or indirectly, a member of, or a partner or participant in, any partnership, joint venture or syndicate other than as disclosed on Schedule 7.1(x);

(y)

Financial Statements . The audited consolidated financial statements of the Parent, copies of each of which have been furnished to the Administrative Agent and the Noteholders, fairly present the consolidated financial position of the Parent at such dates and the consolidated results of the operations and changes in financial position of the Parent for such period, all in accordance with GAAP;

(z)

Indebtedness . No Company Party has any Indebtedness except as not prohibited under Section 6.4(a). Except as set forth in Schedule 7.1(z), there exists no default or event of default under the provisions of (i) any instrument evidencing Indebtedness in excess of $50,000 or (ii) any instruments evidencing Indebtedness in excess of $50,000 in the aggregate, or of any agreement relating thereto;

(aa)

No Litigation . Except as set forth in Schedule 7.1(aa), there are no material actions, suits or proceedings (including arbitration proceedings) pending, taken or to the Parent’s and the Borrowers’ knowledge, threatened, before or by any Governmental Entity or any arbitrators or by or against any elected or appointed public official or private person in the United States of America or elsewhere, and, to the knowledge of the Parent and the Borrowers, no Applicable Law which affects any Company Party has been enacted, promulgated or applied which (i) challenges, or to the knowledge of the Parent and the Borrowers, has been proposed which may challenge, the validity or propriety of the transactions contemplated under the Financing Documents or the documents, instruments and agreements executed or delivered in connection therewith or related thereto, or (ii) could be reasonably anticipated to have a Material Adverse Effect;

(bb)	Schedule Disclosure. At the date of this Agreement:

(i)

Schedule 7.1(bb)(i) is a list of all jurisdictions (or registration districts within such jurisdictions) in which each Company Party (i) has its chief executive office, head office, registered office and chief place of business, (ii) carries on business, (iii) has any account debtors, or (iv) stores any tangible personal property (except for goods in transit in the ordinary course of business);

(ii)	Schedule 7.1(bb)(ii) is a list of all Authorizations which are material to any Company Party and to the acquisition, ownership, construction or operation of the Properties and the Business;

(iii)

Schedule 7.1(bb)(iii) is a list of all Intellectual Property that is material to any Company Party and the Business;

(iv)	Schedule 7.1(bb)(iv) is a list of all actions, suits, arbitrations or proceedings pending, taken or to the Parent’s and the Borrowers’ knowledge, threatened, before or by any Governmental Entity or other Person affecting any Company Party;

(v)	Schedule 7.1(bb)(v) contains a list of all Material Contracts; a nd

(vi)	Schedule 7.1(bb)(vi)contains a list of all settlement agreements and related orders in connection with any mechanics and materialmen liens against or affecting the Keyes Plant;

(cc)

Insolvency . Other than as disclosed on Schedule 7.1(cc), no Company Party or any of its Subsidiaries nor the Chairman has: (i) not generally paid its debts as they become due; (ii) admitted its inability to pay its debts generally; (iii) made a general assignment for the benefit of creditors; (iv) instituted any proceedings, or had instituted any proceedings against it (x) seeking to adjudicate it a bankrupt or insolvent or (y) seeking liquidation, winding-up, reorganization, compromise, arrangement, adjustment, protection, relief or composition of it or of its debts under any Applicable Law relating to bankruptcy, insolvency or reorganization or relief of debtors or other similar matters or (z) seeking the appointment of a receiver, manager, receiver and manager, trustee, custodian, monitor, or other similar official for it or for any substantial part of its undertaking, property or assets; or (v) taken any organizational or other action to authorize any of the actions set forth above in this Section 7.1(cc);

(dd)

No Liabilities . Except as disclosed in this Agreement or reflected or reserved against in the unaudited balance sheet dated as of March 31, 2012, the Parent has no liabilities or obligations of any nature (whether absolute, accrued, contingent or otherwise) except for current liabilities incurred in the ordinary course since March 31, 2012;

(ee)

Transactions with Related Parties . All transactions with Related Parties are in the ordinary course of and pursuant to reasonable requirements of, business and are at prices and on terms not less favourable to the Company Parties than could be obtained in a comparable arm’s length transaction with another Person and all such transactions are described on Schedule 7.1(ee);

(ff)	Foreign Asset Control Laws . No Company Party is a Person named on a list published by OFAC or is a Person with whom dealings are prohibited under any OFAC Regulations;

(gg)

Federal Regulations . No part of the proceeds of the sale of the Notes will be used for “purchasing” or “carrying” any “margin stock” within the respective meanings of each of the quoted terms under Regulation U as now and from time to time hereafter in effect or for any purpose that violates the provisions of Regulation U. If requested by any Noteholder or the Administrative Agent, each Borrower will furnish to the Administrative Agent and each Noteholder a statement to the foregoing effect in conformity with the requirements of FR Form G-3 or FR Form U-1 referred to in Regulation U;

(hh)

Investment Company Act; Other Regulations . No Company Party is an “investment company”, or a company “controlled” by an “investment company”, within the meaning of the Investment Company Act of 1940, as amended. No Company Party is subject to regulation under any Applicable Law (other than Regulation X of the Board) that limits its ability to incur Indebtedness;

(ii)	Solvency . Each Company Party, after giving effect to the Acquisition and the incurrence of all Indebtedness and other obligations being incurred in connection herewith and therewith will be Solvent; and

(jj)

Disclosure . All (i) forecasts and projections supplied to the Administrative Agent and the Noteholders were prepared in good faith, adequately disclosed all relevant assumptions and (ii) other written information supplied to the Administrative Agent and the Noteholders is true and accurate in all material respects. There is no fact known to the Parent which could reasonably be expected to have a Material Adverse Effect and which has not been fully disclosed to the Administrative Agent and the Noteholders. No event has occurred which could be reasonably anticipated to have a Material Adverse Effect since the date of most recent financial statements delivered pursuant to Section 6.1(a).

(kk)

Private Offering by each Borrower. No Borrower nor anyone acting on its behalf has offered the Notes or any similar securities for sale to, or solicited any offer to buy any of the same from, or otherwise approached or negotiated in respect thereof with, any Person other than the Noteholders, each of which has been offered the Notes at a private sale for investment. No Borrower nor anyone acting on its behalf has taken, or will take, any action that would subject the issuance or sale of the Notes to the registration requirements of Section 5 of the U.S. Securities Act or to the registration requirements of any securities or blue sky laws of any applicable jurisdiction.

ARTICLE 8

DEFAULT AND ENFORCEMENT

Section 8.1 Event of Default

The occurrence of any one or more of the following events shall constitute an “ Event of Default ” hereunder and in respect of the Notes:

(a)

Non-Payment. The Borrowers fail to pay when due and payable (whether at maturity or otherwise) the full amount of any interest, fees (including the Acquisition Notes Redemption Fee), principal, if any, payable on any Note (including any default in payment of any amounts payable upon the occurrence of any Change of Control or any Redemption Event) or any Obligor defaults on its payment obligation under its Guarantee; or

(b)

Breach of Negative and Financial Covenants. Any Company Party defaults in observing or performing any covenant or condition contained in Section 6.2 or Section 6.4of this Agreement, if such default, if capable of being cured by such Company Party, remains uncured for a period of ten (10) days after notice by the Administrative Agent; or

(c)	Breach of Auditor and Key Man Insurance Covenants. Any Company Party defaults in performing any covenant or condition contained in Section 6.3(l) or Section 6.3(n) of this Agreement; or

(d)

Breach of Other Covenants. Any Company Partyor any other Obligor defaults in observing or performing any other covenant or condition of this Agreement or any otherNote Purchase Document on its part to be observed or performed and, with respect to such covenants or conditions which are capable of rectification, if such default, if capable of being cured by such Company Party, remains uncured for a period of ten (10) days after notice by the Administrative Agent; or

(e)

Security Imperilled. Any one or more of the Security Documents ceases to be in full force and effect or to constitute a valid and perfected first priority Lien (subject to Permitted Encumbrances that by law rank in priority)upon all the Collateral it purports to charge or encumber in favour of the Administrative Agent for the benefit of the Secured Parties and such Lien is not remedied or cured by the relevant Obligor within ten (10) days of notice to the Parent by the Administrative Agent, or if the Administrative Agent, determines at any time the Administrative Agent’s Lien in the Collateral on such date is inadequate (determined by the Administrative Agent in its reasonable discretion) or unenforceable (determined by the Administrative Agent in its sole discretion) and such Lien is not remedied or cured by the relevant Obligor within ten (10) days of notice by the Administrative Agent to the Parent; or

(f)

Insolvency Proceeding. The commencement by any Company Party or any other Obligor of any case, proceeding or other action (i) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to it or its debts, or (ii) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets; or the consent by any Company Party or any other Obligorto the institution of bankruptcy or insolvency proceedings against it or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal, provincial or state law relating to bankruptcy, insolvency, reorganization or relief of debtors, or the consent by it to the filing of any such petition or to the appointment under any such law of a receiver, receiver-manager, liquidator, assignee, trustee, sequestrator (or other similar official) of suchCompany Party or other Obligor or of all or substantially all of its property, or the making by it of a general assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due; or

(g)

Insolvency Order. The entry of a decree or order by a court having jurisdiction adjudging any Company Party or any other Obligor a bankrupt or insolvent or approving as properly filed an application or a petition seeking reorganization, arrangement or adjustment of or in respect of the Company Party or such other Obligor under any Applicable Law relating to bankruptcy, insolvency, reorganization or relief of debtors, or appointing under any such Applicable Law a receiver, receiver-manager, liquidator, assignee, trustee, sequestrator (or other similar official) of the Company Partyor such other Obligor or of all or substantially all of their respective property, or ordering pursuant to any such Applicable Law the winding-up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of sixty (60) consecutive days; or

(h)

Liquidation Proceeding. Proceedings are commenced for the winding-up, liquidation or dissolution of any Company Party or any other Obligor, unless the Company Partyor such other Obligor in good faith actively and diligently contests such proceedings, decree, order or approval, resulting in a dismissal or stay thereof within sixty (60) days of commencement; or

(i)	Liquidation Resolution. A resolution is passed for the winding-up, dissolution or liquidation of any Company Party or other Obligor; or

(j)	Cessation of Enforceability. This Agreement, any Note or any otherNote Purchase Document shall for any reason, or is claimed by the Parent, the any Borrower or any other Obligor to, cease in whole or in any part to be a legal, valid, binding and enforceable obligation of any Obligor; or

(k)

Cross-Default. Any Company Party fails to pay the principal of, premium, if any, interest on, or any other amount owing in respect of any of its Indebtedness or any other obligation (i) pursuant to any Financing Document (other than the Note Purchase Documents) or (ii) any other Indebtedness or obligation which is outstanding in an aggregate principal amount exceeding $100,000, in each case, when such amount becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise) and such failure continues after the applicable grace period, if any, specified in the agreement or instrument relating to such Indebtedness or obligation; or any other event occurs or condition exists and continues after the applicable grace period, if any, specified in any agreement or instrument relating to any such Indebtedness or obligation referred to in clauses (i) or (ii) above, if its effect is to accelerate, or permit the acceleration of such Indebtedness or obligation; or any such Indebtedness or obligation shall be, or may be, declared to be due and payable prior to its stated maturity; or

(l)

Misrepresentation. Any representation or warranty made by any Obligor in this Agreement or any other Note Document or that is contained in any certificate, document or financial or other statement furnished by it at any time under or in connection with this Agreement or any other Note Purchase Document shall prove to be incorrect or misleading in any material respect as at the date on which it was made; or

(m)	Material Adverse Effect. The occurrence of any event that could reasonably be expected to have a Material Adverse Effect, including any change in the business, operations or financial condition of the Parentor any other Company Party that has a Material Adverse Effect; or

(n)	Destruction of Collateral. Any destruction or abandonment of any part of the Collateral that is not in the ordinary course of business and that has a Material Adverse Effect; or

(o)

Environmental Liabilities. Any Company Party incurs any liabilities by, under or pursuant to Environmental Laws or which relate to the existence of Hazardous Materials on or about the Keyes Plant or the other Properties which will require expenditures (i) for any one occurrence, in excess of $100,000 or (ii) aggregating in any Fiscal Year on a consolidated basis $100,000; or

(p)

Judgment. Except for the judgments outstanding as of the date hereof and described in the Schedules, a final judgment or decree for the payment of money in excess of $250,000 individually or $250,000 on a cumulative basis is rendered against any Company Party or any other Obligor by a court having jurisdiction and all such judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal within 15 days from entry thereof;or

(q)	Key Man. The Chairman shall be terminated or resign as an officer and employee of the Parent or shall die or be incapable of performing his usual responsibilities as an officer or employee by reason of illness, disease or other disability for 30 days or more; or

(r)

Attachment . There shall be commenced against any Company Party or any other Obligor any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets that results in the entry of an order for any such relief that shall not have been vacated, discharged, or stayed or bonded pending appeal within 30 days from the entry thereof; or

(s)	Change in Control. A Change in Control, without the consent of the Administrative Agent, shall occur.

Section 8.2 Acceleration on Default

(1)

Upon the occurrence and during the continuance of an Event of Default, theAdministrative Agent may (i) declare all Note Indebtedness to be immediately due and payable (including all accrued and unpaid interest and any interest at the Default Rate together with the Acquisition Notes Redemption Fee and all other obligations owing to the Administrative Agent or any Noteholder under or in connection with this Agreement and the Notes), whereupon all such Note Indebtedness shall become due and payable, without presentment, demand, protest or further notice of any kind, all of which are expressly waived by the Borrowers, and (ii) exercise all rights and remedies available under this Agreement, any other Note Purchase Documents and Applicable Law and the Administrative Agent or Noteholders may proceed to protect and enforce its rights by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained in any Note Purchase Document, or for an injunction against a violation of any of the terms thereof, or in aid of the exercise of any power granted thereby or by law or otherwise. Notwithstanding any provision of any Note Purchase Document and without limiting any of the other rights and/or remedies of the Administrative Agent or any Noteholder, if an Event of Default under Section 8.1(f)through Section 8.1(i) occurs, all of the Note Indebtedness shall be immediately due and payable immediately without any action, presentment, demand, protest or notice of any kind, all of which hereby are expressly waived by the Company Parties). Notwithstanding anything to the contrary in any Note Purchase Document and for the avoidance of doubt, any reference in any Note Purchase Document to an Event of Default existing, or having occurred and being in continuance, shall remain an Event of Default until it has been waived in accordance with such Note Purchase Document.

(2)

Notwithstanding anything contained in this Agreement, the Notes or any other Note Purchase Document to the contrary, if the principal amount and any accrued and unpaid interest on the Notes, together with the Acquisition Notes Redemption Fee, become due and payable in accordance with this Section 8.2, then the Borrowers shall pay forthwith to Administrative Agent for the benefit of the Noteholders, on a pro rata basis, the principal of, and accrued and unpaid interest (including interest on amounts in default) on such Notes, together with the Acquisition Notes Redemption Fee and all other fees and expenses payable hereunder, together with subsequent interest thereon at the rate borne by the Notes from the date such amounts are due and payable in accordance with this Section 8.2 until payment is received by the Noteholders. Such payment when made shall be deemed to have been made in discharge of the Borrowers’ obligations hereunder.

(3)	Except as expressly provided in Section 8.1 or 8.2, presentment, demand, protest and all other notices of any kind are hereby expressly waived by the Borrowers and the Parent.

Section 8.3 Waiver of Default

If an Event of Default shall have occurred, the Administrative Agent shall have the power to waive any Event of Default hereunder and all the Noteholders shall be bound by any such waiver upon such terms and conditions as the Administrative Agent shall prescribe; provided that no delay or omission of Administrative Agent or any of the Noteholders to exercise any right or power accruing upon any Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or acquiescence therein and provided further that no act or omission of Administrative Agent or any Noteholders shall extend to or be taken in any manner whatsoever to affect any subsequent Event of Default hereunder or the rights resulting therefrom.

Section 8.4 Enforcement by the Noteholders

If an Event of Default shall have occurred, but subject to Section 8.3:

(a)

the Administrative Agent may proceed to enforce the rights of Administrative Agent and the Noteholders by any action, suit, remedy or proceeding authorized or permitted by any of the Note Purchase Documents or by Applicable Law or equity; and may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Administrative Agent and the Noteholders filed in any bankruptcy, insolvency, winding-up or other judicial proceedings relating to any Company Party;

(b)	no such remedy for the enforcement of the rights of Administrative Agent or any of the Noteholders shall be exclusive of or dependent on any other such remedy but any one or more of such remedies may from time to time be exercised independently or in combination; and

(c)	all rights of action hereunder or under any of the Security Documents or any other Note Purchase Document may be enforced by Administrative Agent or the Noteholders without the possession of any of the Notes or the production thereof on the trial or other proceedings relating thereto.

Section 8.5 Right of Setoff

To the extent permitted by law, (i) in the case an Event of Default shall occur and be continuing or shall exist, the Administrative Agent and Noteholders shall have the right, in addition to all other rights and remedies available to them, without notice to the Borrowers or any other Person, to setoff against and to appropriate and apply to the unpaid balance of the Notes, all accrued interest thereon, the Acquisition Notes Redemption Fee, and all other obligations of the Borrowers hereunder and under the Notes and all other Financing Documents, any debt owing to, and any other funds held in any manner for the account of the Borrowers by Administrative Agent or any Noteholder, including, without limitation, all funds in all deposit accounts (general or special) subject to any Blocked Account Agreement now or hereafter maintained by a Borrower for its own account with Administrative Agent or any Noteholder and Administrative Agent and Noteholder are hereby granted a security interest in and lien on all such debts (including, without limitation, all such deposit accounts) for such purpose; and (ii) such right shall exist whether or not Administrative Agent or any Noteholder shall have made any demand under this Agreement, the Notes and whether or not the Notes and such other obligations are matured or unmatured. Notwithstanding anything else contained within this Agreement, the Administrative Agent will not issue an activation notice under any Blocked Account Agreement until such time as an Event of Default has occurred.

Section 8.6 Application of Moneys

Notwithstanding any provision herein to the contrary, all proceeds and any other amounts collected or received in respect of any Note Indebtedness evidenced by the Notes or any other amounts owing by the Borrowers to Administrative Agent or any Noteholder: (a) after any or all of such Note Indebtedness has been accelerated (so long as such acceleration has not been rescinded) or (b) in respect of any sale of, collection from or other realization upon all or any part of the Collateral pursuant to the exercise by Administrative Agent or any Noteholder of such party's rights or remedies under any Note Purchase Document during the continuance of an Event of Default, shall be applied as follows: (1) first, to the payment of the principal balance of the Notes to be applied on a pari passu basis; (2) second, to the payment of all accrued and unpaid fees owing to Administrative Agent and the Noteholders under the Note Purchase Documents; (3) third, to the payment of all accrued and unpaid interest on the Notes to be applied on a pari passu basis; (4) fourth, to the payment of all costs, liabilities, advances and expenses incurred, or required or permitted to be incurred by the Administrative Agent relating to or arising out of the Collateral, the Note Indebtedness evidenced by the Notes or the Note Purchase Documents, including without limitation, the maintenance, operation, preservation and disposition thereof and all other payments that Administrative Agent may be required or authorized to make thereunder, (5) fifth, to all other Note Indebtedness, and (6) sixth, any surplus then remaining to the Borrowers, unless otherwise provided by law or directed by a court of competent jurisdiction.

Section 8.7 Remedies Cumulative

No remedy herein conferred upon or reserved to Administrative Agent or any of the Noteholders is intended to be exclusive of any other remedy, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or under any Note Purchase Document or now or hereafter existing by law or by statute. Each holder of the Notes shall have all rights and remedies set forth in this Agreement, the Note the other Note Purchase Documents and all rights and remedies which such holders have been granted at any time under any other agreement or contract and all of the rights such holders have under any law or in equity. Any Person having any rights under any provision of this Agreement shall be entitled to enforce such rights specifically (without posting a bond or other security), to recover damages by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law.

Section 8.8 Judgment Against the Borrowers

In the case of any judicial or other proceedings to enforce the rights of the Noteholders, including, without limitation, obtaining judgment for the principal of or interest on the Notes, judgment may be rendered against the Borrowers in favour of Administrative Agent and/or the Noteholders for any amount which may remain due in respect of the Notes.

Section 8.9 Administrative Agent May Perform Covenants

If the Parent or any Borrower shall fail to perform any of its covenants contained herein, after a Default or Event of Default, the Administrative Agent may perform any of such covenants capable of being performed by it, but is under no obligation to do so. All reasonable sums so required to be paid in connection with Administrative Agent's performance of any covenant will be paid by the Borrowers and all sums so paid shall be payable by the Borrowers on demand. No such performance by Administrative Agent of any covenant contained herein or payment or expenditure by the Borrowers of any sums advanced or borrowed by Administrative Agent pursuant to the foregoing provisions shall be deemed to relieve the Parent or the Borrowers from any default hereunder or its continuing obligations hereunder.

ARTICLE 9

SATISFACTION AND DISCHARGE

Section 9.1 Cancellation

Each Note surrendered to the Borrowers, shall be cancelled by the Borrowers forthwith after payments required in respect thereof to the date of surrender have been made. Subject to Applicable Law, all Notes cancelled or required to be cancelled under this or any other provision of this Agreement shall be destroyed by the Borrowers in accordance with the Borrowers’ ordinary practice, and a notation may be made on the Register as to such cancellation.

Section 9.2 Non-Presentation of Notes

If the Holder of any Note shall fail to present the same for payment on the date on which the principal thereof, premium, if any, and/or the interest thereon or represented thereby becomes payable at maturity or otherwise or shall not accept payment on account thereof and give such receipt therefor (if any) as the Borrowers may reasonably require interest shall cease to accrue on such Note from and after maturity or such other applicable date and the Holders thereof shall thereafter have no right to receive payment in respect thereof except upon due presentation and giving of such receipt therefore as the Borrowers may reasonably require.

ARTICLE 10

THE ADMINISTRATIVE AGENT AND NOTEHOLDERS

Section 10.1 Authorization and Action

Each Noteholder irrevocably appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers under this Agreement and the other Note Purchase Documents as are delegated to it by the terms of this Agreement and the other Note Purchase Documents, together with all powers reasonably incidental thereto. As to any matters not expressly provided for by this Agreement and the other Note Purchase Documents, the Administrative Agent shall act or refrain from acting (and shall be fully protected in so doing) upon the joint instructions of the Required Holders which instructions shall be binding upon all Noteholders. The Administrative Agent shall not be required to take any action which (i) would expose it to personal liability, (ii) is contrary to this Agreement or any applicable law, rule, regulation, judgment or order, (iii) would require it to become registered to do business in any jurisdiction, or (iv) would subject it to taxation. The provisions of this Article are solely for the benefit of the Administrative Agent and the Noteholders, and no Borrower nor any other Obligor shall have rights as a third-party beneficiary of any of such provisions. It is understood and agreed that the use of the term “agent” herein or in any other Note Purchase Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

Section 10.2 No Liability

(1)

The Administrative Agent shall have no duties or obligations other than as set out in this Agreement and the other Note Purchase Documents and there shall not be construed against the Administrative Agent any implied duties (including fiduciary duties), obligations or covenants. The Administrative Agent may execute or perform, and may delegate the execution and performance of, any of its powers, rights, discretions and duties under the Note Purchase Documents through or to any Persons designated by it. References in any Note Purchase Document to the Administrative Agent shall include references to any such Persons.

(2)

The Administrative Agent is not obliged to (i) take or refrain from taking any action or exercise or refrain from exercising any right or discretion under the Note Purchase Documents, or (ii) incur or subject itself to any cost in connection with the Note Purchase Documents, unless it is first specifically indemnified or furnished with security by the Noteholders, in form and substance satisfactory to it (which may include further agreements of indemnity or the deposit of funds).

(3)

The Administrative Agent shall promptly deliver to each Noteholder any notices, reports or other communications contemplated in this Agreement which are intended for the benefit of the Noteholders. The Administrative Agent shall be deemed not to have knowledge of any Default or Event of Defalt unless and until notice describing such Default or Event of Default is given to the Administrative Agent in writing by the Borrowers, the Parent or a Noteholder.

(4)

Neither the Administrative Agent nor its directors, officers, agents or employees shall be liable to the Noteholders for any action taken or omitted to be taken by it or them in connection with the Note Purchase Documents except for its or their own gross negligence or wilful misconduct as determined by a court of competent jurisdiction on a final and non-appealable basis. Without limiting the generality of the foregoing, the Administrative Agent (i) may consult with legal counsel (including legal counsel for the Borrowers), independent accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken by it in accordance with their advice, (ii) makes no warranty or representation to the Noteholders and shall not be responsible to the Noteholders for the form, substance, accuracy or completeness of any Note Purchase Document or any other documents or information made available to the Noteholders, (iii) has no duty to inspect the property or assets (including books and records) of the Borrowers or any other Person, (iv) has no duty to ascertain or inquire as to the existence of a Default or an Event of Default or the observance of any of the terms or conditions of the Note Purchase Documents, (v) is not responsible to the Noteholders for the execution, enforceability, genuineness, sufficiency or value of any of the Note Purchase Documents or for the validity, perfection or priority of any Lien created or purported to be created under the Security Documents, and (vi) shall incur no liability by acting upon any notice, certificate or other instrument believed by it to be genuine and signed or sent by the proper Person. In determining compliance with any condition hereunder to the purchase of any Note that by its terms must be fulfilled to the satisfaction of a Noteholder, the Administrative Agent may presume that such condition is satisfactory to such Noteholder unless the Administrative Agent shall have received notice to the contrary from such Noteholder prior to the purchase of such Note.

Section 10.3 Administrative Agent as Noteholder

To the extent it is also a Noteholder, the Administrative Agent has the same rights and powers under this Agreement in its capacity as Noteholder as any other Noteholder and may exercise such rights and powers as though it were not the Administrative Agent. The Administrative Agent and its Affiliates may engage in any kind of business with, the Company Parties, any of their respective Subsidiaries, or any Person who may do business with or own securities of such Persons, all as if it were not the Administrative Agent and without any duty to account to the Noteholders.

Section 10.4 Noteholder Credit Decisions

Each Noteholder acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Noteholder or any of their Related Parties and based on such documents and information as it has been deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Noteholder also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Noteholder or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Note Purchase Document or any related agreement or any document furnished hereunder or thereunder.

Section 10.5 Indemnification

Each Noteholder shall indemnify and save the Administrative Agent harmless (to the extent not otherwise reimbursed by the Borrowers) rateably from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgements, suits, costs, expenses or disbursements of any kind whatsoever that may at any time (whether before or after the payment or redemption of the Notes) as a result of, or arising out of, the Note Purchase Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by the Administrative Agent under or in connection with any of the foregoing provided that no Noteholder shall be liable for any part of such loss resulting from the gross negligence or wilful misconduct of the Administrative Agent in its capacity as agent as determined by a court of competent jurisdiction on a final and non-appealable basis. Without limiting the foregoing, each Noteholder shall reimburse the Administrative Agent upon demand for its rateable share of any out-of-pocket expenses incurred by the Administrative Agent in connection with the preparation, execution, administration or enforcement of, or legal advice in respect of rights or responsibilities under, the Note Purchase Documents (to the extent not otherwise reimbursed by the Borrowers). The agreements in this Section 10 shall survive the payment of the Notes and all other amounts payable hereunder.

Section 10.6 Liability of the Noteholders inter se

Each of the Noteholders agrees with each of the other Noteholders that, except as otherwise expressly provided in this Agreement, none of the Noteholders has or shall have any duty or obligation, or shall in any way be liable, to any of the other Noteholders in respect of the Note Purchase Documents or any action taken or omitted to be taken in connection with them.

Section 10.7 Successor Administrative Agents

The Administrative Agent may resign at any time by giving written notice to the Noteholders and the Borrowers, such resignation to be effective upon the appointment of a successor Administrative Agent. Upon notice of any resignation, the Required Holders have the right to appoint a successor Administrative Agent who, provided no Default or Event of Default has occurred and is continuing, shall be acceptable to the Borrowers, acting reasonably. If no successor Administrative Agent is appointed or has accepted the appointment within thirty days after the retiring Administrative Agent’s notice of resignation, then the retiring Administrative Agent may, on behalf of the Noteholders, appoint a successor Administrative Agent, which may be a Noteholder. Upon the acceptance of the appointment by a successor Administrative Agent, the successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent and the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement. After any retiring Administrative Agent’s resignation, the provisions of this Article 10 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent.

ARTICLE 11

NOTICES

Section 11.1 Notices

All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given when delivered personally to the recipient, sent to the recipient by reputable overnight courier service (charges prepaid), mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid or for purposes of Section 8.1, by electronic mail. Such notices, demands and other communications shall be sent to Administrative Agent and to the Parent and each Borrower at the address indicated below:

	To the Parent:

	Aemetis, Inc.
	20400 Stevens Creek Boulevard, Suite 700
	Cupertino, CA 95014

	Attention:	Mr. Todd Waltz, Chief Financial Officer
	Telephone:	408-213-0925
	Email:	TWaltz@aemetis.com

	To each Borrowers:

	c/o Aemetis, Inc.
	20400 Stevens Creek Boulevard, Suite 700
	Cupertino, CA 95014

	Attention:	Mr. Todd Waltz, Chief Financial Officer
	Telephone:	408-213-0925
	Email:	TWaltz@aemetis.com

	To the Administrative Agent:

	Third Eye Capital Corporation Brookfield Place, TD Canada Trust Tower 161 Bay Street, Suite 3930 Toronto, ON M5J 2S1

	Attention:	Mr. Algis Vaitonis, Head of Portfolio Operations
	Telephone:	416-601-2270
	Email:	algis@thirdeyecapital.com

or to such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party. Such notice shall be deemed to have been given on the date of such delivery if such date is a Business Day and the delivery was made during normal business hours, otherwise it shall be deemed to have been given on the next Business Day following such delivery.

ARTICLE 12

MISCELLANEOUS

Section 12.1 Counterparts and Facsimile

This Agreement may be executed in counterparts and by electronic transmission of an authorized signature and each such counterpart shall be deemed to form part of one and the same document.

Section 12.2 Language of Agreement

The Parties agree that the English language shall be the sole language governing the interpretation of the terms and conditions of this Agreement.

Section 12.3 No Strict Construction

The Parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.

Section 12.4 Complete Agreement

This Agreement, those documents expressly referred to herein and other documents of even date herewith, embody the complete agreement and understanding among the Parties and supersede any prior agreements or representations by or among the Parties, written or oral, which may have related to the subject matter hereof in any way.

Section 12.5 Indemnification

(1)

The Parent and theBorrowers shall pay (i) all expenses incurred by the AdministrativeAgent and the Noteholders, including the fees, charges and disbursements of counsel (including local counsel), in connection with the preparation, negotiation, execution, delivery and administration of this Agreement and the other Note Purchase Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), and (ii) all expenses incurred by the Noteholders and the Administrative Agent, including the fees, charges and disbursements of counsel (including local counsel), in connection with the enforcement or protection of their rights in connection with this Agreement and the other Note Purchase Documents, including their rights under thisSection 12.5, or in connection with the Notes issued hereunder, including all such expenses incurred during any workout, restructuring or negotiations in respect of such Notes.

(2)

The Parent and the Borrowers shall indemnify theAdministrative Agent (and any sub-agent thereof), each Noteholder, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee” ) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including the fees, charges and disbursements of any counsel for any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any third party or by any Obligor arising out of, in connection with, or as a result of:

(a)

the execution or delivery of this Agreement, any other Note Purchase Document or any agreement or instrument contemplated hereby or thereby, the performance or non-performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation or non-consummation of the transactions contemplated hereby or thereby;

(b)	any Note or the use or proposed use of the proceeds therefrom;

(c)

the presence of Hazardous Materials in, on, at, under or about, or the discharge or likely discharge of Hazardous Materials from, any of the properties comprised in the Collateral or any of the properties now or previously used or occupied by the Company Parties, any of theirrespective Subsidiaries or any of the other Obligors, or the breach by or non-compliance with any Environmental Law by any mortgagor, owner or lessee of such properties, or any liability imposed pursuant to Environmental Law or relating to the existence of Hazardous Materials on, under or about the properties comprised in the Collateral and related in any way to the Company Parties or any of theirrespective Subsidiaries; or

(d)

any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by an Obligor and regardless of whether any Indemnitee is a party thereto, provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross negligence or wilful misconduct of such Indemnitee or (y) result from a claim brought by the Borrowers or any other Obligor against an Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder or under any other Note Purchase Document, if the Obligor has obtained a final and non-appealable judgment in its favour on such claim as determined by a court of competent jurisdiction.

(3)

To the fullest extent permitted by Applicable Law, neither the Parent nor any of the other Company Parties shall assert, and hereby waive, any claim against any Indemnitee, on any theory of liability, for indirect, consequential, punitive, aggravated or exemplary damages (as opposed to direct damages) arising out of, in connection with, or as a result of, this Agreement, any other Note Purchase Document or any agreement or instrument contemplated hereby (or any breach thereof), the transactions contemplated hereby or thereby, any Notes or the use of the proceeds thereof.

(4)

All amounts due under thisSection 12.5 shall be payable promptly after demand therefor. A certificate of theAdministrative Agent or a Noteholder setting forth the amount or amounts owing to such Administrative Agent, Noteholder or a sub-agent or Related Party, as the case may be, as specified in this Section, including reasonable detail of the basis of calculation of the amount or amounts, and delivered to the Borrowers shall be conclusive absent manifest error.

(5)

The provisions of thisSection 12.5 shall survive the termination of this Agreement and the redemption of all Notes. To the extent required by law to give full effect to the rights of the Indemnitees under thisSection 12.5, the parties hereto agree and acknowledge that theAdministrative Agent and each Noteholder is acting as agent for its respective Related Parties and agrees to hold and enforce such rights on behalf of such Related Parties as they may direct. Each of the Parent and the Borrowers acknowledges that neither its obligation to indemnify nor any actual indemnification by it of the Noteholders, the Administrative Agent or any other Indemnitee in respect of such Person’s losses for legal fees and expenses shall in any way affect the confidentiality or privilege relating to any information communicated by such Person to its counsel.

Section 12.6 Acknowledgments

Each of the Parent and the Borrowers hereby acknowledges that:

(1)	it has been advised by counsel in the negotiation, execution and delivery of this Agreement and other Note Purchase Documents;

(2)

neither Administrative Agent nor any Noteholder shall have any fiduciary relationship with or duty to the Parent or the Borrowers arising out of or in connection with this Agreement or any of the other Note Purchase Documents, and the relationship between Administrative Agent and Noteholders, on one hand, and the Parent or the Borrowers, on the other hand, in connection herewith or therewith is solely that of debtor and creditor; and

(3)	no joint venture is created hereby or by the other Note Purchase Documents or otherwise exists by virtue of the transactions contemplated hereby.

Section 12.7 Attorney

Each Borrower hereby irrevocably constitutes and appoints the Administrative Agent (and any officer or agent thereof) as its true and lawful attorney with power to, upon the occurrence of an Event of Default, in the place of such Borrower and in its name with full power of substitution, for the purpose of carrying out the terms of this Agreement and the other Note Purchase Documents, to take any action and to execute documents and instruments which may be necessary or desirable to accomplish the purposes of such agreements. This power of attorney is irrevocable, is coupled with an interest, has been given for valuable consideration (the receipt and adequacy of which is acknowledged) and survives, and does not terminate upon, bankruptcy, dissolution, winding up, insolvency of such Borrower. This power of attorney extends to and is binding upon such Borrower’s successors and permitted assigns. The Administrative Agent shall not be liable to any Borrower for any action taken by the Administrative Agent or its designee under such power of attorney, except to the extent that such action was taken by the Administrative Agent in bad faith or with gross negligence or wilful misconduct. This power of attorney shall terminate without further writing upon the payment in full of the Notes.

Section 12.8 Amendments and Waivers

Except as otherwise expressly provided herein, the provisions of this Agreement and the Notes may be amended or waived and the Parent and theBorrowers may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Parent and theBorrowers have executed a written copy of such amendment and has obtained the written consent of the Administrative Agent which shall be binding on the Noteholders; provided that no such action shall (i) change the rate at which or the manner in which interest accrues on the Notes or the time at which such interest becomes payable, (ii) terminate or release all or substantially all of the Security, (iii) change the definition of Required Holders, or (iv) change any provision relating to the scheduled payments or prepayments of principal on the Notes, without the written consent of all the Holders of the outstanding principal amount of the Notes. No other course of dealing with the Parent or the Borrowers or any delay in exercising any rights hereunder or under the Note, or otherwise shall operate as a waiver of any rights of any such Holders.

Section 12.9 Successors and Assigns

(1)

This Agreement shall become effective when executed by the Parent, the Borrowers, the Administrative Agent and each Holder and after that time shall be binding upon and inure to the benefit of the Parent, the Borrowers, the Administrative Agent, and the Holders and their respective successors and permitted assigns.

(2)	Neither the Parent nor any Borrower shall have the right to assign its rights or obligations under this Agreement or any interest in this Agreement without the prior consent of all the Holders, which consent may be arbitrarily withheld.

(3)

A Holder may grant participations in all or any part of its interest in the Notes to one or more Persons (each a “ Participant ”). The Holder granting a participation shall, unless otherwise expressly provided in this Agreement, act on behalf of all of its Participants in all dealings with the Borrowers in respect of the Notes and no Participant shall have any voting or consent rights with respect to any matter requiring the Holders’ consent. A Holder may also with the prior written consent of the Administrative Agent assign or transfer all or any part of its interest in the Notes to a transferee in compliance with Article 3.

(4)

Each Borrower shall assist the Administrative Agent and any Holder to transfer its Notes or to sell participations under this Section 12.9 in whatever manner reasonably necessary in order to enable or effect such transfer or participation including providing such certificates, acknowledgments and further assurances in respect of this Agreement and the Notes as such Holder may reasonably require in connection with transfer or any participation pursuant to this Section 12.9.

(5)

Any Holder may at any time pledge or grant a security interest in all or a portion of its rights under this Agreement to secure obligations of such Holder provided that no such pledge or security shall release such Holder from any of its obligations hereunder or substitute any such pledge for such Holder as a party hereto.

(6)

Any transfer or any grant of participation pursuant to this Section will not constitute a repayment by the Borrowers to the transferring or granting Holder of the Notes, nor a new purchase of Notes by the Holder,transferee or Participant, as the case may be, and the parties acknowledge that the Borrowers’ obligations with respect to any such Notes will continue and will not constitute new obligations.

Section 12.10 Waiver of Right to Jury Trial

EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER FINANCING DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING WITH RESPECT TO ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH OF THE PARTIES HERETO (A) ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT FOR THE PARTIES TO THE FINANCING DOCUMENTS TO ENTER INTO A BUSINESS RELATIONSHIP, THAT THE PARTIES TO THE FINANCING DOCUMENTS HAVE ALREADY RELIED ON THIS WAIVER IN ENTERING INTO SAME AND THE TRANSACTIONS THAT ARE THE SUBJECT THEREOF, AND THAT THEY WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS, AND (B) FURTHER WARRANTS AND REPRESENTS THAT EACH HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, MODIFICATIONS, SUPPLEMENTS, EXTENSIONS, RENEWALS AND/OR REPLACEMENTS OF THIS AGREEMENT.

Section 12.11 Waiver and Acknowledgement

The Parties waive any rights and remedies relating to applicable usury or similar laws now or hereafter enacted in respect of the Financing Documents and acknowledge and agree that the obligations of the Parties pursuant to or in connection with the Financing Documents shall continue to be enforceable obligations of the Parties, irrespective of any such claims by any Person that payments made in connection with the Financing Documents are in an amount or calculated at a rate which would be prohibited by law, would result in a receipt by the Administrative Agent or by the Noteholders of interest at a criminal rate or are otherwise excessive, unconscionable, coercive, oppressive or punitive in any manner whatsoever.

Section 12.12 Announcements

The Administrative Agent shall have the right to review and approve any public announcement or public filing made after the date hereof relating to any of the transactions contemplated hereby or relating to the Administrative Agent or its Affiliates, as the case may be, before any such announcement or filing is made (such approval not be unreasonably withheld or delayed).

Section 12.13 Maximum Rate of Interest

This Notes are expressly limited so that in no contingency or event whatsoever, whether by acceleration of maturity of the Note Indebtedness evidenced thereby or otherwise, shall the amount paid or agreed to be paid to the Noteholder for the use, forbearance or detention of the money advanced or to be advanced hereunder exceed the highest lawful rate permissible under the laws of the State of Delaware. If, from any circumstances whatsoever, fulfillment of any provision of the Notes shall, at the time performance of such provisions are due, be deemed to be a payment of interest in excess of that authorized by law, the obligation to be fulfilled shall be reduced to the limit so authorized by law, and if, from any circumstances, the Noteholder shall ever receive an amount which would exceed the highest lawful rate, such amount which would be excessive interest shall be applied to the reduction of the unpaid principal balance of the indebtedness evidenced hereby and by the Notes and not to the payment of interest.

Section 12.14 Judgment Currency

If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due to a Secured Party in any currency (the “Original Currency” ) into another currency (the “Other Currency” ), the parties agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be that at which, in accordance with normal banking procedures, such Secured Party could purchase the Original Currency with the Other Currency on the Business Day preceding the day on which final judgment is given or, if permitted by applicable law, on the day on which the judgment is paid or satisfied.

The obligations of the Parent and theBorrowers in respect of any sum due in the Original Currency from it to a Secured Party under any of the Note Purchase Documents shall, notwithstanding any judgment in any Other Currency, be discharged only to the extent that on the Business Day following receipt by such Secured Party of any sum adjudged to be so due in the Other Currency, such Secured Party may, in accordance with normal banking procedures, purchase the Original Currency with such Other Currency. If the amount of the Original Currency so purchased is less than the sum originally due to such Secured Party in the Original Currency, each of the Parent and the Borrowers agrees, as a separate obligation and notwithstanding the judgment, to indemnify such Secured Party against any loss, and, if the amount of the Original Currency so purchased exceeds the sum originally due to such Secured Party in the Original Currency, such Secured Party shall remit such excess to the Borrowers .

Section 12.15 Interest on Amounts

Except as may be expressly provided otherwise in this Agreement, all amounts owed by the Parent or the Borrowers to the Administrative Agent and to any of the Noteholders, which are not paid when due (whether at stated maturity, on demand, by acceleration or otherwise) shall bear interest (both before and after default and judgment), from the date on which such amount is due until such amount is paid in full, payable on demand, at a rate per annum equal at all times to the interest rate applicable at such time to the Notes .

Section 12.16 Severability

If any provision of this Agreement is determined to be illegal, invalid or unenforceable by an arbitrator or any court of competent jurisdiction, that provision will be severed from this Agreement and the remaining provisions shall remain unamended and in full force and effect.

Section 12.17 Survival

All representations and warranties made hereunder and in any other Note Purchase Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the Administrative Agent and each Holder, regardless of any investigation made by the Administrative Agent or any Holder or on their behalf and notwithstanding that the Administrative Agent or any Holder may have had notice or knowledge of any Default or Event of Default at the time of any purchase of a Note, and shall continue in full force and effect as long as any Note or any other Note Indebtedness shall remain unpaid or outstanding.

Section 12.18 Confidentiality

Each of the Administrative Agent and the Noteholders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (i) to its Directors, officers, employees and agents, including accountants, legal counsel and other advisors and representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (ii) to the extent requested by any regulatory authority, (iii) to the extent required by Applicable Laws or regulations or by any subpoena or similar legal process, (iv) to any other Party to this Agreement or any other Note Purchase Document, (v) in connection with the exercise of any remedies hereunder or under any other Note Purchase Document or any suit, action or proceeding relating to this Agreement or any other Note Purchase Document or the enforcement of rights hereunder or thereunder, (vi) subject to an agreement containing provisions substantially the same as those of this Section, (vii) with the consent of the Borrowers, or (viii) to the extent such Information (1) becomes publicly available other than as a result of a breach of this Section, or (2) becomes available to the Administrative Agent or any Noteholder on a non-confidential basis from a source other than a Borrower. For the purposes of this Section, “ Information ” means all information received from any Company Party relating to the Company Parties and their businesses, other than any such information that is available to the Administrative Agent or any Noteholder on a non-confidential basis prior to disclosure by a Company Party. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

Section 12.19 Patriot Act

Each Noteholder that is subject to the United States PATRIOT Act and the Administrative Agent (to the extent that it is subject to the United States Patriot Act), for itself and not on behalf of any Noteholder, hereby notifies the Company Parties that, pursuant to the requirements of the United States PATRIOT Act, it is required to obtain, verify and record information that identifies the Company Parties, which information includes the name and address of each Company Party and other information that will allow such Noteholder or the Administrative Agent, as applicable, to identify each Company Party in accordance with the United States PATRIOT Act. The Company Parties shall, promptly following a request by the Administrative Agent or any Noteholder, provide all documentation and other information that the Administrative Agent or such Noteholder requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money-laundering rules and regulations, including the United States PATRIOT Act.

Section 12.20 Ratification and Reaffirmation

Byexecution and delivery of this Agreement, the parties have amended and restated, in its entirety, the Original Note Purchase Agreement. This Agreement does not extinguish the outstanding Note Indebtedness and is not intended to be a substitution or novation thereof and the Liens securing the Note Indebtedness have not been impaired and are valid and continuing. The Borrowers acknowledge and confirm that they have no defenses, counterclaims or set-offs to the enforcement by the Administrative Agent or the Holders of the Note Indebtedness and the Administrative Agent and the Holders have fully performed all obligations to the Borrowers, the Parent or any other Company Party which the Administrative Agent and the Holders may have had or have on and as of the date hereof.

Section 12.21 Release

THE PARENT AND EACH BORROWER HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES AGENT AND EACH PURCHASER AND THEIR RESPECTIVE PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS (COLLECTIVELY, THE “RELEASED PARTIES”), FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS AGREEMENT IS EXECUTED, WHICH THE PARENT OR SUCH BORROWER MAY NOW OR HEREAFTER HAVE AGAINST THE RELEASED PARTIES, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING FROM ANY “LOANS”, INCLUDING ANY CONTRACTING FOR, CHARGING, TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST IN EXCESS OF THE HIGHEST LAWFUL RATE APPLICABLE, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE AGREEMENT OR OTHER NOTE PURCHASE DOCUMENTS, AND NEGOTIATION FOR AND EXECUTION OF THIS AGREEMENT.

Section 12.22 Representations of each Noteholder

Each Noteholder, severally and not jointly, hereby represents and warrants to the Parent and the Borrowers as of the First Closing Date as follows:

(1)

Such Person is acquiring the Notes and Bonus Shares (as defined in the Fee Letter) for its own account for investment purposes and not with a view toward, or for resale or transfer in connection with, the sale or distribution thereof within the meaning of the Securities Act of 1933, as amended (the “ Securities Act ”), that would be in violation of the Securities Act or any securities or “blue sky” laws of any state of the United States or other applicable law, and has no contract, agreement, undertaking or arrangement, and has no intention to enter into any contract, agreement, undertaking or arrangement to pledge such Notes or Bonus Shares or any part thereof.

(2)

Such Person has been advised by the Parent and Borrowers that (i) the Notes and Bonus Shares are being issued and sold by the Parent and Borrowers pursuant to an exemption from registration provided under Section 4(2) of the Securities Act and/or Regulation D under the Securities Act or pursuant to Regulation S under the Securities Act and neither the offer nor sale of any Notes or Bonus Shares has been registered under the Securities Act or any state or foreign securities or “blue sky” laws; (ii) the Bonus Shares are characterized as “restricted securities” under the Securities Act inasmuch as they are being acquired from the Parent and the Borrowers in a transaction not involving a public offering and that the undersigned must continue to bear the economic risk of the investment in the Notes and Bonus Shares unless subsequently registered under the Securities Act and all applicable state or foreign securities or “blue sky” laws or an exemption from such registration is available; (iii) it is not anticipated that there will be any public market for the Notes in the foreseeable future; (iv) when and if the Notes and Bonus Shares may be disposed of without registration in reliance on Rule 144 of the Securities Act (“ Rule 144 ”), such disposition can be made only in limited amounts in accordance with the terms and conditions of such rule; (v) if the Rule 144 exemption is not available, public offer or sale of any Notes and Bonus Shares without registration will require the availability of another exemption under the Securities Act; (vi) a restrictive legend in a form satisfactory to the Parent and Borrowers shall be placed on the Notes and the certificates representing the Bonus Shares; and (vii) a notation shall be made in the appropriate records of the transfer agent for the Notes and Bonus Shares indicating that the Notes and Bonus Shares are subject to restrictions on transfer.

(3)

Such Person is either (i) an “accredited investor” within the meaning of Rule 501(a)(1), (2), (3), (4) or (7) of the Securities Act or (ii) a non-U.S. person within the meaning of Regulation S under the Securities Act (which term shall include dealers or other professional fiduciaries in the United States acting on a discretionary basis for non-U.S. beneficial owners (other than an estate or trust)) and is purchasing the Notes and Bonus Shares outside the United States in reliance upon Regulation S under the Securities Act and, in either case, has such knowledge, skill and experience in business, financial and investment matters so that it is capable of evaluating the merits, risks and consequences of an investment in the Notes and Bonus Shares and is able to bear the economic risk of loss of such investment, including the complete loss of such investment.

(4)	Neither it nor its Affiliates or any Person acting on its or any of their behalf, has engaged, or will engage, in any form of general solicitation or general advertising (within the meaning of Rule 502(c) under the Securities Act) in connection with the Financing.

(5)

Such Person is not purchasing the Notes and Bonus Shares as a result of any advertisement, article, notice or other communication regarding the Notes and Bonus Shares published in any newspaper, magazine or similar media or broadcast over television or radio or presented at any seminar or, to such Purchaser's knowledge, any other general solicitation or general advertisement.

(6)	Such Person is not a Person named on a list published by OFAC or is a Person with whom dealings are prohibited under any OFAC Regulations;

(Signature pages follow herewith)

IN WITNESS WHEREOF , the Parties hereto have executed this Agreement on the date first written above.

BORROWERS:	AEMETIS ADVANCED FUELS KEYES, INC.

	By:	/s/ Eric A. McAfee, Chief Executive Officer


	KEYES FACILITY ACQUISITION CORP.

	By:	/s/ Eric A. McAfee
		Chief Executive Officer


PARENT:	AEMETIS, INC.

	By:	/s/ Eric A. McAfee
		Chief Executive Officer

[Signature Page to Amended and Restated Note Purchase Agreement]

ADMINISTRATIVE AGENT:	THIRD EYE CAPITAL CORPORATION

	By:	/s/ David G. Alexander
		Managing Director

	By:	/s/ Arif N. Bhalwani
		Managing Director

NOTEHOLDER:	SPROTT ASSET MANAGEMENT GP INC. , in its capacity as general partner of SPROTT ASSET MANAGEMENT L.P. , in its capacity as Manager of SPROTT PC TRUST

	By:	/s/ Kristi McTaggart
		Chief Compliance Officer


NOTEHOLDER:	THIRD EYE CAPITAL CREDIT OPPORTUNITIES S.ar.l, it its capacity as Managing General Partner of THIRD EYE CAPITAL CREDIT OPPORTUNITIES FUND – INSIGHT FUND

	By:	/s/ Richard Goddard
		Manager

	By:	/s/ Robert L. De Normandie
		Manager

[Signature Page to Amended and Restated Note Purchase Agreement]

EXHIBIT 10.3

EXECUTION COPY

AMENDED AND RESTATED GUARANTY

THIS AMENDED AND RESTATED GUARANTY (this “ Guaranty ”) is made as of July 6, 2012 by (i) AEMETIS, INC. (formerly known as AE Biofuels, Inc.) a Nevada corporation (“ Parent ”), (ii) BIOFUELS MARKETING, INC. , a Delaware corporation, (iii) AEMETIS BIOCHEMICALS INC. , a Nevada corporation, (iv) AEMETIS INTERNATIONAL, INC. (f/k/a International Biodiesel, Inc.), a Nevada corporation, (v) AEMETIS TECHNOLOGIES, INC. (f/k/a AE Zymetis, Inc.), a Delaware corporation, (vi) AEMETIS BIOFUELS, INC. (f/k/a AE Biofuels Technologies, Inc.), a Delaware corporation, (vii) AE ADVANCED FUELS, INC. , a Delaware corporation, (viii) AEMETIS ADVANCED FUELS, INC. , a Nevada corporation, (ix) AEMETIS AMERICAS, INC. (f/k/a American Ethanol, Inc.), a Nevada corporation, (x) ENERGY ENZYMES, INC. , a Delaware corporation, and (xi) AE BIOFUELS, INC. , a Delaware corporation (such parties collectively, the “ Guarantors ”, and each a “ Guarantor ”), in favor of THIRD EYE CAPITAL CORPORATION (“ Agent ”) for itself and the Noteholders party to the Amended and Restated Purchase Agreement defined below.

RECITALS

A. Pursuant to that certain Note Purchase Agreement dated October 18, 2010 among Aemetis Advanced Fuels Keyes, Inc. (formerly known as AE Advanced Fuels Keyes, Inc.), a Delaware corporation (“ AEAFK ”), Agent and the Noteholders party thereto (including all amendments and modifications thereto, the “ AEAFK Purchase Agreement ”), Guarantor executed and delivered that certain Guaranty dated as of October 18, 2010 (including all amendments and modifications thereto, the “ Original Guaranty ”) in favor of Agent for the benefit of Noteholders and agreed to guaranty the Obligations (as defined in the Original Guaranty) under the AEAFK Purchase Agreement as set forth in the Original Guaranty.

B. AEAFK, Keyes Facility Acquisition Corp., a Delaware corporation to be merged with and into Cilion, Inc., a Delaware corporation and to be known as Aemetis Facility Keyes, Inc . (“ Cilion Acquisition Corp . ”, together with AEAFK, the “ Borrowers ”), the Agent and the Noteholders from time to time party thereto are entering into an Amended and Restated Note Purchase Agreement (as defined below) pursuant to which the Noteholders will provide certain financial accommodations to the Borrowers as set forth in the Amended and Restated Purchase Agreement.

C. In consideration of the financing and other financial accommodations being made to the Borrowers pursuant to the Amended and Restated Purchase Agreement and as a condition to entering into the Amended and Restated Purchase Agreement, Guarantor has agreed to amend and restate the Original Guaranty and execute and deliver this Guaranty.

ACCORDINGLY , in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed that:

ARTICLE I

DEFINITIONS

When used in this Guaranty, capitalized terms shall have the meanings specified in the Amended and Restated Purchase Agreement and as follows:

Event of Default . “Event of Default” shall have the meaning specified in the Amended and Restated Purchase Agreement.

Guaranty . “Guaranty” shall mean this Guaranty, as the same shall be amended from time to time in accordance with the terms hereof.

Law . “Law” shall mean any federal, state, local or other law, rule, regulation or governmental requirement of any kind, and the rules, regulations, interpretations and orders promulgated thereunder.

Notes . “Notes” shall have the meaning given to it in the Amended and Restated Purchase Agreement.

Obligations . “Obligations” shall mean: (a) the outstanding principal of, and all interest on, the Notes; and (b) all debts, liabilities, obligations, covenants and agreements of Borrowers contained in the Amended and Restated Purchase Agreement; and (c) all debts, liabilities, obligations, covenants and agreements of Borrowers or any Subsidiary of Borrowers contained in the Note Purchase Documents, as any such documents may be amended in accordance with the terms thereof from time to time; and (d) all other liabilities and obligations of Borrowers or any Subsidiary of Borrowers to Agent or any Noteholder under or in connection with the Amended and Restated Purchase Agreement, the Notes or any other Note Purchase Documents, whether now existing or hereafter arising and any and all reasonable fees and expenses, including reasonable attorneys’ fees incurred in connection with enforcing any obligations of Agent or any Noteholder under any agreement described in (a) through (c) above.

Person . “Person” shall mean and include an individual, partnership, corporation, trust, unincorporated association and any unit, department or agency of government.

Amended and Restated Purchase Agreement . “Amended and Restated Purchase Agreement” shall mean the Amended and Restated Note Purchase Agreement of even date herewith as the same shall be amended from time to time in accordance with the terms thereof, by and among Borrowers, Parent, Agent and Noteholders, together with the Exhibits and Schedules attached thereto.

Note Purchase Documents . “Note Purchase Documents” shall have the meaning specified in the Amended and Restated Purchase Agreement.

ARTICLE II

THE GUARANTY

2.1 The Guaranty . Guarantor, for itself, its successors and assigns, hereby unconditionally and absolutely guarantees to Agent and Noteholders the full and complete payment and performance when due (whether at stated maturity, by acceleration or otherwise) of each of the Obligations. This is a guaranty of payment and performance and not of collection.

2.2 Waivers and Consents . (a) Guarantor acknowledges that the obligations undertaken herein involve the guaranty of obligations of a Person other than Guarantor and, in full recognition of that fact, Guarantor consents and agrees that Agent and Noteholders may, at any time and from time to time, without notice or demand, and without affecting the enforceability or continuing effectiveness hereof: (i) supplement, modify, amend, extend, renew, accelerate or otherwise change the time for payment or the other terms of the Obligations or any part thereof, including without limitation any increase or decrease of the principal amount thereof or the rate(s) of interest thereon; (ii) supplement, modify, amend or waive, or enter into or give any agreement, approval or consent with respect to, the Obligations or any part thereof, or any of the Note Purchase Documents or any additional security or guaranties, or any condition, covenant, default, remedy, right, representation or term thereof or thereunder; (iii) accept new or additional instruments, documents or agreements in exchange for or relative to any of the Note Purchase Documents or the Obligations or any part thereof; (iv) accept partial payments on the Obligations; (v) receive and hold additional security or guaranties for the Obligations or any part thereof; (vi) release, reconvey, terminate, waive, abandon, fail to perfect, subordinate, exchange, substitute, transfer and/or enforce any security or guaranties, and apply any security and direct the order or manner of sale thereof as Agent and Noteholders in their sole and absolute discretion may determine; (vii) release any Person from any personal liability with respect to the Obligations or any part thereof; (viii) settle, release on terms satisfactory to Agent and Noteholders or by operation of applicable Law or otherwise, liquidate or enforce any Obligations and any security or guaranty in any manner, consent to the transfer of any security and bid and purchase at any sale; and/or (ix) consent to the merger, change or any other restructuring or termination of the corporate existence of Borrowers or any other Person, and correspondingly restructure the Obligations, and any such merger, change, restructuring or termination shall not affect the liability of Guarantor or the continuing effectiveness hereof, or the enforceability hereof with respect to all or any part of the Obligations.

(b) Upon the occurrence and during the continuance of any Event of Default, Agent and/or any Noteholder may enforce this Guaranty independently of any other remedy, guaranty or security Agent or any Noteholder at any time may have or hold in connection with the Obligations, and it shall not be necessary for Agent or any Noteholder to marshal assets in favor of Borrowers or any Subsidiary of Borrowers, any other guarantor of the Obligations or any other Person or to proceed upon or against and/or exhaust any security or remedy before proceeding to enforce this Guaranty. Guarantor expressly waives any right to require Agent or any Noteholder to marshal assets in favor of Borrowers or any other Person or to proceed against Borrowers or any other guarantor of the Obligations or any collateral provided by any Person, and agrees that Agent or any Noteholder may proceed against any obligor and/or the collateral in such order as it shall determine in its sole and absolute discretion. Agent or any Noteholder may file a separate action or actions against Guarantor, whether action is brought or prosecuted with respect to any security or against any other Person, or whether any other Person is joined in any such action or actions. Guarantor agrees that Agent or any Noteholder and Borrowers may deal with each other in connection with the Obligations or otherwise, or alter any contracts or agreements now or hereafter existing between them, in any manner whatsoever, all without in any way altering or affecting the security of this Guaranty.

(c) Agent’s and each Noteholder’s rights hereunder shall be reinstated and revived, and the enforceability of this Guaranty shall continue, with respect to any amount at any time paid on account of the Obligations which thereafter shall be required to be restored or returned by Agent and/or each Noteholder upon the bankruptcy, insolvency or reorganization of any Person, all as though such amount had not been paid. The rights of Agent and Noteholders created or granted herein and the enforceability of this Guaranty shall remain effective at all times to guarantee the full amount of all the Obligations even though the Obligations, including any part thereof or any other security or guaranty therefor, may be or hereafter may become invalid or otherwise unenforceable as against Borrowers or any other guarantor of the Obligations and whether or not Borrowers or any other guarantor of the Obligations shall have any personal liability with respect thereto.

(d) Guarantor expressly waives any and all defenses now or hereafter arising or asserted by reason of: (i) any disability or other defense of Borrowers or any other guarantor for the Obligations with respect to the Obligations; (ii) the unenforceability or invalidity of any security for or guaranty of the Obligations or the lack of perfection or continuing perfection or failure of priority of any security for the Obligations; (iii) the cessation for any cause whatsoever of the liability of Borrowers or any other guarantor of the Obligations (other than by reason of the full payment and performance of all Obligations); (iv) any failure of Agent or any Noteholder to marshal assets in favor of Borrowers or any other Person; (v) any failure of Agent or any Noteholder to give notice of sale or other disposition of collateral to Borrowers or any other Person or any defect in any notice that may be given in connection with any sale or disposition of collateral; (vi) any failure of Agent or any Noteholder to comply with applicable Laws in connection with the sale or other disposition of any collateral or other security for any Obligation, including, without limitation, any failure of Agent or any Noteholder to conduct a commercially reasonable sale or other disposition of any collateral or other security for any Obligation; (vii) any act or omission of Agent or any Noteholder or others that directly or indirectly results in or aids the discharge or release of Borrowers or any other guarantor of the Obligations, or of any security or guaranty therefor by operation of Law or otherwise; (viii) any Law which provides that the obligation of a surety or guarantor must neither be larger in amount nor in other respects more burdensome than that of the principal or which reduces a surety’s or guarantor’s obligation in proportion to the principal obligation; (ix) any failure of Agent or any Noteholder to file or enforce a claim in any bankruptcy or other proceeding with respect to any Person; (x) the election by Agent or any Noteholder, in any bankruptcy proceeding of any Person, of the application or non-application of Section 1111(b)(2) of the United States Bankruptcy Code; (xi) any extension of credit or the grant of any lien under Section 364 of the United States Bankruptcy Code; (xii) any use of collateral under Section 363 of the United States Bankruptcy Code; (xiii) any agreement or stipulation with respect to the provision of adequate protection in any bankruptcy proceeding of any Person; (xiv) the avoidance of any lien or security interest in favor of Agent or any Noteholder for any reason; (xv) any bankruptcy, insolvency, reorganization, arrangement, readjustment of debt, liquidation or dissolution proceeding commenced by or against any Person, including without limitation any discharge of, or bar or stay against collecting, all or any of the Obligations (or any interest thereon) in or as a result of any such proceeding; or (xvi) any action taken by Agent or any Noteholder that is authorized by this Section or any other provision of any Note Purchase Document. Guarantor expressly waives all setoffs and counterclaims and all presentments, demands for payment or performance, notices of nonpayment or nonperformance, protests, notices of protest, notices of dishonor and all other notices or demands of any kind or nature whatsoever with respect to the Obligations, and all notices of acceptance of this Guaranty or of the existence, creation or incurrence of new or additional Obligations.

2.3 Condition of Borrowers . Guarantor represents and warrants to Agent and each Noteholder that it has established adequate means of obtaining from Borrowers, on a continuing basis, financial and other information pertaining to the businesses, operations and condition (financial and otherwise) of Borrowers and their assets and properties. Guarantor hereby expressly waives and relinquishes any duty on the part of Agent or any Noteholder (should any such duty exist) to disclose to Guarantor any matter, fact or thing related to the business, operations or condition (financial or otherwise) of Borrowers or their assets or properties, whether now known or hereafter known by Agent or any Noteholder during the life of this Guaranty. With respect to any of the Obligations, neither Agent nor any Noteholder need inquire into the powers of Borrowers or agents acting or purporting to act on its behalf, and all Obligations made or created in good faith reliance upon the professed exercise of such powers shall be guaranteed hereby.

2.4 Continuing Guaranty . This is a continuing guaranty and shall remain in full force and effect as to all of the Obligations until all amounts owing by Borrowers to Agent and each Noteholder on the Obligations shall have been paid in full.

2.5 Subrogation; Subordination . Guarantor expressly waives any claim for reimbursement, contribution, indemnity or subrogation which Guarantor may have against Borrowers as a guarantor of the Obligations and any other legal or equitable claim against Borrowers arising out of the payment of the Obligations by Guarantor or from the proceeds of any collateral for this Guaranty, until all amounts owing to Agent and each Noteholder under or in connection with the Obligations shall have been paid in full. In furtherance, and not in limitation, of the foregoing waiver, Guarantor hereby agrees that no payment by Guarantor pursuant to this Guaranty shall constitute Guarantor a creditor of Borrowers. Until all amounts owing to Agent and each Noteholder under or in connection with the Obligations shall have been paid in full, Guarantor shall not seek any reimbursement from Borrowers in respect of payments made by Guarantor in connection with this Guaranty, or in respect of amounts realized by Agent or any Noteholder in connection with any collateral for the Obligations, and Guarantor expressly waives any right to enforce any remedy that Agent or any Noteholder now has or hereafter may have against any other Person and waives the benefit of, or any right to participate in, any collateral now or hereafter held by Agent or any Noteholder. No claim which any Guarantor may have against any other guarantor of any of the Obligations or against Borrowers, to the extent not waived pursuant to this Section, shall be enforced nor any payment accepted until the Obligations are paid in full and all such payments are not subject to any right of recovery.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF GUARANTOR

Guarantor hereby represents and warrants to Agent and each Noteholder as follows:

3.1 Authorization . Guarantor is a corporation duly and validly organized and existing under the laws of the State of Nevada, has the corporate power to own its owned assets and properties and to carry on its business, and is duly licensed or qualified to do business in all jurisdictions in which failure to do so would have a material adverse effect on its business or financial condition. The making, execution, delivery and performance of this Guaranty, and compliance with its terms, have been duly authorized by all necessary corporate action of Guarantor.

3.2 Enforceability . This Guaranty is the legal, valid and binding obligation of Guarantor, enforceable against Guarantor in accordance with its terms.

3.3 Absence of Conflicting Obligations . The making, execution, delivery and performance of this Guaranty, and compliance with its terms, do not violate any existing provision of Law; the certificate of formation or operating agreement of Guarantor; or any agreement or instrument to which Guarantor is a party or by which it or any of its assets is bound.

3.4 Consideration for Guaranty . The Guarantor acknowledges and agrees with Agent and each Noteholder that but for the execution and delivery of this Guaranty by Guarantor, neither Agent nor any Noteholder would have entered into the Amended and Restated Purchase Agreement. The Guarantor acknowledges and agrees that the Amended and Restated Purchase Agreement and the transactions contemplated thereby will result in significant benefit to the Guarantor.

ARTICLE IV

COVENANTS OF THE GUARANTOR

4.1 Actions by Guarantor . Guarantor shall not take or permit any act, or omit to take any act, that would: (a) cause Borrowers to breach any of the Obligations; (b) impair the ability of Borrowers to perform any of the Obligations; or (c) cause an Event of Default under the Amended and Restated Purchase Agreement.

4.2 Reporting Requirements . Guarantor shall furnish, or cause to be furnished, to Agent or any Noteholder such information respecting the business, assets and financial condition of Guarantor as Agent or such Noteholder may reasonably request.

ARTICLE V

MISCELLANEOUS

5.1 Expenses and Attorneys’ Fees . Guarantor shall pay all reasonable fees and expenses incurred by Agent or any Noteholder, including the reasonable fees of counsel, in connection with the protection or enforcement of Agent’s or any Noteholder’s rights under this Guaranty, including without limitation the protection and enforcement of such rights in any bankruptcy, reorganization or insolvency proceeding involving Borrowers or Guarantor, both before and after judgment.

5.2 Revocation . This is a continuing guaranty and shall remain in full force and effect until Agent receives written notice of revocation signed by Guarantor. Upon revocation by written notice, this Guaranty shall continue in full force and effect as to all Obligations contracted for or incurred before revocation, and as to them Agent and each Noteholder shall have the rights provided by this Guaranty as if no revocation had occurred. Any renewal, extension, or increase in the interest rate(s) of any such Obligation, whether made before or after revocation, shall constitute an Obligation contracted for or incurred before revocation. Obligations contracted for or incurred before revocation shall also include credit extended after revocation pursuant to commitments made before revocation.

5.3 Assignability; Successors . The Guarantor’s rights and liabilities under this Guaranty are not assignable or delegable, in whole or in part, without the prior written consent of Agent. The provisions of this Guaranty shall be binding upon Guarantor, its successors and permitted assigns and shall inure to the benefit of Agent and Noteholders, and their respective successors and assigns.

5.4 Survival . All agreements, representations and warranties made herein or in any document delivered pursuant to this Guaranty shall survive the execution and delivery of this Guaranty and the delivery of any such document.

5.5 Governing Law . This Guaranty and the documents issued pursuant to this Guaranty shall be governed by, and construed and interpreted in accordance with, the Laws of the State of Delaware, without regard to conflict of laws principles thereof that would require the application of the laws of a jurisdiction other than Delaware.

5.6 Counterparts; Headings . This Guaranty may be executed in several counterparts, each of which shall be deemed an original, but such counterparts shall together constitute but one and the same agreement. The article and section headings in this Guaranty are inserted for convenience of reference only and shall not constitute a part of this Guaranty.

5.7 Notices . All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Guaranty shall be in writing and shall be deemed to have been given (i) when delivered personally to the recipient, (ii) sent to the recipient by reputable overnight courier service (charges prepaid), (iii) mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid or (iv) sent via facsimile or electronic transmission, in each case upon telephone or further electronic communication from the recipient acknowledging receipt (whether automatic or manual from recipient), as applicable. Such notices, demands and other communications shall be sent to Agent and to Guarantor at the address indicated below:

To Guarantor:	AE Biofuels, Inc. 20400 Stevens Creek Boulevard, Suite 700 Cupertino, California 95014 Attention: Eric McAfee, President

To Agent:	Third Eye Capital Corporation Brookfield Place, TD Canada Trust Tower 161 Bay Street, Suite 3820 Toronto, Ontario ON M5J 2S1 Canada Attention: Mr. Arif N. Bhalwani, Managing Director

With a copy to:	DLA Piper LLP (US) 500 8th Street, NW Washington, DC 20004 Attention: Eric Eisenberg

5.8 Amendment . No amendment of this Guaranty shall be effective unless in writing and signed by the Guarantor and Agent.

5.9 Severability . Any provision of this Guaranty which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Guaranty in such jurisdiction or affecting the validity or enforceability of any provision in any other jurisdiction.

5.10 Taxes . If any transfer or documentary taxes, assessments or charges levied by any governmental authority shall be payable by reason of the execution, delivery or recording of this Guaranty, Guarantor shall pay all such taxes, assessments and charges, including interest and penalties, and hereby indemnifies Agent and each Noteholder against any liability therefor.

5.11 Jurisdiction and Venue . Guarantor submits to the jurisdiction of any state or Federal court sitting in the State of Delaware in any legal suit, action or proceeding arising out of or relating to this Guaranty, (ii) agrees that all claims in respect of the action or proceeding may be heard or determined in any such court and (iii) agrees not to bring any action or proceeding arising out of or relating to this Guaranty in any other court. Each of the parties waives any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety or other security that might be required of any other party with respect thereto. Any party may make service on any other party by sending or delivering a copy of the process to the party to be served at the address and in the manner provided for the giving of notices in Section 5.7. Each party agrees that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by suit on the judgment or in any other manner provided by law. Nothing herein shall affect the right to serve process in any other manner permitted by law or shall limit the right of Agent or any Noteholder to bring proceedings against Guarantor in the courts of any other jurisdiction. To the extent provided by law, should Guarantor, after being so served, fail to appear or answer to any summons, complaint, process or papers so served within the number of days prescribed by law after the mailing thereof, Guarantor shall be deemed in default and an order and/or judgment may be entered by the court against Guarantor as demanded or prayed for in such summons, complaint, process or papers. The exclusive choice of forum for Guarantor set forth in this Section 5.11 shall not be deemed to preclude the enforcement by Agent or any Noteholder of any judgment obtained in any other forum or the taking by Agent or any Noteholder of any action to enforce the same in any other appropriate jurisdiction, and Guarantor hereby waive the right to collaterally attack any such judgment or action.

5.12 Waiver of Right to Jury Trial . GUARANTOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS GUARANTY OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF. GUARANTOR AGREES THAT THIS SECTION 5.12 IS A SPECIFIC AND MATERIAL ASPECT OF THIS AGREEMENT AND ACKNOWLEDGES THAT AGENT AND EACH NOTEHOLDER WOULD NOT ENTER INTO THE AMENDED AND RESTATED PURCHASE AGREEMENT IF THIS SECTION 5.12 WERE NOT PART OF THIS AGREEMENT.

5.13 Amendment and Restatement . This Guaranty amends and restates in its entirety the Original Guaranty. This Guaranty shall not be deemed to constitute a novation of the Original Guaranty or the obligations evidenced thereby.

EXECUTION COPY

IN WITNESS WHEREOF the undersigned has executed this Guaranty as of the day and year first above written.

		GUARANTORS:

		AEMETIS, INC. AEMETIS BIOCHEMICALS INC. AEMETIS INTERNATIONAL, INC. AEMETIS TECHNOLOGIES, INC. AEMETIS BIOFUELS, INC. AE ADVANCED FUELS, INC. AEMETIS ADVANCED FUELS, INC. AEMETIS AMERICAS, INC. ENERGY ENZYMES, INC. AE BIOFUELS, INC. By: /s/ Eric A. McAfee Name: Eric A. McAfee Title: Chief Executive Officer
		BIOFUELS MARKETING, INC. By: /s/ Eric A. McAfee Name: Eric A. McAfee Title: President

SIGNATURE PAGE TO A&R PARENT AND SUBSIDIARY GUARANTY

EXHIBIT 10.4

EXECUTION COPY

AMENDED AND RESTATED SECURITY AGREEMENT

THIS AMENDED AND RESTATED SECURITY AGREEMENT (this “ Agreement ”) is made as of the 6th day of July, 2012 by (i) AEMETIS ADVANCED FUELS KEYES, INC. (f/k/a AE Advanced Fuels Keyes, Inc.), a Delaware corporation (“ AEAFK ”), (ii) AEMETIS, Inc . (f/k/a AE Biofuels, Inc.), a Nevada corporation (“ Parent ”), (iii) BIOFUELS MARKETING, INC. , a Delaware corporation, (iv) AEMETIS BIOCHEMICALS INC. , a Nevada corporation, (v) AEMETIS INTERNATIONAL, INC. (f/k/a International Biodiesel, Inc.), a Nevada corporation, (vi) AEMETIS TECHNOLOGIES, INC. (f/k/a AE Zymetis, Inc.), a Delaware corporation, (vii) AEMETIS BIOFUELS, INC. (f/k/a AE Biofuels Technologies, Inc.), a Delaware corporation, (viii) AE ADVANCED FUELS, INC. , a Delaware corporation, (ix) AEMETIS ADVANCED FUELS, INC. , a Nevada corporation, (x) AEMETIS AMERICAS, INC. (f/k/a American Ethanol, Inc.), a Nevada corporation, (xi) ENERGY ENZYMES, INC. , a Delaware corporation, (xiii) KEYES FACILITY ACQUISITION CORP., a Delaware corporation to be merged with and into Cilion, Inc., a Delaware corporation and to be known as Aemetis Facility Keyes, Inc. (“ Cilion Acquisition Corp. ”, and together with AEAFK, the “Borrowers ”, and each a “Borrower”) , and (xii) AE BIOFUELS, INC. , a Delaware corporation (such parties collectively, the “ Debtors ”, and each a “ Debtor ”) having a mailing address at 20400 Stevens Creek Boulevard, Suite 700, Cupertino, California 95014, for the benefit and security of THIRD EYE CAPITAL CORPORATION , as Agent for the Noteholders are party to the Amended and Restated Purchase Agreement defined below (together with its successors and assigns, “ Secured Party ”).

RECITALS

A. Pursuant to (i) that certain Note and Warrant Purchase Agreement dated May 16, 2008 among Parent, Agent, and the Noteholders party thereto (including all amendments and modifications thereto, the “ Parent Purchase Agreement ”), Debtor executed and delivered that certain Security Agreement dated as of May 16, 2008 (including all amendments and modifications thereto, the “ Original Parent Security Agreement ”) in favor of Agent to secure all obligations under the Parent Purchase Agreement as set forth in the Original Parent Security Agreement and (ii) that certain Note Purchase Agreement dated October 18, 2010 among AEAFK, Agent, and the Noteholders party thereto (including all amendments and modifications thereto, the “ AEAFK Purchase Agreement ”), Debtor executed and delivered that certain Security Agreement dated as of October 18, 2010 (including all amendments and modifications thereto, the “ Original AEAFK Security Agreement ”, and together with the Original Parent Security Agreement, the “ Original Security Agreement ”) in favor of Agent to secure all obligations under the AEAFK Purchase Agreement as set forth in the Original AEAFK Security Agreement.

B. AEAFK, Cilion Acquisition Corp., the Agent and the Noteholders from time to time party thereto are entering into an Amended and Restated Note Purchase Agreement (as defined below) pursuant to which the Noteholders will provide certain financial accommodations to the Borrowers as set forth in the Amended and Restated Purchase Agreement.

C. In consideration of the financing and other financial accommodations being made to the Borrowers pursuant to the Amended and Restated Purchase Agreement and as a condition to entering into the Amended and Restated Purchase Agreement, each Debtor has agreed to amend and restate the Original Security Agreement and execute and deliver this Agreement.

ACCORDINGLY , in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed that:

ARTICLE I

CONSTRUCTION AND DEFINED TERMS

1.01 Defined Terms . Unless otherwise expressly stated in this Agreement: (a) capitalized terms which are not otherwise defined herein shall have the meanings assigned thereto in the Amended and Restated Purchase Agreement; and (b) “Account”, “Account Debtor”, “Chattel Paper”, “Commercial Tort Claims”, “Deposit Accounts”, “Documents”, “Equipment”, “Fixtures”, “General Intangibles”, “Goods”, “Instruments”, “Inventory”, “Investment Property”, “Letter of Credit Rights” and “Proceeds” shall have the respective meanings assigned to such terms, as of the date of this Agreement, in the Delaware Uniform Commercial Code (the “UCC”), as it may be revised from time to time; provided that if, and to the extent that, the Uniform Commercial Code of a jurisdiction other than Delaware governs the perfection, the effect of perfection or non-perfection, or the priority of a security interest created under this Agreement, then “UCC” shall refer to the Uniform Commercial Code of such other jurisdiction to the extent applicable to the perfection, the effect of perfection or non-perfection, or the priority of such security interest.

“Amended and Restated Purchase Agreement” means the Amended and Restated Note Purchase Agreement of even date herewith as the same shall be amended from time to time in accordance with the terms thereof, by and among Debtors, Secured Party and the Noteholders from time to time party thereto, together with the Exhibits and Schedules attached thereto.

"Secured Obligations" means all present and future obligations and liabilities (whether actual or contingent, whether owed jointly or severally or alone or in any other capacity whatsoever) of Debtor and each Affiliate or Subsidiary of Debtor (or any of them) under or pursuant to each or any of the Note Purchase Documents (each as amended or restated from time to time) together with all costs, charges and expenses incurred by Secured Party in connection with the protection, preservation or enforcement of its respective rights under the Amended and Restated Purchase Agreement, the Notes and any other Note Purchase Documents or any other document evidencing or securing any such liabilities.

ARTICLE II

SECURITY INTEREST; PERFECTION

2.01 Security Interest . To secure the full and timely payment, performance and satisfaction of the Secured Obligations, each Debtor does hereby pledge, assign, transfer and deliver to Secured Party and does hereby grant to Secured Party a continuing and unconditional security interest in and to the property of such Debtor, whether now existing or hereafter acquired, and wherever now or hereafter located, and the products and proceeds therefrom (collectively, the “ Collateral ”), described as follows:

(a) All Accounts, and all Goods, repossessed from or returned by an Account Debtor, whose sale, lease, or other disposition by Debtor have given rise to Accounts;

(b) All Inventory; all Goods, other than Inventory;

(d) All Chattel Paper, Instruments, Documents, Deposit Accounts, General Intangibles and Investment Property;

(e) All Commercial Tort Claims identified on Schedule 2.01 attached hereto and all Letter of Credit Rights;

(f) All books and records (including, without limitation, customer lists, credit files, computer programs, print-outs and other computer materials and records) of such Debtor pertaining to any of the foregoing; and

(g) All products and Proceeds of any of the foregoing, including, without limitation, all insurance policies and proceeds insuring the foregoing property or any part thereof, including unearned premiums.

2.02 Perfection by Filing .

(a) Promptly upon Secured Party’s request from time to time, each Debtor shall deliver to Secured Party any financing statement or other document, and shall use commercially reasonable efforts to cause any third party to execute and deliver to Secured Party any other document (including financing statement termination statements), reasonably requested by Secured Party to perfect the security interests created under this Agreement and to establish, maintain, and continue the first priority of the security interests created under this Agreement.

(b) Secured Party shall not be required to obtain Debtors’ consent or authorization for Secured Party to file, and Secured Party shall be entitled to file, any financing statement, amendment, or other document that Secured Party may be authorized to file in accordance with the terms of the UCC, including any financing statement, amendment, or other document that Secured Party may be authorized to file based on Debtors having executed this Agreement or based on Debtors having executed any other security agreement.

(c) Any financing statement or other record filed to perfect the security interests evidenced by this Agreement may, at Secured Party’s option, describe or indicate the Collateral in the manner that the Collateral is described in this Agreement, or as all assets of Debtors, or as all personal property of Debtors, or by any other description or indication of the Collateral that may be sufficient for a financing statement under the UCC.

2.03 Perfection by Possession . If Collateral is of a type as to which it is necessary, desirable, or advisable, as determined by Secured Party, for Secured Party to take possession of such Collateral in order to protect, perfect, or maintain the first priority of Secured Party’s security interest or other lien in such (or any other) Collateral, then, promptly upon Secured Party’s request from time to time and with respect to Collateral, each Debtor shall deliver such Collateral to Secured Party.

2.04 Deposit Accounts . (a) Schedule 2.04 hereto accurately sets forth, as of the date of this Agreement, each Deposit Account maintained by each Debtor and the name of the respective bank with which such Deposit Account is maintained. For each Deposit Account Debtor shall cause the bank with which such Deposit Account is maintained to execute and deliver to the Secured Party a "control agreement" in form and substance satisfactory to the Secured Party. If any bank with which a Deposit Account is maintained refuses to, or for any other reason does not, enter into such a "control agreement", then the Debtors shall promptly (and in any event within 30 days of the date of this Agreement or, if later, 30 days after the establishment of such account) close the respective Deposit Account and transfer all balances therein to another Deposit Account meeting the requirements of this Section 2.04.

(b) After the date of this Agreement, Debtors shall not establish any new demand, time, savings, passbook or similar account, except for Deposit Accounts established and maintained with banks and meeting the requirements of the preceding clause (a). Within 30 days after any such Deposit Account is established, the appropriate "control agreement" shall be entered into in accordance with the requirements of preceding clause (a), and Debtors shall furnish to the Secured Party a supplement to Schedule 2.04 hereto containing the relevant information with respect to the respective Deposit Account and the bank with which same is established.

2.05 Actions by Secured Party . None of the following shall affect the Obligations of Debtors to Secured Party under this Agreement or Secured Party's rights with respect to the Collateral.

(a) Acceptance or retention by Secured Party of other property or interests in property as security for the Obligations;

(b) Release of all or any part of the Collateral;

(d) Failure by Secured Party to resort to other security or pursue Debtors or any other obligor liable for any of the Obligations before resorting to the Collateral.

ARTICLE III

WARRANTIES AND COVENANTS

3.01 Debtor’s Name and Identification Number . The name of each Debtor set forth on the first page and the signature page of this Agreement is such Debtor’s correct and complete legal name. The street address for each Debtor in this Agreement is such Debtor’s mailing address, and the facsimile number for each Debtor set forth in this Agreement is such Debtor’s facsimile number. Debtors shall not change Debtors’ name or corporate structure or change the location of Debtors’ chief executive office without at least thirty (30) days’ prior written notice to Secured Party.

3.02 Organization, Power . Each Debtor (a) is a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation, (b) has the corporate power and authority to own such Debtor’s properties and assets and to carry on such Debtor’s business as now conducted, (c) has the corporate power and authority to execute, deliver and perform this Agreement and the other Note Purchase Documents and each agreement or instrument contemplated thereby to which such Debtor is or will be a party, and (d) is qualified to do business in every jurisdiction where such qualification is necessary except where the failure to so qualify would not have a materially adverse effect on such Debtor’s business, properties, operations, prospects or condition, financial or otherwise, and would not impair such Debtor’s ability to perform such Debtor’s obligations under or in connection with the Note Purchase Documents.

3.03 Ownership of Property; Priority of Security Interest . Each Debtor is the sole owner of the Collateral free from any lien, security interest or encumbrance of any kind (other than Permitted Lien) and such Debtor will not sell, lease or grant any further security interest in the Collateral or any part thereof, and will not part with possession of the same, except in the usual and ordinary course of such Debtor’s business or as otherwise permitted under the Amended and Restated Purchase Agreement. Debtors will not use or permit the Collateral to be used in violation of any law or ordinance and Debtors will procure and maintain, or cause to be procured and maintained, insurance on the Collateral for the full duration of this Agreement against reasonable risks of loss, damage and destruction in accordance with the provisions of the Amended and Restated Purchase Agreement.

3.04 Location of Collateral . The Collateral is located at the locations listed on Exhibit A (the “ Designated Locations ”). Each Debtor’s chief executive office is located at the address listed on the first page of this Agreement.

3.05 Further Assurances . Each Debtor shall, at Secured Party's request, at any time and from time to time, deliver to Secured Party such financing statements and execute and/or deliver such other documents and instruments and do such acts as Secured Party may deem reasonably necessary or desirable in order to establish and maintain valid, attached and perfected security interests in the Collateral in favor of Secured Party, free and clear of all liens, claims and rights of third parties whatsoever. Each Debtor hereby irrevocably appoints any officer of Secured Party (designated by Secured Party for such purpose) its attorney-in-fact, in such Debtor's name, place and stead, to execute such financing statements and other documents and, upon the occurrence and during the continuation of an Event of Default, to do such other acts as Secured Party may reasonably require to perfect and preserve Secured Party's security interest in, and to enforce such interests in the Collateral, hereby ratifying and confirming all that said attorney-in-fact may do or cause to be done by virtue hereof. If any of the Collateral includes any vehicles with an aggregate market value in excess of $25,000 and having a certificate of title, each Debtor shall deliver to Secured Party the original certificate of title for each such vehicle or vehicles, together with such applications and other documents which Secured Party may request in order to have Secured Party's security interest noted on the certificate of title for such vehicle and to otherwise perfect Secured Party's security interest therein.

3.06 Identity; Locations . Debtors shall not change Debtors’ name or corporate structure or change the location of Debtors’ chief executive office without at least thirty (30) days’ prior written notice to the Secured Party.

3.07 Liens . Debtors shall not create, incur, assume or suffer to exist any liens or encumbrances upon the Collateral other than Permitted Liens.

3.08 Covenants under Amended and Restated Purchase Agreement . As long as any Secured Obligations are outstanding, each Debtor shall comply with the covenants and agreements to which it or the Collateral are subject under the terms of this Agreement and the Amended and Restated Purchase Agreement.

ARTICLE IV

EVENT OF DEFAULT; ENFORCEMENT OF SECURITY INTEREST

4.01 Rights and Remedies . The occurrence of an "Event of Default" under the Amended and Restated Purchase Agreement shall constitute an Event of Default under this Agreement. Upon the occurrence and continuation of an Event of Default under the Amended and Restated Purchase Agreement, Secured Party may exercise, from time to time, any rights and remedies available to it under the UCC and any other applicable law in addition to, and not in lieu of, any rights and remedies expressly granted in this Agreement, the Amended and Restated Purchase Agreement or in any other Note Purchase Documents and may, without limitation, take possession of any or all of the Collateral (in addition to Collateral of which it already has possession) without notice, demand or legal process of any kind, wherever it may be found, and for that purpose may pursue the same wherever it may be found, and may enter into each Debtor's premises where any of the Collateral may be or be supposed to be, and search for, take possession of, remove, keep and store any of the Collateral until the same shall be sold or otherwise disposed of, and Secured Party shall have the right to store the same at each Debtor's premises without cost to Secured Party. At Secured Party’s request, each Debtor will, at such Debtor’s expense, assemble the Collateral and make it available to Secured Party at a place or places to be designated by Secured Party which is reasonably convenient to Secured Party and such Debtor.

4.02 Disposition of Collateral .

(a) Upon the occurrence and continuation of an Event of Default under the Amended and Restated Purchase Agreement, Secured Party may sell, lease, license, or otherwise dispose of any or all of the Collateral in its present condition or following any commercially reasonable preparation or processing. Each Debtor agrees that 10 days notice from Secured Party of any proposed sale or other disposition of Collateral by Secured Party shall be reasonable.

(b) Upon the occurrence and continuation of an Event of Default under the Amended and Restated Purchase Agreement, Secured Party may dispose of Collateral by public or private proceedings, by one or more contracts, as a unit or in parcels, and at any time and place and on any terms.

(c) Upon the occurrence and continuation of an Event of Default under the Amended and Restated Purchase Agreement, Secured Party may purchase Collateral (1) at a public disposition or (2) if the Collateral is of a kind that is customarily sold on a recognized market or the subject of widely distributed standard price quotations, at a private disposition at standard market prices for such Collateral.

4.03 Power of Attorney . Each Debtor hereby appoints Secured Party as such Debtor’s attorney-in-fact, with power of substitution, which appointment is irrevocable and coupled with an interest, to do each of the following in the name of such Debtor or in the name of Secured Party or otherwise, for the use and benefit of Secured Party, but at the cost and expense of such Debtor, and with or without notice to such Debtor upon the occurrence and during the continuation of an Event of Default under the Amended and Restated Purchase Agreement in accordance with the terms thereof, to endorse such Debtor's name to checks, drafts, instruments and other items of payment, and/or proceeds of the Collateral. The foregoing power of attorney is in addition to any other power of attorney that may be granted to Secured Party under any Note Purchase Document.

ARTICLE V

GENERAL PROVISIONS

5.01 Remedies Cumulative . No failure or delay on the part of Secured Party in exercising any right, power or privilege hereunder or under any other Note Purchase Document and no course of dealing between Debtors, Debtors or other Person and Secured Party shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or under any other Note Purchase Document preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder or thereunder. The rights and remedies provided in this Agreement are cumulative and not exclusive of any rights or remedies which Secured Party would otherwise have and may be exercised simultaneously. No notice to or demand on Debtors in any case shall entitle Debtors, Debtors or any other Person to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of Secured Party to any other or further action in any circumstances without notice or demand. EACH DEBTOR WAIVES EVERY DEFENSE, CAUSE OF ACTION, COUNTERCLAIM OR SETOFF WHICH SUCH DEBTOR MAY NOW HAVE OR HEREAFTER MAY HAVE TO ANY ACTION BY SECURED PARTY IN ENFORCING THIS AGREEMENT OR THE COLLATERAL AND RATIFIES AND CONFIRMS WHATEVER SECURED PARTY MAY DO PURSUANT TO THE TERMS HEREOF AND WITH RESPECT TO THE COLLATERAL AND AGREES THAT SECURED PARTY SHALL NOT BE LIABLE FOR ANY ERROR OF JUDGMENT OR MISTAKES OF FACT OR LAW.

5.02 Notices . All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given (i) when delivered personally to the recipient, (ii) sent to the recipient by reputable overnight courier service (charges prepaid), (iii) mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid or (iv) sent via facsimile or electronic transmission, in each case upon telephone or further electronic communication from the recipient acknowledging receipt (whether automatic or manual from recipient), as applicable. Such notices, demands and other communications shall be sent to Secured Party and Debtors at the address indicated below:

To Debtors:	Aemetis Advanced Fuels Keyes, Inc. 20400 Stevens Creek Boulevard, Suite 700 Cupertino, California 95014 Attention: Eric A. McAfee - President

To Secured Party:	Third Eye Capital Corporation Brookfield Place, TD Canada Trust Tower 161 Bay Street, Suite 3820 Toronto, Ontario ON M5J 2S1 Canada Attention: Mr. Arif N. Bhalwani, Managing Director

With a copy to:	DLA Piper LLP (US) 500 8th Street, NW Washington, DC 20004 Attention: Eric Eisenberg

5.03 Term . The term of this Agreement shall commence with the date of this Agreement and shall continue in full force and effect and be binding upon each Debtor until all Secured Obligations shall have been fully paid and satisfied and Secured Party shall have given Debtors written notice of the termination of this Agreement (excluding provisions that by their terms survive termination of other provisions of this Agreement or survive the termination of the security interest created under this Agreement). Secured Party shall not be obligated to give Debtors written notice of termination of this Agreement, or to terminate any financing statements or other liens, until all Secured Obligations shall have been fully paid and satisfied and there is no commitment on the part of Secured Party or any purchaser to make an advance, incur an obligation or otherwise give value, and Debtors shall have given Secured Party a written demand requesting the termination of this Agreement and any financing statements at which time Secured Party shall execute and deliver such documents, at Debtors’ expense, as are necessary to release Secured Party’s liens in the Collateral. Notwithstanding anything to the contrary in this Agreement or any other Note Purchase Documents, this Agreement shall continue to be effective or be reinstated, as the case may be, if at any time any amount received by Secured Party in respect of the Secured Obligations is rescinded or must otherwise be restored or returned by Secured Party upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Debtors or upon the appointment of any intervenor or conservator of, or trustee or similar official for, Debtors or any substantial part of Debtors’ assets, or otherwise, all as though such payments had not been made.

5.04 Further Assurances . Each Debtor shall execute and deliver to Secured Party such further assurances and take such other further actions as Secured Party may from time to time reasonably request to further the intent and purpose of this Agreement and the other Note Purchase Documents and to maintain and protect the rights and remedies intended to be created in favor of Secured Party under this Agreement and the other Note Purchase Documents.

5.05 Amendments, Waivers and Consents; Successors and Assigns . This Agreement may not be amended, modified, changed, waived, discharged or terminated, nor shall any consent be given, unless such amendment, modification, change, waiver, discharge, termination or consent is in writing signed by Secured Party and Debtors. This Agreement shall create a continuing security interest in the Collateral and shall (i) remain in full force and effect until the Secured Obligations have been fully paid and satisfied and this Agreement has been terminated, (ii) be binding upon each Debtor and each Debtor’s successors and assigns, and (iii) inure, together with the rights and remedies of Secured Party hereunder, to the benefit of Secured Party and Secured Party’s successors, transferees and assigns. This Agreement may not be assigned by Debtors without the prior written consent of Secured Party.

5.06 Entire Agreement . This Agreement is the complete and exclusive expression of all the terms of the matters expressed herein, and all prior agreements, statements, and representations, whether written or oral, which relate hereto in any way are hereby superseded and shall be given no force and effect. No promise, inducement, or representation has been made to Debtors which relates in any way to the matters expressed in this Agreement and in any other Note Purchase Documents with this Agreement, other than what is expressly stated herein and in such Note Purchase Documents.

5.07 Amendment and Restatement . This Agreement amends and restates in its entirety the Original Security Agreement. This Agreement shall not be deemed to constitute a novation of the Original Security Agreement or the obligations evidenced thereby.

5.08 No Strict Construction . The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event of any ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement.

5.09 Indemnification . In addition to and not in limitation of any indemnification obligations of Debtors under the Amended and Restated Purchase Agreement, each Debtor agrees to indemnify the Secured Party from and against any and all claims, losses and liabilities arising out of or resulting from this Agreement (including, without limitation, enforcement of this Agreement), including without limitation any past, present or future violation of any Environmental Laws, relating to or affecting such Debtor’s properties or such Debtor’s operations, whether or not caused by or within the control of such Debtor, except claims, losses or liabilities resulting from the gross negligence or willful misconduct of the Secured Party.

5.10 Governing Law . This Agreement and all related instruments and documents and the rights and obligations of the parties hereunder and thereunder shall, in all respects, be governed by, and construed in accordance with, the internal laws of the State of Delaware, without regard to conflict of laws principles thereof that would require the application of the laws of a jurisdiction other than Delaware.

5.11 JURISDICTION; VENUE . Debtor submits to the jurisdiction of any state or Federal court sitting in the State of Delaware in any legal suit, action or proceeding arising out of or relating to this Agreement, (ii) agrees that all claims in respect of the action or proceeding may be heard or determined in any such court and (iii) agrees not to bring any action or proceeding arising out of or relating to this Agreement in any other court. Each of the parties waives any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety or other security that might be required of any other party with respect thereto. Any party may make service on any other party by sending or delivering a copy of the process to the party to be served at the address and in the manner provided for the giving of notices in Section 5.02. Each party agrees that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by suit on the judgment or in any other manner provided by law. Nothing herein shall affect the right to serve process in any other manner permitted by law or shall limit the right of the Secured Party to bring proceedings against Debtors in the courts of any other jurisdiction. To the extent provided by law, should Debtors, after being so served, fail to appear or answer to any summons, complaint, process or papers so served within the number of days prescribed by law after the mailing thereof, Debtors shall be deemed in default and an order and/or judgment may be entered by the court against Debtors as demanded or prayed for in such summons, complaint, process or papers. The exclusive choice of forum for Debtors set forth in this Section 5.11 shall not be deemed to preclude the enforcement by Secured Party of any judgment obtained in any other forum or the taking by the Secured Party of any action to enforce the same in any other appropriate jurisdiction, and Debtors hereby waive the right to collaterally attack any such judgment or action.

5.12 Severability . Any provision of this Agreement, or of any other Note Purchase Document, that is prohibited by, or unenforceable under, the laws of any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability, without invalidating the remaining provisions of this Agreement, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

5.13 Counterparts . This Agreement may be executed in counterparts and each shall be effective as an original, and a photocopy, facsimile or telecopy of this executed Agreement shall be effective as an original. In making proof of this Agreement, it shall not be necessary to produce more than one counterpart, photocopy, facsimile, or telecopy of this Agreement.

5.14 Miscellaneous . Terms used in this Agreement shall be applicable to the singular and plural, and references to gender shall include all genders.

5.15 WAIVER OF JURY TRIAL . DEBTORS AND SECURED PARTY MUTUALLY WAIVE ALL RIGHT TO TRIAL BY JURY OF ALL CLAIMS OF ANY KIND ARISING UNDER THIS AGREEMENT OR THE OTHER NOTE PURCHASE DOCUMENTS. DEBTORS AND SECURED PARTY ACKNOWLEDGE THAT THIS IS A WAIVER OF A LEGAL RIGHT AND THAT EACH DEBTOR AND SECURED PARTY EACH MAKE THIS WAIVER VOLUNTARILY AND KNOWINGLY AFTER CONSULTATION WITH COUNSEL OF ITS CHOICE. DEBTORS AND SECURED PARTY AGREE THAT ALL SUCH CLAIMS SHALL BE TRIED BEFORE A JUDGE OF A COURT HAVING JURISDICTION, WITHOUT A JURY.

[SIGNATURE PAGE FOLLOWS]

EXECUTION COPY

IN WITNESS WHEREOF, and intending to be legally bound hereby, Debtors and Secured Party execute this Agreement as of the date first above written.

		DEBTORS:

		AEMETIS, INC. AEMETIS ADVANCED FUELS KEYES, INC. AEMETIS BIOCHEMICALS INC. AEMETIS INTERNATIONAL, INC. AEMETIS TECHNOLOGIES, INC. AEMETIS BIOFUELS, INC. AE ADVANCED FUELS, INC. AEMETIS ADVANCED FUELS, INC. AEMETIS AMERICAS, INC. ENERGY ENZYMES, INC. AE BIOFUELS, INC. By: /s/ Eric A. McAfee Name: Eric A. McAfee Title: Chief Executive Officer
		BIOFUELS MARKETING, INC. By: /s/ Eric A. McAfee Name: Eric A. McAfee Title: President
		KEYES FACILITY ACQUISITION CORP., predecessor in interest to Cilion, Inc. pursuant to the Acquisition and to be known as Aemetis Facility Keyes, Inc. after the consummation of the Acquisition By: /s/ Eric A. McAfee Name: Eric A. McAfee Title: Chief Executive Officer

signature page to amended and restated security agreement – Borrower and affiliates

SECURED PARTY:

THIRD EYE CAPITAL CORPORATION

By: /s/ David G. Alexander

Name: David G. Alexander

Title: Managing Director

signature page to amended and restated security agreement – Borrower AND AFFILIATES

EXHIBIT 10.5

AEMETIS, INC.

INVESTORS’ RIGHTS AGREEMENT

July 6, 2012

TABLE OF CONTENTS

			PAGE
1.	Registration Rights		3
	1.1	Definitions	3
	1.2	Company Registration	4
	1.3	Demand Registration	5
	1.4	Obligations of the Company	6
	1.5	Information from Holder	8
	1.6	Expenses of Registration	8
	1.7	Delay of Registration	8
	1.8	Indemnification	8
	1.9	Assignment of Registration Rights	10
	1.10	“Market Stand-Off” Agreement	11
	1.11	Termination of Registration Rights	12

2.	Right of First Refusal		12

3.	Miscellaneous		13
	3.1	Successors and Assigns	13
	3.2	Governing Law	13
	3.3	Counterparts	13
	3.4	Titles and Subtitles	13
	3.5	Notices	13
	3.6	Expenses	14
	3.7	Entire Agreement; Amendments and Waivers	14
	3.8	Severability	14
	3.9	Aggregation of Stock	14

INVESTORS’ RIGHTS AGREEMENT

THIS INVESTORS’ RIGHTS AGREEMENT (the “Agreement”) is made as of the 6 th day of July, 2012, by and among Aemetis, Inc., a Nevada corporation (the “Company”) and the investors listed on Schedule A hereto, each of which is herein referred to as an “Investor.”

RECITALS

WHEREAS , the Investors listed on Schedule A are parties to the Amended and Restated Note Purchase Agreement of even date herewith by and among the Company and such Investors (the “Note Purchase Agreement”), and in connection therewith, the Company is issuing 15,000,000 shares (the “Shares”) of common stock of the Company (the “Common Stock”); and

WHEREAS , the Note Purchase Agreement provides that the execution and delivery of this Agreement by the Company and the Investors is a condition to the closing of the Investors’ obligations under the Note Purchase Agreement.

NOW, THEREFORE , in consideration of the mutual promises and covenants set forth herein, the parties hereto agree as follows:

1. Registration Rights . The Company covenants and agrees as follows:

1.1 Definitions . For purposes of this Section 1:

(a) The term “Act” means the Securities Act of 1933, as amended.

(c) The term “Holder” means any person owning or having the right to acquire Registrable Securities or any assignee thereof in accordance with Section 1.9 hereof.

(e) The term “1934 Act” means the Securities Exchange Act of 1934, as amended.

(f) The terms “register,” “registered,” and “registration” refer to a registration effected by preparing and filing a registration statement or similar document in compliance with the Act, and the declaration or ordering of effectiveness of such registration statement or document.

(g) The term “Registrable Securities” means (i) the Shares, (ii) any other shares of Common Stock held by the Investors and (iii) any capital stock of the Company issued or issuable as a dividend or other distribution with respect to, or in exchange for, or in replacement of, the Shares or such other shares of Common Stock held by the Investors, whether by stock split, recapitalization, merger, consolidation or otherwise, until the registration rights granted by this Agreement with respect to the Shares and such other shares have terminated in accordance with this Agreement.

(h) The term “Rule 144” shall mean Rule 144 under the Act.

(i) The term “SEC” shall mean the Securities and Exchange Commission.

1.2 Company Registration .

(a) If (but without any obligation to do so) the Company proposes to register any of its stock or other securities under the Act in connection with the public offering of such securities (other than a registration relating solely to the sale of securities of participants in a Company employee benefit plan, a registration covering only securities proposed to be issued in exchange for securities or assets of another corporation, or a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities that are also being registered), the Company shall, at such time, promptly give each Holder written notice of such registration. Upon the written request of each Holder given within twenty (20) days after such notice is delivered to such Holder in accordance with Section 3.5, the Company shall, subject to the provisions of Section 1.2(c), use best efforts to cause to be registered under the Act all of the Registrable Securities that each such Holder requests to be registered.

(b) Right to Terminate Registration . The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 1.2 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration. The expenses of such withdrawn registration shall be borne by the Company in accordance with Section 1.6 hereof.

(c) Underwriting Requirements . In connection with any offering involving an underwriting of shares of the Company’s capital stock, the Company shall not be required under this Section 1.2 to include any of the Holders’ securities in such underwriting unless they accept the terms of the underwriting as agreed upon between the Company and the underwriters selected by the Company (or by other persons entitled to select the underwriters) and enter into an underwriting agreement in customary form with such underwriters, and then, subject to the remaining provisions of this Section 1.2(c), only in such quantity as the underwriters determine in their sole discretion will not jeopardize the success of the offering by the Company. If the total amount of securities, including Registrable Securities, if the managing underwriters advise the Company in writing that in their opinion the number of securities requested to be included in such registration exceeds the number which can be sold in such offering without adversely affecting the marketability of the offering, the Company will include in such registration only the amount of securities which the managing underwriters have advised can be sold, and will allocate such amount, first , the amount of securities the Company proposes to sell and second , pro rata among the selling Holders based on the number of Registrable Securities held by all selling Holders or in such other proportions as shall mutually be agreed to by all such selling Holders. For purposes of the preceding sentence concerning apportionment, for any selling stockholder that is a Holder of Registrable Securities and that is a venture capital fund, partnership or corporation, the affiliated venture capital funds, partners, retired partners and stockholders of such Holder, or the estates and family members of any such partners and retired partners and any trusts for the benefit of any of the foregoing persons shall be deemed to be a single “selling Holder,” and any pro rata reduction with respect to such “selling Holder” shall be based upon the aggregate amount of Registrable Securities owned by all such related entities and individuals.

1.3 Demand Registration . In case the Company shall receive from the Holders of at least twenty-five percent (25%) of the Registrable Securities (for purposes of this Section 1.3, the “Initiating Holders”) a written request or requests that the Company effect a registration on Form S-3 and any related qualification or compliance with respect to all or a part of the Registrable Securities owned by such Holder or Holders, the Company shall:

(a) promptly give written notice of the proposed registration, and any related qualification or compliance, to all other Holders; and

(b) prepare and file with the SEC a registration statement with respect to such Registrable Securities within ninety (90) days after any written request for registration, and use its best efforts to cause such registration statement to become effective (provided, that before filing a registration statement or prospectus or any amendments or supplements thereto, the Company will furnish to counsel selected by the Holders copies of all such documents proposed to be filed, which documents will be subject to review and approval of such counsel), use its best efforts to file all such qualifications as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holders’ Registrable Securities as are specified in such request (and to avoid the issuance of (or if issued, obtain the withdrawal of) any order suspending the effectiveness of a registration statement, or the lifting of any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction as soon as possible), and, together with all or such portion of the Registrable Securities of any other Holders joining in such request as are specified in a written request given within fifteen (15) days after such notice from the Company is delivered to such Holder, provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance, pursuant to this section 1.3:

(i) if Form S-3 is not available for such offering by the Holders;

(iii) if the Company shall furnish to Holders requesting a registration statement pursuant to this Section 1.3 a certificate signed by the Company’s Chief Executive Officer or Chairman of the Board stating that in the good faith judgment of the Board of Directors of the Company, it would be materially detrimental to the Company and its stockholders for such registration statement to be effected at such time, in which event the Company shall have the right to defer such filing for a period of not more than ninety (90) days after receipt of the request of the Initiating Holders, provided that such right shall be exercised by the Company not more than once in any twelve (12)-month period;

(iv) if the Company has, within the six (6) month period preceding the date of such request, already effected one registration on Form S-3 for the Holders pursuant to this Section 1.3;

(v) if the Company has already effected four registrations on Form S-3 for the Holders pursuant to this Section 1.3; or

(c) If the Initiating Holders intend to distribute the Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to this Section 1.3 and the Company shall include such information in the written notice referred to in Section 1.3(a). The provisions of Section 1.2(b) shall be applicable to such request (with the substitution of Section 1.3 for references to Section 1.2).

1.4 Obligations of the Company . Whenever required under this Section 1 to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible:

(f) cause all such Registrable Securities registered pursuant to this Section 1 to be listed on a national exchange or trading system and on each securities exchange and trading system on which similar securities issued by the Company are then listed;

(j) Notwithstanding the provisions of this Section 1, the Company shall be entitled to postpone or suspend, for a reasonable period of time (and in no event in excess of 90 days), the filing, effectiveness or use of, or trading under, any registration statement if the Company shall determine that any such filing or the sale of any securities pursuant to such registration statement would in the good faith judgment of the Board of Directors of the Company require disclosure of material nonpublic information that, if disclosed at such time, would be materially harmful to the interests of the Company and its stockholders; provided, however, that during any such period all executive officers and directors of the Company are also prohibited from selling securities of the Company (or any security of any of the Company’s subsidiaries or affiliates). In the event of the suspension of effectiveness of any registration statement pursuant to this Section 1.4, the applicable time period during which such registration statement is to remain effective shall be extended by that number of days equal to the number of days the effectiveness of such registration statement was suspended. No more than one (1) such suspension may be initiated in any twelve (12) month period.

1.5 Information from Holder . It shall be a condition precedent to the obligations of the Company to take any action pursuant to this Section 1 with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Company such information regarding itself, the Registrable Securities held by it, and the intended method of disposition of such securities as shall be reasonably required to effect the registration of such Holder’s Registrable Securities.

1.6 Expenses of Registration

. All expenses other than underwriting discounts and commissions incurred in connection with registrations, filings or qualifications pursuant to Sections 1.2 and 1.3, including (without limitation) all registration, filing and qualification fees, printers’ and accounting fees, fees and disbursements of counsel for the Company and the reasonable fees and disbursements of one counsel for the selling Holders (which counsel shall be selected by selling Holders holding a majority of the Registrable Securities included in such registration) shall be borne by the Company. Notwithstanding the foregoing, the Company shall not be required to pay for any expenses of any registration proceeding begun pursuant to Section 1.2 or Section 1.3 if the registration request is subsequently withdrawn at the request of the Holders of a majority of the Registrable Securities to be registered (in which case all participating Holders shall bear such expenses pro rata based upon the number of Registrable Securities that were to be included in the withdrawn registration), unless, in the case of a registration requested under Section 1.3, the Holders of a majority of the Registrable Securities agree to forfeit their right to one registration pursuant to Section 1.3 and provided, however, that if at the time of such withdrawal, the Holders have learned of a material adverse change in the condition, business or prospects of the Company from that known to the Holders at the time of their request and have withdrawn the request with reasonable promptness following their discovery of such material adverse change, then the Holders shall not be required to pay any of such expenses and shall retain their rights pursuant to Section 1.3.

1.7 Delay of Registration . No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any such registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Section 1.

1.8 Indemnification . In the event any Registrable Securities are included in a registration statement under this Section 1:

(a) To the extent permitted by law, the Company will indemnify and hold harmless each Holder, the partners, officers, directors and stockholders of each Holder, legal counsel and accountants for each Holder, any underwriter (as defined in the Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Act or the 1934 Act, against any losses, claims, damages or liabilities (joint or several) to which they may become subject under the Act, the 1934 Act, any state securities laws or any rule or regulation promulgated under the Act, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or violations (collectively a “Violation”): (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state in such registration statement a material fact required to be stated therein, or necessary to make the statements therein not misleading or (iii) any violation or alleged violation by the Company of the Act, the 1934 Act, any state securities laws or any rule or regulation promulgated under the Act, the 1934 Act or any state securities laws, and the Company will reimburse each such Holder, underwriter, controlling person or other aforementioned person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that the indemnity agreement contained in this subsection l.8(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld), nor shall the Company be liable in any such case for any such loss, claim, damage, liability or action to the extent that it arises out of or is based upon a Violation that occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such registration by any such Holder, underwriter, controlling person or other aforementioned person; provided further, however, that the foregoing indemnity agreement with respect to any preliminary prospectus shall not inure to the benefit of any Holder or underwriter or other aforementioned person, or any person controlling such Holder or underwriter, from whom the person asserting any such losses, claims, damages or liabilities purchased shares in the offering, if a copy of the most current prospectus was not sent or given by or on behalf of such Holder or underwriter or other aforementioned person to such person, if required by law to have been so delivered, at or prior to the written confirmation of the sale of the shares to such person, and if the prospectus (as so amended or supplemented) would have cured the defect giving rise to such loss, claim, damage or liability.

(b) To the extent permitted by law, each selling Holder will indemnify and hold harmless the Company, each of its directors, each of its officers who has signed the registration statement, each person, if any, who controls the Company within the meaning of the Act, legal counsel and accountants for the Company, any underwriter, any other Holder selling securities in such registration statement and any controlling person of any such underwriter or other Holder, against any losses, claims, damages or liabilities (joint or several) to which any of the foregoing persons may become subject, under the Act, the 1934 Act, any state securities laws or any rule or regulation promulgated under the Act, the 1934 Act or any state securities laws, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder expressly for use in connection with such registration; and each such Holder will reimburse any person intended to be indemnified pursuant to this subsection l.8(b) for any legal or other expenses reasonably incurred by such person in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that the indemnity agreement contained in this subsection l.8(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Holder (which consent shall not be unreasonably withheld), and provided that in no event shall any indemnity under this subsection l.8(b) exceed the net proceeds from the offering received by such Holder.

(c) Promptly after receipt by an indemnified party under this Section 1.8 of notice of the commencement of any action (including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 1.8, deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party (together with all other indemnified parties that may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the fees and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, if prejudicial to its ability to defend such action, shall relieve such indemnifying party of liability to the indemnified party under this Section 1.8 to the extent of such prejudice, but the omission to so deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 1.8.

(d) If the indemnification provided for in this Section 1.8 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim, damage or expense referred to herein, then the indemnifying party, in lieu of indemnifying such indemnified party hereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such loss, liability, claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and the indemnified party on the other hand in connection with the statements or omissions that resulted in such loss, liability, claim, damage or expense, as well as any other relevant equitable considerations; provided, however, that no contribution by any Holder, when combined with any amounts paid by such Holder pursuant to Section 1.8(b), shall exceed the net proceeds from the offering received by such Holder. The relative fault of the indemnifying party and the indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

(f) The obligations of the Company and Holders under this Section 1.8 shall survive the completion of any offering of Registrable Securities in a registration statement under this Section 1 and otherwise.

1.9 Assignment of Registration Rights . The rights to cause the Company to register Registrable Securities pursuant to this Section 1 may be assigned (but only with all related obligations) by a Holder to a transferee or assignee of such securities that (i) is a subsidiary, parent, partner, limited partner, retired partner, member, former member, stockholder or affiliate of a Holder, (ii) is a Holder’s family member or trust for the benefit of an individual Holder, or (iii) after such assignment or transfer, holds at least 25% of the Registrable Securities (subject to appropriate adjustment for stock splits, stock dividends, combinations or the like) held by such Holder immediately prior to such assignment or transfer, provided: (a) the transferee or assignee is not a direct competitor of the Company or an affiliate of a direct competitor of the Company, (b) the Company is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned and (c) such transferee or assignee agrees in writing to be bound by and subject to the terms and conditions of this Agreement.

1.10 “Market Stand-Off” Agreement .

(a) Each Holder hereby agrees that it will not, without the prior written consent of the managing underwriter, during the period commencing on the date of the final prospectus relating to the Company’s Initial Offering and ending on the date specified by the Company and the managing underwriter (such period not to exceed one hundred eighty (180) days) (i) lend, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock held immediately prior to the effectiveness of the Registration Statement for such offering, or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or other securities, in cash or otherwise. The foregoing provisions of this Section 1.10 shall apply only to the Initial Offering of equity securities, and shall (i) not apply to the sale of any shares to an underwriter pursuant to an underwriting agreement, (ii) not apply to any Holder that owns less than one percent of the issued and outstanding common stock of the Company, and (iii) shall only be applicable to the Holders if all officers, directors and greater than one percent (1%) stockholders of the Company enter into similar agreements. The underwriters in connection with the Company’s Initial Offering are intended third-party beneficiaries of this Section 1.10 and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. Each Holder further agrees to execute such agreements as may be reasonably requested by the underwriters in the Company’s Initial Offering that are consistent with this Section 1.10 or that are necessary to give further effect thereto. Notwithstanding the foregoing, the prior written consent of the managing underwriter shall not be required for an assignment of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock by a Holder to a transferee or assignee that is a subsidiary, parent, partner, limited partner, retired partner, member, former member, stockholder or affiliate of a Holder, provided however, that such transferee or assignee agrees in writing to be bound by and subject to the provisions of this Section 1.10.

1.11 Termination of Registration Rights . No Holder shall be entitled to exercise any right provided for in this Section 1 (i) after three (3) years following the consummation of the Initial Offering, or (ii) as to any Holder, such earlier time after the Initial Offering at which such Holder (A) can sell all shares held by it in compliance with Rule 144 or (B) holds one percent (1%) or less of the Company’s outstanding Common Stock and all Registrable Securities held by such Holder (together with any affiliate of the Holder with whom such Holder must aggregate its sales under Rule 144) can be sold in any three (3)-month period without registration in compliance with Rule 144.

2. Right of First Refusal Subject to the terms and conditions specified in this Section 2, the Company hereby grants to each Investor a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined). Each time the Company proposes to sell any shares of, or securities convertible into or exchangeable or exercisable for any shares of, its capital stock (“ROFR Shares”) to a third party, the Company shall first make an offering of such ROFR Shares to each Investor in accordance with the following provisions:

(a) The Company shall deliver a notice in accordance with Section 3.5 (“ROFR Notice”) to the Investors stating (i) its bona fide intention to sell such ROFR Shares and the identity of the proposed purchaser(s), (ii) the number of such ROFR Shares to be purchased by such purchaser(s) and (iii) the price and terms upon which it has agreed to sell such ROFR Shares.

(b) By written notification received by the Company within twenty (20) calendar days after receipt of the ROFR Notice, each Investor may elect to purchase, at the price and on the terms specified in the ROFR Notice, up to that portion of such ROFR Shares that equals the proportion that the number of shares of Common Stock that are Registrable Securities issued and held by such Investor (assuming full conversion and exercise of all convertible and exercisable securities then outstanding) bears to the total number of shares of Common Stock of the Company then outstanding (assuming full conversion and exercise of all convertible and exercisable securities then outstanding).

(c) If all ROFR Shares that Investors are entitled to obtain pursuant to subsection 2(b) are not elected to be obtained as provided in subsection 2(b) hereof, the Company may, during the ninety (90) day period following the expiration of the period provided in subsection 2(b) hereof, sell the remaining unsubscribed portion of such ROFR Shares to the proposed purchaser(s) at a price not less than that, and upon terms no more favorable to such persons than those, specified in the ROFR Notice. If the Company does not consummate the sale of the ROFR Shares within such period, the right provided hereunder shall be deemed to be revived and such ROFR Shares shall not be sold unless first reoffered to the Investors in accordance herewith.

(d) The right of first refusal in this Section 2 shall not be applicable to (i) the issuance or sale of shares of Common Stock (or options therefor) to employees, directors, consultants and other service providers for the primary purpose of soliciting or retaining their services pursuant to plans or agreements approved by the Company’s Board of Directors, (ii) the issuance of securities pursuant to a bona fide, firmly underwritten public offering of shares of Common Stock registered under the Act, (iii) the issuance of securities pursuant to the conversion or exercise of convertible or exercisable securities, or (iv) the issuance of securities in connection with a bona fide business acquisition of or by the Company, whether by merger, consolidation, sale of assets, sale or exchange of stock or otherwise, approved by the Company’s Board of Directors. In addition to the foregoing, the right of first offer in this Section 2 shall not be applicable with respect to any Investor in any subsequent offering of Shares if (i) at the time of such offering, the Investor is not an “accredited investor,” as that term is then defined in Rule 501(a) of the Act and (ii) such offering of Shares is otherwise being offered only to accredited investors.

(e) The rights provided in this Section 2 may not be assigned or transferred by any Investor.

(f) The covenants set forth in this Section 2 shall terminate and be of no further force or effect upon the consummation of the Initial Offering.

3. Miscellaneous .

3.1 Successors and Assigns . Except as otherwise provided herein, the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties (including transferees of any shares of Registrable Securities). Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

3.2 Governing Law . This Agreement shall be governed by and construed under the laws of the State of Delaware.

3.3 Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

3.4 Titles and Subtitles . The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

3.5 Notices . All notices and other communications given or made pursuant hereto shall be in writing and shall be deemed effectively given: (i) upon personal delivery to the party to be notified, (ii) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient; if not, then on the next business day, (iii) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the respective parties at the addresses set forth on the signature pages attached hereto (or at such other addresses as shall be specified by notice given in accordance with this Section 3.5).

3.6 Expenses . If any action at law or in equity is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled.

3.7 Entire Agreement; Amendments and Waivers . This Agreement (including the Exhibits hereto, if any) constitutes the full and entire understanding and agreement among the parties with regard to the subjects hereof and thereof. Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of the Company and the holders of a majority of the Registrable Securities. Any amendment or waiver effected in accordance with this paragraph shall be binding upon each holder of any Registrable Securities, each future holder of all such Registrable Securities, and the Company.

3.8 Severability

. If one or more provisions of this Agreement are held to be unenforceable under applicable law, such provision(s) shall be excluded from this Agreement and the balance of the Agreement shall be interpreted as if such provision(s) were so excluded and shall be enforceable in accordance with its terms.

3.9 Aggregation of Stock . All shares of Registrable Securities held or acquired by affiliated entities (including affiliated venture capital funds) or persons shall be aggregated together for the purpose of determining the availability of any rights under this Agreement.

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

	COMPANY :

	AEMETIS, INC.

	By:	/s/ Eric McAfee
		Eric McAfee,
		Chief Executive Officer

	Address:	20400 Stevens Creek Blvd., Suite 700
		Cupertino, CA 95014

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

	INVESTORS:

	Sprott Asset Management GP, Inc. in its capacity as general partner of Sprott Asset Management, LP in its capacity as Manager of Sprott PC Trust
	(Print exact name of Investor)

	/s/ Kristin McTaggart, Chief Compliance Officer
	(Signature)

	INVESTORS:

	Third Eye Capital Credit Opportunities S.ar.I, in its capacity as Managing General Partner of Third Eye Capital Credit Opportunities Fund – Insight Fund (Print exact name of Investor)

	/s/ Richard Goddard, Manager
	(Signature)

	/s/ Robert L. DeNormandie, Manager
	(Signature)

SIGNATURE PAGE TO

INVESTORS’ RIGHTS AGREEMENT

EXHIBIT 99.1

FOR IMMEDIATE RELEASE

Media Contact:	Investor Relations:	Investor & Analyst Contact:
Andy Foster	Michael Bayes	Todd Waltz
(408) 213-0928	Liviakis Financial	(408) 213-0925
afoster@aemetis.com	(415) 389-4670	twaltz@aemetis.com

Aemetis Announces Acquisition of Cilion, Inc., and California Ethanol Plant

Company Will Leverage Plant Infrastructure To Develop Next-Generation Biorefinery

CUPERTINO, Calif. – July 10, 2012 – Aemetis, Inc. (OTCPK: AMTX), an advanced fuels and renewable chemicals company, announced today that the company has acquired Cilion, Inc., including a 55 million gallon per year (mgy) ethanol production plant located in Keyes, CA.

In 2010, Aemetis entered into a multi-year project and lease agreement with Cilion to upgrade, restart, and operate the Cilion biofuels plant. Aemetis successfully retrofitted and then restarted the plant in April 2011, and has achieved continuous operations for more than one year.

The acquisition of Cilion advances Aemetis’ plans to utilize the existing ethanol plant’s infrastructure to create a next-generation biorefinery producing advanced biofuels and renewable chemicals in addition to ethanol and animal feed products.

I n addition to the Keyes, California ethanol plant, Cilion's other assets include spare parts and equipment that will be used at the plant.

In 2011, Aemetis acquired Zymetis, Inc., a biotechnology company with a patented organism that enables the production of renewable advanced biofuels and biochemicals.

“The acquisition of the Keyes plant accelerates our plan to expand this world-class ethanol production facility into a next-generation biorefinery capable of producing advanced renewable fuels and biochemicals,” said Eric McAfee, Chairman and CEO of Aemetis.

In conjunction with the acquisition, Third Eye Capital, Aemetis’ existing senior lender, provided a $15 million term loan and an $18 million working capital financing facility to assist Aemetis in the acquisition and to provide ongoing working capital.

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Aemetis Announces Acquisition of Cilion

Page Two

“Our substantial ongoing commitment to Aemetis is demonstrative of our belief in the high quality assets and first-class team built under Eric McAfee’s leadership,” said Arif Bhalwani, President and CEO of Third Eye Capital. “The acquisition of the Keyes plant will allow Aemetis to accelerate the next phase of its renewable fuels and chemicals strategy.”

Specific details of the Cilion acquisition can be found in the Form 8-K filed by Aemetis with the Securities and Exchange Commission on July 10, 2012.

About Aemetis

Headquartered in Cupertino, California, Aemetis produces advanced fuels. Aemetis operates a 55 million gallon biofuels plant in California, and built and operates a nameplate 50 million gallon per year renewable chemicals and advanced fuels production facility on the east coast of India. In 2011, Aemetis received a California Energy Commission grant to commercialize technology that enables the production of advanced biofuels from both non-food and traditional feedstocks. For additional information about Aemetis, please visit www.aemetis.com .

Forward Looking Statements

The information contained herein includes forward-looking statements related to future events. Statements regarding future events are based on current expectations and are necessarily subject to associated risks related to, among other things, the ability of the company to adequately protect our technologies, intellectual property and product candidates, the availability of resources used for industrial production, and the ability of the company to successfully execute our business plan and our ability to navigate governmental policy and regulation. Actual results may differ materially from those in the projections or other forward-looking statements made herein. For information regarding other related risks, please see the "Risk Factors" section of the company’s filings with the SEC.

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