Document:

Refined Coal Activities Supplemental Compensation Plan

 Exhibit 10.78 

Exhibit A 

ADA-ES, INC. 

Refined Coal Activities 

Supplemental Compensation Plan 

For 

Employees, Contractors and Consultants of ADA-ES, Inc. 

April 20, 2010 

1. Establishment of the Plan. ADA-ES, Inc. (the “Company”), by action of the Compensation Committee of the
Board of Directors, hereby establishes this “Refined Coal Activities Supplemental Compensation Plan” (the “Plan”) for Company employees, consultants and/or contractors, upon the terms and subject to the conditions set
forth herein. The Plan shall be administered by the Administrator (as defined herein). 
 2. Purpose of the Plan.
The purpose of the Plan is to incent Company employees, consultants and contractors who are actively involved with the Company’s Refined Coal Activities (as defined herein) to work for the success of such activities. In order to promote this
purpose, the Company hereby establishes the Plan under which it will make available a pool of funds (the “Incentive Pool”) from which payments shall be made to designated participants in the Plan (“Designated
Participants”) from amounts received by the Company from Refined Coal Activities (as defined herein). 
 3.
Definitions. Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in Exhibit A hereto. 

4. Establishment of the Incentive Pool. The Incentive Pool shall consist of an amount equal to seven percent (7%), of the
Net Contribution Margin received by the Company from the Company’s Refined Coal Activities. The Net Contribution Margin and Incentive Pool shall be calculated annually following the close of the Company’s fiscal year for such fiscal year,
in accordance with the terms and conditions set forth herein. 
 5. Allocation and Payment of Incentive Pool
Amounts: The Incentive Pool shall be allocated as follows: 
 Michael Durham, as Chief Executive Officer of the Company
– 3% of the Net Contribution Margin or 42.86% of the Incentive Pool. 
 Other Participant(s) – 4% of the Net
Contribution Margin or 57.14% of the Incentive Pool. 
 Payments of the amounts allocated to Designated Participants under the Plan shall be
made as soon as practicable following the end of each fiscal year. 
 ADA Refined Coal Activities Supplemental Compensation Plan 

 6. Eligibility Requirements. In order to be eligible as an “Other
Participant,” a Person must have been a Company employee, consultant or contractor during the fiscal year for which the designation is made. Dr. Durham shall determine the Other Participants and the relative percentage of the Incentive
Pool (out of the 57.14% allocated to Other Participants) to be allocated to each such Other Participant, annually following the close of the Company’s fiscal year for that fiscal year. No Person shall be entitled to any rights to any past or
future amounts payable under the Plan for any fiscal year other than the one for which they are a Designated Participant by reason of having been designated an Other Participant for a fiscal year other than the fiscal year for which they have been
so designated. 
 7. Termination of Participant Status Following Designation as an Other Participant. If
Dr. Durham or any Person designated as an Other Participant is subsequently terminated or terminates his or her employment, consulting or contracting relationship with the Company (a “Terminated Participant”) after designation
but prior to the time for payment of the amounts allocated to the Incentive Pool for a fiscal year for which the Terminated Participant has been so designated, any amount owing to such Terminated Participant shall be paid to such Participant at the
time of the next payment made to the Other Participants. 
 8. Other Applicable Terms and Conditions: 

 

	 	a.	Payment of any amounts due hereunder will be made annually, and will not be due and payable until the Company has actually received cash comprising the Revenue
includible in the Incentive Pool for that fiscal year. 

  

	 	b.	If Dr. Durham shall cease to be employed by the Company for any reason, the amount reserved to him under the Plan shall thereafter not be part of the Incentive
Pool. 

  

	 	c.	The Plan Administrator shall have the authority to adopt additional rules and regulations as it determines in its sole discretion under the Plan and such rules and
regulations shall be binding on all Plan Participants. 

  

 ADA-Refined Coal Activities Supplemental Compensation Plan 

2 

 Exhibit A 

To 

Refined Coal Activities 

Supplemental Compensation Plan 

Definitions: 

Capitalized terms used in the Plan that are not otherwise defined in the Plan have the definitions set forth herein: 

 

	 	a.	“Administrator” shall mean the Compensation Committee of the Board of Directors of the Company. 

 

	 	b.	“Company” means ADA-ES, Inc. and its wholly owned subsidiaries 

 

	 	c.	“CCS” means Clean Coal Solutions, LLC (f/k/a ADA-NexCoal, LLC). 

 

	 	d.	“Designated Participants” shall have the meaning set forth in Paragraph 2 of the Plan. 

 

	 	e.	“Incentive Pool” shall have the meaning set forth in the Paragraph 2 of the Plan. 

 

	 	f.	“Net Contribution Margin” means “Revenues” (as hereafter defined) less “Expenses” (as hereafter defined) related to
Refined Coal Activities, on a fiscal year basis at the Company level, as determined from the inception of each Refined Coal Activity included in the Plan, as determined in accordance with the accounting policies and practices of the Company
consistently applied, and subject to the other terms and conditions set forth herein. 

 For purposes of
calculating the Net Contribution Margin, Revenues and Expenses shall be determined as follows: 
 “Revenues”
shall consist of the following: 
  

	 	i.	Payments received by the Company from NexGen Refined Coal, LLC pursuant to Sections 2.1 and 2.2 of that certain Purchase and Sale Agreement dated as of November 3,
2006, as amended by the First Amendment to Purchase and Sale Agreement dated as of October 26, 2009, by and among ADA-ES, Inc., NexGen Refined Coal, LLC, and CCS, or any successor provision thereto, as may be amended from time to time
hereafter. 

  

 ADA-Refined Coal Activities Supplemental Compensation Plan 

	 	ii.	The first three years of payments received by ADA-ES, Inc. from the sale of Chemicals and Additives by ADA-ES, Inc. to CCS pursuant to that certain Chemicals, Equipment
and Technical Engineering Services Supply Agreement dated as of November 3, 2006, as amended by First Amendment to Chemicals, Equipment and Technical Engineering Services Supply Agreement dated as October 26, 2009, as may be amended from
time to time hereafter (collectively the “Supply Agreement”), by and between ADA-ES, Inc. and CCS that are generated by each new customer added during the Plan Period. 

 

	 	iii.	The payments received by ADA-ES, Inc. from the sale of Technical Engineering Services by ADA-ES, Inc. to CCS pursuant to the Supply Agreement that are generated during
the Plan Period. 

  

	 	iv.	Distributions received by ADA-ES, Inc. from CCS during the Plan Period pursuant to Section 1.3(a) of that certain Amended and Restated Operating Agreement of
ADA-NexCoal, LLC (n/k/a CCS, dated as of November 3, 2006 by and among ADA-ES, Inc. and NexGen Refined Coal, LLC as members, and CCS, or any successor provision thereto. 

 

	 	v.	Other cash payments received by the Company that are similar and consistent with those described in paragraphs i – iv in this Paragraph above resulting from other
Refined Coal Activities included in the Plan. 

 “Expenses” shall consist of the following:

  

	 	i.	All cash and non-cash compensation paid to consultants or contractors engaged by the Company from the inception of each activity constituting a Refined Coal Activity
included in the Plan. 

  

	 	ii.	All cash and non-cash compensation paid to Company personnel (including executives, consultants or contractors) for services attributable to any Refined Coal Activity
included in the Plan, from the inception of a Refined Coal Activity (including amounts that should be so attributed as a result of the nature of the services rendered to the Company by such Persons). 

 

	 	iii.	The first three years of costs incurred by the Company for Chemicals and Additives sold to CCS under the Supply Agreement that are attributable to each new customer
added during the Plan Period. 

  

	 	iv.	The costs of the Technical and Engineering Services sold to CCS under the Supply Agreement that are attributable to the Plan Period. 

 

	 	v.	All management and administrative costs (not otherwise included above) for Refined Coal Activities, including without limitation (i) sales and marketing expenses;
(ii) legal and accounting expenses; and (iii) travel expenses. 

  

 ADA-Refined Coal Activities Supplemental Compensation Plan 

4 

	 	vi.	Other expenses incurred by the Company that are similar (and consistent) with those described in paragraphs iii and iv in this Paragraph above, that are attributable to
any Refined Coal Activities included in the Plan. 

 The Net Contribution Margin and Incentive Pool will be
determined on a fiscal year basis using the internal accounting reports of ADA-ES (as reflected on the financial statements filed by the Company with the Securities and Exchange Commission), which are generally completed during the first fiscal
quarter of the following year. 
 The Incentive Pool amounts that relate to Dr. Durham and Other Participants will include
only the first three full years of revenue generated by any Refined Coal Activities customer. No amounts received from a Refined Coal Activities customer after such customer has been a customer for more than three full years shall be included in
Revenues included in the Net Contribution Margin or the Incentive Pool. 
 At any time when there is a mixture of Revenues
coming from new customers and customers that are beyond the three year period for Revenues includible in the Net Contribution Margin, then all expenses that cannot be attributed directly to the eligible customers will be allocated pro-rata according
to the revenue dollars generated by the customers for which amounts are included in the Incentive Pool as compared to total revenues generated by Refined Coal Activities. 

Revenue and Expenses shall not include amounts included in the net profit of the Company generated by a consolidated subsidiary by reason
of the consolidation of such subsidiary’s financial results with those of the Company. The manner in which the Net Contribution Margin shall be calculated to ensure that no Revenue or Expense amounts are included more than once in calculating
such Net Contribution Margin. 
  

	 	g.	“Other Participant” shall have the meaning set forth in Paragraph 6 of the Plan. 

 

	 	h.	“Person,” as the context requires, means a natural person, corporation, partnership, trust or other entity. 

 

	 	i.	“Plan Period” means the period beginning on January 1, 2006 and ending on December 31, 2013. 

 

 ADA-Refined Coal Activities Supplemental Compensation Plan 

5 

	 	j.	“Refined Coal Activities” means activities of the Company directed to the research, development, marketing and sale of “refined coal” (which
shall mean coal that is treated or altered in a manner necessary to reduce the levels of hazardous pollutants released on burning of such coal, which are presently being carried out through CCS , the Company’s joint venture with NexGen Refined
Coal, LLC pursuant to certain agreements originally entered into as of November 3, 2006. For purposes of the Plan, Refined Coal activities shall not include any activities under that certain License Agreement currently under negotiation with
Arch Coal Inc. pursuant to which the Company will license certain technology relating to treatment of coal. Any activity to be included as a “Refined Coal Activity” under the Plan (other than activities between the Company and CCS), shall
be included in the Plan only if and when designated as such by the Administrator. 

  

	 	k.	“Terminated Participant” shall have the meaning set forth in Paragraph 7 of the Plan. 

 

 ADA-Refined Coal Activities Supplemental Compensation Plan 

612% Secured Term Note, issued May 27, 2010

 EXHIBIT 10.5 

SECURED TERM NOTE 
  

			
	$2,300,000	  	Date: May 27, 2010

FOR VALUE RECEIVED, PA LLC (f/k/a PetroAlgae, LLC), a Delaware limited liability company (the
“Maker”) promises to pay to PetroTech Holdings, Corp., c/o Valens Capital Management, LLC (the “Payee”) at 875 Third Avenue,
3rd Floor, New York, New York 10022, or at such other
place as may be designated in writing by the Payee of this Secured Term Note (this “Term Note”), the principal sum of two million three hundred thousand and 00/100 Dollars ($2,300,000) together with any accrued and unpaid interest
hereon, on June 30, 2012 (the “Maturity Date”) if not sooner indefeasibly paid in full. 
 Interest payable on
the outstanding principal amount of this Term Note (including all PIK Amounts (as defined below) added thereto, the “Principal Amount”) shall accrue at a rate per annum equal to twelve percent (12%) (the “Contract
Rate”). Interest shall be (i) calculated on the basis of a 360 day year, and (ii) payable monthly, in arrears, commencing on June 1, 2010, on the first business day of each consecutive calendar month thereafter through and including the
Maturity Date, and on the Maturity Date, whether by acceleration or otherwise (each, an Interest Payment Date”). Through any Interest Payment Date, interest on the Principal Amount of this Term Note at the Contract Rate that shall
have accrued and shall remain unpaid as of such Interest Payment Date (for any Interest Payment Date, a “PIK Amount”) shall be paid on such Interest Payment Date by addition of such PIK Amount to the Principal Amount. At the
option of the Payee, the PIK Amounts added to the principal amount outstanding under this Term Note during such year shall be evidenced by a note (a “PIK Note”) in form and substance satisfactory to the Payee, provided, however,
that such PIK Note shall not be necessary to evidence such portion of the Principal Amount nor shall the absence of such PIK Note relieve the Maker of its obligation to pay such portion of the Principal Amount to the Payee. Notwithstanding any
other provision of this Term Note and the addition of any PIK Amount to the principal amount outstanding under this Term Note, the Maker may, in its sole discretion, pay any PIK Amount in cash on any Interest Payment Date without any premium or
penalty. The Maker shall give written notice to the Payee of any such payment of a PIK Amount in cash not less than one (1) Business Day prior to the applicable Interest Payment Date. All cash payments by the Companies of any PIK Amount that has
been added to the principal amount of this Term Note shall be deducted from the Principal Amount. 
 1. USE OF PROCEEDS.
The proceeds of the loan made pursuant to this Term Note shall be used by Maker solely for working capital purposes. 
 2.
OPTIONAL REDEMPTION IN CASH. The Maker may prepay this Term Note (“Optional Redemption”) by paying to the Payee a sum of money equal to the Principal Amount outstanding at such time together with accrued but unpaid interest
thereon and 

 
any and all other sums due, accrued or payable to the Payee arising under this Term Note (the “Redemption Amount”) outstanding on the Redemption Payment Date (as defined below).
The Maker shall deliver to the Payee a written notice of redemption (the “Notice of Redemption”) specifying the date for such Optional Redemption (the “Redemption Payment Date”), which date shall be within ten
(10) business days after the date of the Notice of Redemption (the “Redemption Period”). On the Redemption Payment Date, the Redemption Amount must be paid in good funds to the Payee. In the event the Maker fails to pay the
Redemption Amount on the Redemption Payment Date as set forth herein, then such Redemption Notice will be null and void. 
 3.
EVENT OF DEFAULT. The occurrence of any of the following events set forth in this section shall constitute an event of default (“Event of Default”) hereunder: 

a. Failure to Pay. The Maker fails to pay on demand hereunder any principal, interest or other fees hereon in accordance with the
terms herewith, or the Maker fails to pay any of the other Obligations (as defined in the Amended and Restated Master Security Agreement, dated as of July 24, 2007, by and between LV Administrative Services, Inc., as Agent (in its capacity as
administrative and/or collateral agent, the “Agent”), the Maker and PetroAlgae Inc. (“PetroAlgae”)(as further amended, restated, modified and/or supplemented from time to time, the “Master Security
Agreement”) ) when due; or 
 b. Breach of Covenant. The Maker or PetroAlgae Inc. breaches any covenant or any
other term or condition of this Term Note, the Master Security Agreement or any other Document (as defined below) to which either is party in any material respect and such breach, if subject to cure, continues for a period of fifteen (15) days
after the occurrence thereof; or 
 c. Breach of Representations and Warranties. Any representation, warranty or
statement made or furnished by the Maker or PetroAlgae in this Term Note, the Master Security Agreement or any other Document to which either is a party shall at any time be false or misleading in any respect on the date as of which made or deemed
made; or 
 d. Default Under the Master Security Agreement. The occurrence of any default (or similar term) in the
observance or performance of the Master Security Agreement or any other Document to which either is a party or condition relating to any indebtedness or contingent obligation of the Maker or PetroAlgae; or 

e. Bankruptcy. The Maker or PetroAlgae shall (i) apply for, consent to or suffer to exist the appointment of, or the taking
of possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its property, (ii) make a general assignment for the benefit of creditors, (iii) commence a voluntary case under the federal
bankruptcy laws (as now or hereafter in effect), (iv) be adjudicated a bankrupt or insolvent, (v) file a petition seeking to take advantage of any other law providing for the relief of debtors, (vi) acquiesce to, any petition filed
against it in any involuntary case under such bankruptcy laws, or (vii) take any action for the purpose of effecting any of the foregoing. 

 f. Judgments. Attachments or levies in excess of $5,000 in the aggregate are made
upon the Maker’s or PetroAlgae’s assets or a judgment is rendered against the Maker’s or Guarantor’s property involving a liability of more than $5,000.00; 

g. Insolvency. The Maker or PetroAlgae shall admit in writing its inability, or be generally unable, to pay its debts as they
become due or cease operations of its present business; 
 h. Change of Control. A Change of Control (as defined below)
shall occur with respect to the Maker or PetroAlgae, unless Payee shall have expressly consented to such Change of Control in writing. A “Change of Control” shall mean any event or circumstance as a result of which (i) any
“Person” or “group” (as such terms are defined in Sections 13(d) and 14(d) of the Exchange Act, as in effect on the date hereof), other than the Payee, is or becomes the “beneficial owner” (as defined in Rules 13(d)-3
and 13(d)-5 under the Exchange Act), directly or indirectly, of 35% or more on a fully diluted basis of the then outstanding voting equity interest of the Maker or PetroAlgae (other than a “Person” or “group” that beneficially
owns 35% or more of such outstanding voting equity interests of the Maker on the date hereof), (ii) the Board of Directors of each of the Maker and PetroAlgae shall cease to consist of a majority of the Maker’s or PetroAlgae’s board
of directors, as applicable, on the date hereof (or directors appointed by a majority of the board of directors in effect immediately prior to such appointment) or (iii) the Maker or PetroAlgae merges or consolidates with, or sells all or
substantially all of its assets to, any other person or entity; 
 i. Indictment; Proceedings. The indictment or
threatened indictment of the Maker or PetroAlgae or any executive officer of the Maker or PetroAlgae under any criminal statute, or commencement or threatened commencement of criminal or civil proceeding against the Maker or PetroAlgae or any
executive officer of the Maker or PetroAlgae pursuant to which statute or proceeding penalties or remedies sought or available include forfeiture of any of the property of the Maker or PetroAlgae; or 

j. The Master Security Agreement, Other Documents. (i) An Event of Default shall occur under and as defined in the Master
Security Agreement or any other Document, (ii) the Maker or PetroAlgae shall breach any term or provision of the Master Security Agreement or any other Document in any respect, (iii) the Maker or PetroAlgae attempts to terminate,
challenges the validity of, or its liability under, the Master Security Agreement, this Term Note or any other Document, (iv) any proceeding shall be brought to challenge the validity, binding effect of the Master Security Agreement, this Term
Note or any other Document or (v) the Master Security Agreement or any other Document ceases to be valid, binding and enforceable obligation of the Maker and/or the Guarantor, as applicable. 

4. DEFAULT INTEREST. Following the occurrence and during the continuance of an Event of Default, the Maker shall pay additional
interest on the outstanding principal balance of this Term Note in an amount equal to one percent (1%) per month, and all outstanding obligations under this Term Note, the Master Security Agreement, each other Document including unpaid
interest, shall continue to accrue interest at such additional interest rate from the date of such Event of Default until the date such Event of Default is cured or waived. 

 5. REMEDIES. During the continuance of any Event of Default, the Payee may in
addition to its rights under any applicable law, declare immediately due and payable all or part of any obligation (including any accrued but unpaid interest thereon) under this Term Note whereupon the same shall become immediately due and payable,
without presentment, demand, protest or further notice or other requirements of any kind, all of which are hereby expressly waived by the Maker; provided, however, that, effective immediately upon the occurrence of the Events of
Default specified in Section 2(e), each obligation under this Term Note including all accrued but unpaid interest thereon shall automatically become and be due and payable, without presentment, demand, protest or further notice or other
requirement of any kind. 
 6. AUTHORITY. The Maker represents that the Maker has full power, authority and legal right
to execute and deliver this Term Note. The Maker further represents that this Term Note constitutes a valid and binding obligation of the Maker enforceable against the Maker in accordance with its terms. 

7. DEFINED TERMS. Whenever used, the singular number shall include the plural, the plural the singular, and the words
“Payee” and “Maker” shall include, respectively, their respective successors and assigns; provided, however, that the Maker shall in no event or under any circumstance have the right to assign or transfer its
obligations under this Term Note or the related documents, in whole or in part, to any other person, party or entity. 
 8.
HEADINGS, ETC. The headings and captions of the numbered paragraphs of this Term Note are for convenience of reference only and are not to be construed as defining or limiting, in any way, the scope or intent of the provisions hereof.

 9. ENFORCEABILITY. The Maker acknowledges that this Term Note and the Maker’s obligations under this Term Note
are and shall at all times continue to be absolute and unconditional in all respects, and shall at all times be valid and enforceable irrespective of any other agreements or circumstances of any nature whatsoever which might otherwise constitute a
defense to this Term Note and the obligations of the Maker under this Term Note or the obligations of any other person or party relating to this Term Note. This Term Note, all other notes issued by Maker and/or PetroAlgae to the Payee, now or in the
future, and the guarantees, security agreements, other agreements, instruments and documents executed and/or delivered in connection therewith and herewith (collectively and as the same may be amended or otherwise modified from time to time, the
“Documents” and each, a “Document”) set forth the entire agreement and understanding of the Payee and the Maker, and the Maker absolutely, unconditionally and irrevocably waives any and all right to assert any
setoff, counterclaim or crossclaim of any nature whatsoever with respect to this Term Note or the obligations of the Maker hereunder or thereunder, or the obligations of any other person or party relating hereto or thereto or to the obligations of
the Maker hereunder or thereunder or otherwise in any action or proceeding brought by the Payee to collect this Term Note, or any portion thereof, or to enforce, foreclose and realize upon the liens and security interests of the Payee in any
collateral. The Maker acknowledges that no oral or other agreements, conditions, promises, understandings, representations or warranties exist with respect to this Term Note or with respect to the obligations of the Maker under this Term Note,
except those specifically set forth in this Term Note. 

 10. WAIVER. The Maker waives presentment, demand for payment, notice of dishonor and
any or all notices or demands in connection with the delivery, acceptance, performance, default or enforcement of this Term Note and consents to any or all delays, extensions of time, renewals, release of any party to any document related to this
Term Note, and of any available security therefor, and any and all waivers or modifications that may be granted or consented to by the Payee with regard to the time of payment or with respect to any other provisions of any of the Documents, and
agrees that no such action, delay or failure to act on the part of the Payee shall be construed as a waiver by the Payee of, or otherwise affect, in whole or in part, its right to avail itself of any remedy with respect thereto. No notice to or
demand on the Maker shall be deemed to be a waiver of the obligation of the Maker or of the right of the Payee to take further action without further notice or demand as provided in any of the Documents. 

11. ASSIGNABILITY. This Term Note shall be binding upon the Maker and its successors and assigns, and shall inure to the benefit
of the Payee and its successors and assigns, and may be assigned by the Payee. The Maker may not assign any of its obligations under this Term Note without the prior written consent of the Payee, any such purported assignment without such consent
being null and void. 
 12. SECURITY. LV Administrative Services, Inc., as Agent, for the benefit of the Payee, has been
granted a security interest in certain assets of the Maker and PetroAlgae, as more fully described in (i) the Master Security Agreement and (ii) the Equity Pledge Agreement, dated as of July 24, 2009 by the Guarantor in favor of Agent
for the benefit of Payee. 
 13. AMENDMENTS. This Term Note may not be modified, amended, changed or terminated orally,
except by an agreement in writing signed by the Maker and the Payee. No waiver of any term, covenant or provision of this Term Note shall be effective unless given in writing by the Payee and, if so given by the Payee, shall only be effective in the
specific instance in which given. 
 14. GOVERNING LAW. This Term Note is and shall be deemed entered into in the State
of New York and shall be governed by and construed in accordance with the laws of the State of New York, without regard to principles of conflicts of laws. 

 IN WITNESS WHEREOF, the Maker has duly executed this Term Note the day and year first above
written. 
  

			
	PA LLC
		
	By:	 	 /s/ David P. Szostak

		 	Name:  David P. Szostak
		 	Title:    Chief Financial Officer

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