10-K Its out!

Expected Activity Moving Forward
While our existing corn oil extraction facilities and license agreements are producing sufficient cash flows to cover most of our minimum overhead requirements, we are currently evaluating opportunities to liquidate an 80% interest in these facilities to a strategic investor in order to repay a significant amount of our existing convertible debt in lieu of issuing additional shares of common stock. We accordingly intend to fund our principal liquidity and capital resource requirements through new financing and licensing activities.
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Cash Flows Provided By Operating Activities

Our top priority for 2010 is to execute several license agreements with ethanol producers to generate sufficient royalties for us to return to positive cash flow and to achieve profitability by the end of 2010.
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Cash Flows Provided By Financing Activities
We have sufficient capital sources committed to cover our minimum overhead requirements and the cost of prosecuting infringement of our patented extraction technologies for the foreseeable future. In addition, Fagen, Inc., an engineering and procurement contractor with extensive experience in the ethanol industry, has offered to provide financing for most of the costs needed for construction and installation of [four to six] extraction facilities based on our patented extraction technologies. We currently have no committed source of capital for the completion of construction of our existing extraction facilities. These facilities are collectively operating at about 50% of their aggregate design capacity due to a lack of capital.
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Cash Flows Used In Investment Activities
After repaying a substantial amount of our convertible debt and achieving profitability, our long term plan includes the completion of significant new equity financing, possibly in the form of a secondary public offering or a large project financing, in order to greatly amplify and accelerate the construction of facilities based on our patented and patent-pending extraction and other technologies.
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As of April 15, 2010, there were 10,786,612,055 shares of common stock outstanding.
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Gross Profit
Gross profit for year ended December 31, 2009 was $1,222,992, representing a gross margin of 31.6% as compared to $(114,687), (2.5)%, in the comparable period of the prior year. The increase in margin as a percentage of sales was primarily due to the Company’s changed business operations during 2009.
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Our plans for the balance of 2010 involve the following activities:

Ø Execute new corn oil extraction license agreements during 2010 with ethanol producers with an aggregate capacity of at least 1 billion gallons per year of ethanol;
Ø Achieve profitability by the end of this year; and,
Ø Continue the 30% debt reduction realized in 2009 by reducing debt by an additional 30% during 2010.
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ITEM 3 LEGAL PROCEEDINGS


INFRINGEMENT

On October 13, 2009, the U.S. Patent and Trademark Office issued U.S. Patent No. 7,601,858, titled "Method of Processing Ethanol Byproducts and Related Subsystems” (the ’858 Patent) to GS CleanTech Corporation, a wholly-owned subsidiary of GreenShift Corporation. On October 27, 2009, the U.S. Patent and Trademark Office issued U.S. Patent No. 7,608,729, titled "Method of Freeing the Bound Oil Present in Whole Stillage and Thin Stillage” (the ’729 Patent) to GS CleanTech. Both the ‘858 Patent and the ‘729 Patent relate to the Company’s corn oil extraction technologies.


On October 13, 2009, GS CleanTech filed a legal action in the United States District Court, Southern District of New York captioned GS CleanTech Corporation v. GEA Westfalia Separator, Inc.; and DOES 1-20, alleging infringement of the ‘858 Patent. On October 13, 2009, GS CleanTech filed a Motion to Dismiss with the same court relative to a separate complaint filed previously by Westfalia alleging (1) false advertising in violation of the Lanham Act § 43(a); (2) deceptive trade practices and false advertising in violation of New York General Business Law §§ 349, 350 and 350-a; and (3) common law unfair competition. On October 13, 2009, Westfalia filed its First Amended Complaint in the matter captioned GEA Westfalia Separator, Inc. and Ace Ethanol, LLC v. GreenShift Corporation, which complaint included Ace Ethanol, an ethanol production company, and added claims seeking a declaratory judgment of invalidity and/or non-infringement of the ‘858 Patent. On October 13, 2009, ICM, Inc. filed a complaint in the United States District Court, District of Kansas in the matter captioned ICM, Inc. v. GS CleanTech Corporation and GreenShift Corporation, alleging unfair competition, interference with existing and prospective business and contractual relationships, and deceptive trade practices. ICM is also seeking declaratory judgment of invalidity and non-infringement of the ‘858 Patent. On October 15, 2009, GS CleanTech filed a Notice of Filing First Amended Complaint for infringement of the ‘858 Patent, along with a copy of the First Amended Complaint, which added ICM, Ace Ethanol, Lifeline Foods LLC and ten additional DOES as defendants in the case pending in the Southern District of New York. In October 2009, GS CleanTech filed a Motion to Dismiss or Transfer the case to New York with respect to ICM’s Kansas lawsuit. These matters were only recently commenced, there have been no substantive rulings on the merits and Management is unable to characterize or evaluate the probability of any outcome at this time.


During February 2010, GS CleanTech commenced a legal action in the United States District Court, Southern District of Indiana captioned GS CleanTech Corporation v. Cardinal Ethanol, LLC, and a separate legal action in the United States District Court, Northern District of Illinois captioned GS CleanTech Corporation v. Big River Resources Galva, LLC and Big River Resources West Burlington, LLC. In addition to asserting claims for infringement of the ‘858 Patent in each of these cases, GS CleanTech filed a motion for preliminary injunction with each complaint. In each motion, GS CleanTech argued that it has sufficient evidence to prove that Cardinal and Big River are infringing GS CleanTech’s patented corn oil extraction technologies, and that this infringement has caused and will continue to cause irreparable harm to GS CleanTech. ICM sold Cardinal and Big River the equipment that each of Cardinal and Big River have used and are using to infringe the ‘858 Patent. ICM has assumed the defense of each of the above matters involving Cardinal and Big River, and petitioned the Indiana and Illinois courts to stay review of GS CleanTech’s motions for preliminary injunction in each case until the Kansas court referenced above rules on GS CleanTech’s pending motion to dismiss or to transfer to New York. These matters were only recently commenced and Management is unable to characterize or evaluate the probability of any outcome at this time.


The Company estimates that as many as 40 ethanol producers are infringing the Company’s patents. ICM has not denied in its pleadings that its equipment has been sold and is being used in a manner covered by the patents. GEA Westfalia’s pleadings also suggest that it admits that the Company’s patent claims cover processes utilized by ethanol producers that have purchased GEA Westfalia’s equipment. Rather, both parties rely upon arguments that the Company’s patents are invalid based upon prior art that has been considered and rejected by the U.S. Patent and Trademark Office (“PTO”). The Company believes these arguments have been fully considered and rejected by the PTO. The Company intends to file additional lawsuits involving any and all infringing use of the Company’s patents. The Company’s position is that any infringing ethanol producer is liable for a minimum of reasonable royalties for any infringing use of the Company’s patented technologies beginning on the publication date of the ‘858 Patent. The Company intends to seek additional relief for instances of intentional infringement.

The estimated completion times for assets recorded in construction in progress are as follows:

Location Current Status
Oshkosh, Wisconsin Operational
Medina, New York Operational
Marion, Indiana Operational
Riga, Michigan Operational
Lakota, Iowa Operational

http://www.sec.gov/Archives/edgar/data/1269127/000126912710000045/gers10k09.htm

SkunK

PS.  Note: Executive Compensation on page 64
First note that is lists ALL compensation over the last three years.
The following table sets forth all compensation awarded to, earned by, or paid by GreenShift Corporation and its subsidiaries (or by third parties as compensation for services to GreenShift Corporation or its subsidiaries) to Kevin Kreisler, the Company’s Chief Executive Officer, Dave Winsness, the Company’s Chief Technology Officer, Greg Barlage, the Company’s Chief Operating Officer, Ed Carroll, the Company’s Chief Financial Officer, and Dr. Richard Krablin, the Company’s Executive Vice President, Special Projects.

Note that all five Officers/Directors rate $150,000 in salary.  Most took just over 2/3rds of that - or $100,500 in 2009.  Note also that the Chairman/CEO took less than  2/3 of even that - or $66,982 in 2009 in TOTAL compensation.  Not exactly the narrative we read on the boards . . .