Strategic Alliance Agreement

AGREEMENT made this day of September by and between Cross Atlantic Commodities, Inc., a Nevada Corporation (?CACI?) with an office at 245 Park Avenue, New York, NY 10167 and Martell Global Commodities, LLC, a New York limited liability company (?MGC?) with an office at 405 Park Avenue, 15th Floor, New York, NY 10022. MGC and CACI are sometimes collectively referred to herein as ?the parties hereto.?


RECITALS


1. CACI is engaged in the business of the purchase and sale of certain commodities, including, but not limited to, green coffee beans, for distribution in North America.


2. CACI has entered into an agreement dated August 9, 2005 with Victoria Coffees Company (U) Limited (?Victoria?) (the ?Victoria Agreement?) for the purchase and sale of WUGAR Green Coffee Beans, which is annexed hereto as Exhibit ?A? and is incorporated herein by reference.


3. MGC is in the business, among other things, of financing commodity transactions.


4. The parties hereto desire to enter into a strategic alliance, on an exclusive basis, to purchase coffee pursuant to the Victoria Agreement and other commodity transactions worldwide.


NOW, THEREFORE, for good and valuable consideration, the parties agree as follows:


1. Victoria Agreement. Pursuant to the Victoria Agreement, CACI has agreed to purchase WUGAR green coffee beans with shipments commencing October 17, 2005 and with the Victoria Agreement terminating on December 31, 2015. Furthermore, pursuant to the Victoria Agreement all payments shall be made by documentary letter of credit, FOB (ship) Mombassa. Subject to the terms of this Agreement MGC agrees to furnish the letters of credit necessary to purchase the WUGAR green coffee beans pursuant the Victoria Agreement. MGC shall have the right to inspect and approve each shipment to assure that goods purchased conform to the contract and all purchase order terms and conditions prior to the opening any letter of credit. In the event that MGC elects not to open the letter of credit because it does not believe that the goods conform to the contract and all purchase order terms and conditions, then CACI may purchase such non-approved coffee independent of this Agreement. CACI agrees not to make any modification to the Victoria Agreement, or any requirements thereunder, without the express written approval of MGC. CACI may supplement or replace Victoria as a supplier with one or more other suppliers which can supply the same quality coffee on substantially the same or better terms and conditions.


2. Requests for Letter of Credit. All requests by CACI to MGC shall be in writing. Prior to CACI requesting MGC to obtain any letter of credit hereunder, CACI shall deliver to MGC, a copy of the relevant purchase order, which shall in all cases be for approved CSCE ?C? Contract coffee; a valid insurance policy covering risk of loss of the goods being purchased (which names MGC as an additional insured), all expenses and contemplated profit on the sale of the goods being purchased; confirmation that a valid hedge contract exists for the sale of the goods being purchased that covers all in cost of goods sold, including, but not limited to, shipping, taxes, insurance, inspections, customs duty and expenses, inland freight, warehousing, a thirty seven and one half percent (37 1/2%) per annum return on money in use for the letter of credit being issued to purchase the goods, from the date of issuance of the letter of credit until the date it is repaid; and any other requirements of MGC or its financial institution. All shipping documents, for each and every shipment, shall designate MGC as consignee. All insurance policies shall list MGC as an additional insured. MGC shall have the right to refuse to fund any transaction that it, in its sole discretion, believes does not conform to the Victoria Agreement or this Agreement.


3. Hedge Account. The hedge account shall be in the name of CACI, but under the exclusive dominion and control of MGC. The account shall be at Triland USA, Inc., 520 Madison Avenue, New York, NY 10022 or such other commodity broker designated by MGC and approved by CACI. CACI agrees to execute any, power of attorney or control or security agreement required by MGC to implement the terms of this Agreement, including, without limitation of any other rights of MGC, the right to withdraw funds for amounts that MGC, in its sole discretion, believes are expenses that are required to be paid or reimbursed pursuant to this Agreement or are owed to MGC. CACI shall, simultaneous herewith, deposit $50,000 with Triland USA, Inc. CACI shall not withdraw such capital from the hedge account during the pendency of this Agreement. All hedge account funding requirements shall be determined by MGC with the approval of CACI. CACI shall fund the hedge account for the first two shipments under the Victoria Agreement (through the second shipment due to be shipped the week of November 14, 2005). After the second shipment, CACI may elect to (a) continue to fund the hedge account in a manner sufficient to support the Victoria Agreement, (b) attempt to reduce the quantities to be shipped under the Victoria Agreement to an amount where CACI has adequate capital to fund the hedge account, or (c) request MGC, if in MGC?s sole discretion it elects to do so, to fund the hedge account for such shipments, being compensated at a rate of thirty seven and one-half (37 1/2%) per annum super priority return on money in use. Except in the case of a request by MGC pursuant to subsection 3. (c) above where MGC has agreed to fund the hedge, in which case MGC shall be responsible for all margin calls related to such hedge, CACI shall be responsible for all margin calls on the hedge. Except as otherwise set forth in this paragraph, all hedge account funding requirements shall be borne by CACI. All hedge fund expenses shall be repaid as described in Subsection 4. (d) below.


4. Risk of Loss and Distribution of Proceeds. All proceeds from the sale of commodities shall be deposited in the brokerage account. The risk of loss on any transaction shall be borne by CACI. ...