Cactus Wren Jojoba, Ltd., Cecil R. Almand, Tax Matters Partner - Page 33

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                        (f) Over $807,100                    42.5%"                                      
                  It is clear from the words of the licensing agreement that                             
            Yuma Mesa was not going to be actively involved in the                                       
            development of the jojoba plantation.  As paragraph 2 in section                             
            A points out:                                                                                
                  Said agreement provides that upon the sole                                             
                  determination by Hilltop Plantations, Inc. as                                          
                  Contractor, that the seed and/or bean of the jojoba                                    
                  plants developed may be sold commercially, then and in                                 
                  that event commercial farming and marketing shall be                                   
                  conducted pursuant to this Agreement.                                                  
            The licensing agreement also states "that this Agreement in no                               
            way constitutes a partnership or a joint venture between Licensor                            
            * * * [Yuma Mesa] and Licensee * * * [Mesa Plantations]."                                    
                  The license agreement entered into between Cactus Wren and                             
            MBP, on December 31, 1983, gives MBP (Contractor/Licensee), "the                             
            exclusive right to utilize the technology developed for the                                  
            account of the Licensor * * * [Cactus Wren]" in consideration of                             
            the payment by the Contractor/Licensee * * * [MBP] of royalties                              
            based upon future sales.  Pursuant to the licensing agreement,                               
            these "royalties shall be payable to Licensor * * * [Cactus Wren]                            
            based upon cumulative annual gross revenue from sales as follows:                            
                        (a) 0 to $56,250                     0.0%                                        
                        (b) $56,251 to $75,000               3.0%                                        
                        (c) $75,001 to $93,750               10.0%                                       
                        (d) $93,751 to $131,250              25.0%                                       
                        (e) $131,251 to $187,500             37.0%                                       





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