LICENSE AGREEMENT

EXHIBIT 10.2

LICENSE AGREEMENT

This Agreement is made by and between Temple University — Of The Commonwealth System of Higher Education (hereinafter referred to as “TEMPLE”), a corporation organized and existing under the laws of the Commonwealth of Pennsylvania, having a principal place of business at Broad Street and Montgomery Avenue, Philadelphia, Pennsylvania and Save the World Air, Inc. (hereinafter referred to as “COMPANY”), a corporation organised and existing under the laws of the State of Nevada, having a principal place of business at 5125 Lankershim Boulevard, North Hollywood, California 91601.

WHEREAS, TEMPLE is the owner of the entire right and interest in the United States patent applications and patents listed in Exhibit A, attached hereto and incorporated herein by reference, and technical information pertaining to the effect of electrical fields on crude oil viscosity; and

WHEREAS, COMPANY desires to obtain an exclusive worldwide license under patent applications and patents for the aforementioned intellectual property;

NOW, THEREFORE, in consideration of the premises and of the covenants and obligations hereinafter set forth, and intending to be legally bound, the parties hereby agree as follows:

     ARTICLE 1. DEFINITIONS

The following definitions shall apply throughout this Agreement:

1.1. “AFFILIATE” shall mean each and every business entity controlling, controlled by or under common control with COMPANY for the purposes of manufacture, use or sale of LICENSED PRODUCT. For purposes of this definition “control” shall mean ownership, directly or indirectly, of at least fifty percent (50%) of the voting stock.

1.2. “CONFIDENTIAL INFORMATION” shall mean any information disclosed or tangible property supplied by one party to the other pursuant to this Agreement provided that information disclosed in writing shall be deemed CONFIDENTIAL INFORMATION only if marked “Confidential” and information disclosed orally shall be deemed CONFIDENTIAL INFORMATION only if reduced to writing and a copy marked “Confidential” is provided to the receiving party within thirty (30) days of the date of oral disclosure. However, CONFIDENTIAL INFORMATION shall not include information that: (i) was known to the receiving party prior to the date of disclosure by the disclosing party or is developed independently of information received from the disclosing party by those who have not had access to this information; or (ii) is lawfully received in good faith at any time by the receiving party from others lawfully in possession of the same and having the right to disclose the same: or (iii) is, as of the date of receipt, in the public domain or subsequently enters the public domain other than by reason of acts or omissions of the receiving party; or (iv) is required to be disclosed by law, rule of court or regulation; or (v) is independently developed by the receiving party, as evidenced by written records.

1.3. “EFFECTIVE DATE” shall mean the date this Agreement is signed by the last to sign of the parties.

1.4. “INVENTOR” shall mean, singly or collectively, Dr. Rongjia Tao and others of TEMPLE.

1.5. “LICENSED PRODUCT” shall mean any product the use, SALE, offer for SALE, manufacture, or importation of which, if unlicensed, would infringe one or more VALID CLAIMS of: (i) a patent application within PATENT RIGHTS if such patent application were issued as a patent or (ii) a patent within PATENT RIGHTS. A product which is a LICENSED PRODUCT by virtue of its use, offer for SALE, manufacture, or importation under at least one VALID CLAIM within PATENT RIGHTS shall remain a LICENSED PRODUCT for all purposes of this Agreement including but not limited to calculation of NET SALES, notwithstanding such product’s subsequent exportation to another country where its further disposition is not covered by any VALID CLAIM within PATENT RIGHTS.

1.6. “LICENSEE” shall mean COMPANY and its AFFILIATES.

1.7. “NET SALES” shall mean the gross receipts from the SALE, in any country, of LICENSED PRODUCT by LICENSEE or by its SUBLICENSEES less deductions for: (i) transportation and insurance charges; (ii) sales and excise taxes, and any other governmental charges or duties paid; (ii) normal and customary trade, quantity and cash discounts allowed; (iii) sales commissions; and (iv) allowances on account of rejection or return by customers. However, except where the SUBLICENSEE is the end-user of LICENSED PRODUCT, any SALE to a SUBLICENSEE shall be excluded from the computation of NET SALES, but any subsequent SALE by the SUBLICENSEE shall be included in the computation of NET SALES.

1.8. “PATENT RIGHTS” shall mean the patent applications and patents listed in Exhibit A and any foreign counterparts thereof, or any continuations, continuations-in-part, divisions, re-issues, additions, renewals or extensions thereof, and any patents issuing therefrom.

1.9. “SALE” shall mean any transaction for which consideration is received for the sale, lease, license, transfer or other disposition of LICENSED PRODUCT by LICENSEE or by its SUBLICENSEES.

1.10. “SUBLICENSEE” shall mean a third party which is granted a sublicense under any of the rights granted by TEMPLE to LICENSEE under this Agreement, including but not limited to any sublicensee of LICENSEE, any sublicensee of a sublicensee of LICENSEE, and so on.

1.11. “TECHNICAL INFORMATION” shall mean any CONFIDENTIAL INFORMATION of a technical nature relating to LICENSED PRODUCT, which is in the possession of TEMPLE as of the EFFECTIVE DATE, and which is necessary or useful to LICENSEE in furtherance of the development, manufacture or marketing of LICENSED PRODUCT.

1.12. “VALID CLAIM” shall mean a claim of a patent application or patent, which claim has not expired and has not been held unenforceable, unpatentable or invalid by unappealable decision of a court or other governmental agency of competent jurisdiction.

     ARTICLE 2. CONFIDENTIALITY

2.1. The receiving party shall hold all CONFIDENTIAL INFORMATION in strict confidence for a period of five (5) years from the disclosure date; not use said CONFIDENTIAL INFORMATION except as provided in this Agreement; and not disclose, directly or indirectly, said CONFIDENTIAL INFORMATION to others except with the prior written consent of the disclosing party. The receiving party shall use at least the same degree of care to maintain CONFIDENTIAL INFORMATION secret as the receiving party uses in maintaining secret its own confidential information, but always at least a reasonable degree of care. The receiving party shall restrict disclosure of CONFIDENTIAL INFORMATION solely to those of its employees and consultants having a need to know such CONFIDENTIAL INFORMATION in order to accomplish the purposes of this Agreement. The receiving party shall also advise its employees and consultants, before they have access to CONFIDENTIAL INFORMATION, of the obligations of the receiving party under this Agreement, and require such employees and consultants to maintain those obligations.

2.2. Notwithstanding any of the provisions of Paragraph 2.1, LICENSEE shall be entitled, without TEMPLE’S prior written approval, to disclose any CONFIDENTIAL INFORMATION of TEMPLE: (i) to the EPA or any other environmental authority in the world, but only to the extent required by law or regulation to obtain approval to test or market LICENSED PRODUCT and (ii) to agents, consultants or independent contractors of LICENSEE for the sole purpose of assisting LICENSEE in accomplishing the purposes of this Agreement provided that, prior to any such disclosure, the recipient shall be bound by written confidentiality obligations that are at least as strict as those of LICENSEE under this Agreement.

2.3. The receiving party shall, upon written request by the disclosing party, promptly return all written materials or samples of tangible property received hereunder, with the exception that one copy of said written materials may be retained by the receiving party solely for archival purposes. In the alternative, the receiving party shall destroy all materials and confirm such destruction in writing.

2.4. Notwithstanding any other provision of this Agreement, it is recognized by LICENSEE that TEMPLE, through the INVENTOR, shall have the right to publish or present publicly the results of any research concerning LICENSED PRODUCT. However, TEMPLE and the INVENTOR agree to notify LICENSEE in writing of any such proposed publication or presentation thirty (30) days before submission. Should LICENSEE, within thirty (30) days of such notification, advise TEMPLE and the INVENTOR in writing that it wishes to file one or more patent applications pertaining to information contained in the proposed publication or presentation, TEMPLE shall delay submission until after LICENSEE has made such filing. LICENSEE may also request deletion of sensitive information from the proposed publication, and TEMPLE agrees to give good faith consideration to such a request.

     ARTICLE 3. GRANT OF LICENSE RIGHTS

3.1. TEMPLE hereby grants to LICENSEE, until the date on which this Agreement is terminated, a world-wide exclusive license under PATENT RIGHTS and TECHNICAL INFORMATION, with the right to grant sublicenses, to make, have made, use, sell, offer for SALE and import LICENSED PRODUCT.

3.2. Notwithstanding the preceding license grant, TEMPLE shall retain rights to make, have made, use and import LICENSED PRODUCT royalty-free for non-commercial educational and research purposes only, and shall be free to grant these rights to other non-profit educational and research institutions.

3.3. The parties acknowledge that inventions in PATENT RIGHTS may have resulted from United States Government funding, and agree that their rights and obligations under this Agreement shall be subject to TEMPLE’S obligations to the United States Government, if any, which arise out of the receipt by TEMPLE of research funding from the United States Government, in which case LICENSEE agrees that LICENSED PRODUCT sold in the United States under this Agreement shall be manufactured substantially in the United States.

3.4.LICENSEE shall at all times own all LICENSED PRODUCT as tangible property.

     ARTICLE 4. PAYMENTS

4.1. In consideration of the license granted to LICENSEE under the terms of this Agreement, LICENSEE shall pay to TEMPLE a quarterly basis commencing on the first day of each March, June, September and December during the term of this Agreement a royalty on account of NET SALES in the prior calendar quarter. Royalties shall be payable at the following rates: (i) on the first $20,000,000 of NET SALES during a calendar year of the term of this Agreement, seven percent (7%) of NET SALES; (ii) on NET SALES during a calendar year of the term of this Agreement in excess of $20,000,000 and less than or equal to $40,000,000, six percent (6%) of NET SALES; (iii),on NET SALES during a calendar year of the term of this Agreement in excess of $40,000,000, five percent (5%) of NET SALES.

4.2.In further consideration of the license granted to LICENSE under the terms of this Agreement, LICENSEE shall pay to TEMPLE a non-refundable license fee of one hundred thousand dollars ($100,000) within thirty (30) days of the EFFECTIVE DATE. In the event that within thirty (30) days of the EFFECTIVE DATE the parties enter into a written agreement to further develop LICENSED PRODUCT at TEMPLE under the direction of the INVENTOR, which agreement (the “R&D Agreement”) pays TEMPLE five hundred thousand dollars ($500,000) for two years, LICENSEE shall be entitled to pay the license fee in three (3) installments, as follows: (i) forty percent (40%) within thirty (30) days of the EFECTIVE DATE and (ii) thirty percent (30%) on or before each of the first and second anniversaries of the EFFECTIVE DATE. However, if either this Agreement or the R&D Agreement is terminated

before the second anniversary of the EFFECTIVE DATE, the entire unpaid balance of the license fee is due immediately prior to termination.

4.3 In further consideration of the license granted to LICENSEE under the terms of this Agreement, LICENSEE shall pay to TEMPLE, on the first day of January, 2008 and annually thereafter, a non-refundable license maintenance fee of seventy five thousand dollars ($50,000) regardless of or irrespective of actual NET SALES. The license maintenance fee payment due in any calendar year pursuant to this Paragraph 4.3 shall be offset and reduced by payments actually made to TEMPLE in the prior calendar year pursuant to Paragraph 4.1 and Paragraph 4.4.

4.4 In further consideration of the license granted to LICENSEE under the terms of this Agreement, LICENSEE shall pay to TEMPLE twenty-five percent (25%) of all consideration, whether in the form of cash or equity, which LICENSEE receives from its SUBLICENSEES to secure or maintain the sublicense or option thereto, including but not limited to option or sublicense fees, option or sublicense maintenance fees, milestone payments and minimum royalties. However, the following types of consideration are excluded from the calculation under this Paragraph 4.4: (i) research and development funding and (ii) royalties on account of NET SALES by SUBLICENSEE.

4.5 Royalty payments for sales in each country shall commence with the first unit of each LICENSED PRODUCT sold by LICENSEE or by its sublicenses in such country and will end coincident with the expiration date of the last-to-cxpirc issued patent within PATENT RIGHTS in such country covering such LICENSED PRODUCT.

     ARTICLE 5. DUE DILIGENCE AND REPORTING

5.1. LICENSEE shall use reasonable efforts to advance the development of LICENSED PRODUCT and to effect its commercialization as soon as practicable, consistent with prevailing sound business practices relating to the commercialization of similar products; thereafter, during the term of this Agreement, LICENSEE shall endeavor to keep LICENSED PRODUCT reasonably available to the public.

5.2. On or before March 31 of each year during the term of this Agreement, LICENSEE shall provide to TEMPLE a written report detailing LICENSEE’S efforts during the previous year and plans for the current year, relating to the development, regulatory approval, manufacturing and marketing of LICENSED PRODUCT.

     ARTICLE 6. STATEMENTS AND REMITTANCES

6.1. LICENSEE shall keep and maintain complete books and records containing an accurate accounting in sufficient detail of all data required to enable verification of earned royalties and other payments due hereunder.

6.2. Within sixty (60) days after the end of each calendar quarter, LICENSEE shall remit to TEMPLE a statement of NET SALES by LIC