Document:

Exhibit 4.9
                                                                  PLAN DOCUMENT

           AMENDED AND RESTATED 1996 STOCK PURCHASE AND OPTION PLAN
                             FOR KEY EMPLOYEES OF
                SPALDING HOLDINGS CORPORATION AND SUBSIDIARIES

1.   Purpose of Plan
     ---------------

     The Amended and Restated 1996 Stock Purchase and Option Plan for Key
Employees of Spalding Holdings Corporation and Subsidiaries (the "Plan") is
designed:

     (a)  to promote the long term financial interests and growth of Spalding
Holdings Corporation (the "Company") and its subsidiaries by attracting and
retaining management personnel with the training, experience and ability to
enable them to make a substantial contribution to the success of the
Company's business;

     (b)  to motivate management personnel by means of growth-related
incentives to achieve long range goals; and

     (c)  to further the alignment of interests of participants with those of
the stockholders of the Company through opportunities for increased stock, or
stock-based, ownership in the Company.

2.   Definitions
     -----------

     As used in the Plan, the following words shall have the following
meanings:

     (a)  "Affiliate" shall mean any corporation directly or indirectly
controlling, controlled by, or under common control with, the Company, KKR or
any other entity designated by the Board of Directors of the Company in which
the Company or an Affiliate has an interest.

     (b)  "Board of Directors" means the Board of Directors of the Company.

     (c)  "Change of Control" means (i) a sale of all or substantially all of
the assets of the Company to a Person or Group who is not an Affiliate of
Kohlberg Kravis Roberts & Co., L.P. ("KKR"), (ii) a sale by KKR or any of its
Affiliates resulting in (A) more than 50% of the voting stock of the Company
being held by a Person or Group that does not include KKR or any of its
Affiliates and (B) more than 50% of the seats on the Board of Directors of
the Company being controlled by or being designees of a party or parties
other than KKR or any of its Affiliates, or (iii) a merger or consolidation
of the Company into another Person which is not an Affiliate of KKR.

<PAGE>

     (d)  "Committee" means the Compensation Committee of the Board of
Directors.

     (e)  "Common Stock" or "Share" means common stock of the Company which
may be authorized but unissued, or issued and reacquired.

     (f)  "Employee" means a person, including an officer, in the regular
full-time employment of the Company or one of its Subsidiaries who, in the
opinion of the Committee, is, or is expected to be, primarily responsible for
the management, growth or protection of some part or all of the business of
the Company.

     (g)  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

     (h)  "Fair Market Value" means such value of a Share as reported for
stock exchange transactions and/or determined in accordance with any
applicable resolutions or regulations of the Committee in effect at the
relevant time.

     (i)  "Grant" means an award made to a Participant pursuant to the Plan
and described in Paragraph 5, including, without limitation, an award of an
Incentive Stock Option, Non-Qualified Stock Option, Stock Appreciation Right,
Dividend Equivalent Right, Restricted Stock, Purchase Stock, Performance
Units, Performance Shares or Other Stock- Based Grant or any combination of
the foregoing.

     (j)  "Grant Agreement" means an agreement between the Company and a
Participant that sets forth the terms, conditions and limitations applicable
to a Grant.

     (k)  "Group" means two or more Persons acting together as a partnership,
limited partnership, syndicate or other group for the purpose of acquiring,
holding or disposing of securities of the Company.

     (l)  "Participant" means an Employee, or other person having a
relationship with the Company or one of its Subsidiaries, to whom one or more
Grants have been made and such Grants have not all been forfeited or
terminated under the Plan.

     (m)  "Person" means an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint venture,
governmental authority or other entity of whatever nature.

     (n)  "Stock-Based Grants" means the collective reference to the grant of
Stock Appreciation Rights, Dividend Equivalent Rights, Restricted Stock,
Performance Units, Performance Shares and Other Stock-Based Grants.

                                      -2-

<PAGE>

     (o)  "Stock Options" means the collective reference to "Incentive Stock
Options" and "Non-Qualified Stock Options".

     (p)  "Subsidiary" shall mean any company in an unbroken chain of
companies beginning with the Company if each of the companies, or group of
commonly controlled companies, other than the last company in the unbroken
chain then owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other companies in such chain.

3.   Administration of Plan
     ----------------------

     (a)  The Plan shall be administered by the Committee.  None of the
members of the Committee shall be eligible to be selected for Grants under
the Plan, or have been so eligible for selection within one year prior
thereto; provided, however, that the members of the Committee shall qualify
to administer the Plan for purposes of Rule 16b-3 (and any other applicable
rule) promulgated under Section 16(b) of the Exchange Act to the extent that
the Company is subject to such rule.  The Committee may adopt its own rules
of procedure, and action of a majority of the members of the Committee taken
at a meeting, or action taken without a meeting by written consent, shall
constitute action by the Committee.  The Committee shall have the power and
authority to administer, construe and interpret the Plan, to make rules for
carrying it out and to make changes in such rules.  Any such interpretations,
rules, and administration shall be consistent with the basic purposes of the
Plan.

     (b)  The Committee may delegate to the Chief Executive Officer and to
other senior officers of the Company its duties under the Plan subject to
such conditions and limitations as the Committee shall prescribe except that
only the Committee may designate and make Grants to Participants who are
subject to Section 16 of the Exchange Act.

     (c)  The Committee may employ attorneys, consultants, accountants,
appraisers, brokers or other persons.  The Committee, the Company, and the
officers and directors of the Company shall be entitled to rely upon the
advice, opinions or valuations of any such persons.  All actions taken and
all interpretations and determinations made by the Committee in good faith
shall be final and binding upon all Participants, the Company and all other
interested persons.  No member of the Committee shall be personally liable
for any action, determination or interpretation made in good faith with
respect to the Plan or the Grants, and all members of the Committee shall be
fully protected by the Company with respect to any such action, determination
or interpretation.

                                      -3-

<PAGE>

4.   Eligibility
     -----------

     The Committee may from time to time make Grants under the Plan to such
Employees, or other persons having a relationship with the Company or any of
its Subsidiaries, and in such form and having such terms, conditions and
limitations as the Committee may determine.  Grants may be granted singly, in
combination or in tandem.  The terms, conditions and limitations of each
Grant under the Plan shall be set forth in a Grant Agreement, in a form
approved by the Committee, consistent, however, with the terms of the Plan;
provided, however, such Grant Agreement shall contain provisions dealing with
the treatment of Grants in the event of the termination, death or disability
of a Participant, and may also include provisions concerning the treatment of
Grants in the event of a Change of Control of the Company.

5.   Grants
     ------
     From time to time, the Committee will determine the forms and amounts of
Grants for Participants.  Such Grants may take the following forms in the
Committee's sole discretion:

     (a)  Incentive Stock Options - These are stock options within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended
("Code"), to purchase Common Stock, which may only be granted to an Employee
(who is actually employed by the Company).  In addition to other restrictions
contained in the Plan, an option granted under this Paragraph 5(a): (i) may
not be exercised more than 10 years after the date it is granted; (ii) may
not have an option price less than the Fair Market Value of the Common Stock
on the date the option is granted; (iii) must otherwise comply with Code
Section 422; and (iv) must be designated as an "Incentive Stock Option" by
the Committee.  The maximum aggregate Fair Market Value of Common Stock
(determined at the time of each Grant) with respect to which Incentive Stock
Options are first exercisable with respect to any Participant under this Plan
and any Incentive Stock Options granted to the Participant for such year
under any plans of the Company or any Subsidiary in any calendar year is
$100,000.  Payment of the option price shall be made in cash or in shares of
Common Stock, or a combination thereof, in accordance with the terms of the
Plan, the Grant Agreement, and of any applicable guidelines of the Committee
in effect at the time.

     (b)  Non-Qualified Stock Options - These are options to purchase Common
Stock which are not designated by the Committee as "Incentive Stock Options".
At the time of the Grant the Committee shall determine, and shall include in
the Grant Agreement or other Plan rules, the option exercise period, the
option price, and such other conditions or restrictions on the grant or
exercise of the option as the Committee deems appropriate, which may include
the requirement that the grant of options is predicated on the acquisition of
Purchase Shares under Paragraph 5(e) by the Optionee.  In addition to other
restrictions contained in the Plan, an option granted under this Paragraph
5(b): (i) may not be exercised more than 10 years after the date it is

                                      -4-

<PAGE>

granted and (ii) may not have an option exercise price less than the par
value of the Common Stock on the date the option is granted.  Payment of the
option price shall be made in cash or in shares of Common Stock, or a
combination thereof, in accordance with the terms of the Plan, the Grant
Agreement and of any applicable guidelines of the Committee in effect at the
time.

     (c)  Stock Appreciation Rights - These are rights that on exercise
entitle the holder to receive the excess of (i) the Fair Market Value of a
share of Common Stock on the date of exercise over (ii) the Fair Market Value
on the date of Grant, multiplied by (iii) the number of rights exercised as
determined by the Committee.  Stock Appreciation Rights granted under the
Plan may, but need not be, granted in conjunction with an Option under
Paragraph 5(a) or 5(b).  The Committee, in the Grant Agreement or by other
Plan rules, may impose such conditions or restrictions on the exercise of
Stock Appreciation Rights as it deems appropriate, and may terminate, amend,
or suspend such Stock Appreciation Rights at any time.  No Stock Appreciation
Right granted under this Plan may be exercised less than 6 months or more
than 10 years after the date it is granted except in the event of death or
disability of a Participant.  To the extent that any Stock Appreciation Right
that shall have become exercisable, but shall not have been exercised or
cancelled or, by reason of any termination of employment, shall have become
non-exercisable, it shall be deemed to have been exercised automatically,
without any notice of exercise, on the last day on which it is exercisable,
provided that any conditions or limitations on its exercise are satisfied
(other than (i) notice of exercise and (ii) exercise or election to exercise
during the period prescribed) and the Stock Appreciation Right shall then
have value.  Such exercise shall be deemed to specify that the holder elects
to receive cash and that such exercise of a Stock Appreciation Right shall be
effective as of the time of automatic exercise.

     (d)  Restricted Stock - Restricted Stock is Common Stock delivered to a
Participant with or without payment of consideration with restrictions or
conditions on the Participant's right to transfer or sell such stock;
provided that the price of any Restricted Stock delivered for consideration
and not as bonus stock may not be less than par value of Common Stock on the
date such Restricted Stock is granted or the price of such Restricted Stock
may be the par value.  If a Participant irrevocably elects in writing in the
calendar year preceding a Grant of Restricted Stock, dividends paid on the
Restricted Stock granted may be paid in shares of Restricted Stock equal to
the cash dividend paid on Common Stock.  The number of shares of Restricted
Stock and the restrictions or conditions on such shares shall be as the
Committee determines, in the Grant Agreement or by other Plan rules, and the
certificate for the Restricted Stock shall bear evidence of the restrictions
or conditions.  No Restricted Stock may have a restriction period of less
than 6 months, other than in the case of death or disability.

                                      -5-

<PAGE>

     (e)  Purchase Stock - Purchase Stock refers to shares of Common Stock
offered to a Participant at such price as determined by the Committee, the
acquisition of which will make him eligible to receive under the Plan,
including, but not limited to, Non-Qualified Stock Options; provided,
however, that the price of such Purchase Shares may not be less than the par
value of the Common Stock on the date such shares of Purchase Stock are
offered.

     (f)  Dividend Equivalent Rights - These are rights to receive cash
payments from the Company at the same time and in the same amount as any cash
dividends paid on an equal number of shares of Common Stock to shareholders
of record during the period such rights are effective.  The Committee, in the
Grant Agreement or by other Plan rules, may impose such restrictions and
conditions on the Dividend Equivalent Rights, including the date such rights
will terminate, as it deems appropriate, and may terminate, amend, or suspend
such Dividend Equivalent Rights at any time.

     (g)  Performance Units - These are rights to receive at a specified
future date payment in cash of an amount equal to all or a portion of the
value of a unit granted by the Committee.  At the time of the Grant, in the
Grant Agreement or by other Plan rules, the Committee must determine the Fair
Market Value of the unit, the performance factors applicable to the
determination of the ultimate payment value of the unit and the period over
which the Company's performance will be measured.  These factors must include
a minimum performance standard for the Company below which no payment will be
made and a maximum performance level above which no increased payment will be
made.  The term over which the Company's performance will be measured shall
be not less than six months.

     (h)  Performance Shares - These are rights to receive at a specified
future date payment in cash or Common Stock, as determined by the Committee,
of an amount equal to all or a portion of the average Fair Market Value for
all days that the Common Stock is traded during the last forty-five (45) days
of the specified period of performance of a specified number of shares of
Common Stock at the end of a specified period based on the Company's
performance during the period.  At the time of the Grant, the Committee, in
the Grant Agreement or by Plan rules, will determine the factors which will
govern the portion of the rights so payable and the period over which the
Company's performance will be measured.  The factors will be based on the
Company's performance and must include a minimum performance standard for the
Company below which no payment will be made and a maximum performance level
above which no increased payment will be made.  The term over which the
Company's performance will be measured shall be not less than six months.
Performance Shares will be granted for no consideration.

                                      -6-

<PAGE>

     (i)  Other Stock-Based Grants - The Committee may make other Grants
under the Plan pursuant to which shares of Common Stock (which may, but need
not, be shares of Restricted Stock pursuant to Paragraph 5(d)) or other
equity securities of the Company are or may in the future be acquired, or
Grants denominated in stock units, including ones valued using measures other
than market value.  Other Stock-Based Grants may be granted with or without
consideration; provided, however, that the price of any such Grant made for
consideration that provides for the acquisition of shares of Common Stock or
other equity securities of the Company may not be less than the par value of
the Common Stock or such other equity securities on the date of such Grant.
Such Other Stock-Based Grants may be made alone, in addition to or in tandem
with any Grant of any type made under the Plan and must be consistent with
the purposes of the Plan.

6.   Limitations and Conditions
     --------------------------

     (a)  The number of Shares available for Grants under this Plan shall be
16,300,000 shares of the authorized Common Stock as of the effective date of
the Plan.  Unless restricted by applicable law, Shares related to Grants that
are forfeited, terminated, cancelled or expire unexercised, shall immediately
become available for Grants.

     (b)  No Grants shall be made under the Plan beyond ten years after the
effective date of the Plan, but the terms of Grants made on or before the
expiration of the Plan may extend beyond such expiration.  At the time a
Grant is made or amended or the terms or conditions of a Grant are changed,
the Committee may provide for limitations or conditions on such Grant.

     (c)  Nothing contained herein shall affect the right of the Company to
terminate any Participant's employment at any time or for any reason.

     (d)  Deferrals of Grant payouts may be provided for, at the sole
discretion of the Committee, in the Grant Agreements.

     (e)  Except as otherwise prescribed by the Committee, the amounts of the
Grants for any employee of a Subsidiary, along with interest, dividend, and
other expenses accrued on deferred Grants, shall be charged to the
Participant's employer during the period for which the Grant is made.  If the
Participant is employed by more than one Subsidiary or by both the Company
and a Subsidiary during the period for which the Grant is made, the
Participant's Grant and related expenses will be allocated between the
companies employing the Participant in a manner prescribed by the Committee.

     (f)  Other than as specifically provided in the Form of Management
Stockholder's Agreement attached hereto as Exhibit A, with regard to the
death of a Participant, no benefit under the Plan shall be subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,

                                      -7-

<PAGE>

encumbrance, or charge, and any attempt to do so shall be void.  No such
benefit shall, prior to receipt thereof by the Participant, be in any manner
liable for or subject to the debts, contracts, liabilities, engagements, or
torts of the Participant.

     (g)  Participants shall not be, and shall not have any of the rights or
privileges of, stockholders of the Company in respect of any Shares
purchasable in connection with any Grant unless and until certificates
representing any such Shares have been issued by the Company to such
Participants.

     (h)  No election as to benefits or exercise of Stock Options, Stock
Appreciation Rights, or other rights may be made during a Participant's
lifetime by anyone other than the Participant except by a legal
representative appointed for or by the Participant.

     (i)  Absent express provisions to the contrary, any grant under this
Plan shall not be deemed compensation for purposes of computing benefits or
contributions under any retirement plan of the Company or its Subsidiaries
and shall not affect any benefits under any other benefit plan of any kind
now or subsequently in effect under which the availability or amount of
benefits is related to level of compensation.  This Plan is not a "Retirement
Plan" or "Welfare Plan" under the Employee Retirement Income Security Act of
1974, as amended.

     (j)  Unless the Committee determines otherwise, no benefit or promise
under the Plan shall be secured by any specific assets of the Company or any
of its Subsidiaries, nor shall any assets of the Company or any of its
Subsidiaries be designated as attributable or allocated to the satisfaction
of the Company's obligations under the Plan.

7.   Transfers and Leaves of Absence
     -------------------------------

     For purposes of the Plan, unless the Committee determines otherwise: (a)
a transfer of a Participant's employment without an intervening period of
separation among the Company and any Subsidiary shall not be deemed a
termination of employment, and (b) a Participant who is granted in writing a
leave of absence shall be deemed to have remained in the employ of the
Company during such leave of absence.

                                      -8-

<PAGE>

8.   Adjustments
     -----------

     (a)   In the event of any change in the outstanding Common Stock by
reason of a stock split, spin-off, stock dividend, stock combination or
reclassification, recapitalization or merger, Change of Control, or similar
event, the Committee may adjust appropriately the number of Shares subject to
the Plan and available for or covered by Grants and Share prices related to
outstanding Grants and make such other revisions to outstanding Grants as it
deems are equitably required.

     (b)  In the event that the Participant's right to require the Company to
purchase his or her Shares or Options or the Company's right to require the
Participant to sell his or her Shares or Options, as provided in Sections 5
and 6, respectively, of the Form of Management Stockholder's Agreement
attached hereto as Exhibit A, or the Company's Right of First Refusal as
provided in Section 4 of the Form of Management Stockholder's Agreement,
gives rise to adverse accounting consequences to the Company in respect of
the treatment of Options granted pursuant to the Plan, the Committee may, in
its sole discretion, adjust the timing of the exercisability of such
outstanding Options to avoid such adverse accounting consequences.

9.   Merger, Consolidation, Exchange,
     Acquisition, Liquidation or Dissolution
     ---------------------------------------

     In its absolute discretion, and on such terms and conditions as it deems
appropriate, coincident with or after the grant of any Stock Option or any
Stock-Based Grant, the Committee may provide that such Stock Option or Stock-
Based Grant cannot be exercised after the merger or consolidation of the
Company into another company, the exchange of all or substantially all of the
assets of the Company for the securities of another company, the acquisition
by another company of 80% or more of the Company's then outstanding shares of
voting stock or the recapitalization, reclassification, liquidation or
dissolution of the Company, and if the Committee so provides, it may, in its
absolute discretion and on such terms and conditions as it deems appropriate,
also provide, either by the terms of such Stock Option or Stock-Based Grant
or by a resolution adopted prior to the occurrence of such merger,
consolidation, exchange, acquisition, recapitalization, reclassification,
liquidation or dissolution, that, for some period of time prior to such
event, such Stock Option or Stock-Based Grant shall be exercisable as to all
shares subject thereto, notwithstanding anything to the contrary herein (but
subject to the provisions of Paragraph 6(b)) and that, upon the occurrence of
such event, such Stock Option or Stock-Based Grant shall terminate and be of
no further force or effect; provided, however, that the Committee may also
provide, in its absolute discretion, that even if the Stock Option or Stock-
Based Grant shall remain exercisable after any such event, from and after
such event, any such Stock Option or Stock-Based Grant shall be exercisable
only for the kind and amount of securities and/or other property, or the cash

                                      -9-

<PAGE>

equivalent thereof, receivable as a result of such event by the holder of a
number of shares of stock for which such Stock Option or Stock-Based Grant
could have been exercised immediately prior to such event.

10.  Amendment and Termination
     -------------------------

     The Committee shall have the authority to make such amendments to any
terms and conditions applicable to outstanding Grants as are consistent with
this Plan provided that, except for adjustments under Paragraph 8 or 9
hereof, no such action shall modify such Grant in a manner adverse to the
Participant without the Participant's consent except as such modification is
provided for or contemplated in the terms of the Grant.

     The Board of Directors may amend, suspend or terminate the Plan except
that no such action, other than an action under Paragraph 8 or 9 hereof, may
be taken which would, without shareholder approval, increase the aggregate
number of Shares available for Grants under the Plan, decrease the price of
outstanding Options or Stock Appreciation Rights, change the requirements
relating to the Committee or extend the term of the Plan.

11.  Foreign Options and Rights
     --------------------------

          The Committee may make Grants to Employees who are subject to the
laws of nations other than the United States, which Grants may have terms and
conditions that differ from the terms thereof as provided elsewhere in the
Plan for the purpose of complying with foreign laws.

12.  Withholding Taxes
     -----------------

     The Company shall have the right to deduct from any cash payment made
under the Plan any federal, state or local income or other taxes required by
law to be withheld with respect to such payment.  It shall be a condition to
the obligation of the Company to deliver shares upon the exercise of an
Option or Stock Appreciation Right, upon payment of Performance units or
shares, upon delivery of Restricted Stock or upon exercise, settlement or
payment of any Other Stock-Based Grant that the Participant pay to the
Company such amount as may be requested by the Company for the purpose of
satisfying any liability for such withholding taxes.  Any Grant Agreement may
provide that the Participant may elect, in accordance with any conditions set
forth in such Grant Agreement, to pay a portion or all of such withholding
taxes in shares of Common Stock.

                                     -10-

<PAGE>

13.  Effective Date and Termination Dates
     ------------------------------------

     The Plan shall be effective on and as of the date of its approval by the
stockholders of the Company and shall terminate ten years later, subject to
earlier termination by the Board of Directors pursuant to Paragraph 10.

                                     -11-<PAGE>

                                                                    Exhibit 10.8

PROMISSORY NOTE

Cdn. $50,000                                                     August 10, 1999
                                               Burnaby, British Columbia, Canada

FOR VALUE RECEIVED, the receipt and sufficiency of which is hereby acknowledged,
Clean Energy Combustion Systems, Inc. and Clean Energy Technologies (Canada)
Inc. (collectively, the "Maker"), hereby jointly and severally promise to pay to
R. Dirk Stinson, or order (the "Holder"), at such address as the Holder may from
time-to-time designate by written notice to the Maker, the principal sum
hereinbelow described (the "Principal Amount"), together with interest thereon,
in the manner and at the times herebelow provided and subject to the terms and
conditions herebelow described.

1.   PRINCIPAL AMOUNT

     The Principal Amount means the sum of fifty thousand Canadian dollars (Cdn.
     $50,000), which has been advanced by the Holder to the Maker
     contemporaneously with or prior to the date of this Note, plus any such
     additional amounts as the Holder may in the future advance from time-to-
     time to the Maker.

2.   INTEREST

     Interest on the Principal Amount from time-to-time remaining unpaid shall
     accrue from the date of any advances to the Maker under this Note at the
     rate of Royal Bank Prime Rate plus 2% per annum. Interest shall be computed
     on the basis of a three hundred sixty (360) day year and a thirty (30) day
     month.

3.   PAYMENT ON PRINCIPAL AND INTEREST

     Subject to paragraphs 3 and 5, the Principal Amount and all interest and
     other indebtedness under this Note shall be due and payable at such time as
     the Maker raises the sum of seven hundred fifty thousand Canadian dollars
     (Cdn. $750,000) through equity, debt or joint-venture financing or product
     revenues, or any combination thereof, but in any event by August 10, 2000.

     Payments of any amount required hereunder shall be made solely in lawful
     money of Canada, and shall be credited first against other indebtedness
     under this Note, if any, next against accrued but unpaid interest, if any,
     and with the balance of such payment applied against the unpaid balance of
     the Principal Amount.

     The Maker reserves the right to prepay any portion of the Principal Amount
     in whole or in part (in either case with any accrued and unpaid interest
     through the date of prepayment plus any other amounts due under this Note)
     without prepayment penalty or premium or discount.

     Whenever any payment required under the terms of this Note shall be stated
     to be due on a day other than a business day, such payment shall be made on
     the next succeeding business day, and such extension of time shall in such
     case be included in the computation of payment of interest.

4.   ACCELERATION UPON DEFAULT

     At the option of the Holder, all or any part of the indebtedness of the
     Maker hereunder shall immediately become due and payable, irrespective of
     any agreed maturity, upon the happening of any of the following events of
     default:

     (a)  If the Maker shall make an assignment for the benefit of creditors;

                                       1
<PAGE>

     (b)  If a custodian, trustee, receiver, or agent is appointed or takes
          possession of substantially all of the property of the Maker;

     (c)  If the Maker becomes insolvent;

     (d)  If the Maker shall file a petition of bankruptcy, or apply to any
          tribunal for appointment of a custodian, trustee, receiver, or agent
          of the Maker, or commence any proceeding related to the Maker under
          any bankruptcy or reorganization statute, or under any arrangement,
          insolvency, readjustment of debt, dissolution, or liquidation law of
          any jurisdiction, whether now or hereafter in effect;

     (e)  If any petition is filed against the Maker under any bankruptcy or
          reorganization statute and either (1) the relief is ordered by the
          applicable jurisdiction against the Maker under the applicable
          bankruptcy or reorganization statute, or (2) such petition is not
          dismissed by the applicable jurisdiction within thirty (30) days of
          the date of filing; or

     (f)  If any attachment, execution, or other writ is levied on substantially
          all of the assets of the Maker and remains in effect for more than
          fifteen (15) days.

5.   CONVERSION OF NOTE INTO COMMON STOCK

     The Holder shall reserve the right at any time, in his sole discretion, to
     convert any portion of the Principal Amount and all interest and other
     indebtedness under this Note remaining unpaid into Clean Energy Combustion
     Systems, Inc. common stock at the conversion rate of two United States
     dollars (U.S. $2.00) per one (1) share of common stock. The Maker shall
     afford the Holder five (5) business days' prior written notice relative to
     the Maker's intent to pay or prepay the Principal Amount or any portion
     thereof in order to allow the Holder to make the aforesaid election.

6.   PURCHASE OF PBC TECNOLOGY

     The Maker agrees that it shall not have the right to exercise its right to
     purchase the PBC Technology from 818879 Alberta Limited pursuant to the
     terms of that certain PBC Technology License dated March 5, 1999 unless and
     until all indebtedness under this Note shall be paid or converted into
     common stock pursuant to the terms of this Note.

7.   COLLECTION COSTS AND ATTORNEYS' FEES

     The Maker agrees to pay the Holder all costs and expenses, including
     reasonable attorneys' fees, actually paid or incurred by the Holder in
     connection with the collection or enforcement of this Note. In the event
     any party institutes or should the parties otherwise become a party to any
     action or proceeding in connection with the enforcement or interpretation
     or collection of this Note, or for damages by reason of any alleged breach
     of this Note or any provision hereof and/or any alleged breach, of any
     instrument securing payment of this Note or any provision thereof, or for a
     declaration of rights in connection with this Note and/or any instrument
     securing payment of this Note, or for any other relief, including equitable
     relief, in connection with this Note, the prevailing party in any such
     action or proceeding shall be entitled to receive from the non-prevailing
     party all costs and expenses including, without limitation, reasonable
     attorneys' and other fees actually incurred by the prevailing party in
     connection with such action or proceeding, and shall also be entitled to
     collect as damages those costs and expenses hereinabove described in the
     first sentenced of this section.

8.   NOTICE

     Any notice to the Maker provided for in this Note shall be given by
     personal delivery or by express mail, Federal Express, DHL or similar
     airborne/overnight delivery service, or by mailing

                                       2
<PAGE>

     such notice by first class or certified mail, return receipt requested,
     addressed to the Maker at his or her address presently on the books of the
     Maker, or to such other address as the Maker may designate by written
     notice to the Holder. Any notice to the Holder shall be given by personal
     delivery or by express mail, Federal Express, DHL or similar
     airborne/overnight delivery service, or by mailing such notice by first
     class or certified mail, return receipt requested, addressed to the Holder
     at its present executive offices, or to such other address as may have been
     designated by written notice to the Maker. Mailed notices shall be deemed
     delivered and received three (3) days after deposit in accordance with this
     provision in the Canadian or, if applicable, United States mail.

9.   USURY COMPLIANCE

     All agreements between the Maker and the Holder are expressly limited, so
     that in no event or contingency whatsoever, whether by reason of the
     consideration given with respect to this Note, the acceleration of maturity
     of the unpaid Principal Amount and interest thereon, or otherwise, shall
     the amount paid or agreed to be paid to the Holder for the use,
     forbearance, or detention of the indebtedness which is the subject of this
     Note exceed the highest lawful rate permissible under the applicable usury
     laws. If, under any circumstances whatsoever, fulfillment of any provision
     of this Note after timely performance of such provision is due, shall
     involve transcending the limit of validity prescribed by law which a court
     of competent jurisdiction deems applicable, then ipso facto, the
     obligations to be fulfilled shall be reduced to the limit of such validity,
     and if, under any circumstances whatsoever, the Holder shall ever receive
     as interest an amount that exceeds the highest lawful rate, the amount that
     would be excessive interest shall be applied to the reduction of the unpaid
     Principal Amount and/or late charges under this Note and not to the payment
     of interest, or, if such excessive interest exceeds the unpaid balance of
     the Principal Amount and/or late charges under this Note, such excess shall
     be refunded to the Maker. This provision shall control every other
     provision of all agreements between the Maker and the Holder.

10.  GENERAL

     (A)  No Waiver of Holder's Rights. No delay or failure or act of commission
          or omission on the part of the Holder in exercising any rights under
          this including, without limitation, the Holder's right to accelerate,
          nor reinstatement of this Note by the Holder after such exercise,
          shall operate as a waiver of the Maker's right to exercise such right
          or of any other right under this Note or as a release of Maker, for
          the same default or any other default, except to the extent such
          waiver is in writing and signed by the Holder and then only to the
          extent specifically set forth in writing.

     (b)  Successors and Assigns. This Note and all of the covenants, promises
          and agreements contained in it shall be binding on and inure to the
          benefit of the respective legal and personal representatives, devises,
          heirs, successors, and assigns of the Maker and the Holder.

     (c)  Integration. This writing is intended by the parties to be an
          integrated and final expression of this Note and also is intended to
          be a complete and exclusive statement of the terms of that agreement.
          No course of prior dealing between the parties, no usage of trade, and
          no parole or extrinsic evidence of any nature shall be used to
          supplement, modify or vary any of the terms hereof. There are no
          conditions to the full effectiveness of this Note except as
          specifically provided herein.

     (d)  Invalidity. If any provision of this Note, or the application of it to
          any party or circumstance, is held to be invalid, the remainder of
          this Note, and the application of such provision to other parties or
          circumstances, shall not be affected thereby, the provisions of this
          Note being severable in any such instance.

                                       3
<PAGE>

     (e)  Interpretation. This Note shall be governed by, interpreted under and
          construed and enforced in accordance with the laws of the Province of
          British Columbia, Canada applicable to contracts entered into in the
          Province of British Columbia, Canada, by residents of the Province of
          British Columbia, Canada, and intended to be performed entirely within
          the Province of British Columbia, Canada.

IN WITNESS WHEREOF, the Maker, intending to be legally bound hereby, has duly
executed this Note the day and year first above written.

MAKER:

Clean Energy Combustion Systems, Inc.        Clean Energy Technologies (Canada)
                                             Inc.

By:     /s/ J.P. Thuot                       By:     /s/ B.A. Sheahan
   ---------------------------------            -----------------------------

                                       4

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