ESCROW AGREEMENT


 





	Escrow Agent:	MARK E. RINEHART
	Escrowing Parties:	JERRY HANSEN, an individual residing in the State of Utah
	 	TRACY JOHNSON, an individual residing in the State of Utah
	 	THE PI FOUNDATION, INC., a Utah nonprofit corporation
	 	KLEANGAS ENERGY TECHNOLOGIES, INC., a Delaware corporation
	 	FIBER RECOVERY, INC., a Wisconsin corporation







 


Effective Date: July 22, 2014


 


1. Establishment of Escrow. Subject
to all terms of this Escrow Agreement and in


accordance with separate Escrow Instructions that will be
given to Escrow Agent by the


Escrowing Parties, Escrow Agent agrees to hold certain documents
and other items and to


perform his obligations in accordance with the terms and
provisions of this Escrow Agreement


and the Escrow Instructions. The Escrow Instructions are
a part of this Escrow Agreement.


References herein to this Escrow Agreement are references
to both this Escrow Agreement and


the Escrow Instructions. The documents, funds or other items
from time to time deposited with


Escrow Agent hereunder are referred to herein as the “Escrowed
Items”.


 


2. Responsibility for Performance
by Escrowing Parties. Escrow Agent shall not be


responsible for any failure by any Escrowing Party to perform
the Escrowing Party’s obligations


in accordance with this Escrow Agreement, the Escrow Instructions,
the Stock Purchase


Agreement of even date herewith entered into by the Escrowing
Parties (the “Stock Purchase


Agreement”) or any “Transaction Document”
contemplated in the Stock Purchase Agreement, or


any related agreement.


 


3. Instructions to Escrow Agent.
Escrow Agent shall be protected in acting upon any


written instruction given him by the Escrowing Parties, not
only as to due execution and validity


and the effectiveness of any such instruction’s provisions,
but also as to the truth and accuracy of


any information therein contained. Where emailed or other
electronic instructions are permitted,


Escrow Agent may rely on the genuineness of messages purportedly
coming from an email


address previously used by a party or specified by the party
for the giving of notice without


further investigation. Should it be necessary for Escrow
Agent to act upon any instructions,


directions, documents or instruments issued or signed by
or on behalf of any corporation,


partnership, fiduciary or individual acting on behalf of
any Escrowing Party, it shall not be


necessary for Escrow Agent to inquire into such Escrowing
Party’s authority. Escrow Agent is


relieved of the necessity of satisfying himself as to the
authority of the persons executing this


Escrow Agreement or any Escrow Instructions in a representative
capacity on behalf of any of


the Escrowing Parties.


 


4. Escrow Agent’s
Role as Legal Counsel. Escrow Agent and/or Escrow Agent’s


law firm is legal counsel to Jerry
Hansen, Tracy Johnson and The PI Foundation. Each of the


Escrowing Parties waives any conflict
of interest that might be involved in that relationship as it


 


 


 




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may relate to the role of Escrow Agent hereunder. Escrow
Agent shall be compensated for his


services by deducting his fees, at his normal hourly rates,
from any Escrowed Items or funds


including earnest money, held by him. Each of the Escrowing
Parties hereby waives any conflict


of interest that might otherwise be involved in Escrow Agent’s
role under this Escrow


Agreement and Escrow Agent’s or his law firm’s
past, present or future representation of Jerry


Hansen, Tracy Johnson and The PI Foundation, and/or Escrow
Agent’s past or present


representation of Fiber Recovery, Inc., and each Escrowing
Party agrees that Escrow Agent and


his law firm shall be entitled to continue to represent Jerry
Hansen, Tracy Johnson and The PI


Foundation at all times in the future without any conflict
of interest, regardless of whether any


dispute arises under this Escrow Agreement or any matter
contemplated in this Escrow


Agreement.


 


5. Liability. Escrow Agent shall
not be liable for anything which he may do or


refrain from doing in connection herewith, except for his
own gross negligence, bad faith or


willful misconduct.


 


6. Escrow Agent’s Legal Counsel.
Escrow Agent may consult with, and obtain


advice from, legal counsel (which may include other attorneys
in Escrow Agent’s law firm at


their standard hourly rate) in the event of any question
as to any of the provisions hereof or his


duties hereunder, and he shall incur no liability and shall
be fully protected in acting in good


faith in accordance with the opinion and instructions of
such counsel. The Escrowing Parties


(other than the PI Foundation) shall share equally, and shall
pay upon written demand, the cost


and expense of any such consultation.


 


7. Limitation of Duties. Escrow Agent
in his capacity as such shall have no duties


except those which are expressly set forth herein and in
the Escrow Instructions signed by


Escrow Agent, and Escrow Agent shall not be bound by any
other agreements of the Escrowing


Parties (whether or not Escrow Agent has any knowledge thereof)
nor shall any additional duties


be implied. Escrow Agent shall not be deemed a fiduciary
of any Escrowing Party.


Notwithstanding any other provision of this Escrow Agreement,
in no event shall Escrow Agent


be liable, directly or indirectly, for any (a) damages or
expenses arising out of the services


provided hereunder, or (b) special or consequential damages,
even if Escrow Agent has been


advised of the possibility of such damages. Except as specifically
set forth in Section 4 of this


Escrow Agreement, neither Escrow Agent nor his law firm is
acting as legal counsel to any


Escrowing Party.


 


8. Resignation or Termination of
Escrow Agent. Escrow Agent shall have the right


to resign at any time by giving five days prior written notice
of such resignation to the Escrowing


Parties. The Escrowing Parties shall have the right to terminate
the services of Escrow Agent


hereunder at any time by giving joint, written notice (with
such written notice being signed by


each of the Escrowing Parties) of such termination to Escrow
Agent, in each case specifying the


effective date of such resignation or termination. Within
five days after receiving or delivering


the aforesaid notice, as the case may be, the Escrowing Parties
will appoint a successor escrow


agent to which Escrow Agent shall distribute the property
then held hereunder in accordance


with the terms hereof, less any fees and expenses that may
be payable to Escrow Agent. If a


successor escrow agent has not been appointed and accepted
such appointment by the end of


such five day period, Escrow Agent may interplead the Escrowed
Items or otherwise deliver or




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apply to any court of competent jurisdiction for the appointment
of a successor escrow agent, and


the reasonable costs and expenses which are incurred in connection
with any such proceeding


shall be paid out of the Escrowed Items or by the Escrowing
Parties, jointly and severally.


Except as otherwise agreed in writing by the Escrowing Parties,
the resignation or termination of


Escrow Agent shall not cause or permit any Escrowed Items
to be released from this Escrow


Agreement unless interpleaded with the court or unless and
until a successor escrow agent has


been appointed in accordance with this Section 8. Upon interpleader
or the appointment of a


successor escrow agent and the delivery of all Escrowed Items
held hereunder (other than fees


and expenses payable to Escrow agent) to such successor escrow
agent, Escrow Agent shall be


released from any and all liabilities arising hereunder.


 


9. Discharge of Escrow Agent. Upon
delivery of all of the Escrowed Items pursuant


to the terms of Section 8 above or pursuant to the Escrow
Instructions, Escrow Agent shall


thereafter be discharged from any further obligations hereunder.
Escrow Agent is hereby


authorized, in any and all events, to comply with and obey
any and all judgments, orders and


decrees of any court of competent jurisdiction which may
be filed, entered or issued, and all final


arbitration awards and, if he shall so comply or obey, he
shall not be liable to any other person


by reason of such compliance or obedience.


 


10. Interpleading of Assets upon
Dispute. In the event that (a) any dispute shall arise


between the Escrowing Parties with respect to the disposition
or disbursement of any of the


Escrowed Items held hereunder, or (b) Escrow Agent shall
be uncertain as to how to proceed in a


situation not explicitly addressed by the terms of this Escrow
Agreement whether because of


conflicting demands by the Escrowing Parties hereto or otherwise,
or (c) for any other reason in


Escrow Agent’s sole discretion, Escrow Agent shall
be entitled to interplead all of the Escrowed


Items held hereunder to a court of competent jurisdiction,
and thereafter Escrow Agent shall be


fully relieved from any and all liability or obligation with
respect to such interpleaded assets or


compliance with the terms of this Escrow Agreement or any
Escrow Instructions. The Escrowing


Parties agree to pursue any redress or recourse in connection
with such a dispute, without making


Escrow Agent a party to the same, and agree to waive and
hereby waive any potential conflicts


of interest Escrow Agent may have with relation to Escrow
Agent’s relationship with any


Escrowing Party hereto, and, provided that Escrow Agent has
interplead the assets held


hereunder according to this Section 10, each of the Escrowing
Parties hereby specifically waives


any objection to Escrow Agent acting as legal counsel to
Jerry Hansen, Tracy Johnson or The PI


Foundation with relation to any dispute arising hereunder
or to any matters relating to the


Transaction Documents.


 


11. Agents of Escrow Agent. Escrow
Agent shall have the right to perform any of his


duties hereunder through agents, attorneys, custodians or
nominees.


 


12. Garnishment of Escrowed Items.
If any of the Escrowed Items shall be attached,


garnished or levied upon by any court order, or the delivery
thereof shall be stayed or enjoined


by an order of a court, or any order, judgment or decree
shall be made or entered by any court


order affecting the property deposited under this Escrow
Agreement, Escrow Agent is hereby


expressly authorized, in his sole discretion, to obey and
comply with all writs, orders or decrees


so entered or issued, which he is advised by legal counsel
of his own choosing is binding upon


him, whether with or without jurisdiction, and in the event
that Escrow Agent obeys or complies




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with any such writ, order or decree he shall not be liable
to any of the Escrowing Parties hereto


or to any other person, firm or corporation, by reason of
such compliance notwithstanding such


writ, order or decree be subsequently reversed, modified,
annulled, set aside or vacated.


 


13. Indemnification. The Escrowing
Parties agree, severally and jointly, to indemnify


Escrow Agent for and to hold him harmless from and against
any loss, liability or reasonable


expense (including reasonable attorneys’ fees and expenses,
including fees of Escrow Agent’s


law firm) incurred by Escrow Agent arising out of or in connection
with his performance under


this Escrow Agreement. Escrow Agent shall have a lien or
right of setoff on all funds, monies or


other assets held hereunder to pay all of his fees and reimbursable
expenses or fees or any other


item payable to or for Escrow Agent as permitted under this
Escrow Agreement. The obligations


of the Escrowing Parties under this Section 13 shall survive
the termination of this Escrow


Agreement or the resignation or removal of Escrow Agent for
any reason.


 


14. Escrow Costs. Escrow Agent shall
be entitled to be paid fees for his services


under this Escrow Agreement, and in addition to such fee
to be reimbursed for his reasonable


costs and expenses incurred in connection with maintaining
the Escrowed Items hereunder.


Escrow Agent shall be entitled and is hereby granted the
right to set off and deduct from the


Escrowed Items any unpaid fees, non-reimbursed expenses and
unsatisfied indemnification


rights from such Escrowed Items, and Escrow Agent may include
in any deduction from the


Escrowed Items any bank imposed fee related to the wire-transfer
of funds to Escrow Agent’s


account. In the event that Escrow Agent is made a party to
litigation with respect to any Escrow


Item or this Escrow Agreement, or brings an action in interpleader
or in the event that the


conditions of the Escrow Instructions are not promptly fulfilled,
or Escrow Agent is required to


render any service not provided for in this Escrow Agreement,
or there is any assignment of the


interest of this escrow or any modification hereof, Escrow
Agent shall be entitled to reasonable


compensation for all such services and reimbursement for
all fees, costs, liability and expenses,


including reasonable attorneys’ fees.


 


15. Limitations on Rights to Escrowed
Items. None of the Escrowing Parties shall


have any right, title or interest in or to, or possession
of, the Escrowed Items and therefore shall


not have the ability to pledge, convey, hypothecate or grant
as security all or any portion of the


Escrowed Items unless and until such Escrowed Items have
been released pursuant to applicable


provisions of this Escrow Agreement. Accordingly, Escrow
Agent shall be in sole possession of


the Escrowed Items and shall not act as custodian or agent
of the Escrowing Parties under this


Escrow Agreement for the purposes of perfecting a security
interest therein, and no creditor of


any of the Escrowing Parties shall have any right to have
or to hold or otherwise attach or seize


all or any portion of the Escrowed Items as collateral for
any obligation and shall not be able to


obtain a security interest in any of the Escrowed Items unless
and until such Escrowed Items


have been released pursuant to applicable provisions of this
Escrow Agreement.


 


16. Notice. Any notice required or
permitted to be given hereunder shall be made in


the same manner as notices under the Stock Purchase Agreement.
Notices to any Escrowing


Party shall be delivered to the address of such party specified
in the Stock Purchase Agreement.


Notices to Escrow Agent shall be delivered to Mark E. Rinehart,
Callister Nebeker &


McCullough, 2180
S. 1300 East, Suite 600, Salt Lake City, Utah 84109.


 




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17. Governing Law, Jurisdiction and
Venue. This Escrow Agreement shall be


governed by and interpreted under the laws of the State of
Utah. In the event that any party


hereto commences a lawsuit or other proceeding relating to
or arising from this Escrow


Agreement, the parties hereto agree to the exclusive personal
jurisdiction by and exclusive venue


in the state and federal courts in the State of Utah and
waive any objection to such jurisdiction or


venue. The parties hereto consent to and agree to submit
to the jurisdiction of any of the courts


specified herein and agree to accept service of process to
vest personal jurisdiction over them in


any of these courts.


 


IN WITNESS WHEREOF, the Escrowing
Parties have executed and delivered this


Agreement on the dates set forth below, to be effective as
of the Effective Date.


 


 


 


	Date:	 	 	 
	 	 	 	JERRY HANSEN, an individual residing in the State of Utah
	 	 	 	 
	 	 	 	 
	Date:	 	 	 
	 	 	 	TRACY JOHNSON, an individual residing in the State of Utah
	 	 	 	 
	 	 	 	THE PI FOUNDATION, INC., a Utah nonprofit corporation
	 	 	 	 
	Date:	 	By:	 
	 	 	Name:	Scott
                                         M. McCullough




	 	 	Title:	Executive Director
	 	 	 	 
	 	 	 	 
	 	 	 	KLEANGAS ENERGY TECHNOLOGIES, INC., a Delaware corporation
	 	 	 	 
	Date:	 	By:	 
	 	 	Name:	 
	 	 	Title:	 





 


 




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FIBER
RECOVERY, INC., a Wisconsin


corporation


 


 


 





	Date:	 	By:	 
	 	 	Name:	 
	 	 	Title:	 





 


 


 


 


Accepted and agreed to on the date set forth below, to be
effective as of the Effective Date.


 


 


 


 





	Date:	 	 
	 	 	MARK E. RINEHART, Escrow Agent



 






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