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SERVICES AGREEMENT

THIS AGREEMENT, made as of December 2, 2014 by and between Stratean, Inc., with
its principal offices at 2391 South 1560 West, Woods Cross, UT 84087
(hereinafter referred to as "Stratean"), and Combustion Resources Inc., with
offices at 1453 West 820 North, Provo, Utah 84601 (hereinafter referred to as
"Contractor").

 

WITNESSETH THAT:

 

WHEREAS, Stratean desires certain services, as more fully described on Exhibit
A, attached hereto and made a part hereof (hereinafter referred to as
"Services"), and

 

WHEREAS, Contractor is in the business of providing such Services and desires to
provide the Services for Stratean;

 

NOW, THEREFORE, Contractor and Stratean, each in consideration of the covenants
of the other hereinafter set forth, agree as follows:

 

1.TERM. The term of this Agreement shall commence as of the date set forth at
it’s beginning and shall terminate on June 10, 2015 or upon completion of the
Services.

 

2.SCOPE OF SERVICES. Contractor shall provide an efficient business operation
and qualified personnel to perform the Services. Contractor further agrees to
cooperate with Stratean so as to properly promote the best interests of
Stratean, and perform the Services in an expeditious and economical manner
consistent with the best interests of Stratean.

 

3.SERVICES FACILITY. As a part of the Services, Contractor shall arrange for a
facility that is adequate for providing the Services for Stratean (“Facility”).
Contractor will be responsible for payments of the lease for Facility, utilities
associated with providing Services, and liability insurance required by lessor.
Contractor will not be liable for loss, theft, or any damage of equipment or
property owned by Stratean that is located at Facility.

 

4.COMPENSATION. For the proper performance of the Services, Stratean shall
compensate Contractor in accordance with Exhibit B, attached hereto and made a
part hereof.

 

5.CHANGES OF WORK. Stratean reserves the right to modify of amend this Agreement
and the total sum due hereafter either by enlarging or restricting the scope of
the Services. Stratean also acknowledges that additional labor or materials may
be required to complete Services based on items or issues that were not
anticipated or known when the Services described in Attachment A were written.
Any changes of work that are requested or required must be agreed to in writing
by Stratean.

 

 

6.CONFIDENTIALITY. Contractor, its employees and agents shall treat and maintain
as Stratean's confidential property, and not use or disclose to others except as
is necessary to perform Services hereunder (and then only on a confidential
basis satisfactory to Stratean), any information (including any technical
information, experience or data) regarding Stratean's products, plans, programs,
plants, processes, costs, equipment, operations or customers which may be
disclosed to or come within the knowledge of, Contractor, its employees and
agents in the performance of this Agreement, without Stratean's prior written
consent. The provisions of this Section 4 shall not apply to any information
referred to in this Section which Contractor establishes (i) has been published
and has become part of the public domain other than by acts or omissions of
Contractor, its employees and agents, (ii) has been furnished or made known to
Contractor by third parties (other than those acting directly or indirectly for
or on behalf of Stratean) as a matter of legal right and without restriction on
disclosure or use, or (iii) was in Contractor's possession prior to disclosure
by Stratean to Contractor and was not acquired by Contractor, its employees and
agents directly or indirectly from Stratean.

 

7.INDEMNITY. Except as hereinafter set forth in this Section 5, Contractor shall
indemnify and save Stratean and its employees harmless against any and all
liabilities, penalties, demands, claims, causes of action, suits, losses,
damages, costs and expenses (including cost of defense, settlement and
reasonable attorneys' fees) which any or all of them may hereafter suffer,
incur, be responsible for or pay out (whether the same arise out of or in
connection with the Services, or from any operations under or in connection with
this Contract) as a result of bodily injuries (including death) to any person or
damage (including loss of use) to any property occurring to or caused in whole
or in part by, Contractor (or any of its employees), any of its subcontractors
(or any employee thereof), or any person, firm or corporation (or any employee
thereof) directly or indirectly employed or engaged by either Contractor or any
of its subcontractors, including those injuries and property damages caused by
the joint or concurring negligent act or omission of Stratean or its employees.
Upon the request of Stratean, Contractor shall promptly defend any such demand,
claim, cause of action or suit.

 

Stratean agrees that Contractor shall not be liable to Stratean under this
Section 5 for liabilities, penalties, demands, claims, causes of action, suits,
losses, damages, costs and expenses arising out of bodily injury (including
death) to any person or damage (including loss of use) to any property caused by
or resulting from the sole negligence of Stratean or its employees.

 

Stratean agrees that Contractor shall not be liable to Stratean for liabilities,
penalties, demands, claims, causes of action, suits, losses, damages, costs and
expenses arising out of bodily injury (including death) to any person or damage
(including loss of use) to any property caused by or resulting from Stratean,
its employees, or associates that are present for any purpose while Combustion
is providing Services associated with this Agreement.

 

8.NOTICE. Except as otherwise specifically provided, any notice required or
permitted to be given under this Agreement shall be in writing and shall be
deemed to have been sufficiently given if delivered in person, transmitted by
teletype or telegraph or if deposited in the United States mails, postage
prepaid, for mailing by first class registered or certified mail, addressed as
follows:

 

9.If to Stratean, it shall be addressed to: Stratean, Inc.

 

2391 South 1560 West

Woods Cross, UT 84087 Attention: Michael Barrett

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If to Contractor, it shall be addressed to:

 

Combustion Resources Inc. 1453 West 820 North Provo, Utah 84601 Attention: Craig
Eatough

 

or to such other address or individual as either party may specify from time to
time by written notice given by such party.

 

10.TERMINATIONgSUSPENSION. Stratean may, at any time, terminate this Agreement
in whole or in part, or suspend, delay or interrupt all or any part of the
Services hereunder by written notice or verbal notice confirmed in writing. If
Stratean terminates for convenience, Stratean will reimburse Contractor those
costs not in excess of the amount specified in Exhibit B, which were previously
incurred by Contractor in good faith in connection with the Services, including
a reasonable allowance for overhead and profit. Except for circumstances beyond
the reasonable control of Stratean, if the Services are suspended, delayed or
interrupted by Stratean and if Contractor is authorized by Stratean to resume
the Services, an equitable adjustment will be made to the amount specified in
Exhibit B and/or completion schedule.

 

11.STANDARD OF CARE. Contractor agrees that it will perform the Services in a
good and workmanlike manner, use sound principles and practices in the
performance of the Services to be provided hereunder, and will exercise high
standards of skill, care and diligence in the performance of the Services.

 

12.INDEPENDENT CONTRACTOR. Contractor is and shall remain an independent
contractor in its performance of the Services and neither Contractor nor anyone
directly or indirectly employed or engaged by Contractor shall make any
representations to the contrary.

 

13.COMPLIANCE WITH LAWS. Contractor shall comply with all Federal, State, and
local statutes, laws, ordinances, regulations, rules and codes applicable to the
Services, including Stratean's Site rules and regulations.

 

14.SAFETY. Contractor acknowledges and recognizes the importance of the safety
and health of all persons, including, but not limited to, employees of Stratean,
Contractor and other contractors. Contractor shall strictly and carefully comply
with all requirements of this Agreement and its attachments pertaining to safety
and health, including, but not limited to, the safety and health provisions of
Stratean policies, practices and rules for the jobsite. Contractor agrees to
devote special care and attention to, and to exercise its best efforts to
attain, the desired objective of performing the Services without injury to any
person.

 

15.ASSIGNMENT. Contractor shall not assign this Agreement or any payments due or
to become due hereunder without the prior written consent of Stratean. Any
attempted assignment without such consent shall be void. Assignment with such
consent shall not operate to relieve Contractor of any of its obligations under
this Agreement.

 

16.CAPTIONS. Headings of particular articles and paragraphs are inserted only
for convenience and are in no way to be construed to be a part of this Agreement
or as a limitation of the scope of the articles or paragraphs to which they
refer.

 

17.APPLICABLE LAW. THIS AGREEMENT SHALL BE CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS AND JUDICIAL DECISIONS OF THE STATE OF UTAH AND ALL
QUESTIONS OF PERFORMANCE HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH

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SUCH LAWS AND JUDICIAL DECISIONS; BY EXECUTION OF THIS AGREEMENT, CONTRACTOR
AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF UTAH.

 

18.INTELLECTUAL PROPERTY. Contractor will timely inform Stratean, in writing, of
any improvements, changes, advances, and/or modifications to the gasifier or any
system supporting operation of the gasifier that (1) are conceived or
recommended by Contractor (or any of its employees, its subcontractors, or
employees of its subcontractors) and (2) arise out of Contractor’s providing the
services contemplated by this Agreement. Any and all such improvements, changes,
advances, and/or modifications are the property of Stratean. Contractor agrees
that, at the request of Stratean, it will cause to be executed and delivered any
applications, affidavits, assignments, and other instruments as may be deemed
necessary or desirable to secure for or vest in Stratean, its successors, legal
representatives, or assigns, all right, title, and interest in and to any
application, patent, or other right or property directed to any such
improvement, change, advance, and/or modification, including the right to apply
for and obtain patents in the United States and foreign countries (e.g., under
the provisions of the International Convention).

 

19.ENTIRE AGREEMENT. This Agreement sets forth the entire agreement between
Stratean and Contractor with respect to the subject matter hereof. All prior
negotiations and dealings regarding this Agreement and the subject matter hereof
shall be deemed superseded by and merged into this Agreement.

 

IN WITNESS WHEREOF, Contractor and Stratean have executed this Agreement
effective as of the date set forth at its beginning.

 

Stratean Inc. Combustion Resources Inc.     By: /s/ Authorized Signatory By:
/s/Authorized Signatory Title: Title:

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Exhibit A

 

Description of Services

 

TASK 1: CHARACTERIZE FEEDSTOCK

The coal feedstock selected for use in the evaluation of the gasifier should be
fully characterized to assist in understanding how the gasifier performs for
that feedstock. The proposal does not include any costs associated with
obtaining the coal and preparing the coal for testing. The client will provide
the coal for the tests, and the coal will be ready for testing. Specifically,
this will include any cleaning, drying, or sizing of the coal that may be
required to make the coal ready for testing. The client will arrange for
delivery of the coal to the CEIC facility. The feedstock will be characterized
by performing the following analyses on the coal: elemental analysis, proximate
analysis, heating value determination, sulfur analysis, chlorine analysis, and
thermoggravimetric analysis (TGA).

 

TASK 2: REVIEW DESIGN DATA

Installation and operation of the gasifier will be more efficient with a full
understanding of the design of the gasifier, including configuration,
construction, theoretical operating conditions and performance, thermochemical
calculations, etc. Thus, a detailed review of the gasifier will be performed to
determine the gasifier operating conditions to use for the tests runs in this
project.

 

TASK 3: PREPARE GASIFIER FOR TEST RUNS

In this task, the gasifier will be relocated to USU’s CEIC facility near Helper,
UT, and prepared for the test runs. A steam generator will be installed at the
facility. It will also be necessary to make the required water, steam, power,
etc. connections required to operate the gasifier. Because of the quantity of
offggas that will be generated during the runs, it may be necessary to pipe the
offggas from the gasifier to the flare system at the CEIC facility.

 

TASK 4: PRELIMINARY TEST RUNS OF GASIFIER

Several shake down tests runs will first be performed without a solid feedstock
and then with coal to verify operation of various components of the gasifier.
The objective of these runs will be to verify that the gasifier and support
equipment (i.e. feed systems, monitoring and measurements systems, etc.) are all
working properly in preparation of the baseline test run. No sample collection
or analysis will be performed as part of this task.

 

TASK 5: PERFORM BASELINE RUN OF GASIFIER

The baseline test run of the gasifier will be performed after the shake down
runs have verified that the gasifier and support equipment are working properly.
The baseline test conditions will be established based on discussions with
Stratean personnel. The baseline test run will last about 10 hours, and will
require approximately 15 tons of coal. Based on the sampling capabilities of the
gasifier, samples of the gas, liquid, and solid effluent streams will be
collected three times during the test, and analyses will be performed of these
samples.

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Process conditions will be monitored based on the measurement capabilities of
the gasifier. The measured data from these tests will be inspected to determine
if the gasifier achieved stable operation during the test run, and to understand
and evaluate gasifier operation during the baseline test run. The results of the
baseline tests will be reviewed and evaluated for consistency by performing mass
and energy balances. An engineer from Peterson will be present at CEIC for the
baseline test run.

 

Following the completion of the test, Peterson will inspect and verify
mechanical operation and integrity of the gasifier. This exercise will provide
understanding if there are any negative impacts of the tests on the gasifier.

 

TASK 6: PERFORM EXTENDED RUN OF GASIFIER

An extended run of the gasifier will performed following a successful baseline
test run. The test conditions for the extended run will be established based on
the results of the baseline test run and discussions with Stratean personnel.
The extended run will last approximately

48 hours, and will require approximately 60 tons of coal. The test will be used
to demonstrate extended operation of the gasifier, and if there are any effects
of extended operation of the gasifier or associated support equipment, and
effects on product mix and quality from the gasifier.

 

Based on the sampling capabilities of the gasifier, the gas, liquid, and solid
effluents from the gasifier will be sampled every 8 hours during the 48ghour run
period to evaluate the operation of the gasifier during the extended run.
Analysis of the samples will be performed after the extended run is completed.
Process conditions will be monitored based on the measurement capabilities of
the gasifier. The measured data from these tests will be inspected to determine
if the gasifier achieved stable operation during the extended test run, and to
understand and evaluate gasifier operation during the test.

 

Following the completion of the test, Peterson will inspect and verify
mechanical operation and integrity of the gasifier. This exercise will provide
understanding if there are any negative impacts of the tests on the gasifier.

 

TASK 7: PROJECT REPORT

A report will be prepared at the conclusion of the study describing the results
of the evaluation of the gasifier. The report will provide a detailed discussion
of the results of the tests, and will make recommendations of possible process
revisions and additional work that can provide insights and direction for
optimizing gasifier performance. The report will also provide recommendations
for additional testing and items to be considered regarding the feasibility of
commercial operation of the gasifier for processing solid waste materials.

 

PROJECT SCHEDULE

 

The project schedule is shown in Exhibit C, and is referenced to the date that
the contract is executed. Contractor will make its best efforts to meet the
scheduled time for each task, but because the gasifier has never been operated
under test conditions, circumstances may be encountered that will delay the
schedule.

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Exhibit B

 

Compensation

Stratean will be charged $147,114 (“Project Fee”) per Contractor’s quote dated
September 30, 2014. $50,000 will be due at the start of the Project. Another
$50,000 will be due at the completion of Task 5. The balance ($47,114) of the
Project Fee will be due upon delivery of the Final Project Report.

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Exhibit C

 

Project Schedule

 

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