The Scuderi Group has taken many precautions to ensure the strength, scope, validity and ability to license its intellectual property.

Its patent portfolio provides protection for the Scuderi Split-Cycle Engine technology worldwide for at least the next 20 years. The Scuderi Group patent portfolio currently consists of:

The Scuderi Group is committed to continuously increasing the strength of its patent portfolio by investing in independent research and development projects dedicated to advancing the Scuderi Split-Cycle Engine technology. As further developments are made, many more patents will be generated and added to the Company's patent portfolio.

2.) Every Scuderi Group patent application is subjected to an extensive series of worldwide patentability searches. Either patent examiners or professional patent searchers residing in the United States, Europe and Japan conduct these searches.

3.) The Scuderi Group patent portfolio increases in strength with each additional patent issued. As new patents are added to the portfolio, the level of protection increases. Simply put, there is strength in numbers.

The Scuderi Group plans to license the technology to qualified engine manufacturers on a worldwide basis.

Licensing fees (or royalties) typically are based upon a percentage of revenues or the number of units sold. Most licensing arrangements also include an up-front fee that is paid upon initiation of the agreement. This fee is generally a percentage of the projected royalty revenues and can result in a very significant source of revenue.

Up-front fees are expected to be a large portion of the revenues generated for the Scuderi Group during the first 3 years.

As engine manufacturers implement the Scuderi Split-Cycle Engine technology, royalty fees will become the major portion of the licensing revenues.

Low Startup Costs: Since a licensing organization grants the rights to use its technology rather than producing a product or selling a service, the costs to establish the business are very low There is no need for large facilities or expensive equipment.

Low operating costs: The number of people required to manage even a worldwide licensing operation is small when compared to any other type of business.

High profit margins: Companies receiving a large portion of revenue from royalties are among the most profitable in the world. It is not unusual for licensors to achieve net profit margins of over 95%.

Win-Win Scenario: Engine manufacturers will become customers instead of competitors. In fact, because companies using the technology are able to stay competitive and improve their own products, licensing arrangements become a win-win situation for both the licensor and the licensee. This technology will enable automobile manufacturers to continue producing their most profitable line (SUVs), and meet or exceed new government mileage and environmental standards.

Rapid Proliferation of the Technology: Licensing technology to companies that are well established in a market leverages the growth. This enables rapid proliferation that would not be possible by producing a product. The internal combustion engine market is a global market with billions of end users. Significant market penetration would take billions of dollars and decades of effort. However, there are only 769 engine manufacturers, and licensing the Scuderi technology to this customer base is manageable and could be done quickly and efficiently.